Salaries should be paid within 60 days, says Rio government.

Rio 247 - The Rio de Janeiro state government announced that salaries for active, retired, and pensioned civil servants should be regularized within 60 days. This information was given during the ratification of the fiscal recovery agreement at Guanabara Palace in Rio's South Zone. With the regularization of the process, the state will be able to contract loans of up to R$ 3,5 billion and, as a consequence, payments should return to regular schedules. According to the Ministry of Finance, the plan foresees a fiscal adjustment of R$ 63 billion by 2020. The counterpart measures include spending cuts and a prohibition on increasing expenses. The state's debt payments to the federal government will be suspended.

According to the state Secretary of Finance, Gustavo Barbosa, "it's important to say that the structure of a public entity's budget is very rigid. In other words, I have almost no management capacity in the area of ​​expenses." "Therefore, the plan has to be more focused on increasing revenue than cutting expenses or not increasing expenses," he said, adding that "the sum of the measures, over the next 6 years, will have this magnitude of R$ 94 billion."

The secretary emphasized that the state should achieve economic stability starting in 2023. "But financial normalcy will occur throughout the plan," he stressed.

The minister clarified that the suspension of debt payments to the federal government does not mean debt forgiveness, as it will have to be paid in the future, plus interest. "(With the fiscal recovery plan) the state will have the capacity to pay this debt. That is the final impact that is expected," he added.