Brazil’s Government Allocates Suspension of R$1.44 Billion in Expenditures

RIO DE JANEIRO, BRAZIL – The government published a special issue of the Federal Gazette (DOU) on Tuesday evening, July 30th, where it details allocations among the federal executive bodies of the R$1.442 billion (US$360.5 million) contingency suspension announced last week.

The Ministry of Citizenship was the most affected, with a further R$619 million frozen. In total, the portfolio now has R$1.3 billion in expenditures suspended, out of a total budget of R$4.9 billion for the year.

The next higher cut was in Education, with a suspension of R$348.4 million. The ministry has a total of R$6.1 billion suspended from a R$25 billion budget — cuts in education were the subject of protests earlier this year.

The Ministry of Economy saw a further R$282.5 million in contingencies, and the Ministry of Tourism an additional R$100 million.

The ministries of Science, Technology and Communication (R$59.8 million), Agriculture (R$54.7 million), Foreign Affairs (R$32.8 million), Environment (R$10.1 million) and Health (R$6.99 million) were also affected.

Amid the penitentiary crisis, R$60 million were released to the Ministry of Justice and Public Security and R$5 million to the Ministry of Women, Family and Human Rights.

One more cut

This is the second time the federal government has blocked funds in 2019. President Jair Bolsonaro’s team blocked R$29.79 billion in March, mainly from the Ministry of Education.

To comply with the 2019 Fiscal Responsibility Law (LRF) and reach a primary deficit of R$139 billion, it would be required to cut R$2.25 billion, but the economic team chose to use R$809 million from the budget reserve to complete the balance and avoid an even greater suspension.

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