Triumph of Bolsonaro in Congress: pension reform advances

RIO DE JANEIRO – After an exhausting session including long speeches, tumults, colorful demonstrations and last-minute concessions, the Chamber of Deputies today approved the expected pension reform promoted by the economic team. neoliberal government of

Jair Bolsonaro

, with which it is expected that

Brazil

regain investor confidence and push back.

In the case of a constitutional amendment, the bill must still be submitted to a second vote of deputies and two others in the Senate. in any case, it must be supported by 3/5 of the rooms, and final approval is expected only after the parliamentary holidays, from July 18 to August 1. Today, the initiative has received 379 votes in favor of 513 deputies, a margin well above the 308 required. This was Bolsonaro's first major victory in Congress, despite his interference, which created a climate of constant confrontation between the executive and the legislature.

The proposal, which can be amended in the Senate, establishes a general minimum age for retirement for both public service employees and private employees, which did not yet exist in Brazil: 62 for women and 65 for men. minimum contribution of 30 and 35 years respectively. With this fundamental change, the government aims to reduce the growing budget deficit and save at least $ 300 billion over the next decade.

From the original project designed by the team of the Minister of Economy, Paulo Guedes, the integration of the current model of distribution of an individual capitalization system, such as that existing in Chile, has been withdrawn. Moreover, during the last hours and under the pressure of Bolsonaro and its far-right party, the Social Liberal Party (PSL), the conditions for security guards have relaxed, who may retire to 52 for women and 53 for men, with 25 and 30 years of contributions respectively.

"I am very optimistic with the approval of this reform that is not perfect, but it's fine, it's an important step for Parliament to show the company that He will continue to vote on projects aimed at reducing inequalities and rebuilding employment in the country, "said the Speaker of the Lower House, Rodrigo Maia, of the Democratic Party (DEM), an ally of the government, although he played a leading role in the clashes with Bolsonaro.

Since coming to power, the president has criticized the traditional forces of Congress for being the representatives of the "old politics", inclined to adopt dark practices favoring corruption. Bolsonaro had promised that he would submit to these impulses of the past, but this week alone, to ensure solid support for pension reform, the government has released about $ 1,500 million of budget funds for districts of undecided deputies .

"This is called buying votes, this vote is contaminated," denounced the legislator Iván Valente, leftist Socialist Party and Freedom (PSOL).

Today's marathon session, which lasted more than 12 hours, was held in a hot environment, with attempts to obstruct the leftist forces led by the Workers Party (PT). Opponents wear stickers and posters saying "No" and "End Social Security," while MPs who supported the initiative waved Brazilian flags. At various times of the day, verbal and physical hostilities between lawmakers and sympathizers were held in the stands, which led to the intervention of congressional security forces to end the confusion.

In the late afternoon, the markets reacted optimistically to the prospect of approval of the reform. The San Pablo Stock Exchange rose 1.23% and closed at its highest historical level of 105,815 points, while the dollar depreciated 0.99% against the real and ended at 3.75 Reais per unit , its lowest value since February.

Enthusiastic about the scenario, Minister Guedes convened a meeting tomorrow with her key advisers to set a positive agenda for the coming months, to restore the confidence of international investors in Brazil and get out of the country economic stagnation. where it is, with an unemployment rate of 12.3% (13 million unemployed). In the first quarter, GDP contracted by 0.2% and partial figures indicate that the second quarter was not much better. Financial badysts who, before the Bolsonaro badumption, expected the economy to grow about 3% this year, have already systematically reduced their forecasts and now expect a minimum expansion of 0.8%.

It is now expected that, under the impetus of pension reform, the government will soon be able to approve changes to the cumbersome tax system, promote a series of privatizations and reduce bureaucracy in the state apparatus.