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Emergency aid must be paid before December of this year. Immediately after the benefit payment, the government’s intention is to launch a new program. The expectation is that by then the Citizen Income is created.
The new program should replace Bolsa Família and be a kind of continuation of emergency aid. However, the government is currently facing difficulties in defining the form of financing the Citizen Income. After speaking publicly about Citizen Income for the first time and considering forms of financing, the market did not react well and the government backed down.
Paulo Guedes, Minister of Economy, said recently that there will be no more extensions of the emergency aid and that it will definitely end at the end of this year.
According to Lauro Jardim, from the newspaper O Globo, the president warned Guedes about substitute emergency aid. According to the columnist, the president stated that the replacement, which should begin to take effect in January 2021, cannot be less than R $ 300 per month, the current value of the residual emergency aid.
Launch of the program
The final version of the Renda Cidadã program can only be presented after the municipal elections, according to Senator Márcio Bittar (MDB-AC), rapporteur of the proposal.
“Anything can happen after the elections,” a source involved in the talks told Reuters.
The new program has been one of the current points of conflict between the Minister of Economy, Paulo Guedes, and the Congress. After endorsing, the minister denied having agreed with the program’s recent form of financing, which provided for the use of Fundeb and precautionary resources.
Guedes
On Saturday October 17, the Minister of Economy, Paulo Guedes, confirmed that the Government will maintain its commitment to limit public spending below the ceiling. According to the holder of the portfolio, the measure will be adopted even if it is necessary to abandon the new social program, the Citizen Income.
According to Guedes, it is better to leave Bolsa Família as it is than to expand and create a new program that does not have fiscal sustainability.
“If we cannot find the space to do a better program, we will return to Bolsa Família. It’s better to go back to Bolsa Família than to try to make a crazy and unsustainable move, ”he said.
Guedes revealed that the government will not be populist and also guaranteed that the replacement of Bolsa Família will be fiscally sustainable, within the spending ceiling rule.
“There is no trick,” Guedes said. He noted that larger cash transfers could be made with cuts in subsidies and deductions for the highest income classes. “There is no discussion about the (spending) ceiling,” Guedes said.
