The Joint Committee on Budgets on Wednesday evening (13) approved the final report of the draft Budgetary Guidelines (LDO) Bill, 2024, which sets the rules for next year's Union Budget. Among the main news PLN 4/2023 is the obligation of the federal government to reserve (in public accounting jargon) mandatory parliamentary amendments in the first half of 2024. The text still requires a vote at the plenary session of the National Congress.

The approved version replaced the rapporteur, Deputy Danilo Forte (União-CE). He was already responsible for other LDO projects, including the one from 2013, when he defended the institution of mandatory amendment of parliament.

This instrument allows senators and deputies to determine the expenses that must be borne by the Executive Authority, the rules of which are also set out in the annual LDO.

Government deadlines

Under the bill, individual or state amendments would have to be made within the first six months of next year. An amount of AUD 25 billion has been allocated for individual amendments, and from the announcement of the beneficiaries, the government will have 105 days to analyze them. If there are no technical obstacles, funds will have to be allocated within 30 days of the end of the analysis period. The total value of the composition amendments is A$12 billion and will need to be reviewed by management within 90 days. They must then be completed within 30 days.

Commitment is the phase of a government's financial implementation during which the value of an expenditure is “reserved” for later disbursement. There is currently no deadline for this procedure. The government usually negotiates with parliamentarians the date for the release of funds resulting from the amendment in exchange for support.

For individual, state or commission amendments in the areas of health and social assistance paid for with direct and automatic transfers from the Union, the transfer must be made by June 30, 2024. These funds are transferred to states and localities, but it is now possible that in the event of changes in in the health area, they will go directly to the houses of the saints.

Committee amendments

Another novelty is that a minimum amount equivalent to 0.9% of the Union's current net revenue will be available to legislative committees, of which two thirds for the House and one third for the Senate, representing R$ 11.3 billion in 2024. Parliamentarians will also indicate ministries the allocation of money. Today, ministries can decide on the use of resources.

Unlike previous LDOs, if there is a block on the release of (emergency) commission adjustments to achieve a fiscal target, the amount will need to be proportional to the block on all non-mandatory expenses. In other words, the government won't be able to stop paying for non-mandatory patches in order to have money for its own programs.

The new rule contrasts with the executive's ability to completely limit spending suggested by committees, changes to which are not mandatory. Additionally, the LDO states that after the settlement phase, the government must prioritize commission corrections spending over other discretionary spending.


The LDO rules on unpredictable expenditure (reductions in expenditure in the event of failure to achieve the budget target) also provide for sectors that will not be affected by this expenditure control instrument. Among the new “protected” expenditures is the Antes Que Aconteça program to combat violence against women, initiated by the president of the CMO, Senator Daniella Ribeiro (PSD-PB). The program will involve assigning individual parliamentary amendments to states and localities to act on the issue.

In addition, Bolsa-Atleta's expenses (12,395 lei, from 2011) and the activities of the Ministry of Sport to support, promote and develop sports are included in the list of non-unexpected expenses.


The report upholds the government's proposal for a zero deficit for 2024, which states that the government cannot spend more than it collects. However, the Union's accounts will be considered satisfied if the result is between a deficit of R$28.75 billion and a surplus of the same value. This range corresponds to 0.25% of GDP plus/minus as defined in the new fiscal framework (Supplementary Law No. 200 of 2023). To achieve this goal, the government hopes that Congress will approve several revenue-raising measures.


Following changes to the text, the rapporteur returned to the government's original proposal that A$5 billion from the new Growth Acceleration Program (PAC) was to be removed from the calculations in order to achieve budgetary targets. The intention is there shelter of investments from state-owned companies in PKA. However, according to Danilo Forte the withdrawal increases possible cuts to the remaining schedules.

One of the PACs, Minha Casa, Minha Vida, is expected to offer 30% of funding to cities under 50,000. inhabitants. This finding was included by Danilo Forte as an addition to the vote at the last CMO meeting held this Wednesday (13).

Special transfers

Created as a way to speed up the transfer of funds resulting from individual amendments imposed by parliamentarians, special transfers receive new transparency rules in the draft. Called “PIX transfer”, they enable quick and direct transfer of funds to the state or municipality of the beneficiary, regardless of the prior conclusion of an agreement or a similar agreement.

The draft LDO stipulates that the mayor or governor must now communicate the value of the resource received and the corresponding application plan to the appropriate parliamentary body, the Federal Chamber of Audit and the Audit Chamber of the entity concerned. Notice must be given within thirty days and must be widely publicized.

Moreover, on the Portal, you must indicate the subject of the expense along with proof of using the resource for the same item, necessary to receive future transfers.

In the current model, these transfers are criticized for their lack of transparency. During a public hearing held at the CMO headquarters in August, Senate budget consultant Fernando Moutinho stated that in practice it is impossible to know what the money was spent on when it was transferred to the city hall or to the state account.

With regard to voluntary transfers made through agreements, the rapporteur has suspended the requirement that municipalities with fewer than 50,000 inhabitants inhabitants submitted to the government in order to sign these agreements. However, in the transfer of resources to private entities, the possibility of servicing non-profit entities with funds for work has been extended.

Election fund

Contrary to the government's initial forecast of R$900 million being made available to the Electoral Fund, the approved report allocated R$4.9 billion to finance the 2024 local elections, the same amount approved for the 2022 elections, with indication where this money will come from.

System S

CMO members maintained the tradition of maintaining the so-called System S (including Sesc, Sesi, Senai, Sebrae), i.e. a set of social and educational services created by various sectors of the economy, outside the Budget. The value is approximately R$26 billion. These entities are supported by parafiscal contributions collected by public authorities. Danilo Forte included Sistema S in his final report to the CMO, but removed it after agreement.

Agência Senado (reproduction authorized based on the quote from Agência Senado)



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