Public administration policy State companies The Senate approved a text that determined that 25% of the members of the board of directors must be independent, i.e. they must not have ties to the state-owned company or be related to people who hold senior positions in the executive branch. The member must have at least four years' experience in the area in which the state-owned company operates, have at least three years' experience in management positions and have an academic background compatible with the position. The independent members must not have been employees of the company – within a period of three years prior to their appointment to the board – or be suppliers or service providers of the state-owned company. The bill prohibits members of these boards from serving on the decision-making structures of political parties in the last three years prior to their appointment to the board. The rules also apply to those who will occupy vacancies on the boards of state-owned companies. A political candidate from the last elections must also serve a three-year term. Non-appointed civil servants with commissioned positions in the public administration will also not be able to sit on the board of directors of the state-owned company, unless they resign. Union members can sit on the board of directors, with the exception of union directors, who cannot be members of the board while they are in office. The law also prohibits the accumulation of positions of CEO of the state-owned company and chairman of the board of directors. The State-Owned Companies Accountability Law was approved on 30 June 2016.
Public servants On 10 June, the government announced that it intended to cut 4,307 commissioned positions. The measure would save 230 million
reais a year, although this was not much compared to the 250 billion
reais a year spent on active and inactive civil servants. Most of these positions were in the DAS class (Senior Management and Advisory Group), which represented around 14% of the total number of 24,250 jobs of this type that currently exist. The aim was to "rationalize the current structure of the Executive Branch and orient it towards providing services to the population efficiently". In addition, a
provisional measure was supposed to transform 10,462 freely-provided DAS positions, which can be occupied by people without a civil service exam, into commissioned functions in the executive branch, exercised by civil servants with civil service exams. This would reduce the number of people with no ties to the public service.
Privatization (ANP) holds auction to share pre-salt blocks. On 23 August 2017, the government announced the privatization of the
Brazilian Mint as part of the Investment Partnership Programme (PPI), which included 57 state assets for concession or privatization. On the same day, and also as part of the PPI, a timetable was released that provided for measures aimed at auctioning off other public assets, such as airports, motorways and port terminals. There was an estimate of R$44 billion in investments over the life of the contracts. This revenue would improve the budget situation and meet the fiscal target for the year. The government had also announced the privatization of
Eletrobras, through the sale of shares belonging to the Union, a proposal that was approved by the PPI board. On 27 September, an auction of four hydroelectric plants operated by
CEMIG generated twelve billion
reais for the federal government. The four stations account for almost 40% of the entire generation capacity of the company, which tried to suspend the auction in court. Chinese investors bought the São Simão hydroelectric plant, the largest in the tender, while a French group got the Jaguara and Miranda plants, and Chilean representatives acquired the Volta Grande plant. In
Belo Horizonte, there were protests by trade unions and social movements against the privatization. The auction took place on the São Paulo Stock Exchange. On 27 October, the government held an auction of eight
pre-salt exploration areas.
Petrobras acquired three and agreed to cede up to 80% of production to the Union, a percentage well above the minimum values proposed in the public notice and the amount offered in the Libra auction in 2013. Six of the blocks offered had bids. The auction was regulated by a sharing system, which stipulates that whoever offers the largest share of surplus oil or gas from future production to the federal government will win the bid, considering the surplus to be the volume that remains after discounting exploration costs and investments. In addition, the companies have undertaken to pay the Union a bonus of 6.15 billion
reais from the concessions sold.
Science and technology protesting against the government's cuts to science and technology funding On 12 July, Temer announced investments in scientific and technological research. There were two models, one with private resources and the other with public resources. The first would be managed by the Brazilian Company for Industrial Research and Innovation, through bodies linked to universities. The second would be managed by the
Brazilian Industrial Development Agency (ABDI), which would raise funds on the financial market and invest them in start-ups. The ministries of Science, Technology, Communication and Innovation, Industry and Foreign Trade, and Education would be in charge. However, the funds released in 2016 amounted to 500 million
reais, just 9% of what was allocated to this area the previous year. In addition, there was excessive taxation and a lack of infrastructure. In early October 2017, 23 Nobel Prize winners signed a letter addressed to Temer demanding a change in the policy adopted in the areas of science and technology. The text stated that the measures "seriously jeopardize Brazil's future" and that they needed to be revised "before it's too late", as well as mentioning that there could be "a 'brain drain', which will affect the best young scientists". The document, headed by French physicist
Claude Cohen-Tannoudji, reinforced the criticism of the 44% cut to the
Ministry of Science, Technology, Innovation and Communications' budget in 2017, as well as a possible 15.5% cut expected for 2018. The government's projected budget for 2017 was R$3.2 billion (after the 44% cut at the beginning of the year). According to the newspaper
O Globo, the amount was a third of what it had four years earlier. In 2018, the government's proposal would reduce to R$2.7 billion.
Economy At the beginning of his term, Temer announced the direction of his government's economic policy, which was based on the guidelines set out in the document
Uma Ponte Para O Futuro, drawn up by the Ulysses Guimarães Foundation. Temer's government began its term with a major public accounts crisis, inherited from the previous government. Although April 2016 recorded a primary surplus, the month of May saw a deficit – expenditure exceeding income, not including interest – of 15.49 billion
reais. This was the worst result for the month of May since the beginning of the historical series in 1997. In addition to lower revenues due to the recession, public spending in May 2016 rose 7.3% over the same month a year earlier. Total expenditure reached 480 billion in the first five months of 2016, an increase of 11.3% compared to the same period in 2015, while total revenue amounted to 544.91 billion from January to May, an increase of 3.1% compared to the same period in the previous year. It was also the first deficit recorded for the first five months of a year since the historical series began in 1997. From January to May 2016, the accounts registered an unprecedented deficit of 23.77 billion
reais. The government justified the imbalance with compulsory spending, including
Social Security. Public accounts have recorded consecutive fiscal deficits, worsening the public debt and increasing inflationary pressures. During
Rousseff's presidency, Brazil lost its so-called "investment grade" rating – a recommendation to invest in the country – which was withdrawn by the three major rating agencies (
Standard & Poor's,
Fitch and
Moody's). To contain the problem, the government managed to change the fiscal target and set a cap for public spending in Congress. Another measure was to propose a change in the social security rules, whose accounts in the first five months of 2016 totaled a deficit of 49.73 billion
reais, an 81% increase in the deficit compared to the previous year; an even greater increase of 146 billion
reais is forecast for 2017. By 2016, there had already been three consecutive years of government deficits. Cofecon also considered that there was no longer any need to maintain the basic interest rate at the current level of 14.25% per year to combat inflation. The government of Rousseff kept inflation above the target (4.5% per year) and close to the target cap (6.5% per year) throughout her first term, by interfering with administered prices such as fuel and bus fares. However, with the official inflation index registering 9% per year in May and other indices pointing to an upward trend in wholesale prices, the note said that "the tendency is already clear, that the factors that led to the rise in the inflation rate in the first half of 2015 are no longer present (strong correction of administered prices and exchange rate pass-through), that the recessionary situation eliminates any demand pressure and that the basic interest rate should therefore have been falling since the second half of 2015". The note concluded by warning of the risk of the appreciation of the national currency against the dollar, observed in the last month. "The rapid appreciation observed in recent weeks is functional for the fall in inflation, but it should once again put domestic industry in check, making it difficult to reverse high unemployment," said the eighteen members of the organization. On 24 May, Temer announced the measures to control the public debt. He declared that he was governing together with Congress and that the approval of the new fiscal target was extremely important, also emphasizing the need to maintain the tranquility of institutions. He also said that he would have to establish strict criteria for appointing the heads of pension funds and state-owned companies and that, depending on a legal assessment, there would be the possibility of the
National Development Bank (BNDES) returning 100 billion
reais it had received from the National Treasury. The government injected 500 billion
reais into the state-owned bank between 2009 and 2014, and these funds were lent to companies, charging lower interest rates than those practiced on the market. This means a state subsidy for large companies, dubbed the "entrepreneur grant". The early recovery of these resources could reduce the public debt, which stood at 67% of GDP. Another way to reduce the debt would be to collect the resources of the so-called Sovereign Fund, estimated at 2 billion
reais, which were conceived as a destination for pre-salt revenues, with the aim of relieving public accounts in times of crisis. In addition to these measures, Temer intended to impose a limit on government spending, which jumped from 14% to 19% of GDP between 1997 and 2015, affecting even health and education. He also hoped to save two billion
reais a year by prohibiting an increase in the value of government subsidies already granted, such as tax incentives. On 25 May, Congress approved the reduction of the fiscal target, authorizing the government to close the year with a deficit of 170.5 billion in public accounts. On 15 June, Temer presented Congress with a proposal for a
constitutional amendment that would limit the increase in public spending to the variation in inflation, using the previous year's inflation as the basis for readjustment. This public spending cap would be valid for twenty years from 2017, and could be revised from the tenth year of its validity. According to the government, "the PEC will, for the first time, limit the growth of public spending and contribute to the necessary structural adjustment of public accounts". In the first year, the limit on total spending would be equivalent to the expenditure paid in the previous year, adjusted for inflation in that year. The proposal included health and education in the spending limit, but excluded various expenses, such as constitutional transfers to other federal units, and extraordinary credits. It also covered expenses by the legislature and the judiciary. On 6 October, Temer announced that he would make available a credit line of 30 billion
reais for Micro and Small Enterprises (MSEs), which could be used for loans and financing for working capital, investments and equipment purchases. Of the amount announced, twenty billion would be made available by
Caixa Econômica Federal and
Bank of Brazil; the rest would come from private banks (
Bradesco,
Itaú and
Santander). In addition to increasing credit for the quarter, the measures announced would make it possible to improve the business environment in two other areas: training and reducing bureaucracy. The
Minha Casa, Minha Vida| programme was also be launched in partnership with the Ministry of Education and public and private universities, which would promote guidance in the area of business management and technical assistance to potential entrepreneurs. Another project presented was '''', aimed to reduce bureaucracy in international trade for MSEs and establish the figure of the Logistics Operator, who would be responsible for operational export procedures. On 22 November, the federal government, in a meeting with state governments, announced a national pact to balance public accounts. According to Henrique Meirelles, the Union agreed to give the states a larger share of the funds collected from the so-called repatriation, a programme that provided incentives for Brazilians to regularize assets held abroad that had not been declared to the
Internal Revenue Service. In return, the governors would commit to making a strong adjustment to their accounts, similar to the one proposed by the Temer government itself, including an increase in the social security contribution paid by civil servants. The government collected 46.8 billion
reais from income tax (IR) and fines from taxpayers who signed up to repatriation, but the states would only keep four billion of that total. The governors, however, also demanded a share of the fines. After a dispute in the Supreme Court, Temer gave in and the states would receive another five billion of the amount collected.
Philip Hammond at the Ministry of Finance On 13 December, the government announced measures to improve the country's economic situation; one of them concerned the
FGTS. When there were profits, part of them would continue to be deposited and the other half would be made available for the worker to pay off debts or make other use of. The government also wanted to reduce the 10% fine that employers had to pay when they fired workers. Another measure was the installment payment of tax debts owed to the government by companies and individuals, with the possibility of offsetting debts against certain credits. It was also announced that there would be a major reduction in bureaucracy in economic activity, with "extraordinary simplification for companies to make labour and tax payments". There would also be a new policy for loans sought by companies from the National Bank for Economic and Social Development (BNDES), with lower interest rates. Michel Temer emphasized a measure that he called "differentiation" of prices for different means of payment (credit card, cash or check). In this way, merchants would be able to grant discounts, for example, for cash payments, something that already happened today, even though it was forbidden. The measures also aim to speed up foreign trade purchases and sales. According to Minister Meirelles, a single portal would be created, accessible via the Internet, to send all the documents and data required for commercial transactions with other countries. In August, the economic expansion was confirmed. The Central Bank reported growth of 0.25% compared to the first quarter. This second consecutive quarterly increase, with a peak of 0.5% in June, convinced economists that the country was really recovering. With the new figures, Projeções Broadcast collected 28 estimates from financial market institutions for the GDP result in the second quarter of the year. The average forecast was for stability, with the expectation that it would be in the range between a fall of 0.5% and a rise of 0.30%. Despite the modest results, taking into account the strong recession of 2015 and 206, Minister Meirelles said: "The services data, combined with the retail data, job creation in the Brazilian economy and, finally, with the IBC-Br, show that Brazil is growing again".
Agriculture The government of Temer decided to continue the work of former minister
Kátia Abreu by implementing the 2016/2017 Safra Plan. The aim was to reallocate resources to technology and logistics programmes, among others, as well as recompose the budget for rural insurance and marketing. Bank of Brazil opened a credit of 101 billion
reais for the 2016/2017 harvest, which was divided into 91 billion for producers and cooperatives and ten billion for companies in the
agribusiness chain. It was part of the federal government's 2016/2017 Agriculture and Livestock Plan, which would allocate 185 billion
reais in credit for Brazilian rural producers to invest in funding and marketing, between 1 July 2016 and 30 June 2017.
Commerce On 12 July, Temer became head of the Chamber of Foreign Trade (Camex), according to a decree published in an extra edition of the Federal Official Gazette, which also increased the participation of the Ministry of Foreign Affairs in the
collegiate body. Camex had already been linked to Temer since May, when he merged and extinguished ministries and bodies. The decree has just regulated the changes to the
collegiate body, which handles Brazil's foreign trade policy. As a result, Camex' Executive Management Committee (Gecex) is now chaired by the Minister of Foreign Affairs,
José Serra. The Minister of Industry, Services and Foreign Trade,
Marcos Pereira, took over the presidency of the Private Sector Consultative Council (Conex), the body that mediates between companies and the government within the scope of Camex. In addition to foreign trade, Camex will also take care of investment promotion.
Finance and budget On 7 June, the
Chamber of Deputies approved a constitutional amendment considered essential by Temer, which allowed the federal government to freely use part of its tax revenues, the so-called Devolution of Federal Revenues (DRU). This increased the percentage that could be transferred from the revenue from all federal taxes and social contributions from 20% to 30%. The rest of the revenue would be tied to expenses defined in the budget. The measure could be applied retroactively from 1 January 2016. This would benefit the government insofar as most of the current revenues had destinations specified in the legislation. The amendment did not alter minimum spending on health and education, as well as constitutional tax transfers to states and municipalities. Another victory for the government was the
Senate's approval of a supplementary bill that avoids making up the public accounts. According to the text, the revenue forecast in the
Budget Guidelines Law (LDO) must be maintained in the
Annual Budget Law (LOA) and in the budget authorization for the following year sent by Congress to the president. With the new premise, the revenue forecast will have to be realistic, avoiding, for example, building works whose costing is postponed until years later. The bill also stipulates that the Executive must send the
Multiannual Plan (PPA) together with the LDO to the Legislature by April 30 in the first year of government, with the aim of preventing the LDO from being drawn up before the definition of investments in projects and programmes, which could also lead to a distortion between income and expenditure. On December 13, the Senate, by 53 votes to 16, approved the basic text of the
Proposed Amendment to the Constitution (PEC) that established a cap for public spending for the next twenty years. The proposal was sent by the president to Congress in June and was considered by the government to be essential for rebalancing public accounts, alongside the pension reform, while the opposition argued that the measure would freeze investment in health and education. The PEC's main goals are: federal spending will only be able to grow in line with inflation in the previous year; inflation for 2017, which would serve as the basis for spending, would be 7.2%; in the remaining years of the measure, the cap would correspond to the previous year's limit, adjusted for inflation measured by the
Broad National Consumer Price Index (IPCA); if a branch disrespects the limit, it will suffer sanctions in the following year, such as a ban on holding public tenders or granting increases; if a branch exceeds the cap, another one must compensate. Spending on health and education would only be included in the spending cap as of 2018; minimum spending on health would rise in 2017 from the current 13.7% to 15% of net current revenue and, as of 2018, these investments would be included in the spending cap and would be adjusted for inflation; Constitutional transfers to federal units, extraordinary credits, Fundeb supplements,
Electoral Justice spending on elections and capitalization expenses of non-dependent state-owned companies were excluded from the new rules; from the tenth year of the spending limit, the president could send a bill to Congress to change the calculation basis. On December 15, the PEC was enacted into law. On 22 July, Temer made official the rate of 6% for
Withholding Income Tax (IRRF) on remittances abroad for tourism expenses. Law 13,315 has a general rule of 6% for amounts remitted by individuals and companies up to a limit of 20,000
reais per month. Above this limit, the rate is 25%. In the case of travel agencies, there is no limit to the application of the 6% rate, with the exception of tax havens. For these, the rate is 25%. However, if the remittance is made by a travel agency, the rate will be 6%, with a limit of ten thousand
reais per passenger per month. Tourist agencies must also demonstrate the effective operational existence of the beneficiary of the remittance located in a tax haven. The new legislation was negotiated for two years with tourism organizations, which celebrated the new rate, even though they wanted the tax exemption. Remittances for educational purposes and health treatment remain exempt from any taxation. On 27 October, Temer signed sanctioned the bill that extends the deadline for tax debts for micro and small companies to be paid in installments, establishing new limits for companies to be included in
SIMPLES, and the salon-partner law, which legalizes the hiring of legal entities to provide services in beauty salons – such as hairdressers, barbers, make-up artists, beauticians and waxers. Created in 2006, SIMPLES aims to reduce bureaucracy and make it easier for micro and small entrepreneurs to pay taxes. With the changes, the limit for micro-enterprises to be included in the programme has gone from the current 360,000
reais per year to 900,000
reais. The cap for small businesses has been raised from 3.6 million
reais a year to 4.8 million
reais. The new version of the law extends the deadline for paying tax debts from 60 to 120 installments. The new law also creates the figure of the "
angel investor", to help
startups (companies at the beginning of innovative activities) obtain contributions to put their products on the market. In this way, it will be possible to invest without the need for the investor to become a partner in the new venture.
Education Programmes to encourage education and professionalization, such as
Pronatec,
ProUni and the
Fundo de Financiamento ao Estudante do Ensino Superior (FIES), have suspended the opening of new vacancies. The Minister of Education,
Mendonça Filho, said that he intended to honour the positions already contracted, but could not accept new applications due to a lack of resources. One of the main targets of the new education policy was the FIES, in which the government financed the study of low-income students at private universities, lending money that, after graduation, was returned by the beneficiaries. Mendonça did not intend to keep paying the bank fee (1.3 billion
reais a year) and also stressed that the ProUni would need to demand results from the students who receive public money. Education managers believed that the government could invest in major projects, but that its resources were poorly used. On 16 June, Temer signed the authorization to create another 75,000 scholarships for the FIES. The investment by the Ministry of Education (MEC), earmarked for new contracts in the second semester of 2016, amounted to 450 million
reais. This number of vacancies was made possible thanks to the replacement of 4.7 billion
reais, compared to the 6.2 billion
reais cut by the previous administration. The vacancies also represented an increase of more than 50% in the contracts signed in the first half of 2016. The new contracts changed the family income requirement from up to 2.5 minimum salaries to up to three minimum salaries, broadening students' access to university, and there would no longer be a deadline for declaring whether or not the student is enrolled in the course. In addition, there would be a time limit on the pre-selection of students on the waiting list and there would be a specific process for filling remaining vacancies. On 16 February 2017, when Temer sanctioned the high school reform law, he declared in his speech at the Planalto Palace that the new model was only possible thanks to the government's boldness in facing up to the controversy surrounding issues that are relevant to the country. According to him, "we have sent proposals that generate healthy controversy. Controversy and criticism therefore generate improvement. Certainly, some of the changes made by Congress were made by society. So we ended up with a consensus. We are daring. Who would dare to put a cap on public spending? It would be very easy for the president to come in and spend as he pleases without worrying about fundamental reforms, in other words, the country's future. We're not doing that. Proposing the cap was a very successful dare. Now, the high school reform". Education minister Mendonça Filho, added that "high school was static, with thirteen compulsory subjects. [The student] has to assimilate that content in a similar and equal way for everyone, as if each one had the same profile as the other". The provisional measure that established the new rules foresaw that the 2,400 hours of class time in total would be divided into 1,200 hours of class time dedicated to the subjects of the Common National Curriculum Base (BNCC) and another 1,200 hours of class time dedicated to the subjects that the student chose to study. The aim was to allow students to delve deeper into the areas in which they were most interested. However, the new model is risky, as it increases inequalities. With the freedom to choose what would be offered, schools in more vulnerable locations could fail to offer natural science subjects, for example – an area that systematically lacks chemistry and physics teachers. "The education departments will have the vital job of looking at the network in each region and ensuring a balance of offers. Every student should have all the alternatives in their neighborhood, if not in one school, then in the nearest one," said Ricardo Henriques, superintendent of the Unibanco Foundation. The new model of curriculum organization would be linked to the BNCC and could only be implemented once this national curriculum had already been implemented. The forecast given by the MEC is that this will happen in 2017. The choice of the flexible curriculum should only be made in 2018. On 15 December, the National Common Curriculum Base (BNCC) for primary and
preschool education was approved by the National Education Council (CNE). This document acts as a guideline for the country's entire education system and includes the following measures: religious education has guidelines on what should be taught from 1st to 9th grade; literacy should be completed by the second grade; guidelines on gender identity should be discussed by a CNE commission; municipal, state and federal networks need to rework their curricula according to the BNCC; teaching materials will have to be produced according to the new guidelines; implementation should be complete by the beginning of the 2020 school year. According to the council, "the BNCC is not a curriculum, it is a set of references on which the critical and creative process of schools will elaborate their curricular process". It was approved by twenty votes to three.
Infrastructure On 26 July,
Dyogo Oliveira,
Minister of Planning, Budget and Management, said that the government would prepare a list of infrastructure projects under the
Growth Acceleration Programme (PAC) that it considered a priority for public investment. The government intended to concentrate transfers on projects linked to the programme that were unfinished and had an estimated cost of up to 10 million
reais. Currently, there were around 2,000 projects in this situation. The measure, he said, was necessary because the government, with its accounts in the red, didn't have the resources to carry out all the PAC projects and needed to cut spending. These unfinished projects amounted to two billion
euros, which still needed to be invested. However, not all of them were paralyzed due to budget issues – there were projects that were unfinished due to lack of licences or that had had bids embargoed – and all those that didn't have technical problems would be resumed. On 10 November 2017, the '''' programme was created, with the aim of increasing public investment and resuming works that had been paralyzed. On 13 September 2016, the Temer government announced its first package of concessions and privatizations, which included 34 projects including airports, motorways, port terminals and railroads, as well as assets in the electricity, oil and gas, minerals and sanitation sectors. The aim of the federal government's concessions was to stimulate growth in the Brazilian economy, which was currently going through the biggest recession in its history. In 2015, gross domestic product (GDP) shrank by 3.8% – the most in 25 years – and in 2016 it was expected to fall by more than 3%, according to bank analysts. At the same time, the amounts collected from concessions and permits would help to close the books in 2017. The National Bank for Economic and Social Development (BNDES) and the
Investment Fund of the Length-of-Service Guarantee Fund (FI-FGTS) would contribute 30 billion to help finance the Investment Partnership Programme (PPI). Other sources would be the Bank of Brazil, private banks and possibly new investors. On 10 March 2017, Temer inaugurated the eastern axis of the
São Francisco River transposition in the cities of
Sertânia, Pernambuco, and
Monteiro, Paraíba.
Housing policy Temer and the Minister of Cities,
Bruno Araújo, announced the ''
, meant to benefit 15 million Brazilian families currently living in precarious housing. According to the minister, the target audience was families with an income of between zero and three minimum wages, who would benefit from up to five thousand reais'' (with funds from the National Treasury) for the purchase of building materials for housing improvements. The new programme would allow, among other reforms, the construction of bathrooms or sanitary pits, enlargement of the home, improvement of the roof, plastering and improvement of the floor. In the minister's words, "It will be a successful programme, very important for improving the lives of millions of Brazilians". The government also announced the resumption of construction work on 10,609 housing units under '''' aimed at the low-income population, covering 35,000 units; and that, in 2017, it would contract 600,000 new units under this social programme. According to minister Araújo, the contracting of units for families with a gross monthly income of up to R$2,350.00 and who have the capacity to compromise their income, was also being released. Under the new programme, families can count on subsidies of up to R$45,000, depending on their income and the location of the property, as well as reduced interest rates for financing, using almost exclusive resources from the FGTS. On 6 February 2017, the government redefined the income brackets for its low-income housing programme. With the new policy, family income has been extended to between 1,800 and 9,000
reais. Another measure was to raise the cap on the value of properties that can be purchased under ''
: from 225,000 to 240,000 reais
in the Federal District, São Paulo and Rio de Janeiro; and from 170,000 to 180,000 reais'' in the capitals of the
North and
Northeast. Extending the ranges would require an increase in the budget of R$8.5 billion for subsidies and financing. R$200 million would be paid by the Federal Government, destined for subsidies in categories 1.5 and 2; the FGTS would contribute R$1.2 billion for allowances; and another R$7.1 billion would be needed to finance all categories. The main objective of the provisions was to increase job creation and the goal was to contract 610,000 new housing units in all the MCMV modalities in 2017. The Minister of Planning, Dyogo Oliveira, denied that the government's recent permission for workers to withdraw amounts from inactive FGTS accounts would reduce the volume of resources from the fund earmarked for housing finance.
Justice and human rights policy On 23 June, Temer signed a bill that regulated individual and collective
injunctions. According to the text, once the injunction has been recognized, the courts must set a deadline for the creation of the required standard. It also specifies that, until such time as the law is created, the court's decision will apply only to the plaintiff and will define the conditions for exercising this right. In collective cases, the effects of any decision will only be extended to the individual plaintiff who withdraws from the case within thirty days of the case being decided. The law also opens up the possibility for the rapporteur of the action to decide, monocratically, after the case has become final and unappealable, if necessary, whether the decision will be binding. This decision can be reviewed if there is a change in fact or law. Temer said that the amendment guarantees that citizens can enjoy their rights by preventing the omission of a regulatory authority from violating rights indefinitely. On
International Women's Day, 8 March, Temer delivered a speech that caused negative repercussions. He said that women are important for the economy because "no one is more capable of pointing out price differences, for example, in supermarkets than women" and added "how much women do for the house, how much they do for the home, what they do for their children". Contrary to official data from research institutes, the president said that there is equality in employment between men and women and that women have a large share of senior positions in companies and in the legislature. The content of his statement caused fierce reactions on social media and from women in political positions. In his defence on Twitter, he declared that "My government will do everything to ensure that women occupy more and more space in society and (...) have equal rights at home and at work. We will not tolerate prejudice and violence against women".
Public security Following an episode of gang rape in
Rio de Janeiro, Temer announced that he would create a department in the
Federal Police to deal with this type of crime. "I repudiate with the utmost vehemence the rape of the teenager in Rio de Janeiro. It is absurd that in the 21st century we have to live with barbaric crimes like this. Our government is mobilized, together with the Rio de Janeiro Public Security Secretariat, to ascertain responsibility and rigorously punish the perpetrators of the rape and the dissemination of the criminal act on social networks," said Temer in a public statement. The department would function like a
women's police station and would aim to gather state information and coordinate actions across the country. In addition,
Fátima Pelaes would be appointed to the Women's Secretariat, since the corresponding ministry has been abolished. In January 2017, a crisis broke out in the Brazilian prison system following
riots by prisoners belonging to rival factions in the country's northern region. On 1 January, 56 prisoners were killed after a rebellion at the
Anísio Jobim Penitentiary Complex (Compaj) in
Manaus, Amazonas. Members of two rival drug trafficking gangs, the
Primeiro Comando da Capital (PCC) and the
Família do Norte (FDN) – allied to the
Comando Vermelho (CV) – clashed in what was considered the most violent massacre in the history of the Brazilian prison system since the
Carandiru massacre, in 1992. Five days later, 33 prisoners were killed at the Monte Cristo Agricultural Penitentiary, located in the rural area of
Boa Vista, in
Roraima. According to the newspaper
Folha de S.Paulo, the massacre in Roraima was the PCC's response to the rebellion led by the FDN in Amazonas. On 5 January, Temer commented for the first time on the prison riot. In a meeting with ministers, he initially expressed solidarity with the families of the prisoners killed in what he classified as an accident in Manaus. According to the president, although public security is the responsibility of state governments, the reality requires national intervention. He recalled that the Manaus prison is outsourced, so there was no direct responsibility on the part of state agents, but he stressed that they should have kept information about the event, like the Ministry of Justice, which did so from day one. Temer announced the first measures of the National Security Plan, including the construction of five federal prisons for high-risk criminals. The government should release around R$40 million to R$45 million for each prison. In addition, of the R$1.2 billion from the penitentiary fund released the previous week, R$800 million would be earmarked for the construction of penitentiaries in each state. Each prison should have separate blocks: one for the most dangerous prisoners and another for the least dangerous. They would have to serve their sentences in separate places, which was not the case in all penitentiaries. He also released money for the purchase of equipment to block cell phone signals in prisons. According to Temer, the jammers should be installed in at least 30% of the jails in each state where they have been requested. On 11 June, faced with the current crime crisis in the country, Temer approved the law that created the
Unified Public Security System (SUSP) and signed a provisional measure to direct part of the proceeds from the federal sports
lotteries to spending on combating violence and crime, ensuring a contribution of 800 million
reais to the budget for the year. The SUSP would aim to integrate intelligence information on crime and standardize the formatting of data, such as police records. State public security forces, both the civil and military police, would act jointly in operations with federal agencies. To maintain the system, the National Public Security Fund should receive an estimated 4.3 billion
reais from lotteries, including some to be created, by 2022. The Provisional Measure also dealt with the creation of a graduate school in security knowledge and a national data institute.
Social security Social assistance Marcela Temer speaks during the signing of a cooperation agreement with universities on the '''' programme Michel Temer declared that he intended to continue investing in existing social programmes, such as '
. In addition, he launched the ' programme aimed at provising in-person care for all children of '
beneficiaries. The plan included the hiring of 80,000 people with complete high school education and a cost of R$2 billion a year, with the goal of providing assistance to children up to the age of three, covering a period considered vital for cognitive development. The professionals hired were called ', because they would enter the homes of people who received the Bolsa Família, with a target of six homes for each
visitador in one working day. The total number of beneficiaries of the programme would reach 13.904 million families in four million homes. In poorer environments, it is very difficult to stimulate children in early childhood. The repercussions can be devastating for the rest of these individuals' lives, who sometimes end up having problems with literacy and social interaction. On 31 October, Temer announced the launch of a social programme called '''', which consisted of a credit line of up to R$5,000 for families to renovate their homes or do small jobs. "If this is achieved, naturally imagine the following: the guy has his property there. He'll want to enlarge a room or cement the house or enlarge the bathroom, and for that we're launching the so-called '
," said the president. According to the Ministry of Cities, the funds for the programme came from the federal budget and the families who benefited would not have to return the money to the government. For 2017, the government planned to set aside R$300 million for '. The government's aim was to improve the quality of housing in so-called consolidated occupations, i.e. those neighborhoods that were born out of an irregular occupation, but which have existed for many years. Beneficiary families would receive support from an architect and engineer, who would verify the specific needs of each home.
Social welfare The then Minister of Finance, Henrique Meirelles, said that he intended to defend a minimum age for claiming the benefit, for both men and women, probably 65. He said that the current pension system was not sustainable and was at risk of not being able to pay benefits to people of retirement age. For him, the pension reform was urgent so that the government could honour its commitment in the future. The minister's statement came in the wake of a new study by the
World Health Organization (WHO), which pointed out that life expectancy has increased by five years worldwide in the last fifteen years. In 2016, the average retirement age was 57, compared to 64 for Europeans. The
INSS deficit was expected to reach R$116 billion in 2016. , participates in a meeting with Temer and the economic team, to discuss the Social Security reform proposal. On 5 December, Temer presented Congress with a
proposed constitutional amendment for pension reform, whose most important point was retirement at 65 for men and women. The military would have a separate proposal and rural workers would still have to discuss their condition. States and municipalities could join Funpresp. The government's stated aim was to try to maintain the sustainability of public accounts, in the face of a growing deficit in the Brazilian pension system, due to an ageing Brazilian population and a fall in the country's birth rate. There would, however, be transitional rules for men over 50 and women over 45. "No more small reforms. Either we face up to it [the need to reform Social Security] or we will condemn pensioners to knocking on the doors of the public authorities and receiving nothing [in the future]," declared the president. On 24 November 2017, the government presented an alternative proposal, which included a transition rule. The text sent to Congress incorporated: an additional 30% contribution time on top of the thirty years of contribution for women and thirty-five years for men; a retirement value dependent on contribution time, reaching 100% only with forty years of contribution; a stricter rule for civil servants, starting at 55 for women and 60 for men, with the guarantee of full benefit only with the minimum contribution time of forty years; and a progressive minimum age. This age would be 53 for women and 55 for men. It would gradually rise to 62 for women and 65 for men, with the transition ending in 2036 for women and 2038 for men. With the approval of the proposal, those who were close to retiring under the current rule could use the transition rule to retire earlier. In February 2018, Michel Temer suspended the progress of his pension reform bill in Congress.
Labour policy On 22 December, the government presented its labour reform proposal. One of the measures was the authorization to withdraw inactive accounts from the
Length-of-Service Guarantee Fund (FGTS) to mobilize the economy. The National Employment Protection Programme was made permanent and renamed the Employment Insurance Programme. Working hours could be extended to up to twelve hours a day and temporary employment contracts would be extended from 90 to 120 days. There could be two contract models, one based on productivity and the other on hours worked. Credit cards would undergo changes, with lower interest rates and installments. Labour minister,
Ronaldo Nogueira, stated that there was no intention of altering rights acquired in the
Consolidation of Labour Laws (CLT), such as holidays, thirteenth salary, FGTS and transportation and meal vouchers, nor paid weekly rest. On the other hand, the
Unified Workers' Central (CUT) emphasized that the new legislation established the sovereignty of negotiated over legislated, which means that employers and employees would be free to promote negotiations without regard to labour legislation. Minister
Eliseu Padilha, of the
Civil House, explained the points of collective bargaining that could acquire the force of law: splitting holidays into up to three installments, with at least two consecutive working weeks between two of these installments; agreeing to a limit of 220 hours in the monthly working day; the right, if agreed, to a share in the company's profits and results; the formation of an hours bank, with the conversion of the hour that exceeds the normal working day being guaranteed with a minimum increase of 50%; time spent on the journey to and from the workplace; establishment of a break during the working day of at least 30 minutes; establishment of a job and salary plan; remote working; remuneration for productivity; provision for extending the effects of a rule even after its expiration date; entry into the unemployment insurance programme; recording of working hours. The government's proposal maintained the standard working day of 44 hours a week, plus four hours of overtime, with the possibility of up to 48 hours a week. However, the working day could be up to 12 hours (eight plus four extra hours) as long as the limit of 48 hours per week was respected. On 11 July 2017, the Senate approved the government's proposal, but with restrictions. Negotiations between companies and workers now take precedence over the law on certain items, such as split holidays, flexible working hours, employee profit-sharing, lunch breaks, job and salary plans and time banking. However, items such as FGTS, minimum wage, 13th salary, unemployment insurance, social security benefits and maternity leave cannot be negotiated. The list of changes is very broad, affecting employment contracts on many points and establishing new rules in the
labour court. On 10 November, as promised, the government sent proposals for adjustments to the new legislation to Congress. The changes concerned the following items: working hours; off-balance-sheet damages; leave for pregnant women and infants; exclusive self-employment; intermittent work; employee representation in the workplace; and collective bargaining. The president intended to use a bill to avoid the excessive use of provisional measures, which was criticized by the president of the Chamber,
Rodrigo Maia, but the senators wanted to use this legal instrument because it was part of the agreement that passed the original text so that it could go back to the Chamber. On 14 November, a provisional measure was issued to fulfill the agreement with the Senate. As a result, the reform took immediate effect, which would not have happened if it had been discussed by means of a bill. Six months after the change in legislation, the first results could already be seen. At least 41,000 workers withdrew their FGTS to be dismissed by mutual agreement with their employers. Labour claims and lawsuits fell by around 45% because the costs became higher for workers, who felt inhibited. A similar drop occurred in claims for moral damages. Hiring for intermittent periods was much lower than expected, with few new jobs being created, just 15,000 instead of 55,000 per month. Trade union revenue fell sharply, despite legal action by the organizations to maintain collection. Collective agreements did not materialize as the government had hoped, and there was a drop when comparing the annual periods before and after the law. Unemployment rose after the reform began, despite greater flexibility in creating vacancies. The provisional measure aimed at perfecting the reform lost its validity before the vote and caused legal problems due to the effects already produced. On 15 May, the Ministry of Labour published its view of the new legislation in the Official Gazette. In the form of a legal opinion prepared by the
Federal Attorney General's Office, the document stated that the labour reform was valid for all employment contracts governed by the Consolidation of Labour Laws, including those that began before it came into force in November 2017. The opinion did not have the force of law, but was merely a guideline for ministry officials, who have a duty to monitor the application of the legislation. Meanwhile, the Federal Supreme Court began discussing the first case challenging the constitutionality of the new law. The justices were assessing whether a worker who is considered poor and entitled to free legal aid would be obliged to pay the costs of the case in the event of a defeat, as established by the reform. In addition, the Superior Labour Court was considering a case that questioned the scope of the new labour law, whether the rules would apply to new employment contracts as well as those signed before the law.
Outsourcing On 22 March 2017, the House of Representatives approved a bill that allowed the outsourcing of work in any type of activity, no longer just in middle activities. By way of example, a school could hire both cleaners and teachers through outsourcing. The outsourced company would be responsible for hiring, paying and managing the workers. The contracting company would have to guarantee the safety, hygiene and health of the outsourced workers. Temporary employment contracts would be extended from three to six months and the dismissed worker would only be able to do the same job again after three months. This bill was sent to Congress in 1998 and was amended in the Senate in 2002, after which it returned to the Chamber; there were protests. Temer enacted two provisional measures: MP-739 of 2016, which decreed that, at any time, beneficiaries of sickness benefit and disability retirement could be summoned for new examinations; and MP-767 of 2017, which modified social security legislation to stipulate a new time count, for the purpose of waiting periods for the granting of sickness benefit, disability retirement and
maternity pay, in the case of new affiliation to Social Security. After 120 days, MP-739 lost its effectiveness, and MP-767 resumed the comb-fine on 16 January 2017, after Bill 6427/2016, which legitimized the analysis, was not processed in Congress due to the parliamentary recess. The provisional measures also provided for "extra" remuneration for the experts, in the form of a bonus of R$60.00 per examination carried out. In 2017, this policy was made official with Law 13457/17, approved by Congress, amending the 1991 law. Also that year, the BPC-LOAS benefits were combed through, focusing on people who had not registered with the
CadÚnico for more than two years. Around 80% of sickness benefits were cancelled, and 30% of disability pensions. The government cancelled 9.6 billion in benefits.
Environmental policy On 21 October 2017, Temer signed a decree granting a discount on fines for environmental crimes. The act was implemented in
Mato Grosso do Sul and gave a discount of up to 60% on Ibama fines, with the remaining 40% being paid for through reforestation or recovery of degraded areas, as indicated by the government.
Sarney Filho, the
Minister of the Environment, justified this benefit on the grounds that it would encourage rural landowners to pay their debts to
Ibama, thereby raising four billion
reais. However, it was thought that the government's act was a way of getting the votes of the 200 ruralist deputies, on the eve of the second vote on the Attorney General's complaints against Temer. == Foreign policy ==