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Central government posts primary deficit of R $ 14.7 billion in May

Public Accounts

After approval of PLN 4, insufficiency for the golden rule fell from R $ 264.9 billion to R $ 93.7 billion in 2020

The result of the central government's public accounts for May (Treasury, Central Bank and Social Security) was a deficit of R $ 14.7 billion, compared to a deficit of R $ 11 billion in the same month last year. The number was released on Wednesday (26/6) by the National Treasury.

In the accumulated of the year, until the last month there was a deficit of R $ 17.5 billion, while in the same period of 2018 the registered deficit was R $ 15.2 billion.

Commenting on the monthly result, Secretary Mansueto Almeida recalled that in May last year the central government accounts had an atypical revenue of R $ 3.5 billion from the Sovereign Fund. "If we isolate this effect, we would have a similar result between the two years," he said.

On the accumulated result, the Treasury secretary pointed out that despite the 0.5% loss in revenue this year, contrary to the 8.2% increase in real revenue between January and May 2018, the deficit of the two periods are similar (difference of R $ 2.3 billion).

 "There is nothing to celebrate because we have come from successive deficits. But within this current context, where revenue is not growing, the deficit has not only worsened because we had a fall in primary spending of almost 1%, "Almeida noted.

In the 12-month period, the central government's deficit is R $ 125.2 billion, equivalent to 1.76% of GDP. The target for 2019 is a deficit of R $ 139 billion, equivalent to 1.92% of GDP.

Social Security

Until May, Social Security registered a deficit of R $ 80.7 billion, while the National Treasury and the Central Bank were surpluses of R $ 63.3 billion. By adding the pension of federal public servants and the expense of inactive and military pensioners, the deficit reaches R $ 296.7 billion in the accumulated 12 months until May.

The projection is that the deficit of these three groups will reach R $ 314.9 billion at the end of 2019, which represents 4.4% of the country's Gross Domestic Product (GDP).

The secretary recalled that spending on social security and other compulsory expenses, such as spending on personnel, has been making room for investment. According to Treasury projections, such behavior will lead to discretionary expenses totaling R $ 97.6 billion at the end of 2019, the lowest level of the historical series started in 2009.

In this sense, Mansueto Almeida reinforced the need for approval of the New Pension Plan, stressing, however, that the recovery of public accounts will be slow and gradual even after pension reform.

Golden Rule

The approval of the supplementary credit by the National Congress, through the PLN 4/2019, allowed the government to use the positive results of the Treasury / Central Bank and the early repayment of credits with the BNDES to partially cover the insufficiency of the margin of the Gold Rule in With R $ 93.7 billion still to be covered, compared to R $ 264.9 billion estimated in April.

In the 12-month period up to May, capital expenditures exceeded revenues from credit operations by R $ 102.7 billion. The current projection shows a sufficiency margin of R $ 1.8 billion for compliance with the rule in 2019.