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Discretionary expenses fall 24% in the first half compared to the same period of 2018

Federal budget

Health, Education and Transport were areas that lost most resources, damaging public policies

Rising federal government spending, especially personnel and pension spending, has led to a 24% reduction in discretionary spending in the first half of 2019 compared to the same period of the year, points out the Macrofiscal Bulletin prepared by the Secretariat of Policy. Economical Discretionary are those expenses in which the manager is free to define the allocation of resources according to needs.

Among the functions that suffered the most are the areas of Health, Education and Transport whose budgets fell by more than 30% in the first six months.

In addition to these three areas, 17 other government functions suffered budget losses when compared to the first six months of the two years. In 2019, the Union's discretionary spending is at its lowest level since 2008, when the historical series began.

New Revenue
According to Under-Secretary of Fiscal Policy of the Ministry of Economy, Marco Cavalcanti, the federal government has been looking for ways to rebuild the discretionary budget by the end of the year.

“We are working to make new revenues viable by 2019,” he noted, noting that currently more than 93% of the federal primary budget is effectively composed of mandatory expenditures.

In the first half of 2019, total discretionary expenses stood at R $ 43.9 billion, while in the same period of 2018 it exceeded R $ 57.4 billion. The Health area was the one that lost the most discretionary budget in the period, falling from 16 billion between January and June 2018 to R $ 9.2 billion during the same months of this year.

These differences are due not only to the general tendency for discretionary spending to be driven out by mandatory advances, but also to the additional control of spending in 2019 in the face of the downward revision of GDP growth and federal revenue projections.

The reduction in discretionary spending has negatively affected the execution of various public policies across a broad range of elements, ranging from consumables in education to investments in the area of ​​transportation.