Senior official says proposed budget cuts, which have been protested in violent street clashes, are ‘lacking in all nuance and compassion’

This article is more than 3 years old

This article is more than 3 years old

Brazil is poised to implement the most socially regressive austerity package in the world, a senior United Nations official has warned.

Despite violent street protests against budget cuts, President Michel Temer – who came to power after engineering the impeachment of his former running mate, Dilma Rousseff – is pushing through a 20-year social spending freeze that will be locked into the constitution.

Ahead of a final senate vote on the measures next Tuesday, the UN special rapporteur on extreme poverty and human rights, Philip Alston, took the unusual step of decrying the plan as an attack on the poor – and a violation of Brazil’s obligations under the International Covenant on Economic, Social and Cultural Rights.

“This is a radical measure, lacking in all nuance and compassion,” he said in a statement on Friday. “It is completely inappropriate to freeze only social expenditure and to tie the hands of all future governments for another two decades. If this amendment is adopted it will place Brazil in a socially retrogressive category all of its own.”

The constitutional amendment, which is known as PEC55, solidifies fears that Temer’s rightwing government will jerk Brazil back towards its historical position as one of the most unequal countries on the planet.

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That reputation had somewhat softened after 13 years of Workers’ party rule, which saw increased spending on healthcare and education, and modest income distribution measures.

But since Temer conspired to eject Rousseff from the presidency, he has switched priorities towards creditors in an effort to restore investor confidence and improve Brazil’s battered financial ratings.

As a result the state will shrink rapidly and a greater share of tax revenues will go to bond holders.

PEC55 goes far further than austerity policies in other nations, according to Pedro Paulo Zahluth Bastos, associate professor in economics at the University of Campinas.

Bastos notes that only Singapore and Georgia hard-wired cuts into their constitutions – and even then not so deeply or for such a duration.

Given how inflation is benchmarked, he estimates education spending per child will fall by almost a third, and health outlays per patient will decrease by almost 10%. While social spending declines as a share of GDP, he says the demands will increase because of an ageing society and the forecast addition of 20 million people to the population.

Yet interest payments will remain generous: all future gains in taxation will be destined to the payment of public debt. And Brazil will remain one of the only countries in the world without a dividend tax or an income tax for company owners.

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“Nothing like this has been executed in any other place in the world,” Bastos said. “This is the most contractionist state and at the same time the most beneficial program for the holders of public debt in the history of humanity.”

There has been little public debate considering the importance of a measure that will affect the country until 2037. Polls suggest less than half of the population have heard of PEC55.

None of them voted for it because Temer was elected vice-president in 2014 on Rousseff’s coattails and a promise of no austerity.

Adding to frustrations, the government remains mired in a corruption scandal with dozens of senior politicians implicated in the ongoing Lava Jato (Car Wash) investigation into bribery and kickbacks at the state run oil company Petrobras.

Three ministers have resigned from the cabinet of Temer, who is also accused. To public fury, the head of the upper house, Renan Calheiros, refused to comply with a supreme court judge’s ruling that he step down to answer charges earlier this week, and has subsequently struck a deal with other justices that enables him to cling to power.

Social tensions are already evident. Police used teargas and rubber bullets when more than 10,000 protesters rallied outside Congress during an earlier stage of voting on the bill.

Local government budget cuts and salary delays have also prompted violent demonstrations on other cities. The latest erupted in central Rio de Janeiro on Monday, when office workers and shoppers got caught up in clashes between riot police and striking firemen, police and other state employees.

“We are losing jobs and incomes so we have a right to protest, but the government responds with violence,” said Pedro Oliveira, as teargas swirled through the city streets.

Jorge Darze, the president of the Doctor’s Union of Rio de Janeiro, said he was worried both by the cuts to an already underfunded health system and the breakdown of dialogue between social organisations and the authorities.

“The situation is very serious,” he warned. “It is very difficult to discuss, because the legislative militarises its entrance and the public prosecutors office has turned its back. This austerity package is far from solving the economic crisis, and I think it will worsen the social crisis.”

