Brazilian government plans 5% salary increase for civil servants from July -sources By Reuters

© . FILE PHOTO: Brazilian Economy Minister Paulo Guedes speaks at a Banco do Brasil credit launch ceremony for truck drivers in Brasilia, Brazil, April 7, 2022.REUTERS/Adriano Machado By Bernardo Caram BRASILIA () -The Brazilian government is proposing a 5% salary increase to the board officials from July in an effort to end protests and strikes affecting public services, three sources at the economy ministry said Wednesday. According to two of the sources, who have asked for anonymity to discuss private deliberations, the increase will cost the federal government about 6 billion reais ($1.28 billion) this year. Brazil has a constitutional spending cap, so the government will have to cut other spending to raise salaries as Congress approved the 2022 budget with just 1.7 billion reais for such increases. The government had also analyzed options within that limit, including increasing meal vouchers by 400 reais ($85) for all employees, a possibility they largely rejected. Another alternative was to favor a few categories of officials, including those from the central bank and the tax authorities, who led vociferous protests after President Jair Bolsonaro said earlier this year that only public safety officials should be allowed pay increases. receive. Behind the scenes, Commerce Department officials vehemently opposed that idea, arguing that favoring a few could spark a wave of new protests demanding more expensive hikes. “The biggest problem was giving raises to one category and not the other,” says one of the sources familiar with discussions. Many civil servants have not seen their wages rise in five years and protests have erupted as double-digit inflation eroded purchasing power in Latin America’s largest economy. A strike by central bank employees is delaying the release of economic data, while protesting tax inspectors have delayed processing of goods arriving in Brazil. ($1 = 4.6899 reais)

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