Brazil’s top pros­e­cu­tor urges Congress to shelve spend cap

Kuwait Times - - BUSINESS -

Brazil’s Pros­e­cu­tor-Gen­eral’s Of­fice on Fri­day ques­tioned the con­sti­tu­tion­al­ity of Pres­i­dent Michel Te­mer’s pro­posed pub­lic spend­ing cap and rec­om­mended that Congress shelve the aus­ter­ity mea­sures. The of­fice said in a state­ment the pro­posal in­ter­feres with the au­ton­omy of other fed­eral pow­ers and would weaken the coun­try’s ju­di­cial sys­tem, hand­i­cap­ping ef­forts to com­bat cor­rup­tion. “The pro­posal in­vades the ju­di­cial sys­tem bud­get­ing com­pe­tence dras­ti­cally, risk­ing im­pact­ing the ex­er­cise of its con­sti­tu­tional and in­sti­tu­tional func­tions,” said the state­ment.

The un­prece­dented con­sti­tu­tional amend­ment, which lim­its the growth of fed­eral spend­ing to the rate of in­fla­tion for 20 years, is aimed at grad­u­ally clos­ing a yawn­ing bud­get gap that topped 10 per­cent of gross do­mes­tic prod­uct (GDP) last year. It is the first of a se­ries of aus­ter­ity mea­sures to as­suage mar­ket con­cerns that the once-boom­ing econ­omy, which was stripped of its in­vest­ment­grade rat­ing last year, could be hurtling to­ward a debt cri­sis. A lower house com­mit­tee ap­proved the pro­posal on Thurs­day, hand­ing Pres­i­dent Michel Te­mer an ini­tial vic­tory on the bat­tle to pass the amend­ment. Its ap­proval re­quires two votes in the ple­nary of the lower house and two more in the Se­nate, need­ing a three-fifths ma­jor­ity in each. A first vote in the full lower house cham­ber should take place early next week. —Reuters

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