Brazilian Congress

The average salaries of the public service sector rose in real terms (above inflation), 33% between January 2003 and January 2016, while in the private sector, the increase was 10%. The survey, conducted on the basis of official data crossing the legislative consultant of the Senate Marcos Köhler, confirms the complaints of the federal government, governors and mayors on the cost of the increase in the payroll of the servers in public spending. In 13 years, it jumped from about R$880 to R$1,650 in average disparity between earnings of a state official and a professional in private sector.

The government of President Michel Temer tries to pass a Constitutional Amendment Proposal (PEC) which limits public spending in order to harness the growth of expenditure inflation last year. The measure aims to prevent, among other things, real increases in public service payroll growth, thus containing the explosion of budget deficits that have been recorded in recent years.

The comparative study of Köher with compiled data from the Monthly Employment Survey (PME), the Brazilian Institute of Geography and Statistics (IBGE) show that the average monthly income in 12 months of public service was R$2,897 in early 2003. The growth, mostly linear, only recorded three falls in the periods of 2004, 2014 and 2016, when it reached R$3,860 – high of 33.24%. In the private sector, in turn, wage growth was slower and lower, rising from R$2,012 in early 2003 to R$2,210 in January this year, an increase of 9.84%.

Growing gap – The survey indicates that the difference between the average income of the public and private sectors between 2003 and 2016 almost doubled, with fall intervals in the second year of the Lula government in 2004 and the beginning of the second term of Dilma Rousseff, in 2014. The wage gap between the categories of workers reached 75% – it was 44% at the beginning of the series.

Other data shows the weight of the cost of public servers. Employees of the 10 categories with highest salaries in the public sector, which amount to a quota of 255,000 people – in the three levels of government – earn on average R$272,000 annually. The approximately 36.8 million employees of private companies receive annually R$23,300 on average.

For the consultant, the Achilles heels of the fiscal problems that the Union and the States are facing is the salary of functionalism issue that causes direct impact on public security, since the pension benefit is paid, generally, in its entirety. Köhler argues that the most effective measure to end the successive budget deficits would be temporary freezing of servers increases, in order to reduce the public debt.

Opposition – A constitutional change that considered this measure, said the consultant, would be politically easier to approve. He argues that there is an opposition to the PEC ceiling, claiming that investment reduction will be also in the areas of Health and Education with its eventual introduction.

“The rule of the wage freeze would be simpler, would not have popular opposition and would be easier to verify the fulfillment of it, and be less unfair and less dangerous,” said Kölher, which was assigned to work in Senator’s José Aníbal cabinet (PSDB- SP).

Carlos Monteiro is a Brazilian citizen, graduated in Business Administration by the Catholic University of São Paulo. He lives in Odense, Denmark with his Danish Wife, Cathrine, and their half Danish /Brazilian daughter Ines Marie. You are very welcome to be in contact him at any time.

Leave a Reply