For the AGU, the PEC for financial independence of the central bank is unconstitutional

The proposed amendment to the Constitution (BEC 65/2023) which grants financial and budgetary independence to the Central Bank (BC) is considered unconstitutional by the Attorney General's Office (AGU).

The body, which represents the union and is responsible for providing legal advice to the executive authority, monitored the progress of the project in the National Congress, according to the newspaper’s information. Folha des Paulo.

PEC would transform BC, a federal agency with a budget linked to the federation, into a public corporation with full fiscal and budgetary autonomy, under Congressional supervision. BC will have complete freedom to determine, for example, career plans, salaries of its employees, hiring and adjustments.

Currently, the text is being processed by the Senate Constitution and Justice Committee, and it has easily passed the approval needed to begin processing, with a total of 42 signatures among 81 senators. If he succeeds in the council, he will need 49 votes in two rounds of voting in the plenary session. After that, it still has to pass two votes in the House of Representatives – which also requires a minimum of 3/5 (i.e. 308 MPs) support in each.

In practice, this proposal expands the European Commission's operational independence established three years ago. In 2021, President Jair Bolsonaro (PL) approved the project, which was approved by the legislature, making BC independent in its work, limiting the ability of the executive to influence decisions on monetary policy. Since then, the term of office of the President of the BC and the President of the Planalto Palace has not been the same. Now, the mayor always takes office on the first business day of the third year of each government.

To date, the federal government has not officially commented on PEC 65/2023. At the beginning of February, the Minister of Management and Innovation in Public Services, Esther Dweck, admitted that the executive had been surprised by the presentation of the text. Finance Minister Fernando Haddad (PT) and President Luiz Inacio Lula da Silva (PT) have not spoken publicly on the issue. However, BC President Roberto Campos Neto is known to be enthusiastic about the project.

The AGU monitors the progress of the Senate PEC, mainly because the Attorney General's offices and legal departments of authorities such as the BC are linked to the body. According to the AU, the PEC would have an “initiative defect” because it would usurp the powers of the executive by proposing to Congress changes in the administrative structure of the BC and in the jobs and salaries of civil servants.

Another obstacle pointed out by the Arab Gulf Union is the power that will be granted to the monetary authority to fine financial institutions supervised by the central bank. As a public company, according to the Arab Gulf University, the bank cannot fulfill this role.

The reporter says he's optimistic

In an interview with Money informationSenator Plinio Valerio (PSDB-AM), text rapporteur at the Caribbean Court of Justice, has expressed optimism about the progress of the Senate PEC, regardless of the support or lack thereof of the Federal Government. He is expected to give his opinion in early June.

The senator reveals that he held talks with employees of the Monetary Authority and with Campos Neto himself. But the government's participation in the discussions is almost non-existent so far, according to the MP.

“The PEC will continue, regardless of the government. I will submit the report and then don’t come and say the government has not been heard,” Valerio says. “The truth is that the government has already lost a lot of members of Congress. Those who should participate are Rodrigo [Pacheco, presidente do Senado] And the [Arthur] Lira [presidente da Câmara]. I will do my part and express my opinion.”

“I said to both the BC staff and the managers who have already met with me: Tell me exactly what concerns you about the PEC and what you would like to see in the text. Then I will organize it,” assures the Senator. “We have to find this balance point. Here no one will determine complete autonomy, and the government is left without any participation. The ideal solution for me is the Suleimani decision. The government will continue to dictate monetary policy, the Bank of Colombia will implement this policy and the Federal Senate will continue to monitor it.

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