Brazilian budgetary process: problems, causes and recommendations

Abstract

The Brazilian new Constitution introduced a number of changes in the budgetary process, mainly in terms of enlarging Congress roles in such process and in terms of strenghting the linkages between planning and budgeting. After six years under the new order, the assessment of the budgetary process shows a set of problems and inadequacies that requires correct.ve actions. This article analyses 14 situations, which were considered as  detrimental to the budgetary process, and points out their causes, their main effects and some ways to overcome them. These situations are: 1) the frequency of changes in the federal govemment structure; 2) the concurrent roles offederal, state and local governments; 3) the flexibility granted to the Executive to change its budgetary proposals; 4) the power of government to impound funds. 5) the impropriety of legislating on budget matters through "medidas provisórias"; 6) the ineffectiveness of the "plano plurianual" to guide the government programming; 7) the underutilization of the LDO as a policymaking device; 8) the unclear separation between the Fiscal and the Social Security budgets; 9) the imperfections ofthe public enterprises capital budget; 10) the inadequacies in the budget formulation process and calendar; 11) the impropriety of "medidas provisórias" to authorize supplemental appropriations; 12) the excessive centralization of powers in the Joint Budget Committee - JBC; 13) the lack of a stafling structure of its own in the JBC; 14) the deficiencies of Congress in budget controlling and assessment.