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Brazil pension reform on track to pass by June: speaker

Kitco News

NEW YORK (Reuters) - Brazil’s pension reform process will pick up momentum after the Easter holidays, staying on track for approval in the lower house in May or June, the lower house speaker Rodrigo Maia said on Thursday.

Speaking at a conference in New York, Maia said he was also optimistic the final bill would generate the 1 trillion reais ($260 billion) in savings over the next decade the government is seeking. While it might be passed 15 to 30 days later than hoped for, the delay will not matter, he said.

Central to the government’s ability to get its signature economic reform through Congress is communication and dialogue between the government of President Jair Bolsonaro and lawmakers, which until now has been poor, Maia said. But with Bolsonaro now sitting down and talking with party leaders, it is improving.

“Dialogue, arguing the case for pension reform, showing how it will affect business in Brazil, investment, employment, public-private partnerships - that’s what the government has to do so that lawmakers are comfortable in voting for pension reform,” Maia told reporters on the sidelines of the conference.

Some elements of the bill, such as changes to retirement benefits of rural, elderly and disabled workers, have generated strong opposition among lawmakers. But while they may be debated strongly and even modified, these elements are unlikely to significantly alter the bill’s ultimate savings goal, Maia said.

He expects Congress to engage in “very positive” dialogue once lawmakers return after the Easter holiday, paving the way for final debate and voting some time at the end of May or June.

A spat between Maia and Bolsonaro last month blew up into a public war of words, which threw the pension reform process into doubt and roiled financial markets. Maia said on Thursday that the responsibility for steering social security reform through Congress is shared between the government and lawmakers.

Maia said that a majority of lawmakers recognize the need for reform but admitted that sentiment is not shared across the country.

A majority of Brazilians are against it, Maia noted, contradicting Economy Minister Paulo Guedes who said at the same conference on Wednesday that the majority of Brazilians supported it. A poll in Brazil this week said 51 percent of the population opposed the government’s proposal.

Reporting by Jamie McGeever; Editing by Cynthia Osterman

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