The Finance Minister, Henrique Meirelles, assessed as positive the approval by the House of Representatives of the project that defines the renegotiation of the debts of the states with the Union. That text also sets a ceiling for the growth of state spending.

According to the minister, who issued a statement on the morning of Wednesday (10) for comment, this is the first step setting. "It is the first concrete step of structural adjustment of Brazilian public spending in decades," he said.

He further argued that governments meet all the conditions to comply with this ceiling. "The governors have all legal instruments to ensure the ceiling of expenditure of States, as required for the framework of each State under renegotiation," he said.

Meirelles also noted that the next project related to the structural fiscal adjustment of public accounts to enter on the agenda is what sets a cap on federal spending.

How the ceiling expenses

This ceiling has now been set for the states and must eventually be approved also for the Union is a limit to such expenses. With it, spending will grow only equivalent to inflation of the previous year - this in practice means real expansion zero expenditure, a freeze.

What provides the agreement between States and Union

The text of the renegotiation of debts was approved during the early hours of Wednesday (10) by 282 votes in favor and 140 against. With this measure, it is expected to generate a relief of R $ 50 billion to state cases by 2018.

With this agreement, the United managed to extend their debts with the federal government in 20 years. To improve the governors box conditions, the agreement provides that they will stay until the end of the year without paying any portion of this debt and only in 2017 these payments will resume, but gradually.

In addition to the debt with the Federal Government, the States have benefits in debts to the National Bank for Economic and Social Development (BNDES), with an agreement providing for the stretch for 10 years, with four-year grace period, five lines of credit in the bank .

Source: Portal Brazil, with information from the Ministry