For OAB, that PEC “ultimately establishes the largest government’s swindle ever seen in this country”

On Wednesday (3), the vice-president of the Federal Council of the Brazilian Bar Association (OAB), Wladimir Rossi Lourenço, condemned the so-called PEC on Precatorios (PEC 351/09), which had already been approved by the Senate. A “precatorio” is a special judicial payment order originated from civil claims against federal, state or municipal public government agencies with final judgment no longer subject to any appeal by the public entities. This Bill of Constitutional Amendment (PEC) provides for bids among creditors, to lower those government’s debts, already recognized in court lawsuits.

The bill also changes the order of payments, which would no longer be chronological, but ranked according to their amounts. Calculations from OAB forecast that, if those bill’s rules prevail, creditors would have to wait, in some cases, for more than 150 years to receive their payments.

"That PEC ultimately establishes the largest government’s swindle ever seen in this country; once approved, many people who are waiting for their credits, which were recognized in court decisions, will probably never receive them, and maybe not even their future generations either”, affirmed Lourenço, after a public hearing held at the Committee on the Constitution and Justice and Citizenship (CCJ), to discuss that bill.

Offense to dignity
For the vice-president of OAB, that is an offense to the dignity of the citizens, obliging them to choose between an “endless line” and a bid, in which the more they give up on, the higher will be their chance to receive something.

And that will happen after they have gone through “years of Calvary”, along the process of recognition (in which it is discussed which part is right), and obtained a favorable decision. “The decision of Judiciary Power is effectively being violated”, he adverted.

Lourenço affirmed that the Bar will struggle to change that PEC at the Chamber, but said that that institution can appeal to a direct unconstitutionality lawsuit, against the possible amendment, if the current text is maintained. “If that PEC is approved, the subject will be taken to the Federal Council of OAB, which will decide what to do next.

Judges’ standpoint
The president of the Association of Brazilian Magistrates, Mozart Valadares, expressed the position of judges in the hearing. “We cannot accept that the creditors are penalized by that constitutional amendment”, he affirmed.

Deputy Luiz Carlos Hauly (PSDB-PR) considers that it would be counterproductive to approve a PEC limiting the power of Judiciary in the enforcement of its decisions. “The very judges who issued the decisions [which caused the government’s debts] will go against that amendment”, he forecast. Therefore, he called the deputies for the construction of a consensus on a “broad accounts’ conciliation”, involving creditors and debtors.

CNI also criticizes amendment
The National Industry Confederation (CNI) also criticized that bill. “I will avoid the word immoral, but I can say that that bid violates the principle of administrative morality”, affirmed the lawyer of that body, Cássio Borges. He advised the deputies to keep their common sense. “The constituents cannot ratify that ‘bid of the desperate’”, he said.

According to him, CNI fears that that PEC configures seizure against creditors. “CNI expresses its total disagreement with that bill. It is totally disproportional. It promotes the exclusive benefit of the government, and causes a disproportional loss to creditors”, he affirmed.

Municipalists defend it
The legal assistant of the National Confederation of Municipalities (CNM), Elena Garrido, admitted that the municipalities are in default, but not willingly.

“The highest truth is that the government’s treasures cannot afford to pay those obligations”, she affirmed. According to her, the municipalities’ budget is “extremely inflexible”, because of the constitutional links approved by the Chamber.

According to her, another problem is the rule obliging the payment of these judicial payment orders in chronological order, which eventually generates jams. “Some municipalities have not paid their debts for five, six years, because the line is locked by a debt which is larger than their budget”, she revealed.

For Deputy Luiz Carlos Hauly, the representation body of the municipalities is partially right. “We attach revenue like Scandinavian countries, buy our expenses are typical to the third world”, he affirmed. According to that deputy, the huge expenses with the maintenance of the government’s machine are currently a “trap” to the fiscal balance of the municipalities and of the states.

Debt updating
According to Paulo Maluf (PP-SP), the problem of the judicial payment orders is caused by the debt-updating systems. For him, there are only two options. “Either a solution is found, or that problem is postponed to one’s successors”, he said.

For the Secretary of finances of the municipality of São Paulo, Walter Aluísio Morais Rodrigues, that PEC will “enable the operation of municipalities”. He stressed that that bill ensures the preferential payment to smaller and older creditors. “The seizures [forced withdrawals of resources from the accounts of government bodies which do not comply with the court orders to pay judicial payment orders] mean the discontinuity in public services’ providing”, he added.

Amendment possibilities
The rapporteur on the bill at CCJ, Deputy Eduardo Cunha (PMDB-RJ), who suggested the hearing, indicated that that bill will be amended to be approved at the Chamber. “The municipalities have problems, the states, too. We cannot disregard that reality. The text, though, needs some repairs. If they are not made in here (CCJ), they will be made in the Special Committee. Three fifths of the votes are a very difficult quorum to reach, if we do not get to a consensus”, he affirmed.

The mayor of São Paulo, Gilberto Kassab, one of the main defenders of that PEC, took part in the meeting. He commands a municipality which owes R$11 billion in unbacked securities, but did not get discouraged by the deputies’ resistance.

"Our proposal reflects what was approved by the Senate. I understand that, because of what people manifested here, the bill will be enhanced. It will then return to Senate, so that that House takes a definitive position”, he said.

Report - Edvaldo Fernandes
Editing - Newton Araújo
Translation - Positive Idiomas Ltda