Justice argues that the fiscal costs of wildfires outweigh the expenses needed to combat them

09/16/2024

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Flávio Dino — Foto: Rosinei Coutinho/SCO/STF

Supreme Court Justice Flávio Dino authorized the federal government to issue extraordinary credits beyond the fiscal target until the end of the year, exclusively to combat wildfires affecting Brazil.

“We cannot deny the maximum and effective aid to over half of our territory, its respective populations, and the entire flora and fauna of the Amazon and Pantanal, based on compliance with an accounting rule not found in the Constitution, but rather in the realm of sub-constitutional laws,” Mr. Dino stated in his decision on Sunday (15).

Additionally, the justice argued that the negative impact on fiscal responsibility would be more attributable to the erosion of productive activities in areas affected by the fires and drought than to the temporary suspension of fiscal rules through the end of 2024.

Mr. Dino also ordered the relaxation of rules for hiring and retaining wildfire brigades, waiving the current law’s three-month waiting period for rehiring staff who have previously provided service.

The ruling emphasizes the need for increased involvement of the Federal Police in investigating the role of human activity in the majority of the fires in the Pantanal and Amazon regions.

Mr. Dino’s decision followed a warning from the legal advisory office of the Ministry of Planning and Budget about the risks that extraordinary credits for combating wildfires—outside the fiscal framework’s spending limit—could pose to the balance of public finances.

The legal advisory’s terms were included in a submission by the Attorney General’s Office (AGU) sent to Mr. Dino to support the decision to release extraordinary credits for the 2024 budget. Last Tuesday, the justice gave the AGU 48 hours to present its position.

“The impact on macroeconomic indicators, such as inflation, interest rates, and public debt, could be significant, especially if these extraordinary expenses are financed by increased public debt. Therefore, caution is recommended in issuing extraordinary credits, along with compensatory measures to mitigate fiscal and macroeconomic risks, ensuring the sustainability of public finances in the medium and long term,” said Richard Marinho Cavalcanti, coordinator of Budgetary Affairs for the Ministry of Planning’s legal advisory office.

Mr. Cavalcanti further explained that these exceptional resources might force the government to make fiscal adjustments to meet the targets set by the fiscal framework.

“Although these credits are exempt from the spending limits of Supplementary Law 200/2023, they still impact the primary result target established in the 2024 Budget Guidelines Act. This requires strict fiscal adjustments from the government to ensure compliance with this target, under penalty of fiscal imbalance and economic deterioration.”

Wildfires in Brasília

A large wildfire broke out on Sunday in Brasília National Park, also known as Água Mineral Park.

Mauro Pires, president of ICMBio (Chico Mendes Institute for Biodiversity Conservation), said the fire shows signs of being intentionally set. He stated that the blaze began near the Granja do Torto region and quickly spread into the park due to hot and dry conditions.

As of Sunday night, no arrests had been made. “The cause of the fire is undoubtedly criminal. It started at the border of Granja do Torto and spread into the park,” Mr. Pires said.

The firefighting efforts include teams from the Federal District Fire Department and ICMBio brigades. The teams remained on site as of Sunday evening. The park is a vital conservation area, protecting rivers that supply the region.

As of Sunday afternoon, Brazil still had 6,251 active wildfire hotspots, according to data from the National Institute for Space Research (INPE). Pará had the most fires, with 1,765 hotspots, followed by Mato Grosso with 1,150 and Tocantins with 637.

In São Paulo, at least 12 cities had active fires on Sunday, according to the state’s Civil Defense. On Saturday, the state government deployed 20 aircraft with 100% of its resources to combat fires in 13 municipalities.

From January through Saturday, Brazil recorded 182,568 fire hotspots, nearly triple the number in Bolivia, which ranked second with 64,091. Venezuela had 39,000, and Argentina followed with 22,130.

(With information from Folhapress)

*Por Marcelo Ribeiro, Caetano Tonet — Brasília

Source: Valor International

https://valorinternational.globo.com/