Brazilian Government to Get More Involved in Big Construction Projects

Jirau hydroelectric in Brazil The new Brazilian president Dilma Rousseff has decided that in the case of large construction projects, especially infrastructure and hydroelectric sites in isolated regions of the country, there should be a greater presence of the government.

According to Paulo Maldos, the national secretary for Social Liaison, which is housed in the office of Gilberto Carvalho, the presidential aide who deals with social movements (Secretaria-Geral da Presidência da República), Brasília will demand that contractors move more quickly and efficiently in completing mandatory preparatory procedures at large construction sites.

These required preparations involve initiatives in the areas of safety and housing for workers, ecosystem protection, minimum disruption of the lives of local inhabitants (especially indigenous populations), environmentally-friendly action to preserve fauna and flora and, in the case of Belo Monte, guarantees that the river will remain navigable.

“We were in the Volta Grande do Xingu region [where the Belo Monte hydroelectric project is located) and discovered that the required procedures were way behind schedule. We came to the conclusion that what was missing was the State. Faced with this problem, the government will ensure that the State is present. What we are not going to do is let contractors represent the government (State) at these isolated construction sites in remote regions of the country,” declared Maldos.

Payable Accounts

Brazil’s Ministry of Finance has announced that the government will cancel payable accounts from 2007 to 2009 totaling some 10 billion reais (US$ 6.13 billion).

So-called payable accounts (“restos a pagar”) refer to money allocated in the budget for one year but to be spent in the next year, if certain conditions are met – basically: if the service is underway or has actually been concluded.

A number of senators in both the government coalition and the opposition raised their voices in anger at the news of the decree canceling the payments. The president of the PMDB, Valdir Raupp, the biggest of the government’s allied political parties, told Agência Brasil that most of the service orders were not completed because local, municipal authorities were simply unable to make their way through the red tape.

“Executive branch red tape is an inferno,” declared Raupp. “The Federal Loan and Savings Bank (Caixa), for example, has created problems that make it impossible to begin many projects. There is so much red tape and oversight that work projects all over the country at a standstill.”

According to Raupp, in some places tender offers have not been made because of red tape, in other places tender offers have been submitted but not approved because of red tape and in some places the work has been approved but machinery bought by local governments lies idle when the government does not release money – because of red tape.

Raupp and other senators are concerned because the payable accounts that the government decree canceled include many congressional earmarks (“emendas parlamentares”). Raupp admits that there are various causes for the problems, calling the situation a “mix of errors.”

At the local level authorities do not know how to deal efficiently with drawing up projects and submitting them to competitive bidding, he reports. Finally, says Raupp, there is the red tape the government itself creates.

Senator José Agripino Maia (Rio Grande do Norte), the president of the DEM, an opposition party, called the decree “an official default.” He complained that the administration had created great expectations in cities and states with the possibility of a vast number of public works that were now being canceled.

“And the government transfers the political burden of explaining this to the population from itself to members of Congress and local politicians,” said Agripino.

Another opposition politician, Álvaro Dias (Paraná), leader of the PSDB, said the decision to cancel payable accounts demonstrated administrative disorganization and a lack of planning.

But Humberto Costa, leader of the government party, the PT, said that in reality the decree guaranteed that work underway would continue and that local officials would receive funding for work projects that begin before June 30. He called the decree “a fantastic three-pointer” (“gol de placa”) as it will not mean any interruption in public work projects, but rather continuity.

ABr

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