Brazilian Minister of Finance, Antonio Palocci, held a press conference over the weekend to explain that a controversial contract for garbage collection was made before he became mayor of Ribeirão Preto.
Palocci has been accused by a former aide of receiving payments from the Leão & Leão company, which had a contract to collect garbage in Ribeirão Preto, a city in the state of São Paulo where Palocci was mayor (2000-2002).
Palocci explained that according to the accusation, companies that won city contracts paid kickbacks to local authorities.
“I think it is very relevant to note that the money, according to the accusation, was paid by companies when they won contracts. Well, these contracts were signed before I became mayor,” said the minister.
Palocci said he was not criticizing former governments. “All I am saying is that I did not sign the contracts.”
However, Palocci did admit a no-bid contract worth US$ 57,140 (140,000 reais) while he was mayor.
“We had heavy rains in the city and had to clear streets of fallen trees. We just did not have time to go through a competitive bidding process. It was an emergency,” he explained.
Palocci, strongly denied charges made by a former aide, Rogério Buratti, that he received US$ 21,000 (50,000 reais) in monthly payments from a company contracted to collect garbage when he (Palocci) was mayor of Ribeirão Preto. According to Buratti, Palocci passed the money on to the PT.
“I categorically and vehemently deny these charges. I never received or collected funds for the PT while I was mayor or at any other time,” declared the Minister.
Palocci explained that he had spoken to Brazilian President Luiz Inácio Lula da Silva about the matter, and the President had decided that he was to remain at his post.
“President Lula has decided that the accusations by Buratti will not affect my position and I will continue to be Minister of Finance,” said Palocci.
During the press conference on Sunday, Palocci, was asked if corruption charges made by a former aide could have a negative impact on Brazil’s economy. The Minister answered that today’s economic agents know the difference between political and economic processes.
“It was not always that way. In the past, a political crisis could quickly cause problems in the economic area. But not today because of two reasons. First, our fundamental economic situation is very solid. We have a strong position in foreign trade. In second place, we have a sound democracy in Brazil,” declared the minister.