FINANCIAL CALAMITY AND THE FISCAL RESPONSIBILITY LAW: public need or administrative freedom?

Abstract

The key point of this research work is the management of the public finances of the federation's entities. In order to study the serious situation in which many public entities find themselves, several titles specialized in public planning and finance were searched, as well as reports from official agencies with data related to public management and specialized articles. The basis of this research is the Federal Constitution, the Fiscal Responsibility Law, laws related to public calamity, financial calamity decrees and complementary laws regarding tax recovery. It is concluded that, public debt in Brazil has existed since before the declaration of independence, having been influenced by the internal and external economic scenario throughout history. In order to ensure better management of public finances, the Fiscal Responsibility Law was drafted, which has planning, transparency, control and accountability as its main points. The lack of effectiveness in control and accountability has led many public entities to a dramatic situation of fiscal imbalance, requiring the Union to promote a series of actions with the objective of guaranteeing the fiscal recovery of these public entities. Even though these entities tried to obtain greater freedom of management, trying to exempt themselves from complying with some of the limits imposed by the Fiscal Responsibility Law, alleging the financial calamity, this did not happen, since specific tax recovery laws were drafted that determine the clear definition of actions as well as the need for their monitoring by the Union. Therefore, the Union proposed to help these entities in financial difficulties, temporarily waiving the fulfillment of some requirements of the Fiscal Responsibility Law, however it determined deadlines and imposed conditions to which they must submit in order to benefit from this aid.