Brazil centrist parties vow to back Temer fiscal plan

Brazilian President Michel Temer arrives arrives to attend the G20 Summit in Hangzhou, Zhejiang province, China, September 4, 2016. REUTERS/Rolex dela Pena/Pool

BRASILIA (Reuters) - Centrist parties pledged their support for President Michel Temer’s plan to curb public spending and balance Brazil’s overdrawn government accounts on Thursday, raising the prospect for quick approval of a spending cap amendment he is seeking.

With municipal elections in October, lawmakers are weary of unpopular belt-tightening proposals and want assurances education and health budgets will not be cut. This has raised doubts about Congress’ willingness to back austerity measures ahead of the vote.

In a letter handed to Temer by their leaders, six parties joined by the ruling Brazilian Democratic Movement Party (PMDB), said Brazil urgently needs to restore growth and that can only be achieved with reforms proposed by Temer that include changes to the tax, fiscal and pension systems.

“We reiterate our absolute and unrestricted commitment and support for the action of this government,” the letter said.

The parties represent more than 200 lawmakers in the 512-seat lower house where the spending ceiling amendment, which limits expenditure growth to the rate of inflation, is being debated at committee level.

PMDB Congressman Darcisio Perondi, who is leading efforts to push the cap through, said it will be put to the vote in the committee on Oct. 7 and in the full chamber by the end of the month.

“If there are no storms, we will send it to the Senate in the first week of November,” he told reporters.

Perondi said the government will not accept attempts to ease the spending ceiling cap by linking it to GDP output growth, but he said the duration of the spending limit, currently set at 20 years, could be changed.

Reporting by Anthony Boadle; editing by Diane Craft