December 7, 2017 / 11:17 PM / a year ago

Temer, congressional leaders delay Brazil pension vote

FILE PHOTO: Brazil's President Michel Temer attends a ceremony at Planalto Palace in Brasilia, Brazil, December 6, 2017. REUTERS/Adriano Machado

BRASILIA (Reuters) - Brazil’s President Michel Temer has agreed with congressional leaders to delay a key vote on pension legislation in the lower house until the week of Dec. 18, the speaker of the body, Rodrigo Maia, said on Thursday.

The pension overhaul, a cornerstone of Temer’s efforts to reduce Brazil’s budget deficit, is seen by investors as crucial to boosting the nation’s fiscal health.

Brazil’s currency and benchmark Bovespa stock index slipped on Thursday amid concerns that Temer lacked support to put the measure to a vote.

If a vote were further delayed to next year, it could infringe on campaigning for elections due in 2018, a move most investors see as reducing the likelihood that the unpopular measure would be approved.

The bill seeks to increase the age at which Brazilians can retire and collect social security. It would also make pension payouts in Brazil - some of the most generous in the world - more modest.

Temer has held a flurry of meetings in recent weeks with the heads of allied parties to whip the votes he will need to win the bill’s passage and send it to the Senate. Among the carrots he has offered is increasing the size of the budget each legislator is given to spend on social projects in their districts.

Congressional leaders have said in recent days that the coalition supporting the bill is more organized than in weeks past. However, the government has not yet been able to secure the 308 votes the measure will need for passage.

Reporting by Ricardo Brito; Writing by Gram Slattery; Editing by Susan Thomas and Rosalba O'Brien

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