The revision of military pensions is expected to be part of the cost-cutting package proposed by the Ministry of Planning and Budget, said Simone Tebet, the minister of the ministry, in an interview with the newspaper “O Globo” published on Friday (14). This statement came after a meeting with the Minister of Finance, Fernando Haddad, to discuss the same subject: reducing federal government costs.
In the interview, Tebet mentioned that all expenses will be reviewed. She stated that a “menu” of measures will be presented to President Luiz Inácio Lula da Silva, and that everything will be put on the table when discussing the possibility of revising military pensions. The Minister did not, however, provide information on when the proposal to cut expenses will be submitted, nor did she detail what the project would entail or what changes would be made to the current pension system.
The warning from the TCU mentioned by Tebet is a report from Minister Vital do Rêgo Filho sent to the National Congress last Wednesday (12). The report indicates that the General Social Security System (RGPS), the Specific Social Security System (RPPS) for federal public servants (including those from the former Territories of Amapá and Roraima), the Social Protection System for Military of the Armed Forces (SPSMFA), and the pension system collectively showed a deficit of R$ 428.3 billion in 2023, resulting from the difference between R$ 638 billion in revenues collected and R$ 1.066 trillion in expenses incurred.
The TCU report also points out that none of the country’s pension systems have been able to provide coverage for their respective benefits. The SPSMFA system leads in this aspect, with a revenue-to-expense ratio of only 15.5% in 2023, resulting in a deficit of R$ 49.7 billion, despite the contribution adjustments defined by Law 13,954/2019.
The mentioned Law changed the military pension system, restructuring careers, increasing the service time for retirement from 30 to 35 years (without a minimum age), adjusting the contribution rate, and making it mandatory for those who were previously exempt from payment to contribute.
Is it possible to revise military pensions? Yes, it is possible. However, for changes to be made, a legislative proposal would be required to undergo discussions and prior approvals in the National Congress, as explained by Mozar Carvalho, founder of Mozar Carvalho Advocacy. The process would follow the regular procedures like any other Bill in the Brazilian parliament.
The impacts of a revision would depend on the specifics of the changes, but in theory, it could provide relief to public coffers by reducing expenses on pensions. However, it would be challenging to get the project approved due to the current political landscape and the need for a majority in the National Congress.
The military pension system, unlike the general Social Security system, is managed directly by the Ministry of Defense and the Armed Forces themselves, through their respective commands: Army, Navy, and Air Force. This system is different from a regular retirement because military personnel go into reserve status at the end of their careers and can be called back if needed.