BRASÍLIA, Sept. 5 — President Luiz Inácio Lula da Silva went on the offensive Thursday over Brazil’s fiscal deficit, rejecting what he cast as a political effort to pin the blame on social security spending and pointing instead at the country’s towering interest bill. Speaking one month before Brazil’s presidential election, Lula said the real driver of the shortfall is the roughly R$1.3 trillion (about US$240 billion) the government pays in interest each year. “I have never accepted putting the responsibility for the deficit on social security,” he said.
“I never have and I never will.” The remarks land in a politically charged window. Brazil’s public debt is weighing on the fiscal outlook, and the government has been eager to show progress on a promise Lula made during his 2022 campaign to clear the benefits backlog.
Backlog Declared ‘Eliminated’
Officials announced that pending applications for pension and social-assistance benefits at the INSS, Brazil’s social security agency, fell to 1.252 million at the end of August — the lowest level since Lula returned to office in 2023 and below the monthly volume of new applications. The government declared the backlog “eliminated.” That marks a sharp turnaround from February, when pending applications hit a record 3.128 million and raised internal concerns that long waits could dent Lula’s popularity.
Social Security Minister Wolney Queiroz framed the milestone in procedural terms: “Eliminating the backlog means having fewer people waiting than the number of new applications coming in.” He added that “what used to be a backlog becomes a normal flow of applications, and that happened in August this year.”
Defending Benefits, Challenging Critics
Lula used the event to push back against criticism of social programs that have become targets in the election campaign. He defended minimum wage increases above inflation — which lift most social security payments — as well as the BPC, a means-tested benefit for low-income elderly people and people with disabilities. “What does giving a 3% real increase to the lowest wage in the country amount to?” he asked, questioning the scrutiny directed at the policy.
Under current rules, the minimum wage can rise by up to 2.5% a year above inflation. On the BPC, Lula insisted the program has eligibility criteria and that the state’s job is to apply them.
“The blame always falls on the poorest,” he said. “Now the problem is supposedly this benefit, the Bolsa Família cash-transfer program and social security.” He did concede that “there are also plenty of scammers trying to find a way to get money.” The political calculus is delicate. Lula is defending the programs that anchor his base while the fiscal cost of those policies remains a live issue in the campaign.
How voters weigh the backlog victory against the broader debt picture may shape the race’s final month.
