Lula Sanctions 2026 Budget, Vetoes R$393 Million and Moves to Freeze R$11 Billion

Overview

• The signed LOA sets federal spending at R$6.54 trillion, with formal parliamentary amendments at R$49.9 billion after Congress sought to expand the practical total to about R$61 billion by reclassifying roughly R$11.4 billion in discretionary funds.
• The government says about R$7.7 billion will be remaneuvered to original social programs such as Pé-de-Meia, Gás do Povo, Farmácia Popular, Mais Médicos and university funding, while roughly R$3.3 billion will remain blocked to comply with the fiscal framework.
• Lula’s partial vetoes cover 24 allocations totaling about R$393–400 million, concentrated in health (around R$382 million) and also affecting irrigation in the Northeast (R$30.4 million) and the Federal University of Delta do Parnaíba (R$7.5 million).
• The Planalto cites compliance with Complementary Law 210/2024 and recent Supreme Court parameters on amendment growth and specificity, and the LOA enables blocking up to roughly R$11–11.5 billion during execution if needed for fiscal targets.
• Opposition and Centrão leaders indicate they will seek to overturn the vetoes, and Senate and Chamber budget consultancies question four vetoes worth R$119.7 million, offering lawmakers technical grounds for a challenge.