Brazil’s exiting President Michel Temer signed into law a 16% pay raise for Supreme Court justices on Monday, disregarding a request from his President-elect Jair Bolsonaro that he veto the bill to avoid increasing next year’s budget deficit.
The top court salaries serve as a benchmark for other public sector pay and the hike will add an estimated 4 billion reais (US$ 1 billion) to the deficit that Bolsonaro’s economic team has promised to balance in one year.
Bolsonaro, who will inherit a gaping deficit when he takes office on Jan. 1, said earlier this month that this was “not the moment” to approve public sector pay increases.
Bolsonaro’s economic team, led by University of Chicago-trained economist Paulo Guedes, plans to make a new proposal for overhauling the costly pension system, one of the main causes of the deficit that is driving up the country’s public debt. Temer failed to get pension reform through Congress.
Political sources in Brasilia indicated that allegedly Temer was unable to obtain Bolsonaro's word that he would have been named as the future ambassador in Italy. Temer will be facing several corruption charges when he steps down from office.