Congress opens spending spigot, just in time for the election

Almost midway through the year, Congress overrode four of President Luiz Inácio Lula da Silva's vetoes to the 2026 budget guidelines law, restoring rules that ease federal transfers to municipalities and loosen restrictions on government handouts during election season. The session, convened by Senate President Davi Alcolumbre, came less than five months before Brazilians head to the polls.

The most contested provision lets the government distribute goods and benefits in 2026, overriding an electoral rule that normally bans such largesse in the three months before a vote. It was the only override the executive branch openly fought against. Other restored measures let smaller municipalities in arrears with Brasília once again tap congressional budgetary grants — the earmarks lawmakers use to fund projects of their choosing.

Thursday's moves are just the latest in a crescendo of the legislative branch's capture of the federal budget. Since 2013, Congress has steadily seized control of the federal purse, a process that accelerated under Jair Bolsonaro (2019-22), who governed without a stable coalition and under the looming threat of impeachment for the first half of his term.