Banca de DEFESA: AVÍVIA CAIRO DE MENESES SOUSA

IS IT APPROPRIATE TO TREAT UNEQUALS UNDER THE SAME PARAMETER? A study on the limit on personnel expenses set by the fiscal responsibility law (LRF) and its main consequences on the efficiency of public management in Brazilian municipalities.

Limit with Personnel Expenditure; Fiscal Responsibility Law; Efficiency in Public Management

Amidst the traces of the 1990s Fiscal Crisis, which resulted in a considerable budgetary-financial imbalance and triggered several political scandals, the Fiscal Responsibility Law was enacted in 2000, with the promise of being the "Saviour of the Nation". Its intention was to bring more control, transparency, and planning to Public Management. Nevertheless, after more than 20 years, the rigidity of some requirements has been questioned due to the potential to hinder the investment of funds to meet society's needs. This work focuses on the problems caused by the Article 19 of the Law, which establishes a threshold for personnel expenses - 54% of the Net Current Revenue for each and any municipality, without taking into consideration the dissimilarities that may exist among them. With the aim of showing how the imposition of a limit with personnel expenditure in a generalized way may affect the efficiency of municipal public management, considering the existing antagonistic socioeconomic situations, the 130 municipalities with the highest Net Current Revenues (NCRs) and the 130 with the lowest NCRs in the year 2019 were selected. As a theoretical apparatus, this quantitative, bibliographical, documental, and analytical research was guided by references that bring to light the nuances of the Fiscal Responsibility Law, efficiency, and the use of indicators in Public Management and the specific local Scenarios from the perspective of Milton Santos, a geographer from national and international prominence. To analyse the results, the following data has been collected from 260 municipalities in the sample, namely: Net Current Revenue, Personnel Expenditure, Population, Mortality from avoidable causes, Age-Serial Distortion, Socioeconomic Level, and Annual Social Information Report. Afterwards, through the non-parametric statistical model of Data Envelopment Analysis (DEA), the variable "efficiency" was found. The outcomes suggest that the legal limit on personnel expenditures impacts negatively both on the management of smaller and larger municipalities, because in some of them it prevents investment in substantial areas, while in others it stimulates spending increases.