Everything indicates that the proposed privatization of the Post Office has everything to end up shelved. This is because, even though it was approved in the Chamber of Deputies, on August 5th of this year, the proposal faces a lot of resistance from the Federal Senate.
The report was read at the plenary session of the Economic Affairs Committee (CAE) on November 9th and has been stalled ever since. The trend is that even in 2022 privatization will not happen. The government decided to give priority to other projects.
What this article covers:
Postal privatization vetoed in 2022: understand behind the scenes
The government’s projection is that there will be no time to vote on the PL in 2022. Normally, members of Congress prefer not to dedicate themselves to controversial issues in an election year. For the rapporteur of the project in the Senate, Senator Márcio Bittar (PSL-AC), the difficulty in processing it is due, among other things, to “politicism”.
In an interview with the Metrópoles portal, he said that it is normal for there to be disagreements about the understanding of the process of privatization of state-owned companies, and that this is due to party issues and also to the particular convictions of each one. But he emphasized that approval of the proposal is essential for Brazil’s economic recovery after the pandemic.
In this scenario of behind-the-scenes resistance, the government decided to focus on other projects, such as voting, in the same house, on the Precatorios PEC, which should serve as the basis for the Auxílio Brasil program.
Cost benefit of Correios: even making a profit, is it worth privatizing or not
Answering this question involves political positions and the economic conception of each one. So what we can do to understand this issue more objectively is to look at the numbers.
Over the last 20 years, Correios has profited around 20 billion reais and 73% of this amount was passed on to the Federal government🇧🇷 In the time frame that goes from 2001 to 2020, the company recorded a profit in 16 years and a loss in four. It accumulates a positive result of 12.4 billion reais in net values.
Another important information is that the company does not depend on the Treasury, that is, it does not need to be assisted frequently with public money, since, with its own profits, it is able to support itself.
What do experts say about the privatization of the Post Office?
There are divergences among specialists on whether privatization is worthwhile or not. Some claim that, despite the profits, the main objective of the government has to be to invest in crucial areas for social development and not just to profit. In addition, there are those who say that the privatization of the company will bring improvements in the service provided.
On the other hand, there are also those who are against the idea of selling the Post Office on the grounds that selling profitable companies is nothing more than making cash, that is, raising money (which only interests those in power). Furthermore, there is no evidence that this will reduce the public debt and that it will generate good results in the future.
What is certain is that the proposal is at a standstill and has everything to avoid being activated in 2022. Due to the presidential election, next year will be very important for the project to go through or not, because, depending on who wins, the proposal will follow its course or not. it is simply shelved.