The payroll credit available to Auxílio Brasil families became a cause for concern for Lula's team. During the campaign, the PT and its allies criticized the release of loans for vulnerable families, arguing that the measure would further harm families already in debt.

According to the Ministry of Citizenship, 1 in every 6 beneficiaries took out payroll loans released by Caixa Econômica Federal and 15 other financial institutions.

However, the majority – R$ 7.65 billion – was requested from the public bank, while another R$ 1.8 billion was granted by financial institutions and private banks. The big banks were left out of the loan offer.

“Around R$ 9.5 billion had been disbursed by 1 November, most of it during the election period. These people will have up to 40% of the committed benefit […]. The clearly electoral measure goes against social protection policies and puts future benefits at risk“, said a survey carried out by the Social Development technical group in the transition team.

Based on this, the solution studied by Lula's team is to suspend financing and change the legal framework to avoid over-indebtedness for families living on a monthly income of up to R$ 210. The vast majority of beneficiaries used consigned credit to buy food, pay debts and cover end-of-year expenses.

It is important to remember that, when contracting the Auxílio Brasil loan, the family will have deducted up to 40% from the monthly benefit (R$ 160) until the end of the contract. However, if the family loses the right to the benefit, the debt will remain open and must be paid off anyway.

“People who take out payroll-deductible credit will have their family income compromised, who remain in the income transfer program, who do not, even if they leave due to redesign, investigation or impossibility of updating the information“, informs the document.

According to the newspaper O Estado de S. Paulo, the government is analyzing the debt amnesty measure for Auxílio Brasil families who took out payroll loans in 2022. The information was confirmed by Wellington Dias, Minister of Social Development, who confirmed the discussion about a broader program for debt renegotiation.

“There is a proposal for amnesty for those in debt. It is not possible to say [the details of the program] yet because there are legal aspects that affect a bank“, explained Dias. Discussions on the topic are ongoing and include Caixa Econômica Federal, the Comptroller General of the Union (CGU), the Attorney General of the Union (AGU) and the Ministry of Finance, in addition to the Secretariat of Social Development.

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