The Lula administration is grappling with a political and institutional crisis sparked by the urgent proposal of an amnesty bill for the 8 January coup participants, which revealed fractures within the ruling coalition. In response, Congress is considering an alternative bill that reduces sentences for minor offenders but excludes key figures like Bolsonaro. The government is also moving to block the original amnesty bill by leveraging procedural rules and engaging in political negotiations. Simultaneously, budget projections indicate a looming fiscal crisis in 2027, with discretionary spending severely limited due to court order payments and the fiscal cap, jeopardizing constitutional investments in health and education. Furthermore, agrarian reform efforts are at risk following a provisional measure that stripped INCRA of essential duties, causing operational paralysis and legal uncertainty. Amid these pressures, Lula is working to rebuild ties with Congress through strategic meetings and institutional realignments.
Political Crisis and Amnesty Bill
Surprised by the presentation of the urgent request for the amnesty bill for those involved in 8 January, the government is reviewing the map of appointments of allies of the Planalto Palace in search of more support in Congress. The opposition movement indicated weaknesses in Lula’s (PT) parliamentary base and highlighted, once again, the crisis that the government coalition is going through. Deputies from PSD, MDB, União Brasil, PP and Republicanos ended up ensuring the initiative’s progress by delivering more than half of the 262 signatures, despite a quarter of Lula’s ministries being under the command of these parties.
Government Offensive Against Urgency
After the defeat in the Chamber of Deputies, with the officialization of the request for urgency for the vote on amnesty for the 8 January coup plotters, the government designed a strategy to try to turn the tables and bury the project. The idea is to take advantage of loopholes in the House’s rules that give the president, Hugo Motta (Republicanos-PB), room to deny the request. In the coming days, Gleisi Hoffmann’s advisors at the Secretariat of Institutional Relations will make a concerted effort to convince the deputies who have already signed the request for urgency to sign a new document to withdraw the request.
Alternative to Amnesty
In light of this scenario, the Speaker of the Chamber of Deputies, Hugo Motta (Republicanos), welcomed an alternative proposal to amnesty. The new bill, which is being analyzed by Congress and the Supreme Court, aims to amend the current Coup d’Etat Law. It provides for a reduction in sentences from 1/6 to 1/3 for defendants with minor participation in the coup. The measure, however, would not benefit Jair Bolsonaro, former ministers, or high-ranking military officers accused of leading the coup attempt. The bill would improve the current coup d’état law, which does not allow for the differentiation of financiers, organizers, and leaders from other defendants with less participation in the coup acts.
Rapprochement with Congress
Seeking to strengthen his political articulation, President Lula intends to meet next week with the Speaker of the Chamber of Deputies, Hugo Motta, and party leaders. The meeting will be similar to the one held with the President of the Senate, Davi Alcolumbre, on 2 April. Since Alexandre Padilha was replaced by Gleisi Hoffmann at the Secretariat of Institutional Relations, the Planalto has signaled a desire to strengthen relations with Congress.
Fiscal Risk and Budgetary Collapse
Projections from the federal government indicate a growing risk of budgetary collapse starting in 2027. The inclusion of court orders in the spending cap compromises the margin for discretionary (non-mandatory) expenses, which still need to be divided with parliamentary amendments. According to the Budget Guidelines Bill (PLDO) presented on Tuesday (15/04), the space for funding and investments will shrink by R$86.1 billion that year.
Education and Health at Risk
Also, according to the PLDO, the 2027 budget will not be able to guarantee the constitutional minimums for health and education. R$122.2 billion in discretionary expenses are planned, of which R$56.5 billion are already committed to amendments. This leaves R$65.7 billion — R$10.9 billion less than what is needed to meet the minimum investments in both areas.
Agrarian Reform in Check
A gap left by the Lula (PT) government in changes made to executive careers puts agrarian reform work in Brazil at risk. The provisional measure published on the last day of 2024 to restructure the organizational chart of a series of federal civil service positions. In practice, it created a vacuum within the National Institute of Colonization and Agrarian Reform (Incra) and an overlap in its functions. The measure revokes the powers of inspection, evaluation and expert assessment of rural properties and technical pronouncements, preparatory stages for the allocation of land and which serve to assess compliance or non-compliance with the social function of property. According to them, the set of changes depletes the agency and creates legal uncertainty, by downgrading powers to regulation, separating functions and creating a dispute between careers for the same activities.
Analysis:
The current political scenario presents a serious challenge to President Lula’s administration. The urgent request to vote on the amnesty bill for participants in the 8 January coup attempt revealed fractures in the government’s support base and exposed the pressures the Brazilian government is suffering. The fact that parties holding key ministries backed the initiative makes it clear that government appointments do not ensure political alignment.
In reaction, the government is working to block the bill by using procedural tools in the Chamber of Deputies and mobilizing allies to withdraw their signatures from the urgency request. Meanwhile, an alternative proposal to the amnesty bill has emerged as a politically strategic response to the growing backlash against full amnesty for 8 January coup participants. Supported by Speaker of the Chamber Hugo Motta (Republicanos), the bill seeks to amend the Coup d’État Law by distinguishing between different levels of involvement — a nuance the current legislation lacks. This distinction serves two purposes. First, it offers a more palatable legal and political solution that avoids the perception of impunity, which full amnesty would provoke. Second, it allows Congress to reclaim part of the political initiative, distancing itself from both extremes.
Amid this political turbulence, the government also faces looming fiscal constraints. Projections for 2027 show that the current fiscal framework will not allow for essential investments in health and education. Additionally, changes to federal careers have weakened INCRA and jeopardized agrarian reform efforts. Together, these issues reflect a broader risk of institutional and budgetary paralysis.
Sources: O Globo [1], [2], [3], [4]; Folha de SP [1], [2]; G1.
