On August 15, BBC news reported that Brazil’s Congress had given assent to the law that stipulates for mandatory allocating all means gained as a royalty from oil companies for the education and health care needs.
A royalty means a payment for the oilfield development right. The new regulations of the budget replenishment concern only offshore deposits of hydrocarbons. 75% of such funds are to be channeled into the education advancement, while the rest of the money is to be earmarked for the public health service.
In early July, the law was adopted by the Senate, the Upper Chamber of the Brazilian Parliament. Brazil’s President Dilma Rousseff is to endorse the new regulations by signature in order to make them have legal force. The law is expected to come into operation in 2014. The Brazilian authorities made the public announcement about the social expenditures growth as a backlash against the tide of protests in major cities in the country in early June. Experts estimate that Brazil is able to gain up to 200 billion reals ($86 billion) for developing the education and health service by means of the new fiscal effort of budgeting. The South American state’s budget was worth $1.17 trillion in 2013.
