April 19, 2017

Brazil police storm Congress over proposal to raise retirement age

Pension changes spark violence in Brasilia as police union members clash with congressional security forces

Congressional police in riot gear used tear gas to drive back hundreds of members of federal police unions who tried to invade the Brazilian Congress on Tuesday to protest against a pension reform bill that would reduce their benefits.

The demonstrators broke glass doors before being pushed back in a violent clash that underscored the unpopularity of the pension reform President Michel Temers government is proposing to balance Brazils overdrawn public accounts.

The lower Chamber of Deputies, where debate on the bill will begin at committee level on Wednesday, said in a statement that 500 demonstrators, most of them off-duty police officers, tried to invade the building but were repelled with no injuries reported.

The controversial reform sets a minimum retirement age of 65 in a country where public sector employees work on average to 54 before retiring in a generous social security system that is the main cause of Brazils unsustainable budget deficit.

The police went ahead with their protest despite the announcement of concessions that would dilute the fiscal savings of the bill by at least one fifth by setting lower retirement ages for women, teacher, rural workers and police. The changes reduced the proposed age of retirement for police officers to 60 from 65.

Members of Police force unions protest in Brasilia on Tuesday. Photograph: Jodson Alves/EPA

The 27 federal police unions behind the protest said the bill failed to reward the risk involved in police work.

Some analysts have a dimmer outlook on the watered down proposal. In a note to clients, JP Morgan analysts said the changes could mean savings of just 472bn reals $152bn), down 40% from 781bn originally.

Investor concerns over potential delays to the reform have weighed on demand for Brazilian assets in recent days. The countrys benchmark Bovespa stock index slipped 0.3% on Tuesday, falling for the fourth time in five sessions, and the real reversed early gains.

Adding to setbacks for the government on Tuesday, the lower house voted down an effort to fast-track another change proposed by Temer to modernise labor laws, making work contracts more flexible to improve Brazils business environment. House Speaker Rodrigo Maia said the setback was the result of a parliamentary error, leaving open the possibility of another vote.

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