The Brazilian National Congress approved the establishment of a public campaign fund on October 4. The fund was inspired by the 2015 ban on corporate donations, a reaction to corruption allegations implicating several sitting politicians. Taxpayer money will now be used to fund campaigns. It will be allocated proportionally based on each party’s representation in Congress. The fund consists of over USD $500 million for the lead-up to the 2018 general elections. After the ban was enacted, overall political contributions dropped by nearly 50 percent in the 2016 municipal elections.
This bill would limit the ability of rich candidates to self-finance their own campaigns. Under the new rules, a candidate can only donate 30 percent of their total expenses to their own campaign. This restriction would have affected two of Brazil’s current prominent governors in Belo Horizonte and São Paulo.
A public outcry accompanied a previous version of the bill, in which the public fund had double the amount that it currently has. Congress reacted by limiting the fund and agreeing to finance it through spending already earmarked for politicians. Supporters of the fund claimed that if a legal public fund was not established, politicians would likely accept money from illicit sources.
Congress recently passed another political reform that terminated electoral coalitions in legislative elections. Starting in 2018, parties must win 1.5 percent of the vote in at least nine of Brazil’s 27 states in order to maintain public funding. Brazil currently has 25 political parties with representation in Congress. Supporters of the reform complain that this high number makes governing coalitions difficult. Under the new rules, Congress hopes to limit the number of political parties to about 15. However, critics of President Temer see the proposal as an attempt to consolidate power in the hands of incumbents.