Almost two months after the first coronavirus case was confirmed in the country, it can be said that Brazil is now facing one of the greatest calamities in its modern history, with profound social and economic repercussions.
The covid-19 pandemic requires a tremendous joint effort by society and the federative entities, notably through measures restricting people’s movement and social distancing, in order to prevent the spread of the virus and, consequently, the collapse of the Brazilian public health system. This requires the implementation of public policies to combat the pandemic, which must be carried out almost immediately, at the risk of compromising their effectiveness, given the rapid spread of the disease and its high level of contagion.
The challenge facing public managers at this time of calamity is enormous: unprecedented construction of field hospitals in record time, supply of hospital supplies and protective equipment, testing, hiring of professionals, and the provision of all the other related public services needed to combat covid-19.
The exceptional nature of the situation, combined with the high level of contagion and spread of the virus, however, does not allow — or, at the very least, makes it difficult — for public managers to hold regular tenders in compliance with the procedures established in Federal Law 8,666/93 and other legislation on the matter.
In most cases, the Executive Branch decree establishing the state of public calamity itself authorizes the emergency contracting of the works and services needed to combat covid-19, in line with the waiver of tender expressly provided for in art. 24, item IV of Federal Law 8,666/93.
Regarding public spending in times of pandemic, the big question is how contracts will be overseen and analyzed and, even more, what stance external oversight bodies will take, given the exceptional nature of the state of public calamity and, once again, the urgency of implementing public health policies and the provision of services by the Government.
For example, at its Plenary Session of 04/08/2020, the Federal Court of Accounts (TCU) approved the “Plan for Monitoring Actions to Combat Covid-19”, which sets out how the Court of Accounts will operate during the coronavirus pandemic, encouraging preventive control of administrative acts involving the expenditure of public funds.
This action plan focuses on monitoring the actions taken by federative entities and analyzing the impacts caused by the pandemic, so that the Federal Court of Accounts has not yet defined price benchmarks or any other parameter or criterion for analyzing the compliance of emergency contracts entered into during the period.
In this scenario, external oversight bodies, sensitive to the exceptional situation of a global pandemic and public calamity, are expected to consider the circumstances in which emergency contracts were entered into and the difficulties imposed on public managers, under §1 of art. 22 of Decree-Law No. 4,657/42 (“Law of Introduction to the Norms of Brazilian Law – LINDB”).
This provision was introduced by Law 13,655/18, known as the New Law of Introduction to the Norms of Brazilian Law – LINDB, which added 11 new provisions to Decree-Law No. 4,465/42, with the aim of improving the creation and application of public law rules, consolidating the State’s pursuit of greater legal certainty and efficiency in carrying out decisions in the provision of services, in support of efficient external oversight of management.
It can thus be seen that current legislation requires decision-makers to apply the principles of reasonableness and proportionality when giving reasons for their decisions, considering the obstacles and difficulties faced by administrators and the demands of the public policies in their charge, without prejudice to the rights of individuals, thereby avoiding orders to comply with decisions that are unfeasible for the public administration or that harm the provision of public services itself.
And it is precisely in this context that the control and oversight of post-pandemic public spending should be exercised: taking into account the exceptional circumstances in which the contracts were entered into, adjusting, for example, contract price benchmarks, and assessing the difficulty and costs of transporting and manufacturing the inputs needed to perform the emergency contracts entered into by the government.
Under the provisions of the LINDB, therefore, it would not be reasonable for external oversight bodies, once the pandemic is over, to indiscriminately invalidate emergency contracts and impose sanctions on contracting parties according to the parameters used in normal situations, failing to carry out a concrete analysis of the national situation, especially with regard to the costs involved in public management, timing and the effectiveness of public policies.
It is a time for joint and targeted action, for the implementation of health policies by the federative entities, for more flexible contracting and performance of administrative agreements, and for the application of the principles of proportionality and reasonableness in analyzing public spending, seeking above all to ensure the effectiveness of measures to combat covid-19.
Article originally published in Estadão, in the column of Fausto Macedo (in Portuguese), on 04.26.2020.
