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Collor Strives to Trim Federal Fat

BRAZIL GOVERNMENT REFORM

By Julia MichaelsSpecial to The Christian Science Monitor / June 18, 1990



BRAS'ILIA, BRAZIL

PRESIDENT Fernando Collor de Mello has promised to turn the Brazilian government deficit into a surplus this year, by cutting an estimated $5.5 billion of the $13 billion federal budget. Removing bureaucratic fat is meant to make a big contribution to stop wasteful spending and lower inflation.

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President Collor has given administrative reform secretary Joao Santana mission that includes rebuilding government, retraining personnel, and selling off federally-owned cars and housing.

It is a mission that has been taken on by several previous presidents. But politicians and bureaucrats have always proven stronger than the president's will. And the old-time power game of jobs, votes, and fiefdoms, has continued.

This time, Mr. Collor, Brazil's first directly elected president in 29 years, has the will and popular mandate to change, to overcome entrenched interests. But in this attempt, analysts say, there is much more at stake.

``If [Collor] can create an efficient government in terms of service, he will be consolidating democracy. If not, society will end up associating the idea of democracy with inefficiency, and turn to nostalgia for authoritarian government,'' says Joao Geraldo Piquet Carneiro, a political risk consultant who worked on a previous cost-cutting program.

Trying to locate Brazil's chief government cost-cutter is like following the tracks of a manchete-wielding jungle traveler.

The address of Secretary Santana is ``C block,'' a building on the well-known Esplanade of Ministries. But it is hard to pinpoint, since the locals know the building as the Ministry of Culture, recently put out of business as part of large cutbacks.

Once inside C block, there is the business of a visitor ID. The acronym on it - Seplan - comes from another defunct department, the Planning Secretariat, folded into Economy Ministry.

Yet another vestige of the bureaucratic past is barely visible over Secretary Santana's doorway: the mark on the wood of letters that once spelled out ``Minister's Office.''

Mr. Santana says that he does indeed feel as if he is working in some kind of jungle. ``It's hard to reallocate employees when you don't know where they are or how many there are,'' he says.

Today Santana is expected to complete the first stage of his mission by publishing a list of public servants who will be laid off or offered more productive jobs. In May, the government announced it would slash the federal work force of 1.6 million people, by 20 to 25 percent. But many analysts doubt whether today's list will really total this much, because the Constitution protects so many federal workers' jobs.

While facing such obstacles, Santana must also deal with government-owned apartments that can't be sold because the architect forgot to draw a bathroom in the plans, a government company that invested in burial plots, and a port authority that has been set up with a payroll for would-be workers - when reality is that the port is merely a single pier.

``The federal computer systems have so much installed capacity that I would be exaggerating if I said 30 percent of it is in use,'' Santana says. ``One system doesn't communicate with another, and there are repeated data banks. They are part of [bureaucrats'] fiefdoms.'' Worse, systems analysts, not required to document their work, leave those who succeed them in the dark.

The secretary adds that of every federal cruzeiro spent (1.8 US cents), only 30 centavos (one-third of a US cent) provides a service, the rest pays for swollen middle layers of government.

Despite a clear mandate from the 35 million Brazilians who voted for him, Collor has a monumental task. With gubernatorial and congressional elections this October, spending pressure is on.

At the same time, Collor needs friends in Congress and at the state level to get his economic program approved and fully functioning. But politicians fear voters will identify them with sacrifices the program entails. Congress, tractable at first, has begun to balk at measures that may keep voters' wages below inflation.

``It will be hard to get the revised budget approved in Congress,'' says political risk analyst Walder de G`oes. ``So it will be hard to present acceptable [economic] numbers to the International Monetary Fund and private banks.'' Brazil wants to negotiate an IMF standby loan and renegotiate its $115 billion foreign debt with banks, this year.

Analysts and politicians criticize the way the government is going about the administrative reform. They say Collor's desire to show immediate results has obscured the more important task of restructuring government, and that the layoff criteria are not clear. Announcing targets was bad, they add, because it sets the scene for a letdown.

``An administrative reform in a private company takes five to six years, in an environment where a company can do what it wants,'' says Cesar Maia, federal deputy for the opposition Democratic Labor Party. ``In the public sector, where there's greater resistance and the legal obstacles are bigger, you need to be much more consistent.''

Most analysts agree that the government will not meet its ambitious goals to cut back on jobs. ``If they do 100,000 it's a giant step for mankind,'' jokes Joao Cabral, a top administrator at the Education Ministry, who has helped to make up today's list.

Still, he predicts ``considerable improvement in the quality and amount of service provided by the public service because of a new ethic about work and the certainty that if you are not useful, you will be gone.''