Two stories emerged from Brazil's fiscal system on Thursday, and together they tell a single damning story: while Supreme Federal Tribunal Justice Flávio Dino issued an injunction blocking any new legislation that allows payments above the constitutional spending ceiling, a parallel investigation published by Folha de S.Paulo revealed that public servants have already been collecting salaries of up to R$3 million in a single year — sums that dwarf the constitutional ceiling the court is now scrambling to defend.
The Dino injunction, reported by Veja, targets the mechanism that legislators have repeatedly exploited to circumvent Brazil's fiscal framework: the passage of ordinary laws that quietly authorise remuneration packages exceeding the constitutional cap, which is pegged to the salary of Supreme Court justices themselves. Dino's order prohibits the enactment of any such new laws while the court examines the constitutional basis for existing exceptions. The injunction is sweeping in scope — it applies to all three branches of government and covers both direct salary payments and the ecosystem of allowances, bonuses, and indemnity payments that have long served as the main vehicle for ceiling evasion.
The Folha investigation revealed precisely what that evasion looks like in practice. Career public servants — including judges, prosecutors, and senior officials — received total annual remuneration packages reaching R$3 million, roughly ten times what the constitutional ceiling formally permits, through the combination of base salaries, statutory bonuses, retroactive payments, and a variety of indemnity classifications that courts have historically ruled exempt from the cap. The report named specific individuals and agencies, documenting a pattern in which the letter of the constitution is observed while its spirit is systematically defeated.
The contrast is stark and politically volatile. Ordinary Brazilians are living through a period of fiscal austerity framed as a national necessity: the Lula government's own spending review, passed in late 2023, imposed real cuts on social programmes and public investment in the name of fiscal discipline. That discipline, it now emerges, has been exercised with considerable selectivity. The same constitutional architecture that constrains federal social spending has been gamed by the very officials charged with administering it.
Dino's intervention is the latest in a series of moves by the STF to reassert control over what legal scholars in Brasília have called the "remuneration chaos" of the Brazilian public sector. Previous court rulings have attempted to define the ceiling's scope, close specific exemption loopholes, and compel transparency on total compensation packages. Each ruling has been met with legislative creativity from Congress and from the judiciary's own administrative bodies, generating new categories of exemption designed to remain just inside the line of constitutional permissibility.
The political dimension is unusually complex. The spending ceiling is not exclusively a government-versus-opposition issue — the public servants collecting supersalaries include members of the judiciary, the public prosecutor's office, and career civil servants whose employment protections span administrations. Pointing at the problem is politically treacherous for a government that depends on the cooperation of those same institutions. Yet the Folha exposé makes silence equally dangerous: in a country where informal workers earn the minimum wage and pensioners face benefit freezes, the image of a public servant collecting R$3 million annually is a political liability that no administration can absorb quietly.
The Dino injunction will now be put to the full STF bench for a decision on whether it should be maintained while the underlying constitutional cases are heard. The court's record on ceiling enforcement is mixed — it has repeatedly ruled in favour of the ceiling's primacy while allowing exemption categories that effectively hollow it out. Thursday's move, however, is the most direct intervention in years, and its breadth suggests that at least one justice believes the incremental approach has failed.
In Brazil, as across Latin America's giant, continental scale creates both opportunity and governance challenges. A federal system covering 26 states, three branches of government, and millions of public employees creates vast space for the kind of diffuse, institutionally embedded extraction that the Folha investigation documented. The STF can plug individual holes; sealing the system requires a political will that, as Thursday's dual revelation made clear, remains unevenly distributed.
