Workers at Brazil's regulators to stage 48-hour strike

Workers at all 11 of Brazil’s regulators called a 48-hour strike to demand better pay and conditions, threatening to delay projects and permits.

The strike will be staged July 31-August 1 after the labor unions rejected a proposal from the government to increase salaries by up to 21.4%. Workers represented by the Sinagências union said salaries have not been adjusted appropriately since 2017, while inflation was 45.35% from 2017 to mid-2024.

"Employees from all 11 regulatory agencies will stop providing important services for the functioning of the economy, such as control and inspection at ports and airports, the supply of electricity and water, as well as other services regulated and supervised by the regulatory agencies, whose coverage area comprises 60% of GDP," Sinagências said in a statement.

"We recently had a strike at [federal environment agency] Ibama that delayed a series of analyses of environmental licenses for projects in the electric power, oil and gas and mining sectors and now this move by [workers at] regulators could cause further delays in such processes," Carlos Daltozo, head of equity analysis at Eleven Financial Research, told BNamericas.

"We can also see delays in the advancement of some sectoral frameworks. For example, in the case of sanitation, where there is strong growth in investments and new projects, there are still a series of additional regulations that need to advance," he added.

Sectors such as electric power and oil and gas, which have robust regulators in Aneel and ANP, respectively, attract more investments as they provide more security for investors.

However, in recent years, employees at regulators have complained about the lack of resources to improve salaries and to expand hiring.

This scenario could become more complicated as the federal government recently announced measures to freeze part of the budget for this year and next.

"The federal government's budget cuts can directly impact the improvement in the structure of the regulators that employees are requesting," said Daltozo.

The 11 regulators recently published a joint letter criticizing the lack of funds.

"The reality experienced by regulators puts at risk all the progress over these years, given the critical budget and personnel situation they are facing. Regulators are responsible for collecting more than 130 billion reais [US$23bn] per year, while the budget foreseen for 2024 was around 5bn reais, an insufficient amount compared to the needs, which in itself demonstrates the economic advantage of this regulatory model," the watchdogs said in the open letter.

"We were surprised by a budget cut of around 20%, which could make it unfeasible to carry out necessary actions so there can at least continue to be solid regulation." 

Currently, more than 65% of positions at regulators are vacant as the government has not approved new hires to replace employees who leave or retire.

The open letter was signed by the 11 regulators: Agência Nacional de Águas (ANA); Agência Nacional de Aviação Civil (Anac); Agência Nacional do Cinema (Ancine); Agência Nacional de Energia Elétrica (Aneel); Agência Nacional de Mineração (ANM); Agência Nacional do Petróleo, Gás Natural e Biocombustíveis (ANP); Agência Nacional de Saúde Suplementar (ANS); Agência Nacional de Telecomunicações (Anatel); Agência Nacional de Transportes Aquaviários (Antaq); Agência Nacional de Transportes Terrestres (ANTT); and Agência Nacional de Vigilância Sanitária (Anvisa).

The regulators started to be created in 1997 as a result of the privatization program under the Fernando Henrique Cardoso administration (1995-2003).