(Bloomberg) -- Brazil's lower house of Congress approved the use of taxpayer money to finance election campaigns amid wide-spread disillusionment with the country's political class in the run-up to 2018 general elections.
The Chamber of Deputies late on Wednesday approved a 1.7 billion reais ($542 million) fund that will be allocated according to each political party's representation in Congress, according to the lower house's news agency. Legislators cut the size of the fund from an initially proposed 3.6 billion reais amid a public outcry after years of corruption scandals involving kickbacks to politicians from public contracts.
To further assuage critics, the fund will be bankrolled in part by pork barrel spending traditionally earmarked for senators and deputies. The bill that had already passed the Senate now goes to President Michel Temer's desk to be signed into law.
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Legislators have struggled over how to fund Brazil's politics, since a Supreme Court ruling in 2015 prohibited corporate donations. Widespread disenchantment with the country's political elite has left the field wide open for next year's elections and boosted the chances of outsiders at the ballot box.
New rules on how to distribute the election fund will benefit larger parties, and particularly Temer's PMDB party, by allocating 15 percent of the fund proportionally to the seats held in the Senate. The rest will be distributed according to representation in the lower house, both current and that following the last elections.
Other political reforms passed by the lower house earlier this week include the end of electoral coalitions for legislative elections. Congress had also limited access to a separate fund to those parties that succeed in electing nine federal deputies or win 1.5 percent of the vote in nine of Brazil's 27 states. The threshold will rise in subsequent elections.
The intent of the bill is to reduce the number of parties in Congress from currently 25, a figure that has made forging and maintaining governing coalitions a daunting task.
To contact the reporters on this story: Simone Iglesias in Brasília at spiglesias@bloomberg.net, Bruce Douglas in Brasilia Newsroom at bdouglas24@bloomberg.net.
To contact the editors responsible for this story: Vivianne Rodrigues at vrodrigues3@bloomberg.net, Matthew Malinowski, Raymond Colitt
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