Only a few days from the announcement of a large cut on the Federal Budget, the Ministry of Transport has been preparing a large reduction of costs. A work group formed in late February by the Minister Antonio Carlos Rodrigues will present its findings by the end of this month. In ongoing studies, the main “victim” of the adjustment tends to be the Empresa de Planejamento e Logística (Planning and Logistics Company – EPL), which can suffer staff cuts.
State company originally created to take care of the legendary High-Speed Train (TAV), the project that once has been the apple Dilemma Rousseff’s eye, EPL has seen its main logistic ambition be put away and got involved in infrastructure concessions. Today, it is treated as a division that lost most of its raison d’être.
The State found that the state company will postpone the contracting of environmental studies of future infrastructure concessions. This represents a strong change in the company orientation, so that undertakings were already offered to the private sector with half way through to obtain environmental licenses. Infrastructure works impact analysis takes more than one year, which is the deadline required to observe the flora and fauna behavior of affected sites.
Following general orientation of the entire Transport portfolio, EPL is also renegotiating agreements with its suppliers. It is a measure traditionally adopted in fiscal adjustment times and it aims to obtain discounts over prices of ongoing services, which is justified by the spending restriction chart.
Cut
The guidance is to cut and reduce at least 20% of administrative expenses in the entire ministry. Works will be spared. However, the cut will affect items such as cleaning, safety, receptionists and water and electricity bills. A significant reduction on rent expenses is also expected.
In these financial rearrangements, the work group also studies to leave EPL, which holds two floors of a luxurious set of commercial rooms in the Federal Capital downtown area. The rent is quoted in the market by BRL 500 thousand per month. The employees will probably be relocated to the building occupied by the National Agency of Land Transportation (ANTT), which is also rented. Change is still under analysis.
Address change should also affect the railway state company Valec, probably moving from the 4-story building, also rented. The most likely idea is to transfer it to the property owned by the National Department of Transportation Infrastructure (DNIT), which nowadays has sufficient room to house “homeless” divisions from other portfolios, such as Sports and Planning.
EPL has become prime target of cuts since its main project, the bullet train, has been filed without date to be resumed. Sequence of failures to bid this work between 2011 and 2013 led to the departure of its former CEO, Bernardo Figueiredo, who was the brains behind the company. On the backstage, it was said that the state company had been created by Rouse to accommodate her “sweetheart” after his reelection to ANTT Presidency was rejected by the Senate. This information is from O Estado de S. Paulo newspaper.
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