The Brazilian government has announced significant changes to the withdrawal rules of the Fundo de Garantia por Tempo de Serviço (FGTS) related to the anniversary withdrawal scheme. Starting March 6, 2025, approximately 12.1 million workers who opted for the anniversary withdrawal will be able to access their held funds, with disbursements totaling about R$ 12 billion. This relief targets those employees who were dismissed from their jobs yet could not access their FGTS balances due to the conditions of this withdrawal option.
The announcement was made by Minister of Labor, Luiz Marinho, during the presentation of employment data. The specifics of the new measure come through a Provisional Measure (MP) expected to be published on February 28, 2025. This MP will allow those who, since January 2020, chose the anniversary withdrawal and find themselves dismissed without being able to retrieve their funds to access their money, easing their financial burden.
Workers will receive the released funds in two installments. The first payment of R$ 6 billion will be made at the outset, providing eligible individuals with up to R$ 3,000 automatically credited to their registered accounts on the FGTS application. The second installment, also R$ 6 billion, will follow for those with funds over R$ 3,000, scheduled for disbursement 110 days later.
Luiz Marinho emphasized the necessity of this measure, stating, “The social protection of the worker has been weakened. The FGTS is intended as individual savings to support the worker during unemployment, but accessibility has been hindered.” Since its instatement, the anniversary withdrawal scheme has seen R$ 142 billion drawn from the FGTS, with banks receiving about 66% of this amount as collateral against loans, leaving only 34% available directly to workers.
The anniversary withdrawal scheme, initially set up under the administration of Jair Bolsonaro, allows workers to withdraw portions of their FGTS annually during their birth month. While the action is optional, it came with substantial trade-offs, namely the forfeiture of total access to FGTS funds when dismissed, affecting workers' financial security during transitions.
Under the new legislation, the substantial majority of benefitted individuals—approximately 93.5%—will fall below the R$ 3,000 mark typically withdrawn, indicating the program’s intent to assist those affected the most acutely.
Upcoming details of the MP specify the parameters under which workers will access their funds. The first payment for those with registered accounts will occur on March 6 for those born between January and April; accounts will be credited for those born from May to August on March 7, and the remaining for those from September to December on March 10. The secondary disbursement for those exceeding R$ 3,000 will be processed on specific June dates.
Despite the immediate support intended through these adjustments, questions linger about the viability of the initiative. Workers who join the scheme after the publication of the MP will continue to see their accounts untouched upon dismissal, maintaining existing withdrawal protocols whereby only 40% severance pay applies without access to the FGTS total.
Further, Marinho noted, “Many workers remain unaware of issues surrounding the anniversary withdrawal; they may think they'll retain access if the need arises. Unfortunately, this misunderstanding exacerbates the risks associated with unemployment.”
The MP’s provision signifies only temporary financial relief, solely accessible to workers dismissed without just cause between early 2020 and the MP’s effective date. Post-implementation, adherence to existing rules will resume, reinforcing existing restrictions on accessing the total balance as well as the need for explicit awareness about the withdrawal types.
Backlash against this newly proposed measure stems from broader societal concerns—will there be sufficient funding for future public housing policies? The government’s infrastructural plans for housing often rely on funds deposited within the FGTS, and many officials worry excessive withdrawal today could stifle such developments.
A case study example pertinent to this dialogue highlights potential issues surrounding pre-existing debts. Luiz Marinho indicated the vast number of those receiving funds may not realize they had previously taken out loans secured with their FGTS, which will limit their total withdrawal capabilities.
“A worker might have R$ 75,000 stored, but after borrowing R$ 35,000, only R$ 40,000 is usable for immediate withdrawal,” explained Marinho. This reveals the challenge facing individuals needing to navigate their withdrawal pathways during tumultuous employment circumstances.
To qualify under the new measure, workers must have actively selected the anniversary withdrawal prior to being laid off. This initiative not only aims to alleviate immediate distress but also serves to highlight the importance of comprehensive educational campaigns about workers’ rights and the financial avenues available through their labor contributions.
Marinho’s projections suggest the actions taken will stimulate the broader economy—injecting R$ 12 billion at this moment could be significant, particularly against the backdrop of rising food prices and economic challenges faced by many Brazilian households. Overall, the government’s efforts adapt to immediate pressing needs are commendable but require diligent oversight and public engagement to educate workers about the proposed benefits.
With the impending publication of the MP, emphasis must also be placed on long-term structural integrity of the FGTS as well as sustained dialogue between government and labor groups to ascertain fair and effective financial management moving forward.