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performing AAA in our sample across all but one dimension in Table 5. The TCU has a long historical trajectory dating back to the first republican constitution of 1891. It was established at the insistence of the executive shortly after Brazil became a republic in 1889 to rein in federal spending and prevent the misuse of public resources (Roque Citadini 1995). Its main architect was former finance minister, Rui Barbosa (Barbosa and Fonseca 1994). Its first organic law which dates back to 1896 sets the its internal structures, rules and procedures. These have remained relatively stable until today, with some modifications.

The TCU is a collegiate body modeled as an administrative tribunal of accounts with quasi- judicial powers. A board of nine auditors-general, or ‘ministers,’ with ample guarantees of individual independence, governs the TCU (Rocha 2003; Brown 2002a, 2002b). Auditors-general are appointed for life and have the same rights, privileges and immunities as members of the Supreme Court of Justice. The federal President appoints three auditors-general with the approval of the Senate. The legislature appoints the other six auditors-general, three being appointed by the Senate and three by the Chamber of Deputies. Moreover, two of the three ministers nominated by the federal President must be chosen from the TCU’s career personnel, restricting the President’s choice. The president of the TCU is selected by his peers and rotates every year but, since 1934, can be re-elected for up to three years. Audit reports are adopted by majority vote (there are some cases which are reviewed by a subset of the nine auditors-general).

The composition of the TCU thus reflects legislative preferences, rather than executive preferences. Auditors-general often are former legislators. As in Argentina, the nomination process is highly politicized, but politicization is tamed by the life tenure of the Brazilian auditors-general and the professionalism of the agency staff. It is expected that, over time, the political connection of auditors-general will gradually diminish, as government majorities change and auditors-general develop a sense of professional and corporate allegiance. The 1988 Constitution also establishes requirements for candidates as auditors-general in terms of technical capability and professional experience.

Although functionally dependent on the legislature, the TCU is an autarkic agency with ample autonomy. As in Argentina, the oversight of public finances and the evaluation of government performance are constitutionally entrusted to the legislature, which is assisted by the TCU. For example, only the legislature can suspend federal public contracts in case of alleged impropriety. The TCU performs routine oversight of government finances on behalf of the legislature.21 Its core function is to oversee the accounts of federal entities, primarily through legal and financial compliance auditing, ‘the political control of accounting and financial legality par excellence(Lopes Meirelles 1989:602).

The TCU must ensure the integrity of financial administration, the probity of public spending and the lawful execution of the budget. All in all, the TCU has jurisdiction about 2600 direct and indirect public administration units (compared with 2288 in 1991 and 3275 in 1996), as well as federal funds administered by the 26 states, the federal district and the 5564 municipalities (TCU 2003). It has control and inspection functions (through special inspections and operational audits), consultative and normative functions (through the advise it provides to the legislature), as well as corrective powers (through the imposition of sanctions and correcting administrative acts or omissions). In terms of enforcement capabilities, in addition to reporting alleged irregularities to the judiciary, the TCU has direct sanctioning powers in administrative matters. It judges the accounts of public managers and imposes administrative sanctions in case of impropriety. As such, ‘when the TCU gives its final verdict on the correctness of administrators, it is undeniably

21 The special ad-hoc inquiry commissions of the legislature, the Comissões Parlamentares de Inquérito, are more intrusive forms of ‘fire alarm’ oversight established to investigate allegations of corruption.


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