MPS Sets Interest Rate for RPPS Actuarial Calculations in 2027

On October 13, 2026, Brazil’s Ministry of Social Security (MPS) set the interest rate that the public-sector pension systems (RPPS) will use in their 2027 actuarial calculations. The rates range from 6,08% to 6,58% per year and determine the size of the deficit each government entity will have to address.

What Guidance 3/2026 Requires

On October 13, 2026, the Department of Public-Sector Pension Systems, part of the Secretariat of Public-Sector and Supplementary Pension Systems, signed Guidance No. 3/2026/DRPPS/SRPC-MPS. The act defines which benchmark interest rates must be used in the actuarial valuations of public-sector pension systems for fiscal year 2027, with a valuation date (data focal) of December 31, 2026.

The answer is in the column “Taxa de Juros Parâmetro (% a.a.)” (Benchmark Interest Rate, % per year) of Annex I to Previc Ordinance No. 324 of April 23, 2026, in force since April 30, 2026. That ordinance published the Average Interest Rate Term Structure for fiscal year 2026 and replaced Previc Ordinance No. 343 of April 13, 2025.

The reason for the act is simple. Annex VII to MTP Ordinance No. 1.467 of June 2, 2022, which sets out the general parameters for public-sector pension systems, covers only the rates applicable to fiscal years 2019 through 2026. Without the Guidance, actuaries would reach December 2026 with no published rate for the next valuation.

The table reproduced in the act starts at the 1,0-year point, with 6,58% per year, falls to a floor of 6,08% at the 4,0 to 8,0-year points, and then rises gently to 6,15% at the “33,0 or more” point. Unlike the 2026 column of Annex VII, which extended to the “35 or more” point, the Previc table ends at 33,0 years.

How the Duration of the Liabilities Determines Each System’s Rate

There is no single rate for all systems. Article 39 of MTP Ordinance No. 1.467 of 2022 ties the discount rate to the point on the Average Interest Rate Term Structure closest to the duration of the system’s liabilities. Under Article 29 of the same ordinance, the duration of the liabilities is the average of the payment terms of the benefit cash flows, net of the beneficiaries’ contributions, weighted by the present values of those flows.

According to the Guidance, the duration used to select the rate is the one calculated in the valuation itself, with a valuation date of December 31, 2026. It is computed under Article 35 of Annex VI, which discounts the net benefit flow to present value at the rate used in the valuation with a valuation date of December 31, 2025. The calculation is done separately for each group of insured members.

When the duration, expressed to one decimal place, does not match a point on the table, the immediately preceding point applies, under § 3 of Article 39. The act itself gives examples: a duration of 12,3 years falls on the 12,0 point, with a rate of 6,10% per year; a duration of 18,8 years falls on the 18,5 point, with 6,11% per year; and a duration of 33,0 years or more receives 6,15% per year.

The Guidance rules out two possible misreadings. The “Limite Inferior” (Lower Limit) and “Limite Superior” (Upper Limit) columns of Annex I do not apply to public-sector pension systems, because they form part of the range set out in CNPC Resolution No. 30 of October 10, 2018, which closed supplementary pension entities use when applying to Previc for authorization.

The second concerns the add-ons. The additional 0,15 percentage point remains available for each fiscal year, among the five preceding the valuation date, in which the system actually achieved the rate it adopted, capped at 0,60 percentage point. The add-on does not apply to systems with assets below R$ 10.000.000,00 or to the Pay-As-You-Go Fund (Fundo em Repartição), and its use must be recorded in the Statement of Actuarial Valuation Results, in the field “Projeção da Taxa de Juros Real para o Exercício” (Projected Real Interest Rate for the Fiscal Year).

Why This Number Shows Up on a Public Employee’s Paycheck

The discount rate is the mechanism that converts decades of future benefits into a present value. The higher the rate, the smaller the liability measured; the lower the rate, the larger the commitment that appears on the system’s balance sheet. The result of that calculation is not abstract: it determines the actuarial deficit and, right after that, the funding plan that the government entity must enact by law.

The duration of the liabilities has another direct effect as well. Under § 2 of Article 35 of Annex VI, it is used both to set the benchmark interest rate and to calculate the maximum term of the amortization plan and the amount of the deficit to be addressed. Together, the term and the amount determine how much new money flows into the system each year.

This new money has a technical name. Technical Note SEI No. 900/2026/MPS of July 13, 2026, dealt precisely with the regulatory method for setting and changing the supplementary contribution rates and the capital contributions used to address the actuarial deficit of public-sector pension systems, including where the law authorizes the Executive Branch to regulate the matter.

The discount rate does not change the retirement rules for public employees, but it does change the size of the bill that the government entity and the insured member will have to pay.

The Guidance notes that the benchmark interest rate has increased and, even so, keeps three duties in place for the system’s manager. The first is to evaluate adopting a lower rate, using prudence criteria demonstrated in the Actuarial Valuation Report, under § 6 of Article 39.

The second duty is to show, in the same report, the actuarial gains and losses resulting from the change in rate, under § 7. The third applies to the Pay-As-You-Go Fund and the other situations covered by § 4 of Article 26: in those cases, the actuarial result must be presented twice, once with the benchmark rate and once with a rate of 0%, as required by § 9.

The Timeline and What to Look for in Your Own System

The sequence of these acts explains the one-year lag between Previc’s publication and the valuation that uses it. Article 50 of Previc Resolution No. 23 of August 14, 2023, sets the first business day of April as the calculation base date and requires the Average Interest Rate Term Structure to be published by April 30 of each fiscal year. This is the most recent reference available for the valuation dated December 31 of the same year, which, for public-sector pension systems, corresponds to the valuation for the following fiscal year.

The history confirms the mechanics. The 2025 column of Annex VII reproduced the table from Previc Ordinance No. 308 of April 25, 2024. The 2026 column, as reworded by MPS Ordinance No. 2.010 of October 15, 2025, reproduced the table from Previc Ordinance No. 343 of April 13, 2025.

The act itself announces that an amendment to MTP Ordinance No. 1.467 of 2022 will be proposed to make clear that the benchmark rate corresponds to the point on the Term Structure published annually by Previc, which would eliminate the need to republish Annex VII every year. Until that change is issued, the provisions of the Guidance apply.

If you are a public employee, or advise public employees, the document to look for has a specific name and location. The Statement of Actuarial Valuation Results and the Actuarial Valuation Report of your government entity show the duration of the liabilities for each group, the rate actually adopted, the gains and losses calculated, and the term of the amortization plan.

With those four pieces of information in hand, the next thing to read is the local law that sets the normal contribution rates, supplementary contribution rates, and capital contributions. That is where the actuarial calculation turns into a monthly payroll deduction. A system that adopts a rate below the benchmark out of prudence tends to show a larger deficit today and less pressure for revision later; the reverse also holds.

It is worth remembering that the Ministry’s regulatory authority in this area rests on Article 9 of Law No. 9.717 of November 27, 1998, which authorizes the establishment of general parameters to be observed by the public-sector pension systems of the Union, the States, the Federal District, and the Municipalities.

Frequently Asked Questions

Does Guidance 3/2026 change the age or length of service required for a public employee to retire?

No. The act deals only with the interest rate used as the discount rate in the actuarial valuations for fiscal year 2027. The requirements for age, contribution time, and time in the position continue to be governed by constitutional rules and by the legislation of the government entity to which the employee belongs.

Where can a public employee check which rate was applied to their system?

In the Statement of Actuarial Valuation Results and the Actuarial Valuation Report published by the managing unit. You need to find the duration of the liabilities for the group in which the employee falls and, if it does not match a point on the table, apply the immediately preceding point to find the corresponding rate.

Can a system adopt a lower rate than the one published?

Yes. Paragraph 6 of Article 39 of MTP Ordinance No. 1.467 of 2022 allows a lower rate as long as the prudence criteria are demonstrated in the Actuarial Valuation Report. The benchmark rate, plus any applicable add-ons, works as an upper limit, never as a mandatory floor.

As informações deste artigo são de caráter informativo e não substituem consulta jurídica individualizada. Cada caso possui particularidades que exigem análise específica.