(Bloomberg) -- Brazil President Jair Bolsonaro is unveiling a package of social spending that will inject 165 billion reais ($32.4 billion) into the economy as he redoubles efforts to boost support ahead of this year’s elections.

The government will allow withdrawals of 1,000 reais from FGTS severance funds, bring forward 13th salary payments that are typically made later in the year and guarantee loans for workers with troubles accessing credit, according to two people familiar with the matter. The plan, which do not represent additional public spending this year, is focused on the poor and middle-class and will be announced at an event at the presidential palace on Thursday.

Additional measures are expected in the coming weeks. Bolsonaro’s administration will modernize rules for remote employment and also app workers, said the people, who requested anonymity because the discussion isn’t public. He will also have to decide whether to earmark 1.7 billion reais for public servant pay hikes this year.

The president is rolling out the measures as a challenging outlook for Latin America’s largest economy complicates his re-election bid. Inflation is soaring well above target, unemployment has been slow to fall and gross domestic product is seen expanding just 0.5% this year. The president is trailing leftist rival Luiz Inacio Lula da Silva in all major polls ahead of the October vote.

Fuel Costs

The announcement comes a week after state-controlled Petroleo Brasileiro SA raised fuel prices by as much as 25% and as Russia’s invasion of Ukraine prompts a global spike in commodities. To cushion the impact on consumers, the government rushed a bill through congress that cuts taxes on diesel and cooking gas, and Bolsonaro wants to do the same for gasoline.

Economy Minister Paulo Guedes opposes lowering gasoline taxes, pointing out that the tax cuts combined would cost public coffers 46 billion reais. Instead, if the war in Ukraine persists, his team would consider a decree boosting the amount paid through the Auxilio Brasil social program to help poor families contend with higher fuel costs, according to two separate people with knowledge of the matter, who also asked not to be named because the discussions are private.

Read More: Brazil Congress Amps Up Pressure on Petrobras to Cut Fuel Prices

Inflation, employment and other economic issues are Brazilians’ main concern ahead of October’s presidential election. A survey released on Wednesday by Genial/Quaest showed 51% of respondents identified the economy as Brazil’s main problem -- far ahead of the pandemic and health care, cited by 12%, social issues by 11% and corruption by 10%.

Read more: Brazil Cash Aid Buoys Bolsonaro’s Popularity Before October Vote

Bolsonaro’s popularity is already getting a boost from a program of cash handouts he rolled out a few months ago. Among poll respondents who voted for him in 2018 and currently receive the handouts, dubbed Auxilio Brasil, 23% said the government is doing worse than expected, down from 45% in February. Meanwhile, 31% of them said the administration is doing better than expected, up from 25% previously.

Yet Bolsonaro’s approval rates still suffer among the broader population: 49% of all the respondents said they had a negative impression of his government, while 24% had a positive view.

“Bolsonaro has a re-election project that entails using public resources to finance the possibility of obtaining more votes,” said Tania Bacelar, a partner at consultancy Ceplan. “All signs are that we are going to have a difficult 2022. Therefore, the economy will be at the center of the election debate.”

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