The government expects cuts in energy, health and education

New year starts with Adjustments in public spending. Without the exceptional income he earned throughout 2021 – including what he earned before wealth tax– Government Alberto Fernandez They were forced to make deep cuts in various budget items, Even the most sensitive like social spending.

The size of the mods is approx 225 billion dollars According to the latest report from Congressional Budget Office (CBO). This report analyzes a file Administrative decision 4 dictated by the Executive last week, through which the resources and appropriations corresponding to Extension of the 2021 budgetAfter Congress rejected last December the draft budget sent by the executive branch for this year.

In that administrative decision, the Ministry of Economy recognized this in 2022 Total revenue will drop by just over $627 billion. This is due, first of all, to the fact that he will not have the extraordinary income that he earned last year, including Special Drawing Rights (SDR) For 422.174 million dollars, Argentina received according to its participation in the International Monetary Fund. This amount was omitted from current transfers from international organizations, as well as from financial applications.

In addition, the department led by Martin Guzman also eliminated other income from the income category. 204.640 million dollars from the so-called “exceptional and solidarity contribution” – Known as the Wealth Tax – an emergency tax that has only encouraged Kirchnerism in Congress because of the pandemic. The said contribution was made by taxpayers with assets of more than $200 million.

According to the latest data from the Ministry of Economy, as of the last month of last year, taxes collected $247.503 million in taxes. Since this extraordinary contribution has already ended, the items fueled by this tax have been seriously cut off: The Secretary of Energy, for example, will incur a loss of $60,190 million, while the Ministries of Health, Education, Labor, Employment and Social Security will lose $48,150 million, respectively.

However, the cuts will cover other areas as well. The Ministry of Social Development, a key area that manages millionaire items to meet social emergencies, will receive a trim of $4847 million. Meanwhile, the “obligations responsible for the treasury” line, where transfers are made to provinces and public sector companies, would see a drop of just over $3,000 million.

In Administrative Decision No. 4, the government also canceled the appropriations for Ministry of Interior Affairs Expenses corresponding to the primary and general elections held last year. This total amount is 19.532 million dollars.

The only portfolio that avoided the amendment, but rather received an increase in its item, is the Ministry of Environment and Sustainable Development, Led by Juan Cabandié: This year he will receive an additional $4,847 million, which will be worth the game $16,771 million.

Thus, with the budget adjustment for this year, the income estimate starts at a total of $ 7.9 trillion (-627,025 million compared to December 31, 2021), while the initial expenses – that is, without considering the payment of interest on the debt – will total $ 10 billion (- $224,889 million). Subsequently, The primary fiscal red will deepen in 2022, which will rise to just over $2 trillion (+ $402,136 million compared to the end of fiscal year 2021).

These numbers do not necessarily mean that this spending cut policy will continue throughout the current year. On the contrary, the opposition hopes, as it did in the past two years, The government re-amends the various items through decrees of necessity and urgency With revenue increasing due to inflation.

For example, throughout the past year, especially during the last quarter, the government has unleashed spending as a result of the election campaign and Budget lines increased by 2.6 trillion pesos – 31% – compared to the initial appropriations. Much of this rise is due to the strong expansion of capital spending (mainly public works) and economic subsidies (particularly energy) which, as of last November, increased by 21% and 29% in real terms respectively.

Despite this strong increase in spending, Minister Guzmán succeeded in improving the primary fiscal deficit, which last year amounted to about 3% of GDP. This was thanks to the extraordinary income received by the treasury (special drawing rights from the International Monetary Fund and wealth tax), which will not be counted this year. very It is possible that the treasury collects less by deducting from the field; Although this ingredient was key to the pickup increase last year due to the record crop of soybeans, drought Can play a trick on the government this year: According to The National State Rosario Stock Exchange will stop collecting export duties of USD 1,038 million due to reduced agricultural production.

Plus an increase in the amounts booked due to the record harvest of soybeans. However, the deductions collection