The Government increased public spending for the rest of the year by another $ 8,959 million

For the second time in August and the ninth in the year, the Ministers of Economy, Martín Guzmán, and the Chief of the Cabinet of Ministers, Santiago Cafiero, signed the increase in budget items (Presidency)
For the second time in August and the ninth in the year, the Ministers of Economy, Martín Guzmán, and the Chief of the Cabinet of Ministers, Santiago Cafiero, signed the increase in budget items (Presidency)

Failure to comply with the 29% inflation guideline set in the 2021 Expenses and Resources Budget a year earlier, at a rate that exceeded that threshold in the first 7 months and which is on its way to closing the year in the 50% range Between extremes, among its multiple negative effects is the increase in the items in charge of the Central Administration, despite the fact that it does not have sufficient tax resources to finance it.

Hence, for the second time in August and the ninth of the year, the national government, now through the Administrative Decision 822 published this Wednesday by the Official Gazette with the signature of the Chief of the Cabinet of Ministers, Santiago Cafiero, and the Minister of Economy Martín Guzmán, ordered the extension of the authorization of expenses for the rest of the year in $ 8,959 million, as calculated by Infobae when processing the worksheets with the new assignments and few take-offs detailed in Annex I with 67 folios.

With the increase arranged 13 days before, in that case through the Decree of Necessity and Urgency 489 with the signature of the entire national cabinet and the president of the Nation, for $ 708,000 million, and the 7 previous modifications since the beginning of the year, the original budget was expanded by just over a trillion pesos, 12.1% of the amount approved by the National Congress.

The original Budget was expanded by just over a trillion pesos, 12.1% of the amount approved by the National Congress

In the recitals of the measure, the budget extension is justified in the reinforcement of items for:

1) “Ministry of Economy, in order to meet needs for exchange differences corresponding to awards issued within the framework of the International Center for Settlement of Investment Disputes (ICSID) ”, although the amount is not specified;

2) “National Institute of Seeds, a decentralized body acting in the orbit of the Ministry of Agriculture, Livestock and Fisheries, to meet various operating expenses ”, $ 100 million;

3) “Ministry of Tourism and Sports in order to meet the financing of the Aid Fund for Tourism Providers – Aptur, of the national plan for tourism infrastructure – 50 destinations for the pre-sale of national tourism services and assistance to companies in the tourism sector through a new fund to preserve them and protect jobs in the sector until the moment of normalization of tourism, training workers and preparing companies for a post-pandemic world “, $ 3,710 million; in line with the easing of quarantine due to greater control of the health crisis with the massive arrival of first and second dose vaccines. In addition, in that portfolio, it expanded the item destined to “continue with the program“ clubs in work ”by which renovation projects, maintenance of facilities and infrastructure improvement of neighborhood clubs are financed”;

4) “National Civil Aviation Administration (Anac), a decentralized body acting in the orbit of the Ministry of Transport, in order to meet the expenses corresponding to the personnel hired through the management services agreement “ICAO project Arg / 07/803” with the International Civil Aviation Organization ( ICAO), $ 219.3 million;

5) “Secretariat of Media and Public Communication of the Chief of Cabinet of Ministers, for the purposes of complying with the commitments related to the execution of official advertising ”, until the primary and primary elections in September, and the end of the midterm, in November, $ 580 million;

6) “Agency for the Administration of State Assets (AABE), a decentralized body acting in the orbit of the JGM, for the attention of the expenses that make the normal development of the entity ”;

7) “Ministry of Culture, in order to contribute to the sustainability of cultural sectors, through the implementation of various measures, including the ‘Argentina flourishes’ program, the continuity and expansion of the universe of beneficiaries reached by the ‘extraordinary support for solidarity culture’, the reopening of the Parque Tecnópolis del Bicentenario, Ciencia, Tecnología, Cultura y Arte, a decentralized body acting in the area of ​​the Subsecretariat for Management of Spaces and Special Projects of the aforementioned Ministry, audiovisual productions and the enhancement of cultural and historical spaces “, $ 2,840 million; and for the “National Theater Institute, in order to allow the allocation of subsidies for the development of the program“ Argentina florece teatral ”and the“ Fondo Nacional de las Artes ”, $ 220.2 million;

Sports and Tourism portfolios ($ 3,710 million); and Culture ($ 3,060 million), were the ones that received the most reinforcements in their budgets

8) “Ministry of Health, in order to enable the implementation of the agreement between that ministerial portfolio, Télam Sociedad del Estado, and the Secretariat of Media and Public Communication of the JGM, whose purpose is the development of institutional communication campaigns ”, $ 458.3 million;

9) “Ministry of Environment and Sustainable Development credits and external credit resources in order to achieve a correct execution of the emerging needs of loans IBRD (World Bank) 8493-ar ‘native forests and community project’ and IDB 3249 / oc-ar – ‘Comprehensive Management Program for Solid Urban Waste ‘, $ 930 million; and for the “Administration of National Parks, to meet the expenses that require the participation and presence of the entity in the Parque Tecnópolis del Bicentenario, Science, Technology, Culture and Art”. “Part of this increase is offset by a decrease in credits and financial sources from the budgets of the Ministry of Transportation”, which were destined to the Elevation of the Viaduct, Extension of the Railroad Layout and New Station Construction “in $ 280.3 million.

New extensions and more fiscal deficit

In this way, it deals with an expenditure authorization 41% higher than that of the previous year, still some 10 percentage points below the rate of inflation, so further budget increases are to be expected in the remainder of the year. Even more so considering the plans in the pipeline to boost private consumption until the midterm elections in November.

The expanded budget is now 41% higher than the previous year, still about 10 percentage points below the rate of inflation, so further budget extensions can be expected (EFE)
The expanded budget is now 41% higher than the previous year, still about 10 percentage points below the rate of inflation, so further budget extensions can be expected (EFE)

The data updated by the Ministry of Finance as of Friday, August 13, showed the execution of 56.91% of the authorized expenditure until the end of the year and 61.6% of the total expected resources.

The difference in accrued and effectively paid expenses was a deficit of $ 320,310 million, equivalent to 6.7% of resources. But if in the remainder of the year the items authorized to date are fully executed and the income goal is met, the final balance will be negative by $ 1.26 trillion, equivalent to 41.9% of the total resources expected for the 4 months and a half remaining.

If in the remainder of the year the items authorized to date are fully executed and the revenue goal is met, the balance will be negative by $ 1.26 trillion

Faced with such a gap, In the first half of August, the General Treasury of the Nation received transfers of profits from the Central Bank for $ 160,000 million, 4 times the transfer it received a year before of the monetary entity, in that case under the concept of “Temporary Advances”.

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