He primary deficit accrued from the National Public Administration (APN) It amounted to 6 trillion 22,787 million pesos in 2023, with a nominal increase of 106.6% which, being lower than the average inflation of the year, represented a drop of 11.5% in real terms and a value equivalent to 3. 2% of Gross Domestic Product (GDP), according to what was reported by the Congressional Budget Office (CPO).
For his part, the financial deficit (which includes public debt services) was 9 trillion 471,762 million pesos last year, with an annual increase of 111.2% at current values and a decrease of 9.5% at constant values, equivalent to 5 % of GDP.
The OPC information anticipates what will be announced on Monday, January 22, by the Ministry of Economy, although the numbers are not comparable due to methodological differences: that of the bicameral body refers to the expenditure accrued from the APN and that of the Treasury to that carried out by the Non-Financial Public Sector, which also includes public companies and trust funds.
Fiscal deficit: income and expenses were below 2022
The figures are the result of total income of 28 billion 650,718 million pesos, total expenses for 38 billion 122,480 million and primary expenses for 34 billion 673,505 million.
In all cases there was real setbacks compared to 2022 levels: Income fell by 5.9%, total expenses fell by 6.8%, and primary expenses fell by 7%.
Fiscal deficit: in December expenses doubled income
Although the OPC report does not specify the December budget execution, Based on the comparison with the accumulated from January to November, it is clear that in ehe last month of 2023 (of which 21 days corresponded to the Presidency of Javier Milei) the total income was 3 billion 532,685 million pesos, total expenses of 6 billion 209,212 million and primary expenses of 5 billion 823,368 million pesos.
Consequently, in December there was a primary deficit of 2 trillion 290,683 million pesos and a financial one of 2 billion 676,527 million.
Fiscal deficit: why state income fell
The negative real variation observed in resources is fundamentally due to the decrease in tax revenue (11% real), due to the real falls in Export rights (57%) and Income Tax (21.5%), partially offset by positive real variations in the VAT collection (8.2%) and COUNTRY tax (118%).
In the opposite direction, non-tax revenues increased (61.2%) and property income (33.3%) originated, in the first case, from the awarding of 5G service licenses ($308,651 million and without execution in 2022) and in the second, from the interests generated by the Sustainability Guarantee Fund (24.3%).
Primary expenses: family allowances and retirements fell
On the side of primary expenses, which presented a real decrease from one year to the next of 7%, according to the OPC “the dynamics were mainly driven by the drop in retirements and pensions (6.1%), family allowances (31.1%) and energy subsidies (26.5%)”.
This behavior was partially offset by increases in personnel spending (8.5%), current transfers to provinces (8.1%) and transfers to universities (6.2%).
“In the case of retirement expense, The drop in spending would have been 12.4% if the extraordinary bonus policy had not been in place, which partially compensated for the savings due to application of retirement mobility“said the parliamentary body.
In this regard, it must be taken into account that for the measurement of real variations, end-to-end inflation (211.4%) is not taken into account, but rather the twelve-month average (133.5%).
Source: Ambito
