During May the Government continued with the task of cutting funds from the governors, with the aim of maintaining the fiscal surplus. According to data from consulting firms, based on official information, The group of 23 provinces and the City of Buenos Aires received 83% less money than what they received in the same month last year.
This is indicated in a report by the consulting firm Politikon Chaco, in which it is pointed out that in the so-called non-automatic transfers from last month expenses of $59.7 billion were accrued, but $71,331 million were paid.
Apparently, the debate taking place in the Senate regarding the Bases law and the Fiscal Package had no impact whatsoever on the decision to maintain the cuts. The data would indicate that the government Javier Milei would not have “opened his wallet” to obtain a favorable opinion.
It is worth remembering that in the opposite direction, last month the Income Tax recorded a real growth in collection of 80% compared to last year, which meant that the provinces received extra funds of 1.7 billion through federal co-participation.
The report indicates that in the accrual stage, That is, at the time the payment obligation is generated, non-automatic transfers fell 87.6%while in the stage paid fell 83.3% compared to May 2023.
“In May the same phenomenon was seen again as in the month of April: the transfers paid were higher than those earned. The paid/earned ratio was 119.5% and generated a reduction in the debt of the national State with the whole of subnational jurisdictions at $11,631 million, although it still accumulates $120,524 million owed for accrued and unpaid commitments,” warns Politikon Chaco.
The report from the consulting firm directed by economist Alejando Pegoraro states that “69.5% of the non-automatic transfers paid corresponded to activities of the Ministry of Health.” According to the work, the money that the Nation sent to the provinces is concentrated in expenses for assistance to Hospitals, as already observed in February, March and April.
“10.1%, for their part, corresponded to shipments from the Ministry of Education and 6.9% were from the Ministry of the Interior,” the report says.
The work maintains that “among the subnational districts “The situation continues to show strong contractions.”. “In both its accrued and paid stages, all jurisdictions presented declines of different magnitudes.”
It also details that “There is the particularity that readjustments are observed in various concepts which generated that in the instance accrued “There are six provinces with a negative sign in the total shipments.” These are Catamarca, La Pampa, San Juan, San Luis, Santa Fe and Tierra del Fuego.
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On the other hand, according to the report, in the accumulated period January–May 2024 accrued transfers fell 79.3% against the same period 2023 in real terms; and those paid at 86% real year-on-year.
Transfers grouped in accrual stage According to jurisdiction of origin, those corresponding to the Ministry of Education exhibit the highest level of participation in May with 69.5% of the total; This is followed by those of the Ministry of Health (23.4%) and the Ministry of the Interior (5.7%). The rest of the shipments account for 5.5% of the total.
To the observer, the transfers paid led those corresponding to the Ministry of Education, which concentrated 47.8% of the shipments; They are followed by those of the Ministry of Health (42.5%) and those of the Ministry of the Interior (3.9%). The rest of the jurisdictions accounted for 8.7%.
Source: Ambito
