When closing the In the first half of the year, the Government can assure that it has fulfilled its promise to adjust spending public. According to private estimates, the level of Budget execution until June fell 30% if the accrual for the same period last year is taken.
This includes expenses in subsidies for energy generators that have not yet been paid. Because of that in June The state accounts are likely to end up looking good, although Javier Milei himself had anticipated a few weeks ago the first fiscal deficit of his administration.
Can there be a surplus in June?
The level of energy subsidy expenditure is very important in relation to the total and that is why Delaying payment is an instrument used by the various Ministers of Economy in recent years to improve the appearance of public accounts.
In this case, in May The Ministry of Economy cancelled a debt with electricity generating companies for approximately $600 billion. The companies agreed to collect a 2038 bond (Bonar 2028 or AE38) for overdue debts at a 50% discount. And after that, the Government promised to normalize monthly payments, although that has not happened.
According to the information provided by the Congressional Budget Office, Caputo pledged to pay bills starting in Marchmaturing in May, in full under the terms and conditions established in current regulations.
But the Association of Electric Power Generators of the Argentine Republic (AGEERA) He sent a note a few days ago to the head of the Palace in claim for payment of that accrued debt. They say they have collected 35% of the April bill.
How is the Government approaching the first half of the year?
In the first five months of the year, the Government was able to accumulate a surplus, something unusual in Argentine history.. June may be added. The Last month he had achieved this thanks to the extraordinary income from the Income Tax of companies, which had extraordinary returns due to having dollarized assets in December, when the devaluation occurred.
According to a report by the Argentine Center for Political Economy (CEPA), During the first half of this year the National Public Administration executed expenses for $36.8 billion, while in 2023, in current currency, it had done so for $52.6 billion.
“A high incidence of S is observedSocial Security out of the total, since it accounted for more than 51% of the total expenditure,” details the study.
Secondly, the Public Debt Services They accounted for 13% of total expenditure and then other functions with minor impacts were located, as Energy with 8%, Education and Culture (5%), Social Promotion (4%), Health with 4%, Transportation (3%); and the rest of the openings with an incidence of less than 3% of the total execution.
If taken only as a reference to the expenses of the National Public Administration, which does not cover the entire National Public Sector, a downward trend can be seen.
For example, in the recent message from the Executive Branch to Congress, where the first advances are made 2025 Budget Bill, The Government currently recognises a level of execution of around 65% with respect to current credits.
But these credits are actually added in a more or less arbitrary manner, given that the current budget is an extension of the 2023 budget. If the correct inflation projections had been made at the beginning of the period, it is likely that the level of execution would not exceed 20%.
Source: Ambito
