The Government will announce the numbers this Friday finals of the National Public Sector (SPN) cash base of 2024which will have the peculiarity that in December there was a financial deficit of between 0.2% and 0.3% of the Gross Domestic Product (GDP).
This is what the Ministry of Economy from the moment it reported the November data a month ago. If the projections are met, in the first year of Javier Milei’s management there would have been a adjustment equivalent to between 4.6% and 4.7% of GDP.
That is because, In December 2023, the accumulated result was a loss equivalent to 4.4% of the Product. Until November, the Ministry of Economy had been adding a financial fiscal surplus of 0.6% of GDP. But December is a month of higher expenses due to the effect of the bonus for public employees and retirees. Thus, it should close the year with an equivalent surplus to 0.4% or 0.3% of GDP in the year.
Beyond the details, it is a formidable adjustment in nominal spending, largely due to real cuts and to a large extent due to the effect of the initial devaluation.
According to data from IERAL, the business school of the Mediterranean Foundationthe correction of Javier Milei’s government is the second most important since records have been recorded. In 1967, the adjustment was equivalent to 1.7 of GDP. In 1977, there was one of 1.7%; in 1984, one of 1.4% and in 1985, one of 4.6%. The latter was the year in which then-president Raúl Alfonsín and Juan Vital Sorrouille, his Minister of Economy, launched the Austral plan.
The fall of budget execution
According to private studies, In 2024, the Budget of the National Public Administration (APN) was 94% executed. This implies that they were about $7 billion unspentaccording to a report from the Argentine Public Budget Association (ASAP).
The National Public Administration (APN) is only one part of the National Public Sector, although it is the most important. It does not include public companies, decentralized organizations and universities.
Then, According to a report by the Center for Argentine Political Economy (CEPA), last year budget execution fell in real terms by 31% compared to what happened in 2023.
What was the least spent on in 2024
According to CEPA,When analyzing spending by public organizations, strong adjustments were detected in the Superintendence of Health Services (-69%), ANMAT (-21%), national hospitals, and even at the National Cancer Institute (-55%) and the National Disability Agency (-17%).
In the case of Laura Bonaparte Mental Health Hospital, of which the government announced its intention to close it, the adjustment year-on-year is 25%.
In scientific matters, there were sharp falls in the Ministry of Innovation, Science and Technology and other organizations in the sector such as CONAE, CONICET and CONEAU.
The oSocial Security agencies are suffering severe cuts in the execution of their budget items. In the case of ANSES, the body responsible for Social Security, the cut reaches -17% compared to last year. Cuts of 69% were also detected in the INAES and 62% in the Secretariat of Children, Adolescence and Family.
Source: Ambito
