The
liquidation of pensions
for the first two months explains almost
half of the total reduction in primary public spending
, before interest payments.
The rest were transfers to the Provinces, PAMI and Universities, according to a report from the
IARAF
(Argentine Institute of Fiscal Analysis).
In February, the primary expenditure accrued by the National Administration was $4,070,000 million.
By discounting last month's estimated inflation,
spending would have fallen by 36.4% in real terms compared to February 2023.
This fall would be greater than those registered in the last two months (23.2% and 30.1%).
Accrued expenditure
records
the
commitment assumed by
the public sector, for example, sending funds to a province.
The
expense paid
, for its part, records
the amount of money actually sent
to that province.
If less money is paid or sent than what is earned, a debt is generated, usually called floating debt, which
is what is happening in these months
.
The Report adds that, with these figures, in the accumulated
first two months
of the year, primary spending would have fallen by 33.6% year-on-year.
The items with the greatest real interannual decrease would have been: total transfers to
provinces (-65%),
Goods and services (-46%), benefits from the
National Institute of social services for retirees and pensioners
(INSSJP-PAMI)
, with -39, 5%,
Universities (-30.1%) and Family Allowances (-15.6%).
The
most important expenditure, that of retirements and pensions,
would have decreased
by a real 32.6%
year-on-year, somewhat less than the real fall in average expenditure.
From the analysis of the accrued expenditure, a very negative conclusion emerges, the Report recognizes:
the reduction in retirement expenditure would have been equivalent to 43% of the total reduction in real expenditure executed in the first two months
.
In the case of salary expenses, the reduction would have been equivalent to 5% of the total reduction.
“This reflects that the
liquefaction of pensions and salaries
in the first two months explains half of the total reduction in primary spending carried out in the period.
The other side of such a loss of purchasing power is a
significant drop in real spending on retirements and, therefore, in total spending
,” the Report concludes.
With the 27.18% increase and the bonus of up to $70,000,
minimum wage retirements and pensions will collect a total of $204,445 gross during March, April and May
.
The total breaks down to $134,445 plus $70,000.
Consequently, with these values, the minimum assets will have
a loss in purchasing power of 33%
compared to March 2023. And for those who did not and will not collect the bonus, the loss rises to 44% in 12 months.
The loss is accentuated in April and May.
With these numbers, and in relation to a year ago, the purchasing power of the assets is as follows:
In March 2023,
the minimum asset was $58,665 plus a bonus of $15,000: a total of $73,665.
In March of this year,
the minimum asset will be $134,445 plus $70,000 of the bonus: total $204,445.
It represents a year-on-year increase of 177.5%.
With inflation of 16% in February and 15% in March,
year-on-year inflation would rise to 311%
.
The difference is equivalent to a loss of purchasing power of 32.6%.
NE