Kirchnerites admit may reach 2011 without Budget bill

By Rubén Rabanal

The Kirchnerite sector knows the Congress is not likely to pass a pro-government 2011 Budget bill. However, some changes and modification implemented to the current Budget bill could be enough for the government to continue running the country without trouble. Despite this latter, if the Congress fails to pass the Budget bill, the extension of some faculties and presidential abilities is not automatically granted. This doesn't seem to be an issue for the Kirchnerite sector, which is used to re-allocate budget funds and re-distribute surplus tax revenue in mega-DNU emergency decrees.

Deputy Agustín Rossi, head of the Victory Front caucus in the Lower House, yesterday didn't seem to be worried about the fact that the opposition might end up modifying the Budget bill to such a decree that President Cristina de Kirchner could fail to accept it.

Argentina's history shows that the lack of a Budget bill was the result of serious institutional issues. The Congress failed to pass Budget bills during the administrations of Arturo Illia, Isabel Perón and Raúl Alfonsín. Meanwhile, the Budget bill introduced during the administration of Fernando de la Rúa was eventually passed in 2002. Hence, the historical backgrounds on this matter are unfortunate.  

In spite of this, Deputy Agustín Rossi yesterday said the 2010 Budget bill re-planning wouldn't be a problem for the administration of Cristina Fernández de Kirchner. According to the current legislation, the government is entitled to continue running the country without a proper federal budget. However, extraordinary public expenditures are not allowed.



Economic impact

Almost every draft bill promoted by the opposition is to have an impact on the federal budget. The pensioners' reform bill increasing pensions to 82 percent of the minimum wage; the allocation of ATN Treasury funds or the transfer of Central Bank profits to the federal administration are to be decided within the framework of the Budget bill debate. And the government will definitely not accept any of the above-mentioned initiatives.

Regarding the inflation rate, Proyecto Sur Deputy Claudio Lozano yesterday said the Budget bill "is not likely to be passed if the government fails to submit a realistic estimate."

Lozano reminded Economy Minister Amado Boudo that the Lower House of Congress had urged the latter to submit an additional draft-bill so as to update the 2010 Budget bill to the current economic and financial situation in Argentina. As a matte of fact, extra incomes worth ARG$75 billion are estimated for 2010.

"If the Budget bill does not correspond with the economic reality, it will be very difficult for the Congress to approve it," Lozano added.

Hence, the opposition is not willing to accept the inflationary estimates elaborated by INDEC Statistics Bureau. According to the official data, the accumulated inflation reaches 6.7 percent so far in 2010, whereas the reports unveiled by private consulting firms actually double the estimation.

The government seems to be ready to face an adverse majority in the Lower House of Congress, which could eventually hamper the Budget bill passing and force President Cristina Fernández de Kirchner to veto it.

The Budget draft-bill submitted two months ago seems to be a set of federal plans implemented in 2010 to be continued in 2011.

Also, the controversial Article No. 79 -which was approved before the Congress reshuffle resulting from the midterm elections held last year- is to be debated. Due to this early passing, the Kirchnerite sector managed to include a controversial reform to Article No. 42 within the framework of the Financial Administration Act.

"Those unearned and accrued expenses as of December 31 are to be included in the next fiscal year," the Article stated.

"Those unearned and accrued expenses as of December 31 may be paid during the following year under the available cash and existing bank by that date," it added.


"The above-mentioned expenditures may also be paid from the resources obtained in the following fiscal year," it said.

The opposition will certainly question the wording of this Article in relation to the funds management, as well as those articles included into the Permanent Supplementary Budget Act, which allowed the government to manage funds allocation in key areas.


Translated by Jimena Gibert