Higher Fiscal Budget Designated for 2013

The budget for 2013 of the three branches of government and the Supreme Electoral Tribunal grew slightly compared to 2012 due to the high fiscal deficit of the Central Government.

Yesterday, Edgar Ayales, Minister of Finance presented the spending plan for next year, which will amount to ¢ 6.4 trillion (million million), representing a nominal growth of 7.7% over 2012.

However, in real terms (discounting inflation) growth is only 2%.

“We have three months of dialogue with all ministries to see if certainly there is capacity to implement the amounts requested in the budget. So, in the beginning, we will avoid having to fight for money, and a year later to explain why no expense, “said the minister Ayales.

The Treasury chief described as “healthy” the composition of the new budget. He noted that spending will grow less than current income, which would increase by 11.7% compared with 2012.

The budget for next year will be financed by 57% with current income and 43% with debt.

Laura Chinchilla, President of the Republic, described as “difficult” to balance the budget, however, highlighted the options available to the Government for better borrowing conditions.

According to Ayales, the high proportion of debt is the result of a rigid spending and high deficits.

The draft budget for 2013 estimates a financial deficit-spending-revenue greater than 5.26% of gross domestic product (GDP), slightly lower than the deficit of 2012 (5.39%).

With the issue of spending, over 47% will be allocated to the social sector: housing, education and health, among others. This includes compensation (wages and transfers).

By 2013, 3,189 new positions were created, of which the great majority is in the Ministry of Public Education and public safety entities.

The plan of government payments was received with criticism by Manrique Oviedo, deputy Citizen Action Party (PAC), who questioned the use of debt to finance a portion of current spending, violent as the Public Finance Act.

For Fernando Rodriguez, Program Analyst Fiscal Studies National University, it is logical that the Government avail debt, lack of structural reform that will provide more revenue.

However, analysts expect slower growth in spending for 2013

Top