The Government, with an eye on fiscal matters, seeks to reconvert the IFE bond and the ATP

The Government, with an eye on fiscal matters, seeks to reconvert the IFE bond and the ATP

The economic Cabinet met at the Palacio de Hacienda

© Provided by Clarín
The economic Cabinet met at the Palacio de Hacienda

“The fiscal situation is very delicate”, they acknowledge in the Government when 2020 averages and in Congress the draft Budget 2021 is debated, which seeks to reduce the primary fiscal deficit and place it at 4.5% of GDP next year.

With this number on the horizon, insufficient for some sectors that ask for a greater spending adjustment, the Government closely follows the fiscal numbers to embark on a path towards “normalization of public accounts,” as Martin Guzman, after closing this year with a primary fiscal red (before payment of interest on the debt) of around 8%.

On the income side, there is some optimism, but they prefer to exercise caution and redefining the assistance programs that emerged with the pandemic, such as the IFE voucher and the ATP.

After September, the first month in the year in which tax collection grew above inflation, in the Government they hope that October will have a similar performance.

Even with a lower contribution from the Country Tax (which arises from adding 30% to the official dollar) after the strengthening of the stocks announced in mid-September and the impossibility for many who bought the “savings dollar”, other resources are gaining dynamism.

The collection of social security seems to have hit the ground and is beginning to turn around, sources from Casa Rosada said.

This change in trend could show that the unemployment floor (within the formal market) was left behind, although they warn: “You have to be prudent and wait, but the data is showing that.”

Until now, the data that are known from Indec showed that in the second quarter of the year 13% of Argentines were unemployed. But to that percentage are added those who, in the midst of the pandemic, did not even go out to look for work.

The Country Tax, which was implemented through the Law of Social Solidarity and Productive Reactivation approved at the end of 2019, until now implied a relevant contribution in the collection, of about $ 20,000 million per month.

In September it was the first time since the beginning of the quarantine that this tax collected less than the previous month when $ 20,858 million entered, compared to $ 21,900 million in August. So far in 2020, it has contributed about $ 110,470 million to the public coffers.

Even with a lower contribution from this tax, the Government believes that it could be another month that shows a more favorable evolution than the previous months. “We are seeing that in October the collection can grow again in real terms,” ​​added official sources.

While the definition of IFE 4 is still pending, precisely due to the impact on public accounts, in the Government they are working with the bet to leave this program behind and turn it into help that seeks to incorporate people into the labor market or young people to study.

The plan “Empower Work” that depends on Social Development, a ministry headed by Daniel Arroyo, works in this regard.

In fact, the idea of ​​providing a universal basic income in the post-pandemic, a policy promoted worldwide by some countries and also by some organizations such as ECLAC (Economic Commission for Latin America), was evaluated by the Government but set aside before the impossibility of having the resources to put it into practice.

The ATP program, which took place for five months in a row amid the spread of the coronavirus, had as its axis paying part of the salary of the workers of the companies that requested this transfer from the State.

But in the latest versions the possibility of some firms accessing subsidized loans was added. While for some sectors (the hardest hit) direct assistance for the payment of salaries will be maintained (as in the case of tourism, culture and sports), the Government confirmed that the rest of the firms will go towards a scheme in the They will only be able to access the soft loans that are offered.

Get on social plans

The agreed increase in the living and mobile minimum wage of 28% in three sections will imply a rise in the current social plans.

Last week an increase in the SMVM of 28% was agreed in the Ministry of Labor between the business chambers and the unions with a 12% increase in October to $ 18,900, 10% in December to $ 20,587.50 and a remaining 6% in March that will complete the increase to $ 21,600.

Some 600,000 people who receive social plans today will see an increase. The case that the Government intends to gain strength is the “Enhance work”: it involves a half-day (4 hours) workload and the beneficiary receives assistance from the State of an amount equal to half the SMVM, which with the increase of the 28% agreed last week, in March it will be $ 10,800.

See also: State aid for the pandemic already amounts to almost one trillion pesos

See also: According to data from the Industrial Union, formal private employment has already fallen for two years


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