In the last session of the Plenary Session of Congress, it was approved that retired teachers and ceasers of the Masterial Public career receive s/3,300 pension, something that although it seems fair, it is also a populist measure that will affect the treasury. Carlos Prieto, manager of Economic Studies of the BCP, warned of the impact of this measure in case the Executive approves it.
“That is a clear example of populism and fiscal irresponsibility, threatening the balance of the pension system itself. In addition, the Congress has no spending initiative, so we hope that the Executive will observe the norm and in any case use the Constitutional Court,” he said.
In that sense, he warned that the fiscal impact of such a measure is approximately 5,000 million, a amount that would have to be discounted from the investment that is made in “infrastructure or other activities.”
In addition, he recalled that the Fiscal Council has recommended that the proliferation of laws increase public spending and grant tax benefits.
Similarly, he questioned the increase in resources for remuneration. It should be noted that next year’s budget has been contemplated S/93,538 million for public sector salaries, which means 12% if compared to what is assigned for 2025 and 65% in relation to 2023.
“It seems that the country’s priorities are still in increased remuneration,” he said and questioned that there is no improvement in security, education, among others.
Upward debt
The BCP representative indicated that Peruvian public debt grew more than 10 percentage points in a decade, from 20% of the internal gross product (GDP) in 2014, to 32% in 2024.
“It continues to be one of our main macroeconomic strengths, but we must not lose aside the trend. More than 10 points of increase. If we see the net public debt, which is the difference between public debt and our savings, we see that we have been consuming our savings, so this indicator increases 20 points,” he added.
The expert warned that interest payment has also increased from 1.1% of GDP to 1.7%. This, he said, means lower resources for sectors such as infrastructure, health, education and security. What has decreased are tax revenues from 22% to 19%.
“This analysis of the last 10 years allows us to observe that there has been a deterioration of public finances. We have an increase of just over 40% of public sector remuneration and salaries,” he added.
Best projections
But since not everything is bad news, Carlos Prieto reported that the BCP upset its growth projection for next year, from 2.8% to 3%. By 2025 it does keep it at 3.2%.
This modification responds to the best performance of private consumption, as well as controlled inflation and exchange terms in historical maximums. For the exchange rate, they estimate that closing in S/3.65 this year.
TAKE INTO ACCOUNT
- The BCP estimates that private investment grows 7% this year, and 4.5% in 2026.
- In addition, it fell its inflation projection by 2025 from 2% to 1.8%.
- As for the reference rate of the BCR, it plans to close this year at 4.25%.
