Given the recent effects of the stormwhich would later become the Hurricane Melissathe question arises of how many resources are budgeted for situations of this type.
The Organic Budget Law 423-06in his Article 33establishes: “The Income Budget Project and Public Expenditure Law will annually record an appropriation intended to cover unforeseen events generated by public calamities that will be equivalent to one percent (1%) of the estimated Current Income of the Central Government.”
Although the Organic Budget Law indicates what was stated in the previous paragraph, the laws of General State Budget do not include 1% of current income. The board shows the budgeted amount from the 2016 until this yearand how much was 1% of budgeted current income.
We limit ourselves to showing the last 10 years, although it is a practice for many years. He budgeted amount has been kept constant: 594.8 million pesos. A figure much lower than that established in the Article 33 of Law 423-06.
According to the legislation, in the 2025 12,432.5 million pesos should have been included. Around 21 times what was budgeted.
The Organic Budget Law contains an article that, if complied with with respect to 1% of current income, would have allowed progress in reducing public debt.
He Article 58 states: “The unused part of the budget appropriation destined to address public calamities, referred to in the Article 33 of this law, must be applied to reduce the net debt of the public sector.”
The Organic Budget Law was well thought out in this regard. He Article 58 It is a method of fiscal consolidation. We could say that, combined, articles 33 and 58 help in that purpose. Resources that would not be executed during the year would reduce public debt. Law 423-06 is well-intentioned, but it does not comply with those two mandates.
He General State Budget (PGE) of each year includes legal mechanisms to budget a smaller amount to whom he orders Article 33. Likewise, the PGE includes a mechanism to be able to comply, in the event of a calamitywith the provisions of the Law 147-02.
According to that law, Risk Managementthere should be a National Prevention FundDisaster Mitigation and Response. That is another fund that lacks the resources to face a calamity either emergency.
The situation in which the country finds itself is one of limitation of specific funds before a disaster occurs. emergency; nor is a mechanism being applied to reduce public debt, as was foreseen with the Article 58 of the Organic Budget Law.
An alternative to the current situation would be the creation of a Fiscal Stability and Sustainability Fund (FESF). In the project of Fiscal Responsibility and Transparency Law prepared by Crees, the sources of income to nourish the FESF.
Likewise, its uses are identified, among which includes the reduction of consolidated public debt, in addition to the stability of public finances at times when unforeseen events or events occur, including attention to crisis situations. calamity public.
And the private ones? Despite the growth in insurance sectorpenetration is low as a percentage of GDP compared to other countries in the region. Among the limitations to the increase in penetration is the tax legislation current. The policies are taxed with a selective consumption tax of 16%.
It’s a distorting tributewhich urges that the families and businesses can use the benefits of insurance as a mechanism to reduce the risks of material losses.
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A collaboration of the Regional Center for Sustainable Economic Strategies (Crees).
