In the midst of the public debate on the growth of the State’s operation, the Autonomous Committee of the Fiscal Rule (CARF) recently issued a concept in which it is denied that the hiring through orders for the provision of services (PAHO) be out of control and on the contrary it is said that it is within the historical ranges.
According to its most recent analysis, the expense projected in this area by 2025 is even below the average registered between 2018 and 2024, both in terms of value and the volume of contracts. In addition, Analysts emphasize that most likely, by law of guarantees, this level will not be exceeded in 2025.
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According to the CARF, the PAHO hiring, which appears through which the State links natural persons for specific tasks without establishing employment relationship, has represented a relatively stable expense in recent years in which, at constant prices of 2025, the annual average spending since 2018 amounts to $ 17.6 billion; While in 2023 and 2024, it was $ 17 billion and $ 17.3 billion, respectively, and in the run of 2025 (until June), $ 14.1 billion have been executed.
The agency clarified that, due to the seasonality of this modalitythe bulk of hiring usually concentrate on the first semester, between 75% and 80% of the total of the year. Therefore, and except an atypical behavior during the remaining months, the final expenditure of 2025 would remain within the average range.
For now, OPS levels in 2025 remain within the average margin.
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At the volume level, the trend also shows a significant decrease; Since while between 2018 and 2024 the annual average was 486,500 contracts, in 2025 394,600 contracts have been registered until June; What translates into a considerable fall against the peaks of previous years, as in 2021, when more than 546,000 contracts were signed.
A flexible model with all the above
Starting from all of the above, the CARF recalls that PAHO hiring has challenges and limits, but is not out of control and although it recognizes that this modality grants flexibility in administrative management, warns that its excessive use can affect fiscal sustainability and the efficiency of the State.
“In the medium -term fiscal framework the total and primary deficits in 2025 would be 7.1% and 2.4% of GDP, respectively. The total deficit would be higher than that of 2024 (6.7% of GDP) and one of the highest in history. The government scenario contemplates lower income per copy 18.7 billion and higher expenses for COP 20.1 billion Report.
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In order to delve into these data and their causes, Portafolio consulted Henry AmorochoProfessor of Public Finance at the University of Rosario, who offered a technical reading of the figures and provided a structural explanation of the factors that have contained the growth of PAHO spending during the current year.
First, Amorocho recalled that 2025 is marked by the validity of the Electoral Guarantees Law, which restricts hiring in the second semester, since this limitation, which seeks to prevent the political use of public resources, acts as a natural brake on the expansion of contractual spending.
For now, OPS levels in 2025 remain within the average margin.
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In addition, the expert emphasized that the Government faces a cash deficit of $ 19 billion, as stated in the 2025-2026 financial plan released on February 7 and that this missing has forced the entities of the central level to moderate its budget execution, including PAHO hiring.
Another critical point indicated by Amorocho was the approval of the general budget of 2025 by decree on December 30, 2024, since the original document contemplated appropriations for $ 523 billion, but only had legal income in force for $ 511 billion, that is, it was approved unbalanced.
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“In the absence of a financing law that will support the $ 12 missing $ 12 billionproject that had to settle in the first half of 2026, but was not presented, the Ministry of Finance was forced to reduce appropriation by decree, ”he said.
This expert on budgetary issues said that “one thing is to say that you want to execute $ 523 billion, but if it really has $ 511 billion, which I hoped to spend more than it could not have done it”, and made it clear that it considers that this dentalization has decisively restricted the dynamics of public spending, including PAHOs.
For now, OPS levels in 2025 remain within the average margin.
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Inflation effects
Amorocho also caught attention to the effect of inflation in the analysis at constant prices and said that although nominal values might seem similar to those of previous years, when the expense in PAHO of 2025 is adjusted by inflation, it presents a real fall. For this reason, Even if the rhythm of execution of previous years would be matched, the expense will look lower in real terms.
In this way, both the arguments of the CARF, and those of the Professor of Public Finance of the Rosary point in the same direction, in which the PAHO hiring is not responsible for the growth of the operation spending in 2025, or in value or in the number of contracts.
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In the words of Professor Amorocho, “this year, despite the fact that it was wanted to be superiorthe conditions for an increase are not given. Most likely, it is maintained around the historical average both in value and in number of contracts ”.
According to the most realistic projections, the total contracts could close the year in a range of between 480,000 and 490,000, very close to the historical average, and the total value executed would be around $ 17.2 billion, a figure also aligned with the average calculated by the CARF.
For now, OPS levels in 2025 remain within the average margin.
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The expert concluded that the tax, legal and operational conditions of 2025 have limited any possibility of expansion of the PAHO expenditure. Not only by the guarantees law and the cash deficit, but also for the definance of the budget and the narrow margin of time to execute resources.
However, although for now an overflow of PAHO expenditure is ruled out, it is necessary to structurally address the use of this figure in the public sector, since the hiring for provision of services has been useful for supplying gaps of personnel and responding with agility to specific needs, but its systematic use for mission tasks poses problems of labor precariousness, opacity and lack of continuity in public management.
Daniel Hernández Naranjo
Portfolio journalist
