As discounted in the market, the Autonomous Committee of Fiscal Rule did not give its support to the accounts with which the Ministry of Finance Sustains that it fulfilled the fiscal rule in 2024, while that debt levels reached 60% and the deficit was the third highest in the last 120 years.
In a pronouncement published through social networks, this committee, whose pronouncements are not binding but heard by investors, reaffirmed that Gustavo Petro’s government spent more than what He could last year and retreated considerably in his struggle to clean up the fiscal accounts.
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“In 2024, the fiscal deficit was 6.8% of GDP, significantly higher than that of 2023 (4.3% of GDP), to the one provided for in the medium -term fiscal framework, and close to which the CARF anticipated. The debt amounted to 60% of GDP, reversing the fiscal consolidation process observed between 2021 and 2023, ”they said in the report.
CARF researchers review that they were transactions Unique time (TUV) those that allowed the fiscal rule to be fulfilled, after their approval in the Superior Council of Fiscal Policy (CONFIS), although it makes it clear that it does not share the arguments that were used to justify this inclusion of some items of the public spending.
President Gustavo Petro
EFE
“The fiscal rule was fulfilled, as a result of the inclusion of transactions of only time (TUV) for $ 31.9 billion and the measures taken to reduce the expenditure by $ 20.6 billion of the $ 28.4 billion budget cuts Fiscal impact. The tax collection was $ 71.2 billion (4.2% of GDP) lower than the one scheduled in the 2024 general budget, ”they said.
Expenditure of more
If this movement had not been made, the CARF indicated that the structural net primary balance, the relevant for the fulfillment of the fiscal rule, would have been -1.8% of GDP, lower than that allowed by law. In that sense, he warned that after the Confis approved those presented by the Ministry in December 2024, The net primary balance of -0.2% allowed by law was obtained.
“Beyond technical discussions around TUV, their validity will depend on trying to have transitory effects on the tax balance in the next two years. In any case, the high level of the deficit and the debt present the fragile situation of the public finances of the national government, and maintains the pressure on interest rates and inflation, ”they warned.
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Said in a simple way, from another perspective, in 2024 the government spent $ 39.3 billion More than expected, according to the increase in the fiscal deficit, since while in 2023 the deficit was 4.3% of GDP, by 2024 rose to 6.8%, which represents an increase of 2.5 percentage points, That if they are calculated on the current value of the current GDP ($ 1,572 billion), leave the aforementioned UA figure.
From the CARF they closed indicating that “the materialization of the lowest tax collection in 2024 has persistent fiscal implications, by 2025 and from now on”, and asking for caution in the management of public finances, since the payment of interests provided for in the financial plan implies that 1 in 3 pesos of tax collection must be used to pay the debt, subtracting space for social spending and investment.
Autonomous Fiscal Rule Committee – CARF
Courtesy – API
“All of the above highlights the urgency that the National Government implements structural measures, in terms of income and expenses, aimed at stabilizing Public finances and sustained compliance with the fiscal rule, ”they concluded.
