National Budget for 2022, with $12.5 trillion unexecuted

In the next few days the Congress of the republic will discuss the budget addition project for 2023, which was filed last week by the Treasuryand with this the resources available for the current term would rise to $414.2 billion.

In parallel to this, this week the Ministry published the execution report of the General Budget of the Nation accumulated to December 2022, according to which, in the term of last year, resources for $352.7 trillion were appropriated.

Of this amount, 96.5% was committed, that is, $340.2 billion, while 88.4% ($311.8 billion) was obligated and 88.2% ($310.9 billion) was paid. Uncommitted appropriations at the end of the term amounted to $12.5 trillion.

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In the conformation of the General Budget, it is worth mentioning that the appropriations correspond to the maximum spending authorizations approved by Congress, and that must be executed, or committed, during the respective fiscal period.

The assignments are the acquired commitments that must be developed in the fiscal period, while the obligations are the amount owed for it and the payments are the disbursements corresponding to the resources that are contracted with the budget.

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Portafolio consulted with the Ministry of Finance, which clarified that “The budget is an authorization of spending given by law to use it in the respective validity. Once the year is over, that spending authorization is lost. Therefore, those uncommitted values ​​disappear, i.e. the given authorization was not used.”.

In simple terms, the general budget estimates a series of resources and makes plans for a certain term, but without precise certainty of how much will be received in terms of income or how much will be spent.

According to José Ignacio López, director of economic research at Corficolombiana, if the resources are not executed, they cannot be spent unless there is reappropriation.

“Under-execution ends in less spending and a smaller deficit. Given the sources of financing, the lower execution should be reflected in a greater availability of resources in the Ministry’s accounts, which would be the final availability in the Financial Plan.”, he explained.

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The report details that, through Law 2159 of 2021, an amount of $350.4 billion was initially approved for 2022, which increased by $2.3 billion. Of the total of $352.6 billion, 94.6% of the expenditure corresponded to the Nation’s resources, and the remaining 5.4% to the resources of public establishments, according to the report.

According to the report, in 2022 the budget lag constituted at the end of the 2021 term ($23.2 trillion) was also in execution. “These are committed and obligatory allocations, constituted as budget reserves and accounts payable at the end of the 2021 term, which must complete their budget cycle and therefore be paid in 2022.”, indicates the report.

According to the Treasury, at the end of the term, 97.6% of the 2021 budget lag was paid, since the payments made at the end of December totaled $22.6 billion.

Of the total resources in 2022, 59.9% of the General Budget ($211.3 billion) were operating expenses; 19.8% of the total ($69.6 trillion) corresponds to investment resources, and $71.6 trillion, equivalent to 20.3%, corresponded to debt service.

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According to the budget execution report, in 2022 around
82% of government spending without debt was allocated to seven of the thirty sectors that make up the Budget: PGN: Education with $49.7 trillion (19%); Health and Social Protection with $41.8 billion (16%); Defense and Police with $39.5 billion (15%); I work with $32.8 billion (13%); Treasury with $17.9 billion (7%); Social Inclusion and Reconciliation with $20.2 billion (8%); Transportation with $9.0 trillion (3%). 19% of the nation’s spending without debt ($48.5 trillion) was allocated among the 23 remaining sectors that make up the PGN.

LAURA LUCIA BECERRA ELEJALDE
Journalist Portfolio
Twitter: @LauraB_Elejalde