OPC 5 Budget Execution 5 ANALYSIS OF NATIONAL GOVERNMENT BUDGET EXECUTION – YEAR 2020

ANALYSIS OF NATIONAL GOVERNMENT BUDGET EXECUTION – YEAR 2020

January 15, 2021
  • Property income was the only source of current revenues with a positive real variation (126.6% YoY) thanks to the transfer of profits from the Central Bank of Argentina (BCRA) for AR$1.6 trillion. This implied an increase of 7.9 times those received in the previous fiscal year. Without this transfer, total revenues would have fallen 16.7% year on year.
  • Regulatory changes with an impact on the PAIS tax and Wealth tax did not prevent the decline in tax revenues which, due to the recessive context deepened by the pandemic, fell 9.6% YoY in real terms.
  • Social security resources showed a decline of 12.1% YoY and revenues from FGS (Sustainability Guarantee Fund) assets fell by 61.9% YoY.
  • As a result of the outlays to face the health crisis triggered by the outbreak of COVID-19 and the increase in economic subsidies, primary expenditures increased by 17.1% during 2020.
  • The set of measures related to the COVID-19 crisis led to an accrued expenditure of approximately AR$917.8 billion, without which primary expenditure would have shown a slight expansion of 0.2% YoY in real terms.
  • Personnel expenditures were reduced by 8.9%, thus completing five consecutive years of real decline.
  • This mixed performance between resources and expenditures produced a net primary deficit of 7.4% of GDP in 2020, a significant deterioration compared to the deficit of 0.7% recorded in 2019.
  • Financial deficit grew from 5% of GDP in 2019 to 9.7% in 2020. The relative decline in debt interest payments was insufficient to narrow the gap between total revenues and expenditures.
  • Current appropriation in 2020 amounted to $7.76 trillion, which means that it increased by 59.7% in relation to the initial appropriation. Social benefits concentrated 61% of that total.
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