City transport subsidies source of conflict between Javier Milei and Jorge Macri

The same day of the meeting between Luis Caputo and Jorge Macri to move forward with an agreement on the distribution of federal revenue sharing funds, the Transport secretariat sent a leter to the City announcing its intention to no longer subsidise 40 percent of the subsidies for all 31 Buenos Aires City bus lines. On that day, the Mayor left happy thinking he would be paid from 1.4 to 2.95 percent starting on August 1.

However, the government did not send a cent and now added a fresh conflict front with the City by going ahead and removing subsidies, which amount to some 6.5 billion pesos. This would be effective in September.

Today, all 31 bus lines are subsidised by 51 percent by the Buenos Aires City Hall, 40 percent by the government and the remaining 9 percent by the fare. However, the body with the power to regulate the concession, routes and fare policy is the national Transport secretariat.

According to an agreement signed in 2019 between the federal government and City Hall, subsidies would be removed “depending on budgetary possibilities”. Thus, at Buenos Aires City Hall, in addition to state of alarm, they are working on replying that they cannot handle the funds this removal entails.

Could all 31 bus lines move to Buenos Aires City’s jurisdiction? The letter sent by the government does not mention that, but the costs.

In this vein, while he was Economy minister two years ago, Sergio Massa wished to do likewise and a worktable was confirmed. Those who wished to curb he issue were bus companies and unions who were more comfortable with the federal government then.

In this context, sources from the City’s Transport portfolio anticipated to PERFIL that the issue put the Mayor and his collaborators on alert. And they said that today’s transfer would be a serious complication for the City’s coffers.

The hostility between the libertarians and PRO has gone from bad to worse: after the disputes between Mauricio Macri and Santiago Caputo, the President’s preferred advisor, now this comes in addition to noncompliance not only with the Supreme Court’s ruling in September 2022 which ordered an increase of federal funds from 1.4 to 2.95 percent, but the Economy minister’s word on compliance starting in August.

What the Economy Ministry offered were discretionary transfers, but not actually enforcing the ruling with a daily transfer of funds.

Thus, the City should now be filing a complaint before the Supreme Court once again and leave open the possibility of attaching Banco Nación accounts otherwise.

--TIMES/PERFIL