Real primary spending in Argentina fell by 5.8 percent last month as against the previous month, according to a report by Analytica consultancy firm.
Last year’s spending at constant prices was cut by an accumulated 26.8 percent. Transfers to the provinces were the hardest hit by the austerity with a 68.5 percent cut last month as against the previous December or an accumulated 75.1 percent, explained by reductions in the transfers for both current (minus 68.6 percent) and capital (minus 94.3 percent) spending.
Within the transfers for current spending, the only district to benefit was Buenos Aires City (CABA), which received 32 percent more funds than in 2023. This increase is explained by the transfers in compliance with Supreme Court injunction 1864/2022 regarding the federal revenue-sharing arrears owed CABA, which represented 73 percent of the funds remitted to this city.
Excluding this component and the transfers under Law 27.606, this item was reduced by an inter-annual 34.8 percent.
Other items suffering important cuts were economic subsidies (minus 61 percent inter-annually in December) and social programmes (minus 47.2 percent inter-annually last month).
Economic subsidies were reduced by 37 percent in real terms throughout the year while social programmes fell 41 percent.
In contrast, some items registered real increases last month. Spending on goods and services rose 58.8 percent, family and child (AUH) by 47.6 percent and pensions by 20.3 percent with the latter the most relevant as representing 47 percent of total primary spending in December.
Despite this increase last month, pensions also experienced an accumulated fall of 12.5 percent, thus explaining around a fifth of the total adjustment of spending.
Public works was another item to suffer a major adjustment last year, being slashed by 76.5 percent.
– TIMES/NA
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