Mandatory spending absorbs more and more resources from the budget due to the drop in revenue and the increase in spending reduced fiscal space by 57% compared to 2023, CIEP reported in its analysis of the 2024 Economic Package.
“At least four spending items must be urgently reviewed to expand fiscal space (pensions and Pemex) and to improve people’s well-being (financing for health and care). The increase in spending for 2024 lacks a medium-term vision, does not take into account the shortcomings of youth and children, and does not have an intergenerational or gender perspective,” highlighted Judith Méndez, deputy director of Research at the CIEP.
The interest payment for the public debt or financial cost continues to be higher than what is proposed for health or education, that calls our attention a lot, says the analysis.
“What we see is a historic expenditure of more than 9 billion pesos, an increase of 4.3% compared to what was approved for this year. It draws a lot of attention to us by making the difference between the type of spending that we already have committed, and the types of spending that we can still manipulate and modify a little to make public policies, now what we see is that 80% of the budget is committed,” he highlighted. Macias.
He added that the growth of public debt is related to the fact that tax revenues are static, and it is not clear how to increase them without a tax reform.
“Basically the increases are being in pensions that grows 12%, against health that rises 6%,” said the director of the CIEP.