And boy do they pay. The Federal Government, for example, only during 2020 paid 1,296 million pesos (mdp) of Chapter 1000 — the key used to account for the expense in the so-called “Personal Services” -. From your payroll. And is that a lot? Yes. It is 30% of the Programmable Spending accrued from last year, and almost 22% of the Total Net Spending. That is to say, of the three pesos that the Federal Government spends, one is to be paid … its payroll.
If we talk about the states, what can I tell you? Well, yes, I will tell you.
In 2020, also, the 32 states (the 31 states plus the CDMX) paid 566 million pesos from Chapter 1000. This amount was 25% of their Total Expenditure. More or less like the Federation, although this amount is only counting to Chapter 1000. But not all payrolls are there. There are other payrolls in other Spending Chapters. And no, it’s not that they are secret. It is that in the classification of government accounting they have to go in other chapters.
You know, Mexico is a payroll country. And they are everywhere.
So, in addition to 1000, we have — at least — payrolls in two more chapters. On the one hand, in 3000, “General Services”, through which external services are paid, among others, such as electricity, telephone, cleaning or security. And of course, part of those services include payroll. For example, those of companies that hired people to clean public buildings, (unofficial) security guards, or IT.
The Government pays these companies their invoices from this chapter and thus, indirectly, pays the payroll of these personnel. On the other hand, in 4000, “Transfers, Allowances, Subsidies and Other Aids”, as much or more payroll is paid than in Chapter 1000. Why? Because these transfers include resources to pay the personnel of the other Powers of the State — the State Congress and the Judicial Power—, of the Public Universities, and of the rest of the Decentralized Public Organizations — Chapter 1000 of those organizations.
If we add these two Chapters to 1000, we have that the 566 million pesos paid in 2020 became more than 1.5 billion pesos! Take it now. This figure was 66% of the total expenditure of the 32 states! To give it dimension, the total investment expenditure of the 32 entities last year was 113,000 million pesos. That is, of every 100 pesos they spent, in total in 2020, less than 5 pesos were for productive public investment and 66 pesos were for … payroll.
I tell you, a country of payroll.
But, as in everything, the fun is in the details. Who’s who on Mexico’s state payrolls? That is a good question. I also tell you, with two samples: the State of Mexico and Guerrero.