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34% of the 2023 budget would go to subnational governments

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The Executive Power proposes that the Institutional Opening Budget (PIA) for fiscal year 2023 amount to S/ 214,800 million, which is equivalent to 21% of the gross domestic product (GDP) and represents an increase of 9% compared to the 2022 PIA The prioritized sectors will be Education and Health.

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However, one peculiarity that the 2023 budget would have is that it would be more decentralized than previous years, since subnational governments will concentrate 34.2% of the total amount proposed (see infographic).

In detail, the regional governments would have items for S/ 42,278 million, 16.4% more than what was assigned for this year. While the resources allocated to local governments will amount to S/ 29,797 million, increasing by 38.1% compared to the PIA 2022.

In this regard, the head of the Ministry of Economy and Finance (MEF), Kurt Burneo, when supporting the project before the Plenary Session of Congress, said that it seeks to improve the execution of the budget. For this reason, he explained that from January 1, 2023, regional and local governments will have the resources so that they can use it, especially in investment projects.

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Thus, he explained that unlike other budgets, processes will no longer have to be followed so that resources are transferred to subnational governments, but now it will be automatically.

Despite this, several parliamentarians expressed that a larger budget should be allocated to the regions in order to improve their quality of life.

However, Prime Minister Aníbal Torres denied that it is a centralist budget and pointed out that the resources are being balanced.

In addition, the premier recalled that local and regional governments are the ones with the lowest level of execution, which must change.

CAS Continuity Resources

Resources are also allocated in the budget to authorize the extension of the CAS contracts signed within the framework of DU 034-2021 and 083-2021.

In addition, the ban on hiring landlords is suspended for all of 2023. Finally, a budget is included to implement collective bargaining.

Infographic The Republic

Infographic The Republic

Source: Larepublica

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