Expenditure on pensions eats up fiscal space: CIEP

The increase in spending on pensions, which occurs every year, eats away at the already reduced fiscal space that the country has to exercise public policies and address other needs and rights of the population, such as education and health, said Alejandra Macías, researcher at the Center for Economic and Budgetary Research (CIEP).

During the second day of Open Parliament, convened by the Budget and Public Account Committee of the Chamber of Deputies, Alejandra Macías explained that there are unavoidable expenses, that is, that they are committed and that they increase year after year in an inertial way, such as the one destined to pensions, debt payments, as well as transfers to productive State entities and companies.

“These expenses increase year after year and leave us an increasingly smaller space to be able to make more innovative and better public policies. In 2016, the fiscal space was 6.4% of GDP, while with what was proposed in the Federal Expenditure Budget Project (PPEF) it is expected to be 2.1%, ”he told legislators.

Next year, the government proposes a pension expenditure of 1.4 trillion pesos, 13.2% more than last year and with which one out of every five pesos of the budget for 2022 would go to pay this item.

“Why is it worrying that it is increasing? We all understand that it is a right to receive payment of a pension, as well as to have the right of access to quality education and health. The greatest increase in pensions is in those that are more onerous, those that belong to the past scheme, before the reforms, “he said.

Welfare pensions

Another important increase is in the Welfare Pensions for the Elderly, which grew 70% compared to last year, which although it is an appropriate policy for this sector of the population, there is no associated source of financing and they are other important items in the budget at risk.

Angélica Ivonne Cisneros, a morenista, argued that the resources destined for the pensions of the elderly pay for the well-being of the families, and pointed out that it is necessary to discuss “how to conceptualize the pension budget”.

The deputy added that the PPEF that was delivered by the Executive “is a sign of the commitment that our government has with social security.”

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