Government Has No Money To Pay Salaries and
Pensions, Says Hacienda
The Ministerio de Hacienda (Finance
Ministry) confirms that it doesn't have the
money to pay the aguinaldo (Christmas bonus)
that is due in December, nor salaries of
public employees and payments of the "pensiones del régimen
no contributivo" (non-contributory pension),
The situation affects some 110.000 public
sector workers and 58.000 pensioners.
The ministra de Hacienda, Jenny Phillips,
who recently took over the portfolio
confirms that the government coffers are
empty and needs a cash injection to make
good on its obligations.
The problem stems from a "financial hole" of
¢515 billion colones detected by the Contraloría General de la República
(Comptroller's office) during a
financial check of the first quarter
figures, which was caused by a decrease in
tax revenue as a result of a slump in the
economy due to the world economic crisis.
Ministra Phillips assures that her officials
informed the Poder Ejecutivo (the
administrative branch of the government) of
the problem and confirms that it will need a
loan of ¢414 billion colones to meet its
obligation.
But, there is a catch. The government, by
law "Ley de Presupuestos Nacionales"
prohibits the government to get into debt to
pay for current expenses, which alaries,
bonuses and pension payments are deemed.
The only way to crawl out of this hole is to
ask legislators to change the law. But,
December is around the corner, and that is
no easy task under normal circumstances.
According to Phillips, Hacienda will be
looking for approval of a draft budget to
allow it to finance the shortfall.
It is not kwon if the there is a "Plan B" as
the ministra has refused to many any public
statement.
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