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Marco Pérez Valtier: Hacienda was prepared with a better "saved" by 2021

Marco Pérez ValtierMarco Pérez Valtier Source: Félix Vásquez

If we check the General Law of Public Debt, What we find is that this Law defines what is “understood” by Public Debt (Liability obligations derived from financing) and although later it defines what is understood by “financing”, It fails to define concepts as Gross Debt and Net Debt.

On the other hand, this Law indicates that the Congress of the Union will authorize the amounts of NET indebtedness (internal and external) that is necessary for financing the Expenditure Budget of the Federation, as well as the Federal District, today Mexico City, but it fails to define what is understood by “Net Debt”.

It is in the Federal Budget and Fiscal Responsibility Law, where this concept of “NET Indebtedness” is defined, which, to the letter states:

Net Debt: the difference between the drawdowns and repayments made of the obligations constituting public debt, at the close of the fiscal year.

Likewise, it is in the Article two of the Income Law of the Federation, Where the authorization of Congress is reflected so that the budgetary public sector can contract more NETA debt, and even the amount authorized for each entity, both internal and external, is detailed.

In fact, that same article indicates that it could contract more debt than authorized there, as long as it is used to pay liabilities (amortizations) since this leaves the total net debt unchanged.

This is relevant, because in the reports on the evolution of the Federal Public Sector Finances and Debt, both monthly and quarterly, data on the GROSS debt and NET debt, but in the latter case, of the NETA debt, the concept handled does NOT correspond to the one defined in the aforementioned Budget Law.

Traditionally, (since before the new administration) the concept of “Net” Debt that is included in the public finance reports, defined Net Debt as “net” of financial availabilities, that is, balances were subtracted in the checkbook of the TESORERY of the Federation, and not net of amortizations, as defined by the Law.

At least that was what the reports themselves recorded in their footnotes, but recently, it seems that the SHCP itself has already “redefined” this concept, since now the following legend can be read in these footnotes:

“The concept of Net Debt is obtained by discounting from the Balance of the Gross Debt the financial assets of the Federal Government ”.

In other words, with this new “definition” of NET Debt, now they could subtract NOT ONLY the availabilities of the checkbook resources, but the balances of any financial investment, even if it is not liquid.

Why are our authorities doing this? Undoubtedly, the authorization made by the Congress of the Union, where it limits the maximum amounts of NET indebtedness, can easily be circumvented, if more new debt is contracted, but it is not spent and is left in the checkbook or in financial investments, arguing that “net” debt (as they define it) has not been exceeded, although “gross” debt has.

This is interesting, because it allows you to do a Money “saved” that they can very well spend in the following fiscal year, and even better, without any expense label, since the “availabilities” in cash that remain at the end of the year in the Federation Treasury, They are NOT part of the Income Law the following year, which is made as if the box were left in “zeros” which is never true.

It is suggested that the Superior Audit of the Federation pay attention to these methodological practices and check if they are really being respecting debt limits net approved by Congress.

On the other hand, the Income Law of the Federation must include, within the Income of each year, these availabilities of resources at the end of the previous year, such as “Edefas”, that is, surpluses from previous fiscal years, (as stated does in the State of Nuevo León) and proceed to be labeled for spending purposes in the Expenditure Budget of the Federation.

As informative data, as of November 2020, the latest official data published, the gross debt of the budgetary public sector had increased by 1,217.0 billion pesos, (1.2 Billion pesos more) while the net debt increased by 735.3 thousand of millions of pesos, that is, the financial availabilities totaled a whopping 882.3 billion pesos, yes, as you read it, EIGHT HUNDRED AND EIGHTY TWO BILLION PESOS in the “little pig”.

Another informative data, at the end of the previous year (2019) that “little pig”Of resources of contracted debt NOT spent, was $ 400.6 billion pesos, so that until last November, they had increased it by $ 482 billion pesos more, a growth of 120 percent.

Very interesting, right?

This is an opinion column. The expressions used here are the sole responsibility of the person signing them and do not necessarily reflect the editorial position of El Financiero.