Are we jeopardizing the future of our children by letting current gov waste OUR money?!

An excellent analysis by Jose Luis Parada, shared by Humberto Vacaflor:


An excellent job of Lic. Jose Luis Parada

GENERAL BUDGET OF THE STATE: What to expect to happen with $95,090 MILLION

Jose Luis ParadaAccording to official data submitted by the Executive branch through the Ministry of economy and finance to the Multinational Assembly [former Congress], in the last seven years (2006-2012), the General State budget planned income and expenditure of Bs.665,633 million, equivalent to $95,090 million dollars.

This amount represents the expenditure of 25 years of previous Governments, i.e. has a 4 to 5 times more income, and the logical question is: did it benefited the Bolivian population with four times more health, four times more education, four times more public safety, four times more production of energy and hydrocarbons?, and the Bolivian people has the answer.

Advertising for the Government in recent years, based on these data, shows a large amount of money in the economy and generated expectations over their rights [of use of those funding] in different sectors at the moment they start to claim them and one of the themes is the revision of the pensions’ law, which at the time was a political flag, when experts observed the same sustainability.

Unfortunately to date there is no official report on budget execution, the format of presentation of the General Budget of the State to the Multinational Assembly and partial and sectoral information, often distorts the control and evaluation of the expenditure.

Enrolled in the PGE 2004, revenues reached the sum of Bs.33,677 million and by the creation of the direct tax on hydrocarbons, the hydrocarbons law, and the rise of barrel of oil prices at the international level, one of the positive factors, from 2005 showed a sustained revenue growth of nearly 60% in 2008, with an amount of Bs.80,554 million

The Bs.111,449 million sum  was reached in 2010 and by 2012 went up to Bs.145,943 programmed million, showing between 2005 and 2012 a revenue that grew four times and the Government should have the resources to generate investment projects that help improve the standard of living of Bolivians and reducing extreme poverty which is still high in the country.

This amount of scheduled money has not been present in all the years of independent life of Bolivia and is due mostly to an exceptional period of high prices of raw materials and not to the reflection of State policy applied in the public finances, [what was needed to] support this revenue rise [would be] ensure its sustainability over the medium-term.

As revenues climbed rapidly, in different public institutions [the expenses] increased in the same proportion, especially in the Central Government, since [they] also began to create several strategic public companies of which [very little is] known of their detailed expenses, as well as new ministries, thus increasing the State bureaucracy.

The economic and financial regime applied by the Government in the last seven years, is more radical to the one applied by the so-called neo-liberal governments and their measures of confiscation of resources to [the nine] Departments and the discretionary distribution of public spending, has created an imbalance between the autonomous territorial entities (universities, municipalities and governorates) and as an example of this “over-centralization” of funds. Note that in the General State Budget the Central Government manages and spends 88 percent of planned revenues and only 12% are distributed to 360 autonomous institutions.

That is why the greater responsibility in the implementation of financial resources lies especially in the Central Government and the absence of control, both by the Multinational Assembly and the General Comptroller of the State, and there are very few people who know the destination and use of $95,900 million dollar and would be appropriate, to have a transparent and honest budget information.

It is not known if the budgeted amounts are real or only reflected in the official document presented to the Multinational Assembly and the reality is different when revising the effective execution, especially in those strategic public enterprises and ministries, that manage the largest number of funds registered in the PGE.

This fiscal maze, the publicly so-called economic boom, in seven years generated expectation rights in the Bolivian population, who naturally increased the sectoral demands, as it is the case of the miners, medical, manufacturing, etc., basically centralized in the law of pensions and percentages of retirement, the discrimination between citizens, of first and second-class citizens.

It is good to know that these public policies involved, including the private formal sector, only 35% to 40% of the economy, since the informality, which directly reaches 60% to 65% of the national economy and does not know or know what contribution or benefits should get from the solidarity fund, [population in general] is also affected directly and indirectly by the blockades and social demands.

This situation shows the crisis that we are experiencing and which by the waste of resources by the Central Government, [there is] excess advertising and distortion of reality, which is creating demands for greater effective solutions over the short-term and not pursue this career of demagogic promises that do not lead to good port and the only thing that makes is to postpone the problems of different social sectors. [thus generating riots and escalated violence: anarchy at its best]


As you can see the programmed expenditure reaches to $95,090 million dollars and capital (investment) expenditures reach a 17.4%, while approximately 82.6% is allocated to current expenditure, salaries, wages, operating expenses. [which is how ultimately the electoral campaign for the illegal re-re-election ends up using those funds, indirectly or indirectly…]

Interesting to note that despite having four times more money programmed, the interests of scheduled domestic debt amounted to Bs.16,088 million, which demonstrates a discretionary management of resources and leaves doubts about the efficiency and effectiveness of public expenditure, whereas regular rates of economic growth, which are similar to the efforts of Government passed.

With this frame of reference, the sole liability and the major economic and social demands is the Central Government [which] should prioritize actions and negotiate and transparent budgetary figures and prove that their rejection or acceptance has enough viability and livelihoods and not be with political speeches which in no way produce benefit to the country.

Crystal clear exposition of how badly the Bolivian revenues are handled, excessive useless bureaucracy, anarchy and less tolerance invades our streets and country side. This analysis alone should serve Bolivians to cease the support over current government. It is time to change leadership, it is time to make the 2014 election count!

Published by Bolivian Thoughts

Senior managerial experience on sustainable development projects.

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