MINISTERS FOR THE PRESIDENCY AND PLANNING STRESS THE IMPORTANCE OF THE PUBLIC EMPLOYMENT PROJECT FOR REACHING AGREEMENT WITH THE IMF

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At a meeting held today, the Minister of the Presidency, Geanina Dinarte, and the Minister of National Planning and Economic Policy, Pilar Garrido, spoke with the heads of faction of the Legislative Assembly about the legislative priorities for the coming weeks and the need to build a joint agenda to tackle the fiscal impact caused by the pandemic.



As part of the meeting, Dinarte and Garrido shared with the heads of faction and independent deputies the route of the process of negotiations with the International Monetary Fund (IMF), which will begin next Monday, in search of the macroeconomic stability of the country and the financing needs that the next government will have.

In this regard, they reviewed the bills already submitted and their impact on reducing the fiscal deficit.

BillYields
2021202220232024
Public employment0,28%0,54%0,81%0,81%
Political debt relief (already approved)0,09%0,01%
Lottery prizes0,09%0,09%0,09%0,09%
Proyecto de ley de exoneraciones (expediente 22365)0,58%0,60%0,61%0,59%


The ministers were emphatic about the need to make adjustments to the public employment bill to achieve the required performance of 0.81% of GDP in Central Government, as the current version of the bill generates an initial increase in public spending of up to ₡32 billion.

“We are confident that adjustments will be made to the project, so that public employment reform will enable us to contain one of the major spending triggers and be one of the pillars of the IMF agreement,” said Garrido.

For her part, the Minister of the Presidency indicated that as part of the fiscal consolidation route, the following draft laws will be presented in the coming weeks:

  • Global Income Bill
  • Bill to create a 0.5% tax on luxury homes worth more than ₡200 million – would replace the current one – which would raise up to 0.17% of GDP.
  • Project for the economic contribution of state companies in the face of the tax situation.
  • Draft law for the sale of CONAPE’s credit portfolio.
  • Draft law to ensure that pensions above the base salary of a judicial officer 1 (₡450.200) charged to the national budget do not increase as long as public debt is not less than 60% of GDP. This would not affect the IVM pensions of the Costa Rican Social Security Fund (CCSS). The measure would make it possible to contain another of the public expenditure triggers and to extend the scope of the fiscal rule.



Finally, the leaders discussed with the faction leaders the need to build additional alternatives to generate sufficient and progressive income, which would allow the completion of the proposal for the IMF to face the fiscal impact caused by the pandemic.

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