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Make the fiscal rule more flexible for primary care institutions in the emergency COVID-19

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The institutions that take care of the COVID-19 emergency on the front line will be able to make their current spending more flexible to cover the additional demand for resources required to face the crisis. These institutions, therefore, will be excluded from the application of the fiscal rule.

On Tuesday afternoon, the Government sent a letter to the president of the Legislative Assembly, Carlos Ricardo Benavides, to inform him of the application of one of the exception clauses to the application of the fiscal rule in certain institutions.

Finance Minister Rodrigo A. Chaves said that “the crisis caused by COVID-19 is serious because it simultaneously impacts the health of people, society and the economy. For this reason, in order to attend to the most vulnerable people, the Government, as established by law, makes the fiscal rule more flexible only for institutions that are on the front line of care.

He added that “our commitment to citizens implies actions to alleviate the emergency, within the framework of responsibility for the future of our fiscal sustainability”

According to the National Commission for Risk Prevention and Emergency Care (CNE), in the first stage of emergency care by COVID-19, the current expenditure of primary care institutions will be ₡ 227,509 million, which represents 0, 6% of GDP.

As established by Law 9635 and its regulations, the CNE must identify these entities and justify the expenditures for compliance with emergency care, with the aim of making the growth of current spending more flexible according to the participation of each entity.

The CNE has indicated that the investment in spending to deal with COVID-19 will be made by the following institutions:

Ministry of Labor and Social Security, which will develop payment of subsidies for labor vulnerability to people who have lost their job or have had their working hours reduced.

Mixed Institute of Social Aid, which will execute the payment of emergency subsidies to SINERUBE beneficiaries.

Costa Rican Institute of Research and Teaching in Nutrition and Health, for investment in reagents and laboratory equipment.

Benemérito Fire Department, to strengthen its operation during the emergency.

“The lifting of the rule is a measure that, in the face of the COVID-19 outbreak, aims to provide resources to address the needs of the most vulnerable people as a priority and to promote economic recovery as soon as possible and within a framework of macroeconomic responsibility, ”said María del Pilar Garrido Gonzalo, Minister of National Planning and Economic Policy and Coordinator of the Government’s Economic Team.

In addition, and with the aim of safeguarding the stability of public finances, the Executive Power is promoting a series of bills that allow financing the bulk of these resources, so that the impact on the increase in debt is as little as possible.

These initiatives include cutting spending by the Central Government and autonomous institutions for ₡ 100,000 million; bill that would allow the National Insurance Institute to transfer ₡ 75,000 million for emergency care and the bill to take advantage of the differential in fuel prices to finance emergency care.

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