Tensions in the 2025 Budget in Argentina

The lack of agreement between the ruling party and the dialogue blocks jeopardizes the approval of the 2025 Budget in the Chamber of Deputies. Without consensus, the Government will extend the previous budget. Governors are concerned about the distribution of funds and fiscal balance.


Tensions in the 2025 Budget in Argentina

The lack of agreement between the ruling party and the dialogue-oriented blocs could frustrate the passage of the 2025 Budget project in the House of Deputies this week, which La Libertad Avanza planned to pass next Thursday. If consensus is not reached, the Government will extend the 2023 Budget, which was voted on in December 2022 at the request of then-Minister of Economy, Sergio Massa, who later ran for president and lost in the second electoral round.

The dialogue-oriented governors are concerned about this situation as they will depend again on the distribution of discretionary allocations made by the National Government. Two days before the scheduled meeting of the Budget and Finance Committee on Tuesday at 3 PM, the ruling party, the dialogue-oriented blocs of UCR, PRO, Federal Innovation, and Federal Meeting, as well as the governors of JXC and provincial governors, maintain disagreements over the expenditure and revenue law.

The president of the Budget and Finance Committee, José Luis Espert, announced that the ruling would be postponed until Tuesday to allow for some "consensuses" to be reached. The discussion of the 2025 Budget had been stagnant for three weeks and resumed after the failure of the session to repeal Decree 846/2024, which is key for the National Government.

Parliamentary sources indicate that negotiations are stalled because the Government rejects the five points requested by the governors, related to increasing funds for federal co-participation and other compensations. The dialogue-oriented blocs want to establish what will happen with the surpluses of the revenue in case it exceeds the expected inflation and increase resources for National Universities, among other points.

If an agreement is reached, the ruling party could have a majority ruling on Tuesday, supported by several blocs, but differences still persist on key points such as pension mobility and allocations. If the disagreement persists, scenarios arise where opposition blocs could request new sessions to address various issues, such as the DNU law and debt swap.