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New Public Employment Law Needed To Reduce Fiscal Deficit

Without a new public employment law, the cost containment measures presented by the Ministra de Hacienda (Minister of Finance) Rocio Aguilar, will not be enough to resolve public finances.

Ministra de Hacienda (Minister of Finance) Rocio Aguilar

Likewise, the business sector insists that the next step is to take measures that change public sector employment, mainly in remunerations and benefits to restrict salaries and perks (pluses in Spanish) but that can only be resolved by the Legislative Assembly.

For their part, legislators are taking a wait and see attitude for the measures to be implemented before tabling tax reforms, both regarding public sector employment and new taxes.

In an interview with La Republica, the minister said to only propose measures to cut expense is not enough. The Minister is clear that it is necessary to have a new law on public employment, as well as to modernize taxes in general.

On the law of public employment, Aguilar said, “not only of wages, but of everything that refers to public employment. Our laws are simply about wages, there has to be a transformation…what are the competencies that are required, what are the processes of updating officials, what will the compensation scheme be, according to the capacity of the country?”.

For the Minister there is also a need to reform the institutional design of the organizations, “We can not live with 330 institutions, that is a luxury that we can no longer afford.
There has to be a fusion of programs and institutions that would improve the quality of spending”.

Source (in Spanish): La República