Puerto Rico needs the approval of a government budget that responds to citizen needs and clearly establishes the fiscal priorities to achieve the recovery of public finances and reconstruction after hurricane Maria. Failing to do so exposes the island to a setback with negative consequences for all.
Last night, there were reports on the legislative intention to approve a $ 8.709 billion budget, which reduces by $ 40 million the version proposed by the Board. The action in the Senate emerged as a move to prevail over the fiscal entity. Today, it is necessary to know the details of such adjustments.
This belated action could have been taken before, without the pressure of deadlines for the approval of such a crucial legislation, and shows that the bill for the repeal of Law 80 was used as a political diversion to avoid considering adjustments in items whose calm consideration could have been on track weeks ago.
Faced with the inability of legislators to approve a budget roadmap consistent with the agreements reached between the Executive Branch and the Oversight Board, the agency announced a public hearing to evaluate the government's budget today. They were seeking to evaluate and possibly certify its own version of the budget for fiscal year 2018-2019, which begins on Monday.
The postponement of the hearing offers the government a brief opportunity to work with the entity on a budget project aligned with the certified fiscal plan and in compliance with PROMESA Law. The federal statute grants them until June 30 for the Board to certify the document.
The Legislature must take advantage of this situation to avoid new frictions. So far, what has prevailed in the run-up to the new budget is an unfortunate political incompetence to adopt key consensus seeking to get the island out of a stagnation that has lasted more than a decade. The adversarial process developed in the Legislature regarding Law 80 ruined the possibilities of understanding between the Executive, the Legislative branch and the Board.
The unfortunate political disagreement and the uncompromising position of the Senate derailed the agreement reached between the Executive Branch and the Board regarding this statute, as a condition to maintain vacation and sick leave, as well as the Christmas bonus during the validity of the fiscal plan. Faced with an impasse, there are no guarantees that these benefits will be maintained, if the Board presents its version of the budget.
Those leaders who hold the reins of the island must seek agreements that allow a realistic budget to be presented in Congress as a sign that the government is on track to stabilize the public finances. The island would have that opportunity in July, when the House Committee on Energy and Natural Resources holds public hearings on PROMESA.
In the scenario of imperative needs of the island there is no room for obstructionism.
The distribution of government resources is the cornerstone of the five-year fiscal plan already certified by the Board. The document contemplates important structural reforms. One of them, the transformation of the energy model, is already a law, but the approval of others equally important to make Puerto Rico competitive, like the Incentive Code, have been held hostage to challenging attitudes that have undermined the dialogue.
The governor's proposal has been the step that gets the government spending program the closer to the priorities set in the certified fiscal plan, at risk of being reverted.
Instead of building bridges to understanding, the House and Senate approved versions with different expenditure distributions in the proposed budget, which amounts to $ 8.782 billion and is $ 33 million higher than the one recommended by the Board.
What is important for the island is that the budget reflects fiscal discipline, willingness to comply with obligations and responsible programming of repair initiatives for the infrastructure devastated by Hurricane Maria. These roads, when taken with responsibility, are the foundations for the revitalization of the productive activity that will generate jobs and new capital.
In the short term, a well-articulated proposal is urgently needed to recover unity of purpose and seek, free of further political distractions, the welfare of the island.
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