This morning, President Mauricio Macri, Interior Minister Rogelio Frigerio and Cabinet Chief Marcos Peña authorized for AR $850 million to be handed back to the provinces of Santa Cruz, La Rioja, Tucumán and Neuquén. The divested funds are part of federal co-participation, the system by which the State and the provinces divide the total tax revenue between the provinces and national entities. With the exception of Neuquén, these provinces in particular are relevant because they are Kirchnerite provinces that are receiving aid for the first time — something Santa Cruz was in desperate need of as political unrest engulfs the province.
The government divested funds in January of this year to seven other provinces. This time, once again, each province got its own decree stating how much money it will receive — instead of having one general decree with a table or something:
|La Rioja||AR$ 150 million||Decreto 638/2016|
|Neuquén||AR$ 500 million||Decree 636/2016|
|Santa Cruz||AR$ 50 million||Decree 639/2016|
|Tucumán||AR$ 150 million||Decreee 637/2016|
It’s really not that bad. Just some time-consuming table fiddling on WordPress.
In any case, this is the second time that Neuquén has received co-participation funds from the government, bringing their co-participation funds to a total of AR $2 billion.
As a reminder, federal co-participation are handed to the provinces by the National Treasury to fund their public services and pay their employees. Since the national government decides how to apply this fiscal compensation, it often carries political implications.
La Rioja, Tucumán and Santa Cruz are run by governors of the Victory Front (FpV) and make up the group of 13 provinces that have received State funds because “they are temporarily incapable of financially tending to their most urgent needs due the execution of their budget and paying off debt.”
As the province of former Presidents Néstor Kirchner and Cristina Fernández de Kirchner, any action on the current administration’s part regarding Santa Cruz is perceived as politically charged. Regarding federal co-participation, Governor Alicia Kirchner (sister of former President Néstor Kirchner) made several complaints to the government regarding Santa Cruz’s need for financial aid.
The province of Santa Cruz is in financial and social hot water: union strikes have paralyzed the province over unpaid salaries for weeks. Workers have united under one “United Union’s Front” which include teachers, health professionals and administrative workers. Today, health workers confirmed a 72-hour strike.
There have also been protests against corruption in the province during the judiciary’s raid of 50 properties belonging to businessman Lázaro Báez, the man at the center of the “K Money Trail” scandal, an enormous money laundering scheme that has rocked the country.