Shorty after taking office, President Mauricio Macri announced he would implement a profound restructuring of the Argentine bureaucracy. The argument? It was archaic, inefficient and filled with ñoquis — a term used to refer to people who collected a paycheck from the State but didn’t really contribute in the positions they held.
Historically, political parties have people on the State’s payroll as a way of rewarding them for a role they might have played in either getting elected or making sure the status quo stays going in the direction they want. “Why don’t they pay them out of their own funds then?” you ask. There are three options: Because spending taxpayer money is more advantageous for them; because they don’t actually have the money; or because the people in question don’t have a role that is entirely regulated, or legal — like Punteros, or political organizers.
During the first months of the Macri administration, numerous state workers were laid off, presumably for being ñoquis. This prompted several marches from the state workers unions, who said that, while they supported a ñoquis purge, claimed that the workers being targeted were active and depended on their now long-gone wages. As a result of this, the State did review some contracts and brought back a few workers, but most lost their public sector jobs for good.
However, almost a year and into the Macri administration, a report from the Freedom and Progress Foundation (Fundación Libertad y Progreso) informed the press that — knowingly or not — the government not only didn’t reach its goal of cutting down public sector jobs, but actually increased the “structure of the State” by 25 percent.
We have no way of knowing if the government effectively got rid of the underperforming workers — or if it targeting those placed into their posts during the Kirchner administration to make room for their own — but based on these statistics, we can conclude that they definitely no longer think that an efficient state is a small state.
As for its impact in the fiscal deficit, sources from the Treasury Ministry told La Nación that this flip-flop won’t be an inconvenience to achieve their goal of lowering it to 4.2 percent of the GDP. However, former Finance Secretary Guillermo Nielsen predicted that it will actually end up near 8 percent.
According to the foundation, when former President Cristina Kirchner took office in 2007, there were 10 ministries. When she left in 2015, there were 16. Macri, on his end, created five more.
Moreover, another report from FIEL consultancy firm informed that the national public sector employed 460,000 people in 2003. In 2016 that number was 739,000. When taking into account workers from provincial and district administrations, that number goes up to 3,579,000. That’s almost a third of the entire Argentine workforce.
Freedom and Progress foundation heads, Agustín Etchebarne and Manuel Solanet, presented a plan to the government to lower the number of ministries from 21 to 7, having some of them be absorbed by other departments, eliminating 87 secretariats and 207 under-secretariats, bringing down the number of directions from 687 to 91 and institutes from 122 to 98. Their proposal was rejected.
Etchebarne told La Nación that the main problem about having so many ministries is the fact that “each one of them has its own administration, which increases public spending.”
“Each structure means a private secretariat, a legal and technical secretariat, a treasury department, an auditing department, human resources, public relations, press, foreign affairs, and so on,” he explained.
In order to tackle this issue, Etchebarne assured that “they have to eliminate these structures, but taking care of people, paying them a salary until they can be incorporated to the private sector.” He also proposed to “work with incentives: the state could pay the workers’ contributions to the companies who hire them for two or three years.”