Friday 27 January 2023

Minister Of Finance Resigns

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27 January 2023 - At The Banks - BCCR

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The Minister of Finance (Minista de Hacienda), Rocío Aguilar, amid a press conference on Wednesday, resigned her position.

Rocio Aguilar on Wednesday resigned effective immediately her position as Minister of Finance.

The decision, said Aguilar, came after it became known that the Comptroller General (Contraloría General) recommended that the president sanction her for 30 days for paying the central government’s commitments to its creditors, at the beginning of this administration, without budgetary content.

The administration of Luis Guillermo Solís had exhausted payment authorized by the Legislative Assembly to pay the public debt in the first months of 2018, leaving behind a financial gap of about ¢600 billion colones in the payment to creditors, which are mainly the public institutions themselves, such as the CCSS and the state banks.

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Aguilar presented her letter of resignation to President Alvarado Wednesday morning. With her decision, Aguilar did not give the president time to consider whether to apply the sanction but resigned immediately.

At the afternoon press conference, Aguilar praised the work of President Alvarado, is persistence and courage to push forward to have the tax reform approved. The Ley de Fortalecimiento de las Finanzas Públicas (Law on Strengthening Public Finance) was approved by Legislators in only four months.

With the management of Rocío Aguilar, by 2020, the central government will achieve one of the largest spending containments of the last decade, with a decrease of 4.3% compared to the 2019 spending plan.

On May 30, 2018, less than a month after taking office, Aguilar appeared before the Legislative Assembly and presented a plan with 11 measures to reduce government spending by ¢49 billion colones during the first year of Carlos Alvarado’s government.

One of the key decisions of Aguilar was for Central Government employees to have an identical salary increase, regardless of the amount of their base salary. In addition, she informed of the decision to curb the growth of the annuities, by fixing said incentive as a fixed nominal amount, instead of a percentage.

In July, the Ministry of Finance, led by Aguilar, obtained the approval of the Legislative Assembly to place Eurobonds for US$1.5 billion dollars, which is expected to reduce the cost of public debt and also a lower pressure on interest rates local.

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Following her resignation, Aguilar said that public expenditure control measures must be maintained because they do not depend on one person, but in law.

“The fiscal rule cannot depend on a person, there is a law,” said Aguilar, while calling for consolidation of efforts to achieve the fiscal balance.

“My recommendation is that we not abandon that (fiscal) reform, that it should not be degraded,” he continued.

 

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