President Felipe Calderon's 2007 Budget Proposal Comes under Fire

President Felipe Calderon has announced plans to boost social expenditures to help alleviate poverty, but opposition members contend that the increases are more than offset by net reductions in some important educational and social programs. Calderon sent his 2007 budget proposal of 2.17 trillion pesos (US$200 billion) to Congress on Dec. 5. The president's proposal increases spending by almost 10% from the final budget approved for 2006 (see SourceMex, 2006-01-04).

Calderon acknowledged that his budget proposal was austere, even with the slight increase from last year, but he was faced with an anticipated reduction in oil-export revenues and the lack of proposals to boost taxes significantly in 2007. This meant that any increased spending in some areas had to be offset by reductions in other areas.

As part of his commitment to maintain a balanced budget, Calderon offered to cut executive-branch spending by 10%, including a reduction in his salary and those of his Cabinet secretaries and other high-level officials. The president also directed department heads to reduce expenditures for gasoline and electricity, travel, cell-phone calls, and other nonessential expenses. The austerity measures could provide the government with an additional 25 billion pesos (US$2.3 billion) to devote to social programs.

"For decades authorities have asked the people to tighten their belts and the people have done that," Calderon said. "Today the government must make the effort first."

In announcing the austerity measures, the president offered to make all expenditures public. "We will give accounts of every peso that citizens have given to the government," Calderon said. "Transparency and accountability are the responsibility of every democratic government."

Legislators from the opposition …

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Publication information: Article title: President Felipe Calderon's 2007 Budget Proposal Comes under Fire. Contributors: Not available. Magazine title: SourceMex Economic News & Analysis on Mexico. Publication date: December 13, 2006. Page number: Not available. © 2009 Latin American Data Base/Latin American Institute. COPYRIGHT 2006 Gale Group.

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