With the institutional optimization, the reduction of subsidies and excessive expenses, the changes in public companies, the transparency in public purchases, the government of Lenin Moreno plans cuts of $ 2,000 million until next year.
The General Secretary of the Presidency, Eduardo Jurado Béjar, indicates that of the $ 62 million that would be saved with the optimization, $ 40 million would correspond to the reduction of 1,500 officials who make “redundant activities” and the remaining $ 22 million to related expenses such as leases, services, internet and others.
In the new institutional structure, there would be twenty ministries that would comprise six mergers, highlighting the transformation of the Secretariat of Politics in the Ministry of Policy and Human Rights, absorbing the Ministry of Justice, and the only merger of three portfolios in the Ministry of Energy and Non-Renewable Natural Resources, absorbing Hydrocarbons, Electricity and Mining.
In public companies, the regime plans a saving of more than $ 300 million with: liquidation, merger, transfer of competencies, strategic alliances and strengthening of business, since most work at a loss, according to the government’s diagnosis.
Liquidation would go: the Cement Public Company, Strategic Ecuador, Fabrec, Enfarma and Yachay. A merger: Petroecuador with Petroamazonas. To strategic alliances: Tame, Correos del Ecuador, Santa Bárbara, Astinave, Ferrocarriles del Ecuador, Flopec. And to strengthen the turn of the business: CNT, CNEL, Celec, Enami, House for All, Public Media, Public Water Company and National Storage Unit. In addition to passing the competencies of the High Performance Training Center to the Sports Secretariat and the Ministry of Education.
For another $ 400 million in savings for transparency in public procurement, three actions are foreseen: restriction of the use of the special regime and expansion of automatic controls, expansion of participation and concurrence in the pre-contractual process and comprehensive reform of the law.
The diagnosis in public purchases is that 73% was made in the first offer, abusing the special regime between 2013 and 2017. In addition, fifty companies have first option to purchase from the State through the modality “sole provider”.
Looking for savings
Then there are the $ 120 million for subsidies that include super gasoline and industrial diesel, the $ 150 million in excessive spending in the public sector: sale of 1,000 vehicles, spending on cell phones, a 30% reduction in travel expenses and others, and a saving $ 200 million by lowering the cost of debt and country risk.
The economist Alberto Acosta Burneo believes that the savings proposed by the government is possible and necessary because the situation is unsustainable, but it requires political will to do so because it has a political cost: “That is why it is proposed through the macro-fiscal rules that it has that the primary deficit disappear until 2021, then the State has to stop spending around $ 2,400 million or, failing that, raise revenues or taxes for the same value “.
Jurado said that at the same time that we think about reducing expenses, we are also thinking about mechanisms for generating income.
On the reduction of the number of officials, Miguel García, president of the Federation of Public Servants, indicates that there are around 600,000 officials in total, that 1,500 is a significant reduction, that it is clear that Moreno inherited an “inflated bureaucracy because former President Rafael Correa took the public sector as a political booty “, but the moment the contests are suspended, the possibility of knowing who was necessary for the proper functioning of the state is removed. (I)