Ecuadorian National Assembly Approves Financial Bill

At 20h00 on Thursday night, the Legislative Assembly of Ecuador approved the Financial Bill, with 73 votes in favor and 31 votes against, 1 absent vote and another vote in blank. The Second Debate of the Law took place yesterday with nearly 20 legislators, while the Government Party and the Opposition also debated the new Bill.

The Debate of the Law was observed by delegates from the Financial Ministry and SENPLADES, the Secretary of Planification.

Among the main changes of the Law, there is one that states the funds of the Ecuadorian Social Security (IESS) belong to a Single Account System, that are strictly a property of IESS and do not belong to the Treasury. In addition, the way the members of the National Council are chosen has been modified. The new Law states that the election of this Council will be made considering the intercultural issue.

According to Finanzas.com, this Law allows the Government to raise the National Debt when it needs to have financing programs or Public Investments Projects, as long as the National Assembly approves it. It also gives the Assembly the power to modify the Annual Budget of the Country. The site also adds that the Government could extend their capacity to receive internal resources from Banks through Public Bonds. With this Bill, the Government also has the power to reduce or extend in a 15% the Expenses Plan of the Government. The modification the Government can make does not apply to the budget already assigned to Sectional Governments.

Besides the measures to extend the Debt, the Bill authorizes the Government to pass short-term certificates, as instruments to obtain immediate cash in case they need it. Financial Entities will be able to buy this certificates with an interest rate up to 75%. Finanzas.com highlights the fact President Rafael Correa forbid these kinds of dispositions when he was a Financial Minister back in 2005.

“This Law should be called the Protection of the Compulsive Consumer Government Bill” said Paco Fierro, a legislator from the Opposition Party Sociedad Patriótica.

Many claims from legislators were considered, including the ones from the Opposition. Paco Moncayo’s remarks were recognized when he talked about the fact that the Law should recognize the Autonomy of the Decentralized Governments.  Fernando Cordero, President of the Assembly, affirmed this Law is very well done and there’s no reason for the President to veto it.