FISCAL TRANSPARENCY - ARGENTINA

UNCLAS BUENOS AIRES 000378

SIPDIS

SIPDIS
SENSITIVE

STATE EEB/IFD/OMA ANDREW SNOW AND RICHARD FIGUEROA
STATE WHA/EPSC FOR PETER MAIER

E.O. 12958: N/A
TAGS: EAID ECON EFIN PREL PGOV AR
SUBJECT: FISCAL TRANSPARENCY - ARGENTINA

Reftel: State 16737

This cable contains sensitive information and is not for public
dissemination.


1. (U) Post submits the following responses keyed to reftel
questions.


2. (U) IS THE HOST COUNTRY'S BUDGET MADE PUBLIC? By law, the
Government of Argentina (GOA) makes public its national budget,
including revenues and expenditures.


3. (U) IF SO, THROUGH WHAT MEDIUM (E.G. PUBLICATION, INTERNET)? The
GOA budget is published in the Official Gazette and made public on
various GOA Ministry websites, including that of the Ministry of
Economy (http://www.mecon.gov.ar/basehome/informacion .htm).


4. (SBU) ARE ALL REVENUES AND EXPENDITURES INCLUDED IN THE
PUBLICLY-AVAILABLE BUDGET? No. In recent years, the GOA executive
has been empowered by Congress with "superpower" budget authority,
allowing the executive the discretion to make significant changes in
both overall budget expenditures and allocations, including
transferring funds to the provinces, all without congressional
input. In recent years, GOA executive-submitted budgets have
consistently understated anticipated revenues, allowing the
executive to use its "superpower" authority to directly allocate
over-budget revenues without parliamentary oversight, including in
ways some local analysts interpret as patronage designed to enhance
the executive's political influence over local and provincial
leaders. The GOA's National Auditing Office (Sindicatura General de
la Nacion, SIGEN),similar to the U.S. General Accounting Office,
does conduct irregular audits of ministry-specific spending and
makes its reports publicly available. A number of Argentine NGOs
also analyze the types and efficiency of GoA budget expenditures and
make their reports publicly available.


5. (SBU) IF THE REVENUES AND EXPENDITURES ARE AVAILABLE IN A
PUBLICLY-AVAILABLE BUDGET, HOW MEANINGFUL AND ACCURATE IS THE
INFORMATION? See paragraph 4.


6. (SBU) IF A COUNTRY IS WEAK ON FISCAL TRANSPARENCY IS IT DUE TO
CAPACITY OR LACK OF WILL? It is generally acknowledged by
independent economics and budget analysts that the GOA has the
capacity to be more fiscally transparent. The local media have
regularly carried allegations that, throughout 2007, the GoA has
systematically manipulated and understated domestic inflation
statistics; these reports have called into question the reliability
and accuracy of other GoA statistical measures, including GDP,
poverty and indigence statistics,that feed into budget preparation.



7. (U) ARE THERE ANY USG PROGRAMS TO STRENGTHEN THE HOST COUNTRY'S
CAPACITY TO DEVELOP SOUND FISCAL POLICIES AND THAT SUPPORT
TRANSPARENCY AND GOOD GOVERNANCE? No.


8. (SBU) ARE OTHER DONOR COUNTRIES OR MULTILATERAL INSTITUTIONS
(E.G. THE EU OR WORLD BANK) PROVIDING ASSISTANCE IN THESE AREAS?
The Inter-American Development Bank's 2004 IDB loan project
"Institutional Strengthening of the Economic Policy Secretariat"
includes components to strengthen federal budget processing
information systems.


9. (SBU) HAS THE COUNTRY VOLUNTEERED FOR THE IMF TO REPORT ON THE
COUNTRY'S COMPLIANCE WITH STANDARDS AND CODES COVERING FISCAL
TRANSPARENCY? No.

WAYNE