Budget stalemate; what now?

COLOMBIA - In Brief 11 Sep 2024 by Andrés Escobar Arango

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On September 11th, the economic committees of the House and the Senate did not come to an agreement on the size of the national budget for 2025. Votes were insufficient to approve the size proposed by the Government, but votes also came short to reduce its size to a specific number. Even though the deadline for approving next year’s budget is September 15th, today’s stalemate is unheard of in recent times. There are three possible scenarios for what can happen in the next few days. Two of them could even take place as soon as September 12th. First, the economic committees can still work out an amount acceptable to the majority of its members and vote, thus ending the stalemate. The second one is the Government coming back to the table with a new amount acceptable to the majority. The third is a no-agreement scenario by September 15th, in which case the COP 523 trillion budget submitted by the Government becomes the budget for next year. However, in this third possible outcome, the COP 523 trillion amount requires COP 12 trillion coming from the “Financing Law” submitted to Congress on September 10th, for which clearly Congress has no appetite; in case this “Financing Law” is indeed rejected or watered down, the COP 523 trillion amount will be automatically cut to accommodate the shortfall. In the midst of this hitherto unseen uncertainty, one thing is clear: the Government’s control of Congress is fading away faster than expected.