Tariffs and subsidies: the war on Kirchnerism which Martín Guzmán condemned

from the day that wanted to launch to an official appointed by the vice president for energy, Martín Guzman became a person “unpleasant” for Kirchnerism. The drop in subsidies for electricity and gas tariffs wanted by the Minister of Economy was blocked by the majority of the Secretary of Energy. At the head of the resistance there was Federico Basualdo, Undersecretary for Electricitythat Guzmán wanted to supplant and could not.

Guzmán’s opponent, Basualdo had the support of the vice president, the Instituto Patria and La Cámpora. When Guzmán advanced with segmentationwhich was the way chosen by the Executive to bring about an increase in tax rates, Kirchnerism took off: «Let me explain. IMF “, Kirchner officials took off.

The struggle between Kirchnerism and Guzmán over the tariffs has been relentless. And the minister’s resignation seems to indicate that the standoff was won by those closest to Cristina Fernández de Kirchner. The sector that responds to the vice president has made low rates a kind of political banner that she does not intend to remove.

The government blocked the amounts of public service bills during 2020 and just raised them in 2021 (between 6% and 9%). During the past year, allocated more than 11,000 million dollars to subsidize this situation, as the cost of gas and electricity is higher than what households pay for these benefits. In his initial settlement with the IMF, Guzmán promised to cut $ 3 billion from this year’s budget. To achieve this, ticket values ​​had to be increased.

The increase in electricity and gas will be 21% for the low sectors and 42% for the medium sectors. To reduce subsidies, it was necessary to increase the values ​​of the tickets much moreyes Guzmán entrusted that task to a person he trusted: Santiago López Osornio, Undersecretary for Strategic Energy Planning. But the head of that official is Darío Martinez, the Secretary of Energy. The man from Neuquén oscillated between his adhesion to Guzmán, his superior in the organization chart, and Kirchnerism, which gave him political support.

Due to the war in Russia, the IMF seemed to recalibrate some objectives of the program agreed with Argentina. Energy subsidies are expected to exceed $ 20 billion. “In order to respect what he (of Guzmán) has agreed with the IMF, the rates must have increased by 300%. It is crazy that it only generates more inflation”, the energy minister was questioned.