Wednesday, November 30, 2022

Congress approves austerity bill to stop waste and kickbacks

The lower house of Congress on Tuesday passed an austerity bill backed by President López Obrador that puts limits on government spending and bans high-ranking civil servants from working in private companies they regulated for a period of 10 years.

The Federal Law of Republican Austerity, which has already been modified and approved by the Senate, was supported by 321 deputies of the coalition led by the ruling Morena party while 124 opposition lawmakers voted against it. It will now be sent to the president for promulgation.

The law stipulates that “for no reason” shall bonuses or any other additional remuneration be paid to officials beyond what is established by the federal budget.

It bans the creation of special government trusts, which have been criticized for their lack of transparency, the refurbishment of government offices for “aesthetic” purposes and the purchase or lease of vehicles whose value exceeds US $19,000. The law also gets rid of the generous pensions paid to former presidents.

Former high-ranking officials will be barred from working in companies they regulated or in which they could use privileged information to which they were privy in their government roles for 10 years, twice as long as the ban that is currently in place.

The new “cooling-off” period is one of the longest in the world. López Obrador has called the revolving door between government and the private sector a “cancer of corruption.”

However, opposition lawmakers were critical of the 10-year ban.

Ricardo Flores, a deputy with the conservative National Action Party (PAN), said it was a violation of the right to “work freedom” and could potentially be a breach of the constitution.

Fernando Galindo Favela of the Institutional Revolutionary Party (PRI) said the ban is a violation of civil servants’ rights and charged that it was designed as a “means of political control.”

Half a dozen top officials at the National Banking and Securities Commission (CNBV) quit in the weeks leading up to yesterday’s vote and more officials are planning to resign before López Obrador signs the bill into law, the news agency Bloomberg reported.

Current and former officials who spoke with Bloomberg said the imminent approval of the austerity law was the main reason for the resignation of those who have already left the CNBV.

Galindo predicted that “the quality” of the public servants that will remain in the government “will be really bad.”

In contrast, Morena Deputy María de los Ángeles Huerta said the law will make the government more efficient and “austere” and bring the era of “golden bureaucracy” to an end.

“For this task, inevitably some sacrifices are required but the waste, secret allocations [of public funds] and kickbacks will come to an end . . . There will be a new dimension of ethics and morals in the federal administration, with which neither the PRI nor the PAN are familiar because they only had wasteful and corrupt governments,” she said.

Mario Delgado, Morena’s leader in the Chamber of Deputies, said the austerity law will be “another tool to combat corruption and serve the people, not economic interest groups.”

Source: El Financiero (sp), Bloomberg (en) 

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