CLARIN – One of the definitions of fraud is: “Financial deception with the intention of obtaining a benefit and with which someone is harmed”.
The chronic rate freeze, such as the one practiced without any economic or social need, such as the one imposed by Kirchnerism in its three previous presidencies and which it claims in this fourth, is an economic deception perpetrated to achieve political gain, harming all citizens in various ways. : inflation, currency traps, restrictions on services, lack of investment, genuine jobs, etc. being the sectors with the least resources the most affected.
Energy populism replaces fair rates with arbitrary and chronic subsidies, when a subsidy must be limited in time and respond to economic and social reasonableness, never to political interests, especially when it comes to public services.
Given the clearly negative results of the K rate policies, it is curious the degree of acceptance that they continue to have in a large part of society, despite having enjoyed the benefits of a healthy rate in the past. In effect, by 2001 the tariff covered all the costs of the KWh and M3 of gas, as the regulatory frameworks of the energy sector established by law in the early 1990s were respected.
The electricity and gas rates did not have subsidies, that is, the State did not put a peso and collected taxes while all investments were paid by the private sector. They were the lowest rates in the region, they promoted the rational use of energy mitigating the environmental impact and the services were of international quality, without cuts or shortages. At that time, the average rate for electricity and gas meant 5% of the average salary and at the end of 12 years K, 0.5.
That is, electricity and gas rates reduced their participation in the average salary 10 times, but at a cost of more than 3 points of GDP in subsidies that generated serious problems for the economy but that people did not attribute to the rate reduction . Given the great political payoff from this tariff fraud carried out in previous K negotiations, the current one is willing to maintain it.
It would seem that in our country “story kills reality” and that is why the government insists on fictions and abstract concepts more typical of a preacher of a religious sect than of a national official.
An eloquent example of this semantic creativity is the following sentence from the Enargas controller, “We must have fair, reasonable and affordable rates that allow productive sustainability and distributive justice. We want users to once again be the center of public service and for public service to be consolidated as a social right and a guarantee of Human Rights ”. Digression: I had to ignore the Word proofreader bent on replacing “users” with “users”.
This is an election year and the government will use the energy sector for its political campaign, resorting as usual to electricity and gas rates and fuel prices. These costs of the electoral campaign of the ruling coalition will be compulsively charged to the whole society and also to the private shareholders of YPF, of course they will begin to notice it after the elections.
Two proposals are currently in dispute within the government, that of the Patria Institute, channeled by the intervened regulators RNRE and Enargas, which would accept only a tariff increase for electricity and gas of up to 9% and that of the Ministry of Economy that is fighting for an increase of the order of 35% from April so that energy subsidies do not exceed 1.7% of GDP, about US $ 7,000 million, a limit established in the National Budget. While the ministry’s proposal is for producers, that of the Homeland is for the other two components of service, transportation and distribution.
To meet the needs of the three segments, the average electricity and gas rates should increase by 50% from the first day of April, otherwise, the subsidies with Guzmán’s proposal would be 1.77% and with that of the Patria 1.87 .
It is necessary to emphasize that the proposal of the Homeland of 9%, after a two-year freeze and also ignoring the production segment in particular of gas, is highly irresponsible.
Regarding fuels, with prices free by law, but controlled by the government using YPF for its dominant position in the local market, despite being a private company, an increase of 18% has been arranged until May, 15% for oil tankers and 3% for the State. That adjustment, which I estimate will be the last before the elections, is insufficient but essential, not only for YPF but for the entire oil industry in the country.
15% is not enough compared to the increase in the price components, international barrel, dollar and inflation, which since August 2020 have increased 62, 29 and 30% respectively, while those of fuels in that period totaled 35% of which to industry it was only 14% and the rest to bio and taxes. It must be remembered that 80% of the income of our oil industry comes from the local sale of gasoline and gas oil, so it is dangerous to play politically with their prices because production would fall and it would be necessary to import.
In conclusion, the most feasible rate proposal is that of the Instituto Patria. It is the one that “pays the most” for the electoral objectives of “Christianity”. Of course, at a very high country cost that we will all have to pay.