Government cuts another US$1.63 billion in spending amid tax revenue shortfall

Some time ago, Economy Minister Luis Caputo asked his Cabinet colleagues to send him spending cut proposals amounting to 2% of capital expenditures and 20% of general outlays. On Monday, the answer to that request began to emerge. A simple administrative decision signed by Caputo and Chief of Staff Manuel Adorni, published in the Official Gazette, revealed that the government decided to slash 211 programs carried out across different areas.  According to the measure, the savings amount to 2.8 trillion pesos (approximately US$1.98 billion at the official dollar rate). At the same time, the decision, which modifies the 2026 Budget, establishes an increase in spending on 15 programs, totaling US$263 million. The administrative order also adds around US$399 million in projected revenues, ultimately increasing the financial result by US$2.12 billion. The details of the cuts were analyzed by the Argentine Association of Budget and Public Finance (ASAP, for its Spanish acronym). In its report, the entity said the measure implies that “current expenditures decline by US$1.34 billion and capital expenditures by US$351 million).” The cuts Some of the Treasury budgets that have been cut are expenses in Government Administration, Social Services and Economic Services areas. The Economy Ministry cuts total US$374 million. The Interior Ministry cut funds for Treasury Contributions to Provinces (ATN, in Spanish) by US$226 million, as well as several transfers for social spending programs. Transfers have also been reduced to state-owned energy company ENARSA, state-owned education technology company EDUCAR S.A., public broadcasters Radio y Televisión Argentina and the state Ad Agency. In the healthcare sector, close to US$44.3 million were cut from programs including Strengthening Provincial Health Systems, Access to Medicines, Supplies and Medical Technology and Compensatory Health Coverage, among others. The Malbrán Institute — Argentina’s main public network of national laboratories and health research institutes — has seen its budget cut by US$821,000 and the national agency responsible for organ, tissue and cell donation and transplantation (INCUCAI) will lose US$707,000 in funding.  “A brutal adjustment” Alejandro Gómez, director of the Federal Consensus Institute think tank and a former Peronist lawmaker, said that “through Administrative Decision 20/2026, published in the Official Gazette with the signature of chief of staff Manuel Adorni, the national government carried out a brutal alteration of the 2026 National Budget, which had been approved by Congress barely four months ago.” “The recitals of the regulation, also signed by Economy Minister Luis ‘Toto’ Caputo, state that the administrative decision introduces reductions in budget allocations for several jurisdictions and entities of the National Administration,” Gómez said. Gómez argued that “after combing through the 588 pages of the annex hiding the fine print and the adjustment figures, true budgetary guillotine cuts emerge.”  He highlighted that the “research, prevention, early detection and treatment of cancer” program suffered a US$3.6 million cut. While the program “which concentrates resources for the prevention and control of communicable and vaccine-preventable diseases”, suffered a US$360,000 adjustment.