Peruvian govt authorities slow to spend annual budgets

Peru has shown slow progress in spending the public budget, with more than 35% of the total allocated for the year still remaining to be spent in the last quarter of the year.

Government authorities had spent an average of 64.3% of the total budget as of the end of September, according to the economy and finance ministry's (MEF) transparency portal. That equates to 168 billion soles (US$45bn) of a total of 261bn soles. 

However, progress in the budget spending of local governments (provincial and municipal authorities) is much lower than that of the central administration and regional governments.

According to the MEF, Peru's local governments have a combined budget of 49.9bn soles, and only 53.8% of that figure was spent in January-September. 

According to specialists, the reasons for the failure to use the budgets include the lack of technical capacities of local authorities, the change of municipal authorities, despite that taking place in January 2023, and bureaucratic obstacles.

The governments of the Huancavelica and Pasco regions, which are among the poorest in the country, have the lowest levels of budgetary spending, with only 40.8% and 41.0%, respectively, used so far this year. MEF figures show that the Huancavelica regional governments has a budget of 920 million soles and Pasco has 556mn soles.

Nevertheless, regional governments still have higher average budget execution than municipal governments and the national administration, having spent 68.2% of the allocated total. Seven regions have already spent over 70% of their annual budgets.

According to the MEF, the combined budget for regional governments amounts to 58.8bn soles. The table below lists the regions with the largest budgets and how much of them they have spent.

Region	Budget (billions of soles)	Percentage of budget spent in Jan-Sep
Piura	4.42	67.3%
Cajamarca	3.86	70.3%
Libertad	3.80	66.6%
Cusco	3.66	69.0%
Junin	3.35	72.7%

Source: MEF