Economy Minister Axel Kicillof announced changes in subsidies

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Economy Minister Axel Kicillof today announced a rate adjustment plan he called “partial reallocation and reduction of subsidies and responsible consumption” along with the Federal Planning Minister Julio De Vido. It reaches gas and water rates and will be applied in three stages, in April, June and August.

As introduction, the transport minister said: “The subsidy policy will remain carried out by the National Government. This decision is not an error or a lack of attention, but a deliberate measure to sustain the model of economic growth with social inclusion started in 2003.”

He added: “For companies, the subsidy will decrease prices and gives them more room to produce, while for families means more income. One would increase the competitiveness and another gives more spending power, which feeds the power of consumption and the demand to boost domestic growth.”

“We will implement a redistribution of subsidies, we will not charge the full rate because we remain committed, but we ask to avoid wasting it, because it is scarce. We are going to encourage responsible consumption” he said.

Directly after that, Kicillof went on to explain how the reduction of subsidies will be: “The cut is designed so that anyone who manages to make a reduction in power consumption by 20% or more from a two-month period to another, will have subsidies” and argued: ” If the reduction is between 5% and 20%, it will be removed approximately 50%.”

But he said: “If there is no improvement in the responsibility of the consumer, he’ll pay the total bill”.

On the other hand, he stressed that the measure will not be applied equally to all, “there are exceptions to this. Those whose conditions force them to require subsidies must communicate it and enter a record in which they must actively enroll, so we will not take it away.”

After he explained the term “redistribution” and “responsible consumption”, he went on to explain how the “reassignment” will be done: “the money will be allocated to the Universal Child Allowance (AUH) and the plan “Progresar”, which improves living conditions and opportunities of the people but also generates purchasing power.”

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