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Court Rules Gov’t Must Increase Funds for Poor

January 6, 2006

THE Constitutional Chamber of the Supreme Court (Sala IV) ruled last week that the government must reserve ¢100 billion ($202 million) of its 2006 budget for programs providing assistance to the poor.

 

According to the daily La Nación, the judges made their decision following a lawsuit filed by the Ombudsman’s Office last year. The office criticized the government’s failure to comply with Article 9 of Law 6914, which states the Finance Ministry must turn over to the Social Development and Family Assistance Fund (FODESAF) 20% of the funds collected in sales taxes each year. FODESAF is a branch of the Labor Ministry that coordinates programs for poor people. Its budget includes housing bonds and funds for school lunchrooms, food for children who live on the streets, pension payments for disabled people and other expenditures.

 

Sales tax collected last year totaled ¢520 billion ($1 billion), according to calculations made by the Comptroller General’s Office. However, according to the Ombudsman’s Office suit, filed in July 2005, FODESAF had not yet received any of the funds, the daily reported.

 

The Sala IV ruling forces the ministry to turn over not only those funds, but also to ensure that the annual budget devotes at least one-fifth of the monies collected through the sales tax to the poor, as Law 6914 requires. For this change to occur, the Finance Ministry will need to submit a special budget to the Legislative Assembly so legislators can vote to change the 2006 spending plan approved in December.

 

FODESAF isn’t the only organization affected by late or missing payments from the ministry. La Nación also reported that the Public Education Ministry and Child Welfare Office (PANI) are among the organizations to which the ministry turned over funds after months of delay. Most ministries and organizations that receive social spending from the government were forced to alter their plans last year because of this trend.

 

The 2005 edition of the annual State of the Nation report said the ministry’s tendency to withhold funds is a serious problem for social programs.

 

Former minister Federico Carrillo, who resigned in September (TT, Sept. 30, 2005), justified such policies by arguing that the government could not afford the payments the budget, or the country’s laws, required. New minister David Fuentes is waiting for official notification from the Sala IV to review the details of the case before taking action, a spokeswoman from his office said this week.

 

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