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Rosselló administration satisfied with Fiscal Plan’s certification

By on March 13, 2017

SAN JUAN – Puerto Rico’s secretaries of State and Public Affairs, Luis Rivera Marín and Ramón Rosario, respectively, as well as Secretary-General William Villafañe expressed satisfaction following the Fiscal Oversight & Management Board’s approval Monday of the local government’s amended fiscal plan, saying it is in line with Gov. Ricardo Rosselló‘s established path.

Now that the fiscal plan has been certified, the government is expected to negotiate the public debt with creditors via Title VI of the federal Promesa.

Although the fiscal board decreed that reducing public workers’ workweek and Christmas bonus is subject to the government’s compliance with the fiscal projections established in the plan, which they must uphold in the budget to be presented in April 30, the Rosselló administration’s spokespeople stressed that these measures will not end up being implemented.

Public Affairs and State secretaries and the secretary-general celebrated the fiscal oversight board's certification of the government's amended fiscal plan and insisted the latter is congruous to the administration's policies. (Cindy Burgos/CB)

The secretaries of State and and Public Affairs as well as the secretary-general celebrated the fiscal oversight board’s certification of the government’s amended fiscal plan. (Cindy Burgos/CB)

“The governor of Puerto Rico isn’t concerned whatsoever about the part that reduces the workweek or the Christmas bonus because his plan will be executable; it will work,” Rosario replied to a question from Caribbean Business during a press conference in La Fortaleza.

Will the government be willing to face the oversight board if the fiscal projections aren’t met and the government is required to reduce work days or enact stricter measures, CB asked.

“It’s not a matter of whether we are willing, it’s that we do confront them. Since the first weeks we have said ‘we won’t dismiss public employees and we won’t reduce workdays.’ That is why we are where we are, because we said ‘no’ since the first day,” the Public Affairs secretary said.

See also: Financial Oversight Board Approves Puerto Rico Fiscal Plan

For his part, the secretary-general said he believes that after the board’s fifth meeting, not only is trust being reestablished with government creditors, but also the U.S. government’s in Puerto Rico’s administration as well. He stated the fiscal plan “is coherent,” “protects the most vulnerable” and brings back “socioeconomic sustainability” to the island.

Villafañe stressed that the changes in the fiscal plan don’t affect the government’s goal to increase public workers’ minimum wage by July 1, since the money is already in the budget.

Although the fiscal board closely monitors that the government complies with its projections, the Public Affairs secretary believes it certified “that second path proposed by the governor,” which does not include the layoff of public employees, the reduction of the workweek or the elimination of the Christmas bonus.

Rosario explained that the 10% cut to pensions proposed by the board will only apply to those who receive a check of less than $2,000 a month, who are the “most vulnerable,” as Rosselló had requested.

Those who receive more than that amount will see their pensions reduced in a “progressive” way, that is, the more they earn, the more they contribute. This means that pensions of more than $10,000 a month will be cut by up to 15%, including those provided by the Judiciary Retirement System.

“Judges have the right to litigate [the cut to their pensions]. Judges also have to make sacrifices,” the official said regarding the possibility that the government’s decision is challenged.

Speaking about the $1 billion in healthcare cuts proposed by the board, Rosario said the executive branch reduced the number and divided—$300 million in 2018, another $300 million in 2019 and up to $700 million in 2020—so “access to healthcare” will not be affected by those who have the government’s medical plan. The number of beneficiaries will not be reduced either.

“Many today wanted the board today to disagree with the governor and say his plan was not enforceable. The credibility this administration has earned today has made them look bad,” added Rosario, who confirmed that the government held intense discussions with the board throughout the weekend to achieve the plan’s certification.

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