President Javier Milei’s government has once again watered down aspects of its sweeping ‘Ley Omnibus’ reform bill in a bid to win over wavering lawmakers.
Though the differences have narrowed between the government and pro-dialogue lawmakers, some disagreements persist, especially regarding the delegation of special powers.
On the same morning it emerged the government would delay the bill’s arrival to the lower house by another day, to Wednesday, Presidential Spokesperson Manuel Adorni confirmed in his weekday press conference that Milei had backtracked on key articles.
According to reports, those include his seeking of emergency executive powers that would have allowed him to unilaterally set policy on fiscal and pension matters for up to two years.
Those changes followed the decision to shelve the bill’s most important austerity measures last Friday. Confirming that decision, Economy Minister Luis Caputo said at a press conference that 280 articles, mostly linked to fiscal matters, had been pulled from the mega-reform bid.
Trimmed and slimmed
When it was first presented a month ago, the “Ley de Bases y Puntos de Partida para la Libertad de los Argentinos” contained 664 articles. Yet that version only had the full support of Milei’s La Libertad Avanza party; less than 40 votes in Congress.
The new version of the bill has fewer than 400 articles. The bill would still allow the privatisation of dozens of public companies – but not state oil driller and refiner YPF SA – and would grant emergency executive powers to remove key energy and transport subsidies, among other measures.
Milei holds small minorities in both houses of Congress and is counting on the support of the right-wing PRO party and more moderate members of two other political groups — the Unión Cívica Radical and Hacemos por Nuestro Pais — to push through his reforms.
The government has sought to build bridges since the bill entered committee stage, holding regular sessions of talks with the sector of the opposition they called “open to dialogue.”
It needs the support of at least 129 lawmakers, including its own, to be able to raise quorum and open debate on the bill in the lower house.
Sticking-points
The wall of resistance, which involved many provincial governors, has forced it to budge on fiscal matters.
PRO has been opposed to the proposed increase of agricultural export duties, while Hacemos and its Hacemos Coalición Federal trained its ire on the removal of the existing formula for calculating pensions and desired privatisations.
Milei’s government has now shelved its hike to export duties, retained the social security indexation formula and cut an expansion of the personal income tax base. State firms Nucleoeléctrica Argentina, Banco Nación and Arsat may also remain state-run but with private stakeholders, and among other bodies, the CONCIET state scientific research institute will also not be dissolved.
As for the Sustainability Guarantee Fund, the draft only includes an article authorising its transfer to the Treasury and would only allow the consolidation of debt.
Now, all eyes are on what the latest version of the bill suggests in terms of delegated powers – pro-dialogue lawmakers are still seeking a reduction in Milei’s demands.
The government’s Peronist critics, who are not open to dialogue, are heavily criticising the bid for extra powers.
"They removed the fiscal portion because they did not want to negotiate a balanced bill with their allies. It’s clear that no they aim for three things. 1) Delegated powers. 2) Debt flexibility. 3) Privatisations (FGS). That is where attention must be paid. Especially the first item,” criticised Peronist national deputy Leandro Santoro (Unión por la Patria) on X.
– TIMES/BLOOMBERG/PERFIL
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