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government inefficiency According to a recent report from the Central Reserve Bank (BCR), this is costing Peru S$16,394 million a year.
The amount calculated in Inflation report March BCR exceeds the resources available to the Ministry of Transport and Communications, whose portfolio had the largest budget for projects in 2022.
According to the monetary entity, the figure was obtained taking into account the waste of resources, which is carried out when public officials purchase goods and contract services in the course of work.
“If we take into account the size of government spending in Peru in 2021 (21.0 percent of GDP) and the ratio between contracts for goods and services and attachmentsit is possible to extrapolate the measurements made in the course of the reviewed papers to have an idea of the impact of excess and wasteful use of resources as a consequence of the inefficiency of the public procurement process, ”they explained in their report, which took into account the bank account methodologies of the Inter-American Development Bank, the International Monetary Fund and Accounts Chamber.
The minimum that the country loses every year due to the mistakes and inefficiency of officials and possible corruption is 10,853 million Singapore dollars. While another calculation under the IMF method puts the loss at around S$12,557 million per year.
BCR points out that such waste of public resources could hurt potential growth economyand not only subtracts resources from the country, but also leaves infrastructure of lower quality, that is, there is a backlog in development.
“Reduction inefficiency in public procurement is important insofar as it allows more resources to be devoted to narrowing the high gap in the economic and social infrastructure of the country,” they point out.
For its part, the Comptroller of the Republic’s calculation warned a few months ago that for every S$100 spent in the state, at least S$13 is lost through incompetence, waste or theft.
Similarly, a few years ago, the Accounts Chamber indicated that the cost inefficiency in a state it can be up to five times greater than corruption.
Source: RPP
I’m Liza Grey, an experienced news writer and author at the Buna Times. I specialize in writing about economic issues, with a focus on uncovering stories that have a positive impact on society. With over seven years of experience in the news industry, I am highly knowledgeable about current events and the ways in which they affect our daily lives.