BUENOS AIRES, Dec 26 – Argentina’s Congress passed the 2026 budget on Friday, the first approved by legislators since President Javier Milei took office in late 2023.
The budget, passed 46 votes to 25 with one abstention, includes spending of $102 billion (148 billion Argentine pesos) and projects South America’s second-biggest economy will grow 5% with inflation at 10.1%. The bill projects a primary budget surplus equivalent to 1.2% of the gross domestic product.
The 2023 budget was the last one passed by Congress. During the first two years of his term, Milei’s government had extended the budget of the previous year without passing a bill in Congress, resulting in sectors being dramatically hit by inflation, which hit an annual rate of almost 300% in April 2024.
According to a report by the Civil Association for Equality and Justice, a Buenos Aires-based think tank, the new budget reflects a 7% increase in real terms from 2025 but a 24.6% drop in real terms compared to the 2023 Congress-approved budget. However, the think tank noted that some inflation projections are significantly higher than the executive branch’s forecast.
Milei has ruled with sweeping austerity measures, which have often generated massive protests, and in 2024 Argentina had its first budget surplus in more than a decade. Congress this year overrode Milei’s vetoes of bills boosting funding for public universities, pediatric health care and people with disabilities.
While the new budget boosts funding for social services -including health, social security and education – the bump does not compensate for sharp falls over the last several years, the ACIJ report said.
After a strong showing in midterm legislative elections in October, Milei’s La Libertad Avanza party gained considerable power in the newly elected Congress, becoming the largest minority in the lower house and increasing its bloc in the Senate. The government hopes that will help it push forward a series of overhauls, including overhauls to the labor and tax systems, in the coming months.
(Reporting by Maximilian Heath and Leila Miller; Editing by William Mallard)
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