Uruguay intends to preserve its current fiscal deficit targets in the annual budget review bill that will be presented to Congress on June 30, Finance Minister Gabriel Oddone said at a press briefing in Montevideo.
Rather than loosening its fiscal stance, the government plans to direct newly approved funds toward several social priorities. Oddone said the additional budget focus will include measures to address child poverty, bolster policing, support education and assist people experiencing homelessness.
The administration raised its proposed year-on-year spending increase for 2027 to $81 million, an increase from the $50 million that was approved under last year’s five-year budget framework. Of the $81 million, an extra $31 million has been allocated specifically to child poverty initiatives that were put forward by a presidential social security commission, Oddone said.
Officials indicated the remainder of the incremental spending -- earmarked for policing, education and homeless services -- will be covered by improvements in tax collection and by reducing expenditures in other parts of the budget. Oddone described those funding plans as the means to absorb these new priorities while maintaining the deficit targets.
Separately, Rodrigo Arim, director of the Budget and Planning Office, outlined a structural change to child support payments. The budget bill will unify and increase cash transfers to children under a single program, with an explicit objective of reducing poverty among specified target groups by 25%, Arim said at the same event.
Taken together, the proposals present a plan to preserve fiscal discipline while reallocating additional resources toward social and public-safety programs. The text of the budget review bill will be formally submitted to Congress on June 30, where the measures and funding mechanisms will be considered.