Peru Budget Panel Advances S/266.5bn Plan With New Spending Restrictions

Peru’s bicameral congressional budget committee voted on 5 November 2026 to advance a proposed S/266.506 billion public budget for 2027, adding restrictions on spending for official celebrations and measures intended to prevent unfunded public commitments. The vote was 29 in favour, one against and four abstentions. The committee’s decision is not final passage of the national budget: the proposal still requires debate and approval by the full Congress.

The congressional communications office identified the measure as substitute text for legislative proposal 00002-2026-2031-CR and put the proposed total at S/266,506,316,735. It covers central, regional and local government spending. Separately, Peruvian outlet La República reported that the proposed total is approximately 3.5% higher than the initial 2026 budget, with S/166.613 billion for the national government, S/58.672 billion for regional administrations and S/41.222 billion for local governments.

One provision would prohibit public agencies from spending money on festivities, receptions or comparable celebrations during 2027, except where such expenses fall within an agency’s legally assigned functions. The proposal also tightens the rules for committing future-year funds and seeks Finance Ministry assessments of financing capacity for certain government-to-government investment contracts. These are proposed controls, not findings that a particular institution misused money.

The committee-approved text would permit public health bodies to fill funded vacancies through merit-based recruitment of clinical, technical and auxiliary staff. Finance Minister Elmer Cuba said the health measures could cover roughly 5,010 positions. The package would also allow budget adjustments through 31 March 2027 to fund bonuses, severance-related benefits and social-security contributions for workers under the CAS public employment system. Congress said the latter provision could affect 226,401 workers.

The committee text envisages adjusting existing agency budgets to meet the labour obligations, rather than automatically granting additional Treasury funding. Whether agencies can fund these measures without displacing other services is an implementation question, not a conclusion established by the committee vote.

Congressional leaders aim to bring the bill to a plenary debate in mid-November. Until the legislative process is complete, the committee-approved figures and restrictions remain proposals rather than enacted spending authority.