Fiscal Irresponsibility and the Security Tax

Who would think it was OK to spend 1,800 million lempiras ($90 million dollars) from a fund whose balance is only 500 million lempiras ($25 million dollars)?

That's spending more than 3 times your current balance!

Juan Ferrera, head of the government commission that decides how to spend the income from the security tax, thinks it's OK.  Not only that, but he plans to borrow perhaps 600 million lempiras ($30 million dollars) to cover the shortfall from his commission's irresponsible spending, as short term loans from domestic Honduran banks which will be at high interest rates. He proposes to pay the loans back with the projected income from the security tax in 2014.

The security tax, new in 2012, is a tax on bank transactions intended to pay for additional security efforts in the country in general. After the tax was approved, it was modified by Congress so that in addition to reinforcing security, it could be used to "fortify the finances" of the government. It has been used as a candy jar for everyone's pet idea of how to spend government funds, and ultimately, they spent more than they will take in this year, by a lot.

Ferrera made the astounding admission that his commission, which was set up to make decisions about administering funds from the security tax, has made no decisions.  Instead, he says the decisions were made by the Secretary of Defense and Security (Arturo Corrales), the Supreme Court (Jorge Rivera Aviles), the Public Prosecutor's office (formerly Luis Rubi, now Oscar Fernando Chinchilla), and municipalities. 

Basically, if anyone proposed using funds from the security tax for any old project, it simply was done.  The commission headed by Ferrera totally abdicated its responsibility.

Naturally they overspent. There was no one accountable. 

The biggest winner by far has been the Secretary of Defense and Security, who assigned himself a whopping 716.7 million lempiras ($35.8 million dollars).  This includes paying for both the new Military Police (24.5 million lempiras), and a Police Special Operations Unit (los Tigres), both championed by Juan Orlando Hernandez and approved by the Honduran Congress.  While the Military police unit has started operations, with between 600 and 1000 troops chosen from existing soldiers, the Tigres unit has not even begun organizing itself, despite having been authorized last spring.

The latest proposed charge to the security tax:  800,000 lempiras to electrify the island of Isla Conejo, subject of a dispute with El Salvador.  Ferrera said

"There's no doubt that it's part of our territory and we need to exercise sovereignty in this place and because of that the petition [to electrify the island] was immediately approved....the money is already in the hands of the company that will carry out the project."

Has any of this spending spree made a significant change in the security of the Honduran people?

Not significantly by any of the measures that matter.  The government predicts that the murder rate will be around 80 per 100,000 population, while the National University's Observatory of Violence sees the rate continuing at 85 per 100,000 for the rest of the year, off slightly from its observed rate of 91 per 100,000 in 2012.

More militarization of policing, and intensifying a border dispute with a neighbor over an uninhabited island hardly seems like enough to justify the over-spending and lack of accountability demonstrated.