Law Advances to Return State-Funded Expenses to Central Government

Bolivia's Senate has taken a significant step toward rebalancing fiscal responsibilities by approving a law that shifts the financing of certain national-level obligations back to the central government. This move aims to alleviate the financial burden that regional governments, known as 'gobernaciones,' have carried for years.

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The approval represents a concrete fiscal relief for the regions and highlighted that the agreement reached with the Government bloc allowed a proposal that was not initially incorporated into the reformulated budget to become law.

The approved law designates the National Treasury (TGN) to assume costs previously borne by the gobernaciones. These include expenses for inmate upkeep ('prediarios'), vaccination bonuses for healthcare personnel, and the free issuance of high school diplomas. The legislation, part of an agreement to facilitate the reformulated 2026 General State Budget, also covers national funding for healthcare worker travel expenses, merit-based salary increases, and other benefits, as well as nationally administered university scholarships and the maintenance of sports infrastructure.

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the norm returns to centralism obligations that never should have fallen on the departmental governments.

This legislative action responds directly to demands from the country's nine governors, who met in July to advocate for a review of norms that transferred financial responsibilities without adequate economic backing. The new law ensures that funds previously allocated by gobernaciones to these obligations will remain under their administration for reprogramming according to their core competencies. It also prohibits new automatic debits or mandatory transfers from departmental fiscal accounts.

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it constitutes the beginning of a necessary reform to financially strengthen the autonomous territorial entities, although he pointed out that there is still a way to go to achieve 50/50.

Senators like Leonardo Roca (Libre) hailed the approval as concrete fiscal relief for the regions, emphasizing the collaborative effort that transformed the proposal into law. Luis Fernando Roca, former legal secretary for the Santa Cruz Governorate, who assisted in drafting the bill, stated that the law returns responsibilities to the central government that should never have fallen on the departments. He estimated that Santa Cruz alone would gain over 80 million Bolivianos for its own functions. Governor Juan Pablo Velasco celebrated the law as a necessary start to strengthening autonomous territorial entities, though he noted that achieving a 50/50 fiscal balance is still a work in progress.

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the law is a concrete first step towards strengthening autonomies and explained that the final text incorporated several proposals.