Departments improve their financial management but lack tools to strengthen their fiscal performance

Regions must boost their fiscal autonomy. Photo: Image generated with artificial intelligence.

Departments improve their financial management but lack tools to strengthen their fiscal performance

TL;DR

  • The aggregated score for the departmental Fiscal Performance Index (IDF) decreased from 56.6 points in 2023 to 53.5 in 2024.
  • Key indicators contributing to the IDF's decline include primary balance, fixed capital formation (FBKF), dependence on transfers, indebtedness, and investment execution capacity.
  • Positive contributions came from revenue collection and programming, and current savings.
  • Departmental expenses reached $52.8 trillion in constant 2024 pesos, with investment accounting for 82.3% of total spending.
  • Departmental revenues reached $49.9 trillion in constant 2024 pesos, with growth primarily driven by national transfers (45.2% of total revenues).
  • Own revenues saw only a marginal increase of 0.01%, indicating limited fiscal autonomy.
  • 81.2% of departments are classified as 'At Risk' due to structural weaknesses in fiscal sustainability.
  • Planeación Nacional suggests diversifying tax sources, improving revenue collection, promoting fixed capital formation, prioritizing impactful investment projects, and fostering realistic financial planning.
  • Significant regional gaps persist, with differences of over 30 points observed between high and low-performing departments.
  • 24 departments used debt as a source of income in 2024, with the highest concentrations in Antioquia, Cundinamarca, Atlántico, and Valle del Cauca.