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Abstract
Recent research suggests that the Chilean Congress is marginalised in the policymaking process, especially when setting the budget. This paper argues that previous studies have overlooked the fact that the legislature uses two amendment tools – specifications and marginal notes – to increase the national budget and reallocate resources within ministries. This behaviour contradicts the constitution, which only allows Congress to reduce the executive's budget bill. To test this empirically, a pooled two-stage time-series cross-sectional analysis is conducted on ministries for the years 1991–2010. The findings clarify how the legislature surpasses its constitutional limits and demonstrate that specifications are useful to predict when Congress increases or decreases a ministry's budget.
Acknowledgements
The author is very grateful to Aníbal Pérez-Liñán, Scott Morgenstern, George Krause, Cassilde Schwartz and two anonymous reviewers for their comments and suggestions to improve this manuscript.
Notes
1. For instance, the congresses of Ecuador and Colombia increase their discretionary spending, reallocating the fiscal debt among budget items.
2. Previous studies have used the key informant technique to analyse the informal relationship between the assembly and the bureaucracy in Chile (for example, Ferraro, Citation2008; Siavelis, Citation2002).
3. All the key informants interviewed were asked about the budgetary negotiations, their role and goals in them, and their assessment of all of their counterparts in the negotiations. All the interviews were conducted without terms of confidentiality between 2004 and 2009.
4. For simplicity, in the rest of the study all the budgets analysed are referred to as pertaining to ministries.
5. The reports were downloaded from the Library of the National Congress website (www.bcn.cl), where it is possible to trace the history of the law. In this study I traced the history of laws 19.012, 19.103, 19.182, 19.259, 19.356, 19.430, 19.486, 19.540, 19.596, 19.651, 19.702, 19.774, 19.842, 19.915, 19.986, 20.083, 20.141, 20.232, 20.314 and 20.407.
6. Constitutional designers reinforced the executive to legitimise the concentration of powers that characterised the Pinochet dictatorship.
7. Phone interview, 4 June 2009. Unfortunately, there is no public record that could allow making cross-ministry comparisons over time to test this claim.
8. The rigid part of the Chilean budget is lower than its equivalent in Peru (95 per cent), Ecuador (92 per cent), Colombia (91 per cent) and Costa Rica (88 per cent), and higher than in Honduras (82 per cent), Bolivia (81 per cent) and Guatemala (66 per cent) (Cetrángolo, Jiménez, & Ruiz del Castillo, Citation2010).
9. Besides these reasons, members of Congress may be interested in having more influence in the public budget to advance their ideological preferences and to enhance their role as members of an institution that oversees the executive.
10. The amounts are estimated using the January 2012 prices as a reference.
11. Personal interview, Santiago, Chile, 15 May 2006.
12. Personal interview, Santiago, Chile, 18 May 2006.
13. In case of controversy between both chambers, a new special committee has to unite criteria to approve the public budget, but so far it has never occurred.
14. The amendments are approved by a majority of the present members in both the subcommittees and the SBJC.
15. The government does not have incentives to anticipate congressional preferences in its bill because it can amend it during the negotiations. Furthermore, the government knows that each year the SBJC does not review and amend all ministries' budgets owing to time constraints, and therefore cannot anticipate which ministries the SBJC will amend.
16. Personal interview, Santiago, Chile, 18 March 2006.
17. Personal interview, Santiago, Chile, 11 August 2005.
18. Personal interview with Rubén Catalán, technical member of the staff of the SBJC. Valparaíso, Chile, 13 April 2006. Ominami also emphasised this point.
19. Personal interview, Santiago, Chile, 17 January 2006.
20. The executive can still block this tool supplementing expenditures through the Provision for Committed Financing established in the Financial Administration Organic Decree Law No. 18,899 (Citation1975), although it rarely does.
21. Personal interview, Santiago, Chile, 17 January 2006.
22. The agencies are the ministries' administrative subunits. In Chile, they are called servicios.
23. The dependent variable in the second stage model was regressed on the independent variables of the first model and they were not correlated.
24. The test discriminates between both estimators examining whether the unobserved heterogeneity exists and should be handled as a random variable averaged across all i cross-section units, or instead be modelled explicitly by the inclusion of dummies for each cross-sectional unit save one (N − 1).
25. The null hypothesis is that there is homoskedasticity, and since (Prob > chi2 = 0.000), the test suggests that robust standard errors are necessary to account for heteroskedasticity.
26. By contrast, formal institutions ‘are created, communicated, and enforced through channels that are widely accepted as official’ (Helmke & Levitsky, 2006, p. 5).
27. The Senate Rules (available at www.senado.cl) do not differentiate specifications from the marginal notes.
Additional information
Ignacio Arana Araya is a PhD candidate in Political Science at the University of Pittsburgh, PA, USA