National Development Plan
Propositional Analysis
Delivery – March 23, 2023
Timeline
After 3 days of discussion by the joint economic commissions, the National Development Plan (NDP) bill was approved in its first debate. It is noteworthy that today was the deadline for such approval, according to the legal timelines established for the legislative process.
Likewise, it is worth mentioning that the substantive discussion took place on this last day, during which the bulk of the articles regarding the funds proposed by the government and the articles corresponding to extraordinary powers were considered. First, the article creating the Fund for Equality and Equity (Art. 266) was rejected, which was a hard blow for Vice President Francia Márquez, as this fund was intended to be administered by the Ministry of Equality and Equity. Second, the articles corresponding to the extraordinary powers requested by the President of the Republic were rejected for: the structuring of the business group in the electricity sector (Art. 305); institutional strengthening in digital security and space affairs; the creation of the National Agency for Science, Technology, and Innovation (Art. 308); and the reorganization of trust funds managed by public entities (Art. 309). Taking into account the above, the approval of the National Development Plan (PND) proceeded as follows:
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March 21
Approved Articles 276 Deleted Items 21 Pending Articles 61 ARTICLES APPROVED BY SECTOR
Aeronautical 155, 228, 316 Agriculture and Land 29, 38, 39,40,43,44,45,46,47,48,49,66, 173, 176,177, 178, 179, 287, 327, 328, 334 Creative industry and intellectual property 87,135,146,147,148,149 Catastrophe and land-use planning 16, 22, 23, 32, 33, 34, 37, 168, 311, 319, 326 Science, Technology, and Innovation 136,137, 181 Education 97,98,99,100,103,104,106,107,310 State Structure 5, 6, 13, 25,78,81,140, 156, 157, 159, 162, 169, 171, 174, 175, 188, 192, 216, 224, 279, 295, 280, 313 Industry and Commerce 68,69,80,152, 208, 210, 227 Infrastructure 85,193, 206, 207, 222, 245, 314, 317 Labor 59,60,61,63,64,65,94,246, 339 Environment and climate change 17, 18, 19, 27,41, 182, 185, 213, 215, 320 Mining and energy 184, 189, 190, 197, 198, 199, 200, 202, 330 Total Peace and Equity 7, 8, 9, 10, 12, 15, 56, 86,89,90,91,92,93, 154, 161, 163, 164, 170, 180, 242, 276, 285, 292, 293, 318, 323, 325, 329, 331, 341, 342, 350, 352, 357 Cheers 122,124,127,128,129,130,131,134, 167, 348 Public Services and Sanitation 88,151,153, 187, 201, 211, 220, 221, 333, 338, 347, 351 TIC 111,112,113,114,115,116,117,118,119,120,121 Transport 138,139,142,143,144,145, 183, 203, 204, 219, 227, 229, 230, 232, 300, 322, 340, 344, 345, 354 Tourism 218, 247 Others 1, 2. 3. 4. 14, 28, 51, 52, 53, 54, 55, 62,70,71,72,73,75,77,84,108,109,110, 194, 195, 196, 212, 223, 225, 233, 234, 237, 239, 240, 241, 243, 244, 254, 255, 257, 258, 259, 263, 264, 267, 268, 271, 272, 273, 275, 284, 293, 295, 296, 297, 299, 315, 324, 332, 355, 321, 335, 343, 346, 349, 353, 356 ITEMS REMOVED BY SECTOR
Agriculture and Land 42 Catastrophe and land-use planning 31, 36 Environment and climate change 20 Mining and Energy 186 Cheers 123, 125, 126, 133, Transport 26, 141, Others 50, 76, 79, 101, 102, 166, 282, 283, 286, 290 -
MARCH 22
Approved Articles 48 Rejected Article 1 Pending Articles 12 ARTICLES APPROVED BY SECTOR
Agriculture and Land 24 Catastrophe and land-use planning 21, 30, 35, 251, 252, 253, Science, Technology, and Innovation 209 Education 337 State Structure 165, 172, 191, 200, 250 Extraordinary Powers 301, 302 Industry and Commerce 248 Infrastructure 214 Mining and energy 217 Total Peace and Equity 56, 158, 235, 236, 281 Cheers 132, 260, 277, 298 Transport 205, 312 Tourism 249 Others 11, 57, 82, 83, 96, 150, 238, 256, 261, 262, 269, 270, 274, 288, 289, 291, 294 ARTICLE REJECTED BY SECTOR
Total Peace and Equity 160 -
March 23
Approved Articles 7 Rejected Article 5 APPROVED ARTICLES
Extraordinary Powers 303, 304, 306 Funds 95, 226, 265 Validities 358 REJECTED ARTICLES
Extraordinary Powers 305, 308, 307, 309 Funds 266
Finally, the approval in the first debate without major modifications represents a first victory for Gustavo Petro's government, which will now have to enter a new phase of negotiation ahead of the second debate, during which they will have to review more than 4,000 proposals that remain valid for discussion with the various political actors.
Delivery – March 15, 2023
Introduction
The last three weeks in the legislature have been filled with public hearings and summons for officials to discuss the National Development Plan (PND). The report for the first debate will be ready soon and will be voted on by March 22nd at the latest, which is the deadline Congress has to process it at this stage. Although there is consensus on some points, others continue to cause controversy, such as the extraordinary powers being requested by the President. These kinds of differences are what have been refined in meetings between the rapporteurs and coordinating rapporteurs with the Ministry of Finance in recent days.
Aware of the relevance this discussion holds for the country's economic and social development project in the coming years, from ORZA, we have prepared the following document, which consists of two parts: in the first, we explore the Government's main priorities in the National Development Plan (PND), the most controversial points, and the correlation of political forces surrounding its discussion. In the second, we provide a quantitative analysis of the proposals that have been presented.
Analysis
Government Priorities
The National Development Plan (NDP), as a government policy roadmap, requires an investment plan that ensures both the budgetary and fiscal balance of the proposal, as well as its operability. In other words, it must respect the Medium-Term Fiscal Framework. This instrument is known as the Multi-Year Investment Plan (MIP), in which the government also prioritizes strategic projects and their respective budgetary allocations. Taking into account both the MIP and the proposed articles, the following investment lines have been identified as the most relevant for each axis:
| Axis | Trillions | Main investment lines |
|---|---|---|
| Territorial ordering around water | 28 |
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| Human security and social justice | 744,2 |
|
| Human right to food | 47,4 |
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| Productive transformation, internationalization, and climate action | 114, 3 |
|
| Regional convergence | 136,5 |
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| Peace | 50,4 |
|
| Macroeconomic Stability | 83,9 |
|
As will be seen later, it is noteworthy that the largest proportion of proposals aim to add new strategic projects to the Multi-Year Investment Plan (PPI), and, moreover, the majority come from the Chamber of Representatives. In the end, it is the congress members with strong regional enclaves who show the most interest in projects from the regions they represent.
However, the challenge these proposals face is getting the Ministry of Finance's approval. José Antonio Ocampo has had a strong influence on the discussion in the tax reform and the National General Budget, as the Ministry of Finance must ensure that changes in strategic projects maintain the fiscal balance of the PND. This is why the vast majority of proposals on this front will be denied.
The controversial points
Ministerial Change of Police (Art. 50)
It has already been confirmed that it will be eliminated in the report, as it stipulated that an institutional reform of the National Police would be carried out through the Ministries of National Defense, the Interior, and Justice.
Extraordinary powers (Art. 298)
The government is proposing the assignment of 14 extraordinary powers to President Petro, many more than Iván Duque requested in his National Development Plan (8) and Juan Manuel Santos requested in his second term (6). In this case, Petro is primarily requesting them to make modifications to entities, create new ones, make the necessary budgetary adjustments, establish the instruments needed for reindustrialization policies, create transfer systems, and modify existing programs. It is highly likely that these powers will be substantially reduced.
Smart Tariffs (Art. 210)
The discussion on the tariff policy proposed by the PND is open. The tension between a more interventionist trade policy or one more oriented towards openness is the core of the debate in this article. The article directly addresses trade with countries with which Colombia does not have free trade agreements, such as Russia, India, Japan, and China.
Energy Transition (Art. 188)
This issue has raised concerns among lawmakers due to the lack of a transition period. It has also been a source of concern because Article 188 proposes the creation of a 6% tax on the gross sales of power plants, which has been interpreted as a disincentive to the transition.
Cadastral update (Art. 36)
Article 36 proposes an update of the cadastral appraisals of all properties in the country during 2023, which will imply an increase in property taxes for the properties covered by the update. Although this is a key task to implement rural reform and strengthen the fiscal autonomy of territorial entities, it remains a heated discussion following the recent tax reform and the winds of economic slowdown blowing in the country.
The balance of power
The controversial points of the National Development Plan are the center of the conversations that the rapporteurs and coordinators have had with the Ministry of Finance, but the discussion around the PND is also a negotiation over political interests, as the parties that co-opt the debate, through the rapporteurs and coordinators of the project, have a better chance of successfully inserting their agendas in the dialogue with the Government.
As the graph indicates, it is clear that those who have the most influence on the discussion of the Plan are the congressmen who belong to the political parties of the governing coalition. Although the parties with the largest delegations in Congress each have four coordinators, the Liberal and Conservative Parties have a wider range of action due to having more rapporteurs, which opens up opportunities for them to create coalitions that advocate for specific issues and have a greater chance of incorporating them into the Plan. As has happened with other government projects, the agenda progresses, but always at the cost of negotiating with two of the three largest parties in the legislature.
These concessions are not accidental. On the contrary, they are the product of agreements with the Government that allow it to maintain governability in other policy areas, such as the parallel negotiation of social reforms. The Plan is a type of political and legislative discussion that is precisely suited for building agreements. By having the President the possibility to issue the National Development Plan by decree, the incentives for congress members to oppose such initiatives are reduced, and their willingness to negotiate to insert their interests, especially regional ones, into the Plan increases.
Quantitative analysis
As of February 16th, the economic commissions have opened the reception of proposals for the National Development Plan. Additionally, it should be noted that on February 21st, the project was presented by high-ranking government officials at the Congress of the Republic. Following its presentation, a series of meetings have been held since February 22nd between the coordinators and rapporteurs with officials from the Ministry of Finance and other interested entities such as the National Planning Department for the construction of the report for the first debate.
Among the tasks undertaken in the offices of the Ministry of Finance is the review of the approximately 3,000 proposals submitted by congress members up until March 10th. For practical purposes, proposals submitted up until March 6th will be considered, which total 1,571 proposals:
Of the proposals considered, 233 articles were identified out of the 300* in the text submitted to the Congress of the Republic, as well as the Multi-Year Investment Plan and the Framework of the National Development Plan. Of these, it is worth noting that 10.51% of the proposals submitted are amendments to the PPI; 0.81% to the framework; 56.41% to the articles; and 32.21% are proposals for new articles.
Chart 1. Type of propositions presented by axis and party:
Articles without propositions: 1, 6, 19, 25, 35, 44, 45, 46, 47, 67, 72, 74, 84, 107, 108, 109, 116, 120, 122, 131, 134, 148, 152, 175, 177, 180, 194, 195, 196, 201, 202, 204, 207, 212, 217, 219, 220, 223, 225, 232, 236, 237, 239, 243, 245, 247, 252, 253, 254, 257, 258, 259, 262, 264, 267, 268, 270, 272, 273, 275, 278, 282, 283, 285, 288, 297, and 299.
For its part, if the thematic axes presented by the Government in the bases of the PND and their articles are taken into account, it is observed that the submitted proposals are divided as follows: Human Security (685), Regional Convergence (214), Productive Transformation (206), Territorial Ordering (178), General Part (127), Macroeconomic Stability (123), and Human Right to Food (38). From the foregoing, it should be noted that the political parties that submitted the largest number of proposals for each of the axes were:
- Human Security: Green Alliance (210 propositions)
- Regional Convergence: Green Alliance (53 proposals)
- Productive Transformation: Historic Pact (54 propositions)
- Territorial Planning: Green Alliance (40 proposals)
- Macroeconomic Stability: Green Alliance (40 Propositions)
- Human Right to Food: Liberal Party (11 propositions)
Regarding the types of proposals submitted, the distribution is as follows: amendments (587), new articles (506), additions (346), and deletions (132). Notably, the Pacto Histórico was the party that submitted the highest number of amendment proposals and new articles, with 177 and 142, respectively. Meanwhile, it is worth noting that the parties in the governing coalition—the Liberal Party and the Green Alliance—submitted the highest number of deletion proposals, with 45 and 37, representing 34% and 28%, respectively. The articles with the highest number of deletion proposals are:
- Art. 141. Protection of life and personal integrity – SOAT Infractions (8 proposals).
- Art. 42. Modification of Article 36 of Decree Law 902 of 2017 – land titling (7 proposals).
- Art. 13. Assignment of the Territorial Renewal Agency (6 proposals).
- Art. 298. Extraordinary Powers of the President of the Republic (6 proposals).
- Art. 20. Amendment of Article 5 of Law 99 of 1993 – Animal protection and welfare policy (5 propositions).
- Art. 50. Police Institutional Architecture (5 propositions).
- Art. 160. Extraordinary powers for detention and resocialization of indigenous populations (5 proposals)
Chart 2. Proposals presented by party
As noted above, members of the Green Alliance party submitted the highest number of proposals, with a total of 421, representing 26.81% of the total (Figure 2). In this regard, the party submitted the highest number of proposals in the following sectors (see Figure 3):
- Infrastructure (29.8%).
- Total Peace and Equity (29.8%).
- State Structure and Planning (35%).
Graph 3. Propositions presented by sector and party:
The large number of proposals presented by the Historical Pact congressmen on education is striking: a total of 44 out of 114 proposals submitted. While the education reform is one of President Petro's key initiatives, it should be noted that Alejandro Gaviria was in charge of the ministry during the initial presentations on the proposed educational matters. Therefore, this could be considered a form of revenge against the former minister. Along the same lines, the Historical Pact presented the majority of proposals for amendments and new articles.
The proposals submitted for the infrastructure sector are largely amendments and additions to the Multi-Year Investment Plan aimed at prioritizing regional infrastructure projects. Of the 211 proposals, 69% (147) are amendments to the PPI, of which 71% (105) were submitted by members of the House of Representatives.
While the legislative work of House representatives focuses on advancing the interests of their respective districts, a large portion of the bills introduced reflect the national government’s vision, which is dominated by a focus on socioeconomic progress with a territorial approach. However, it could be argued that the legislative process itself lends itself to a greater role for the House of Representatives in the initial debates, so the ratio of proposals submitted by the two chambers could reverse as the discussion progresses.
As shown in Figure 3, 70.51% of the proposals (1,108) were introduced by the House of Representatives, while the remaining 29.51% (463) were introduced by members of the Senate.
Graph 4: Propositions Presented by Axis and Corporation
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