Argentine President Javier Milei has proposed sizeable hikes in pensions, health, education and disability aid for 2026, signalling a policy reversal even as he faces backlash following his party's poor showing in recent Buenos Aires province elections.
Issued on: 16/09/2025 - 05:51
By: FRANCE 24
Argentina's President Javier Milei speaks on national broadcasting to announce the submission of the 2026 budget to Congress, September 15, 2025 in Buenos Aires. © Argentinian Presidency via AFP
Argentine President Javier Milei on Monday announced plans to boost spending on pensions, health, education and the disabled in 2026, marking a shift after nearly two years of biting austerity following a major electoral setback.
"The worst is over," Milei said in a televised speech, unveiling the draft 2026 budget eight days after his party was trounced in provincial elections in Buenos Aires.
"The effort all Argentines are making is worth it," Milei assured, while adding: "We understand that many have not yet felt it in their material reality."
Appealing for more time for his libertarian reforms to take effect, the firebrand president said: "Rome wasn't built in a day."
While announcing relief for some of those worst affected by his deep spending cuts, he insisted that balancing the budget – his paramount goal since taking power in December 2023 – remained "non-negotiable".
Failure to balance the nation's books, he said, would lead South America's second-biggest economy "back into the pit of uncontrolled inflation and the destruction of all hopes for the country".
He did not issue a growth or inflation forecast for next year.
The 54-year-old self-styled "anarcho capitalist" is facing considerable political and economic headwinds as he gears up for crucial midterm elections next month.
His party suffered a stinging defeat at the hands of the centre-left Peronist movement in elections to the legislature of Buenos Aires province that were seen as a litmus test of Milei's popularity.
He goes into the midterms under a corruption cloud, following allegations that his sister and right-hand woman, Karina Milei, received a cut on state medicine contracts for the disabled.
Argentine President Javier Milei on Monday announced plans to boost spending on pensions, health, education and the disabled in 2026, marking a shift after nearly two years of biting austerity following a major electoral setback.
"The worst is over," Milei said in a televised speech, unveiling the draft 2026 budget eight days after his party was trounced in provincial elections in Buenos Aires.
"The effort all Argentines are making is worth it," Milei assured, while adding: "We understand that many have not yet felt it in their material reality."
Appealing for more time for his libertarian reforms to take effect, the firebrand president said: "Rome wasn't built in a day."
While announcing relief for some of those worst affected by his deep spending cuts, he insisted that balancing the budget – his paramount goal since taking power in December 2023 – remained "non-negotiable".
Failure to balance the nation's books, he said, would lead South America's second-biggest economy "back into the pit of uncontrolled inflation and the destruction of all hopes for the country".
He did not issue a growth or inflation forecast for next year.
The 54-year-old self-styled "anarcho capitalist" is facing considerable political and economic headwinds as he gears up for crucial midterm elections next month.
His party suffered a stinging defeat at the hands of the centre-left Peronist movement in elections to the legislature of Buenos Aires province that were seen as a litmus test of Milei's popularity.
He goes into the midterms under a corruption cloud, following allegations that his sister and right-hand woman, Karina Milei, received a cut on state medicine contracts for the disabled.
Conciliatory tone
In a sign of the anger among many Argentines over his policies, Milei and his sister were pelted with stones on the campaign trail outside Buenos Aires in late August, with skirmishes breaking out among supporters and opponents.
The president's cuts to spending on the elderly and disabled particularly have also alienated many Argentines, who staged regular demonstrations against Milei.
An unusually conciliatory-sounding Milei said he would increase pension spending by 5 percent, healthcare by 17 percent, education by 8 percent and disability pensions by 5 percent above inflation.
A former TV pundit, Milei came to power promising "shock therapy" for Argentina's long-ailing economy, revving a chainsaw as a symbol of his plan to slash state spending.
He cut 53,000 public sector jobs, froze public works, cut spending on health, education and pensions, and led a major deregulation drive.
His reforms produced spectacular results on the inflation front – annual inflation fell from 211 percent at the end of 2023 to 33.6 percent currently – but caused a sharp downturn in growth and consumption.
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Argentina plunged into recession as Milei's government imposes drastic budget cuts
Economists are now also warning that a heavily-overvalued peso is damaging Argentina's competitiveness.
(FRANCE 24 with AFP)
Economists are now also warning that a heavily-overvalued peso is damaging Argentina's competitiveness.
(FRANCE 24 with AFP)
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