UPDATE 1-Puerto Rico governor announces $1.4 billion budget cut

martes 29 de abril de 2014 18:49 GYT

(Updates throughout with details from speech, adds announcement)

SAN JUAN, April 29 (Reuters) - Puerto Rico's governor announced a $1.4 billion cut in public spending on Tuesday as the commonwealth government agencies braced for measures that will be taken to produce the first balanced budget in years.

Governor Alejandro Garcia Padilla unveiled his $9.64 billion budget proposal for 2015 in an address to the legislature that included a $775 million payment for Puerto Rico's long-term debt.

The current general fund budget is $9.835 billion for fiscal year 2014, which runs through June 30.

"We are beginning to pay for today's expenses with today's earnings. This balanced budget complies with my commitment to prepare a budget without deficit financing nor refinancing of debt," the governor said.

"We have accomplished this without firing anyone, respecting the daily bread of public workers," the governor said.

The governor said that he would cut government spending by an average 8 percent and would freeze hiring but added he would not make cuts to the Police Department or the University of Puerto Rico.

The governor also announced the fusion of 25 government entities, which he said would be undertaken without affecting services or employee rights. He also said he ordered a 10 percent cut in the budget for senior executive staff positions and for professional service contracts.

The government will also seek savings of $236 million in government payroll expenses through negotiated cuts in marginal employee benefits, as well as transferring school transportation service to island municipalities. Officials also said the least utilized and most obsolete schools would be shut down to save money.   Continuación...