Council of government: PLF 2021 approved

The Government Council, meeting this Friday, October 16, approved the Finance Bill (PLF) for the 2021 budget year.

During this meeting, the Minister of the Economy, Finance and Administration Reform, Mohamed Benchaaboun presented the developments that have marked the national and international context, in particular following the spread of the COVID-19 pandemic. , and the measures taken to deal with it, thus translating the operationalization of the directives contained in the royal speeches, and within the framework of which the 2021 PLF falls.

In this regard, the main orientations adopted for the 2021 PLF, prioritize job creation, support for national companies, generalization of social coverage and reform of Public Establishments and Enterprises, thus translating a commitment strong for a promising and inclusive recovery for the post-COVID-19 crisis period.

These orientations are based on the following three axes:

Axis I: The acceleration of the launch of a plan to revive the national economy which will result in an exceptional financial effort, emphasizing the protection of jobs, support for the cash flow of companies through guarantee mechanisms in favor of , in particular, small businesses and SMEs. In this context:
* A “Pact for economic recovery and employment” was concluded between the State and the private sector to implement a comprehensive and integrated plan for economic recovery;
* Program contracts have also been signed for the relaunch of the tourism, events and catering sectors as well as companies operating in amusement parks and games. The aim is to breathe new life into these sectors and to preserve jobs;
* A Special Assignment Account has been created, to which the King has assigned the name of “Mohammed VI Fund for Investment”, and which will have legal personality. Indeed, the mission of the said fund will be centered around support for production activities, support and financing of major public and private investment projects;
* Public investment has also been strengthened, reaching a global amount of 230 billion dirhams, of which 45 billion dirhams will be mobilized under the Mohammed VI Fund for Investment.

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Axis II: The launch of the generalization of Basic Medical Coverage over a period of two years (2021-2022), as a first step in this large-scale societal reform relating to the generalization of social cover. It will be accompanied by:
* Revision of the legal and regulatory framework that governs Compulsory Health Insurance, namely Law 65-00 on the code of basic medical coverage and Law No. 98-15 relating to the basic compulsory health insurance scheme for the categories of professionals, self-employed workers and self-employed persons exercising a liberal activity;
* The rehabilitation and upgrading of hospital structures. As such, a budget of around 20 billion dirhams will be allocated to the health sector for the year 2021, in addition to 5,500 budget items;
* Simplifying the tax system for professionals with limited income, by establishing a “Unified Professional Contribution”;
* The institution of a social solidarity contribution, which will generate revenue of around 5 billion dirhams. These revenues will be allocated to the “Social Protection and Social Cohesion Support Fund”.

Axis III: Strengthening the basis of the exemplary nature of the State and optimizing its operation through the initiation of a reform of Public Establishments and Enterprises (EEP) which aims to make their missions consistent and enhance their economic and social efficiency. This will include, in particular,:
* The elimination of certain companies or their subsidiaries whose existence no longer fits with the objectives of their creation as well as the regrouping, in large poles, of establishments and companies working in similar sectors. A bill concerning the reform of PCC has been prepared;
* The creation of a national agency whose mission will be to strategically manage the State’s participation in the various PEEs and to assess the performance of public institutions. A bill has been prepared in this direction and will be put on the adoption circuit shortly.

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It should also be noted that the Budget Bill for the 2021 budget year pays particular attention to the education sector, which will have a budget of 72 billion dirhams.

This sector will also benefit from more than 18,000 budget items.

At the end of his presentation, Benchaaboun clarified that through the implementation of the Finance Bill for the 2021 budget year, and based on a set of assumptions relating to the international national environment, economic growth is expected to stand at 4.8% in 2021.

In addition, given the efforts to be made in terms of the rationalization of expenditure and the measures undertaken to obtain additional resources, within the framework of the continuation of the privatization process, innovative mechanisms and dynamic management of the assets of the State, the Treasury deficit will be reduced to 6.5% of GDP against 7.5% in 2020.

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