• At Rumbo a PERUMIN, the alternatives to improve public spending across our territory were presented, along with the related problems the country faces.

The prospective planning of development, the migration to more efficient spending mechanisms focused on results, and the implementation of a meritocratic public service career in sub-national governments with more resources were the three proposals for increasing impact across the territory, made by Milton von Hesse, an economist and director of Videnza Consultores.

During his presentation on the third day of the event Rumbo a PERUMIN “Territorial Development: A Challenge to Closing Social Gaps,” he analyzed tax revenue spending coming from mining on the development of people and their territories, in alignment with the concept of territorial development—a work approach proposed  by the mining industry.

“The development of proposals clearly identifies strategic objectives and gaps, and correctly maps their identifiers and the projects around them. This will enable us to define, measure, identify, modify, and achieve proper development of the territory,” explained the economist.

Von Hesse also mentioned that the special public investment projects (PEIP) should be implemented, since they enable us to engage highly trained staff and use modern contractual models, among others. Moreover, an approach at a service level should be prioritized, as the population, budget, and specialized operators that are to provide the service have already been defined.

“We must have competent public officials. According to SERVIR, under 10% of State servants have optimal qualifications to do their job. It is, therefore, essential that public service careers be based on meritocracy so that we can have trained workers that do their job competently,” added the director of Videnza.

The Spending of Transfers Is Not Optimal

The also former minister of Housing, Construction, and Sanitation noted that between 2004 and 2022, mining generated a total of PEN 79 billion as canon (fiscal redistribution) and royalties for regional and local governments. Yet, these economic resources were not properly used. This, added to the lack of transparency, prevented the population living in mining areas from improving their quality of life.

“A clear example is the district of Yarabamba, in Arequipa, considered the third richest district in Peru. To paint a clear picture, this district has a stadium for sports events but does not have drinking water. That is why we need to prioritize those urgent services that the population demands,” he added.

Finally, Von Hesse said that the lack of territorial approach to development, coupled with a rather ineffective and inefficient budget spending and co-ordination among government levels (district, province, and region), will not allow us to have an adequate plan focused on generating development for the population.

Rumbo a PERUMIN

Rumbo a PERUMIN is an initiative of the Peruvian Institute of Mining Engineers (IIMP) and the Executive Committee of PERUMIN 36. It involves an agenda of virtual activities that seek to create spaces for analysis, knowledge and debate on mining.