VZCZCXRO1846
OO RUEHCD RUEHGD RUEHHO RUEHMC RUEHNG RUEHNL RUEHRD RUEHRS RUEHTM
DE RUEHME #1006/01 0971643
ZNR UUUUU ZZH
O 071643Z APR 09
FM AMEMBASSY MEXICO
TO RUEHC/SECSTATE WASHDC IMMEDIATE 5964
INFO RUEHXC/ALL US CONSULATES IN MEXICO COLLECTIVE PRIORITY
RUEATRS/DEPT OF TREASURY WASHINGTON DC
RUCPDOC/DEPT OF COMMERCE WASHINGTON DC
RUEHC/DEPT OF LABOR WASHINGTON DC
RHMFISS/DEPT OF ENERGY WASHINGTON DC
RHMFIUU/CDR USNORTHCOM PETERSON AFB CO
RHMFISS/CDR USSOUTHCOM MIAMI FL
RHEHAAA/NATIONAL SECURITY COUNCIL WASHINGTON DC

UNCLAS SECTION 01 OF 03 MEXICO 001006 
 
SENSITIVE, SIPDIS 
 
STATE FOR WHA/MEX, WHA/EPSC 
STATE FOR EB/IFD/OMA - ALEX WHITTINGTON 
TREASURY FOR IMB B MURDEN, W MONROE AND M BEASLEY 
 
E.O. 12958: N/A 
TAGS: ECON EFIN MX
SUBJECT: MEXICAN BUDGET AND INFORMATION TRANSPARENCY 
LAWS SET HIGH STANDARD 
 
¶1.  (SBU) SUMMARY.  The access to information law passed in 
2002 represents a vital element of the country's democratic 
transition and set a new international standard for 
transparency legislation.  The new budget and fiscal 
accountability law passed in 2006 also represented a 
considerable improvement for assessing fiscal practices. 
This law forced all government agencies to release 
significant information, such as their budgets -including 
income and expenditures-, audits to the budget conducted by 
the agency, independent auditors or the Congress.  This 
information is available in the Finance and Public Credit 
Secretariat's and in each of the government agencies' Web 
pages.  The law also requires the government to issue 
monthly and quarterly reports on its revenues and 
expenditures to the Congress and imposes sanctions to those 
government officials who fail to provide the information or 
who spend public resources ineffectively.  The challenge for 
Mexico now is to continue cultivating a culture of openness 
and ensuring that transparency laws are fully and properly 
implemented.  End SUMMARY. 
 
TRANSPARENCY LAW OPENS PUBLIC FILES TO THE PUBLIC 
--------------------------------------------- ---- 
 
¶2.  (SBU) Although former National Action Party President 
Vicente Fox failed to pass broad structural reforms -energy, 
fiscal, labor, etc- during his tenure, he succeeded in 
advancing transparency in Mexico.  In 2002, Fox issued a new 
Transparency Law aimed at increasing the government's 
accountability before its citizens by providing them with 
information never released to the public before.  The law 
forced all government agencies and Secretariats to release 
significant information, such as their budgets, including 
incomes and expenses, audits to the budget conducted by the 
agency, independent auditors or the Congress, government 
officer's salaries, goals, organizational charts, etc. 
 
¶3.  (SBU) This information is available in each government 
agency webpage under the field 'Webpage of Transparency 
Obligations'.  The law created the Federal Institute for the 
Access to Public Information, which was charged with 
processing the public's requests.  The law only forbids the 
release of classified information when it jeopardizes 
national security, international negotiations, economic and 
financial stability, or criminal and judicial cases. 
 
CONSTITUTIONAL OBLIGATION TO RELEASE INFORMATION 
--------------------------------------------- --- 
 
¶4.  (SBU) The Congress approved in 2007 a new paragraph to 
article 6 of the Mexican Constitution in order to give 
access to public information to anyone interested in 
obtaining it.  This article states that all the information 
owned by the federal, state and municipal governments is 
public and that it can only be temporarily reserved for 
reasons of public interest.  The agencies that fail to 
provide information to the public will be sanctioned 
according to the law. 
 
¶5.  (SBU) The amendment was a significant step forward in 
terms of acknowledging the fundamental right to gain access 
to public information.  Although this reform was a positive 
step in the right direction, observers opine that a second 
generation of laws is needed to open the government's 
information even further, such as expediting the process to 
provide the information to the public, improving the quality 
of the information provided through the Internet, including 
more detailed information, explaining in detail the 
government's performance indicators and how they are 
measured, as well as aligning local governments' standards 
to the Constitution and transparency law. 
 
IMPROVEMENTS IN BUDGET TRANSPARENCY & ACCOUNTABILITY 
--------------------------------------------- -------- 
 
¶6.  (SBU) On March 30, 2006 the Executive issued in the 
Official Gazette the new Federal Budget and Fiscal 
Accountability Law to replace the old budget law enacted in 
¶1976.  Among other things, the law set new accounting rules 
and a catalogue of budgetary items, as well as transparency 
 
MEXICO 00001006  002 OF 003 
 
 
and accountability criteria.  The new law included 
mechanisms to measure the government's performance and 
established sanctions and responsibilities for government 
officials.  A new budget law which included transparency and 
accountability criteria was required to force the government 
to make an efficient use of public resources and to make it 
accountable for any misuse of public funds.  It is also 
aimed at ending discretionary spending by including 
performance indicators. 
 
¶7.  (SBU) The Federal Budget and Fiscal Accountability Law 
includes a whole chapter -Title V, articles 106 thru 111 
about transparency, reporting and evaluation of public 
expenditures.  Article 106 establishes that the management 
of public funds should comply with the provisions set in the 
Federal Transparency and Access to Information Law.  Article 
107 in particular mentions the Executive's obligation to 
submit a monthly and quarterly report to the Congress, and 
which basically includes the following: 
 
--Economic situation and public finances 
--Tax and non-tax incomes, oil-related and non-oil related 
incomes 
--Programmable and non-programmable expenditures 
--Public debt 
--Contingent liabilities and financial requirements 
--Advancement or achievement of goals and their social 
impact 
 
In addition to the Congress' supervision, the Secretariat of 
the Public Function verifies every two months the evolution 
and results of the government's income and expenditures. 
 
¶8.  (SBU) The Federal Budget is divided in the Revenues or 
Income Law, which has to be approved both by the Chamber of 
Deputies and the Senate, and the Expenditures Law, which is 
approved by the Chambers of Deputies only.  Both laws are 
published in the Official Gazette 20 days after being 
approved by the Congress.  As mentioned in paragraph 7 the 
Executive sends monthly and quarterly reports to the Federal 
Superior Auditor, the Congress' supervision and control 
entity. 
 
INFORMATION INCLUDED IN THE GOVERNMENT'S FINANCIAL REPORTS 
--------------------------------------------- --------- 
 
¶9.  (SBU) These reports can be found in the Finance and 
Public Credit Secretariat's webpage: www.shcp.gob in the 
Public Finances field.  The report includes charts with 
information on the fiscal balance, surplus or deficits, 
income, expenditures, domestic and foreign debt, and an 
explanation on the performance of each item, as well as a 
comparison with the previous year.  The Public Sector's 
Programmable Expenditures are presented in a separate chart 
divided by Secretariat and government goal's, such as the 
item of interest to us in this cable "Orden, Seguridad y 
Justicia" (Order, Security and Justice).  It also includes 
expenditures and percentage of evolution of the government's 
main programs, such as the program to implement raids or 
operations for criminal detention and crime deterrence. 
 
¶10.  (SBU) Detailed information, such as expenditures on 
equipment, vehicles or uniforms for the police is more 
difficult to obtain, but still available (Note:  The links 
are hard to find if one does not know exactly where to look 
for information. End Note.  In the Finance and Public Credit 
Secretariat's webpage, in the 'Expenditures' field, 
information about allotted and spent resources compared to 
the previous year on government program's such as Plataforma 
Mexico or the fight against small-scaled drug dealing can 
also be found, but only for 2007 and previous years. 
 
¶11.  (SBU) Information on income and expenditures can also 
be found in each of the government's Secretariats or 
agencies.  The new catalogue of expenditures approved by the 
Congress in 1997 and reported by each agency includes the 
following items: 
--Personal services (salaries and allowances) 
--Materials and supplies (tools, uniforms, paperwork, etc.) 
--General services (contracts, purchase orders, etc.) 
 
MEXICO 00001006  003 OF 003 
 
 
--Subsidies and transfers to states and municipalities 
--Property (buildings, vehicles, equipment, furniture, etc.) 
--Public works 
--Financial investment 
 
¶12.  (SBU) COMMENT:  The Mexican government's political will 
during the past two administrations to promote transparency 
and accountability is highly commendable and resulted in the 
creation of two new laws aimed at fostering the right to 
know and making government officials accountable for their 
acts.  The challenge for Mexico now is to continue 
cultivating a culture of openness and ensuring that 
transparency laws are fully and properly implemented.  The 
government's general income and expenditures information on 
public programs can be easily obtained in the Internet, 
through the Mexican equivalent to the U.S. Freedom of 
Information Act, and via a direct request to the Embassy's 
contacts in the government.  Very detailed information on 
the government's income and expenditures on a particular 
program is relatively accessible.  Perhaps the government 
could improve its mechanisms to let the public know where 
exactly to search for the information thus making these 
details more easily accessible to the public. 
 
Bassett