The Council of Government adopts the PLF 2021

Mohamed BENCHAABOUN, Minister of the Economy, Finance and the Reform of the Administration.

The Government Council held a meeting on Friday October 16, 2020, during which the Finance Bill for the 2021 budget year was approved.

Lhen said council, the Minister of the Economy, Finance and Administration Reform 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 High Directives Roychosen contained in the Speeches of His Majesty the King, may God assist Him, and within the framework of which the 2021 Finance Bill is part.

A 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 reflecting a strong commitment for a promising and inclusive recovery for the post-COVID-19 crisis period. These orientations are based on the following three axes:

Axe I : Accelerating the launch of a national economy recovery plan 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, in particular, of micro-enterprises 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 and game parks. The aim is to breathe new life into these sectors and to preserve jobs;
  • A Special Trust Account has been created, to which His Majesty the King, may God assist Him, has assigned the name of “Mohammed VI Fund for Investment”, and which will be endowed with 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.

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 coverage. It will be accompanied by:

  • The revision of the legal and regulatory framework which governs Compulsory Health Insurance, namely Law 65-00 on the code of basic medical coverage and Law No. 98-15 relating to the compulsory basic 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 approximately 20 billion dirhams will be allocated to the health sector for the year 2021, in addition to 5,500 budget items ;
  • Simplification of 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”.

Axe III : Strengthening the basis of the exemplary nature of the State and optimizing its functioning through the initiation of a reform of Public Establishments and Enterprises (EEP) which aims to make their missions consistent and to improve their economic and social efficiency. This will happen, in particular, by:

  • 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 PECs 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.

A also note that the Finance 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 18,000 budget items.

A At the end of his presentation, the Minister specified 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, growth economic should be at 4,8% in 2021. Moreover, in view of the efforts to be made in terms of 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 assets government, the Treasury deficit will be reduced to 6,5% of GDP against 7,5% in 2020.

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