Peru Constitutional Court bars Congress from initiating public spending

Peru's Constitutional Court (TC) issued a ruling (expediente 00018‑2023‑PI/TC) that reaffirms the executive's exclusive competence to initiate public spending. The Court declared that “la iniciativa de gasto, como regla general, es una competencia del Poder Ejecutivo para la administración de la hacienda pública,” and that congressional bills that would increase expenditures must be coordinated with the Executive and meet strict constitutional requirements. These include identifying the financing source, obtaining a fiscal‑sustainability report from the Ministry of Economy and Finance, and prioritising basic social needs. The decision overturns the earlier “Belén” precedent that had allowed Congress a broader role in budget‑impacting legislation. An exception is maintained for urgent social priorities such as health, education or basic services, provided coordination with the Ministry occurs. The ruling stems from a challenge to Law 31232, which modified a law on the emergency relocation of residents in the Belén district of Loreto. The TC’s interpretation is binding, reshaping the legislative process and aiming to protect fiscal sustainability.