Argentina’s Congress Approves Milei’s Omnibus Law

The Congress of Argentina has approved President Javier Milei’s Law Bases and Points of Departure for the Freedom of the Argentines, popularly known as the Omnibus Law. This legislative package comprises a series of laws aimed at deregulating the economy, minimizing the role of the State and favoring capital and private initiative. This represents a first political victory for the Argentine head of state, who has been in office since last December.

More than 24 hours of parliamentary debate were necessary to finally obtain the political support necessary for approval. However, the law is being voted by chapters in a version reduced to one third of the first document, after a first failure of the original text which had more than 600 articles.

In the fiscal section, the restitution of income tax and the laundering of capital were the two most outstanding aspects of this package promoted by the government. Now, the next step before it becomes final is for it to be endorsed by the Senate.

President Milei’s first success in the legislature

With 142 votes in favor, 106 against and 5 abstentions, the bill popularly known as the Omnibus Law was approved, after months of debate in the Argentine Congress, where it had so far failed to achieve sufficient support. In the end, a reduced and less forceful version obtained sufficient votes from the deputies, after the failure of the original text in February.

The law still retains the spirit of reducing the role of the State in the economy, favoring private initiative. The ruling party had to engage in extensive negotiations with different political blocks for the law to go through.

Within this package of laws, the labor reform was also approved, after being vetoed at first by the country’s judiciary, at the request of the unions. This amendment to the labor legislation modifies the labor contract law by extending the probationary period from three to six months, and allows collective bargaining agreements to extend it up to eight months and up to one year, depending on the size of the company, which saves severance pay.

A controversial chapter was the creation of a “severance fund”, which makes it possible to replace severance pay with a severance system, which may be private, to cover the payment for termination without objective cause.

The law also allows reducing pregnancy leave prior to childbirth to ten days and accumulating the remaining 80 days after childbirth. Likewise, it increases the indemnity for a dismissal motivated by a discriminatory act.

Privatization of Argentine public companies

In addition, the parliamentary session approved the granting of legislative powers to the Executive Branch for one year in four areas, including economic and administrative matters. A reform of the State was authorized, giving approval to the privatization of up to ten public companies, among them the emblematic Aerolíneas Argentinas and public radio and television.

The privatization of public utilities, railroads and postal services was also authorized. In order to obtain the votes of the deputies, the government was forced to remove the oil company YPF from the list of companies to be privatized. Also excluded were Nation Bank and its subsidiaries and the state-owned news agency Telam, threatened with closure by the government and with 700 workers suspended.

Initially, the list of public companies that the government requested to privatize was 41. With the legislative agreement, 11 will finally be taken into private hands.

Political reactions

For the opposition, the day was described as a “disastrous day” for Argentina. This was pointed out by the Governor of Buenos Aires, Axel Kicillof, who assured that this is not a legislation for the “re-foundation” of Argentina. “Today is a tragic day, because of what happened in the Chamber of Deputies. But it is the first half of the game, the other half is missing and we have to start working right now so that this does not become a law”, said the provincial president in an interview with the news channel C5N.

The opposition politician made a call to reject the law in the Senate. “The Senate has to reject Milei’s Law of Bases. It is a law that institutionalizes the desertion of the National State from its most elementary obligations, that enshrines privileges, damages rights, resigns sovereignty and deepens inequality”, Kicillof wrote in a long comment in social networks.

On the official side, the Minister of the Interior, Guillermo Francos, defended the measure. “It was a very great effort where there was a debate at the highest level”, affirmed the minister, who added that “two laws that will have a great importance in the future of the Argentines if the Senate ratifies it” were sanctioned.

Francos assured that this law “is a first step to promote the growth and development of our country”, and at the same time he appealed to the Senate to ratify what he defined as the “central pillar for the resurgence of Argentina”.