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The People’s Party blocks redistributing the deficit targets among government levels in 2012 and 2013

Catalonia and the Autonomous Communities run by the Socialist Party (PSOE) were asking to make the Spanish Government’s deficit targets stricter and to proportionally relax those of the Autonomies. The Spanish Prime Minister Rajoy and the Autonomies run by the PP have opposed this redistribution, which would have transferred part of the flexibility allowed by Brussels to the Autonomies. In fact, when Brussels relaxed Spain’s deficit targets for 2012 and 2013, the Spanish Government did not share this flexibility with the Autonomies, which are responsible for almost 40% of the public spending and the managing of the Welfare State services. On the contrary, it made the Autonomies’ deficit targets stricter for 2013.

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03 October 2012 01:50 AM

by

ACN

Madrid (ACN).- On Tuesday, a formal meeting with all the Presidents of the 17 Autonomous Communities and the Spanish Government took place in the Spanish Senate. It was the so-called \u201CConference of Presidents\u201D, the fifth time it has taken place, in 34 years of democracy. The Spanish Prime Minister Rajoy and the Autonomies run by the PP blocked the redistribution of the deficit targets among government levels in 2012 and 2013. Catalonia and the Autonomous Communities run by the Socialist Party (PSOE) were asking to make the Spanish Government\u2019s deficit targets stricter and to proportionally relax those of the Autonomies. The measure would have transferred part of the flexibility allowed Spain by the European Union to the Autonomies, sharing this flexibility among all government levels. However, when Brussels relaxed Spain\u2019s deficit targets for 2012 and 2013, the Spanish Government did not share this flexibility with the Autonomies, which are responsible for almost 40% of the public spending and the managing of the Welfare State services. On the contrary, it made the Autonomies\u2019 deficit targets stricter for 2013, falling from the foreseen 1.1% to 0.7% of their GDP. By 2014, the Autonomies would have to have their budgets almost completely balanced, as the deficit target imposed is 0.1%. However, the Spanish Government, responsible for 50% of the public spending in Spain, has allowed itself a 3.8% deficit in 2013 and a 2.7% deficit in 2014. The meeting issued an institutional declaration in which the participants promised to study the revision of the deficit targets for 2014, but not those for 2012 and 2013.


The fifth \u201CConference of Presidents\u201D, the first one with Rajoy as Prime Minister, came less than four weeks after the 1.5 millions strong demonstration in Barcelona asking for Catalonia\u2019s independence and the Spanish Prime Minister\u2019s refusal to negotiate a specific fiscal agreement with Catalonia, similar to that of the Basque Country and Navarra. According to the Spanish Prime Minister, the meeting dealt with the fight against the economic crisis and with meeting the deficit targets. The two subjects concerning the entire organisation of the Spanish State were not discussed at the meeting, stated Rajoy in a press conference. Despite not discussing those subjects, the conference showed images of tension between the members of the Spanish Government and the President of the Catalan Government, Artur Mas. In fact, as proof of the cold atmosphere between both governments, the Catalan President announced a few days ago that he would assess the conference once back in Barcelona, holding a press conference the morning after the meeting.

The Autonomies have undertaken 70% of Spain\u2019s deficit adjustments while they represent 39% of the public spending

Catalonia has insisted on sharing the flexibility given by the European Union to Spain among the different government levels, doing so in a proportional way. In fact, the Catalan President has claimed on several occasions that the Autonomous Communities are assuming the largest part of the deficit adjustment. According to Mas and other President, this is not \u201Cfair\u201D. As Mas stated on Monday, despite the fact that the Autonomies represent 39% of Spain\u2019s entire public spending, they are undertaking 70% of the budget adjustment. This necessarily and dramatically hits basic services, since the Autonomies exclusively manage the public healthcare network, the school system and most of the social policies. Therefore, in order not to damage public services and the Welfare State, Catalonia and the Autonomous Communities not run by the PP asked the Spanish Government to proportionally share the deficit targets. The claim was opposed by the PP as a block.

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