Politics

Unemployment in Catalonia dropped by 15,356 in June, leaving the total number of people registered as being unemployed at 615,576 individuals. It is the fourth consecutive month that the number of people registered as unemployed dropped in Catalonia. In the whole of Spain, unemployment also decreased last June. By the end of June there were 98,853 fewer people registered as unemployed throughout Spain.

Depending on UN-Habitat, the Global Water Operators' Partnerships Alliance (GWOPA) has established the Catalan capital as the permanent base for its headquarters. GWOPA will set up its offices in one of the historical Art-Nouveau pavilions of the old Sant Pau Hospital, in Barcelona. These pavilions will host other international organisations, such as one institute of the United Nations University. “It is not the first and neither will it be the last organisation to choose” Sant Pau’s historical site to base its headquarters, stated the Catalan Minister for Sustainability, Lluís Recoder.

A new poll by the Centre of Opinion Studies shows that, for the first time in history, Catalans prefer independence to any other political arrangement with Spain.

The President of the Catalan Government, Artur Mas, travelled to Massachusetts and New York to promote Catalan businesses and present Catalonia as one of the main biotechnological clusters and tourist destinations in Europe. In addition, Ernst & Young presented their report on life sciences companies and research centres in Catalonia, which indicates that almost 30% of this sector’s turnover in Spain comes from Catalan businesses.

The Catalan Government’s debt represents 21% of Catalonia’s GDP, and it is in charge of almost half of public spending and manages healthcare, education and other basic services. Catalonia’s debt continues to increase because of the public deficit, but slows down its growth significantly. Over the first quarter of 2012, the Catalan Government’s debt increased by €222 million, while it had grown by €2.34 billion over the same period in 2011. With this last increase, the Catalan Government’s debt reached €42 billion at the end of March 2012.

On Tuesday the Catalan Council for Constitutional Guarantees (CGE) declared that the Spanish Government decree cutting €3 billion in education does not respect 2 Constitution articles and 5 other articles from Catalonia’s Statute of Autonomy, being thus unconstitutional and going beyond Madrid’s jurisdiction. The Catalan Government following the CGE’s unconstitutionality assessment decided to bring the education decree to the Constitutional Court(TC), as it did last week with Rajoy’s health decree. However, after the Spanish Government threatened to bring approved initiatives from the Catalan Executive to the TC, the Catalan Government decided to modify the decrees through dialogue and bring the decrees to the TC as a last option.

Following the advice of the Catalan Council for Constitutional Guarantees (CGE), the Catalan Executive will appeal the Spanish Government’s decree to save €7 billion in healthcare this year. However, it will continue implementing the decree until a judicial decision is made. According to the CGE, the decree violates 3 Spanish Constitution articles and 3 others from the Catalan Statute of Autonomy. The decree does not guarantee equality among all citizens, since it limits access to public healthcare. In addition, it invades the Catalan Government’s powers. Left-wing Catalan parties were the first to ask for CGE’s opinion, since they consider the new decree violates basic social rights.

There were 630,932 people registered as unemployed with the Catalan Public Employment Service. It is the third consecutive month with an unemployment drop. In Spain, unemployment decreased by 30,113 in May, leaving the total number of people without a job and looking for a new position at 4,714,122. In absolute terms, Catalonia is among the Autonomous Communities where unemployment decreased the most in May.

The Spanish Finance Minister, Cristóbal Montoro, presented the budget data from January to March 2012. The Autonomous Community Governments together had a 0% deficit in this period. Among them, Catalonia’s had a 0.45% budget surplus, while in the same period of 2011 it had a 0.65% deficit. Montoro emphasised that the data shows “the big effort” the Autonomies are making.

The President of the Catalan Government has organised a summit with all the parties at the Catalan Parliament to discuss a new fiscal scheme for Catalonia. According to official studies, Catalonia gives 8.5% of its GDP each year to pay for investments and services in the rest of Spain, an amount that represents more than €17 billion per year. Some parties state that the current model is unsustainable for Catalonia and represents a plundering of its finances. Others have a more moderate opinion. Nonetheless, all political parties in Catalonia now believe that this amount is excessive and that the fiscal scheme between Catalonia and the rest of Spain should be reviewed. However, they significantly disagree on the formula and the timing.

The Catalan Government’s finances corresponding to the first four months of 2012 showed a €535 million budget surplus. Spending has been reduced by €240 million in comparison to the same period last year, when the Catalan Government’s budget had a deficit of €1.13 billion. The budget surplus is mostly due to the transfers made by the Spanish Government, which partially correspond to payments from 2010.

Using its absolute majority, the People’s Party (PP) has approved the Spanish Government’s budget for the current year refusing 3,100 amendments from the opposition. Only 3 minor amendments from the opposition parties have been accepted. The budget does not respect the current legislation, which obliges to guarantee a minimum investment percentage to be made in Catalonia in order to compensate for an historical lack of money being put into the Autonomous Community. According to Catalan law, approved by the Spanish Parliament, Catalonia should receive at least 18.66% of all the territorial investment made throughout Spain; however it only receives 11.04%.

Esperanza Aguirre, one of the main representative from Spanish Nationalism, has asked to postpone the game or playing it in an empty stadium in order to avoid supporters whistling and booing the Spanish National anthem and Prince Felipe, as was the case in 2009. This season’s Spanish Cup Final will be decided in Madrid between FC Barcelona and Athletic Club of Bilbao, a Catalan and a Basque team. Catalan politicians have criticised Aguirre for mixing football and politics. CiU and the PSC have coincided in pointing out that Aguirre is ready to talk about the Cup Final but not about Madrid’s public deficit deviation. Besides, an extreme-right demonstration in Madrid organised on the same day has been authorised.

The Catalan Government will adjust its budget by €4.295 billion in 2012, through spend cuts of €2.680 billion and increasing revenue by €1.615 billion. With this plan, the Catalan Government will meet the 1.5% deficit target. The Council of Fiscal and Financial Policy (CPFF), which brings together the Spanish Government and the 17 Autonomies, has approved Catalonia’s budget adjustment plan for 2012-2014. The Spanish Government would pay part of the money owed, but not all of it. The Catalan Government has included a plan B in case the Spanish Government does not honour its fiscal obligations towards Catalonia.

The third plan represents an additional budget cut of €1.5 billion, in order to meet the 1.5% deficit target for this year. The President of the Catalan Government, Artur Mas, said that the plan “guarantees essential services”. He also stated that if the Spanish Government had paid what it owed last year, the current reduction would be halved. The plan decreases budget allocations for public companies, reduces public employee salaries once again, decreases the amount allocated for subsidies, delays investments, privatises some public companies, sells public buildings, and implements the measures decided by the Spanish Government regarding health and education. The opposition criticised the plan for not being concrete and effective enough.