“The size of Spain’s public administrations is crazy,” says BDL CEO Santos-Ruiz


CEO of Madrid-listed Barón de Ley, Eduardo Santos-Ruiz had in an interview with The Corner harsh words for the lack of reform of state organisation in Spain. Santos-Ruiz accepts that austerity measures need hit aspects of the country's economic system that require change, but despairs at the volume of the public administrations.

kjhAusterity, is it inevitable? Is it the right thing to do?

I just think some important measures are missing. Yes, we have a labour market reform, several reforms more over the financial industry, but I am still waiting for the big reform of the public administration and the regional network. All these chains of institutions, provincial governments, autonomous governments, twice or three times more politicians on public payroll than in Germany, hundreds of embassies… the sheer size of the state is just crazy, impossible to understand.

It is a matter of survival to cut it down, a matter of responsibility, that all concerned come together in agreement. The fact that they don't do so generates mistrust and anguish: are they aware of their duty?

Do you share, as a company CEO, the growing worry about Spain's regional government structures?

We have a terrible problem here, with the regions, that must be tackled because it is inevitable that the size of the state ends cut. [Governor of the European Central Bank] Mario Draghi said that it is necessary to reduce spending instead of adding taxes, it's just common sense.

The government has to balance the public accounts, but where the scissors should freely run is in reducing the regional administrations. Spain is a decentralised country, but decentralisation should be lighter.

The talk of harmonising the Spanish market is gaining momentum. Does BDL ressent regional rules?

Each region has generated its own bureaucracy, which acts as a barrier for all economic activity, really. Everything is difficulties, restrictions… What is the logic of it all? We need a more unified market, indeed.

I guess you favour further Brussels intervention in euro zone countries, then.

Absolutely, having a monetary union with no political union isn't just a complicated affair but an impossible one. We've had a common currency area in which everybody has behaved independently and in different directions. If we want the euro to succeed, we should evolve into a some sort of federation or the euro will fail.

Has the euro been good for Spain?

It's been excellent. It has given us stability, strength, prestige to open new markets. The common area has eased our presence in Europe, where in the UK or the US their currencies introduce costs to our exports. I believe the majority want to keep the euro.


About the Author

The Corner
The Corner has a team of on-the-ground reporters in capital cities ranging from New York to Beijing. Their stories are edited by the teams at the Spanish magazine Consejeros (for members of companies’ boards of directors) and at the stock market news site Consenso Del Mercado (market consensus). They have worked in economics and communication for over 25 years.