Spanish government meets the regions to set specific deficit targets

Spanish regions

By Tania Suárez, in Madrid | On Tuesday afternoon, July 31, the Council for Fiscal and Financial Policy (CPFF by its Spanish initials) will meet the central government in order to establish the deficit target and debt levels of each region in Spain for 2013. It is expected that the regions will adapt themselves to the general targets, which marked a mutual deficit of 0.7% for 2013, 0.1% for 2014 and a surplus of 0.2% for 2015.

The minister for the Treasury and Public Administrations Cristóbal Montoro will chair the summit. Apart from establishing the deficit and debt limits, the Council and the Spanish central government will study particularly the situation of those regions that have been supervised by the ministry and which are at risk of non-compliance with deficit targets.

The main difference to previous meetings is the change in the posture of most of the regions: whereas in the last meeting two regions governed by Partido Popular (same political party than the Spanish government) abstained, it is foreseeable that now all the regions belonging to Partido Popular will vote in support of the government.

Soraya Sáenz de Santamaría, vice-president of the Spanish cabinet, said last Friday that they are analysing the compliance with the regions’ adjustment plans, so that they can plan the possibility of new measures before any region fails to meet the targets. According to the vice-president,

“The ministry for the Treasury and Public Administrations is now analysing all the regional adjustment programmes. When and if new measures are adopted, they will be made public. As the regions rectify or comply with their obligations, the Council for Fiscal and Financial Policy shall take charge.”

This summit will take place a day after the president Mariano Rajoy talked to the territorial barons of his political party (i.e. the bigshots of the Spanish regions). Together, they looked into the economic situation of Spain and its regions, and they tried to send a clear and unitary message about the austerity measures carried out by the government. The question is: will all this bureaucratic paraphernalia bring a successful conclusion? Everyone is waiting.

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.

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