The Barcelona city government presented its budget plan for the special year 2023 on a Friday, since municipal elections are scheduled for May 28, a mid-year vote that could prompt six months of interim financial management. The next council, and potentially a new mayor after 2015, looms, making it common for budgets to be extended when elections approach so agreements with opposition groups can be tough to secure.
Still, work had to be done to secure a deal among government partners Barcelona en Comú and PSC before widening talks with other parties in the plenary session. A key point that moved negotiations was the terrace tax, currently at 75 percent. The Socialists preferred to keep it unchanged, while the partners argued for a reduction, which would relieve restaurateurs. In the end, PSC prevailed, and the bonus remains as it is.
Anticipating the crisis
The budget and the rules around it stand out in the plan. The 2023 accounts total 3,595.9 million euros, about 5.6 percent higher than the current year, according to the figures released this Friday. The proposal was unveiled by Jaume Collboni, the first deputy mayor and leader of the Socialists on the council; Jordi Martí, the deputy mayor for culture and the budget commissioner, and Montserrat Ballarín, undersecretary of the treasury, also spoke.
Asked for Barcelona en Comú’s view on the terrace bonus, Martí used a Florentine metaphor to summarize the internal negotiations: once an agreement is reached, it is accepted.
The commune allies feel the terrace share could partly or fully rebound as restoration activity recovers with the return of tourists to the Catalan capital. By the committee outcome, however, they failed to push their own stance against PSC, which argued that removing the bonus amid a pay freeze would slow the recovery and hit an industry already stressed by the crisis. The downturn triggered by the pandemic had briefly halted consumption.
Collboni stressed that the budgets for this term, and especially the ERC, show willingness to negotiate with the opposition, though not solely with the Republicans. In parliament he reached out to PSC for a budget deal, and Ernest Maragall, the opposition leader of the Republican group, was encouraged to respond similarly.
He noted that the city plan aims to anticipate a relatively clear crisis scenario for now, linked to high inflation and soaring energy costs. “There is deep economic uncertainty, and the budget should offer certainty and peace of mind,” he said. “Financial pressure will not rise.”
Freeze
On terraces and fiscal arrangements in general, Ballarín highlighted a preference for a deliberate pause on taxes and fees. To ease payments, any resident—rather than businesses—who must settle more than two municipal charges can spread them over ten months with a fixed rate. That system requires a simple, flat approach.
Martí indicated that this year the project will go through the committee in October rather than November as in past years. “That gives us two months for negotiations.” The mayor hinted at friction between the Catalan government partners as a factor shaping the talks, noting that a deal in Parliament and the council, as happened last year, remains a possibility. It has not been ruled out yet.
“It’s better to reach a budget agreement than not,” he asserted. The positive note is that there has been agreement in Congress, the Catalan chamber, and the city council, he emphasized. He also referred to recent years as evidence that there can be an accord with the opposition.
Evolution
Martí revisited how the city’s budget has evolved since 2015 when Barcelona en Comú took charge of the local government. From the initial budget figure to a forecast for next year, the numbers show a significant shift. The 2015 plan stood at 2,550 million, about 1,000 million less than the proposed 2023 budget. The investment program for 2015 was 374 million and is projected at 759 million in this plan. The 2015 budget represented 3.5 percent of the city’s GDP, rising to 4 percent in the 2023 proposal.
The councilor shared some specifics of the 2023 plan. Revenues increase by 190 million, with 112 million from state contributions and 30 million from a rise in tourism tax collections. Non-financial expenditures grow by 227 million, or 6.9 percent. In personnel, the rise reaches 28.7 million, largely due to the addition of around 1,000 City Guard officers during the term.
Financial expenses climb from 15.8 million to 21 million due to debt incurred by the deficit in the last two years. No additional openings are planned for the year. The city’s debt hovers around 800 million, about 30 percent of current revenue. Martí notes that this share is acceptable, but warns that a rise to 60 percent would be alarming.