In the July 23 election program, PSOE already pledged to push for a new regional financing system to be approved within a year at most, meaning in 2024. Today the PSOE-Sumar coalition agreement states that unless this reform occurs, the national budget will guarantee funding for the Valencian Community and for other underfunded autonomous regions, ensuring public services are delivered at the same standard as the rest of the State.
This approach acts as a safeguard should parliamentary fragmentation and competition with the PP slow down reform of a model that is overdue for renewal. Nearly a decade has passed since 2014. The goal is straightforward: promote a new regional financing model that addresses the inadequate funding faced by autonomous communities such as Valencia, a commitment highlighted by the second vice president and leader Yolanda Díaz during the unveiling of the signed legislative accord with Pedro Sánchez.
Sánchez and Díaz have extended the agreement for another four years and are now waiting for partners to call for a shared path
From the Balearic Islands through Catalonia to Cantabria
The Valencian Community is the only region explicitly mentioned in the text of the legislative agreement. According to the latest Ministry of Finance data, the final regional financing solution for 2021 shows adjusted per-capita funding below the average in several communities: Balearic Islands (2,296.63 euros), Canary Islands (2,388.17 euros), Valencia (2,495.87 euros), Murcia (2,627.45 euros), and Andalusia (2,715.64 euros).
Catalonia sits at 2,769.62 euros per adjusted capita, just 0.16% above the average and slightly below Castile-La Mancha (2,787.93 euros).
At the other end, regions with the highest per-capita funding above 3,000 euros include Cantabria (3,533.64 euros), La Rioja (3,272.52 euros), Extremadura (3,093.42 euros), and Aragon (3,036.04 euros). They are followed by Castile and León (2,993.55), Asturias (2,937.44), Madrid (2,887.71), and Galicia (2,863.02 euros).
Unfair tax competition between autonomies
The coalition agreement between PSOE and Sumar contains only a few references to the reform of regional financing. When discussing the new state tax on net assets exceeding three million euros, the so‑called temporary solidarity tax on large fortunes, Sánchez and Díaz commit to evaluating its effects with the aim of moving toward a wealth tax within the regional financing framework to end unfair tax competition between regions.
General references
References to reforming the regional financing system in the PSOE-Sumar agreement are fairly general. The text says that a new regional financing model will guarantee the resources necessary for citizens to access quality public services, emphasizing equality, solidarity, financial autonomy, shared responsibility, sufficiency, and institutional loyalty, with the goal of ensuring equal access to services and correcting underfunding in certain communities.
Similarly broad is the paragraph on reforming local financing. It notes that alongside the Law on Rationalization and Sustainability of Local Government, there will be a reform to establish a competence and financial framework that supports the solvency of municipalities and ensures they provide high-quality public services. It also mentions confirming a Local Government Law that strengthens local autonomy with defined powers so public policies can be developed with guarantees of quality and transparency.