Finance Minister Ruth Merino made her debut yesterday at the Fiscal and Fiscal Policy Council, a forum where heads of public savings banks discuss key fiscal and fiscal issues with the Government. Arcadi España, who attended last year as Minister of Botany and yesterday as Minister of State for Regional Policy, repeated this meeting.
The Valencian Community will receive 15 billion 254 million euros from the regional financing system (SFA) in the next financial year; this is 13.4% more than the previous year, but will be 263 million less in the Generalitat’s budgets than the Executive Carlos Mazón had planned. Preparing these figures without knowing them due to the temporary nature of the Executive after 23-J. This figure was transferred to all regional governments by the central government at the Fiscal and Fiscal Policy Council (CPFF) held in Madrid yesterday, where the return of spending rules was also formalized after a three-year bracket due to the pandemic. war.
As planned, the Government set a deficit of 0.1% of GDP for regional authorities, with the Government moving ahead of the European Union. The Valencian Community and all the autonomies controlled by the PP voted against and demanded that this deficit be maintained, claiming that the distribution of deviations was unfair because the State had reserved 2.9 percent of this deficit (it had committed 3 percent to the EU). current 0.3%.
This new limit could require cuts for the Generalitat, which ignores the budget plan sent to the EU in its 2024 accounts and reflects a deficit of 0.3 percent (in effect in 2023) instead of 0.1 percent. This was an order, not a mistake, because the Consell was aware of the stabilization plan the Government had sent to the EU and chose to launch an attack on the Executive by tripling the allowable deficit between revenue and expenditure. This created an extra cushion of around 290 million in spending that now remains in balance.
The initiative will advance in today’s Cabinet, although all PP-controlled regions voted against it and only Asturias and Castilla-La Mancha (those ruled by the left) supported the path to stability.
However, the PP missed the possibility of stalling his confirmation in the Senate; According to Minister María Jesús Montero, this could have the opposite effect, because in this case the original plan, which envisaged a budget balance (0% deficit), would prevail. The tenth one given to autonomies yesterday. In the case of the Generalitat, this would mean adjusting a further 144 million people, bringing the total number to over 430 million.
As reported by the Ministry of Finance, the Generalitat, which is very upset that the ministry did not address the reform of the system, will receive 12 billion 555 million euros for account payments next year and 2 billion 699 million euros for the final payment for the 2022 fiscal year. The Ministry of Finance requested from the ministry “clarification on the calculation of these amounts” as there was “a difference with the Airef estimates” in the case of the Valencian Community.
Consell had to draw his budgets without knowing the resources he would receive from the SFA. This was based on the report of the independent tax office, which calculated that the Valencian Community would thus receive 15.517 million (12.798 million for payments on account and 2.719 million for settlement). Now, with the figures available to the ministry, another gap of 263 million euros opens up for the Generalitat, in this case in the revenue section. There is a deviation of almost 550 million between the deficit and the gap between SFA resources.
Reform is far away
In addition to the issues on the agenda, the meeting was also marked by demands for reform in the system led by the Community again and the cancellation of the debt agreed with Catalonia. Montero confirmed that the positions between the regions were “contradictory” for this reform and called on the PSOE and the PP to negotiate without pragmatism, “abandoning the maximum position”.
However, it cooled the possibility of a leveling fund until a decision was made to make changes to the system; this was something he left in the hands of Congress (where the PSOE-Sumar agreement includes this as a requirement of Compromí). Merinos asked for “courage” to take it forward.
Regarding debt write-off, he confirmed that this could be extended to all autonomies, whether affiliated with the FLA or not, and that this would be calculated objectively by measuring the impact of the 2008 crisis. According to Fedea, the assistance provided to the Community will ignore the part caused by the individual mistreatment suffered by the autonomy in the amount of an additional 18,000 million according to IVIE.