2024-02-07 21:38:33
The PP of Alberto Núñez Feijóo has complied with its warning this Wednesday and has used its absolute majority in the Senate to overthrow the Government’s budgetary stability objectives, on which the General State Budgets are prepared, so as not to be “complicit” in Pedro Sánchez. With this, it causes a new delay in the approval of the 2024 public accounts and puts at risk not only the increase in the financial capacity of the autonomous communities, but also the transfer that the regional governments, the majority in the hands of the PP, receive. each year and that this year they would grow by increasing the spending ceiling. If the ‘no’ is maintained, the previous, more restrictive path will apply.
The PP maneuvers with its majority in the Senate to impose debates on tax cuts on the Government
Since 2012, the budget stability law has established that Congress and the Senate must approve the stability path each year, which includes the deficit and public debt objectives of each State administration. The Government passed the first procedure by one vote. The second failed in the Upper House this Wednesday with the vote against the PP.
The Government now has a second opportunity to approve the objectives. The same legal text states that “within a maximum period of one month” the Ministry of Finance will have to raise this vote again in both chambers. The fixed amounts may or may not vary. The first vice president, María Jesús Montero, assumes that she will once again collide with the PP wall in the Senate.
Those from Feijóo had already warned of the possibility of rejecting the objectives if the coalition government did not negotiate them with them, and despite the fact that, in this case, it implied increasing the economic resources of the autonomous communities. Because the path rejected this Wednesday allowed the communities a deficit of 0.1%, one tenth more than what was contemplated in recent years.
But the defense of the PP’s ‘no’ to the deficit objectives, which are controlled by the European Commission, has had little to do with technical issues. In fact, during the debate this Wednesday, Senator Gerardo Camps attacked the Government’s economic policy in general and defended that his party does not want to be “complicit” with the Executive.
This same week, the deputy economic secretary of the PP, Juan Bravo, already anticipated his party’s rejection, but avoided assessing the economic cut that it will mean for the regional budgets that have already been approved, or are being planned, and that will have to be adjusted if the rejection of the objectives is confirmed.
Bravo demanded in a press conference that the Government assume the PP proposals regarding taxes, such as VAT or Personal Income Tax, as well as energy taxes to vote in favor. “They give Junts everything and we get nothing?” He asked.
The PP has used this vote, like the recent vote on the first three decree laws of the legislature, to attack the Government and its pacts, beyond the specific measures that were being subject to scrutiny.
A more restrictive deficit for CCAA and town councils
The PP’s ‘no’ to a new Government proposal (whether the same in figures or modified) is taken for granted because the debate between the opposition and the Government does not focus on the refusal itself, but on whether the Senate’s rejection closes the door or not to the possibility of presenting the General State Budgets for this year.
The Government has already explained in recent weeks that it has a report from the State Attorney’s Office that supports that the 2024 accounts could be formulated, although based on the stability program that the Executive presented to Brussels in April of last year and not on the figures rejected by the Senate. The PP demands that the Treasury publicly display this document.
The conflict is, therefore, technical despite the fact that it involves motivations that are closer to the partisan struggle than to the economic debate.
The stability path is a document that the Government has to send to the European Commission every year. In it, the first step is taken for the following year’s budgets by committing the deficit and debt objectives for the next three years. In the one sent last year, it already set the reference of 3% for 2024.
Later, in the autumn, another document is sent to Brussels, the budget plan. This should provide more information about the macroeconomic picture, the income and expenditure measures that will be taken and some issues of the basis on which the Budget is built. In it, the Government maintained that 3% objective, but changed the distribution of that deficit. And it is from that document on which the deficit path that has been approved by Congress but overturned by the Senate was built.
This 3% deficit target does not only affect the central government and its budgets. It also sets the framework on which the budgets of the autonomous communities and city councils must be drawn up. On the path of stability that has now been voted on, the State is left with a deficit of 2.7%; the communities, with 0.1%; the town councils, with a fiscal balance of 0%; and Social Security, with a deficit of 0.2%.
The PP has complained about this distribution in recent weeks. Their intention was to demand that the regions receive a larger share of the possible deficit, which would further increase their financial capacity.
But the consequence of rejecting the path voted on this Wednesday is that the communities will not have even that 0.1% because the distribution was different in the previous information sent to Brussels. Specifically, the document granted the central administration a 3% deficit; to the communities, 0%; and to Social Security, 0.2%. It allowed the municipalities a surplus of 0.2%.
That is, the recovery of the stability plan causes the communities and city councils, where the PP has broad power, to have less capacity in their accounts. Paradoxically, the PP’s veto of the path of stability presented by the Ministry of Finance will give the central government three tenths more maneuver in the General State Budgets.
Montero explained from the Senate rostrum that the objective of the stability path being voted on was to “give greater flexibility” to regional and local administrations. “Why does the PP vote against objectives that are manifestly better for their governments?” the vice president asked, “it would be going against their own interests.”
Despite the rejection, Montero maintains his intention to move forward with the budgets. “Even if (the PP) believes that by vetoing these objectives the Government will not be able to prepare the budgets, they are wrong. If your premise is that, what do you say to your communities and city councils that have made their budgets with these objectives? ”He asked himself.
Political argument
During this debate, the PP did present a technical criticism of the deficit path, which was buried under a cloak of political arguments. Although the State’s 3% target is mandatory when the deficit rules are recovered, the Popular Party stated that the distribution only depends on the decision of the central government and that it could be different. A criticism in which some of its parliamentary partners, such as Junts or ERC, agreed. A distribution in which the central government had less deficit in favor of the autonomies would allow, as they pointed out, to cover pillars of the welfare state such as education, health and social services.
The Ministry of Finance and its head, María Jesús Montero, have repeatedly stated regarding this criticism that in addition to the path of stability in which more flexibility was given to the communities, the greatest amount of resources in the system has been approved. of financing history. Deliveries on account in 2024 will be more than 190,000 million euros, increasing last year’s resources by almost 15%.
Although the Government’s thesis that the budgets can go ahead finally prevails, the truth is that the PP has achieved with its veto in the Senate the deficit objective a new delay of at least one month in the preparation of the public accounts. In a normal year, they should have been approved at the end of December of last year, but the 23J elections and the delay in the formation of the Government forced the 2023 accounts to be extended. At first the Executive advocated approving the 2024 accounts in the first quarter. Now we are talking about “as soon as possible.”
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