The Minister of Finance, María Jesús Montero, opens up to canceling the debt of Catalonia and other autonomous communities in a new regional financing model, if Pedro Sánchez achieves the investiture.
Asked specifically about the formal request of Junts and Esquerra for a cancellation of the debt of Catalonia with the Autonomous Liquidity Fund (FLA) published by EL MUNDO this Monday, the minister has opened the door to forgiveness, but more than bilaterally, within a new financing system. “There are many elements within the system that not only from Catalonia, but also other communities have always put on the table. The Government will have to address all the components of the puzzle.”
The minister has included in the puzzle a solution to this debt problem and to other aspects such as the distribution of the adjustment effort once the deficit rules in the EU come into force again from 2024. She has assured that, although has not addressed it in the last five years, it is proposed to change the system “in the shortest possible time” if it continues in the Ministry.
Speaking to La Sexta, Montero stressed that one of the dysfunctions of the current system is that “the debt is asymmetric” between the communities, but he pointed out that this is not only the case of Catalonia, but that “the Valencian Community presents a situation proportionally more critical”. According to the latest data from the Bank of Spain, Catalonia accounts for close to 40% of the regional debt of the FLA with more than 70,000 million owed, followed by the Valencian Community with more than 45,000. The total amounts to 187,000 million accumulated since the creation of the FLA in 2012 as a formula to provide liquidity to communities with low-interest loans and long maturity periods.
Both in absolute terms and per capita, Catalonia is the highest recipient and main debtor of the State with the FLA, with which any remission would especially benefit this community. Proportionally, the debt in the Valencian Community weighs more, but it is not comparable, because it was particularly punished in the current financing model approved by the Zapatero government in 2009 and made, according to the leader of the PP, Alberto Núñez Feijóo, “to the measure of Catalonia”.
For the moment, Junts and Esquerra have already approved a motion in the Catalan Parliament to obtain the forgiveness of the debt with the FLA and the Partit dels Socialistes de Catalunya (PSC) has offered to support a partial debt reduction by creating “a coefficient of forgiveness” Open to other communities.
Montero describes the debate as “precipitated” because “no issue should be anticipated.” She has underlined the number two of the PSOE that first the investiture is missing and then the negotiation of the new model. However, she herself is part of the discreet negotiating team of the PSOE to obtain support for the investiture.
Expressly asked about whether or not to rule out the remission, the minister stated that she is not pronouncing at the moment “neither one way nor the other”, thus opening the aforementioned possibility of a financial pardon that is already causing controversy.
The president of the Community of Madrid, Isabel Díaz Ayuso, reacted strongly to what was published by EL MUNDO. “They buy power with the money of all Spaniards, in comparative injury with the CCAA that strive not to get into debt,” she has published on her twitter account. She has also made a parallel with the self-employed and families who are not forgiven debt.
For his part, the president of the Valencian Community, Carlos Mazón, has described the inherited debt with the FLA as “unaffordable”, but has not expressly requested its cancellation as his predecessor, Ximo Puig, had done in the past, because “of the complaint is not lived, but the reaction”. He has assured that it is equivalent to 12,000 euros per Valencian and that he will try to reduce it by activating the economy by lowering taxes, reducing political spending and the drop in the number of politicians.
Montero has underlined that the forgiveness request has been led in the past by the Valencian Community in a possible sign that it would politically present an eventual forgiveness of the regional debt more as if it were in favor of this territory than that of Catalonia.
From Ciudadanos, the Catalan deputy Anna Grau, recalled this Monday that she voted against the cancellation motion in the Catalan Parliament: “The angry and spoiled independence movement is that they trust you today and pay twice the debt tomorrow.”
The PP deputy, Jaime de Olano, is also critical: “Sanchismo only cares about Sánchez: Sánchez intends to endorse the rest of the Spaniards with the 70,000 million debt generated by the independentistas in Catalonia. What will the Andalusians, Extremadura, Madrid, think? Galicians, Valencians… who voted for Sánchez?”
On the other hand, the acting Minister of Finance has added that she intends to find solutions for the town councils in the new financing system and that she intends to address changes “in a climate of dialogue, cordiality and understanding”- “It is evident that we have ahead during this legislature neither more nor less than the reform of the regional financing system, which has many legs”.
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