Ángel Collado
Pedro Sánchez’s agreement with the pro-independence ERC to be sworn in as President of the Government, which includes the forgiveness of 15,000 million of Catalonia’s debt, has provoked a block reaction from the regional presidents of the PP and even from those of some of the autonomous regions governed by the PSOE.
If Sánchez manages to form a new government, he will do so in the midst of an assured conflict between administrations, which could last throughout the legislature.
The pact signed last week by Félix Bolaños, acting Minister of the Presidency and as representative of the Socialist candidate, and Oriol Junqueras, the leader of Esquerra Republicana de Cataluña (ERC), places the Catalan government above the rest of the autonomous executives in financial and investment matters. This is how the eleven regional presidents of the Partido Popular, and even the Socialists, such as Adrián Barbón of Asturias and Emiliano García Page of Castilla-La Mancha, have understood it, in view of the announcement of a write-off of 15,000 million euros of debt accumulated by the Generalitat.
In order to try to give legality to this concession to the Catalan separatists, the acting Executive has added that the rest of the autonomous governments could benefit from similar “discounts” on their debt through the Autonomous Liquidity Fund (FLA).
Four days before knowing the agreement of her party with ERC in exchange for the vote in favor of Sánchez, the Deputy Secretary General of the PSOE and acting Minister of Finance, María Jesús Montero, had said that the debt relief of the FLA for Catalonia had been “invented” in the PP. Now, the regional presidents of the PP have announced that they will appeal to the Constitutional Court, because they consider that it implies the rupture of the system and of the principles of equality and solidarity in the financing of the Autonomous Communities.
According to Article 138.2 of the Constitution, “the differences between the statutes of the different Autonomous Communities may not imply, in any case, economic and social privileges”. Hence, the Socialists assure that the future cabinet of Sanchez will also offer the other autonomous governments the same 20 percent rebate and in the same proportion as the one promised to the Catalan one.
The issue is that the PSOE’s agreement with ERC establishes a unilateral operation between the central Administration and the Generalitat, outside the Organic Law of Financing of the Autonomous Communities (LOFCA) and behind the back of the common body in which this type of issues were addressed until now: the Council of Fiscal and Financial Policy of the Autonomous Communities.
The item that Sánchez wants to forgive the Generalitat is almost a third of that 20 percent (about 46,000 million euros) that is promised to all the communities. The most indebted administration when the FLA rescue mechanism was invented, and the most non-compliant since then with any adjustment measure, will now benefit. Despite the debt write-off and pending the announced referendum on self-determination, the Generalitat will continue to resort to the State’s liquidity fund.
The Catalan Community has a debt of 84,000 million euros, of which 73,000 million are covered by the central Administration. These are figures which, in proportion to the population, double or triple those of the other autonomous regions with more residents, such as Andalusia and Madrid. Only the Valencian Community comes close to the Catalan one.
The regional government of Madrid renounced at the time to resort to the FLA, preferring to finance itself on its own without the support of the central Administration, and its debt is now reduced to 34,000 million euros.
The autonomous regions during the last years reduced their expenditure deviations, while Catalonia did the opposite, feel aggrieved. And they reproach Sánchez that, in exchange for the votes of ERC, he now promises them both debt relief and greater funding and investment for regional police or railroads (the so-called Rodalies).
