The second time is expected to be the charm. The Ministry of Finance is set to approve this Friday the reform of the regional financing model after 17 years of debates and fruitless discussions. More than three decades during which public services have been strained and therefore need additional resources. To alleviate this deficit, the proposal that the central government will submit for a vote includes an additional 21 billion euros to the system. However, the Executive has only managed to secure the support of Catalonia and the Canary Islands, co-governed by the PP, so far. The rest of the autonomous communities, all those with PP presidents and two socialists, Castilla-La Mancha and Asturias, have announced that they will reject it. The Community of Madrid will not attend tomorrow’s meeting of the Fiscal and Financial Policy Council, having announced today that it will not attend and has called on other governments of the same political color to boycott it.
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The Ministry of Finance already tried to approve the reform of regional financing last July 29, but decided to postpone the vote to give negotiation another chance. The goal was to break the unity of the PP regional governments. But it has not been possible. The finance ministers of Madrid, Andalusia, Valencian Community, Galicia, Aragon, Balearic Islands, Extremadura, Castilla y León, Cantabria, Murcia, and La Rioja plan to reject the proposal. At the Ministry of Finance, a collective walkout similar to the one they staged during María Jesús Montero’s tenure when the debt write-off was addressed is not ruled out.
The PP has a clear position: “The regional financing system needs a reform that must be negotiated multilaterally, with transparency, where all communities present their demands, do their calculations, and from there a shared model emerges.” In other words, the PP reproaches the Government for having previously agreed the proposal with ERC and now submitting it to a joint vote in the Fiscal Policy Council. “What is not needed is again an imposed, singular model, negotiated with separatists and then presented to the rest,” they add from the PP. “What belongs to everyone is negotiated among everyone, and that is how all the PP regional presidents signed it” in the Zaragoza Declaration, sealed in January this year.
Madrid has today called for a widespread boycott of the Ministry of Finance. “The only way for this agreement not to materialize tomorrow in the Fiscal and Financial Policy Council is for there to be no quorum at the meeting,” the autonomous community pointed out. “The absence of all communities governed by the PP would mean the paralysis of this breach of equality for all Spaniards and the whitewashing of the economic and political corruption of the managers of the Generalitat of Catalonia in recent decades,” it added.
However, the call has not had a widespread effect. The Valencian Community confirms that it will attend the meeting with the Ministry of Finance, as will Aragon. Andalusia has not communicated otherwise. Moreover, the Ministry of Finance assures that “all common regime communities had already confirmed their attendance.” In fact, the preparatory meeting of the council held this morning in Madrid took place in a “climate of normality and no autonomous community has expressed its intention not to attend the Fiscal and Financial Policy Council,” assures the ministry, which has labeled Madrid’s attitude as “institutional hooliganism.” The last absence from the council where regional financing is debated dates back a decade, in the midst of the ‘procés’, when then Finance Minister Oriol Junqueras refused to attend these meetings in Madrid.
Valencian Community confirms it will attend, as will Aragon; Andalusia has not communicated otherwise
It has not been possible to break the unity of the PP despite the Ministry of Finance offering most of the autonomies governed by the party in the state opposition an improvement in their financial resources. According to the model devised by the Government, Andalusia would be the most benefited territory with 4.846 billion euros of additional resources compared to the current system. It would be followed by Catalonia, with 4.686 billion additional; Valencian Community, with 3.669 billion more; and Madrid, with an improvement of 2.555 billion.
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Regarding the refusal of Castilla-La Mancha and Asturias, with PSOE governments, to support the reform, the reasons are different. The Page government has called the proposal an “aberration” and Barbón’s government refers to the 2021 Santiago Declaration in which a “multilateral” negotiation was demanded.
The Ministry of Finance assures that it attends today’s Fiscal and Financial Policy Council meeting “with an open hand, a constructive spirit and reminds that, after all, it will be the Congress of Deputies who will vote on the new model.” The proposal will be approved in the Council of Ministers and then will be processed in Parliament, where the votes of the investiture partners, from Junts to Podemos, will be necessary.
The Government has the yes vote secured from Catalonia. The Department of Economy and Finance of the Generalitat states that it is a reform that incorporates “transparency, justice, and equality, and that will allow the autonomous communities to have more resources. For the Govern, the improvement of 4.686 billion more each year “will allow us to improve our financing and our public services.” Support is also expected from the Canary Islands, which last July announced it would support the approach.
The financing model reform proposed by the Ministry of Finance contemplates a distribution of 224.507 billion among all common regime autonomous communities. In the last settled year, corresponding to 2023, they received 152.484 billion from the financing system. However, the model is voluntary, so it will only apply to territories that accept it. Furthermore, the reform may undergo significant changes or even not be definitively approved in the Cortes.
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