The Valencian Government has managed to approve, without fanfare and without the conflicts of previous years, moderate accounts for 2023 that barely grow 1.7% compared to 2022. The approval of the eighth budgets of the Valencian left was more necessary than ever to recompose the image of unity of an executive who has lived complicated days after the abrupt dismissal of the Minister of Agriculture, Mireia Mollà, due to disagreements with the vice president of her party, Aitana Mas.
Therefore, it is not surprising that in the press conference to present the accounts, both Mas and the Minister of Finance, Arcadi Spain, highlighted that the budget pact denotes the “cohesion” of the coalition government made up of PSPV, Compromís and United Podem.
This time the negotiation has not been carried out until the last minute as was usual in Mónica Oltra’s time. In fact, in the final sprint of the negotiation, the top leaders of the parties assumed stripes and accelerated the process to close the accounts in a timely manner, prioritizing the image of stability more than the detail of the numbers.
Yesterday, as required by law, before the end of October, the Valencian Government approved the accounts and sent them for ratification to Les Corts Valencianes.
Some tricky accounts because, although it is true that real spending increases considerably (6.8%), it is no less true that this increase of 1,400 million has been balanced by the forecast of greater tax collection and of an increase in State transfers that are expected to go from 10,865 to 13,540 million euros. A rise of 24.6% that the Minister of Finance did not hesitate to describe as “historic”.
For this reason, the Valencian Government has not had to resort on this occasion to the fictitious item of 1,000 million that was devised last year to compensate for the loss of the so-called covid fund. Of course, despite the record number of transfers of the Financing Model for 2023 with 13,928 million, next year’s accounts do include the claim item for underfinancing of 1,336 million.
Also, in the income, an income of 800 million is re-budgeted that is never paid by the State, which should be used to pay the health expenses caused by citizens of other autonomies and foreigners. Thus, the so-called fictitious items are less ambitious in this budget. With this, the Valencian authorities are also spared the possible scolding from the Ministry of Finance, which already takes the underfinancing item for granted, but other formulas such as last year’s with the covid fund did not like it too much.
All in all, the fact that the Government has refinanced the FLA and extended the term for repayment of the debt has helped to balance the figures, which will allow the Valencian Executive to reduce financial charges by 900 million. Although interest increases, financial liabilities are reduced by 12.8% and the regional coffers breathe a sigh of relief.
The difficult balance of the accounts also helps the greater tax collection. The Executive expects to pay 15.1% in direct taxes and 16.3% in indirect taxes. The executive’s calculations predict that by personal income tax, 717 million more will be collected next year and by VAT more than 600; in total 1,300 million in the two most important taxes.
A cushion that allows spending to be increased in all the ministries and pay the significant increase in chapter 1 (personnel expenses) that rises 6.8% to 8,122 million.
Regarding the strategic lines, the Spain-Mas duet stressed that the budgets for 2023 focus mainly on the implementation of actions against the climate emergency; the fight against inflation and employment protection; the reinforcement of public services and the right to housing, and the strengthening of institutions and democracy.
