Yesterday, Pedro Sánchez put an end to an era in Spain’s economic policy. Nadia Calviño has concentrated the maximum responsibilities for five and a half years, in coordination with María Jesús Montero – “my sister”, as she defined her yesterday – and Teresa Ribera, mainly. But with the appointment of Carlos Cuerpo as the new Minister of Economy, the functions are distributed. The President of the Spanish Government has set up an unprecedented organizational chart, since a Finance Minister had not had more weight in the Council of Ministers than his Economy counterpart, without the two departments being integrated. An ascent of the department responsible for spending in full fiscal adjustment.
Carlos Cuerpo is the PSOE’s sixth Minister of Economy since the transition, after Calviño, Elena Salgado, Pedro Solbes, Carlos Solchaga and Miguel Boyer, and the first to occupy a secondary position to that of the Finance Minister. During the period of the PP, with its three Ministers of Economy, Román Escolano, Luis de Guindos and Rodrigo Rato, this situation did not occur either.
Montero ascends to the First Vice-Presidency with the essential mandate to push forward the first general budgets of the legislature and to try to reach an agreement to reform regional financing. She becomes the partial coordinator of economic policy, since, even if Cuerpo is appointed minister ras, Sánchez has decided that Economy will maintain the presidency of the Government Delegated Commission for Economic Affairs, the Cdgae, the antechamber of the Council of Ministers through whom all matters in the economic field pass.
The new first vice-president loses, however, one of the Secretaries of State that until now depended on the Treasury. Sánchez has decided that Funció Pública will be integrated into the Ministry of Digital Transformation. José Luis Escrivá will therefore be in charge of negotiating with public employees and will have the mandate, as the president of the Spanish Government stated yesterday, to “take advantage of digitization to improve the quality of public services”.
The poker in the engine room of the economic area, with Montero, Ribera and Cuerpo, is defined with Manuel de la Rocha, director of the Department of Economic Affairs of the Presidency of the Government and promoted after the investiture to Secretary of State .
The renewed economic team of the Central Government still faces a series of challenges, some of which were mentioned by Cuerpo when receiving the ministerial portfolio yesterday. Firstly, the consolidation of growth in an environment of slowdown and uncertainty. Secondly, fiscal responsibility and the reduction of the public debt ratio, at a time when the Spanish Government has just approved a new anti-crisis package with a cost of 5,300 million. The correct development and implementation of the Recovery Plan is another priority that Montero and Cuerpo will have to attend to.
In the business field, Cuerpo maintains a close relationship with the large company, which is now moving up a level. He will now interact directly with top executives. Especially with the financial sector, with whom he has been a fluent interlocutor. An agreement has just been reached to expand the code of good practice in mortgage matters and to strengthen banking services for elderly and dependent people. The conversion of taxes to energy and banks to permanent is another pending issue.
In the labor field, the new Minister of Economy mentioned “full employment” as another of his objectives. The recovery of the purchasing power lost by wages in the last two years, within the social agreement, will be another of its objectives, while the central government continues to try to stop inflation. One of the first decisions in 2024 will be to set the increase in the minimum wage.
Youth, also mentioned by Cuerpo, is another issue that will be a priority in the coalition’s economic policy. Specifically, facilitate their insertion into the labor market and reduce the risk of poverty and social exclusion faced by the new generations. The problem of access to housing, with its own ministry this legislature, and the aforementioned reform of regional financing are also two prominent aspects.
All this with an unstable horizon and in which, in principle, it does not seem that there are conditions for the Spanish Government to be too ambitious in economic policy. In addition, the coalition has parliamentary partners with different interests in economic matters. Achieving the squaring of the circle will not be a simple affair.
