There has been no surprise. The Popular Party has kept its promise and has definitively overturned in the Senate the budgetary stability objectives that the Government had established for all Public Administrations for the period 2024-2026. The fiscal path proposed by the Government has been rejected with 146 votes against, 115 votes in favor and zero abstentions.
The intention of Alberto Núñez Feijóo’s party was that, by overturning the objectives, it could paralyze the approval of the 2024 Budgets. However, the Treasury maintains that the processing of the budgets will continue, but using the objectives included in the update of the Budget Plan sent to Brussels. With this, the budgets can be approved but with a collateral effect, a financial cut of a total of 4.5 billion. Of this amount, 1,456 million will be suffered in the first instance by the autonomous communities, the vast majority governed by the PP itself, and 2,924 million will fall to the city councils.
The approval of the stability objectives is the first step to start the preparation of the General State Budgets, in this case for 2024. Normally, it is a procedure that is approved by the Congress of Deputies and which must then be formally ratified. by the Senate. But the peculiar situation of current representation has turned the Senate into a strategic weapon for the PP opposition, in a minority in Congress and with the capacity to stop them in the Upper House, as has happened.
A setback that could be said to be technical, which, as the Government has already warned, will not paralyze the processing of the 2024 accounts and whose final approval depends exclusively on Pedro Sánchez being able to obtain the necessary parliamentary support.
The Ministry of Finance had already explained, when it learned of the PP’s position, that it is continuing with the preparation of the budgets for 2024. In them it has decided to increase the non-financial spending limit by 0.5%, known as the spending ceiling. , up to 199,120 million euros. Decision that depends only on the Government and does not need approval from the chambers.
Regarding the objectives of budgetary stability and public debt, the Treasury commissioned a report from the State attorney’s office to evaluate what the reference should be if the PP blocked, as has happened, those presented. The Minister of Finance, María Jesús Montero, already warned before the vote that this report, which should now see the light, recommends that the Stability Program Update objectives sent to the Commission be used as a reference for the preparation of the budgets. European last April.
In this way, budget stability is established for the autonomous communities, when previously they were allowed a deficit of 0.1%, and a surplus of 0.2% will be required for city councils when previously they were allowed budget stability.
In this way, the margin for spending of both Administrations is cut. In the case of local corporations the cut will be 2,924 million euros and that of the autonomous communities will be 1,456 million. A cut that Feijóo will have to explain to his barons at the head of the autonomies, especially those of Madrid, Andalusia and the Valencian Community, which, together with Catalonia and Euskadi, are where the impact is greatest.
La Vanguardia has had access to the State Attorney’s report that the Treasury uses so that the stability objectives that come into force are those of the April stability program and not those of the October budget plan. In the legal document, the Law Office explains that once the circumstances that gave rise to the application of the safeguard clause as a result of the pandemic have disappeared, stability and public debt objectives will be determined again. It is mandatory, therefore, that there be a budget rebalancing plan.
If the aforementioned plan is not approved by the Congress and Senate, the Government will apply the stability path contained in the stability program, provided that it has been favorably assessed by the Council of the EU, as has happened.
Lastly, the determination of spending will adapt to the path established in the rebalancing plan, concludes the State Attorney’s Office.
