The PP will use its absolute majority in the Senate to overturn the 2024 deficit and debt targets and spending cap this Wednesday, forcing the government to develop a new path and submit it to the upper house within the one-year deadline to be returned month. The Secretary General of the Popular Party, Cuca Gamarra, confirmed this Monday in an interview on RNE the vote against the PP “not to support the government's economic policies”, although this decision also affects the 12 autonomous communities governed by the PP, since they have less fiscal space will have. The popular movement, in turn, is delaying the approval of the General State Budget (PGE), since the spending cap is crucial for shaping public finances.
More information
Approving the deficit and debt targets as well as the spending cap is one of the relevant tasks of the Senate, because if the vote in the upper house does not pass, these will expire and the government will be forced to take a new path and present it within a month. Therefore, the overall budget plans will be delayed by at least another month. Of course, the PSOE intended to postpone negotiations on the state bill after Vox overturned the amnesty law in Congress last week. The socialists are focused first on removing this obstacle and then addressing the PGE issue. But the path will now become even more difficult after the PP announced that it would vote against the spending path.
Gamarra has explained in RNE the reasons why his party will not support the objectives of fiscal stability and public debt for all public administrations for the period 2024-2026, as well as the limitation of non-financial expenditure of the state budget for 2024, which was voted on this Wednesday in the full session of the Senate after it was approved by Congress. “We do not support these deficit targets,” he explained on RNE. “Firstly, because it did not respond to the needs that the Autonomous Communities put on the table. And because we must not forget that the tax autonomy of municipalities must be respected. “There are taxes that the Autonomous Communities are abolishing in the search for economic revitalization, while the State is trying unilaterally to impose them, thus preventing fiscal autonomy,” he argued.
In a subsequent press conference at party headquarters, the People's Party set out its conditions for negotiating a new spending cap after this Wednesday's plenary session. But the demands required the possibility of forging an agreement, not only because of the high level of confrontation between the PSOE and the PP, but also because the economic conditions demanded by the national leadership had already been rejected by the government before – such as the Deflation of income tax for incomes below 40,000 euros or reduction of VAT on meat and fish. Therefore, understanding is expected to be impossible. “On other issues, we saw that the plenary sessions were interrupted so that an agreement could be reached,” said Juan Bravo, deputy economy minister of the PP, referring to the talks between the Socialists and the Junts to validate the anti-crisis decrees .
Other conditions demanded by the PP are the reduction of VAT on electricity and gas; the abolition of the tax on energy companies; a higher level of “shared responsibility” in the distribution of the deficit between the government and municipalities, as well as the provision of an additional fund for the services provided by the territories. Already at the beginning of January, before the plenary session in which the three anti-crisis decrees were debated, the executive refused to ease the fiscal pressure demanded by the people. Government sources calculated that around 9,000 million euros less would be lost to public coffers, an “unaffordable” cost, they claimed at the time.
What influences the most is what happens next. So you don't miss anything, subscribe.
Subscribe to
If the PP were to reverse course in the Senate for the second time, uncertain territory would arise. According to the government, the deficit targets of the stability plan presented to the European Commission in April, which are more ambitious than those planned for 2024 – path of 0% instead of the proposed 0.1% – would be applied. This would force the PP Autonomous Communities to tighten their belts. Last December, the first vice president and finance minister, María Jesús Montero, already warned the PP that if it reduced this deficit path, it would return to the courses approved in the stability program last April, which are tougher and more demanding. “The PP would throw stones on its own roof,” warned Montero. However, supporters of a national political decision have prioritized and tried to place new obstacles in the way of Pedro Sánchez's government.
The problem that arises from now on is that some PP municipalities have already approved their respective budgets according to the 0.1% spending path. From the point of view of the popular leadership, there are no problems in this sense, since their accounts are balanced and they accuse La Moncloa of “not doing their homework on time”. They also ensure that the territories agree to vote against deficit targets in the Senate. “This is not a political decision. “Don't try to say that it hurts the autonomous communities and the city councils, don't try to take them to task,” Bravo told the government at a press conference where he appeared alongside the speaker of the PP Senate, Alicia García . “We hope that the government will listen to the People's Party's proposals to repair the damage. I am very afraid that he will not do it because Sánchez is tied hand and foot,” the senator added.
Subscribe to continue reading
Read without limits
_