Rajoy faces internal rebellion over austerity

Tue, Oct 2, 2012, 01:00

SPAIN’S GOVERNMENT is facing a rebellion from within its own ranks over austerity measures in the 2013 budget.

The Bill, which the conservative administration presented last week, cuts back sharply on spending in an attempt to meet deficit targets agreed with Brussels.

However, the reduction in funds for Spain’s 17 regions has sparked a backlash. Senior figures in the central government’s own Partido Popular (PP) party are among the most vocal critics, such as José Ramón Bauzá, the premier of the Balearic Islands.

“This is a budget that the people of the Balearic Islands in no way deserve and it is absolutely unfair when it comes to the interests of the islands, which are meeting their budgetary and deficit objectives,” he said on Sunday.

The Balearic Islands were among the biggest losers in the 2013 budget. Overall, state spending on the regions is down 16 per cent compared with 2012.

The PP regional premiers of Valencia and Aragón have also spoken out. Valencia’s Alberto Fabra said he would try to improve his region’s share of the budget by pressing for an amendment.

With the PP holding a substantial majority in the national Congress, the budget is expected to be approved, although it can be amended beforehand.

These outbursts, along with similar complaints from opposition politicians, came just ahead of the annual meeting today in Madrid between Spain’s 17 regional leaders and the prime minister, Mariano Rajoy. and the issue is certain to dominate the agenda.

In Madrid, Mr Rajoy’s party has tried to dampen down the unrest.

“Of course we all want more money but we need to have a sense of responsibility and statesmanship,” María Dolores de Cospedal, the PP’s deputy leader, said.

Spain’s regional finances have become increasingly problematic in recent months, helping to keep the country mired in the euro-zone debt crisis. Four regions – Catalonia, Valencia, Murcia and Andalusia – have requested rescue loans from the state to help them meet looming obligations, with others mulling the same course of action.

The north-eastern region of Catalonia, which has requested €5 billion from the state, is also likely to be the focus of today’s meeting. The Catalan nationalist government claims an unfair tax system means it loses out on €16 billion each year, despite being Spain’s biggest economic hub.

A wave of civic nationalist feeling recently has prompted the region’s government to announce its intention to hold a referendum on independence from Spain.