The government ignores Aref’s proposals to improve the efficiency of up to 60 billion euros of public spending

If analyst expectations are met, the public accounts It will close 2022 with a deficit of 4.5% of GDP (about €50,000m) in a year when tax revenues are expected to reach an all-time record, thanks in part to rising inflation. Despite the financial pressures that this situation generates in terms of public debt, and despite the fact that these figures put the country outside the European normal threshold, which is less than 3% of GDP, the Independent Authority for Fiscal Responsibility (Airef) revealed this Wednesday . That the government has ignored its proposals and recommendations to improve the effectiveness of public spending in items that together add nearly 60.000 million euros.

The balance refers to the first major operation to assess public spending – the ‘pending audit’, in technical terms – that was carried out between 2017 and 2020. During this, the authority’s technicians were set up at Brussels’ request after a major crisis in order to have an independent spending watchdog. year in Spain, they analyzed items with a total amount of 90.000 million euros and discovered deficiencies that would allow Improve performance or reduce spending on sections totaling 81 thousand million in euros.

The balance released on Wednesday by the Tax Authority revealed that after this diagnosis, which gave rise to 277 proposals by the authority, the government only took action on items that together add up to €21,870 million, i.e. on a quarter of ineffective public spending that Airef discovered it, while it has a pending analysis of 55,890 million and has directly refused to act on items worth 3.240 million, sometimes because they consider it not to fall within its direct powers and sometimes because they directly understand that it will have a political cost, according to the explanations conveyed by Raees Arif , Wednesday , Christina HerreroAnd by the person in charge of the evaluation department of the institution, Jose Maria Casado.

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“Public expenditure assessments are so useful that they are taken into account when making decisions,” emphasized Cristina Herrero, who admitted that the FCA’s satisfaction with the government’s follow-up to its recommendations could only be partial. When only a third of the proposals and recommendations submitted were addressed.

Another discussion, they acknowledged on Wednesday from Corporal, is the way these recommendations have been addressed, where, as shown, in the case of the tax deduction for retirement plans, the IRS asked for an overhaul of the incentive to do it more attractively and effectively and what the government did is Significantly reducing the incentive for individual plans and improving tax support for employment plans, which means more than partial implementation of Airef’s recommendation.

“We feel good if that was at least taken into account when making the decision,” admitted Christina Herrero, who stressed that the analyzes do not look at the success of the recommendations and proposals formulated by Airef but merely the fact that it led to action on a specific expenditure item. This was achieved in just over 21,000 million public expenditures out of the 90,000 million valued by the institution.

“We have already been warned that the bull will catch us.”

Cristina Herrero took advantage of the call and the European Commission’s announcement of the reintroduction of fiscal rules for 2024 to question government negligence when it comes to controlling spending. He stressed that “we should have worked on this,” in connection with the numerous calls made by the Tax Authority and other organizations such as the Bank of Spain for the government to move forward in determining the course of consolidating public finances in the middle. Term before that the European Commission reintroduced the fiscal rules. “We’re taking the time Warning that the bull will catch us We are now at this point.”

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The Public Finance Authority also intends to publish in the coming days an opinion on the sustainability of Spanish public accounts, which will aim to take a look at the path that public spending could take in the coming years and the size of the budget adjustment that they will receive. The government should assume that the public accounts are restored to a sustainable environment. Airef forecasts indicate that Spain will not be able to place its accounts at around 3% before 2026.

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