This week, the government was able to implement the state’s general budget with broad parliamentary support, with 187 votes in favor, 156 against, and one abstention. Undoubtedly, approving public accounts gives stability to the country and the coalition government. The question is what is the price and whether it is these budgets that Spain really needs. It is clear that since these are calculations for the election year, the high spending and adjustments that international organizations are calling for will have to await the next legislature and the government that will come out of the ballot box. This is perhaps most troubling. Numerous social measures have been announced, the kind that look good to run in. Of those that allow politicians to hang the medal, which is paid at the expense of the deteriorating public treasury. Measures ranging from giving 100 euros per month to mothers for each child under the age of three; raising pensions or the minimum income by 8.5%; to allocate more funds for scholarships; To distribute a cultural voucher to young people, or a voucher for rent. The IMF warns that given a scenario of higher interest rates, and thus a higher cost of financing Spain’s high debt, “a moderate cut in the underlying structural fiscal deficit for next year is recommended – from a quarter to half a percentage point of GDP – to help moderate price expectations and reset Affirmation of adherence to financial discipline. In terms of money, we will talk about a modification of between 3,200 and 6,500 million euros already next year. and about 8,000 from 2024. To achieve this, the Fund recommends that instead of applying general measures of tax cuts, specific measures should be taken to help groups that really need it to cope with inflation. In the same sense, the Vice-President of the European Central Bank, Luis de Guindos, has called for a fiscal policy that is “more selective, temporary, focused on the most vulnerable”, who are those most affected by high inflation. It is that fiscal policies must accompany monetary policies. It is not logical that while central banks take measures that help reduce demand and thus reduce inflation, governments are committed to adopting expansionary policies that mitigate the impact of rising prices. If we do not notice the increases in our pockets, we will not reduce consumption either and inflation will not be contained. Funcas’ Fundación de las Cajas de Ahorros also published a report this week warning that despite the increase in collections “the structural deficit is not being reduced”. In this sense, experts warn that while much of the increase in income is temporary in nature, and will disappear as inflation falls, expenditures are structural in nature. This means that when the extra income with which expenditure is now financed disappears, the deficit will rise considerably. In fact, they assert that the financial package that the government has included in the budgets to confront the energy crisis and the effects of inflation can add more than one percentage point to the deficit of all departments. And all this, not to mention spending on pensions, is one of the things that most worries analysts both outside and within our borders.
