Apr
14
Spanish Prime Minister Mariano Rajoy won the backing of his party’s regional leaders for
austerity plans that include reduced spending on health and
education.
People’s Party chiefs from regions including Madrid,
Valencia and Galicia agreed to reorganize their administrations,
avoid duplication of functions between different levels of
government and put deficit targets into budget laws, Maria Dolores Cospedal, deputy head of the party, told reporters in
Madrid today.
“We need to manage a reality that is very tough,”
Cospedal, who is also the president of Castilla La Mancha, said
after a meeting of national and regional party leaders. “This
shows the government’s commitment to meeting its pledges to our
EU partners and Spanish society.”
Rajoy is struggling to convince investors that his
government can avoid a bailout as his spending cuts plunge the
economy into a second recession since 2009. Spanish credit-
default swaps surged almost 22 basis points to 502 yesterday,
surpassing the previous record of 493, according to CMA.
All but one of Spain’s regions, which control health and
education spending and hire about half of all public workers,
missed their deficit targets last year, pushing the national
shortfall to 8.5 percent of gross domestic product compared with
a target of 6 percent. Andalusia, which has Spain’s highest
jobless rate, and Catalonia, the biggest regional economy,
aren’t covered by the pact announced today because they are
controlled by rival parties.
Prosperity, Welfare, Jobs
“We’ve all set out our commitment to the plan of reforms
the government is implementing,” Madrid’s regional President
Esperanza Aguirre said. “We know that although some are
painful, it’s the only way to generate prosperity, welfare and
above all jobs, which is what Spain needs more than anything.”
Regions will prioritize public services so that they can
deliver spending cuts while guaranteeing “basic” services,
Cospedal said. As an example, she said her region had eliminated
free public transport for those over 65 to ensure they could
maintain basic healthcare services for seniors.
“If the government doesn’t set priorities we won’t be able
to maintain basic services,” she said. “We need to start doing
things how they should be done.”
To contact the reporter on this story:
Ben Sills in Madrid at bsills@bloomberg.net
To contact the editor responsible for this story:
Reed Landberg at landberg@bloomberg.net
Please enable JavaScript to view the comments powered by Disqus.
Open all references in tabs: [1 – 8]
Comments
Leave a Reply
You must be logged in to post a comment.