Spain’s Government will be “more strict” with the autonomous communities

The Minister of Finance admitted that the deficit has come about because of the "cyclical" effect the economic downturn has, with falling incomes and spending increases to offset the effects of the crisis, which is to be addressed within communities

Spain’s Government will be "more strict" with the autonomous communities as regards their public accounts.

In an interview with EFE, Salgado said that recently there have been some "negative views" of the debt of several communities, on 17 December the risk measurement agency downgraded the ratings of long-term debt of Castilla-La Mancha , Catalunya and Valencia and monitoring those in Andalusia, Castilla y León, Extremadura and Galicia.

"We have to remedy that situation and of course we must not further increase the debt of the autonomous communities and for that, there is only one route, which is to be thrifty in spending" said Salgado.

The Minister of Finance admitted that the deficit has come about because of the "cyclical" effect the economic downturn has, with falling incomes and spending increases to offset the effects of the crisis, which is to be addressed within communities.

She explained, the government will seek to carry out "what was not possible at the Conference of Presidents: a commitment to the Autonomous Communities with which there are plans for austerity."

Elena Salgado recalled in the interview that the government must submit to the European Commission in January, its plan to achieve fiscal consolidation to reduce the deficit of all administrations to less than 3% of GDP in 2013. The minister will also take the plan to Parliament to explain in detail.

On the other hand, Salgado insists that the government does not foresee difficulties in Spain if it keeps to debt levels calculated (for 2010 debt is expected to reach 62% of GDP).



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