Governing Esquerra and opposition Socialists announce 2023 budget agreement

The Catalan government will have a new budget for 2023. 

On Wednesday morning, the governing party, Esquerra Republicana, and the leading opposition group, the Socialist Party, announced that they had reached an agreement after weeks of negotiations.

At around 4.30pm, the two leaders – president Pere Aragonès and PSC's Salvador Illa – signed the deal at government headquarters, the Palau de la Generalitat, sealing the pact with a handshake. 

President Pere Aragonès will chair an extraordinary cabinet meeting on Thursday at 10am in order to approve the law, which will then begin its parliamentary procedures. The budget is expected to be passed by MPs and come into force in March.

On Wednesday, presidency minister Laura Vilagrà explained that the spending plan allocates €40 billion euros to public policies, the highest number to date. This includes €124m for health policies, 27% more to fight gender-based violence and €180m for green energy transition.

"This is the most important budget in history in terms of quantity as there are over €40bn. Getting to this point was not easy and negotiations have been long and complex," she said during a press conference.

 

Major shift in Catalan politics alliances

The deal represents a significant shift in Catalan politics in the past year as the pro-independence Esquerra (ERC) opted to make the pact with the unionist Socialists ahead of their former allies and also pro-independence Junts per Catalunya. 

Junts were the junior coalition partner in this executive up until the party left the cabinet last October, officially putting an end to years of cooperation between the two biggest parties in favor of Catalan independence. 

"This is not a legislature agreement"

Salvador Illa

Socialist Party leader

Instead, the left-leaning ERC have reached a spending plan for 2023 with the also-left-leaning Socialist Party. 

However, the leader of the Catalan Socialists, Salvador Illa, has warned that he will not be a long-term partner of Catalan president Pere Aragonès and Esquerra. 

"This is not a legislature agreement," he said. 

Junts: President Aragonès 'abandoned pro-independence majority'

As for Junts, shortly before the announcement of the deal the hardline pro-independence party's secretary general sent a letter to Aragonès offering their hand to back the budget in exchange of rebuilding the consensus towards a way ahead for a split with Spain.

Yet, after knowing the positive outcome of the talks with the Socialists, they said there has been "a change of cycle."

"We are not back to 2017, but to 2004," said Junts' parliamentary president, Albert Batet, referring to the government coalition  between Esquerra, the Socialists and ICV, the predecessor of En Comú Podem, in operation between 2003 and 2010.

For them, Aragonès "has abandoned the pro-independence majority."

Minister Vilagrà asked Junts to also support the spending plan. "It would be good for the country and for the independence camp," she said, adding that the pro-independence majority in the chamber still exists.

Despite the deal with the Socialists, Esquerra's official said they disagree on the political conflict with them, and still believe that the political conflict will only end by "letting residents have their say," referring to an independence referendum.

Socialists and left-wing En Comú Podem ensure majority

In the Catalan parliament, the solo-governing Esquerra hold the support of only their own MPs in the chamber - only 33 of 135 - while the Socialists also have the same number. Until there is a new election or new legislature agreement, which appears highly unlikely, the minority Catalan government will have to reach deals on every bill with opposition parties. 

The 66 seats of ERC and the Socialists will be added to the eight votes provided by En Comú Podem (ECP) after they reached a deal with Esquerra in December for their votes for the budget. Together, the three parties will reach a majority to pass the bill. 

ECP celebrated the news of the agreement between ERC and the Socialists on Wednesday morning: "Catalonia, its people, and its public services needed a budget." 

Their leader, Jéssica Albiach tweeted that with her party's budget agreement it will be possible to "rescue healthcare, make public transport cheaper, promote renewables, and boost public housing," before adding, "in politics you are what you make possible."

Socialists demands in deal: 'modernization' of Barcelona airport, B-40 highway this year, keep casino-hotel complex plans

The agreement includes major infrastructures such as the B-40 highway on the outskirts of Barcelona, the "modernization" of the Catalan capital's airport, as well as the Hard Rock casino-hotel complex that has been at a standstill for years.

These three projects were necessary for the Socialists to vote in favor of ERC's budget bill.

The Government and opposition have agreed to launching the B-40 northern ring road project in the first quarter of this year with a formal agreement with Spain that sets the bases to build the highway. Esquerra and the Socialistshad already reached an agreement on this specific item last week.

The budget also sets out to complete the first stages of the Hard Rock project this year, plans that will be in accordance with the Salou and Vila-seca Recreational and Tourist Consortium, and subject to final approval of the Urban Development Plan. The document, which is due to be signed by both party leaders on Wednesday evening, says that the land where the project is planned to be built has to remain available to Hard Rock.

Regarding the airport, the executive and the Socialists will work together alongside the Spanish government this year on forming a technical commission to "transform" the airport into an international hub. It will not be discussed within the ongoing talks over the independence issue, but separately.

This project also foresees an investment of €49 million in the Llobregat Delta area to protect the natural space with biodiversity. The natural spaces surrounding Barcelona airport, which have special European protection status, have long been a stumbling block to the plans to expand the facility.

In addition, the agreement includes several items on economy, knowledge, renewable energy, health, social rights, education, and security.