Last-minute shift from Junts saves Spanish government's recovery plan decree

In an unexpected last-minute turn, Junts per Catalunya has abstained from voting on any of the three decrees that the Spanish government brought to lawmakers on Wednesday, as well as the agreements on stability objectives and the recovery plan.

With this decision, after a mammoth 12-hour session, Junts passively allowed two of the decrees to be approved, while a no vote from Podemos saw another rejected. 

This came after days of the Catalan pro-independence party asserting they would vote no, which would have represented a significant setback for Pedro Sánchez's relatively newly formed government.

After July's general election, Pedro Sánchez was able to form a coalition to govern again after negotiating the support of seven other parties apart from his own, resulting in a potentially vulnerable legislature where every vote will need to be negotiated with many other parties. Wednesday's votes proved something of a litmus test as to how the next years of the Sánchez administration may go. 

The executive and Junts had been in urgent negotiations for hours over the votes, with numerous warnings fired publicly between both sides.

In defending the anti-crisis measures decree, for instance, the Socialist minister warned that a 'no' vote would have meant "significant consequences" for citizens, as it would have led to a return to "cuts" and policies "from other times."

Meanwhile, Junts Congress spokesperson, Míriam Nogueras, had called the Spanish government "irresponsible" for bringing decrees to lawmakers without first negotiating with parties. Nogueras pointed out that the Spanish executive has had Junts' "modest and reasonable" proposals on the table for "weeks," which she said have been ignored.

The abstention of Junts has saved an omnibus decree of various recovery measures. One of the Catalan party's main sticking points was article 43 bis which, according to Junts, offers a "red carpet" for judges to paralyze the amnesty law. Instead, Congress has approved that it be processed as a bill, and therefore the parties will be able to introduce modifications.

Fellow pro-independence party Esquerra Republicana voted in favor of the decree. 

Slimmest of majorities 

The two decrees passed on Wednesday – the so-called omnibus decree of measures related to the justice system, and the anti-crisis measures decree – did so by the slimmest of margins: 172 votes in favor (Socialists, Sumar, ERC, Bildu, PNV, Podemos, BNG and CC) and 171 against (PP, Vox and UPN). 

Anti-crisis measures 

The anti-crisis measures decree will extend VAT reductions for six months until June, to 0% for basic foods and 5% for pasta. Electricity bill discounts will also be extended: 65% reductions for consumers categorized as vulnerable, and 80% for severely vulnerable. 

The decree also extends measures on the regulated gas rate and keeps VAT on electricity at 10%. In addition, it maintains free travel on Rodalies commuter rail and medium-distance rail services, as well as long-distance bus journeys. The 30% discount on city and intercity ticket fares has also been extended. 

With regard to pensions, contributions will increase at the same rate as the consumer price index, 3.8%, while targeted basic income (IMV) will increase by 6.9%. 

In terms of housing, the moratorium on evictions for vulnerable households will remain in place, as will the ban on charging commission for the early mortgage repayments.

Taxes on banks and electricity companies are also maintained. 

Abstention deal

According to Junts, the abstention has brought an agreement that includes Spain delegating immigration powers to the Catalan government, the publication of fiscal balances, and a reduction in VAT on oil to 0%.

The party of former Catalan president Carles Puigdemont say the delegation of powers over immigration "will be accompanied by the necessary resources and will allow Catalonia to make a comprehensive policy so that it is the Catalan government and parliament who determine their own policy, adequate to the needs and the reality of our country."

In addition, according to Junts, the agreement entails the reform of a law that facilitated many companies leaving Catalonia during the independence push, approved by the government of the People's Party's Mariano Rajoy in 2017.

Also, the Catalan party say they have negotiated a reduction of the VAT on oil to 0% and the multiplication "by five" of the money planned for the digitization of the administration of Justice, raising it from €1.2 million to €6.2 million.

In addition, according to Junts, Spain will assume "the entire cost of the discounts and bonuses on the price of public transport," which up to now have been divided by 30% by the Spanish government and 20% by the local councils.

Lastly, sources from the party say the agreement implies a recognition of the "historical rights of Catalonia in matters of local regime."

First decree fails

Meanwhile, the new Spanish government has also seen their first failed decree after the no-vote from left-wing Podemos.

The result is a particularly damaging one for the Spanish government, as just weeks ago Podemos split from Sumar, the left-wing platform that is currently the junior coalition partner in the executive that had initially enveloped Podemos. 

The failed decree foresaw an increase in the unemployment payments from the current €480 to €570 in the first six months of the year and €540 for the remainder of 2024. It also established that workers could accumulate breastfeeding days.