The Catalan and Spanish Governments confirm that no specific deficit target has been agreed on yet

Madrid (ACN).- On Monday, the Spanish Prime Minister, Mariano Rajoy, stated that in his meeting last Friday with the President of the Catalan Government, Artur Mas, they did not discuss specific deficit target figures for Catalonia. On that day several high-level meetings to discuss the issue were held in Barcelona between members of both executives. On Saturday, the Spanish Finance Minister, Cristóbal Montoro, stated that the Catalan Government’s deficit for 2013 will not be above 2% despite the requests from Barcelona. The Catalan Government has been asking for a 2.1% deficit target, corresponding to a third of the 6.3% that was announced by the Spanish Government as the figure expected for Spain’s entire public sector instead of the 4.5% previously authorised by the European Union. On Monday, Rajoy also stated that no specific deficit target will be decided for the Catalan Government and the rest of the Autonomous Communities before the EU officially confirms Spain’s total deficit objective. In addition he asked everybody, including some of the People’s Party’s leaders and presidents of Autonomous Communities, to act in a “sensible” way as well as having “common sense, generosity and high-mindedness”, since this is “an issue concerning all of us”, he stressed. In the last few weeks some People’s Party leaders protested about the Catalan Government’s request for a 2.1% deficit and the negotiations with the Spanish Executive.

The Catalan Government is asking for a third of this amount since the Autonomous Communities are managing 36% of Spain’s total public spending and exclusively run basic services such as healthcare and education. The 6.3% deficit target has not been officially authorised by Brussels yet but everybody expects it will be since the European Commission has already said they consider it to be a realistic target and there are some international forecasts even posting a 7% deficit for Spain in 2013.

The Catalan Finance Minister confirmed that no specific deficit targets have been set yet

In addition, on Monday, the Catalan Finance Minister, Andreu Mas-Colell, recognised that no specific deficit target has been set yet for Catalonia. Mas-Colell said that he has already given all his arguments and now he is waiting for the Spanish Finance Ministry’s answer. However, he added that the exact figure will not be known until at least June. Mas-Colell hoped to have the figure as soon as possible in order to close the drafting process of the Catalan Government’s budget for 2013 and present it to the Catalan Parliament for approval. In addition, the Catalan Finance Minister added that the conversations with the Left-Wing Catalan Independence Party (ERC) – which signed a parliamentary stability agreement with the governing Centre-Right Catalan Nationalist Coalition (CiU) – are ongoing in order to get their support to approve the budget.

The 2013 Catalan budget has been delayed because elections were held in November and it was the new Cabinet that was in charge of drafting a new budget. Until this happens, the Catalan Government is operating by extending the 2012 budget under certain guidelines.

Reviewing the budget-extension guidelines and raising the deficit target to 1.2%

In fact, Mas-Colell also added that the department he chairs will adapt the guidelines for extending the 2012 budget to a 1.2% deficit, since the previous ones were set for a 0.7% deficit target. Last year, the Spanish Government set a 0.7% deficit target for the Autonomous Communities, despite loud protests from Catalonia. About a month ago, considering the poor economic results, the Spanish Government was obliged to review this and has already raised the target to 1.2%. However, it is not the definitive deficit target for the Autonomous Communities since negotiations have taken place during the last few weeks and Catalonia has been asking for a target of 2.1%. While, the Catalan Government is waiting for the final figure to be set by Madrid, Mas-Colell will adapt the budget-extension guidelines to a 1.2% deficit since the definitive target “will not be lower in any case”, added the Catalan Finance Minister.