The Spanish Government closes the door on negotiating a new fiscal agreement with Catalonia

Madrid (ACN).- The Spanish Government has refused to negotiate a new fiscal agreement with Catalonia, slamming the door in the face of the wide majority of the Catalan population. On Thursday, the Catalan President, Artur Mas, and the Spanish Prime Minister, Mariano Rajoy, met in La Moncloa Palace, 9 days after the 1.5 million strong demonstration supporting Catalonia’s independence from Spain. Rajoy justified not considering the proposal for a new fiscal agreement between Catalonia and Spain by stating that it does not fit into the Constitution. In a press conference given in the Catalan Government’s office in Madrid instead of La Moncloa, the Catalan President reflected on the talk’s results. He stated that, “if the Constitution is always interpreted from a centralist point of view”, “Catalonia will have to quietly and democratically reflect on its own future” as “no legal framework can be eternally used to annul the majority, democratic, and peaceful will of a people”. This fiscal agreement proposal was approved by more than two thirds of the Catalan Parliament and, according to recent polls, almost 80% of Catalans – including the main business associations - support a fiscal formula by which Catalonia would raise all its taxes and reduce its solidarity contribution to the rest of Spain, currently equivalent to 8.5% of the GDP (a contribution of some €17 billion per year).

Significantly, no member from the Spanish Government, run by the People’s Party (PP), publicly assessed the meeting with the President of the Catalan Executive. The Spanish Government only issued a press release after the meeting, in which it reaffirmed its refusal to negotiate a fiscal agreement. In line with the previous days’ stance, the press note insisted that the Spanish Government will only act according to the Constitution and that the priority is now to recover from the economic crisis. There was no mention at all of the previous week’s massive demonstration, neither of the claims for independence. It also remarked that Catalonia had applied for €5 billion from the Liquidity Fund for the Autonomous Communities and that the Spanish Government has been providing financial assistance to the Autonomies this year. However, it  did not mention Catalonia’s 8.5% annual fiscal deficit; neither that deficit targets for the Autonomous Communities are much stricter than those for the Spanish Government, despite the fact that they manage 40% of the public budget and the main welfare state services, such as healthcare, education and social policies. Instead, the Spanish Prime Minister told Mas that the current fiscal scheme will be reviewed in 2013, as it expires that year and its revision is thus a legal obligation.

“A lost opportunity […] perhaps the last one”

After the meeting with the Spanish PM, the Catalan President emphasised that Rajoy’s refusal to negotiate a specific fiscal agreement with Catalonia was “a lost opportunity”, and “perhaps the last one”, to find a comfortable place for Catalonia within the Spanish State. “The meeting did not go well. And I say so in a sad mood. I believed it was important that this meeting went well for the relations between Catalonia and Spain”, said Mas. “It was not only a matter of money”, but “getting a different status within the Spanish State”, he underlined. However, “Rajoy’s answer has been straightforward: there is no room for negotiating” a specific fiscal agreement for Catalonia, neither with the current Spanish Government, nor with the PP and PSOE, explained Mas. “They are offering us the same old story”, said the Catalan President referring to the revision of the current model in 2013. Therefore, Catalonia’s fiscal pact is a “dead end” now. “I have reached the end and I am facing a wall, a contention dike”, he added.

The Catalan President stated that if the Spanish Government would have sent a positive signal that the specific fiscal pact might be discussed in some months, once the financial situation is more stable, he would have accepted, as “we knew we would not get a final agreement today”. However, the Spanish Government made clear that “it is a dead end” and will not be accepted. “There is no point in insisting [on the fiscal agreement] if the other part of the table has no will and no interest in negotiating”, he said. “In this situation, we cannot bang our head against a wall, as we will get hurt”. Therefore an alternative must be found since “Catalonia cannot give up its scenarios for the future”, he declared. “Catalonia needs to build its own project”.

“A European project, within the European Union and the Euro”

From this moment, “all the decisions are open” said Mas, including calling for early elections this autumn, which some parties might use as a de facto independence referendum. However, the Catalan President pointed at the next immediate step: a “serene and positive reflection” on the current situation and the future, held in next week’s parliamentary debate on the state of the Catalan nation. In any case, whatever Catalonia’s decision is, “it will not be a total break”, as it will be “a European project, within the European Union and the Euro”. “We have not gone crazy”, he insisted. “The European Union is moving towards a federal EU”, and “Catalonia clearly wants to be part” of this project.

“Catalonia considers itself as a nation, and this will not be changed”

Mas explained that Catalonia has been trying to find a more comfortable place within the Spanish State for the last 35 years, without success. Now the Spanish Government is using the Constitution to block Catalonia’s will. However, the Catalan President noted that “there is no legal framework that can be eternally used to annul the majority, democratic and peaceful will of a people”. “Catalonia considers itself as a nation, and this will not be changed. The feelings of the people, the Catalan identity, which has deep roots […], will not be annulled by a Constitution, nor public statement, pressures or threats”, he stated. “Neither of the dictatorships managed to change it”, he emphasised.

A Constitution re-read in centralist terms

The Catalan President is convinced that his proposal for a specific agreement between Catalonia and Spain was constitutional, as “many law experts have stated”, he said. However, the problem is that “the Constitution is always re-read in centralist terms”. However, this was not its spirit, insisted Mas. The Spanish Constitution was ambiguous as it was meant to allow different interpretations, when calmer times arrived. “It was made in 1978, three years after Franco’s death, one year after the return of President Tarradellas [Catalonia’s President who was in exile], and three years before” the coup d’état of 1981, when the “Guardia Civil invaded the Parliament”, explained Mas. The Constitution “was written in those years, but it was made in a way that it might be re-read” in the future. However, each time that Catalonia has tried to interpret the Constitution in more federal terms, it has faced the blocking majority of the Spanish centralism. Therefore it is logical that “those being more unsatisfied with the current model are the Basque Country and Catalonia”, emphasised Mas. “We need to be able to talk about the territorial model, because things have changed and Catalan society has changed”, claimed Catalonia’s President.