catalan government

The Constitutional Court has accepted to debate the Spanish Government's last appeal against the Catalan Executive's tax on bank deposits, which has to be paid by financial entities. Such a decision represents the automatic cancellation of the tax for an initial period of 5 months. Catalonia approved such a measure in December 2012 and two weeks later, the Spanish Government approved its own tax with a 0% rate, so it was 'de facto' cancelling the regional taxes. However, instead of compensating Catalonia for having cancelled the tax – as it is legally obliged to do – the Spanish Government refused to do so, since it argued that the tax had not entered into force yet and took the issue to the Constitutional Court. The Court initially accepted the Spanish Executive's appeal and the tax was temporarily suspended, but in May 2013 it was lifted. In July 2014, the Spanish Government modified the tax with a 0.03% rate and in December it presented a new appeal against the Catalan tax, which brought in some €680 million in 2014.

Catalonia posted a 19.88% unemployment rate at the end of 2014, almost 4 percentage points lower than the rate for the whole of Spain, which was 23.70%. On 31 December 2014, there were 756,500 unemployed people in Catalonia, which represents 83,000 less jobseekers than a year ago, according to the Spanish Statistics Institute (INE). Despite the positive annual results, unemployment increased by 30,500 people in quarterly terms, compared to figures from the end of September 2014. Back then, Catalonia's unemployment rate was 19.10%. In terms of jobs, the Catalan economy ended 2014 with 49,300 more people in employment than at the end of 2013, reaching 3,048,100 workers. The Catalan Government is said to be "moderately optimistic" with the figures and highlighted that both 2014 and 2013 ended with less unemployed in annual terms, accumulating two consecutive years of decreased numbers.

The Catalan Government is expecting to post a 2.2% deficit for the whole of 2014, corresponding to some €4.41 billion. However, the definitive figure will not be known until March. This is more than  double the 1% deficit target that the Spanish Government unilaterally imposed on the Catalan Executive. Over the last few years, the two governments have quarrelled about deficit targets, since the Spanish Executive is imposing much stricter objectives on the Autonomous Communities than those it allows itself, despite regional governments exclusively managing and funding the basic Welfare State services such as healthcare and education. For instance, for 2014, the Spanish Government only allowed the Autonomous Communities to only have 15% of the whole deficit allowed by the European Union to Spain’s entire public sector, despite managing some 35% of the country’s public funds and basic services.

The Catalan Parliament approved on Wednesday the Law on the Val d’Aran’s special status within Catalonia, recognising its “Occitan national reality” and its right to self-determination. This small Pyrenean valley, surrounded by high peaks and located in Catalonia’s north-western corner, is the last land where the Occitan language is widely spoken, although it is called Aranese there. The Val d’Aran County has had a certain degree of self-rule within Catalonia since 1990, further recognised with the Catalan Statute of Autonomy from 2006. In addition, since September 2010, Aranese is Catalonia’s third official language, being the preferred language in this county. The law approved this Wednesday develops and consolidates the Val d’Aran’s special regime, with its own powers of self-rule and structures. In order to enter into force, it will have to be approved through referendum by the less than 11,000 inhabitants of the valley.

The Catalan Government presented this week a first draft of the urban plan that is developing for the 800 hectares surrounding PortAventura theme park, in the Costa Daurada, near Tarragona. The $6 billion holiday resort BCN World is supposed to be built in this area, which is now being promoted by the Catalan Executive itself after the private investor Veremonte did not meet the final deadline for buying the land in December. The urban plan foresees towers of 20 to 25 floors and the construction of 500,000 square metres of tourist and residential-use areas between the Las Vegas style casinos and the beach. Veremonte and its partners Melco, Hard Rock, Caesar’s Entertainment, Melià and Value Retail continue to be involved in the project, along with other investors such as Investindusrial (which owns PortAventura), Ferrari (which wants to build its first European theme park there) and Perelada (which owns other casinos and luxury hotels in Catalonia).

The 1st Digital Government Congress organised by the Catalan Government and the Open Administration of Catalonia consortium (AOC) will take place on Wednesday and Thursday at the Palau de Congressos de Fira de Barcelona. The main aim of this summit is to develop through the use of new technologies the public administration into an “open and innovative administration” that will be smarter, more efficient and effective in order to give “real answers to the demands and expectations of society”, according to Àlex Pèlach, the Managing Director of the AOC consortium.

The Catalan Government has formally requested €9.46 billion in loans from the Liquidity Fund for the Autonomous Communities (FLA), run by the Spanish Finance Ministry, to face debt payments and other obligations during 2015. This is the only way that the Spanish Government authorises the Catalan Executive to request liquidity as it has banned Catalonia’s access to financial markets to obtain additional funds, as many governments do when they issue bonds or ask for loans. Therefore, the FLA has become the Catalan Executive’s only bank and a source of funds that must be returned. However, for the first time this year, the Spanish Government will not make money on the FLA and has set a 0% interest rate, which will have a €300 million positive impact on the Catalan Executive’s budget.

Following the agreement reached last week between the President of the Catalan Government and leader of the governing centre-right pro-Catalan State coalition CiU, Artur Mas, and the President of the left-wing pro-independence party ERC, Oriol Junqueras, on calling early elections in September as a plebiscite on Catalonia’s independence from Spain, the Catalan Executive’s budget for 2015 is now closer to definitive approval. On Monday, the ERC MPs started to withdraw their full amendments to the different sections of the Catalan Government’s budget. Now, the ERC is asking the CiU and the Government to debate their specific amendments on precise programmes in order to have “a fairer budget” which is less regional and more that of a country in its “national transition”, they said.

The Spanish Deputy Prime Minister, Soraya Sáenz de Santamaría, strongly criticised the calling of early elections in Catalonia, announced by the President of the Catalan Government, Artur Mas, for 27 September as a ‘de facto’ plebiscite on independence. Sáenz de Santamaría stated that such a call shows Mas’ “failure” and his “incapacity” to run a government. She also said that the Catalan President is announcing elections 8 months in advance “to hide his ineffectiveness”. Besides this, the Spanish Deputy PM warned Catalan authorities that any measures adopted in the coming months that exceed Catalonia’s self-rule powers will be taken to the Constitutional Court. 

The President of the Catalan Government, Artur Mas, insisted on Friday that “a clear absolute majority” will be needed for the pro-independence parties in the early elections scheduled for 27 September to make the world understand that the creation of a new independent state must be negotiated. In a radio interview, Mas explained that the road map towards independence - if there is an electoral majority - is still being negotiated among the different parties and organisations, in order to run separately but with a shared road map in case of victory. This road map would include demanding the start of immediate negotiations with the Spanish Authorities to reach an agreement on Catalonia’s independence from Spain if a majority of citizens vote for this scenario on the 27^th of September. 

The European Commission has warned Spain that 6 Autonomous Communities, including Catalonia, should cancel their tax on large-sized shopping centres because it may represent indirect State aid benefiting smaller shops and therefore damaging free competition. The Catalan Minister for Business and Employment, Felip Puig, announced legal actions to defend this tax, which was validated by the Constitutional Court. Catalonia’s shopping model has a great presence of small and local shops, mostly run by families with a small number of employees. In order to protect this model and make it compatible with new shopping malls and large-sized international shops, in 2000 the Catalan Parliament created a tax on shops larger than 2,500 square metres. Currently, it is set at €17 per year per square metre. The revenue collected is devoted to actions promoting local retail.

The Spanish Prime Minister, Mariano Rajoy, who is also leader of the conservative and Spanish nationalist People’s Party (PP), strongly criticised the announcement of early elections made by the Catalan President, Artur Mas, the evening before. Mas announced elections in Catalonia for 27 September this year, transformed into a ‘de facto’ referendum on independence. These elections are the only way Catalans can vote on this issue, taking into account the Spanish Government’s total opposition to even talking about self-determination demands, which were backed by an absolute majority of citizens in the last Catalan elections (held in November 2012) which themselves were already a plebiscite on having a legal vote on independence. However, as opposed to the British Government, Rajoy refused to even discuss these demands, has not made any concessions, and has showed total opposition, which has even involved the criminal prosecution of the Catalan President.

The President of the Catalan Government, Artur Mas, has announced early elections to be held on the 27^th of September this year, which will become a ‘de facto’ referendum on independence from Spain. Before then, the Catalan Government and Parliament will continue to develop some basic state structures, such as Catalonia’s own tax administration and Social Security system. The governing centre-right pro-Catalan State coalition CiU and the opposition left-wing pro-independence party ERC have now “rebuilt” their parliamentary stability pact for the current term after weeks of public disagreements and confusion over the next steps of the self-determination process. After a long meeting on Wednesday evening between Mas, the ERC’s President Oriol Junqueras and representatives from the main civil society organisations supporting independence, they have also agreed on running separately but sharing the same road map to build an independent state from the day after the elections, if a majority of Catalans vote for this option. 

Despite a decrease in Russian visitors, Catalonia increased the number of international tourists it hosted during 2014. Some 16.7 million foreigners travelled to Catalonia last year, which sets a new historic record. In addition, it represents a 7.2% increase on 2013 figures. International visitors spent more than €15 billion during their stay, 6.1% more than in 2013. Therefore, foreign tourism accounted for some 7.5% of Catalonia’s entire GDP during 2014. Each tourist spent an average of €900 during their stay. The Catalan Minister for Business and Employment, Felip Puig, presented the figures on Wednesday and emphasised that the objective for future years is not so much to increase the number of tourists but rather to increase the revenue which they bring in. 

The President of the Catalan Government, Artur Mas, assessed on Tuesday the Executive’s work during 2014, which he found to be “positive” overall, although he admitted there are still many people in great need and many social and economic challenges ahead. Referring to the current debate on whether to call early elections transformed into a ‘de facto’ referendum on independence from Spain, Mas promised immediate decisions to be announced on Thursday. Before taking the definitive decision and after weeks of admitted “confusion”, the Catalan President wants to hold a last round of talks with the main civil society organisations supporting independence and the left-wing pro-independence party ERC – with whom the governing centre-right pro-Catalan State coalition CiU has shared a parliamentary stability agreement for the last 2 years. “I will not slack” in the self-determination process, Mas stated.