expenditure

International visitors spend 14% more than last year

The pro-independence parties in the Catalan Chamber, governing cross-party ‘Junts Pel Sí’ and radical left CUP have passed the 2017 budget. The bill has been described as the last budget of the autonomic period, since it foresees calling a referendum on independence next September. Last June, CUP refused to pass the bill for 2016 which led to the vote of confidence promoted by Catalan President, Carles Puigdemont. They considered the numbers presented then to be “too autonomic” rather than responding to the pro-independence aspirations of Catalonia. After a new draft was presented last November, increasing the social expenditure and reinforcing the government’s commitment to call a referendum, CUP have accepted the bill. However, they have urged the Catalan Government to announce the date and the question of the referendum as quick as possible.

Tourists from outside of Spain spent 17,328 MEUR in Catalonia in 2016, which represents 3.7% more than in 2015. According to the Tourist Expenditure Poll (Egatur), published by the Spanish Statistics Institute, Catalonia achieved its best result in the historic series and became, once again, the region which takes in the highest amount of tourist expenditure in the whole of Spain. Indeed, Catalonia was the focus of 22% of tourists’ total expenditure in Spain, followed by the Canary and the Balearic Islands. Those tourists who spent the most were the British, followed by Germans and the French, according to figures corresponding to the whole of Spain.  

The support of 2 MPs from radical left pro-independence CUP, the main partner of governing cross party 'Junts Pel Sï', allowed the budget for 2017 to overcome the appeals presented by the oppoistion groups in the Parliament. Catalan Vice President and Minister for Economy and Tax Office, Oriol Junqueras, defended this Tuesday the budget for 2017. According to Junqueras, the draft especially focuses on “fiscal justice” and social expenditure, which he defined as fundamental pillars for economic growth. “We have many difficulties and many more are being put in our way, but it is clear that our economy and our society are capable of making it through”, he stated on the first day of the two-day session during which the Parliament will vote on the budget for 2017. “This is the best budget possible”, he assured in November, right after presenting the bill to the Parliament’s Bureau and emphasised the social orientation of the draft budget. Indeed, more than 74% of the total bill for 2017 is allocated for social expenditure and €1.1 billion more has been allocated for this purpose in comparison to the budget for 2015, which had to be extended for 2016.

The Government’s draft for the 2017 budget was published in the Parliament’s Official Journal this Tuesday. On Wednesday, the different groups in the Catalan Chamber will be able to present appeals and the whole bill will be discussed on the 20th of December. “This is the best budget possible”, Catalan Vice President and Minister for Economy and Tax Office, Oriol Junqueras, stated right after presenting the draft. “The time of cutbacks is over”, he assured and emphasised that the budget for 2017 has been enhanced in comparison to the previous one “both as a whole and in each department”. Indeed, the budget for 2017 allocates €1.1 billion more to social expenditure than the bill for 2015 – which was extended for 2016. The Health System with €8.7 billion and Education and Universities with €5.5 billion are the areas with the highest amounts allocated.

The Catalan executive and radical left pro-independence CUP are negotiating the fiscal law, the so called Accompaniment Law, for the 2017 budget. The draft is set to include tax reforms as well as the introduction of new taxes especially oriented toward avoiding property speculation. One of the main hurdles has to do with the reform of income tax, which foresees the elimination of tax relief for property purchase for those who earn more than 30,000 euros per year. By applying this modification the Government could collect 11 MEUR in 2018, negotiators estimate. CUP also aimed to increase income tax for those who earn more than 60,000, but this proposal is not apparently on the table.

The Catalan Government’s total projected spending for 2016 amounts to €23.7 billion, 1.5% higher than last year’s bill and sets a deficit equivalent to 0.7% of Catalonia’s GDP, the same as that for 2015. Catalan Vice President and Minister for Economy Oriol Junqueras handed the proposal this Tuesday to the Parliament’s President, Carme Forcadell.According to Junqueras, the 2016 budget is “the most realistic and social-oriented budget ever”. After presenting the draft, Junqueras met with representatives of all the groups in the Parliament except for pro-independence radical left CUP. The anti-capitalist group, who have a ‘stability agreement’ with the governing party, declined the invitation in protest against the police baton charge that occurred this past Monday in Barcelona’s Gracia neighbourhood after the eviction of a social centre.

International tourists spent €713 million in Catalonia this past January, which represents nearly 18% more than what they spent in the same period last year. In Spain as a whole, international tourists spent more than €3.712 billion in January, which despite representing a 3.6% increase compared to the same month last year, is much lower than the rise registered in Catalonia. In fact, according to data released by the Spanish Statistics Institute (INE), Catalonia is the only region in Spain in which the average spend per person grew in the first month of the year. The average spend registered in January totalled 958 euros per person, 1.3% more than in January last year, while the daily spend per tourist was 159 euros, 16.7% more than in the previous January.

The number of public employees in Catalonia has been reduced by 4.76% over the last year, while in the whole of Spain the reduction was of 3.97%, due to the budget cuts in the public sector. However, the number of civil servants in Catalonia was already significantly lower than the Spanish average, according to a study issued by the SME association PIMEC. In January 2013, there were 40.7 civil servants for every 1,000 inhabitants in Catalonia, while the Spanish average was 57.4 and it reached 79.6 in the Autonomous Community of Extremadura. In fact, 26.7% of the Extremadura’s workforce is employed in the public sector, while the percentage drops to 11.1% in Catalonia. PIMEC stated in its report that, if Catalonia had the same proportion of public employees as the Spanish average, its unemployment rate would drop from 24.5% to 20.5%, with 150,000 fewer jobseekers.

Barcelona is overcoming the effects of the economic crisis. So says, the President of Tourism of Barcelona, Joan Gaspart, who revealed spending by tourists in Barcelona in 2011 came to on average 741 euros, 124 euros more than in 2010. In the first six months of 2012, the number of tourists has increased by 1.69%, overnight stays by 2.26%, and credit card spending has increased by 27.08%, compared to the same period of 2011. Gaspart stressed that these increases, although "modest", show that the industry "is doing a good job" to the point where predictions given for the second half of the year also indicate an improvement.

The Catalan Government has announced the deficit for last year was 3.29%, short of the 2.66% target set by Barcelona. The Catalan Minister for the Economy, Andreu Mas-Colell, has praised citizens for having tightened their purse strings, and says Catalonia is on track to meet is 1.3% deficit objective in 2012

Visitors from the United Kingdom were the highest contributors in June, spending 1229 million. Germans follow, with a total expenditure of 900 million euros while French tourists, with 514 million euros, increased their cumulative expenditure by a surprising 16.4%

After the presentation of the Catalan Government’s budget proposal at the Catalan Parliament, opposition parties criticised its content and the lack of debate on the subject. The Catalan Government needs support from opposition MPs or at least their abstention to approve the budget, which foresees a 2.66% deficit for 2011. The Spanish Vice President for Economy Elena Salgado insists that the mechanisms of deficit control “will be strictly implemented”.