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The Parliament of Catalonia rejected a proposal to call for a “unilateral” self-determination referendum in the event that the Spanish State “blocked” the possibility of organising a vote by agreement. The motion was rejected with the votes of the Centre-Right Catalan Nationalist Coalition (CiU) – which runs the Catalan Government – and the three parties defending the unity of Spain: the Catalan Socialist Party (PSC), the People’s Party (PP) – which runs the Spanish Government, and the anti-Catalan nationalism and populist party Ciutadans (C’s). The motion supporting the idea of calling for a self-determination referendum in “a unilateral way” had been presented by the radical left-wing and independence party CUP, which has only 3 MPs in the 135-seat chamber. However it was also backed by the second-largest group, the Left-Wing Catalan Independence Party (ERC) and some of the MPs from the Catalan Green Socialist and Communist Coalition (ICV-EUiA).

The Catalan Government has presented its budget proposal for 2014, which posts a 1% deficit, representing a 35.5% annual reduction and amounting to €1.98 billion, in line with the 2014 deficit targets imposed by the Spanish Government. The budget prioritises healthcare, education and social policies, which represent 71% of the total non-financial spending. Non-financial spending grows by 0.2% and reaches €20.30 billion, while the total spending amounts to €29.31 billion. The Catalan Finance Minister stressed that spending had not been reduced this year since in the last 3 years it had already dropped by 22%. Budget cuts “have reached their limit”, as otherwise “social cohesion” and “the Welfare State” would “be at risk” he said. In 2014 the Catalan Executive will spend the same per inhabitant as it was doing in 2004 taking into account inflation (€1,901).The adjustment for 2014 focuses on increasing revenue by €3.2 billion, mostly through new taxes (€910 million) and the sales of assets and privatisations (€2.32 billion). On top of this, the Catalan Government forecasts a 0.9% economic growth for 2014, leaving behind the recession of 2012 (-1.2%) and 2013 (-1.1%).

The Spanish PM, Mariano Rajoy, considered that “to reform the Constitution in order to satisfy those who will not be satisfied”, referring to the citizens supporting Catalonia’s independence from Spain, who represent more than 50% of Catalans according to polls, would be “a great mistake”. Answering a question from the former Catalan President José Montilla, Rajoy stated before the Senate that “Spain and national sovereignty are not negotiable”. However, despite these red lines, Rajoy affirmed that his attitude towards Catalonia is “to talk” in order to find a negotiated way out. More than 80% of Catalans would like to hold a self-determination vote in Catalonia.

The Spanish Deputy Prime Minister, Soraya Sáenz de Santamaría made it clear that “members of the Spanish Government” and “members of the Generalitat [Catalan Government]” have been holding meetings in the past few weeks, including the Spanish Prime Minister, Mariano Rajoy. “We inform about some of them and about others we do not, out of consideration for the delicate subject”, she stated. Sáenz de Santamaría insisted that talks were just starting; “we are in an incipient phase”, she stressed, “to acknowledge that channels for negotiation have to be found”. However, she totally rejected the main demand from a broad majority of Catalan society, for allowing a self-determination vote to take place in Catalonia. The Deputy PM did not want to disclose any part of the Spanish Government’s strategy on how to handle the issue. However, she praised the figure of the ‘number 2’ of the Centre Right Catalan Nationalist Coalition (CiU), Josep Antoni Duran i Lleida.

The controversial Reform of the Education System continues its progress towards parliamentary approval, now in the Spanish Senate. The Catalan Education Minister, Irene Rigau, stated that with the new law – which “recentralises” and totally “invades” devolved powers – the Autonomous Communities are “delegations of the Central Government”. Furthermore, Rigau asked the Spanish Education Minister, José Ignacio Wert, “to be brave” and “eliminate” the Reform’s points regarding the language immersion principle. This Reform goes against the Catalan school model, which has been in place since the early 1980s and is backed by an almost-total consensus in Catalonia. Rigau pointed out that only 26 cases out of 1.2 million pupils in Catalonia had requested a different model than the one offered. According to her, changing the entire education system and the language equilibrium in Catalonia for 26 families is “abusive and counterproductive”.

In the last few days, there has been an attempt to build bridges between Catalonia and Spain, despite the visible increase of tension between the two governments. In public the Catalan and Spanish Executives are heading for a collision but at the same time discreet manoeuvres explore alternative ways out. This Tuesday, the ‘number 2’ of the Centre-Right Catalan Nationalist Coalition (CiU) – which runs the Catalan Government – Josep Antoni Duran I Lleida acknowledged that he met with the Spanish Prime Minister and leader of the People’s Party (PP) Mariano Rajoy on the 16^th October. Besides, the Catalan President, Artur Mas, met on Friday with the Secretary General of the Spanish Socialist Party (PSOE) to talk about a constitutional change. Today, the Spokesperson of the Catalan Government, Francesc Homs, stated that Catalonia is waiting for an offer from the Spanish establishment. Although “there is no deadline” for this offer, the self-determination process will not be waiting for it, although if it arrives it will be studied.

During the first two thirds of 2013, the Catalan Government deficit amounted to €2.05 billion, equivalent to 1.06% of Catalonia’s GDP. The figure corresponds to 67% of the 1.58% deficit target imposed by the Spanish Government to the Catalan Executive for the whole year 2013. Meanwhile, the entire Spanish public sector posted a deficit corresponding to 5.07% of Spain’s GDP in the same period, although data from municipalities is still pending to be included. The figure already represents 78% of the total 6.5% deficit target that the European Union allowed Spain for the entire year 2013.

The Spanish Prime Minister, Mariano Rajoy, and the President of the Catalan Government, Artur Mas, shook hands at the entrance of the Economic Forum of the Western Mediterranean. Mas wanted to welcome all the event’s participants since the forum is held in a Catalan Government building and is co-organised by the European Institute of the Mediterranean (IEMed), which is mostly funded by the Catalan Executive. However, in protest against the Spanish Government’s veto to authorise him to deliver a short welcoming speech, Mas did not stay to listen to Rajoy’s opening speech. Later today, in the Catalan Parliament’s government control session, Mas stated that “there are no protocol problems, but protocol impositions that generate problems”.

The tension between the Spanish and the Catalan Executives is increasing. The Spanish Government refused to allow the President of the Catalan Government, Artur Mas, to deliver a short welcoming speech to the participants of the First Economic Forum of the Western Mediterranean. This event will take place in Barcelona on Wednesday, within the headquarters of the Union for the Mediterranean Secretariat (UFM), a building owned by the Catalan Government. It will bring together 10 Ministers of Foreign Affairs and it will be part of the 5+5 Dialogue, which is formed by 5 EU Member States and 5 North African countries. The Spanish PM, Mariano Rajoy, will chair the meeting and he only allowed Mas to come as a part of his delegation, Mas will be permitted to join the meeting but not to speak. In similar meetings, presidents of other Spanish Autonomous Communities, including Catalonia, have been allowed to address participants.

The President of the Catalan Government, Artur Mas is the most senior public figure in Catalonia, just after the King of Spain and the Spanish Prime Minister. However, at Thursday’s scheduled dinner with the main Catalan business association ‘Foment’ and the Spanish Deputy Prime Minister, Soraya Sáenz de Santamaría, a last-minute change in the protocol put Mas in second place. The Catalan President considered that “conditions had changed” and as a protest he announced he was not going to the dinner. Instead, the Catalan Minister for Business and Employment was representing him. ‘Foment’ has been ambivalent regarding Catalonia’s self-determination process, although it supports the claim for finding a negotiated way out of the current political situation by organising a legal referendum.

The Spanish Government has sent a Budget Plan to the European Commission, following the new rules giving Brussels greater control on Member State finances. The plan’s scope includes all government levels in Spain. In the plan, the Spanish Government imposes a global budget adjustment of €8 billion on the Autonomous Community governments, including Catalonia’s, to be achieved within the next two years. €2.14 billion would come from increasing revenue next year, since Madrid considers that the Autonomous Communities can still increase their own taxes, particularly those linked to the environment. €1.93 billion would come from further budget cuts. This would total €4.07 billion in 2014, which would roughly be repeated in 2015.

One of the six ‘fathers’ of the Spanish Constitution, Miquel Roca, who currently leads one of the largest law firms in Spain, stated that the Constitution does not ban a referendum on Catalonia’s self-determination. “It is a matter of political will”, since Catalonia is recognised “as a nationality” by Spain’s main law, stated the respected lawyer, who also used to be a leader of the Centre-Right Catalan Nationalist Coalition (CiU). In front of a committee of the Catalan Parliament, Roca remarked that it would be “absurd” to call for a referendum at Spanish level, as it would only be binding in Catalonia. In the rest of Spain it would not be binding, emphasised Roca, as “it is said in Article 92”. This article reads that non-binding referendums can be called regarding issues of extreme importance.

The Catalan Government has published a report listing all the Spanish Executive’s disloyalties towards Catalonia including not respecting legislation, devolved powers and cultural aspects. The 50-page document has a chapter quantifying the costs of such disloyalty, which totals €9.375 billion, according to the Catalan Government. €5.748 billion correspond to infrastructure which has not been built; €672 million to a reduction in institutional transfers; €1.715 billion to spending increases due to the Spanish Government’s unilateral decisions; and €1.239 to revenue reductions due to similar unilateral decisions which have never been compensated. The report does not take into account the so-called fiscal deficit – the €16.5 billion that each year Catalan tax-payers transfer to the rest of Spain. The Catalan Government emphasised that there has been “a permanent disloyal activity” since 2000.

The Catalan Government will receive €1.7 billion less from the Spanish Liquidity Fund (FLA) in 2013 than had been previously foreseen. The news was announced by the Spanish Government in mid-October, with only 10 weeks left before the end of the year. Madrid has justified the decision by linking the FLA to the plan to lend money to public bodies in order to enable them to pay suppliers. The money to pay suppliers will now be deducted from the FLA, changing the previous conditions. As a consequence, the Catalan Government will not be able to fund the 1.58% deficit it had allowed, since the FLA is its only access to liquidity. Now, Catalonia will only have money for the previously-foreseen 0.7% deficit. The Catalan Executive feels “tricked” as “it is not understandable that the Spanish Government agrees to a greater deficit and later cannot fund this deficit”.

The People’s Party (PP), which runs the Spanish Government, used its absolute majority in the Spanish Parliament to pass a controversial reform of the Education System, which is not supported by the teachers’ unions or the rest of the political parties. Among several aspects, the new law goes against the Catalan school model, based on the linguistic immersion principle, which guarantees that all pupils master both Spanish and Catalan by the end of their studies, ensuring equal opportunities. The reform is the personal project of Spain’s Education Minister, José Ignacio Wert, who used to collaborate in far-right television channels. The Catalan Education Minister, Irene Rigau, confirmed that she will take the new law to the Constitutional Court and stated that the reform will not be implemented in Catalonia in 2014.