The implementation of the new Government's program sparks the deficit already in the first year of the "progressive coalition" with a record increase since the Zapatero stage and returns Spain to the special control of the European Union while violating Article 135 of the Constitution . This follows from the internal calculation made by the Department of Economics of the CEOE, to which EL MUNDO has had access.

This study service is one of the most gifted in the country and is directed by the former president of the National Statistics Institute (INE), Gregorio Izquierdo. «We estimate that if the measures of expenditure of the agreement that PSOE and Podemos have published are implemented, the expenditure will increase by around 1.5% of the Gross Domestic Product already in 2020 and revenues, by around 0.5% . That implies an increase of the deficit of 1% of the GDP already in this first year », confirms Izquierdo to this newspaper.

That equates to 12,000 million euros of additional imbalance - the largest increase since the Zapatero government in 2011 - and carries the deficit above 3%. "It does not fit with the stability rules of the European Union or with the Constitution," warns Izquierdo . On the one hand, overcoming that deficit ribbon means Spain's return to the so-called corrective arm of the European Stability Pact, which means returning to the special control of Brussels in which it remained between 2009 and 2018 and a discredit to the markets. On the other hand, it violates article 135 of the Constitution which, according to this newspaper published last day 3, enters into force precisely in 2020 in this section: «The State and the Autonomous Communities may not incur a structural deficit that exceeds the margins established, where appropriate, by the European Union for its Member States ».

The EU guideline is that the State achieves an adjustment of 0.65% of GDP this year, about 7.8 billion. However, the program presented at the investiture not only does not guarantee that adjustment, but, according to CEOE, quite the opposite. The president of the employers' association, Antonio Garamendi, yesterday called again to the new government "stability and moderation" in an interview on Antena 3 and warned of the risk that the deficit will be around 3% in this first year of the legislature. It can actually be overcome, because the starting point is getting worse. The 2019 State deficit will not fall to 2% as promised by the acting Minister of Finance, María Jesús Montero, and, pending the December execution data and last-minute tax engineering, the Ministry expects that, At least, it drops from 2.5% in 2018 to around 2.2%. The commitment made by Pedro Sánchez with the European Union is that it would lower the deficit in 2020 to 1.1%, but, from the forecast of CEOE it follows that it would end up around 3.2% .

Izquierdo warns of the difficulty of calibrating the true impact of the measures announced as they have not been accompanied by economic memory and some of them are periodized throughout the legislature. For its calculation it has taken into account only the most specific commitments. They include the revaluation of pensions and the elimination of the sustainability factor; the salary increase of public employees; the progressive increase in Health, Education and ecological transition; the gradual implementation of the minimum vital income; or the increase in official development assistance. On the income side, it has taken into account the rise in Corporation Tax, the increase to higher incomes and new taxes such as the Tobin Rate, among others. Garamendi doubted yesterday that all the tax increases announced to be counterproductive, in his opinion, will be applied to the economy.

The president of CEOE transferred to Sanchez after his investiture the willingness of the employer to collaborate, but asks him to take his plans of labor reform to social dialogue and to refrain from legislating on his own. However, he is skeptical of the whole plan: "Today they are ideas that are in a document, let's see which ones are going forward, " he told Efe.

According to the criteria of The Trust Project

Know more

  • CEOE
  • European Union
  • GDP
  • INE
  • Spain
  • PSOE
  • We can
  • Pedro Sanchez
  • Maria Jesus Montero

Catalonia The Generalitat focuses on financing Cantabria and Extremadura while claiming another 10,224 million from the State

ReactionsThe company, against the PSOE and Podemos pact, "closer to populism than to economic orthodoxy"

TaxationThe Google rate: everyone seeks 90,000 million in taxes from internet giants