Gathered for the last council of ministers of the year, and less than a year from the next general elections in Spain, the government has also decided to grant aid of 200 euros to the most modest families.

These are the two flagship measures of a new anti-crisis aid package worth 10 billion euros, which brings to 45 billion euros the total of the measures taken this year by the government of Prime Minister Pedro Sánchez to help Spaniards cope with the explosion of inflation largely resulting from the conflict in Ukraine.

Compared to previous aid packages, which primarily targeted energy (electricity and gas), the measures taken on Tuesday are centered on food products, the rise of which over one year reached 15.3% in November.

During the next six months, "VAT will drop from 4% to 0% for all basic necessities", such as bread, milk, cheese, fruit, vegetables or cereals, said Mr. Sánchez during of a press conference.

VAT on oil and pasta will drop from 10% to 5%.

The other shock measure adopted on Tuesday morning relates to the establishment of aid of 200 euros, paid once, for the benefit of families whose income does not exceed 27,000 euros per year, in order to "compensate for the rise in prices food products," Sánchez explained.

Since the Russian invasion of Ukraine on February 24, the Spanish government has multiplied aid to help the poorest households cope with inflation, which has exploded throughout Europe.

After peaking at 10.8% in July, its highest level in 38 years, inflation has gradually slowed down to 6.8% in November.

But this decline does not yet affect the food sector, whose prices continue to climb.

“Late and insufficient”

The measures taken during the year by the executive ending on December 31, the government had to decide this week on their possible continuation.

The head of the Spanish government Pedro Sanchez (socialist) details a series of anti-inflation measures, at the Moncloa Palace, in Madrid, on December 27, 2022 © Pierre-Philippe Marcou / AFP

Mr. Sánchez thus announced the extension for six additional months of a VAT rate reduced to 5% on electricity and gas.

Similarly, the shutdown of basic services for the most vulnerable who cannot pay their bills will remain prohibited in 2023.

In the field of housing, Mr. Sánchez announced the extension for an additional year of the 2% limit on the increase in rents, normally adjusted annually by an amount equal to that of inflation.

And evictions remain suspended for the next six months.

This was a demand from the radical left party Podemos, a partner of the Socialists in the government coalition.

Likewise, the reduction in urban public transport fares is maintained for the whole of 2023.

On the other hand, the rebate of 20 centimes per liter of fuel, which all motorists currently benefit from, will be reserved, from 1 January, for the "sectors most affected" by inflation, namely transporters, farmers, maritime and fishermen," said Mr. Sanchez.

These measures come in a very tense political climate, less than a year from the next general elections, which will take place no later than December 2023.

They immediately aroused criticism from the main opposition party, the People's Party (PP, conservative right), which the polls give in the lead if the elections were held today.

"Late and insufficient", judged the secretary general of the PP, Cuca Gamarra, about this aid.

Mr. Sánchez had anticipated these criticisms by assuring, with the support of a graph, that "Spain has reduced inflation like no other European country".

© 2022 AFP