Financing, once again a bargaining chip

All regions reject Pedro Sánchez's decision to grant greater tax privileges to Catalonia.

Aware of the Prime Minister's extreme weakness due to the judicial investigations into corruption within the PSOE (Spanish Socialist Workers' Party), his allies in the legislature are seeking to collect outstanding payments for their parliamentary support. Pedro Sánchez emerged unscathed from the delicate plenary session in Congress dedicated to the scheme orchestrated by Santos Cerdán, José Luis Ábalos, and Koldo García to extract bribes in exchange for public works concessions.

But spokespeople for minority groups made it clear to Sánchez that their support for the executive remains more than ever conditional on the fulfillment of the commitments signed for his investiture. The "unique financing" for the Catalan government agreed upon with the separatists emerges as one of Sánchez's most pressing demands, given that, according to what was agreed last summer with ERC, the agreement was to have been finalized by June 30th. However, the party led by Oriol Junqueras agreed to an extension until next Monday, when the bilateral commission between the two administrations is held.

The regional governments are not willing to bear the brunt of either the tax privileges sought by the separatists or the government's urgent needs. Hence, even the Socialist presidents of Asturias and Castilla-La Mancha have taken a stand against using the financing system as a bargaining chip to keep Sánchez in power. The Conference of Presidents held in Barcelona on June 6 demonstrated the unanimous support of the leaders of the autonomous communities under the common system against excluding Catalonia from the system due to the inevitable loss of resources it would entail for the others.

First Vice President and Finance Minister María Jesús Montero's promises that they would not be harmed by handing over the management of all taxes collected in the region to the Catalan government or by creating its own tax agency were unconvincing. Among other reasons, this is because the separatists have made it clear that their goal is to stop Catalonia from contributing to solidarity funds.

Left-wing groups, like Sumar, that have decided to maintain their support for Sánchez despite the corruption, justify it as ensuring the social advances of his term, but the president's administration is dedicated to granting greater privileges to one of the wealthiest communities in Spain.