The most problematic and complex reform on the map of greatest instability, due to the difference in political color between the future state government and the autonomous communities, can generate a virtuous moment to address the regional financing.
As happens at the beginning of each legislature, this issue is once again at the forefront of the challenges that an eventual Executive must face (who, according to forecasts, will preside Pedro Sanchez in coalition with Sumar). It was in the last legislature and, despite the numerous debates that were generated (especially with the tax battle between Isabel Díaz Ayuso and the Government), the reform did not leave the drawer in which it has been kept since 2009, when it was last modified the system.
Now, the dilemma of regional financing returns with force and is one of the main elements in the negotiation between the PSOE and Sumar to close a programmatic agreement for the legislature. Those of Yolanda Diazwith Nacho Álvarez at the head of the negotiations, consider that it is a necessary and unavoidable reform to structure the State territorially, and ask that this commitment be clearly included in the Government pact.
In Sumar they defend that the fiscal harmonization of the territories has to serve two specific issues: guarantee sufficient resources to finance public services in communities (especially poor health after the covid-19 pandemic) and close, to the extent possible, the economic and social gap between rural and urban environments, towns and large cities.
In the socialist wing of the Executive they recognize that the issue of regional financing is one of their thorns in the side during the last legislature. “An important consensus would have been necessary around the new financing system. It is something that has been pending since 2014,” said the Minister of Territorial Policy, Isabel Rodriguezin an interview with Public a few months ago.
In the PSOE they also bet on a “fair financing system” that guarantees cohesion in all territories, equality in the perception of these basic services and where those who have the most, have to contribute the most to guarantee that cohesion. Already at the beginning of August, the Minister of Finance, Maria Jesus Monterospoke of the “urgency” of renewing an outdated model.
The socialists, according to government sources consulted, are determined to address this reform during the next legislature. Its objective is also to put on the table in hypothetical negotiations the inheritance tax. An issue with which the right has waged a political battle for its bonuses and reductions against the opposite intentions of the coalition government.
The key factor of the PP
In this sense, there is a paradox that has to do with the context and the current political moment. According to all forecasts, it is very likely that Sánchez and Díaz will revalidate the coalition Executive and that the progressive forces will govern the State during the next legislature. However, it is the PP (in some cases in coalition with Vox) that holds territorial power after sweeping the regional elections last May, after which it managed to govern in 11 of the 17 communities.
This map leaves a counterweights scenario between state and territorial power in which a framework of competition could be generated and where regional financing would be one of the main workhorses. But the situation not only has to do with the political color of each sphere or area.
The blatant underfunding of communities like Country Valencia, Galicia or Andalusia It collides head-on with territories that are very well located in terms of resources, such as the Community of Madrid. Autonomous presidents of the PP such as Juan Manuel Moreno Bonilla, Alfonso Rueda or Carlos Mazón have publicly expressed their discomfort with this situation and their intention to address this reform, even if this means calling into question the current status of the region governed by Isabel Diaz Ayuso.
Far from giving up, in the socialist ranks they consider that it is possible to agree on a comprehensive reform with the PP. At the same time, they recognize that “there is still a long way to go” and that the autonomous communities continue in positions of maximum.
The socialists in a certain way transfer the pressure to the popular ones, of whom they say that “It is difficult for them to opt for a single position”. The ball, therefore, is also in their court. “If Galicia, Andalusia or Madrid are able to agree, it would be on track,” the Government says. The internal tensions in the ranks of the PP, with Ayuso on the rise, is another factor that the PSOE puts on the table.
A reform of regional financing that distributes resources more equitably and puts the territories that are at the bottom in a better situation can be sold as a victory for the regional presidents of the PPwho have to negotiate in two areas or levels: with a possible state government of PSOE and Sumar, on the one hand, and between them, with the rest of the regions, which also have mostly right-wing executives, on the other.
Political colors are blurred on a map where, for example, Galicia will hold elections next year. As a second element, it can also be taken into account that the state Executive, if it is formed, will have a situation of greater parliamentary weakness than everwhich has given rise to nationalist and sovereigntist forces from territories that they also consider to suffer a grievance in terms of resources, such as Catalonia, to have more political weight and potential capacity for influence.
For Together and for ERCregional financing is also a fundamental issue and, although at the moment it is not part of the negotiations for Sánchez’s investiture, it cannot be ruled out that at some point they will link their support for the future Government to the commitment to face this reform.
