Catalan premier calls on rich to help with deficit

Catalan premier Artur Mas on Tuesday defended his cash-strapped administration's drastic cuts to social spending and argued for the need for a temporary tax on the rich as his government approved a regional draft budgetary stability law.

Mas said the 850 million euro overshoot in spending last year was "unsustainable" and needed to be corrected, without endangering the quality of services provided. The government posted a public deficit last year of 4.2 percent of GDP, well above the limit imposed by the central government.

The Catalan government has slashed staffing levels at hospitals and reduced services, and on Monday proposed that healthcare workers accepted a 50-percent cut in their Christmas bonus. The budgets for education and social services have also been shaved. The measures announced on Tuesday include a two-month freeze in transfers to private-public care centers for the retired and other groups with special needs.

The draft law approved by the government on Tuesday prohibits the regional government exceeding a budget deficit of 0.14 percent GDP from 2018. The central government plans to approve legislation that imposes that limitation from 2020 onwards.

The regional commissioner for economic affairs, Andreu Mas-Colell, says the move underscores the government's commitment to budget stability. The draft law, which the government wants the regional parliament to approve before the end of the year, allows for the deficit and debt limits to be surpassed only in cases of natural catastrophes or economic recessions.