Wave of massive budget cuts batters cash-strapped regions

The Balearic Islands, Navarre and Valencia are the latest regions that have moved to swing the budget ax anew as governments embark on a series of painful cutbacks, mostly in the areas of health and education, in order to bring down their skyrocketing deficits.

The big scissor slashes come almost a month before the general election campaign officially gets underway, but the two major parties, the Socialists and Popular Party (PP), are already engaging in pre-election accusations over the dire financial health of the country's regions.

In the bigger scheme of things, King Juan Carlos admitted on Wednesday that Spaniards are going to have to make "a lot of sacrifices" to help the country get back on its feet.

The IMF and World Bank both agree that one of Spain's biggest problems is trying to put a cap on runaway spending in the regions.

The biggest slash is being planned in Valencia, where the PP government is looking at 1.5 billion euros in budget cuts for next year, including a 10-percent reduction of its 150,000-employee payroll. "The situation is unbearable," admitted José Manuel Vela, the commissioner for economy and public administration.

Valencia's last budget projected some 13.7 billion euros in revenues, which will now drop to 12.2 billion euros next year - a figure lower than its 2007 budget.

In the Balearic Islands, the PP government there plans on either eliminating or merging its 168 public companies, which will affect about 800 workers.

Regional premier José Ramón Bauzá didn't want to offer any details on the cutbacks, including how soon they will go into effect. The islands' government wants to scale back its publicly owned corporations and entities to a total of 76. Bauzá has already announced that he won't renew contracts for temporary employees, mostly in the areas of education and health.

In Navarre, the government on Wednesday approved some 190.6 million euros in spending cuts for this year. Regional premier Yolanda Barcina of the Navarre People's Party (UPN) asked residents for "comprehension."