Regional finances foster debate on territorial map

The blowout in the finances of Spain’s regions in the past two years has fanned the debate about the rightness of Spain’s semi-federal structure under which big-budget items such as education and health have been devolved from the center to regional administrations with limited revenue-raising powers.

In a debate on Wednesday in Congress, Prime Minister Mariano Rajoy spoke of the need to rethink what services should come under the jurisdiction of the central government and which should be the bailiwick of the regions. His finance minister, Cristóbal Montoro, later took on the baton, arguing that: “We won’t get out of this crisis if we don’t reorganize the distribution of powers.”

Arguing the country faced a “political crisis,” Rosa Díez, the leader of the center-right UPyD called for a “refounding” of the state through inverse devolution, referring to an “undefined territorial model that has left the government of the nation bereft of essential powers.”

In response, Rajoy agreed that there were too many overlapping areas of jurisdiction, and made it known that a report on eliminating some public companies, institutions and organisms was being readied for the Cabinet’s attention over the next few weeks.

Spain undefined territorial model that has left the government of the nation bereft of essential powers.”

Montoro, however, insisted that the elimination of such overlaps would not in itself imply rewriting the territorial map. “A decentralized Spain is not a byword for waste,” the minister said. “This is Spain’s model, one that corresponds to a modern, politically decentralized Spain.”

Warming to his task, Montoro accused Díez of being a “nostalgic” for centralization. “We haven’t made a mistake with the model of the country,” he said. “The most efficient countries in Europe are federal.”

Tuesday’s debate took place a day after a tense meeting of the economic commissioners of Spain’s 17 regions and members of the central government, in which Madrid imposed painful cuts to limit the regional budget deficit to 1.5 percent of GDP this year after overspending caused the state to badly miss its deficit target last year.

Andalusia, which is controlled by the opposition Socialists, voted against the limit, while the Canary Islands and Catalonia, which are in the hands of regional parties abstained. The 11 regions held by the ruling Popular Party toed the official line.