General idea
As we all know, the main tool of this government is public spending, and these 10 measures are proof of that.
The aim is to mobilise 72 billion euros from the recovery plan (let’s remember previous posts where it was agreed that Spain was due a total of 140 billion euros).
What is happening?
Through the measures we will see below, the aim is to create 800,000 jobs in Spain over the next three years, as well as increasing GDP by 2.5 points per year.
In principle, Sánchez is only going to use the capital that comes in the form of subsidies, and the rest will be used by mid-2023.
Among the main measures we have:
- 16% – Urban and rural agenda and fight against depopulation. It is worth mentioning a little, it intends o carry out a comprehensive plan for housing rehabilitation and urban regeneration.
- 12% – Resilient infrastructure and ecosystems. 12%, to maintain natural habitats and everything related to environmental sustainability.
- 9% – Just and inclusive energy transition. Provision of more than 100 electric car charging points, as well as encouraging the creation of electric cars (in particular 250,000 vehicles).
- 5% – An administration for the 21st century. Modernising public administrations, with greater digitisation of these.
- 17% – Modernisation and digitisation of the industrial fabric and SMEs, recovery of tourism and promotion of an Entrepreneurial Spain. Again, little to mention, digitalisation of the entire productive fabric.
- 17% – Pact for science and innovation. Strengthening of the capacities of the national health system, acquisition of vaccines, reinforcement of primary care and renewal of health equipment.
- 18% – Education and knowledge, lifelong learning and skills development. With a digital training plan, reinforcement in vocational training, with the creation of digital classrooms in more than 19,000 centres, training for SMEs for their digitalisation.
- 6% – New care economy and employment policies.
- 1% – Boosting industry, culture and sport. Reindustrialise Spain.
- Modernisation of the tax system for inclusive and sustainable growth. Tax reform to raise public revenue once the crisis is over.
In addition to all these measures, the government has approved the spending ceiling at 196 billion, which would mean the highest debt of all time.
I don’t know about you, but in my education I was always taught that it was better to save than to squander, and this spending ceiling may be a little out of hand.
In any case, hopefully all these measures will be of real use to us, but it is true that in such a short period of time (3 years), it is very difficult to be able to manage all this large sum of capital in profitable investments.
Focusing a little on the proposed measures, it is true that some of them, such as the creation of 250,000 electric vehicles, do not make economic sense, as we do not really have an industry in Spain that excels in this sector, and in times of crisis I am not sure if families will be able to afford electric vehicles (currently so expensive) to be able to support this measure.
Moreover, as I said, we do not have major companies in electric cars to invest in them, so in any case such subsidies will be for foreign companies.
Conclusion:
And there are a few more examples like this, but this blog is not about evaluating the agreed measures, as they have not been broken down in depth, so we will wait for this breakdown to be able to give our opinion on them and see how they can influence us in this uncertain future.
