First stone on the path of José Luis Escriva as governor of the Bank of Spain: Fernando Fernandezthe close advisor to the PP who had been tasked with leading the working group for reform the law on the autonomy of supervisorsabandoned this task before it even began. Instead, she will be the advisor Lucie Rodriguezwho has just arrived at the AIReF institution, responsible for preparing reform proposals.
Jose Luis Escrivá has reached Bank of Spain with the intention of reforming the standard that governs the supervisor, which has already existed for 30 years. Among the declared objectives is the strengthening of the independence of this century-old institution. However, other key issues of reform will concern how the governor will be elected and the extension of his term.
In his inauguration speech, the new leader of the banking supervisor proposed revising the Bank of Spain’s autonomy law, which dates back to 1994. In fact, Escriva had already ordered the creation of a working group which was going to be directed by Fernando Fernández.
However, his resignation led him to be Lucía Rodriguez, someone who worked with Escriva when he set up the Independent Authority for Fiscal Responsibility (AIReF).
In any case, the deadlines managed are tight. The working group will have to present these reflections or recommendations to the supervisor’s board of directors. Afterwards, will be raised to the parliamentary level and to the government itselfwhereas the reform of a law is a political matter.
Europe Press
The election of Escrivá as governor of the Bank of Spain has generated a heated controversy and, ultimately, another point of friction between the government and the opposition. But the truth is that The process of appointing the highest authority of the banking supervisor is usually controversial.. This is why the revision of the method of electing the governor is one of the keys to a possible reform of the law.
Currently, it is a decision of the President of the Governmentwho only has to communicate the name to the king. The parliamentary procedure is minimal: the Minister of Economy informs the candidate proposed to the Congress of Deputies, even if there is no vote. In short, a direct decision that requires neither consensus nor political agreements.
It is true that, Traditionally, the government and the opposition agree the names: while the Executive was in charge of finding the governor, the opposition did the same with the vice-governor. The goal was that, even if each name could be closer to one or the other, there would be consensus on both.
Nevertheless, It’s not a foolproof formula.largely because it is still a tradition. Already with the appointment of Pablo Hernández de Cos in 2018, Rajoy’s PP jumped this procedure by electing him without agreement shortly before being expelled from La Moncloa by Pedro Sánchez’s motion of censure.
José Luis Escriva, governor of the Bank of Spain, with his predecessor in office, Pablo Hernández de Cos, during the former’s inauguration.
Reuters
Madrid
In any case, we will have to wait to see if one of the reflections that the working group formed at Escrivá’s request could propose is a revision of the election process for the leadership of the Bank of Spain.
The same applies to the term of office of the governors of the Spanish supervisor. According to the 1994 standard, The term of office is six years, without the possibility of renewal or extension.. In fact, when Hernández de Cos’s term ended, the position remained vacant until the government decided to complete the renewal process.
Reuters
Madrid
In the European environment, The Spanish case is a rare birdThe terms of office of the governors of the central banks of France and Germany are also six years, but in both cases, renewable.
Meanwhile, the president of the European Central Bank (ECB) has a longer mandate, eight yearsalthough not renewable. For its part, the presidential mandate of Federal Bank (Germany) also lasts 8 years and is also renewable.
In this case, another reform proposal on the horizon would be an extension of the term during which the governors of the Bank of Spain exercise their functions, either by a longer period in itself or by allowing a renewal.
In the current context of political fragmentation, the approval of any norm seems complicated, even if specific agreements have been reached. Another debate would be whether an extension of the governors’ mandate would also affect José Luis Escriva. That is, if the law changes, the former minister will be able to extend his stay in the main office of Alcalá, 48.
