José Luis Escriva will be the new governor of the Bank of Spain. The government places the current minister at the head of the monetary body, as reported by Cadena Ser and confirmed by elDiario.es, despite the rejection of the Popular Party (PP), which since July has described his candidacy as an attempt to politicize the institutions.
With the deadline for making the decision almost over, the Executive remains faithful to its first option, which was leaked to the media at the beginning of July and with which there had been speculation since Escrivá left the portfolio of Inclusion, Social Security and Migration in the previous coalition government to remain with digital transformation and the civil service in the new one, from November 2023. Many saw in this movement a step backwards to gain momentum, with precisely the Bank of Spain as a target.
Today, these projects are confirmed, and the Minister of Economy, Commerce and Enterprise, Carlos Body, will begin the procedure for his official appointment, announcing it this Wednesday to the sectoral commission of the Congress of Deputies. Then, it will be necessary to present a decree from the President of the Government, Pedro Sánchez, which will be published in the BOE and which will allow the candidate to take office before the King.
The minister’s spokeswoman, Pilar Alegría, did not want to confirm the appointment at the press conference after the Council of Ministers to be “respectful” of the deadlines. On the other hand, the ministry that Escrivá is leaving will not disappear and Sánchez is looking for a candidate to occupy the portfolio.
The election of Pablo Hernández de Cos’ replacement was another battleground between the PSOE and the PP. Ultimately, the decision is up to the government. However, political “custom” dictates that an agreement be reached with the main opposition party. Both the election of the governor and his second in the monetary entity. At the moment, it is not known who will occupy this position of deputy governor.
Since Escrivá’s candidacy was made public, the PP has refused to support him. “Under no circumstances,” said its secretary general, Cuca Gamarra, the party’s chosen negotiator. “We are not going to allow the manipulation or occupation of institutions.” “We need transparent organizations that are not managed by Sánchez’s ministers,” declared the Popular Party’s spokesperson in the European Parliament, Dolors Montserrat, in early August. On Tuesday, its leader Alberto Núñez Feijóo repeated: “You can’t be a minister in the morning and a governor in the afternoon.” The PP will only agree on an “independent” governor, said the party’s deputy secretary for the economy, Juan Bravo, on Monday.
From the first moment, Corps said that going from minister to governor “does not threaten” the independence of the institution, because independence is guaranteed by law. A line that the government as a whole has maintained in recent weeks. This Monday, the Minister of Economy announced in a television interview that the candidate whose identity has not yet been revealed has experience and a resume “more than adequate, in line with and at the level of the previous governor, or even above if “it is possible.”
Also on Monday, PP sources cited by Europa Press considered that the government did not want the support of their party to appoint the governor of the Bank of Spain, because if it had wanted it, it would have made another proposal. In addition, they believe that the Executive has sought to “distance itself” from the PP after the agreement on the renewal of the General Council of the Judiciary (CGPJ).
The truth is that moving from the Council of Ministers to the central bank is not an exceptional practice in the eurozone, not even in Spain. Luis de Guindos, Minister of Economy in Mariano Rajoy’s PP government, left his portfolio to become vice-president of the European Central Bank (ECB). Previously, the president of the institution herself, Christine Lagarde, already had experience as a minister of France.
Indeed, with Escriva, a third of the members of the ECB’s Governing Council, which makes up the governors of each central bank of each eurozone country and the organization’s executive board, have a background in their corresponding leaders. De Guindos and Lagarde are joined by the governors of the central banks of Austria (Martin Kocher), Greece (Yannis Stournaras), Malta (Edward Scicluna), Portugal (Mário Centeno), Slovakia (Peter Kažimír) and Finland (Olli Rehn).
In July, the Bank of Spain already lost the right to vote in the Governing Council of the ECB, the body that decides on the monetary policy of the eurozone, for having presented itself with an interim governor. The mandate of the previous governor, Pablo Hernández de Cos, expired in June, and that of the vice-governor, Margarita Delgado, who remained at the head of the Bank of Spain, expires on September 11. The next meeting of the Governing Council of the ECB will take place on Thursday, September 12, in which Escriva will already be the representative of our country.
New stage at the Bank of Spain
The Bank of Spain is an institution with more than two centuries of history whose main role – deciding monetary policy – is currently subordinate to the Eurosystem (the European Central Bank) but which fulfills a key mission in the supervision of financial entities and maintains an important muscle in its arm of analysis and evaluation of the economic situation and policies.
In recent years, the coalition government has been under scrutiny by the analysis department of this institution. The Bank of Spain has reacted to all (or almost) progressive economic policies. With some notable setbacks, such as criticism of the increase in the Minimum Interprofessional Wage (SMI) in 2021 or the reluctance to tax the extraordinary profits of banks when they are reaping historic profits and distributing record dividends, favored by the monetary policy itself.
