The president of the Independent Authority for Budgetary Responsibility (AIReF), Cristina Herrero, has issued a clear warning on the importance of respecting the new budgetary rules established by the European Commission, stressing that the “credibility” of the Spanish economy is at stake and, by extension, the stability of the euro.
During a meeting with businessmen in Santiago de Compostela, Herrero recalled that at the last Eurogroup meeting, held on September 13, the need to restore confidence in the European fiscal compact was highlighted. In this sense, the leader of AIReF stressed the urgency for countries to present solid structural budget plans that allow this objective to be achieved.
“I hope that once the figures are published in the coming weeks, we can say that we are facing a good plan, that it is feasible and that there is the political will to carry it out,” added Herrero, referring to the execution of the Spanish budget plan in the European Commission, scheduled for October 15.
In recent weeks, the Authority’s president has reiterated that compliance with budgetary rules and financial sustainability are the “red lines” that define its scope of action. Herrero considers that his organization had already warned that, in order to comply with Brussels’ budgetary commitments, an adjustment of 0.4% of GDP would be necessary if additional measures were not taken to contain public spending.
“We are late”
The president of the tax organization regretted that AIReF has been asking administrations for a long time for a tax consolidation strategy in line with the new European guidelines. “We are late,” he warned, stressing that the deadline for sending the said plan expires this Friday. It should be noted that it is AIReF that will be responsible for assessing the coherence and viability of this plan, particularly in relation to the general budgets of the State.
In addition, Herrero stressed that administrations prepare their budgets with “very little information” on the commitments of the budget plan, and that it is essential that these budgets align with fiscal objectives.
AIReF will also be attentive to the objectives that the Spanish government will present to Brussels, ensuring that they are “coherent and compatible” with the requirements of the European plan. Herrero expressed concern that key reforms, such as those of the regional financing system or the stability rules, are being addressed in a “fragmented” manner, which, in his opinion, does not facilitate economic stability.
Finally, the president called on all administrations, both those of the central government and those of the autonomous communities, to act responsibly.
