Since the last real estate and financial crisis which affected millions of people, there has been increased attention to the decisions and policies carried out by the European Central Bank (ECB) and the central banks of each member country. great interest from the public. Public opinion shows a growing awareness of the implications that its policies have on the daily lives of citizens. This oversight of the actions of banking regulators must also be subject to review and control by representatives elected by popular sovereignty, as part of their performance and work as servants of the citizens.
It is in this context of control that several deputies of the Sumar plurinational parliamentary group took legal action before the National Court last September to force the Bank of Spain (BdE) to account for the information it has, bank by bank, on public money. which were transferred to them as interest for the deposit of their reserves with the said institution during the years 2022 and 2023, and which had previously been refused by the BoE on the grounds that this data was subject to secrecy. professional.
The importance of this request before the Court lies in the usefulness of this detailed information to properly design tax policy, for example, to adapt the temporary tax on banks which, at the end of this year, will have to be converted into permanent tax. . The amount to which we are not referring is not small, around 8 billion euros were obtained by credit institutions in 2023 by leaving their liquidity in the BoE deposit facility. This represented 65% of the profits obtained by these banks in Spain, as well as a loss for the BdE itself.
It should be remembered that the revenue of 2 billion that the BdE usually makes annually to the Treasury, from its profits, was reduced to zero last year, which resulted in a significant reduction in the financing possibilities of public initiatives. This is a large amount of money which should be subject to strict control since it is private bank profits derived from a transfer from the public sector. Likewise, this information would give transparency to the stock market and would be very useful for investors, because it is not equivalent, when investing, a bank which derives 65% of its profit from the deposit facility, than another in which 65% of the profits come from loans to households and businesses.
The lawsuit against the BoE is based on rocky legal arguments, even though the right to obtain information is internationally recognized as a fundamental right, inherent and essential to freedom of expression; This is stated in Article 42 of the EU Charter of Fundamental Rights and Article 10 of the European Convention on Human Rights, in accordance with the case law of the European Court of Human Rights. Furthermore, at the national level, the Constitutional Court has repeatedly considered that the right of parliamentarians to obtain information is a legal right integrated into the content of Article 23 of the Constitution and therefore constitutes a fundamental right.
After an initial negative response to the deputies, hiding behind professional secrecy, the BoE is now asking the Court to reject the request on the basis of a letter sent by the all-powerful European Central Bank, in which it argues in a tone direct and veiled blasé. with Spanish justice, that monetary policy, to be effective, must be opaque, that is to say that it must be carried out in secret, although it is financed by public money. With its argument, the ECB would give this money the status of “reserved funds” for something which obviously does not have one.
This in turn conflicts with a fundamental principle of efficient markets, namely transparency. Perfect and symmetrical information for all participating agents guarantees market efficiency. Well, the ECB wants its monetary policy financed by public money to work outside the economic theory of efficient markets. According to the ECB, for monetary policy to be effective, private investors, for example, must operate with partial information, just like public officials responsible for designing fiscal policy. Obviously this doesn’t make any sense. The ECB cannot base a policy as important as monetary policy on the secrecy and dissemination of information with which the markets operate. It is neither solid nor coherent.
It is also wrong to claim that providing information, from bank to bank, on the transfers of public money they receive from the deposit facility would amount to stigmatizing the latter. First, because the individual volume of this transfer can be approximated based on the size of each bank, several estimates have been published in this regard, without it being known that this has dissuaded any entity from placing its liquidity in the facility .
Second, because there are already banks that publish this information in their reports, the stigma theory does not seem very strong. Along the same lines, certain countries, such as the United Kingdom, have requested this same information directly from banks through their Parliament. Obtain a positive response and without this resulting in stigmatization of the Bank of England deposit facility.
And thirdly, because even if it were true that revealing what was achieved by each bank would make monetary policy less effective, it would only mean that this instrument is not effective enough and that the ECB would have to resort to another one. – or in combination with another -, for example, the regulation of the volume of credit.
Despite the force with which the BoE and the ECB present their arguments to deny the information, the prosecution of the National Court expressed in a recent letter its favorable position to estimate the request, despite knowledge of the writings of our central bank and that of the ECB. Thus, the public prosecutor criticizes that the contested agreement of the BoE does not sufficiently motivate its refusal to provide the requested information and is limited to “offering a formal justification by invoking the attack on the ‘ease of deposit for monetary purposes’ and to ‘professional secrecy’. .’ “, referring to regulations under European law, while these regulations “do not regulate, prohibit or prevent banking information likely to constitute professional secrecy from being provided to deputies of national parliaments when they are collected in the exercise of their functions. parliamentarians. »
Furthermore, the prosecution recalls that “the fundamental rights guaranteed in the two sections of art. 23 EC embody the right of political participation in the democratic system enshrined in art. 1 EC and constitute the essential form of exercise of sovereignty by all citizens”, this is why it asks the Contentious-Administrative Chamber of the National Court to annul the resolution of the BoE because it represents a violation of the fundamental rights of citizens, through their parliamentary representatives, to access and participate under conditions of equality in public affairs, functions and positions, in their functional aspect of access to information from public authorities.
We obviously share the position of the public prosecutor and the well-founded support it has given to our demand, which is none other than that of guaranteeing the public interest. All we have to do is wait for the decision adopted by the National Court, which, we understand, must be fully consistent with the principles of transparency and good governance and subject to the interests of popular sovereignty.
