The Congress of Deputies approved this Wednesday the stability path for the period 2024-2026 -with the deficit and debt targets for the State, autonomies, city councils and Social Security -, which is the previous step for the preparation of the 2024 Budgets. The stability objectives proposed by the Government will now go to the Senate where it is expected to be rejected by the absolute majority of the PP since, in this Wednesday’s vote they have already voted against.
The Government’s agreement with the path of stability has been approved by 179 votes in favor and 171 against (PP, Vox and UPN) in a second vote by appeal after the first registered a tie of 171 votes because neither Junts voted (which has now done so in favor) nor, by mistake, a deputy from Sumar.
Along with the path of stability, the first vice president and Minister of Finance, Maria Jesus Monterohas defended the spending ceiling for 2024 -a historical maximum of 199,120 million, 0.5% more-, which is not put to a vote, as well as the rebalancing plan to channel finances towards a deficit objective of 3% of GDP, which has also been approved by 179 votes in favor and 171 against.
The path of stability presented by the Government foresees reduce the public deficit to 3% of GDP in 2024, thus meeting the reference of the Stability and Growth Pact of the European Union, and advancing in this correction in 2025 (2.7% of GDP) and 2026 (2.5% of GDP). According to the path described by the Government, the debt of all administrations will drop to 106.3% of GDP in 2024, 105.4% of GDP in 2025 and 104.4% of GDP in 2026.
Blockade in the Senate
Predictably, the path of stability that has managed to move forward in the Congress of Deputies will run aground as it passes through the Senate, where the rejection of theabsolute majority of the PP It would mean its return to the Government, which will have to present a new proposal within 30 days.
The Government defends that the presentation of a second path allows him to present the 2024 budget project even without the objectives having been approved by the Senate.
In this case, the Government would take as a basis for the preparation of the 2024 Budgets the path that it sent to the European Commission in April, within the Update of the Stability Program. That path does not change the global objective of a deficit of 3% of GDP by 2024. However, it does change in the distribution by administrations, which translates into more demanding objectives for autonomous communities (balance instead of a tenth of deficit) and city councils (two tenths of surplus instead of balance).
During the parliamentary debate this Wednesday, Montero has criticized the PP that its eventual rejection in the Senate of the path of deficit and debt proposed by the Government will result in a “greater economic asphyxiation” for communities and town councils than the one proposed by the Government, since they will have to adjust to objectives that are even tougher than their own. regional and local governments have taken as a reference in their budget projects for 2024.
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Both the stability path As the spending ceiling They are the previous step to the preparation of the 2024 Budgets in which the Government “works very intensely” so that they arrive “as soon as possible” to Congress and that they will advance on the “path of progress, support for the productive fabric and commitment for intelligent reindustrialization,” Montero defended in the Senate gallery (where the debate was held, as the Congress building was under construction). The Government’s purpose is to approve a Budget project in the first quarter of the year.
The Government intends to make its economic policy objectives compatible with the sustainability of public accounts once European fiscal rules are reestablished, added the minister and fourth vice president. Montero has highlighted the commitment to balance that the Executive has maintained even when these rules were suspended, since the head of the Treasury expects to close 2023 with a deficit of 3.9% of GDP as had been committed to Brussels.