The Generalitat Advocates for a Population-Based Regional Financing System

The Valencian Generalitat will advocate in the Fiscal and Financial Policy Council (CPFF) for population as the basic criterion for the new regional financing system proposed by the central government. The regional secretary of Finance, Eusebio Monzó, has defended this criterion "because public services are provided to people".

Monzó has established the regional government's position in the debate body among autonomous communities. Each community supports what is most favourable to them, such as dispersion and depopulation in the case of Castilla y León, or ageing, as in Asturias. Each with their own interests.

The same reason leads the PP-governed communities to negotiate separately. The Popular Party governs 11 of the 17 autonomous regions, plus Ceuta and Melilla, from Galicia to Andalusia. A diversity difficult to homogenise. Moreover, the president of the PP, Galician Alberto Núñez Feijóo, favours depopulation as a factor to consider.

In this regard, the Valencian Generalitat will defend its own criterion, which they believe is more beneficial for one of the most economically mistreated regions under the current system approved by the PSOE with President José Luis Rodríguez Zapatero at the helm.

Neither the current system nor the one presented again by the PSOE, this time with Pedro Sánchez, benefits the Comunitat. On the contrary, they understand from the Generalitat, "as it creates spending needs differences per inhabitant of up to 16 percentage points compared to the current 11 points". From bad to worse.

"The proposal that the government has put on the table does not benefit the Valencian Community at all, because it is so open that, depending on how it is closed, it can further widen the unjustifiable current differences and further sink the Valencian Community," stated the regional secretary of Finance upon leaving the meeting.

The first mystery is how the Minister of Finance, María Jesús Montero, will resolve the unique financing of Catalonia with the principles of equality and solidarity. "No matter how much they try to confuse us, the system they propose cannot be unique and supportive at the same time, it cannot be multilateral and bilateral, and above all, it cannot give more resources to all autonomous communities when what we are talking about is the exit of Catalonia from the common regime," insisted the regional secretary of Finance, Eusebio Monzó.

For this reason, they have reiterated that taking adjusted population as a reference based on demographic and corrective variables "that are not transparent and without technical justification is risky because it generates significant financing differences per inhabitant between communities that are not justified" and have argued that these differences "should not exceed 5% regardless of the variables used and the weights assigned".

Additionally, the regional delegation has urged the Ministry of Finance to present a complete scheme of how the system would look as a whole to reactivate the reform, as they consider it essential to clarify whether the current secondary funds that "distort" the initial distribution of the Guarantee Fund will be maintained.

Otherwise, since the results of the financing model "depend on the set of variables that constitute a system," they warn that the Generalitat will not support any proposal of adjusted population "without knowing the rest of the elements of the new system" and without the immediate incorporation of a Leveling Fund that equalises these regions to the average.