The “no” of Congress to the objectives of deficit and debt of the government makes it almost impossible to approve new budgets. This forces Sánchez to govern by increasing tax collection and 31 billion what we expect from European funds. If the new addendum that the Executive will send to Brussels is approved.
Once fallen in the second vote, stability path proposition, the law obliges us to govern with what existed until now. It is a question of continuing what was sent last year to Brussels, which reduces CCAA spending options by a tenth of GDP, and increases the state margin by an additional tenth.
Despite its failure, Maria Jesus Montero will experience an increase in collection of more than 8% in 2026 (nearly 350 billion) to manage public funds, a spending ceiling at the historic high of 212.026 million and the windfall that remains to be expected to arrive from New generation.
With these millionaire wickers to constitute the public coffers, the intention declared by the Minister of Tax authorities is to present a budgetary project as quickly as possible, even if the new deficit and debt references are not marked.
The situation is complicated for the LACC, which will be obliged to have a zero deficit in 2026, compared to the margin of 1.75 billion red figures offered to them by the Government’s proposal.
Over the entire period 2026-2028 which marks the path to stability, the margin narrows by almost 5.5 billionas the minister reminded (and reproached) the Congress, the opposition manifested by PP, Vox and Junts.
Fortunately for the executive, the spending limit It is not subject to a vote by Congress. Of course, Junts has already warned that he does not intend to support the budget that will be presented at the beginning of the year.
This leads the government to third consecutive budget extensionif some are not called before general elections. With the margin left by the collection and the EU funds, the Treasury will be able to spend the State’s liquidity according to the programs of the 2023 accountsthe latest ones that have been approved, with the necessary adaptations, increases and improvements.
With this scenario, already planned by the Executive, the President Sanchez He has already repeatedly shown his willingness to move forward even if there are no approved budgets for 2026, in what is already considered the last part of the legislature. All he has to do is close the management of European funds.
“Expenditures are increasing because pensions, public salaries, investments in the green transition, housing and infrastructure are increasing,” the minister argued, among other things, to Congress when ratifying the planned ceiling, despite the absence of deficit and debt targets.
Treasury calculations even raise this public spending ceiling by 4 billion (216.178 million), thanks to the expected contribution from the Next Generation until August, the month in which the program ends.
Addendum in progress
But for these funds to arrive, the European Commission accept the new final addendum that the Ministry of Economy is currently negotiating, during which the steps and measures that the government must comply with are significantly reduced.
In the last part of the European windfall, more than 60 billion credits were canceled (which were left out of the market), but the objective is to reach 100% non-refundable grants.
The four payments planned so far will be reduced to just two, for a total amount of €31 billion. One request will be made in January and the other just before summer, to arrive on time.
In addition to this, Brussels must approve new conditions in the addendum, which have been lowered from 257 to barely a hundredwith fewer legal and policy requirements. Mostly quantitative in nature.
In fact, the idea is to eliminate from the final list anything that involves entry into force of laws (more than half a dozen pending), due to the difficulties that the government is experiencing in advancing some of them in Congress in just eight months.
The new addendum avoids all obstacles that could make it impossible to achieve the planned objectives of receiving all unpaid non-refundable funds.
Without a path to stability and budgets, any reduction in EU backlogs could be a huge political failure for a government stuck in its parliamentary minority.
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