The Minister of Finance seems to have found the key to deactivate a more than possible veto of the PP in the Senate to the spending ceiling essential to prepare the General State Budgets of 2024. The fourth vice president, María Jesús Montero, revealed this Monday that if the Upper House rejects the stability objectives approved by the Government, those that were sent to Brussels last April would be applied instead.. This is stated in a report from the State Attorney's Office that is in the possession of the minister.. In this way, the Government could overcome one of the major obstacles that made it difficult to process the budgets for next year.

The Government began the processing of public accounts three weeks ago with a significant obstacle in the way. The absolute majority of the PP in the Senate threatened to overthrow the stability objectives – the legal limit of deficit that the State, the CCAA and local entities can incur. The path of stability is an essential prior step to move public accounts forward.. But, unlike what happens with other legislative initiatives from Congress—which the Senate can veto but then the Lower House can unblock in the second round—stability objectives also require the yes of the Upper House.

However, the Treasury interprets that in the event of a veto on the deficit limits, the stability objectives that the Government sent to the European Union last April in the Stability Program would automatically be applied.. In this way, the Executive could continue with the processing of the Budgets even without a path of stability updated and endorsed by the Cortes.. If this interpretation of the rule is proven to be true, the Government would avoid having to reform the Budget Stability Law to remove the Senate veto. A cumbersome and complex process that would further delay the budget process.

Furthermore, the Government plays with another trump card to pressure the PP so that it does not use its veto in the Senate. And the deficit objectives that were sent to Brussels in April are more severe for communities and local corporations than those that the Government will take to the Council of Ministers this Tuesday.. Following this logic, if the PP vetoed the Executive's objectives, the regional governments—12 of them with popular presence—would see their spending capacity reduced.. “The PP would be throwing stones at its own roof,” summarized María Jesús Monero.

This is because the path of the Stability Program forces regional governments to close their accounts in balance and local entities to a surplus of 0.2% over GDP.. However, the Government's proposal places the limit at 0.1% of GDP for the CC AA and at 0% for local corporations.. If the permitted deficit limit narrows, so does spending capacity.

Likewise, Montero has stated that the hypothesis that without stability objectives there are no General State Budgets is a double-edged sword for the communities.. If this were so, he pointed out, the budgets of the autonomous communities “would be illegal”, having been approved without stability objectives.. “If the government cannot approve stability objectives, the budgets of all subsectors will fall,” said Montero.. “If they play to torpedo the budgets, I am not going to accompany them in that game,” he added.

Montero has reproached the communities governed by the PP for having voted against in the Fiscal and Financial Policy Council some stability objectives that are more favorable than those that would be applied to them if there is no agreement in the Senate. However, this negative vote will not be an obstacle for the Government to approve this Tuesday in the Council of Ministers the stability objectives and the non-financial spending ceiling for the State.