The economic bungling of the Government and the anger of AIReF

The economic bungling of the Government and the anger of AIReF

If what we want is to give an image of a tambourine country before the European authorities, we are making it feten. It has been seen with the back and forth of the Government with its pension commitments included in the Recovery Plan that was signed with the European Commission. A very mediatic embarrassment that has a better solution than others. Specifically, that of the processing of a project of the General State Budgets (PGE) with a macroeconomic picture that Brussels disrupted this Thursday and that no national body believes.

AIReF’s discomfort with this issue is understandable. The Independent Authority for Spanish Fiscal Responsibility (which, by the way, was created in 2013 at the request of the European Union to guarantee the principle of budgetary stability that is incorporated into our Constitution and is suspended) yesterday sent a communiqué from the reading of which shows its logical concern at not being able to do its job well.

This organism – Jose Luis Escriva knows well because he was its president before becoming a minister – has the function of controlling the Government’s accounts. And the conditions under which he carried out this task with the Budget project being processed by Congress were not the most appropriate.

Remember the chronology of events. On Tuesday, September 21, the Bank of Spain was going to update its economic projections, when the vice president, Nadia Calvino, decided to present the macroeconomic picture that supports the Budgets. The Government maintained GDP growth for this year of 6.5% and promised an advance of 7% for the next.

Two days later, on Thursday, the INE recognized a unprecedented slip with a drastic reduction in its growth forecasts in the first half of the year (especially in the second quarter). By then, the Budget project was almost ready to deliver to Congress and the Government maintained its calendar (and its figures) to take them to Congress in the second week of October.

The macro table was endorsed by AIReF with unrealistic statistics on economic growth until June

The macro table was endorsed by AIReF with unrealistic statistics on economic growth until June. But, with the public accounts already in the Hemicycle, the president of AIReF, Christina Herrerowarned on October 25 of the need to lower forecasts to 5.6% this year and to 6.3% next. A fairly clear way to amend that guarantee, which is transcendental for Brussels.

So his discomfort with the INE is understandable, which he had asked -before this event- to advance the publication of its relevant statistics to avoid this type of ‘slip’ that has served the Government to inflate income and increase spending taking advantage of the suspension of European (and Spanish) tax rules.

The statistical service’s response to Herrero is unconvincing. The INE affirms that it is “Today, a greater reduction in terms is impossible” in the delivery of the data from the Quarterly National Accounts and the Non-Financial Accounts of the Institutional Sectors.

The discredit of the institutions does not reach a ceiling in Spain. And that the Government continues to maintain alone that the GDP will grow 6.5% this year and another 7% next year casts doubt on its economic policy.

Brussels said yesterday that our macroeconomic picture is not believed either. His new forecasts are that the Spanish economy will grow 4.6% in 2021 (1.6 points less than calculated in the summer) and 5.5% in 2022 (compared to the 6.3% previously forecast). It puts us at the bottom of the recovery and, which is also very worrying, of credibility in the EU.


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