The Government has communicated to the autonomous communities the amount of the payments on account that they will receive next year from the regional financing system, which reaches 112,213 million euros, 6.3% more than the previous year. “The autonomous communities will receive next year the largest deliveries on account of their history”, has assured the Minister of Finance and Public Function, María Jesús Montero, during the press conference after the Council of Fiscal and Financial Policy that has been held this Wednesday.

During this Council, Montero has also communicated to the autonomous communities the distribution of the additional 13,486 million euros that were included in the General State Budgets for 2021. The money will be distributed according to the adjusted population criterion, the option chosen by the majority of autonomous communities, and most of the disbursement will be made in September (70%) and the rest (30%) in November, as detailed by the minister.

As Montero explained, during the meeting some autonomous communities, such as the Valencian Community, Andalusia or the Region of Murcia, have asked that part of those more than 13,000 million (about 2,200 million) be allocated to a separate fund for ‘under-financed’ communities , but most of the rest of the councilors “did not want to vote on this proposal.”

The minister has also advanced to the autonomous communities that next Monday, August 2, the Sector Conference on European funds will be held. Montero explained that this meeting is “more technical than political” and will not replace the Conference of Presidents, which will also address the issue this Friday.

Montero calls for a fiscal consolidation strategy

Montero has asked the communities to carry out a strategy of fiscal consolidation in the medium term, as far as possible, even if the fiscal rules are suspended, so that once the crisis is over, the deficit level is reduced. As in 2020 and 2021, the European Commission has proposed that the rules limiting the public deficit and debt of the Member States remain suspended in 2022 and reactivate in 2023, once the European economies have recovered their level of GDP prior to the crisis caused by the coronavirus pandemic.

Despite the suspension of fiscal rules, the Government ensures that, as conditions permit, budgetary policy, which will continue to be expansionary next year, will be reoriented towards “more prudent” fiscal positions that reaffirm the sustainability of the fiscal policies. medium-term public finances. For this reason, for 2022 it contemplates “one of the largest decreases in the public deficit”, from 8.4% in 2021 to 5% in 2022.

By subsector, the central administration will continue to assume most of the public deficit and will account for 6.3% of the total this year and 3.9% next, while the deficit reference rate for the autonomous communities stands at 0 7% this year and 0.6% in 2022, and for city councils it will be balanced in both years. In the case of Social Security, the deficit reference rate will be 1.5% this year and 0.5% the next.

The suspension of fiscal rules, which must be approved by the Government with the approval of the European Commission, is covered by articles 135.4 of the Constitution and 11.3 of the Budget Stability Law.

Montero has anticipated that he will ask the Congress of Deputies to re-certify, as it did in October last year, that it appreciates the existence of an exceptional situation that justifies the need to suspend these deficit and debt rules and thus legitimizes the decision of the Government, as required by the Constitution and the Budgetary Stability Law.

The Government will give 3,000 euros as a refund of the VAT settlement of 2017

The Minister of Finance and Public Function, María Jesús Montero, has transferred to the Autonomous Communities in the Council for Fiscal and Financial Policy (CPFF) that the Government will transfer them around 3,000 million euros as a refund of the VAT settlement of the year 2017, as reported by sources familiar with the meeting.

Last May, the Supreme Court issued two judgments in which it obliged the State to return to the Junta de Castilla y León and the Xunta de Galicia a part of the VAT settlement. Now, Montero has announced that he will approve a budget item in 2022 to solve this economic damage.

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