Brussels cuts European funds in Spain to abuse long-term temporary workers

BrusselsBrussels cuts to the European funds that would have been allocated to Spain. The Moncloa government has managed to unblock the fifth payment of European funds after months of negotiations with the European Commission, but only partially, and it has also lost part of the funding it had initially secured. abusing long-term temporary workers in the public administrationAnd, secondly, it will not pay €460 million of the fifth installment due to the failure to approve the diesel tax increase and €40 million due to the lack of progress in the digitalization of local authorities. Thus, in this fifth installment, Brussels will disburse €22.926 billion in transfers—about €1 billion less than expected—and €15.935 billion in loans.

Regarding temporary workers, the Spanish government had already committed in the first installment of the funds to reform the legislation affecting long-term temporary workers and reduce the temporary employment of public administration workers throughout the country. Based on this commitment, Brussels disbursed €627 million to the Moncloa government. However, two rulings by the Court of Justice of the European Union (CJEU) later concluded that the reform by Pedro Sánchez's administration was not significant enough to reduce the large number of public workers who are held to contracts for years in the administration without obtaining a permanent position. In fact, the European Commission has already opened an infringement process against Spain for that very reason.

In any case, the Minister of Economy, Carlos Cuerpo, has assured the press that he is already discussing with the European Commission the "solution" to end the abuse of long-term temporary workers. In this regard, Treasury sources report that they intend to include the measures Brussels demands for this group in Spanish legislation through the organic law reforming the judicial and prosecutorial careers, which the Moncloa intends to urgently process in Congress, and through an amendment to the civil service law, which they expect to be approved.

Furthermore, the increase in the diesel tax demanded by the European Commission is resisting the Spanish government, and for this reason, the EU executive has not delivered the full amount owed to the State. Furthermore, Madrid received the fifth payment much later than initially expected. The Moncloa (Spanish government) made the request to benefit from this portion of the pandemic recovery funds, dubbed Next Generation, in December of last year. Brussels then set a deadline of March 21st to evaluate all the measures that Pedro Sánchez's government would need to implement in exchange for unblocking the disbursement of the fifth portion of these European subsidies.

Extensions and revisions of the plan

However, faced with the difficulties encountered by the Moncloa in implementing the reforms required by the European Commission, Spain requested several extensions and revisions to the plan for the disbursement of European funds corresponding to the State. Thus, it was not until more than three months after the first scheduled deadline that Spain partially benefited from the fifth payment, although it was initially one of the Member States that received disbursements of post-pandemic funds the fastest.

The money from the fifth payment, like the overall amount of this aid, will be allocated primarily to sustainable projects and to increasing the strategic autonomy of the European Union. Spain, along with Italy, is the European partner that will benefit the most: it is expected to receive around €79 billion in direct aid and just over €83 billion in the form of credit. According to Brussels, they will contribute toincrease Spain's gross domestic product (GDP) by 3.5%At this point, the State has received 70% of the total funding agreed with the European Commission.