The State lends an extra €500,000 million over 14 years to the communities: the figures of underfunding
The amount received by Catalonia through the FLA and other extraordinary instruments exceeds 170,000 million, but the community that receives the most per inhabitant is the Valencian Country
BarcelonaMore than 32 out of every 100 euros that the State lends to the autonomous communities to pay pending bills, through extraordinary financing instruments such as the regional liquidity fund (FLA) since 2012, are received by Catalonia. According to the latest data from the Ministry of Finance, the figure currently reaches, after distributing resources up to the third quarter, 170,152.1 million euros out of a total of 526,598.82 million for all autonomous communities. But the ranking changes when the amount is calculated per inhabitant. In this case, it is the Valencian Community that is at the forefront, especially after the resources to mitigate the effects of the storm in the autumn of 2024.
The Catalan government refers to a report from the Court of Auditors that calculates the collective and relative underfunding for Catalonia compared to the income agreed in 2009 in the regional financing system between 2002 and 2022 at 33,570.61 million euros. One of the first solutions for this situation is the forgiveness of part of the FLA agreed between the PSOE and ERC for the investiture of Pedro Sánchez, amounting to approximately 17,104 million euros, the second highest after that of Andalusia (18,791 million euros). It is planned that the measure will be debated in the next extraordinary plenary session of Congress on July 23 to vote on the amendments in their entirety presented by the PP and Vox, and it is believed that Junts will foreseeably not vote for them. Therefore, it can be processed and the final vote can be carried out probably in September.
The other tool is the new regional financing. On the 29th, the meeting of the Council of Fiscal and Financial Policy (CPFF) will take place. Apart from the Spanish government, the measure only has the support of Catalonia, because Asturias, governed by the socialists, also disagrees. In this context, the approval of the model, sent to the autonomous communities on Friday by the Council of Ministers, does not yet have a date to be sent to Congress, where it could foreseeably pass the first stage, without certainty of being able to push it forward in the final vote due to the strong opposition. With the new model, Catalonia would earn almost 4,700 million more.
In any case, the amounts received from the FLA and other instruments to alleviate the autonomous financial shortfall are loans, not amounts granted as a loss. In fact, the Generalitat has started this year for the first time in 14 years to issue debt with banks, taking advantage of the fact that interest rates can be lower than those charged by the State. The 8,989 million corresponding to the FLA for 2025 had an interest rate of 3.028%, while the 4,636 million planned for this year are around 3.25%, according to the information the Government provides to investors. The big jump in cost occurred in 2023, when the rate stood at 3.497%, compared to 1.517% in the previous year. This is what drove the Generalitat last year, which refinanced 3,500 million of FLA debt from 2023 through private banking for the first time in thirteen years. CaixaBank, Banc Sabadell, BBVA, and Santander were some of the banks that allowed the Government to complete this refinancing, with which the Catalan administration will save 127.6 million in interest over eleven years, until 2035, according to the calculations of the Ministry of Economy.
And taking advantage again of the evolution of interest rates, even though they have recently turned upwards again, the Government has gone a step further and in April decided to place 292.75 million with the bank through credits, which have been obtained at a "very advantageous" average interest rate of 2.331%, below the cost through the extraordinary liquidity instruments provided by the State.
These modalities, created to alleviate the impossibility of the autonomies to access the markets when the debt crisis broke out in 2012, first with the PP government and then with the PSOE government, have made the State the main financier and creditor of the most indebted autonomies. This is the case of the Generalitat, with a liability of more than 90,000 million, of which around 85 out of every 100 euros have the State as creditor. According to the latest census, each Catalan carries a debt of 10,999.75 euros, which contrasts with the 5,641.32 of the Madrilenians, practically half, or the 11,595.20 euros of the Valencians.
The Catalan administration anticipates it will depend on the State until 2036. In presentations to investors, it states that debts up to 2016 corresponding to State instruments have already been settled to facilitate liquidity. Now, those from 2017 onwards remain pending. The interest rates on liquidity instruments were very low, hitting a low in 2021 with an average of 0.109%. Currently, they exceed 3%, which is why the Government has been seeking offers from private banks. The Generalitat government aspires to be able to access the markets in the future, something it has not done since 2012, although it has not yet set a date.