The budget: Sánchez's thorn in his side for three years.

MadridWith no general state budget in 2024, or even in 2025, everyone is already looking ahead to 2026. The Spanish government is maintaining the 2023 public accounts, Pedro Sánchez's last, approved on December 20, 2022, postponed. The Spanish government intended to approve them. In fact, if the usual procedure is taken into account, Pedro Sánchez is even late in the process of preparing public accounts for 2026. In this scenario, The outbreak of the Santos Cerdán case has not helped at all., which has created a new rift in the always weak relationship between the Spanish government and its investiture partners, adding to the parliamentary instability that has engulfed the current legislature since the beginning. In fact, the leader of the ERC (Republic of Catalonia), Oriol Junqueras, has just warned that there will be no budget in Catalonia, but neither in Spain. If the agreement for singular financing is not resolved well and, in particular, the collection of personal income tax.

We return to the schedule for a state budget. Initially, there is no reason to believe that a Fiscal and Financial Policy Council will be convened this summer, although some autonomous communities, such as Extremadura, have requested it. This is a matter of debt for the regional governments so that they can prepare their own accounts. Before then, the Ministry of Finance should have already published the ministerial order to kick off the preparation of the General State Budget. June.

With the ministerial order from the Treasury on the table, public bodies and ministries begin to write their personal letters to Their Majesties the Three Wise Men. That is, the maximum amount of money that all the public administrations of the State can spend in a year. In 2024, with a view to the 2025 accounts, a record spending ceiling was proposed: €195.353 billion, not including European funds, for the central administration, the autonomous communities, the municipalities, and Social Security. It also establishes a new spending rule. suspended due to the Covid-19 pandemic.

First clash with partners

These stability objectives are precisely what partially derailed the 2025 budget. When they reached the Congress of Deputies, Junts (Junts) overturned them. Carles Puigdemont's party, amid a crisis of distrust with the PSOE (Spanish Socialist Workers' Party) over the failure to comply with some of the investiture agreements, demanded a larger deficit margin for the autonomous communities and less for the central administration. An agreement has never been reached.

Once the autonomous communities and local governments have been informed, the Spanish government prepares the draft budget, which normally reaches the Cabinet between September and October. When the votes of other parties are needed in Congress, as is the case this term, the draft budget usually already includes some of their demands so that it can be approved once it reaches the Spanish lower house. Thus, although negotiations continue once the General State Budget (GSP) reaches Congress, they do not start from scratch.

However, the Moncloa government has long sought to avoid the image of weakness in Parliament, that is, seeing its laws derailed because they lack the bound votes of the investiture partners. The latest example of this is the decision to postpone the debate on reducing the working week to 37.5 hours until after the summer. The state budget is one of the most important tests, if not the most important, in terms of being able to boast of stability, but also of a government project, if the intention is to complete the term and call elections in 2027. In fact, if he fails to pass the budget in 2026, Sánchez could be forced to terminate his mandate. Therefore, the executive will have to carefully consider when, and also how, to bring the General State Budget to the Congress of Deputies at a time when the idea of a vote of no confidence in the Cerdán case has also been floated.

Are there any consequences to not having budgets?

Some downplay the consequences of not having a state budget—one can opt for credit extensions for unforeseen expenses—although this past week, a regulation was passed that clearly shows that the accounts have been postponed: the public employment offer of 36,400 for 2025. In the case of existing ones, the same amount of money is available.

Meanwhile, the Fiscal Authority has just called on the Ministry of Finance to activate the process of preparing the 2026 General State Budget as soon as possible and to precisely detail the impact of the increase in public spending on defense, especially if the 2% of GDP commitment to NATO is to be achieved.