Easter Week has offered a theoretical break to gather strength for what is to come, the Andalusian regional elections, the most important of this cycle that began in January with those held in Extremadura. This new date at the polls is the one that interests Madrid the most, but also Barcelona, due to its implications. We are talking about a territory with a population of 8,676,713 people, of whom 6,812,861 have the right to vote. It is not just because of the demographic weight of this community that there is a lot at stake in these elections. The full cycle has been and continues to be a testing ground with the prospect of the next general elections, and today it has been settled without a definitive diagnosis. The PP continues to fuel the idea that its arrival at Moncloa is very close, even if it is with Vox as an uncomfortable and essential travel companion. To confirm this, it needs to repeat its current absolute majority in the Andalusian Parliament. Anything less than that will lead to questioning the Popular Party's chances of achieving its main objective. For the leader of the PP, Alberto Núñez Feijóo, this match is decisive. The president of the Junta, Juan Manuel Moreno Bonilla, therefore, has a high responsibility in this electoral call, from which his party may emerge with its chest puffed out or with the obligation to ask many questions about the causes of the slowdown in its expectations.

Carlos Cuerpo and Arcadi España have moved up a rung in the Spanish government after the departure of María Jesús Montero. The hitherto number two in the Spanish executive, however, not only hands over the first vice-presidency and the Ministry of Finance, but also the negotiating power with the so-called Catalan file. Specifically, Arcadi España will be the one to tackle the hot potato of materializing the new financing and reopening talks with Esquerra after the transfer of the IRPF derailed. España was one of the strong men of Ximo Puig's Valencian government and those who know him define him as a convinced federalist and Valencianist, as well as being a firm defender of new regional financing. In fact, he endorses the reform that Montero agreed with ERC. And what do PSC and ERC think of the new minister? The Republicans view him favorably for giving a new "opportunity" to negotiations.In Palau they also look hopefully at the new minister, whom a voice from the Catalan socialists describes as "receptive" to the demands of Catalonia, many of them coinciding with those of the Valencian Country."Arcadi is social democracy made politician, dialogue made ruler, common sense made person," wrote former Valencian president Ximo Puig in a message on X after his appointment was made public. In statements to el ARA, he reaffirms: "He is a person with an open disposition, without closed dogmatisms, with the capacity to listen and empathy." España was Puig's chief of staff during his time in Madrid, also when he was general secretary of the PSPV and when he presided over the Generalitat Valenciana, and subsequently served as minister of Territorial Policy and also of Finance. "Federalism is part of his political culture," defends Puig, who recalls that he is one of the people who has most defended new regional financing within the PSOE. In fact, this is one of the issues that Esquerra values.

Pedro Sánchez on Thursday bid farewell to his closest and most loyal collaborator since he arrived at Moncloa in June 2018. Since then, María Jesús Montero has continuously held the Finance portfolio, one of the most sensitive in any government, and from there she has climbed positions to become, in December 2023, the first vice-president, i.e., number two in the executive. Undoubtedly, Sánchez is giving up one of the pillars of his government to send her to compete in Andalusia against Juanma Moreno Bonilla, a mission that currently seems impossible. It is true, however, that in politics, this month and a half remaining until the elections is an eternity.

If you've been following the story of how the Government withdrew the budget proposal it had submitted to Parliament at the last minute, it won't surprise you that today we begin by emphasizing that The elections in Andalusia now have a date: May 17th.

One of the first consequences of the calling of elections in Andalusia The biggest news has been the departure of María Jesús Montero from the Spanish government. The Vice President and Minister of Finance will have to pack her bags to become the PSOE candidate in the elections, which were announced early this Monday by President Juanma Moreno Bonilla. In her first press conference since the announcement, Montero confirmed this Tuesday that she is beginning "this electoral race" as a candidate and that her departure as minister "will be imminent in the coming days," as she stated on Monday.

Any news we discuss here must be understood within the context of a war that increasingly affects us. War first in Ukraine, and now in Iran and Lebanon. The price of oil has climbed again, and we know that when gasoline goes up, everything else goes up. Our economy currently depends on two politicians, Netanyahu in Israel and Trump in the United States, who don't care about any of this because war gives them free rein to do whatever they want. For example, Israel has attacked the world's largest gas fieldSo this war, which the United States has called "Epic Fury," is bringing us epic inflation and epic disaster, like everything Trump's inept finger touches, especially when he lets himself be swayed by the Israeli lobby and trusts his intuition more than his generals. It's becoming clearer every day that the United States won't bring down the ayatollahs' regime with bombings and targeted assassinations.

I am surprised that Miquel Puig, with whom I have shared analyses and diagnoses so many times, opposes arguments which he himself has strongly defended.

The PSOE-ERC-PSC agreement for a supposed new financing model is a prime example of the current political reality in Catalonia. Or, to put it more accurately: of the current state of affairs. Firstly, because in our country, both from the mainstream media and from those who always prioritize stability—even above their own economic interests—the agreement has been presented as a fait accompli, when in reality it is nothing more than a highly improbable possibility. In other words, ERC and PSOE have counted their chickens before they hatched, counting on anyone who denounces them paying a high price.

The day after crashing into the wall of the PP over the financing reform and while José Manuel Albares He was talking about Venezuela in CongressMaría Jesús Montero has had to appear in the Senate – forced by the absolute majority of the Popular Party – to give explanations about the SEPI caseAn investigation by the National Court into the awarding of public contracts. The First Vice President of the Spanish government defended "the honor, responsibility, and prestige" of SEPI, a state-owned company attached to the Ministry of Finance that acts as the State investment armMontero defended the procedures as "correct." Constantly invoking the secrecy of the investigation, she emphasized that, "for now," it cannot be stated that "any irregularities have been committed" or that "any file has been discovered that was processed in a manner different from the law," and she emphatically endorsed SEPI's actions: "There's no bad apple." The PP wanted to start the year by targeting the alleged corruption cases surrounding—and implicating—the Spanish government, but—less than two kilometers away—Moncloa Palace opted to focus on Pedro Sánchez's international policy with the Foreign Minister's appearance before the lower house. The one in the eye of the storm is Vicente Fernández Guerrero, who was president of SEPI during Pedro Sánchez's first year in Moncloa and was arrested a month ago, along with Leire Díez—known as plumber of the PSOE—and Antxon Alonso—owner of Servinabar, under investigation in the Cerdán case. María Jesús Montero stated that the Civil Guard is investigating the period between 2021 and 2023, two years before Vicente Fernández presided over SEPI: he resigned after being summoned as a suspect in the Aznalcóllar mine case, from which he was ultimately acquitted. "It was not during this period that these individuals held political responsibilities in any of the institutions of this government," she emphasized. She defended herself by posing two questions: "Can you tell me what kind of responsibility I could possibly have in this matter? What is the point of holding a hearing on a subject about which we have no information?" "It disgusts us that there are people who might use politics to enrich themselves financially, but we must be able to clearly define who should answer to the justice system and not tarnish the institutions," the Minister of Finance also requested. Having said that, María Jesús Montero demanded that the PP stop "throwing insidious lies" about the "commendable work" done by SEPI employees. Next, it was the turn of the Minister for Ecological Transition, Sara Aagesen, who distanced herself from any "shadow of suspicion" and assured that "never" has "been" benefited "any company or individual" and that she has always acted with "maximum transparency." Her department is linked to the hydrocarbons case being investigated by the National Court. In fact, the former chief of staff of her predecessor, Teresa Ribera, will have to testify as a witness in two weeks. "Either a participant, an accomplice, or negligent"

The PP has taken the opportunity to attack María Jesús Montero and to make a totum revolutumIn her remarks, she included references to Plus Ultra, José Luis Rodríguez Zapatero, and Paco Salazar. "Pedro Sánchez surrounded himself with people useful for committing crimes and looting, a government prepared to steal," declared the leader of the People's Party in the Senate, Alicia García. She dubbed Montero the "vice president of bribes" and the "minister of the SEPI black hole," reproaching her for presenting herself as a "mere spectator" of what was happening at SEPI: "She is either a participant, an accomplice, or negligent. Or all three." "Spain cannot afford a state captured by its corruption," she concluded.

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The spectacle of Wednesday's Fiscal and Financial Policy Council meeting, where Vice President and Finance Minister María Jesús Montero presented the proposed new financing system to her regional counterparts, can only be described as lamentable. Never before has a Spanish government put so much money on the table to transfer to the Autonomous Communities. And yet, the PP-governed regions have rushed to reject the system with the sole argument that it was agreed upon with Catalonia, and specifically with ERC. Anti-Catalan sentiment remains such a significant driver of the conservative vote that the PP is willing to go so far as to renounce a substantial amount of money simply because it considers it "tainted" by separatism, thereby harming its own citizens.

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Today, the financing model presented by Vice President Montero, which stems from an agreement with the Republican Left of Catalonia (ERC), will be approved by the Council for Fiscal and Financial Policy (comprised of the Minister of Finance and the regional ministers of Economy). However, its approval does not mean it will be implemented immediately, as it will now have to be negotiated in Congress with all parties, and, as you know, the proposal currently lacks the necessary votes. The People's Party (PP) and Vox are fundamentally opposed to the system, while Together for Catalonia (Junts) believes it falls short.

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What has become of the "solidarity economic agreement," the title given by the ERC leadership—at that time headed by Marta Rovira—to the financing agreement that would ultimately lead to Salvador Illa's downfall? The President of the Generalitat never embraced the concept of an "agreement," nor did the Spanish government. What was put in writing in July 2024 stipulated that Catalonia would collect all taxes, cede a percentage to the State, and establish a solidarity quota. A year and a half later, the agreement between the Spanish government and Esquerra—in which The State will allocate almost 4.7 billion euros to Catalonia– differs substantially from what Isla brought to the Palau de la Generalitat.

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Here are 10 concrete points to consider regarding funding:

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More resources and greater participation of the autonomous communities in key taxes such as personal income tax (IRPF) and VAT are two of the main pillars of the proposed financing model for the autonomous communities under the common regime (which includes all communities except the Basque Country and Navarre, the chartered communities), presented this Friday by the First Vice President and Minister of Finance, María Jesús Montero. The proposal involves updating the current system and comes after an agreement with ERCAnd, incidentally, with the Generalitat – in exchange for supporting Salvador Illa as president, an agreement was reached with the Republicans to implement a new model that would take into account Catalonia's "uniqueness." The proposal aims to move beyond the current model, designed in 2009 and awaiting updating since 2014. Montero acknowledged that this is one of the "most complex" challenges of the legislature and immediately urged against falling into the trap of "territorial favoritism." The Treasury has clearly always worked to ensure that, despite the negotiations with ERC, where they are satisfied with the outcome, the proposal is not interpreted as a model tailor-made for Catalonia. "There is no single model for every autonomous community," the Finance Minister asserted.

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After more than a year of negotiations between ERC and the PSOE (with the PSC caught in the middle), the moment of truth is approaching regarding Catalonia's special funding arrangements. This January, the Minister of Finance, María Jesús Montero, is scheduled to publish her proposed distribution of funds, an exercise that hasn't been undertaken in Spain since the last funding system was approved in 2009. The issue of personal income tax revenue will be addressed later, given that the current Catalan tax system is already underfunded. However, Montero must present figures, and the one of greatest interest in Catalonia is how much additional money the Generalitat (Catalan government) will receive to finance its responsibilities. But it will also be necessary to see how the other regions fare, especially the Community of Madrid, which benefits from the capital city effect and engages in highly unfair tax dumping compared to the rest of the country, as well as Andalusia, the most populous autonomous community.

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María Jesús Montero, First Vice President and Minister of Finance, plans to make a all in The first quarter of 2026. Pedro Sánchez's second-in-command has been grappling with three issues for some time: the cancellation of regional debt, the special financing model, and finally, the national budget. If her calculations are correct, all three will be on the table between February and March. This would mean that these three thorny issues would coincide. Despite the high level of political—and media—expectation, she is not worried. "It has to be done," sources at the Ministry of Finance summarize.

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María Jesús Montero has set a date for the presentation of the new financing system, but has not yet detailed what the new model will entail. However, this has not prevented the president of the Madrid region, Isabel Díaz Ayuso, from launching a scathing attack against the Spanish government, which she has accused of "dismantling the fiscal autonomy" of the autonomous communities. Ayuso made this statement in response to Montero's explanation on Monday that the new model aims to take into account the "fiscal responsibility" of the regions. as explained by the ARAIn other words, she wants to "discourage tax dumping" by Madrid. For the president of the Madrid region, this would "stifle" the Community of Madrid as the "engine of the Spanish economy."

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We have an important figure regarding financing, which hasn't been published anywhere, that we'll discuss shortly. But first, President Pujol continues to recover well from the pneumonia for which he was hospitalized and could be discharged relatively soon. This would allow him to appear remotely before the judge of the National Court next Monday, with Pujol in Barcelona and the judge in Madrid. This appearance is clearly designed to target Pujol, because it will allow the judge to decide whether the former president is fit to testify at his trial or not, when it turns out that forensic doctors have prepared a report for the judge confirming what we already told you yesterday in our analysis: that Pujol is not fit to testify or defend himself. And so, the question is: if the doctors appointed by the court to evaluate Pujol's condition... You've already been told that he's not in a condition to testify.Why are you summoning him to appear? Should a judge medically evaluate a person? It's just wishful thinking.

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Negotiations between the Spanish government, the Catalan government (Generalitat), and the Republican Left of Catalonia (ERC) regarding a new financing model for Catalonia have been ongoing for weeks. If an agreement is reached, the Minister of Finance, María Jesús Montero, who is also the Socialist Party (PSOE) candidate for the regional elections in Andalusia, will have to explain it publicly. However, the person behind the scenes, negotiating on a daily basis for the Spanish state, is not Montero herself, but her right-hand man: the Secretary of State for Finance, Jesús Gascón Catalán. He is the one who has the details of all the financing models on the table; he is the one who understands the numbers and the... excellent and sits down face-to-face with the negotiators from the PSC and Esquerra.

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One of the consensuses between the Spanish government, the Catalan government, and Esquerra is that the Community of Madrid must be limited in funding. Experts consulted assure that the "capital effect" enjoyed by Isabel Díaz Ayuso's government is one of the main "distortions" of the current funding model, since this gives it many more resources already. de facto compared to the rest of the territories. Added to this is the fact that Ayuso pursues an aggressive tax-cutting policy that acts as an economic magnet to the detriment of other communities (especially those surrounding it), with the reduction of its own and ceded taxes. The president of the Generalitat, Salvador Illa, himself said in an interview in the ARA In August: "We must put a stop to unfair competition and tax dumping in Madrid."

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