Starting from a good economic inheritance, backed by positive GDP growth data, a significant increase in employment, as well as Social Security affiliation, recovery of tourism, as well as consumption. Also starting from healthy public accounts, without structural deficit, a small debt, an excellent credit rating and reasonably stable and predictable income. With that starting situation, the current Government of the Canary Islands had a great opportunity to continue deepening that path when preparing the Community Budgets for 2024. However, its decisions are beginning to squander that inheritance with public accounts that have negative immediate consequences for public services and for the economic sectors, and that, in addition, will generate serious problems in the coming years. For this reason, the parliamentary group of Nueva Canarias-Bloque Canarista (NC-bc) has just presented a total amendment to them in Parliament.
The analysis of these Budgets for 2024, the first of the conservative Government CC-PP, confirms their imprudent, reckless and arbitrary nature. With a growth of 11% in relation to that of 2023 (1,121 million euros more) - despite the recovery of fiscal rules and a slight growth of 2% for next year - based on a falsification of the spending rule generating an overestimation of the degree of budgetary execution of this year 2023; and that, in addition, of that increase consolidate 1,000 million euros in structural spending, failing in both parameters the recommendations in the opposite direction of the Independent Authority of Fiscal Responsibility (Airef). A completely artificial and forced growth in public accounts for 2024 that will end up compromising the autonomous budgets of 2025 and subsequent years given the difficulty of guaranteeing the same level of non-financial income due to the intense fall that will occur both in the resources of the autonomous financing system and in European funds and, also, due to the reduction of the contribution of the road agreement.
Economic recovery and healthy accounts
The Government of Progress (2019-2023), of which NC-bc was part, directing the Ministry of Finance, Budgets and European Affairs, left the Canary Islands as the most healthy common regime community. Without structural deficit, with the lowest per capita debt in Spain -2,800 euros per person per year, when the average is 5,000 euros per person-, stable and reasonably predictable income and having the highest credit rating, which allowed us to go to the markets to get better conditions for the debt.
And, despite the disasters suffered in that period -Covid 19 pandemic, collapse of tourist operators, forest fires, La Palma volcano or war in Ukraine- the economy has been recovering strongly. After a robust growth of 7% and 8.2% in 2021 and 2022, forecasts indicate that the Canary Islands will end this year with more than 4% growth in its GDP, one point above the state average. The second quarter of 2023 closed with 999,400 people employed, according to data from the EPA. Registered unemployment was at 174,000 (in 2008 figures), despite the fact that the population also grew very significantly, Social Security affiliation rose to 880,000 people, a historical record. The tourism sector will end the year with better records than before the pandemic; in 2022 the turnover already exceeded that of 2019 and 2023 will follow the same path. The same trend is observed in consumption and collection.
All the progress experienced can be wasted with a conservative government whose first measures have been to lower taxes for the richest, increase as never before the number of senior officials and advisors of the Executive and fail to comply with its electoral promise to reduce the IGIC from 7% to 5%. Curiously, what they do is carry out some tweaks to the IGIC that, as a whole, involve a tax increase and an increase in revenue collection that is close to 17%. Of course, they copy and maintain the tax relief that the Government of progress launched on the Income Tax of Individuals (IRPF) that they strongly criticized at the time, promising in the campaign to intensify these aids, which they have not done.
A fraud, that of the IGIC reduction, which produces an ambivalent feeling in me. On the one hand, I celebrate that this reduction is not carried out due to its serious consequences on public services and on the financing of the municipalities and councils of the Islands. And, at the same time, I cannot stop thinking about the seriousness of that deception to the electorate with promises that will not be fulfilled, but that have a great propaganda effect, used as a hook to capture votes; damaging, consequently, politics and democratic credibility.
Arbitrary distribution
Another aspect that we highlight from NC-bc is the arbitrary distribution that is made of the budgetary growth. Of the 1,121 million euros, more than half go to Health (576 million), leaving the remaining 544 for education, social welfare, culture or productive sectors. In the first place, different analysts consider it a nonsense that the health budget intends to reflect the real expenditure -consolidating inertial and inefficient expenditure derived from the fight against Covid-, when it is a service in which the needs are very difficult to limit and in which it is essential to improve efficiency in spending and the professionalism of the leaders. It is also poorly justified how this increase is distributed in the Canarian Health Service: investments suffer a reduction of 37% (71 million), while pharmaceutical spending grows by 24% (127 million).
The other great public service, education, rises well below the average of these public accounts. And, instead of approaching compliance with what is established in the Canarian Education Law (LCE) of 2014, there is an enormous and serious setback. In effect, the previous legislature meant an
important advance, approaching the target of 5% of GDP set by the LCE. The budgets for this year 2023 already placed education at 4.63% of GDP. What this right-wing Government does is to go back to 4.20%, four tenths less and eight from 5%. Affecting aspects as relevant as the extension of early childhood education 0-3 years, the essential modernization of FP or the renovation and improvement of the infrastructures of schools.
On the other hand, our public universities receive an unusual and unfair punishment despite the premiere of a Ministry of Universities, Science and Innovation and Culture, increasing the items of our higher centers by only 3.6 million euros, which puts them in a critical economic situation, with difficulties to pay the payrolls. A treatment that extends to the cultural sector, which sees its items reduced by 10 million, just in the opposite line to what is indicated by the law of the Public System of Culture of the Canary Islands approved unanimously by the Parliament in March; a law that requires reaching 2% of the Community Budget in cultural matters in 2030 and, meanwhile, must be each year above the average expenditure, and not only does not rise the slightest, but it goes down.
Social Services and economic sectors
Other budgetary decreases of enormous gravity are those suffered by the Canarian Employment Service, which will have 10 million less than in 2023. Also decreasing transfers in terms of equality and the fight against gender violence, which only happens in those communities in which there are PP-Vox governments. The Law of Social Services is not complied with, which establishes that the budgetary items in this area must grow annually 55 million as a minimum, remaining far behind that figure by increasing only 33 million euros. Also failing to comply with the Pact for Science and Innovation, by not including the amounts committed in this. They also cut in the policies of cooperation to development. Never has a Budget included so many breaches of the Government with laws in force and plans approved by the Parliament. And, with respect to the economic sectors, the primary sector, very affected by the inflationary crisis, sees its budgets reduced by 24 million euros.
The Budget Law is decisive when setting the priorities of a Government, its economic, social and environmental roadmap. And that of this Executive of the two rights neither bets on public services nor on care policies; nor on culture, which suffers a spectacular cut. Likewise, the fight against gender violence, and the economic sectors, especially the primary sector, which surely needs more support, are badly damaged. It is difficult to generate so much discontent in such artificially inflated Budgets. Despite the positive inheritance received in the economy and in the public accounts, the CC-PP Government could not have started worse.
