The Regions Invest Mere 11% of the Amount Foreseen for Property Sales

Each year the history repeats itself. The communities state that they will allot specific amout of money to the property sales but at the end of the year they barely reach the minimum percentage of the amount declared. In 2009, the independent budgets deposited 1.960 millions for the section 6 of the disposal of real estate investments. They managed to reach 9% of the amount. The following year they deposited 1.373 millions and covered 19.9%. There are 2.569 millions predestined for the exercise. It is the biggest amount of money in the history. By September, the collection is reaching only 11.5% of the 295 millions predicted initially. (…)

The problem constitutes the link between public expenditure and the revenues. If the lattest are lower than expected, the deficit arises. This is what precisely occured in all the Administrations at the first days of crisis, when the surplus equal to 20.748 millions in 2007 turned into a deficit of 116.429 millions 24 moths later. (…)

The last time the regions fulfilled their declarations about the deposit for real estate sales was in 1997. (…)

Out of the 2.569 millions that the communities expected to spend on the disposal of real estate investments this year, 34% belongs to Catalonia and another 32% to the Community of Madrid. Althought Catalonia has reached 20.8% by now, it is expected to sell more properties by the end of the year.

At the moment, the only community that easily fulfilled its estimations was Castilla and León. It deposited 20 millions for the disposal of real estate investments and earned 34.6 millions. Interestingly, the Balearic Islands chose not to include the disposal of real estate investments in its annual budget at all and in spite of this made up to 662 millions in sales of the property. The entrance of these unexpected resources explains why this community has not registered deficit at the end of the exercised period.

Overally, the debt of the autonomous communities reached 1% by September and it is gradually approaching the limit of 1.3% at present. (…) What is more, one shall take into account that the President abolished the extra pay for officials in December 2012, which allowed the independent communities to save about 3.300 million Euros. With this precedent, the budget deficit target seems likely to fail.

The President has already sent notifications to Catalonia, Andalusia, Murcia, Autonomous Community of Valencia about the risk of crossing their limits. The Mister of Finance urges these communities to provide  the foreseen adjustments for the next year. (…)

It is surprising to find Madrid in this group, as the region usually performs well. In the first 9 months of the year it accumulated deficit of 1%, which practically covers the annual target fixed in 1.07%. (…).

Source: Cinco Días