Changes

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The regional administrations had to cope under very challenging conditions with the social emergency caused by the pandemic. First, because levels of poverty and social exclusion stood amongst the highest in the European Union. Second, because public spending on social protection and health services stood 4.5 points below the EU average before the pandemic and had not yet caught up the levels observed before the double recession registered back in 2008-2013, when severe cuts were introduced. For example, Amnesty International pointed out that spending on public health fell from 70.7 billion euros in 2009 to 62.8 in 2018 (i.e. -11.21%), whilst the population over 65 years of age clearly increased in this period. Third, because the Spanish model of public services shows sharp differences between regions, as may be observed on the map on the Evolution of total public spending by the regional administrations, and are a consequence of a funding model of the regional administrations that happens to be unable to provide similar services in the different territories. It is therefore urgent to agree on a new funding mechanism for the regional administrations that may tackle social and economic problems that are likely to worsen over the coming years.

The pandemic severely strained the health system, the education system and the social services. However, a great effort was made by all administrations, especially by the departments dealing with social, health and educational issues. The national administration made a significant contribution by implementing furlough schemes to provide basic security for employees affected by lockdowns and company shutdowns. A 16 billion euro COVID-19 fund was also endorsed so that regions could finance the extraordinary expenses caused by the pandemic. This was a non-refundable fund, earmarked for health (9 billion), education (2 billion) and revenue shortfalls (5 billion). Despite the territorial differences, regions increased their budgets in 2021 and prioritised the three main social areas for which they are responsible, i.e. health, education and social services. All this was possible because the new fiscal rules with which the European Union tackled the pandemic were very different from the austerity imposed during the Great Recession from 2008-2013.