On Tuesday, Spain's minority government reached an agreement with the Catalan separatist party Junts to pass various economic measures in parliament, overcoming a deadlock that had cast doubt on its legislative capabilities. The pact is seen as a positive development for the upcoming budget bill yet to be presented by Socialist Prime Minister Pedro Sanchez's administration. Meanwhile, Spain is continuing with its 2023 spending plan, as it did last year.
The deal encompasses increased pensions, financial aid for the Valencia region affected by deadly floods in October, and a six-month extension of public transport subsidies. Sanchez expressed relief that the legislation is expected to receive a strong majority approval, emphasizing the importance of dialogue, negotiation, and consensus in his government's practices.
Junts confirmed the agreement in a statement but noted that all tax-related matters would be subject to further negotiation in the future. Specifically, Junts objected to extending a windfall tax on energy companies, citing adverse effects on investments in affluent Catalonia.
Balancing various interests in parliament, Sanchez's government navigates between concessions to opposing demands from parties like the left-wing Podemos and the right-leaning Junts. Junts' leader Carles Puigdemont had previously raised concerns about a "trust crisis" with the government, indicating that their support hinged on resolving the issue.
In response to pressure from Junts, the Lower Chamber will debate a motion of confidence concerning Sanchez. When asked, Sanchez indicated he saw no necessity for such a motion to be initiated, signaling his confidence in the current parliamentary dynamics.