In a significant development, the Council of Fiscal and Financial Policy has approved a proposal to cancel eighty-three billion euros of debt owed by Spain’s autonomous communities. This decision was announced by the Minister of Finance, María Jesús Montero, who labelled the approval as historic, marking a first in such a substantial debt relief measure for the regions. Despite representatives of the Popular Party leaving the meeting early, the proposal received backing from several communities, including Castilla-La Mancha, Asturias, and Catalonia.

Montero criticized the Popular Party for their ‘unprecedented disloyalty’ during this process, emphasizing the importance of cooperation among regions in times of financial need. The minister is confident that, despite initial reluctance, these communities will eventually subscribe to the debt relief agreement as it ultimately serves their interests.

This debt cancellation plan is expected to save these communities a minimum of six thousand five hundred million euros in interest payments, potentially rising to seven thousand million, depending on various factors. Although the Popular Party abstained from the voting process, the approval was facilitated by the government’s majority voting power within the council.

Furthermore, the implementation of this debt relief will require the passage of an organic law through both the Congress and the Senate. Minister Montero is optimistic about having this legislation approved before the year ends and is set to engage in bilateral meetings with the autonomous communities to navigate this process effectively.