Regional Governments Agree to Save 2 bln Euros

The Spanish Government in Madrid has arrived at an agreement with the regional governments to reduce spending by 2 Billion Euros, with 11 of the regions having to clear their debts from 2009. The statement was made after the meeting of the Council for Fiscal and Financial Policy (CPFF) on Monday.

According to the Ministry of Economy, the regional governments currently have a public deficit of over 11%, way in excess of EU targets to be achieved by 2013 - which is 3%.

The P.P. Governed regions abstained from voting rather than support the proposed austerity deal.

The regional governments are now required to meet the same economic requirements as the central government in Madrid, with a target date set for 2013. The state government intends to reduce public spending by some 50 billion in 2013, with 20% of that having to come from the regions.

One of the major savings is expected to be made from personnel costs and ‘a rationalisation of human resources’, with less people being taken on in administration roles over the coming years.

Part of the agreement reached at Monday’s meeting, means that each region has been given a three month period to draw up its own plan for making these savings.