Last day of campaigning


Today is the last day of campaigning in the Spanish general election with the opposition People’s Party (PP) expected to win an outright majority on Sunday.

Tomorrow there is no campaigning which is designated as a day of reflection before the polls on Sunday.

Mariano Rajoy, the leader of the PP, has been especially careful not to upset the balance of the final week of campaigning. He has held no press conferences and turned down numerous requests for interviews, preferring instead to rely on street campaigning and large public rallies.

He did undertake an interview with the newspaper El Pais yesterday in which he said that his government would honour the commitment to cut the budget deficit to 4% – this year’s target of 6% is unlikely to be met.

In a move that has left the markets nervous and saw 10 year bond yields rise dangerously close to the magical 7% figure yesterday, Rajoy refused to say who would make up his economic team or who would be the Finance Minister; although he did say that he had decided upon his team.

In the interview he made it clear that he would maintain the purchasing power of pensions, but everything else was up for cuts. There would be a review of all budget items with fewer public works along with a completion of what is currently under way. He pledged to remove many autonomous bodies, to combat tax evasion and to tackle fraudulent unemployment benefit claims. Although he said that he had no plans for cuts in the public service beyond those already announced, but that there would likely be a freeze on further recruitment.

Mariano Rajoy said that there would be no raising of taxes but that he did want to create a business friendly environment by passing the stability law agreed in the summer and by boosting growth through labour reform and restructuring of the financial system.

If the PP win on Monday it will be their first time in government since 2004.

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