Spain sees spending cut by 17% on average
Minister of Finance and Public Administration, Cristobal Montoro, announced his 2012 budget to the Spanish parliament yesterday.
The 2012 budget will see cuts and tax increases amounting to €27.3 billion (£22.5 bn; $36 bn) with average cuts across all the ministries of around 17%.
The civil service will see a freeze on their salaries and longer working hours but pensions were not touched in the budget.
The total package aims to see the deficit cut from 8.5% in 2011 to 5.3% in 2012. This will lead to a 1.7% contraction in growth.
The biggest hit was suffered by the Foreign ministry which saw its budget cut by 54%. The overseas aid budget was cut by 64%. Other departments have also suffered with cuts of 21.9% in education and 22.1% in infrastructure spending. Health has survived relatively intact, taking just a 6.8% cut. Research and development was cut by 25%.
The budget debate will run until 26th April when it should be passed comfortably with the large majority the People’s Party (PP) currently holds in parliament.