The waiting game

Spain has already received almost 40 billion euros of European Next Generation funds, but what exactly is Pedro Sánchez's government spending it on?

Mark Nayler

Friday, 28 April 2023, 19:01

Back in February, an EU delegation visited the Spanish capital to try and find out what exactly Pedro Sánchez's government is spending its share of Brussels' Next Generation funds on. Despite being "very worried" at the lack of transparency in this respect, the head of the delegation, German Conservative Monika Hohlmeier, no doubt hoped that a few meetings with senior government members, including economy minister Nadia Calviño, would answer her questions.

But now, with Hohlmeier's report about to be published, the situation is no clearer than it was a couple of months ago: "We are still waiting," she said outside a debate in the EU parliament on Tuesday.

Eva Poptcheva, a Ciudadanos member of the European Parliament, is also finding it tricky to ascertain where the Next Gen funds are going. Speaking outside the debate, she said that "Calviño did not really tell us how much money has flowed into the economy... We have had access to independent reports that speak of lower figures than those given by the government."

Poptcheva was a member of the visiting EU delegation in February, when she announced in a radio interview that Spain's Next Gen funds "are not reaching the real economy". Concerns about this money not landing with intended recipients, whether in the public or private sectors, have also been expressed by the IMF.

The EU Commission, though, doesn't seem to be encountering opacity or sluggishness in the Spanish government. At the end of March, it released another six billion euros of Next Gen funds (taking the total already received by Spain to almost 40 billion, over half of its total allocation), satisfied that the Socialist-led coalition had hit 23 milestones, pre-agreed with Brussels as conditions of receiving further installments.

There's no suggestion that the Commission will freeze the remaining payments to Sánchez because of the lack of data noted by the EU Parliament - nor to any other beneficiary of the Next Gen programme, even though Hohlmeier said during her visit to Madrid that Spain was not the only European country that had failed to provide satisfactory accounting data.

The most likely reason for the delay in providing this information is that it doesn't exist, although the Spanish government did say last October that a new audit system - a condition of receiving the third tranche this March - was finally up and running.

None of this is stopping the coalition planning more projects with the aid of the EU funds, chief amongst them the cut-price housing scheme I wrote about last week; but if the money it's already received hasn't been reaching local administrations and businesses as promised, there might be a backlash against the Socialists in the municipal elections on May 28th.

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