The future of Spain: five parties, two models

On April 28, Spaniards will go to the polls in a snap national election triggered by a deadlock over the 2019 budget. Whichever government emerges from the vote will have to deal with this and other longstanding economic issues such as persistently high unemployment, ballooning debt and how to finance the pensions system with an ageing population. And on the political front, immigration and the Catalan crisis will continue to shape the national agenda.

Spain in a snapshot

Spain has a population of 47 million, 19 million workers, and 3.6 million people out of a job ¨C two million less than five years ago. There are 10 million people living under the poverty threshold.

It also has the world¡¯s third-highest life expectancy after Japan and Switzerland. The state pays 9.7 million pensions a year, and collects less than what it takes to cover that expense. In fact, the state has been collecting less than what it spends for years, and the debt has ballooned to over a trillion euros, leading to financial costs that keep eroding the budget. Tax collection, in the meantime, has returned to 2009 levels.

Last year, 60,000 irregular immigrants reached Spanish shores, more than twice the 2017 figure. There are five million foreign nationals registered on local rolls, 700,000 fewer than a decade ago.

Two models

There are two main political models in Spain. And in a scenario of fragmentation where no one party is expected to win a large enough majority to govern on its own, the five main parties representing these models ¨C Socialist Party (PSOE), Popular Party (PP), Podemos, Ciudadanos (Citizens) and Vox ¨C will have to forge alliances to form a government. These are their proposals for some of the country¡¯s main problems:

Catalonia. The future of the northeastern region hinges on the outcome of April 28. Three right-of-center parties ¨C PP, Ciudadanos and Vox ¨C are promising to reintroduce direct rule by Madrid, which was in force for seven months after separatist leaders made a unilateral independence declaration in October 2017.

Santiago Abascal, leader of the far-right Vox, wants to recentralize Spain again, eliminating the system of devolved powers to the regions

Although it is highly doubtful that Article 155 of the Constitution could be legally invoked once more, all three parties are promising changes in Catalonia, with some nuances. The main conservative PP is promising to ¡°apply as many measures as necessary for as long as is unavoidable¡± on subjects ranging from education to the regional media outlets.

Albert Rivera, head of the center-right Ciudadanos, says he will ask the Catalan premier Quim Torra whether he respects the Spanish Constitution, and if the answer is negative, he will seek temporary direct rule. And Santiago Abascal, leader of the far-right Vox, wants to go a step further and simply recentralize Spain again, eliminating the system of devolved powers to the regions.

On the center-left, the PSOE did not mention Catalonia at the presentation of its ¡°120 commitments¡± for Spain, but Prime Minister Pedro S¨¢nchez has said his party defends territorial integrity and compliance with the Constitution, while rejecting a referendum on self-determination for the region. Instead, the Socialists support improved self-rule for Catalonia.

The leftist coalition Unidas Podemos has stated that it supports ¡°a negotiated referendum in which Podemos will defend a new fit for Catalonia within Spain.¡±

Gender issues. Despite calls by Vox to repeal gender violence legislation, this is not likely to happen. Both of its probable allies, PP and Ciudadanos, defend the law and even want to take it further by addressing the persisting issue of the salary gap between men and women.

The PSOE and Podemos will seek additional legislation to defend the rights of LGTBI groups

The PSOE and Podemos will seek additional legislation to defend the rights of LGTBI groups, and the latter has established a four-year goal to achieve gender parity in public institutions such as the Cabinet or the Supreme Court. The PSOE and Podemos also want to reform criminal legislation following a high-profile sexual assault case known as La Manada.

Taxes. The highest earners, large companies and banks will pay more taxes if there is a leftist government. The PSOE has yet to detail its tax reform proposals, but it has announced new taxes on financial transactions and digital services, as well as a higher income tax rate for the wealthy.

The PP, on the other hand, has pledged to lower the highest tax rate from 45% to 40%, bring corporate tax below 20%, and eliminate inheritance tax, estate tax and a levy on home purchases known as AJD.

The PP, on the other hand, has pledged to lower the highest tax rate from 45% to 40%

Ciudadanos would slightly reduce the highest tax rate (from 45% to 44%), act against corporate tax deductions and eliminate inheritance tax. Vox has pledged similar moves. These parties claim that the loss in tax revenues would be offset by an increase in economic activity, leading to greater collection on existing taxes.

Pensions. Last year Spain spent over €144 billion on 9.7 million pension checks. In 2010, a legal reform raised the retirement age to 67, and in 2014, a new calculation method was introduced that no longer ensured purchasing power for pensioners. The measures aimed to help reduce the system¡¯s deficit, but they failed. Despite a considerable increase in jobs over the last four years, contributions to social security have not made up for a gap that grows by around €18 billion each year. And a surplus of €60 billion has been used up.

Parties are aware of this problem but don¡¯t have any clear solutions. For now, all they are offering are vague pledges that include the words ¡°reform¡± and ¡°sustainability.¡± Unidas Podemos does suggest one specific measure: making the highest earners pay more into the system.

Employment. There are two fundamentally opposed views. The right supports measures that reduce workers¡¯ rights and make firing cheaper (the PP proposes ¡°going further with the progress on market flexibility achieved in 2012¡±). The left wants to repeal parts of that reform to reinforce workers¡¯ rights.

Nearly all parties are offering better conditions for self-employed workers through tax breaks and subsidies for business creation. And they agree on the need for more open-ended contracts. Additionally, most political leaders agree on the need to equate the maternity and paternity leave.

Immigration. There was a 130% rise in irregular migrant arrivals last year, representing nearly 60,000 people. There are five million foreign nationals registered on the local rolls (the padr¨®n), a 700,000 drop from a decade ago. The economic crisis reduced the migratory pressure on Spain, but the recovery has seen a new spike in arrivals.

The PP supports fighting smugglers, reinforcing security measures at the southern borders, and expanding international treaties for repatriation of irregular migrants. Venezuelans are the exception, as they will be granted residency permits.

The PP supports fighting smugglers and reinforcing security measures at the southern borders

The PSOE defends ¡°facilitating orderly migration flows while showing maximum respect for human rights,¡± while Podemos wants to shut down migrant holding centers (CIE), issue ¡°humanitarian visas¡± and to relax family reunification procedures.

At the opposite end of the spectrum, Vox wants to ¡°deport illegal immigrants¡± as well as ¡°legal immigrants who have committed a serious crime or reoffended on minor crimes.¡± This party also wants to build ¡°an insurmountable wall¡± in the Spanish exclave cities of Ceuta and Melilla, on the northern coast of Africa.

Depopulation. The political fragmentation means that the nearly 100 seats being contested in 19 highly depopulated provinces will be key to forming governing majorities. This is why parties are embracing rural Spain like never before, promising more and better services in health care, tax incentives, high-speed internet access, police, tourism plans and more.

Clean energy. All parties, with varying degrees of enthusiasm, support a transition to cleaner energy systems and a reduction of CO₂ emissions. The PSOE wants 74% of electricity consumption in 2030 to come from renewable sources, and a shutdown of nuclear power plants between 2025 and 2035. Podemos wants 100% renewable energy by 2040, and to eliminate nuclear power by 2024. Vox is promising a plan to make Spain ¡°self-sufficient¡± through ¡°cheap, sustainable, efficient and clean¡± energy. The PP defends an ¡°energy mix¡± that will guarantee supply and reasonable energy prices.

English version by Susana Urra.