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Wednesday, Jan 22, 2025

Spanish Government Seeks Junts' Support to Uphold Pension Increase Amid Legislative Challenges

Spanish Government Seeks Junts' Support to Uphold Pension Increase Amid Legislative Challenges

Tension mounts as the PSOE negotiates with Junts to secure crucial votes for economic reforms including a pension increase.
The Spanish government is engaged in critical negotiations with Junts per Catalunya (Junts) as it seeks to pass an omnibus decree that includes a revaluation of pensions indexed to the Consumer Price Index (CPI), among other measures.

The decree, which aims to mitigate the economic impacts of the ongoing crisis, will be voted on in an extraordinary session of the lower house of Parliament.

Both the Spanish Socialist Workers' Party (PSOE) and Junts have reportedly held discussions to smooth the passage of this decree.

Despite the abrupt suspension of sectorial negotiations announced by Junts' leader Carles Puigdemont, talks concerning this specific legislative matter occurred via videoconference between PSOE’s organizational secretary Santos Cerdán and Puigdemont.

However, Junts has kept its voting intentions undisclosed until the last moment.

The omnibus decree, approved by the Spanish Council of Ministers, encompasses a range of economic and social provisions including the revaluation of pensions effective from the beginning of the year, a move affecting approximately 12 million pensioners.

If the decree fails to pass, pension increases could see a rollback, affecting older citizens' incomes.

Moreover, the decree includes public transport subsidies and fiscal benefits for energy-related expenses and the purchase of electric vehicles, as well as measures to prevent utility disconnections for vulnerable consumers.

Minister of the Presidency, Justice, and Relations with the Courts, Félix Bolaños, emphasized the importance of passing the decree, citing the direct impact on citizens such as sustaining pension increases and transport benefits.

Despite ongoing negotiations, there remains uncertainty over whether Junts will support the government in this legislative effort.

The government is also holding parallel discussions with other political groups, including the People's Party (PP), hoping to garner broader support or alternative backing should Junts' contributions falter.

In addition to the omnibus decree, the session will vote on two other legislative matters—a regulation concerning the compatibility of pensions with employment, and an extension of a tax on large energy companies.

Junts and the Basque Nationalist Party (PNV) have expressed opposition to the energy tax extension due to potential impacts on investments in Catalonia and regional fiscal arrangements.

The outcome of these votes holds significant implications for the Spanish government.

A failure to pass critical economic measures risks not just economic repercussions but also political stability as it negotiates its standing with various parliamentary factions.
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