Valencia leader opens door to financing talks with Spain's government but insists on multilateral forum
After a cordial but inconclusive meeting with Finance Minister Arcadi España, Valencian president Juanfran Pérez Llorca said he would accept a new autonomous financing model only if debated jointly by all regions, while his government will abide by any congressional debt write-off.
A meeting long awaited
The meeting between the Spanish finance minister, the socialist Arcadi España, and the Valencian president, the popular Juanfran Pérez Llorca, took place this Monday at the Palau de la Generalitat in Valencia. Llorca had requested the encounter when España was appointed, and it lasted around an hour. Both described the tone as cordial, a rarity in the current polarised political climate, but the session ended without substantive agreements.
The financing model standoff
Llorca declared that the Valencian Community is open to negotiating a new autonomous financing system, but only within the multilateral framework of the Fiscal and Financial Policy Council (CPFF), not in bilateral meetings with the central government. He rejected the government’s proposal in its current form because, according to his analysis, it would leave the region below the national average. The president insisted that any offer must be backed by a draft organic law and a corresponding allocation in the state budget.
I open myself to negotiating a new financing model. My position is clear, and that negotiation must take place in the Fiscal and Financial Policy Council. Yes to negotiating if they convene the council now.
Liquidity injection and fiscal demands
Arcadi España informed Llorca that the Government Delegate Commission for Economic Affairs (CDGAE) would approve €4,033 million in liquidity for the Valencian Community that same afternoon. The package consists of €1,904 million from the extraordinary FLA (ExtraFLA) and €2,126 million from the ordinary FLA for the third quarter. The minister’s message was that the region would not face treasury tensions, in contrast to what occurred under his predecessor. Llorca also presented a list of claims totalling about five billion euros, covering infrastructure, pending investments and legislative changes to speed up post-dana reconstruction work.
- ExtraFLA (approved)
- 1904 millions of euros
- FLA ordinario 3Q (approved)
- 2126 millions of euros
- New model additional (proposed)
- 3669 millions of euros
- Debt forgiveness (estimated)
- 11000 millions of euros
Debt forgiveness accepted reluctantly
On the question of cancelling part of the historic regional debt, estimated at around €11,000 million for the Valencian Community, Llorca stated that if the Spanish parliament passes a law, his government will abide by it even though it does not share the measure. This stance contrasts with the outright rejection of debt forgiveness by other PP regional leaders.
I am respectful of institutions, and if a law is passed in the Cortes, we will abide by it. Of course, even if we don’t share it.
Political reactions
After the meeting, Compromís spokesperson Joan Baldoví harshly criticised the president. He accused Llorca of not being up to the moment, of failing to raise the debt issue with the minister, and of acting as a messenger for PP national leader Alberto Núñez Feijóo and Madrid president Isabel Díaz Ayuso. Baldoví called the president’s appearance after the meeting extremely weak and urged him to accept bilateral negotiations with the central government.
Whom was Pérez Llorca representing, five million Valencians or Feijóo?
The minister, for his part, regretted that PP regional leaders “do not sit down to negotiate because they are not allowed to sit down to negotiate”, and dismissed Llorca’s demand for the CPFF as an excuse.
