Catalan premier warns finance minister he is “playing with fire”

Acting Catalan premier Artur Mas on Tuesday issued a warning to Spain’s finance minister over the latter’s claim that Catalonia concealed over €1.3 billion worth of bills for public works projects.

A committee of technicians from the Bank of Spain, the National Statistics Institute and the State Comptroller’s Office are investigating why the Catalan government failed to include this amount in its official accounting.

The gap was uncovered by Eurostat when it reviewed budget data filed by Spain’s government agencies

The gap was uncovered by Eurostat, the European statistics bureau, when it reviewed budget data filed by Spain’s government agencies.

But Mas framed the issue as part of Spain’s “attack” on Catalonia over his own separatist bid, and told Finance Minister Cristóbal Montoro that he is “playing with fire.”

News of the budget gap was revealed by Montoro on Monday. The €1.3 billion represents “contracts for private-public partnerships from over a decade ago” created to build roads and penitentiaries in the region.

Based on this new finding, the Finance Ministry now wants control over Catalonia’s public spending if the latter wants to keep accessing the Spanish state’s liquidity fund FLA, created in 2012 to help struggling regional governments service their debts without having to seek funding on the markets.

Catalonia received €6.6 billion in 2012 and €10 billion in 2013 from this regional bailout fund.

But access to this cheap credit line could now be cut off if the Catalan government does not comply with Madrid’s demands for greater oversight over the way the money is spent, to prevent state aid from being used to fund “independence whims,” in Montoro’s words.

Last Friday, the Spanish executive approved a new cash injection for Catalonia worth over €3 billion to help the regional government pay suppliers and finance a hepatitis C vaccination campaign. But the money will not be released until Madrid is satisfied with Catalonia’s response to its demand.

Artur Mas, who has been spearheading the separatist drive in Catalonia, called this decision “punishment.”

Last Friday, the Spanish executive approved a new cash injection for Catalonia worth over €3 billion

“Catalonia is being punished and harmed for defending peaceful, democratic ideas that are respectful of human rights, and I think that is tremendously serious and alarmingly lacking in democratic qualities,” said Mas.

Mas also said that the accusation of having concealed information about regional expenses is “an outright lie.” He said that the central government has used the same kind of off-the-books methods to finance the high-speed rail system AVE and to mop up the debt left behind by Madrid’s underutilized radial road projects.

“Minister Montoro is playing with fire and he will get burnt if he continues along these lines,” said Mas. “It’s the Spanish state that has a financing problem. Where is the debt for [railway infrastructure manager] Adif and all the kilometers of the AVE? It’s not in the budget. The day that the EU takes notice of that, how will [Madrid] defend itself?”

Asked when Catalonia will pay its outstanding debt with suppliers, Mas said that it depends on whether the FLA money arrives, since Catalonia cannot raise money on the markets. The ratings agency Fitch recently downgraded Catalan debt to junk status.

Catalonia is being punished and harmed for defending peaceful, democratic ideas that are respectful of human rights” Acting premier Artur Mas

Mas said that the way forward is to keep pushing for secession and get “the 48 percent who voted for independence on September 27 to become more than 50 percent in a few months, because every time they attack us, more people will become convinced that either we walk down the road of sovereignty or we will be eaten up by the state’s machinery.”

Despite the criticism, Mas expressed a willingness to talk to the new government that will emerge from general elections scheduled for December 20, when the ruling Popular Party (PP) is expected to lose its absolute majority.

Mas himself is struggling to retain control of the Catalan government. A month after winning the regional elections, deep divisions within his separatist alliance have prevented him from getting appointed to a new term in office. If agreement is not reached within the next few weeks, new Catalan elections will be called.

English version by Susana Urra.