Antonio Garamendi, president of the CEOE, has formally urged the Spanish government to approve new General State Budgets, noting that the country has operated under prorogued accounts for three years. The demand comes as the Executive branch sets a record spending ceiling of 226.032 million euros for the upcoming fiscal cycle.
Why the CEOE is demanding new budgets
Garamendi addressed the General Assembly of the patronal de pequeñas y medianas empresas Cepyme on Monday, criticizing the government’s reliance on extended budgets.
"It doesn’t make much sense that the top Spanish company, which is the State, hasn’t had a budget in three years," Garamendi stated. He compared the government’s fiscal management to a private firm, asserting that no executive in the private sector would survive a tenure without presenting a budget. According to the CEOE leader, the current economic climate requires "confidence," which he contends cannot be established while the country functions on outdated financial planning.
Concerns over the "social monologue"
The relationship between the government and social partners has deteriorated, according to business leadership. Garamendi characterized the current state of "social dialogue" as a "social monologue," noting that the government increasingly bypasses traditional negotiation channels.
The CEOE president highlighted that the Ministry of Labor has modified the labor reform 61 times since its initial signing. He also raised concerns regarding the trend of shifting legislative debates away from Parliament in favor of decree-laws and subsequent regulations that do not require congressional oversight, a practice he described as "hyper-regulation."
The fiscal and operational challenges for SMEs
Ángela de Miguel, president of Cepyme, opened the assembly by emphasizing the specific pressures facing small and medium-sized enterprises (SMEs). She noted that the organization’s primary role is to represent these businesses honestly, even when decisions are made by public authorities without consulting the realities of small firms.
De Miguel highlighted several critical issues affecting the sector:
- Labor Costs: De Miguel criticized the successive increases in the Minimum Interprofessional Wage (SMI), noting that the total cost to the company reaches 1.900 euros per month when taxes and contributions are included.
- Absenteeism: Garamendi renewed calls for the Social Security system to assume the costs of medical leaves between the fourth and fifteenth day, citing a sharp rise in incapacities, particularly among workers under 35 and specifically on Mondays and Fridays.
Generational succession and the future of SMEs
The assembly also addressed the demographic risks facing Spanish businesses. According to Cepyme, half of all Spanish SMEs are led by individuals over the age of 50, and one in five are headed by those over 60. This creates a significant risk regarding generational transition, as many businesses fail during the succession process rather than due to poor business performance.
To address these challenges, Cepyme is advocating for the application of the European "Think Small First" principle, which requires policymakers to design regulations with the needs of small businesses in mind. The organization is also focusing on international representation, with De Miguel recently appointed as vice president of SME United, an entity representing 26 million European small and medium enterprises.