The Bank of Spain has published this Tuesday the last official data on public debt before next Sunday’s elections and the body’s data reveals that, under the mandate of Pedro Sánchez, liabilities have skyrocketed in 376,000 million. In fact, the figure will be even higher, because the BdE data refer to the month of May, the month in which the debt amounted to 1,542 billion euros. But based on historical developments, it seems very likely that the liability has grown even more since then.
In any case, the increase in debt under Sánchez’s management is spectacular. The response to the crisis derived from Covid is a basic part of this increase, and in fact from Europe it was indicated that the recipe to face the complex situation was to borrow. But already before that, the liability had grown very strongly. For example, only between July 2018, which is when the current president accesses Moncloa, and December 2019, the increase exceeds 57,000 million. And between the beginning of 2022 and the aforementioned month of May 2023, the rebound is close to 115,000 million more.
During Sánchez’s presidency, moreover, has crossed the barrier of 1.5 trillion euros of debt, and all the data assume historical maximums. Another very significant milestone is that the debt of the Social Security Administrations far exceeds 100,000 million. Specifically, 106,169 million, according to the latest data.
And another finding during the Sánchez government, in addition to the incessant increase in debt, is that both the Bank of Spain itself and the Independent Authority for Fiscal Responsibility (AIReF) have asked the Executive, on numerous occasions, a plan to tackle the passive. To contain it, at least, in the medium term and to reduce it in relative terms, that is, in relation to GDP. But the requests have been totally unsuccessful, because the Government has not applied any action of this type. “It’s not the moment“, the Ministry of Finance has responded on more than one occasion to the requests of the Tax Authority.
The latest BdE figures in this regard indicate that the debt is at 112% of GDP. There has been a reduction in recent quarters, yes, but according to supervisors it is simply due to pure growth in the economy. The GDP advances more than the debt and the result is a drop in relative terms.