The Government defies the blockade and repeats the rejected fiscal path to save the 2027 Budgets

The Government will return this Thursday to Congress with the same fiscal path that was rejected last week. The Council of Ministers has again approved the deficit targets for the period 2027-2029, without modifying the distribution between the State, Social Security, autonomous communities, and city councils.

The decision allows the Treasury to exhaust the procedure provided by law and keep open the preparation of the General State Budgets for 2027. The Executive assumes that it may suffer a second defeat, but maintains that parliamentary rejection will not prevent presenting the accounts after the summer.

The vote will close the political year in Congress with a majority apparently identical to that of a week ago. PP, the far-right Vox, Junts, and UPN then rejected the proposal, while Podemos and Compromís deputy Águeda Micó abstained. None of these groups has so far announced a change that would allow the Government to achieve the necessary support.

The same numbers that Congress already rejected

The path sets a deficit of 1.8% of GDP for all public administrations in 2027, which would fall to 1.6% in 2028 and 1.5% in 2029. The central administration would concentrate most of the margin, with a target of 1.5% next year, compared to 0.2% assigned to Social Security.

The autonomous communities could close each of the three fiscal years with a deficit of 0.1% of GDP, while city councils would have to maintain budget balance. This distribution was approved by the Fiscal and Financial Policy Council despite the rejection of the PP's regional governments.

The opposition questions that the State reserves most of the margin while the communities manage essential services such as health, education, and dependency. The Treasury responds that the proposal improves the balance scenario that would apply to the autonomies if Congress votes against it again.

The deficit path is presented along with the 2027 spending ceiling, set at a record figure of 226,032 million euros, 6.6% more than the previous year. This limit is already approved and does not need the support of the Cortes, so Thursday's vote will only affect stability and debt targets.

Almost 5,849 million for the communities

The Government's main argument focuses on the one-tenth of a deficit granted to the autonomous communities. According to Treasury calculations, this margin would allow regional governments to have an additional 5,849 million euros between 2027 and 2029 to prepare their budgets.

Madrid would have 1,226 million more during those three years, Catalonia would obtain 1,202 million, and Andalusia would have another 1,092 million. The Valencian Community would add 542 million, while Castilla-La Mancha, Castilla y León, and Galicia would receive margins of 288, 282, and 272 million, respectively.

The Minister of Finance, Arcadi España, has used these figures to particularly pressure the PP. He considers it contradictory that their communities demand more resources and that their deputies vote against a path that grants them greater spending capacity.

The 'popular' party replies that one-tenth is insufficient compared to the margin enjoyed by the central administration and demands a different distribution. Junts maintains a similar position regarding Catalonia and believes that the proposal continues to concentrate too much fiscal capacity in the State.

A second defeat opens a gray area

The Organic Law on Budgetary Stability establishes that, after a first rejection, the Government has one month to submit a new proposal. The text may contain different figures or repeat exactly the previous ones, as the Treasury has decided to do.

The law is silent on the consequences of a second defeat. This absence of an express way out places the Executive in an unexplored scenario, although it does not automatically imply that it must abandon the Budgets.

The Treasury's interpretation is that, once the parliamentary procedure is exhausted, the general objectives committed to Brussels in the medium-term fiscal plan would remain in force. The Government could draft the 2027 accounts within that framework and fulfill its constitutional obligation to present a budget project.

The main difference would be in the autonomous communities. The plan sent to the European Union contemplates budgetary balance for this subsector, so a new rejection would eliminate the additional tenth and force regional governments to work with a more demanding objective.

This path has never been applied in Spain. The Treasury studied a similar solution in 2024, when Congress also rejected the fiscal targets twice, but the Executive ended up giving up on presenting new Budgets and kept the previous accounts extended.

The Budgets still without a majority

Overcoming the legal process does not solve the political problem. The Government can present the Budget project, but it will then need to build a majority to prevent Congress from returning it through an amendment to the whole.

Junts once again occupies a decisive position. Their rejection of the fiscal path shows that the relationship with the Executive remains far from the understanding necessary to move forward with complete accounts, where each formation will also present its own territorial and political demands.

Podemos also did not support the proposal in the first vote and demanded a more ambitious fiscal policy. Compromís's abstention also reflected the reservations of some partners about the distribution of resources and the autonomous financing model.

The Treasury intends to first close the project with Sumar and then begin conversations with the groups. The stated intention is to bring the 2027 Budgets to Congress in October, after three consecutive years with the 2023 accounts extended.

Before that, the second vote on the path must take place. Thursday's plenary session will determine whether the communities retain the 5,849 million margin offered by the Treasury or whether the Government begins the budgetary drafting with another parliamentary defeat and a stricter fiscal target for the autonomous communities.