Generalitat de Catalunya Government of Catalonia Budget...

Budget 2017

Generalitat de Catalunya

Government of Catalonia

Budget

2017

Budget 2017



The Nelson Mandela Bridge takes its name in honor of one of the most important politicians of the history who knew how to tend bridges in the fight against the apartheid in his country. Placed in El Prat de Llobregat, between the Port

of Barcelona and Barcelona-El Prat airport. Beside the natural protected areas of the Llobregat Delta and of the Llobregat Agrarian Park. It communicates the urban area of the Prat with the industrial estate and the ZAL. Symbol of the

political understanding, of the connection of Catalonia with the world, of the relation among the city, the industry and the land.

Barcelona, March 28, 2017

Budget 2017



PREPARING THE FUTURE CATALONIA:

Social cohesion, balanced growth, quality

public services and institutional

development

3

Budget 2017



MAIN FEATURES OF THE BUDGET FOR 2017

2.7%

€1,355 m* Social spending increase over 2015

The economy evolves

positively, but lower than

2016

Real GDP growth

forecast

0.6%*

Raised to 0.6% GDP during the

Parliamentary procedure (but still

0.6 pp below law distribution)

Deficit target

(% GDP)

7.8%

It includes tax measures and an own

prudent estimate of the advance

payments and settlements stated in

the regional financing system

Non-financial and non-earmarked

revenue increase over 2015

-0.3 points

Restoring long-term sustainability.

Debt grows below GDP growth

Debt to GDP ratio

reduction

€22,611m

Higher revenues and lower interest payments

allows a higher spending increase

Non-earmarked, non-financial

(NNF) departmental spending

74.8%

The share of social spending

raises up to 2.9 pp

% social spending over

NNF spending

4

Priority of Social spending

(79% of the total departmental increase)

* Draft Budget was elaborated considering a deficit target of 0.5% GDP. Later a new deficit target (0.6% of GDP) was approved. This extra deficit will allow to raise Education budget (140M€) and the future

guaranteed income (45M€).

Budget 2017



ECONOMIC AND FISCAL CONTEXT AND BUDGETARY FRAMEWORK

1

5

Budget 2017



Macroeconomic growth is consolidated, thanks to the Catalonia’s position in the world, and begins to reach citizen’s households

6

Budget 2017



THE ECONOMIC GROWTH IS CONSOLIDATED

2.7% real GPD growth expected

in 2017

The growth is consolidated. The forecasts shows

that Catalonia will grow more than the average in

the euro Zone (1,5%) and in Spain (2,3%). The

real GPD in 2017 will be 232.083 M€

2.2% full time jobs growth

expected in 2017

Expected to create 69 thousand jobs and

unemployment rate continues with its trend of

reduction

Source: Idescat and Ministry of the Vice-presidency and of the Economy and Finance.

7

3.4 3.4

2.7

0

1

2

3

4

5

2015 2016 (e) 2017 (e)

Real GDP market prices (% annual change)

71.6

91.4

69.0

18.6 16.0

14.4

0

5

10

15

20

25

30

0

20

40

60

80

100

2015 2016 (e) 2017 (e)

un

em

plo

ym

en

t ra

te (

%)

Job

s cre

ate

d (

tho

usa

nd

s)

Job creation and unemployment rate

Jobs created (thousands) unemployment rate (EPA) (% unemployed /active population)

Budget 2017



INCREASE IN EXPORTS AND FOREING DIRECT INVESTMENT (FDI)

0.5% growth contribution of

the external balance

For 2017 exports are expected to grow over

imports

60% increase in FDI in 2015

The incremental current trend confirms the

confidence of foreign companies to invest in

Catalonia, with a greater ability to attract than

in the years before the crisis

Source: Idescat and Ministry of the Vice-presidency and of the Economy and Finance

+60%

Note: it does not include entities of foreign values possession

+6,1%

8

40.000

50.000

60.000

70.000

2006 2007 2008 2009 2010 2011 2012 2013 2014 2015

In m

illi

on

€

Evolution of the asset’s export abroad

0

1.000

2.000

3.000

4.000

5.000

6.000

1993 1995 1997 1999 2001 2003 2005 2007 2009 2011 2013 2015

Direct foreign investment (FDI) in Catalunya (millions of euros)

Budget 2017



After the strong impact of the economic

and fiscal crisis, poverty and inequality are

moderating

The levels of poverty and inequality are attenuated by the

income households in 2014 and it is expected to continue

this improvement given the evolution of the economy. But

levels are still high

ECONOMIC RECOVER BEGINS ARRIVING IN HOMES

Domestic economy improves its indicators

The number of affiliates to Social Security in September

2016 is 11% higher than at the end of 2013, while

household consumption increases 7,6% in constant values.

The household debt has been reduced by 7% between the

last quarter of 2013 and the second of 2016. But the long-

term unemployed shows a slow reduction

Source: Idescat and INE.

Note: The incomes are from the year prior to the reference year

Poverty and inequality indicators

2014 2015

Poverty indicators

% of population at risk of poverty 20.9 19.0

AROPE rate 26.0 23.5

% of population at risk of severe poverty 11.7 10.6

Income inequality

Gini Index 33.0 32.3

Index S80/20 6.5 6.0

9

Budget 2017



Revenue increase due to the economic performance and the new tax measures

10

Budget 2017



NON-FINANCIAL AND NON-EARMARKED REVENUES EVOLUTION

Non-financial and non-earmarked revenues Budget

2015

Outturn

2015

Budget

2017

Var. 2017 /

2015

Var. 2017 /

2015 Actual

M€ % M€ % Personal income tax (advanced payment) 7,418.6 7,418.6 8,038.9 620.3 8.4 620.3 8.4

VAT (advance payment) 5,762.0 5,762.0 6,119.0 357.0 6.2 357.0 6.2

Special taxes (tobacco, alcohol, hydrocarbons and energy) (adv.pay.) 2,256.7 2,256.7 2,419.4 162.7 7.2 162.7 7.2

Overall Sufficiency Fund (advanced payment) 626.0 626.0 773.8 147.7 23.6 147.7 23.6

Guarantee Fund for Fundamental Services (advanced payment) -845.0 -845.0 -868.2 -23.2 2.7 -23.2 2.7

Regional financing system advanced payments 15,218.4 15,218.4 16,482.9 1,264.6 8.3 1,264.6 8.3

Settlements t-2 163.1 269.3 1,616.2 1,453.1 891.2 1,346.9 500.1

Negative settlements 2008 and 2009 -124.8 -124.8 -124.8 0.0 0.0 0.0 -

Regional financing system advanced payments and settlem. 15,256.6 15,362.9 17,974.3 2,717.7 17.8 2,611.4 17.0

Inheritance and donations tax 424.1 484.4 547.4 123.3 29.1 63.0 13.0

Wealth tax 441.5 461.7 517.4 75.9 17.2 55.7 12.1

Tax on transfers and documented legal acts 1,336.4 1,474.2 1,755.7 419.3 31.4 281.5 19.1

Vehicle registration tax 63.6 68.5 74.4 10.8 16.9 5.8 8.5

Tax on hydrocarbons autonomous rate 212.6 211.8 229.8 17.1 8.1 17.9 8.5

Environmental taxes 40.1 30.4 34.6 -5.5 -13.8 4.2 13.7

Taxation on gambling 193.2 206.3 228.9 35.7 18.5 22.6 10.9

Tax on large commercial establishments 16.2 15.0 14.6 -1.5 -9.4 -0.4 -2.5

Tax on stays in tourist accommodation establishments 43.9 43.2 50.5 6.6 15.1 7.3 16.9

State tax on bank deposits 0.0 90.0 63.3 63.3 - -26.8 -

Tax on empty housing 8.8 0.0 11.5 2.7 30.7 11.5 -

Tax on the provision of content by providers of electronic

communications services 10.3 7.3 16.1 5.9 57.4 8.8 121.0

Tax on beverage with excess sugar - - 31.0

Totally transferred and own taxes 2,790.7 3,093.0 3,575.2 784.5 28.1 482.2 15.6

Other non-financial revenues 495.4 699.5 519.4 24.0 4.8 -180.2 -25.8

Other revenues from financing system - - 619.0 619.0 - 619.0 -

AD3a EAC + Competitive fund + tax on bank deposits 2,183.1 - - -2,183.1 -100.0 - -

Disposal of property investment 316.7 3.9 0.0 -316.7 -100.0 -3.9 -100.0

Other non-financial revenues 2,995.2 703.4 1,138.4 -1,856.8 -62.0 434.9 61.8

Total non-earmarked non-financial revenues 21,042.4 19,159.3 22,687.9 1,645.4 7.8 3,528.5 18.4

€1,645.4 m Revenue growth Compared to the budget 2015

Estimate of the revenue coming

from advance payments and

settlements (own estimate based

on GDP variation) increases

€2,717.7 m

Good performance of own taxes

and totally transferred taxes, along

with implemented tax measures

lead to an increase of €784.5 m

Consequently, dependency on

other sources of revenue has

been reduced.

11 Imports in million of euros

Budget 2017



PRUDENT ESTIMATION OF REGIONAL FINANCING SYSTEM REVENUES

7.8 7.7 7.6 7.7 7.4 7.4 7.6 7.5

4

5

6

7

8

2010 2011 2012 2013 2014 2015 2016 2017

advanced payments (% GDP)

€1,616.2 m settlement 2015

This amount will be received in 2017. In recent

years, the amount of the settlements greatly

exceeded the advance payments.

+€749 m more than received in 2016

The Spanish Government communicated to the

Catalan Government an advance payment

calculated on the basis of its budget 2016,

which has been extended until adoption of

budget 2017. The Catalan Government has

made an estimate taking as a reference the

advance payments as a percentage of GDP in

the last years.

12

Budget 2017



THE IMPACT OF NEW TAX MEASURES

Tax Budget

2017

Annual

impact

Tax on beverage with excess sugar 31.0 41.3

Environmental risk tax on the production, handling and transport, custody and

emission of radioactive elements 28.3 62.8

New taxes 59.3 104.1

Increase in tax rates on property transfers 4.0 4.8

Increase in tax rates on documented legal acts 18.7 22.4

Increase in tax rates on gambling 9.4 12.6

Tax on large commercial establishments 14.6 17.8

Tax on stays in tourist accommodation establishments 3.8 7.7

Tax on empty housing -- -0.3

Modification of personal income tax deduction -- 12.7

Modification of taxes 50.5 77.7

Total tax measures 109.8 181.8

Imports in million of euros

€181.8 m

increase in revenues due to tax

measures

New taxes improve equity and reduce negative

externalities

13

Budget 2017



THE IMPACT OF TAX MEASURES

Imports in million of euros (1) Declared unconstitutional (the settlement of the Tax on deposits in credit institutions was not effective). (2) Pending resolution of the appeal filed by the State before the Constitutional Court.

€1,281.2 m

Impact of the all tax

measures taken from 2012

14

Tax measures Outturn Estimation Budget

2012 2013 2014 2015 2016 2017

Tax on wealth (recovery and increase of taxation) 305.0 562.7 431.3 461.7 504.3 517.4

Increase in tax rates on documented legal acts tax 40.5 45.6 49.0 63.5 67.1 91.3

Increase in the rates of the autonomous section of the hydrocarbon tax 60.8 139.0 109.1 106.0 102.8 115.0

Tax on stays in tourist establishments -- 35.2 41.0 43.2 45.3 50.5

Tax on large commercial establishments -- -- -- -- -- 14.6

Increase in property transfers tax rates -- 35.0 174.7 199.4 216.9 245.2

Reform of inheritance tax -- -- 45.2 130.5 110.9 140.8

Reform of the civil protection levy -- -- -- -- 0.2 0.2

Taxation on gambling -- -- -- -- -- 9.4

Modification of taxes 406.2 817.6 850.2 1,004.4 1,047.5 1,184.5

Pharmaceutical prescription or product tax (1) 45.6 4.3 -- -- -- --

Judicial fees 5.1 2.1 0.0 2.3 2.3 3.5

Tax on bank deposits (1) -- -- 688.3 -- -- --

Tax on the provision of content by providers of electronic communications

services (2) -- -- -- 7.3 15.5 16.1

Tax on the production of electric energy of nuclear origin (1) -- -- -- 30.3 -- --

Tax on the emission of gases and particles into the atmosphere produced by

industry -- -- -- 0.1 1.0 2.2

Tax on the emission of gases and particles into the atmosphere commercial

aviation -- -- -- -- 3.0 4.1

Tax on empty housing(2) -- -- -- -- 11.5 11.5

Tax on beverages with excess sugar -- -- -- -- -- 31.0

Environmental risk tax on the production, handling and transport, custody and

emission of radioactive elements -- -- -- -- -- 28.3

Creation of new taxes 50.7 6.4 688.3 40.0 33.2 96.7

Total tax measures 456.9 824.0 1,538.5 1,044.3 1,080.6 1,281.2

Budget 2017



Sustainability of finances and improved payment terms to suppliers to reduce financial dependence

15

Budget 2017



DEFICIT REDUCTION

0.6% deficit as % of GDP

Raised to 0.5% GDP during the Parliamentary

procedure

The deficit target should be above

1%

The allocation of the deficit objectives continues

not to reflect who is responsible for the

expenditure, breaching with the Law of Budget

Stability (and AIReF’s recommendation)

Deficit target by government level 2017 (% GDP)

Initial targets (1)

Target revision

2016 (2)

Target distribution

consistent stability

law (3)

Central Administration -1.30 -2.40 -1.92

Central Government -1.10 -1.50 -

Social Security -0.20 -0.90 -

Autonomous communities -0.10 -0.50 -1.18

Local government 0.00 0.00 0

Total administrations -1.40 -2.90 -3.10

(*) Observed deficit with one-off operations -2.67 (2014) and -2.89 (2015). (1) Approved on July 15th 2015 by Congress. (2) Targets included in the 2016 Stability Program, approved by Council of Ministers on April

29th 2016 (3) Total deficit target approved by European Commission August 8th 2016, distributed by government levels in accordance to stability law. 16

Source: IGAE and Ministry of the Vice-presidency and of the Economy and Finance staff calculation.

-0.24

-0.60

-2.52 -2.33

-4.48 -4.11

-2.27 -2.14

-2.53*

-1.93*

-0.93 -0.60

-5

-4

-3

-2

-1

0

2006

outturn

2007

outturn

2008

outturn

2009

outturn

2010

outturn

2011

outturn

2012

outturn

2013

outturn

2014

outturn

2015

outturn

2016

target

2017

target

Deficit evolution and propect (% of GDP)

Budget 2017



THE AVERAGE PERIOD FOR PAYMENT TO SUPPLIERS HAVE BEEN REDUCED

-38 days of reduction in the

average period of payment

From the maximum of 67 day in November

2015 to 29 days in December 2016

17

-€2,858 m of reduction in

pending payments Between October 2015 and October 2016

The most significant percentage reductions are

in aid for families and long-term care

*Values in terms of days.

43

47

54

48

42 43 45

40

35

40 41

48

62 63

67

59

36

32 32 33

39 38

21

29 28

0

10

20

30

40

50

60

70

80

Sept.

'14

Oct.

'14

Nov.

'14

Des.

'14

Jan.

'15

Feb.

'15

Mar.

'15

Apr.

'15

May.

'15

Jun.

'15

Jul.

'15

Aug.

'15

Sept.

'15

Oct.

'15

Nov.

'15

Des.

'15

Jan.

'16

Feb.

'16

Mar.

'16

Apr.

'16

May.

'16

Jun.

'16

Jul.

'16

Aug.

'16

Sept.

'16

Average period of global payment providers including social services

Budget 2017



DEBT-TO-GDP RATIO IS DECLINING

-0.3 points of debt-to-GDP

ratio reduction

It fells from 35.4% (2016) to 35.1% (2017)

The debt at 31 December 2017 is expected to

be 77,495 million euros.

2.8% of projected increase in

debt

The lowest growth rate of debt since 2007 and

close to real GDP growth that is 2.7%

(1) Forecast balance of outstanding debt at 31 December 2016, after the introduction extraordinary FLA corresponding to deficit deviation of 2015.

(2) Forecast balance of outstanding debt at 31 December 2017 according to deficit forecast for this year + negative settlement for 2008 and 2009. 18

7.8% 7.8%

10.0%

12.7%

17.5%

22.0%

26.8%

30.1%

32.9%

35.7% 35.8% 35.4%

6.1%

32.0%

23.2%

38.8%

23.8%

18.7%

11.1% 10.8% 12.7%

5.0%

1.6% 0%

5%

10%

15%

20%

25%

30%

35%

40%

45%

0%

5%

10%

15%

20%

25%

30%

35%

40%

2006

2007

2008

2009

2010

2011

2012

2013

2014

2015

2016 (

1)

2017 (

2)

Deb

t g

row

th (

%)

Deb

t (%

GD

P)

Debt evolution

Debt-to-GDP Debt growth

Budget 2017



Spending grows thanks to the higher revenues and the reduction of interest expenditure despite having a lower deficit target for 2017

19

Budget 2017



+

+

-

-

DEPARTMENTS’ SPENDING LIMIT

€1,521.1 m

Increase of departmental

spending limit

The higher revenues and the reduction of

interest payments allows a higher increase

in spending

NON-FINANCIAL

REVENUES (non-earmarked)

€22,687.9m

NON-FINACIAL

SPENDING LIMIT* (non-earmarked)

€24,442.0m

DEFICIT TARGET

€1,095.2m

ESA ADJUSTMENTS

€659.0m

+€1,645.4m

+€1,051.8m*

DEPARTMENTS

SPENDING LIMIT*(non-

financial & non-earmarked)

€22,610.6m

+€1,521.1m*

INTEREST

€799.3m

-€344.7m

-€248.9 m

NON- DEPT. FUNDS

€1,032.1m

-€913.9m

+€444.6m

Variations over

Budget 2015

20

Amounts in million euros

* The new deficit target allows to raise the spending limits during budget execution

Budget 2017



SPENDING PRIORITISATION 2

21

Budget 2017



BUDGET PRIORITIES

Equal opportunities, equity and

reduction of inequalities

Quality public services

Economic growth: R+D+I,

infrastructures and productive

sectors

Transparency, evaluation and

institutional development

Preparing the future Catalonia

Social cohesion, balanced growth, quality

public services and institutional

development

22

Budget 2017


Government of Catalonia Budget section

Budget

2015 1

Budget

2017

Var. 2017/2015h

M€ Distrib.%

Presidency 404.2 411.7 7.5 0.5

Vice-presidency and of the Economy and Finance 137.1 195.0 57.9 3.8

Transp. and Foreign and Institutional Relations and Affairs 34.2 64.0 29.8 2.0

Governance, Public Administrations and Housing 390.0 424.7 34.7 2.3

Education 4,432.5 4,771.0 338.6 22.3

Health 8,342.1 8,750.5 408.4 26.8

Home Affairs 1,160.9 1,246.4 85.5 5.6

Territory and Sustainability 1,471.3 1,668.6 197.3 13.0

Culture 228.7 250.6 21.9 1.4

Justice 914.6 949.6 35.0 2.3

Labour, Social Affairs and Families 2,106.0 2,299.7 193.8 12.7

Business and Knowledge 1,200.2 1,274.6 74.4 4.9

Agriculture, Livestock, Fisheries and Food 267.7 304.0 36.3 2.4

Subtotal Departments 21,089.5 22,610.6 1,521.1 100.0

Contingency fund 200.0 330.0 130.0

Other non-department funds 307.8 619.9 312.1

Higher bodies 79.7 82.2 2.5

Debt (interest) 1,713.2 799.3 -913.9

Total non-financing non-earmarked spending 23,390.2 24,442.0 1,051.8

Total primary spending (without interest) 21,677.0 23,642.7 1,965.7

Departmental distribution of non-financial non-earmarked spending limit

(1) According to new distribution of responsibilities

Resources

allocated to

priorities

23

Amounts in million of euros

Budget 2017



1.355 M€ INCREASE OF SOCIAL SPENDING

Non-financial non-earmarked social spending Total

variation(1)

Variation

of social

spending(1)

Health 408.4 408.4

Education 478.6 478.6

Labour, Social Affairs and Families 238.8 238.8

Territory and Sustainability 197.3 153.6

Business and Knowledge 74.4 46.5

Home Affairs 85.5 --

Justice 35.0 --

Governance Public Administrations and Housing 34.7 29.0

Agriculture, Livestock, Fisheries and Food 36.3 --

Vice-presidency and of the Economy and Finance 57.9 --

Culture 21.9 --

Transparency and Foreign and Institutional Relations and Affairs 29.8 --

Presidency 7.5 --

Total departments 1,706.1 1,354.8

79% of total increase is

allocated to social spending

To attend to basic social needs and vulnerable

people

79% 1,354.8M€

21%

17%

Altres 30%

35%

18%

Share of social spending over total

variation

Departmental distribution

of social spending increase 24

Imports in millions euros


Budget 2017



ALMOST 75% OF RESOURCES ARE ALLOCATED TO SOCIAL SPENDING*

Non-financial non-earmarked social spending Budget

2015(1) Budget*

2017 Variation

2017/2015

Health 8,342.1 8,750.5 408.4

Education and Universities 5,211.5 5,736.6 525.1

Labour, social affairs and families 2,106.0 2,344.7 238.7

Housing, districts and old towns 161.0 190.0 29.0

Public passenger transport 841.4 995.0 153.6

Total social spending 16,662.0 18,016.8 1,354.8

Total adjusted Generalitat (2) 23,190.2 24,071.3

71.8% 74.8%

74.8% of spending is allocated

to social spending*

The weight of social spending increases

25

(1) Homogeneous in line with current areas of responsibility

(2) Excluding Contingency Fund and funds to meet the partial refund of the pending extra pay to distribute to departments

Amounts in millions euros

* Including additional 140 M€ allocated to Education and 45 M€ allocated to Labour, Social Affairs and Families during the parliamentary process.

Budget 2017



EDUCATION, AN INVESTMENT FOR EQUAL OPPORTUNITIES

+525.1 millions euros to improve educational services*

to attend to the increase in number of students and the

reduction school day by one hour and to improve

student care.

for centers of high complexity

To meet the needs of 237 schools and 103 secondary

schools of high complexity

for inclusive school

New teaching positions and new support teaching positions

to improve replacement of teaching staff

It will cover from the first day work permits of more than 7

days and work leaves of the course start from September 1

+€12 m for scholarship dining

By ensuring that all families below the risk-of-poverty-

threshold have it

27% more resources for shared schooling units

+€46,5 m to finance public universities

The 2011 spending levels have been recovered and the education

system is provided with the highest number of teachers

Note: comparison with the last approved budget by the Parliament (2015). Allocation data 2013 and 2016 correspond to non approved budget projects.

* Including additional €140 m allocated during the parliamentary process. Equivalent to 3,500 new teaching staff , pending to specify during the budget implementation. 26

+7.099 teaching staff*

10.000

20.000

30.000

40.000

50.000

60.000

70.000

80.000

0

1.000

2.000

3.000

4.000

5.000

6.000

2003 2004 2005 2006 2007 2008 2009 2010 2011 2012 2013 2014 2015 2016 2017

persons M€

Education department budget evolution and number of

teaching staff

Education department budget teaching staff

Budget 2017



HEALTH, CENTRAL ELEMENT TO ENSURE SOCIAL COHESION AND WELFARE

+408,4 millions euros more to make progress on the achievement of an universal, public and equal system

Ensuring the universal health coverage

+€127,7 m to cover the increase of prescriptions and

new approved medicines

+€35 m more to reduce waiting lists

Surgical intervention, diagnostic test or specialist visits.

+€99 m to improve the attention system for people

with mental health problems

Focusing on a community-based model on prevention,

employability and accompaniment to families

+€83 m more for Hospital Medication of Ambulatory

Dispensing (HMAD)

New drugs, purchasing centralization of oncological

medicines and efficiency gains in treatment purchase

+€26 m to improve infrastructures and health

facilities Recovered the level of Health spending, which is one of the

Government’s key priorities

27 Note: comparison with the last approved budget by the Parliament (2015)

0

2.000

4.000

6.000

8.000

10.000

12.000

2003 2004 2005 2006 2007 2008 2009 2010 2011 2012 2013 2014 2015 2016 2017

M€

Heath department budget evolution

Budget 2017



SPECIAL ATTENTION TO THE MOST VULNERABLE PEOPLE

LABOUR, SOCIAL AFFAIRS AND FAMILIES: +238.8 millions more for social inclusion to build a fairer and

equitable society*

€288 m for the integration minimum income

+105 M€ more for economic benefits and insertion policies

Improving long-term care

+53 M€ new concerted jobs

+14 M€ for the operation of residential and day centres

+€42 m Home care services

More resources for programme contracts with local

authorities

+€18 m to attend to children and adolescents in risk

210 new residential positions

€6,5 m care services of local authorities

€3,1 m economic benefits to the reception

+€20 m for special employment centres

€10 m to tackle energy poverty Additional €105 m for provision of the minimum integration income

(RMI) and associated active employment policies. Progressing towards a

guaranteed income.

It incorporates the

increase of active

employment policies

associated to the RMI*

28 Note: comparison with the last approved budget by the Parliament (2015)

* Including additional €45 m allocated during the parliamentary process.

0

50

100

150

200

250

2003 2004 2005 2006 2007 2008 2009 2010 2011 2012 2013 2014 2015 2016 2017

Minimum integration income evolution (M€)

Budget 2017



HOUSING AND PUBLIC TRANSPORT, SOCIAL RIGHTS

+€13 m to attend to housing emergency and eviction policy

for economic and social reasons

63M€ are allocated to benefits and family support and the budget

line for implementing the Law on protect rights to housing of people

at risk of social exclusion measures increases by 9,7 M€ to 35,6 M€

€11.5 m Tax on empty housing

Lifting of the suspension by the Constitutional Court and it is

allocated to housing policies

+€19 m Fund to encourage neighbourhood programme

Maintaining the commitment to support the comprehensive

rehabilitation of neighbourhoods and urban areas

+€58 m for FGC (including the extension of Terrassa and

Sabadell)

+€62.5 m for the Metropolitan Transport Authority (ATM)

Implementation of the integrated fare system “T-Mobilitat” all around

Catalonia and social pricing and the functioning of the new stretch of

Line 9 (L9)

+€9 m for Express Bus and for further improving the road

passenger transport services

+€9 m for continuing works in L9/L10 towards Zona Franca

To guarantee the accessibility of people with reduced mobility

in metro and railway

HOUSING 18% growth to face housing emergency and

to avoid residential exclusion. In total additional +€29 m

PUBLIC TRANSPORT AND SOCIAL

PRICING Additional +€154 m are allocated for

social, sustainable, safe and efficient model of mobility

29

Budget 2017



PUBLIC SECTOR PERSONNEL, KEY FOR THE SERVICES QUALITY

Consolidated the 2016 1% of wage

increase. Contingency fund includes

resources to face future wage increases

from Central Government budget

approval

Partial recovery of the 2012 bonus

payment

+6,923 new job positions included in

the public sector budget. The large

increases are in education, health and

security and civil defense

Job positions included in the public sector budget Budget

2015

Budget

2017

Variation

2017 / 2015h

Number %

Non-university teaching staff 68,969 72,568 3,599 5.2%

Police 17,323 17,599 276 1.6%

Justice administration staff 7,777 7,813 36 0.5%

Prison staff 5,019 4,972 -47 -0.9%

Firefighters 3,225 3,324 99 3.1%

Rural agents 518 523 5 1.0%

Other public administration staff 30,925 30,884 -41 -0.1%

Personnel of public sector entities 86,899 89,895 2,996 3.4%

Tax agency of Catalonia 444 903 459 103.4%

Health staff 71,528 73,165 1,637 2.3%

Other(1) 14,927 15,827 900 6.0%

Total job positions 220,655 227,578 6,923 3.1%

(1) Financed by own resources of the entities

New call for a public job positions

2017

New Government and Public

Administration School

30

Budget 2017



Guaranteeing quality provision of general public services

31

Security and

emergencies

Support to local

governments

Justice and prison

service

Culture

• Firefighters strategic plan 2017-2020

• New public offers of firefighters

positions and Catalan police

• Counterterrorism specific operational

programme

• Road safety plan

• Judicial facilities director plan

• New judicial office

• Penitentiary facilities plan

• Alternative penal measures

• E-justícia

• GovernsLocals.cat to define how the

future local administration will be

• The region of Moianès incorporated in

the Local Cooperation Fund

• Financing improvement for the Consel

Generau Val d’Aran

• Neighbourhood Law programme

• Large cultural facilities programme

• Cultural heritage programme

• Catalan language promotion programme

• Comprehensive plan of visual arts which seeks to

reactivate the National Art Fund of Generalitat de

Catalunya

• To maintain the campaign “You are 6 years old.

Choose a book”

Draft

Budget 2017



SUPPORTING SUSTAINABLE ECONOMIC GROWTH AND QUALITY EMPLOYMENT

National Industry Agreement

Foundations for a solid economic recovery

Competitiveness of the tourism sector

The higher collection of the tax allows intensify

the policy

Creative Catalunya

Supporting the promotion of professional

projects abroad on the cultural sphere

€57.4 m for the modernization of the

agricultural and fishing infrastructures

+ €98.6 m more for employability

programmes

Territorial model deployment for employment

policies agreements

Promoting an agreement with social and

economic agents to adopt a minimum wage

To consolidate youth guarantee programme

Promotion of social and cooperative

economy

Quality infrastructures and environmentally-

friendly growth

€145 m in road maintenance

+€20 m in water cycle investments and +€21 m for waste recovery and prevention improvement

+€16 m for infrastructures in telecommunications

+€5 m more in logistic infrastructures investments

+€23 m for protection, prevention and control of

natural environment and biodiversity

Electric Vehicles Recharging Investment Plan

(PIRVEC)

National pact for the energy transition of

Catalunya, period 2030-2050 (PROENCAT)

Toll discounts linked to efficient behaviors

Research, development and

innovation

+€21 m more for ACCIO

20 M€ of technological transfers to

Eurecat, reference center on industrial

innovation in Catalunya, and the

TECNIO agents.

+€12 m to promote research

Improvement of ICREA programme,

calls financed by European funding and

research activities of IRTA.

RIS3CAT strategy and ERDF funding

€660 m financial support to

businesses through the ICF

• Loans (488 EUR millions),

• Guarantees (155 EUR millions, in

collaboration with AVALIS from

Catalunya),

• Venture capital investment (17 EUR

millions).

32

Budget 2017



RECOVENING CAPITAL EXPENDITURES (INVESTMENT), BUT SLOWLY THAN DESIRED

€1,575m Capital expenditures 2017

The level of capital expenditures is rslowly

in accordance with the fiscal situation

€1,031.9m

Endowment for deferred payment methods

in 2017

33 Imports in million of euros

Budget 2017



INSTITUTIONAL DEVELOPMENT AT THE SERVICE OF CITIZENS

Democratic quality and

public participation

€57.4 m budget increase It includes the fees expenses from the settlement office

903 job positions 459 additional positions

Total assumption of the Statute’s fiscal competences

Tax collection after the voluntary payment period finalization

Direct management of assigned taxes

More deployment in the territory

19 own offices

15 new own offices added to the 4 provincial ones

11 service points shared with other administrations

Foreign action

• The foreign sector is the key for economic and

social development of Catalonia

• 14 foreign offices

• +€8.8 m for development cooperation

Catalan tax administration Deployment of the Catalan Tax Agency (ATC)

• Promoting public participation

• Implementing electronic vote

• Ready to decide

34

Budget 2017



TRANSPARENCY AND A PERFORMING GOVERNMENT TO MAXIMIZE SOCIAL VALUE

Increased transparency

and dissemination of budget

information

New graphical and navigable budget

tools, improved budget execution

information and open data

Boosting the evaluation

of public policies

Expenditure Review in strategic and efficiency

terms

Relevance of use of evidence at decision

making and budget resources allocation

processes

Goal: Review all policy areas in the next

4 years

Assuring public

resources being

properly spent and

providing the desired

outcomes

Moving to an Open

Government system in

order to promote

citizen’s participation

and involvement

35

Effectiveness in

revenue collection Fiscal fraud prevention plan 2015-2018

Budget 2017



36

Equal opportunities, equity and

reduction of inequalities

Quality public services

Economic growth: R+D+I,

infrastructures and productive

sectors

Transparency, evaluation and

institutional development

Preparing the future Catalonia Social cohesion, balanced growth, quality

public services and institutional development

Budget 2017



COMPOSITION OF REVENUES AND EXPENDITURES 3

37

Budget 2017



BUDGET INSTITUTIONAL PERIMETERS

Generalitat

(1 entity)

It includes departments

and non-departmental

funds

Administrative

Public Sector (21 entities)

It includes Generalitat,

Catalan Healthcare Service

and autonomous

administrative entities

PA-ESA Sector

(174 entities)

Includes Generalitat and all the entities

classified as Public Administration

according to ESA regulations except

public universities (Includes those in

which Generalitat does no have a

majority stake)

€25,292 m €25,361 m

Public Sector

(182 entities )

It includes Generalitat, Catalan

Healthcare Service, autonomous

administrative entities and 161

entities with majority shareholding

€28,310 m €27,813 m

Note: chapters 1 to 8. It doesn't include Local governments share of Central Government’s revenue neither European Agricultural Guarantee Fund (EAGF). 38

Budget 2017



Entities included in the budget

Subsector Public sector

entities PA-ESA sector

Total entities

included in the

budget

Generalitat 1 1 1

Autonomous administrative entities and Catalan

Healthcare Service 20 20 20

Total administrative public sector entities 21 21 21

Autonomous commercial and financial entities 2 0 2

Public law companies 44 41 44

Trading companies 27 16 27

Consortiums 54 47 54

Foundations 34 30 34

Total majority shareholding entities 182 155 182

Autonomous administrative entities -- 1 1

Trading companies -- -- --

Consortiums (2) -- 12 14

Foundations -- 6 6

Total other entities non-majority shareholding -- 19 21

Total entities -- 174 203

85% of public sector entities are

classified in the PA-ESA Sector

(2) Law 40/2015

39

Budget 2017



Evolution of entities included in the budget

2011 2012 2014 2015 2017

Generalitat 1 1 1 1 1

CatSalut, ICS, i ICASS 3 3 3 - -

Autonomous administrative entities and Catalan

Healthcare Service 25 23 19 20 20

Autonomous commercial and financial entities 5 3 2 2 2

Public law companies 46 47 43 44 44

Trading companies 52 47 30 26 27

Consortiums 62 61 50 50 54

Foundations 46 43 35 37 34

Total public sector entities 240 228 183 180 182

Total other entities non-majority shareholding 28 26 26 24 19

Consortium non-majority shareholding2 - - - - 2

Total entities 268 254 209 204 203

Since 2011 the number of public

sector entities has been reduced by

25%

40

(2) Law 40/2015

Budget 2017



Revenue budget by chapters (economic classification) of Generalitat de Catalunya

(3) Chapter 9 for refinancing is excluded: €5.290m (2015) and €5.195m (2017)

Chapter Budget

2015 1

Budget

2017

Var. 2017/2015h

M€ %

1. Direct taxes 8,766 9,630 865 9.9

2. Indirect taxes 9,382 10,912 1,530 16.3

3. Fees, sales and other revenue 523 608 85 16.3

4. Current transfers (2) 1,789 2,235 447 25.0

5. Property revenue 274 41 -233 -84.9

Current revenue (2) 20,733 23,427 2,694 13.0

6. Real investments disposal 100 0 -100 -100.0

7. Capital transfers 796 71 -725 -91.1

Capital revenue 896 71 -825 -92.1

Non-financial revenue (2) 21,629 23,498 1,869 8.6

8. Financial assets 93 83 -10 -11.0

Total revenue 1 to 8 (2) 21,723 23,581 1,858 8.6

Financial liabilities (repayment of debt excluded)(3) 2,312 1,711 -602 -26.0

Total revenue 1 to 9 (repayment of debt

excluded) (3)(2) 24,035 25,292 1,257 5.2

Current revenues increase by 13% in

2 years due to taxes and also current

transfers

Capital revenues declines because

2015 budget includes 3rd provision of

Statue of Autonomy of Catalonia

Generalitat

41



(2) It doesn't include Local governments share of Central Government’s revenue neither European Agricultural Guarantee Fund (EAGF).

Budget 2017



Chapter Budget

2015 1

Budget

2017

Var. 2017/2015h

M€ %

1. Employee compensation 5,112 5,592 480 9.4

2. Current expend. on goods and services(2) 1,891 2,189 298 15.8

3. Interests and financial fees 1,713 799 -914 -53.3

4. Current transfers (2) 13,459 14,574 1,116 8.3

5. Contingency fund 200 330 130 65.0

Current expenditures (2) 22,375 23,485 1,110 5.0

6. Real investments 404 447 43 10.6

7. Capital transfers 588 647 59 10.0

Capital expenditures 992 1,094 102 10.3

Non-financial expenditures (2) 23,367 24,579 1,212 5.2

8. Financial assets 667 712 45 6.7

Total expenditures chapters 1 a 8 (2) 24,035 25,292 1,257 5.2

Expenditure budget by chapters (economic classification) of Generalitat de Catalunya

Current expenditures increases 5%

but the reduction of interest

payments allows higher increase in

other chapters

Capital expenditure increases 10.3%

and financial assets 6.7%

Generalitat




Budget 2017


Government of Catalonia Department/sections

Budget

2015 1

Budget

2017

Var. 2017/2015h

M€ Distrib.%

Presidency 404 412 8 0.4

Vicepresidency and of the Economy and Finance 138 197 59 2.9

Transparency and Foreign and Inst. Relations and Affairs 34 64 30 1.5

Governance, Public Administrations and Housing 394 429 35 1.7

Education 4,443 4,821 378 18.9

Health 8,399 8,807 408 20.3

Home Affairs 1,161 1,246 85 4.3

Territory and Sustainability 1,472 1,669 197 9.8

Culture 239 261 22 1.1

Justice 917 951 34 1.7

Labour, Social Affairs and Families 2,593 2,872 279 13.9

Business and Knowledge 1,231 1,370 139 6.9

Agriculture, Livestock, Fisheries and Food 304 635 331 16.5

Subtotal departments 21,729 23,735 2,006 100.0

Contingency fund 200 330 130

Other non-departmental funds 3,471 3,889 418

Higher bodies 80 82 2

Debt (interest) 1,713 799 -914

Total (2) 27,193 28,835 1,642

Total expenditure without interest 25,480 28,036 2,556

Expenditure budget by departments of Generalitat de Catalunya

43

Agriculture, Livestock, Fisheries and

Food includes de EAGF in draft

budget for the first time (€275m)

Education and Business and

Knowledge departments include

educational grants ear-marked

revenue for the first time

(€50m and €80m respectively)

Generalitat



(2) It includes Local governments share of Central Government’s revenue neither European Agricultural Guarantee Fund (EAGF).

Budget 2017



Revenue budget by chapters of Generalitat de Catalunya Administrative Public Sector

Chapter Budget

2015 1

Budget

2017

Var. 2017/2015h

M€ %

1. Direct taxes 8,766 9,630 865 9.9

2. Indirect taxes 9,382 10,912 1,530 16.3

3. Fees, sales and other revenue 627 718 92 14.7



Current revenue (2) 20,804 23,496 2,692 12.9



Capital revenue 896 71 -825 -92.1



Total revenue 1 to 8 (2) 21,794 23,650 1,857 8.5

Financial liabilities (repayment of debt

excluded)(3) 2,312 1,711 -602 -26.0


excluded) (3)(2) 24,106 25,361 1,255 5.2

The current revenues increases by

12.9%

Capital revenues increase by 8.5%

Administrative

Public Sector

44 (3) Chapter 9 endowment is excluded: €5.290m (2015) and €5.195m (2017)




Budget 2017



Chapter Budget

2015 1

Budget

2017

Var. 2017/2015h

M€ %


2. Current expend. on goods and services(2) 6,413 7,112 699 10.9

3. Interests and financial fees 1,713 799 -914 -53.3




6. Real investments 513 567 54 10.5


Capital 1,000 1,100 99 9.9

Non-financial expenditures2) 23,438 24,648 1,210 5.2

8. Financial assets 668 713 45 6.7

Total expenditures chapters 1 to 8 (2) 24,106 25,361 1,255 5.2

Expenditure budget by chapters of Generalitat de Catalunya Administrative Public Sector

The reduction of interest payments

allows higher increase in other

chapters

Capital expenditures start to recover

their past level

Administrative

Public Sector

45




Budget 2017



Revenue budget by chapters of Generalitat de Catalunya Public Sector

Chapter Budget

2015 1

Budget

2017

Var. 2017/2015h

M€ %

1. Direct taxes 8,766 9,630 864 9.9

2. Indirect taxes 9,382 10,912 1,530 16.3

3. Fees, sales and other revenue 2,555 2,805 250 9.8



Current revenue (2) 23,729 26,450 2,721 11.35



Capital revenue 1,073 166 -907 -84.5



Total revenue 1 to 8 (2) 25,730 27,373 1,643 6.4


excluded)(3) 1,586 937 -649 -40.9


excluded) (3)(2) 27,317 28,310 993 3.6

Current revenues increase by 11.3%

in 2 years

Capital revenues decrease because

2015 budget included 3rd AP Statute

of autonomy of Catalunya and sales

of real assets.

Public sector

46 (3) Chapter 9 endowment is excluded: 6.468M€ (2015) and 6.208M€ (2017)




Budget 2017



Chapter Budget

2015 1

Budget

2017

Var. 2017/2015h

M€ %


2. Current expend. On goods and services(2) 7,846 8,298 451 5.8

3. Interests and financial fees 2,055 994 -1,061 -51.6




6. Real investments 1,170 1,058 -112 -9.6


Capital expenditures 1,610 1,580 -30 -1.9


8. Financial assets (3) 596 496 -100 -16.7

Total expenditures chapters 1 to 8 (2) 27,317 28,310 994 3.6

Expenditure budget by chapters of Generalitat de Catalunya Public Sector

Current expenditures growth is

lower than in Generalitat’s Budget

Capital expenditure decreases, but by

excluding payments of deferred

investments would show a net

increase

47

Public sector




Budget 2017



Public Sector Budget of Generalitat Calatunya by policies (chapters 1 to 8 including earmarked and own resources from entities, but not including PIE and FEAGA)

48

Public sector

Budget 2017



Revenue budget by chapters of Generalitat of Catalunya PA-ESA sector

Chapter Budget

2015 1

Budget

2017

Var. 2017/2015h

M€ %

1. Direct taxes 8,766 9,630 865 9.9

2. Indirect taxes 9,382 10,912 1,530 16.3

3. Fees, sales and other revenue 2,450 2,652 202 8.3


5. Property revenues 625 171 -454 -72.7

Current revenue (2) 23,595 26,284 2,691 11.4



Capital revenue 1,084 174 -910 -83.9



Total revenue 1 to 8 (2) 24,837 26,554 1,717 6.9


excluded)(3) 2,013 1,259 -754 -37.5


excluded) (3)(2) 26,850 27,813 963 3.6

In the PA ESA sector there is also a

high growth of current revenues

although it is a biannual fee

The reduction in net debt reflects the

trend towards the balance in this

sector which it is relevant for the

purpose of budgetary stability

regulations

1) According to new distribution of responsibilities

2) It doesn't include Local governments share of Central Government’s revenue neither European Agricultural Guarantee Fund (EAGF).

3) Chapter 9 endowment is excluded: 6.038 M€ (2015) and 5.743M€ (2017)

PA-ESA sector (Public administration

according to ESA rules)

49

Imports in millions of euros

Budget 2017



Chapter Budget

2015 1

Budget

2017

Var. 2017/2015h

M€ %


2. Current expend. On goods and services(2) 7,753 8,16 463 6

3. Interests and financial fees 2,037 979 -1,058 -51.9


5. Contingency fund 200 330 130 65


6. Real investments 1,174 1,059 -115 -9.8


Capital expenditures 1,630 1,565 -64.8 -4.0


8. Financial assets (3) 182 100 -82 -44.9

Total expenditures chapters 1 to 8 (2) 26,850 27,813 963 3.6

Expenditure budget by chapters of Generalitat of Catalunya PA-ESA sector

Staff costs increase by 7.1% and

current transfers increase by 15.8%

Capital expenditures are slightly

reducing but they would increase if

payments of capital works already

executed are excluded



(3) Contributions of capital for public sector entities, granting loans and acquisition of other financial assets. 50

Imports in million euros

PA-ESA sector (Public administration

according to ESA rules)

Budget 2017



Budget

2017

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