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Spain eases spending constraints as 'reward' following years of austerity

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Spain eases spending constraints as 'reward' following years of austerity
Photo: AFP
09:04 CEST+02:00
Spain's lower house has approved a 2016 budget designed to ease some spending restrictions after years of austerity, ahead of legislative elections due on December 20th.

The budget passed on Tuesday provides for increases of 9.3 percent for education, 3.6 percent for health and 7.6 percent for culture, as well as a rise of 0.25 percent in state pensions and a one-percent boost in pay for civil servants, who will also receive bonuses for the first time since 2010.

The conservative government of Mariano Rajoy describes the budget as a reward for five years of belt-tightening, after growth resumed last year.

It forecasts an expansion of 3.3 percent of gross domestic product (GDP) in 2015 followed by three percent in 2016.

Critics at home accuse the government of electioneering.

They say the recovery is fragile and point to major deficits in the social security and regional budgets and an explosion in government debt.

The EU's executive Commission has forecast Madrid will record a public deficit of 4.5 percent of gross domestic product (GDP) this year and 3.5 percent in 2016 - still above the three percent stipulated in the eurozone.

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