Spain’s Socialists and Podemos make pact to form new government

Spain's Socialists and the radical leftwing Podemos have agreed in principle to form a coalition government, the leaders of the two parties said on Tuesday.

Spain's Socialists and Podemos make pact to form new government
Photo: AFP

Despite months of failed negotiations between the two parties in the wake of the general election in April, forcing Sanchez to call a repeat general election, the two leaders have defied expectations and made a deal within 48 hours of the vote.

The pair signed a deal on Tuesday shortly before 2.30pm after holding secret meetings on Monday night. It will see Pedro Sanchez as Prime Minister with Pablo Iglesias take the role of Deputy Prime Minister.

 “As I said on election night after hearing the results, what was a historical opportunity in April has become a historical necessity,” said the Unidas Podemos leader.

“I’m pleased to announce today, together with Pedro Sánchez, that we have reached a preliminary agreement to create a progressive coalition government that combines the experience of the PSOE with the courage of Unidas Podemos.”

Sanchez added that the deal would form a “progressive government made up of progressive forces that are going to work for progress. There is no room for hatred between Spaniards,” he said.

He said the deal was for the government to last for four years, “the entire term”.

The two leaders hugged in front of the cameras after signing the pact.

Photo: AFP

In the coming weeks, the two parties would thrash out all the details of both the structure and the programme of the government, Sanchez added.    

The pair will need the support of other factions in order to pass an investiture vote with at least 176 votes in the 350-seat parliament.

Although Sanchez's Socialists won Sunday's vote, the fourth in as many years, he emerged from the elections weakened. The repeat vote boosted support for the rightwing People's Party and propelled the far-right Vox into third place.

Both the Socialists and Podemos lost seats compared to April's election.    

Sanchez's party took 120, down from 123, while Podemos secured 35, down from 42, leaving the two factions 21 seats short for any investiture vote.

The coalition would need the support of Ciudadanos, which won just ten seats (down from 57) as well from smaller regional parties. 

But Ciudadanos was quick to criticise and seemed to immediately rule out backing a Socialist-Podemos alliance.

“Ciudadanos cannot support Sanchez and Podemos holding the reins of Spain's government,” a party statement said, saying it would be “detrimental to the interests of most Spaniards”.

And like others, it harked back to a September interview in which Sanchez justified his decision to call an election and refusal to work with Podemos    

In it he said he wouldn't sleep at night if he formed a coalition with a party that had so “little experience of politics”.

“Not so long ago, he said he couldn't sleep with the idea of Podemos and now they're going to live together,” the party said, in remarks which were echoed by PP leader Pablo Casado.

“It no longer worries him that Pablo Iglesias will be in his government but there are many Spaniards who will be worried by this deal that they've just announced,” Casado tweeted.

Following the announcement, the Ibex 35 index of most-traded Spanish shares went into the red, and soon after was trading about 0.80 percent lower, with banking stocks particularly affected on concerns the alliance could hike taxes on the sector.


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At last! Spain passes budget in boost for minority government

Spain's Senate is poised to approve Prime Minister Pedro Sanchez's budget for 2021 later Tuesday, boosting his minority Socialist-led government after years of political instability.

At last! Spain passes budget in boost for minority government
File image of a debate in Spain's parliament. Photo: AFP

Spain's Senate approved Prime Minister Pedro Sanchez's budget for 2021 on Tuesday, boosting his minority Socialist-led government after years of political instability.

The spending plan, which channels billions of euros in European Union pandemic recovery funds into the economy, was approved by the lower house on December 3 before receiving the Senate's backing.

Its passage increases the chances that Sanchez will hold on to power until the next general election set for 2023.
   It became the first budget to be approved since 2018.   

The rise of new parties such as far-left Podemos and market-friendly Ciudadanos has fractured parliament, making it difficult to pass legislation.    

This has led to a cycle of political instability that has taken Spain, the euro zone's fourth largest economy, to four elections between 2015 and 2019.    

“This is a very, very important stage because it allows Pedro Sanchez to gain time and stability,” said Oriol Bartomeus, a political scientist at the Autonomous University of Barcelona.

'Sanchez never admits defeat'

Sanchez came to power in June 2018 but was forced to call fresh elections early last year after Catalan separatist parties voted down his draft budget.   

The budget vote came on the heels of the start of a high-profile trial of Catalan separatist leaders over Catalonia's failed 2017 bid to break away from Spain.

“Sanchez has shown throughout his career that he never admits defeat,” said Paloma Roman, politics professor at Madrid's Complutense University.    

After two inconclusive general elections in 2019, Sanchez in January 2020 formed a minority coalition government with Podemos.   

He initially tried to win support for his 2021 budget from Ciudadanos.    

But after that failed, he controversially turned to several smaller regional nationalist parties, including Bildu, the heirs of the former political wing of armed Basque separatist group ETA.

Sanchez took office in 2018 with the backing of these parties, but the pact with Bildu sparked an outcry from the right and even criticism from within his Socialist party.

Given the make-up of parliament, “there was no other possible majority” to help pass the budget, said Bartomeus.

'Not be easy'

In exchange for the support of these parties for his budget, Sanchez agreed a series of measures, including a moratorium on evictions for poor families which cabinet is set to approve on Tuesday.

While approval of the budget ensures Sanchez's government will last, he still faces “years of permanent negotiations within his government and in parliament” to approve laws, said Cristina Monge, a political scientist at the University of Zaragoza.

The Socialists and Podemos, their junior coalition partners, are divided over many issues such as migration, the future of the monarchy and the need to raise the minimum wage.

Sanchez's ties with Catalan ally ERC also risk becoming more tense as Catalonia's regional elections on February 14 nears.   

“It will not be easy for the government to resist these tensions, but neither of the two (coalition partners) has any real interest in separating” and bringing down the government, said Bartomeus.

Monge said Podemos is falling in the polls and the Socialists do not have enough support to govern alone so the “price they would pay” if they split would be “too high”.

By AFP's Mathieu Gorse