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MONEY

Soaring energy prices push inflation in Spain up to 37-year high

Spanish inflation has surged to a near 37-year high due to sky-high energy prices following Russia's invasion of Ukraine, official data showed Wednesday, adding pressure to the government.

Soaring energy prices push inflation in Spain up to 37-year high
Inflation had already risen above 6 percent in Spain before Russia's invasion of Ukraine pushed energy prices up even further. (Photo by OSCAR DEL POZO / AFP)

The rate jumped to 9.8 percent in March from 7.6 percent in February, its highest level since May 1985, according to a preliminary estimate from national statistics institute INE.

“It is a bad figure which affects our economy, especially more vulnerable groups … due to runaway energy prices,” Socialist Prime Minister Pedro Sánchez told parliament.

Like the rest of Europe, Spain has been struggling since last year with soaring energy prices, with households and businesses struggling to pay electricity bills.

Since Russia invaded Ukraine on February 24, oil prices have spiked, and Spain’s transport and farm sectors have staged noisy protests and strikes to demand help with crippling gasoline prices.

The spike in prices in March was due to the surge in electricity and fuel prices, but also by the rise in the cost of food items due to the war, the statistics office said.

READ ALSO: The food products that are more expensive than ever in Spain

Sánchez’s government approved Tuesday plans to offer €16 billion ($17.5 billion) in direct aid and loans for companies and households hit by the impact of Russia’s invasion of Ukraine.

The measures, which will remain in place until June 30th, include a discount of 20 cents per litre of fuel, with the government paying 15 cents and fuel providers the rest.

It also includes a €362-million aid package for the agriculture and farming sector, €68 million for the fishing and aquaculture industries
and a two percent cap on rental increases.

For households, over the next three months, rent increases will be limited to a maximum of 2.0 percent.

READ MORE: EXPLAINED – The plan to lessen Ukraine war impact on Spain’s economy

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MONEY

How much can you save on public transport in Spain with the new state discount?

Spain's government recently confirmed it will slash the cost of public transport tickets to help people deal with rising inflation. Here's how much bus, train and metro tickets are likely to cost you in some of Spain's main cities from September 2022.

How much can you save on public transport in Spain with the new state discount?

Spain’s annual inflation rate reached 10.2 percent in June, the highest since April 1985, according to a statement released by the Spanish authorities on Wednesday. 

To help its citizens and residents save money and make ends meet at a time of rising inflation, the Spanish government recently announced a 50 percent discount on the cost of multi-journey tickets on RENFE services such as Cercanías, Media Distancia and Avant. 

A 30 percent discount will also be applied to the cost of passes and multi-trip tickets for regional and local transport services, including city metro, bus and tram systems, bought between September 1st and December 31st 2022.

So far it hasn’t been revealed exactly how the reduction will work and it is up to each region to decide on how they want to implement it.

For example, they could just reduce the cost of the tickets or ask people to apply for money back on the tickets they’ve bought over the four months.

Some cities and regional authorities have also said that they will reduce the cost of transport tickets further by applying an extra 20 percent discount on top of the central government’s 30 percent, taking it to 50 percent.

In order to finance the new measure, the government has confirmed that €221 million will be allocated to regional governments and transport authorities across the country. 

Here are the savings you’ll be able to make on transport tickets in Spain’s major cities:

Barcelona

The regional government of Catalonia has announced that it will aim to add further deductions by applying a total 50 percent discount for services run by the Autoritat del Transport Metropolità (ATM ), which includes Barcelona city and the metropolitan area.  

The mobility councillor for Barcelona City Council Laia Bonet said ATM is “aiming to guarantee a 50 percent reduction”. 

This means that if the 50 percent discount is applied, the T-Usual ticket, which allows you unlimited journeys over 30 days, will go from costing €40 to just €20 and the T-Casual ticket which gives you 10 journeys will go from €11.35 to €5.67.  

Madrid

Madrid has not yet confirmed if it will apply more than the 30 percent discount announced by Pedro Sánchez’s government, as public transport tickets there are already subsidised by 60 percent. Authorities in the capital have also said that they still don’t know how much of the €221 million they will receive.

If the national government’s 30 percent reduction is applied, the standard 30-day metro season ticket for zone A will be reduced from €54.60 to €38.22 and the regional pass all the way to Toledo will drop from €131.60 to €92.12.

Seville

Seville City Council also hasn’t yet decided if they will apply a 50 percent discount on transport passes to stick with the 30 percent. However, IU-Podemos has requested that they apply the 50 percent reduction. 

Currently, TUSSAM, the body responsible for urban transport in Seville, has set the price for a 30-day bus pass at €35.50.

With a 30 percent deduction, this will drop to €24.71 and with a 50 percent discount, the cost will go down to €17.65.

With regards to the Seville metro system, a 30-day Bono Plus 45 ticket which allows you to make 45 journeys of a similar type, costs between €30 and €50, depending on how many zones you jump through.

With the 30 percent reduction, a simple pass without jumping through zones will cost €21, while the one-jump pass will cost €29.40.

Valencia

As of yet, there is no concrete information on the reductions that will be applied to transport tickets in Valencia city, but based on the national government’s discount a 30-day SUMA ticket pass for the metro, bus and local train services for zones A and B will go from €35 down to €24.50.  

Málaga

Like Seville, no decision has been made yet in Malaga as to any further reductions other than the government’s 30 percent. Based on this, an unlimited monthly bus pass will be reduced from €39.95 to €27.96.

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