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COST OF LIVING

How inflation in Spain is driving working people to the ‘hunger queues’

With a secure job as a bricklayer and monthly wages of €1,200, Hugo Ramírez never thought he would need the help of charity to feed his family. But spiralling living costs in Spain mean the 44-year-old father of three has been left with no other choice.

How inflation in Spain is driving working people to the 'hunger queues'
People queue up to get food next to Aluche neighborhood association local in Madrid on November 19th 2022. (Photo by PIERRE-PHILIPPE MARCOU / AFP)

“We see prices increase every week, even for basic goods,” he told AFP as he stood before wooden crates of fruits and vegetables at the entrance of a residential building in Madrid.

Driven by the war in Ukraine, Spanish food prices jumped 15.4 percent in October from a year earlier, their biggest increase in nearly three decades, according to the National Statistics Institute.

Sugar was up 42.8 percent, fresh vegetables rose 25.7 percent and eggs 25.5 percent as staple items soared.

In a bid to ease the pressure on squeezed households, Socialist Prime Minister Pedro Sánchez’s government — which faces an election next year — has spent billions of euros on extra welfare spending.

Every Saturday Ramírez, who is from Venezuela, comes to this food bank set up by a neighbourhood association in the working-class district of Aluche during the pandemic to pick up food supplies.

He earns €1,200 a month while his wife makes €600 working part time as a domestic helper.

After paying their monthly rent of €800 and €300 for utilities “there is not much left,” he said.

Driven by the war in Ukraine, Spanish food prices jumped 15.4 percent in October from a year earlier, their biggest increase in nearly three decades, according to the National Statistics Institute. (Photo by PIERRE-PHILIPPE MARCOU / AFP)

The line of people seeking help stretched far down the street. Many of them are immigrants.

Similar lines, dubbed “hunger queues”, can be seen regularly outside of other food banks across the country.

Insufficient salaries

“Every week we see new families in need, especially since the start of the war in Ukraine” in February, said Raul Calzado, a volunteer with the Aluche neighbourhood association.

Some mothers have stopped buying feminine hygiene products to be able to feed their children, he added.

The association currently offers aid to 350 households, a number Calzado expects will rise to around 400 by the end of the year.

Behind him dozens of other volunteers are busy at work, surrounded by boxes of pasta, canned goods and baby diapers.

“Some beneficiaries have no revenues. But we also have more and more retirees with small pensions or people who work but whose salaries are insufficent,” said the association’s vice president, Elena Bermejo.

One in seven homes in Spain suffers food insecurity, meaning inadequate or insecure access to food due to low income. (Photo by PIERRE-PHILIPPE MARCOU / AFP)

Among the measures Spain has introduced are subsidies for transport, a one-off payment of €200 for the unemployed and a 15 percent increase in pensions for the most vulnerable such as widows.

But charities that work with the poor say the measures are not enough.

“For some families, even buying a litre of olive oil or a kilo of lentils has become difficult,” said Bermejo.

Donations down

Food banks, which had started to see dome relief as people returned to work after pandemic shutdowns, are struggling to meet the growing demand.

“With inflation, we are seeing a decrease in donations” since people have less money, said the spokesman for the Spanish Federation of Food Banks, Luis Miguel Rupérez.

And higher prices also mean food banks can’t afford to buy more food themselves, he added.

The federation collected 125,000 tonnes of food since January, compared to 131,000 tonnes during the same time last year.

Food banks provide help to over 186,000 people in the Madrid region, and 1.35 million in total in Spain — roughly the same population as Barcelona, the country’s second biggest city.

One household in seven in Spain suffers food insecurity, meaning inadequate or insecure access to food due to low income, according to a study published earlier this year by the University of Barcelona.

“I hope it will get better but I’m afraid that won’t be the case,” said Ramírez as he clutched a bag of groceries from the food bank.

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MONEY

What’s the maximum amount you should have in a current bank account in Spain?

Most people in Spain only have one bank account and use it for all different purposes, but what happens when you manage to save up a bit? Here's the official advice on Spanish savings accounts.

What’s the maximum amount you should have in a current bank account in Spain?

Our bank accounts are used for many day-to-day activities such as paying bills, receiving paychecks and buying groceries, but is there a maximum amount of money you should have in your account at one time? And what should you do if you go over this amount?

While there isn’t an official maximum amount that you should have in your current account, the Organisation of Users and Consumers (OCU) advises that your current account only be used for certain amounts and everything over that should be put into different accounts.

According to the OCU, in your main bank account, where you receive your salary, pension or other significant payments, you should have a maximum of three months of your salary.

So for example, if you earn the minimum wage of €1,000 per month in Spain, then the maximum you should have in your current account is €3,000.

READ ALSO – Ask the expert: What are the best UK banks for Brits in Spain?

They advise that you don’t want to go too much under this amount either because you want to make sure you have accessible cash to use when you need it, as well as for possible emergencies. They also suggest checking your account balance regularly to make sure you don’t go into the red and don’t incur extra bank fees.

But equally, you don’t want to have too much in your account and keep all your savings in one place for security reasons.

Savings accounts

The OCU recommends opening a savings account or cuenta ahorro for any amounts greater than three times your salary, rather than keeping it all together in your current account.

Most banks have various types of savings accounts with different interest rates and different fixed terms where you’ll have to keep your money in for a certain amount of time.

For money you’ll need in the short term, but not right away, the OCU suggests putting it into a fixed-rate savings account (cuenta ahorro plazo fijo) for 12 months, but warn that if you need the money before the year is out then you may have to pay fines take it out.

For money that you know you won’t need in the short term, the OCU advises putting it into a long-term investment or a fixed-rate savings account for longer than one year. “For amounts that you don’t plan on touching in the next five or ten years, it’s advisable to make a little profit on it, however, keep in mind there may be seasons in which you suffer some losses too”, they said.

Savings over €100,000

For anyone that has savings over €100,000 in any type of account, it’s important to distribute the amount over various accounts warn the OCU.

This is because during an economic collapse or bank failure, you will not be covered by the EU Deposit Guarantee Fund, which is only able to guarantee the repayment of your money up to €100,000.

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