Countdown to a unique half-hearted funding: ERC on the path to another failure

The Ministry of Finance is finalizing the details of the new financing system for Catalonia, which will be presented this Monday at the bilateral Government-Generalitat commission. The agreement, which provides for 100% of tax collection by the Catalan Tax Agency, is part of ERC's demands to keep supporting Salvador Illa. Once this hurdle is overcome, PSC hopes to unblock negotiations with the Republicans to approve the 2026 budget.

The Socialists had committed to presenting the unique financing proposal on June 30. However, they didn't make it in time and postponed it to July 14. Government and Generalitat are now negotiating at the last minute to present the proposal and calm their partners' nerves.

The negotiations are being personally supervised by Oriol Junqueras, who has been suspicious for weeks. The corruption scandals in PSOE offered the Republicans an opportunity to apply pressure. In his meeting with President Pedro Sánchez after the Santos Cerdán scandal, Gabriel Rufián made his support conditional on meeting the unique financing schedule.

A halfway Catalan quota

It seems that the Socialists will make it in time to present the agreement at the last minute, this Monday. However, its content is far from fulfilling what was agreed between PSC and ERC in exchange for Salvador Illa's investiture. In other words, Esquerra is heading for another failure.

According to El Español, the new system will allow Generalitat to collect personal income tax (IRPF) but not manage or settle the tax. The collection route will change (from the State to Generalitat), but not the distribution among autonomous communities. It also doesn't guarantee the financial sovereignty ERC aimed for in the investiture agreement.

Catalan officials will collect the money to send it to the State, which will then distribute it among the autonomous communities. This is very different from the Basque quota, for example, which does manage the taxes it collects. Now, it remains to be seen how Esquerra will react to the announcement.

Another failure of processism

What exists right now within the Republican ranks is a great deal of skepticism. From the beginning, negotiations for unique financing have been a headache, with constant delays in the schedule and failures to meet commitments. ERC values the Government's effort to convince the rest of the territories positively, but they insist it's not enough.

The current political context has forced the Socialists to step on the accelerator with no real room for a more ambitious agreement. Their intention is to present a preliminary agreement this Monday, from which to continue negotiating. This way, they show that PSC keeps its commitments while continuing to drag things out.

Once again, the way processism operates is shown. This consists of making big agreements to generate big headlines, knowing they can't be fulfilled or only partially. Then, blame the central Government for the deception and play the victim.

This strategy is perfect for PSOE, because President Pedro Sánchez can keep buying time in a very delicate situation. The Socialists know that as long as they have important issues open, their Catalan pro-separatism partners won't risk letting themselves fall. Although of all the fiascos, the unique financing one is on track to take the cake.