The government of Spain today released its 2013 budget and outlined the economic reforms it will take to meet the conditions that are sure to be imposed on the country if it should seek a bailout from the European Central Bank. The budget proposals include spending cuts and tax increases to lower the country’s fiscal deficit to 4.5% of GDP. The deficit is expected to reach 6.3% in 2012.
Spending on social programs will amount to 63.5% of the country’s 2013 budget and the government will take €3 billion from its pension fund to help meet expenditures. Next year’s GDP is expected to contract by 0.5%, an amount the budget minister called “a soft recession.”
Cuts to spending will amount to 0.77% of projected GDP, while tax increases will be worth another 0.56%. Government ministries will all suffer an 8.9% cut to their budgets next year.
Street demonstrations over the past few days have highlighted public opposition to more austerity and spending cuts. And even if the government is able to put its plan into practice, there are still plenty of doubters that Spain can meet its deficit targets for either this year or next. The government really is trapped between a rock and a hard place — but it really has no other choice.
Paul Ausick
The #1 Thing to Do Before You Claim Social Security (Sponsor)
Choosing the right (or wrong) time to claim Social Security can dramatically change your retirement. So, before making one of the biggest decisions of your financial life, it’s a smart idea to get an extra set of eyes on your complete financial situation.
A financial advisor can help you decide the right Social Security option for you and your family. Finding a qualified financial advisor doesn’t have to be hard. SmartAsset’s free tool matches you with up to three financial advisors who serve your area, and you can interview your advisor matches at no cost to decide which one is right for you.
Click here to match with up to 3 financial pros who would be excited to help you optimize your Social Security outcomes.
Have questions about retirement or personal finance? Email us at [email protected]!
By emailing your questions to 24/7 Wall St., you agree to have them published anonymously on a673b.bigscoots-temp.com.
By submitting your story, you understand and agree that we may use your story, or versions of it, in all media and platforms, including via third parties.
Thank you for reading! Have some feedback for us?
Contact the 24/7 Wall St. editorial team.
Latest from 24/7
