Spain prepares for more austerity as 2013 budget announced

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Spain prepares for more austerity as 2013 budget announced

Spain prepares for more austerity as 2013 budget announced
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Spain is set for further austerity as the government announces its 2013 budget on Thursday.

Prime Mininster Mariano Rajoy is expected to freeze public sector wages for a third year and possibly cut early retirement to secure 39 billion euros in additional savings.

The measures come despite protests from ordinary Spaniards warning that they’re at breaking point and scepticism from financial markets, watching from the sidelines.

On Wednesday, figures revealed that Spain’s recession was deeper than expected, forcing
European stock markets lower while Madrid’s borrowing costs headed back to dangerously high levels.

While brushing off this week’s violent protests in the capital, Rajoy appealed to what he described as the vast majority of Spain’s 47 million population, who he said are hard at work and giving their best to get the country out of the economic crisis.

But his comments have angered many protesters who have accused him of being out of touch. One in four adults are out of work and many middle class families have been plunged into poverty.

Commentators say Rajoy’s objective is to hopefully weaken the conditions attached to any expected EU bail-out for Spain.

Thursday’s budget announcement is also expected to add further pain to Spain’s arts scene. Spending on culture is down 70 percent since 2009 and a recent hike of the tax on threatre and cinema tickets from eight to 21 percent hasn’t helped.