Published on Monday, April 11, 2022

Spain | What incomes pact?

An incomes pact is necessary, though difficult to implement. It is essential that the Government should broker a wide-ranging social agreement that helps control inflation, protects the most vulnerable and is as inclusive and transparent as possible, to ensure we do not lose competitiveness and to prevent social discontent.

Key points

  • Key points:
  • We therefore welcome a temporary increase of 15% in the Minimum Living Income and the expansion of the social subsidy on electricity rates to cover 600,000 more families.
  • For the same reason, an indiscriminate subsidy on fuel consumption does not appear appropriate. Those who travel more, and longer distances, are families with higher incomes.
  • Moreover, the above measure is not consistent with the aim of reducing dependence on non-renewable sources of energy, increasing its efficient use and boosting investment in renewable energy.
  • Apart from the principle of progressivity, the incomes pact should include as many groups as possible and be the result of consensus. This would make it credible and enhance the feeling of solidarity.
  • The limitation of 2% on rent increases meets few of these conditions.

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