Editorial:
The rivalry between Pablo Casado and Pedro Sánchez is showing a clear winner. While Pablo was in Brussels last week bearding an uncomfortable Angela Merkel about how Spain is going to the dogs, Pedro had reached out to Pablo’s bitterest rival from the recent leadership battle within the Partido Popular, Soraya Saénz de Santamaría, ex-President Mariano Rajoy’s right hand and the ex Vice-president of Spain (yes, 'the poisonous dwarf'), to join the Council of State - the supreme consultative organ for the Government..
Furthermore, Sánchez offered in person the position for Santamaría without consulting her erstwhile teammate Casado.
The exvicepresidenta of the Government decided to accept the offer after a few days of reflection following the phone call of Sánchez.
The Pablo Casado plan nevertheless continues in trying to hamstring the PSOE ‘okupa’ Government at every turn.
But now, it’s going too far. Pedro Sánchez was speaking about Brexit in a full session of parliament on Wednesday, noting the loss to the European Union (and the hard times ahead for the UK) and, with a glance towards the Catalonian nationalist party-members in the Cortes, he made the obvious but telling point that united means stronger.
But then, in the reply from the Leader of the Opposition, the soon-to-be ex-leader of the Partido Popular (re our forecast from August) Pablo Casado said that the Spanish president Pedro Sánchez was a golpista, a traitor to Spain because of his handling of the Catalonia crisis. An angry Pedro Sánchez answered with: ‘If you don't withdraw your remark that I'm a golpista you and I will never have anything more to say to you’.
The spokesperson for the ERC, the Catalonian Republican Left party, Joan Tardà, said in his presentation that if Casado had his way, ‘we would all be shot’.
Housing:
‘You might think that Spain has always been a popular destination for property investors, but has Brexit meant that the Brits are now choosing to stay at home? Sun, sea and sangria is a popular combination for the British and for years we have flocked to the Spanish shores not only for holidays, but also for property. Whether it is a holiday home, a complete relocation or simply an investment, many homes in Spain have been snapped up by the British. However, since the decision to leave the European Union was made, many markets have been in a state of limbo as they wait to find out what the effects will be. It would be easy to think that Spain would have felt the force of that too, but it seems that the opposite is true...’. Item from Property Investor Today here.
From Murcia Today here: ‘Confusion surrounds property sales in Spain following Supreme Court mortgage ruling’ (see ‘Finance’ below).
Finance:
A massive judicial cock-up began on Thursday last week. The story began happily enough. ‘The Supreme Court gave joy to thousands of Almerians today while flooding with sadness the banks and savings banks that operate in the province. The highest court has issued a new ruling in which it states that it is the financial entities that must pay the Tax on Documented Legal Acts (AJD) in the public deeds of the mortgage loans and not the clients.’ A piece of hyperbole from La Voz de Almería here.
Friday: ‘Spain’s Supreme Court Flip-Flops on Mortgage Ruling After Just One Day Amid Bank Stocks Bloodbath, Legal Shit-storm Erupts. The now suspended ruling would have cost the banks billions in legal costs, compensation, and reduced margins’. The story from Wolf Street here. ‘...That was fast: Spain’s Supreme Court on Friday flip-flopped on its own ruling announced on Thursday that had sent bank stocks plunging...’.
‘"Unheard of". This has been the retort that Defence Minister Margarita Robles used this Tuesday in a television interview to qualify the decision of the president of the Third Chamber of the Supreme Court, Luis María Díez-Picazo, to appeal to the Plenary of the Chamber the ruling on the mortgage tax published last Thursday. Robles, who was working as a magistrate in the same Court for 12 years, has assured that she has "never" seen "anything like it", and that this decision establishes a "shadow of doubt" about the judges who sign this sentence. "I am absolutely critical and cannot share the decision at all," she said...’. From 20 Minutos here.
To put it all into context, with El Salto Diario: ‘13.4 Million People Could Demand 25,000 million euros from the Banks for the return of the Mortgage Tax’. The news-site says ‘More than one and a half million people could claim from the autonomous communities and 13.4 million directly from the bank, depending on the age of the mortgage’. So, we can easily see why the Supreme Court felt obliged to have a re-think...
The final word will come on November 5th, says El Confidencial here: ‘The tension in the Supreme Court as a result of the liquidation of the mortgage tax has already begun to heat up the plenary session which must set a definitive criterion on the issue. When there are more than 10 days left until the meeting of the 31 magistrates is held in which it will be decided, once and for all, if this tax must be paid by the bank that grants the mortgage or the borrower who receives the money, the open war in the Chamber may end up tipping the balance in favour of the client, say legal sources...’.
‘The rise of the minimum wage to 900 euros puts at risk up to 190,000 jobs’, according to BBVA Research, a think tank, and quoted in El Mundo here. The article begins benignly enough: ‘The minimum wage (SMI), the star measure with which the Government wants to force by law a rise of 22% of basic salaries in the start-up to an election year, involves a clear risk for the most vulnerable layers of the labour market, precisely those to which it aims to help. This is the other side of the "evidence" that Nadia Calviño, the Minister of Economy, underlines when recalling that when the minimum wage has increased in contexts of economic growth, "not only have no jobs been destroyed but rather they have been created"...’.
‘Hacienda is looking into possible irregularities in 1.6 million accounts that Spanish taxpayers hold abroad, and that present a total balance of up to 457,000 million euros’.
The story at El Mundo here.
Hacienda isn’t done with us yet. From El Independiente here: ‘Hacienda expects to discover up to 2,000 million euros in small business ‘Cajas B’ accounts. The Government's latest anti-fraud offensive also contemplates obtaining an additional 110 million with a better tax control over the wealthy’.
Eldiario.es says that exports from Spain to Saudi Arabia exceed 2,000 million annually.
Politics:
Congress approves those with intellectual disabilities can vote in elections. The Lower Chamber has reformed the Organic Law on the General Electoral System (LOREG) to allow suffrage for 100,000 people with intellectual disabilities, mental illness or cognitive impairment. The story from VozPópuli here (Lenox says he once saw a fellow with severe intellectual disabilities being given his envelope by his guardian during the local Mojácar elections in 2015 – nice to know that it’s now legal).
From El País here: ‘the MEP Carolina Punset has announced that she is abandoning Ciudadanos because of their move towards "ultraliberal policies" (i.e, its move to the right)’.
Meanwhile, the emerging hard-right Vox party says it will attend the Ciudadanos meeting (who don’t seem all that pleased) in Alsasua (Navarra) on November 4th. Another article (both from El Español here and here) says that while the PP wants to absorb Vox supporters, Ciudadanos would rather ignore them.
From LaSexta TV here – ‘A study claims the State would earn 3,312 million euros a year if cannabis were to be legalized’. Well, there’s a thought! ‘If cannabis use were legalized in Spain, 101,569 jobs would be regularized, according to the study...’.
‘The lie as a political strategy’. Cuarto Poder looks at the tactics of political invention used by the Partido Popular here.
Catalonia:
‘Pedro Sanchez Urges the Independence Parties To "Take Note of the Historic Mistake of Brexit"’, says El Mundo here.
‘One of Catalonia’s nine jailed pro-independence leaders is calling for international mediation to break the deadlock with Spain. Jordi Cuixart, President of Òmnium Cultural, who has spent the past year locked up awaiting trial, says despite calls from foreign politicians and human rights groups, no progress seems possible with the Spanish government...’. More at The National (Scotland) here. The Government is now looking at lowering the charges towards the accused separatist politicians from ‘rebellion’ to ‘sedition’.
Matthew Bennett at The Local writes a somewhat skewed piece on the recent meeting between Oriol Junqueras and Pablo Iglesias – ‘Why the future of Spain's PM is being decided in a makeshift office behind bars in Catalonia’.
Andalucía:
The PP and Ciudadanos have mutually agreed to drop their demand that ‘the most voted list governs’, with the growing possibility of a bilateral agreement in the Andalusian elections of December 2nd. Eldiario.es has its fun here.
From El Huff Post comes, ‘Why do the Andalusians always vote for the PSOE?’ the answer, according to this, is because of ‘a demographic composition favourable to the left.’
We read ‘...The political scientist Pablo Simón replies: "they win because they are voted for, that’s where we have to start". He points to a series of factors: "Due to its socio-demographic composition, Andalucía is a more favourable environment for left-wing parties". In particular, the PSOE-A targets medium-sized cities, where the highest levels of unemployment and inequality are to be found. "This is key," he says. But he adds another of the most important elements: the Andalusian PSOE has been able to construct a narrative throughout these decades in order to relate the "identity of Andalusians" with socialism. "Hence Susana Díaz's idea of generating an Andalusian accent to these elections, which helps her because it is understood that the PSOE-A is the champion of regional interests...’. At BoT, we think it is down to the system of obligation, where too many people have a personal interest in keeping the status quo...
Gibraltar:
From The Olive Press here: ‘Spain will not block any final Brexit deal over Gibraltar’s future, Prime Minister Pedro Sánchez confirms. “Gibraltar will no longer be a problem in arriving at a Brexit deal,” said the Spanish leader at the EU leaders’ summit in Brussels last week, where he spoke with Britain’s Prime Minister Theresa May. Sánchez added: “If we reach an agreement (soon), great. If not, it doesn’t matter because we’ve got time to reach one.”...’.
Corruption:
From The Local here: ‘He may be behind bars, but a former police chief still strikes fear into the highest levels of the Spanish state thanks to his covert recordings of compromising conversations with the all-powerful. Spain's socialist justice minister Dolores Delgado is the latest high-profile personality to be embarrassed by leaked recordings of a past conversation with the "blackmailer," as Jose Manuel Villarejo is now known. The monarchy also recently saw red after Corinna zu Sayn-Wittgenstein, former mistress of ex-King Juan Carlos I, allegedly revealed that he used her name and that of a cousin to hide property in Morocco and Swiss bank accounts, according to another leak. The 67-year-old retired police superintendent is suspected of large-scale corruption, having allegedly done dirty work, such as blackmail or threats, on behalf of companies or rich individuals for decades...’.
El Plural considers the use of public funds spent by politicians on vice and concludes that the PP is worse here.
From a watchdog called Pension Life: ‘Costa Scam – the cost of ‘advice’ in Spain: Sadly, Spain – the leading British expat destination in Europe – is rife with scams and scammers. The Costa Blanca, Costa del Sol, Costa Brava and everything in between are crawling with what the Spanish regulator calls “chiringuitos” – literally “bar flies”. And you can see why: wherever there is food – whether fresh or rotting – they congregate in large swarms. They are not proud – they will nibble your chips while still on your fork; sip your sangria off your straw; suck the sweat off your shirt and crawl into your underpants to see if there is anything tasty in there...’. *The article ends with this: ‘I am often asked the question: “are there any firms you can recommend which won’t rip me off?” The answer to this question is a resounding “maybe”. There are a few I can categorically recommend against: Callaghan Financial Services – unregulated. Blevins Franks – unscrupulous, Blacktower – unspeakable, Abbey Wealth – unregulated and unscrupulous, Seagate Wealth – unmentionable.
From El País in English: ‘Spanish High Court probes 23 years of bribery in arms sales to Saudi Arabia. The State-owned company Defex is accused of paying millions in illegal commission to secure weapons contracts’. Here.
‘Transparency International awards the 2018 Anti-Corruption Award to the Gürtel whistleblower Ana Garrido’. 20 Minutos has the story here.
The thirteen mafias who run Marbella (the photo says it all). El Español here.
Brexit:
Speaking on Wednesday to a full parliament, ‘Spain’s Pedro Sánchez says Brexit is an ‘historic error’. The story from Politico here. ‘Brexit is a tragedy for the British and for the Europeans.’ He said. ‘Brexit is a “historic error that will diminish the influence and prosperity of the British people.” Updating lawmakers on the EU’s October summit, Sánchez said that in the event of a no-deal Brexit, Spain will need to implement emergency measures to deal with the fallout. The PM also underlined that Brexit is especially significant for Spain because it “has a direct impact on each and every corner” of the country, citing the situation of Spaniards who live in the U.K., the fishing industry in northern Spain, tourism and other businesses that are interlinked with Britain...’. He also mentioned ‘the 300,000’ Britons living in Spain, without advancing any plans for them.
‘British residents in Spain live with uncertainty over the negotiations of the Brexit between the Government of the United Kingdom and the EU, and in particular the long and agonising wait for any information, says the president of Brexpats in Spain, Anne Hernández. The association, which was formed in a Facebook group in the Málaga municipality of Mijas, emerged after the referendum held in the United Kingdom in 2016 to provide a professional response to the doubts of residents in the area, and has spread nationally due to demand to now exceed 5,500 members. The group says it is apolitical and is neither for nor against the Brexit, as "the result will affect everyone equally" in relation to residents abroad, and the extension of the negotiation period agreed between the EU-27 and the British Prime Minister, Theresa May, this week has only contributed to further add to the "uncertainty".
"The only certainty is uncertainty, we don't know anything", replied this British woman who has been living in Spain for more than 32 years. "We don't want to leave here, our home is here, our family, our property, we don't want to change it", she remarked. Many are the doubts held by the British residents, so Hernandez also sees the need to create a figure to represent British residents in Spain in the European Union and to bring their concerns to the UK Government, since the Consulate and Embassy are merely administrative bodies.
"After 27 months we know nothing, we are in limbo and this uncertainty is unbearable," says the president of Brexpats in Spain, who complains that the British living abroad have no voice and are forgotten by their country. One of the main concerns is the right to vote, since non-European citizens "do not have the right to vote in European or municipal elections" in Spain. Nor does the United Kingdom allow those who have been abroad for more than 15 years to vote while Spain "does not allow" dual nationality with this country.
Access to Spanish public healthcare is another of their headaches, as there is currently a bilateral agreement between the two countries whereby the United Kingdom pays an amount per patient, which could well not remain in force after the rupture. In this sense, the British residents fear losing access to healthcare and being forced to "pay for private insurance, which will be more difficult for those over 70 or with chronic treatments".
Also of worry are the possible freezing of pensions; the freedom of movement, which would make it difficult to visit relatives; the possible closure of the border with Gibraltar, the difficulties that the Brexit can generate in imports and exports and even the periodic renewal of driving licences, she said. The transfer of pets is another issue, as the United Kingdom force pet-owners to "isolate the animal for six months" in an official kennel to prevent infections; or the financial issue, as nobody knows whether they will be able to continue bank-transfers or to withdraw money from British banks from abroad.
According to data handled by the association, there currently legally reside in Spain over 300,000 British citizens, of which one third are pensioners, living generally speaking on the Costa del Sol, in Alicante, the Canary Islands, the Balearic Islands, Andalucía, Valencia and the Costa Brava’. The report comes from Canarias en Hora here.
From Lenox’ blog: ‘It's Getting Tight (Can we vote in May next year or not, pretty please?) here. And in castellano here.
Finland isn’t Spain, but ‘Interior Minister: No guarantees for Brits in Finland if Brexit deal fails. As crucial Brexit talks get underway in Brussels, Minister Kai Mykkänen admits he hasn't worked out what to do with 5000 UK nationals already living in Finland’. The story from News Now Finland here.
The Housing Sector: Summary
By Andrew Brociner
To summarize the analysis on the housing market, there have been rises in sales in the past year in quite a few provinces. This rise in sales, however, has not necessarily translated into an increase in prices in some regions. There are many discrepancies in price, with some regions, such as Madrid and Barcelona, responsible for a large part of the increase which affects the overall average, while some other regions have not shown any increase at all. We can note too that the increase is largely due to second-hand houses which are only now filtering through to increased total sales as the decreasing demand for new houses has stabilised at a very low level.
The demand for second-hand houses rather than new ones also implies that the stock of new houses is still very large. This is one of the reasons which has prevented prices from reflecting the rise in sales. This stock is mainly around the coast and in Madrid, but when we compared the new stock to total stock, we found that the areas which had large new stocks but had a small new stock to total stock ratio were those where prices were more able to rise, such as Madrid, Barcelona and the Baleares.
If we look at some demand components, we see that the number of new households set up has increased somewhat after many years of decline. The population of Spain is also rising after having decreased, but only very slightly. Underpinning some of this movement, the fertility rate which had risen from 1.2 before the boom to a peak of 1.45, decreased afterwards; however, recently, there has been an increase again to about 1.34. This is due to the unemployment rate being lowered gradually. Nevertheless, Spain’s fertility rate continues to be one of the lowest in Europe, along with Greece, Portugal and Italy. Therefore, a rise in population is not likely to come from this source alone. What has been contributing to the increase is a rise in immigration. While emigration has also risen, immigration has recently increased by more contributing to a net positive effect.
There have been signs of changes recently, such as an increase in sales, at least for second-hand houses, and an increase in price, at least for some regions, but the results are still heterogeneous and tentative. While there has been a small rise in new households set up, and a slight increase in population, together with a rise in fertility and immigration, we have to continue to see if these will be sustained. It is certainly the beginning after many years of decline and consolidation, but some more time will be needed to see if this continues.
Ecology:
‘The Congress of Deputies last week validated a new initiative for the ‘transition of energy and the protection of the consumer’ that, among other things, repeals the so-called Sun-tax and opens the door to refunds and payments from the electric companies for surplice energy. All the parties except PP, Ciudadanos and Foro Asturias, the party founded by Francisco Álvarez Cascos, have voted in favour of the new rule. Energías Renovables has the story here.
‘A Málaga town has set a national record for the highest amount of rainfall in 12 hours. Alpandeire, in the Serranía de Ronda, saw 399.4 litres of rainfall per square metre from midnight on Saturday until 12pm Sunday. Bobadilla saw the second-highest amount with 247.6, followed by Ronda with 220.4...’. Item from The Olive Press here.
Various:
‘Fruit, veg and family life – why Spaniards are living longer. ... According to a study published this week by the Institute for Health Metrics and Evaluation in Seattle, people in Spain will have an average lifespan of 85.8 years by 2040, while those in Japan will lag ever so slightly behind on 85.7 years...’ Item from The Guardian here.
We have read enough (never enough) about the poor Venezuelans, but where do the wealthy ones normally live? Why, according to El Cooperante, in the most exclusive part of Madrid, the Barrio de Salamanca.
Many Spanish nurses are choosing to abandon the UK, says The Local here. ‘Spain represents the second highest number of NHS nurses from the EU behind Ireland, but many workers have decided to leave Britain after it decided in a 2016 referendum to leave the bloc. NHS Spanish staff has decreased from 7,240 to 6,160 -- a fall of 15 percent -- since June 2016, the only EU nationality that has recorded a fall, according to a parliamentary report published this month. Spaniards can currently accrue points from their work in Britain that can later be used on Spain's public health job exchange. But "we fear that after Brexit this will not continue and that has caused many people to stop coming and others have decided to leave," said Gala...’. .
‘The Bosnians who speak medieval Spanish. When Jews fled Spain during the Inquisition, they carried their language with them. Today, Ladino reflects the trajectories of the Sephardic Jewish diaspora, but can it survive?’. From The BBC here (Thanks David).
From Piccavey here: ‘As Todos los Santos is a commemoration of the dead, most Spanish families head to the cemetery on November 1st (or that weekend) to place flowers on tombs, clean the gravestone or nicho (most Spanish burials are in wall niches) and remember their deceased family members’. It’s also the time for Halloween, which is entering into the Spanish pantheon of (commercial) festivals.
Letters:
Lenox,
You wrote "new ambassador of HIS Majesty the Queen"!
Off to the Tower for you next time in UK!
Iain
Whoops! Lenox
Read your article about the new budget proposals. The one that grabs us most is the idea of a graduated social security contribution. Spain must be just about the only country in the EC with a fixed contribution for self-employed people. It causes tremendous problems for the craft people who populate our craft fairs. Many of them manage to survive on a turnover of €200 or €250 a week and out of that they must, somehow or other, keep their ancient vans going and buy materials. It often leaves them with an income - on which to live - of €170 to €220 a week clear. How are they going to pay the odd €75 a week to seg. soc.? The answer
is - they don't. They just hope that they or their children don't get ill in the immediate future. Jan
Hi Lenox,
It all sounded too good to be true, and so it proved. It just goes to show that politicians live in another world. Have a look at
https://www.eleconomista.es/gestion-empresarial/noticias/9291749/07/18/La-tarifa-plana-universal-de-50-euros-para-autonomos-tendra-su-fin-en-2019-.html and sure enough, those earning more than the minimum wage but less than €30,000 per year will pay a mere €278,87 per month minimum, while those earning between €30,000 and €40,000 must pay €357.
Yes, it is graduated, but somebody earning €10,000 a year (common enough for artesanos) would still have to pay €3,346 per year (i.e. 33%) of his or her income. if he or she wants to do it all legally. And it is not just artesanos (that's our worry), but look at cleaners, gardeners, carers, stable girls etc.
That same article mentions the possibility of paying a flat rate of €50 per month if you're not earning more than €10,000 odd, but only for 4 years. It doesn't say so in the article but presumable after 4 years you are deemed to be earning enough to pay €278,87 per month to Seg.Soc.
I'm afraid Spain still has a long way to go to make life a little easier for the little man.
Jan
Finally:
Peret was the Catalonian gypsy singer who introduced ‘La Rumba Gitana’ to popular taste. Here he performs ‘Una Lagrima cayó en la arena’ on YouTube.
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