Unformatted text preview: review, for which provision was subsequently made with the Organic Law on
Financing the Autonomous Communities of 1979 (LOFCA), which developed Title 8 of the Constitution. Every five years
the model has been reviewed for the five subsequent years.
Over 22 years have passed since the edification of the State made up of autonomous communities. Jurisdiction has
been apportioned among the various autonomous communities and has been transferred and the role played by each
administration is now much clearer and more precise. However, the funding system has been elaborated based on the
actual cost of the services transferred and with successive adaptations and the incorporation of the modifications made
during the last two revisions, in 1991 and 1996.
The system in force until this year has partially attained its objectives and, while successive modifications have achieved
significant progress, it now displays major discrepancies and shortcomings, which imply for the autonomous
communities a limitation on their financial autonomy, economic deficiencies and an inevitable process of indebtedness.
It was, therefore, necessary to define in respect of the future model that would fairly and in an integrated manner
structure the distribution of public resources a model that grants the citizens of Catalonia what they have been
demanding for years, i.e. financial autonomy within a transparent framework of solidarity.
Allow me, before I turn to the most interesting point in the report, do give a few examples of shortcomings in the existing
♦ Communities with similar jurisdictions receive different per capita amounts of resources. ♦ The system, based on expenditure updating criteria, does not allow for all administrations to experience a positive impact
on their finances when the economy is thriving. ♦ It makes no sense for health to be separated, as is the case, from general funding. Moreover, the apportionment of
resources is not adapted to the genuine needs of the population being protected, e.g. aging, immigration, new drugs. ♦ Some opaqueness prevails with respect to solidarity in certain autonomous communities in relation to the others, with the
result that the fiscal balances of the autonomous communities are not published. ♦ The Advanced Scientific Research Centre (CSIC) has just acknowledged that Catalonia has a fiscal deficit in respect of the
State of 1 billion pesetas (US$5.5 million). ♦ The Economic Analysis Institute of the CSIC recognizes that between 1990 and 1997, Catalonia contributed, on average,
over US$5.5 million. ♦ In relative terms, this amount represents 50% of the Catalonia Government’s budget. ♦ It should be noted that, because of its specific nature, Catalonia has not received funds from the European Structural
Funds, the Inter-territorial Compensation Funds of the central government, or direct investments from the State in Chapter
6 of the budgets. ♦ We may pay taxes (capital tax) and participate in the collection of other taxes (income tax), but the central government
View Full Document