Thursday, 24 November 2011

Social Security close to a deficit

Pensioners (© Alberto Bullrich 2011)
SPAIN Spain's Social Security system could end the year in the red, according to an article in Expansión. The imbalance could be about between €200-and €300 million, which is 0.02% or 0.03% of the country's GDP. Should this occur, it would be the first time the system would be in the red since 1999. But the final numbers will only be known in March, 2012 - in other words, another major headache for the new PP Government under Mariano Rajoy. However, if the fact is relevant, it is also important to look at the consequences. First, it endangers the reduction of deficits in total, but especially those of the Autonomous Communities and local Councils. The plan was to end the year with a small surplus, equivalent to somewhere around 0.03% of GDP. But the economy came to a halt.

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