Take my advice

There is no shortage of figures and institutions queuing up to tell Sánchez and Iglesias how to go about increasing Spain's productivity and competitiveness

Mark Nayler

Friday, 7 February 2020, 18:12

Increasing, or at least maintaining, Spain's productivity and competitiveness is one challenge faced by the country's new leftist government. But even more important for the untested team comprised of Pedro Sánchez's Socialists and Pablo Iglesias' Podemos is improving the standard of living for those on low incomes and tackling soaring rental prices - part of an overarching aim to reduce Spain's socio-economic inequality. Unsurprisingly, there is no shortage of figures and institutions, both at home and abroad, queuing up to tell Sánchez and Iglesias how to go about these fiendishly complex tasks. Are they likely to be listened to?

This week saw Spain's Central Bank chief Pablo Hernández de Cos urging the Sánchez-led administration to leave Mariano Rajoy's labour market reforms well alone. Introduced by the then-Conservative prime minister in 2012, at the height of the crisis, the changes enabled companies to cut their costs at the expense of workers' stability.

The legacy of these reforms, apart from the increased competitiveness praised by Hernández de Cos, is a labour market riddled with insecurity and unemployment, in which a quarter of the workforce are on temporary contracts. Hernández de Cos's appeal is to a socialist government - whose Employment Minister is a member of the Spanish Communist Party - that has vowed to repeal Rajoy's reforms and make life better for workers. In other words, it is not likely to be heeded.

Meanwhile, Philip Alston, the UN's Special Rapporteur on Extreme Poverty and Human Rights, has been on a 12-day "fact finding" mission to Spain to explore the socio-economic realities masked by stellar GDP performance. According to Spain's National Statistics Institute, 26.1% of Spaniards are living at risk of poverty or social exclusion, a figure that rises to 38.2% in Andalucía, the second highest in mainland Spain after Extremadura, where it's a staggering 44.6%.

Alston's visit to Madrid and several outlying towns - documented in a thought-provoking article by Sam Jones in The Guardian this week - highlighted the problems faced by Spanish families struggling to make ends meet, especially with rent payments (rental prices have increased by around 50% in Spain over the last six years). One lady from Torrejón de Ardoz, whose family's rent has recently rocketed from ¤816 to ¤1,400 per month, told Jones that "we've got politicians up to our eyeballs but none of them does anything".

The UN investigator, whose research also included a trip to the notorious Polígono Sur neighbourhood in Seville, wasn't wrong when he said that "something drastic needs to be done" to combat social inequality in Spain; but it's questionable how much difference, if any, his resulting report will make to the lives of the people he met. Only the new Spanish government, which has vowed to cap rental prices, prevent hasty evictions and make further increases to an already much-improved minimum wage, can do that.

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