Stricter rules for public spending to avoid hidden debts

Automatic summary, not yet reviewed

1. Government advances of funds must be canceled within the same fiscal year, with a limit of 1% of the credits in the State budget. Only advances linked to European funds may be canceled in the following year.
2. Certain credits, such as those for electricity, fuel, transport or reserved expenses, become binding at the article level, meaning money cannot be spent on a different line than the one approved.
3. Spending commitments extending to future years are only allowed in specific cases (investments, transfers from rules with the rank of law, certain contracts, leases of real estate and debt charges), for at most four years, with limited percentages: 70%, 60% and 50% depending on the year.
4. Charging obligations created in previous years to the current budget requires the approval of the Minister of Economy and Finance, along with a report explaining why they were not charged to the budget at the time.
5. For emergency works, acting without a budget credit is no longer enough: the decision must include a credit hold or the start of the process to modify the budget, and the Council of Ministers must be informed within a maximum of thirty days.
6. Declaring an urgent occupation of expropriated property requires a prior credit hold in the file sent to the Council of Ministers. Council of Ministers approval is also required for agreements with undetermined or multi-year spending.

Who it affects

• Ministries and State autonomous agencies: They face more restrictions on multi-year spending commitments, advances of funds and signing agreements.
• The Government and the Council of Ministers: They must approve agreements with undetermined or multi-year spending and be informed of emergency works within thirty days.
• The Minister of Economy and Finance: Must approve charging previous years' obligations to the current budget and can change percentages and deadlines for spending commitments.
• Administrations that expropriate or contract emergency works: They need a prior credit hold before declaring an urgent expropriation or carrying out an emergency work.

Words worth knowing

Ejercicio presupuestario

The calendar year covered by the budget, to which expenses must be charged.

Anticipo de fondos

Money advanced to pay an urgent expense while the formal budget credit is being approved.

Retención de crédito

Setting aside part of the budget to make sure money is available for an expense.

Modificado presupuestario

A procedure to change the approved budget, for example to increase the money in a line item.

Justiprecio

The monetary value set as compensation to the owner whose property is expropriated.

It summarizes the law as published in the BOE. It is written by artificial intelligence and may contain mistakes: the official text is what counts. Read the official text · How we make summaries