Castilla-La Mancha approves €10.02 billion spending ceiling for 2027 as finance chief rejects ERC fiscal deal

Spending limit approval

The Governing Council of Castilla-La Mancha approved the non-financial expenditure limit for 2027 on Tuesday, setting the regional spending ceiling at 10,019 million euros. The figure represents an 11.3% increase compared to the 2026 ceiling, which translates to an absolute rise of 1,018 million euros. Regional Minister of Finance, Public Administrations and Digital Transformation Juan Alfonso Ruiz Molina announced the decision during a press conference in Toledo. He confirmed that the ceiling will be sent immediately to the regional parliament, the Cortes of Castilla-La Mancha, for debate and formal approval. This legislative endorsement is a mandatory procedural step required before the regional administration can draft and present its comprehensive annual budget bill for the coming year.

Revenue projections and calculations

The regional finance department calculated the ceiling using data provided by Spain's Ministry of Finance on 29 July regarding resources from the autonomous financing system. Total projected non-financial own revenues for 2027 are expected to reach 9,994 million euros, reflecting a 9.6% expansion relative to 2026. The vast majority of these funds, amounting to 8,587 million euros or 86% of the total, will originate directly from the state autonomous financing system. The remaining 1,406 million euros, accounting for 14%, will be collected through regionally managed taxes and non-earmarked transfers from both the central government and the European Union. Within the state financing allocation, advance payments are projected to rise by 8.4%, while the settlement from the 2022 financial year will increase by 39% to 514 million euros.

Criticism of the central financing pact

Ruiz Molina used the budget presentation to reiterate his firm opposition to the new regional financing framework negotiated between Prime Minister Pedro Sánchez's administration and the Catalan party ERC. The regional minister criticized both the procedural path and the substance of the agreement just days before multilateral discussions begin. He argued that negotiating the architecture of regional funding exclusively with a single political formation compromised the legitimacy of the process. In addition, Ruiz Molina asserted that the proposed model violates the principle of territorial equality by applying the concept of ordinality. Under that approach, regions that generate higher tax contributions are positioned to receive higher funding for their public services.

The model has sinned in its forms in that it was negotiated with a political party that is ERC.

Demands ahead of the fiscal summit

Castilla-La Mancha has called for an urgent reform of the general financing system while maintaining that it will firmly reject the current bilateral plan. The debate will formally move to the multilateral stage on Friday, 4 September, when the Fiscal and Financial Policy Council convenes. Ruiz Molina stated that he will formally ask the central finance ministry to abstain if the proposed financing arrangement is brought to a vote during the session. An abstention by the central administration would allow the final vote to reflect the genuine collective position of the autonomous communities on the allocation of essential public service resources.