Spain threatens to cut Catalonia funds over referendum

Catalonia's pro-independence regional government plans to hold a secession vote in the wealthy northeastern region on October 1, in defiance of Spain's central government in Madrid which has repeatedly said such a vote would violate the constitution.

Spain threatens to cut Catalonia funds over referendum

World Bulletin / News Desk

Spain's central government on Friday threatened to cut off funds for Catalonia unless the region's administration can prove it is not using state money to prepare a referendum on independence.

"Not one euro of Catalan money will go to an illegal referendum that is desired by a handful of people," Spanish government spokesman Inigo Mendez de Vigo said.

Spain's central government will tighten its oversight of spending by Catalan authorities by requiring them to provide weekly accounts to show no money is being used to stage the independence vote, he added.

If this obligation is not respected, Madrid will cut off Catalonia's access to a credit line known as the Autonomous Liquidity Fund that provides extra money to Spain's regional governments, Mendez de Vigo said.

The Autonomous Liquidity Fund was set up by Spain's central government in 2012 to lend money to regions that, because of the country's financial crisis, could not issue debt in financial markets.

Catalonia has received 67 billion euros ($77.5 billion) from the credit line since it was set up, and is expected to collect 3.6 billion euros from it this year, according to Spain's central government.

The government's move was justified because Spain's Constitutional Court ruled earlier this month that clauses in the Catalan's regional government's 2017 budget that set aside money for the referendum were illegal, Mendez de Vigo said.

It comes just two days after Spain's court of auditors announced it would try to hold the former head of the regional government of Catalonia, Artur Mas, and several of his ministers personally accountable for 5.1 million euros that was used to hold a mock independence referendum in 2014.

In March Mas was found guilty of contempt of court for staging to symbolic referendum despite a legal order that it not go ahead, and was barred from public office for two years.

Güncelleme Tarihi: 22 Temmuz 2017, 17:45