Little to say because the government-approved Stability Programme, which envisages quickly attaining a significant deficit cut, has been favourably assessed by the EU and strictly met in its first year. The now-difficult task is for all levels of government to rigorously meet their adjustment commitments this year and to enable the 6% overall general government deficit target to be attained. Henceforth, we should expect local and regional authorities not to put off any longer the vigorous expenditure-cutting decisions that are needed to meet this overall target. BIS central bankers’ speeches  3  Finally, concerning the restructuring of savings banks, the final part of what was legislated by Parliament in the recapitalisation Decree-Law approved in February remains to be done, but so far the Decree-Law has been implemented under the conditions and within the timeframe set. On 11 March the Banco de España published the core capital requirements of all Spanish credit institutions. Among them, 12 (4 banks and 8 savings banks) were identified as having a core capital deficit for a maximum amount of € billion. Later, when one of the integration projects came unstuck, the number of institutions needing additional capital rose to 13. On 14 April, the Banco de España approved the strategies and timetables submitted by these 13 institutions or groups.
But this task has also become a pressing one since, as euro area membership precludes using the devaluation tool, reform of the employment institutional framework is vital for increasing productivity, and thus for restoring competitiveness and raising our growth rate. Lately, those convinced of the importance of this reform have grown in number. But among those showing reluctance, a new argument has now arisen which seeks to play down the need for reform because, they say, it will take time to bear fruit. I have two counter-arguments here. First, Spain has moved so far away from the various employment institutional framework models in the developed countries that a rapid approximation to them could have more immediate effects than in other countries. Admittedly, a reform of this type would not swiftly lower our unemployment rate to the average European level, which is below 10%; but a reduction in the unemployment rate, no matter how modest at first, would have most favourable consequences for domestic and external confidence in the Spanish economy. What’s more, even if it is thought that results will only emerge gradually, slowness in taking effect is no argument for delaying this reform a minute longer; rather, it is an excellent reason to adopt it immediately so as to be able to enjoy its effects as soon as possible. Regarding fiscal consolidation, there is little to say and much to do.