Recommendation for a COUNCIL RECOMMENDATION endorsing the national medium-term fiscal-structural plan of Spain
Date: 2024-11-26
Institutions: Directorate-General for Economic and Financial Affairs, European Commission
Subjects: Spain, budget deficit, coordination of EMU policies, economic reform, fiscal policy, investment, macroeconomics, national planning, public debt, structural adjustment

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   EUROPEAN COMMISSION  Strasbourg, 26.11.2024  COM(2024) 730 final  Recommendation for a COUNCIL RECOMMENDATION endorsing the national medium-term fiscal-structural plan of Spain  
 
Recommendation for a 

COUNCIL RECOMMENDATION 

endorsing the national medium-term fiscal-structural plan of Spain 

THE COUNCIL OF THE EUROPEAN UNION, 

Having  regard  to  the  Treaty  on  the  Functioning  of  the  European  Union,  and  in  particular 
Article 121 thereof, 

Having regard to Regulation (EU) 2024/1263, and in particular Article 17 thereof, 

Having regard to the recommendation from the European Commission, 

Whereas: 

GENERAL CONSIDERATIONS 

(1) 

(2) 

1 

2 

3 

A  reformed  EU  economic  governance  framework  entered  into  force  on  30  April 
2024. Regulation 2024/1263 of the European Parliament and of the Council (EU) on 
the  effective  coordination  of  economic  policies  and  on  multilateral  budgetary 
surveillance,1  together  with  the  amended  Regulation  (EC)  No  1467/97  on  the 
implementation  of  the  excessive  deficit  procedure,2  and  the  amended  Council 
Directive 2011/85/EU on the budgetary frameworks of Member States3 are the core 
elements of the reformed EU economic governance framework. The framework aims 
at  ensuring  public  debt  sustainability  and  sustainable  and  inclusive  growth  through 
reforms  and  investments.  It  promotes  national  ownership  and  has  a  medium-term 
focus, combined with an effective and coherent enforcement of the rules.  

The  national  medium-term  fiscal-structural  plans  that  Member  States  submit  to  the 
Council  and  to  the  Commission  are  at  the  centre  of  the  new  economic  governance 
framework. The plans are to deliver on two objectives: i) ensuring that, by the end of 
the  adjustment  period,  general  government  debt  is  on  a  plausibly  downward 
trajectory, or stays at prudent levels, and that the government deficit is brought and 
maintained below the reference value of 3% of GDP over the medium term, and ii) 
ensuring the delivery of reforms and investments responding to the main challenges 

Regulation 

(EC)  No 

Regulation  (EU)  2024/1263  of  the  European  Parliament  and  of  the  Council  of  29  April  2024  on  the 
effective  coordination  of  economic  policies  and  on  multilateral  budgetary  surveillance  and  repealing 
Council 
ELI: 
ttp://data.europa.eu/eli/dir/2024/1265/oj). 
Council  Regulation  (EU)  2024/1264  of  29  April  2024  amending  Regulation  (EC)  No  1467/97  on 
speeding  up  and  clarifying  the  implementation  of  the  excessive  deficit  procedure  (OJ  L,  2024/1264, 
30.4.2024, ELI: http://data.europa.eu/eli/reg/2024/1264/oj). 
Council Directive (EU) 2024/1265 of 29 April 2024 amending Directive 2011/85/EU on requirements 
(OJ  L,  2024/1265,  30.4.2024,  ELI: 
for  budgetary 
http://data.europa.eu/eli/dir/2024/1265/oj). 

the  Member  States 

frameworks  of 

2024/1265, 

30.4.2024, 

1466/97 

(OJ 

L, 

EN 

1 

  EN 

 
 
 
 
identified  in  the  context  of  the  European  Semester  and  addressing  the  common 
priorities of the EU. To that end, each plan is to present a medium-term commitment 
to a net expenditure4 path, which effectively establishes a budgetary constraint for the 
duration  of  the  plan,  covering  4  or  5  years  (depending  on  the  regular  term  of 
legislature in  a Member  State). In  addition,  the plan  is  to  explain how the Member 
State  will  ensure  the  delivery  of  reforms  and  investments  responding  to  the  main 
challenges  identified  in  the  context  of  the  European  Semester,  in  particular  in  the 
country-specific recommendations (including those pertaining to the macroeconomic 
imbalances procedure (MIP), if applicable), and how the Member State will address 
the common priorities of the Union. The period for fiscal adjustment covers a period 
of  four  years,  which  may  be  extended  by  up  to  three  years  if  the  Member  State 
commits  to  delivering  a  set  of  relevant  reforms  and  investments  that  satisfies  the 
criteria set out in Regulation (EU) 2024/1263.  

Following  the  submission  of  the  plan,  the  Commission  is  to  assess  whether  it 
complies with the requirements of Regulation (EU) 2024/1263. 

Upon  a  recommendation  from  the  Commission,  the  Council  is  to  then  adopt  a 
recommendation to set the net expenditure path of the Member State concerned and, 
where  applicable,  endorses  the  set  of  reform  and  investment  commitments 
underpinning an extension of the fiscal adjustment period. 

(3) 

(4) 

CONSIDERATIONS CONCERNING SPAIN 

(5) 

On 15 October 2024, Spain submitted its national medium-term fiscal-structural plan 
to  the  Council  and  to  the  Commission.  The  submission  took  place  following  an 
extension  of  the  deadline  set  out  in  Article  36(1),  point  (a)  of  Regulation  (EU) 
2024/1263, as agreed with the Commission in view of the reasons provided by Spain.  

Process prior to the submission of the plan  

(6) 

On 21 June 2024 the Commission sent, according to Article 9 of the Regulation (EU) 
2024/1263,  the  reference  trajectory5  to  Spain.  The  Commission  published  the 

4 

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Net expenditure as defined in Article 2 of Regulation (EU) 2024/1263, namely government expenditure 
net  of  (i)  interest  expenditure,  (ii)  discretionary  revenue  measures,  (iii)  expenditure  on  Union 
programmes fully matched by revenue from Union funds,  (iv) national expenditure on co-financing of 
programmes funded by the Union, (v) cyclical elements of unemployment benefit expenditure and (vi) 
one-offs and other temporary measures.  
Prior  guidance  transmitted  to  the  Member  States  and  Economic  and  Financial  Committee  includes 
trajectories  without  and  with  an  extension  of  the  adjustment  period  (covering  4  and  7  years, 
respectively).  It  also  includes  the  main  initial  conditions  and  underlying  assumptions  used  in  the 
Commission’s  medium-term  government  debt  projection  framework.  The  reference  trajectory  was 
calculated on the basis of the methodology described in the Commission’s Debt Sustainability Monitor 
2023  (https://economy-finance.ec.europa.eu/publications/debt-sustainability-monitor-2023_en).  It 
is 
based on the European Commission Spring 2024 Forecast and its medium-term extension up to 2033, 
and  long-term  GDP  growth  and  ageing  costs  are  in  line  with  the  joint  Commission-Council  2024 
Ageing  Report  (https://economy-finance.ec.europa.eu/publications/2024-ageing-report-economic-and-
budgetary-projections-eu-member-states-2022-2070_en). 

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reference trajectory on 15 October 20246. The reference trajectory is risk-based and 
ensures that, by the end of the fiscal adjustment period and in the absence of further 
budgetary measures beyond the adjustment period, general government debt is on a 
plausibly downward trajectory or stays at prudent levels over the medium term, and 
the  general  government  deficit  is  brought  below  3%  of  GDP  over  the  adjustment 
period  and  maintained  below  that  reference  value  over  the  medium  term.  The 
medium term is defined as the ten-year period after the end of the adjustment period. 
In  accordance  with  Articles  7  and  8  of  Regulation  (EU)  2024/1263,  the  reference 
trajectory  is  also  consistent  with  the  debt  sustainability  safeguard  and  the  deficit 
resilience safeguard. 

The  reference  trajectory  of  Spain  sets  out  that,  based  on  the  Commission’s  assumptions 
and assuming a 7-year adjustment period, net expenditure should not grow by more than 
the  values  provided  in  Table  1.  This  corresponds  to  average  net  expenditure  growth  of 
2.8% over the adjustment period (2025-2031) and of 2.9% over the period covered by the 
plan (2025-2028).  

Table 1: Reference trajectory provided by the Commission to Spain on 21 June 2024 

2025 

2026 

2027 

2028 

2029 

2030 

2031 

Average 
2025-
2028 

Average 
2025-
2031 

3.2  

2.8  

2.7  

2.7  

2.7  

2.6  

2.5  

2.9 

2.8 

Maximum net 
expenditure 
growth (annual, 
%) 

Source: Commission’s calculations. 

(7) 

In  line  with  Article  12  of  Regulation  (EU)  2024/1263,  Spain  and  the  Commission 
engaged in a technical dialogue from July to October 2024. The dialogue centred on 
the  net  expenditure  path  envisaged  by  Spain  and  its  underlying  assumptions  (in 
particular the use of data driven updates), the envisaged set of reform and investment 
commitments  to  underpin  an  extension  of  the  adjustment  period  including  reforms 
and  investments  such  as  budgetary  measures  in  the  fields  of  taxation  and  public 
expenditure, as well as the envisaged delivery of reforms and investments responding 
to  the  main  challenges  identified  in  the  context  of  the  European  Semester  and  the 
common  priorities  of  the  Union  in  fair  green  and  digital  transition,  social  and 
economic resilience, energy security and the build-up of defence capabilities. 

6  https://economy-finance.ec.europa.eu/economic-and-fiscal-governance/national-medium-term-fiscal-

structural-plans_en#spain 

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(8) 

(9) 

The plan submitted by Spain does not report on a consultation process with relevant 
national stakeholders (including social partners) prior to submission. 

The  Spanish  independent  fiscal  institution,  AIReF,  delivered  an  opinion  on  the 
macroeconomic  forecast  and  the  macroeconomic  assumptions  underpinning  the 
multi-annual  net  expenditure  path.  The  macroeconomic  scenario  2024  to  2026 
serving  as  the  starting  point  for  the  macroeconomic  projections  and  debt 
sustainability analysis was endorsed by AIReF.  

Other related processes 

(10) 

On  21  October  2024  the  Council  addressed  to  Spain  a  series  of  country-specific 
recommendations (CSRs) in the context of the European Semester7.  

COMMISSION’S ASSESSMENT OF THE PLAN 

(11) 

In line with Article 16 of Regulation (EU) 2024/1263, the Commission assessed the 
plan as follows: 

Macroeconomic and fiscal situation and outlook  

(12) 

Economic  activity  in  Spain  grew  by  2.7%  in  2023,  driven  by  robust  labour  market 
developments  which  sustained  private  consumption,  as  well  as  by  the  contribution 
from  net  exports  and  public  consumption.  According  to  the  European  Commission 
Autumn  2024  Forecast,  the  economy  is  expected  to  grow  by  3.0%  in  2024,  on  the 
back of the positive evolution of public and private consumption, upheld by dynamic 
job  creation  and  real  income  gains  for  households,  and  by  the  contribution  from 
tourism  activity.  In  2025,  real  GDP  is  set  to  increase  by  2.3%,  as  consumption 
growth  and  the  expected  broad-based  pick-up  in  investment,  notably  on  equipment 
and  housing,  are  projected  to  underpin  economic  activity.  In  2026,  real  GDP  is,  at 
this  stage,  expected  to  increase  by  2.1%,  as  domestic  demand  is  set  to  support  the 
economic  expansion.  Over  the  forecast  horizon  (i.e.  2024-2026),  potential  GDP  in 
Spain  is  expected  to  decrease  slightly,  from  2.4%  in  2023  to  2.3%  in  2026,  as  the 
labour  contribution  to  potential  growth  softens.  The  unemployment  rate  stood  at 
12.2% in 2023 and is projected by the Commission to amount to 11.5% in 2024 and 
11.0%  in  2025  and  10.7%  in  2026.  In  2024,  inflation  (GDP  deflator)  is  decreasing 
from  6.2% in  2023 to  3.1% in  2024, and is set  to reach  2.4% in  2025 and  2.0% in 
2026.  

7 

Council  Recommendation  on  economic,  budgetary,  employment  and  structural  policies  of  ,  not  yet 
published.Spain 

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(13) 

Regarding  fiscal  developments,  in  2023  Spain’s  general  government  deficit 
amounted  to  3.5%  of  GDP.  According  to  the  European  Commission  Autumn  2024 
Forecast,  it  is  set  to  reach  3.0%  of  GDP  in  2024  and  to  decline  further  to  2.6%  of 
GDP in 2025 and, on a no-policy change basis, to broadly stabilise (2.7%) in 2026. 
The  European  Commission  Autumn  2024  Forecasts  does  not  include  Spain’s  draft 
budget  for  2025,  not  yet  adopted  by  the  Spanish  government  at  the  date  of  their 
publication. General government debt was  105.1% of GDP at  end-2023. According 
to  the  European  Commission  Autumn  2024  Forecast,  the  debt  ratio  is  expected  to 
decline to 102.3% of GDP at end-2024. It is projected to decline to 101.3% of GDP 
at end-2025 and to 101.1% at end-2026. The fiscal forecast by the Commission does 
not  consider  the  policy  commitments  in  the  medium-term  plans  as  such,  until  they 
are  underpinned  by  credibly  announced  and  sufficiently  specified  concrete  policy 
measures. 

Net expenditure path and main macroeconomic assumptions in the plan  

(14) 

Spain’s national medium-term fiscal-structural plan covers the period 2025-2028 and 
presents a fiscal adjustment over seven years.  

(15) 

The  plan  contains  the  information  required  by  Article  13  of  Regulation  (EU) 
2024/1263.  

(16) 

The plan commits to the net expenditure path indicated in Table 2, corresponding to 
average net expenditure growth of 3.4% over the years 2025-2028. In addition, Spain 
commits  to  a  set  of  reforms  and  investments  with  the  view  to  extending  the 
adjustment  period  to  7  years  (2025-2031),  over  which  the  average  net  expenditure 
growth is planned to be 3.0%.  

The  average  net  expenditure  growth  reported  in  the  plan  over  the  adjustment  period 
(2025-2031)  is  higher  than  the  reference  trajectory  transmitted  by  the  Commission  on 
21 June 2024.  

The plan assumes potential GDP growth to increase from 1.9% to 2.1% in 2025-2027 and 
thereafter  decrease  gradually  to  1.1%  by  2031.  In  addition,  the  plan  expects  the  growth 
rate  of  the  GDP  deflator  to  decrease  to  2.7%  in  2025  from  3.1%  in  2024,  before 
decreasing further to 2.4% in 2026-2028 and 2.3% in 2029-2031.  

Table 2: Net expenditure path and main assumptions in Spain’s plan  

Extension of the 
adjustment period 

2024 

2025 

2026 

2027 

2028 

2029 

2030 

2031  Average 
over the 

Average 
over the 

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adjustment 
period 

2025 – 
2031 

period of 
validity 
of the 
plan 

2025-
2028 

Net expenditure 
growth 
(annual, %) 

Net expenditure 
growth 
(cumulative, from 
base year 2023, %) 

Potential GDP 
growth (%) 

Inflation (GDP 
deflator growth) 
(%) 

5.3 

3.7 

3.5 

3.2 

3.0 

3.0 

2.5 

2.4 

3.4 

3.0 

5.3 

9.2 

13.0 

16.6 

20.1 

23.7 

26.8 

29.9 

n.a. 

n.a. 

1.9 

2.0 

2.1 

1.8 

1.6 

1.6 

1.2 

1.1 

1.9 

1.6 

3.1 

2.7 

2.4 

2.4 

2.4 

2.3 

2.3 

2.3 

2.5 

2.4 

Source: Medium-term fiscal-structural plan of Spain and Commission’s calculations 

Implications of the plan’s net expenditure commitments for general government debt  

(17) 

If the net expenditure path committed to in the plan and the underlying assumptions 
materialise, general government debt would gradually decrease from 102.5% in 2024 
to 90.6% of GDP at the end of the adjustment period (2031), according to the plan, as 
per the following table. After the adjustment, over the medium term (i.e. until 2041), 
the general government debt would continue to gradually decrease, according to the 
plan, reaching 76.8% of GDP by 2041.  

Table 3: General government debt and balance developments in Spain’s plan  

2023 

2024 

2025 

2026 

2027 

2028 

2029 

2030 

2031 

2041 

Government 
debt 

(% of GDP) 

Government 
balance 

(% of GDP) 

105.0 

102.5 

101.4 

100.1 

98.4 

96.6 

94.8 

92.8 

90.6 

76.8 

-3.5 

-3.0 

-2.5 

-2.1 

-1.8 

-1.6 

-1.5 

-1.2 

-0.8 

-2.0 

Source: Medium-term fiscal-structural plan of Spain  

Thus,  according  to  the  plan,  the  general  government  debt  ratio  would  be  put  on  a 
downward path by the end of the adjustment period (2031). This is plausible as, based on 
the  plan’s  assumptions,  debt  is  projected  to  decline  over  the  ten  years  following  the 
adjustment  period  under  all  deterministic  stress  tests  of  the  Commission’s  Debt 

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Sustainability  Analysis,  and  the  stochastic  projections  indicate  that  debt  would  decline 
with a sufficiently high probability.  

Therefore, based on the plan’s policy commitments and macroeconomic assumptions, the 
net expenditure path put forward in the plan is consistent with the requirement for debt as 
set out in Articles 6, point (a), and 16(2) of Regulation (EU) 2024/1263.  

Implications of the plan’s net expenditure commitments for general government balance 

(18) 

Based  on  the  plan’s  net  expenditure  path  and  assumptions,  the  general  government 
deficit would stand at 3.0% in 2024 and gradually narrow to reach 0.8% in 2031.  

Thus, according to the plan, the general government balance would not exceed the 3% of 
GDP reference value at the end of the adjustment period (2031).  

In  addition,  in  the  ten  years  following  the  adjustment  period  (i.e.  until  2041),  the 
government deficit would not exceed 3% of GDP.  

Therefore, based on the plan’s policy commitments and macroeconomic assumptions, the 
net  expenditure  path  put  forward  in  the  plan  is  consistent  with  the  requirement  for  the 
deficit as set out in Articles 6, point (b), and 16(2) of Regulation (EU) 2024/1263.  

Time profile of the fiscal adjustment 

(19) 

 The  time  profile  of  the  fiscal  adjustment,  measured  as  the  change  in  the  structural 
primary balance, as described in the plan, is linear, as required by Article 6, point (c) 
of Regulation (EU) 2024/1263. In addition, the fiscal adjustment over the first four 
years of the plan is proportional to the total adjustment effort. 

Therefore, based on the plan’s policy commitments and macroeconomic assumptions, the 
net  expenditure  path  put  forward  in  the  plan  is  consistent  with  the  no-backloading 
safeguard clause set out in Article 6, point (c) of Regulation (EU) 2024/1263.  

Table 4: Structural primary balance developments in Spain’s plan  

2023 

2024 

2025 

2026 

2027 

2028 

2029 

2030 

2031 

Structural primary 
balance 

-0.9 

-0.6 

-0.2 

0.2 

0.7 

1.1 

1.5 

1.9 

2.3 

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(% of GDP) 

Change in structural 
primary balance 

(pps.) 

n.a. 

0.4 

0.4 

0.4 

0.4 

0.4 

0.4 

0.4 

0.4 

Source: Medium-term fiscal-structural plan of Spain 

Consistency of the plan with the deficit resilience safeguard 

(20) 

In accordance with Article 8 of Regulation (EU) 2024/1263, the annual adjustment in 
the structural primary balance should not be less than 0.25% of GDP if the structural 
deficit  remained  above  1.5%  of  GDP  in  the  preceding  year,  to  achieve  a  common 
resilience  margin  in  structural  terms  of  1.5%  of  GDP.  The  fiscal  adjustment  that 
results from the plan’s policy commitments and macroeconomic assumptions is 0.4% 
of  GDP  in  each  year  from  2025  to  2031  Therefore,  based  on  the  plan’s  policy 
commitments and macroeconomic assumptions, the net expenditure path put forward 
in the plan is consistent with the deficit resilience safeguard.  

Consistency of the plan with the debt sustainability safeguard 

(21) 

In accordance with Article 7 of Regulation (EU) 2024/1263, as  general government 
debt will be above 90% of GDP over the adjustment period according to the plan, the 
debt  ratio  is  required  to  decline  by  at  least  1 percentage  point  on  average  per  year 
until  it  falls  below  90%,  after  which  it  should  decline  by  0.5 percentage  points  on 
average. This average decline is calculated over the period 2024-2031 and amounts 
to  1.7 percentage  points  (see  Table  3).  Therefore,  based  on  the  plan’s  policy 
commitments and macroeconomic assumptions, the net expenditure path put forward 
in the plan is consistent with the debt sustainability safeguard.  

The macroeconomic assumptions of the plan 

(22) 

The  plan  is  based  on  a  set  of  assumptions  which  differs  from  the  Commission’s 
assumptions  transmitted  to  Spain  on  21  June  2024.  In  particular,  the  plan  uses 
different assumptions for six variables, namely the starting point (i.e., the fiscal and 
macroeconomic  conditions  in  2024),  potential  GDP  growth,  GDP  deflator  growth, 
real  GDP  growth  and  output  gap  closure,  the  nominal  implicit  interest  rate,  and 
revenue  assumptions.  A  careful  assessment  of  these  differences  in  assumptions  is 
necessary, especially as average net expenditure growth in the plan is higher than the 
reference trajectory. 

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The  differences  in  assumptions  with  the  most  significant  impact  on  average  net 
expenditure  growth  are  listed  below,  together  with  an  assessment  of  each  difference 
considered in isolation.  

• 

• 

• 

The  plan  relies  on  different  potential  GDP  assumptions  compared  with  the 
prior  guidance.  Revisions  to  the  past  level  of  potential  GDP  imply  a  smaller 
positive  output  gap  in  2024,  implying  in  turn  a  higher  structural  primary 
balance  in  that  year.  Moreover,  potential  GDP  growth  over  the  adjustment 
period  2025-2031  is  higher  than  in  the  Commission’s  assumptions  of  spring 
2024, by 0.2 percentage points on average. This contributes to higher average 
net expenditure growth over the adjustment period in the plan than according to 
the reference trajectory. The higher potential GDP growth over the adjustment 
period  results  from  an  update  of  potential  GDP  series,  performed  by  Spain, 
based  on  the  EU  commonly  agreed  methodology.  This  update  integrates 
Spain’s  short-term  macroeconomic  projections  in  the  plan,  which  are  slightly 
more  favourable  than  in  the  prior  guidance  but  broadly  in  line  with  the 
European  Commission  Autumn  2024  Forecast.  Spain’s 
shorter-term 
projections  also  include  the  upward  revision  of  historical  real  GDP  growth 
series  following  the  statistical  revision  issued  by  Eurostat  in  its  mid-term 
review,  and  the  update  of  Eurostat  population  projections.  Consequently,  this 
assumption is deemed to be duly justified.     

The  plan  differs  from  the  prior  guidance  on  two  aspects  regarding  the 
assumption  for  GDP  deflator  growth.  First,  based  on  increasing  labour  unit 
costs, the plan includes a GDP deflator growth  for 2025 that is  higher by 0.4 
percentage  points  than  in  the  prior  guidance.  This  is  0.3  percentage  points 
higher  than  both  the  European  Commission  2024  Autumn  Forecast  and  the 
forecast  of  the  Spanish  independent  fiscal  council  (AIReF)8.  Therefore,  this 
assumption is deemed not to be duly justified. Second, as from 2026, the GDP 
deflator growth converges faster and to a lower level (2.2%) than what would 
be  required  under  the  common  DSA  framework  (2.6%  in  the  prior  guidance, 
and  2.4%  based  on  updated  market  expectations  in  September  2024).  Hence, 
this assumption is more prudent and deemed to be duly justified. Overall, the 
average GDP deflator growth over the entire projection period (2025-2041) is 
lower  in  the  plan  than  according  to  the  Commission’s  assumptions,  at  2.3% 
compared to 2.4%. The assumptions on GDP deflator growth contributes to a 
lower average net expenditure growth in the plan than under the Commission’s 
assumptions.  

In the plan, the projections  for the cost of ageing, and particularly of pension 
expenditure,  remain  fully  in  line  with  the  common  DSA  framework,  which 
relies  on  the  2024  Ageing  Report.  However,  the  plan  deviates  from  the  ‘no-
fiscal-policy-change’ assumption applied beyond the adjustment period. Under 
the common DSA framework, social contributions projections, including those 
paid into the pension system, are assumed to remain constant as a ratio to GDP 
during the ten years that follow the end of the adjustment period, i.e. from 2032 
to 2041. By contrast, the plan internalises the impact of compensatory revenue 

8 

https://www.airef.es/wp-content/uploads/2024/11/INFORME-PLAN-FISCAL-LINEAS-
FUNDAMENTALES/AIReF_Informe-Lineas-Fundamentales-2025.pdf  

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measures legislated in 2023 (along with the pension reform) that will continue 
to  materialise  after  2031.  This  leads  to  a  cumulative  increase  in  social 
contributions  of  1.8  percentage  points  of  GDP  over  those  ten  years,  which 
improves  the  debt  dynamics.  Therefore,  these  measures  lower  the  adjustment 
required to put debt on a plausibly downward path and enable a higher average 
net expenditure growth over the adjustment period in the plan than according to 
the  Commission’s  assumptions.  This  assumption  relies  on  the  description  of 
legislated  measures  in  Spain’s  Country  fiche  accompanying  the  2024  Ageing 
Report9. Therefore, this assumption is deemed to be duly justified. 

The remaining differences in assumptions do not have a significant impact on average net 
expenditure growth compared to the Commission’s assumptions.  

On balance, the joint impact of more cautious assumptions and differences in assumptions 
that are considered as duly justified outweighs the differences in assumptions that are not 
considered as duly justified. This implies that the difference between the net expenditure 
path in the plan and the reference trajectory is explained by differences in assumptions that 
overall can be accepted, in line with Article 13, point (b), of Regulation (EU) 2024/1263.  

Overall,  all  the  differences  in  assumptions  taken  together  lead  to  an  average  net 
expenditure growth in the plan that is higher than the reference trajectory. 

The Commission will take into account the above assessment of the plan’s assumptions in 
future assessments of compliance with the net expenditure path. 

Fiscal strategy of the plan  

(23) 

The  plan  does  not  include  an  indicative  fiscal  strategy  to  implement  the  net 
expenditure path of the plan, as that path is only set as a technical ceiling that Spain 
commits  not  to  exceed.  The  information  on  the  fiscal  adjustment  on  the  measures 
justifying  the  extension  shows  that,  in  addition  to  the  planned  direct  budgetary 
measures creating savings from revenues and expenditures, a large part of the fiscal 
consolidation need is expected to be covered through the indirect fiscal impact of the 
broad set of growth enhancing measures in the plan. The precise specification of the 
relevant policy measures with direct budgetary effects is to be confirmed or adjusted 
and quantified in the annual budgets. 

Set  of  reform  and  investment  commitments  to  underpin  an  extension  of  the  fiscal 
adjustment period  

9 

https://economy-finance.ec.europa.eu/publications/2024-ageing-report-economic-and-budgetary-
projections-eu-member-states-2022-2070_en 

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(24) 

In the  plan, Spain  commits to  a set  of reforms  and investments,  aiming  to improve 
potential  growth  and  fiscal  sustainability,  to  underpin  an  extension  of  the  fiscal 
adjustment period from 4 to 7 years. 

The set of reforms and investments underpinning an extension of the adjustment period is 
composed of some commitments from Spain’s recovery and resilience plan (RRP); several 
commitments from the RRP with additional specifications; as well as some new reforms 
and investments. This includes the following measures (see also Annex II): 

Reforms  in  the area of digital transformation: the measures are linked to  Component 19 
(investment on the digital transformation of education) included in the RRP, whose final 
milestones  and  targets  are  due  by  Q4-2025.  The  includes  commitments  linked  to 
Component  17  (reform  of  the  Science,  Technology  and  Innovation  Law)  in  the  RRP, 
whose  final  milestones  and  targets  have  already  been  implemented  by  the  time  of  the 
submission.   

Reforms in the area of green transition: the measures are linked to Component 7 (reform 
on the regulatory framework for the promotion of renewable generation) included in the 
RRP,  whose  final  milestones  and  targets  have  already  been  implemented  by  the  time  of 
the submission.  

Reform in the area of taxation: the measures aim at increasing government revenues and 
modernise  the  tax  system  and  include  additional  specifications  linked  to  Component  28 
(adapting the tax system to the reality of the twenty-first century) of the RRP to deliver by 
Q4-2025  a  permanent  increase  in  government  revenues  by  Q4  -2028,  assessed  through 
monitoring reports. The key steps are expected to be completed by Q4-2025 and Q4-2028.  

Reforms  in  the  area  of  public  expenditure:  the  measures  are  additional  specifications 
linked  to  Component  29  (reform  establishing  a  permanent  public  spending  review  and 
evaluation process) included in the RRP. The measures in the plan strengthen the follow-
up of the recommendations with additional commitment to adopt reforms resulting from 
completed  and  ongoing  spending  reviews  and  reducing  yearly  expenditure  by  2028, 
assessed through monitoring reports. The key steps are expected to be completed by Q4-
2026, Q2-2027 and Q1-2028.  

Reforms  in  the area of human capital: additional  commitments aimed at  promoting  dual 
vocational training and at facilitating the recognition of the professional qualifications and 
skills  (with  special  regard  to  university  education)  of  the  foreign-born  population,  to 
increase their productivity and contribution  to  economic growth.  The corresponding key 
steps are expected to be completed by Q4-2025, Q4-2027 and Q4-2028 respectively. 

Reforms  in  the  area  of  physical  capital  and  productivity:  the  measures  are  linked  to 
Component  13  (reform  improving  the  business  regulation  and  climate)  included  in  the 
RRP,  whose  final  milestones  and  targets  have  already  implemented  by  the  time  of  the 

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submission. The plan includes additional commitments aimed at increasing the supply of 
affordable  rental  housing,  as  well  as  the  creation  of  a  common  framework  which 
eliminates the disparity of administrative requirements between autonomous communities 
and local entities. The corresponding key steps are expected to be completed by Q2-2026 
and Q4-2027, respectively. 

Reforms  in  the  area  of  the  fight  against  tax  fraud:  the  measures  are  linked  to 
Component 27  (reform  on  the  adoption  of  the  Anti-Fraud  law)  included  in  the  RRP, 
whose final milestones have already been implemented by the time of the submission.  

Reforms  in  the  area  of  public  expenditure  of  health  services:  additional  commitments 
aimed  at  improving  the  management  of  temporary  disability  benefit,  to  increase  the 
efficiency of public spending. The corresponding key step is expected to be completed by 
Q4-2025.  

(25) 

(26) 

In line with Article 14(3) of Regulation (EU) 2024/1263, each reform and investment 
underpinning  an  extension  of  the  adjustment  period  is  sufficiently  detailed,  front-
loaded, time-bound and verifiable. The budgetary measures on taxation and spending 
reviews have not been specified in the plan. 

The  RRP  commitments  underpinning  the  extension  contain  significant  reforms  and 
investments  aimed  at  improving  fiscal  sustainability  and  enhancing  the  growth 
potential of the economy. In addition, Spain commits to continuing the reform effort 
over  the  period  covered  by  the  medium-term  fiscal-structural  plan  and  maintaining 
the  nationally  financed  investment  levels  realised  over  the  period  covered  by  the 
RRP  (see  below,  Table  5).  The  commitment  will  be  monitored  through  the 
implementation phase of the plan. Accordingly, commitments under the RRP can be 
taken into account for the extension of the adjustment period as provided by Article 
36(1) point (d) of Regulation (EU) 2024/1263.  

(27) 

The  set  of  reforms  and  investments  underpinning  the  extension  is  expected  to 
improve  the  growth  and  resilience  potential  of  Spain’s  economy  in  a  sustainable 
manner as required by Article 14(2), point (a) of Regulation (EU) 2024/1263.  

The different reforms and investments have been grouped in the plan into four major axes, 
each impacting the level of potential GDP through different channels: 

1.  Green  transition:  reforms  and  investments  aimed  at  reducing  dependence  on 
the  competitiveness  and 

improving 

the  use  of  fossil  fuels, 
attractiveness of the Spanish economy.  

thereby 

2.  Digital  transformation:  measures  aimed  at  fostering  the  digitalisation  of  the 
Spanish  economy  and  increasing  the  penetration  of  new  technologies, 
increasing productivity and incentivising the transition to a higher value added 
economy. 

3.  Human  capital:  policy  measures  aimed  at  expanding  both  the  amount  and 
quality of labour supply in Spain, including those related to vocational training 

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measures,  and  the  simplification  of  the  system  for  the  homologation  of 
diplomas. 

4. 

Physical capital and productivity: this axis aims to expanding the capital stock 
installed  in  Spain  as  well  as  total  factor  productivity.  It  includes  measures 
aimed  at  reducing  bureaucratic  barriers  for  businesses,  and  expanding  the 
housing stock. 

The reforms and investments of the medium-term plan which underpin the extension are 
estimated by Spain to increase potential growth by 3.3 percentage points compared to the 
macroeconomic baseline scenario, out of which 1.7 percentage points are due to reforms 
and investments included in the RRP and 1.6 percentage points from additional measures, 
with  the overall impact  concentrated in  the years after the end of the recovery plan (2.1 
percentage points between 2026 and 2031). Several of these reforms and investments are 
included in Annex II. 

Spain  estimates  the  impact  on  growth  and  resilience  with  calibrated  dynamic  stochastic 
general equilibrium models. These models use a number of assumptions for calibrating the 
impact of the policy measures. These include amongst others: the change in the duration 
of  contracts,  the  reduction  in  recruitment  and  redundancy  costs,  the  change  in  the  skills 
composition of the workforce, lowering business barriers and improvement in the demand 
and  supply  of  renewable  energy  sources  and  fossil  fuels.  It  is  prudent  and  credible  to 
expect that the overall impact of these reforms and investment on growth and resilience is 
substantial. It should however be noted that the underlying calibration is prone to risks and 
uncertainty. These  relate in  particular to  the assumed scope and timing of the impact  of 
the measures. 

(28) 

The set of reforms and investments underpinning the extension is expected to support 
fiscal  sustainability  as  required  by  Article  14(2),  point  (b)  of  Regulation  (EU) 
2024/1263.  

The plan illustrates the evolution  of the debt-to-GDP ratio in  several  scenarios based on 
the DSA underlying the plan (2025-2041): the policy scenario underlying the plan shows 
debt declining to 76.8% of GDP by 2041 while in the adverse ‘r-g’ scenario the decline 
would  be  somewhat  slower  with  debt  reaching  85.1%  of  GDP  by  2041.  In  contrast,  the 
constant tax revenue scenario would lead to debt increasing to 119.2% of GDP by 2041, 
highlighting  the  importance  of  an  ambitious  structural  fiscal  adjustment.  Overall,  the 
estimates reported in the plan are deemed plausible. 
Additional considerations about the impact of the reforms underpinning the extension can 
be made. In this respect the plan reports that overall these measures improve the structural 
primary balance by 2.4 percentage points of GDP by 2031, reflecting the combination of 
the  direct  impact  of  some  budgetary  measures  and  the  indirect  fiscal  effect  of  several 
reforms  and  investment  leading  to  higher  economic  activity.  Budgetary  measures 
underpinning the extension overall are expected to contribute by  0.6 percentage point of 
GDP. Tax measures are expected to increase revenues by 0.5 percentage points of GDP. 
Furthermore,  the  future  spending  reviews  are  expected  to  improve  the  review  processes 

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and implement measures to lower the level and improve the efficiency of public spending 
with  a  positive  impact  on  fiscal  sustainability,  reducing  expenditure  by  0.1  percentage 
points  of  GDP  during  the  adjustment  period.  The  plan  also  mentions  other  budgetary 
measures  including  the  fight  against  tax  fraud  and  measures  aimed  at  temporary 
incapacity. For several of these measures, the fiscal impact is not defined. Moreover, the 
plan  shows  an  indirect,  second  round,  budgetary  impact  of  all  the  other  measures 
justifying the extension over the four remaining five policy pillars, totalling savings of 1.4 
percentage points of GDP by 2031 as follows: i) human capital (0.4 percentage points of 
GDP),  ii)  physical  capital  and  productivity  (0.3  percentage  points  of  GDP),  green 
transition  (0.4  percentage  points  of  GDP)  and  iv)  digital  transformation  0.3  percentage 
points of GDP). Several of these reforms and investments are included in Annex II. 

(29) 

(30) 

The set of reforms and investments underpinning the extension address the common 
priorities  of  the  EU  as  required  by  Article  14(2),  point  (c)  of  Regulation  (EU) 
2024/1263.  In  particular,  the  plan  includes  reforms  and  investments  aimed  at 
reducing  dependence  on  the  use  of  fossil  fuels  and  contributing  to  a  fair  green 
transition  and  ensuring  energy  security,  through  a  regulatory  framework  for  the 
promotion  of  renewable  generation.  The  investments  aiming  at  the  digital 
transformation of education are expected to contribute to a fair digital transition by 
fostering  the  digitalisation  of  the  Spanish  economy  and  the  penetration  of  new 
technologies.  In  addition,  investments  aiming  to  expanding  the  quality  of  labour 
supply  in  Spain  and  to  increase  the  supply  of  social  rental  housing  contribute  to 
social  and  economic  resilience,  including  the  European  Pillar  of  Social  Rights,  by 
ensuring  a  fairer  and  more  inclusive  recovery.  The  economic  resilience  is  further 
strengthened by a set of direct budgetary measures.   

The  set  of  reforms  and  investments  underpinning  the  extension  addresses  the 
relevant10  CSR  issued  as  part  of  European  Semester  as  required  by  Article  14(2), 
point (d) of Regulation  (EU) 2024/1263  and aim  to  improve the quality,  efficiency 
and equity of public spending,  notably by introducing  public spending  reviews  and 
expenditure  rationalisation  and  tax  measures  aimed  at  improving  efficiency, 
sufficiency and at making the tax system more just (see also above). The adoption of 
reforms aimed at strengthening and improving the regulation and business climate in 
Spain,  with  a  particular  focus  on  SMEs  addresses  the  2019  and  2020  CSRs  on 
innovation and the improvement of economic activity regulation. These reforms also 
contribute  to  the  2020  CSR  to  improve  administrative  cooperation,  additionally 
underpinned  through  measures  to  simplify  the  system  for  the  homologation  of 
diplomas.  The  2019,  2020,  2022  and  2023 CSRs  focused  on  energy  efficiency,  the 
deployment  of  renewable  energy  and  the  reduction  of  the  overall  reliance  on  fossil 
fuels  are  addressed  through  the  establishment  of  a  regulatory  framework  for  the 
promotion of renewable  generation.  Measures  aimed at  improving  the management 
of temporary incapacity benefits contribute to the CSR requests of 2020 and 2021 to 

10 

Country-specific  recommendations  considered  ‘relevant’  are  recommendations:  i)  adopted  by  the 
Council  from  2019  onwards,  ii)  for  which  the  Member  State  has  not  yet  made  ‘full’  or  ‘substantial’ 
progress in addressing them and are not outdated (assessed as ‘Not Assessed / No Input to Add ’), as 
assessed in the latest European Semester surveillance exercise (available in CeSaR (europa.eu)), iii) not 
linked to purely fiscal SGP-related and iv) not covering the same challenge but in a rephrased manner. 

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improve the health system’s resilience and sustainability. The 2019, 2020 and 2023 
CSRs for the development  of  skills are supported through reforms  and  investments 
aiming to expanding the quality of labour supply in Spain, including those related to 
vocational  training  measures,  and  the  simplification  of  the  system  for  the 
homologation of diplomas. Measures aimed at  the promotion of affordable housing 
through the transfer of land to investors contribute to the 2019, 2022 and 2023 CSRs 
to  offer  support  for  families  and  increase  the  availability  of  energy-efficient  social 
and affordable housing.  

(31) 

The  plan  ensures  that  the  planned  overall  level  of  nationally  financed  public 
investment  realised  on  average  over  the  period  covered  by  RRP  is  maintained,  as 
required by Article 14(4) of Regulation (EU) 2024/1263.  

Table 5: Nationally financed public investment in the plan (% of GDP) 

Average level 
over the period 
covered by the 
RRP (2021 to 
2026) 

2025 

2026 

2027 

2028 

Average over the 
duration of the plan 

2.4 

2.5 

2.6 

2.6 

2.7 

2.6 

Source: Medium-term fiscal-structural plan of Spain and Commission’s calculations. 

(32) 

Finally,  the  set  of  reform  and  investment  commitments  underpinning  an  extension 
can be regarded as consistent with the commitments in the RRP and the Partnership 
Agreement  agreed  under  the  Multiannual  Financial  Framework  as  required  by 
Article 14(4) of Regulation (EU) 2024/1263. The additional specifications to the tax 
reform and spending reviews stem directly from commitments taken under the RRP; 
several of the remaining measures are unmodified RRP commitments. 

(33) 

In conclusion, the set of reforms and investments underpinning the extension of the 
adjustment period is assessed as fulfilling, taken altogether, the criteria in Article 14 
of  Regulation  (EU)  2024/1263.  As  a  result,  the  adjustment  period  can  be  extended 
from 4 to 7 years, as put forward in the plan. 

Other  reforms  and  investments  responding  to  the  main  challenges  identified  in  the 
context of the European Semester and addressing the common priorities of the Union 

(34) 

Besides  the  set  of  reforms  and  investments  underpinning  an  extension  of  the 
adjustment period, the plan describes policy intentions concerning other reforms and 
investments  to  respond  to  the  main  challenges  identified  in  the  context  of  the 
European Semester, especially in the CSRs, and to address the common priorities of 
the EU. The plan includes 44 reforms and investments. 

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(35) 

(36) 

(37) 

Concerning the common priority of a fair green and digital transition, including the 
climate objectives set out in Regulation (EU) 2021/1119, the plan includes a reform 
(included in the RRP) to introduce a National Digital Competences Plan, as well as 
investments destined to improve the level of digital skills of the population. The plan 
includes reforms and investments aimed at reducing dependence on the use of fossil 
fuels and contributing to a fair green transition and ensuring energy security, through 
an  updated  National  Energy  and  Climate  Plan  with  measures  related  to  energy 
storage,  deployment  of  renewables,  promotion  of  self-consumption  and  energy 
efficiency.  The  measures  are  expected  to  address  the  2019,  2020  and  2021  CSRs 
related to the green transition, digital transformation, social and territorial cohesion, 
smart,  sustainable,  and  inclusive  growth  and  policies  for  the  next  generation.  The 
plan does not include other reforms and investments aimed to address the 2022 and 
2024 CSRs on water management and adaptation to climate change as well as waste 
management and circular economy. 

Concerning  the  common  priority  of  social  and  economic  resilience,  including  the 
European Pillar of Social Rights, the plan includes reforms such as the modernisation 
of  active  labour  market  policies,  with  the  aim  of  strengthening  the  Spanish  labour 
market,  addressing  significant  structural  challenges,  including  high  levels  of 
structural and youth unemployment, excessive temporary contracts, low employment 
rates,  and  economic  and  social  inequality.  The  measures  respond  to  the  2019  and 
2020 CSRs related to the functioning of the labour market, including framework for 
labour contracts, undeclared work, active labour market policies, incentives to work 
and  labour  market  participation.  The  plan  does  not  include  other  reforms  and 
investments aimed to address the 2019 and 2020 CSRs on the improvement of public 
procurement frameworks. 

Concerning  the  common  priority  of  energy  security,  the  plan  includes  a  reform  to 
promote the development of energy storage solutions. Additionally, the plan includes 
measures  to  deploy  energy  storage  through  the  launch  of  support  and  investment 
initiatives  to  develop  large-scale storage and promote storage behind  the meter and 
integrated on a sectoral level. The measures intend to address the 2019, 2020, 2022 
and  2023  CSRs  related  to  reducing  the  reliance  on  fossil  fuels,  by  accelerating  the 
deployment of renewable energy with a focus in investment on the green and digital 
transition. The plan does not include other reforms and investments aimed to address 
the 2022 and 2023 CSRs to expand the cross-border electricity interconnections. 

(38) 

Concerning  the  common  priority  of  defence  capabilities,  the  plan  does  not  include 
other reforms and investments. 

(39) 

The  plan  provides  information  on  the  consistency  and  where  appropriate, 
complementarity,  with  Spain’s  RRP.  The  plan  briefly  indicates  that  reforms  and 
investments  included  in  the  plan  respond  to  the  main  challenges  identified  in  the 
context of the European  Semester and address  the common priorities of the Union, 
and are in continuity with the actions adopted in the RRP. 

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(40) 

The plan provides an overview of the public investment needs of Spain related to the 
common priorities of the EU. In relation to the fair green and digital transition, the 
plan  highlights  the  need  for  investments  in  energy  efficiency,  renewable  energy 
deployment,  electrification,  energy  storage,  circular  economy,  and  resilience  across 
all economic sectors, as well as in  advanced technologies like artificial intelligence 
and data analytics and improve digital connectivity nationwide. In relation to social 
and economic resilience, the plan highlights the need for investment in inclusive and 
sustainable growth, by modernizing education, boosting employability, strengthening 
social  protection  systems,  supporting  SMEs  with  resources  and  funding,  and 
enhancing  competitiveness  at  both  national  and  EU  levels.  In  relation  to  energy 
security, the plan highlights the need to reduce fossil fuel dependency, by investment 
aimed at the development of energy infrastructure, improvement of efficiency across 
sectors.  In  relation  to  building  up  defence  capabilities,  the  plan  highlights  Spain's 
alignment with NATO commitments. 

Conclusion of the Commission’s assessment 

(41) 

Overall, the Commission is of the view that Spain’s plan fulfils the requirements of 
Regulation (EU) 2024/1263. 

OVERALL CONCLUSION 

(42) 

In  accordance  with  Article  17  of  Regulation  (EU)  2024/1263,  the  net  expenditure 
path as set in the plan should be recommended by the Council to Spain, and the set of 
reforms  and  investments  underpinning  the  extension  of  the  adjustment  period  to  7 
years should be endorsed. 

HEREBY RECOMMENDS that Spain 

1. 

2. 

Ensure  that  net  expenditure  growth  does  not  exceed  the  maxima  established  in 
Annex I to this Recommendation. 

Implement  the  set  of  reforms  and  investments  that  underpins  the  extension  of  the 
fiscal  adjustment  period  to  seven  years,  as  established  in  Annex  II  to  this 
Recommendation, by the indicated deadlines. 

In addition, the Council invites Spain to ensure the delivery of other reforms and investments 
responding  to  the  main  challenges  identified  in  the  context  of  the  European  Semester,  in 
particular in the CSRs, and addressing the common priorities of the Union.  

EN 

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Maximum growth rates of net expenditure 
(annual and cumulative growth rates, in nominal terms) 
Spain 

Years 

2025 

2026 

2027 

2028 

Growth 
rates 
(%) 

Annual 

Cumulative (*) 

3.7 

9.2 

3.5 

3.2 

3.0 

13.0 

16.6 

20.1 

(*) The cumulative growth rates are calculated by reference to the base year of 2023. 

ANNEX II 
Set of reforms and investments that underpins an extension of the adjustment period to 7 years 
Spain 

Tax 
Reform  
(RRP 
measure– 
C28.R3.38
8 and 
adding to 
RRP 
measure) 

1: 

Main objective  Description and timing of key steps  Monitoring indicator(s) 
Entry into 
force of tax 
reforms aiming 
at increasing 
government 
revenues and 
modernise the 
tax system. 

Step  1:  By  Q3  2023,  delivery  of 
milestones  388  of  Spain’s  RRP, 
permanently increasing government 
revenues by 0.3 % of GDP.  

Satisfactory 
Step 
fulfilment  of  milestones 
C28.R3.M388  of  Spain’s 
RRP.  Revenues  resulting 
unchanged 
from 
structure  of 
the  PIT 
between  2020  and  2028 
shall not be accounted for 
assessment of compliance.  

Step 2: By Q4 2025, delivery of an 
additional  permanent  increase  of 
0.1%  of  GDP  of  revenues  by  Q4 
2028,  totalling  a  cumulative  0.4% 
of GDP by Q4 2028. 

an 

showing 

Step  3:  By  Q4  2028,  delivery  of  a 
report 
the  permanent 
increase  in  revenues  between  2024 
and 2028.  

2: 

Step 
Annual 
report 
monitoring 
prepared  by  the  Ministry 
of  Finance  on  the  fiscal 
revenue 
of 
impact 
measures. 
In  assessing 
compliance with the 0.4% 
any 
of  GDP 
revenues 
increase 
resulting 
an 
unchanged structure of the 
PIT  between  2025  and 
2028 can be accounted for 

target, 

from 

in 

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up 
to  0.1%  of  GDP. 
Revenues  resulting  from 
an unchanged structure  of 
the PIT between 2020 and 
be 
2024 
accounted  for  assessment 
of compliance.  

shall 

not 

showing 

Step  3:  Delivery  of  a 
the 
report 
in 
permanent 
revenues of 0.4% of GDP 
target in line with Step 2. 

increase 

Entry into 
force of tax 
reforms aiming 
at increasing 
government 
revenues and 
modernise the 
tax system. 

To  strengthen 
the  evaluation 
of 
public 
spending 

Tax 
Benefits 
Reform  

(Adding to 
RRP 
measure  
C28.R2.M3
86) 

Spending 
reviews  

(Adding to 
RRP 
measure  
C29.R1) 

permanently 

By  Q4  2025,  delivery  of  milestone 
386, 
increasing 
government revenues by at least 0.1 
% of GDP. 

Satisfactory  fulfilment  of 
milestone  C28.R2.M386 
of Spain’s RRP. 

Step  1:  By  Q4  2021,  approval  by 
the Council of Ministers of the new 
cycle  of  spending  reviews  (2022-
2026) 
to 
AIReF. 

to  be  commissioned 

Step  2:  By  Q4  2026,  adoption  of  a 
the  Ministry  of 
new  cycle  by 
Finance  which 
an 
intervention for each spending area 
over the time frame of the Plan. 

envisages 

Step  3:  By  Q2  2027,  adoption  of 
reforms  resulting  from  completed 
and  ongoing  spending  reviews  and 
reducing  yearly  expenditure  by 
2028 by at least 0.1% of GDP on a 
permanent basis, contributing to the 
sustainability of public finance. 

Step 4: By Q1 2028, the publication 
of  the  annual  monitoring  report  by 
the  Ministry  of  Finance  on  the 

Step  1:  Provision  of  the 
agreement  of  the  Council 
of  Ministers  indicating  its 
entry into force. 

and 

Step  2:  Evaluation  plan 
prepared  by  the  Ministry 
of  Finance.  The  current 
(2022-2026) 
new 
cycles 
spending 
of 
reviews  would  cover  a 
spending  area  equal  up  to 
10%  of 
spending 
the 
allocated to policies under 
the direct responsibility of 
central administration. 

Step 3: Entry into force of 
the relevant measures; and 
copy  of 
impact 
assessment,  justifying  the 
permanent 
expected 

their 

EN 

19 

  EN 

 
 
 
 
 
 
 
 
 
 
of 

implementation 
public 
expenditure  reviews  will  include 
the  assessment  of  actual  yearly 
expenditure  savings  since  2025 
from the implementation of adopted 
spending 
following 
measures 
reviews. 
the 
shall 
achievement by 2028 of permanent 
yearly  savings  of  at  least  0.1%  of 
GDP against unchanged policies. 

show 

It 

concerned 

annual  and  cumulative 
savings  to  be  achieved  in 
the 
budget 
lines up to 2031 compared 
expenditure 
with 
projections  at  unchanged 
policies 
same 
the 
budgetary lines.    

the 

in 

Step  4:  Publication  of  the 
annual  monitoring  report 
prepared  by  the  Ministry 
of  Finance.  The  report 
shall  also 
the 
adoption  of  at  least  one 
action  per  spending  area 
to 
the  sustainability  of 
public finances. 

illustrate 

Satisfactory  fulfilment  of 
the 
RRP 
relevant 
milestone 376 (C27.R1). 

Satisfactory  fulfilment  of 
the 
RRP 
relevant 
milestones  190  and  191 
(C13.R1). 

Entry into 
force of the 
Law 
against Tax 
Evasion 
and Fraud 
(Existing 
RRP 
measure – 
C27.R1.M3
76) 

The objectives 
of this reform 
are to 
modernise the 
Spanish tax 
system to 
ensure tax 
fairness and 
increase the 
collection 
effectiveness 
of the tax 
system. 

Better 
regulation 
and 
business 
climate 
(Existing 
RRP 
measure – 
C13.R1.M1
90, M191) 

The objectives 
of the reform 
are to improve 
the framework 
in which 
economic 
activity takes 
place by 
ensuring a 
better 

to 

fraude 

By  Q2  2022,  entry  into  force  of  a 
law  against  tax  evasion  and  fraud 
(‘Ley  de  medidas  de  prevención  y 
fiscal’) 
lucha  contra  el 
which:   
-  Enlarges 
the  perimeter  of 
transactions  where  e-payments  are 
compulsory (firms & professionals) 
and  set  legal  thresholds  for  cash 
payments    
-  Updates  the  list  of  tax  havens 
according 
transparency,  no 
taxation  and  harmful  tax  regimes 
criteria.   
-  Implements  changes  to  the  rules 
for  listing  people  with  tax  arrears.   
- Implements a ban on “double-use 
software”.   
-  Introduces  a  reference  value  for 
the tax base in property taxation.   
Step  1:  By  Q2  2022,  entry  into 
force  of 
the 
‘Insolvency Law’. 
Step  2:  By  Q4  2022,  entry  into 
force of the new ‘Law on Business 
Creation  and  Growth’  to  simplify 
procedures for setting up a business 
to  promote  a  diversified 
and 
sources  of  finance  for  business 

reform  of 

the 

EN 

20 

  EN 

   
regulation and 
business 
climate that 
facilitates the 
creation and 
growth of 
businesses, and 
their 
restructuring if 
necessary. 
The objective 
of this measure 
is to strengthen 
the regulatory 
framework for 
the promotion 
of renewable 
generation, in 
order to 
increase 
certainty and 
encourage 
private 
investment in 
renewable 
energy, to 
remove 
barriers to the 
deployment of 
renewables 
and to improve 
their 
integration in 
the 
environment, 
the electrical 
system and 
into different 
sectors 
Enhance 
access to 
digital learning 
through the 
provision of 
portable 
devices to 
students from 
vulnerable 
groups in 
schools. Equip 

Regulatory 
framework 
for the 
promotion 
of 
renewable 
generation 
(Existing 
RRP 
measure – 
C7.R1.M10
2, M103, 
M104, 
M105, 
T106, 
T107) 

Digital 
Transform
ation of 
Education 
(Existing 
RRP 
measure – 
C19.I2.M2
89, M290, 
T291) 

Satisfactory  fulfilment  of 
RRP 
relevant 
the 
milestones  102,  103,  104, 
105  and  targets  106  and 
107 (C7.R1). 

growth.  

Step 1: By Q4 2020, 

•  Entry into force of Royal 
Decree Law 23/2020 
(energy measures) 

•  Entry into force of Royal 

Decree 960/2020 
(economic regime for 
renewable energy) 

•  Entry into force of Royal 

Decree 1183/2020 
(connection of renewables 
to the electricity grid) 

Step  2:  By  Q2  2021,  entry  into 
force  of  Law  on  Climate  Change 
and Energy Transition. 

Step 3: By Q4 2023, 

•  additional production 

capacity for renewable 
energy (at least 6000 MW) 

renewable 
cumulative  additional 
energy  capacity  installed  in  Spain 
(at least 6000 MW). 

Step  1:  By  Q4  2021,  approval  of  a 
programme  to  equip  public  and 
publicly  subsidised  schools  with 
digital tools. 

Satisfactory  fulfilment  of 
RRP 
relevant 
the 
milestones  289,  290  and 
target 291 (C19.I2). 

Step 2: By Q4 2025,  

•  completion of actions for 

the digital transformation of 
education, including the 
preparation or revisions of 

EN 

21 

  EN 

 
Dual 
vocational 
training  
(new 
measure) 

Deployme
nt of 
Scheme 20  
(new 
measure) 

interactive 
digital systems 
(IDS) 
classrooms to 
enable distance 
and blended 
learning, 
support the 
preparation or 
revision of a 
digital strategy 
and the digital 
training of 
teachers 
Promote the 
in-company 
training for 
student in 
vocational 
training 

Creation  of  a 
new  common 
framework that 
eliminates 
the 
of 
disparity 
administrative 
requirements 
between 
autonomous 
communities 
local 
and 
entities  and,  at 
the  same  time, 
reduces 
procedures,  in 
of 
view 

digital strategies in at least 
22 000 school and the 
digital training of 70 000 
teachers 

Provision  of  connected  digital 
devices 
in  public  and  publicly 
subsidised  schools  to  bridge  the 
"digital  divide",  and  equip  a 
minimum of 240 000 classroom 

Step  1:  By  Q4  2027,  complete  an 
awareness  campaign  reaching  at 
least 60% of all students that intend 
to  start  vocational  training  or  have 
started in  the past  6 months  a non-
and 
training; 
dual 
capacity  building 
in  providing 
vocational training to any company 
dual 
interested 
vocational training. 

vocational 

providing 

in 

Step  2:  By  Q4  2028,  provide  a 
monitoring  report  showing  that  at 
least 80% of all vocational training 
students  in  the  first  half  of  2028 
have  been 
in  dual 
vocational training 

enrolled 

impact  assessment 

Step  1:  By  Q4  2025,  approval  in 
(multi)sectoral  conference(s)  of  a 
sectoral 
(in 
cooperation  with  Autonomous 
Communities  and  City  Councils), 
areas 
which 
needing 
and 
simplification  of  procedures  across 
regions and local authorities. 

priority 
standardization 

defines 

Step 2: By Q2 2026, publication of 
a  Strategic  plan  for  the  sectoral 
conferences 
by 
conference(s). 
(multi)sectoral 
measures, 
specifying 

approved 

annual 

Step  1:  Produce  a  report 
on the scope and reach of 
the  awareness  campaign 
and 
capacity 
the 
of 
building activity. 

Step  2:  Copy  of 
monitoring report. 

the 

to 

the 
Step  1:  Link 
publication of the sectoral 
assessment 
impact 
approved 
by 
(multi)sectoral 
conference(s).  

to 

of 

the 
Sep  2:  Link 
publication 
the 
strategic plan approved by 
(multi)sectoral 
conference(s). 

Step  3:  Link 

to 

the 

EN 

22 

  EN 

 
 
  
 
 
supporting 
business 
activity. 

responsible  actors  and  monitoring 
indicators,  to  be  fully  implemented 
by 2027. 

publication of the report. 

and  proposes 

Step 3: By Q4 2027, publication of 
a 
the 
report  which  monitors 
implementation  of 
the  Strategic 
corrective 
plan 
measures in case of deviations. The 
report should also assess the impact 
already 
of 
implemented in previous years. 

measures 

the 

Step  1:  By  Q4  2026,  entry  into 
force of a royal decree establishing 
the 
information 
requirements of the system. 

technical 

and 

Step 1: Entry into force of 
the royal decree. 

Step 2:  By Q1 2027, establishment 
of  an  electronic  invoice  platform, 
managed by the Tax Agency, which 
will provide a basic, free service to 
all  companies  and  professionals 
who wish to use it. 

Step  2:  Copy  of  the  ‘acta 
de  recepción’  relevant  to 
the 
invoice 
platform. 

electronic 

the 

Development 
of 
mandatory 
B2B  electronic 
invoicing 
system. 
Establishment 
of a more 
secure and 
efficient B2B 
electronic 
invoicing 
system with 
the aim to 
shorten the 
average 
payment 
period and 
reduce tax 
fraud. 

Step  1:  By  Q4  2025,  signature  and 
entry 
into  force  of  partnership 
agreements  between  the  Ministries 
of  Health  of 
the  Autonomous 
Communities,  mutual  societies  and 
Social Security. 

Step  1:  Signature  and 
entry 
of 
partnership agreements. 

force 

into 

for 

the 

temporary 

Improve 
management 
of 
incapacity 
benefits 
common 
contingencies 
to  reduce  their 
expenditure for 
all 
public 
administrations 

Electronic 
Invoice  
(new 
measure) 

Measures 
to improve 
the 
manageme
nt of 
temporary 
disability  
(new 
measure)  

Simplificati Facilitate 

the  Step  1:  By  Q4  2025,  entry  into  Step 1: Entry into force of 

EN 

23 

  EN 

 
 
 
 
 
 
 
 
 
 
 
 
 
 
on of the 
system for 
the 
homologat
ion of 
diplomas 
(new 
measure) 

Reform of 
the work 
and job 
search visa 
system  
(new 
measure) 

recognition  of 
the 
professional 
qualifications 
and skills (with 
special  regard 
to 
university 
education)  of 
the 
foreign-
born 
population, 
increase 
productivity 
and 
contribution  to 
economic 
growth 

to 
their 

the 
Facilitate 
regular 
entry 
of working and 
job-seeking 
migrants, 
aimed 
improving 
migrant 
workforce 
productivity 

at 

Project 
Vienna 
(new 
measure) 

Increase 
supply 
affordable 
housing 

the 
of 

Entry into 
force of 

Strengthen  the 
regulatory 

of 

force 
legislation 
detailing 
the 
streamlined  processes 
for 
recognition  of  qualifications  of 
foreign-born population. 

the  legislation  facilitating 
the 
recognition  of 
the 
professional qualifications 
of 
foreign-born 
population. 

Step  2  (by  Q4  2028):  assessment 
monitoring  the  implementation  of 
the  reform.  The  report  should 
include  key  indicators  as  the  total 
number  of  applications  processed 
under  the  simplified  system  and 
average 
for 
homologation requests. 

processing 

time 

Step  2:  Publication  of  the 
assessment report 

Step  1:  By  Q4  2024,  entry  into 
force  of  a  royal  decree  regulating 
work  and  job  seeking  visas  for 
migrants. 

Step 1: Entry into force of 
a  royal  decree  regulating 
work  and 
job  seeking 
visas for migrants. 

Step  1:  By  Q4  2025,  launch  of 
tenders  to  provide  public  land  to 
private 
the 
construction  of  affordable  housing 
units. 

promoters 

for 

Step  2:  By  Q2  2026,  assessment 
monitoring  the  implementation  of 
the  reform.  The  report  should 
describe  the  evolution  and  impact 
of  the  project  and  include  key 
indicators  as  planned  houses  to  be 
developed, and total units of public 
land 
private 
promoters.  
Step  1:  By  Q2  2022,  entry  into 
force  of  the  modification  of  the 

transferred 

to 

Step  1:  Link 
the 
publication  of  the  call  for 
tenders. 

to 

Step  2:  Publication  of  the 
assessment report. 

1: 

Satisfactory 
Step 
fulfilment  of  the  relevant 

EN 

24 

  EN 

 
 
 
 
 
 
RRP  milestone 
(C17.R1). 

254 

improving 

Law  on  Science,  Technology  and 
the 
Innovation 
coordination among different levels 
of  government  of  science,  research 
and  innovation  policies,  enhancing 
the governance and coordination of 
the  Spanish  Science  Technology 
and Innovation system,  introducing 
a  new 
and 
scientific 
improving knowledge transfer. 

career 

the 
amendmen
t of Law 
14/2011 on 
Science, 
Technolog
y and 
Innovation 
(Existing 
RRP 
measure – 
C17.R1.25
4) 

framework  for 
science, 
the 
technology and 
innovation 
sector, in order 
to  enhance  the 
governance 
and 
coordination of 
sector, 
the 
create 
an 
attractive 
scientific 
career, 
improve 
knowledge 
transfer 
research 
applied 
products/servic
es 
the 
for 
society. 

from 
to 

and 
the 

Done at Strasbourg, 

For the Council 
The President 

EN 

25 

  EN