% of total expenditure, social security for 32 %, regional government for 34 % and local government 12 %. thus, 46 % of public expenditure was by regional and local government. with this structure of public expenditure, the setting of budgetary objectives for the various political and administrative tiers, on one hand, and the monitoring of their fulfilment, on the other, are two sides of the same coin. both are fundamental in building the credibility of budgetary policy. let me mention here what i consider to be an extremely significant advance. at the end of october the ministry of financial affairs and public administration began to publish for the first time, as a result of the commitments made under the stability law, monthly data on the regional government budget outturns. as these figures become available regularly, in accordance with the related law, the task of monitoring regional government expenditure will be made immensely easier. this is fundamental for the timely detection of any slippage from stated budgetary objectives and for standing ready to respond appropriately. it should also be noted that in the past few weeks a good number of regional governments announced their budgets for 2013, although it is still early to make a full diagnosis of overall regional government expenditure. these developments remedy some of the weaknesses in the information available for assessing the budgetary adjustment scheduled for 2013. even so, the fact that the presentation of the various budget documents by the various governments is not formally coordinated makes the work of analysts harder, given that, obviously, what matters from the macroeconomic standpoint or for the analysis of public finances is general government as a whole. the state and social security budget for 2013 let me now turn to the essential features of the state and social security budget for 2013, beginning with a reference to the budget outturn in 2012. the budget deficit is being reduced this year in very adverse economic and financial circumstances. indeed, as a result of the risks of possible slippage, a series of supplementary fiscal measures were adopted for the 2012 budget. their effects have begun to be perceived only in the second half of the year. notwithstanding, on the information available, the possibility of slippage can still not be ruled out. meeting the target will depend on the numerous tax measures taking effect in the last quarter of the year ultimately yielding the expected returns, and on that offsetting the growth of debt service payments, unemployment benefits and pensions. given the importance of meeting the deficit target in 2012, it should be foreseen that possible slippage in certain

the beginning of the second phase of reform, which rests on three basic pillars : the banking union, further fiscal integration and greater economic policy coordination. as to the ecb, it has contributed to providing stability to the euro area both through its more conventional remit, i. e. setting interest rates, and through its less conventional facet, namely supplying exceptional amounts of liquidity through unorthodox channels. but the roots of the current crisis in the euro area are not of a monetary nature and, consequently, monetary policy alone cannot resolve those problems. monetary policy can, however, provide more time for the remedies aimed at resolving the underlying problems to be effective. on 2 august the governing council of the ecb adopted a new non - conventional measure : the so - called outright monetary transactions. this programme of purchasing government bis central bankers ’ speeches debt on secondary markets, subject to compliance with certain macroeconomic conditions, aims to repair the monetary policy transmission mechanism, thus ensuring that the effects of the expansionary conventional measures adopted from the onset of the crisis reach european households and firms alike, irrespective of their country of residence. this ecb decision has had a stabilising effect on markets and eased the pressure on the spanish economy, although financial conditions remain very tight and uncertainty continues to weigh on households ’ and firms ’ spending and investment decisions. as stated, euro area measures should contribute to restoring the transmission channels of monetary policy and, thereby, reduce financial tensions. they should also help to sever the problematic public finances / banking system feedback loop, a vicious circle which contributes to prolonging the climate of uncertainty and makes it difficult to resolve the problems facing the euro area. nevertheless, it should not be forgotten that the scope of these actions is limited and that definitively overcoming the crisis in spain will depend on the progress achieved in other domains, including those which depend on our own economic policy. the spanish economy the challenges facing the spanish economy are well - known : reducing its high dependence on external financing, sustainably correcting the budget imbalance and strengthening the drivers of medium - and long - term growth through substantial and lasting improvements in competitiveness. naturally, completing the clean - up and restructuring of the banking system is also a key factor in this strategy, and i will briefly refer to this later on. significant steps have been taken in addressing these challenges. nonetheless, the ongoing adjustment of the spanish economy is at a delicate juncture, since there are no perce