In the midst of the debate on the reform of the regional financing model, the system continues to widen the differences between territories and has set a new record: the resource gap separating the best-funded community, Cantabria, from the worst, Murcia, is at historic highs. According to an analysis by the Fedea study center, the current scheme, which aims to guarantee similar quality public services throughout the country, allocated 3,372 euros per Murcian in 2024 — the latest available data — to be used for basic public services, almost a third less than what the inhabitants of Cantabria received. The difference is 977 euros, 2% more compared to the previous year’s results.
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The document, published this Wednesday with the title and prepared by the executive director of the center, Ángel de la Fuente, puts numbers to a deep-rooted problem. The current financing system, designed in 2009 and pending reform for more than a decade, has not evolved in line with the profound economic and demographic changes the country has experienced in the last 15 years. For this reason — and due to a series of mechanisms that distort the initial distribution — the financing differences have widened in recent years instead of moderating.
Evidence of this is that per capita resources from the system increased by 8.1% in 2024 — the data is presented with such a delay because the system has a two-year closing period — reaching an average of 3,666 euros, reflecting the sustained growth of activity and revenue that the Spanish economy is experiencing. However, the improvement did not serve to reduce the differences in distribution. Besides Murcia, the Valencian Community, Andalusia, and Castilla-La Mancha also received per capita funding below the average.
These four communities form the front of underfunded regions, with Murcia and the Valencian Community as the most affected, competing each year for the podium as the region that receives the least resources per capita. Their leaders, among the most vocal in demanding reform of the model, also call for a fund to compensate for the disadvantage caused by the financing system, arguing that much of their large debt is due to needing to borrow money to provide public services under conditions similar to other territories.
At the other end of the list are Cantabria and La Rioja, which in 2024 received 4,349 and 4,114 euros per capita, respectively, that is 683 and 448 euros above the average, according to the Fedea study. Extremadura and the Balearic Islands also received more than 4,000 euros per inhabitant, although only the latter is a net contributor to the system, while the former receives much more than it contributes to the common fund.
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Madrid contributes almost four times more than Catalonia
The financing system is built around a complex system of funds. To simplify greatly, the communities contribute money to a common fund based on their tax capacity — where the State also provides resources — resources that are initially distributed according to a spending needs formula, that is, how much it costs each region to provide basic services based on its adjusted population, which is the actual number of inhabitants weighted by variables such as aging or school-age youth. Then other adjustment criteria come into play, which according to academics are not very transparent and are responsible for distorting the distribution of a model already affected by lack of updating.
The ultimate goal of the system is to ensure that all citizens, regardless of whether they live in a rich or poor territory, have access to fundamental public services — whose provision is entrusted to the communities — of similar quality. Therefore, communities with greater tax capacity, where higher incomes are concentrated and there is more economic activity, are the main contributors to the system, with Madrid leading, followed by Catalonia and the Balearic Islands.
The Balearic Islands contributed 413 million to the common fund in 2024 and received resources well above the average. Madrid, for its part, contributed 8,681 million, almost four times more than Catalonia’s 2,315 million, and both received resources around the average — 3,676 euros per inhabitant for the former and 3,759 euros for the latter — figures that have become another element of the controversy that always surrounds the financing system and have resurfaced now that a proposal to renew the system is on the table.
The Ministry of Finance has presented a draft promising 21 billion more to the common fund and will discuss it with the communities in September, although it is unlikely to succeed. Not only have most regions expressed their rejection of the initiative, as it stems from a prior agreement between the Socialists and the ERC separatists, but the Government, at least for now, does not have enough support for it to prosper in Congress.
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