Zaragoza continues to be the big city with the most debt per inhabitant and barely reduced it in 2020

Zaragoza slowed down the rate of debt reduction in the year of the covid-19 pandemic. The drop in income, the lack of state aid and the burden borne by the City Council for pending convictions stopped the process of absorbing the long-term debt in which the city has been embarking since it reached its historical record in 2015, with 1,070 million euros. One more year, The capital will continue to be the municipality of more than 500,000 inhabitants with the most debt per person: 1,028.04 euros, almost double that of Madrid.

The data is collected in the latest report on local corporation debt published by the Bank of Spain, which figures that of the Zaragoza City Council in December 2020 at 701 million euros, of which 128 correspond to the tram concession. In absolute numbers, the Aragonese capital is only surpassed by Madrid (1,950 million) and Barcelona (801). They are 5 million less than the same month of 2019, so the debt reduction is only 0.7%. Without taking into account the impact of the north south line, the reduction would be 9 million euros.

This is a minimum percentage if the evolution of the debt in recent years is taken into account, especially in 2019, when after the entry of the PP-Cs coalition, an agreement was reached with the Ministry of Finance to set a new calculation of what the tram concession means in municipal liabilities (it went from 189 to 124 million, 65 less).

What’s more, the government undertook an extraordinary repayment of loans that replaced the debt below the legal limit of 110%. This meant a relief in the accounts, which saw their commitments to the banks reduced by 149 million, from 855 to 706, 17%. It was a decline in historic debt.

Court judgments

But in 2020 the path of debt reduction has been halted both by the pandemic and by various economic conditions adverse inherited by the government PP-Cs: the first are the bank loans that had to be raised in 2020 to pay court judgments, as allowed by the Impulso plan enabled by the State for this purpose.

As explained by municipal sources, Although 45.5 million were amortized in loans, it was necessary to increase the indebtedness by 25.4 million to attend inherited judicial decisions of previous governments. In addition, PP-Cs had to satisfy price revisions of large contracts that had been creeping and this generated a short-term debt of 9 million.

Finally, the mixed company of the tram made in 2020 replacements worth 7 million euros, which the Ministry of Finance imputed as greater debt. This is what has caused that the part of the ballast that corresponds to the mentioned concession has gone from 124 to 128 million. The Councilor for the Treasury, María Navarro, highlighted the management effort developed to reduce the debt despite the “hole” that was found when she acceded to the government and in a context of a pandemic, with a fall in income of 35 million. Stressed that since PP and Cs govern, it has dropped 130 million, reaching the lowest figure since 2009.

Above Madrid

With its 1,028 euros, Zaragoza continues to be the big city with the most debt per inhabitant. Madrid follows a long way: if its 1,950 million euros of debt are distributed among its 3.3 million registered residents, the result is 584.75 euros. The capital of Spain has been the one that has reduced its debt the most in recent years, 59% since 2015, compared to 34% in Zaragoza, which has gone from 1,070 million to 701 million.

The third city in debt per inhabitant is Malaga, with 548 euros (the total debt is 317 million). In Barcelona, ​​the average is 489.3 euros, with a total of 801 million. Valencia follows, with 362.40 euros and a volume of long-term loans of 290 million. By last, Seville computes commitments with banks totaling 237 million euros, that is, 342.78.

The percentage of debt reduction in the Aragonese capital (0.7%) is the second lowest of the five large cities. Only Barcelona chose to raise its debt, from 782 million to 801. But the other three cities applied strong debt reductions despite the pandemic, especially Seville, which decreased its slab by 22% in one year and Valencia, by 20%. In Madrid, the reduction was 12.2% and in Malaga, 8.9%.

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