Coming Home to Roost

You would have thought that after the Central Government forwarded funds to town halls so that they could pay off their debts to local traders, they would be almost without debt… but you would be wrong.

The city of Granada, for example owes, 217,757,000 euros, or in other words, on the way to 218 million euros. Motril has a debt of 32.8m euros and Salobreña, 13.1m euros.

On the other hand, Otívar, Itrabo, Lentegí and Lecrin, like many small villages, have zero debt.

Another way of looking at it is the debt to population ratio: La Taha, has a debt of 1.7m euros and a population of 778 inhabitants, which works at at 2,273 euros per head, compared to Salobreña, with 12,622 inhabitants, the ratio is 1,045 euros per head.

If you want it in more global terms, as a whole, the town halls in the province of Granada owe 551m euros to the banks, yet 18 of them owe nothing. And if you really want a sleepless night, the total owed to banks by all of Spain’s town halls amounts to 35,290m euros.

So, is the total provincial debt going down? Nope. Since 2008 it has gone up a staggering 71%. In fact, just between 2011 and 2012 it went up by 192m euros.

Town halls like Sorvillan need bank loans to cover the cost of rubbish collection and public electricity bills. So we’re not talking about borrowing to pay for macro social projects (to attract votes) but just to be able to pay the running costs of these vote-winning social projects, which is why some towns are now trying to sell off their public sports facilities because they can’t pay to maintain them with the little use that they get. Of course, putting the fees up is out of the question but the townsfolk are broke and the furore would last until the next local elections.

Editorial Comment: Of course, each town puts the unsustainable debt down to being “inherited;” i.e., that the previous administration saddled them with it, but as the culprit changes according to the town, the only conclusion is that local politicians of all shades have irresponsibly overspent as if there were no tomorrow.

(News: Province of Granada)

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