The Government extends its aid plan for the economy but omits the direct aid claimed by the companies

The Government has announced the renewal and extension of the aid schemes launched with the hibernation of the economy last April, setting aside the request for urgent direct aid demanded by different business sectors due to the economic consequences of the second wave of the pandemic.

The Vice President of Economic Affairs Nadia Calvio has listed these measures after the Council of Ministers held today. Calvio has highlighted the extensions of the line of guarantees for 100,000 million euros of the ICO launched last April and of which companies have used a little more than 80,000 million. Also, the extension until next March of the moratorium on bankruptcy proceedings affecting companies in difficulty and expiring on December 31st. As protection for companies in sectors declared strategic, the administrative authorization requirement to make relevant investments in these companies is extended until next June.

In addition, the Council of Ministers has approved a credit supplement amounting to 6,000 million euros to balance the Social Security accounts against the expenditure that the “relief” measures and protection of income derived from the pandemic have entailed . And an extraordinary credit of 2,300 million euros so that the State Public Employment Service (SEPE) can face the higher expenditure on contributory benefits and subsidies derived from the temporary employment regulation files (ERTE) and other aid granted ongoing, such as subsidies for the unemployed who have lost the right to receive benefits or that of domestic workers.

The aid scheme for companies and workers that the Government has arranged to face the consequences of the pandemic has been pointed out as insufficient in recent weeks by both business organizations and the Bank of Spain.

Gerardo Cuerva, president of Cepyme, already warned last week that the current plan does not give hundreds of thousands of entrepreneurs a future. “More than half of the companies question their viability and no longer think about their survival but about when to close. And this is the stumbling block that must be overcome,” he indicated in reference to the General State Budgets that include tax increases for 2021 “that penalize companies.”

For its part, the Bank of Spain also warned a week ago that the usefulness that company and worker income protection schemes have shown to face the crisis unleashed in March begins to weaken as it continues the economic depression caused by the coronavirus. The exhaustion of economic prevention measures would thus lead to a transformation of temporary employment regulations, which affect 750,000 workers in layoffs that would reduce registered unemployment, which amounts to 3.8 million people.