Spanish National Crash Plan includes 20 cents per litre discount on petrol for all users

by Lorraine Williamson
Spain responds with a €16 billion national crash plan - image from official La Moncloa Tweet - https://twitter.com/desdelamoncloa/status/1508777842913517577/photo/1

MADRID – Prime Minister Sánchez of Spain has proposed a package of measures worth a total of €16 billion. The measures together form the National Crash Plan to alleviate the economic consequences of the war in Ukraine. 

The plan will be discussed by the Council of Ministers on Tuesday. Of the total amount, €6 billion will go to direct aid and tax relief. Furthermore, the government wants to spend the remaining €10 billion on ICO loans for companies. Consequently, the parliament will validate the new decree within a maximum period of 20 days. 

Government asks parties for “unity” and support 

The president took the opportunity to demand “unity” from all political parties and to demonstrate “patriotism” by supporting the government in this regard. Government sources explain that extensive consultations have taken place with spokespersons for all groups to set out the general outline of the plan. 

Sánchez explained the plan at the conference he gave at the III Generation of Opportunities Forum. This was organised by Europa Press and McKinsey. And was two days after the European Union granted Spain and Portugal an exception to limit the price of gas, decoupling it from the price of electricity. 

Pillars of the national crash plan 

The shock plan will be in effect until June 30 and has five pillars: 

  • Help for families and workers
  • Supporting the business fabric 
  • Support for the transport sector 
  • Cybersecurity 
  • The energy sector 
  • Bonus 20 cents per litre of fuel 

The first section includes the bonus of 20 cents on every litre of fuel for all users. In addition, ERTEs can again be activated to prevent redundancies and thus protect employment. 

Housing and IVM 

Furthermore, in the area of ​​housing, rents may only be adjusted upwards by a maximum of 2%. In addition, the amount of the minimum vital income (IVM) will be increased by 15% for three months. The social allowance for electricity will be extended to 600,000 households and will reach 1.9 million households. In addition, the extension of the tax measures that apply to the electricity bill until 30 June. 

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ICO guarantee 

To support companies, in addition to the new line of ICO guarantees, the return period for existing credits is being extended. The government will approve a special aid package of €362 million for the agricultural and livestock sector and another €68 million for the fisheries sector. €500 million will go to the energy-intensive industry to compensate for 80% of the toll. 

Transport sector 

Just over €1 billion will be injected into the transport sector. Carriers will also benefit from the bonus of 20 cents per litre of fuel and will receive direct support, depending on the type of vehicle, for a total of €450 million. 

Distribution of financial aid 

Moreover, the use of these financial aids is as follows: €1,250 per truck; €900 by bus; €500 by van and €300 by taxi, VTC, or ambulance. In addition, the period for repaying the tax on hydrocarbons will be shortened from three months to one month. In addition, the commitment is maintained to pass a law that allows carriers to operate at a fair price. 

Cyber ​​security 

In the field of cybersecurity, the General Government is setting up an Operations Centre and strengthening the security of the 5G network. €1 billion has been earmarked for this. 

Price of energy in homes 

Also, the government seeks to lower the final price of energy in homes and businesses. To this end, along with Portugal’s government, a presentation will be made this week to the European Commission proposing to set a reference price for gas used to produce electricity. 

Likewise, the specific compensation regime for the production of electrical energy from renewable energy sources, cogeneration, and waste is being updated. Therefore, this means a reduction in system costs for electricity by 2022 to 55% for a total value of €1.8 billion. 

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