The drop in income and the ban on resorting to loans to finance investments has left the Island Council in a difficult position when it comes to drawing up the budget for next year. General Services Councillor, Biél Subirats, stated last week that the only solution was to make a concerted effort to reduce costs.
Specifically, the Island Council's resources will drop by between 5% and 6% compared to this year when the total available was 98.5 million euros. Nevertheless, Subirats stressed that the forecast figures are only a guideline and that his department is currently working on preparing the budget which it is anticipated will be approved before Christmas.
The Councillor stated that the aim of the 2011 public accounts was to guarantee programmes of a social nature and provide financial aid for the island's leading sectors, such as the production of shoes and fashion jewellery.
Subirats also affirmed that efforts would be made to optimise to the maximum the resources available. Thus, there will be a reduction in the budgets for those programmes or services which could operate with less finance without affecting the final result seen by the citizen.
According to the Councillor, the great majority of planned investments will be included in the 2011 budget, the drop in resources not affecting investments as much as had originally been anticipated. He explained that the major projects are guaranteed whilst the remainder of priority investments would have to be financed from the Island Council's own resources, "the projects that cannot be financed through our own resources will not be included in next year's public accounts because we do not have the option of resorting to a loan".
Subirats stressed the need to make an effort to support productive investments that would benefit the economy and that would help to shape a new line of production, adding that it was a case of squeezing the most out of the small amount available to the institution. He pointed out that the Island Council was unable to generate income and thus depended heavily on other institutions, especially the State and Balearic Governments.
But extra 237 million for the Health Department
In order to meet outstanding bills from suppliers, the latest complaints regarding unpaid debts being from the chemists, the Balearic Government has been obliged to provide an extra 180 million euros for the Department of Health and increase the budget by 5%. An extra 57.7 million euros will also be needed to cover running costs, bringing the total to 237.5 million euros.
In order to finance this additional sum, the Balearic Government has had to issue public bonds, the majority of which have been taken up by insurance companies and financial and investment firms in Spain and abroad.
An agreement reached with the Official Balearic College of Pharmacists will see 30% of the outstanding October and November invoices paid to the pharmacists. In Menorca alone the amount owing is 4.5 million euros (which will be reduced to 3 million with this payment), whereas in the Balearic Islands as a whole 12.5 million euros will be settled, leaving the debt owing at the end of the year at 29.5 million euros.
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