Palma.—With Spain's autonomous regions being partly to blame for the country's financial crisis, central government intends to modify how local authorities work in an attempt to scale down the vast level of local government which the Minister for Finance is confident will save millions every year.

With the government of Valencia already having asked for a bail out this week, the Balearic government claims that the region is solvent and financially solid but never the less, Balearic politics is heading for another major shake up.

Under the new “Montoro Plan” the Council of Majorca, which has already been slimmed down, is now going to have to take on a much greater work load by being responsible for the basic amenities and services of local councils in Majorca with a population of less than 5'000 inhabitants.

The plan is to be introduced nationwide but here in Majorca it means that the Council of Majorca and its President, Maria Salom, will quite simply be in charge of running 25 local councils.

Montoro has estimated that such a move will save the Balearic government some 70 million euros per year while at a national level, a saving of 2'248 million euros will be made.

Backing up his decision, Cristobal Montoro has forecast that Spain's recession will drag on into 2013, although the economy will not be quite as weak as it is now.

According to the latest figures, the country's gross domestic product is expected to contract 0.5 percent in 2013, compared with the previous forecast for it to grow by 0.2 percent hence why further cuts and austerity measures need to be introduced.

So, for example, the Council of Majorca is going to be responsible for water, waste collection, telephone services and electricity amongst other services, in the smaller councils. Health and education will be taken over by the Balearic government.

The Montoro Plan also includes the reduction of the number of local councillors which mean that come 2015, there will be 200 in Majorca and central government will set local mayors' wages depending on the number of inhabitants. The number of local advisors will also be capped.

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