17-POINT PLAN TO BEAT THE CREDIT CRUNCH

PALMA
THE Balearic government announced that is going to introduce a new 17-point plan to reduce government expenditure and increase investment in public works in order to help create new jobs.

The cost-cutting plan, the small print of which has still yet to be finalised, was unveiled by President Francesc Antich who also pledged that 1'500 million euros is going to be pumped in to public works this year and that 58'000 new jobs will be created as a direct result.

Antich announced his government's 100-million euro saving scheme after a meeting of the Balearic Economic watchdog committee yesterday morning.

NO TECHNICAL RECESSION
He also said that extra financing is going to be set aside to help the poor and needy during the credit crunch - which the Balearic Minister for Finance, Carles Manera, maintains still cannot be “technically” considered a recession here in the Balearics. But, Antich is not going to go as far as slimming down the size of his government, as called for by the opposition, in order to save money. Much of the cash is apparently going to come from central government coffers.

However, new tax breaks for young people and large families are also going to be made available. Manera announced that a new Public Sector Law is going to be introduced to ensure much stricter management of public funds and eradicate political corruption.

Yesterday's retail figures (see over page) revealed that the Balearics has suffered the sharpest downturn in Spain during the first quarter indicating that consumer confidence has hit rock bottom.

President Antich has been under pressure from local union bosses and the opposition Partido Popular since last winter to take action to confront the credit crunch and honour the pledge he gave in July last year that he would take “urgent action.” “TOO LITTLE, TOO LATE” Union bosses yesterday said that the government's 17-point plan may be “too little, too late” now that there are over 110'000 people out of work in the Balearics and the start of the “job-saving” summer tourist season considerably delayed leading to a significant downturn in trade and takings in the service sector.

The unions maintain that job creation has got be paramount in order to lift people's confidence and get them spending again in order to safeguard existing businesses and jobs.

The PP fear that the 17-point plan could be all talk but little substance and wonder if central government is going to help provide so much public funding.