Palma.—Minister Josep Ignaçi Aguiló was making a comparison with the state of the finances of the Balearic Islands with those of Greece, saying that until the Partido Popular (PP) came to power earlier this year and introduced austerity measures to cut public debt, the region was heading along the same road to ruin as Greece .

Aguiló was speaking yesterday during a Parliamentary session in which PP Member of Parliament Mabel Cabrer asked to be informed about the measures that the Balearic government had adopted once its auditors had become aware of the true “catastrophic” state of the region's finances.

Complications
Aguiló described the financial situation which the PP had inherited from the previous high-spending coalition as “extremely complicated”. He said that at the end of June this year, the public deficit stood at 2.1 percent of Balearic gross product (PIB) at a time when the maximum authorised by Central Government was 1.3% of PIB.

Aguiló said that if the financial management of the region had continued along that course for the rest of the year, public debt would be at 4.2% of PIB, which, he added, would have been completely unsustainable.

The Minister said that when the PP came to power, and after an analysis of the finances, steps had been taken to eliminate all unnecessary spending and “rationalise” where government posts and subsidies were doubling up.

Aguiló said that the aim of the policy was to give the government's suppliers of goods and services the confidence to go on providing them at a time when millions of euros of invoices had remained unpaid.

He added that although the budget for 2012 was “austere,” it marks a turning point for the financial fragility of the Balearics.

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