A broader budget to tackle the social emergency and boost the economy in 2021

For the second year running, the proposal for the municipal budget anticipates increased expenditure and investment to tackle the social emergency and boost economic activity in the city. Going into 2021, the municipal budget would be for a record 3,231 million euros, a 6.5% increase on current spending.

06/11/2020 19:20 h

Ajuntament de Barcelona

Income conditioned by Covid-19

The budget is affected by two factors. Firstly, the freeze on municipal taxes and the 75% drop in the tax on terraces, set out in municipal by-laws and meaning a drop in locally generated revenue for the municipal coffers. Secondly, the growth in special contributions from the Spanish state and the suspension of tax rules, allowing the use of carryovers and borrowing.

More spending and more investment

Current expenditure will reach 2,415,5 million euros, some 1.3% more than the present budget.

Investment will hit an all-time high of 794,4 million euros, which includes the outlay for the Municipal Investment Plan (PIM), up by 30%, and the budget to be executed by the Barcelona Municipal Institute for Housing and Renovation (IMHB) and the company BSM.

Notable budgetary items include:

  • The construction of social housing to boost the public housing stock, a priority for the municipal government (190,9 million).
  • The transformation of public space to combat the climate emergency and continue moving forward in the design of a more people-friendly city (158,7 million).
  • An extraordinary reserve of 130 million euros to cover the city’s needs post-Covid.

Municipal groups will start negotiating the proposal to achieve the broadest possible consensus. It will then be subject to initial approval by the Commission for Economy and Tax in November before its definitive approval in the full council meeting of December.