Spain’s poisonous slush fund
scandal
Editorial: Rajoy
should come clean on party financing practices
Mariano Rajoy, Spain’s
prime minister, swept into office in November 2011 after his conservative
Popular party won its biggest election victory of the post-Franco era. Few
European politicians then boasted a more convincing mandate for the type of
fiscal, economic and financial sector reforms required to rebuild his country’s
prosperity and protect its eurozone membership. Twenty months later, however,
the political capital generated by Mr Rajoy’s triumph is a fading memory,
thanks to a festering party finance scandal from
which he has culpably failed to draw the poison.
Week by week, month by month, the scandal is
damaging Mr Rajoy, slowing his government’s reform efforts, undermining Spanish
democracy and corroding Spain’s international image. It is true that the
premier is under little pressure to resign, in the sense that no irrefutable evidence
has emerged to disprove his contention that he has never received illegal cash
payments from a slush fund operated by Luis Bárcenas,
a former PP treasurer. Mr Rajoy’s party commands a comfortable parliamentary
majority and remains, for the most part, loyal to him. Meanwhile, the
opposition Socialists sense they are too unpopular to profit from an early
election.
But for Spain’s sake Mr Rajoy’s premiership needs
to be about far more than personal political survival and belated denials of
wrongdoing. His refusal to appreciate that the ever-widening scandal demands a
full explanation of the PP’s financing practices, past and present, is eroding
public confidence in his leadership. It is also draining respect for the
political party system established after Franco’s death in 1975. Spaniards
justifiably regard it as unacceptable that their rulers should raise taxes,
reduce public spending and let unemployment rise to catastrophic levels, while
scorning the need to come clean about their parties’ receipt and use of huge
sums of money.
This is by no means the first party or government
financing scandal in post-Franco Spain. The Filesa affair of the 1980s cast the
Socialists in a poor light, as does an embezzlement case under judicial inquiry
in the southern region of Andalucia. But the context of the PP scandal is
different, making it dangerous for Mr Rajoy to persist with his dilatory and
obfuscatory tactics. Not only are the Spanish economy and banking system in
their most feeble condition since the return of democracy in the late 1970s,
but Spaniards are unhappy that certain pillars of the post-Franco state, such
as the monarchy, the judiciary and the autonomy statutes of Spain’s 17 regions,
are not functioning as efficiently and as clearly in the public interest as they
should.
Regional tensions are most acute in Catalonia,
where separatism is strong, but the central government in Madrid faces
resistance to its fiscal and economic reforms in other regions such as the
Basque country and the Canary islands. The slush fund revelations are weakening
Mr Rajoy’s legitimacy at precisely the moment when he most needs it. For
without public trust and support, the reforms required to strengthen Spain’s
economy and stabilise the eurozone will be paralysed.
As matters stand, it is Mr Bárcenas who, by means
of a drip-feed of leaks about the slush fund, is dictating the terms on which
Spain’s legal system and citizens learn about the scandal. Yet he is a man who
is not noted for his veracity and is under investigation for tax evasion,
bribery, fraud and other offences.
The present sequence of disclosures followed by
denials, and then by more disclosures, undermines the political stability that
Mr Rajoy claims to embody. It is imperative for Spain’s prime minister to
appear before parliament and speak the truth about what he knows.