The Council of Ministers has approved a Royal Decree-Law (Royal Decree-Law 8/2020, of March 17, on extraordinary urgent measures to address the economic and social impact of COVID-19) with the largest mobilization of economic resources in the democratic history of Spain to face the economic impact of the coronavirus.
It has been decided to mobilize around 20% of GDP, 200,000 million euros with measures to protect and support families, workers, the self-employed and companies.
The objective is to begin the recovery as soon as the health emergency is behind us, relaunching our economy, our production and our employment and ensuring that the fall is followed by an economic recovery and not by stagnation.
The Government supports the most vulnerable
The first block of measures of the Royal Decree-Law approved by the Council of Ministers is intended for the elderly, dependents and vulnerable families.
- In this section, 600 million euros are allocated to the financing of basic benefits of the corresponding social services of the autonomous communities and local entities, with special attention to home care for elderly and dependent people.
- In addition, protection is extended to energy and water supplies, guaranteeing essential public services. As a novelty, telecommunications services are also guaranteed. All this for vulnerable families.
- The right to housing is also guaranteed for people with the most difficulties. To this end, a moratorium is established on the payment of mortgage payments for mortgage debtors in a situation of special vulnerability who see their income reduced. The purpose is that no person in a difficult economic situation loses their home.
The Government accompanies companies that do not lay off
The second block of measures reinforces employment protection to prevent a temporary crisis like the current one from having a permanent negative impact on the labor market. To this end, the Government has agreed that:
- Salaried workers can adapt or reduce their working hours, even up to 100%, to address the conciliation and care needs derived from this crisis.
- Teleworking is established as the main flexibility measure, when circumstances allow it.
- Temporary staff adjustments will be promoted through the flexibility of Temporary Employment Regulation Files.
- The ERTES caused by the Coronavirus crisis will be considered force majeure and workers will have the right to contributory unemployment benefits, even if they do not meet the required prior contribution requirement. The collection of this benefit will not be counted for the purposes of subsequent collection of unemployment benefit.
- In the case of ERTEs, the employer will be exempt from the business contribution of Social Security contributions.
- For the self-employed group, access to cessation of activity will be made more flexible so that they can quickly collect a benefit in case of economic difficulty.
The Government addresses temporary liquidity problems of companies
The third block of measures ensures the liquidity of companies so that they can remain operational with the aim that a liquidity problem does not become a solvency problem.
- The creation of a line of public guarantees and guarantees worth up to 100 billion euros is approved. This will make it possible to mobilize between 150,000 and 200,000 million euros. The State will be the guarantor of the operations.
- In addition, additional lines of guarantees of 2,000 million euros are approved for exporting companies with agile mechanisms, especially favoring small and medium-sized companies.
- On the other hand, Public Administrations will help their contracting companies to mitigate the consequences of COVID-19 on public sector contracts. A specific regime for the suspension of public contracts will be established, with extension of deadlines and compensation of salaries, in order to avoid the termination of contracts and the consequent loss of employment.
- To support the productive and business system, the Government is also reforming the regulations on foreign investments, to prevent companies from countries outside the European Union from gaining control of Spanish entities in strategic sectors, taking advantage of the temporary drop in the value of their actions in this situation of economic crisis.
The Government mobilizes resources to develop a vaccine
The Government is also committed to strengthening scientific research for the development of a vaccine or cure for COVID19.
- 30 million are dedicated to research. This money will be dedicated to providing the Higher Council for Scientific Research and the Carlos III Health Institute with the necessary resources to face this health emergency.
FULL TEXT OF THE ROYAL DECREE HERE
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