SPANISH ECONOMY AND EMPLOYMENT STIMULATION PLAN CURRENT SITUATION SUMARY www'plane'gob'es

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SPANISH ECONOMY AND EMPLOYMENT STIMULATION
PLANCURRENT SITUATIONSUMARYwww.plane.gob.es
Extraordinary Council of Ministers 6 May 2009
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Spain joins the international coordinated
reaction in the area of fiscal policies
Spain is one of the countries that have made a
greater fiscal effort, as compared to the other
main developed economies and to other EU countries
APPROXIMATE COST OF THE DISCRETIONAL
MEASURES 2008-09 ( GDP)

• Considering the temporal and the permanent
  measures implemented so far, the discretional
  policies amount to 2.3 of the Gross Domestic
  Product in 2009, which places us in the first
  position in the EU
• This adds up to the effects of social policies
  upon the crisis (automatic stabilizers), which
  amount to 4.9 in Spain (53,000 million Euros)
  and 3.3 in the EU-27.

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Economic reaction the Plan E
The Plan E consists of 99 measures (91
implemented during the current legislature and 8
during the previous one) intended to make up for
the effects of the economic crisis upon familes
and companies and to resume growth and employment
creation
1st AXIS SUPPORTING FAMILIES AND COMPANIES

• 2nd AXIS ENCOURAGING EMPLOYMENT

• 3rd AXIS FINANCIAL AND BUDGET MEASURES

• 4th AXIS MODERNISATION

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1st AXIS. SUPPORTING FAMILIES AND COMPANIES
Measures to increase the liquidity of companies
and to encourage employment
Improving households available income

• Tax reduction
• Eliminating the Property Increment Tax
• Reducing the Income Tax up to 400 deduction.
• Supporting housing acquisition
• ? Extending the mortgage periods up to 2 years at
  no cost.
• ? Extending the housing acquisition period with
  Mortgage Accounts.
• ? Mortgage payment deferment.
• ? Anticipating fiscal deductions for habitual
  dwellings.
• ? Extending the fiscal period to sell habitual
  dwellings up to 2 years.

• Generalising the monthly VAT return.
• Special Conditions for the deferment of the
  Social Security fees for those companies that
  preserve employment.
• Adapting tax payment deferments
• Reducing the default interest type
• Increasing the deferrable amount with no need for
  guarantees.

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1st AXIS. SUPPORTING FAMILIES AND COMPANIES
Strengthening social policies in 2009

• Minimum pensions ?6 average 2,600,000
  beneficiaries
• Minimum Salary ?4 until reaching 624.
• Scholarships to grant access to education ?6
  of scholarship budget for 2008 1,575,000
  beneficiaries, approximately, 100,000 more than
  the previous year.
• More resources from the State Budget for the
  System of Attention to Dependence ?79 up to
  1,558 million Euros.

BENEFICIARIES OF THE AIDS FOR DEPENDENCY
700.000
628.000
650.000
600.000
566.000
526.000
550.000
500.000
445.600
450.000
400.000
350.000
300.000
2008
jan-09
feb-09
mar-09
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1st AXIS. SUPPORTING FAMILIES AND COMPANIES
Increasing the number of ICO operations, with
more than 145 thousand beneficiaries

• We have set forth the most ambitious set of ICO
  actions in history
• 50,000 million Euros to enhance financing for
  companies, self-employed workers and families.
• Most of them are already working satisfactorily.
• So far this year more than 5,700 million Euros
  have been invested and the number of
  beneficiaries has tripled.
• A new ICO guarantee line for Municipalities
  amounting to 3,000 million Euros has been
  implemented.

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• 1st AXIS SUPPORTING FAMILIES AND COMPANIES

2nd AXIS ENCOURAGING EMPLOYMENT

• 3rd AXIS FINANCIAL AND BUDGET MEASURES

• 4th AXIS MODERNISATION

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Local Investment Fund

• 30,772 authorised projects have been endowed with
  funds amounting to nearly the whole budget of the
  Plan (7,999 million Euros)
• 19,178 projects, that is to say, 62 of the
  approved projects, have been partially paid.
• The projects that have already been partially
  paid have served to create 240,289 jobs, 86 of
  the total job forecasts and 92,017 of those jobs
  are new contracts.
• The amount of workers finally included in the
  bids is 50 higher than the amount initially
  included in the applications.

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Fund for Economy and Employment Dinamisation

• 3,000 million Euros have been invested in
  employment creation in strategic sectors
  (Research and Development, the vehicle sector)
  and in environmental and public infrastructure
  improvement works

• Actions in the vehicle sector

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2nd AXIS ENCOURAGING EMPLOYMENT
Measures to Keep up and Encourage Employment and
to Improve Protection
8 specific measures
Extraordinary Plan for Vocational Guidance and
Training and Job Placement
1,500 allowances to hire unemployed workers with
family responsibilities and for women who have
been victims of gender violence
5,629 Contracts have been endowed with this
allowance since last December.
Enhancement of the Unemployment Subsidy
Capitalisation in order to promote Self-Employment
14,000 New self-employed workers thanks to this
measure in just five months.
Strengthening of the Public Employment Services.
Improvement of subsidy payments and labour
intermediation.
1,415 new professionals in the records of the
State Employment Services in 2008 and 900 in
2009.
2009 Employment Plan concerning Social Work.
Allowances to indefinite hiring
Promoting part-time contracts
Eliminating the 1-month waiting period to start
receiving an unemployment subsidy in the case of
people who are already receiving a taxable
pension
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2nd AXIS ENCOURAGING EMPLOYMENT
Measures to Keep up and Encourage Employment and
to Improve Protection
Further measures
State Housing and Refurbishment Plan 2009-2012.
Including Plan RENOVE Housing
The budget for this plan amounts to 10,188
million Euros and it will serve to grant loans up
to nearly 34,000 million Euros
400 million Euros of the ICO line have already
been used up
Plan RENOVE Tourism
During the first quarter of 2009, public works
have increased by 18
Enhancing public works
Set of measures intended to cover those issues
that affect this sector from a comprehensive
perspective 4,070 million Euros
Integral Plan for the Vehicle Sector
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• 1st AXIS SUPPORTING FAMILIES AND COMPANIES

• 2nd AXIS ENCOURAGING EMPLOYMENT

3rd AXIS FINANCIAL AND BUDGET MEASURES

• 4th AXIS MODERNISATION

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3rd AXIS. FINANCIAL AND BUDGET MEASURES
The Government has implemented a fast reaction in
order to support financing and the stability of
our financial sector so as to restore the credit
flow as soon as possible, both for companies and
citizens

• Urgent Economic-Financial Measures according to
  the Joint Eurozone Action Plan
• Extension of the deposit guarantee coverage,
  which has passed from E20,000 to 100,000 per
  account holder and entity
• Creation of the Fund for the Acquisition of
  Financial Assets four auctions have been carried
  out, providing liquidity with more than 19,000
  million Euros.
• Implementation of State guarantees in order to
  back up the new bank debt financing in the medium
  term guarantees up to nearly 90,000 million
  Euros have been provided during 2009.
• The Minister of Economy and Financial Affairs
  has been authorised to purchase the bonds issued
  by those entities that need to strengthen their
  resources this has not been necessary so far.

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3rd AXIS. FINANCIAL AND BUDGET MEASURES
Current expenditure reduction, investing in
social measures and in measures intended to boost
up economy

• Reduction of the Public Employment Offer.
• Salary Freeze for Senior Offices of the Crown
  during 2009.
• 1.8 current expenditure reduction.
• State expenditure reduction in 2009 the
  Expenditure Budget has been reduced to 1,500
  million Euros.

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• 1st AXIS SUPPORTING FAMILIES AND COMPANIES

• 2nd AXIS ENCOURAGING EMPLOYMENT

• 3rd AXIS FINANCIAL AND BUDGET MEASURES

4th AXIS MODERNISATION
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4th AXIS. ECONOMY MODERNISATION
Strenthening the human and the technological
capital

• INTEGRAL SUPPORT TO EDUCATION AND TRAINING AT ALL
  LEVELS
• Educa3 Plan 300,000 more seats will be created
  by 2012 in order to improve training, encourage
  employment and facilitate harmonisation.
• Fighting school drop out. New scholarships.
• Professional Training Plan. New specialisation
  areas.
• Approval of the University Strategy 2015 and of
  the Excellence Campus Programme.

• SUPORTING RESEARCH, DEVELOPMENT AND INNOVATION
• State Plan for Research, Development and
  Innovation 2008 2011. 47,700 million Euros
• 6.7 increase in the budget for Research,
  Development and Innovation for 2009.
• Tax allowances for Research, Development and
  Innovation in order to encourage innovation.

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