Government extends anti-crisis plan and starts work on 2027 budget

Published on 29/06/2026 - 15:02 GMT+2•Updated

16:06

The government approved on Monday, at a meeting of the Council of Ministers, a new package of measures to mitigate the economic impact of the international crisis, while also formally launching work on the General State Budget for 2027 by updating the macroeconomic framework. The meeting was also used to strengthen the government's housing strategy, one of the political priorities of the current parliamentary term.

The new decree replaces the previous package of measures, which was due to expire on 30 June. As the prime minister had already indicated, the aim is to maintain protection for households, workers and economic sectors particularly exposed to the volatility of energy markets stemming from the geopolitical situation in the Middle East.

The Minister for Economy, Trade and Enterprise, Carlos Cuerpo, defended the extension, arguing that 'we cannot let our guard down', as the economy is still operating in a context of 'high geopolitical uncertainty'. He said the government would continue to support the most exposed sectors for as long as the risks arising from the international situation persist.

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Among the measures being extended are subsidies of 20 cents per litre of fuel for hauliers, farmers and livestock producers, as well as various incentives linked to electrification and the roll-out of renewable energy. The full scope of the decree will be set out by the government after the Council of Ministers meeting.

The approval comes as the National Statistics Institute (INE) publishes the flash inflation figure for June (source in Spanish), which puts the annual rate at 3.2%, the same level as in the previous two months. The government maintains that the measures adopted since March have helped contain price rises, although several analysts warn that the course of the conflict in the Middle East will continue to shape energy costs over the coming months.

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Housing and roadmap for the 2027 budget

Alongside the extension of the so-called 'anti-crisis shield', the government announced a fresh push on its housing policy.

The Minister for Inclusion, Social Security and Migration and government spokesperson, Elma Saiz, said the executive plans to approve in July a package of measures with which it hopes to secure a broad cross-party agreement in parliament. The initiative, she explained, will include measures to regulate short-term rentals, offer tax incentives to landlords who lower rents and raise VAT on tourist accommodation to 21%, among other proposals aimed at improving access to housing.

These initiatives add to the 2026-2030 State Housing Plan, approved by the government last April and endowed with total investment of €7 billion, 60% of which will be provided by the state and 40% by the autonomous regions. Among its objectives, the programme aims to expand the stock of public housing, strengthen renovation work and ensure that subsidised homes built with public funding remain permanently protected.

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Housing policy, however, remains a source of political confrontation. The regional government of Andalusia has launched a jurisdictional dispute, arguing that certain aspects of the national plan encroach on regional powers, an accusation the Housing Ministry rejects.

Updating the macroeconomic framework is the first formal step in drawing up the 2027 General State Budget. The government believes these new forecasts will provide the basis for shaping next year's public accounts, before approving the spending cap and the budgetary stability targets and sending the draft bill to parliament, probably after the summer.

The government has reiterated its intention to present a new budget for 2027, after several years of working with rolled-over accounts, although its approval will depend on securing a sufficient parliamentary majority as the bill passes through Congress.