The President announces that government will raise growth forecast to 0.7%

Mariano Rajoy announced, in the Upper House of Parliament, that the government will raise its economic growth forecast for the coming year from 0.5% to 0.7%. Furthermore, he stressed that pensions will neither fall nor be frozen and that public servants will receive their extraordinary payments in both 2013 and 2014.

During his speech in the control session held in the Upper House, the President of the Government announced that the government will present its reform of the sustainability of pensions and the Draft General State Budget for 2014 this coming Friday in the Council of Ministers. The latter will contain a "prudent" rise in the growth forecast from 0.5% to 0.7%, although "the majority of analysts place it at closer to 1%". This growth forecast "will enable certain budgetary items, such as grants, research, culture and sport to be increased", said the President of the Government.

In response to a question from the Socialist member of the Upper House, Marcelino Iglesias, on maintaining the purchasing power of pensions, Mariano Rajoy affirmed that the government will modify the public pension system with the aim of guaranteeing its future and providing a response to the demographic challenges taking place throughout Europe.

"It is a question of guaranteeing future pensions and finding a fair balance between generations, of not lowering or even freezing pensions and increasing them more in times of greater revenue", he stated.

In this respect, he confirmed that the reform will only affect pensioners as from the year 2019. "It is a question of future pensioners receiving a similar pension to current pensioners, thus seeking a fairer balance between generations, and hence those who have lived in different times will receive a similar pension".

He also pointed out that pensions will increase according to the CPI, the situation of the economy and State revenue. At any event, he stressed that pensions will never be frozen and will rise by at least 0.25% to a maximum of the CPI plus 0.25%.

The President of the Government added that he believes economic growth will be seen along with job creation, which will mean greater collection of tax revenue to improve key public services and the public pension system.
PUBLIC SERVANT REMUNERATION

In response to a question from the member of the Upper House from the Basque parliamentary group, Jokin Bildarratz, about the level of public servant remuneration in the General State Budget for 2014, the President of the Government confirmed that extraordinary payments will be paid out in both 2013 and 2014.

Mariano Rajoy said that he is aware that "we have asked for a considerable effort from our public servants, and due to the importance of the work they perform and the professionalism of all those people devoted to public service, we will thus improve their situation as soon as possible".

He went on to explain that the government also wants to improve the management of the public administration services. To that end, one of the "most ambitious and important" reforms has been implemented, that seeks "to do things at a lower cost, in less time, more effectively and ensure they are more useful". It is not a question of only making savings, he indicated, "but rather of being more competitive, which is a fundamental requirement in the world in which we live in order to drive growth, create jobs and increase wealth".

The true movers of this reform are public servants, since the work they perform is fundamental; "they are the ones who know the workings of the public administration, the ones who establish the administration and that perform a duty for the good of all", concluded the President of the Government.

YOUTH GUARANTEE FUND

When asked by the member of the Upper House for the Mixed parliamentary Group, Pedro Eza, about the application of the Youth Guarantee Fund, the President of the Government underlined that at a national level, the main weapon to fight against youth unemployment is the Youth Entrepreneurship and Employment Strategy, which was approved in February as a result of dialogue and cooperation with social stakeholders.

The Youth Guarantee Fund will be applied in Spain through this Strategy, he explained, as was ratified in the employment sector conference following its approval, which included representation from the regional governments.

Mariano Rajoy pointed out that the Strategy will have a provision of close to 3.5 billion euros over the next four years. The main aim is to improve the employability of young people, increase their job stability, promote equal opportunities and foster an entrepreneurial spirit.

He also announced that the measures to stimulate employment among young people, approved in the month of February, have resulted in more than 80,000 young people finding a job opportunity as salaried workers or independent contractors in just four months. "That works out at 450 young people each day. Furthermore, it is important to highlight that the number of young people under the age of 25 who are out of work has fallen by 24,800 in the last year, a figure that remains unsatisfactory but one which I believe is at least heading in the right direction".