The central government and the Canary Islands regional government continued to disagree on Thursday over the 100 million euros a year that the autonomous community is demanding from the State to continue with the reconstruction of La Palma, during the final joint committee meeting of this parliamentary term dedicated to monitoring the consequences of the Tajogaite eruption.
The Canary Islands Government’s Minister for the Presidency, Nieves Lady Barreto (CC), emphasised at the subsequent press conference that there is an unspent central government allocation of 100 million euros and argued that it would be sufficient simply to approve its transfer at a meeting of the Council of Ministers.
«We’re not going to see eye to eye on this, except that funding is needed,» said Barreto, who pointed out that the Canary Islands initially set aside 200 million for the reconstruction and that the amount contributed by the autonomous community has now exceeded 400 million.
La Palma: Governments interpret budget items differently
The regional minister has called for those 100 million, relating to 2026, to be transferred «whichever government is in power» following the general election, and has warned that there are still outstanding works to be carried out on roads, farm tracks, irrigation networks and the restoration of farms.
The Minister for Territorial Policy, Ángel Víctor Torres (PSOE), has taken issue with the Canary Islands Government’s interpretation and has maintained that the 100 million included in the 2023 budget did not stem from the so-called ‚Canary Islands Agenda‘ agreed between the PSOE and Coalición Canaria as part of the investiture process, but rather from budgetary agreements from the previous legislative term.
Torres pointed out that the central government subsequently authorised the Canary Islands to use a further 100 million from its surplus for reconstruction, a move which required a change to the regulations, and argued that there had been a «clear commitment» to meeting the needs of La Palma.
The minister has put the figure for the funds allocated so far to the island’s reconstruction following the eruption at around 1.6 billion euros and has admitted that there is still work to be done.
Barreto has clarified that the 100 million is listed in section 37 of the Ministry of Finance’s budget under the heading ‚Recovery Plan for La Palma‘ and has maintained that, as the general state budget has been extended, the allocation continues to appear in the 2026 accounts.
Torres responded that rolled-over budgets are a «carbon copy» of the originals and that the inclusion of a budget item in them does not mean it must be implemented again in every financial year, although he considered the regional government’s claim to be «legitimate» and undertook to pass on the request for further resources to complete the reconstruction.
Income tax relief is set to remain in place in 2027 as well
The committee has also discussed the 60 per cent personal income tax rebate for residents of La Palma.
In this regard, Barreto expressed her gratitude for the commitment to maintaining the scheme, but called for the reduction to be applied directly each month to tax withholdings rather than through a subsequent refund on the tax return.
Torres has stated that the 60 per cent personal income tax rebate is earmarked for 2027 and has given assurances that, should the current Government remain in power after the elections, this level will be guaranteed; he has also called on the other political parties to make the same commitment in the event of a change of government.
The minister has estimated the impact of this tax relief on state revenue at between 80 and 100 million euros and explained that the Canary Islands Agenda provides for an annual assessment and a subsequent study, involving AIReF, to determine how long these exceptional measures should remain in place.
«How long? For as long as necessary,» Torres summarised.
Barreto, for her part, has argued that there is scope to approve the tax relief for 2027 now and allow it to be applied directly to pay packets from January, as was done previously when different financial years were approved simultaneously.
Island Council calls for exemptions for reconstruction funds
For his part, the president of the La Palma Island Council, Sergio Rodríguez (CC), has warned that the island is «running out of time» to resolve several outstanding issues and has put the investment made by the island council in the reconstruction at around 80 million.
Rodríguez has also called for the funds received by the Island Council for works related to the volcano to be exempt from fiscal rules, to prevent them from having to be used to repay debt rather than to continue with the reconstruction.
He has also called for the extraordinary employment schemes for the affected local authorities to be maintained and for the Cabildo to be reimbursed for the 7.3 million euros it spent on hotel accommodation during the emergency.
Torres has stated that he will raise the need for these employment schemes with the ministries and has argued that it «makes no sense» for funds specifically earmarked for reconstruction to end up being used to reduce debt.
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