THE ECONOMIC AGREEMENT BETWEEN THE BASQUE COUNTRY AND SPAIN
The horizontal coefficients are calculated every year. In the year 2010, the horizontal coefficients were 16.91% for Alava, 50.14% for Biscay and 32.95% for Guipuzcoa. The historical tendency has been a decrease in the coefficient of Biscay, an increase in the coefficient of Alava and stability in the coefficient of Guipuzcoa162. Table 16 summarizes the working of the horizontal model in the year 2008. As already said that year the adjustment fund benefited Alava and Guipuzcoa while Biscay was a net contributor to the fund. Notice that the fund is not redistributive. For instance, in 2008 the only net contributor was Biscay, which was the HT with the lowest per capita GDP. This is not surprising because the fund does not have a redistributive objective. Its purpose is to eliminate the differences between the contribution coefficients and the shares of the HTs on total resources. Table 16: Resources of Foral Deputations1 (2008) Wealth Index2
Horizontal coefficient
Share AdjustAgreed Contriin ment Taxes butions Quota Fund (A) (C) (B) (D)
Resources Total A-BC+D
Per capita euros
% of GDP
index value index
Alava
114
16.91
2,034.2
198.8
1,338.4
69.1
566.1 1,803.8
101
5.0
89
Gipúzcoa
102
32.95
4,128.9
386.5
2,601.8
41.6
1,182.3 1,675.3
94
5.3
93
587.6
3,956.0
3
0.0
2,127.6 1,845.8
103
6.1
108
12,834.2 1172.9
7896,1
110.7
3,875.9 1,784.3
100
5.7
100
Biscay TOTAL
95
50.14
100
100.0
6,671.1
1
In millions of euros. 2 Per capita GDP. 3 The contribution to the fund of Biscay (and the other HTs) is included in C. Source: OCTE (several years), www.bizkaia.net, www.gipuzkoa.net, and EUSTAT (www.eustat.es).
The last columns of Table 16 give the final distribution of resources after the horizontal model has been applied. The results show, again, that the model is not egalitarian and allows significant differences in the resources of HTs, both in per capita terms and as a percentage of GDP.
7.3. The Share of Municipalities The resources of a HT after paying the Quota and the Contributions are divided between the Foral Deputation and the municipalities of the Territory. In principle, each HT can decide freely how many resources to assign to the municipalities, and how will distribute this amount among the municipalities. However, the Contribution Acts include a provision recommending a minimum share of municipalities in the resources of the Territories. So far, this recommendation has been always accepted by the Foral Deputations. For the period 2007-2011 this minimum recommended is 54.7% of the resources of the Foral Deputation. That is, 54.7% of what is left after paying the Institutional Obligations (Quota and Contributions). The resources of the ith HT after Institutional Obligations, RAi, are: RAi = Ri – αi(GC + SC + Q) ± GFAi 162
[17]
For instance in 1985 the coefficients were 14.42% (A), 52.49% (B) and 33.09% (G). In 2000 the coefficients were 15.96% (A), 51.32% (B) and 32.72% (G)
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