Adjusted Population: The Core Debate in Spain's Regional Funding Model

Experts criticize the central mechanism proposed by Minister Montero for failing to include the cost of living and being prone to data manipulation.

Representació abstracta de la distribució de fons públics o càlculs econòmics complexos.

Representació abstracta de la distribució de fons públics o càlculs econòmics complexos.

The new regional financing model, promoted by the Government and Minister María Jesús Montero, relies heavily on the "adjusted population" criterion, which economists from the University of Barcelona deem inadequate to ensure equitable public services across the territory.

The adjusted population is the main mechanism used to calculate the funds each autonomous community should receive. It is based on the total population census, but corrected according to a series of weighted criteria, with the theoretical goal of ensuring that all citizens have equivalent social benefits, regardless of where they live in Spain.
However, economics professors like Joaquim Solé of the University of Barcelona warn that this mechanism, despite offering a veneer of scientific rigor, is easily manipulated. Furthermore, neither the current 2009 model nor the proposed one includes a crucial variable: the cost of living in each community, which significantly affects the final outcome of social benefits.

"Using an adjusted population indicator makes data manipulation very easy."

Joaquim Solé · Professor of Economics at the University of Barcelona
Minister Montero's proposal slightly modifies the 2009 model. The main weights remain: real population accounts for 30%, health expenditure for 38%, and education investment for 20.5%. The main novelty is the diversification of age groups in healthcare (from 7 to 20 brackets) and the segregation of higher education.
This equalization system means that 75% of the taxes collected by the communities go into a common fund distributed according to the adjusted population. Currently, only three autonomies are net contributors, providing more than they receive: Madrid, the Balearic Islands, and Catalonia. Professor Núria Bosch points out that although it is assured that Catalonia will be the third in receiving funds per capita, the concept of ordinality has not been put in writing.

"Note that the documentation provided by Minister Montero doesn't even mention ordinality."

Núria Bosch · Professor of Public Economics at the University of Barcelona
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