The Council of Ministers has approved the regulatory development of the Deindexation Law of March 2015, which seeks to de-link the revision of prices of goods and services in the public sector from the IPC. This law was pending regulatory development for its full application. The regulations approved today assess the exceptions in which the reviews are allowed and establish the requirements that must be met in these cases, for example, that the review reflects a cost structure based on the principles of efficiency and good business management. . In this way, it is avoided that the Administration or users of public services have to bear the costs of those business practices that are not the best on the market.

The Law establishes as a general rule the prohibition of indexing in order to avoid the so-called “second round effects” and inflationary inertia. This protects the general economic activity from inflationary outbreaks, by preventing them from moving between the different sectors of the economy and from becoming permanent. Thus, certain prices in which the public sector intervenes, such as bus tickets, trains, motorway tolls, medicine prices, regulated prices for gas or electricity, cannot be indexed with respect to the CPI. Changes in these prices will no longer be automatic depending on the evolution of inflation and may only vary when there are other causes that have been previously justified and accredited.

The law excludes from its scope of application salary negotiation, pensions and the issuance of public debt.

Exceptionally, the possibility of indexing is allowed in cases where this mechanism is necessary and efficient; that is, as long as this review reflects, in the most appropriate way possible, the evolution of the costs of the activity in question. Specifically, the regulation regulates the set of monetary values ​​that can benefit from the periodic review regime based on specific price indices. Three types of monetary values ​​are included in the list. Firstly, some regulated energy prices such as the butane cylinder, the last resort rate for natural gas, the transport and distribution of electricity or the Voluntary Price for the Small Consumer of Electricity (PVPC). Second, real estate leasing contracts in which the public sector is involved. Thirdly, contracts, for example works, and long-term public sector concessions, that is, those that require large investments and therefore a payback period for such investments that exceeds five years.

These indexations will generally be carried out using previously priced formulas that must be justified by a cost structure based on the principles of efficiency and good business management. Only the essential and significant costs for the activity and whose evolution is unpredictable will be considered. Individual prices or specific price indices reflecting those costs should be used. It is not allowed to index financial costs, amortizations, general and structural expenses, or industrial profit.

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