Spanish Finance Minister, Elena Salgado said that the country should apply further spending cuts next year, more than the approved by the parliament to avoid suffering from the debt crisis; she added that 3.8 % spending cuts presented in the plan might be expanded by September when the parliament votes on the budget.
The budgets cuts are needed, where the European debt crisis is deepening and may expand to other countries, where yesterday the finance chiefs in the zone reached no decision regarding Greece, Moody's downgraded Ireland's credit rating and that kept the pressure Spanish bonds' yields which are still moving higher.
Salgado said in a meeting with lawmakers in Madrid that, We don't rule out that in September, when the budget project for 2012 is brought to Parliament, the spending limit may be lower than the one presented today. It is more necessary than ever to show our firm commitment towards austerity.
The budget cuts of 117.4 billion euros passed the cabinet meeting on June 24, with more than half of the lawmakers giving a vote of confidence on needs for austerity measures.