Madrid.Spain's ruling Socialists promised to guarantee funding for public health care if they win Nov. 20 elections by hiking taxes on alcohol and tobacco while cutting tax breaks for companies that offer employees private health cover. If we want to protect the jewel in the welfare state's crown, we must ask those who can to make an effort to do so, Socialist party leader Alfredo Rubalcaba said during a three-day conference to discuss the party's political manifesto. The measures the Socialists propose to preserve cheap and good healthcare for all will help eliminate the deficit in the health system, which the government estimates will run at 2 billion euros in 2012, Rubalcaba said.
Health budgets are controlled by regional governments, whose spending lies at the heart of fears over Spain's ability to avoid sinking into a debt crisis like Greece or Ireland.
Spain's centre-right opposition Partido Popular (PP), who dealt the Socialists a crushing blow in May municipal elections, have already implemented health spending cuts in some of the 17 regions they now control as part of the party's austerity plans.
However, the deepest cuts have been in Spain's richest region, Catalonia, where. the Catalan nationalist party CiU has been suspending payments to care homes and mental health clinics because the money ran out.
Cuts in health and education budgets, also controlled by the regions, have already fuelled protests and strikes around Spain.
A 10 percent tax hike on tobacco and alcohol -- excluding beer and wine -- would raise 1 billion euros to cut the health system deficit, while abolishing tax breaks for companies offering private health insurance to employees would raise 300 million, Rubalcaba said.
A further 700 million euros would be generated by plans to claim money back from insurers to repay costs incurred to the state due to accidents.
The Socialists' tax hike plans contrast with the PP's commitment to cut taxes for small and medium enterprises if it gets back into power after over seven years on the back benches.
PP leader Mariano Rajoy reiterated these plans on Saturday at a party meeting in Valencia where he also announcedthat one-person businesses which hire an employee will be awarded a 3'000 euro tax rebate.