The Prime Minister, Pedro Sánchez, has announced that the Executive is working on the approval of a royal decree-law aimed at expanding the investment margin of local councils and other local authorities. The regulation will allow them to allocate their own resources to projects that do not involve current expenditure, including actions related to housing or the management of essential services. The scope of this measure will depend, however, on the content that is finally included in the Official State Gazette.
The announcement came after the Council of Ministers meeting and in a political context marked by negotiations. The relaxation of municipal investment restrictions is one of the demands made by this group, which is calling for greater financial autonomy for local councils. According to Sánchez, the royal decree-law aims to respond to this demand, although the technical mechanisms by which the new spending framework will be implemented have not yet been specified.
In practical terms, the measure could open the door for municipalities to use surpluses or remnants to promote structural projects, including those related to housing. Until now, the limitations imposed by fiscal rules have restricted the use of these resources, hindering the development of long-term initiatives by local councils. With the new decree, the Executive aims to expand this capacity, always within a scenario subject to budgetary stability and the usual controls.
The real impact of this measure will depend, however, on factors that go beyond the regulatory framework. Each local council will have to assess whether it has the necessary resources available, suitable land for developing residential projects and the technical capacity to implement them. In the absence of the final text, the exact conditions that municipalities will have to meet in order to activate these investments, as well as the limits that the regulation will impose, remain unknown.
In the absence of the official publication of the royal decree-law, it is not possible to anticipate its effect on the residential market. The ability of local councils to promote new developments will depend on the regulatory details, the availability of resources and the evolution of urban planning in each territory.