Spain's regions line up for central government bailout

Spain's regional governments have long made it clear that they cannot make it through the year without the help of a central government bailout. Much of the €18bn (£14.2bn) on offer will end up on Spain's eastern Mediterranean coast, with Catalonia, Valencia and Murcia at the front of the queue. They jointly need €9bn to cover deficit spending and the refinancing of existing debt this year. They may need a similar sum to tide them through 2013 and 2014. But several other regions may follow suit, with Castilla La Mancha – which posted the worst regional deficit of all last year – the most likely to need help. A political price must be paid. Regions that take bailout money but fail to meet a strict central government deficit target of 1.5% this year can have their finances taken over by the so-called "men in black" – finance ministry officials from Madrid. That would provoke outrage in Catalonia – a fiercely independent-minded region that already claims it pays too much into Spain's communal tax pot and that the bailout is simply a case of it getting its money back.