Spain’s Autonomous Communities and their opaque “beach bars” – a system that widely opens the door for political favoritism and misuse of public funds.
Spain is once again at the center of a debate about the efficiency and transparency of its public administration. A recent report by the UCO (Central Operative Unit) reveals how a system of nepotism has flourished in over 1,772 “parallel” or “ghost administrations” within the Autonomous Communities, but also in the state and municipalities. These so-called “instrumental entities,” originally intended to increase operational efficiency, are increasingly proving to be a gateway for placing party loyalists and relatives.
The Faffe Case: A Textbook Example of Abuse
A particularly egregious case, confirmed by the UCO, concerns the Andalusian Foundation for Training and Employment (Faffe). This public institution, founded in 2003 to combat unemployment and improve worker training, became a veritable employment agency for party officials. The report confirms a civil servants’ union complaint about the hiring of 85 PSOE officials, including the wife of Juan Espadas, former Secretary-General of the PSOE in Andalusia and current socialist spokesperson in the Senate. Although the Faffe was dissolved by the PSOE in 2011, its 1,664 employees found employment in the Andalusian Employment Service, where many were able to consolidate their positions thanks to a stabilization process. This raises serious questions about accountability and control of public funds.
A Web of “Beach Bars”: Spanish Administration Under Fire
The Faffe scandal is not an isolated incident but a symptom of a deeper problem in the Spanish administrative landscape. In addition to the 1,772 entities of the Autonomous Communities, there are 450 state entities (plus 43 more unattached ones) as well as almost 4,200 municipalities and provincial councils. In total, Spanish public administrations have almost 6,500 such entities that serve as platforms for parties to place “their legion of cronies.” These bodies, which are subject to less transparency and control, have become a refuge for friends, relatives, and beneficiaries of political leaders, especially during economically difficult times. The principles of equality, merit, capacity, and publicity are often disregarded, as shown by the case of the hiring of Ábalos’ friends by state entities.
Catalonia at the Forefront of the “Shadow Administration”
The Autonomous Communities are particularly affected by this phenomenon. According to the Ministry of Finance’s inventory, there are a total of:
- 539 foundations
- 428 commercial companies
- 319 consortia
- 166 public entities
- Almost 160 administrative, commercial, and autonomous entities
- Fifty public companies
- 40 universities
- 33 “other” non-profit entities
- 16 agencies
At the top of this opaque list is Catalonia with 364 instrumental entities – an increase of 12% since 2008. One in five entities of an Autonomous Community belongs to Catalonia. With 112 registered members and 98 foundations, accounting for 60% of its units, as well as 64 commercial companies and 55 public entities, Catalonia is a prime example of the spread of this “parallel administration.”
Other regions also show high numbers, though not to the extent of Catalonia. Andalusia has 181 such entities, the Basque Country 154, the Valencian Community 135, and Madrid 123. The problem is also prevalent in Aragon (almost 100) and in the Balearic Islands and Canary Islands (74 each).
Diversity and Absurdity: The “Fine Print” of the List
The list of “instrumental entities” reveals astonishing diversity and sometimes absurd constructions. In addition to foundations for training and employment, there are:
- Catalonia: Competition Authority, Centre for Opinion Studies, Institute of Catalan Literature, Olympic Foundation of Barcelona, Catalan Export Promoter, Lotteries of Catalonia, or even the company Comercial La Forja for the manufacture of iron and steel products.
- Andalusia: Olympic Foundation, Seville Symphony Orchestra, Knowledge Agency.
- Basque Country: Basque Institute of Public Administrations, Cybersecurity Agency, Internationalization Agency.
- Valencian Community: Academy of Languages, Climate Change Agency, Railway Safety Agency.
- Madrid: Agency for the Guardianship of Adults, Madrid Foundation for Excellence, numerous urban planning consortia.
These examples show how widespread and often without clear economic justification these structures are created and maintained. Even politicians like Santiago Abascal (Vox) admitted to having been employed in inactive entities. For 17 years, the General State Intervention has been trying to bring order to this chaos, but the process has stalled. Most reductions result from integrations, mergers, or disaggregations into other public entities, not from genuine streamlining.
It is clear that the UCO and the General State Intervention must continue to act actively in this important public sector of the Autonomous Communities to ensure transparency and accountability and to stop the misuse of taxpayer money.
