After six years at the helm in Spain, Mariano Rajoy was ousted as prime minister after losing a no-confidence motion moved by Pedro Sanchez on Friday, triggered by a corruption case that emerged in 2013, involving members of Rajoy’s party.
The Spanish Socialist Workers’ Party leader Sanchez won the parliamentary confidence vote with 180 votes in favour, 169 against and one abstention and is expected to take office on Monday.
What is the corruption case that resulted in Rajoy’s ouster?
Rajoy has been under the microscope ever since Spain’s National Court pronounced prison sentences to 29 people on May 24 which, involved members of Rajoy’s People Party (PP) including some elected officials. The court charged them with fraud, money laundering and tax evasion.
The scandal first came to light in 2013 when PP Senator and treasurer Luis Barcenas was arrested in the Gurtel case. The Gurtel case goes back to early 2000s incriminating the business circle allegedly led by Francisco Correa, who cultivated links with politicians from the PP. The crimes reported were related to party funding and awarding contracts by regional governments in Valencia, the Community of Madrid and more.
Rajoy’s future took a hit when the arrested Barcenas testified that the PP had a slush fund which it received in the form of donations from private businesses. He attested that some party officials received non-taxable bonuses in addition to their salaries.
What happened after the corruption case?
The Gurtel case was touted as one of the biggest corruption cases in the recent history of Spain and therefore received huge media attention.
In the midst of police investigations, Rajoy managed to survive a no-confidence vote which was passed against him in 2017.
PP’s national headquarters were raided and private messages between Rajoy and Barcenas were released by the Spanish media.
Last week, the National Court fined the PP with 245,000 euros for benefiting from “an authentic and efficient system of institutional corruption”.
What happened after the court’s ruling?
On May 24, the National court announced the prison sentences against the 29 people and a day later, Sanchez’s party filed a no-confidence motion scheduling for Friday.
After the ruling passed by the court, all major parties called for Rajoy’s resignation.
Sanchez’s leadership revived last year after being sidelined for months. Backed by the Socialists, the most popular party in Spain, and the far-left anti-establishment Podemos, Sanchez convinced other nationalist legislators for their support. Support of his party and the nationalist legislators gave him an absolute majority and was able to replace Rajoy.
In Spain, a no-confidence vote not only removes the present prime minister but requires to choose a replacement as well.
What are the reactions of EU members?
Sanchez and his party have been staunch supporters of the European Union and Jean-Claude Juncker, the president of the European Commission has displayed full confidence in the new Spanish government, as reported by AP.
“He has sent (Prime Minister Pedro Sanchez) a congratulatory letter stating his confidence in the Spanish government to continue to contribute in a constructive manner to a stronger, more united and fairer European Union,” a spokeswoman for the Commision said.
Investors believe that the political risk in Spain is less as compared to Italy.
“The parties leading in the polls in Spain are centrists so we’re not getting the proposals for fiscal extremes as we have in Italy,” said Michael Metcalfe, head of global macro strategy, State Street Global Markets, as reported by Reuters.
Given the current challenges faced by the EU, observers have reportedly claimed that it would be difficult for Sanchez to row back on structural reforms passed by Rajoy, including new labour laws and healthcare and educations cuts.