Critical Reflections on the Autonomous Liquidity Fund after a Decade of Validity (2012-2022)

Abstract

Ten years after the establishment of the Autonomous Liquidity Fund (FLA) as an additional financing mechanism through which the State tried to ensure the financial viability of the autonomous communities, numerous criticisms continue to be raised regarding the damage caused to the principle of financial autonomy not only by the rigid fiscal and financial conditionality imposed on sub-central entities, but also by the strict supervision and control carried out by the State. This paper attempts to provide a critical analysis of the operation and consequences of this instrument to support the liquidity of the autonomous communities, assessing the results obtained and formulating a series of reflections that, with a prospective vision, help to resolve the pending problematic issues, with special reference to whether or not the FLA should survive, as well as the management of the enormous debt accumulated by the autonomous communities.

Keywords

• autonomous liquidity fund
• public debt
• budget deficit
• autonomous regions