President Pedro Sánchez of Spain has announced a state aid package valued at €10.6 billion for areas impacted by recent storms, known as "DANA" in Spanish. This support will be extended as further needs are identified.
The package comprises direct aid along with tax and labour measures. It introduces a new credit line called "ICO-DANA" worth €5 billion, enabling SMEs, the self-employed and families to apply for government-backed loans to cover costs arising from the disaster.
Sánchez, speaking at a press conference following the Council of Ministers meeting, stated that the loans would enable businesses to reopen and families to repair their homes as quickly as possible.
The President noted that the Consortium’s expenditure is expected to reach an "unprecedented" €3.5 billion, with over 70,000 applications received to date. “As of tomorrow, and particularly from Friday onward, the compensation consortium will be able to distribute a substantial portion of these resources,” he reiterated.
Between €20,000 and €60,000 to repair damaged homes
The first set of measures approved today named the "Immediate Response, Reconstruction, and Relaunching Plan for the Valencian Community", includes direct aid for 78 municipalities – 75 in the Valencian Community, two in Castile-La Mancha, and one in Andalusia – and subsidies of up to €72,000 for individuals with disabilities, with no income cap. This represents a fourfold increase in the public aid stipulated by law.
Additionally, between €20,000 and €60,000 will be provided for the repair of damaged homes; up to €10,300 to replace or repair furniture, appliances and household items; and up to €37,000 for the repair of communal facilities in blocks of flats.
New ICO-DANA credit line
The head of the Executive has announced that discussions with financial institutions are already in progress to establish this new credit line, aiming for it to be accessible by next week. This Tuesday, the Council of Ministers approved an initial tranche of €1 billion, which will be expanded to a total of €5 billion.
Furthermore, starting tomorrow, the Insurance Compensation Consortium will begin issuing the first compensation payments to families and businesses that have lost vehicles, with payments set at 20% above the appraised value of each car.
Exemptions from the IBI and deferred Income Tax payments
Among the tax measures, the second instalment of personal income tax payments will be deferred by three months for Valencian taxpayers with outstanding returns. There will also be moratoriums and exemptions on property tax (IBI), business tax, and vehicle deregistration fees.
Mortgage and other loan moratoriums for businesses and families
On financial matters, the chief executive highlighted an agreement with banks allowing citizens and SMEs with mortgages or consumer loans to defer full loan repayments for three months, followed by an additional nine months in which only interest payments will be required.
The package also stipulates that the Government will cover 100% of the emergency expenses incurred by affected municipalities, with up to 50% of reconstruction costs also funded.