Spain’s Prime Minister Mariano Rajoy may take a pounding from fresh corruption allegations against his People’s Party but the Government is strong enough to ride the storm, analysts and sources say.
A Spanish newspaper said yesterday it had handed over handwritten docu-ments to the High Court which it said were ledger entries showing payments from an illicit slush fund run by the PP to party leaders, including Rajoy.
El Mundo newspaper splashed colour photocopies of the ledger entries on the front page of yesterday’s paper, the latest instalment in a long-running corruption scandal which has damaged the government’s credibility as it seeks to bring a sickly economy back to health. “It obviously doesn’t help the Spanish brand,” Foreign Affairs Minister Jose Manuel Garcia-Margallo said yesterday when asked about the latest twist in the scandal.
Spain’s ruling PP party and the government repeated denials that party members had ever received illegal cash.
But the scandal has refused to go away since El Pais newspaper published photocopied excerpts of the same ledger in January. It has angered Spaniards suffering a long-running recession, high unemployment and public spending cuts.
El Mundo did not say how it had got its hands on the documents, but the editor, Pedro Ramirez, published on Sunday an interview with the alleged author of the ledger entries and operator of the slush fund – former PP treasurer Luis Barcenas, currently in custody as the High Court continues a pre-trial investigation into corruption charges against him. The newspaper said payments amounting to tens of thousands of euros were delivered to party leaders, in Rajoy’s case sometimes concealed in a box of cigars.
The affair has not affected the premium investors demand to hold Spanish debt rather than the German benchmark, a measure of perceived political risk.
But top government officials acknowledge that the corruption allegations are damaging the country’s image abroad. Senior PP members, speaking on condition of anonymity, also concede that many within the party fear they will lose European elections in 2014 and local and general elections in 2015.
They would like to see Rajoy, known for his caution, fight back more strongly against the allegations. Support for the PP has crumbled to 23 per cent from 45 per cent at the time of the November 2011 general election, a poll published on Sunday in El Pais showed.
While conceding in private that the first corruption allegations in January slowed down the pace of government reforms, PP officials insist Rajoy’s leadership is not seriously questioned within the party.