"We are committed to clear policies that facilitate financing and reduce costs", says Mariano Rajoy

Mariano Rajoy said that the urgency of the situation has led the Government to take immediate action on the most important issues, "although the reform process will be ongoing throughout the entire Legislature". Ensuring the sustainability of the public finances, guaranteeing the viability and credibility of the financial system and taking action on competitiveness and flexibility will be the main cornerstones of Government activity.

As regards the last point, the President of the Government stressed that the reform of labour issues is absolutely essential and greatly helped by the social stakeholders in reaching agreement on such matters as salary moderation. However, there are other matters that still require work, such as intermediation, hiring, internal flexibility, training and the structure of collective bargaining.

These matters are the ones that will be dealt with by the Government in a labour reform that, according to Mariano Rajoy, will be "extensive and profound while also balanced and, above all, useful for obtaining a climate that is conducive to competitiveness, the creation of jobs and stable employment".

The objectives of this reform will be "increasing flexibility, mobility and the ability to adapt to economic circumstances, reducing duality in the labour market and increasing training as ways to foster youth employment".

He added that an agreement was reached in Brussels to undertake immediate action, at both national and European levels, to improve the employment offer and reduce unemployment, especially among young people.

The President of the Government summarised the three main proposals formulated by the Spanish Government for Europe. The first relates to establishing common rules for creating a capitalisation fund for workers intended to replace dismissal costs.

In his opinion, "it will facilitate new hirings by businesses, especially SMEs, and labour mobility, thus contributing to progress in the single market".

The second is focused on harmonising executive pay at financial entities receiving public money, establishing quantitative limits.

Mariano Rajoy believes that "we need to bring order to the accounts of those who are partly to blame for the lack of credit.

That will enable situations like this one to be prevented in the future and will help avoid the current lack of credit from significantly limiting the capacity of our companies to grow and create jobs".

Finally, the third proposal refers "to re-using unspent European funds on supporting employment, reducing the technological divide and making access to finance easier for small- and medium-sized companies".

The President of the Government stressed that his message at the Council was also clear on other issue. "In order for the process of adjustment currently being undertaken in Spain and Europe to be successful, it is absolutely essential that financing be made available. In this regard, the new stability mechanisms and actions by the ECB are fundamental, as well as fiscal discipline and structural reforms, to protecting the single currency".

Mariano Rajoy also explained that, while speaking at the European Council meeting, he defended the idea that "fiscal consolidation alone will not suffice if we wish to achieve our objective of re-launching the economy and creating jobs. It is a necessary condition but not enough on its own. The adjustments are essential but we cannot continue with adjustments and nothing more".

The President of the Government concluded his speech by stressing that "I am convinced that the fruits of our labour will blossom if we stop improvising, avoid stumbling from one thing to another and stand firm in the application of these measures, without wavering, until we achieve what it is that we want to achieve".

In his response to the parliamentary spokespersons, the President of the Government insisted that the main objective and one shared by the entire House "is nothing more than growth and employment.

Everything else is instrumental". Control of the public deficit, the structural reforms and the labour reform are instruments to be used for achieving those objectives, he added.

He explained to the spokesman for the socialist party, Alfredo Pérez Rubalcaba, the reasons behind his "non-public" comment that the labour reform was going to cost him a general strike. "In the summer of 2010, the Government approved a series of measures that could be considered something like a labour reform. There was a general strike. It's a pretty clear precedent.

Why should I think that I'm in any better than Mr. Rodríguez Zapatero?". In any case, he welcomed the effort made by the social stakeholders to sign a "magnificent agreement" on salary moderation.

Mariano Rajoy stressed that he will not let any of the autonomous regions fall, "that would be irresponsible, but we are going to demand that they meet their deficit requirements and we will implement support mechanisms for those that do".

In response to criticism regarding the delay in presenting the draft General State Budget, Mariano Rajoy reminded the House that this Government will be preparing in three months what is normally done in five or six. He insisted on the Government's intention not to approve the macroeconomic forecasts until those from the European Commission have been released, which will be made public on 23 February.

He also expressed his willingness to consider stimulus measures, "but carefully", recalling that such a plan worth 13.5 billion euros has already been carried out to finance the local authorities which simply increased the deficit. Mariano Rajoy believes that "stimulus measures would mean raising pensions and not touching unemployment benefits".