The Government of Spain activates a plan for the recovery of the areas affected by the DANA

Moncloa Palace, Madrid

The President of the Government of Spain, Pedro Sánchez, during his appearance after the Council of Ministers (Pool Moncloa/Borja Puig de la Bellacasa)

The Council of Ministers has approved a Royal Decree-Law adopting urgent measures to respond to the damage caused by the Isolated Upper-level Depression (DANA) in various towns between 28 October and 4 November 2024.

The President of the Government of Spain, Pedro Sánchez, appeared at the press conference following the Council of Ministers to present these first rapid response initiatives, to which all those necessary to rebuild the affected areas and relaunch the territory will be added.

Pedro Sánchez has reiterated that, from the outset, the Executive has been working on four priority areas: saving lives, recovering the bodies of the deceased with the speed and dignity they deserve, guaranteeing security in the streets, and restoring supplies and services in the affected areas.

After reviewing the progress made in the last 72 hours in these areas, the head of the Executive insisted that it is necessary to "continue working without distractions, with more resources, more coordination, and greater effort until normality has returned to all the towns and homes affected by this tragedy."

Declaration of disaster zone

The Government has agreed to declare the affected territories as "Zone Seriously Affected by a Civil Protection Emergency" (traditionally referred to as a disaster zone declaration). The declaration facilitates the approval of extraordinary aid to alleviate personal, material, commercial and service damages, aid to natural or legal persons and local corporations, as well as other aid to repair infrastructure, fiscal, labour and social security aid.

Immediate Response, Reconstruction and Relaunch Plan of the Valencian Community

The measures included in this plan are aimed at both Valencian towns and those in other provinces affected by the DANA, according to the president. The plan consists of three phases: immediate and urgent response to the disaster, reconstruction of the affected areas and relaunching, which implies its transformation to adapt the territory to the climatic emergency that is affecting the Mediterranean Sea.

Direct aid to households, self-employed people and companies

The President of the Government of Spain, Pedro Sánchez, appears before the media after the meeting of the Council of Ministers | Pool Moncloa

Among the immediate response actions, the president stressed that the government will activate direct aid to affected citizens and companies, as it did during the pandemic, "with as little paperwork and as quickly and swiftly as possible."

The Royal Decree-Law on urgent measures quadruples the aid provided for in current legislation to meet the needs arising from emergencies or disasters, and this aid will be universal. The Executive will transfer up to 72,000 euros in cases of disability, between 20,000 and 60,000 euros to repair homes, up to 10,300 euros to replace furniture, electrical appliances or household goods, and up to 37,000 euros to repair elements of the communities of neighbours, such as doorways or lifts.

In addition, the Executive will transfer direct aid for small and medium-sized companies and self-employed people with tax domicile in the areas affected by the DANA amounting to 838 million euros. The self-employed will receive 5,000 euros and companies between 10,000 and 150,000 euros, depending on their turnover. The measure will benefit 65,000 self-employed people and some 30,000 companies, which will be exempt from personal income tax and corporation tax.

Pedro Sánchez has stated that beneficiaries will only have to indicate their bank account number and will start receiving this aid in less than 30 days.

In addition, an extraordinary temporary disability is created for all workers with physical and psychological damage caused by the tragedy, who will be guaranteed 75% of their salary from the first day of disability.

Self-employed people with affected businesses will be able to apply for a severance benefit corresponding to 70% of their contribution base, even if they have not completed the minimum 12 months required by law to qualify for it.

Recipients of the Minimum Basic Income or non-contributory benefits who have been affected by the DANA will be paid an additional supplement of 15% for at least three months.

The president of the Government of Spain has announced that the Insurance Compensation Consortium will begin to pay the first compensation payments tomorrow to families and companies who have lost their vehicles, which will be 20% higher than the appraised value of each vehicle. "We are aware that for many families and for many self-employed people and SMEs, having a car is essential to regain their normality. And so the teams have been working around the clock to start transferring these items in record time, seven days," he said.

DANA Guarantee Facilities

To complement this aid, the Council of Ministers has approved the creation of DANA guarantees facilities worth 5 billion euros, similar to the one provided during the pandemic.

These facilities will enable small and medium-sized companies, self-employed people, the social economy and, for this time, households to access Government-backed loans on very favourable terms through their bank.

The president assured that the Executive is working with financial institutions so that the loans can be applied for from next week.

Moratoria and tax exemptions

The President of the Government of Spain, Pedro Sánchez, appears before the media after the meeting of the Council of Ministers | Pool Moncloa / Jose Manuel Álvarez

As announced yesterday by the Ministry of Finance, the Council of Ministers has approved the possibility for taxpayers affected by the DANA to delay the second payment of Personal Income Tax (IRPF) to 2025, as well as any other tax they have pending with the Tax Agency. They are also exempted from paying Property Tax (IBI), Business Tax (IAE) on damaged properties and the fees for processing the deregistration of vehicles and the issuing of official documents that have been lost.

As was the case during the pandemic, affected companies that temporarily suspend the activity of their staff through a Temporary Redundancy Scheme (ERTE) will be exempt from paying 100% of Social Security contributions, at least until February 2025.

Moreover, thanks to the agreement reached by the Executive with financial institutions, citizens and small and medium-sized companies, self-employed people and social economy organisations with a mortgage or consumer loan will be able to postpone full payment of their loans for three months and pay only interest for a further nine months. This means that, for example, in the case of an average mortgage of 120,000 euros with a monthly instalment of 600 euros, they will pay nothing for the first three months and, for the following nine months, the monthly instalment will be 300 euros. A relief that, according to the president, "will help us to protect the productive fabric until the situation improves, as we did during COVID-19."

More resources for towns

Another set of measures is aimed at strengthening the financial and human resources of local councils, whose work Pedro Sánchez has appreciated. "We want mayors of all political stripes to be able to provide the best possible service to citizens in these difficult circumstances and to start reconstruction work as soon as possible," he said.

To this end, the Executive will pay 100% of the emergency expenses of the local councils, including all actions related to the removal of mud, debris and unusable goods, the supply of drinking water, street cleaning, accommodation and food for the affected residents.

The Government will also cover up to 50% of all the work that the towns will carry out in the coming months and years to repair facilities and infrastructure. They will also be compensated for the municipal taxes they will lose during this crisis and will be allowed to use their tax surpluses to repair damages, which will be considered as financially sustainable investment.

In the area of justice, the Executive will reinforce the courts and the teams of notaries and land registrars and will set up a portal for registry emergencies so that citizens can certify the location of their property as easily and quickly as possible via satellite.

Reinforcement offices will also be opened in the affected towns to support the work of local civil servants in assisting citizens and managing bureaucratic procedures.

The president of the Government of Spain recalled that in Spain, competences and resources are distributed among different public administrations. "We are all the State, from the Government of Spain to the last of the local councils, and that is why we have to work hand in hand to speed up aid and recovery," he said.

Institutional coordination and European funds

Pedro Sánchez highlighted three other decisions of the Council of Ministers. Firstly, the creation of an inter-ministerial commission to coordinate the reconstruction and relaunch of the Valencian Community, i.e. phases 2 and 3 of the Plan. "We will open up spaces for dialogue with the citizens, with the local councils, with the provincial and territorial administrations affected," he said.

Secondly, the Executive has adopted a series of mechanisms to strengthen bilateral cooperation with the regional governments concerned and, in particular, with the Valencian Community.

Finally, the government has already formally requested the European Commission for aid from the European Solidarity Fund and has also asked the European Council and the European Parliament approve the new 'Restore' Regulation as a matter of urgency to redirect part of the cohesion, ERDF and ESF+ funds to alleviate the damage caused by natural disasters.

First step "streamlined and ambitious."

The president of the Government of Spain has put the total investment that the first response measures will entail at more than 10.6 billion euros. "It is a first step, a streamlined and ambitious step, with specific and realistic measures that come into force now and that will help people and companies in the coming days and weeks," he said.

Pedro Sánchez stressed that this aid package is "only the beginning" and that new measures of a more specific nature will soon be approved for the workers, companies, sectors, areas and public administrations affected.

"We are going to be with our people until the end, with all the means, for as long as necessary, as we have done during other extreme situations that we have had to live through as a society in recent years," he said.

Non official translation