A gross scandal was revealed: Spain used EU money for things other than what it was supposed to

In Spain, it has been revealed that in 2024-2025, the government has spent more than 10 billion euros in recovery grants received from the EU for the payment of pensions and state social spending.

Grants from the recovery funds established in 2020 are intended for revitalizing economies after the corona pandemic with, for example, projects supporting the green transition, and they must be kept separate from the state’s ongoing budget expenditures.

However, the state audit body Tribunal de Cuentas has now found that in 2024, 2.4 billion euros of recovery grants were transferred to public sector pensions.

El Mundo magazine, on the other hand, has found information from the government’s budget report for the year 2025 that shows that “at least 8.5 billion euros” of EU funds allocated to recovery projects have been transferred to the payment of pensions and social expenses and to the losses of the state post office.

The government sees nothing wrong

The Spanish government has told the newspaper that there is nothing wrong with the procedure, because there was no immediate need for the money reserved for the recovery projects that year, so it was as if borrowed in the state accounting temporarily for other needs.

According to the newspaper, the planned projects for recovery funds had included, among other things, the expansion of the charging infrastructure for electric cars and investments in electricity storage capacity.

Just in 2025, Spain was blacked out for a day by the collapse of the entire electricity grid, one of the reasons for which is considered to be the lack of storage capacity for electricity produced by solar power.

The Ministry of Finance has had to creatively transfer funds, because the state has not had a new budget approved by the parliament after 2023. The “extended” budget for 2023 is still in use.

Prime minister Pedro Sánchezin the minority government led by socialists has not brought a new budget proposal to the parliament for three years, because the government could collapse on it.

Despite this, the EU Commission has continued to pay recovery billions to Spain.

More EU money is requested

According to the government’s own announcement, Spain has received 55 billion euros in direct grants and 16.2 billion euros in loans from the recovery funds managed by the EU Commission, totaling 806 billion euros, from 2021.

Initially, Spain was promised the opportunity for more than 77 billion euros in grants and around 85 billion euros in loans.

Although even the money received so far has not been used as intended, Spain is still aiming for more. A request for an aid package of over seven billion euros is currently pending.

The grant application period ends in August this year, when the recovery funds are to be closed.

The state does not have to return direct grants received from recovery funds.

They have been financed from the Commission’s market by borrowing a joint debt, the repayment of which is to be handled jointly between 2028 and 2058.

Finland participates in the repayment. Finland’s contribution is estimated to be more than 7 billion euros, although Finland itself has received recovery grants, according to the accounting of the Ministry of Finance, only less than two billion euros.