Tuesday, July 5

Competition recognizes communication errors with the new electricity bill and blames the rise on CO2

Last day of the UIMP summer courses and shift for supervisors. Among them, Cani Fernández, head of the CNMC, has participated, who has addressed the open public debate about the new electricity tariff and the historical rise in electricity prices, which have led the Government this week to approve a temporary decrease of taxes to try to contain the increase in the hike. Fernández has acknowledged that errors have been made in the communication of the new tariff model, although he has blamed the increase in costs on other external factors, such as the rise in the cost of CO2.

“We have not explained ourselves well with the time slots,” acknowledged Fernández, who was participating for the first time in this annual forum. “We have done something wrong and we have taken note,” he assured, raising the possibility that in the future this type of relevant changes in aspects such as electricity “will be made progressively.” Fernández has vindicated the hourly model used to reduce consumption at peak hours, avoiding having to deal with new investments in networks “that must be paid for”. “We have to check if there is a change in behavior and consumption habits,” he emphasized.

Although, the head of the CNMC has unlinked the change in the electricity bill with a rise in electricity prices, which has caused an increase in the rate. This has been attributed to the increase in external costs that do not depend on the invoice. “The increase in the price of CO2 has caused an increase in the price of energy, which has made the benefits of the new bill not appreciated,” said Fernández, defending that the new rate model seeks to lead to the decarbonization of consumption of energy.

The first to participate this Friday has been Rodrigo Buenaventura, who for a few months assumed command of the National Securities Market Commission. In its first appearance at this annual event that brings together some of the leading figures from the country’s banking and business sector, Buenaventura has warned of new risks that are appearing in the financial market after the pandemic and, specifically, an increase in fraud.

The head of the supervisory body has analyzed that, with the increase in household savings, campaigns to attract investors are increasing and some of them are engaging in illegal or even fraudulent activities. “Fraud phenomena have increased,” Buenaventura has warned. “We have detected a peak in inquiries and complaints on these matters,” he added, noting that “there is a breeding ground that can accelerate this type of behavior.”

The CNMV estimates that there are already legalized claims against these frauds that exceed 800 million euros. Although it does not represent all the cases known to the supervisor, Buenaventura has recognized that crypto assets are protagonists. He attributes it to the fact that traditionally these criminal campaigns seek to attract with “fashionable” products and that is now these complex financial assets, as in their day were gold or oil. “I do not want to link fraud and crypto assets, but it is true that they overlap,” Buenaventura assured.

The head of the supervisory body, who has succeeded Sebastián Albella, has assured, as Minister Nadia Calviño has already advanced in the same forum, that both the CNMV and the Ministry are working on new regulations that prevent financial fraud. Buenaventura has highlighted that the main tools included in the future law should help the “empowerment” of the consumer that allows them to discern between regulated offers and those that are fraudulent or unsupervised.

Buenaventura has also referred to the recent indictment of Ignacio Sánchez Galán, president of Iberdrola, for the contracts with former commissioner Villarejo. The head of the CNMV has avoided assessing whether the manager should leave the position in the company, although he has urged the listed company to assume good corporate governance commitments. The speaker has stressed that this type of case, in addition to affecting the credibility of the company itself, can be extended to the rest of the listed companies. “Sometimes reputational wear is a risk for companies but also for all listed companies,” he pointed out.

The Bank of Spain asks for “prudence” with the SMI

The last participant in the aforementioned summer courses has been the Governor of the Bank of Spain, Pablo Hernández de Cos, who has analyzed the challenges facing the Spanish economy after the pandemic and has urged, as he has done on other occasions, the Government to to carry out a project to reduce the imbalances of public accounts, although it has not wanted to advance whether it should be done on the side of an increase in income (tax reform) or expenses (cuts).

If the manager of the financial sector supervisor has valued it is the Minimum Interprofessional Salary. The agency published last week a document in which it exposed the impacts of job loss due to the latest rise in a report published in full negotiation in the Government to raise it again this year. Hernández de Cos has defended the report as “an evaluation of public policies.” Regarding a new rise, he has avoided assessing what the decision should be, whether to keep it frozen or raise it, although he has requested “prudence” from the Government since the “main affected” by this policy are also the main victims of the economic crisis caused by the pandemic.

The governor has also addressed the situation of large layoffs and office closures that are taking place within the banking sector and, as did the vice president of the ECB, Luis De Guindos in the same forum, Hernández de Cos has justified this process . “The sector has a profitability problem, not only in Spain, in Europe, low profitability and overcapacity,” he emphasized. “An unprofitable banking sector will cause us a financial stability problem and we all know how these problems end.”