How long will Rajoy put up with being in office but not in power?

The Spanish parliament’s vote earlier this week to raise the minimum wage from 655 to 800 euros a month - despite the opposition of the governing People’s Party (PP) - highlights the unusual situation that the PP finds itself in, of having to govern in a parliament where a hostile opposition has a majority. 

The proposal by Podemos – with support from the Socialist Party (PSOE) - is far from certain to be implemented; it still needs to go through committee stage and the Senate, and will then likely be vetoed by the government, using a constitutional provision that allows the government to veto hostile legislative initiatives that have budgetary implications. Government has made it clear that it will argue a broad interpretation of what bills are determined to have budgetary implications, going as far as taking this to the Constitutional Court.

Podemos’s political calculation is that through initiatives like this it can assert its claim to be the leading opposition party, and force the PSOE to take sides. Despite abstaining in Rajoy’s investiture vote last month - allowing him to continue as prime minister – the Socialists will want to avoid being perceived as an ally of Rajoy’s. Even the centrist Ciudadanos, who voted in favour of Rajoy in October, abstained on the minimum wage vote, showing that they are at best a critical friend of the government’s.

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The next challenge will be the 2017 budget, where the government needs the support of the centrist Ciudadanos and at least one other party – likely either the Socialists or the Basque nationalists. The government will face the difficulty of attempting to satisfy conflicting demands, the European Commission’s requirements for Spain to reduce the budget deficit, but also those of opposition parties that will demand higher spending or lower taxes. Rajoy may have said that the EU’s deficit targets come first, but ultimately he will need to get other parties to vote for his budget.

Even if a budget can ultimately be approved, governing with a hostile parliament is unlikely to be sustainable for a full term. The opposition is making it clear that it can use its majority to limit – and even repeal – parts of the government’s agenda, putting Rajoy constantly on the defensive. But even in a minority, the prime minister retains the ability to dissolve parliament. Looking at his party’s growing lead in the polls, Mariano Rajoy may be tempted to call an early election – as soon as next year - and get a more amenable legislature.