What the Approval of a Controversial Amnesty Law Would Mean for Spain

(JAVIER SORIANO/AFP via Getty Images)

Spanish Prime Minister Pedro Sanchez leaves during a break of the plenary session before a vote on the government's controversial amnesty bill for Catalan secessionists at the Congress of Deputies in Madrid, Spain, on Jan. 30, 2024.

If the Spanish parliament approves an amnesty law for Catalan secessionists in the coming days, it will secure the stability of Prime Minister Pedro Sanchez's government and open the door to tax reforms. The justice committee of the Spanish Chamber of Deputies will meet on March 7 to vote on an amnesty law proposal that would cover hundreds of Catalan politicians and activists involved in the region's push for independence over the past decade. If the committee approves the proposal, the full Chamber of Deputies will debate and vote on it next week. The amnesty law is the cornerstone of the political alliance between Prime Minister Sanchez's Socialist Party (PSOE) and two Catalan political parties, the right-wing Together for Catalonia (commonly known as 'Junts') and the left-wing Republican Left of Catalonia (ERC), whose support Sanchez needs to pass legislation. In late 2023, the Junts and the ERC voted in favor of Sanchez's investiture for another four-year term as prime minister in exchange for an amnesty law covering the hundreds of people involved in events, including the illegal independence referendum and the unilateral declaration of Catalonia's independence in 2017.

Spain held a general election in July 2022, in which the PSOE ended in the second position with only 121 of the 350 seats in the Congress of Deputies. This forced the PSOE and its junior ally, the left-wing Sumar party, to reach a deal with the Junts and the ERC to re-appoint Sanchez as prime minister. In addition to multiple financial concessions to Catalonia, Sanchez also promised an amnesty law in exchange for the Catalan parties' support. Sanchez won a vote of investiture in November 2023, with 179 votes in favor and 171 against.
In late January, the Chamber of Deputies rejected a first version of the amnesty law with 179 votes against and 171 votes in favor. This happened because the Junts joined the opposition and voted against the law, arguing that it did not fully protect the party's leader, former Catalan regional president Carles Puigdemont, from arrest over accusations of terrorism. Puidgdemont fled Spain after the unilateral declaration of independence in 2017 to avoid being arrested, and has not returned to the country since. Spain's Supreme Court is currently investigating Puigdemont for potential acts of terrorism, a crime that was not covered by the original wording of the amnesty law.

While last-minute disputes could still derail the amnesty law, the PSOE, the Junts and the ERC are all interested in its approval. According to the Spanish government, the updated amnesty bill will only introduce small tweaks compared with the version that was rejected, and will not make any drastic changes on the issue of terrorism. This means the Junts may reject it again, though the party does not want to trigger a political crisis that could destabilize the Sanchez government and result in an early general election where the right-wing opposition may win. Opinion polls suggest that the center-right People's Party (PP) and the right-wing Vox party may win enough seats to form a coalition government if there is an early general election. Both parties are very critical of Catalonia's push for independence, and may backtrack on some of the fiscal promises that Sanchez made to the Junts and the ERC in exchange for their support. This means there is a high chance that the Congress of Deputies will pass the law. After that, the law would move to the upper chamber of the Spanish parliament, the Senate. The PP controls a majority of seats in the Senate, a position it will use to delay the approval of the amnesty law. Still, the Senate can delay legislation or send it back to the Chamber of Deputies, but it cannot veto it, which means that if the Chamber of Deputies approves the amnesty law next week, and even if the Senate delays its ratification, it would probably enter into force by around May. This would not necessarily be the end of the debate, however, as Spanish judges could take the law to the European Court of Justice, which could eventually declare it illegal. Still, this is a process that could take years, and in the meantime, the law would remain applicable.

In late 2023, as a part of the post-election negotiations, Sanchez agreed to forgive 15 billion euros ($16 billion) owed by Catalonia to the central government. He also promised millions of euros of infrastructure investment in Catalonia. In addition, Sanchez agreed to transfer control of the Rodalies commuter rail network from the central government to the Catalan regional government — a long-standing demand for pro-independence parties.
Multiple opinion polls published between late February and early March have the PP at 37-38%, up from the 33.1% it received in the 2023 general election. On the contrary, the PSOE is at 28-29%, down from the 31.7% it secured in the general election. On Feb. 18, the PP obtained 47% of the vote in the regional election in Galicia, while the PSOE only obtained 14%.

The passing of an amnesty law will secure the stability of the Spanish government in the short-to-medium term, including the approval of a budget for 2024 to reduce the country's fiscal deficit. The PSOE-Sumar alliance does not have enough seats in parliament to pass legislation, while a recent series of corruption scandals has negatively impacted the government's popularity. This means that the approval of the amnesty law will secure support from the Junts and the ERC, which will enable the government to control a majority of seats in the Chamber of Deputies and remain in power. This will enable Madrid to pass legislation, most notably the budget for the 2024 fiscal year, which the ongoing negotiations over the amnesty law have delayed. One of the main goals of the budget will be to take Spain's fiscal deficit to 3% of GDP in 2024, down from around 3.9% in 2023, and in line with EU fiscal rules. In 2025, the European Union will introduce an updated set of fiscal rules (the old rules were suspended in 2020 so that member states could increase fiscal spending to deal with issues such as the COVID-19 pandemic and the energy crisis), and Madrid wants to avoid any potential pressure from Brussels. The Sanchez administration will also need parliamentary support to pass tax reforms, including measures to exempt some low-income households from the income tax and to turn what were originally meant to be one-off taxes on banks and energy companies into permanent taxes. However, the passing of the amnesty law will likely infuriate the PP and Vox, which will probably call for protests. The law may also damage Sanchez's re-election prospects the next time there is a general election, as polls suggest that the issue is very controversial among Spanish voters.

Should the PSOE, the Junts and the ERC fail to agree on an amnesty law, and should the Congress of Deputies reject it, Sanchez would still be able to remain prime minister at the helm of a minority government. However, this government would be very limited in terms of policymaking, and would need to, for example, extend the 2023 budget into 2024, which would bar Madrid from implementing its promised tax reforms. This means that the rejection of the amnesty law would increase the possibility of an early general election, even if it may not happen immediately.
While Catalonia's push for independence has lost steam in recent years (in part because of the PSOE's cordial ties with the Junts and the ERC), the Junts and the ERC still demand a legally binding independence referendum. If the amnesty law is passed, these calls will remain manageable for Madrid, even if they will not go away completely. If the amnesty law is rejected, and especially if the PP takes over after an eventual early election, calls for such a referendum will grow louder. Even in this case, a unilateral declaration of independence is unlikely in the short-to-medium term, considering the failure of the 2017 attempts.