Spain Opposition Seen Close to Get Votes to Topple Rajoy

(Bloomberg) -- The Socialists, Spain’s biggest opposition party, are close to lining up the support they need to oust Prime Minister Mariano Rajoy in a no-confidence vote Friday, according to people briefed on the talks.

Catalan separatists are highly likely to side with the Socialist party when their leadership meets in Barcelona Wednesday, according to one person briefed on their discussions. The Basque Nationalists are planning to take their lead from the Catalans when they take a final decision in the regional capital Vitoria on Thursday morning, said another person. Neither party has taken a firm decision yet. A Socialist party press officer declined to comment.

The Basque Nationalists, or PNV, have a cordial relationship with Rajoy and they will tell him in advance if they plan to vote against him so that he can opt whether to resign rather suffer a public defeat in parliament, one of the people said. His resignation would mean an acting government led by Rajoy’s People’s Party would run the country until fresh elections are held.

With the anti-establishment group Podemos already onside, support from the Basques and the Catalans would mean Socialist leader Pedro Sanchez has the votes to take power in the event that Rajoy doesn’t resign. Senior officials at Rajoy’s People’s Party are starting to see defeat as the most likely outcome, said a third person briefed on their thinking.

The precarious balance of political forces that had held for 18 months in Spain was upended last week when former PP aides were convicted of running a corruption racket when Rajoy was opposition leader.

Just a day after voting alongside the PP and the Basques to pass the delayed 2019 budget, the centrist group Ciudadanos withdrew its support for the minority administration and demanded a snap election. The Socialists called on the prime minister to resign and filed the no-confidence motion.

Senior officials from the Socialist party met with the Basques in Madrid Tuesday with the Basques looking for firmer commitments that Sanchez will deliver more spending to their region and hold off elections, according to a separate person briefed on those talks. A spokesman for the Basques didn’t immediately respond to calls seeking comment.

Weak Spot

But the Basques have already taken a hit in their home region after helping Rajoy pass a budget and they are concerned that their left-wing rival, Bildu, would make significant gains if they backed the conservative leader again, according to the person.

The only scenario in which the Basques could risk staying out of the Socialist-led bloc would be if the Catalan separatists also backed away at the last minute. A person close to the Catalans’ leadership said such a decision was very unlikely, even though the outcome hasn’t been completely closed.

Both the Basques and the Catalans are wary of fresh elections because the biggest beneficiary would most likely be Ciudadanos leader Albert Rivera, who has pledged to keep regional powers in check and review the Basques’ special funding arrangements.

Ciudadanos is the fourth biggest party in the current legislature but has been leading in polls this year as voters desert Rajoy’s PP and reward its opposition to Catalan separatists. The first poll conducted since last week’s convictions showed Ciudadanos leading the Socialists by 28.5 percent to 20.3 with the PP slumping to fourth with 16.7 percent.

In parallel negotiations with Ciudadanos, the Socialists are discussing replacing their existing no-confidence motion with one that would explicitly set the country on course for a snap election. Their initial positions see a vote either in October or next May, according to one person briefed by negotiators. Still, that person said it’s more likely that Sanchez gets the votes he needs from the Basques and the Catalans.

The Great Survivor

Appearing before parliament on Wednesday, Rajoy told the Catalans and Ciudadanos that Sanchez was playing them off against each other.

“You are both being blackmailed,” the prime minister said. “Let’s see who gives in.”

Rajoy has proved himself to be the great survivor of Spanish politics since he became party leader in 2004. He lost two general elections before becoming prime minister in 2011 and survived the loss of his parliamentary majority in 2015 to take office for a second term in October 2016. Rajoy told lawmakers Wednesday he intends to see out his four-year term.

--With assistance from Maria Tadeo.

To contact the reporter on this story: Esteban Duarte in Madrid at eduarterubia@bloomberg.net

To contact the editors responsible for this story: Alan Crawford at acrawford6@bloomberg.net, Charles Penty, Tony Czuczka

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