Spain to roll over 2023 budget for rest of this year and focus on 2025, source says

MADRID (Reuters) -Spain's government has decided not to send an already delayed budget bill for 2024 to parliament and will focus instead on next year's spending plan as it keeps rolling over the 2023 budget, a government source told Reuters on Wednesday.

The source confirmed earlier reports by El Pais newspaper and several other outlets saying Prime Minister Pedro Sanchez made the decision after the Catalonia region called an early election earlier on Wednesday that could throw his support in parliament into disarray.

Sanchez's minority leftist government is dependent on unstable parliamentary backing from Catalan pro-independence and other regional parties to pass legislation.

The 2024 budget process was delayed last year as it took Sanchez four months to secure another term in office after an inconclusive general election in July.

The source said in a pre-election climate, pushing the budget through parliament quickly was no longer considered feasible, adding that "budgets in June don't make much sense".

Budget Minister Maria Jesus Montero earlier told Cadena Ser Radio the Catalan election "could change the political chessboard" and "the sensible thing, being realistic, is to make use of all the technical work and political pre-agreements as a starting point for the 2025 (budget) proposal".

The government has targeted reducing the budget deficit to 3% this year from 2023's 3.8%. The central bank projected on Tuesday it would drop to 3.5% this year, noting that for Spain to meet the EU recommendation that nominal growth in expenditure does not exceed 2.6%, additional measures may be necessary.

(Reporting by Andrei Khalip and Joan Faus; Editing by Toby Chopra and Jamie Freed)