Taking action in Madrid

The autonomous community of Madrid has almost seven million inhabitants who are served by 34 public, and 48 private, hospitals. As a result of the COVID-19 pandemic, the region’s health and social care systems have come under tremendous strain, resulting in increased needs for medical facilities, equipment and staff. In fact, Madrid expects to spend over €2 billion in extraordinary expenditure on health and social services related to COVID-19. 

Support from the CEB 

In March the regional government launched a COVID-19 Action Plan, which included a range of measures to cope with the influx of patients, and in mid-April the CEB approved a PFF loan. This was done by written procedure as part of a fast-track mechanism established by the Bank in response to the coronavirus crisis. The PFF was the first loan agreement signed between the CEB and a European region during the pandemic, and will be used to part-finance Madrid’s extraordinary expenditure on health and social services related to COVID-19 such as: 

• Hiring of additional medical staff such as doctors, nurses and auxiliary nurses as well as overtime expenses
• Hiring of 400 new COVID-19 hotline operators (the hotline has seen daily calls surge from around 70 to 7,000)
• Additional medical and pharmaceutical supplies, such as medicines or diagnostic tests
• Specialist equipment needed for COVID-19 patients such as additional intensive care beds, ventilators, face masks, gloves, and hand sanitiser
• Strengthening of services in care homes for the disabled and elderly

Funding the conversion of IFEMA 

CEB funds will also be used to part-finance the conversion of Madrid’s conference centre, IFEMA, into the biggest hospital in Spain. This field hospital became operational on 23 March and has treated more than 4,000 patients with mild symptoms to prevent the spread of the virus and reduce the pressure on hospitals. It had a capacity of up to 5,000 beds and was closed on 1 May.

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In discussion with... Javier Fernández Lasquetty, Regional Finance Minister

Info: How has the Madrid region responded to the COVID-19 crisis? 
JFL: The Madrid region began to take measures to protect the population before the Spanish Government decreed the state of emergency. Among many other measures, we approved the closing of educational centres and centres for the elderly, and facilitated teleworking among public servants. 

In the health sector, the largest field hospital in Spain was created in barely two days at IFEMA, and was recognised by the WHO as ‘extraordinary’. 

Our health workforce has been reinforced with the recruitment of 10,000 people. In addition, we have managed to bring ten aircraft with medical supplies/equipment to the region, which have brought more than 500 tons of necessary resources for our hospitals and medical centres. 

We have also implemented economic and fiscal measures to help companies and the self-employed, so that they have liquidity and can maintain their activity. We have also approved the postponement of the payment of taxes managed by the region of Madrid while the state of emergency is maintained. 

In short, we have adopted preventative measures, we have made, and we are making, a very important effort at the health level to combat the pandemic and we have designed a package of measures so that companies and the self-employed in the region are affected as little as possible. 

Info: What are the priorities covered by the loan? 
JFL: The loan signed with the CEB has a specific purpose: to finance the health expenditure arising from COVID-19. We are talking about the purchase, among other things, of equipment and materials to treat patients with coronavirus and to protect our health workers, and to set up health infrastructure, such as IFEMA. In addition, we have expanded the health workforce with the hiring of 10,000 people, who we will keep on staff throughout 2020. All this requires financial support as it is generating extraordinary expenses that we estimate at €2 billion. 

Info: What difference has it made to the region to be able to obtain this funding rapidly? 
JFL: We are very grateful for the CEB’s support. 

We are the only European region that has received funding from the Bank. 

This reflects, on the one hand, the sensitivity of the CEB in the fight against COVID-19 and, on the other, the trust in the region of Madrid and its ability to meet its obligations. We are the Spanish region with the lowest debt (14%), together with the Canary Islands, and we have managed to meet the deficit target for 2019.