Spanish PM admits error of trust in graft scandal

AFP, MADRID

Fri, Aug 02, 2013 - Page 7

Spanish Prime Minister Mariano Rajoy admitted for the first time yesterday that he made a mistake in trusting a party colleague at the center of a major corruption scandal, but denied any wrongdoing and vowed to stay in power.

Rajoy, 58, was in fighting mood as he appeared in parliament, pouring scorn on calls for his resignation over allegations surrounding his ruling Popular Party’s disgraced former treasurer, Luis Barcenas.

“I made a mistake in maintaining confidence in someone who we now know did not deserve it,” said Rajoy, who for months had resisted even pronouncing Barcenas’ name in public.

The gray-bearded prime minister said he was appearing before the special session of parliament to “refute the lies, manipulations and malicious insinuations encouraged by certain political leaders.”

The Spanish prime minister said the conservative Popular Party did pay its officials extra money in addition to their salaries for “work done,” but he denied allegations that he received illegal payments from his party and said he paid taxes on all his income.

“Nothing related to this matter has prevented me, nor will it prevent me from governing,” the prime minister told parliament, which opened with a minute’s silence for the 79 people killed in a July 21 train derailment near Santiago de Compostela in northwestern Spain.

Rajoy, who took power after leading his party to a landslide election win in November 2011, said ledgers published in the press supposedly showing slush fund payments to him and other party members were “an astonishing and imaginary collection of falsehoods.”

The affair threatens to destabilize his government, which is battling to strengthen the public finances of the eurozone’s fourth-biggest economy, anxiously watched by its neighbors.

Rajoy’s appearance followed months of damaging leaks in the press and pressure from political opponents, who threatened a no-confidence vote.

The corruption affair originated in 2009 as a judicial investigation into alleged kickbacks involving members of the Popular Party and construction companies.

It exploded in January when leading daily El Pais published copies of account ledgers purportedly showing the irregular payments to top party members, including Rajoy, who has led the party since 2004.

Those allegations sparked outrage among ordinary Spaniards struggling with spending cuts that Rajoy has imposed during a deep recession.

Barcenas was jailed last month pending an investigation into a separate corruption case, in which he is alleged to have held secret Swiss bank accounts.