July 15, 2013 11:10 am

Bárcenas testifies as Spain’s political crisis deepens

Spain’s political class was holding its breath on Monday, as the former treasurer of the ruling Popular party appeared in court to shed new light on the slush fund scandal that has rocked both the party and the government in recent months.

Luis Bárcenas, the disgraced veteran PP official at the centre of the affair, arrived in court in the late morning, and was expected to answer questions from the investigating judge for at least several hours. The former treasurer has been under investigation since prosecutors discovered earlier this year that he amassed as much as €48m in bank accounts in Switzerland and elsewhere. Mr Bárcenas was arrested and jailed late last month, after the court ruled that he was a flight risk.

His latest appearance in court has sparked unusual interest, because it follows a string of revelations in the Spanish media – prompted by Mr Bárcenas himself – that suggest the former treasurer is ready to provide a detailed account of how the PP engaged in illegal party financing.

He already confirmed the bulk of allegations raised against the PP in an interview with the El Mundo daily early this month. Mr Bárcenas said the party broke campaign finance laws for more than 20 years, by accepting cash donations from construction companies and other businesses and channelling part of that money into a slush fund. Senior party officials received quarterly cash payments from this fund, Mr Bárcenas added.

According to leaked ledgers that purport to show the payments made from the secret party fund, the recipients included Mariano Rajoy, the current Spanish prime minister. Both Mr Rajoy and other party leaders deny the accusations.

Mr Rajoy on Sunday faced a fresh barrage of calls to resign over the scandal, after it emerged that the prime minister sent supportive text messages to Mr Bárcenas two months after the scandal broke.

Alfredo Pérez Rubalcaba, the leader of the opposition Socialists, called for the “immediate resignation” of Mr Rajoy, and warned that his refusal to stand down was causing “incalculable damage to a country that is living through difficult moments”. His call was echoed by other opposition leaders. The Socialists also declared that they would no longer co-operate with the Rajoy government, only weeks after the two sides issued a joint declaration setting out Spain’s interests ahead of the June European summit.

The latest attacks on the government follow the publication of several mobile phone text messages that were sent between Mr Rajoy and the former treasurer. According to El Mundo, the Spanish daily that obtained the SMS exchange, the two men were in contact at least until March this year – almost two months after the scandal broke.

In the last message published by the paper, Mr Rajoy is apparently trying to calm down his former treasurer: “Luis, I understand. Keep courage. I will call you tomorrow. A hug,” the message reads.

Though the messages do not shed new light on the substance of the case, they back up opposition allegations that Mr Rajoy and the rest of the PP leadership were reluctant to distance themselves from the man at the centre of the scandal. They are likely to further weaken the standing of the government at a time when senior ministers are desperate to convince voters and foreign investors that Spain’s long-suffering economy is finally turning the corner.

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