Sanchez Navigates Budget Challenges Amid Defense Spending Debate

Spanish PM Pedro Sanchez may roll over the budget for another year as passing a new one in the fragmented parliament is unlikely. Facing demands from differing factions, the government plans to increase defense spending and may begin working on a 2026 budget if necessary.

Spanish Prime Minister Pedro Sanchez indicated on Wednesday that his government might extend the current budget for another year. This comes as attempts to pass a new budget this year are increasingly unlikely due to a fragmented lower house.

The coalition, consisting of various parties with often opposing views, finds itself in a tight spot, especially after Sanchez promised to increase defense spending to align with European Union standards—a decision that has divided his cabinet.

Despite pledging to present a budget bill earlier this year, Sanchez is now considering working on a 2026 budget if allies cannot agree by May. Meanwhile, he is under criticism for suggesting that defense spending could be increased without parliamentary approval.

(With inputs from agencies.)