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Spanish PM refuses to resign in corruption scandal

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(Globalpost/GlobalPost)

Spain's Prime Minister Mariano Rajoy on Monday refused to resign over a corruption scandal rocking his government as it fights to rescue the eurozone's fourth-biggest economy from an economic crisis.

He batted off calls from his political opponents to step down over allegations that he received secret payments through his Popular Party before he became premier in 2011.

Pressure intensified on Rajoy, 58, when the man supposedly behind the payments, the party's jailed former treasurer Luis Barcenas, defended his allegations for the first time formally in court on Monday.

Barcenas told an investigating judge that he had handed 25,000 euros ($33,000) in cash to Rajoy in 2010 and the same amount to the party's deputy leader Maria Dolores de Cospedal, sources present at the hearing told reporters afterwards.

The grey-bearded premier has denied any wrongdoing in the growing controversy, which first erupted in January when a newspaper published copies of account ledgers purportedly showing irregular payments to top party members.

Further leaks later implicated Rajoy himself and fresh allegations in the press over recent days reignited calls from his political opponents for him to resign.

But a defiant Rajoy told reporters on Monday: "I will fulfil the mandate the Spanish people gave me."

He vowed to "defend political stability" as he steers Spain out of a deep recession and fights to stabilise its public finances.

Rajoy pointed to the strong parliamentary majority he has enjoyed since leading the party to a landslide electoral victory in November 2011, which has enabled him to push through tough economic reforms.

Cospedal later stepped up to explicitly deny the latest allegations by Barcenas, who is in jail pending a probe into separate corruption accusations.

"Faced with these new calumnies and lies presented by Luis Barcenas in court, I wanted to appear before you all today to deny emphatically all the accusations he has made against the prime minister and myself," she told a news conference.

The noose had appeared to tighten on Rajoy on Sunday when the conservative newspaper El Mundo published friendly text messages he purportedly sent to Barcenas from May 2011 to March 2013, some two months after the scandal erupted.

"Luis, I understand, be strong. I will call you tomorrow. Best wishes," said one of the messages from Rajoy to Barcenas, dated January 18 when El Mundo first published allegations over the slush fund.

On Monday, a police van delivered the 55-year-old Barcenas from his prison outside Madrid to the High Court to be quizzed by Judge Pablo Ruz as protesters outside yelled "Thieves!"

Barcenas was summoned after El Mundo last week published what it said was an original page from his hand-written slush fund ledgers.

The excerpt purportedly showed extra payments from a secret fund to party officials including Rajoy when he was a minister under then prime minister Jose Maria Aznar in 1997, 1998 and 1999.

Media reports have suggested the slush fund was financed by corporate donors who were then rewarded with public contracts.

Leading daily El Pais in January published photocopies of the purported ledgers, in which Rajoy appeared as having received a total of 25,200 euros a year between 1997 and 2008.

The Popular Party has repeatedly denied the secret financing allegations.

The leader of Spain's main opposition Socialist Party, Alfredo Perez Rubalcaba, on Sunday accused the premier of "serious collusion" with Barcenas.

"Given the unsustainable political situation in Spain, the Socialist Party calls for the immediate resignation of Mariano Rajoy as head of the government," he said.

The corruption allegations have outraged Spaniards suffering in a recession, with a record unemployment rate of more than 27 percent.

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http://www.globalpost.com/dispatch/news/afp/130715/spanish-pm-refuses-resign-corruption-scandal-0