The management of the public sector is subject to the system of an annual budget approved by the Spanish Parliament and based on the principles of budget stability, multi-annual nature, transparency and efficiency. The multi-annual nature is to strengthen the budget forecast and standardise the procedures for all Civil Service Departments with stability and growth programmes; transparency that enables the budget stability to be verified and finally efficiency in the allocation and use of the public resources that must guide spending policies.
We can define the budget as the set of rights (revenue) and obligations (expenditure) to settle over the financial year by each of the bodies and organisations that make up the state public sector.
The Social Security is in accordance with Art. 2 of Law 47/2003 of 26 November, on the General Budget, is part of the public sector and therefore must be provided with an annual budget governed by these principles, which is integrated into the General State Budget and is approved by law.
For 2012, Law 39/2010 of 22 December, on the General State Budget, has set a budget of €124,408.08 million with favourable results that enables €3,456.90 million to be allocated to the Reserve Fund, which will be 6.5% of GDP, with a view to guaranteeing the future stability of the system. This is possible thanks to the financial reforms and the reforms of the pension system that have taken place, which have enabled contributive fairness to increase at the same time as improving benefits, effectively helping social cohesion and the redistribution of income.
In the specific area of Social Security, we can define its budget as the set of obligations that the agents who make up the System´s institutional administration have to meet in a financial year, when carrying out the activities they are responsible for and the rights that they expect to settle in said year to financially cover the benefits and services that have to be granted under the scope of its protective action.