Aznar takes power with pledge to give it away

Spain's conservative Popular Party leader, Jose Maria Aznar, who narrowly won general elections two months ago, yesterday promised a dramatic transfer of power from Madrid to the regions that he predicted "could unleash a process without historical precedent".

Laying out his programme for government before MPs, Mr Aznar proposed "a new territorial arrangement of power that recognises and respects the different peoples of Spain, their diversity, heterogeneity and the factors that differentiate them". To achieve this, "consensus was more than an aim, it was a necessity".

He also insisted on the urgent need for economic austerity, essential to fulfil the criteria for European monetary union, he said, and to "make up for lost time". But he promised that this too would be achieved through dialogue and consensus.

The outgoing prime minister, Felipe Gonzalez, making his first opposition speech for 13 years, welcomed Mr Aznar's conciliatory tone. He promised he would be critical, but would not trade in insults and devoted much of his reply to emphasising points of agreement.Perhaps Mr Gonzalez was keeping his powder dry, but it was sweetness and light in the first face-off for months between Spain's two leading politicians. "This legislature is going to be much less tense and much more fun than the last," he noted at one point, to laughter and applause.

Mr Aznar is assured of winning the vote today that will instal him as prime minister after sealing pacts with Spain's principal regional forces: nationalists from Catalonia, the Basque country and the Canary Islands. In doing so, he has for the first time united Spain's democratic conservative forces. It is a historic achievement - even if this united front is not guaranteed to hold. For the moment, however, Mr Aznar has secured 25 crucial parliamentary votes that deliver him an absolute majority.

At the heart of his programme lies a formula for increasing regional autonomy, under which Spain's 17 regions will retain 30 per cent of income tax raised in each region. But the details, including a mechanism to prevent the poorer regions from losing out, remain to be worked out.

This commitment, the product of his deal with the Catalan nationalists led by Jordi Pujol, goes beyond anything attempted by any government since the 1978 post-Francoist constitution that recognised the rights of Spain's regions and peoples. It buries what was until 4 March, the day after election day, the most conspicuous legacy of the PP's Francoist origins: the commitment to a centralised "Espanolista" system of rule.

Mr Aznar's choice of words yesterday, his assurance that "each region should reach the maximum levels of self-government", his appeal to "all Spaniards and peoples of Spain", mark an about-turn in approach that reveals the hallmarks of his pact with Mr Pujol's Convergence and Union party. The five MPs of the Basque Nationalist Party (PNV) finally decided this week to climb aboard, after the PP promised to enact in full a devolution deal agreed by the Socialists but not completed.

Mr Aznar promised public spending cuts, deregulation, privatisation and the simplification of bureaucracy that was stifling small businesses, all with the aim of combating "our great national problem" - unemployment, the worst in Europe. Pensions and welfare provisions would be protected, but Mr Aznar demanded more efficiency and less waste.