· Published in RecoveryWatch

Hyper-confidence in digitalisation and technology dominates the “España Puede” Recovery, Transformation and Resilience Plan

When the European Commission (EC) presented its NextGeneration EU assistance package in July 2020, it was widely applauded by governments and business councils. €750 billion euros to finance the post-pandemic economic recovery and to invest in a green, digital transformation of the European economy. Almost a year later, the proposal has been embodied in 27 national recovery and resilience plans which the European Commission has until today to approve. In the case of the Spanish State, approval has already been received from Brussels a couple of weeks ago for the “España Puede” [Spain Can] Recovery, Transformation and Resilience Plan, giving the green light to Pedro Sánchez’s government’s proposal and its investment and reform plan financed with €69.5 billion euros in European subsidies.

In a time of multiple emergencies, the injection of large quantities of public money into the private sector to bail it out and transform it is not a merely economic decision, but a question of environmental and social justice which will affect everyone in one way or another. With this in mind, the government’s immeasurable confidence in digitalisation and technology as a strategy to solve this country’s problems should raise eyebrows. It is a highly questionable strategy, both due to the social and environmental impacts caused by the process of digitalisation (understood as the process of transforming analogue activities into digital activities using microelectronics, telecommunications, computer architecture, robots and software; and related to big data, artificial intelligence and the internet) and because this strategy has been chosen in Moncloa, without sufficient collective, democratic debate.

To begin with, it is astounding how much money is dedicated to projects aiming to digitalise processes and sectors. In total this represents 28% of the funds, much more than the European Commission requires Member States to allocate (the minimum allowable is 20%). What is more, digitalisation is proposed wherever there is a need for modernisation (for example, in the case of industry, administration and the social sector), without in-depth analysis of structural problems or attempts to develop alternative, more resilient socio-economic models, such as sovereignty-based production and consumption models (for example, organic subsistence agriculture or the production of essential products such as healthcare goods within autonomous territories and states themselves).

Based on this assumption that modernisation is the same as digitalisation, component 12 of the Spanish Industrial Policy 2030 proposes investments and reforms to digitalise strategic sectors – a total of €3.7185 billion euros, the lion’s share of which will go to the automotive, tourism, retail, agriculture and healthcare sectors. In addition, component 3 proposes the Plan for Sustainability, Research, Innovation and Digitalisation in the agriculture and fisheries sector, costing €95 million. In the tourism sector, which has shown itself to be highly vulnerable to external impacts like Covid-19, an extra component (no. 14) is dedicated to digitalisation: €337 million to “continue attracting more and more hyperconnected tourists on stays with increased added value”.

In the social components (education, health and care - sectors which have shown themselves to be vital to the maintenance of life during the pandemic), we again see this hyper-confidence in digitalisation and technology as a solution to structural problems. Instead of employing more people, improving working conditions for workers in the social sector, improving services for vulnerable groups and so on, the subsidies are being spent on upgrading digital infrastructure and equipment in education (€146.8 million) and investing in healthcare equipment (€796 million) and equipment and technology for care (€2.0839 billion).

It is beyond doubt that there is a real need in administration to modernise processes and improve transparency, just as there is a real need to support SMEs through this economic crisis. However, the “España Puede” Plan mainly offers these two sectors subsidies to digitalise processes and jobs: €3.7815 billion for administration (component 12) and €3.547 billion for the digitalisation of SMEs, 72.5% of the component 13 budget.

This hyper-confidence in digitalisation and technology in a “national plan” is dangerous. Firstly, it does not give the push required to truly transform the productive model into a more resilient form, but only modernises certain sectors and processes. Secondly, it is completely blind to the social and environmental impacts which accompany digitalisation, which many experts are already flagging up.

In terms of employment, digitalisation and automation will lead to workforce restructuring. A World Economic Forum study, “The Future of Jobs”, which is based on the assumption of infinite resources, claims that 43% of companies are planning to reduce staff numbers through technological integration, 41% are planning to outsource specialist work and in contrast only 34% are expecting to take on more staff. By 2050, companies predict 47% of jobs will be digitalised or automated. What is more, the same World Economic Forum study recognises the impact on the gender division of work in terms of the types of job which are being promoted: there is a much lower percentage of women in work related to digitalisation. If the subsidy of digitalisation in companies with public money is not accompanied by the obligation to maintain employment, if public policies reducing the length of the working day are not introduced or if there are no massive reskilling programmes, we will face a considerable increase in unemployment in the coming years.

Digitalisation and the roll-out of new technologies also have grave environmental impacts which the Government has never addressed. Big data storage is very energy intensive and emits CO2. We have built a service economy which feeds on data stored in servers in other parts of the world, which means we are externalising our environmental and climate impacts. What is more, the massive extraction of minerals required for the digital transition such as lithium, cobalt and so on will aggravate conflicts and human rights abuses in the places where they are mined (largely in the Global South). What is more, Pedro Sánchez’s government does not even consider the biophysical limits of the planet in this digital transition. The European Commission itself shows in its 2020 inventory of critical raw materials that, for example, we would need 18 times as much lithium in 2030 and 60 times as much in 2050 to implement the European green, digital transformation strategy.

Considering the lack of solutions to structural economic problems and the lack of consideration of the international, environmental, social and gender impacts of digitalisation, there are serious reasons to doubt whether the Government’s proposal will bring about an economic transformation which benefits the planet and the majority of the population. Less techno-optimism, more courageous, transformative proposals focused on long-term resilience and especially more democratic debate about which path is right for our economy and society are essential elements of a recovery process and the creation of a “national plan”.