50 million from SEPE for municipalities in Andalusia and Extremadura: hiring unemployed people in reconstruction

Key data

Municipalities in Andalusia and Extremadura affected by adverse weather phenomena can now access a direct SEPE grant to finance the hiring of unemployed people for reconstruction work. The Royal Decree 608/2026, published on July 30, 2026, regulates this direct allocation of 50 million euros and has been in force since the day of its publication.

The grant is direct—without competitive bidding—under the General Subsidies Law, justified by reasons of urgency and public interest. The beneficiary municipalities were previously identified by the Evaluation Commission of RDL 5/2026, so it is not necessary to prove the impact again: it is sufficient to request the grant within the established deadline.

What does this regulation establish?

Royal Decree 608/2026 regulates three fundamental aspects:

• What is financed: salaries of hired unemployed workers, employer contributions to Social Security and joint collection concepts associated with those hirings. The objective is for the complete labor cost to be covered by the grant.
• Who can receive it: exclusively local corporations (municipalities) in Andalusia and Extremadura that were identified by the Evaluation Commission of RDL 5/2026 as municipalities affected by adverse weather phenomena, considering the magnitude of damages, the municipality's financial situation and evacuations produced.
• How the amount is calculated: each municipality has a guaranteed minimum amount of 11,124 euros, to which is added a proportional share calculated based on three variables: municipality population, registered unemployment and estimated cost of damages. Additionally, if funds remain available after attending to all requests, there is an additional amount assigned by order of application.

Economic and operational impact

For affected municipalities, this grant means being able to hire local unemployed people for reconstruction work at no labor cost to municipal budgets: SEPE covers the full salary plus social contributions charged to the employer. This is especially relevant for small municipalities with limited budgets and substantial damages.

Direct allocation eliminates the risk of exclusion by competitive criteria: all municipalities identified by the Evaluation Commission of RDL 5/2026 have the right to the minimum amount of 11,124 euros. The variable share can significantly increase that amount in municipalities with larger population, higher unemployment or more severe damages.

The only competitive element is the additional amount, which is distributed by order of application if funds remain after attending to all requests. This makes the speed of submitting the application a relevant economic factor for municipalities seeking to receive beyond the guaranteed minimum and proportional share.

Who does it affect?

• Municipalities in Andalusia and Extremadura included in the list of affected municipalities approved by the Evaluation Commission of RDL 5/2026.
• Unemployed people residing in those municipalities, who may be hired for works and services of general interest linked to reconstruction.
• Municipal technicians and managers (secretaries, comptrollers, HR managers) who must process the application and manage hirings.
• Advisors and consultants in local administration providing services to affected municipalities.

It does not affect private companies, self-employed workers or non-profit entities: the exclusive beneficiary is the local corporation.

Practical example

Imagine a municipality in Extremadura with 3,500 inhabitants, a high registered unemployment rate and damages valued at 800,000 euros from flooding. This municipality:

• Has guaranteed 11,124 euros as the minimum amount, regardless of any other factor.
• Will additionally receive a proportional share calculated on its 3,500 inhabitants, local registered unemployment and the 800,000 euros in damages. The higher each of these three parameters in relation to the set of beneficiary municipalities, the greater its proportional share.
• If it submits its application before other municipalities and funds remain available after distributing the guaranteed and proportional amounts to all, it may also access the additional amount by order of arrival.

With those funds, the municipality can hire local unemployed people for cleaning tasks, infrastructure repair or conditioning of damaged public spaces, without salary costs or social contributions falling on the municipal budget.

What should municipalities do now?

1. Verify if the municipality is included in the list of beneficiaries approved by the Evaluation Commission of RDL 5/2026. If the municipality was affected and appears on that list, it has the right to the grant.
2. Prepare the application documentation as soon as possible: the additional amount (above the guaranteed minimum and proportional share) is assigned by order of application, so speed is a direct economic factor.
3. Identify local unemployed people eligible to be hired for reconstruction work, coordinating with the corresponding SEPE employment office.
4. Plan the works and services of general interest that will be financed with the funds: the grant covers salaries and contributions, not materials or machinery.
5. Properly manage the justification of funds received, given that this is a public grant subject to the General Subsidies Law, with the justification and reimbursement obligations that this entails.

Official source

View complete regulation in official source

Notice: This article is for informational purposes only and does not constitute legal advice. For specific decisions, consult a qualified professional. Source: https://www.boe.es/diario_boe/txt.php?id=BOE-A-2026-16553