Spain has set out the goal of creating more than 800,000 jobs over the next three years through the use of 72bn in eu funds, even as the countrys independent economic authorities warn of the risk of wasting or misallocating the once-in-a generation injection of resources.

Laying out his governments long-awaited plans for the eus 750bn coronavirus recovery fund, pedro snchez, prime minister, said his government wanted to use 72bn between 2021 and 2023, 37 per cent of which would go to green investment and 33 per cent to digital transformation.

Overall spain hopes to obtain 140bn in grants and loans from the recovery fund, which was approved by the eu in july.

We want this to add more than 2.5 percentage points a year to gross domestic product in the next three years, mr snchez said. and we want create more than 800,000 new jobs in that time.

He added that the funds, which he has previously likened to the marshall plan that helped revive europes economy after the second world war, would lead to a new modernisation of the spanish economy.

Spains economy is one of the worst hit in europe by the pandemic and mr snchezs government this week acknowledged that it expected 2020 gdp to shrink by 11.2 per cent. the bank of spain has warned that unemployment could come close to 20 per cent by 2022.

The central bank has also highlighted the risk that the recovery funds fail to produce their desired effect if projects are not well chosen and run. we would be making an enormous mistake if we thought that just receiving the funds will enable our country to get the most out of them, pablo hernndez de cos, the banks governor, told parliament this week. if we make bad use of the funds, and basically use them for current spending...the multiplier effect will be very reduced.

Spains independent fiscal watchdog also said this week that while modernising and digitalising the economy could have a big impact on growth...there is a high risk of delays in the absorption of these funds and the execution of these projects.

Mr snchez called for parliament to pass a budget as soon as possible, which he said would allow the government to bring forward 27bn from the eu funds to be available immediately. he is expected to present his budget plan in the coming days.

This is not just any budget, he said. this is the budget the country needs to recover from a heavy blow and to win its future.

Despite more than two years in power, the prime minister has yet to pass a budget of his own, relying instead on the tax and spending plans of his centre-right predecessors. officials in his government acknowledge that the issue is a near-existential fight, since approving a budget could help secure mr snchezs minority coalition in office for two or three more years.

Conversely, his rivals consider that his government is more likely to be shortlived if it cannot implement its tax and spending plans. the main opposition peoples party has called for the government to treat the eu funds separately from the budget, and set up a non-partisan agency to administer them.

Mr snchez said 60bn of the 72bn spain intended to spend over the next three years would come from grants and the remainder from loans. in total, he set out 10 sectors in which the government planned to invest. these included: agriculture and rural development, infrastructure, energy transition, public administration and justice, business digitalisation, the health system, education, employment policy and caregiving, culture and sport, and updating the tax system.