How AI Is Helping Government Companies in Spain Cut Costs and Improve Efficiency

Spain's public administrations are already testing how generative AI can cut red tape, speed service delivery and stretch tight budgets: an EsadeEcPol study estimates that among 1.44 million public workers, 67% could see between 10–50% of tasks enhanced and a ten‑year rollout could add roughly €7 billion in annual value; real pilots back this up - ISSA, Social Security's virtual assistant, answered two million citizen queries in its first month - so shorter waits and faster refunds are within reach.

Successful scaling in Spain will hinge on three pillars the research flags: clear governance, modern infrastructure (including ALIA and Spanish language models) and wide reskilling opportunities for frontline staff.

For public servants and managers looking to upskill quickly, practical programs like Nucamp's 15‑week AI Essentials for Work bootcamp offer focused training in prompt skills and workplace AI use cases that map directly to the administrative tasks AI is already speeding up in Spain (EsadeEcPol study on AI in the public sector, Nucamp AI Essentials for Work bootcamp (15-week workplace AI training)).

“The reason to use AI in the public sector is to automate red‑tape tasks, not to replace human input.”

AI matters for Spain's public sector because it targets the humdrum that slows services and swallows staff time: generative tools can summarize, translate and triage paperwork at scale, cutting waits for permits, benefits and refunds while freeing public servants for higher‑value work - Spain's EsadeEcPol team estimates a 9% average productivity boost per administrative worker after ten years, worth roughly €7 billion a year if adoption spreads (EsadeEcPol report: AI in Spain's public sector).

Real pilots already show the payoff - Social Security's ISSA handled two million citizen queries in its first month - and national efforts to build Spanish‑language foundation models and infrastructure aim to make those gains more accessible across regions and co‑official languages (IBM–Spain memorandum on Spanish‑language AI models).

The “so what?” is simple: even modest productivity lifts reduce backlog, improve citizen trust, and stretch tight public budgets - provided governance, training and secure infrastructure keep pace.

“The reason to use AI in the public sector is to automate red‑tape tasks, not to replace human input.”

Concrete pilots across Spain already prove what global market analyses predict: government companies are rolling out AI virtual assistants to triage citizen requests, automate FAQs and speed case handling - Social Security's ISSA handling two million queries in its first month is a striking example of scale that can turn long queues into same‑day answers.

Health surveillance pilots such as the IA4Covid early‑warning system show how anonymised mobility signals and automated alerts can free epidemiologists for strategic work (IA4Covid early-warning system).

Vendors and vendors' case studies point to concrete gains in contact centers and banking - areas Spain's public companies often interface with - using omnichannel assistants, voice biometrics and RAG to cut handling times and improve first‑contact resolution; see vendor capabilities and bank use cases described by Spitch (Spitch virtual assistant solutions).

Market research underlines why these pilots scale: the AI‑powered virtual assistant market is forecast to surge from about USD 10.4B in 2024 to USD 154.8B by 2034, making cloud‑first deployments and customer‑support automation practical investments for public sector operators (AI‑powered virtual assistant market report).

When government companies in Spain apply AI to the text-heavy, repetitive work that clogs desks and call centers, the result is tangible cost savings and faster service: EsadeEcPol finds 67% of public workers could have up to half their tasks enhanced and a 9% productivity uplift after a decade - roughly €7 billion a year if scaled nationwide (EsadeEcPol report: AI in Spain's public sector).

Real pilots prove the point - Social Security's ISSA answered two million citizen queries in its first month, acting as a 24/7 virtual clerk that dramatically cuts call queues - while ministries use AI to process criminal records, speed recognition of foreign degrees and anonymize legal documents.

Those wins become durable when matched with national policy on infrastructure, Spanish‑language models and reskilling outlined in Spain's AI strategy, which aims to embed AI across administrations rather than replace human judgment (Spain national AI strategy overview - AI Watch); the payoff is shorter waits, fewer backlogs and more time for frontline staff to do the complex, human work machines can't.

“The reason to use AI in the public sector is to automate red‑tape tasks, not to replace human input.”

Workforce adoption in Spain is a study in contrasts: BBVA Research flags that 40% of large firms already use AI while only about 8% of SMEs have incorporated any AI solutions, and broader surveys find roughly 9–20% of enterprises experimenting with or using AI today - a gap that leaves many public‑sector teams and smaller suppliers ill‑prepared for rapid change (BBVA Research report on AI's impact on Spain's economy, Spain 2024 Digital Decade country report).

Interest is high - a Cognizant study reports 73% of Spanish businesses want to accelerate generative AI initiatives - but momentum is held back by talent shortages, data‑privacy worries and limited investment: many roles will be complemented rather than replaced, so reskilling is urgent and practical (24% of tech job ads already ask for data skills and many vacancies go unfilled).

Employers favour targeted, role‑specific training and ask for public funding and partnerships to scale retraining; without that coordinated push, the country risks a lighthouse‑effect where a few advanced teams sprint ahead while most organisations struggle to board the train (Cognizant study on generative AI adoption in Spain, Tech Monitor summary of EY survey on public sector AI adoption).

“The initial focus has paid off for pioneers who have developed a more effective digital and data foundation, and in some cases, data platforms that embrace cloud technologies. They have made faster progress in embedding data capabilities organisation-wide, rather than just in specific teams and departments. This helps maintain high standards of data quality and consistency, breaks down organisational silos and provides a unified approach to data governance and regulatory compliance.” - Permenthri Pillay, EY Global Government & Public Sector Digital Modernisation Leader

Policy and funding are no afterthought in Spain's AI story: the National Artificial Intelligence Strategy (ENIA) sets a multidisciplinary agenda - covering research, digital skills, data platforms, ethics and public‑sector adoption - and the government backed it with a headline public investment of €600 million for 2021–2023 to turn plans into pilots and infrastructure (Spain National AI Strategy (ENIA) announcement - La Moncloa).

Coordination and governance are explicit priorities: the State Secretariat for Digitalisation and Artificial Intelligence (SEDIA) steers implementation, an Advisory Council monitors progress with a planned two‑year review cadence, and new bodies such as a national Data Office, a GovTech Lab and trustworthy‑AI certification schemes are designed to make adoption practical and accountable (see the detailed Spain AI Strategy report - AI Watch).

The strategy links funding lines (NEOTEC, ENISA, public‑private venture funds) with sandboxes, data repositories and Spanish‑language NLP priorities so government companies have both money and governance paths to experiment safely - an ethical and regulatory backbone that aims to turn one‑off pilots into repeatable, transparent services for citizens.

“seeks to place our country in the line of the leading countries in the research and use of a reliable Artificial Intelligence at the service of economic and social development, at the service of our development.”

Spain is rebuilding the plumbing that will let AI deliver real savings to government companies: the Barcelona Supercomputing Centre's MareNostrum 5 is being beefed up to roughly 450 petaflops - about 450,000 trillion operations per second - so public‑sector pilots can run larger Spanish‑language models and analysis at scale, and BSC will technically coordinate the ALIA language‑model plan that promises >20% training in Spanish and co‑official languages (up from under 5% today) to cut bias and improve service quality; the upgrade comes with a €90 million investment in specialised clusters and a commitment to dedicate 20% of MareNostrum 5 capacity to industry, while the wider AI Strategy pools roughly €1.5 billion (plus €600 million already mobilised) to build sustainable data centres, talent pipelines and GovTech sandboxes - small, strategic choices that turn abstract compute power into faster permit processing, bilingual virtual assistants and reusable public data platforms that actually shorten citizen wait times (see the MareNostrum 5 supercomputer upgrade at the Barcelona Supercomputing Center and the ALIA Spanish language-model plan).

“not only strengthens our technological infrastructure and innovation capabilities, but also ensures that the development of artificial intelligence in our country is carried out under the highest standards of sustainability and ethics. It is a step towards a more digitalised and competitive economy, where technology serves the well-being of all citizens.” - José Luis Escrivá, Minister for Digital Transformation and Public Administration

Public–private collaboration is becoming the engine that helps Spanish government companies and small firms turn pilot projects into everyday services: the Government's MoU with IBM frames a national effort to build foundation models “proficient in the Spanish language and co‑official languages” so public services and SMEs can use tools tuned for Catalan, Basque, Galician and Valencian, while IBM's open‑source approach aims to foster an ecosystem of AI creators and builders rather than lock solutions behind proprietary stacks (IBM–Spain memorandum to advance national AI strategy and Spanish-language AI models).

At the same time, industry partnerships such as the Telefónica Tech–IBM SHARK.X initiative bring practical plumbing - watsonx, Cloud Pak for Data, a use‑case office and training at Telefónica's La Cabina - to help SMEs adopt governed, cloud‑first AI with proofs of value before scaling (Telefónica Tech and IBM SHARK.X collaboration to drive AI, analytics, and data management for enterprises); the result is lower cost of entry, clearer governance paths and hands‑on reskilling so smaller suppliers can bid on public contracts instead of being left behind.

“AI positions us at the threshold of a new industrial revolution, with a very significant potential impact in terms of productivity gains for a large number of economic sectors and in providing better public services to our citizens,”

Government companies in Spain must weigh clear upside against concrete legal and ethical limits: Spain now has an active market‑surveillance agency (AESIA) and a draft national AI law that together embed the EU's risk‑based approach, so deployments that affect health, safety or fundamental rights can trigger heavy duties and sanctions - discrimination claims already carry fines (ranging into the hundreds of thousands of euros and, in very serious cases, even temporary closure of activity) and the burden of proof often shifts to the deployer.

Practical steps shrink that risk: classify systems by risk tier, run a fundamental‑rights impact assessment alongside a GDPR‑compliant DPIA, build auditable data governance and bias‑testing into procurement, and use Spain's RD Sandbox to pilot high‑risk or general‑purpose models under supervision.

Coordinate early with AESIA and sector regulators, document decisions to meet the Non‑Discrimination Act's strict evidentiary standards, and adopt transparency measures required for workers and citizens (algorithmic transparency guidelines and the Rider Law context are already relevant).

Spain's regulatory sandbox and advisory bodies are live now, so testing responsibly today means fewer surprises and safer scaling tomorrow (see the AI Watch tracker and legal guidance on discrimination for details).

For beginners in Spain eager to help government companies adopt AI, the practical route is clear: build workplace AI literacy, start with low‑risk, high‑value tasks (summarisation, triage, FAQ automation) and pair hands‑on training with a baseline of legal and data‑privacy awareness so pilots don't become compliance headaches; studies show strong interest but funding and talent are constraints, so focus on quick wins that prove value - EsadeEcPol estimates 67% of public workers could see 10–50% of tasks enhanced and a potential €7 billion annual value after scale (EsadeEcPol study on AI in the public sector) - while Cognizant's research highlights talent, product maturity and privacy as common inhibitors that coordinated training and partnerships can fix (Cognizant research on generative AI adoption in Spain).

Practical next moves: join a supervised pilot or sandbox, demand algorithmic transparency in procurements, and take a role‑focused course to learn prompts, RAG and business use cases - programs like Nucamp's 15‑week AI Essentials for Work bootcamp (registration) map directly to those skills and shorten the path from curiosity to measured impact for public services.

“The Government of Spain is promoting ALIA with the aim of strengthening the country's technological sovereignty and positioning it as a benchmark in AI in Europe. This project seeks to reduce dependence on international models, promote the use of Spanish and the co‑official languages in the technological field and democratise access to AI.” - Marc Bara, OBS Business School