This is Caganer, the figure of a little boy taking a dump, who appears in traditional Catalan nativity scenes. He dates back at least to the 18th Century but no one knows what his presence is meant to convey. Suggestions have been that he’s there to amuse small children, to remind us that we never know when salvation will arrive, to show that, at bottom, all human being are equal.

In any case, I can’t think of any reason why he shouldn’t appear in a nativity scene.