Austerity vote could topple Portugal's govt

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Austerity vote could topple Portugal's govt

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Portugal’s main opposition party, the Social Democrats, have again refused to back the country’s latest austerity plan.

That makes it more likely the minority government of Prime Minister Jose Socrates will fall when parliament votes on the cut-backs this week.

The prime minister has said an opposition rejection would worsen Portugal’s crippling debt crisis meaning it would have to seek an EU bailout, like Greece and Ireland.

After meeting Socrates, PSD leader Pedro Passos Coelho said that although his party backed the country’s budget deficit goals as promised to Brussels, but not the newer government-proposed measures which he called rushed and inadequate.

“We reaffirmed that the measures presented by the government … do not deserve the support or approval of the PSD since they lay out a profoundly unfair path for the Portuguese,” Passos Coelho told reporters.

The party has withdrawn the backing for cost-cutting it had given to Socrates earlier in the euro debt crisis.

“There are no conditions of trust for any talks to be resumed between the PSD and the government,” Coelho said.

The government needs opposition support to pass legislation as it rules without a majority.

The extra spending cuts and tax changes the government proposes are aimed at ensuring the budget deficit is brought down to 4.6 percent of gross domestic product in 2011, as promised to Brussels, from around seven percent last year.