Portugal’s parliament has rejected the minority Socialist government’s proposed state budget for 2022, a move expected to trigger an early election and put a brake on the country’s post-pandemic recovery plans.
After weeks of negotiations, the moderate Socialists were deserted by their hard-left allies from the Communist party and the Left Bloc. Those two parties have helped shore up the government’s power over the past six years by voting for its policies or abstaining.
The budget proposal was defeated by 117 votes to 108, with five abstentions.
“My conscience is clear,” the prime minister, António Costa, told legislators. “Because I did all I could to make this budget work without adding anything to it that would be to the country’s detriment.”
Referring to economic recovery efforts, él dijo: “The last thing Portugal needs, and the Portuguese deserve, is a political crisis at this moment.”
The Portuguese president, Marcelo Rebelo de Sousa, who has no executive powers but oversees the running of the country, had warned that he would call an early election if parliament did not approve next year’s government spending plan. He could make an official announcement next week, after consultations with political parties and others.
The government’s current four-year term is due to end in 2023.
Because of constitutional requirements that must be met before an election can be held, and taking into account the Christmas vacation period, the early election would probably take place in January.
That means a new 2022 spending programme probably wouldn’t go before parliament before April.
The timetable consigns Portugal to months of political limbo just when the government was poised to fire up the economy after the Covid-19 pandemic by deploying €45bn (£38bn) in aid from the European Union.
Encima de eso, the emergence of smaller parties that have won seats in parliament in recent years, including a surging rightwing populist party, have muddied the political outlook, according to Francisco Pereira Coutinho, a politics professor at Lisbon’s Universidade Nova.
“This crisis is less worrying than what might be coming afterward … with a more unstable and volatile political situation than we have now," él dijo.
A popular mass vaccination campaign has helped Portugal, for the moment, largely contain Covid-19. The way things stand, with fewer than 1,000 new cases a day since mid-September and daily deaths in single figures, the pandemic shouldn’t hold up an election in the country of 10.3 millón.
Recent opinion polls suggest the Socialist party would easily win an election but would again fall short of a parliamentary majority.
Costa, the prime minister for the past six years whose political profile in the EU rose considerably during Portugal’s presidency of the bloc last year, is widely considered a candidate for an international job. A poor election result could be his cue to depart national office.
Both the Communist party and Left Bloc lost votes in Portugal’s 2019 elección, with their decline in popularity blamed in part on their support for the more moderate Socialists.
The centre-right Social Democratic party, the main opposition, is caught up in a leadership battle and has largely failed to capitalise on the government’s predicament.