Early General Election in Portugal?… Parliament Rejects Government Budget Proposal

Antonio Costa, Prime Minister of Portugal
Photo by Xinhua News Agency

[Asia Economy Reporter Park Byung-hee] The possibility of an early general election has increased as the Portuguese parliament rejected the government budget proposal.

Portuguese President Marcelo Rebelo de Sousa previously stated that he would dissolve the parliament if the government budget proposal was rejected. In Portugal, the Prime Minister, who is the leader of the majority party in parliament, is responsible for running the government as the head of the administration, while the President, who is directly elected by the people as the head of state, holds powers such as dissolving the parliament, commanding the military, and vetoing legislation.

Bloomberg reported on the 27th (local time) that the Portuguese parliament voted down the government’s budget proposal for next year. The budget proposal was rejected with 108 votes in favor, 117 against, and 5 abstentions.

The Portuguese parliament is divided with a minority government. The ruling Socialist Party (PS), the largest party in the assembly, leads the cabinet with 108 seats out of 230, falling short of a majority. Until now, the Left Bloc (19 seats) and the Communist Party (10 seats) had supported the government either by voting in favor or abstaining, helping the minority government to manage state affairs.

However, in this budget vote, both the Left Bloc and the Communist Party opposed the government, resulting in the rejection of the budget proposal. This is the first time the government budget has been rejected since the Carnation Revolution in 1974.

Portuguese Prime Minister Ant?nio Costa won the general election held in October 2019 and succeeded in returning to power. About half of his four-year term remains. The general election is expected to be held as early as January next year.

However, even if an early general election is held, recent opinion polls indicate a high possibility of the Socialist Party returning to power. According to a poll by a local media outlet on the 27th of last month, the Socialist Party led with 37% support, 12 percentage points ahead of the center-right main opposition party, the Social Democratic Party (PSD, 79 seats). President Sousa, who announced the dissolution of parliament, is currently suspended from party membership but originally belongs to the PSD.

Prime Minister Costa stated on the 26th, a day before the parliamentary vote, that he would not resign. Earlier, on the 22nd, he said, "Even if the budget is rejected in parliament and President Sousa dissolves the parliament, I will respect that decision" and "I will prepare for all situations."

The Left Bloc and the Communist Party are reportedly more inclined to have the government propose a new budget rather than hold an early general election.

The Portuguese government projected the fiscal deficit ratio for this year at 4.3% in the budget and aims to reduce it to 3.2% next year.