Brussels, 18/04/2013 (Agence Europe) - On Thursday, Portugal revealed how it is intending to make up for a shortfall in austerity measures ruled illegal by the country's constitutional court on 5 April, giving details of spending cuts of around €800 million, 0.5% of GDP, according to Secretary of State for the Budget Luis Morais Sarmento, who said the cuts would be supplemented by other measures to find another €100 million to €400 million. The measures were prepared in consultation with the troika of lenders (European Commission, ECB and IMF), representatives of which carried out an assessment in Lisbon from 15 to 18 April. If the troika fact-finders give their approval, this will bring to an end the most recent assessment and lead to the disbursement of a new batch of aid, €2 billion (of the total €78 billion package endorsed in May 2011). Final agreement from the Eurogroup on extending the repayment guarantees on loans already granted to Portugal, also hangs on the troika assessment.
The new spending cuts announced on Thursday are expected to focus on the civil service. Sarmento said the cabinet had decided to set a cap on funding for each ministry and the spending cuts would affect spending on staff, goods, services and general operations. Details will be published in an amending budget to be unveiled in May to the parliament, explained Deputy Prime Minister Miguel Poiares Maduro in a radio programme.
In Brussels, Olivier Bailly, a spokesperson for the European Commission, said that the troika had not yet endorsed the measures, but would be examining them in detail over the next few days. The Commission said it was important for politicians in Portugal to remain united behind the measures. On Wednesday 15 April, the head of the Portuguese Socialist party, Antonio José Seguro, rejected the calls from the troika and the Centre-Right government that he support the austerity policy. Seguro said the Socialist party wanted to honour the country's international pledges but disagreed with the government on how to do it. Earlier in the month, the Socialist party tabled a motion of no-confidence in the government, but failed to get majority backing for it. (SP/transl.fl)