Lisbon - QNA
The Portuguese government on Monday unveiled deeper cuts and steep tax increases that are likely to further fuel public anger against austerity. Presenting the 2013 draft budget, Finance Minister Vitor Gaspar said there was “no room for maneuver,” referring to Portugal’s effort to lower its debt in line with demands by international creditors who granted it a bailout worth 78 billion euros (100 billion dollars). Critics say the government’s austerity measures are deepening a recession and driving up unemployment, which stands at more than 15 per cent. The deep spending cuts and tax hikes replace plans to raise workers’ social security contributions, which were abandoned after mass protests. The European Union and Internation Monetary Fund have recognized Portugal’s austerity efforts by relaxing its budget deficit targets. Prime Minister Pedro Passos Coelho is now struggling to achieve a deficit of 5 per cent of gross domestic product this year and 4.5 per cent in 2013 – up from the previously agreed 4.5 per cent and 3 per cent. In 2011, the deficit stood at 4.4 per cent, but that level was only reached thanks to an exceptional transfer of banks’ pension funds into state coffers. The main opposition Socialist Party, which had earlier backed the government’s austerity policies, said it would vote against the budget. But it was almost certain to be approved by parliament, where Passos Coelho’s centre-right Social Democrats and their conservative allies have an absolute majority. The trade union confederation CGTP has called a general strike for November 14 to protest against the cuts.