João Leão: No return to austerity, budget will still be demanding
"Portugal will not return to austerity. We are committed to fiscal stability and to returning to the path of income and employment recovery," the finance minister said.
Portugal’s finance minister, João Leão, told parliament on Wednesday that “Portugal will not return to austerity”, but warned that the next budget “will not be easier or less demanding than previous ones.”
“Portugal will not return to austerity. We are committed to fiscal stability and to returning to the path of income and employment recovery,” Leão began by telling MPs during a regular hearing.
Later, the minister said that the next budget (OE2022) “will not be easier or less demanding than previous ones”, despite the suspension of Brussels’ budget rules in 2022 allowing “an extraordinary stimulus” and “moving from emergency measures to support measures for the strong recovery of the economy.”
However, he warned that the country had to “maintain the focus on economic recovery and investment, with the support of the Recovery and Resilience Programme [RRP]”, to “address the main scars left by the crisis”, especially in the areas of “the economy, health and education.”
“This path is not incompatible with responsibility in the management of public finances, as we have proven in the past. The threat of deviating from this path of balance and responsibility will not come from a coherent, anti-cyclical budgetary strategy, focused on recovery and growth measures, without losing sight of medium-term sustainability,” he said.
“The threat to the stability of public finances may indeed result from a mistaken perception that we do not have to make choices and that we can successively take uncoordinated measures that are not part of a budgetary strategy,” the minister warned.
Earlier, Leão saluted the parties that enabled the OE2021, in this case, the PS, PCP, PAN and PEV, as well as the independent members Cristina Rodrigues and Joacine Katar Moreira.
“There were, in this assembly, those who had the sense of responsibility to pass the budget when the country and the Portuguese needed it most,” said João Leão.
The minister also said he valued the measures that “have the mark of the different parties” and the independent members, recalling that “we are still in the middle of the budget year”, in a reference to the PCP’s request for today’s hearing.
“We remain committed and committed to the full realisation of this budget by the last day of the year. In the middle of the year we have already achieved more than half of the measures provided for in the budget,” the minister said.
Leão listed the implementation of several measures approved in the State Budget for 202021 together with the other parties, such as the payment of lay-offs at 100%, the extraordinary payment of unemployment benefits for six months, the increase in pensions and the extraordinary support to workers’ income.
The minister also referred to the approval of the risk subsidy for professionals in the front line in the fight against the Covid-19 pandemic, the hiring of more than 2,000 professionals for the National Health Service, or the surpassing of 150 million euros in investment in health centres.
At the end of the minister’s opening speech, PSD member Afonso Oliveira said that Leão was “flirting with the left” due to the approaching budget negotiation period.
