Finland Times

 

The Portuguese Parliament approved legislation to reintroduce new cuts in public sector wages on Tuesday, which will be applied to employees with salaries over 1,500 euros per month.

     

The austerity measure was approved by the majority parties in parliament, the Social Democrats and Portugal's rightist CDS-PP coalition, while all of the opposition lawmakers voted against it.

     

According to the new austerity measure, salaries of employees in public sector will be cut by from 3.5 percent to 10 percent for monthly earnings over 1,500 euros this year and in 2015.

     

This new austerity measure will be sent to the country's president in the next few days to be enacted, after the debt-laden country's constitutional court last month gave the Portuguese government more leeway to cut the budget deficit by approving public-sector salary cuts for 2014 and 2015 but rejected more cuts between 2016 and 2018.

     

The Portuguese government has been cutting spending and implementing tax hikes since it received a 78-billion-euro bailout from  its international lenders -- the European Commission, the International Monetary Fund and the European Central Bank -- in May 2011.

     

Portugal exited the bailout program in May, but as requested, Lisbon should cut its deficit to 4 percent of GDP this year and still has to cut its budget deficit to 2.5 percent of GDP in 2015.