UPDATED: Portugal budget likely doomed, but snap election may take time

LISBON, Oct 27 (Reuters) – Portugal’s parliament looks set to throw out the minority Socialist government’s 2022 budget bill on Wednesday, making snap elections the most likely next step, though how soon is still anyone’s guess.

While the rejection of a budget does not necessarily imply snap elections, President Marcelo Rebelo de Sousa warned on Monday that he would have no option but to dissolve parliament and hold elections two years ahead of schedule.

That, however, entails a process of consultations that could take several weeks, with no deadline to finalise them, nor for the president to sign the dissolution decree.

Rebelo de Sousa will have to consult parliament speaker Ferro Rodrigues, Prime Minister Antonio Costa, who has already ruled out his resignation, as well as representatives of all parties with parliament representation and his own consultative body, the Council of State.

Representatives of parliamentary benches of all parties said that Rodrigues consulted them on Tuesday at the president’s request. The two hard-left parties said they told him there were other alternatives to a dissolution, while Expresso newspaper said that they preferred a new budget proposal.

It means that if any party was to propose a no-confidence vote in the government, it has good chances of surviving for now.

Costa could in theory still present a new budget bill, although he has said he is ready to lead his party in the next election.

The Communists and Left Bloc have lost seats in successive past elections and opinion polls suggest they could lose more clout in an election.

If and when the president publishes the dissolution decree, elections must be held within 60 days.

He has indicated initially the ballot could occur in late January or early February, although some analysts do not rule out a later date to give time for the main opposition Social Democrats to hold an internal leadership vote in December and a congress in mid-January.

Rui Rio, the leader of the centre-right party, said on Wednesday that internal party politics should not condition the elections, which “have to take place as quickly as possible”, but preferably not before January.

Photo – Portugal Prime Minister Antonio Costa EPA-EFE/ARIS OIKONOMOU