Portugal will only have a 0.2% deficit in 2019, according to the Government's budget plan | Economy

Portugal will only have a 0.2% deficit in 2019, according to the Government's budget plan | Economy



Portugal will touch the deficit zero in 2019. In the budget of the last year of the legislature presented on the morning of Tuesday by the Minister of Finance, Mário Centeno, a deficit of 0.2 is foreseen and a debt of 118.5%, ten points less than that of this year.

Already with the approval of its parliamentary partners –PC Y Bloco de Esquerda- Centeno was exultant before the media, exhibiting macro data almost without blemish. "This is a budget that continues to be characterized by sustainable growth," he said. For the next year it foresees that the unemployment goes down to 6.3%. "The growth of employment is of better quality because 80% of new contracts are permanent," he clarified.

The deficit, which was 2% in 2016, of 0.9% in 2017, of 0.7% in this, will fall in the next 0.2%, "a credible goal". Centeno recalled that Portugal meets its budget forecasts for the third consecutive year, without any rectification. Faced with criticism from his partners left to sacrifice deficit to inject more public money, Centeno remembers that thanks to that international confidence (all the agencies of ratings have taken out the national bonds), Portugal is financed cheaper each year. "There is no healthier way to grow than what we present here."

Protests in public health

The budget satisfies its partners on the left with an increase of 800 million euros for the Civil Service. "The average salary of civil servants will grow 68 euros, the biggest increase in the sector in the last decade." It also increases the minimum wage to 600 euros, although it is not ruled out that in the parliamentary debate a greater increase will be agreed by mid-year – in October there will be legislative elections.

The euro is too strong to be disturbed by the budget of one of its member states [Italia]

The great social criticism of this Government has come from the side of the health services. Today the nurses start a new strike – they take more than 100 days this year – for "professional dignification". According to Centeno, 1,200 million euros are allocated to the reinforcement of public health. "We are going to launch a pilot project that alters the financing model of hospitals to reduce their indebtedness."

The country's growth stands at 2.2%, compared to 2.6% this year. "Almost ten points in these four years, he explained." This government has shown that there was an alternative to austerity. " Public investment is the one that barely has an increase, but Centeno takes hold that nowadays public investment is "invisible", because it is not only about doing public works but also about administering hospitals.

Increase in pensions and more taxes on tobacco

Small changes also come to the citizen's pocket, such as an increase of 10 euros in pensions, a reduction in VAT on part of the electricity bill, retirement without a penalty at 63 years and 40 for contributions. The VAT for cultural shows is reduced to 6%, with the exception of bullfighting, as well as that of wigs for people with cancer and those for food in restaurants. Rates on tobacco, soft drinks with sugar, polluting cars and plastic bags (12 cents) are rising.

The debt that, when they reached the Government in 2015 was above 130%, will fall to 118.5% in 2019, according to the Centeno accounts, which have always been square. Centeno has the power to stop any spending of the ministries, even if they have been approved in budgets, if he sees that the accounts are diverted. It is what it has done every year, hobbling the autonomy of the ministries but year after year, setting the budgets for example in Brussels, while getting the support – although critical – of the PC and Bloco, key to keep the Government in power socialist of António Costa.

When asked by journalists, Centeno had to wear the hat of the Eurogroup president to answer Italy's budget. "The euro is too strong to be disturbed by a budget by one of its member states."

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