Tensions are mounting between the ruling centre-right coalition and the Constitutional Court after the latter recently rejected three measures proposed by the government in the 2014 national budget. Opposition parties have called on President Cavaco Silva to dissolve parliament and call for an early general election because of the government’s recurrent breaches of the constitution and alleged attempts to influence the court’s decisions.
Over the last few years, the Constitutional Court has reviewed the legality of various austerity measures agreed with the “Troika” – European Commission, European Central Bank, and the International Monetary Fund – in return for the €78 billion loan package granted to Portugal in May 2011. Indeed, over the past three years the Court has struck down nine such measures. The Court’s latest rejection of three fiscal measures has forced the government to search for alternative measures to ensure the state’s deficit falls to 4 per cent of the GDP this year and 2.5 per cent next year, as required by the Troika. On 12 June Finance Minister Maria Luís Albuquerque announced that the government would forgo the final instalment of €2.6 billion due under the international bailout programme because the Court’s decision prevented the government from complying with the conditions set out in the programme. Portugal officially exited the international bailout programme on 17 May 2014.
The Court’s latest rejection of the austerity measures has intensified the already strained relationship between the government and the Constitutional Court. On 5 June, during the closing of a conference rather ironically titled “Democracy and new Representations”, Prime Minister Pedro Passos Coelho, the leader of the Social Democratic Party (PSD), fanned the flames by saying that the Court needed “better judges” who should be subject to “greater scrutiny”. The Prime Minister also called for the Court for issue a “political clarification” regarding its decision. So far, the court has refused to do so on the grounds that “it does not need to tell the government how to govern”.
The Constitutional Court comprises thirteen judges. Ten judges are appointed by parliament – five by the ruling coalition, and five by the main opposition party – the Socialist Party (PS). The other three judges are co-opted from other courts according to a selection made by those judges already elected.
The government’s negative attitude towards the Court has enraged Portugal’s main opposition party, the Socialist Party (PS), which has called for the President’s to intervene to maintain “their regular functioning.” Smaller opposition parties such as the Left Bloc (BE) and the Portuguese Communist party (PCP) have called for early elections.
Meanwhile, the PS has itself become embroiled in a fierce leadership battle. Following its poor performance in the May European Parliament (EP) elections, the mayor of Lisbon, António Costa, has (once again) announced his readiness to run for the PS leadership, thereby challenging the incumbent party leader António José Seguro. While the PS won the most votes (31.47%) in the EP elections, the results were worse than expected. After three years of austerity, the PS just received 123,435 more votes than the ruling coalition (PSD/CDS-PP), which came second with 27.71% of the votes. The PS is to hold a leadership election on 28 September.
Amidst institutional tensions, opposition parties have been urging President Cavaco Silva to intervene to resolve the “political crisis”. So far, the President, affiliated to the ruling PSD party, has remained silent. Ironically, snap elections might work in favour of the ruling coalition. According to the latest polls, electoral support for the PS has further declined since the EP elections.
The Constitutional Court declared unconstitutional two provisions of the 2012 budget law and four of nine austerity measures introduced in the 2013 national budget law. On 30 May 2014, the Court rejected another three measures proposed by the government in the 2014 national budget.
The three measures included cuts to public sector wages, pensions and health allowances.