In a statement that has been smartly shot down by opposition parties, finance minister Joaquim Miranda Sarmento has hailed the country’s budget surplus as “very important”, saying it gives the state margin to act in the response to the crises of the storms (earlier this year) and the Iran war.
As the damage from the former has been estimated as costing three times that of the €2 billion surplus, and the outcome of the latter is a complete unknown – and lurching further and further out of apparent control – it is not surprising that opposition parties have reacted badly.
From left to ‘centre right’, they have all said that what the government considers “historic” is actually neither here nor there: the surplus does nothing for the rapidly rising cost of living. “It doesn’t warm (people up) or cool (them down),” point out PCP communists – putting a new spin on the observation that ‘you cannot eat the economy’. And the fact that the government is so ‘pleased with itself’ has been seen very much as a form of rather arch ‘propaganda’ (which PS Socialists stress is not needed at this time).
From the finance minister’s perspective, however, the situation puts Portugal ‘up front’ when it comes to ‘international image’. We are a country that has balanced, careful accounts, and budgetary surpluses – a good bet, in other words. And it has all been possible, with a reduction in taxes, increases to civil servants’ wages and ‘reinforcement’ of pensions and other social payments, he stresses.
“This is not the end goal – it is a step on the path to fiscal responsibility,” Miranda Sarmento told journalists today.
Looking ahead to the rest of this year, the minister admits there could be a ‘small deficit’, but that it will not jeopardise the path towards balanced public accounts – with a return to surpluses expected in 2027 and 2028.
Regarding response to the crisis exacerbated by rising prices of goods, including fuel, Miranda Sarmento said the government will assess measures to be taken, ‘week by week’.
“The best way to protect families is to ensure economic stability and reduce future debt burdens,” he said, assuring that the government will continue to support families and businesses, carrying out this weekly assessment, but considering it premature, for now, to speak of any new measures.
Meantime, PSD parliamentary leader Hugo Soares also labelled the surplus news “absolutely historic” and lamented the lack of congratulations from opposition benches.
