On 27 October, the Assembly of the Republic, the single house of the Portuguese Parliament, rejected the draft finance law for 2022 after 117 votes against it (108 for and 5 abstentions).

Prime Minister Antonio Costa's Socialist Party (PS) MPs voted in favour of the text while the Unitary Democratic Coalition (CDU), the Left Bloc (BE) and LIVRE (L), allies of the Socialist Party in parliament, joined the four right-wing parties in the chamber (Social Democratic Party (PSD), Social Democratic Centre/People's Party (CDS/PP), Chega (CH) and the Liberal Initiative (IL)) in their opposition. The People-Animals-Nature party (PAN) and the two non-attached members, Joacine Katar Moreira and Cristina Rodrigues, abstained.

In 2021, the budget was narrowly approved thanks to the abstention of MPs from the Unitary Democratic Coalition and People-Animals-Nature.

On 5 November, the President of the Republic, Marcelo Rebelo de Sousa, announced his decision to dissolve the Assembly of the Republic, which meant that legislative elections would be called within sixty days. The election will take place on 30 January 2022. The election was originally scheduled for autumn 2023 (by 8 October at the latest). "I have always hoped that it would not come to this and I have done my best to avoid it, but I have also made it very clear what the consequence of a rejection of the budget by parliament would be. If the Assembly of the Republic is not able to adopt a budget that is fundamental for the country, it is good to give the floor back to the Portuguese people to elect a new assembly," said the head of state on 27 October, since he has the constitutional power to dissolve parliament in times of crisis.

The use of European funds allocated to Portugal in the context of the health crisis is central to the 2022 finance bill. This substantial sum should help boost the country's economy but also improve the purchasing power of the Portuguese people.

The latter are thus invited to vote for the third time in a year after the presidential elections of 24 January 2021, in which Marcelo Rebelo de Sousa was re-elected, and the municipal elections of 26 September last.

The official campaign for the legislative elections will begin on 16 January and end on 28 January. Thirty-six televised debates will take place during the first fortnight of this month. Around 60% of Portuguese people believe that these early elections are "a bad thing", while the same percentage consider them "necessary".

However, the vote may not provide any clarity. "The President of the Republic anticipates a lasting crisis fed by the impossibility of obtaining an absolute post-electoral majority and by a radicalisation of positions that will make it difficult to form a coalition, especially on the left" said Celso Filipe, director of the business daily Journal de negocios.

The legislative elections of 6 October 2019 strengthened the Socialist Party at the expense of its radical left-wing allies, the Left Bloc and the Unitary Democratic Coalition. Antonio Costa, whose party came first with 36.34% of the vote, formed a minority government after the elections.

With three weeks to go before the vote, the Socialists are still ahead in the polls, although their lead is narrowing. According to the latest opinion poll conducted by Lisbon University and published in the weekly Expresso, they are due to win 38% of the vote, ahead of the Social Democratic Party, with 31%.

The right-wing populist party Chega is expected to take third place with 7% of the vote. The Unitary Democratic Coalition, allied with the environmentalists, is projected to get 6% and the Left Bloc also 6%.

Given these figures, it is not certain that the legislative elections on 30 January will allow Portugal to break the deadlock. Indeed, neither of the two main parties seem to be able to form a coalition that will ensure a stable majority.

The Socialist Party still dominant

Early parliamentary elections are not good news for any of the Portuguese parties, but the socialists seem to be more ready for them than their right-wing opponents. "The last thing Portugal needs is a political crisis," said Prime Minister Antonio Costa, adding "We don't want elections, but we don't fear them."

The dissolution ended one of the few left-wing coalitions in Europe. During the election campaign for the 6 October 2019 legislative elections, the outgoing prime minister had said he would not govern in coalition with the radical left-wing parties, the Left Bloc and the Unitary Democratic Coalition.

The geringonça, a term for a makeshift arrangement, which described the alliance that the Socialist Party had with the Unitary Democratic Coalition and the Left Bloc, and thanks to which it was able to govern for four years, was not renewed. "It is truly astonishing that this heterogeneous alliance could have been formed and that it could have lasted. The Left Bloc is indeed much more radical than the Socialist Party, and the communists, only active at municipal level, have always had an aversion to any involvement in national matters," said political scientist Antonio Costa Pinto.

For this election, Antonio Costa is asking the Portuguese people to give the Socialist Party the strength to govern in a stable and sustainable way.

The radical left's wager

The two radical left-wing parties, supporters of Antonio Costa's socialist government in parliament, called for the introduction of more pro-worker measures in the 2022 budget bill, the strengthening of the social protection system and more investment in health care, including more ambition in raising the salaries of health workers. The United Democratic Coalition and the Left Bloc criticised the outgoing Prime Minister for placing too much emphasis on reducing deficits and accused him of not doing enough for public services, rent control and the purchasing power of the Portuguese.

Communist leader Jeronimo de Sousa criticised the "bad faith" of Antonio Costa's government in the budget negotiations and said he did not think the dissolution of parliament was the right solution to the political crisis in Portugal. For its part, the Left Bloc denounced the "the government and the President of the Republic's blackmail. "

The radical left-wing parties are trying to distance themselves from the outgoing government at all costs. In the municipal elections of 26 September, they suffered a setback: it was a fiasco for the Left Bloc and a setback for the Unitary Democratic Coalition, which lost its strongholds in Lourdes and Evora. Each of the two parties saw that its support for the government was leading to a loss of voters and each said that it would probably be better off on its own. Both hope to recover in the early elections on 30 January.

"This ideological decision (the rejection of the budget) will have an electoral cost for both the Left Bloc and the Unitary Democratic Coalition, which will be penalised for not having supported a budget that was modest but not one of austerity," said Marina Costa Lobo, a political scientist at Lisbon University.

Forces on the right divided

The announcement of the parliamentary elections came at a time when the main right-wing opposition party, the Social Democratic Party, has been undergoing reconstruction as it faces internal divisions. The PSD had to bring forward the date of the election of its leader, initially scheduled for 4 December 2021. The election finally took place on 27 November and saw the victory of the outgoing leader, Rui Rio, who, with 52.43% of the vote, beat his rival Paulo Rangel, MEP, who took 47.57% of the vote. 50,000 PSD members took part in the election.

The PSD's programme for the 30 January vote includes a reduction in the tax burden: a reduction in corporate income tax to 19% in 2023 and 17% in 2024 (currently 21%) and a €400 million reduction in income tax in 2025 and 2026, particularly for employees earning more than €60,000 per year.) The PSD is also proposing tighter governance, higher wages and job creation, lower national debt as well as the creation of more wealth. Spending on health and education reforms should help Portugal reduce its budget deficit to 0.5% of GDP by 2026, according to the opposition party.

The Social Democrat Party is standing alone in the elections. Rui Rio said: "There are only two political parties in Portugal: the Socialist Party and the Social Democratic Party". The PSD dreams that the forthcoming elections will be like the municipal elections of 26 September in Lisbon, where the former European Commissioner, Carlos Moedas (PSD), created a surprise by beating the incumbent mayor Fernando Medina (PS) (31%) with 34% of the vote. Rui Rio said he was available to talk with the Socialist Party if necessary, but ruled out any agreement with André Ventura's Chega party.

For his part, the president of the Social Democratic Centre/People's Party (CDS/PP), Francisco Rodrigues dos Santos, sees in the PSD's refusal of an electoral coalition with his party "a turn to the left" by Rui Rio's party. "The chair of the PSD prefers to be friendly to those who will provide a majority to the Socialist Party rather than seeking to build an alternative policy with the Social Democratic Centre/People's Party", he said, adding "A vote in favour of the Social Democratic Centre/People's Party is a vote against the current system and it is also one that will allow the next government of Portugal to be clearly positioned on the right and not the result of arrangements made with the left".

A populist right on the alert

Chega seems to be the party most likely to benefit from the legislative elections. It could prosper on the divisions of the right and become the third force in Portugal. André Ventura hopes to confirm his breakthrough in the January 2021 presidential elections in which he won 11.93% of the vote taking third place. Nevertheless, Chega is still too radical to hope to enter government.

Recently, André Ventura declared that he was breaking the agreement that links Chega to the PSD in the Azores archipelago after Rui Rio criticised his governance. "A leader who says that he cannot ally himself with Chega at national level cannot wish to obtain this support at regional or municipal level," he stressed. What the Chega leader did not foresee, however, was that José Pacheco, Chega's leader in the Azores, would choose to continue to support the PSD despite what the party's national leader had decided.

The Portuguese political system

The Portuguese Parliament is unicameral. The Assembly of the Republic comprises 230 members, elected for four years by proportional representation in 22 multi-member constituencies. There are eighteen metropolitan constituencies and two autonomous regions - Madeira and the Azores - which each form a constituency. In addition, the Portuguese living abroad are divided into two constituencies: the first one includes those living in Europe and the second one those living in the rest of the world.

The lists of candidates for the legislative elections are blocked, so voters cannot express any preference within the list they vote for. At the end of the election, the seats are distributed according to the d'Hondt method.

Nine political parties won seats in the Assembly of the Republic in the legislative elections of 6 October 2019:

- the Socialist Party (PS), founded in 1973 and led by outgoing Prime Minister Antonio Costa, has 108 deputies;

- the Social Democratic Party (PSD), a right-wing party founded in 1974 and led since 2018 by Rui Rio, has 79 seats;

- the Left Bloc (BE), a radical left-wing party founded in 1999 and headed by Catarina Martins, has 19 seats;

- the Unitary Democratic Coalition (CDU), an alliance of the Communist Party (PCP), founded in 1921, the Green Party (PEV), founded in 1982, and the Democratic Intervention (ID). Led by Jeronimo de Sousa, it has 12 seats;

- the Social Democratic Centre/People's Party (CDS/PP), a Christian Democratic party founded in 1974 and led by Francisco Rodrigues dos Santos, has 5 seats;

- People-Animals-Nature (PAN), an animal rights and nature party founded in 2009 and led by Ines Sousa Real, has 4 seats.

- Chega (Enough) (CH), a right-wing populist party founded in 2019 by André Ventura, has 1 seat;

- Liberal Initiative (IL), party founded in 2017 and led by Joao Cotrim de Figueiredo, has 1 seat;

- LIVRE (Free) (L), a left-wing environmentalist party, has 1 elected member.

The Portuguese also elect their President of the Republic every five years by direct universal suffrage. The current head of state, Marcelo Rebelo de Sousa, former leader of the Social Democratic Party (PSD) (1996-1999), was re-elected for a second term with 60.66% of the vote on 24 January 2021 in the first round of voting. He was well ahead of Ana Gomes (PS), who ran without the endorsement of her party (12.96% of the vote), and André Ventura (CH) (11.93%). Four out of ten Portuguese people (39.26%) turned out to vote.

Reminder of the results of the 6 October 2019 legislative elections in Portugal

Turn out: 51.43%

Source : https://www.cne.pt/sites/default/files/dl/2019ar_mapa_oficial_resultados.pdf