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Portugal workers stage strike for quicker end to austerity

LISBON, Portugal – Portugal’s new Socialist government is facing its first strike, with one of the biggest public sector trade unions saying Wednesday its members will walk off the job to force a quicker rollback of austerity measures.

The 24-hour strike Friday by the Common Front, an umbrella organization that represents about half the country’s more than 600,000 government workers, is likely to cause disruption at schools, hospitals, courts and other public services.

The centre-left minority government, backed by the Communist Party and radical Left Bloc, is restoring labour entitlements lost after Portugal’s 78 billion-euro ($85 billion) bailout in 2011, even though national debt remains high.

The government has already approved a return to the civil servants’ traditional 35-hour working week, down from the current 40 hours, but only from July. The Common Front says the change must be sooner.

The government is also restoring civil servants’ pay that was cut, as well as bringing back four public holidays, increasing the lowest pensions and cutting tax for low-income families.

The government says the measures will trigger a rise in consumption that will fuel growth.

However, international ratings agencies, Portuguese fiscal supervisors and analysts have expressed concern that the government’s economic expectations are too optimistic.

Also, the European Commission is keeping up the pressure on Lisbon to reduce its debt burden, asking the government to explain why its spending plan for this year doesn’t cut deeper into the budget deficit, as previously recommended by Brussels.

The Commission, the EU’s executive arm, wants to know why the difference between forecast revenue and expenditure is seen falling this year by 0.2 percentage points instead of 0.6 percentage points, according to a letter published by the Finance Ministry on Wednesday.

Prime Minister Antonio Costa said the letter was a “completely normal” request for clarification and that the government would reply by Friday.

“We have good arguments, from an economic standpoint, to explain our position,” Costa told reporters.