Crisis: Portugal; IMF advises on spending cuts

Calls for reduction in state employees

09 January, 17:31

(ANSAmed) - LISBON, JANUARY 9 - The Portuguese government will have to reduce the number of state employees by 20% and their salaries by 7% in order to deal with the crisis underway.

These figures are contained in a ''consultancy'' report by the International Monetary Fund (IMF) published in the Portuguese newspaper Publico today. Drafted in December and sent to the government (which has not denied the news), the report contains a number of measures to be implemented but is classified as ''consultancy''. It focuses on public spending on state employees and retirees, the areas in which the government is held to be better able to act on as well as with greater potential for savings. CGTP union leader Armeno Carlos said that ''the measures suggested are against the Constitution'' and that they inflict harsh conditions for access to fundamental state services such as healthcare, education and social security.

The document indicates a number of ways to cut spending by 4 billion euros beginning in 2014. The largest share of the reduction will be the 10-20% cut in the number of state employees, which is expected to result in savings of around 2.7 billion euros. The reduction of state employee salaries by between 3 and 7% is expected to lead to further savings of at least 720 million euros, while another 300 million could be ''recovered'' by cutting the number of civil service employees by 30%. (ANSAmed).

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