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Spanish Parliament to vote on cuts

Tuesday 12 July 2011 - by Jacqui Street

The Spanish parliament in Madrid is expected to vote on spending cuts proposed by the minority Socialist government on Tuesday.

Prime Minister José Luis Rodríguez Zapatero wants to reduce government expenditure by 3.8 per cent for 2012, cutting the budget to €174bn ($165bn).

The minority government reportedly held negotiations yesterday to secure backing for the vote, but failed to reach agreement.

Zapatero's term expires in March 2012 but he is apparently facing calls for early elections.

Partido Popular MP Alvaro Nadal has told an Open Europe forum in London his party is confident of forming a majority government if an election is held in the next few months.


Nadal said the level of Spanish debt spread is now 300 points over the bund - German government federal bonds.

He said: "This has never happened before we are in the middle of a peak, investors are very nervous. We need deep reforms."

If the vote fails in the Spanish senate, it could return to the congress and be passed by a simple majority.


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