Portugal court finds provisions of 2013 budget unconstitutional

[JURIST] Portugal's Constitutional Court [official website, in Portuguese] ruled [judgment, in Portuguese] that four out of nine contested austerity measures of the 2013 state budget were unconstitutional. The court's decision came in response to the request of Portugal's President Anibal Cavaco Silva [official website] for the court to determine whether retirees and public workers were being treated unfairly under the terms of the country's constitution. The finding [BBC report] will deprive the country of approximately 1.5 billion euros in savings necessary to meet the terms of the 78 billion euro bailout granted to Portugal by the International Monetary Fund (IMF) and the European Stability Mechanism (ESM) [official websites] in 2011, which requires Portugal to strictly control its spending. In order to meet the appropriate savings, the government must either find alternate savings and submit them as a supplementary budget to the parliament, or seek to renegotiate the terms of the bailout.

Portugal is one of many European states struggling to recover from financial crisis of 2008. In November, the European Court of Justice (ECJ) [official website] ruled [JURIST report] that the eurozone's permanent bailout fund, the ESM, is in line with European law. The ruling came following several member states' own courts finding the ESM constitutional under their own laws, including Estonia and Germany [JURIST reports]. In March of 2012, the Treaty on Stability, Coordination and Governance [text, PDF] was signed [JURIST report] by leaders from 25 of the 27 EU member states, with only the UK and the Czech Republic declining to sign the measure.

 

About Paper Chase

Paper Chase is JURIST's real-time legal news service, powered by a team of 30 law student reporters and editors led by law professor Bernard Hibbitts at the University of Pittsburgh School of Law. As an educational service, Paper Chase is dedicated to presenting important legal news and materials rapidly, objectively and intelligibly in an accessible format.

© Copyright JURIST Legal News and Research Services, Inc., 2013.