Following the defeat of Prime Minister Luís Montenegro’s government in a confidence motion on 11 March, Portugal is to hold another general election on 18 May, just a year after the last one.
Montenegro’s Democratic Alliance scored a narrow win in last year’s general election, but with 80 seats in the 230-seat Assembly was far short of a majority. The prime minister opted to govern as a minority, rather than form a coalition, leaving his administration vulnerable to a parliamentary defeat at any time.
Montenegro called for the recent confidence motion, following revelations about his family business activities and allegations of conflicts of interest.
The family business, Spinumviva, was established in 2021 to provide consultancy services to a variety of business clients, most of whom Montenegro had worked for before becoming leader of his party in the Assembly. The client list recently became public and, as well as Radio Popular and Ferpinta, it included the Solverde group, which runs casinos. Spinumviva was providing the company with advice on compliance regulations, in return for a fee of €4500 a month. However, Solverde’s casino licence is up for renewal, and the decision on that rests with the government. Opposition parties cried foul, while the prime minister maintained that nothing improper had occurred. He transferred shares in the business to his sons and relocated the company from his home to an office in Porto.
But his moves did not satisfy the other parties, who resolved to vote against the confidence motion. Montenegro, in turn, accused them of political opportunism, contributing to instability.
Following the loss of parliamentary support, President Marcelo de Sousa agreed to dissolve the one-year-old Assembly and call new elections for May.
The prime minister may not be too dismayed at this turn of events. His Democratic Alliance, made up of his own Social Democratic Party (PSD) together with the People’s Party (CDS) and the People’s Monarchist Party (PPM), currently has a slightly stronger poll rating of around 31%, compared to its 29% score in last year’s general election. His Alliance could therefore improve its parliamentary position, although it seems to have little hope of an outright win.
The government has a reasonable record for its one year in office. The Portuguese economy has grown at 2%, ahead of the EU average. Inflation has come down to 2.4% and unemployment has dipped slightly to 6.4%. The government has also produced a small annual budget surplus.
Most of the policy achievements over the year have emerged as a result of deals with the other main parties in the Assembly. These include some small reductions in general income tax rates and, in a bid to slow the exodus of young people from the country, the introduction of big income tax discounts for those under 35 years old, starting with a 100% discount in year one, tapering down to 25% for the last two years of the ten-year concession. State pensions have also been increased, and tolls have been removed from the A22 Algarve motorway.
The general election in May might not fundamentally change the political deadlock in the Assembly. If current polls are a reliable indication, Montenegro’s Alliance may advance slightly, while the main opposition party, the Socialists (PS), are set to hold steady, and the right wing populist Chega may dip slightly, following adverse publicity surrounding some of its parliamentarians. If the result does follow this indication, Montenegro would emerge as prime minister again. He would then face the choice of whether to press on as the head of another precarious minority government, or to forge a coalition with another large party, giving the prospect of some greater government stability. Even if the Socialists edge ahead, they too would face the same challenges in terms of forming a stable government.
After three general elections in as many years, the country may wish for a period of stability. As it is, it faces not only a general election in May, but local elections already scheduled for October, and then a presidential election next January. After that, the people may wish to give the ballot boxes a rest for a while.
James Plaskitt is a retired politician who was a member of the British parliament from 1997 until 2010. He now lives in the Algarve.
Photo: Luís Montenegro at the EPP Summit, 6 March 2025, Brussels © CC BY 2.0 European People’s Party flickr.com/photos/eppofficial
