Portuguese parliament approves austerity budget for 2012

Portugal's parliament on Wednesday approved the 2012 budget with tough austerity measures that vow to reduce the public deficit and save the country's economy."This is a very difficult budget," said Finance minister Vitor Gaspar, adding that "it is necessary to renew the confidence of the Portuguese people, of the markets and of our international partners."The new budget suspended the thirteenth and fourteenth monthly wages for all pensioners and public servants that receive over 1,100 euros (1,474 U.S. dollars) a month.The budget package also included elimination of all tax deductions for people that receive more than 60,000 euros (80,400 dollars) annually, the increase of the working hours by half hour a day and tax hike.The two ruling parties, the center-right wing PSD and the right wing CDS voted for the budget, while the only votes against the bill were from three minority small left-wing parties, namely the Communists, the Green Party and the Bloco de Esquerda. The main opposition party abstained in this vote.Portugal was the third eurozone member state needing a bailout in May, following the suit of Greece and Ireland. It then received 78 billion euros (104.52 billion dollars) loan in exchange to reduce its public deficit from 9.8 percent of gross domestic product in 2010 to 4.5 percent by the end of 2012.