More austerity measures
Prime Minister Pedro Passos Coelho announced on Friday night more austerity measures for the country.
The Prime Minister said that employees’ welfare contributions would rise from 11% to 18% whilst company contributions would drop from around 24%. Public sector workers will have their salaries cut for one month and not two as previously planned following a Constitutional Court hearing which declared the earlier decision as illegal.
The prime minister also announced that pensioners and retirees would not get their two bonus months back, despite the Constitutional Court ruling and that one bonus month’s wage would be with-held in 2013 and be paid monthly rather than as a lump sum once a year.
As the prime minister was making his announcement, the National Institute of Statistics announced that Gross Domestic Product (GDP) contracted by an annualised 3.3% in the second quarter of 2012.