Socialist Cost-of-Living Resolution Voted Down — Carneiro Accuses Right-Wing Bloc of Allowing State to Profit From Price Rises

Right-Wing Majority Votes Down Cost-of-Living Measures

Portugal's parliament voted down a Socialist Party (PS) resolution on Friday that called on the government to take immediate action to protect families and businesses from the rising cost of living. The resolution was defeated by the combined votes of PSD, Chega, Iniciativa Liberal, and CDS-PP.

The defeat prompted a sharp reaction from PS secretary-general José Luís Carneiro, who accused the right-wing parties of enabling what he called an "immorality" — allowing the state to collect increasing tax revenue from price rises while ordinary citizens bear the burden.

What the PS Proposed

The resolution — a non-binding recommendation to the government — called for a package of measures to address the impact of rising food prices, fuel costs, and production expenses on Portuguese households and businesses. Specific proposals included:

• Measures to mitigate the impact of rising energy and fuel costs on goods transport and public transport
• Support for the agri-food sector, where production costs have risen sharply
• Tax adjustments to prevent the state from profiting disproportionately from inflation-driven price increases

Carneiro said he was the first party leader to raise these issues with Prime Minister Luís Montenegro during parliamentary debates, initially when the Middle East conflict began driving up global energy and commodity prices.

'The State Is Collecting Revenue at the Expense of Citizens' Sacrifices'

Speaking after the vote, Carneiro made clear the PS intends to make this a sustained political issue. "The right — AD, Liberals, and Chega — contributed to the immorality of the state increasing its revenue at the expense of Portuguese citizens' sacrifices," he said.

"I want it to be clear to everyone: the state is collecting revenue at the expense of Portuguese citizens' sacrifices. From the PS's perspective, this is immoral, and we presented political proposals to correct this immorality — proposals that were voted down by the right in this parliament."

The PS leader warned that his party would continue to take its cost-of-living proposals "to each locality" across the country, framing the vote as a clear dividing line between parties that stand with citizens and those that do not.

The Political Context

The vote comes at a moment of genuine pressure on Portuguese household budgets. While inflation has moderated from its 2023 peak, food prices remain elevated, energy costs have not fully normalised, and housing expenses continue to consume a growing share of family income — particularly in Lisbon and Porto.

For the minority PSD-led government, the calculus is straightforward: higher tax revenue from rising nominal prices has helped maintain Portugal's fiscal surplus, which the government points to as a sign of responsible management. Accepting the PS resolution would have meant acknowledging that the surplus comes partly at citizens' expense — a politically uncomfortable admission.

For the PS, still in opposition after losing power in 2024, the cost-of-living agenda represents an opportunity to reclaim territory on economic issues ahead of any future electoral cycle. Carneiro's language — repeatedly using the word "immorality" — signals an intent to frame the government's fiscal stance as a moral failure rather than a policy disagreement.

The vote also illustrates the continued alignment between the government's AD alliance (PSD + CDS-PP) and the two opposition parties on its right flank — Chega and Iniciativa Liberal — on fiscal matters, even as they diverge on social and immigration policy. When it comes to protecting the current revenue windfall, the right votes as a bloc.