By Andrei Khalip and Sergio Goncalves
LISBON (Reuters) – Portuguese President Marcelo Rebelo de Sousa kicked off talks with the main political parties on Wednesday to decide whether, or how soon, to call a snap election following the abrupt resignation of the Socialist prime minister.
Antonio Costa stepped down on Tuesday after prosecutors detained his chief of staff in an investigation into alleged illegalities in his government’s handling of lucrative lithium and hydrogen projects and said Costa was the target of a related probe. Costa has denied wrongdoing.
It is up to the conservative president to decide whether to allow the Socialist Party (PS), which has a parliamentary majority, to form a new or interim government, or to disband parliament and call an election.
His decision is expected on Thursday.
He had warned Costa previously that his exit for any reason would trigger a snap election, and analysts see that as the most likely option, although he could choose to give more time to the PS to get next year’s budget over the line in parliament.
“From an economic and social point of view, it’s important to know whether some measures of the budget will have the capacity to be implemented… Timing is everything,” said political scientist Antonio Costa Pinto.
The measures include lower income tax rates for the middle class and increased social benefits.
“Whatever the president decides, it’s important that he takes into account this concern with the conclusion of the budget,” said Ines de Sousa Real, head of the People-Animals-Nature (PAN) party with one house seat, after meeting the president.
Most political leaders have said they want a snap election but analysts note it may be in their interest to have it later rather than sooner as, with Costa gone, there are practically no household names among them.
“If Rebelo de Sousa pushes for a quick dissolution, the elections would occur in January, but the president might choose to delay them in order to give parties more time to prepare,” said Antonio Barroso, of Teneo political consultants.
By law, an election needs to be held within 60 days of the publishing of the presidential decree dissolving parliament.
The main opposition Social Democratic Party (PSD) is seen as the obvious beneficiary of an early election, but there are doubts whether it could win a full majority or even build enough support to form a stable government.
The PSD is still reeling from defeat in a January 2022 election that caused a leadership change.
Its new leader, 50-year-old Luis Montenegro, who had been largely out of the spotlight since resigning as a lawmaker in 2018, has so far struggled to gain momentum in opinion polls.
His most heavyweight likely rival would be Pedro Nuno Santos of the PS, who analysts say Costa had been grooming as his successor, if the party picks him to run.
He successfully coordinated support for a previous minority government with the far left in 2015-2019, but his resignation as infrastructure minister in December 2022 in a scandal around a severance payout by state-owned airline TAP has undermined his popularity.
Andre Ventura, the populist leader of the far-right, anti-establishment Chega – the third-largest force in parliament – could become a kingmaker for the centre-right PSD if it fails to clinch a majority, but Montenegro has so far ruled out any such alliance.
Whatever happens, Rebelo de Sousa seemed unfazed by the tough decision facing him, emerging from the presidential palace on Tuesday night to stroll among wellwishers and snap selfies.
The 74-year-old former law lecturer and political commentator has used his constitutional power to disband parliament once before, in November 2021. Unlike now, Costa’s government then had no parliamentary majority and had just had its budget rejected.
(Additional reporting by Patricia Rua, editing by Aislinn Laing and Nick Macfie)