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Portugal's Left Bloc reaffirms backing for government despite vote

Reuters

LISBON (Reuters) - The leader of Portugal's Left Bloc, the main ally of the minority Socialist government in parliament, played down recent differences with the administration in an interview published on Tuesday, saying the alliance is to last the entire legislature.

Parliament is set to deliver the first defeat to the government on Wednesday when it is due to vote on a measure cutting the social security tax companies pay on the minimum wage. The vote could expose cracks in the government's alliance with the far left, who have vowed to vote against.

But Left Bloc leader Catarina Martins told the Publico daily that "none of the divergences are new and there have already been more delicate moments" in the relationship with the Socialists that have been resolved.

She rejected the view that parliament's leftist majority was paralyzed and said her party sought to fulfill the pact signed between the Socialists and the two far-left parties when the new government took over in late 2015.

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"No. I think it (majority) can even do a lot more ... We've advanced very quickly on some matters of our pact, while on others we are progressing more slowly."

"We have to fulfill the pact that we have," she said, replying "yes" to the question whether the agreement was to last the whole four years of the current legislature. Key issues such as a more progressive income tax and the unfreezing of wages and promotions in civil service are yet to be discussed in 2018.

The agreement between the Socialists, Left Bloc and Communist Party calls for reversing austerity policies of the previous center-right administration applied under Portugal's 2011-2014 bailout, while sticking to Lisbon's European commitments, especially on budget discipline.

In the first part of the interview published on Monday, Martins backed a debt renegotiation for Portugal and also said any European country should be prepared to leave the euro currency zone.

But the pact with the moderate center-left Socialists, whose validity she ultimately confirmed, encompasses no debt renegotiation and states Portugal's commitment to the euro.

Asked about the possibility of an early election, she said her party "will never arrange pretexts" for it and did not believe Socialist Prime Minister Antonio Costa would seek it either. "I think it would be a huge mistake (provoking early elections). I don't believe he's preparing for it," she said.

The Socialists lead in opinion polls that show them just shy of winning an absolute majority.

(Reporting by Andrei Khalip; editing by Mark Heinrich)