Portugal’s main opposition party has announced that it intends to allow the 2025 budget proposal to pass in parliament, a crucial move for the survival of the country’s minority government.

“It’s been only seven months since the last election. A possible rejection of the budget could lead the country to the third elections in less than three years, with no prospect for a result with a stable majority,” said Socialist leader Pedro Nuno Santos on Thursday.

The opposition leader stated that the decision to allow the budget to pass covers both the initial vote on 31st October and the final vote in November.

The budget is a significant challenge for Prime Minister Luis Montenegro's minority government, which came into power in April following his centre-right AD coalition's narrow victory over the Socialists. 

To pass budgets and other legislation, the prime minister needs support from other parties and has had to make compromises on critical policies, including tax cuts, Bloomberg reports.

Montenegro also reiterated the need for political stability in Portugal on Thursday, pointing out that some of the country’s trading partners, like Germany, are experiencing “economic difficulties.”

Last week, he announced that negotiations with the Socialists over the budget had concluded and expressed full confidence that the proposal would pass in parliament. 

The Socialist Party, which holds just two fewer seats than the AD, will enable the budget to pass by abstaining from the vote.

Whereas Chega, a far-right party and the third largest in parliament, has already announced that it will vote against the budget. 

Montenegro previously stated that relying on the 2024 budget to govern next year “is not a solution.” 

Both he and the Socialist leader have expressed opposition to early elections.

Portugal has already held two snap elections in the past three years, one in January 2022 and another in March of this year.