Lisbon, July 24, 2026 (Lusa) - The sole MP of Portugal's Left Bloc Party (BE) on Friday questioned the government regarding assurances that there will be no cuts in sectors such as health, education and social security against a backdrop of substantial military investment, challenging the government to review the targets it has set.
In a question addressed to the Ministry of Finance, Fabian Figueiredo cites information published by the Ministry of Finance's Office for Planning, Strategy, Evaluation and International Relations (GPEARI).
«In this study presented in the Quarterly Bulletin of the Portuguese Economy, in a scenario where the increase in military expenditure is specifically focused on equipment, infrastructure and research, ‘Portuguese public debt would rise by around 3.2 percentage points of GDP in 2035 compared with a scenario of no policy change'. In this same scenario, ‘the direct tax rate on households would rise by 2.6 percentage points in 2035, contributing to a reduction in private consumption in the medium term'», the question states.
The MP also argues that the figures published by this office «disprove the claim that rearmament would be a driver of development commensurate with its cost», stating that «even in the most favourable scenario, the one most geared towards investment, real GDP is only around 0.2% above the baseline scenario in 2025–2026 and around 0.5% above in 2027–2035, with a fiscal multiplier of 0.50, and only 0.30 if the additional expenditure is current'.» «For every euro diverted to military expenditure, the economy yields, at most, around half back. And it does so whilst households are paying more tax and consuming less: private consumption suffers an average reduction of 0.39 percentage points over the period 2025–2035. The Bulletin also acknowledges that the effects ‘are not self-financing' and require ‘fiscal adjustment' in the medium term — that is, higher taxes or cuts in public spending», writes Fabian Figueiredo.
He accuses the government of pursuing a «combination of obsession with increasing military spending and reducing taxes on the banking sector and large companies», pointing out that the government «has still not introduced the tax on windfall profits, which it promised in May».
In this context, the BE wants to know whether the Government «is willing to review its military spending targets», following NATO's setting of a target of 5% of Gross Domestic Product (GDP) by 2035, with a review in 2029.
«Bearing in mind the study presented by GPEARI in the July 2026 Quarterly Bulletin on the Portuguese Economy, how does the Government guarantee that there will be no cuts to healthcare, education, social security and investment in social housing to finance the increase in military spending?», he asks.
Figueiredo also wants to know how the government «justifies maintaining the reduction in corporation tax whilst, at the same time, forecasting an increase in direct taxes on labour to fund excessive military spending targets».
Finally, the BE asks whether the Government has any «comparative studies estimating the multiplier effects of a budgetary increase equivalent to that planned for defence, if applied to public housing, the national health service, education, the railways or the energy transition».
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