Fresh eurozone crisis as Portugal court blocks austerity measures

Portugal's constitutional court has ruled against the country's planned austerity programme, putting its £78bn bailout package in jeopardy and creating a fresh crisis for the eurozone.

The court voted against cuts in state pensions and public sector wages, arguing the measures are in breach of the constitution. According to the Financial Times, Portuguese state pension holders faced 7% losses on their annual income. The planned cuts would have saved Portugal £1.3bn annually, around 20% of the €5bn the government had forecast to obtain from its austerity measures this year. Pedro Passos Coelho, Portugal's prime minister, said the rejection posed "serious obstacles and risks" to the country's progress. He added Portugal will have to pursue other spending cuts, m...