Portugal’s centre-left Socialist Party was re-elected with an unexpected majority on Sunday, beating its main rival the centre-right Social Democratic Party.
The vote was held amid a surge of Covid-19 cases caused by the Omicron variant.
The Socialists won 41.7 per cent of the vote and 117 seats in the 230-seat Parliament, up from 108. Despite predictions of a tight race, the Social Democrats (PSD) landed 27.8 per cent for 71 seats.
Four seats still need to be decided in the coming days, with the results of votes cast abroad, but in 2019 the Socialists received two.
Prime Minister Antonio Costa has relied on two far-left parties to prop up his minority Socialist governments since 2015.
“An absolute majority doesn't mean absolute power. It doesn't mean to govern alone. It's an increased responsibility,” Mr Costa said in his victory speech.
“The conditions have been created to carry out investments and reforms for Portugal to be more prosperous, fairer, more innovative.”
The Socialist Party, which has governed for the past six years, and the PSD have alternated in power for decades.
The vote also handed gains to far-right party Chega (Enough), which became the third-biggest contingent with 12 seats, up from one, mirroring the rise of such formations elsewhere in Europe.
“Everything is going to be different in Parliament,” Chega leader Andre Ventura, a former TV sports commentator, told his supporters.
“From now on there won't be a soft opposition. We will assume the role of being the real opposition to the Socialists and restore dignity to this country.”
Sunday's snap poll was called after two far-left parties that had propped up Mr Costa's minority government sided with right-wing parties to reject his 2022 draft budget in October.
Turnout was between 46 and 51 per cent, according to the exit poll. At the last election in 2019, the turnout was 48.6 per cent.
About 1 million people aged over 18 were in home confinement on Sunday because of Covid-19 infections, health authorities said. They were allowed out to cast their ballots.
The stakes are high. Portugal, a country of 10.3 million people, is poised to begin using €45 billion ($50bn) of aid as a member of the EU to help spur the economy after the Covid-19 pandemic.
Two thirds of that sum is intended for public projects, such as major infrastructure, giving the next government a financial bonanza. The other third is to be awarded to private companies.
President Marcelo Rebelo de Sousa, in an election-eve address to the nation, urged people to vote, declaring it “a way of saying that … nothing, and nobody, can silence our voice”.
He said the coming years would be marked by “leaving behind a painful pandemic (and) an urgent rebuilding of the economy”.
Miguel Morgado, 49, a company manager voting in Lisbon, the capital, said he wasn’t worried by the high virus infection rate and hoped the country would soon be back to normal.
“Above all, it is our civic duty to vote. The country needs it,” Mr Morgado said.
Since it came to power in 2015, the Socialist Party had relied on the support of its smaller allies in Parliament — the Left Bloc and the Portuguese Communist Party — to ensure the annual state budget had enough votes to pass.
But last November their differences, especially over public health spending and workers’ rights, were insurmountable, leaving Socialist Prime Minister Antonio Costa short of votes to pass his party’s plan.
The Socialist Party promised to increase the minimum monthly wage, earned by more than 800,000 people, to €900 ($1,020) by 2026. It is currently €705.
Low wages are a common grievance among voters. The Socialists also want to “start a national conversation” about working four days a week instead of five.
The Social Democratic Party is promising income tax cuts and more help for private companies, cutting corporate tax from 21 per cent to 17 per cent by 2024.
The winner will also have more deep-rooted problems to address, including an economy that cannot gain traction.
Portugal’s economy has been falling behind the rest of the 27-nation EU since 2000, when its real annual gross domestic product per capita was €16,230, compared with an EU average of €22,460.
By 2020, Portugal had edged higher to €17,070 while the bloc’s average surged to €26,380.
