Portuguese Socialists Sent Off in Football Row Election

Portugal took a turn to the right yesterday after voters ended six years of Socialist rule and gave a narrow victory to the Social Democrats of the former foreign minister Jose Manuel Durao Barroso.

Mr Durao Barroso, accused of wanting to introduce Thatcherite reforms, had fought a campaign that criticised lavish public spending on, among other things, the Euro 2004 football championships.

That expenditure had failed to boost the Portuguese economy which was predicted to fall even further behind the rest of the European Union.

The Social Democrats collected 40.12% of the vote compared with 37.85% for the Socialists. The Popular party, which opposes immigration and abortion, gained 8.75%.

The result left the Social Democrats short of achieving an absolute majority in the 230- seat parliament. It was not clear last night whether Mr Durao Barroso would try to form a minority government or would seek a coalition partner with a smaller party.

Mr Durao Barroso had centred his economic programme on a "fiscal shock" of corporate and income tax cuts, and slashing public spending, which has risen to nearly half of GDP.

Widespread claims of corruption and chaotic public services also worried voters.

The outgoing Socialist prime minister, Antonio Guterres, called yesterday's election two years early after his party's drubbing in December's local elections. But the new candidate, ex-public works minister Eduardo Ferro Rodrigues, failed to revive its fortunes.

The row over spending on Euro 2004 put the ruling party under fire for funnelling £245m of public funds into a single sporting event.

Anibal Cavaco Silva, the former PSD prime minister who gave way to the Socialists six years ago, said Portugal should never have accepted them.

"We will lose economic growth because we have invested in stadiums and not in factories, industry or human resources," he said.