4 May 2013

Portugal plans to raise retirement age to 66

6:00 pm on 4 May 2013

The Portuguese government plans to cut 30,000 civil service jobs and to raise the retirement age by one year to 66 as it tries to meet the terms of a bailout.

Prime minister Pedro Passos Coelho says civil servants will also be required to work 40 hours a week instead of 35.

He says the proposals, which would take effect mostly from next year, would save $7.4 billion over three years.

Austerity measures have already proved deeply unpopular, triggering big protests.

Unemployment now stands at nearly 18% - a record high - and the economy is expected to shrink for a third consecutive year in 2013.

Portugal got a $120 billion bailout from the European Union, the European Central Bank and the International Monetary Fund in 2011.