Socialists, Sumar unveil Spanish coalition pact

Reduced working hours feature in deal that strengthens Sanchez's bid for PM

Spain's Socialist Party and hard-left Sumar announced a coalition agreement to form a new government on Tuesday, including a proposal to cut back working hours without altering salaries.

Pedro Sanchez, who was elected prime minister in 2018 and has been acting leader since the summer, edges closer to securing another term following the coalition deal, the culmination of discussions with Sumar leader and acting Labour Minister Yolanda Diaz.

The effort to form a new government comes after an inconclusive election three months ago left the country with a hung parliament.

The snap election in July saw the conservative Popular Party, or PP, finishing first but lacking enough votes to form a government. Sanchez's Spanish Socialist Workers Party, or PSOE, came second in the election.

Any potential coalition would need to win the backing of other parties in Parliament and must pass a confidence vote, the date of which has not yet been set.

Sanchez's bid for another term now hinges on not only the backing of Sumar's 33 lower-house lawmakers but also support from Catalan and Basque independence advocates, reported the Reuters news agency.

"This governing deal for a four-year legislative term will allow our country to continue growing in a sustainable manner and with quality employment, developing policies based on social and climate justice while broadening rights, feminist conquests and freedoms," the parties said in a joint statement.

The agreement seeks to curb youth unemployment, strengthen public healthcare, improve public housing, increase emission reduction targets and instigate tax reforms aimed at banks and large energy companies, according to the statement.

The deal includes plans to reduce working hours while preserving the same pay — effectively cutting the official working week to 37.5 hours from the current cap of 40 hours. Both parties have also pledged to regulate job cuts, a measure that gained flexibility in Spain following the 2012 labor reform.

To form a government, Sanchez must gain the support of the smaller regional parties, including hardline Catalan separatists JxCat.

The separatists say they will only give their backing to Sanchez in return for an amnesty law to mass pardon people involved in the region's failed independence bid of 2017, a proposal that has triggered opposition from the right and divisions within Sanchez's own party over rule-of-law concerns, reported Agence France-Presse news agency.

Parliament will be dissolved and another election set in January if Socialists and Catalan pro-independence parties cannot reach agreement by the deadline of Nov 27.