(1)

paragraph 7 is replaced by the following: ‘7. Portugal shall adopt the following measures during 2013, in line with specifications in the Memorandum of Understanding: (a) The general government deficit shall not exceed 4,5 % of GDP in 2013. The 2013 budget shall include permanent consolidation measures of at least 3 % of GDP aiming at reducing the general government deficit within the timeframe referred to in paragraph 3. The Portuguese Government shall explore ways to increase the weight of expenditure reduction in the overall consolidation package for 2013 in order to ensure a medium-term growth-friendly fiscal adjustment tilted towards the expenditure side. Given budgetary execution risks, the Portuguese Government shall prepare contingency measures of 0,5 % of GDP by early 2013 which should be activated in case of a materialisation of such risks. (b) The 2013 budget shall include revenue measures, in particular restructuring the personal income tax by simplifying the tax structure, increasing the average tax rate while preserving progressivity and broadening the tax base through the elimination of some tax benefits; broadening the corporate income tax base; increasing the investment income tax rate; increasing excise taxes; and introducing changes in recurrent property taxation. (c) The 2013 budget shall include expenditure-saving measures, in particular rationalising public administration, education, healthcare and social benefits; reducing the wage bill by decreasing permanent and temporary staff and reducing overtime pay; streamlining public and private social transfers and subsidies; reducing transfers to local and regional authorities; and lowering operational and capital expenditures by SOEs. (d) Portugal shall continue implementing its privatisation programme. (e) Portugal shall develop common revenue forecasting guidelines for regional and local authorities. (f) Portugal shall deepen the use of shared services in public administration. (g) Portugal shall reduce the number of local branches of line ministries (e.g. tax, social security, justice) by merging them into the “Lojas do Cidadão” (administration and utilities single points of contact) and developing further the e-administration over the duration of the Programme. (h) Portugal shall continue the reorganisation and rationalisation of the hospital network through specialisation, concentration and downsizing of hospital services, joint management and joint operation of hospitals, and shall finalise the implementation of the action plan by the end of 2013. (i) With the support of internationally-renowned experts and following the adoption of the amendments to Law 6/2006 on New Urban Lease and of the decree law which simplifies the administrative procedure for renovation, Portugal shall undertake a comprehensive review of the functioning of the housing market. (j) Portugal shall develop a nationwide land registration system to allow a more equal distribution of benefits and costs in the execution of urban planning. (k) Portugal shall make fully operational the management tool to analyse, monitor and assess the results and impacts of education and training policies and shall establish the professional schools of reference. (l) Portugal shall complete the adoption of the outstanding sectorial amendments necessary to fully implement Directive 2006/123/EC of the European Parliament and of the Council of 12 December 2006 on services in the internal market (4). (m) Portugal shall implement targeted measures to achieve a steady reduction of the backlogged enforcement cases with a view to resolving the backlog of court cases. (n) Portugal shall adopt the framework Law on the main national regulator authorities in order to guarantee their full independence and financial, administrative and management autonomy. (o) Portugal shall improve the business environment by completing pending reforms on the reduction of the administrative burden (Points of Single Contact provided for by Directive 2006/123/EC and “Zero Authorisation” projects) and by carrying out further simplification of existing licensing procedures, regulations and other administrative burdens in the economy which are a major obstacle for the development of economic activities. (p) Portugal shall complete the reform of the port work legislation and the ports’ governance system, including the overhaul of port operation concessions. (q) Portugal shall implement the measures enhancing the functioning of the transport system. (r) Portugal shall implement the measures eliminating the energy tariff debt and fully transpose the Third EU Energy Package.