Spain's left-wing Sumar leader Yolanda Diaz and Spain's acting Prime Minister and Socialist Party (PSOE) leader Pedro Sanchez sit on the day of a parliament session where lawmakers vote for a speaker and for members of the parliament's executive board, as Spain's new parliament is constituted, following an inconclusive snap election on July 23, opening the race for PM nomination, at the Spanish parliament, in Madrid, Spain, August 17, 2023. REUTERS/Violeta Santos Moura
MADRID (Reuters) -Spain's Socialist Party and the hard-left Sumar have reached a coalition agreement to form a new government, both parties said on Tuesday, with the deal including a proposal to reduce working hours without changing salaries.
The agreement came after acting Prime Minister Pedro Sanchez met with Sumar leader and acting Labour Minister Yolanda Diaz on Monday. Sanchez requires the support from Sumar's 33 lower-house lawmakers - as well as from other parties, including some advocating for Catalan and Basque independence - in his bid to renew his term as premier.
"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 also includes plans to reduce youth unemployment, reinforce the public healthcare system, boost public housing, raise emission reduction targets and a tax reform targeting banks and large energy companies, the statement added.
While Sumar's support is crucial, it is not enough to secure Sanchez's investiture in the lower house. He still needs the backing of Catalan separatists, who are demanding an amnesty law to mass pardon people involved in the region's failed independence bid of 2017.
If the Socialists and Catalan pro-independence parties fail to reach an agreement, the country will go to another election in January in which voters could hand a centre and far-right coalition the absolute majority it narrowly missed out on in the last vote on July 23.
(Reporting by David Latona; Editing by Ed Osmond and Aislinn Laing)
