LISBON, Portugal -- Portugal's prime minister says his bailed-out country must make deeper cuts in public services to compensate for a court ruling that prohibited some tax increases.
Pedro Passos Coelho said in a televised address to the nation Sunday that Portuguese lives "will become more difficult," though he said he won't increase taxes.
He said a new crackdown on government spending will focus on social security, education, health services and state-run companies. That is likely to bring layoffs.
Portugal is struggling to repair its finances after it needed a 78 billion euro ($101 billion) bailout in 2011.The Constitutional Court rejected pay cuts for government workers and pensioners, leaving the government just nine months to make up for the sudden shortfall in its estimated savings of 1.3 billion euros this year.