Spain's Socialist party tells acting PM to look elsewhere for support

Spain’s Socialist party, PSOE, refused to break the eight-month political impasse on Friday, by supporting the conservative party and forming a coalition government.

The leader of the Socialist party, Pedro Sanchez reportedly told acting prime minister and leader of the centre right People’s Party (PP) Mariano Rajoy to look elsewhere, which suggested Spain could be heading towards a third general election by the end of the year.

Sanchez said: "I'm warning you that the Socialists will not only vote against [Rajoy] in the investiture vote but also, to be consistent, if he is invested as the next prime minister we will vote against his budget, which I'm sure will include more spending cuts.

"What Rajoy needs to do is to keep talking to potential allies, and we are not among them”.

Rajoy said he is ready to face a parliamentary confidence vote for a second term in office, but faces a problem in winning the vote. His party lacks a majority and needed the support of the Socialist party, even as it was reportedly nearing a deal with Spain’s fourth biggest party, centrists Ciudadanos. If Rajoy gains support from Ciudadanos he is still shy of seven seats for an absolute majority.

Sanchez faces the choice of joining the centre-right party or triggering a third election, which would likely fall on Christmas day.

Under Spanish law, there has to be a period of 54 days before the election, and if Rajoy fails to win the confidence vote on 30 August, parliament would need to be dissolved for two months, and Spanish ballots are traditionally held on a Sunday making 25 December the likely date.

If the Socialist party abstains from the confidence vote it could be enough for the PP and Ciudadanos to form a minority government.

Spain had two inconclusive elections in December 2015 and June where no party gained an outright parliamentary majority and a coalition government could not be agreed upon.