Portugal's anti-austerity government reverses civil servants' pay cuts, restores full wages

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Portugal's new Socialist government is restoring full pay to civil servants after four years of cuts, ticking off another item on its anti-austerity to-do list.

Under legislation approved Friday, pay increases will be phased in over next year until previous pay levels are reached in October.

Cuts of up to 10 percent for staff earning more than 1,500 euros ($1,620) a month came into force in 2011 — the year Portugal needed a 78 billion-euro ($84 billion) bailout. The cutbacks aimed to lower the country's huge debt burden, but government debt remains the third-highest in the 28-nation European Union at 130 percent of annual GDP.

Since taking office last month, the government has announced increases in old-age pensions and family allowances. It is also reducing or eliminating a super-tax.