Fresh from a second consecutive election victory, Spain's Socialists began to prepare a public works programme today to reinvigorate a flagging economy.
Prime Minister Jose Luis Rodriguez Zapatero, who boosted his tally of parliamentary seats but once again fell short of an absolute majority, said he would approach smaller parties to forge alliances.
Spain's Prime Minister Jose Luis Rodriguez Zapatero at a news conference at the Socialist party headquarters in Madrid
"There are a number of parties we can speak to," an exhausted-looking Mr Zapatero told a news conference. "Obviously we're going to be talking to all of them," he said, without specifying whether he would be seeking a permanent alliance or simply continue as he has over the past four years, with different deals for different legislation.
The Socialists gained five seats for a total of 169 in the 350-seat parliament. The opposition conservative Popular Party (PP) also gained five seats to reach 153, while smaller left-wing parties and some nationalist parties lost ground.
Yesterday's turnout was a high 75 per cent, in an election overshadowed by the assassination of a former Socialist councillor in the Basque Country, blamed on ETA rebels.
Participation almost matched that of 2004, when voters galvanised by the PP government's mishandling of an Islamist attack on Madrid trains handed the Socialists a surprise win.
Mr Zapatero (47) started his victory speech by remembering the five deaths attributed to Eta since it ended a ceasefire in December 2006 after he had made peace overtures.
"We feel the absence of all victims of terrorism. They live on in our memory," said Mr Zapatero, who has ruled out negotiating with Eta in his second term.
Mr Zapatero had promised to govern for the poor, women and the young, continuing the progressive note of his first term, during which he legalised gay marriage and made divorce easier in the once deeply Roman Catholic country.
But with Spain's long economic boom slowing sharply since the global credit crunch bit late last year, his first priority will be to tackle unemployment, which rose by 50,000 in February alone to 2.3 million.
The government hopes increased spending will keep economic growth at 3 per cent after 3.8 per cent expansion last year, but some private economists, worried by high levels of debt in both households and firms, fear it could fall as low as 2 per cent.
Labour Party leader Eamon Gilmore congratulated the Socialist Party on their victory today. "This was an important victory for democratic forces and is, I hope, an indication that people in that area are turning away from violence and will now seek a resolution of political differences through exclusively peaceful and democratic means," he said.