ONCE again a fragile Greek government has pushed delayed reforms through parliament at the behest of the European Union and the IMF even as angry protesters in the square outside demand its resignation. At stake was a desperately needed €6.8 billion slice of Greece’s bail-out. The vote on July 17th to cut 15,000 civil-service jobs and overhaul the tax system was close, mainly because Antonis Samaras, the centre-right prime minister, has seen his majority cut to just five seats after the small Democratic Left party pulled out of his three-party coalition.

Mr Samaras had to produce a last-minute ace to win over dissidents. Hours before the vote, he announced that an unpopular 23% value-added tax on restaurants, cafés and bars would be temporarily cut to 13% on August 1st. If this produces more revenue, as the finance ministry predicts, it will stay. The EU and IMF are sceptical but ready to try it. The announcement came just before Wolfgang Schäuble, the German finance minister, visited Athens to urge the Greeks to stick to reforms and to unveil a German-Greek fund to back small Greek companies.

Mr Samaras’s slimmed-down coalition of his New Democracy party and the PanHellenic Socialist Movement (Pasok) under Evangelos Venizelos, who is now deputy prime minister and foreign minister, may prove more forceful than its predecessor. Mr Venizelos is busy preparing for Greece’s turn in the EU presidency in the first half of 2014. Kyriakos Mitsotakis, the public administration minister, must sack 4,000 public employees this year and another 11,000 in 2014. First to go will be 2,000 state-television staff, followed by municipal police officers, hospital workers and vocational-training teachers. The old life in the civil service, with higher salaries and fewer hours than in the private sector, is over. “The game has changed for good,” says Mr Mitsotakis.

Yet there are few signs of an economic recovery. IOBE, a think-tank, says GDP will shrink by as much as 5% this year, worse than its earlier forecast of 4.6%. Unemployment is expected to rise from 26.9% today to 30% next year. And privatisation receipts are disappointing: Greece will miss this year’s target by a wide margin.

The picture is only a little better in Portugal, where the costs of two years of unremitting austerity have pulled Pedro Passos Coelho’s ruling coalition apart, triggering a political crisis. The latest twist came when President Aníbal Cavaco Silva intervened ineptly to ask the two coalition parties and the centre-left Socialists, the main opposition party, to hammer out a “national salvation” pact. Yet the gulf between the centre-right ruling parties and the Socialists is so wide that the chances of their meeting a self-imposed deadline of July 21st for an agreement are small.

The president’s aim was to give investors and Portugal’s lenders—the “troika” of the EU, IMF and European Central Bank—some guarantee that the mainstream parties, supported by about 80% of voters, remained committed to the country’s bail-out programme and that future governments will stick to fiscal discipline. Yet the danger is that, after prolonging Lisbon’s political crisis for a few more weeks, it could produce nothing at all, leaving the country as it was: ruled by an unstable coalition and facing the threat of a snap election with unpredictable results.