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The Spanish government is focused on passing its 2011 budget this autumn, a leading politician for the ruling Socialists said, playing down the risk of early elections if the budget fails to get parliamentary approval.

The budget, which will be presented to lawmakers by the end of September, will contain 10 billion euros ($12.72 billion) of spending cuts and needs the backing of small, regional parties to pass.

"The government is only working under the hypothesis that it will have a budget," Leire Pajin, leader of the Socialist party PSOE told Cadena Ser radio in an interview on Sunday.

As Spain struggles to emerge from recession and fend off worries over its ability to fund its debt, Socialist Prime Minister Jose Luis Rodriguez Zapatero has promised huge spending cuts while he tries to keep his unpopular government in power until 2012 elections.

Zapatero''s Socialists have 169 seats in the lower house, seven seats short of an absolute majority. The conservative PP party, which has 153 seats of out of 350, is very unlikely to support the budget, as are the CiU Catalan nationalists, with 10 seats.

Small leftist parties will also oppose the budget, especially as a Sept. 29 general strike by unions opposed to austerity measures will galvanise popular opposition to the Socialists'' newly austere economic policy.

More political self-governance

Zapatero is expected to make concessions to the Basque National Party (PNV), with six seats, and other centre-right parties from regions such as the Canary Islands and Navarre, with three seats between them.

The PNV has offered its support but only in return for more political self-governance. Aware of its negotiating power, it has already started to signal the threat of early elections if the budget is not passed.

"(Without a budget) it would be inconceivable and irresponsible for the government to try to complete its term," PNV spokesmanJosu Erkoreka told Europa Press in a interview on Saturday.

Spain''s two most widely read newspapers, El Pais and El Mundo, both mentioned the possibility of early elections on their front page on Sunday. "If there''s no budget, the government''s situation would be so unsustainable that it would have to bring forward elections," El Pais quoted an unnamed Socialist minister as saying.

The government admits it cannot roll over its 2010 budget to next year considering the significant cuts needed to bring the country''s public deficit, which stood at 11.2 percent of gross domestic product in 2009, within EU limits by 2013.

"That''s why the government is only contemplating the possibility of approval by talking to all of the political parties," Pajin told Cadena Ser.

In additional to the budget debate, Zapatero will also be dealing this autumn with the Sept. 29 general strike, organised by the unions -- the Socialists'' traditional support base – and regional elections in Catalonia, where the CiU Catalan nationalists expect to beat the ruling Socialists.

The autumn Socialist primaries for regional elections in Madrid will also be closely watched since Tomas Gomez, the leader of the Socialist Party in Madrid (PSM), has decided to run against Health Minister Trinidad Jimenez despite Zapatero''s support for his minister.