Gonzalez chided on Spain's jobless

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SPAIN'S conservative opposition leader Jose Maria Aznar told the Prime Minister, Felipe Gonzalez, 'you have lost all credibility' and called on him yesterday to dissolve parliament and hold an immediate general election.

Mr Gonzalez had gone before parliament to defend his economic policies and announce measures aimed at slashing the 20 per cent jobless rate. But in what was seen as Mr Aznar's opening shot in the unofficial election campaign, he launched a scathing attack on Mr Gonzalez and his government.

'You have led the economy into a cul-de-sac. Your policy has been an unmitigated flop. We're worse off than we were in 1989 (when Mr Gonzalez was last re- elected). Your government is weakened, divided and incapable of taking the necessary measures for recovery,' Mr Aznar, leader of the Popular Party (PP), said.

Mr Gonzalez, whose Socialist Party has governed since 1982, has to call elections by October. With his and the party's popularity at an all-time low, and opinion polls showing Mr Aznar running him close, many predict the campaign will be the dirtiest in Spain's modern history. Friends of both men say they cannot stand each other.

Political tension was high before yesterday's debate after newspapers published remarks by Mr Aznar in which he accused Mr Gonzalez of operating 'a strategy of fear, by stirring the ashes of the Civil War'. He was referring to statements by the Prime Minister a few days earlier when he likened Mr Aznar's party to 'the satraps of the right who robbed us of our dignity as a people' during the Civil War.

Mr Gonzalez appears intent on holding out until the last possible moment before calling the election, gambling that the worst of recession will be over. Many economists here believe, however, that the crisis, with the country sliding towards zero or even negative growth, may then be at its peak.

Mr Gonzalez was forced to take action on unemployment after figures last week showed that the number of unemployed at the end of last year had crossed the psychological barrier of 3 million, or 20 per cent of the workforce. He told MPs that funds would be made available to encourage employers to prolong temporary contracts or make them permanent; new companies would receive tax concessions; more credit would be offered to small and medium businesses and up to 1,000bn pesetas ( pounds 6bn) would be spent on new roads by 1996.