* Transfer of banks' pension funds needed to beat goal
* EU/IMF inspectors have warned against such transfers
* Part of EUR6 bln transfer to pay off debts to suppliers (Adds quotes, details)
By Andrei Khalip
LISBON, Dec 13 Portugal's budget deficit should not exceed 4.5 percent of gross domestic product this year, beating its bailout target of 5.9 percent thanks to a one-off transfer of pension funds, which the prime minister said makes next year's effort more pressing.
In an extract from a video interview posted on daily Correio da Manha's website on Tuesday, Pedro Passos Coelho said: "We will have achieved a lower (deficit number than the target). The deficit number will possibly not be higher than 4.5 percent in 2011."
He was responding to a question on the impact of the near 6 billion euro ($8 billion) transfer, without which Portugal would have missed the target.
Last year the deficit totaled 9.8 percent of GDP. Under the terms of its 78 billion euro EU/IMF bailout, Portugal has to cut the gap to 5.9 percent this year, 4.5 percent in 2012 and 3 percent in 2013.
"Without extraordinary measures our deficit would have been very close to 8 percent this year, while it cannot surpass 5.9 percent," Passos Coelho told reporters later.
"It means that next year we have to do what we are supposed to do, plus what we didn't do this year, given the fact that there was a shortfall in the first half," said Passos Coelho, whose centre-right coalition government took over in June.
EU and IMF inspectors last month praised Portugal's performance under the bailout, but warned the country has to focus on measures that would cut the deficit permanently.
The transfer was agreed with banks after the government discovered a large shortfall it says it inherited from the previous administration, involving around 6 billion euros now accounted for as extraordinary revenue.
Passos Coelho said that part of the money, at least 2 billion euros, would be used to pay debts to suppliers, such as in healthcare.
The government has already suspended holiday and year-end bonuses for civil servants, each equivalent to a monthly salary, and hiked taxes, including on many basic staples, in next year's budget, which is expected to usher in the deepest recession in decades.
This year the government has already slapped a 50 percent tax on year-end bonuses for all workers and raised taxes on electricity and gas bills to help cover the shortfall. But it still relied on the transfer of the bank pension funds to reach the 5.9 percent target. ($1 = 0.7641 euros) (Additional reporting by Daniel Alvarenga; Editing by John Stonestreet)
The Pentagon releases photographs linked to allegations of abuse of detainees in Iraq and Afghanistan.