Reuters International

MADRID (Reuters) - Spanish political parties have agreed to pick Public Works Minister Ana Pastor from the centre-right People's Party (PP) as parliamentary speaker, acting Prime Minister Mariano Rajoy said on Monday.

The agreement reached between the PP and the liberal newcomers Ciudadanos ("Citizens"), who came in fourth in June's inconclusive general election, could potentially strengthen Rajoy's position as the PP seeks to form a government.

The election on June 26 produced Spain's second hung parliament in six months, with the PP winning the most votes but once again falling well short of a majority as strong backing for two newcomer parties splintered the political landscape.

The PP was the only party to make marked gains since a Dec. 20 election, however, winning 137 seats in Congress, the lower house of parliament, versus 123 last time.

That is far from the 176 needed for an absolute majority and means Rajoy still needs to persuade reticent rivals to back him, whether by abstaining in confidence votes or actively entering a coalition.

But the threat of a third election that could alienate voters and derail an economic recovery puts the parties - including its traditional opponents the Socialists - under increasing pressure to enable a conservative PP-led government.

The role of speaker in parliament is a largely symbolic one involving moderating debates. After December's vote, the second-placed Socialists had clinched the position with support from Ciudadanos, which came fourth in the two elections.

Unidos Podemos ("Together We Can"), a leftist party, came third both in June and December.

Spain's parliamentary activity is set to resume on July 19. The first confidence vote on any viable government proposal would likely take place after Aug. 2 if Rajoy can get the backing he needs.

So far the Socialists have remained steadfast in their refusal to back any government led by the PP. Ciudadanos has said it would abstain in the so-called investiture vote to enable a conservative government.

(Reporting by Andres Gonzalez, Sarah White and Jesús Aguado; Editing by Tom Heneghan)

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 Reuters International