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MADRID, Espagne, Dec 17 AFP

December 18 2012, 10:33AM

Whistles blowing and horns honking, thousands of people have demonstrated in Madrid to defend their pensions from the austerity policies of the right-wing government of Mariano Rajoy.

Spain's government broke a key election commitment in November by saying it would fail to raise pensions in line with inflation in 2013, as the crisis bites into the public finances.

Responding to the calls of unions, pensioners and elderly people thronged the streets of Madrid on Monday to express their rage at the government.

"They're going to leave us in our undershorts," said a 90-year-old pensioner who would only give his name as Jacinto.

"Those in the PP will take more things from us. They have lied to us about everything," Jacinto added, lashing out at Rajoy's Popular Party.

Prime Minister Rajoy said in his election campaign a year ago that he would make cuts "everywhere" but that his top priority was to maintain the purchasing power of pensions.

Since taking power after a huge election victory a year ago, he has made tough spending cuts and tax rises to lower the country's deficit as demanded by the European Union and stabilise the public finances.

Deputy Prime Minister Soraya Saenz de Santamaria said last month that most pensions would be raised by one per cent in 2013, but pensions of less than 1,000 ($A1,257) a month would rise by two per cent.

She said the government had agreed to reform a social security emergency reserve fund so it could dip into it to provide four billion euros to make the extra Christmas payments due to pensioners.

Consumer price inflation was 3.0 per cent in the year to November as a sales-tax increase fuelled inflation in the midst of a recession, figures from the National Statistics Office showed last month.

Protests against the government's austerity policies have become daily events in Madrid and in other Spanish cities where doctors, teachers and other professionals go on strike.