Portuguese politics part two
Things get messy
In our last post about Portuguese politics, we briefly summarized how the government here is organized and where things stood when we arrived in Lisbon in June, 2022.1
This post will focus on the time between the 2022 election and the collapse of the PS government. Our (hopefully) final installment will outline what happened next and take a peek at what might lie ahead.23
Before we go any farther, we should mention that in addition to the president, prime minister, and elected legislators in the Assembly, other people are needed to keep the government running. The prime minister appoints a Council of Ministers,4 essentially the cabinet, each of whom heads a specific department. These are equivalent to “secretaries” in the US so rather than, say, a Secretary of Defense or a Secretary of Agriculture, here we have a Minister of National Defense and a Minister of Agriculture and Food. And each minister has under them one or more secretaries of state, essentially deputy ministers who have their responsibilities determined by either their minister or, occasionally, the prime minister.
Let’s return to where things stood a couple of years ago: After the January 2022 elections had given the center-left Socialist Party (PS) an unexpected outright majority, all seemed ready to proceed smoothly once the new government was sworn in on March 30.
Things did not go as planned.
Messiness
As overwhelmed as we were in the months after our arrival in Lisbon, it was impossible to escape headlines, many of which fell into one of two categories:
strikes and demonstrations
high-level government resignations and dismissals
Strikes and demonstrations
A (likely incomplete) list of groups that have gone on strike since we’ve arrived:
teachers (Nov. 2, 2022)
cabin staff at Portugal’s state-owned airline TAP (December 8-9, 2022)
teachers (an “indefinite” strike ending in April, 2023 after about four months)
nurses (May 12, 2023, International Nurses’ Day)
railway workers (June/July, 2023)
police officers (July 2023)
doctors (two-day national strike in August, 2023)
doctors (regional strikes throughout August, 2023)
teachers (week-long strike in September, 2023)
teachers (Oct. 6, 2023)
civil servants (late October, 2023)
doctors (November 14 & 15, 2023)
nurses (two weeks from December 12-26, 2023)
railway management (January, 2024)
nurses (several days in late April/early May, 2024)
And the mass demonstrations:
by teachers
and for more affordable housing
There were also a handful of strikes averted due to last-minute agreements between the workers (usually airline, Metro or railway) and the government.
At this point, you may be wondering:
Why is all of this happening? What are people so unhappy about?
The usual answers apply here: wages and working conditions. However, it’s worth a brief5 peek into these major issues as many play into our larger theme.
Issues
The following visuals summarize pretty quickly some of the biggest challenges facing Portuguese society as a whole.
This is not a new issue. While these data are from 2023, they could as easily be from 2003. For decades, Portugal has consistently been more on par from a wage standpoint with eastern European countries than with those in its region.
One result has been a steady stream of Portuguese in their 20s and 30s leaving the country for better financial opportunities.6
This contributes to a relative lack of educated professionals (like, say, doctors, nurses and teachers) …
… as well as a high “old-age dependency ratio.”
While the population of Europe as a whole is aging, Portugal is on the leading edge of the curve.
Portugal also suffered a prolonged economic slump in the early 2000s compounded by the global recession in 2008. From 2011-2014 Portugal received a financing package of 78 billion euros from the European Union (EU), International Monetary Fund (IMF), and the European Financial Stability Facility (EFSF). The Portuguese government was led by the center-right PPP/PSD at the time and they instituted austerity measures that included salary cuts for public servants (in Portugal this group includes teachers and doctors) and tax hikes. The effectiveness, or lack thereof, of these policies is
still hotly debated today
well beyond the scope of this blog7 (if you’re interested, though, try this article).
Another important development in 2012, for our purposes, is the government’s institution of the Golden Visa. This immigrant investment program granted residency and an accelerated path to citizenship for anyone who invests in properties worth more than 500,000€ or creates at least 10 jobs in Portugal. We’ll return to this later.
Against this larger context, different industries have specific complaints that lead to the present-day strikes. Remember, public school teachers and medical professionals working in the public health system8 draw paychecks from the federal government.
In brief,9 here are some of the major concerns of some of the striking groups:
Teachers
While Portugal is a relatively small country - it’s basically the size of the state of Indiana - it can still take five or more hours to drive from, say, Braga in the north to, say, Faro in the Algarve. Which is fine if you’re looking for a getaway over a long weekend. It’s less fine, though, if you live in one of those municipalities and are sent by the government to work in the other.
That’s one reality facing some Portuguese teachers, many of whom have no control over where they teach from year to year. A shortage of qualified personnel is one factor that determines where people are assigned. And that shortage is likely to worsen unless some steps are taken as more than 50% of the teachers in the country are older than 50 and new graduates are not keeping pace with retirees from the profession.
For more on why teachers have been striking, click here, here, and/or here.
Doctors & nurses
Medical professionals are also suffering from overwork due in large part to a lack of qualified individuals, at least in part because salaries and working conditions are better elsewhere in Europe for both doctors and nurses.
Portuguese doctors are contracted to work 150 hours of overtime annually. Due to staffing shortages, most doctors work more than that. So when doctors went on strike in 2023 that usually took the form of adhering to the language of their contracts and not working beyond their required 150 hours of overtime, effectively closing some departments and rescheduling surgeries.
Portuguese nurses are reacting in part to disparities in pay and working conditions between the public and private sectors. There are also concerns about a lack of prospects for advancement as well as staffing shortages, among other issues.
Police officers
There are three different types of police in Portugal:
Polícia Judiciária (PJ), essentially the “major crimes” unit; fighting and investigating murders, terrorism, organized crime, drug rings, et al
Polícia de Segurança Pública (PSP), the national civil police force; uniformed officers in more urban areas
Guarda Nacional Republicana (GNR), military personnel responsible for preventative policing and highway patrol in most of the country
Last November, the PJ was given a hazard pay increase and the PSP and GNR have demanded a similar bump for their duties.
The PSP refused to work at least one football match (officers called in sick), after which there were clashes between fan groups, and their union leader hinted at the possibility of a coup d'état.
Affordable housing
We mentioned we’d come back to the Golden Visa and this is a good place to do so. The immigration scheme started in 2012 has ushered more than 7 billion euros into the Portuguese economy via foreign investors.10
This has also helped spur a boom in the construction of high-end properties and a spike in housing values, felt most keenly in Lisbon where it has become more and more difficult for the average Portuguese to find a place to live. The EU-wide spike in inflation in late 2022 didn’t help any, either. Many of those investment properties were turned into Alojamento Local, short-term rental units advertised on websites like Airbnb.
To address the crisis, the majority PS government instituted a multi-faceted plan called Mais Habitaçao (more housing) in mid-May 2023. The plan attempted to address issues like the lack of housing supply by offering tax incentives to owners who converted their AL apartments to long-term rental units and suspending the issuance of new AL licenses in many parts of the country, among other measures. It also limited the ability of landlords to raise rents.
Many of the cornerstones of the plan were quite controversial and/or confusing. For example, there was a provision that allowed the government to give 90 days notice to owners of properties in urban areas that have been abandoned for more than two years that they must either put the property to use or turn over the lease to the government. The plan also called for a halt on the issuance of Golden Visas.
The PS came under fire for implementing these measures without taking into consideration options offered by other parties and for not clearly communicating the specifics of the plan.
TAP, the scandal that wouldn’t quit
Transportes Aéreos Portugueses (TAP) is a state-owned airline founded on March 14, 1975. It has been privatized and … um … un-privatized? De-privatized? Re-stateisized? several times since and is currently under government control. It’s also a hot mess and while trying to summarize the situation is a challenge, it matters for our purposes because the scandal precipitated one of the above strikes and several of the resignations and dismissals we’ll discuss below.
As the world re-opened after Covid, TAP received €3.2 billion of restructuring aid from the European Commission, a plan that began in July, 2021 and ended in December, 2021 with the Portuguese government purchasing the airline in its entirety using taxpayer money. As part of that plan, TAP reduced staff by 2,900 and wages by 25%, leading to the above-mentioned strikes. In September, 2022, Prime Minister António Costa announced his intention to re-privatize TAP within the next 12 months at a possible financial loss to the government. In December, 2022, things blew up. The timeline:
Feb. 7, 2022: Alexandra Reis, a TAP board member, announced her resignation on February 7, 2022 to “pursue new projects.”
June 30: Reis appointed as the first female Board Chair of NAV Portugal, which provides air traffic control services for the country. The appointment was made by order of the Ministry of Infrastructure, led by Pedro Nuno Santos.
December 2: Reis named Secretary of State for the Treasury by the Minister of Finance, Fernando Medina.
December 23: news broke that Reis received a 500,000€ severance package from TAP despite leaving, apparently voluntarily, with two years left in her term. Reis defended the golden handshake payment saying it was in “strict compliance with the law.” While nobody at the time seemed to disagree with that statement, giving half a million euros of taxpayer money to Reis when the rest of the company was suffering 25% pay cuts certainly didn’t pass the smell test.
December 27: Reis asked to resign from her position in the government. This being Portugal, she complied.
That did not end the scandal, however.
Opposition parties raised questions about what Medina (whose wife was the head of TAP’s legal department and who appointed Reis) and Santos (who, as Minister of Infrastructure, was responsible for TAP) knew about the payment and when they knew it. Santos and Medina demanded answers from TAP, which TAP promptly provided, saying - among other things - that Reis had been asked to step aside and initially asked for nearly 1.5 million euros before the sides agreed to the 500,000. The Prosecutor General launched an investigation.
December 28: Santos, who had been considered a likely successor to Costa as leader of the PS, stepped down after pinning the blame on, and accepting the resignation of, his Secretary of State, Hugo Mendes.11
This also did not end the scandal.
Medina was hauled before parliament for some ‘splainin’ and said that his wife had been on maternity leave when Reis departed and, therefore, had no knowledge of the situation. TAP pilots called for both the CEO and the chairman of the board of directors of TAP to resign.
March 6, 2023: the Inspeção-Geral de Finanças (IGF) concluded that the payment to Reis was illegal and ordered Reis to return it. The government then sacked TAP’s CEO and chair of the board.
And still the scandal lived on.
Almost immediately after being fired, the former-CEO suggested she would take legal action against the government, which, she said, acted illegally in dismissing her.
April 5: two cabinet ministers claimed the government had sought legal advice before firing the CEO.
April 6: Medina contradicted that statement leaving opposition parties in disbelief.
September 5: former-CEO sued TAP for nearly six million euros
February 2024: in an interview with CNN Portugal, former-CEO accused Medina of blackmail and of firing her for political reasons.
The suit is still ongoing as of this writing. The scandal lives on.
Resignations and dismissals
As all avalanches begin with a snowflake, the first departure from the new government seemed innocuous: a secretary of state stepped down for health reasons. That the resignation occurred 33 days after the government was sworn in was maybe a bit strange but, hey, these things happen.
Roughly three months later, on August 29, 2022, Marta Temido, the Minister of Health since 2018 (and one of only seven holdover ministers - out of 19 - from the previous government) who had won widespread acclaim for her managing of Portugal’s Covid vaccination campaign, resigned after criticism of her management of the SNS and some of the doctor strikes.12 Deputy Secretary of State for Health, António Lacerda Sales, and the Secretary of State for Health, Maria de Fátima Fonseca also handed in their resignation in solidarity with Temido.
On November 9, 2022, Dr. Miguel Alves, Deputy Secretary of State to the Prime Minister (described by Reuters as Costa’s “right-hand man”) quit after formally being charged of malfeasance as part of an investigation that had been ongoing since 2019.
Ten days later, the Minister of Economy fired his Secretary of State, João Neves and the Secretary of State for Tourism, Rita Marques, over disagreements about how corporations should be taxed. This triggered the reorganization of the ministries that led to the December 2 appointment of Alexandra Reis of the TAP scandal.
Reis held her position for 25 days, leaving on December 27. Santos and Mendes followed within a day of Reis’ departure.
On January 4, 2023, Carla Alves Pereira was named Secretary of State for Agriculture.13 She submitted her resignation 24 hours later, after it was reported she’d had some bank accounts seized as part of a corruption investigation into her husband, a former mayor of a small municipality on the northern border with Spain.
For those keeping score, that was four departures in a week related to problems that could have been foreseen. And a total of 12 high-ranking officials leaving the government in less than ten months, some of whom served a few weeks or less, and many of whom left under a cloud of controversy and suspicion.
At this point, you may be wondering:
Doesn't anybody, like, vet these people to make sure there are no skeletons in their closets or other major issues that will keep them from performing their duties?
The rest of the country was wondering this as well. A week later, the government announced a new system would be put into place: Potential appointees would answer 34 questions designed to sniff out conflicts of interest and sign a declaration of honor before being considered for a post. The proclamation, somewhat predictably, was met with derision:
“The prime minister is telling us that he will ask questions to the people he invites to the government? He didn't do that before?” - Left Bloc lawmaker Pedro Filipe Soares.
Nobody left the government after that … for about five months. In July, Marco Capitão Ferreira, Secretary of State and National Defense, resigned after being ensnared in a large corruption/money laundering investigation that began in 2018 and eventually resulted in charges being brought against roughly 75 people.
And then things really fell apart.
Our next installment will look at what happened next and what to watch for in the months to come.
We’ve gone on for way longer than we expected to but there was a lot to cover and no logical place to break it off. If you’ve read this far, thank you! And we’re curious:
What similarities and/or differences have you noted between the Portuguese political system and that of others with which you are familiar?
That’s all for now.
Love from Lisbon,
Scott & Amy
Because, you know, it’s all about us, right?
Cuz we can see the future. (It’s turtles all the way down.)
Just for fun, here’s a screenshot of Scott’s Chrome tabs. All of these (and many more) were opened and, usually, read during the writing of these posts.
There are currently 19 people on the Council, which, according to Wikipedia, “discusses and approves bills to be submitted to the Assembly of the Republic and decrees and resolutions.”
We are WAY oversimplifying these issues, most of which have been debated for years and any one of which has been the focus of many people considerably more qualified than we are to comment on them.
Or so we’ve heard both on the interwebs and from some of the millennial Portuguese we’ve gotten to know whose school friends are now living abroad.
Seriously, Scott’s head is about to explode trying to wrangle all of this.
which is most of them as it is common to split time between public and private entities
Seriously brief. We’re deep in the weeds here and trying not to get (too far) beyond the scope of this blog.
The primary investors are Chinese, who received 5407 of the 12 718 (42.5%) residence permits issued between October 2012 and the September 2023. Brazilians are second, receiving 1256 (9.8%), and Americans third (781, or 6.1%) and rising (216 of those were issued in 2022).
It was a sort of “even though I had no knowledge of what happened, it happened in my watch so I’ll fall on my sword” kind of deal.
Among other things, she mandated closures of certain medical facilities due to lack of staffing and a pregnant woman died while being transported from one closed facility to another. This link is in Portuguese but Google translate does an adequate job.
No relation to Miguel, she replaced Rui Martinho who left quietly for health reasons amidst the TAP brouhaha.
Excellent overview for those planning to move to Portugal. Mindful that despite all the craziness described, they don't have a documented liar and criminal endorsed for the presidency by millions of people.
Great post. I won't even ATTEMPT to compare this to where we all come from. :-) At least SOMEONE is being held accountable here - even if only for a minute.