Policy Performance


Economic Policies

Despite strong gains in recent years, Portugal falls into the bottom ranks internationally (rank 37) with respect to economic policies. Its score on this measure has improved by 0.7 points since 2015.

Austerity measures have continued despite a clean exit from its crisis-era bailout program in 2014, with no major new reforms implemented. Deficits have fallen considerably, reaching the sub-3% level. Unemployment rates remain high but falling, with figures reflecting the influence both of growth and significant emigration.

Minimum wages have been slightly increased, and the term of validity for collective-bargaining agreements reduced, though changes show little overall effect on labor-market flexibility or unemployment. The corporate tax rate was reduced, but income and consumption tax rates remain high. A number of new “green taxes” have been imposed.

Public and private R&D funding fell substantially during the crisis period.

Social Policies

With its social system stressed by crisis, Portugal scores relatively poorly overall (rank 29) in the area of social policies. After a slight decline last year, its score on this measure is now 0.1 point above its 2014 level.

The government has placed new focus on technical and vocational education, and is seeking to decentralize control of schools. The resulting turbulence has undermined effectiveness in the short term. Austerity has reduced already-poor overall education quality.

The universal health care system produces comparatively good outcomes. However, spending cuts have undermined inclusiveness and quality. Paternity leave has been expanded, and flexible-work laws should make it easier to work and parenting. Birth rates have stabilized after precipitous decline.

Safety-net policies do not effectively prevent poverty. Pensions have been cut and retirement ages increased. Integration programs remain effective, though immigration has fallen since the crisis. Crime rates remain low.

Environmental Policies

With reasonable outcomes despite policy gaps, Portugal receives middling overall scores (rank 22) with regard to environmental policies. Its score on this measure remains unchanged since 2014.

The government has failed to implement adequate policies on the issues of climate change, protection of water resources, biodiversity and forest conservation. However, the decline in economic activity has reduced CO2 emissions and mitigated other factors contributing to environmental pressure.

A National Strategy for Sustainable Development has long been under discussion, but has not yet been concluded. The country has signed the Kyoto Protocol, and works through the European Union on international environmental issues. It is particularly active in promoting global protection of marine environments.



Quality of Democracy

Despite its overall legalistic society, Portugal receives a middling score (rank 20) with regard to its quality of democracy. Its score in this area has declined by 0.1 point since 2014.

Electoral policies are generally fair. Racist and fascist parties are banned. Parties receive public and private funding, with campaign-finance monitoring somewhat weak. Referendums can be held only with elected officeholders’ approval.

A deadlock over regulations mandating that media provide strictly equal air time to all parties was resolved through retraction of the rule. Creation of an ostensibly independent public-media oversight council triggered conflict with the public broadcasters’ board, which ultimately resigned. Financial pressures have meant media organizations frequently change hands.

While civil rights are constitutionally protected, the police and justice systems have been the focus of human-rights-related criticism. Gender and racial discrimination remains moderate concerns, and corruption is a persistent problem. However, courts are independent and strong.



Executive Capacity

With its post-crisis flexibility hampered by financial concerns, Portugal falls into the lower-middle ranks (rank 29) with regard to executive capacity. Its overall score on this measure has declined by 0.3 points since 2014.

Deficit-reduction imperatives continue to constrain strategic planning. While the Prime Minister’s Office (PMO) has limited policy-assessment capabilities, the Ministry of Finance’s power has substantially increased. Informal coordination mechanisms are vital.

Several new RIA instruments have been created, but implementation has lagged. Assessments thus remain unsystematic. The government routinely meets with social partners, but the tensions of austerity have made it difficult to generate public support. Communication coherence has improved.

Post-bailout economic performance has been mixed, but has been directed largely toward EU-mandated rather than domestic goals. The PMO does monitor ministries on a narrow set of mostly financial dimensions. Subnational-government administrations have accumulated substantial debt, with many requiring their own bailouts.

Executive Accountability

Burdened by the aftereffects of crisis, Portugal scores relatively poorly in international comparison (rank 34) with regard to executive accountability. Its score on this measure has declined by 0.1 point since 2014.

Parliamentarians have few official support resources, through formal oversight powers are generally strong. The audit office is a judiciary-branch body, as is the ombudsman.

Despite citizens’ crisis-driven increase in policy interest, actual policy knowledge remains uneven, undermined by insufficient government transparency, a weak civil society and an often scandal-focused media. Investigative reporting has shown an uptick in quality, but in-depth journalistic policy analysis remains rare.

Political-party decision-making styles range widely. Unions and employers’ associations can formulate relevant policies, but have acted reactively during the crisis. Other groups have also lost influence.
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