Background information

The Government approved a set of exceptional measures to support family income, with a view to mitigating the effects of inflation and the consequent increase in prices: the 'Families First' package of measures. The measure was discussed under the scope of the Medium-Term Agreement for Improving Income, Wages and Competitiveness .

The limitation of the of the increase of the rents for 2023 was established by Article 2, no. 2 of Law 19/2022 of 21 October, to be in force in the calendar year of 2023.

Content of measure

To mitigate the increase of the rents borne by residential and commercial tenants in rural and urban properties, the increase is limited to 2%. Without this measure, prices could rise by 5.43% in 2023. All tenants of rented accommodation with contracts concluded until December 2022 will benefit from this measure. Landlords will be compensated through the creation of an Extraordinary support to renting , through the attribution of a tax benefit on property income. The measure has an estimated cost of €45 million. This limitation on the increase of rents will apply from 1 January 2023, as the contracts are renewed.

Use of measure

Unknown.

Target groups

Workers	Businesses	Citizens
Does not apply to workers	Does not apply to businesses	Other groups of citizens

Actors and funding

Actors	Funding
National government Social partners jointly	No special funding required

Social partners

Social partners' role in designing the measure and form of involvement:

	Trade unions	Employers' organisations
Role	Agreed (outcome) incl. social partner initiative	Agreed (outcome) incl. social partner initiative
Form	Consultation through tripartite or bipartite social dialogue bodies	Consultation through tripartite or bipartite social dialogue bodies

Social partners' role in the implementation, monitoring and assessment phase:

• Social partners jointly
• Main level of involvement: Peak or cross-sectoral level

Involvement

The measure was discussed under the scope of the Medium-Term Agreement for improving Income, Wages and Competitiveness.

Social partners´ involvement took place in the context of the tripartite Permanent Commission of Social Concertation (CPCS), which includes: government representatives; representatives of employer confederations, i.e., the Entrepreneurial Confederation of Portugal (CIP), the Confederation of Commerce and Services of Portugal (CCP), the Confederation of Farmers of Portugal (CAP), and the Confederation of Portuguese Tourism (CTP); and the representatives of trade union confederations, i.e., the General Confederation of Portuguese Workers (CGTP) and the General Union of Workers (UGT). Their involvement was requested by institutional setting by the initiative of the government. CGTP, the largest trade union confederation did not sign the tripartite agreement, but participated in its discussion at the CPCS rounds.

The agreement shall be compulsorily subject to regular evaluation and appropriate readjustment by its signatories at the CPCS:

1. During its validity, annually, at the time of the parliamentary presentation of the State Budget Proposal (taking into account not only the framework and solutions contained therein, but also the framework and guidelines of the Stability Programme);
2. Whenever there is a substantial change in the underlying economic and social conditions.

Views and reactions

While all the employer confederations (CAP, CCP, CIP and CTP) and the trade union confederation UGT signed the tripartite agreement, CGTP did not sign it, questioning some of the measures foreseen.

Namely, CGTP considers that the Families First package of measures presented by the government do not guarantee the necessary response to the growing difficulties of workers and their families. The "price increase response plan" does not solve the day-to-day difficulties that workers and pensioners are facing.

UGT also expressed some criticism. Families First is an essential and welcome package of measures, even if it can only be considered late and clearly insufficient, something that is all the more evident when we analyse the sets of measures that were gradually taken by other countries, which were earlier and more intense in their intervention.

Sources

• 06 September 2022: CGTP's reaction to Families First Package (www.cgtp.pt)
• 07 September 2022: UGT's reaction to Families First Package (www.ugt.pt)
• 08 September 2022: Families First - Portuguese Government Q&A (www.portugal.gov.pt)
• 09 October 2022: Acordo de Médio Prazo de Melhoria dos Rendimentos dos Salários e da Competitividade (ces.pt)
• 10 October 2022: Posição da CGTP - Acordo de Médio Prazo de Melhoria dos Rendimentos, dos Salários e da Competitividade (www.cgtp.pt)
• 21 October 2022: Law 19/2022 of 21 October https://dre.pt/dre/detalhe/lei/19-2022-202455960 (dre.pt)