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BUDGETARY BOMB
Portugal’s universities are almost bankrupt, and the health system is understaffed and under-resourced. The state body that runs the railways estimates that 60 percent of its infrastructure is in bad or mediocre condition. Social housing is just 2 percent of the housing stock. “A framework law on housing is currently being debated in parliament, but we already know how it will go,” said Rita Silva of Habita, a housing rights association. “Despite a few positive steps, there is no political will to invest public money in housing. And António Costa has already stated that this law should not challenge the deregulation of the housing market.”
The recent teachers’ strike is symptomatic of the tension between budgetary discipline and social policy. Teachers wanted to benefit from the recovering economy and have their pensions unfrozen after nine years of austerity. But on May 5, the prime minister called parliament’s approval of this a “budgetary bomb” that would destabilize public accounts and harm Portugal’s international credibility. After Costa’s government threatened to resign if the full pension increases were approved, the teachers secured only a partial adjustment, spread over two years and nine months.
“The country is still hampered by this desire to satisfy Brussels’s demands,” said José Reis, an economist at the University of Coimbra and coordinator of the Observatory on Crises and Alternatives. “There’s been a battle to increase low incomes within the EU budget framework, but overall, wages have not returned to pre-crisis levels. This is because growth is partly dependent on precarious, low-wage work.”
The dramatic reduction of unemployment hides greater reliance on low-skill, low-wage jobs. Studies suggest that half of all new jobs are now fixed-term contracts. Since the troika’s intervention, more jobs are unsecured: 73,000 more than in 2011. Half of all overtime in 2018 was unpaid. The young are the worst-affected; 65 percent are on temporary contracts, 10 percent more than a decade ago. “We’ve made little progress on employment legislation. In fact, we’ve gone backwards,” said Gusmão. “With the support of the right and the bosses, the government has endorsed the spread of precarious, ultra-short-term contracts, which used to be confined to the tourist sector. What the geringonça has done for wage increases has been undermined by making the workforce insecure.”
Portugal’s industrial ports are a major part of the economy; between 2009 and 2018 exports rose from 27 percent to 43 percent of GDP, a remarkable increase. But their competitiveness relies on exploiting a flexible workforce and slashing wages. “In early 2013, the government passed a law deregulating port activity, which was intended to make our working conditions less secure,” said António Mariano, head of the dock workers’ union (the Sindicato dos Estivadores e da Actividade Logística, SEAL). “That led to a huge increase in subcontracting.”
In August 2018 SEAL launched a strike in solidarity with port workers in Setúbal, 30 miles away from Lisbon, where 90 percent of dockers and logistics workers are on daily contracts. “These precarious workers get no holidays and no social protection if they’re ill or have an accident at work. Some may even be contracted and dismissed twice in a single day so as to do a 16-hour shift,” said Mariano. Setúbal is a key port for AutoEuropa, a Volkswagen group plant producing 100,000 cars a year, and for the Portuguese-owned global paper giant, the Navigator Company.
“The Costa government tried to tell our movement against extreme job insecurity that it was a private-sector matter,” Mariano said. “On November 22, with the port paralyzed, the government sent in the police to break the pickets so that a shipment of cars from AutoEuropa could be loaded.” The minister of the sea, Socialist Ana Paula Vitorino, was more concerned about Volkswagens being exported than dockers’ working conditions.
In 2018 the SEAL battle ended when the Setúbal workers secured the right to collective bargaining. “But the 2013 law on port workers is still in force, despite it being raised repeatedly with the minister of the sea and parliamentary commissions that have looked at employment legislation. Today in most of this country’s ports, 25 to 50 percent of workers are underpaid and on daily contracts,” said Mariano. “The government is trying to increase productivity by breaking workers’ power to negotiate.”
Pedrógão Grande, a small town 125 miles north of Lisbon, is reached by roads that wind through a vast, desolate landscape. Forest fires there in June 2017 caused 66 deaths and reduced 30,000 hectares to ash. Most victims died trying to flee the fire on a main road that the authorities failed to close in time. The tragedy caused anger nationwide: Many felt that the effects of the fire, the worst in the country’s history, had been exacerbated because of a lack of personnel and resources. Most of Portugal’s firefighters are poorly trained volunteers and the emergency services communication system (Siresp) was a public-private partnership, considered unfit for purpose for a decade.
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