Economic and Social Council Tells MPs Pensioners Need Lasting Rises Rather Than One-Off Bonuses, and That a 3.88 Percent IRS Bracket Update Is Too Small

The Conselho Económico e Social (CES, the Economic and Social Council) has told parliament that pensioners should get lasting, predictable increases rather than one-off bonuses, and that the 3.88 percent update to the IRS income tax brackets in the 2027 State Budget is not enough to stop a 4.5 percent pay rise being eaten up by tax. The opinion was approved by the CES plenary on 3 November and presented to MPs on Thursday, 5 November.

The CES is the constitutional body where the government, unions, employers and other civil society groups give their views on economic and social policy. Parliament's budget committee asked it for this opinion on 8 October. The opinion is advisory: MPs are not bound by it.

Pensions: rises that stay, not bonuses that do not

The council says "structural and predictable increases should be favoured" and that purchasing power should be judged by what the same pensioners receive over a full year, extraordinary payments included. It notes that the budget sets aside no new extraordinary pension supplement for 2027, against 354.5 million euros in the estimate for 2026. This year's December supplement, worth 100 to 200 euros for pensions up to 1,611.39 euros a month according to ECO, is a single payment that does not raise the monthly pension (details here).

It also stresses that the Complemento Solidário para Idosos (CSI, the means-tested supplement for older people), whose reference value rises from 670 to 720 euros, is not a general minimum pension or a flat 720 euros for everyone.

Tax: a pay rise could cost more than it should

"Updating the brackets by 3.88 percent does not ensure the tax neutrality of pay rises of around 4.5 percent," the opinion's rapporteur, Tiago Abalroado, told MPs, according to ECO. The 4.5 percent is the pay reference in the tripartite agreement. The government argues that its full package of IRS changes keeps rises up to that level neutral.

Housing: a list of empty public buildings by March

The housing programme gets 2,003 million euros, 6 percent less than in the 2026 budget. The CES recommends that the list of all vacant and abandoned public urban buildings be published in the first quarter of 2027 on the websites of the Instituto da Habitação e da Reabilitação Urbana (IHRU, the state housing institute) and ESTAMO, the state property company, with the year each fell out of use. It also asks that rent rises and non-renewals that put older people, people with disabilities, survivors of domestic violence or low-income households at risk of losing their homes be prevented.

It points out that the higher rent deduction cap of 1,000 euros from 2027 only helps tenants who pay enough IRS to use it. At the hearing, CES president Luís Pais Antunes said Portugal has "a significant deficit of public construction", according to Dinheiro Vivo, and that the council will issue a separate opinion on housing policy next year. The budget's cut in housing investment is set out in our 26 October report.

Health, immigrants and what comes next

The council repeats its call for family doctor targets for each Unidade Local de Saúde (ULS, local health unit). It asks that the Agência para a Integração, Migrações e Asilo (AIMA, the immigration agency) give priority to residence cases of women who are victims of domestic violence, and that immigrant recruitment be matched to workers' skills.

Parties have until 6 November to table amendments, and the final vote on the budget is set for 24 November. The full opinion, in Portuguese, is on the CES website.