PS government's Stability Programme, presented by Finance Minister Fernando Medina, under fire: Image: Lusa

Measures presented in government stability plan not credible – experts

UTAO refers to “isolated policy measures” with “almost no effect on pockets”

Portugal’s technical budget support unit (UTAO) believes the government stability programme is not credible.

In its assessment of the 2023-2027 programme presented in parliament on Wednesday afternoon, UTAO says it “disappoints” in its “programmatic content”, in that it has “little information on policy measures” while the reduction of the tax burden promised, “efficiency gains in tax benefits” and “review of tax expenditure” cannot be considered credible. 

“Only three measures in the stability programme are new, communicated through the programme itself”, said the experts – considering that on these “nothing more is said than the direct impact targeted for the balance of each year”.

“The information in the 2023-27 stability programme (SP) on the measures “reduction of the tax burden”, “efficiency gains in tax benefits” and “review of tax expenditure” is limited to the name of the measures and the amount of the balance that the government wanted to allocate to them in the programming period,” the assessment by the technicians who support the MPs can be read.

According to the UTAO, “as presented in the SP, the three measures cannot be considered credible”.

They also state that “nothing more is known about these intentions beyond two lines in a table”, which is why they consider that “the expected direct impact figures on the balance are mere announcements without any technical support” and the finance ministry document “does not meet the minimum requirements in terms of specification required by good practice” and by the budgetary framework law.

In this sense, UTAO argues that the “‘opaqueness about policy measures’ contrasts with ‘the exuberance of political statements by government and opposition in times of announcements’ and ‘the absence of accountability and complaints about the effectiveness of the measures at the end of the financial years'”.

For UTAO, the prospective scenario for public finances included in the SP “is too close to being just a scenario of invariant policies between 2024 and 2027, given that only four measures will be implemented from next year”, out of the 48 identified by the Unit.  

According to the experts coordinated by Rui Nuno Baleiras, “an old and debatable practice in its economic merits is being continued of developing isolated policy measures with a high cost for the State and almost no effect on the pockets and behaviour of individual beneficiaries”.