Nearly 2,000 public sector jobs at risk as PRR winds down

Around 2,000 public sector workers in Portugal face an uncertain future as the country’s PRR – Plan for Recovery and Resilience approaches its final implementation deadline in August.

Unions are already warning of potential job losses across state services.

The legions of workers were hired under Portugal’s share of the European Union’s post-pandemic recovery fund – previously dubbed the “bazooka”, and involving over €22 billion.

According to estimates from FNSTFPS, the National Federation of Public and Social Workers’ Unions, many of these people stand to lose their jobs once the programme ends, despite carrying out functions regarded as permanent within public administration.

The issue is set to be debated in parliament later today, amid growing pressure on the government to clarify the future of all the people affected.

Joaquim Ribeiro, a senior FNSTFPS official, said the union rejects any scenario that would see employees dismissed while they are effectively performing essential public services.

The federation says repeated requests for talks with the government have gone unanswered. Coordinator Sebastião Santana warns that new forms of industrial action are being considered following strikes and demonstrations held in recent months.

Concerns over the issue have also been raised by the National Monitoring Commission for the PRR. In a report published in April, the body, chaired by Pedro Dominguinhos, recommended measures to ensure the retention of qualified staff recruited to implement the recovery programme – and called for mechanisms to facilitate their integration and/ or transition into permanent roles.

Impact varies across public institutions

At Portugal’s Social Security Institute, 180 employees on fixed-term contracts had their contracts extended until the end of the year after they were originally due to expire this month.

At the Institute for Housing and Urban Rehabilitation (IHRU), 74 workers remain employed under open-ended temporary contracts linked to PRR projects. Unions claim that some functions currently carried out by these workers are being transferred to consultancy firm PwC – raising concerns about the outsourcing of public services and a potential erosion of state capacity.

A source for IHRU has told Jornal de Notícias that no legal mechanism exists to automatically convert PRR contracts into permanent positions. It suggested that employment agreements will end once the services for which workers were recruited were completed.

According to other reports, employees have been informally told that the institute is preparing a recruitment drive offering between 40 and 50 permanent positions — significantly fewer than the number of workers currently employed, and open to external candidates as well.

A similar situation exists at the Central Administration of the Health System (ACSS), where 24 PRR-funded workers are awaiting decisions on their future. The agency said contract renewals or extensions depend on rules governing the original recruitment process and ultimately fall under the responsibility of the Finance Ministry.

Political parties propose different solutions

The Socialist Party (PS) wants recruitment opened for permanent positions corresponding to ongoing staffing needs, with recognition given to experience gained under the PRR.

The Portuguese Communist Party (PCP) advocates direct integration of affected workers into the public sector through permanent contracts, without open recruitment procedures.

Meanwhile, CHEGA has proposed identifying permanent functions and opening corresponding recruitment drives.

For unions, however, only full integration into the public administration will provide a lasting solution.

Unions argue that many PRR-funded employees are already carrying out indispensable work in housing, social security, healthcare and other public services, despite remaining on temporary contracts linked to a programme that is rapidly facing extinction.

Source material: Executive Digest