Portugal's Government Approves 'Single Social Benefit' Merging 13 Welfare Payments, Tying Aid to Mandatory Community Work

The Portuguese government, led by Prime Minister Luís Montenegro, approved a sweeping reform of the non-contributory social benefits system during a Council of Ministers meeting on Friday. The centerpiece is the creation of the Prestação Social Única (PSU), or Single Social Benefit, which consolidates 13 separate welfare payments into one streamlined mechanism. The government argues the reform is necessary to simplify a fragmented and antiquated system, combat fraud and abuse, and incentivize a return to the workforce.

The 13 consolidated benefits

The PSU merges a wide range of existing supports, including the social old-age pension, special disability social pension, widow's pension, orphan's pension, extraordinary solidarity supplement, social unemployment benefit, the Rendimento Social de Inserção (RSI), and several social subsidies related to clinical risk during pregnancy, termination of pregnancy, adoption, initial parental leave, and specific risks. The reform was fast-tracked partly to avoid losing €500 million from the Recovery and Resilience Plan (PRR).

The Government decided today to aggregate 13 social solidarity benefits into a Single Social Benefit, simplifying people's relationship with the State, moralizing the provision of solidarity support to those who effectively need it.

The mandatory work requirement

A key and controversial innovation is the introduction of a mandatory 'social solidarity activity' for working-age beneficiaries who are not employed. Recipients can be required to perform up to 15 hours of community work per week for public entities, social economy organizations, or civil protection structures. Failure to comply will result in the loss of the benefit. The Minister of Labour, Solidarity and Social Security, Maria do Rosário Palma Ramalho, suggested tasks could range from assisting at a municipal council event or festival to participating in clean-up actions or other community interest initiatives. This obligation does not apply to pensioners, people with disabilities preventing work, students, or informal caregivers.

It could be support in a municipal council activity, at a festival, in a clean-up action or in other community interest initiatives.

Political reactions and the fight against fraud

Prime Minister Montenegro, speaking at the 850th anniversary of mutualism in Vila Nova de Gaia, framed the reform as a moralization of the system, explicitly targeting fraud and abuse to ensure resources reach the genuinely needy. He was met by around 30 protesters contesting the government's broader labor package. The opposition Chega party, through its leader André Ventura, welcomed the work requirement, claiming it as a long-standing Chega proposal, but urged the government to go further by implementing a formal 'program-contract' similar to models in Sweden and Germany, where beneficiaries return a portion of aid to the state.

I salute them for taking up an initiative that is Chega's, a proposal that is Chega's and that we have always assumed, since the party's founding, as ours: that those who receive minimum subsidies have to work.

Expert concerns over adequacy

Despite the government's assurances that no current beneficiary will be worse off, experts have raised concerns about the benefit's adequacy. Carlos Farinha Rodrigues, a professor at ISEG, noted that the RSI—which serves as the reference value for the new PSU—has systematically lost value relative to the poverty line in recent years. He warned that the most disadvantaged families could end up receiving less under the consolidated system if the new benefit does not correct this erosion. The current social old-age pension, for example, ranges between €285 and €308 per month.

If we consider the relationship between the RSI value and the poverty line value, clearly that value has been declining in recent years and it would be expected to have a Single Social Benefit with increased generosity.

Next steps

The proposal for legislative authorization was approved and will now be sent to Parliament, with the government aiming for it to be debated in the current legislative session. The measure targets individuals aged 18 or over in severe economic need residing in Portugal, with a minimum one-year residency requirement for non-EU citizens. The government insists the reform ensures that no one returning to work will earn less than they received solely from state support, aiming to dismantle the 'poverty trap.'