nejcbole / Flickr
The measure is only expected to come into force in 2026 and the Government anticipates a 10% increase in costs due to the forecast rise in unemployment.
The Parliamentary Labor Committee in Portugal decided to extend the discussion on the proposal to extend parental leave until the end of January, which was initially driven by a citizens’ legislative initiative. This postponement makes less likely that the measure will come into force in 2025as the Government previously admitted.
The proposal aims to increase the period of initial parental leave from four to six months with 100% remuneration, which would require significant changes in the budget and support structure for working families.
The financial impact of the measure is a point of contention: the government initially estimated the cost at 404 million euros, a figure that was reduced by the Minister of Social Security to 230 million euros in a statement in Parliament.
A more recent analysis from the office of the Minister of Parliamentary Affairs puts the cost in a range between 228 and 404 million eurosdepending on factors such as “behavioral responses” and “second-order effects” that may occur with the extension of the license, says .
Among the Government’s arguments for the high cost of the measure is the possibility of increase in unemployment among beneficiaries of parental leave, especially among those with more precarious employment relationships. The Executive warns that a longer leave could weaken workers’ ties to the job market, even with anti-discrimination mechanisms in place.
This phenomenon, which the Government refers to as a “historical record” in Portugal and in developed countries, foresees a 10% increase in costs due to the need to provide unemployment benefits and other social benefits.
Furthermore, the Government considers that the number of beneficiaries may increase, given the encouraging license sharing between parents, which should drive additional costs associated with social support and salary maintenance during parental leave. According to Pedro Duarte’s office, these “second orders” of impact increase the total cost of the measure, as increases in benefit values and the rate of adherence to the benefit are expected.
The decision to extend the discussion deadline was justified by the complexity of the process and the high number of entities to be consulted. However, there is criticism from deputies, such as José Soeiro, from the Left Bloc, who accuses the Socialist Party (PS) and the Social Democratic Party (PSD) of obstruct the process by requesting auditions additional contributions from entities that had already expressed their opinion, in an attempt to postpone the implementation of the law beyond 2025.
The project may come into force with the Union Budget subsequent to its publication, which would indicate the beginning of 2026 as the most likely date for the measure to come to fruition. However, deputies could still suggest an earlier implementation date, for 2025, although it is not clear whether the Government would oppose such an anticipation.
