Lisbon City Council's Budget Cuts Spark Controversy: Opposition Claims Broken Promises

Lisbon City Council Approves Budget Changes

On Friday, the Lisbon City Council approved changes to the municipal budget for 2025, proposed by the PSD/CDS-PP leadership. Key among these changes is a reduction in transfers to local parishes, which the opposition argues undermines previous commitments.

In a private meeting, the council approved the first budget changes for 2025, with votes against from BE and Cidadãos Por Lisboa (elected by the PS/Livre coalition), abstentions from PS, Livre, and PCP, and support from the PSD/CDS-PP leadership, which governs without an absolute majority.

According to BE, the changes to the budget “completely distort some of the promises” made by Mayor Carlos Moedas (PSD), specifically regarding the increase in transfers to parishes, with €21 million (about 40% of the total) being cut from the initial allocation of €74 million down to €52 million.

Cuts to Social Programs

The funds for the homeless have also been reduced, with an 18% cut in housing first initiatives and a 55% reduction in the Social Emergency Fund for homeless individuals. Additionally, school meals for the first cycle will see a 28% cut. BE highlighted “significant cuts” in various sectors, including drainage plans (around €5 million), sports, sewage maintenance, street repaving, and the Hub do Mar project.

In a statement, BE expressed their opposition, emphasizing their commitment to fighting for essential funding, labeling the budget cuts as “very concerning” and accusing the 2025 budget, presented in November and approved in December, of being a mere propaganda maneuver that does not reflect the actual budget figures.

Budget Overview

The municipal budget for this year anticipates an expenditure of €1.359 billion, as per the PSD/CDS-PP proposal, which was approved due to the abstention of the PS, with the rest of the opposition voting against it.

Changes to the budget were justified as necessary adjustments following the evaluation of the 2024 budget execution, aimed at ensuring proper coverage for commitments transitioning into the current budget and adjusting revenues associated with earmarked projects.

The vice president of the council, Filipe Anacoreta Correia (CDS-PP), claimed that the council has not changed its objectives nor misrepresented the budgets, accusing BE of political bad faith for allegedly distorting the data regarding the budget changes.

Ongoing Criticism

Cidadãos Por Lisboa criticized the “New Times” strategy of the coalition, arguing that it involves “approving measures in the budget that are then completely distorted week after week,” a pattern they claim has persisted through previous budgets in this term (2021-2025).

Despite abstaining to avoid blocking the PSD/CDS-PP governance, PS councilors expressed concern over the budget changes, noting that it is alarming that by January, Carlos Moedas is already abandoning key commitments for the year. They cited the administrative reform as an example, where the coalition assured there would be no underfunding but has already cut €21.5 million from local parishes.

Among the budget changes noted by PS are cuts to sewage maintenance, occurring during a critical period when heavy rains pose flood risks, and reductions in urban hygiene and street paving budgets, which total nearly €5 million.

Further budget cuts include €3.5 million in energy and wastewater treatment expenses, no allocation for green spaces, €1 million less for support to homeless individuals, €4 million cut for the Hub do Mar project, and a €5 million reduction in the General Drainage Plan for Lisbon.

The PCP raised concerns about the increases/decreases in different budget lines and stressed the importance of timely support allocations, which could jeopardize the financial health of institutions.

Response from PSD/CDS-PP

In response, the PSD/CDS-PP leadership affirmed that it has not altered its budget management objectives for the year and did not misrepresent the budgets, even amid opposition criticism. They clarified that the €21 million for the administrative reform will be funded by the General Directorate of Local Authorities (DGAL) after tax collection.

The vice president also noted that funds for homeless individuals remain “untouched,” only changing the budget line under which they were allocated. Furthermore, the funding for the Hub do Mar is fully covered by the Recovery and Resilience Plan (PRR), negating the need for personal capital allocation.

Anacoreta Correia concluded that the remaining changes are merely adjustments to commitments from the previous year.