The Financial Burden of Reinstating Freguesias: A 30 Million Euro Annual Cost

The Financial Implications of Reinstating Freguesias

The Iniciativa Liberal (IL) has raised concerns regarding the financial implications of reinstating the 302 freguesias, recently approved by Parliament. They estimate that this decision will incur a minimum annual cost of 30 million euros.

Financial Breakdown

According to IL’s analysis, administrative costs could consume 50% to 60% of the budget allocated for the new freguesias. The estimated annual expense for a typical administrative team, which includes a president, secretary, treasurer, and an administrative staff member, is approximately 9.45 million euros.

The party highlights that the second largest cost category involves operational expenses, including ongoing costs for equipment, furniture, and building maintenance, which they estimate at about 1.68 million euros annually.

Budget Allocations

The 2025 State Budget already anticipates a 396 million euro transfer through the Freguesias Financing Fund, reflecting a 13.5% increase, or 46.6 million euros. However, IL argues that, based on a proposed 5% increase advocated by the National Association of Freguesias, the equivalent would be 29.13 million euros.

Potential Investments

IL suggests alternative uses for this funding, including:

• Education: Modernizing over 500 public schools annually at a cost of 50,000 euros each, enhancing technology and internet access.
• Healthcare: Hiring over 500 family doctors at an average cost of 50,000 euros per doctor annually, improving primary care and reducing wait times.
• Mobile Health Units: Establishing nearly 100 mobile units annually to provide basic healthcare in rural areas, with an estimated cost of 300,000 euros each.
• Housing: Renovating up to 1,000 degraded homes annually for 30,000 euros each, and subsidizing rent for 10,000 young people in urban areas at 3,000 euros per year.
• Social Transport Passes: Creating affordable transport passes for over 110,000 individuals at 250 euros each per year.
• Economic Support: Establishing funds for startups and SMEs, aiming to finance 290 innovative projects annually at 100,000 euros each, while simplifying administrative processes through technology.

Conclusion

IL argues that the 30 million euro annual cost for these new freguesias presents significant implications for the State Budget. They criticize the budget allocation model, stating that much of the funding does not directly benefit citizens but instead supports administrative structures, failing to address critical resource and access issues affecting public services in freguesias. The party emphasizes that while the desegregation of freguesias may fulfill a local identity sentiment, it represents an inefficient use of public resources that could be redirected towards essential services and projects that yield tangible improvements for the population.