Representatives of the Casas do Povo say outdated funding agreements and rising operating costs threaten essential social services across the nine islands, calling for urgent reforms and greater financial responsibility from Lisbon.
Social welfare institutions across the Azores are warning that chronic underfunding and rising operating expenses are threatening their ability to maintain essential community services, prompting the region’s Casas do Povo (People’s Houses) to demand a comprehensive revision of the public financing system. Representatives of the institutions have presented a strategic policy document to the Azorean Regional Government, arguing that existing cooperation agreements no longer reflect the actual costs of providing social assistance, childcare, and other services to vulnerable populations throughout the archipelago.
The initiative was announced by the organizing committee of the Azorean branch of the Portuguese Confederation of Casas do Povo, led by Jaime Rita, president of the Casa do Povo da Maia. The committee delivered a strategic charter to the Regional Secretary for Health and Social Security, outlining proposals intended to strengthen the financial sustainability of the social economy and establish a more predictable relationship between public authorities and community institutions.
Speaking at a press conference, Durval Santos, president of the Casa do Povo de Santa Bárbara and principal author of the document, described the financial situation as increasingly unsustainable. He explained that institutions are being forced to absorb the difference between the standardized payments established in government cooperation agreements and the actual costs of providing services, including salaries, food, electricity, transportation, and building maintenance.
That growing financial gap, Santos warned, is placing enormous pressure on organizations whose work depends on public funding, community involvement, and the dedication of their leadership. He described the situation as a form of financial suffocation, arguing that the existing system must be fundamentally reconsidered if the institutions are to continue fulfilling their responsibilities.
A central concern is the age of the region’s regulatory framework. Santos noted that the Azorean Social Action Code, known as CASA, has not undergone a comprehensive revision since 2014, despite substantial changes in operating expenses, labor costs, and the economic environment. He characterized the current system as outdated and increasingly dependent on the resourcefulness, voluntary commitment, and management abilities of social-sector leaders rather than on a sustainable financial structure.
The warnings follow the presentation of a study commissioned by the Azorean Social Action Institute (ISSA), which examined the actual costs of social services provided by Private Social Solidarity Institutions (IPSS). According to the findings discussed by regional officials, the costs of delivering these services exceed the standardized amounts established in cooperation agreements and, in some categories, are higher than those recorded in mainland Portugal.
Carlos Estrela, president of the Casa do Povo de Rabo de Peixe, argued that the study confirms what institutions have been reporting for years: public financing is insufficient across much of the social sector. He called for the findings to become the basis for concrete negotiations and policy decisions, rather than another diagnosis without practical consequences.
Estrela also criticized what he described as the Portuguese national government’s tendency to transfer responsibilities to the Autonomous Region without ensuring adequate financial support. In his view, Lisbon must assume a greater share of the obligations associated with social welfare provision in the islands, particularly given the additional costs imposed by geographical isolation and the distribution of services across nine islands.
One of the more sensitive proposals concerns the future of universally free childcare. Estrela suggested that the sustainability of the current model should be examined as part of a broader discussion involving government authorities, institutions, and families. He argued that the provision of free daycare services cannot be separated from the financial resources required to maintain them.
“Continuing to speak of completely free daycare centers may not be a scenario for the future,” he warned, emphasizing that services generate real costs that must be covered if institutions are to pay employees and suppliers. His remarks raise questions about how to balance universal access, family contributions, and the financial viability of organizations responsible for delivering childcare.
The debate also has a political dimension. The Azorean Socialist Party has requested clarification from the Regional Government regarding the final report of the cost assessment study, expressing doubts about aspects of its methodology. Santos responded sharply, arguing that questioning the reliability of the information supplied by participating institutions amounted to questioning the credibility of social-sector leaders themselves.
According to Santos, the data provided for the study reflected the institutions’ actual operating conditions and financial obligations. He urged political representatives to consider the implications of their statements before casting doubt on the accuracy or consistency of the information collected.
Beyond the immediate funding shortfall, the Casas do Povo are calling for structural changes to the way government payments are calculated and distributed. Among their principal demands are regular and timely transfers, together with an automatic annual adjustment of cooperation agreements to reflect changes in operating costs, particularly increases in the statutory minimum wage.
Santos argued that when the minimum wage rises, the financial contribution established in government agreements should increase accordingly. Without such adjustments, institutions face growing payroll obligations while receiving funding based on outdated cost assumptions, creating recurring financial imbalances that cannot be resolved through administrative efficiency alone.
The representatives are also seeking a special funding adjustment for the Azores in recognition of the archipelago’s insular and outermost-region status. They maintain that the additional costs associated with transportation, energy, logistics, and geographical fragmentation justify a differentiated approach from the Portuguese national government.
To strengthen awareness of these conditions, the Portuguese Confederation of Casas do Povo has invited the national Minister responsible for the sector and the relevant Secretary of State to visit the Azores and observe the work performed by community institutions. The representatives believe that direct contact with the realities of service provision in the islands would help national policymakers better understand the financial and operational challenges involved.
Another proposal calls for the Regional Government to provide a financial assurance mechanism, described as a “letter of comfort,” that would allow institutions to obtain temporary bank financing when delays in national government transfers jeopardize their ability to meet payroll and supplier obligations. The measure is intended to provide short-term financial stability without interrupting essential services.
The strategic charter also recommends the preparation of a White Paper on the Azorean social economy, establishing a comprehensive technical and policy framework for future decisions. In addition, the institutions propose creating a Regional Social Economy Observatory to collect and publish regular information, monitor financial and operational conditions, and develop recommendations to support public policy.
These proposals reflect an effort to move the debate beyond annual funding negotiations toward a more transparent and evidence-based system of social-sector governance. The representatives argue that reliable financial information, clear institutional responsibilities, and predictable public support are necessary to ensure that social welfare organizations can plan their activities and maintain the quality of their services.
The scale of the issue is considerable. Of the 112 Casas do Povo operating throughout the Azores, 80 provide social services, making these institutions an important component of the region’s community support network. Their activities are particularly significant in smaller communities, where local organizations often provide services that would otherwise be difficult to maintain.
The Azorean Regional Secretary responsible for Social Security has already acknowledged the need to revise the current financing model. Earlier this month, following the presentation of the ISSA study, the government recognized that actual service costs exceed the reference amounts established in cooperation agreements, lending additional urgency to discussions about how public support should be calculated.
The organizing committee expects to meet with the Regional Secretary following the election of the Azorean branch’s leadership, scheduled for December 5. The representatives hope that the new organizational structure will strengthen their capacity to negotiate with regional and national authorities and advance the proposals contained in the strategic charter.
The dispute highlights a broader challenge facing the Azores: how to sustain an extensive network of community-based social services amid rising costs, demographic changes, and the financial limitations of an island economy. The Casas do Povo have historically played an important role in local solidarity, combining public support with community participation and voluntary leadership.
Their representatives now argue that this tradition of service cannot continue to compensate indefinitely for structural funding deficiencies. As discussions proceed, the central question will be whether the Regional Government and national authorities can establish a financing system that reflects the real cost of social protection while preserving accessibility, institutional stability, and the essential services on which many Azorean families depend.
Based on reporting published by Diário Insular, November 10, 2026. The photo is also from DI.