The Court of Auditors (TdC) has uncovered multiple irregularities in the distribution of rent support, including the payment of subsidies to 32 beneficiaries who are not residents of Portugal.
Court of Auditors Identifies Irregularities in Portugal's Rent Support Program
The Court of Auditors' findings on the 2023 General State Account (CGE), submitted to parliament, reveal several irregularities in Portugal's rent support program. The program, launched in 2023 to mitigate rising housing costs, shows risks that could impact the accuracy of allocation, calculation, and payment.
Public Expenditure and Beneficiaries in Portugal
The report highlights that in 2023, rent support reached 258,661 beneficiaries, with public expenditure amounting to 350 million euros. The average annual support per beneficiary was around 1,351 euros.
Irregularities in Rent Support Allocation
During the analysis, several non-conformities were identified. Among these, it was found that support payments were made to 32 beneficiaries who were not residents in Portugal, along with 2,867 non-habitual residents who also benefited from the program.
Other Issues Detected
The report further identified 35,229 beneficiaries who were granted rent support but did not receive payments and noted that payments for December 2023 had not been issued.
Eligibility Criteria and Support Details
The rent support, capped at 200 euros per month, is available for rental contracts registered before March 15, 2023. It is intended for families with a rent effort rate exceeding 35%, and one of the key conditions is that beneficiaries must be tax residents in Portugal.
Risks in the Operationalization of Portugal's Rent Support
Despite legislative improvements to the rent support scheme, the Court of Auditors (TdC) has identified several risks in its implementation. One key issue is that the universe of beneficiaries is defined annually, without updates to account for changes in information. This could result in continued payments to individuals who no longer qualify or the exclusion of new eligible cases that emerge later.
Weaknesses in Assessing Financial Situations
The TdC also highlighted weaknesses in using the annual IRS declaration to assess tenants' effort rates. The time lag between the IRS declaration and changes in tenants' financial situations could mean that the support no longer reflects their current needs. Furthermore, using the rent value declared at the time of contract registration introduces inaccuracies, especially for older contracts, as it does not account for rent increases that may have occurred.
Although beneficiaries can update their information, the initial calculation is often based on outdated data. A more accurate source, such as rent receipts issued by landlords, could provide a better reflection of current rental costs.
Issues with Household Information and Informal Housing Sharing
Another concern raised by the TdC is the declarative nature of household information, which is not subject to specific validation. There is no mechanism to control situations of informal housing sharing. To address this, the report suggests validating household information by identifying all individuals with tax residence at the property in question, even if they are not listed on the rental contract.
Distribution of Rent Support in Portugal
The analysis also revealed that 25.1% of beneficiaries received the maximum rent support of 200 euros per month, while 20.8% received between 110 and 200 euros. Another 17.5% received between 80 and 110 euros, 13.1% between 50 and 80 euros, and the remaining beneficiaries received less than 50 euros per month.
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