One of the key aims of the EU project is to help the poorer members of the EU converge with the richer ones and as a result the EU has been throwing money at convergence (via the structural funds) for over 20 years or more; in most cases this has simply failied to work, as has been seen in Portugal. In 1995, Portugal’s GDP per capita was 79% of the EU average, which fell to 76% in 2018 – all this despite more than €100 billion of EU funding being poured in to Portugal. This blog has many times reflected on how poorly the majority of this money has been spent (many times on vanity projects, other times on dishonest application of funds or sometimes projects with little structural impact and just filtering through to the bottom line of the recipient companies). Whilst transferring funds from the rich north of the EU to Portugal in the poor south might help the EU bureaucracy feel good about its mission, it does not address the more fundamental problems that are holding back Portugal’s economic growth.

If EU largesse is going to continue to be lavished on Portugal (and negotiations for the next 5 years are currently under way, for another tranche of €20 billion funding) then it should not be stuffed down the same financial black holes as over the previous 34 years. Rather than picking winners (be it funding for individual companies or specific infrastructure investments), EU money should be spent on more fundamental reforms to Portuguese society designed to benefit the economy as a whole. The two areas most crying out for reform are the legal and education sectors. Here we will look at why the Portuguese education system is failing the country, but it is also worth reflecting on how broken the legal system is: a typical case going through the Portuguese courts can take over 6 years to reach resolution for example, but that is a topic for another day.

With regard to the education system, the issue is not so much funding per pupil (the lates figure is from 2014, which is €6200 per pupil, compared to an OECD average of €7370), rather it is the Kafkaesque system that governs education as a whole. Consider this: teachers are allocated to schools according to a formula which combines the mark they received at graduation from university together with the number of years of service they have had to give them a ranking against other teachers. These prospective teachers them make a list in descending order of the schools they would like to teach at and the teacher with the highest value from this formula will go to their first choice of school, until all the places are filled up from first choices. Then lower ranked teachers will have to teach at schools from lower down their list until all the teaching positions are filled. At no point is the teacher’s competence as a teacher considered, nor the preference of a particular school for local teachers or a particular skill or whatever and some schools will see over 50% of their teachers change from one year to the next! Furthermore the head of each school is elected by fellow teachers and has virtually no authority to make investment decisions (certainly not in a choice of staff) or in deciding the general path that a school should follow.


Until 2011 when Portugal went bankrupt and had to call in an international bail out, Portuguese teachers were allowed to retire at 55 on a pension worth their full final salary (and their teaching hours in their last 5 years of work were under 15 hours a week); thankfully the bailout conditions from the EU/European Central Bank/IMF “troika” forced the government to revise the conditions to something slightly more reasonable, but it is easy to see how €6200 per pupil can easily be frittered away under this sort of regime.

The end result is that the primary and secondary education system is largely set up to benefit tenured teachers already high up the ranking rather than pupils. Head teachers are not motivated or enabled to grow great schools and teachers are not motivated to become great teachers, so generally education is about attaining a series of minimum standards for teaching curriculum subjects. Schools do little more than teach maths, science, languages etc with little effort given towards teaching softer skills such as creativty, leadership, teamwork, initiative and critical thinking and as a result the potential of Portuguese children is left untapped. In this Kafkaesque model, children aim to get a good mark in their core subjects so that they can go to university and get a good mark there which in turn will give them a good ranking in the system to give them a prospect of a job at the other end (be it in teaching or other sectors of the economy that have a similar ranking system for job distribution).

A school in Portugal is little more than the sum of teachers that the ranking system has allocated to it; it is not a community with a particular mission or culture, nor is it an institution that seeks to make pupils the best they can be in all of their diversity. Schools have become learning factories to squeeze kids through the exam system. The results are rather predicatable: children who have learnt how to pass exams but do not have the soft skills that a dynamic economy demans. A priveleged few get to go to private school, where they will have more opportunities to fulfill their potential, but even in private schools the focus is generally on exams at the exclusion of the broader aims of education.

It is no surprise that the workforce that emerges at the end of the Portuguese education system it is not generally ambitious, creative, free-thinking or inspired. Rather it is timid, obedient and unmotivated ready to fit back into the sytem that gave birth to it.

Breaking the cycle of under-achievement and poverty in Portugal is not about yet another round of EU funding, it is about addressing the profound problems that made Portugal poor in the first place and this has to start with education.