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The general economic situation continues to be extremely unfavourable to families. GDP in 2003 is expected to have fallen between-1.5% and-0.75%(0.4% in 2002) 2, private consumption of Portuguese families has continued to decline (between-1.25% and-0.25%), real wages have stagnated and the unemployment rate went up to 6.3% 3 in the third quarter of 2003, from 4.1% in 2001 and 5.1% in 2002. The rate of inflation has also remained high (3.7% in 2002 and 3.3% in 2003).

Economic constraints have affected social spending and the expansion of social provision. Nevertheless, the reorganisation of social protection and the restructuring of labour legislation have been high on the agenda of the new government (coalition government between the PSD, a centre right-wing party and the CDS, the main conservative party; elected in March 2002). Three main issues have been in the forefront of public debate …