Decree-Law No. 166/2026 has been published, creating the new Single Social Benefit (PSU) and carrying out a significant reorganization of the non-contributory social benefits system.
The main change consists of integrating 13 social benefits currently subject to separate regimes into a single benefit, with common rules for access, calculation, monitoring, and enforcement.
The new regime takes effect on December 31, 2026.
In summary
With the creation of the PSU:
- 13 social benefits are integrated into a single regime;
- several rules on income, assets, and household composition are standardized;
- the benefit amount now depends on the household’s specific economic situation;
- a mechanism is created to prevent an abrupt loss of the benefit when the beneficiary starts working;
- increases may apply in cases of unemployment and parenthood;
- working-age beneficiaries are subject to stronger obligations regarding job search, training, and insertion;
- social solidarity activities may be required;
- monitoring and enforcement mechanisms are strengthened;
- failure to comply with certain obligations may result in suspension or loss of the benefit;
- transitional rules are established for current beneficiaries.
The reform therefore seeks to combine the simplification of social support with a stronger link between social protection, employment, and economic autonomy.
Which benefits will be merged into the PSU?
The new benefit incorporates 13 benefits from the solidarity subsystem, including:
- the Social Insertion Income;
- the unemployment social benefit;
- the old-age social pension;
- the special disability social pension;
- the widowhood pension;
- the orphanhood pension;
- the extraordinary solidarity supplement;
- the social benefit for clinical risk during pregnancy;
- the social benefit for pregnancy termination;
- the initial parental social benefit;
- the adoption social benefit;
- the social benefit associated with the need to travel off-island for childbirth;
- the social benefit for specific risks.
This is not, therefore, the creation of an additional benefit to be added on top of existing ones.
The legislative choice was to consolidate several benefits, which currently follow different rules, into a single regime.
How will the Single Social Benefit be calculated?
The PSU is a monthly benefit whose amount varies according to the composition and income of the household.
The PSU’s reference value corresponds to 50% of the IAS (Social Support Index).
To determine the base amount, a household weighting is applied:
- 1 for the applicant;
- 0.7 for each additional adult;
- 0.5 for each minor.
The overall amount is then determined after taking into account the income of the applicant and other household members.
For this purpose, the following are considered, among others: income from employed and self-employed work, capital income, rental income, pensions, social benefits, and certain housing support.
Limits are also established regarding the assets of the applicant and their household.
Does starting work mean losing the benefit?
One of the most significant changes is specifically designed to prevent this from happening immediately.
The new regime creates a work incentive component, intended to allow the benefit amount to be reduced progressively as professional income increases.
In calculating this component, the following are considered:
- the full amount of work income up to a limit of 20% of the IAS;
- and 50% of the portion of that income exceeding that limit.
The aim is to avoid situations in which starting a professional activity or increasing income leads to an abrupt loss of support and, consequently, a disincentive to returning to the labor market.
Increases for unemployment and parenthood
The PSU amount may also be increased through specific supplements, particularly in cases of unemployment or parenthood.
The unemployment supplement is intended, under certain conditions, for beneficiaries who are involuntarily unemployed without entitlement to the unemployment benefit, or who have already exhausted the respective period of entitlement.
The supplement is granted during the first six months of the PSU, provided the conditions set out in the new regime are met.
More obligations for working-age beneficiaries
The simplification of the system is accompanied by a significant strengthening of obligations for working-age beneficiaries.
When not working and not covered by an exemption, the applicant or beneficiary must, in principle:
- be registered with an employment center;
- be available to accept suitable employment;
- be available for vocational training;
- demonstrate active job search;
- comply with the individual insertion plan;
- be available to participate in social solidarity activities.
The specific set of applicable obligations will be defined taking into account the situation of the beneficiary and their household.
What are social solidarity activities?
These are temporary activities carried out for the benefit of public entities, non-profit entities, social economy entities, or civil protection.
These activities are unpaid and must be compatible with the beneficiary’s skills and qualifications.
As a rule, their duration may not exceed 15 hours per week.
For working-age beneficiaries who remain on the PSU for longer periods, the limit may rise to 20 hours per week from the third renewal onward, under terms to be further regulated.
However, exemptions exist, particularly in certain cases of incapacity, disability, school attendance, or when the person is a primary informal caregiver.
Non-compliance can lead to loss of the benefit
The new regime provides for significant consequences for failure to comply with obligations associated with the PSU.
Unjustified refusal of work, suitable employment, vocational training, or social solidarity activities may result in the PSU not being granted to the holder for 24 months.
When non-compliance is committed by another household member, the period is generally 12 months.
Making false statements or certain failures to comply with information duties may also result in suspension, termination, or temporary inability to access the benefit.
Greater access to information and enforcement
Granting the PSU also depends on authorization from the applicant and household members for the managing entity to access relevant information for verifying eligibility conditions, including tax and banking information.
Monitoring and enforcement of the new regime will be carried out through coordination between Social Security, municipalities, local insertion units, the IEFP (employment institute), and other public and social entities.
There is, therefore, both a standardization of access conditions and a strengthening of mechanisms to verify that those conditions continue to be met.
What about current recipients?
The decree establishes a transitional regime designed to safeguard current beneficiaries.
For example:
- current RSI (Social Insertion Income) holders are automatically transferred to the PSU, keeping the amount they currently receive for the duration of the ongoing award period;
- certain other benefits are likewise automatically converted, with mechanisms to safeguard the amount received;
- certain supplements continue to be granted;
- current holders of unemployment and parental social benefits continue to receive them until the end of their respective award period.
The decree itself establishes as a principle that the transition to the PSU should not result in a reduction of the level of social protection beneficiaries already have.
When does it take effect?
Decree-Law No. 166/2026 was published in August 2026.
Although it formally enters into force on the first business day following publication, the decree establishes that it takes effect on December 31, 2026.
Some aspects of implementing the new regime will still need to be defined through further regulation.
Why is this a significant change?
The creation of the PSU is not simply a renaming of social benefits.
The system moves from several separate benefits, subject to different regimes, to a model in which the beneficiary’s economic and family situation is assessed in a more integrated way.
At the same time, the link between social protection and the labor market is strengthened.
The reform seeks to prevent a return to work from causing an immediate loss of support, while at the same time introducing more demanding obligations regarding job search, training, social insertion, and cooperation with the entities responsible for monitoring.
Frequently Asked Questions
Do all Social Security benefits become part of the PSU?
No. The reform integrates into the PSU a specific set of non-contributory benefits; this does not mean that all benefits granted by Social Security fall under this regime.
Do current RSI recipients need to submit a new application?
Not for the purposes of the initial conversion. Current RSI holders are transferred to the PSU automatically, with the amount they are currently receiving safeguarded for the duration of their ongoing award period.
Is it possible to receive the PSU and work at the same time?
Yes. The regime itself includes a work incentive component designed to allow the benefit to be combined with professional income, progressively adjusting its amount.
Can beneficiaries be required to carry out social solidarity activities?
Yes, when the conditions set out in the decree are met. As a rule, these activities may reach 15 hours per week, with exemptions and specific rules for beneficiaries who remain on the benefit for longer periods.
Is the PSU already being paid?
No. The new regime takes effect on December 31, 2026.
How we can help
URB Law Services provides legal support in Social Security and social protection matters, namely in:
- reviewing eligibility conditions for social benefits;
- assessing Social Security decisions;
- complaints and appeals against decisions of denial, suspension, or termination of benefits;
- reviewing beneficiaries’ rights and obligations;
- support with cases related to unemployment, disability, and other social protection situations.
With an office in Almancil, in the Algarve, and representation in Lisbon, URB Law Services provides legal support to domestic and foreign clients on matters related to Portuguese Social Security.
The creation of the Single Social Benefit represents a structural change to the non-contributory social protection system and will make it particularly important to assess, on a case-by-case basis, income, assets, household composition, and the obligations applicable to each beneficiary.
Contact us to learn more.
