Government to assess the creation of a Disaster and Earthquake Fund

The Government will evaluate the creation of a Disaster and Earthquake Fund and plans to develop a Severe Earthquake Response Plan as part of the Portugal, Transformation, Resilience and Recovery (PTRR) initiative, announced Prime Minister Luís Montenegro on Friday, February 20. In a statement following the Council of Ministers, Montenegro outlined measures for the three pillars of the PTRR, particularly regarding seismic risk. These measures include revising and updating national legislation related to resilience and seismic reinforcement, as well as developing monitoring, transparency, and oversight solutions for the seismic resistance of buildings. The Government also aims to enhance seismic coverage of properties and create a Severe Earthquake Response Plan. According to the package presented today, the review of the Regime and Incentives for Disaster Insurance will proceed, along with adopting financial risk management solutions for disasters and earthquakes, “assessing the creation of a Disaster and Earthquake Fund, and positively differentiating more vulnerable populations, small businesses, and small farmers.” The insurance sector has been advocating for the establishment of this fund, with the president of the Insurance and Pension Funds Supervisory Authority (ASF) stating this week that it is “essential” to have an integrated national system for protection against natural disasters, not solely focused on earthquakes. Gabriel Bernardino noted during a hearing in the Budget, Finance, and Public Administration Committee that when he spoke with the Minister of Finance upon his appointment as supervisor, he said: “We need to have a disaster fund, not just an earthquake fund.” He emphasized the need for an “integrated national system for protection against natural disasters,” indicating that he hopes to present it to the Government in due course. The Government aims to have the PTRR approved in April, with the financial envelope to be defined after national consultations. The Prime Minister has already requested meetings with President Marcelo Rebelo de Sousa and elected head of state António José Seguro, in addition to scheduled meetings with parliamentary parties next Wednesday. The “small deficits” caused by the PTRR will still maintain “balanced public finances.”