Using the OECD Social Expenditure Database and government budgets and outlays, we show the evolution of indirect social spending in Portugal since the 1980s, focusing on tax breaks for social purposes, for Education, Housing and especially Health care. We further explore its effects regarding democratic quality and equity in the provision of social rights, in matters such as income redistribution, balance between public and private welfare provision and democratic accountability of the policy-making process. Finally, the paper engages the welfare regime literature (and traditional measures for social welfare effort) by comparing the data on indirect social spending between reference countries and analysing the resulting variations and potential reorganization of the welfare state clusters. The paper concludes by drawing on different theories on welfare regimes, role of partisan orientations and of potential veto points in order to help explain the empirical patterns.
The focus on TBSPs as part of the 'hidden welfare state', an under-researched topic in the Portuguese and international literature, aims to contribute innovatively to the scholarship on the Portuguese welfare state and to that on welfare regimes in the long historical arc of 'permanent austerity'.