Portimão council today announced it has approved the winding up of the municipal company Portimão Urbis and now has 15 days to submit plans on the fate of the remaining 111 company employees.
The proposal for the dissolution of Portimão Urbis was presented by the president of the municipality, Isilda Gomes, and approved unanimously on Thursday at a meeting of the Chamber.
No reason was given as to why the closure of the loss-making compoany has taken a year since Gomes took office, even her final announcement in July seemes to have been delayed for a further three months.
In a statement today, the council said that the president "was responsible for preparing the design of dissolution, liquidation and adsorption of staff in a plan to be submitted within 15 days for further deliberation by the House and the Municipal Assembly.”
"Notwithstanding this decision the Board found a compelling case for the the preservation and protection of company assets with a view to continuing activities ... as well as the recovery of the city's reputation with lenders," reads the document thus further confusing employees, ratepayers and the general public.
In July this year the mayor said that the decision to close the municipal company was being "balanced with the awareness that the lives of the employees of the company will be affected," aware as we all are that when companies close, workers get laid off.
The decision to abolish the municipal company resulted from an analysis performed over several months and concluded that "the risks to the municipality in keeping the company in business does not satisfactorily compensated for the costs associated with the operation of Portimao Urbis." - ‘Hemorrhaging cash,’ would be an equally accurate explanation.
"Within the dissolution, the skills, the company equipment and remaining liabilities will be transferred to the municipality as the sole shareholder."
According to the municipality, trying in desperation to claim it is working in behalf of ratepayers, "during the term of the current board of directors the company had a payroll of around €3.7 million a year which reduced to €2.1 million as the number of employees fell from 156 to the current 117."
This looks to be a decisive start to cutting staff but in fact the reduction in headcount was by the council itself taking on the employees.
Portimão council is one of the most indebted in the country, mainly due to the fiscally insane regime of the previous mayor Manuel da Luz who left the council €130 million in debt after a Imelda Marcos inspired spending spree or self-delusion and self-interest.
The council has tried, but not very hard, to access the Support Program for Local Economy so as to borrow money on a long term basis and pay off short term debts.
Portimão may now be able to access money from the Fund for Municipal Support but regarding Portimao Urbis, the closure is long overdue and the ratepayers would like to know how much debt has been transferred from Urbis to the council’s balance sheet.
