Revealed: How Santa Casa da Misericórdia de Lisboa is Tackling €2 Million in Rent Payments

Insight from the New Provedor

In an exclusive interview with PÚBLICO/Renascença, Paulo Duarte de Sousa, the new Provedor of the Santa Casa da Misericórdia de Lisboa (SCML), reveals the institution's ambitious plans to address its financial challenges after nearly seven months in office since May 20, 2024.

Restructuring Plans

Duarte de Sousa disclosed that the SCML's restructuring plan involves the sale of approximately €80 million worth of assets to reinvest in rehabilitating other properties. This move aims to eliminate the burden of nearly €2 million in rent paid to third parties. The SCML's real estate assets are valued at around €1 billion, comprising both operational and income-generating properties.

Objectives of the Provedor

Duarte de Sousa highlighted several key objectives during his three-year mandate:

• Implementing a restructuring plan that ensures future sustainability, especially after years of deficits.
• Increasing revenue from social games, which currently contributes 26% to the institution's funds.

Immediate Actions Taken

He mentioned immediate actions to stabilize finances, including:

• Reducing operational costs and enhancing revenue sources.
• Negotiating early terminations of rental contracts, resulting in significant savings. For instance, the SCML previously paid €30,000 monthly in rent for unused properties, which has now been eliminated.

Future Outlook

Looking ahead, Duarte de Sousa expressed optimism about 2024 revenues, which will primarily be directed to reinforcing the institution's treasury position, aiming for a target of €100 million in net cash.

Human Resources and Cultural Changes

Regarding human resources, he emphasized the importance of retaining current employees and launching early retirement programs to address the aging workforce without resorting to layoffs. He acknowledged the need for a more diverse age profile within the organization.

Transparency and Accountability

Duarte de Sousa also addressed issues of nepotism within the SCML, stating that any conflicts of interest must be disclosed, and he is committed to ensuring a transparent work environment.

Financial Strategies

The restructuring plan anticipates generating €31 million annually from various asset sales and aims to create a virtuous cycle of divestment and reinvestment. The Provedor firmly believes that selling underperforming assets is more financially sound than accruing debt, as the current return on the asset portfolio is a mere 1.9%.

Conclusion on Rental Payments

In conclusion, Duarte de Sousa confirmed that the SCML is actively working to utilize its own properties to eliminate rental costs, ultimately aiming to reduce the €2 million in rent to nearly zero over time.