“Less bureaucracy, more transparency” is how Social Security describes the Simplification of the Contribution Cycle (SCC). Do you know what it entails?
“The Simplification of the Contribution Cycle (SCC) is a new model launched by Social Security which revolutionizes how employers report their employees’ salaries,” according to the Social Security website.
The aim, the organization explains, “is to reduce bureaucracy, ensure greater transparency, and predictability in fulfilling contribution obligations.”
What changes with the SCC?
According to the public body, the “new model reverses the process: the contribution obligation will now be automatically presented by Social Security“.
“Employers will only need to confirm, alter, or report new values on the Social Security Portal,” the released statement notes.
This initiative, Social Security explains, “is intended for all employers with associated employment bonds, including individuals (self-employed workers) with staff in charge.”
“The transition to the SCC will gradually occur between January 1 and December 31, 2026, allowing companies to adapt to the new model,” it states.
Social Security recommends consulting more information in the SCC-dedicated area under the ‘Work’ menu > ‘Salaries and Contributions’.
Government anticipates savings with Social Security fraud control
The Government expects to save 40 million euros in 2026 by strengthening control mechanisms against fraud and improper payments in Social Security and implementing the ‘People First’ program, stated the Minister of Labor.
In the initial intervention during the specialized discussion hearing of the State Budget proposal for 2026 (OE2026), the Minister of Labor, Solidarity, and Social Security indicated that the Government will “continue to strengthen control mechanisms to avoid improper Social Security payments and prevent fraud” in the system, emphasizing that this measure “together with the ‘People First’ program should allow for significant savings for the public coffers over the coming years.”
“We estimate a savings of 40 million euros in 2026 through the combination of these two measures”, clarified Rosário Palma Ramalho.
On October 24, during the hearing on the general discussion of OE2026, the minister mentioned that the implementation of this program had removed more than two million people from in-person Social Security services.
According to the minister, measures within the ‘People First’ program aimed at “significantly improving the relationship between Social Security, people, and companies” include “simplifying the declaration of salaries to Social Security,” set to advance in January next year to reduce “contextual costs for companies.”
The ‘People First’ program aims to modernize and digitize Social Security services, allowing, among other measures, payments to be made via virtual IBAN, MB Way, or app.
When questioned by the deputy and leader of the Liberal Initiative about measures to encourage savings accounts, the Minister of Labor indicated, during the first round of questions, that the “Ministry of Finance will study this matter next year,” with a view to “presenting a draft proposal potentially providing fiscal benefits for savings accounts.”
“As it is not specifically my area, I cannot say how the measure is currently modeled,” she emphasized, assuring, however, that the Government is not “unattentive” to the “very audible and recent communications” from the European Commission on this matter.
