Higher education plays a more prominent role in OECD member and partner countries today than it did a half-century ago. It educates many more learners and is increasingly expected to make key contributions to innovation, economic development and lifelong learning. As the scope of higher education activities has increased – and societal expectations have grown – policy makers and institutional leaders have faced significant challenges in deciding how best to mobilise, allocate and deploy resources in higher education in ways that are both effective and efficient. Large exogenous shocks to economies and public budgets – such as the coronavirus (COVID-19) pandemic – make appropriate choices about how to invest in higher education all the more crucial.

Enrolment in higher education in Portugal reached its highest ever level in 2020/21, when almost 412 000 students were enrolled in one of the country’s 106 higher education institutions (HEIs). Over 80% of these students were enrolled in public universities and polytechnics, with just over 50% in public university programmes and around 30% in public polytechnic programmes. The higher education attainment rate among those aged between 30 and 34 in Portugal increased by 16 percentage points between 2012 and 2021 – from just under 28% to almost 44% – and is now above the average of the 27 European Union (EU) member states. Recent higher education graduates in Portugal are more likely to be employed and earn, on average, around 50% more than their peers without tertiary qualifications. Whileemployment in knowledge-intensive services and high-technology manufacturing in Portugal is lower than in many other OECD countries, employment in skills-intensive sectors is forecast to grow strongly in the coming decade.

This chapter synthesises key policy issues and recommendations identified by the OECD review team in the three main areas covered by the review: the core public funding model for higher education institutions in Portugal, the strategic steering and funding of future development of the public higher education system and the resourcing of policies to support widened access to higher education.

This chapter provides a broad overview of the main features and trends that characterise Portugal’s higher education system, setting the context for the discussion in the subsequent chapters, which focuses on different aspects of higher education resourcing policy. The chapter starts with an overview of the higher education landscape in Portugal, before analysing current demand for higher education along socio-economic, demographic and territorial lines. The chapter then examines the effect of demographic and economic trends on projected future demand for higher education and advanced skills.

This chapter focuses the question of how best to allocate public funds to higher education institutions to support their day-to-day operations and the delivery of their fundamental educational mission. It examines the current approach to allocating funds to public universities and polytechnics in Portugal before analysing different design components of allocation models used in comparator OECD jurisdictions. The chapter concludes with recommendations for promising policy options for Portugal as it seeks to establish a transparent and equitable funding model, which pays adequate attention to the diversity of institutions and territorial operating contexts in the country.

This chapter focuses on resourcing and governance policies to support higher education in Portugal respond effectively and efficiently to changing knowledge and skills needs in Portuguese society. In the coming decade, demand for higher education graduates – and their skills - will remain strong. Public universities and polytechnics will need to make even greater contributions to upskilling and reskilling, and to innovation in Portugal’s regional economies. However, demographic change will inevitably lead to a fall in local student demand in interior and island regions. The analysis and recommendations in this chapter highlight how carefully calibrated public policies can support HEIs to make strategic choices and adapt their profiles to changing circumstances, while ensuring an accessible, relevant and high-quality public higher education system.

This chapter examines the policies that Portugal has implemented to widen access to higher education. As discussed in Chapter 2, Portugal has succeeded in raising higher education attainment rates among young adults to a level that now exceeds the average of European Union countries. The government has committed to increasing participation in post-secondary education among young people following vocational pathways and adults in search of upskilling and reskilling opportunities. This chapter analyses the effectiveness of efforts to create an accessible network of higher education campuses across the Portuguese territory, the national financial support system for students and policies on student services and housing.