Against the background of rising energy prices and high inflation, minimum income schemes have gained even more importance throughout the EU. As a final safety net, well designed minimum income benefits are essential to lift people out of poverty and to prevent the risk of poverty. The EU Commission has now presented a proposal, which shall serve Member States as a guideline for an adequate and inclusive design of their minimum income schemes.
According to Eurostat, in 2021, ca. 21.7 % of the EU population were at risk of poverty or social exclusion. To support these people and to guarantee them a dignified life in accordance with the European Pillar of Social Rights, one needs a comprehensive minimum income scheme. Apart from specifically supporting the people affected, these benefits – if they are adequate - may also contribute to reducing social inequality. The EU Commission intends to make a start with its Proposal.
Guide to improve national minimum income schemes
The target set for Member States to implement adequate minimum income schemes by 2030 at the latest, is at the centre of the recommendation. In concrete terms, all people, who depend on such support, shall be paid a minimum income. The relevant criteria has to be transparent and free of discrimination in order not to exclude or neglect certain groups. Apart from that, people who are potentially affected, have to be given easy access to all necessary information on the possibility of receiving minimum income support; any stigmatisation has to be avoided to ensure that these benefits are actually claimed. Regarding the response time to an application, a period of 30 days has been provided for.
Parallel to receiving minimum income benefits, the EU Commission also wants to ensure that targeted vocational education and training measures will improve the chances of (re)entering the labour market. This also requires the dialogue with employers to create recruitment incentives. The proposal also refers to facilitate access to social services such as health care or childcare. Finally, responsible authorities have to be adequately staffed to have sufficient capacities to ensure the timely implementation of these regulations.
With regard to financing such extensive minimum income schemes, the EU Commission refers to existing EU funds, which are available to Member States. Hence, at least 25 % of allocations from the European Social Fund Plus shall be used to address social exclusion.
AK: Lack of binding force a major shortcoming
From AK’s point of view, the initiative by the EU Commission has to be welcomed as it contains many sensible approaches to improve social security. However, a directive would have been significantly better suited than a legally non-binding Council recommendation. Hence, there is still a lack of binding minimum standards as well as definitions and basic principles regarding the structuring of minimum income schemes in individual Member States. Thus, the adopted Council recommendation can only act as a guide.
Positive though is the explicit mentioning in the proposal of the EU Commission of the significance of supplementary monetary social benefits. Apart from that the Commission proposal also deals with accessing important services. The creation of a comprehensive and high-quality social infrastructure is a necessary addition to minimum income regulations. In this context, in particular access to health care, housing benefits or childcare must be mentioned.
Apart from the recommendation on adequate minimum income schemes, AK would have also liked a mention of the importance of preventive measures to avoid poverty and social exclusion. Here, in particular a positive wage development, which can be significantly influenced by comprehensive collective agreements, is playing an important role.