Fighting poverty (?) Social Protection in AUSTRIA EU-Grundtvig Project Oct 2010 Caritas-MigrantInnenhilfe OÖ Mag.(FH) Mag. Brigitte Egartner +43 (0)732 /

2 Overview Facts & Figures Structure of Social Protection Schemes Universal schemes Family allowance Childcare benefit Means-tested benefits Social Assistance Means-tested Guaranteed Minimum Income

3 Facts & Figures The percentage of population at risk of poverty shrinks from 43 % before to 12,4 % after all social transfers and pensions. 1 Mio people at poverty-risk (< 951 Euros/mth), (6%) in deprivation children, in deprivation => every 4th at risk of poverty is under 20 => every 3rd child at risk of poverty has a migrational background Vulnerable groups: Children (especially between 3 and 5 yrs) Families with 3 or more children Single parents Migrants

4 Structure of Social Protection Schemes (1) => Institutionally and legally seperated two-tier system

5 Structure of Social Protection Schemes (2)

6 Universal schemes In general high percentage of cash benefits, but in terms of anti- poverty-measures the following public services should also be taken into account: education system (cost-free but still very selective; visious circle) youth welfare system (preventive and interventive measures) child-care facilities (obligatory but cost-free kindergarten year) high percentage of universal transfers (16% of total cash benefits), but only 3% of all cash-benefits are means-tested => lack of transfers for special groups at risk Universal family transfers (family allowance, childcare benefit)

7 Family allowance < 3 yrs: 163,80 Euros 3-10 yrs: 171,10 Euros yrs: 189,30 Euros > 19 yrs: 211,10 Euros Additional payments for 2nd, 3rd and 4th/5th/6th…child Double pays 4 times/years

8 Childcare benefit Until 2002 social insurance based entitelment Since then universal transfer with elements of means-test because restricts access for higher income parents (> Euros/year) => also some element of general means-test! Different options: shorter periods of receipt lead to a higher monthly benefit. New income-based model introduced in 2010 (1 yr, 80% of last income) Top-up payments for low-income families (181 Euros/mth)

9 Means-tested benefits Equalisation supplements in the pension system (top up payment for all pensioners at the equalisation supplement reference rate, currently 744 / Euros), 10 % of all pensioners Income-tested unemployment assistance (Notstandshilfe) after 6 or 12 months of unemployment benefit depending of the family income Grants to pupils and students of low income families Social assistance

10 Social assistance (1) Main instrument to support people in need Principle of subisidarity: support only in cases where… he or she doesn‘t receive enough payments out of insurcances (=> top-up payments!), has no claims on third parties (=> ex-spouses) and cannot be assisted through family ties (=> recourse liability!) Conditionality: make use of his or her means and abilities willing to work => no guaranted minimum income for children (dependent on how their parents‘ willingness to work) Principle of individuality

11 Social assistance (2) Federal structure of Austria => 9 different regulations since the 1970s, frequent amendments Differing rates and various additional payments (clothing, heating, rent,…) Current rates for Upper Austria (full rates or top-up payments): Single assisted person: 577,50 Euros Main assisted person: 521,70 Euros Co-assisted person without family allowance: 340,30 Euro Co-assisted person with family allowance: 162 Euros => Rates do not reach poverty-risk treshold as defined by EU-SILC!

12 Means-tested Guaranteed Minimum Income For 2011 transformation towards a MGMI planned, but draft law for Upper Austria still missing. Basic agreement on national level contains several major changes: Guaranteed national minimum income of 744 / Euros will replace the currently nine rates of the provinces (=> harmonisation of regulations, avoiding poverty and exclusion) Job centers will serve as entry point for social assistance recipients categorised as fit for work (=> fostering employment) Recourse liability limited (=> reducing stigmatisation and increasing take-up rate) => No basic income but national income provision that still imposes certain conditionality on claimants