President announces ‘Guaranteed Minimum Income’ for all citizens

Cyprus Mail, July 26, 2013

 

Anastasiades: reform of social policy

PRESIDENT Nicos Anastasiades on Friday announced the complete reform of social policy based on the principle of securing a Guaranteed Minimum Income for all citizens.

It should be fully in place by June 2014, he said.

“Beneficiaries will be all of our fellow citizens who have an income below that which can assure them a dignified living, irrespective of age, class or professional situation,” Anastasiades said in a statement.

He said the level of the Guaranteed Minimum Income would take into consideration the needs of every citizen and every household concerning nourishment, clothing, consumption of electricity and other indispensable items.

At the same time, it will guarantee the right for housing of the economically weaker groups of the population, he said. This will be done either through the subsidisation of the rent if the beneficiaries don’t own their own residence, or through the subsidisation of the interest on housing loans in the cases where people own a house but face problems in paying instalments.

“Also covered will be unforeseen expenses, which unfortunately come up in every household, such as, for example, absolutely necessary construction and repairs to houses, municipal taxes, etc,” he said.

“What I want to stress emphatically is that the Guaranteed Minimum Income will also be provided to thousands of our fellow citizens who, in spite of their needs, are not covered to this day by the existing system and they did not receive any substantial assistance from the state,” the president said.

He said these would include unemployed graduates of schools and universities, working people with particularly low earnings will have their income supplemented to reach the Guaranteed Minimum Income, and the self-employed, who have found themselves out of work and who, until now were not covered.

“Many of the pensioners with low pensions, without adequate contributions to the Social Insurance Fund, will also receive higher payments than they receive today,” said Anastasiades.

He said the general principle of the plan was that there would not be any citizen who was “not guaranteed the minimum needs for a dignified living in a European Country”.

The Guaranteed Minimum Income will replace, but will also be financed by a large number of allowances have been until now not targeted and often arbitrarily, given by different ministries and different services of the state.

“The policy of non-targeted and scattered allowance is terminated,” Anastasiades said.

“ A policy which, in spite of  burdening significantly the public finances and the taxpaying citizens, did not manage to reduce the inequalities and often ignored fellow citizens who are truly in need.”

The new policy of social welfare will from now would be concentrated under the same authority – in other words, there will be a merging of services that until today were giving subsidies, whether these refer to the Ministry of Labour and social Insurance or the Ministry of interior or the Ministry of Finance.

Allowance that concern students will remain under the Ministry of Education.

The president said the level of the Guaranteed Minimum Income would be determined in an objective and scientific way by the Statistical services, with the International Labour Office playing a catalytic advisory role.

At the same time, the new policy provides for the continuation of the unemployment allowance at the level and duration that applies today, in other words six months.

“For the first time, however, with the introduction of the new system, our fellow citizens who continue to be unemployed will be able to continue to live with dignity, since they will be receiving the Guaranteed Minimum Income,” Anastasiades added.

“The single but absolutely necessary precondition is that they don’t refuse to accept offers for employment and to participate in the policies of continuous employment that are determined by the state,” he said.

The policies of active employment will be financed mainly by the European Social Fund, and they will aim to encourage and to facilitate the unemployed in their effort to find employment. They will concern programs for education, practical training or subsidized employment.

Beyond the Guaranteed Minimum Income, the Unemployment Allowance, and the policies of active employment, the new social welfare policy of the state will be supplemented through separate allowances that concern other groups of the population which have certifiable needs, such as, for example, paraplegics and the children with special needs and a stack of other similar categories.

He said the troika had accepted the government’s proposal “for a modern conceptualization on the policy of social welfare and prosperity”.

He said dialogue would start immediately for implementation of the new system by June 2014.