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Recent social policy developments in Croatia, Denmark, France, Latvia, Lithuania, Luxembourg and Romania

10/07/2017

9 new Flash Reports prepared by the European Social policy Network (ESPN) are now available. They provide information on recent social policy developments in the fields of emigration (Croatia), pensions (Denmark and Latvia), unemployment (Denmark and France), housing (Lithuania and Luxembourg), family policy and health (both Romania).

  • Since joining the European Union, Croatia has experienced significant levels of emigration, particularly of people of prime working age. Combined with falling birth rates, emigration contributes to overall population decline, shortages of key skills and an ageing population. The government could do more to promote circular migration, investing in those professions and geographical areas where propensity to migrate is highest.
  • The new Danish old-age pension reform improves incentives for postponing retirement and for pension savings for persons in the later years of their career, while also strengthening residence as a basis for entitlement to the universal national old-age pension.
  • Denmark has recently adopted a new unemployment insurance scheme for the self-employed and persons in non-standard jobs. In this new scheme, unemployment is defined in relation to activities rather than to a categorisation as self-employed or wage earner. The reform will provide better unemployment coverage to the self-employed, persons in non-standard jobs, persons with multiple jobs and persons combining employment and self-employment.
  • After considerable tensions, French trade unions and employers’ organisations have agreed on new unemployment insurance rules which have been validated by the government. The agreement includes a minor increase in employers’ contributions and stricter eligibility rules which are expected to have a significant budgetary impact.
  • The sustainability of the old-age service pension scheme in Latvia has been questioned by the country’s State Audit Office. Contrary to the contributory statutory pension scheme, service pensions are calculated as a certain percentage of the last salary. Given the significant differences within the scheme itself and with the general old-age pension scheme, a thorough assessment of the groups that should be entitled to service pensions is important to ensure equal treatment.
  • In Lithuania, the reduced 9% VAT rate on district heating, hot water and drinking water -which had applied since 1 September 2009- has been raised to the standard 21% rate. This is likely to increase energy poverty, reduce the budget for other social programmes managed by municipalities and increase the burden on administrations.
  • Shortages in the (social) housing stock and the burden of housing costs on low-income households have been among the major social policy problems in Luxembourg for many years. Any measures to alleviate this burden are therefore important, such as the measure introduced in 2016 to provide low-income households with advice on energy saving.
  • In May, the Romanian Minister of Labour and Social Justice announced her intention to re-introduce an upper cap on the child-rearing indemnity. While the issue of high-level child-rearing indemnities only affects at most 3% of the beneficiaries, it is important to redirect public attention to social justice.
  • Romania has been affected by a major epidemic of preventable childhood diseases (especially measles) and low immunisation coverage of the child population. The crisis was fuelled by a widespread lack of trust in vaccination, concomitant with a lack of adequate vaccine supplies. In April, the government drafted a law regarding mandatory vaccination which has been facing strong opposition.