Belgium

Organisation and Financing

Measures have been taken to introduce an immediate employment declaration (Déclaration immédiate de l’emploi, D.I.E.) in the construction, interim employment and overland passenger transport sectors. This means that the employers concerned are obliged to notify the organisation collecting social security contributions (National Social Security Office or O.N.S.S.) of the dates on which employment contracts start and end, as well as various details which make it possible to identify the employer and any worker who has been newly recruited or whose contract is ending. These details must be notified, in principle electronically, at the latest when the worker starts work. Some of the details to be transmitted can be obtained by reading the worker’s S.I.S. card (new social security identity card originally introduced for health care and now replacing the former social security cards).

The aim of this immediate declaration is to inform the O.N.S.S. as quickly as possible of the dates on which the employment relationship starts and ends, so that it can include them in its files and to enable it to communicate them to the other administrative organisations on behalf of the employer, meaning that the employer now needs only to transmit the said details to a single organisation. The D.I.E. will also make it easier to control the legality of a worker’s occupation in the field. Furthermore, a new system of joint and several liability and of mandatory deductions has been introduced in the construction and other related sectors. These new measures should improve the collection of social security and tax contributions and effectively combat illicit practices among suppliers of labour. Joint and several liability means that anybody, except for a principal/private individual for strictly private purposes, calling upon the services of an unregistered contractor is jointly and severally liable for the latter’s social security and tax debts. It can happen that several sub-contractors who were involved in executing the works before him are liable for the social security and tax debts of the unregistered sub-contractor, based on chronological order. Furthermore, anyone who employs an unregistered contractor must make deductions on behalf of the organisations collecting social security and tax contributions when paying the invoice. If a contractor pays an invoice to a registered sub-contractor, he must also make a deduction for the O.N.S.S., except where the sub-contractor is not liable for social security contributions. If no deduction is made, a penalty is applied. A database is available to the interested parties to enable them to determine whether or not they are required to make deductions. No deductions need be made by employers who are not established in Belgium who have no social security debts in Belgium, or by any workers in possession of a valid secondment form. Registering the contractor does to some extent guarantee that the latter fulfils his social security and tax obligations. For this reason registration is granted only after an investigation and the operation of the committees granting the registration is optimised.

Healthcare

In 1998, two major structural measures were introduced in order to improve access to health care insurance for the entire population.

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• Insurability was reformed:

On 1 January 1998, all of the remaining schemes strictly for people who were not insured under another scheme were abolished. Now only two schemes remain: the general scheme and the scheme for self-employed workers.

Insurability has been relaxed. This has meant abolishing the six-month waiting period, abolishing the requirement for six months’ prior residence in Belgium and a reduction in (or exemption from) statutory contributions for people on low incomes.

• For the chronically-sick:

A set of measures was adopted in order to reduce their costs. These measures essentially consist of:

1. An annual fixed-rate allowance for health care of BEF 10,000 (a measure which has also been extended to 1999);

2. An annual fixed-rate allowance of BEF 10,000 for incontinence equipment;

3. A monthly fixed-rate allowance of BEF 5,000 for disabled people with dependants (provisionally BEF 2,500);

4. Allowances for three groups of chronically sick people: those with neuromuscular or metabolic diseases, or with cystic fibrosis.

Pensions

The main change has been to the national pension fund for mine workers (Fonds national de retraite des ouvriers mineurs). In view of the small number of people still covered by this institution, it was decided in 1996 to dissolve the Fund and to transfer its staff and responsibilities to the National Social Security Office and the National Sickness and Disablement Insurance Institute (Institut national d'assurance maladie-invalidité) respectively. The aim of this measure was to rationalise the management of the mine workers’ sector in order to reduce costs. Implementation measures were therefore adopted in order to effect this transfer on 1 January 1999.

Unemployment

During the period under review, procedures were established to enable workers recruited for a job officially recognised under government back-to-work programmes for the long-term unemployed and for young people undergoing intensive training with a view to a job, to benefit from an allowance paid from the unemployment insurance. In addition, the conditions were adjusted to allow workers who transfer from a full-time to a part-time job under the employment agreements which came into force on 1 January 1997, to maintain their entitlement to unemployment benefit. Also, the rules on unemployment were adapted to the new work patterns established as part of corporate plans to redistribute work in certain sectors of activity, as well as to career conversion programmes.

Family benefits

Since 1 October 1997, parents who are separated or divorced have been considered as forming a fictitious household with regard to bringing up children. This means that in all cases where there is joint custody, the father has remained the appointed priority recipient of the benefit and the mother as the person receiving the benefit. These rules have been refined. Now, where the parents disagree on the family benefits being awarded to the mother, the father is able to request the labour court to appoint him as the person entitled to the benefit, in the child’s interest.

In applying the provisions regarding to entitlement to family benefits for orphans or beneficiaries of a survivor’s pension, a declaration of absence in compliance with the Civil Code is treated as a death. Conditions for an absence waiting-period ruled by the court of first instance were imposed with regard to the deceased parent or spouse. These waiting-period conditions were established by taking into consideration the de facto date of absence recorded in the preliminary investigation ordered by the court, with the result that the conditions for granting the benefits have been fundamentally relaxed.

As from 1 July 1998, the five-year prescription period for the reimbursement of family benefits paid in error is automatically applied, which strengthens the protection of contributors to the national insurance scheme. The exception in the case of corrupt practices or of false or knowingly incomplete statements has been maintained.

Organisation and Financing

In order to promote self-employment, two major provisions have been introduced concerning the social security status of people setting up in business for the first time:

- A reduction in the professional earnings which serve as the basis for calculating the social security contributions of assisting spouses (conjoints aidants) who have been liable for tax as self-employed people since 1 January 1997 following changes to tax legislation.

- A reduction in social security contributions for the four quarters following the third full calendar year of self-employment in the case of a first-time business start-up as a principally self-employed worker.

A first-time business start-up is considered to be when an activity that is principally subject to the social security scheme for self-employed workers for a period of at least three full consecutive calendar years, is exercised for the first time.

No reduction may be applied to self-employed workers who exercise their activity on a supplementary basis or who, in the capacity of persons treated as self-employed on a supplementary basis, are liable only for a reduced contribution for the quarters of the fourth calendar year during which they are liable for contributions.

The final contributions owed for each of the four quarters of the year following the third full consecutive calendar year for which they are liable for contributions are reduced by a sum equal to 15% of their amount. However, the amount of this reduction may not exceed BEF 5,000 per quarter.

The measure came into force on 1 January 1998.

Disablement

An increase has been introduced, in the form of a fixed-rate allowance, in the disablement allowance where assistance is required from a third party.

Only self-employed workers entitled to a disablement allowance, who have dependants and for whom the assistance of a third party is deemed essential, may receive this allowance.

The amount of the fixed-rate allowance is BEF 28.17 as of 1 October 1998, representing an increased amount of BEF 96, and will be doubled as from 1 January 2000.

Social insurance in the event of bankruptcy:

Three further refinements have been made to the legislation concerning social insurance for self-employed workers in the event of bankruptcy. They concern the monthly benefit:

- Immunity from seizure of the monthly benefit of BEF 30,000 or BEF 25,000 (BEF 30,600 or BEF 25,500 following the index rise of 1 October 1997);

- Time limit of three years for legal payment of the monthly benefit and for reimbursement of benefits paid in error;

- Liability of the social insurance funds in cases where, through negligence, the monthly benefit has been paid in error and reimbursement of the payment made in error proves to be impossible.

These measures came into force on 1 July 1997.

Income support (MINIMEX) and advances on maintenance allowances

During the period under review, a variety of measures were introduced in order to foster the socio-vocational integration of beneficiaries of income support by means of back-to-work schemes, altering the method of calculating the earnings of an income-support applicant and advances on maintenance allowances.

The principle of an income support threshold was introduced in 1 January 1998. Where an income-support beneficiary works in a back-to-work programme as part of specific vocational reintegration measures for the unemployed, he is also entitled to a certain amount of income support from the public welfare centre (C.P.A.S.) for the portion of salary to be paid in the employer’s stead. These are the net amounts of income support to which the interested party is entitled for the calendar month concerned. If the income from the said back-to-work scheme is less than the amount of the income support to which interested parties are entitled as a result of their family circumstances, they are paid an income support supplement.

As from 1 January 1998, another incentive to foster socio-vocational integration has been to increase the possibilities of drawing income support whilst at the same time earning net income under a back-to-work or vocational training scheme. The aim of this measure is two-fold: firstly to extend the benefit of exemption for this income to assist people on income support who, as from 1 January 1998, have found a back-to-work scheme/job or vocational training course by themselves; secondly, to abandon the principle of making the measure degressive over time, by continuing solely to allow the exemption of the highest possible monthly amount for three years.

Where a public welfare centre itself acts as employer to beneficiaries of income support with a view to ultimately enabling them to receive the full benefit of certain welfare benefits, recruitment costs have been reduced, as from 1 January 1998, by the general introduction of exemption from employers’ contributions for any recruitment of income support recipients. All of the financial resources thus released must be spent in full on the public welfare centre back-to-work policy, including socio-vocational training.

A monthly financial incentive to encourage full-time employment has also been introduced as from 1 January 1998, with the aim of promoting the integration of people on income support through back-to-work schemes, by means of cooperation agreements between the public welfare centre and private firms. This subsidy is aimed solely at funding the costs of supervision and/or training paid by the centre and may not be used to reduce the cost of labour to the business firm.

The method of calculating the earnings of income support applicants has been refined: as from 1 January 1998, it is no longer possible to take into account grants and allowances for removal, settlement and rent received by the interested parties from the Regions.

Finally, as of 1 April 1998, modifications to the conditions for applying the law on maintenance allowance advances have been made at two levels to make the entitlement more effective. Firstly, the maximum amount of the monthly advance per child granted by the public welfare centre has been increased. Secondly, the maximum income of the maintenance creditor may now be exceeded by up to 15% without losing the right to advances. In such a case the advance is reduced by the same percentage.

Allowances for the disabled

As for allowances for the disabled, provision has been made for the integration allowance to be granted on an advance-payment basis.

The thirty-day period for filing an appeal against a decision by the Administration relating to entitlement to allowances has been raised to three months. Furthermore, the Administration may now adopt a new decision where it is discovered that the decision is flawed due to a legal or technical error.