Employment, Social Affairs & Inclusion

News 26/07/2019

Important social developments in Austria and Latvia

Four new Flash Reports prepared by the European Social Policy Network (ESPN) are now available and provide information on recent social policy developments in Austria and in Latvia.

Important social developments in Austria and Latvia

  • Just before the premature breakdown of the Austrian centre-right coalition government, the Parliament passed a “Framework Act on Social Assistance” in May 2019. Unlike earlier attempts to coordinate the minimum income schemes of the federal provinces, this Act stipulates maximum benefit levels (instead of minimum levels) and a substantial differentiation of benefit levels between different groups of recipients. Among other things, the reform will de facto have a negative impact on various groups of recipients - especially people with a migration background.
  • After the premature breakdown of the Austrian centre-right coalition government at the end of May, early national elections will be held in Austria by the end of September. In the meantime, a series of expansive measures have been decided by free-floating majorities in parliament, in different areas of social policy. Although some observers and stakeholders have criticised these measures, labelling them as “election goodies”, most of them in fact address actual problems, where good arguments for action exist.
  • In recent years (2015-2019), out-of-family childcare has become the focus of considerable attention in Latvia, with various initiatives having been implemented to stimulate the transfer of children from out-of-family care to family-based or family-like care. Problems, however, still persist in inter-institutional cooperation: local governments and their institutions are not keen to implement the reforms, which creates obstacles for the further development of foster families and the successful transition of children from institutional care to a system based on a familial environment.
  • The solidarity tax introduced in Latvia in 2016, levied on earnings above the social contributions cap, was aimed at reducing tax regressivity for high-earning workers. The original law has been amended, modifying the tax distribution scheme and strongly undermining the initial solidarity basis of the tax.

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