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Working age people entitled to Minimum Income above the poverty line (at 60 per cent of median) by whether poor in absence of Minimum Income
Source publication
The purpose of this paper is to explore and compare the effectiveness of Minimum Income (MI) schemes in protecting people of working age from poverty in the European Union. Using the EU-wide microsimulation model EUROMOD, we investigate (a) coverage and (b) adequacy of MI schemes in 18 countries. In contrast to previous comparative studies of MI be...
Context in source publication
Context 1
... the rate of entitlement is relatively low at low incomes, this suggests that there may be gaps in coverage. Another aspect of coverage is whether MI recipients would be poor if they did not receive MI. Using 60 per cent of median disposable income as the poverty line, Figure 6 shows that this only applies in a small number of countries, mainly Belgium, France and the UK. The dark section of the bars identifies those entitled to MI schemes who would not fall below the 60 per cent poverty line even if they did not receive MI benefit. ...
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Citations
... Immervoll, 2010) and EUROMOD publications (e.g. Figari et al., 2010). A certain degree of comparison with so-called "good performers" is also possible, restricted only by the fact that performance significantly depends on other factors such as the general economic situation and the efficiency and effectiveness of upstream social welfare systems (such as unemployment benefits) as well as other context-related conditions. ...
... Immervoll, 2010) and EUROMOD publications (e.g. Figari et al., 2010). A certain degree of comparison with so-called "good performers" is also possible, restricted only by the fact that performance significantly depends on other factors such as the general economic situation and the efficiency and effectiveness of upstream social welfare systems (such as unemployment benefits) as well as other context-related conditions. ...
The study on the "social dimension" of the EU aims at identifying thematic key areas that should be covered by benchmarking processes during the next upward policy convergence in order to strengthen the social dimension of the EU. The study not only suggests potential benchmarking indicators but discusses their pros and cons. This includes considering the pitfalls for benchmarking the “Social Union”. Accompanying measures are suggested that help the EU to benchlearn from their manifold experiences and social systems.
... There are almost as many minimum income schemes in Europe as there are member states, and they vary in both coverage and comprehensiveness in terms of selectivity criteria, and effectiveness in terms of their impact on the levels and depth of the income poverty risk (Cantillon et al., 2008;Figari et al., 2010;Rat, 2009). 1 Cantillon et al. (2008) report that minimum income protection is supported by benefits in at least 19 of 25 European Union (EU) member states. Frazer and Marlier (2009) depict four types of minimum income schemes across Europe: simple and comprehensive schemes for those with insufficient means of living (e.g. ...
... Ideally, the impact assessment of a new benefit scheme such as a minimum income scheme would be best examined via the national tax-benefit model. Figari et al. (2010), for example, used the micro-data derived from national income surveys and simulated entitlement to minimum income schemes in the EU by using an integrated tax-benefit micro-simulation model. Meanwhile, for Turkey, Yakut-Cakar (2010) constructed a static national model based on the 2004 Household Budget Survey (HBS) data. ...
Turkey is one of the few countries in Europe without a minimum income scheme. In an effort to simulate the potential economic impact of introducing such a scheme in Turkey, data from the 2007 Statistics on Income and Living Conditions were used to consider various policy scenarios with regard to eligibility conditions and benefits. The impact of a minimum guaranteed income scheme on the extent of poverty, income distribution and the proportion of potential beneficiaries at the individual and household levels were investigated under different policy variations, as well as their corresponding costs. Subsequent analyses provided supporting evidence for the affordability of minimum income schemes in Turkey that would contribute to altering inequalities in income distribution.
The study “The Social Dimension of the EU” aims at identifying thematic key areas for potential benchmarking processes in the social field during the next potential upward policy convergence. Pros and cons of the benchmarking process, its benchmarks and corresponding social indicators are discussed, exemplified by the minimum income benefits, and further analysis suggested to supplement the exercise. The study shows that benchmarking in the social dimension has its pitfalls when focussing on purely quantitative target setting. Thus, benchlearning processes are suggested, in which analysing the causes and frameworks for the societal challenges, learning from others and action taking stands in the forefront.
European countries vary in the extent to which they succeed in reducing poverty using social transfers. However, we do not have good ways of understanding how these different outcomes are achieved. It is therefore very difficult to learn lessons from abroad. This paper uses micro data from the EU Statistics on Income and Living Condition (SILC), and attempts to decompose reductions in child poverty rates and gaps into the contribution made by children, old age, social exclusion, housing and work-related benefits. The analysis is undertaken for all families with children under 16, lone parent families, couple families, and then for families with varying levels of work intensity.
Transfers make a substantial contribution to reducing child poverty rates and closing poverty gaps. The contribution varies between countries in the European Union. There is no single model, no most successful exemplar. Some countries do better for their children in lone parent households and others do better for their children in couple households.
The analysis has enabled some opening up of the how question, though what is going on is still something of a mystery in some countries. It is probable that analysis at the national level with greater knowledge of national benefits systems is necessary to further open the ‘black box’.
Taxes, which are the biggest sources of public services funding, are welding current from private sector to public sector. However, appropriate use of tax revenues for social and economic policy has increased the importance. Therefore, the use of taxes in the form of social transfers and income groups that are determined of according to some criteria, are not been taxed even came up with the idea of tax repayment and negative income tax has been developed.
The aim of this method is prevention of poverty and increasing social welfare by improving of the distribution of income. However, negative income tax has some potential unfavourable effects such as reduction in labor supply due to the substitution effect, serious financial burden to the government and to encourage the formation of informal labor. Therefore, having a history of nearly 80 years of negative income tax proposal has not seen sufficient importance by countries. Nevertheless, negative income tax could get the opportunity to be practiced in a limited area. Also, when we look at the perspective of undeveloped and developing countries where unfair distribution of income is seen most commonly, these countries have been pushed to reluctance about applicating of negative income tax by potential risks of high inflationary pressures will be occur due to negative income tax and these countries’ structural problems such as lack of income resources in addition to the above adverse effects. But today despite all these, negative income tax is put into practice by some countries, and it is known that the studies on this issue continue. In our study, the concept of a negative income tax discussed at various aspects and applications of selected countries were examined.
Keywords: Social politics, income distrubution, negative income tax, social welfare
In most EU countries some form of "minimum income" as a measure of "last resort" exists, which ensures a minimum standard of living for individuals and families who do not have sufficient resources. However, such schemes differ enormously as regards coverage and adequacy, as well as efficacy in reducing poverty and social exclusion. The present report moves on from a previous study commissioned by the European Parliament in 2007 to consider the evolution that has occurred in the meanwhile
