Spain’s welfare state in danger under crippling weight of Covid-19 pandemic

Spain’s welfare state is in danger under the crippling weight of the Covid-19 as more people are currently receiving social security benefit than wages as employees.

MINISTERS and ecocomists fear the country is facing a recession which will be a measure of an economic system which, at the moment, subsidies, public aid and grants outweigh private initiative.

Latest official data from the Ministries of Labour and Inclusion shows there are 15,878,060 people in Spain receiving social security benefits, taking into account both contributory and non-contributory pensions and unemployment benefits.

And there are 15,321,500 employees in Spain among those affiliated to the social security system.

In short, the Ministry claims there are now half a million more people surviving on cash from the public sector than wages.

And economists are concerned about the consequences on entrepreneurship and the normal functioning of the labour market, as people with the capacity to work are instead assisted by the government.

They fear the latest minimal vital income measures will only add to a situation of a “subsidised Spain.”

Although the move may have positive effects from the outset, such as preventing extreme poverty among certain groups, even parties such as the PP that voted in favour of it in Congress admit it should be a temporary measure.

Spanish Confederation of Business Organisations (CEOE) leaders and businessmen, who have supported social measures from the Executive despite the fact that it would have a cost for companies (as is the case with the increase in the minimum wage), warn internally that the minimum income could see a growth in underground economy in Spain.

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Written by

Tara Rippin

Tara Rippin is a reporter for Spain’s largest English-speaking newspaper, Euro Weekly News, and is responsible for the Costa Blanca region.
She has been in journalism for more than 20 years, having worked for local newspapers in the Midlands, UK, before relocating to Spain in 1990.
Since arriving, the mother-of-one has made her home on the Costa Blanca, while spending 18 months at the EWN head office in Fuengirola on the Costa del Sol.
She loves being part of a community that has a wonderful expat and Spanish mix, and strives to bring the latest and most relevant news to EWN’s loyal and valued readers.

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