Social security schemes need updating to cope with demand says EU

The EU is calling on its member states to modernise their minimum income schemes in the context of global economic uncertainty and looming recession. In a statement on September 28, the EU released advice on how member countries can design minimum income policies to lift people out of poverty and support their economies.

The EU is anticipating continued economic hardship this winter, which will particularly hit those already living in poverty. It described minimum income as a “springboard to improve inclusion and employment prospects” which can break sustained cycles of poverty. Minimum income is cash payments to “bridge the gap” between a household’s income and the necessary funds to live a life with dignity.

The EU considers well-designed minimum income schemes to reduce poverty while incentivising work.

The scheme forms part of the EU’s European Pillar of Social Rights Action Plan which aims to reduce the number of people at risk of poverty by 15 million by 2030. The plan is also tasked with providing employment for 78 per cent of the workforce between the ages of 20 and 64.