Report from the Commission to the Council, the European Parliament, the Economic and Social Committee and the Committee of the Regions on the implementation of the recommendation 92/441/EEC of 24 June 1992 on common criteria concerning sufficient resources and social assistance in social protection systems
Date: 1999-01-25
Institutions: European Commission
Subjects: employment policy, poverty, social integration, social security, social-security benefit

COMMISSION OF THE EUROPEAN COMMUNITIES 

Brussels, 25.01.1999 
COM(1998) 774 final 

REPORT FROM THE COMMISSION 

TO THE COUNCIL, THE EUROPEAN PARLIAMENT, 
THE ECONOMIC AND SOCIAL COMMITTEE 
AND THE COMMITTEE OF THE REGIONS 

ON THE IMPLEMENTATION  OF THE RECOMMENDATION  92/441/EEC OF 24 JUNE  1992 ON 
COMMON CRITERIA CONCERNING  SUFFICIENT RESOURCES AND SOCIAL  ASSISTANCE 
IN SOCIAL PROTECTION  SYSTEMS 

EXECUTIVE SUMMARY 

The  purpose  of  this  report  is to  evaluate  the  role  of  minimum  income  schemes  within  social 
protection  systems as components  of the fight  against  poverty,  and to  analyse the  contribution 
of  these  schemes  toward  enabling  social  and  economic  reintegration.  It  is  born  of  EEC 
Recommendation 92/441, of 24 June  1992, which  was intended  by the Council  as a means of 
supporting the efforts  being undertaken by Member States to address poverty and exclusion. 

Within  the  broad  range  of  social  transfers  provided  by  social  protection  systems,  minimum 
incomes  are  the  final  safety  net  mechanism  of  income  redistribution.  They  help  the  poorest 
people  in  society  by  covering  basic  needs  without  any  requirement  for  prior  contributions. 
Behind  the  common  principles  expressed  in  the  Recommendation  lie  complex  and  varied 
national  methods of implementation.  In fact,  minimum incomes do not  act  in isolation  in social 
protection  systems, but form part of a range of benefits  and social services, of which the report 
gives a first  overview. 

The  number  of  minimum  income  beneficiaries  has  risen  since  the  end  of  the  1980s.  There 
appear  to  be  two  main  factors  behind  this  rise.  The  first  is  higher  and  more  persistent 
unemployment.  The  second  relates  to  a  rise  in  the  numbers  who  have  experienced  social 
disruptions  in  their  lives,  i.e.  family  breakdown,  forced  migration,  homelessness,  over-
indebtedness, prison. Compared to the overall population,  single men and single-parent  families 
are over-represented. 

Member  States,  to  varying  degrees,  relate  minimum  incomes to  measures  aimed  at  increasing 
access  to  employment.  The  range  of  action  this  implies  includes:  mobilising  employment 
services more strongly for the most disadvantaged  people; socially useful  activities; job creation 
in the  non-profit  sector;  financial  incentives  to  employers to  hire  minimum  income  recipients; 
and helping people to move into employment without loss of income. These measures still have 
a  limited  impact  and  should  evolve to  improve integration  of minimum  income  recipients  into 
the  labour  market.  This  shift  towards  more  active  support  for  minimum  income  recipients  of 
working age is consonant with meeting the commitments of the European employment strategy 

In  looking  for  greater  effectiveness,  several  Member  States  are  widening  their  scope  of 
intervention  to  include  measures  which  aim  at  improving  economic  and  social  integration  of 
minimum  income  recipients.  This may cover broader  social  issues  such  as  housing,  education, 
family,  health  or  citizenship.  A more  individualised  approach  is also being developed,  in some 
Member States, which more actively involves minimum income recipients in designing personal 
projects with the support of social and employment services, as well as that of local partners. 

The  Council  Recommendation  has  helped  to  organise  and  stimulate  the  debate  between 
Member  States on the role and development  of minimum income schemes. The schemes that it 
covers are continuously evolving and need to do so in a holistic way, in terms of general social 
policy action and, particularly, employment policy. In order to help optimise the effectiveness  of 
Member  States'  action  in  delivering  social  protection,  increasing  access  to  employment,  and 
developing  social  and  economic  integration,  this report  offers  material  with  which to  develop 
the debate  and  prepare the ground  for  implementing the  new Article  118 of the future  Treaty 
(article  137 of the consolidated version). 

Table of Contents 

I. 

The position of minimum income schemes in social protection systems 

1. The final safety net 
2.  The contribution of other benefits 
3. A variability for work 
4. Social support 

II. 

Recent trends in the use of minimum income schemes 

1. The relief of poverty 
2. Who are the beneficiaries? 
3. Sliding down from  unemployment benefit to minimum income 
4. Obstacles preventing exit from the schemes 

4.1  The risk of the benefit (raps 
4.2 Finding a job  is not always enough 

HI. 

Pathways to employment 

1. What should be expected from  employment services? 
2. How to improve employability? 

2.1 Improving skills and competences 
2.2 Specific measures,  as temporary solutions 
2.2.1 Incentives for  voluntary activities 
2.2.2 Subsidised jobs  in the non-profit sector 

3. Access to (he labour market 
.31 Access to companies 
3.2 Financial incentives for  returning to work 
3.2.1 Adjusting minimum income rates 
3.2.2 Smoothing (he transition from minimum income to a paid job 

IV.  A step further, individual pathways to integration 

V.  Perspectives, sufficient  resources and assistance as a starting point for social and economic 

integration 

Annexes 

Council Recommendation  92/441/EEC of 24 June 1992 

Tables 
1. 
2. 

3. 
4. 
5. 

The national minimum income schemes, main associated benefits and services. 
Levels of support provided by the minimum incomes, family and housing benefits, 
expressed in purchasing power parities. 
Characteristics of minimum income recipients. 
The situation of minimum income claimants with regard to employment. 
Results achieved by socio-economic integration measures. 

In  1992 the Council  adopted  two  Recommendations  based  on Commission  commitments  in its 
Social  Action  Programme  for  the  implementation  of  the  Community  Charter  on  the 
Fundamental  Social  Rights  of  Workers  (December  1989).  The  first1  deals  with  the 
convergence  of  social  protection  objectives  and  policies,  and  includes  amongst  its  common 
objectives  the  guarantee  of  a  level  of  resources  in  keeping  with  human  dignity.  The  second 
Recommendation2  sets  out  the  principles  and  conditions  by  which  this  guarantee  is  to  be 
implemented. This Recommendation,  a copy of which is enclosed, is the subject  of this report. 

This  report  is  based  on  three  main  sources.  The  first  is  the  results  of  the  1996  European 
seminar organised  in Lisbon3 when Portugal was about  to  introduce national  minimum income 
provisions. The second is a further  enquiry conducted among Member  States in  1997. The third 
is  work  done  by  the  European  Foundation  for  the  improvement  of  living  and  working 
conditions4. The report  evaluates the role of minimum income schemes within  social  protection 
systems from  the point  of view of the fight against  poverty  It also analyses the contribution  of 
these schemes to the social and economic reintegration of their recipients. 

The  report  should  also  be  seen  as  having  links  with  the  Commission's  activities  to  promote 
discussion  on  modernising  and  improving  social  protection  in the  European  Union5  and  with 
the  European  Employment  strategy6.  It  forms  part  of  the  Commission's  preparation  for 
implementation  of  the  new  Article  118  of  the  future  Treaty  (article  137  in  the  consolidated 
version) in relation to social exclusion. 

I - The position of minimum income schemes in social protection systems 

The origins  of  minimum  income  schemes  can be traced  back  to  the  very beginnings  of public 
social  assistance  to  the  poor  and  disadvantaged  when they were unable to  make a living  from 
other  means.  Providing  a  minimum  income  to  people  without  resources  was  seen  as  a moral 
duty  and  helped  to  maintain  a  degree  of  social  stability.  As  comprehensive  social  protection 
systems  were  being  constructed,  minimum  income  schemes  were  integrated  into  them  to  a 
greater or a lesser extent. 

In  countries  where  social  insurance  based  on  employment  predominates  (for  example, 
Germany,  Belgium,  Austria,  France,  and  Luxembourg),  minimum  income  schemes,  which  are 
not  contribution-based  and  support  people  out  of  work,  have  remained  outside  of  social 
security  systems.  The  situation  in the Netherlands is similar.  Responsibility  for  management  of 
these  schemes  has  been  left  to  local  authorities.  National  authorities  are  involved  to  only  a 
limited  degree and do no more than  establish  a common  legal framework  for the various types 
of action. 

1  Recommendation  92/442/EEC of 27 July  1992, J.O. L 245 of 26-08-92. 
2  Recommendation  92/441/CEE of 24 June  1992, J.O. L 245 of 26-08-92. 
-^ "Minimum  income  policies  in  the  European  Union"  Pierre  Guibentif-Denis  Bouget,  1997;  published  jointly  by  the 
Commission,  the  Portuguese  Ministério  da  Solidariedade  e  Segurança  Social  and  the  Vniâo  das  Mulalidadcs 
porluguesas. 

4  "Report  on  GMJ  development  in  EU  Member  Countries  in  1992-1997",  Matti  Heikkila,  Darren  McCausland,  working 

document, Dec.  1997. 

5  COM(97)102 final  of  12-03-97 
6  European  Employment Guidelines, Resolution of  15 December  1997, for  1998; COM(98) 574 final  for  1999 

However,  minimum  income  schemes  have been  perceived  as intrinsic to  those  social  protection 
systems where a more universal  approach is adopted,  based on people's  needs and underpinned 
by  the  concept  of  assistance.  This  is  the  situation  in  Ireland,  the  United  Kingdom,  the  Nordic 
countries  and,  more  recently,  Portugal.  In  these  cases,  minimum  income  schemes  took  on  a 
more  integrated  appearance  from  the  start,  with  higher-profile  state 
intervention  The 
Mediterranean  countries  lie  between  these  two  models;  minimum  income  schemes  are  still 
relatively  rare.  There  is  none  at  all  in  Greece,  some  local  schemes  in  Italy7  and  schemes 
operated  by the Autonomous  Communities in Spain. 

These  differences  show  up  in  the  way  that  management  and  financing  responsibilities  are 
allocated  at the national,  regional  and local  levels.  However,  the fact that the schemes  are faced 
with  similar socio-economic  changes  and have  to  respond  to  the  same  types  of  problems  helps 
to bring them closer together in practice. 

I -  /.  The  final  safety  net 

Minimum 
contributory,  financed  by tax revenues  and  secondary  to family  solidarity. 

incomes  cover  essential  needs  in  situations  of  financial  crisis.  Ihey  are  non-

Minimum  income  schemes  operate  as  a final safety  net  for  those  unable  to  make  their  living 
in  the  Recommendation  (C-2),  minimum  incomes  provide  a 
otherwise.  As  mentioned 
differential  financial  aid.  They  make  up  the  shortfall  between  own  and  family  resources  -
whether  in the form  of  earnings  from  work  or other  social  benefits8  -  and guaranteed  minima. 
This general  principle covers complex  and varied national methods of implementation9. 

The  schemes  cover  fundamental  needs,  as  envisaged  by the  Recommendation  (section  C-l-a). 
The levels of the minimum incomes are generally defined  for a country as a whole,  but may take 
into account  regional  variations in the standard or cost  of living.  Minimum incomes are indexed 
to consumer prices or to other social benefits (section C-l  c and e of the Recommendation). 

Minimum  income  schemes  involve  a  preliminary  assessment  of  the  claimant's  resources.  As 
specified  by the  Recommendation  (Section  B.3),  in all Member  States this is an assessment  not 
of the  applicant  but  of  the  household  situation10  in which  that  person  lives.  This  is  the  critical 
criterion upon which the provision  of assistance depends.  The levels of payment then  depend  on 
the  composition  of  the  household.  Minimum  incomes  are  also  subsidiary  to  family  solidarity. 
To  a greater  or  lesser  extent  claimants  have to  try to  obtain  any  maintenance  payments  due  to 
them. 

The  secondary  status  of  minimum 
social  benefits 
(Recommendation,  Section B-5),  varies.  In eight  Member  States  -Belgium,  Austria,  Germany, 
Spain,  France,  Ireland,  Luxembourg  and Portugal-  minimum  income  claimants  must  have  used 
up  their  entitlement  to  other  social  benefits.  Minimum  income  support  may  temporarily  be 
provided  while  awaiting  a  decision  on  claims  for  another  benefit11.  Several  Member  States, 

incomes,  compared  with  other 

7  Italy did not respond to the Commission questionnaires in  1996 and  1997. 
** Taken in a broad sense of all social protection payments including other social minima. 
9  There are  for example instances when minimum  income is not granted whilst income from  work  or  from  other  benefits  is 
lower  than  the  guaranteed  minima.  This  question  is  discussed  in  several  chapters  (II-4-2,  HI-3-2.2)  as  well  as  in  the 
conclusions. 
1 (>  There are variations in national  definitions. 
1 '  As an example, Ireland in particular uses this arrangement. 

such  as the  Netherlands,  Germany  and  Luxembourg,  indicate  that  minimum  incomes  may also 
be used  to  supplement  retirement  or  unemployment  benefits.  Only  some  Spanish  Autonomous 
Communities do not allow  a combination  of these benefits  with  minimum  incomes.  In the UK, 
Denmark,  Finland,  Sweden  and the Netherlands,  claimants need  not  have used  all  entitlements 
to other benefits.  Minimum income schemes, nonetheless, remain  the final safety net. 

Minimum  incomes  are  non-contributory.  No  previous  contributions  need  to  have  been  made. 
Accordingly,  funding  of these measures in the Member  States is, in general,  dependent  on tax 
revenues rather than on contributions paid from earned income. 

Minimum income schemes are not time-limited, in line with the Recommendation's  requirement 
(Section  B-4)12  The  termination  of  payments  depends  on  the  level  of  resources  of  the 
household  Despite this open-ended  nature, minimum  incomes in most  Member  States are only 
intended  as  a  temporary  measure  to  alleviate  exceptional  situations  which  recipients  are 
expected to escape from,  particularly through employment, with or without other assistance. 

I - 2.  The contribution of other benefits 

Minimum income schemes do  not  act  in  isolation but rather as part  of  a  range  of  various 
social benefits, social services and aid in kind. 

This report  covers the schemes most generally applied (cf table  1).  In Ireland  and the  UK, the 
schemes  are  divided  into  two  benefits  according  to  the  work  availability  of  the  recipients.  In 
some Member  States specific  non-contributory  social minimum arrangements  exist which cater 
for: 
-  persons  who  have  reached  statutory  retirement  age:  six  Member  States  have  such 

arrangements: Belgium, France, Spain, Ireland, Portugal and the UK13; 
people  with  disabilities:  seven  Member  States  have  established  minimum  income  for  the 
most  severe disabilities:  Belgium,  Spain,  France,  Ireland, the Netherlands,  Portugal  and  the 
UK  (lootimic i;i>; 
lone-parent  families:  specific minimum income benefits  exist to a certain degree in Belgium, 
France,  Ireland and the UK (footnote i.i); 

- 

' 

- 

Seven  Member  States  set  age  requirements  (18  years  for  Belgium,  Ireland,  the  Netherlands, 
Portugal  and  UK14,  25 for  France and  Spain,  and  30 for  Luxembourg)  which  exclude  part  of 
the  working-age  population  from  the  schemes.  France,  Spain  and  Portugal  lower  the  age 
requirement  when  the  recipient  has  responsibility  for  dependents.  In  addition,  the  schemes 
considered  in  this  report  often  cover  immigrants,  asylum  seekers,  and  nationals  of  non-EU 
countries provided they comply with residency requirements. 

Minimum  income  schemes  do  not  act  in  isolation,  so  caution  is  needed  when  evaluating  the 
specifically  identified  support  provided  by them  in the Member  States.  They  may  complement 
some benefits,  up to  statutory  maximum amounts,  as  outlined  above.  In  addition  their  impact 
may be enhanced  by other benefits  (added  to  the  minimum  income maximum  amounts),  aid in 
kind  or  services  to  meet  specific  needs,  as  defined  in  the  Council  Recommendation  (C-l,b). 

12  In Spain ;md in France, the limits imposed are offset  by the possibility of as many renewals as necessary 
'•'  Included  in Income Support. 
14  16-17 years under restricted  conditions. 

These  additional  benefits  may  be  treated  as  rights  or  may  be  discretionary15  They  cover  needs 
relating  to  housing,  health,  education,  travel,  heating,  food,  clothing,  or  household  equipment 
(cf.Tablel). 

1-3.  Availability  for  work 

12 Member  States  require  minimum  income  recipients  to  be  available  for  work  or  training. 
Exceptions  cover  illness,  disabilities,  or caring  for young  children  or disabled  adults. 

As  provided  for  in  the  Recommendation  (B-3),  minimum  income  schemes,  except  in  France, 
require  recipients  who  are  able to  work  to  be  available to  do  so.  They  must  be  actively  looking 
for  work  and be ready to  accept  any job  which  is suitable  or  appropriate.  In  Ireland  and  the  UK 
the  availability  condition  applies 
income-based 
Jobseeker's  Allowance,  respectively.  !n  France  this  condition  does  not  apply.  To  find  a job  is 
one  of  the  options  of  the  overall  integration  process  in  which  the  "RMI" recipient  is  involved 
Two-thirds  of "RMI"  recipients  are nevertheless  registered job  seekers. 

to  Unemployment  Assistance  and 

the 

Member  States  define  exceptions  to  the  availability  requirement  quite  similarly.  Exceptions 
include  people  with  disabilities1*,  people  not  of  working  age,  and  people  in  charge  of  young 
children  or  adults  with  disabilities.  The  little  data  available  shows  wide  variations  between 
Member  States  in  the  numbers  unavailable  for  work  (33%  of  minimum  income  recipients  in 
Sweden,  87.6  %  in  Luxembourg).  This  may  relate  to  the  existence  or  otherwise  of  separate 
assistance  arrangements  for  such  categories.  People  suffering  from  long-term  illnesses  which 
prevent  them  taking  up  employment  (5% in  Germany  and  Portugal,  30%  in.Sweden)  can  also 
be  added  to  these  groups.  Also,  drugs  and  alcohol  abusers,  who  tend  to  be  over-represented 
amongst  minimum  income  recipients,  are  sometimes  considered  suitable  for  work  and 
sometimes  not. 

As  regards  family  responsibilities  and  the  education  of  children,  many  Member  States  grant  a 
temporary  exemption  from  the  availability  for  work  requirement  when  recipients  have  children 
not  yet  of school  age.  Some  Member  States  also  apply  more  flexibility  to  single-parent  families 
The  problem  of  reconciling  work  with  family  life  in this  area  is difficult.  The  approach  adopted 
may  have  a  direct  effect  on  the  lives  and  education  of  the  children  involved.  Chiidcare 
provisions  can  facilitate  access  to  work  or  training.  These  services  are  free  in  Sweden,  included 
with  the  'Toimeenlulotuki  in  Finland  and  this  facility  is  planned  for  single-parent  families  in  the 
UK.  However,  comprehensive  information  on  this  key  feature  of  developing  affordable  and 
accessible facilities  for  low  income families  still needs  to be  gathered. 

1-4. 

Social  support 

Half  the Member  States  have  set  up  social  integration  measures  often  associated 
training  and  employment. 

to  those  of 

The  Recommendation  advocates that  entitlement  to  minimum  incomes  should  be  complemented 
by economic  and  social  integration  measures  (Sections  B-3, C-4).  The  Member  States  have,  to 
varying  degrees,  taken  action  relating  to  health  treatments,  detoxification,  advice  on  family 
learning 
budgets 

(over-indebtedness),  children's  education,  mobility 

lessons), 

(driving 

'-  This supplementary  assistance  may also be provided  to people whose primary  income  is provided  from  means other than 

minimum  incomes. 
1  However,  a  number  of  Member  States  (Finland,  Sweden,  the  United  Kingdom,  Luxembourg  and  Germany)  mention 
activities developed  for people with disabilities. 

languages,  rights  and  duties  as citizens.  Employment  remains  the  ultimate  objective  for  most  of 
these  accompanying  measures. 
In  some  Member  States,  for  example  Belgium,  Spain,  and 
France, these  measures are specified  in individual  integration  contracts  (see chapter  IV) 

II -  Recent trends  in the  use  of minimum  income  schemes 

II -  /.  The relief  of  poverty 

Minimum  income  costs  are  small  compared  to  overall  social  protection  expenditures,  but,  for 
the  majority  of  their  recipients,  they  represent  the  major  source  of  income.  Their  levels  vary 
substantially  between  the Member  States. 

Minimum  income  schemes  concern  the  most  acute  situations  of lack  of  resources.  They  are  not 
intended  to  cover  all  situations  of  poverty.  Social  protection  systems  as  a  whole  give  a  wider 
response to  problems of poverty  through  the entire range of the  social  transfers  they  provide.  In 
terms  of  budgetary  expenditures17,  minimum  incomes  cost  very  little18.  However,  for  the 
majority  of recipients,  such  minimum  income  payments  remain  significant,  since they  constitute 
their  main or  only source of  income. 

Work  on  the  evaluation  of  support  provided  by  minimum  incomes  and  their  associated  benefits 
remains  incomplete  and  will  be  developed  further  in  future  reports.  Table  2  gives  an  overview 
of 
the  levels  of  support  expressed  in  purchasing  power  parities  and  covering  minimum 
incomes,  housing  benefits  and  family  allowances.  It  shows  very  wide  variations  between 
Member  States.  Housing  benefits  and  family  allowances  together  can  account  for  more  than 
half of the  assistance  provided.  For  couples  with  two  children,  family  allowances  constitute  7% 
to  28% of the  overall  support19.  This  proportion  increases  in  single-parent  families  and  reaches 
42%  in  Finland.  Housing  benefits  are  more  difficult  to  estimate  as  they  can  vary  widely  from 
region  to  region  or  from  municipality  to  municipality  within  a  single  Member  State.  They  can 
also  depend  on  the  personal  situation  of  the  recipient  when  calculated  on  the  basis  of  actual 
housing  costs. Their contribution  to the support  provided  ranges from  7 % to  over  50%. 

The  complex  interaction  of  these  mechanisms  on  household  income  may  hinder  incentives  for 
active  labour  market  measures  for  many  people  (cf  II-4.1).  This  important  policy  question  is 
raised  in the  European  Employment  Guidelines and  the national  action  plans. 

II - 2.  Who are the  beneficiaries? 

An  increasing  number  of job  seekers  and people  who have  suffered  disruptions  in  their  lives. 
Single  men  and  single-parent  families  form  a  large proportion  of  recipients20.  Certain  groups 
remain  dependent  on minimum  income for  a long  period. 

17 

"Social  Protection  in  Europe  1997  "-  Executive  summary,  COM  (1998)  243  final.  According  to  the  European 
Household  Panel,  social  transfers  in the Union  accounted  for around  30 % of net household  income  in  1993.  For  some 
35 % of households, they were the main  source of income and without them just under 40% of households  would  have 
had a level of income of under half the national  average. After  transfers, around  17 % of households  in the 1 Jnion  had ii 
level of income below this. 

IX  "Social  Protection  in  Europe  1997 "  document  of the services, April  1998,  Using  ESSPROS  data  on  "social  exclusion" 
expenditure accounts  for  1.6% of the total  EU (Greece excluded)  in  1995. Spending  on social  exclusion  was relatively 
low in most countries, zero or close to zero in the Southern  Member  States and only over  1% of GDP  in  Denmark  and 
Sweden  -  though  in  this  case  there  may be  classification  problems,  insofar  as  expenditure  on  ensuring  that  nobody's 
standard of living falls below a minimum  level can potentially be met through other elements. 

19  Children  can be taken  into account  not only with  family  allowances  which  are  included  or not  in  the  estimated  available 
income  of  minimum  income  claimants,  but  also  in  adapting  the  minimum  income  amounts  themselves.  These  two 
methods can be used in one country. 

20  Recipient = person who receives minimum income in his/her own name or as head of an eligible household. 

The  size  and  composition  of  the  population  receiving  minimum  incomes  is  influenced  by  the 
provision  of other  specific  income  support  arrangements  targeting certain  groups  which  aie  not 
considered  in this report  (cf.  1-2). Furthermore,  persons entitled  to  apply  for  a minimum  income 
do  not  always do  so. This can be  explained  by  a lack  of information,  discouragement  caused  by 
the  complexity  of the  administrative  procedures,  or  social  stigma  which  may  be  associated  with 
claiming  minimum  incomes21. 

Nonetheless,  the  number  of  minimum  income  beneficiaries  has  risen  in all  Member  States  since 
the  end  of  the  1980s22(table  3).  There  appear  to  be  two  factors  behind  this  rise.  The  first  is 
higher  and  more  persistent  unemployment.  The  second  relates  to  a  rise  in  the  numbers  who 
have  experienced  social  disruptions  in  their  lives,  e.g.  family  breakdowns,  forced  migration, 
homelessness, delinquency,  prison,  over-indebtedness. 

Compared  to  the  overall  number  of households,  two  main  groups  are  over-represented  among 
minimum  income  recipients.  These  are  people  living  alone,  mostly  men  (more  than  half  of  the 
recipients  in  all  Member  States  with  the  exception  of  Denmark  and  Spain)  and  single-parent 
families,  almost  exclusively  women  with  children  (10  to  20% of GMI  recipients,  peaking  at  35-
40%  in  some  Spanish  Autonomous  Communities).  There  is  also  a  significant  proportion  of 
young  people  among  minimum  income  recipients.  They  take  up  minimum  income  at  the  outset 
of their working  lives, in some cases even  earlier. 

In  part,  these  trends  reflect  the  deterioration  of  labour  market  opportunities  during  the  1990s 
They  are  also  linked  to  the  choices  made  in  social  policies,  especially  in  social  protection 
systems.  Couples,  with  or  without  children,  are,  for  example,  under-represented.  Reasons  for 
this can be found  in the way  social  protection  systems  cater  for  families  as well  as  in the  greater 
likelihood  that  at  least  one partner  will  have a job. 

It  is  difficult  to  assess  the  effective  duration  of  minimum  income  payments.  Few  Member 
States have  data  available,  and  the  data that  does  exist  is influenced  by the  administrative  limits 
imposed  on  the  schemes  by  the  authorities.  However,  several  Member  States  refer  to  an 
overall  increase in the average  duration  of payments  and  to  signs of long-term  insecurity  among 
certain  recipients  Approximately  10%  of  recipients  claim  minimum  income  for  several  years, 
for  example  in  France  and  Finland.  Nearly  a third  of recipients  claim  Unemployment  Assistance 
for  more than  three years  in  Ireland  This is despite  the  fact  that  minimum  income  schemes  were 
designed  as  short-term  assistance  measures  for  people  temporarily  without  financial  resources. 
The  longer  people  claim  minimum  income,  the  more  difficult  it  becomes  for  them  to  leave  the 
scheme  In the  Netherlands  it  is estimated  that  chances  of leaving  the  scheme  go  from  49%  the 
first  year  to  13% the fourth  year,  those of finding  a job from  15 to  5%. 

II - 3.  Sliding  down from  unemployment  benefit  to minimum 

income 

Restrictions  in unemployment  benefits  make  minimum  income  the only possibility  for  many 
unemployed  people. 

Beneficiary:  person  who  benefits  from  minimum  income  either  directly  or  as  a  dependent  of  a  recipient  in  the  same 

household 

21  Follow-up  reports  are  intended  to  study  a  wider  range  of  factors  linked  to  claimant  eligibility,  potential  misuse  and 

coverage of the schemes 

-2  Willi the exception  of a temporary easing-offin  I he Netherlands 

All  Member  States  have  identified  the  link  between  the  rise  in  the  level  of  unemployment  and 
the growth  in the  number  of minimum  income  recipients.  At  the  same  time  that  unemployment 
has  risen,  many  Member  States  have  shortened  periods  of  entitlement  to  unemployment 
benefits,  lowered  the  amounts  paid  or  applied  stricter  qualifying  conditions  One  third  oC 
minimum  income  recipients  are  job  seekers  in  Belgium,  Germany  and  Sweden,  two  thirds  in 
France,  86% in  Portugal  and  90% in  Ireland  (table 4). 

Minimum  incomes  may,  therefore,  supplement  unemployment  benefits  when  their  individual 
rate or the  rate  applied  to  the  household  are higher  than  unemployment  benefits.  Also,  the  latter 
applies  specifically  to  the  unemployed  person,  with  no  account  of  household23.  In  Germany 
16%  of  the  Sozialhilfe  recipients  between  21  and  65  receive  it  to  supplement  unemployment 
benefit.  Of  these,  33%  are  couples  with  children.  This  adds  to  the  complexity  of  the 
administrative  process. 

last  resort  when  entitlement 

incomes  are  also  used  as  a 

to  contributory 
Minimum 
unemployment  benefit  ends,  or  when  the  conditions  governing  eligibility  for  these  benefits  are 
not  met.  Entitlement  to  unemployment  benefit  (insurance-based)  requires  previous  employment 
with  related  social  security  contributions  over  a  minimum  period.  This  requirement  generally 
rules out 
• 
• 
• 

young  people  leaving  school, 
people  who  have been  unemployed  for  long  periods or  who  have  never  worked, 
people  who  have  been  in  part-time  employment  or  on  fixed-term  contracts  where  the 
entitlement  conditions were  not  met. 

These  groups  can,  therefore,  be  found  among  minimum  income  recipients.  Given  the  minimum 
age  requirement  also  existing  in  eight  Member  States,  some  young  people  find  themselves 
unable to  obtain  any  sort  of economic  support. 

A  number  of  Member  States,  Austria,  Germany,  Spain,  Finland,  France,  Portugal  and  Sweden 
have  an  assistance-based  unemployment  benefit  which  can  be  claimed  when  entitlement  to 
insurance-based  benefit  ceases,  generally  at  a  lower  level  and  subject  to  specific  national 
conditions.  However,  one  must  have  received  the  former  to  qualify  for  the  latter;  the  categories 
mentioned  above  are  still  not  eligible.  This can  represent  an  obstacle to job  seeking  where  those 
under  minimum  income  do  not  have  the  same  access  to  general  employment-related  measures 
as those  receiving  unemployment  benefits(cf.III-l).  Ireland,  the  UK,  Denmark  and  Luxembourg 
operate  only  two  types  of  benefits  for  those  seeking  work,  one  contribution  based,  the  other 
one  income-based.  They  both  give the  same access  to general  employment-related  measures 

An  important  side  effect  to  note  is  that  moving  from  unemployment  benefits  to  minimum 
incomes  often  implies  a  shift  in  responsibilities  from  national  budgets  to  regional  and/or  local 
budgets.  This  increases  the  pressure  on  those  local  economies  which  are  suffering  the  highest 
unemployment. 

II -  4.  Obstacles  preventing  exit from  the  schemes 

Labour  market 
difficulties  in leaving  the  schemes. 

insecurities  and  complex  benefit  arrangements  may  contribute 

to 

the 

-3  Except  in Ireland, however, where the Unemployment  Benefit  is barely higher  than  the  SWA and  in  the  UK  where the 

income-based JSA is at the same level as the income support. 

People will  be  willing  to  leave  minimum  income  schemes  when  income  from  other  benefits  or 
employment  can  be  expected  to  produce  more  than  the  maximum  amounts  set  for  minimum 
incomes. Obstacles they meet may be personal but may also be linked to the functioning  of the 
schemes. 

II -  4.1  The risk of benefit traps 

Minimum  income  may  complement  other  benefits  when  payments  made  are  lower  than  their 
maximum  amounts.  In  addition  to  the  unemployment  benefits  mentioned  above,  minimum 
incomes can  also  top  up  disability,  illness  or  retirement  benefits  (table  4). Breaking  free  from 
minimum income  schemes, therefore,  depends  on  decisions taken  in the implementation  of the 
other benefits. 

Minimum income can also operate with associated  benefits  and services which tend to 
multiply  administrative  procedures  and  eligibility  conditions.  Claimants  who,  because  of  their 
situation,  have  more  problems  in  adapting  are  less  likely  to  be  able  to  address  this 
administrative  complexity  easily.  When  they  persist  with  their  claim  it  is because  they  hope  to 
get  more  security  It  is not  surprising  that  they  then  may feel  reluctant  to  leave  such  schemes 
for employment  if the jobs offered  are insecure, and the way back to minimum income coverage 
is administratively daunting. 

Also,  minimum  income  recipients  do  not  always  get  active  support  to find jobs  and  training, 
bringing  another  disincentive  into  the  process.  Several  Member  States'  contributions  to  this 
report  show that  staff  at local level are often  over-stretched just  in the  processing  of work and 
that not enough time is available to devote to integration  and employment  measures.  All of this 
means that there is still much progress to be made in meeting the  simplification  requirement  of 
the  Recommendation  (Section  C-6),  to  make  systems more  effective,  and  to  put  into  practice 
the Member States' objective in the active social and labour market policy  field. 

U - 4.2  Finding a job  is not always enough 

livery  Member  State  has a share  of recipients  who  are  in active  employment  when  they  claim 
minimum  income.  This  is the  case for  half the  recipients  in  Sweden,  20% of whom  work  full-
time,  13% in France,  the  Netherlands  and  Finland,  8%  in  Luxembourg,  7.4%  in Germany  and 
5,3% in Portugal(table 4). This phenomenon  has not  previously been  so evident  in the Member 
States.  Its growth is also related to the increase in part-time and atypical work. 

In response to these new situations and to facilitate  the move into employment  without  income 
loss,  Member  States  are trying to  include in their  schemes various formulae,  either  permanent 
or  temporary,  for  minimum  incomes  to  supplement  wages (detail  in chap.III.3.2.2).  This  new 
flexibility may also have the effect  of increasing the number of beneficiaries. 

Ill  -  Pathways to employment 

The  "availability  for  work"  criterion  included  in  national  provisions24  has  taken  on  renewed 
significance  with the economic  and  budgetary  constraints the Member  States  have been  facing 
since the  1980s. Provisions  now  refer to being actively available, and the concept of "suitable" 
or "appropriate" jobs  has been  loosened.  However,  few  minimum  income  recipients find a job 
either  on  their  own  or  after  referral  to  general  training  and  employment  measures.  Member 

-4  Except in France. 

11 

States are seeking to  improve these  results  and better  target  the limited  resources  available on 
those who need them most. 

This section  does not  examine the employment  measures  common  to  all job  seekers, but  looks 
at  the  specific  steps  involved  in  moving  from  minimum  income  to  employment,  the  way 
Member  States  approach  this  issue  (Recommendation,  Sect.C-5)  and  the  quality  of jobs  the 
recipients can expect to obtain. 

Ill - /.  What should be expected from  the employment services? 

That they co-ordinate  their action  with  the services administering minimum  income schemes 
and cater more for their recipients than in the past. 

As the main route back  to the labour  market,  minimum  income recipients who are available  for 
work  register  with  the employment  agencies25.  In principle, this enables them  to  be treated  on 
an equal footing  with others. 

In  most  countries,  the  shift  from  unemployment  benefit  to  minimum  income  also  means  a 
change in the administration  and  delivery of benefits.  Social  services care for  minimum  income 
beneficiaries,  rather  than  employment  services.  These  services  often  operate  separately.  Social 
services  have traditionally  not  seen  their work  in terms  of addressing  unemployment,  but  have 
considered  it as only one among  many difficulties  faced  by their  clients. But,  in some Member 
States they have gradually been called upon to play an increasingly active role in this field. This 
does not mean replacing employment agencies, but undertaking specific  activities relating to the 
labour market. 

Some  Member  States,  aware  that  this  separation  may  not  be  helpful  to  the  employment 
prospects  of  minimum  income  recipients  are  attempting  to  bring  social  and  employment 
services  closer.  A first step  involves  including  recipients  in  the  target  groups  for  employment 
measures along with the long-term  unemployed  (as in Belgium,  France,  Germany,  Portugal,  for 
example).  It  is  also  de  facto  the  situation  in  Ireland  and  the  UK  where  both  groups  of job 
seekers  receive  the  same benefits.  In Germany,  up  to  20%  of  participants  in  the  employment 
support  programme  for  the  long-term  unemployed  can  be  recipients  of  the  Sozialhilfe1{\ 
Portugal  has  also  re-categorised  Rendimento minima garantido  recipients  as  a  priority  target 
group for measures financed by the European  Social Fund. 

Another  step,  more  difficult  and  longer  term,  involves  focusing  employment  services  more 
strongly  on those facing  the greatest  difficulties,  and  developing  partnerships  with  the  services 
administering  minimum  income  schemes  to  help  to  do  so.  In  Belgium,  public  social  welfare 
centres  often  work  in  partnership  with  training  and  employment  services.  France  has  put 
emphasis  on  re-channelling  the  resources  of national  employment  agencies  towards  groups  in 
greatest  difficulty.  In  Germany  a guidebook27  was  published  in  1998 by the Federal  Authority 
for  Employment  and the Federal  Union  of local authorities to  encourage  co-operation  between 
employment and social services in favour  of Sozialhilfe recipients. 

-^  Compulsory in some Member States. 
26"Aklion  Beschalligungshillen  filr Lang/eitarbeillose  1995 bis  1999",  10-02-1995 
-'  "Leitladen  fur  So/ialhiltetrager  und Arbeitsamter  zur  beruflichen  Eingliederung  Arbeitsloser",  Bundesanstall  fur  Arbeit 

und Ikmdesvereinigung der Kommunalen Spitzenverbiinde; Nurnberg/Kôln, Mârz  1998 

12 

In the Netherlands, public employment  services focus  effort  on people who are most difficult  to 
place.  People  are  identified  in  co-operation  with  the  local  authorities  in  charge  of  the  social 
services.  By 2001, public  employment  services,  social  assistance  offices  and  social  executive 
agencies  will  merge  into  « one-stop-shop »  front  offices  for  all  job  seekers  and  benefit 
claimants,  the Centres  for  Work  and  Income2*  In the  UK  Benefits  Agency  staff  are  generally 
located  with  the  Employment  services,  which  are  responsible  for  Jobseeker's  Allowance 
recipients2''  The  role  of  the  Employment  services  has  been  reinforced.  They  contract  with  a 
wide range of local partners to deliver the New Deals for job seekers. 

Greater  co-ordination  between  services  tends  to  bring  methods  more  closely  in  line  with 
objectives,  combining  standardised  administrative  approaches  with  more  personal  support  and 
counselling, as with the individual pathways to integration referred  to below (chapter IV). 

Ill - 2.  How to improve employability? 

Strong competition and lack of basic skills and competences prevent people from participating 
in general  training programmes.  Specific measures help  to  improve their  employabiliiy and 
may help to compensate for  educational and training deficiencies. 

ill-  2.1  Improving skills and competences 

Only  a  small  percentage  of  minimum  income  recipients  (table  5)  take  up  training  or  a  work 
placement.  Quite  apart  from  budget  constraints,  even  if benefit  recipients  do  have  access  to 
standard  training  measures,  they  often  lack  the  basic  skills  and  competences  to  fulfil  entry 
requirements or to take full  advantage of such training measures. 

Denmark  has  passed  the  Lov  om  Kommunal Aktivering30,  under  which  local  authorities  are 
obliged to  set up remedial  education  schemes (20% of participants  in activation  measures) and 
work  training  placements  (60%).  In the  UK,  during  the 4 month  "Gateway"  period  preceding 
the New Deal for the unemployed, help with basic skills can be provided by local partners. New 
Deal  participants  without  National  Vocational  Qualification  level  23i  can  be  offered  full-time 
education  or training for up to  12 months. Sweden has a national education and training policy, 
the  multi-annual  "Adult  Education  Initiative"  (1997-2002)  and  associated  "employability 
institutes"  (AMI).  The  compensatory  education  offered  is  however  available  in  priority  to 
people who have successfully  completed compulsory secondary education. 

However the specific training courses involved tend to be restricted,  of  short duration and with 
a low take-up rate. These problems stem not only from  budgetary  constraints but  more broadly 
from  the absence of clear strategies to address the shortcomings of national education systems 

Training can be combined with work placements, which also tend to be of short  duration. They 
are  accompanied  by  financial  compensation  for  employers  (for  example  in  Germany. 
Luxembourg,  Belgium,  France,  Denmark  and the  United  Kingdom).  Germany  has developed a 
tripartite (employee, employer,  public employment  service) integration  agreement  for  the long-
term  unemployed  incorporating  guaranteed  training,  the  costs  of  which  are  covered  by  the 

-"  SZW, ministry  of social  Affairs  and  employment, "The other  face  of the Netherlands,  about  preventing  and combating 

hidden  poverty and social exclusion'", progress report, April  1997 

-y  People with specific  social problems cans be referred  to social  services which remain  separate 
30  replaced by the Lov om Aktiv Social-politik  on 01-07-98 
3 '  follows compulsory  secondary  education 

13 

public  employment  service.  Within  the  British  New  Deal  for  young  people,  employers  sign 
quality commitments concerning in particular the training  offered. 

Ill - 2.2  Specific measures as temporary solutions 

Nine  Member  States  (Belgium,  Denmark,  Germany,  Spain,  France,  Luxembourg,  the 
Netherlands,  Portugal  and the  United  Kingdom) have set  up measures with  the ultimate  (often 
long-term) objective of reintegration into the labour market.  Most Member States reserve them 
for  recipients who  are  required  to  be available for  work.  Some Member  States  give  access  to 
them  not  only  to  those  required  to  be  available  for  work  but  also  to  some  exempted  groups 
the 
such  as  single-parent  families  or  older  recipients  (Denmark,  Luxembourg  and 
Netherlands32). France and Portugal present them as possible options for all beneficiaries. 

Ill -2.2.1  Incentives for  voluntary activities 

In  these  nine  Member  States,  activities  which  are  publicly  useful  are  proposed  as  specific 
measures  particularly  by  local  authorities,  in  sectors  such  as  public  buildings  and  amenities 
maintenance,  environmental  improvement,  services  for  local  communities  and  hospitals. 
Participants  receive  a  supplement  to  the  minimum  income  in  the  form  of  a  bonus  or 
reimbursement of expenses. 

These  measures  avoid  complete  inactivity  and  reduce  social  exclusion.  They  also  help  people 
not  capable  of easily taking on the constraints  of open  employment.  However,  these  measures 
do  not  reflect  real  labour  market  conditions  in  the  nature  of  the  work  or  the  conditions  of 
employment.  The  participants  remain  dependent  on  social  welfare  benefits  and  they  cannot 
acquire  insurance-based  social  protection  entitlements  such  as  pension  and  unemployment 
rights,  except  the  non-contributory  minima  which  exist  in  some  Member  States:  As  a  result, 
these measures  remain  of limited  use.  They  are  marginal  in France  and  they  are being  phased 
out in Germany and Luxembourg in favour of subsidised jobs in the non-profit  sector. 

Ill -2.2.2  Subsidised jobs  in the non-profit sector 

This option  is the most favoured  in those Member  States where it exists. Local  authorities are 
directly  involved  in job  creation,  particularly  in  the  social  economy  sectors,  local  and  public 
services  and  in  some  cases  are  themselves  employers.  The jobs  are  close  in  content  to  those 
described  in  section  2.2.1  but  are  better  structured  and  often  supported  by  employment 
contracts.  Social  security  contributions  are  deducted,  giving  insurance-based  social  protection 
entitlements. 

These kinds of jobs include: 
- in Spain, the empleo social, 
-  in  Belgium,  recruitment  by the  public  social  welfare  centres  of Minimex  recipients  who  are 
then made available to work for local communities or NGOs; 
- in Germany, job creation by the municipalities, particularly for  young people, under the Hilfe 
zur Arbeit programme; 
-  in  France,  the  contracts  emploi solidarité (CES33)  and  emploi  consolidé (CEC),  for  which 
RMI recipients are amongst the priority groups; 
- in Denmark, job training with public employers; 
- in Luxembourg, Affectations temporaires indemnisées, 
- in Ireland, the Community Employment Programmes; 

3-  I,one-parent  families, persons aged over 57/4, persons nol able to work  for social or medical  reasons 
- -' They cover '10% of Ihe labour market  integration  of RMI récipients.  RMI recipients represent  30% of the signed CMS. 

14 

- and in the Netherlands, the  Hanenpool (Job Pools) and Melkert experiments. 

The development  of these  measures  places  heavy  demands  on  local  authorities,  forcing  some 
Member  States  to  reconsider  the  distribution  of  funds,  staff  and  responsibilities.  On  the 
question  of financing, the  situation  differs  between  Member  States.  In  Luxembourg,  Portugal 
and  France34  budgets  are  national  but  their  management  is  decentralised.  In  Sweden  and 
Germany  the  local  authorities  have  to  foot  the  bill  for  all  the  costs  of  the  minimum  income 
schemes.  In the other  Member  States,  costs  are  shared  between  local  and  national  authorities. 
However, finance is not the only question.  A further  consideration  is whether  local  authorities 
have the staff and expertise to organise this activity  effectively. 

Most jobs offered  are of minimal  quality,  low paid,  part-time,  short-term,  with  little guarantee 
of renewal.  Few  last  more than  one year35.  People  hired  on this basis do  not  always gain  real 
work  experience  of  use  in  a  subsequent  job.  They  still  have problems finding their  way  back 
into the labour market  on any kind of permanent  basis.  In the Netherlands in  1996, 6% of those 
in subsidised employment found  a regular job,  16 % in Luxembourg in  1995. In France in 1996, 
27 % of those  entered  into  RM1 schemes had found  a job  a year  later.  44% were  on  assisted 
contracts36,  with  three-quarters  of these  having to  accept  part-time  employment  while waiting 
for a full-time  opportunity. 

Ill - 3.  Access to the labour market 

There  are few  measures for  minimum income recipients. Member  States are paying special 
attention to easing the transition to paid jobs  in order to avoid income loss. 

Ill -3.1  Access to companies 

There are various measures offering  incentives to employers. The  most  common  are grants or 
a reduction  in social  security  contributions within  a framework  of fixed-term contracts.  Most 
Member  States have made use of such  measures without  targeting  minimum  income recipients 
specifically.  Germany,  Luxembourg,  Belgium,  the  Netherlands,  France  and  the  UK  give 
incentives to employers to take on minimum income recipients. 

Measures  are  included  to  minimise  the  risk  of  employers  substituting  subsidised  workers  for 
existing  staff.  They  encourage  employers  to  keep  on  employees  after  the  subsidised  periods 
{contra/s-types  in Luxembourg,  tripartite  agreements  in Germany,  agreements  to  meet  quality 
criteria  of  the  New  Deal  options  in  the  UK,  contrats  initiative  emploi,  CIE,  in  France) 
Experience shows that employers are, on the whole, not  well disposed  to  taking on the people 
who are brought  to  them in  such  arrangements.  Yet,  particularly because  of  pre-selection by 
employers  before  they  start,  the  proportion  of  those  who  subsequently  find  a  regular job  is 
higher than with the previously-described  options. It would be useful  in future  to  evaluate  the 
quality of the jobs  offered. 

Apart  from  financial  incentives,  several  Member  States  are  trying  to  draw  on  the  social 
responsibilities  of  companies  and  employees.  Denmark  organised  a  national  and  European 
conference  on this  subject  in  199737.  In France  and  Portugal  employers  and  trade  unions  are 

-*4  Furthermore  each  Département  has  to  use  20%  of  ils  RM1  budget  for  specific  integration  measures  (on  he.illh. 

housing,...) which can complement  the subsidised  work contracts. 

• •* Kxcept  lor  instance,  Ireland  where  those  who  are  over  .15 years  and  are  difficult  to  place  can  be  offered  three  year 

contracts, and  France where CEC can be renewed for a maximal  period of five years. 

-*6 Including subsidies to companies mentioned  in section Hl-3. 
37  "A new partnership for social cohesion", Copenhagen, June  1997 

15 

brought together in local commissions for integration, designed to help create new employment 
opportunities  at  local  levels.  In  Belgium  the  public  social  welfare  centres  (CPAS)  seek 
partnerships with employers. 

A further  option  has  recently  been  opened  to  minimum  income  recipients  in  France,  Ireland, 
Spain  and  Portugal,  that  of  assistance  with  creating  one's  own job  or  setting  up  a  company. 
Specific  subsidies are also given to set up entreprises d'insertion, undertakings  which welcome 
and employ people with difficulties  who are particularly vulnerable in labour market terms. 

Ill- 3.2  Financial incentives for  returning to work 

When  comparing  net  minimum  income  replacement  rates  against  average  wages38,  the 
economic incentive to find work  is, generally preserved  in the case of people living alone. They 
account for  almost  half of minimum income recipients in the Union.  In the case of couples with 
two  children  where  only one  parent  is working,  the replacement  rates  are  significantly  higher. 
However,  replacement  rates  are  lower  in  the  case  of  both  parents  working,  which  is  a very 
common situation in the Nordic countries and is becoming increasingly commonplace in the rest 
of the Union. Replacement  rates for  single-parent  families have been  somewhat  underestimated 
as they do not take account of child-minding costs, which is a key factor when taking up a job. 

The  comparison  between  minimum  incomes  and  minimum  wages39  is  a  topic  of  debate  in 
several  Member  States.  It  would  be  useful  to  estimate  in future  the  replacement  rates  against 
the  statutory  minimum  wages40  as  there  is  a  high  probability  that  the  wages  available  to 
someone leaving minimum income schemes will be at this level. 

Ill -  3.2.1  Adjusting minimum income rates 

As  an  incentive  measure  to  stimulate job  search,  Member  States  could,  in  principle,  reduce 
minimum  income rates. They do not do  so because  the rates  are  seen  as minimum  subsistence 
levels  and  decreases  would  be  difficult  to justify.  Member  States  have,  however,  reinforced 
penalties  for  people  in  receipt  of  benefit  who  turn  down  a job  or  refuse  to  participate  in 
integration  measures.  Benefits  may  be  suspended  for  a  few  months,  and  the  suspension 
extended  in  the  event  of  a  further  refusal  (as  in  Belgium,  Spain,  France,  Luxembourg  and 
Portugal)  or the  amount  reduced  (by  20% - 25% in Denmark,  Germany,  Finland;  15, 20 then 
100 % in the Netherlands; 40% of the personal  allowance in the United  Kingdom).  It is usually 
possible  to  appeal  against  such  a  decision.  There  are  few  statistics  available  on  the  actual 
application  of penalties  (2.1%  of the  recipients  in Portugal,  2.8%  in Luxembourg,  5% of the 
signed contrats d'insertion in France). 

YU-3.2.2Smoothing the transition from  minimum income to a paid job 

To ease transition from  minimum income to a paid job,  six Member  States (Belgium,  Denmark, 
France, Germany, Ireland, the Netherlands) have transitional periods (one to three years) during 
which  minimum  income  can  be  used  wholly  or  partly41  to  top-up  wages.  Ireland  and  the 
Netherlands  do  so  with  the  aim  of  encouraging  part-time  work42.  Luxembourg  indefinitely 

3X  Or  two  third  of  these  wages,  family  and  housing  allowances  included;  table  3.4  p.35  in  "Social  benefits  and  work 

incentives"  , OI-CI),  1998 edition 
39  They exist in six Member States. 
4()  On full  time basis 
4'  Sometimes in a degressive way 
4-  NL  for (hose over 57,5 and single-parent  families  with children  under 5; 

IRL: concerns Unemployment Assistance and  Lone Parents Assistance. 

disregards earnings up to a limit of 20% of the overall guaranteed  income. Ireland  and the UK 
allow  minimum  income  to  be  claimed  by  people  working  up  to  30  and  16  hours  per  week 
respectively43.  Beyond  these limits they have opted  for  a system  of in-work  benefits  applicable 
only to families with children44. Only some Autonomous Communities in Spain  have maintained 
a strict ban on receiving minimum income and  being paid for work. 

The approach  could  be extended  to  associated  benefits,  as is the case  for  housing  support  in 
Ireland  and  the  UK.  Minimum  income recipients would  then  have  stronger  positive  incentives 
to take advantage of the possibility of employment.  As yet, few Member States follow this path, 
perhaps  because  the  complexity  of  the  process  and  allocation  of  responsibilities  at  different 
administrative levels tend to slow progress. 

The  effectiveness  of  such  measures  depends  on  ensuring  appropriate  connections  between 
labour  law,  social  protection,  training  and  active labour  market  measures  and  tax  systems.  In 
line  with  the  Commission  White  paper  on  Growth,  Competitiveness  and  Employment45, 
Member  States  have  taken  steps  to  lower  non  wage  labour  costs  for  lower  skilled  workers. 
Furthermore Member  States have now agreed  upon  a specific  Employment  Guideline46 aiming 
at reviewing and refocusing benefit  and tax systems and providing incentives for  unemployed  or 
inactive people to seek and take up work or training opportunities. 

IV. A step further;  individual pathways to integration 
Only a minority of recipients are able to leave minimum income schemes for  a paid job.  To 
achieve better results, a new approach is being developed based on  individual contracts by 
which signatories commit themselves to personal projects. 

In  the  Member  States  with  statistics  on  this  issue  (Table  5),  the  proportions  moving  off 
minimum  income  schemes  annually  ranged  from  6%  to  33  %.  Those  concerned  did  not 
necessarily find a job and where they did (13% in the Netherlands, two-thirds in France of those 
leaving the schemes), it is difficult  to assess how permanent those jobs were. 

Member  States  have begun  to  investigate  other  avenues  of  social  integration,  to  address  the 
complexity  of institutional  and  personal  barriers  to  integration  faced  by  people.  For  example, 
minimum  income  recipients  may have  difficulties  in  relation  to  family  environment,  education 
and housing, which might jeopardise their chances of finding and keeping a job. 

Social  workers,  often  the  main  point  of  contact  for  minimum  income  recipients,  observe  a 
general  difficulty  in planning  ahead  and getting  to grips  with  constantly  changing  training  and 
employment  measures.  To  remedy  this problem,  advice  and  services  have  been  developed  to 
help overcome disruptions and to enable people to operate on time scales more compatible with 
the pace of personal development. 

Tailor-made action plans are designed to facilitate  a consistent  approach  over a period  of time, 
taking into account the family  and social environment.  This may include, for  example,  seeking 

43  Under standard minimum income rules. 
44  A pilot "top-up earnings" scheme for others is on trial in the UK. In Ireland, the Back-to-Work Allowance, a three-year 
degressive support, is provided for newly-created additional jobs or for those who become self-employed.  In-work 
benefits  include housing costs. 

45  COM (93) 700 final 
46  Guideline 4 in European Employment Guidelines,  COM(98) 574 final for  1999 

17 

more social  autonomy  (language courses,  driving lessons, detoxification  treatment),  improving 
the  family  situation  (children's  education,  reducing  debts),  participating  in  local  self-help 
schemes,  improving  housing  or  training,  learning  about  rights  and  duties  as  citizens. 
Employment remains, in most cases, the final objective. 

Member States have made varying amounts of progress in this area, for example: 
- in Finland, since March  1998, compulsory individual plans for those rejecting a job  offer; 
- in Germany, the Gesamtplan provided for by the Sozialhilfe Act (§19 (4)); 
-  in Denmark,  the individuel handlingsplan which the local authorities  are obliged to  organise 
for Social Bistand recipients aged over 25; 
-  the  Dutch  weg  naar  de  arbeids  markt  for  the  long-term  unemployed  which  comprises 
agreements relating to social integration, education and training; 
-  the  British  "Jobseeker's  Agreement"  which  is a  condition  of  entitlement  for  the  JSA  and  is 
reviewed  fortnightly.  It sets out  the range of jobs which the job  seeker  is available for  and  the 
steps he/she agrees to take to find  work. 

Other Member States have developed the pathway approach as a mutual undertaking which not 
only restores to minimum income recipients responsibility for their future,  but also specifies  the 
way  the  social  and  employment  services  should  help  to  achieve  his/her  objectives.  Also,  in 
France and Portugal, these mutual undertakings formally  involve local communities represented 
within specific integration committees which co-sign the commitments. 

These  commitments  correspond  to  the  Belgian  contrat  d'intégration,  the  French  con/rat 
d'insertion, the projet d'insertion in Luxembourg, the Spanish proyecto de integraciôn and the 
Portuguese acordo de inserçâo. They are essentially seen guidelines used by social workers on 
a discretionary basis. They cover about  15 % of the recipients in Belgium, 22%» in Portugal and 
28 % in France.  These commitments are not  direct  employment  contracts.  Employment  is one 
component  among others in the overall  objective of social integration.  For instance in  Portugal 
one out of five accorda de inserçâo deals with education, health and/or social  support  and  one 
out of ten covers housing. 

V.  Perspectives,  sufficient  resources  and  assistance  as  a  starting  point  for  social  and 
economic integration 

In the  Recommendation  the Council  had  advocated  the need  "to  recognise the basic  right  of a 
person  to  sufficient  resources  and  social  assistance to live in a manner  compatible  with  human 
dignity as part  of a comprehensive  and consistent  drive to  combat  social exclusion".  Minimum 
income schemes respond to this in two ways. Firstly, they are the final safety  net mechanism of 
income  redistribution,  and  are  vital  at  times  of economic  crisis  and  increased  risk  of  poverty. 
Secondly,  owing  to  the  associated  benefits  and  services,  they  constitute  an  anchor  point  on 
which to base social and economic reintegration  of their recipients. 

The  Council  Recommendation  has  helped  to  organise  and  stimulate  the  debate  between 
Member  States.  National  schemes  are  converging  in  their  scope  and  eligibility  provisions. 
However,  notable  differences  remain  in  the  position  of  the  schemes  within  social  protection 
systems, their links with other parts of the structure of social  and employment  support,  and the 
means of their implementation,  such as guaranteed  support  levels and conditions for  associated 
benefits and services. 

For  the  poorest  people,  reintegration  into  general  (insurance-based)  social  security  systems 
often  means  going  back  to  a  regular  job.  Only  a  minority  of  minimum  income  recipients  can 
currently  expect  to  do  this.  Most jobs  offered  are  temporary  solutions.  The  borderline  between 
minimum  incomes  and  wages  is  becoming  blurred.  The  development  of  part-time  and  short-
term  jobs  has  contributed  to  this.  It  is  also  possible  that  expanding  the  scope  for  minimum 
incomes  to  top-tip  wages  help  a  wider  emergence  of  these  new  types  of  employment  On  the 
other  hand  one  might  wonder  whether  minimum  incomes  are  the  most  appropriate  instruments 
to support  people in part-time  and  low-paid  work. 

labour  market 

insecurities,  generating  sustainable  employment  opportunities 

for 
Given 
minimum  income  recipients  requires  perseverance.  Member  States  are  committed  to  this  in 
varying  degrees.  Initiatives  taken  include  job  creation  in  the  non-profit  sector,  mobilising 
employment  services  and  smoothing  the  transition  between  minimum  incomes  and  wages 
without  income  losses.  The  individual  agreements  or  contracts  implemented  in  several  Member 
States  reinforce  these  processes  by  linking  employment  to  a  wider  vision  of  social  integration, 
and by more actively  involving  minimum  income  recipients. 

To  continue  working  with  the  Member  States  with  a  view  to  improving  the  situation  of  the 
beneficiaries  of  schemes  falling  under  the  Recommendation,  the  Commission  proposes  to 
further  develop  the following  questions: 

Optimise  the  social  protection  given 
-  how  to better  cover  essential  needs  and  take  into  account  associated  benefits  (housing,  health, 
family,  etc)? 
-  can  there  be  more  consistency  between  social  minima  and  other  social  benefits,  in  particular 
those related  to  unemployment  and  retirement? 
- to what  extent  can these  schemes be used  to top  up  wages? 
-  how can the functioning  of the schemes be improved  for  the benefit  of their  users? 

Increase  the  access  to  employment 
- how can we help  recipients to better  participate  in general  training  and  employment  measures? 
-  is it necessary  to  implement  specific  measures,  if so, for  what  reasons  and  of what  type? 
-  what  are the best  ways to facilitate  the transition  to wages without  income  losses ? 
-  can  we improve the quality  of employment  offered  and  available to the  recipients ? 
These  questions  should  be  addressed 
employment  and  the national  action  plans. 

in  conjunction  with  the  European  guidelines  for 

integration 

Develop  social  and  economic 
-  what  are the rights and  responsibilities  of the  recipients  and their  dependents? 
-  how  can  co-ordinated  responses  to  the  multiple  social  and  economic  problems  faced  by  the 
recipients be  organised? 
-  what  does  the  rise  in  numbers  of  recipients  of  minimum  incomes  reveal  about  the  way  our 
social  and  economic  policies  are  working  to  promote  their  stated  objectives  of  social 
participation  and  cohesion?  What  solutions  should  we look  for  to  improve  social  inclusion? 

The  Commission  also  wishes  to  open  the  discussion  to  social  partners,  NGOs  and  other  civil 
society  organisations  as  major  stakeholders  in  social  and  economic  inclusion  policies.  The 
discussions  which  will  be  held  and  the  orientations  which  can  be  drawn  from  them  will 
contribute  to  preparing  the  implementation  of the  new  Article  118 of the  future  Treaty  (Article 
137 of the consolidated  version). 

19 

Tabic 

National  Minimum  Income  schemes,  main  associated  benefits  and  services 

Basic  scheme 

Main  associated  benefits  and  services 

Austria 

Sozialhilfe 

Belgium 

Minimexfminimum  de 
moyens  d'existence)  -
Minimum 

inkomen 

Denmark 

Social  Bistond 

Finland 

Toimeentnlotuki 

rai ice 

Revenu  Minimum 
d 'Insertion  - KM I 

Germany 

Sozialhilfe 

Ireland 

Supplementary 
Welfare  Allowance 
Unemployment 
Assistance 

Housing  benefit;  suitable accommodation  which  is  not  covered  by  the 
standard  rates of benefit  are  met by means  of additional  cash  or  non-cash 
benefits.  Illness or health  insurance. 
In  principle, Minimex  covers all  necessary  costs.  However,  one-off 
payments  may  be  issued  at  the  discretion  of local  welfare  offices.  Main 
payments  arc for  e.g.  housing  and  housing-related  costs,  medical  costs, 
utilities  arrears. 
Housing benefit.  Education  benefits  for  students  living  at  or away  from 
home. 
Housing  benefit.  The  Additional  part  of the  living  allowance'  (for  some 
discretionary  expenses)  covers especially  high  health  care  expenses  of 
public  health  services,  children's  day  care costs and  especially  high  costs 
of work-related  necessities. 
Maximum  housing  allowance  for  tenants; exemption  from  housing  lax. 
Free  medical  assistance.  Within  the  Integration  Contract,  various  means 
are put at  the disposal  of recipients. 
Housing benefit.  Health  insurance or  illness-related  expenses.  Education 
allowance;  aid  for  exceptional  cases. 
Housing  benefit.  Allowance  for  clothing  and  footwear  for  school-age 
children.  Benefits  in kind  for  bedding,  fuel  and  other  essential  household 
equipment. 

Luxembourg  Revenu  Minimum 

Housing  benefit.  Free medical  insurance. 

Garanti  -  RMG 

Netherlands  Algemene  Hijstand 

Housing benefit.  Free medical  insurance. 

Portugal 

Spain 

Rendimento  Minimo 
Garantido  (RMG) 
Renta  Minima 

Housing benefit.  Medical  costs  (for  certain  categories),  education  grants. 
subsidised  public  transport. 
Emergency  social  aid  (housing,  appliances,  furniture). 

Sweden 

Socialbidrag 

Housing benefit;  allowance  for  single-parent  families 

United 
Kingdom 

Income  Support 
Income-based  Job 
seekers  A  llowance 

Housing benefit;  denial  treatment,  subsidised  glasses,  fabric  supports, 
milk  and vitamins  for  children  <  5 and  pregnant  women,  school  meals. 
Help with  maternity  and  funeral  payments.  Cold  Weather  Payment  for 
pensioners,  disabled  ,those with  child  < 5;  local  tax  allowance. 

Minimum  income  recipients  benefit  from  general  national  provisions  relating  to healthcare,  education  and 
family  assistance.  The  above table only  states services and  allowances  over and  above  the  standard  national 
provisions.  Employment  and  training  provisions  are treated  directly  in the text  of this  report. 

References: 
-Pierre Guibentif, Denis Bouget, "Minimum  income policies in the European Union'', Lisbon  1997. 
-National answers to  1996 Commission questionnaire on Guaranteed Minimum Income. 
-European Foundation  for the improvement of living and working conditions, "Report on GMI development in EU Member 
States in  1992-1997". December  1997, Matti Heikkila, Darren  McCausland. 
-OECE), "Social Assistance in OECD countries:  country reports", 1996 

20 

Table 2 

Levels  of  Support  provided  by  Minimum  Incomes,  Family  and  Housing  benefits 

1995, expressed in purchasing power parities 

Member Slates 

A47 

B 

D 

Dk 

E48 

F 

Fin 

L 

Nl 

p50 

S 

Irl 
49 

UK 
51 

Single  - no  children 

Net overall  support 

483 

499 

661 

561 

304 

481 

644 

384 

808 

734 

221 

625 

661 

Housing  benefit 

27 

0 

36. 

9 

0 

40 

40 

0 

14 

21 

21 

7 

56 

% 

Couple - 2 children 

Ncl  overall  support 

1082 

926 

1230 

1431 

565 

858 

1266 

852 

1519 

1090 

654 

1207 

1094 

Housing  benefit 

15 

0 

29 

0 

Family  benefit 

<»/ 

% 

23 

28 

7 

11 

0 

8 

31 

20 

0 

7 

14 

10 

14 

34 

II 

14 

9 

14 

10 

10 

13 

11 

Single-parent family - 2 children 

Net overall  support 

903 

926 

895 

1007 

504 

760 

1050 

837 

145 

1006 

476 

994 

960 

Housing  benefit 

18 

0 

34 

11 

0 

35 

24 

Family  benefit 

% 

% 

28 

28 

13 

26 

10 

12 

42 

0 

9 

10 

16 

13 

18 

38 

18 

11 

13 

14 

16 

I lousing and  family  benefits  are staled as percentages of the net overall  minimum  income support; a zero % means there is 
no separate housing benefit;  it implies that the cost of housing should be covered by minimum  incomes,  figures  shown are 
net aller taxes. Benefits  are subject  to taxes (income taxes and local taxes) in Dk, L, NL and tJK. 

References: 
- figures  modelled  on (he basis of OECD database on  faxes.  Benefits  and  Incentives; 
Internet  : http://www.oecd.org/els.socpol/benefitscompendium/index.htni. 
-  Purchasing power parities-Eurostat  :  Statistics in Brief- Economy and Finance,  1995/2.  Each amount  in a national 
currency is converted to common value reference,  the PPA which makes it possible to purchase the same quantity of goods 
and services in each Member State for any one given year. 

In each family Renta Minima and Family Benefits  are taxable but none is paid by recipients as the amount of benefits 

47  Average of the 9 existing Sozialhilfe schemes (1 for each Bundesland). A very approximate amount of housing 
benefit has been included. It is not possible to estimate an actual amount because housing benefit  varies greatly  depending 
on individual  circumstances. 
48 
does not exceed Tax Credits. 
3  Housing Benefit not included as data unavailable. Relatively few Supplementary  Welfare Allowance recipients receive 
Housing Benefit.  Lone-Parent Allowance, which comprises 68%  of overall  support is taxable but none is paid  bv 
recipients as the amount does not exceed  the  Tax Free Allowance. 
50 

|(^7  ^ ( j,  [jIs(  yCar  0f  "RMG" implementation. 

• ' 
Income Support  is taxable (partly taxable  for Couple + 2 and Single + 2) but none is paid  by recipients because the 
amount does not exceed 'fax  Free Allowances.  The small amount  of tax which the table shows  to be paid  in the I !K is for 
a "local  tax".  However, this is balanced  by a local  tax benefit  which  is paid to minimum  income recipients,  therefore, 
actually no tax is paid. 

o i 

Table 3 

%  of recipients 

Persons  living 
alone  (m/f) 
Single-parent 
families  (m/f) 
Couples  with 
children 
No.  of 
recipients 
Change  since 
1990 
% 
Total 
population 
covered 

Age 
Distribution 

Characteristics of Minimum Income recipients 

B 
1997 

54 

19 

9,2 

DK 
1994 

40.6 
25.3/15.3 
11.5 
1/10.5 
32.5 

D 
1996 

51,6 

E 
1997 

22  a 30 

22,7 

35 a 40 

14 

80 020 

290 000 

1  377 945 

63 714 

+ 62 

- 16 

126 000 
(est.) 

+  11 
(/1995) 

+26 
(95 97) 

2.688 805 

186 568 

FI 
1994 

61,4 
36,9/24,5 
10,5 
1,3/9,2  • 
15,8 

339 020 
(1995) 

+  87 

584  100 
(1995) 

FR 
1996 

1997 

Irl 
SWA 

U.A. 

72.8 

L 
1994 

66,5 

NL 
1995 

57,6 

P 
1996 
9 

19,5 

23,6 

21,9 

8,2 

11,8 

s 
1994 
61.5 
39  22,5 
r;2 
1.9 15,3 
15,6 

I.S. 
59 

27 

5 

UK 

1997 

JSA 
78 

1 

15 

1010 472 

18 279 

159 777 

4622 

493 000 

89 937 

715 000 

4103000 

1097000 

+  98 

+  14 

r  604 

-7 

+  73 
(  1986) 

6  804 

283 433 

+  8 
(93 94) 

* 

27%<25 y 
51%<35v 

50% 
<  30  v 

7 3% 
< 40 v 

2/3 
< 45  v 

2/3 
< 3 0v 

7 0% 
< 3 9v 

53  % 
< 3 5v 

5 4% 
< 4 0v 

6 0% 
< 4 0v 

5 1% 
< 2 5v 

9%<  25 v 
4 3%  >60 v 

29 < 25y 
1 3 > 5 0v 

Recipients  correspond to actual households as defined within each national scheme including all possible household compositions (a single person or a recipient and dependents, children and/or 
adults of the same family).  The total population covered is generally estimated from the recipients" statements. 

R.eference : Pierre Guibentif - Denis Bouget, "Minimum Income policies in the European Union'',  1997 ; with the following additional  references: 
B : Situation on January  97;  les bénéficiaires du minimex en Belgique,  1990-1997 , Le Secrétaire d'Etat à l'intégration sociale, Jan Peeters; 
D : Situation on 31-12-96;;  Sozialhilfe Statistisches Bundesamt ; 
Dk : Susanna Brogaard and Hanne Weise:: Evaluering afLov  ont kommunal aktivering 1997: 
E  : % vary according to Spanish Autonomous Communities;  Fundacion Argentaria, 1995; 
F  :  Situation or, 31.12 96 , including overseas departments (DMO) which represent about  16% of total ; DIRMI/CAF, June 1997; 
P  : Situation on 3 j -08-98; 
ERL : Situation on 31-12-97; SWA = Supplementary Welfare Allowance; the annual flow is higher ( 73 554 recipients in 1997) ; U.A. =  Unemployment Assistance; 
L  : 3rd GMI report of the Conseil Supérieur de I action sociale  to the Chamber of Deputies, July  1996; data  FNS/CDP Dec.  1994; 
ML :  Data for recipients ranging from  18 to 64 years of age; 
UK: IS  = Income support; JSA = income-based Jobseekers allowance; Statistics Quarterly Enquiry, Nov 97; Northern Ireland: Income support  100%) census, JSA 20% sample. Data rounded to 
nearest thousand;  * Number of IS recipients increased by 36 % over period  1990/95  From October  1996, JSA replaced IS where it was paid to unemployed people. 

22 

Tabic 4 

The situation of minimum income claimants with regard to employment 

% of  total claimants 

Employment 

B 

D 

2.8 

7.4 

Job seekers 
Paid 

7 

Unpaid 
30.1 

Training 

Other 

3.8 
(students) 

14.3 

20.9 

'  5.3 

56.3 of which  10.8 family break-up,  9.6 
supplement to other  benefits, 
2.9  disability/illness 
62.1 of which  14.8 family  dependents; 7.1 
disability/illness; 1.4 retired  persons 

E 

very little 

1 xmg-term unemployed 

slight 

Single-parent  families 

Fin 

F 

lrl 

I, 

P 

S 

I II 

13 

not available 

8 

5.3 

50, of which 
20 full  time 

54.3 

Very little 

76.7 supplement  to other  benefits 

13.8 

41.2 

6 

26 

90 

31 

86.2 

10 of which 2.6 disability/illness;  1.6  refugees 

51 of which 26 disability/illness,  18 spouse at 
home, 8 over 60 years old 

5 retired persons, 2.8 disability/illness,  0.7 
support of household 

4 x national  average 

33 disability/illness 

UK 

not available 

21,1 (JSA) 

not available 

78.4 of which 34.1 retired,  19.5 single-parent 
families,  17.3 disability/illness 

nb: il is possible  for a minimum  income claimant  to receive several  other social  benefits. 

References: 
National  replies to  1997 Commission questionnaire with the following additional  references:. 
B  when claiming Minimex status; Enquête sur l'accroissement du nombre des demandes en vue de l'obtention du 
minimex. Union des villes et communes belges, section ('PAS; data for year 1994. 
D: situation on 31-12-1996 for persons  15 to 65 years old; Sozialhilfe Statistisches  Bundesamt. 
E: Ministerio de Trabajo y Asuntos sociales,  "Las rentas minimas de insercion ", origen, modelos y  aplicacion  en las 
Comunidades autonomas, 05-1997. 
F:  when claiming RMI, Isa Aldeghi, Les nouveaux arrivants au revenu minimum d'insertion,  enquête RMI  900 -  CREDOC-
D1RMI1996, CREDOC,  nov. 1996 
IRL: Supplementary Welfare Allowance + Unemployment Assistance ; Statistical  information  on Social  Welfare  Services-
Department of Social Community and Family Affairs  -  1997. 
L: situation at the time of request; Rapport d'activité  1995 du Service Nationale d'Action  Sociale 
P:  Results for the trial period  1-7-96/ 31-10-97;  17 960 households received the "RMG" during this period.  11 482  households 
still received it on 30-07-97. 
S: Reply to  1996 questionnaire, data dated  1994. 
UK: Income Support + income-based Jobseeker's Allowance (JSA), Statistics Quarterly Enquiry, Nov. 97; 
Northern  Ireland: Income support  100% census, JSA 20% sample. 

23 

Table 5 

Results achieved by socio-economic integration measures 

% of total  recipients 

"Active" 

Dk 

49 

No longer 
receiving 
min.income 
20 a  30 

employment 

Unpaid work 

Training 

Other 

15 

34 

50  in supplement to  other 
benefits 

D 

E 

Fr 

L 

Nl 

8.4 

100 
in theory 

13 
empleo social 

not available 

not 
available 

> 28 

33 

12.0 

6.0  in  96 

27 

4.7 

3.9 

32.9 

11.6 

not  available 

6 

3.5 

0.6 

0.05 proyectos  de inte-
gracion  social (healthcare, 
children's education,  ...) 
47 job seekers,  5 other 

79.5  exempt  from  MSC 

18.8 of which 4 have 
moved abroad, 4 marriages 

P 

21.8 

9.7 

21.5 

18.6,  health  ;' 23.7,  social 
support;  7.8,  housing 

« active »_= recipients who are engaged in active measures. 
Employment =  people who have found a job, assisted or unassisted 

References: 
Member States' replies to  1997 Commission questionnaire with the following additional  references: 
D :  Participants  in  Hilfe  zur  Arbeit  programme;  Breuer  Wilhem  Revenu  minimum  garanti  et  politiques 
d'insertion  sur  le  marché  de  l'emploi,  le  cas  de  l'Allemagne  ISG,  Sozialforschung  und  Gesellschaftspolitik, 
1995,  based on investigation  in  1992 
E: Ministerio de  Trahajo y  Asunlos sociales,  "Las renias ni i ni nias de insercion",  origen.  modelas y  aplicacion 
en las ( 'omunidades autonomas, 05-1997 ; l'undacion Argentaria,  "Las renias minimas de insercion en lispana: 
entre la asistencta y  la insercion. provisional  version  May  1995; data  1993 
F:  Situation  one  year  aller  their  admission  in  RMI  scheme.  28  %  "active"  =  those  having  signed  a  contrat 
d'insertion; Isa Aldeghi, Les nouveaux arrivants au revenu minimum d'insertion, enquête RMI  900 -  CREDOC-
D1RMI  1996, CREDOC, Nov.  1996 
L: On  31-12-1995: out of 7 433 recipients,  5 912 (79,5%)  were exempt  from  Mesures sociales  complémentaires 
(MSC) 56,7%  non-exempt  are. « active »; 3"'  report  of  « Conseil  supérieur  à  l'action  sociale  to  Chamber  of 
Deputies, July  1996 
NL: Data  1991. study De l'assistance nationale à l'emploi,  Social Affairs  and Employment Ministry, May  1994. 
In  1995 the activation measures concerned 27,5 % of  total recipients. 
P: Results from  period  1-7-96/31-08-98; 21,8 % "active" = those having signed an acordo de inserçao 

24 

No  1. 2 4 5 / 46 

Official  Journal  of  the  European  Communities 

26.  8.  92 

COUNCIL  RECOMMENDATION 

of  24  June  1992 

on  common  criteria  concerning  sufficient  resources  and  social  assistance  insocial  protection 
systems 

( 9 2 / 4 4 1 / E E C) 

n il  COUNCIL  Ol  LIU.  I UKOI'I  AN  COMMUNITIES, 

Having  regard 
Economic  Community,  and 
thereof. 

to  the  Treaty  establishing  the  European 
in  particular  Article  235 

Having  regard  tn  the  proposal  Ironi  the  Commission  ('). 

I l.ivii*)> 
Parliament  ( '), 

regard 

id 

ilu-  opinion 

ol 

the  European 

I lavmg  regard  to  the  opinion  ol  the  Economic  and  Social 
Committee  ( '), 

(1)  Whereas 

reinforcing 

social'  cohesion  within 

the 
Community  requires  the  encouragement  of  solidarity 
with  regard  to the least  privileged  and  most  vulnerable 
people; 

(2)  Whereas  respect 

lor  human  dignity 

is  one  of  rhe 
fundamental  rights  underlying  Community 
law,  as 
recognized  in  the  preamble  to  the  Single  European 
Act; 

( \)  Whereas  social  exclusion  processes  and 

risks  of 
poverty  have  become  more  prevalent  and  more 
diversified  over  the  last  10 years, owing  primarily  to a 
combination  of  developments  in  the  labour  market 
long-term 
with, 
unemployment,  ami  in  family  structures  with, 
in 
particular,  an  increase  in  social  isolation; 

particular, 

growth 

in 

in 

(•I)  Whereas  there  is  a  need 

lor  general  development 
policies  capable  of  contributing  towards  halting  the 
perceived  structural 
trends  to  he  accompanied  hy 
specilic,  systemic  and  coherent  integration  policies; 

(5)  Whereas, consequently,  social  policy efforts  need  to  be 
continued,  their  achievements  reinforced  and  these 
policies  adapted  to  the  multi-dimensional  nature  of 
social  exclusion,  which  involves  linking  the  various 
forms  of  immediate  assistance  needed  to  measures 
aiming  expressly 
social 
the 
integration  of  the  people  concerned. 

economic 

and 

at 

(6)  Whereas  people  with 

irregular  and 
uncertain  resources  are  unable  to  play  an  adequate 

insufficient, 

(')  Of  No  C  Iftt,  21.  h.  I'>9|.  p 
(')  OJ  No  C  I SO,  | S.  (,.  |';i>2 
(')  O)  No  C  M.  .!(>  I 

I ' W i,  ,,.  | 

I. 

part  in  the  economic  and  social  life  of  the  society  in 
which  they  live  and  to  become  successfully  integrated 
economically  and  socially;  whereas  the  right  of  the 
reliable 
least  privileged 
resources  should  therefore  be  recognized  as  part  of  a 
consistent,  overall 
their 
integration; 

to  sufficient, 

stable  and 

supporting 

policy 

for 

(7)  Whereas  on  29  September  1989  the  Council J nd  the 
Ministers for  Social  Affairs  meeting within  the  Council 
adopted  a resolution  on  combating  social  exclusion  (') 
which  stressed  that  combating  social  exclusion  may  be 
regarded  as  an  important  part  of  the  social  dimension 
of  the  internal  market; 

(8)  Whereas  the  Community  Charter  of  the  Fundamental 
Social  Rights  of  Workers,  adopted  at  the  European 
Council  in  Strasbourg  on  9  December  1989  by  the 
Heads  of  State  or  Government  of  11  Member  States, 
states,  inter  alia,  in  its  eighth  recital  and  in  points  10 
and  25: 

'Whereas,  (.  .  .) in  a  spirit  of  solidarity,  it  is  important 
to  combat  social  exclusion;' 

'According  to 
country: 

the  arrangements  applying 

in  each 

10.  Every  worker  of  the  European  Community  shall 
have  a  right  to  adequate  social  protection  and 
shall,  whatever  his  status  and  whatever  the  si/e 
of  the  undertaking  in  which  he  is  employed, 
enjoy  an  adequate 
security 
benefits. 

level  of  social 

Person  who  have  been  unable  either  to  enter  or 
re-enter  the  labour  market  and  have  no  means of 
subsistence  must  be  able  to  receive  sufficient 
resources  and  social  assistance  in  keeping  with 
their  particular  situation.' 

'2.5.  Any  person  who  has  reached  retirement  age  but 
who  is not  entitled  to  a  pension  or  who  does  not 
have other means of subsistence, must  be entitled 
to  sufficient  resources  and  to  medical  and  social 
assistance  specifically  suited  to  his  needs.'; 

('')" OJ  No  (."277,  31.  10.'198"».  p.  1. 

'2JT 

26.  8.  92 

Official  Journal  of  the  European  Communities 

No  E  2-IS/47 

(9)  Whereas 

has 

included 

the  Commission 

this 
fundamental  aspect of the fight  against  social  exclusion 
in its action  programme  relating to the  implementation 
of  the  Community  Charter  of  the  Fundamental  Social 
Rights of Workers, while  noting  in particular  the  value 
of  a  Community  initiative,  in  a  spirit  of  solidarity,  to 
assist  the  least  privileged  citizens  of  the  Community, 
including  the  elderly,  whose  situation  all  too  often 
resembles  that  of  persons  excluded  from  the  labour 
market; 

(10)  Whereas 

the 

implementation  of  a  guarantee  of 
resources and  social  assistance comes within  the  sphere 
of social  protection;  wheseas  it is for  Member  States  to 
define,  in  this  connection,  the  legal  nature  of  the 
provisions  intended  to  ensure  this  guarantee,  which  in 
most  Member  States  do  not  come  within  the  sphere  of 
social  security; 

I I)  Whcic.i'.  H  r.  i m p o r t a i )!  lo  t a ke  a c i o t mi  ( h i r i ng 

t he 

progressive implementation  of  this recommendation  of 
the  availability  of  financial  resources,  of  national 
priorities  and  of  balances  within  national  social 
protection  systems;  whereas  there  are  disparities  in 
development  between  Member  States  as  regards  social 
protection; 

( 1 2)  Whereas,  in  its resolution  on  combating  poverty  in  the 
European  Community  (').  the  European  Parliament 
declared 
the 
Member  States  a guaranteed  minimum  income  to  help 
ensure  that  the  poorest  citizens  are  integrated 
into 
society; 

itself  in  favour  of  establishing  in  all 

Economic 

(13)  Whereas,  in  its opinion  on  poverty  of  12 July  i 989  (*), 
the 
also 
recommended  the  introduction  of  a  minimum  social 
income,  both  to  act  as  a  safety  net  for  the  poor  and  to 
boost  their  reintegration  into  society; 

Committee 

Social 

and 

exclusion,  and 
their  social  protection 
systems,  as  necessary,  according  to  the  principles 
and  guidelines  set  out  below, 

to  adapt 

B. 

to  recognize  this  right  according  to  the  following 
general  principles: 

1. 

it  is  to  be  a  right  based  on  respect  for  human 
dignity; 

the  scope  of  that  right  is  to  be  defined  vis-a-uts 
individuals,  having  regard  to  legal  residence  and 
nationality, 
the  relevant 
in  accordance  with 
the  aim  of 
residence,  wirh 
provisions  on 
progressively  covering  all exclusion  situations  in 
in 
that  connection  as  broadly  as  possible, 
accordance  with  detailed  arrangements 
laid 
down  by  the  Member  States; 

I.  every  person  who  does  not  have 

access 
individually  or  within  the  household  in which  he 
or  she  lives  to  sufficient  resources  is  to  have 
access  to  such  right: 

—  subject  to  active  availability  for  work  or  for 
vocational  training  with  a  view  to  obtaining 
work  in  the case of  those  persons  whose  age, 
family  situation  permit  such 
health  and 
active  availability,  or,  where  appropriate, 
subject  to  economic  and  social  integration 
measures  in  the  case  of  other  persons,  and 

—  without  prejudice 

to  the  Member  States' 
option  of  not  extending  this  right  to  persons 
in  full-time  employment  or  to  students; 

4.  access 

to 

is  not 

to  be  subject 
compliance  with 

limits, 
eligibility 
assuming 
conditions  and  on  the  understanding  that,  in 
practice, the  right  may  be granted  for  limited  but 
renewable  periods; 

time 

the 

( 14)  Whereas this  recommendation  does  not  affect  national 

and  Community  provisions  on  right  of  residence; 

(15)  Whereas 

the  Treaty  does  not, 

the 
attainment  of  these  objectives,  provide  for  any  means 
of  action  other  than  those  laid  down  in  Article  235, 

in  respect  of 

I.  HEREBY  RECOMMENDS  MEMBER  STATES: 

A. 

to  recognize  the  basic  right  of  a  person  to  sufficient 
resources  and  social  assistance  to  live  in  a  manner 
compatible  with  human  dignity  as  part  of  a 
comprehensive  and  consistent  drive  to combat  social 

C. 

5. 

6. 

the  right  is  auxiliary  in  relation  to  other  social 
rights.  An  effort  should  be  made  in  parallel  to 
reintegrate  the poorest  people into the systems of 
general  rights; 

it  is to  be accompanied  by  those  policies  deemed 
necessary,  at  national  level,  for  the  economic 
and  social  integration  of  those concerned,  as  laid 
down  in  the  resolution  of  the  Council  and  of  the 
Ministers  for  Social  Affairs,  meeting  within  the 
Council,  of  29  September  1989  on  combating 
social  exclusion; 

to  organize 
according  to  the  following  practical  guidelines: 

implementation  of 

this 

the 

right 

(')  OJ  No C 262,  10.  10.  1989,  p.  194. 
(')  OJ  No C 221,  28. H.  1989,  p.  10. 

I. 

(a) 

fixing  the  amount  of  resources  considered 
sufficient 
to  cover  essential  needs  with 
regard  to  respect  for  human  dignity,  taking 

'£6 

No  L  2 4 5 / 48 

Official  Journal  of  the  European  Communities 

26.  8.  92 

account  of  living  standards  and  price  levels 
for 
the  Member  State  concerned, 
in 
different  types  and  sizes  of  household; 

(b)  adjusting  or  supplementing  amounts  to 

meet  specific  needs; 

(c) 

such 

indicators, 

in  order  to  fix  the  amounts,  referring  to 
appropriate 
for 
example,  statistical  data  on  the  average 
disposable  income  in  the  Member  State, 
statistical  data  on  household  consumption, 
the legal  minimum  wage  if  this exists or  the 
level  of  prices; 

as, 

(d)  safeguarding 

an 

seek 
employment  for  persons  whose  age  and 
condition  render  them  fit  for  work; 

incentive 

to 

(e)  establishing  arrangements 

for  periodic 
review  of  these  amounts,  based  on  these 
indicators,  in  order  that  needs  continue  to 
be  covered; 

I.  granting,  to people  whose  resources taken  at  the 
level of  the individual  or the household  arc  lower 
than  the  amounts 
fixed,  adjusted  or 
thus 
supplemented,  differential  financial  aid  to  bring 
them  up  to  these  amounts; 

the 

implementation  of 

taking  the  necessary  measures  to  ensure  that, 
with  regard to the extent of the financial  support 
thus  granted, 
the 
regulations in force  in the areas of  taxation,  civil 
obligations  and  social  security  takes  account  of 
the  desirable  level  of  sufficient  resources  and 
social  assistance  to  live  in  a manner  compatible 
with  human  dignity; 

4. 

receive 

appropriate 

taking every  measure  to enable  those  concerned 
to 
support, 
conio  ><ng  measures  and  services  such  as,  in 
par:.oilar,  advice  and  counselling,  information 
au J  at i»'.i  nice  in  obtaining  their  rights; 

social 

5.  adopting  arrangements  in  respect  of  persons 
whose  age  and  condition  render  them  fit  for 
work,  which  will  ensure  they  receive  effective 
help  to  enter  or  re-enter  working  life,  including 
training  where  appropriate; 

6. 

taking the  necessary  measures to  ensure  that  the 
least  privileged  are  informed  of  this  right; 

simplifying  as  far  as  possible  the  administrative 
procedures  and  arrangements  for  examining 
means  and  situations  involved  in  claiming  this 
right; 

in  so 

far  as  possible  and 

in 
organizing, 
the 
accordance  with  national  provisions, 
machinery  for  appeals  to  independent  third 
parties,  such  as  tribunals,  to  which  the  persons 
concerned  should  have  easy  access: 

D. 

to guarantee  these  resources  and benefits  within  the 
framework  of  social  protection  arrangements; 

to  determine  detailed  arrangements,  finance  costs 
and 
and 
organize 
in  accordance  with  national 
implementation 
legislation  and/or  practice; 

administration 

their 

E. 

implement  the  measures 

to 
in  this 
recommendation  progressively  as  from  now  in  such 
a  way  that  a  report  can  be  drawn  up  after  five 
years, 

laid  down 

—  taking  into  account  economic  and  budgetary 
resources  as well  as the  priorities  set  by  national 
authorities  and  balances within  social  protection 
systems,  and 

—  where 

appropriate, 

varying 

their 

scope 

according  to  age  group  or  family  situation; 

F. 

to  take  appropriate  measures: 

—•  to  collect 

information  systematically  on  the 
actual  arrangements for  access to these  measures 
for  the  people  concerned,  and 

—  to  carry  out  a  methodical  evaluation  of  their 

implementation  and  impact; 

II  AND  THEREFORE  ASKS THE  COMMISSION: 

1. 

2. 

in  liaison  with  the 
to  encourage  and  organize, 
Member  States, 
exchange  of 
information  and  experiences  and  the  continuous 
evaluation  of  the  national  provisions  adopted; 

systematic 

the 

to  submit  to  the  European  Parliament,  the  Council 
and  the  Economic  and  Social  Committee,  on  a 
regular  basis, reports  based  on  information  supplied 
by  the  Member  States  describing  the  progress 
achieved  and obstacles  encountered  in  implementing 
this  recommendation. 

Done  at  Luxembourg,  24.  6.  1992. 

for  the  Council 

The  President 

José  da SILVA  PENEDA 

•«•«asrf 

'fâf-

ISSN 0254-1475 

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DOCUMENTS 

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05  04  01  17 

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