Social Security 2030 – alternatives
The alternatives prepared in the Toimi project differ from each other but they are internally consistent. The alternatives represent basic choices and strategies towards the objectives in support of the reform. In the alternatives the focus is on the basic choices and a system constructed upon these, without detailed specification of all benefits or groups of beneficiaries. The levels of the benefits will be established as part of the decision-making for each government term.
The alternative stresses the simplification of the social security system and responsibility of families. The alternative gives a more prominent role to families in securing the subsistence of an individual and targets assistance to people with low incomes through means testing. Participation in measures that promote employment and rehabilitation constitute the right to a higher level of security.
Social security is simplified by combining cause-related basic benefits and the basic component of income support of working-age people who are able to work into one single benefit that is decreased based on the incomes of the whole household: Individual “security guarantee” but one that takes households’ incomes into account increases the responsibility within families and targets assistance to people with low incomes, securing what is indispensable.
This security guarantee has two levels according to whether the individual has access to measures to promote employability and rehabilitation. If this is not the case, a lower level is applied. For example, a lower level of security applies to students and those caring for small children at home.
Pension guarantee is the same as it is now.
Housing assistance and compensation for housing costs in social assistance are combined into single, household-specific assistance for housing. Maximum housing costs are considered by travel-to-work areas. Combining the two forms of assistance for housing means that no compensation for housing costs is payable under social assistance, except under special circumstances.
The compensations that remain to be covered by social assistance are combined into a last-resort social assistance subject to means testing by social work.
The simplified scheme cannot react on a case-by-case basis, but consideration of individual circumstances is addressed by services.
Basic alternatives in a nutshell
Relation between conditionality and unconditionality:
The lower level benefit is a subjective right in the same way as the present reduced basic amount, but household-specific means testing is applied. The higher level benefit is subject to the obligation to participate in measures that promote employment and rehabilitation. Assistance for housing remains unconditional.
Relationship between universal and cause-related security:
Cause-related security. Means testing is used much more in social assistance and the benefits of many basic assistance beneficiaries living with a spouse who is employed decrease or cease altogether.
Relation between family-specific and individual security:
The right to basic social assistance is secured based on families in the same way as is now being done for social assistance. Assistance to housing is household-specific.
The alternative stresses the coordination of services and benefits to increase the incentive effect and participation. The aim is to enable and encourage the building of competence and skills, maintaining and restoring work ability and seeking employment, and to prevent exclusion. In preventing growth in social inequality the focus is on correctly timed services.
This alternative demands that beneficiaries’ needs for services are assessed and correctly timed services are provided to the customers. A prolonged need for social security is prevented by services that make an impact at an earlier stage than at present.
Making use of the services entitles to individual and higher level of assistance. For the unemployed the higher level of assistance requires participation in measures in support of employment, work ability review or assessment of the need for re-education or re-skilling and, where necessary, participation in such education or skilling. The level of assistance is higher for sickness daily allowance and parental daily allowance beneficiaries.
Persons who do not make use of the services are eligible for the individual but lower assistance where households’ incomes are taken into account, corresponding to the present basic amount of social assistance. The same applies to persons caring for children at home. Students are eligible for the lower assistance, but household’s incomes are not taken into account.
Housing assistance and compensation for housing costs in social assistance are combined into single, household-specific assistance for housing. Maximum housing costs are considered by travel-to-work areas. Combining the two forms of assistance for housing means that no compensation for housing costs is payable under social assistance, except under special circumstances.
The compensations that remain to be covered by social assistance are combined into last-resort social assistance subject to means testing by social work.
Maintaining competence and skills is ensured in a more harmonised and comprehensive manner than at present, in line with the principles of lifelong learning. Focus is on acquiring and maintaining competences and skills needed in working life all through the lifetime.
Basic alternatives in a nutshell
Relation between conditionality and unconditionality:
The lower-level benefit is a subjective right in the same way as the present reduced basic amount, but household-specific means testing is applied. Higher-level social security involves more obligations than at present and there is a closer relation between benefits and services. Assistance for housing remains unconditional.
Relationship between universal and cause-related security:
Universal right to education and support services associated with this, in other respects mainly cause-related.
Relation between family-specific and individual security:
Does not change the relation between family-specific and individual security: cause-related security remains individual, last-resort security is family-specific and subject to means testing.
Absolute right to individual, unconditional security as the premise. Services are not an obligation but they are being offered. Freedom of choice enables new forms of activity and work and social participation for the people.
Basic security benefit replaces the present basic security benefits (sickness daily allowance, parental daily allowance, rehabilitation daily allowance, unemployment benefits, child home care allowance, study grant) and basic social assistance. Every working-age person 18 years of age or older residing legally in Finland is eligible for the benefit.
Right of access to all healthcare and social welfare services remains unchanged. Earned or other income does not reduce the benefit without earnings disregard by a certain reduction percentage. The benefit does not contribute towards pensions.
Housing assistance and compensation for housing costs in social assistance are combined into single, household-specific assistance for housing. Maximum housing costs are considered by travel-to-work areas. Combining the two forms of assistance for housing means that no compensation for housing costs is payable under social assistance, except under special circumstances.
The compensations that remain to be covered by social assistance are combined into a last-resort social assistance subject to means testing by social work.
Basic alternatives in a nutshell
Relation between conditionality and unconditionality:
Basic security is unconditional.
Relationship between universal and cause-related security:
Universal assistance that involves individual consideration of incomes.
Relation between family-specific and individual security:
Individual right to security, for housing assistance household-specific.