SHARE
COPY LINK

BENEFITS

Sickness benefits claims break agency’s budget

Unexpectedly high sickness benefits claims have forced Sweden's social insurance agency to beg the government for an additional 2.5 billion kronor ($368 million) to ensure sick Swedes get paid while home from work.

Sickness benefits claims break agency's budget

“It’s been hard for us to foresee this increase,” Ulla Östman Krantz, an analyst at Sweden’s National Social Insurance Agency (Försäkringskassan) told the Dagens Nyheter (DN) newspaper.

“It’s a serious matter that sickness benefits claims are on the rise again and we don’t really know what lies behind it.”

The agency had been allotted 19 billion kronor in 2012 to cover the costs of sickness benefits claims (sjukpenning), but according to an updated forecast carried out in October, the agency is set to face claims for the year totalling 21.5 billion kronor.

In Sweden, employers are expected to provide sick pay at 80 percent of workers’ salaries for the first two weeks of illness, after an initial qualifying day (karensdag) which is unpaid.

If workers are home due to illness for more than two weeks, the social insurance agency then starts paying the benefits, up to a maximum of 364 days within a 15-month period.

Following the October forecast, the agency, which is charged with delivering a variety of payments associated with Sweden’s elaborate social safety net, has gone to the government to ask for permission to overspend its budget by 2.5 billion kronor.

“We have to continue paying out sickness benefits, even if we really don’t have the money,” said Östman Krantz.

The Social Affairs Ministry has indicated it plans to consider the request quickly and ensure that agency can cover the benefits requests.

There are also plans to increase the agency’s budget for 2013.

TT/The Local/dl

Follow The Local on Twitter

Member comments

Log in here to leave a comment.
Become a Member to leave a comment.

TAX

How Germany plans to increase child benefits and provide tax relief

Germany's governing coalition has agreed to increase child benefits (Kindergeld) and offer tax relief. Here's what you need to know.

How Germany plans to increase child benefits and provide tax relief
Photo: DPA

The cabinet of the coalition government, made up of Angela Merkel's Christian Democrats and the centre-left Social Democrats (SPD) agreed Wednesday to increase child benefit – or Kindergeld – by €15 per month next year.

The move is part of the Family Relief Act (Familienentlastungsgesetz), which aims to take the financial burden off middle and lower class families. It's part of an overall package which is setting the federal government back €9.8 billion over 2019 and 2020.

The child benefit is to rise to €219 per month on January 1st 2021 for the first and second child, to €225 per month for the third child, and to €250 from the fourth child onwards.

According to the bill, families will also receive tax relief. for example, the tax-free child allowance (Kinderfreibetrag) is to be raised by more than €500 to €8,388.

In total, families would be relieved of around €12 billion per year, said Finance Minister Olaf Scholz of the centre-left Social Democrats (SPD).

“This is good news for all families and children in Germany,” he said.

READ ALSO: Kindergeld – what you need to know about Germany's child support payments

 

Families are also set to benefit from a cash boost due to the coronavirus pandemic.

The planned Kinderbonus of €300 per child is to be transferred in two instalments of €150 each in September this year, and October. It will be paid to parents alongside Kindergeld.

Explained: How does Germany's Kinderbonus coronavirus payment work?

Boost for taxpayers

Meanwhile, all taxpayers in Germany are to receive a boost. The basic tax-free allowance will be increased from €9,408 to €9,696 from next year.

Meanwhile, the limit, from which the highest tax rate of 42 percent must be paid, will rise from €57,052 to an annual income of €57,919. A further increase of the income limits is planned for 2022.

However, all changes agreed by the cabinet must still be approved by the Bundestag and Bundesrat before they can come into force.

READ ALSO: Here's how Germany plans to reform 'Elterngeld' for new parents

SHOW COMMENTS