How would the abolition of the child increase and the exempt amount affect the daily allowance?
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- Income security
- Law change
The abolition of the child increase will reduce the amount of the daily allowance for families. The abolition of the exempt amount will affect part-time workers, but will not affect the completely unemployed.
Several changes to unemployment benefits have been agreed in the government programme. The forthcoming legislative changes will bring a wide range of tightening to the conditions and level of support for those in receipt of income support. The changes mentioned in this news item are likely to enter into force on 1.1.2024.
The timing of the changes will depend on the actions of the government and parliament, so we do not yet know for sure when the conditions of income support will change. As a general rule, the changes will only affect benefits granted after the changes to the law.
Abolition of the child increase cuts daily allowance for families
If you have a dependent child under the age of 18, your daily allowance is currently paid at a higher rate.
The increase is 7.01 € for one child, 10.29 € for two children and 13.26 € for three or more children per day. The total increase for children is therefore currently around 150 € -300 € per month. This increase will be completely abolished if the government programme is implemented.
The government programme states that the abolition of the child supplement will be compensated elsewhere, but the cut in the daily allowance will be felt immediately.
Removal of the exempt amount reduces the daily allowance for part-time workers
If you have an income from part-time work or a side business, you can earn up to 300 € per month without affecting the amount of the daily allowance. After that, every euro you earn will reduce the amount of the daily allowance payable by 50 cents.
As agreed in the government programme, this exempt amount will be abolished. The abolition of this protection means that every euro paid to you will reduce your daily earnings allowance by 50 cents.
The abolition of the exempt amount will only affect you if you have income from part-time work or from a side business. In the example below, the deduction of the exempt amount reduces the daily allowance by 139,40 € (889,20 € to 749,80 €).
Example 1: With the exempt amount
Salary for part-time work 1300 €, full daily allowance 67,72 €, exempt amount 300 €, 20 compensation days per application period
Salary paid: 1 300,00 €
Reduce exempt amount: 1 300,00 € – 300,00 € = 1 000,00 €
Divide by 2: 1 000,00 € / 2 = 500,00 €
Divide by 21,5: 500,00 € / 21,5 days = 23,26 €/day
Reduced from entire amount: 67,72 €/day – 23,26 €/day = 44,46 €/day
Adjusted daily allowance: 44,46 €/day
Adjusted daily allowance during application period: 44,46 €/day x 20 days = 889,20 €
Example 2: Without the exempt amount
Salary paid: 1 300,00 €
Divide by 2: 1 300,00 € / 2 = 650,00 €
Divide by 21,5: 650,00 € / 21,5 days = 30,23 €/day
Reduced from entire amount: 67,72 €/day – 30,23 €/day = 37,49 €/day
Adjusted daily allowance: 37,49 €/day
Adjusted daily allowance during application period: 37,49 €/day x 20 days = 749,80 €