Analysis of Minimum Income Schemes in EU Member States

A research study by the Anti-Poverty Forum Malta as part of the European Minimum Income Network

Minimum income schemes in Malta, albeit providing reasonably well resources against absolute poverty, do not provide enough for a dignified standard of living. This has been concluded from a research study commissioned by Anti-Poverty Forum Malta.  Speaking during the launch of the research findings, researcher Mr Leonid Mc Kay on behalf of Anti-Poverty Forum Malta (APF Malta), explained that the research investigated the adequacy, coverage and take-up of non-contributory benefits in Malta with a particular focus on the Social Assistance benefit. The underlying philosophy is that minimum income schemes should guarantee an income that is indispensable to live a life in dignity and to fully participate in society.

APF Malta Chairperson Saviour Grima stated that the research is essential for Malta to have a clear picture on Social Assistance benefits and to shed a light on the different realities some people are experiencing.  Grima presented a number of case studies to portray these realities.

This research study forms part of an EU roadmap towards progressive realisation of adequate and accessible Minimum Income Schemes.  The European Minimum Income Network (EMIN) is a two-year project funded by the European Commission, aiming at building consensus to take the necessary steps towards the progressive realisation of adequate and accessible minimum income schemes in EU Member States, in line with the European Commission’s Active Inclusion Recommendation of 2008, the Europe 2020 strategy and in the context of the European Platform against Poverty and Social Exclusion.

During the last months, European Member States analysed Minimum Income Schemes in their respective countries, studied current trends and obstacles and proposed improvements on such schemes. The final aim of this research is to raise awareness and present suggestions for enhancing EU level coordination in the field of Minimum Income Schemes, including the proposal for common EU level definition and criteria for adequate Minimum Income Schemes.

For the purpose of this research study, minimum income schemes are defined as essentially income support schemes which provide a safety net for those who cannot work or access a decent job, and are not eligible for social insurance payments or those whose entitlements to these have expired. It focuses on the non-contributory (financial means tested) benefits regulated by the Social Security Act (Cap 318 of the Laws of Malta).

This research study compares two particular minimum income schemes (Social Assistance (SA) and Single Unmarried Parents (SUP) with (i) the minimum budget for a decent living as per Caritas Malta’s study and (ii) with the at-risk-of-poverty threshold. It acknowledges that minimum income schemes in Malta have an important role in the fight against poverty.

This study reveals that minimum income schemes albeit they provide reasonably well resources against absolute poverty, they do not provide enough for a decent standard of living particularly where the household is living in a commercially rented dwelling. It also reveals that the total income per annum for beneficiaries of both SA and SUP is below the 60 per cent of the national equivalised income.

This report closes by identifying the different obstacles to the implementation of adequate and accessible minimum income schemes. It concludes that too much focus is put on activation measures and welfare fraud in the current employment reforms at the expense of those who cannot participate in the labour market. The geographical concentration of welfare beneficiaries perpetuates the intergenerational transmission of poverty. It looks at the benefit trap and states that the difference between social welfare benefits and the minimum wage in Malta is not enough to encourage welfare beneficiaries to seek formal employment. Finally, it also notes that there are a number of obstacles faced by two particular groups (amongst others) in terms of minimum income schemes particularly migrants living in Malta and persons with mental health difficulties.

Present for this conference was Mr Fintan Farrell Project Manager for the EMIN within the European Anti-Poverty Network (EAPN) and Ms Audry Deane from EAPN Ireland.

The European Anti-Poverty Network (EAPN) is the largest European network of national, regional and local networks, involving anti-poverty NGOs and grassroots groups as well as European Organisations, active in the fight against poverty and social exclusion. It was established in 1990 and funded by the European Commission.

Anti-Poverty Forum Malta is affiliated with the EAPN and is also a member of EAPN’s Executive Committee.  APF Malta is a network of 13 organisations working together as a network on poverty. The Forum organises a number of conferences, seminars and focus groups, promotes research, disseminates information and creates awareness on poverty and social exclusion in Malta.  As a network, APF Malta’s mission is to coordinate and support organisations working in the interests of persons suffering poverty and social exclusion.  Most of APF members are in constant touch with poverty and social exclusion, thus bringing to this platform a wealth of knowledge on poverty in Malta.

The European Minimum Income Network national conference was organised by Anti-Poverty Forum Malta on Tuesday 14th October 2014 at Dar l-Ewropa in Valletta.