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Cyprus

Revised welfare aid bill heads for House

Labour Minister Zeta Emilianidou

By Angelos Anastasiou

THE Minimum Guaranteed Income (MGI) scheme bill was approved by the Council of Ministers yesterday and is expected to be voted on by the House in today’s plenary session.

According to the proposed bill, all social welfare benefits – with the exception of allowances to the handicapped, single-parent families, student and refugee aid, as well as child support – will be replaced by a single social welfare item that will be based on key criteria, including income, bank deposits, value of property owned, and number of dependents. Applicants with bank deposits exceeding €5,000 – the amount increasing by €1,000 for each dependent – will be disqualified, as will owners of immovable property valued at €100,000 or more.

“An amendment was agreed by the Council of Ministers,” Labour minister Zeta Emilianidou told the press. “Our decision was that eligibility will be capped at homes owned by individuals at 150 square metres, and by families at 300 sq.m., and the cap aims to ensure that only those in real need are included.”

According to Emilianidou, the minimum amount for the MGI has been set at €480, but by no means would this be limited for those who can prove additional needs.

“Add to that rent, or in the case of home ownership interest to on loans, plus municipal and other fees – so, €480 is for a person living alone,” she said, adding that rent will be calculated on the going rate in each of the five districts.

“For a family, in addition to the applicant, the spouse will carry an entitlement of 50 per cent on the €480 – so €240 more – for children under 14 an additional 30 per cent each – €144 – and for children over 14, 50 per cent – €240.” Dependent children were defined as unwed children up to the age of 28.

The Labour ministry said that the aim is to have the scheme up and running by July 1, which is contingent upon certain articles of the law – allowing for the submission of applications – being passed by this week’s plenum. But opposition deputies have already complained that the government has left them with too little time to study the law before voting on it.

Additionally, a bigger question looms in light of the government’s plans. As the government expects a flurry of 70,000 MGI applications – the current social welfare list numbers some 11,500 – it was estimated that social welfare expenditure will need to be increased by €25m for the rest of 2014, and €50m for the entire year. Emilianidou dismissed concerns of any additional taxation to cover the cost.

“These funds have already been secured,” she told state radio. “The item is in the government’s budget.”

But opposition parties insist that the measure will only partially address the people in need. On the contrary, Emilianidou argued.
“This scheme differs to the old state of affairs in many respects, most importantly in that for the first time low-income earners who work a few hours become eligible,” she said, adding that their number is estimated at 10,000. “Also, every pensioner that fulfils the criteria laid out by the law will be included.”

The Labour Minister noted that previous legislation excluded anyone who owned property valued at €20,000 from social welfare, whereas the MGI bill allows individuals with property valued up to €100,000 to receive welfare.

Meanwhile, the Council of Ministers also decided to establishment of an Independent Agency for Social Support, tasked with providing financial assistance of financially struggling individuals whose education is found at risk due to social or other circumstances.

The agency will be headed by the First Lady. The Accountant General will serve as the agency’s treasurer, and the permanent undersecretaries of the Labour, Education and Health ministries will sit on its board as members. The Auditor General will audit the agency’s books.

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