On November 11, Latvian Saeima’s Budget and Finance Committee supported for the final reading amendments to the Law on Social Security that provided for defining minimal income thresholds, their lowest volumes and the frequency of their review.
The legislative draft has been included in the state budget legislative package.
The legislative draft currently states that the minimal income volume for a single person or single-person household is support provided for social security. Amounts are decided by relative regulations on social services. The legislative draft states that the minimal income threshold should not be below EUR 109.
This will outline the lowest possible income threshold, at which residents with low income will be provided support from public resources, as the annotation to the legislative project states. It is expected the minimal income threshold will be reviewed at least once every three years.
Welfare Ministry notes that the review of minimal income threshold will have a positive effect for more than 140,000 residents with low and very low income.
Guarantees minimal income for first or only person in a household will be set at EUR 109 starting next year. For every next person in a household it will be EUR 76 a month. For poor households the minimal income amount for the first and only person in a household is planned at EUR 272 (EUR 190 for every next person).
State social security support for persons of pension age, but who do not have the right for old age pension, as well as persons with disability, is planned to be at EUR 109 (EUR 136 for persons suffering from disability from childhood). For persons of the first disability group the state social security amount will be applied with coefficient of 1.4, whereas persons of the second disability will be applied with coefficient of 1.2.
Minimal old age pension and disability pension base is planned at EUR 136 (EUR 163 for person with disability since childhood).
Minimal old age pension will be set for every year of work experience using 1.1 coefficient. For every next year that exceeds old age pension the amount will be increased by 2% of minimal old age pension calculation base.
In the event of loss of bread-winner, children under the age of seven years will be provided state social security benefit and minimal pension of EUR 136 (EUR 163 for children seven years old).
It is also planned that in the event of loss of insured person or loss of unemployment recipient the funeral benefit will be paid in triple amount – EUR 327.
It is planned the minimal income threshold will be determined, applied and used by the State Social Insurance Agency and municipalities’ social services.
Amendments were proposed to establish a methodology-based and socially-economically fitting minimal income volume increase for persons with low and very low income.
The Saeima will decide on amendments in the second and final reading on November 23. Changes are expected to come into force January 1, 2021. (BNN/Business World Magazine)
