The Government has commissioned an investigation into a benefit cap to ensure that it is always more profitable to work than to live on benefits.
The investigator Maria Hemström Hemmingsson is now presenting two proposals, warning about one of the alternatives:
Theoretically, it is fully possible to design such a proposal, but the model has very large effects, primarily for families with children, and is not compatible with the Convention on the Rights of the Child in the long run.
Halved Benefits
The investigator points out that large families with children, who would receive halved benefits, will struggle to meet their children's basic needs for clothing, food, and housing. This also risks leading to increased segregation and crime.
The proposal applies regardless of household size and means that the sum of benefits, compensation, and maintenance support that a household can receive will never exceed 80 percent of what one would have received if one worked with a salary of 22,000 kronor.
This means that maintenance support will decrease with the excess level, and in practice, it means a ceiling for maintenance support, says Hemström Hemmingsson.
An Alternative
The investigator is also presenting an alternative proposal that involves a restriction rule that affects families with more than three children under 21 years of age living at home.
It's about essentially halving the private costs for children who are more than three in the household, says Hemström Hemmingsson.
This proposal is estimated to increase the incentives to work and is compatible with the Convention on the Rights of the Child. However, according to the investigator, it will have "very limited effects" on increased employment and reduced benefit receipt.
It won't be the case that it always pays to take a job, but the effects are tangible for larger families, and it's precisely there that we have challenges with it not paying to work, says the investigator.
Minister for the Elderly and Social Insurance Anna Tenje (M) says it's too early to choose one of the alternatives.
It's about weighing the pros and cons.
This is not a proposal that you move forward with alone, but it's part of the whole, says Tenje, referring to the benefit cap being combined with the investigation's several other proposals.
She also mentions other ongoing investigations into activity requirements in maintenance support and qualification for welfare.
