Shake-up for child-based benefit system, cuts will save €800m

The government is to press ahead with the simplification of child-based benefits, bringing the number down from 11 to four and sharply reducing the payments for older children.

The changes, presented to parliament on Tuesday by social affairs minister Lodewijk Asscher, will save the government €800m.

They are likely to hit unemployed single parents hardest, who will lose around 4.5% of their income. Single working parents, on the other hand, with a minimum income will gain around 10%.

Gradual reduction

Starting in 2014, child benefit for older children will be reduced gradually to the amount paid for children between 0 and five years. By 2016, parents will receive the same amount in child benefit regardless of the age of the child or how much they earn.

Parents currently get €191.65 every three months for a child aged under five, compared with €273.78 for a teenager.

Asscher plans to keep just four of the current 11 child-based benefits, which he says will make the system fairer. The present system often means benefits bring in more money than a job paying the minimum wage, the minister said.

Asscher needs to reach agreement on the plans with the opposition, as the coalition government does not have enough seats to push the changes through parliament.

Green party GroenLinks has already said it is not happy with the changes, while the Christian party ChristenUnie says the government is letting families pay the price of the economic crisis.

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