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Austria reprimanded by Brussels over controversial family allowances reform

Monday, 28 January, 2019 - 20:16

The European Commission has launched an infringement procedure against Austria over its controversial reform of family allowances, which reduces the amounts paid to foreign workers whose children live outside the country. 

“Our single market is based on fairness and equal treatment. There are no second-class workers in the EU.” EU Social Affairs Commissioner Marianne Thyssen said in a statement.

“When mobile workers contribute in the same way to a social security system as local workers, they should receive the same benefits, also when their children live abroad. There are no second-class children in the EU,” she added.

A law passed by the governing coalition of conservatives and the extreme right in Vienna, which came into force on 1 January, modulates the amount of family allowances paid to foreign workers according to the cost of living in the country where their children reside. 

For example, the reform can reduce the amount of monthly benefits paid by Austria for a three-year-old Romanian child from 172 to 85 euros, and to 97 euros for a Hungarian child.

The move has attracted sharp criticism from EU member states like Romania, which has more than 80,000 of its citizens living and working in Austria, writes Radio Free Europe.

The campaign promise, which would apply to nearly 150,000 children living outside Austria would save the Austrian executive more than 100 million euros a year. 

To justify the measure, the government explained that the current amount of family allowances (which can reach 223 euros a month per child), compared to the cost of living in neighboring countries, is “disproportionate”. 

“It is an unfairness built into the system that, for two children who do not even live in Austria but in Romania, roughly 300 euros a month are transferred to Romania and that is almost the average income there,” Austrian Chancellor Sebastian Kurz told reporters on January 3.

Austria now has two months to respond. If it does not amend its law, the Commission can refer the case to the EU Court of Justice.


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