Welfare Reform

Basic Child Allowance: SPÖ Breaks Campaign Promise

The government aims to cut child poverty in half within three years.(Bild: Yulia Raneva - stock.adobe.com)

During the election campaign, the SPÖ promised a basic child allowance; the government’s program calls for halving child poverty by 2030. However, neither of these commitments is reflected in the “New Social Assistance” plan presented by SPÖ Social Affairs Minister Korinna Schumann, says Caritas Director Klaus Schwertner.

Schwertner is calling on the federal and state governments to declare war on child poverty: The planned reform would be a major opportunity in the fight against child poverty. 395,000 children and adolescents in Austria are at risk of poverty or social exclusion.

Schumann’s draft bill provides, among other things, for fixed rates for adults and a closer link to integration and labor market measures. For children, the minister intends to return to nationwide minimum rates based on existing regulations in the states.

Planned Division into Cash and In-Kind Benefits
The standard child benefit rate is to be split into two parts—a cash benefit and a benefit-in-kind, each with a minimum rate. The latter is to be administered via a benefit-in-kind card in the form of an app. It is to be part of social benefits and thus also available to children in families where the adults are unable to work or are exempt from employment. For families who earn little but are above the social assistance threshold, there will be a “participation card” in the future. 

Schwerter reminds the government of its own goals.(Bild: Johannes Hloch)

“If the law is enacted as planned, the goal will not be met.”
Children and adolescents make up the majority of people living in households receiving social assistance. Yet, in Schwertner’s view, the draft falls far short of expectations on this very issue: “The government set an important goal for itself in its governing program: it wants to halve child poverty in Austria by 2030. The social assistance reform is by far the greatest opportunity to achieve this goal. But if the law is passed as planned, the goal will not be met.”

“Not only will the announced nationwide standardization of social assistance not be achieved, but different benefit levels for children could still exist in the future, and there is no mention whatsoever of a basic child allowance in the draft. Furthermore, the risk of low child benefit rates has not yet been eliminated,” Schwertner criticizes.

Schwertner: Opportunity Bonus as a Supplement
Currently, the positions of the individual federal states are miles apart. Schwertner therefore appeals to the federal and state governments to seize this opportunity and at least settle the issue of the fight against child poverty. He proposes an “opportunity bonus” for children from low-income families as a supplement to family allowances. The Opportunity Bonus could consolidate various existing government benefits for children under one umbrella and regulate them uniformly nationwide. 

The Caritas director cites a specific case: The single mother of 12-year-old Leo is unable to work due to an illness; the family lives on welfare, child support, and child benefits. With the start of the school year, many expenses came due all at once: school supplies, parent fees, the Top-Jugendticket, athletic shoes, and a down payment for the project week. The annual fee for the soccer club will likely be unaffordable this year because operating costs have risen and the electricity bill needs to be paid. The mother is already very anxious about the annual gas bill.