Cuts to housing benefit come into force from today, bringing reductions in payments when recipients next face an assessment — but at the latest, by next March.
The basic deductible in housing benefit — the amount recipients must cover themselves out of other income — has increased for new applications. Those currently receiving the benefit will continue under the old arrangements until their next assessment.
The Social Insurance Institution Kela says that the impact of the cuts will be lighter on families with children, because allowances are made for children in the calculations.
In addition, the cuts will reduce general housing benefit for all those who currently receive it. That amounts to some 400,000 households, according to Kela.
In addition, housing benefit cannot in future be used to pay for expenses related to owner-occupied housing, such as maintenance fees.
That change takes effect immediately for new claimants, and from the end of the year for those already receiving housing benefit.
Pensioners' housing benefit is not affected by the changes.
Unemployment benefits are also due to change from Monday, with recipients no longer receiving higher payments if they have children.
In addition, the current rule allowing people to earn 300 euros through work each month without reducing the amount paid in unemployment benefit will be changed — in future every euro earned through work will reduce unemployment benefit payments by 50 cents.
Kela estimates that the changes affect around a million people, and the impacts will be felt most by young people living alone, and unemployed young people.
Kela says it has made preparations to handle an expected increase in applications for income support, the social benefit of last resort, which may replace some of the lost income for those affected.
In addition to the cuts, the government has also increased child benefit payments for children under three. Payments for families with multiple children increased from the start of the year.
EDIT: Headline updated 2.4 to add the missing word "cuts".
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