The Minister council, on the proposal of the Vice-Presidency for Social Rights and the 2030 Agenda and the Ministry of Inclusion, Social Security and Migration, has given the green light to the Royal Decree-Law by which a Minimum Life Income, a new Social Security benefit, which is accompanied by focused inclusion strategies.

The Minimum Vital Income, which will be permanent, has the main objectives of income redistribution, with the intention of eradicate extreme poverty, and the social inclusion and participation in the labor market of people in vulnerable situations.

The Minimum Life Income is the Government’s response to structural problem of poverty that it exists in Spain and that until now it has not been sufficiently tackled by existing policies, as the recommendations forwarded to Spain from different international organizations have shown on numerous occasions. Its implementation has been accelerated to help cover the vulnerability situations caused by COVID-19, which are added to those of families who were previously in difficulties.

According to estimates, the new benefit could reach 850,000 beneficiary households, in which more than 2.3 million people live, with special incidence in households with children. In fact, of the 2.3 million potential beneficiaries, 30% are minors. There will also be a higher incidence among single-parent households, which will account for 16% of the beneficiaries. Among them, almost 90% are headed by a woman.

The Minimum Life Income starts from 14 types of homes (depending on the number of members and whether they are single-parent) and establishes a different level of guaranteed income for each type of home.

The minimum level, which corresponds to one-person households, is 5,538 euros per year, the equivalent of a non-contributory pension. From this amount, an additional coefficient is established for each member of the household and a benefit for single-parent households, as indicated in the table below.

The Minimum Life Income is designed in such a way that it completes the pre-existing income (among others, salary), up to the guaranteed threshold for each type of home. If there is no income, the entire guaranteed threshold would be secured; but if they are available, the difference between the guaranteed threshold and the existing income would be covered. Thus, the average guaranteed income is 10,070 euros per year per household, while the amount of the benefit will be about 4,400 euros per year. The annual budget will amount to 3,000 million euros a year.

WHAT DOES IT CONSIST OF

The Minimum Vital Income is a benefit for households of any size, also one-person households. In each household there will be a holder who will request the benefit. If the household is made up of a single person, the owner will be between 23 and 65 years old and have been a household for at least three years. If the household has two or more members, in general the owner’s age will be between 23 and 65 years except in cases where there are dependent children. These households must have been established for at least one year.

For all types of households, at least one uninterrupted year of legal and effective residence in Spain will be required, except in situations of gender violence, trafficking and sexual exploitation.

For the benefit to be recognized, the household must have a total income below the guaranteed income for its type of living unit. In addition, to certify that the Minimum Vital Income reaches the most vulnerable households, an estate (discounting the habitual residence) less than 3 times the annual guaranteed income for a one-person household will be required, with a scale of increases by number of members in the home.

The benefit will be received monthly and will be charged in 12 payments. It can be requested from June 15, although, for applications submitted in the first three months, it will be granted retroactive to June 1. In addition, during the first month of validity of the benefit, it will act ex officio to pay about 100,000 households that meet the requirements, without it being necessary to request it.

The request will be multichannel. It can be submitted through the electronic headquarters of Social Security or by sending the documentation by ordinary mail. In addition, access will be allowed through the municipalities once the planned agreements are signed and at the Social Security Information and Care Centers when they return to the public. To provide information to potential beneficiaries, a 900 telephone and a simulator will be launched on the Social Security website, where questions can also be consulted through the virtual assistant.

MORE THAN A MONTHLY FEE

The Minimum Vital Income is a whole social policy that is linked around a benefit, so that, beyond the monetary aid, it includes inclusion strategies, in coordination with the autonomous communities and the municipalities, that allow people in vulnerability to transit to a better situation. The beneficiaries will have incentives to hire and a “Social Seal” will also be created for companies that offer them training and employment.

In addition, participation in the labor market will be encouraged with incentives. When the holder of the benefit does not have a job and finds it, part of his salary will be temporarily exempt in the calculation of the benefit. In the event that you are employed, when your salary increases, the amount of the benefit will be reduced by a lower amount. In the event that the holder is not employed, registration as a job seeker will be required for access to the benefit.

For the recognition of the benefit, the income of the immediately previous year will be taken into account, although to address the vulnerability situations generated by the COVID-19 pandemic, it may also be recognized for applications made during 2020 taking into account the income situation of this year.

The result of the Minimum Vital Income and the different inclusion strategies and policies will be evaluated annually by the Independent Authority for Fiscal Responsibility (AIReF), through the issuance of the corresponding opinion.

The Minimum Vital Income will reach 850,000 households that are among the poorest 17% of the population, with an average disposable income that does not reach 310 euros per month. Its purpose is to leave no one behind and it will practically eradicate extreme poverty in Spain. It aspires to the full participation of all citizens in social and economic life through an innovatively designed benefit, by implementing a focused, evaluable and coordinated social policy.

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