Ministry plans higher pensions and new affordable housing legislation

14-02-2019

The Ministry of Labour and Social Affairs is proposing an increase in old-age pensions next year. Minister Jana Maláčová also announced on Thursday that she was drafting legislation aimed at delivering affordable housing.

Photo: Miloslav Hamřík, Pixabay / CC0Photo: Miloslav Hamřík, Pixabay / CC0 Speaking at a news conference marking her 200th day in the post, the minister of labour and social affairs, Jana Maláčová of the Social Democrats, said pensions should increase by CZK 900 a month from next year.

Prime Minister Andrej Babiš of ANO put forward that exact figure recently and the Social Democrats have got behind the proposal.

Minister Maláčová told reporters that a bill being readied by her officials would increase the fixed part of the pension, reduce the merit factor and boost solidarity.

Ms. Maláčová said the merit and solidarity aspects of setting pension levels needed to be in harmony. Though the former was very important it was still necessary to help those on low pensions, she said.

The fixed part of the state pension, which this year stands at CZK 3,270, is the same for all recipients. Merit relates to level of income while working and number of years in employment.

Experts say that the pension system in the Czech Republic, which serves 2.41 million people, is already one of the most solidarity-based in Europe.

On Thursday the minister of labour and social affairs also announced that changes to the system of housing benefits should take effect in two years’ time.

Such benefits will only be available to people with no assets and come in two categories: one for those living in apartments and the other for those in hostels.

Jana Maláčová, photo: Czech TelevisionJana Maláčová, photo: Czech Television This state support should correspond to typical rents in a locality, Minister Maláčová said, adding that she would present the relevant draft legislation to the cabinet within the next few weeks.

At present the state provides two forms of benefits, contributions and supplementary payments. Contributions are open to those whose incomes do not reach 30 percent of the cost of adequate housing (in Prague the figure is 35 percent).

While the Ministry of Labour and Social Affairs plans to carry out asset evaluations, Ms. Maláčová said many exceptions will be made. The state will not force families to sell their cars or make old people offload their cottages, she said.

The long-term unemployed and those repeatedly caught committing misdemeanours will have to cooperate with social workers if they are to be eligible for benefits.

Ms. Maláčová said even middle class families were finding it difficult to find housing given the high cost of housing in the Czech Republic. The state must invest in construction and support co-operative housing, she said.

14-02-2019