Petteri Orpo (NCP), the Minister of Finance, is proposing that the government trial a universal credit scheme not dissimilar to that adopted in the United Kingdom in 2013.
The Organisation for Economic Co-operation and Development (OECD), he reminds, estimated in its latest country report that a universal credit scheme would be an effective means to reduce both poverty and income inequalities, and would serve as a great foundation for a social security reform in Finland.
Juho Saari, a professor of social and health policy at the University of Tampere, similarly proposed in a government-commissioned report last week that the current minimum-level benefits be merged into a basic security act in order to reduce inactivity traps and social marginalisation.
Orpo on Saturday echoed the assessments of several experts and policy makers by viewing that a social security reform will be the most important task of the next government.
“The reform is needed to eradicate inactivity traps and ensure people find their way to the working life. I’m confident that a universal credit trial would be beneficial for preparing for the overall social security reform,” he stated.
The United Kingdom merged several social security benefits into a needs-based universal credit that adjusts automatically to changes in the earnings of its recipients, not dissimilarly to the universal basic income trialled in Finland. What sets it apart from the basic income, however, is that it imposes activity requirements on the recipients, such as the requirement to actively look for employment.
“The most central objective of the reform is to remove obstacles to employment and [ensure] the social security system makes it possible to combine work and security in the future. That’s why also the self-employed must be taken into consideration in the assessments,” said Orpo.
Another key objective should be to guarantee both work incentives and a sufficient level of financial support, according to him.
“The non-gratuitous nature of social security offers an opportunity to maintain benefits at a Nordic level without reducing the incentives for work significantly,” he estimated.
Aleksi Teivainen – HT
Photo: Jussi Nukari – Lehtikuva
Source: Uusi Suomi