The government announced plans yesterday to improve the situation of senior citizens and the disabled in Iceland, who have to survive off social benefits and pension funds. The first step of their plans will take effect in April and June next year.
As of April 1, 2008, individuals who receive limited social benefits, because their spouses’ monthly salary surpasses a certain limit, will receive the full amount, Fréttabladid reports.
As of July 1, 2008, the income threshold of senior citizens (how much they are permitted to earn without their pension funds being cut) will be increased from ISK 25,000 (USD 402, EUR 274) per month to ISK 100,000 (USD 1,608, EUR 1,095) per month.
It is a step towards changing the entire welfare benefit system. The first set of changes will cost the state about ISK 4.3 billion (USD 69 million, EUR 47 million) per year.
“I would like to emphasize that this is just one step, we won’t stop here,” Prime Minister Geir H. Haarde said during a press conference yesterday. “But it is all we can do at the moment.”
“It coincides with modern ideas that every individual should be financially independent,” Foreign Minister Ingibjörg Sólrún Gísladóttir added, referring to abolishing cuts to social benefits due to income of spouses, which she finds a great matter of justice.
Minister of Social Affairs Jóhanna Sigurdardóttir said “the big issue remains,” referring to a complete review of the welfare benefit system in Iceland.
A committee established by Sigurdardóttir, which worked on these changes alongside organized interest groups on the situation of pensioners and the disabled, will continue working on improving the entire welfare system.