Direct Request (CEACR) - adopted 2021, published 110th ILC session (2022)

Social Security (Minimum Standards) Convention, 1952 (No. 102) - Luxembourg (Ratification: 1964)

The Committee notes that the Government’s report has not been received. It hopes that the next report will contain full information on the matters raised in its previous comments.

Repetition

Part VII (Family Benefit). Article 44 of the Convention. Calculation of benefit. The report indicates that the Family Benefits Act of 23 July 2016 made changes in the family policy: the previous rule of the differentiation in the amount of the child benefit according to the number of children in a family was cancelled and replaced by a fixed amount of the family benefit of €265 per child. Consequently, the Committee requests the Government to recalculate the total value of the family benefit in accordance with Article 44 of the Convention.

Article 68. Suspension of benefit. According to the 49th annual report on the application of the European Code of Social Security, the family benefit could be ceased as a result of terminating study at school. The Committee requests the Government to explain how this rule is applied in practice, indicating in particular whether the fact of leaving the school before graduation automatically results in the stoppage of payment.

Part XI (Standards to be complied with by periodical payments). Applying the Convention on the basis of minimum benefits. The Committee recalls that Convention No. 102 can be applied on the force of social insurance schemes providing earnings-related benefits (Article 65) or flat-rate benefits (Article 66), or social assistance schemes providing means-tested benefits (Article 67). Another option consists in applying the Convention on the basis of basic income security guarantees where a social insurance scheme provides a minimum benefit, or a fixed basic amount as part of the earnings-related benefit, or where there is a guaranteed minimum income scheme or a universal social pension. The Committee systemically looks at this option every time when the regular benefit provided by the scheme in question does not attain the level prescribed by the Convention. It observes that the importance of the minimum benefits for the application of the Convention has been growing steadily inasmuch as in many countries the replacement level of regular benefits showed a marked downwards trend, falling below the percentage prescribed by the Convention and, for low-wage earners, even below the poverty line in absolute figures. For the ordinary labourers a guaranteed minimum pension often provides better protection in terms of the Convention, as they retain little chance of earning a higher pension after 30 years of insurance.

According to the Convention, the amount of a guaranteed minimum cash benefit, whichever form it takes, shall not be less than the corresponding benefit calculated in accordance with the requirements of Article 66. For the family of the standard beneficiary, this amount shall be such as to attain, in respect of the contingency in question, at least the percentage of the reference wage of the ordinary adult male labourer indicated in the Schedule to Part XI of the Convention. For other beneficiaries with different family responsibilities, the guaranteed minimum benefit shall bear a reasonable relation to the benefit of the standard beneficiary (Article 66(3)). In all cases, the resulting amount shall be sufficient to maintain the family of the beneficiary “in health and decency” (Article 67(c)) under the conditions of entitlement prescribed by the corresponding Part of the Convention with respect to the qualifying period, age and duration of payment. This adequacy criteria comes forward when the amount of the minimum benefit calculated as percentage of the reference wage of the ordinary labourer falls below the poverty threshold to a point incompatible with living in “health and decency”. With respect to maintaining the family of the beneficiary in conditions of health, the minimum benefit shall be sufficient to cover the required cost-sharing by the beneficiary in the medical care guaranteed to his family under Part II of the Convention in such a manner as to avoid hardship and not to prejudice the effectiveness of medical and social protection (Article 10(2)). Persons on minimum benefit in need of health care should not face an increased risk of poverty due to the financial consequences of accessing the types of health care specified in Article 10(1). With regard to maintaining the family of the beneficiary in conditions of decency, the minimum benefit, together with other statutory social protections, shall allow life in dignity and provide income above the national poverty line or similar income threshold, preventing vulnerability and social exclusion. The entitlement to the minimum benefit shall not be subjected to any additional conditions of a discriminatory nature applied to any member of the family of the beneficiary, and shall not deprive the beneficiary of the acquired social and insurance status, including the rights acquired or in the course of acquisition under the statutory social security schemes. When the legislation makes the provision of social security benefits conditional upon occupational activity, periods during which minimum benefits are paid should normally be taken into consideration for acquisition of the right to other social security benefits. The rate of social insurance contributions or taxation or both applied to minimum benefits shall be determined in a manner which avoids hardship to persons of small means with due regard to social justice and equity (Article 70(1)). The current rates of the minimum benefits in respect of the long-term contingencies shall be adjusted to the cost of living (Article 66(8)). In the light of these explanations, the Committee requests the Government to assess whether and to what extent the existing minimum social security guarantees in Luxembourg comply with the abovementioned requirements of the Convention as to their level and conditions of entitlement, and could be used to give effect to its provisions under each accepted Part of the Convention. For the relevant statistical indicators concerning income, poverty and wages the Government may wish to refer to the ILO technical note.