The Union of Rights

Income in EU Member States

Basic income and gender gap: this is how the Union tries to fight inequality.

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The long road to a common identity

by Francesca Sironi

Those with no income in Austria receive €827.82 a month. If they are married or live in a marital status, the amount is increased to €1,241.74 a month

Welfare systems have always been important factors in building a national identity”, said Paolo Onofri, Vice President of Prometeia, considered one of the major welfare experts in Italy, commenting in an interview with L’Espresso the need to look at the welfare systems to understand how EU countries work, how their social cohesion systems work. The welfare aid, he explained, as the Union has long supported, should be more and more “universal,” even though on a basis of “selective universalism, which identifies economic contribution depending on income,” given that experiences such as the Finnish one – where the State is currently experimenting a €500-check per month for 2,000 citizens “are a luxury we cannot afford.” The social benefits to GDP ratio is higher in Italy than in Germany. €300bn of these social benefits are allocated to pensions and income support for disability, €100bn of the health system. There are approximately €50bn left for other provisions, but these are often fragmented in bonuses and contributions which are too often too short-lived to become a certainty capable to offer some forward-looking perspective to the population.

Alessandro Serranò - AGF

Alessandro Serranò - AGF

“The European welfare state is not dead. Neither it seems about to disappear. But it must be made more efficient in fighting poverty and in making taxpayers aware that it not a tax, but a social insurance,” explained the President of INPS (National Institute of Social Insurance), Tito Boeri, in its year-end report. The debate, in Italy and abroad, is increasingly focused on the topic of basic income, in its broadest form, or on more limited provisions for a guaranteed minimum income subject to active job search and assigned only to those who live below a certain threshold (in absolute or relative poverty). On this front, experiences in Europe vary significantly. From the German model, where seven million people every month receive income support from Berlin, to the Netherlands, where the check is individual. At the bottom of the charts, in addition to Italy – that, before the recent proposal made by the Government led by Mr Gentiloni, recently activated the SIA (Support for Active Inclusion) to be allocated to 200,000 poor families – there are only Croatia, Greece, Latvia, Estonia and Bulgaria. Still, the latter three States have laws governing the matter, but not the funds needed for their economic coverage. “A European unemployment allowance could contribute to the founding of a yet unrealized common identity,” Onofri suggested at the time. “Technicalities are complex. There are several political hurdles. But Finance Ministries of France and Italy have put forward a proposal to that effect.”

Minimum income

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Source: Pasquale Tridico, Reddito di cittadinanza e opportunità economica: un confronto tra italia, Astril, 2015 (Basic income and economic opportunity: a comparison between Italy and the rest of the Union)
In Germany and the U.K. women are paid about €4/hour less than men

The other indicator in this map clove concerns gender pay gaps. It is a matter that tells much on the road ahead to reach gender equality, as it shows the contradictions existing even in the most “advanced” countries, when viewed from the gender equality perspective at the workplace. Elements composing this index, developed by Eurostat, are numerous. The “gender pay gap”, i.e. the average wage difference between men and women, which is high, for example, in Germany and in the U.K., while Italy is very equal on the matter. But it is not such a positive sign, experts say: with the contraction of salaries, especially after the 2008 crisis, men earn less, then their salaries moved downwards towards women’s ones

In order to balance this effect, the Eurostat index takes into account two other elements: the number of hours paid per month, indicating whether there is a predominant use of part-time for women, and the employment rate. In this context, Italy loses its leadership: with female employment among the lowest in Europe, and a significant use of reduced hours for female workers, the real difference of conditions exceeds 43 percent. Positive examples in all three aspects (salary, hours paid, employment) are Slovenia (where the female employment rate exceeds 60 percent, and women represent 19 percent of members of the Boards and 16 percent of managers); Denmark (which also has average hourly wages among the highest in the EU) and Cyprus.

Slovenia is the most egalitarian Member State in terms of treating man and women at the workplace

Gender pay gap

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Source: Eurostat, 2014 (latest available data for comparison)