Publication details
ESPN Thematic Report on In-work poverty in Europe - Czech Republic (European Social Policy Network)
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| Year of publication | 2018 |
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| Description | While the average IWP rate for all EU countries increased by 0.7 percentage points between 2012 and 2017, the Czech Republic recorded a decline from 4.6% (2012) to the level of 3.6% (2017), one of the lowest levels in the EU. Men and women, as well as different age groups and people born outside the country are affected similarly by IWP. Those more affected are self-employed people and employees on part-time and temporary contracts. Big differences in IWP are seen in relation to the level of education (the IWP rate among low-skilled people increased from 9.5% in 2012 to 11.4% in 2017), work intensity and type of household (single parent families are at a high risk of 17.5%). One factor contributing to the low IWP is a relatively low (and decreasing) unemployment rate, which dropped from 7.0% to 2.9% between 2012 and 2017: this reduced the number of working households where a member is unemployed. Another factor is policies that influence IWP. Effective in this respect are tax reliefs for the tax payer, his or her spouse and children in the case of low earners. Second, social transfers seem to be quite effective in alleviating the risk of poverty: they reduce poverty headcount by 67.6% for the working poor (from 11.1% to 3.6%). To some extent also the minimum wage contributes to the low level of IWP. On the other hand, we have identified some policy deficits such as a limited scope and inadequate targeting of life-long learning and ALMPs at the low skilled and other vulnerable groups. Similarly, the measures that could improve access for the working poor to the good quality jobs are underdeveloped. The assessment of the measures that influence IWP indirectly is mixed. Health care is both affordable and accessible. Also childcare in public kindergartens is both affordable and accessible to children over 3 years. On the other hand, other forms of child care (child-minding groups and private facilities) are less affordable. There is a lack of places for children under 3 years of age. Long-term care is neither fully affordable nor well-accessible, especially for families on low incomes. Affordability of rental housing is a problem for low-income families, particularly considering the rising housing costs. The issue of in-work-poverty as such is identified neither as a challenge, nor as a subject of policy discourse or a publicly discussed problem. Rather, the related issues are addressed in policy debates concerning, for example, wage increases (to certain professions in the public sector) and minimum wage increases. In the Czech Republic, no comprehensive approach towards the issue of in-work poverty has been adopted. Implicitly, however, the policies are guided by the values and norms that respect social equality principles. SILC data provide sufficient information on the IWP issue for the Czech Republic. A shortcoming of the IWP indicators used is that they do not take into account the amount of mandatory household expenditure and focus solely on income. People in rental housing are often beneficiaries of housing allowance that helps them (often only partly) cover the high housing costs. At the same time, this benefit lifts the household income above the poverty line and so the household can no longer be considered poor although, paradoxically, the disposable income is below the poverty threshold. Similarly, indebtedness and repayment duty are not taken into consideration. Recommendations for the Czech Republic include: a guarantee of affordable access to childcare, papa months in the parental leave scheme, fostering professional and affordable long-term care, life-long learning and vocational training for the disadvantaged groups in labour market, legislation of a revaluation mechanism of the minimum wage, affordable rental housing and legislation and prompt implementation of mechanisms/legislation to prevent indebtedness and enforcement proceedings. |