The list of expenses when assigning a subsistence benefit will include the payment of a housing loan

01.07.2022 | 14:19

Starting from July 1, 2022, people who have fallen into a difficult economic situation will be able to apply, along with an application for subsistence benefit, also for compensation of payments aimed at repaying a home loan. In this case, the same principle will apply as with compensation for rental housing costs.
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According to the Minister of Social Protection Signe Riisalo, this change should improve the living conditions of low-income families, if they risk losing their homes due to financial difficulties. “In the changed economic situation, we must help our people in every possible way and support the ability of people to cope with everyday difficulties.”

In 2021, local governments paid subsistence benefit to 9 806 households, 16 508 people received it, which is 1.2% of the Estonian population. According to the forecast, the number of recipients of the subsistence benefit will increase by about 900 households due to the above change. 

The Health and Welfare Information Systems Center (TEHIK) has developed a new Social Services and Benefits Data Registry (STAR) functionality that allows home loan costs to be taken into account when calculating subsistence allowance. The register is one of the main working tools of social workers of local governments.

which allows to make the necessary determinations of the subsistence benefit, the calculations taking into account the payment of the home loan,” said Project Manager of STAR Karin Rits, and added that TEHIK plans to develop the technical solution in the coming months. “We want this to be a convenient environment for both local governments and ordinary users in the future. We hope that a fully-featured solution will be ready by the beginning of the new year.”

The subsistence level is:

  • for a person living alone or for the first family member of the family 200 euros per month;
  • for each minor child (under 18 years of age) 240 euros per month;
  • per the second and each following family member 160 euros per month.

Home loan repayment is taken into account if:

  • the applicant lives in a dwelling acquired with a loan and this is reflected in the population register;
  • the applicant or a member of his/her family has taken out a home loan;
  • in the case of a home loan, the opportunity to receive a payment holiday has been used, or the applicant (or a family member) provides an explanation from the bank why it is not possible to use the payment holiday;
  • the applicant does not have loan insurance or this insurance does not fully cover the repayment of loan obligations.
  • loan repayments are taken into account for a period of up to six months during a calendar year.

Auris Aleksandrov