What is Subsistence Benefit?
Subsistence benefit is a financial state aid to an individual or household with lack of resources. Subsistence benefit is paid if all other measures to alleviate poverty and need have shown to be insufficient. Subsistence benefit is paid by local governments and is financed from the state budget.
The provisions for the application for calculation, granting and payment of subsistence benefit are laid down with the Social Welfare Act. The bases for the calculation of subsistence benefit is the last month’s net income of a person or family, fixed housing expenses due the current month and the established subsistence level.
The Parliament establishes the subsistence level for a person living alone or to the first family member (aka single level) annually. Subsistence level is established based on minimum expenses made on consumption of foodstuffs, clothing, footwear and other goods and services that satisfy the primary needs.
The subsistence level of each minor family member is 120% of the single level and 80% of the single level for each subsequent family member.
In 2019, the subsistence level for a person living alone or to the first family member is 150 euros per month. The subsistence level of each minor family member is 180 euros and for each subsequent adult family member, the level is 120 euros per month.
Beneficiaries of subsistence benefit with only minor family members are entitled, in addition to the subsistence benefit, to an additional social benefit of 15 euros.
Depending on the situation of a person or a family, local governments use different social services and other forms of social assistance to alleviate needs. In addition they may grant and pay additional social benefits from local government’s budget.
Who Are Entitled to Subsistence Benefit?
A person living alone or a family whose monthly net income, after the deduction of housing expenses, is below the subsistence level has the right to receive a subsistence benefit.
Upon granting the subsistence benefit, the following persons who live in the same dwelling and have a shared household are deemed to be family members:
- persons who are married or in a relationship similar to marriage;
- ascendants and descendants related in the first and second degree;
- other persons who have a shared household.
Students up to 24 years of age are deemed as family members, if the address details of their residence entered in the population register coincide with the address details of the residence of the family members.
All and any income of a person living alone or the net income of all family members during the preceding month, not specified as an exception by law, will be treated as income (for example: wages, family allowances, unemployment insurance benefit, unemployment benefit, received child support, maintenance allowance, pension, disabled person’s allowance, income tax return, any other form of income).
Upon calculating a subsistence benefit, the following shall not be included in the income of a person living alone or a family:
- single benefits paid out of the funds of the state budget or local authority budget;
- periodic benefits paid from local authority budget funds pursuant to the legislation of the local authority which are dependent on family income or granted to compensate for the cost of a specific service;
- benefits paid on the basis of the Social Benefits for Disabled Persons Act, except for the disabled parent's allowance;
- student loan granted with security guaranteed by the state;
- grants and transport and accommodation benefits paid on the basis of the Labour Market Services and Benefits Act or from the structural assistance funds;
- basic allowance, needs-based study allowance and needs-based special allowance paid on the basis of the Study Allowances and Study Loans Act and allowance paid from a special allowance fund established by an educational institution;
- earned income received by a child who is enrolled in a basic school, upper secondary school or formal vocational education until attaining 19 years of age or after attaining 19 years of age until the end of the current academic year or until the student is excluded from the list of the school.
Starting from 2018, in the event that a subsistence benefit applicant or a member of a family applying for the benefit starts receiving earned income and was granted subsistence benefit for at least two consequent preceding months and the calculation thereof did not take into account the earned income, the following shall not be included in the income of a person living alone or a family during the months immediately following the receipt of earned income upon calculating a subsistence benefit:
- 100 per cent of earned income on two months and
- subsequently 50 per cent of earned income.
It is possible to use the aforementioned exception once in 2 year’s time.
In addition, a local government may decide whether the following shall or shall not be included in the income of a person living alone or a family:
- grants and benefits supporting studying or working;
- benefits paid to cover specific expenses or loss;
- monetary benefits and gifts received from people close to a person or a family to improve the coping thereof to the extent of one-half the subsistence level per family in one month.
Taking into account the limits established and the socially justified standards for dwellings, the following fixed expenses connected with dwelling payable during the given month shall be taken into account upon calculation of a subsistence benefit:
- the administration costs of the apartment building, including costs related to repairs;
- repayment of loan taken for renovation of the apartment building;
- the cost of services of supplying water and leading off waste water;
- the cost of thermal energy or fuel consumed for supply of hot water;
- the cost of thermal energy or fuel consumed for heating;
- the costs related to consumption of electricity;
- the cost of household gas;
- the expenses made on land tax, which is calculated based on the size of land that equals three times the area under the dwelling;
- the expenses made on building insurance;
- the fee for the transport of municipal waste.
In addition to the aforementioned, upon calculating a subsistence benefit for a person living alone or a family who have been granted a subsistence benefit in the six months immediately preceding the calculation of a subsistence benefit, a local government may take into account other single housing expenses within a subsistence limit during one calendar year the incurring of which is unavoidable and the result of a piece of legislation or due to risk on the health or life of a person.
Socially justified standard for dwelling is 18 m2 per every family member plus 15 m2 per family. The limit for fixed expenses, connected with dwelling will be established by a rural municipality or city government to ensure subsistence, worthy of a human being. If students up to 24 years of age who deemed to be members of the family have additional expenses, connected with dwelling, 18 m2 per student will be added to the socially justified standard per family.
Who Should You Address?
Subsistence benefit is granted and paid by a local government.
In order to obtain a subsistence benefit for a given month, a subsistence benefit applicant shall submit an application to the local government in whose administrative territory the actual residence of the applicant is located not later than by the last working day of the given month. Within five working days after the submission of all documents, a subsistence benefit shall be granted. A local government shall pay the amount calculated as subsistence benefit, within three working days after the date on which the corresponding decision is made.
A local government has the right to refuse to grant a subsistence benefit or to reduce the sum of the granted subsistence benefit:
- if a benefit applicant or a member of a family applying for a benefit is a person of working age with ability to work who is not working or studying full time and not on academic leave;
- if a benefit applicant or a member of a family applying for a benefit is a person of working age with ability to work who is not working and is not registered as unemployed or job-seeker with the Estonian Unemployment Insurance Fund;
- if a benefit applicant or a member of a family applying for a benefit is a person of working age with ability to work who is not working and is registered with the Estonian Unemployment Insurance Fund, but has refused to comply with an individual action plan or turned down suitable employment without good reason;
- if a benefit applicant or a member of a family applying for a benefit is a person of working age with ability to work who is not working and has turned down suitable employment offered by the local authority without good reason;
- if a benefit applicant or a member of a family applying for a benefit is a person of working age with ability to work who is not working and has refused, without good reason, social services organized by the local authority to support the ability to cope independently;
- if the subsistence benefit applicant or a child entitled to receive maintenance who lives together with the applicant, or other descendant or ascendant who needs assistance and is unable to maintain himself or herself has the right to receive support but the applicant refuses to submit a document certifying the right to receive the support or refuses to claim the support;
- if the local authority finds that the property used or owned by the subsistence benefit applicant or his or her family or the lease, rental or sale thereof ensures sufficient funds for coping for the person or his or her family;
- if the local authority finds that a benefit applicant or a member of a family applying for a benefit has made no other effort to improve his or her own material situation or the material situation of his or her family.
The decision to refuse from granting the benefit will be announced to the person concerned in writing, within five working days after the date on which the corresponding decision is made.