SOCIAL IMPACT OF THE CRISIS

CC-29/09/09

SOCIAL IMPACT OF THE CRISIS

QUESTIONNAIRE SUMMER 09 – EAPN MEMBERS RESPONSES

1. What are the main characteristics of the Economic/Financial Crisis in your country? What are the main developments in 2009?

SPAIN

a) Intense contraction of GDP.

The Spanish economy is suffering a recession in terms of a 3% decrease of inter-annual GDP (May 2008-2009).

b) Drop of industrial production, consumption and exports.

· A year ago the Spanish industrial production grew ahead of four countries in the EU-16. One year after Spain is the country where industrial activity has dropped the most, by 24.7%.

· A steep drop in consumption of related manufactured products can be seen in the figures of new cars’ purchases: in 2009 Spain has fallen from the first place, to the last row of the European car market ranking.

· Another indicator is the volume of exports. In 2007, exports grew at the European Union’s rates, enduring the wrath of the emerging countries and outperformed five countries in the ranking. One year after exports fell far from the average, currently under critical levels.

c) Increase in the State deficit.

Between 1996 and 2004, public deficit was eliminated. From a negative budget balance of 6.6% of GDP, budget balance was achieved, public spending was reduced from 43.2% of GDP to 38.9%, thus increasing the sphere for private initiative to create employment. Austerity, spending control and a legal frame for budget stability and for tax and structural reforms enabled the accession to the Euro-zone. But the regulations of the Budgetary Stability Act have been relaxed. In 2006, Spain had a surplus of 2%, which made the sixth place in the EU-16. In contrast, in 2008 the deficit was about 3.8%, leading to the final quarter of the ranking. This worrying situation, with a forecast of 5-6% by the end of 2009, has forced to cut public spending and budgets during the first months of this year.

European Commission - Economic Forecast spring 2009

Forecasts for Spain

2007

2008

2009

2010

GDP growth (%, yoy)

3.7

1.2

-3.2

-1.0

Inflation (%, yoy)

2.8

4.1

-0.1

1.4

Unemployment (%)

8.3

11.3

17.3

20.5

Public budget balance (% of GDP)

2.2

-3.8

-8.6

-9.8

Current account balance (% of GDP)

-10.1

-9.5

-6.9

-6.3

4 May 2009, European Commission, European Economy n° 3|2009

http://ec.europa.eu/economy_finance/pdf/2009/springforecasts/es.html

d) A fast and intense negative impact on the labour market.

Eurostat has determined that the pace of job destruction has increased to 1.3% between January and March, over the same period of 2008. Spain brought 802,800 out of the 1,220,000 people who stopped working during this period in Europe.

From the first quarter of 2007 to the first quarter of 2009 that percentage of unemployed households (all working-age adults unemployed) rose from approximately 2.5% of total households, to 6.3%, reaching the figure of more than one million households. Unemployed households have by far the lowest level of disposable income per adult. During the same period, the percentage of no-income households rose from 1.8 to 2.8%, meaning 470,000 households (about one million individuals). This represents an increase of over one hundred thousand homes in two years.

Today’s results of the Labour Force Survey, EPA, states that there are 4,135,000 unemployed persons, almost 19% of the Economically Active Population.

Main results - Labour Force Survey, 2nd trimester 2009

· The number of employed people dropped by 145,800 in the second trimester of 2009, regarding the previous trimester, and stood at 18,945,000. In the last years the occupation has fallen in 1,480,200 people. The inter-annual rate of occupational change is -7.25%.

· The activity rate stood at 60.06%, nine hundredths less than in the first trimester. Males’ rate is 68.89% (22 hundredths lower than the previous quarter) and females’ rate is 51.55% (five hundredths higher).

· The number of unemployed persons increased by 126,700 in the previous trimester and stood at 4,137,500. Unemployment rises 56 hundredths, to 17.92%. The number of unemployed has increased by 1,755,900 people in the last 12 months.

· The total number of salaried people descended in 106,200 people on the previous trimester, and is estimated at 15,736,800. In the last year, the number of employees fell by 1,116,200. Employees with permanent contracts go down at 52,000, and the temporary employees to 54,200, in this trimester. The rate of temporary occupation stands at 25.24%, with a decline of 17 hundredths regarding the trimester before.

· In the second trimester of 2009, the number of employed persons increased in the Illes Balears (36,400 more) and, to a lesser amount, in Extremadura (7400) and Castilla y Leon (4100). The largest decreases in the number of employed persons in this trimester are found in Andalusia (52,200 less occupied), Catalonia (40,600), Valencia (30,200) and Galicia (21,100).

· The largest declines in unemployment in this quarter occurred in Catalonia (20,800 less unemployed), Extremadura (8300) and Canary Islands (7500). The largest increases in unemployment were observed in Valencia (57,500 more unemployed, than in the previous quarter), Andalusia (54,600), Castilla-La Mancha (14,600) and Asturias (9900).

Source: Instituto Nacional de Estadística, Encuesta de Población Activa (EPA), Segundo trimestre de 2009. 24 de julio de 2009 http://www.ine.es/daco/daco42/daco4211/epa0209.pdf

e) The fall in employment levels implies, inevitably, an increase of social needs. Even with delays, there is evidence that persistence over time of high unemployment rates increases inequality and poverty levels.

In the context of the crisis, the weaknesses of the scarcely distributive model of growth that reigned during the last 15 years became more visible. Those who already face poverty (or live on the edge of it) are hit extraordinarily hard in these days and will be in the year ahead. A stiff competition between those persons, and the newly impoverished people, is expected to increase. Important budget cuts in social spending are fuelling this process.

GERMANY

Due to its role as a great export nation, Germany notably suffers from drops in orders, cutback of production, insolvencies of companies and thus, a decline in employment. Caused by enormous decline in production the GDP decreased by 3.8 per cent in the first quarter of 2009 (after –2.2 per cent in the last quarter of 2008). As average for 2009 a loss of 6 per cent is expexted.

Nonetheless the German labour market is not yet hit by the crisis due to generous short-time working allowance policies: unemployment is only slightly higher than last year (3.4 million unemployed persons plus 1.4 million short time workers in August 2009). Latest economic projections do not predict extensive dismissals for this year but an increasing number of job losses is expected for 2010 (which are supposed to bring about up to 4 million jobless persons).

IRELAND

· Bursting of domestic led property bubble at the same time as global credit crunch has led to worse decline than other EU countries and reduced policy options.

· Standardized Unemployment rate up from 4.8% in Jan 2008 to 12.2% (July 2009). At the end of July 2009 there were 423,400 people on the Seasonally Adjusted Register.

· As of July 2009 there has been a 142% increase in redundancies. Three sectors continue to dominate these statistics and they are: other services; building and civil engineering; and other manufacturing. Higher rate of increase in unemployment among non-Irish nationals and younger and older people that in the workforce generally.

· Job losses started in construction but now affecting almost all sectors.

· Low level of credit available due to high and in many cases uncollectible property related debt – leading to business and job stagnation.

· Dramatic increase in exchequer deficit due to reduced tax returns ( expected to be at least 33% in 2009)

· Government borrowing has risen rapidly and not sustainable. IRELAND’s credit rating has been downgraded by all international rating agencies so the rates for interest repayments have increased. However this has shown signs of improvements recently.

· Evidence of highly unethical practice in banking sectors.

· Private sector pensions badly affected. Many companies pension funds are empty

· Growing retrenchment and weak spending with no definite plan for recovery apparent.

· Publication of the McCarthy report on making savings in public expenditure, proposals include dramatic cuts in social welfare, education and health, as well as changes to the universal child benefit payment.

· Commission on Taxation due to report soon and seen as likely to recommend a widening of the tax base to include property taxes

·

CR

Collective redundancies in manufacturing corporations, increasing unemployment (3 % more than 2008), increasing number of people in heavy indebtedness, increasing childrens poverty.

According to representative Factum Invenio research among general public 03/2009 (app. 1000 citizens over 15) –

The current economic crisis has already affected a fifth of czechs and more than half them expects impact of the crisis still.

Six out of ten have experienced or expected, in the context of crisis, decline in living standards. Two-fifths of the population fear the inability to save as before and the same percentage of the population is concerned about the loss of savings. More women (56%) than men (48%) fear the impact of crisis.

effects of the crisis has often felt by lower-income households. for households with gross monthly income to 15 thousand crowns mentioned crisis hitting almost 30% of their income and category 15 až 25 thousand crowns said the crisis hit more than a quarter (27%).

Effects of the crisis is more felt by lower-income households. Households with gross monthly income to 15 thousand crowns mentioned that the crise effects negatively up to 30% of their income.

Two-fifths of households fear that they will be unable to save and invest as much as they used to. Identical percentage of people is afraid of losing current savings. About a third of households is concerned about reduction in wages, unemployment, inability to pay regular bills and the cost of medicines and health care.

Three-fifths of households have reduced (31%) or plan to limit (29%), their spending. Expenditure cuts have already households with limited income to 25 thousand crowns, and people older than 60 years. Most often people reduced spending for clothing, footwear, of visiting restaurants, cafes and clubs, as well as expenses for food. In the case of deterioration of the financial situation of households they plan to save on telecommunications services and internet.

Car industry: In connection with the impact of world depression on the Czech economy, the car industry, which belongs to the crucial Czech industry, is said to be the most affected sphere with regard to the losses. The most motor car companies (e.g. Skoda, Hyundai, Tatra) had to discharge their staff from employment and restrict the production which had another impact on their suppliers and their employment, production restriction or they simply had to shut down.

Bank sector: Banks are supposed to slow down the progress of all sectors. For example, the mortgage volume sold to citizens on January among-yearly dropped to about 44 per cent.

Currency: Czech crown has been significantly weakened during the crisis.

Glassmaking: This traditional Czech industry has been struggling with contract declines for some years already. Many firms finished in bankrupt, several thousands of people have no work. According to the experts, the present depression has just advanced the fall of glassmaking.

Building industries: New work contracts dropped by approximately ten per cent. Orders from private sector to the building companies went down, particularly regarding new apartments but also commercial buildings. Building companies continue their work primarily thanks to the public sector’s demand.

Textile industry: This part of Czech economy used to be a very strong one. However, it has been struggling due to the crisis and suppressing for some years. The occuring crisis has strengthened the impact on some companies. A lot of firms are forced to shut down and discharge their staff.

Others: The crisis has affected the most economy sectors in some way. For instance a recent survey carried by the Economic Chamber has revealed that every second small or middle-size firm in the Czech Republic has already had to discharge its staff from employment or is going to do in a short time. More than one third of companies restricted the production or is planning to do so due to the drop of contracts.

SWEDEN

Rapidly increasing unemployment and it has spread from manufacturing industry to white collar sector and public sector. The Swedish GDP is estimated to decrease with 5,4 % in 2009 which is the largest decrease since the 2 world war.

A slight improvement of the financial situation has taken place during the last weeks, but that will not affect the unemployed.

FINLAND

As regards poverty, FINLAND is yet to recover from the previous depression it went through in the 1990’s. The subsequent economic growth, although remarkable, passed the poor, as the resulting wealth was distributed unequally. The income gap has been widening and relative poverty growing ever since. Much hope was being put in a Committee (SATA-komitea), which was assigned in 2007 to review the whole social system with a view to its complete overhaul and which has just delivered its intermediary report. Unfortunately, the economic realities seem to hit hard the Committee’s recommendations, on which it had great difficulties to find any concensus in the first place.

The most visible impact of the crisis so far is practically daily news on companies putting their employees on forced leave without pay (Finnish legislation allows employers to that, instead of giving them notice for good; it’s a sort of Finnish version of flexicurity, developed much before the term was invented). A number of labour force is also being dismissed right away, leading to growing unemployment.

THE NETHERLANDS

Financial crisis banks and other financial companies

Economic: more difficulties (less orders) for companies, more unemployment

BELGIUM

in Flanders: (DM 010909)

-100 new unemployed each day

-40.000 or 21,3 % more unemployed then this time in 2008

-youth unemployment 25 % higher then last year

-short and middle term unemployment has raised

-both low and highly educated people

Prognoses unemployment in BELGIUM: 70.000 extra unemployed in 2009, 110.000 extra unemployed in 2010

Problems with the general budget:

-expected deficit of 25 billion ! (6 to 7 % of gdp)

-18% less fiscal income than last yea

-government is building debts

-Belgian economy shrinks with 5to 6 %, now negative growth of 3,5 %

LITHUANIA

Growing unemployment, non-performing loans, and social security crisis

There is no enlargement in LITHUANIA this year

DENMARK

The first sign was in the financial institutions, where some few banks went bankrupt and all others slowed downed their activities. It is still in 2009 rather difficult to obtain loans for smaller enterprises and private persons.

The next sign was a nearly total stop for sale of real estates and decreasing in prizes up to 1/3, compared to the highest level in 2007. Buying of goods and services also decreased drastically. Many smaller shops were forced to sell out or even close. In 2009 both phenomena’s are still experienced. There are smaller signs of stabilization and even maybe an increase in sale of real estates, goods and services, but the situation is still considered as unstable.

The third sign was the hastily growing unemployment rate, now more than doubled, especially among unskilled workers, working in construction, production and service industries. Yet, the general unemployment rate is still below the rate in year 2000.

FRANCE

Réduction du PNB

Augmentation du chômage et plus grande difficulté d’accès des primo-demandeurs d’emploi au marché de l’emploi

Augmentation des déficits publics

Difficultés des entreprises

Eurodiaconia

As a European network we are more focused on the impact on our members as service deliverers and advocates for those in need. The major developments we are seeing through our members are:

· Decreasing funding for services either by reduced budgets or zero growth budgets

· Increased request for services as more people face economic and social challenges

· Need to develop new services e.g. food banks, debt counselling

UK

For data on the scale of the financial recovery package, see Appendix 1

2009

· The rate of decline of output has reduced. UK is likely to be out of recession in third quarter 2009

· The rate of decline in house prices has reduced relative to earlier quarters

Key question is whether this is due only to combination of the bank support and destocking completion by companies, rather than any rise in domestic or export demand – although the weak pound should help exports. If there is no real increase in demand, or further falls (see below) we may have a “double dip” recession.

Current Labour government is thinking of ending the financial stimulus (“quantitative easing”) being pumped into the economy, later in 2010. If there is a Conservative government following the election in 2010 (May is latest date), then they will reduce the financial support earlier and faster.

Unemployment is continuing to rise and is now greater than 2.5 million. Unemployment is predicted to continue to rise till 2011 or 20102 because it is a lagging indicator and also because some employers are taking advantage of the crisis to reduce employment and conditions.

Money wages are stagnant or increasing very slowly for most blue and white collar workers; some private sector employees have seen money wage cuts and some public sector workers are being offered zero or 0.5% wage rises and unraveling of three year pay deals already agreed.

Benefit money incomes are nearly stagnant. Most benefit incomes are uprated by price inflation – which is low.

Real incomes depend on whether you are on a central bank rate tracker mortgage (spending power is up). Those on fixed or standard rate mortgages and rent payers have lower purchasing power because their major housing outgoings have not reduced.

Utility bills continue high - they went up when fuel prices went up, but did not come down when oil price fell. They are predicted to continue to rise, as are water and public transport, especially rail fares. All these have risen faster than the rate of inflation – partly because of government requirements to invest in renewal of infrastructure - and will continue to do so, but also because many aspects of them are not regulated, they are privatised and many are foreign owned.

Low wage earners and benefit recipients in rented accommodation who spend a high proportion of their incomes on utilities, transport and food have seen their real incomes most reduced.

The main change in the debate in early 2009 was the shift away from bankers and their degree of responsibility for the financial crisis, to MPs’ expenses – these were apparently leaked by soldiers working temporarily in the Expenses offices between assignments in Afghanistan. They were leaked to a Conservative supporting daily newspaper who made them front page news over a period of weeks. This dominated the media debate and the responsibilities of bankers and hedge funds were sidelined, though there is still some outrage at their salaries and bonuses and that these have continued to be paid at the old levels even in banks financially floated by the taxpayer.

But the major current debate is about paying down the public debt by cutting public services. Essentially, this is the debate about who will ultimately pay for the crisis.

The public debt is manageable and lower than some other western states – and it will reduce automatically when tax receipts rise after the recession. Despite this and the risk of double dip recession there is more concern about how ratings agencies will rate our debt and the public debt debate has been captured by the same Conservative argument as in the Thatcher period (which resulted in a deep recession and 3 million unemployed) – that just like households, governments have to balance their books. All main parties have agreed there will be cuts – the Liberal leader at their party conference referred to a need for “savage” cuts and the Labour PM has admitted there will be cuts, having tried to avoid saying this publicly. It is likely there will be salary freezes or cuts, pension changes and cuts in employment for public sector workers; despite this there will be service cuts. There have already been proposals to cut some services and income supports to children and families and expectant mothers.

There is a significant debate about cutting the social benefits bill, with strongest support for cutting benefits to the unemployed - who already receive only 10% of average wages, plus housing support to their landlord.

The public seems largely unaware that the welfare bill for the unemployed of working age is a small fraction of the state pensions’ bill for the retired (£2.88 billion in direct payments- Job Seekers’ Allowance compared to £62.68 billion for pensions – the Guardian, 16 September:p21 ). However the public were already largely convinced that people would have to work longer because pensions would be too low. The state pension, like most other benefits, is uprated only in line with prices and over the years has drifted away from wages, one reason alongside our higher birth rate than some continental countries, why the demographic impact of ageing on public finances is not so great in the UK. Occupational pensions have been badly hit by the closure of final salary schemes – closures accelerated since the financial crisis – and their replacement by money purchase schemes (defined contribution rather than defined benefit). Most employers are putting in a much smaller percentage than they did under the old final salary schemes. These money purchase schemes have been badly hit also by falling stock markets. In their 2008 report, the UK NAP experts (Bennett and Bradshaw) said that the government’s strategy of shifting to private pension provision was “in tatters”.

Some Background Data from Seager, A in The Guardian, 28 September:p30

Overall our stimulus package was one of the smallest in the major economies, at 2% of GDP

State employs 6 million – 20% of working population, fewer than people think, but public spending cuts will show up in serious unemployment

Public spending is 42% GDP – in line with average since 1970 – it’s just that Labour got it down to 36% by 2000 as Tories and Labour cut after the last deficit of the 1990s recession

Taxes in UK are about average for OECD at 35% of GDP

There is no evidence of a link between tax take and economic performance (Dolphi IPPR)

We did have a structural public debt deficit before the crisis due to rebuilding public infrastructure after years of investment starvation

Deficit this year will be £200b 13% of GDP and in the next few years national debt may go up to 80% GDP - double the government’s 40% “prudent” level, So it would be possible to raise taxes rather than focus only on spending cuts – but no party is advocating it

Impact of ageing will mean even larger cuts if no tax rises

2. What are the key elements of your country’s recovery packages? How effective are they?

SPAIN

What are the key elements of your country’s recovery packages? How effective are they?

The government has embarked in a flurry of policy initiatives to protect or promote banking, automotive industry and other. “Social” packages have been promised – but, until now, there are more words than facts.

a) Launched and already implemented:

· Measures aimed at easing the economic impact of the plunging housing market and rising unemployment: a two-year moratorium on 50% of mortgage payments for those made unemployed and an extended tax exemption period for reinvested capital gains on house sales.

· The “Eplan 2008-2009” failed to activate the local labour markets, as it worked in the very short-run, due to low productivity ventures, with scarcely multiplying effects.

· National Social Housing and Revamp Plan, launched on July 22nd, with a budget of 10,000 MEURO for 2009-2012.

· Social Dialogue Initiative Table, composed by trade unions (UGT, CCOO), companies’ representatives (CEOE, CEPYME) and the government (Ministry of Labor and Immigration) is active, but with moments of uncertainty and blockage (July 23rd-24th).

However, in 2009 the government reduced more than 33.8 million new investment in public safety, 40 million program to the second cycle of infant education, and almost 15 million of loans and scholarships for secondary education. Also, the following cuts have been implemented:

· 59 million less for the fund to support the reception and integration of immigrants

· more than 12 million less to the IMSERSO (aged persons)

· 2.4 million less for the Plan of Action for Persons with Disabilities

· 3.01 million less in support measures for the 'positive parenting', among others.

· In total, the Government acknowledges having cut spending on 1,500 million; the ministries of Education and Social Policy (105) and Housing (105) are two of the four most affected.

b) Measures announced, but still not implemented:

· Extension of the unemployment insurance to those who are no longer covered. 29 out of 100 unemployed do not have income at all. In July, the Government is proposing a 12-month measure which consists of the extension of a monthly pay of 420 Euro for those resourceless unemployed. This proposal goes along with the possibility that companies could deduct two points of their Social Security contributions. Implied budget costs for both measures: 8,106 MEURO.

· Extension of the Guaranteed Minimum Income to more needy beneficiaries.

· Increase of 8% of minimum pensions, which are below Euro 500.

GERMANY

The German government has taken various measures in order to soften the repercussions of the crisis on the German economic and labour market. In November 2008 and January 2009, it adopted two economic stimulus packages (“Safeguarding employment by consolidating growth” and “Pact for stability and growth in Germany”) and provided approximately 100 billion euros for their implementation. The economic stimulus packages are designed to balance the export collapse by enforcing domestic demand, and to enable companies to keep their employees as long as possible.

In detail, the government has adopted several taxes and duty relieves. Among them, the green car incentives considerably stimulated the domestic demand for automobiles. Besides, the government encouraged public capital investments, especially in the local infrastructure (investments in educational institutions (6.5 billion Euro), local infastructure (3.5 billion Euro), transport routes, building refurbishment (4 billion Euro, car industry is supported by subsidizing buyers who choose a new car with an “environmental bonus” (5 billion Euro)).

It further enhanced and improved the arrangements for short-time working. This concept, being very well received outside of Germany as an effective action to hinder an increase of unemployment, in fact contributed to a great extent to avoiding suspensions of companies’ employees for the awaited upcoming economic revival. It has already existed before the crisis, but recovered its proper designation in these days. The number of employees working short-time has risen up from 100,000 to 1.4 million within one year.

Due to these measures, especially the short-time working measures, a dramatic increase in the number of unemployed could be avoided so far. However, relatively stable prices as well as the scheduled pension increase in July 2009 or the redemption of the commuter tax allowance also positively affect the present situation on the consumption and the labour market. Moreover, the labour market benefits from a decrease of manpower as a result of the demographic change in Germany.

IRELAND

· In January 2009 a Framework for a Pact for Stabilisation, Social Solidarity and Economic Renewal was produced through social partnership. There was an agreement in this Pact to ‘protect the most vulnerable’. While this sentiment has been repeated it has not been carried through on by Government. The social partnership talks collapsed in trying to agree certain elements of implementation and have not been fully reactivated following this.

· Government has commissioned two reports, one the McCarthy report on public expenditure has reported making dramatic recommendations for expenditure cuts, the other the Commission on Taxation likely to be published in September, though suggestions is will include proposals for property and carbon tax.

Banks

· Bank Guarantees provided for all bad loans, one bank is nationalized and major funds injected by the government into 2 others.

· Government has published legislation to establish a National Assets Management Agency (NAMA). NAMA will take the bad loans off the banks books, paying a price which will not reflect current market values, but rather longer term market outlooks. There is much debate about what value should be placed on these bad loans and on the impact of the final payment rate on the ability of the banks to lend again and on the risk the taxpayer will be exposed to fro many years to come. The opposition parties and the minor party in government have all expressed concern about the NAMA proposals and these will be debated in September. A number of commentators think that further bank nationalisation is preferable or inevitable in the future. .

Jobs

· Some new measures are being introduced to use Government supports to help companies to retain jobs at risk as a result of the crisis. For example in the beginning of August

· The Minister for Enterprise, Trade and Employment announced a €250 million scheme to protect up to 27,400 vulnerable jobs in the productive sector of the economy. The Employment Subsidy Scheme (Temporary) will provide a subsidy of €9,100 per employee over fifteen months to qualifying exporting enterprises in the manufacturing and/or internationally traded services sectors.

Exchequer Deficit:

· In July a Committee set up to look at where the Government could cut public spending reported, (McCarthy Report) suggesting major cuts and amalgamation of Government agencies and bodies as well as in supports to NGOs, and cuts to essential services and social protection levels. If implemented these will result in over 4 billion euro in cuts in public expenditure. Already major cuts to services have taken place.

· A Commission on Taxation has reported to the minister, the report is likely to be made public in September - proposing changes and areas where taxes can be increased - Some changes have already been put in place to increase revenue from a low tax base. These have included an income levy which on all income above the minimum wage on a progressive scale and a levy put on public sector pensions.

· The Minister for Finance has stated publically that he sees no scope for increasing further the income tax burden at this time (August 2009)

Effectiveness

· Jobs: Banks are still not lending to businesses or individuals. No sign yet of the effectiveness of direct funding from Government to address job retention or creation.

· Exchequer Deficit: Signs of Government at least understanding the extent of it and beginning to address it but the implications will have a lasting negative effect and there is considerable concern that the most vulnerable will pay a major price in cutting the deficit through reductions in social welfare rates and supports for children as well as in services essential to the most vulnerable eg cuts in education and heath budgets. Reductions in prices, although not across the board are being put forward as a justification for welfare rate reductions

· As an open island economy economists predict that IRELAND can only recover after there have been an international recovery from which we can benefit. Such a recovery may lead to a major increase in emigration among those seeking employment with initial positive impacts on unemployment rates but long term negative effects on future growth and on a pick up in consumer expenditure.

CR

· money or old cars to people (grit, scarp money) – to motivate to buy new cars – support for car industry

· accelerated depreciation of property companies (cars from 5 to 2 years)

· reduction of vat rate - companies can buy cars with vat deduction

= incerased sales of cars in the Czech republic

· reduction of contributions to social insurance for employers - estimated this law could help save 50 000 to 70 000 jobs

· amendments to the insolvency act

· slight increase of all child benefits (50 CZK monthly) for all ages, increases the child tax rebate

· temporary increase and extension of unemployment benefits (1 month)

Education and retraining is offered to unemployed people – visibly increased due to ESF support. Nevertheless, this approach is not very successful. Those people are looking for jobs (fast income) not for schools. Now, the Budget Committee of the Czech Parliament added 1,5 milliards CZK to enhance unemployment compensation. The summary of unemployment relief this year will be 15 milliards CZK, which is 4 milliards over the planned budget.

The recovery packages concern:

· temporary social bonification for employers (till the end of 2010)

· revised law on insolvency – protection of working places for companies in need; i.e. better protection of employees against insolvency of employers

· introduction of “scrap bonus” to support the purchase of new cars

· acceleration re-deductions of company possessions

· extending the time of relief in unemployment and improving the allowances

· support of retraining schemes

SWEDEN

Initially the focus was on the financial sector financial. During 2009 the focus has been on provide more jobs but the focus have shifted to measures regarding, education, vocational training courses, temporary employment with economic support from the government.

An important measure at the present is financial support to the public sector on local and regional level in order to prevent reduction amongst the employed and in order to safeguard the quality within the social- and health sector.

The change in focus to more educational and job creating measures is partly the result of criticism from the political opposition and the public and the fact that we have a political election coming up next year.

FINLAND

The Finnish Government has agreed on a stimulus package which, according to news reports, OECD’s experts recently called good but too small.

The following sections are excerpted from Press release 31/2009, Government Communications Unit, 3.2.2009 16.10.

“The Government has today, 30 January 2009, agreed on a stimulus package having an overall impact of EUR 2 billion. The package will generate at least 25,000 man-years in employment. As a result of the stimulus decisions made by the Government, overall GDP this year and next year combined will grow by approximately one per cent. The fiscal stimulus impact, 1.70 per cent of GDP, or EUR 3 billion, brought about by the decisions concerning the budget and supplementary budget of 2009, will also rank the third largest in the Commission’s comparison among the 27 Member States.

The objective of the supplementary budget is to minimise the number of people who, as a result of the international economic downturn, have become affected by cyclical unemployment, and to carry them over the hard times. The main emphasis is therefore placed on measures that directly promote employment, such as making investments in transport infrastructure, supporting construction and lifting the social insurance contribution. Additional priorities include education and research. The number of study places in vocational training will be increased, and appropriations allocated to research and development will be raised.

Employment: Construction, transport infrastructure and lifting the social insurance contribution

To soften the effects of the quickly deteriorating economic situation, measures will be taken to stimulate construction and renovation activities, to bring forward and increase the number of investments in transport infrastructure, and to lower labour costs by decreasing the social insurance contribution on employers. The impacts of the stimulus measures will altogether generate at least 25,000 man-years in employment. In addition, the decision to bring forward investments in transport infrastructure will generate 4,300 man-years in employment.

Impacts of the supplementary budget on public finances

In accordance with the decisions made in conjunction with the supplementary budget, a total of EUR 1.2 billion will be used to increase government expenditure and launch new projects. Lifting the social insurance contribution will produce an annual income reduction of EUR 833 million in the future. [italics added] The stimulus measures of the supplementary budget will weaken the balance in public finances by EUR 912 million in 2009. The stimulus decisions made will raise the spending limits for 2009 by EUR 216 million.”Not part of the stimulus package, but linked to the topic, is the following Press release 32/2009, Government Communications Unit, 30.1.2009 16.13:

“Guaranteed pension to be introduced in 2011

To secure a reasonable level for the smallest pensions, the Government commits itself to introducing the so-called guarantee pension at the beginning of March 2011. An amount of EUR 111 million will be used annually to finance guaranteed pensions. The level of guaranteed pensions would stand at EUR 685 per month in current money.

Guaranteed pensions will ensure that the smallest pensions are at a reasonable level. Approximately 123,000 pensioners would be covered by the guaranteed pension. The guaranteed pension supplement will be paid to persons whose overall pension (earnings-based pension and national pension) remains below the guaranteed pension level.

Indexation of basic security benefits to extend

Basic security benefits not covered by indexation (minimum allowance, child benefit, home care subsidy, private day care subsidy) will be linked to the consumer price index. The first index increase will be effective on 1 March 2011.

The annual index increase will alleviate the impacts of inflation and ensure the purchasing power of basic security benefits. Most benefits regarded as basic security are already covered by indexation.”

While the efficiency of the stimulus package is yet to be seen, a few comments can be made:

- most of the money goes to construction, whereas many consider that at least part of it could have been used better in services. It is precisely at the time of crisis, when the basic services are most needed; now the municipalities are desperate to secure them, their tax revenues going down drastically.

- The Government made the decision long demanded by the business world, i.e. it lifted the requirement for employers’ social insurance contribution (see the italics above). This means an annual income reduction of EUR 833 million in the future. The Government hopes that it will be compensated by increased tax revenues at a later stage; for the time being, the gap is being filled by additional state loan. There is no proof that the funds in question will actually have any impact on recovery, but the move may turn out to be basically an income transfer from the state to the businesses (and their owners). Besides the practical impact, one may also call into question the signal it gives on the significance of a system based on solidarity.

- The promised increases in social security benefits come in 2011, which is too late. They would be both most needed and have most effect in terms of enhancing consumption, if they were implemented earlier.

THE NETHERLANDS

Financial support(loans) for banks and other financial companies

Economical: support for companies (by proving at least 30% decrease in consumption/orders) to allow them to keep (for the company important ) employees in part-time (half of the salary-costs via unemployment regulations(law)-so they can directly restart when the situation is improving; effective for this short time for the people: they are not fired- for the companies; they can go on (slimmed but not out of business).

More orders from the government towards works of general interest(e.g. motorways, waterways c.a.)

BELGIUM

-introduction of temporary economical unemployment, also for clerks.

The system of temporary unemployment for employees/clerks is quite successful. It exists since june, already 389 companies applied, the number is still growing. It’s a measure possible for companies with a loss of 20 % are with 20 % temporary unemployment of their workers/labourers

-The ‘participation Fund’ gave companies ? already 70 % more loans than one year ago.

-tax reduction for night- and overwork, next to general tax reduction on labour

-The temporary decrease of VAT for the Construction sector had some stimulating effect, although the effect is already decreasing.

-In Flanders, there will be a big employment conference in Octobre, where an employment action plan will be developed with the goal of preventing the people who got unemployed due to the crisis, end up in long term unemployment and structural dependence on benefits

-On the national level, a ‘pensionconference’ should be ended by the december 2009

LITHUANIA

Now extremely important to restore the money to promote small and big business lending by EU funding through the European Investment Bank, European Investment Fund and other resources. Promote business viability can be maintained rapid reduction of red tape and administrative burdens on business. Party leader focused on antitrust enforcement measures.

DENMARK

The liberal governments answer to the crisis only has one element of real importance: So-called bank packages, where the state gives security and loans to banks in crisis, caused by to too many and too big loans to insecure projects, mainly in real estate.

The packages seem rather effective for consolidation of the banks, but it is not sufficient to solve problems of enterprises and private persons who need loans and credits. There are many complaints, especially from enterprises that claim to have sound projects, but cannot get them financed by the banks. This has led “the red bloc” in the parliament to suggest a recovery package for this group also, but until now without success.

FRANCE

Mesures ponctuelles et temporaires de soutien aux revenus des ménages

Mise en place du Revenu de Solidarité Active

Mise en place d’un médiateur du crédit et mesures de maintien du crédit aux entreprises

Tentatives de consolidation de l’emploi par l’extension des possibilités de chômage partiel et de son indemnisation

Nouvelle étape d’exonération de charges pour les bas salaires

Libéralisation des contrats à durée déterminée.

UK

The main element has been the enormous financial cost of support for the financial sector – the bank welfare state

· Recapitalisation of the failed banks: £36.9b for LLoyds and RBS; £18.8b for Northern Rock; £10.4b for Bradford and Bingley etc; in total £85.5b on direct financial stability measures (The Guardian 16 September 2009: pps20 -21). BBC news made it a bit higher – over £90b – see Appendix 1

· Selling of bonds (government debt) to all banks to recapitalize them to encourage them to lend again to households and businesses – but they have not really responded and the credit market is still largely frozen. Banks are using the government assets to rebuild their balance sheets. They are also taking higher profits in charges to their customers.

There has been no explicit social package – there have been automatic increases in the size of welfare bills due to rising unemployment.

EURODIACONA

There is a general feeling among our members that the focus in rescue packages is on the newly unemployed and not on those who are long term unemployed or who have been living in poverty since before the crisis. It is believed that the long term unemployed and those living in poverty will only suffer more as services are reduced and the focus is on revitalizing business and banking and increasing consumer spending.

3. What is the main social impact of the crisis and the recovery packages in general terms? How is it affecting people experiencing poverty and social exclusion?

SPAIN

In assessing the likely impacts of the downturn, the dimension of unemployment blurs the picture in Spain, with more than 6,000 new jobless persons per day during the first quarter of 2009. The incidence of joblessness is bigger among migrants, women, and also among both the youngest and the middle-aged. These vulnerable groups are most at risk of becoming or staying excluded from the labour market. Reportedly before ending 2009, nearly 4 million people among Spanish and migrant residents will turn to be unemployed. And, after some months of receiving the unemployment insurance (seguro de desempleo), they may most likely become new poors.

A Survey based on telephonic interviews to 615 individuals experiencing poverty and social exclusion, specifically focused on the impact of the crisis on their lives, conducted by the Red Cross (April-May 2009), reached to the following conclusions:

· In the past 10 months, the situation of those who suffer from moderate risk has worsened. The comparative data allows to detect an increasing proximity between the people with different risk levels, primarily because those placed in the moderate risk zone have come closer to the areas of bigger vulnerability.

· Half of the people are affected by the crisis. 56% of respondents believed that the crisis has had a big or a very big influence in their economic / financial situation last year, while 37% believed that the degree of influence has been little or none.

· Most are below the poverty threshold --almost 3 out of 10 have no income. 90% declare incomes of less than 1000 Euro. The average monthly income is 505.90 Euro, half of those interviewed admitted to a maximum 500 Euro per month. 20% of respondents declared no income and 29% have some income, but less than 500 Euro a month. 49%, almost half are in extreme poverty or absolute.

· The major problems are due to serious illness or death within the family, followed by money quarrels. 64% shares home with their families and only 19% live alone. 32% live with minors under 16 years (14% of them below the age of schooling). 30% live with people over 65 years. There are high percentages of people living with ill people (28%) and disabled (19%).

· Without any space for free-time, social or study activities: there is only some sports and religion. The social life of respondents is not at all active, as most of them (93%) does not attend bars, cafes and restaurants, 93% never frequents pubs, discos, casinos or bingo halls, 94% does not go to cinemas, theatres and concerts. In terms of day-care centres, host shelters or soup kitchens, only 9% attend frequently. 81% does not attend to adult schools, occupational or vocational training, or similar, and Internet-cafes. The trend begins to change with regard to the practice of sports, as a 25% attends the sports centers, gyms or sports areas in parks on a regular basis, or habitually. With regard to places of worship, 38% goes regularly.

· Loneliness is not the biggest problem. As for personal relations available, the situation is summarized as follows: a few close friends (35%), some important relations (51%), people who may listen to their problems (46%), but few friends or relatives to call in case of material need (only 19% ).

· Many worries, little happiness. "Optimism and enjoyment" appear in proportions similar to "gloom and anguish." However, those who are living with permanent and occasional anxiety added up to 80%. With regard to personal care, 15% had permanently self-abandoned, but there are varying degrees of casual neglect.

· Short-term personal situation shows no changes; while medium term indicates something between being at a standstill and getting better. The problems suffered in the past year include: economic / financial, health problems, and also job-related problems. Therefore, for people in vulnerable situations, there is a greater dispersion of significant problems with respect to the general population.

GERMANY

Cuts in social expenses are not yet executed (since we have parliamentary elections for the Bundestag on September, 27th) but are certainly expected in the coming years. All the governmental measures are of temporary nature and therefore will probably not suffice anymore next year to repel a considerable increase of unemployment and thereby in poverty, which is expected to continue, despite some current signs of a certain recovery. It remains to be seen if this development will take a turnaround in the aftermath of the upcoming elections in Germany with a new government in place or if the situation will still continue to deteriorate. Already by now, more and more people work in precarious employment. The short-time work arrangements put great burden especially on families, not being able to encounter their financial charges anymore. Especially the most vulnerable people, and among them families, migrants, single parents, children and old people, are going to suffer the most from the negative development.

Inevitably, by an increase of people unemployed, social security contributions will decrease and at the same time the need for social security benefits will increase by the end of this year. To add to the negative situation, despite high savings in the past, the measures taken by the government (including a huge bank guarantee programme) have led to a record state debt which – together with the high losses in social security contributions – will probably have an enormous negative impact on the stability and security of the social system in the future. The public becomes more and more aware of the fact that “somebody will have to pay the prise” – i.e. normal tax payers.

IRELAND

· Social Welfare recipients have already experienced a range of cuts impacting their incomes. Rent supplement has been reduced and the government has cut the extra social welfare payment at Christmas. Further cuts are expected although there are a number of campaigns in place to fight such cuts in the next Budget in December

· NGOs and state organisations are under growing pressure to demonstrate efficiencies in operations and to justify their budgets.

· The McCarthy report has recommended the closure of the Department of Community, Rural and Gaeltacht Affairs, the closure of the Family Support Agency and related services and sever cutbacks and rationalisation of local development organisations and services with little or no assessment of the economic and social impacts of these proposals.

· Economic context being used to justify attacks on equality, human rights, anti-racism and anti-poverty NGO’s and infrastructure.(the previously independent Combat Poverty Agency has been amalgamated into the Department of Social and Family Affairs, the National Consultative Committee on Racism and Interculturalism was closed down, the Equality Authority had a 43% budget cut and the Irish Human Rights Commission a 24% cut)

· Already cuts in services including health and education and social care supports for older people and people with disabilities as well as payments for childcare.

· Specific cuts in education supports for children for whom English is not a first language, travelers and those with learning disabilities.

· Health cuts across range of health services

· Needs of those furthest from labour market are much less of a priority as the priority moves to ensuring the newly unemployed do not move to long term unemployment

CR

See above.

Programs and recovery packages are aimed rather for companies (employers) and mainstream middle class groups than for people experiencing poverty (PEP) – this extreme target groups are rather omitted (or solved separately in social not in the crise package). PEP need dignified job opportunities, discharge from debts and social living. There are no programs to rent or built cheaper flats (e.g. social housing programmes). It makes solving problems of PEP very difficult. If they are not able to pay rent they lose the living and their children are more likely to be sent to children homes. Civic initiatives create programs helping to prevent institutional education of “social orphans” in Czech Republic. Local authorities help very little (or vice versa) to slum clearance where excluded minorities live. Only the social services and work of civic initiatives and social NGOs is therefore not enough efficient – system changes are necessary as well.

The main social impact of the crisis is rising unemployment which weighs heavily especially on people who experience poverty and social exclusion.

SWEDEN

- The confidence among the citizens regarding the reliability of the welfare system has decreased a lot.

· Note on social assistance

Social assistance: 1st – 2nd Quarter, 2009

Summary

This report presents statistics on expenditures for social assistance and introductory benefits to refugees and certain other foreign nationals in SWEDEN during the second quarter of 2009. The purpose of the report is to provide fresh quarterly data on social assistance distributed at the municipal level. The statistics are a part of SWEDEN’s Official Statistics.

Refugees are defined as asylum-seekers that have been granted residence permits and still qualify for state-financed benefits. The municipalities are entitled to reimbursement for four years of benefits for each refugee, starting with the calendar year in which they are granted residence permits. Municipalities may also apply to the state for compensation for expenditures on social assistance to certain other foreign nationals after the initial four years.

....

All of the changes over time are represented in constant prices.

Results

Social assistance, second quarter 2009

· Total expenditures on social assistance during the second quarter of 2009 amounted to SEK 2 774 million. That was an increase of sixteen per cent compared with the second quarter of 2008.

· Refugees and certain other foreign nationals received SEK 564 million in social assistance and introductory benefits during the second quarter of 2009. This is four per cent more than during the second quarter of 2008.

· Of the 270 municipalities that reported social assistance expenditures for refugees during the second quarter, 214 distributed introductory benefits.

Social assistance, first and second quarter 2009

· Total expenditures on social assistance during the first and second quarter of 2009 amounted to SEK 5 451 million. That was an increase of fifteen per cent compared with the first and second quarter of 2008.

· Refugees and certain other foreign nationals received SEK 1 120 million in social assistance and introductory benefits during the first and second quarter of 2009. This is three per cent more than during the first and second quarter of 2008.

FINLAND

The actual impact of the crisis will only be seen later. There are however signs, based on which it is feared that the unemployment will grow, the position of single parents will weaken, mothers and immigrants will find it harder to get jobs. The chronically ill will find it harder to get rehabilitation or pensions; instead, they will be left to hang around at the employment offices. Also other vulnerable groups – those, who are in a weak position even under the best market conditions – will find it difficult to cope. Generally, competition becomes harder and attitudes tougher.

THE NETHERLANDS

Banks are very carefully by investments, providing loans, mortgages c.a. The financial support by the government was given to prevent this. People are more economically with their expenditures, less consumption; pep are affected of course, because the possibility of improving their situation/ even continuation is almost lost.

LITHUANIA

People are forced to save money. Currently shows no signs of overcoming the crisis.

DENMARK

The impact of the crisis and recovery packages on poverty and social exclusion is not very clear. There might be many effects, now and in the longer run, but they are rather difficult to identify directly.

On effect to be expected is coming from the fact that the State creates an en enormous deficit in the national budget, by giving so much support to the banks and due to the growing unemployment, and at the same time maintains a stop for increases in taxes, which has been the governmental policy since 2001.

These components will for sure leave fewer money to public support of the poor and socially excluded and will also lead to a growing gap between rich and poor and makes it more difficult to integrate the excluded.

The effect is shown in several studies. There are a growing number of people living under the poverty line, as defined by EU: less than 60% of the average income. Still less than in most other countries, as DENMARK still is one of the richest countries, but our welfare system erodes and the principle of flexicurity seems to be more popular outside than inside DENMARK.

FRANCE

Il est certainement trop tôt pour mesurer pleinement à la fois l’impact de la crise et celui des mesures prises pour en combattre les effets.

UK

Unemployment is affecting less skilled workers and older workers and youth. There are now 1 million young people not in paid work.

POSITIVE POLICY POINTS ON THE SOCIAL SIDE TO DEAL WITH THE CRISIS

Remembering the trouble we got from UK government over negative comments about UK last time, some positive points are. These could probably go in under Q3 in the questionnaire

CHILD POVERTY

That UK government although it missed its 2005 and will miss its 2010 Public Service Agreement target on child poverty, the targets have focused policy attention on child poverty, to positive effect. Despite the financial crisis, the government has continued with its 2020 target and put in a legislative framework, in the Child poverty Bill of 11 June 2009.

SUPPORTING YOUNG PEOPLE

· Future jobs fund is aimed to create jobs for young people – government claims, up to 85,000 jobs and training places including internships. Overall the government believes that 150,000 extra jobs will be created, mainly for 18-24 year olds who have been out of work a year. The money is to be spent between October 2009 and March 2011; the Fund is part of the Young Person’s Guarantee so that by 2010 every 18-24 year old will be offered at least 6 months of a job, training or work experience. The Fund is bid for competitively

· More places at university created this year - though not fully funded to the universities and only for about a third of the extra demand for places due to recession

· Government would also say that the radical changes it was making to skills delivery mechanisms which are continuing despite the crisis will help young people

DISADVANTAGED GROUPS

· Continued to put through law on access to statutory sick pay for agency workers with contracts of 3 months or less

· Government would also say that in continuing with its welfare reforms, it is providing additional support as well as compulsion for people with a disability and single parents

TO MAINTAIN EMPLOYMENT DEMAND

· maintaining and bringing forward capital projects for schools, homes and hospitals to keep employment up

· Car scrappage scheme – and extended for 6 months more

· targeted tax cuts for business

SUPPORT FOR MORTGAGE INTEREST

The government is maintaining support at assumed interest rates higher than actual current rates

But what there is not is a social package and we have asked for a social summit to discuss and conclude on social impact of the crisis and next steps

Eurodiaconia

As per question 2. However, there is also the need to think about the emotional impact of thecrisis and the concept of hope. More and more people are and may start to see the situation as hopeless and that there is no care and support for those in the deepest need. Therefore, in some cases, mental illness may increase which will also need support.

A) In what areas is the impact most felt and how? Give details and examples where relevant if possible.

· Employment (what kind of jobs are affected and in what way? Is there an impact on quality of job conditions – eg increase in temporality/short-term working? Are new jobs are being created? What about their quality? Is support being given to Social Economy? What’s the impact on activation policies? Are measures being taken to increase access to jobs for the unemployed? What’s happening to conditionality?)

SPAIN

In April 2009, 100 economists made a diagnosis and some key proposals about fixing the unstable Spanish labor market. Quotation:

“The current economic crisis did not start in the labor market. However, Spain is suffering a much higher job destruction rate than most developed countries. With an unemployment rate around 15%, and which could reach 20% in the next few months, it is urgent to tackle the causes that generate such an intense job destruction. Neither fiscal stimulus packages nor employment-promoting measures –for instance the already-approved job creation subsidies– will be effective if the main problems that induce such an inefficient performance of the Spanish labor market are not solved. Those problems explain the huge gap between our unemployment rate and the euro area average (8%), and without fixing them it will not be possible to create enough jobs in high-productivity industries once the international economic conditions return to normalcy.”

a) What kind of jobs?: The most affected are the construction, services and manufacturing sectors, where most of the jobs were created in the last years. Many of these jobs were taken by migrant workers, who have been the first most affected by the downturn.

b) Quality: More work, in less time, and for a lower salary --Take it or leave it. Quality of job conditions are negatively affected due to the “real” or the “alleged” crisis. Employers feel they can lower working conditions because of the abundant work supply. Without valid work-permits, migrant workers are prevented by law from organizing or applying to register a trade union and suffer from harsh working conditions.

c) New jobs: The EPlan 2008-2009, already mentioned, was intended to create more jobs, but it seems that have failed in general terms, as funds were placed in low productivity and short-term ventures by local authorities. Measures differ from one regional government to another, depending on political orientation and availability of transferred national funding. In the last year, unemployment rose more in Canarias, Murcia, Cantabria and Castilla-La Mancha, also significantly in Navarra (93.63 %), Aragón (92.15), Cataluña (81.02), La Rioja (75.74) and Comunidad Valenciana (70.99). Below the national average (66.42 %) there were Madrid (64.90), Castilla y León (63.68), Andalucía (62.26), País Vasco (45.81), Baleares (41.84), Galicia (33.65), Asturias (26.42) and Extremadura (23.15).

d) Social Economy: the sector is not specially flourishing, as deflation is affecting all areas of economic activity.

The Forum of the Third Sector and the Social Economy is a joint initiative of 5 social platforms and networks. They demanded a National Pact for Jobs and Social Inclusion and made proposals to the government (January 2009). Their key recommendations were:

1. To incentivize the economy and employment

2. To implement training and support measures to help in the transition from unemployment to employment, and to return to the education system as well.

3. To strengthen the support for social protection and social services.

4. To strengthen the Social Third Sector.

There are some interesting initiatives, at the regional level, addressing some of the most crucial social and economic problems, like the Self-Financed Communities, -- a good example.

e) Unemployment and precariousness affecting people already facing poverty and social exclusion before the crisis:

(Source: the abovementioned Red Cross’ Survey)

· Unemployed and employees: precariousness, insecurity and low income. Many salaried employees work in the domestic and proximity services sector. Two groups can be clearly distinguished: those with permanent contracts, 35%, and those who have no contract, 20%. In this portrait of the precariousness, 26% had changed jobs in the last year.

· Almost 7 out of 10 said that there had been recent layoffs at their workplace, an average of 18 workers per site, in the last year. Despite this, half of respondents does not feel their jobs are endangered, while the other half believes they are.

· As for the unemployed, stressing that only 20% received unemployment benefits. Although 56% is actively seeking work, only 13% of the unemployed received any job proposal in the last month (April 2009). The reasons for unemployment are several, the most common: the end of the contract (20%), family / personal reasons (15%), failure to have legal work-permits (12%) and illness or health problems (12%) .

GERMANY

Temporary jobs are significantly being reduced. Especially young professionals lose their jobs or have difficulties finding a – new – job.

No particular financial support is given to Social Economy.

No specific measures are taken to increase access to jobs, policy focus is on measures to keep people in the job.

IRELAND

What kind of jobs are affected and in what way?

· The main areas of job losses initially were in Construction and related occupations followed by wholesale and retail and repair of motor vehicles and motor cycles. This has now spread more generally as the effects of the recession impact on consumer spending. However exports have held up well and there are major pressures to improve competitiveness and to reduce both pay and non-pay costs, including pressure from employer groups to cut the minimum wage. .

Is there an impact on quality of job conditions – eg increase in temporality/short-term working?

· While there has been a large decrease in full-time working there has been a small increase in part time work, mainly by men. Many people in the private sector have also taken a cut in pay.

Are new jobs are being created? What about their quality?

· No real sign of new jobs being created but the Government is looking at the creation of new ‘Green’ jobs.

Is support being given to Social Economy?

· No sign of any developments in this area

What’s the impact on activation policies? Are measures being taken to increase access to jobs for the unemployed? What’s happening to conditionality?)

· The Government focus is on the recently unemployed and resources and supports being targeted at those distant from the labour market are now being redirected

Minimum Wage

· The Government is currently looking at proposals to reduce the guaranteed minimum wage.

CR

Unemployment between April and June 2009 in the Czech Republic rose up to 6.4 percent. According to the Czech Statistical Office (CSO) i tis the highest annual increase since 1999. Without work is to this date 333 900 people. Most affected are in Karlovy Vary, Ústí and Moravia-Silesia region – over 9 percent.

Increase in unemployment affected mainly industry and construction. The most affected areas are glass, ceramics, textile, car industry. Manufacturing corporations release workers and then fail. The situation is worse in greater agglomerations (eg. Nothern Moravia). New jobs are creating slowly. Social Economy enjoyes no or very small support, also it seems to be little efficient. Activation policies are expensive but little effective as well.

High unemployment remains in a group of people with basic education. Also PEP do not get or lose more often “black market jobs opportunities in construction work” – work without taxation and legal basis which increased their regular social benefits income (though illegally). Therefore social tension is slightly increasing eg. among socially excluded Roma together with increasing extremism support within population (increase of political visibility of ultra-right nationalist parties such as The workers party - Delnicka strana, The national party - Narodni strana etc.).

Many companies shorten working hours of their employees without refund.

SWEDEN

The unemployment is expected to increase for several years and to reach it´s peak 2011 with around 12% from around 9% today. In some places the employees and the employers have taken a large responsibility in developing models for decreasing working our and salaries. The social economy has not yet been used to its full potential.

FINLAND

The growing number of the newly unemployed will worsen the already difficult situation of the long-term unemployed, who are the last ones to get a job. Actually, the pressure to find jobs is shifting from the employment offices to associations of the unemployed. At the same time, conditions for financial support to these associations have been tightened, which means operational limitations.

FINLAND

Indebtedness – both private, personal and public – will grow

THE NETHERLANDS

Jobs in the financial orbit, road/housebuilding sector, administrative jobs—dismisses; there is an attempt to decrease the job conditions, but the trade unions are fighting to keep them and indeed there is an increase of temporally/short-term jobs; there are some new, low paid and less secure jobs; it depends on what you mean by Soc. Economy—yes there is support (accompany and financial) for people who starts their own small business(ZZP-zelfstandige zonder personeel= independent person without staff). (e.g. market-sellers, cleaners, coaches);

Activation policy is still going on, but the jobs are less and not so qualified; it was already happening before- access to jobs difficult if you are long-term-unemployed, your age (above 35/40), your education; conditionality is (still) part of the activation –policy, by re-integration is training and some education included.

BELGIUM

- Jobs in construction, transport and industry sectors are strongly affected: eg. 20 % less goods in the Antwerp Port, harbour workers are 3,5 times more unemployed then last year. This means the highest level of days of unemployment since word war II

-106.000 more people temporary unemployed then last year (DS 22/08)

- Activation policies stayed unchanged, which means that also the same number of consultants, social assistants… are consulting a much bigger number of unemployed people

- Waiting lists for training courses became longer

- Labourmarket is very conservative nowadays: who’s out stays out

-for the first time ever over 100.000 unemployed in the Brussels Region

LITHUANIA

The biggest increases in unemployment - 14 percent. The majority of work lost its builders, bankers, computer science, middle managers

DENMARK

Jobs affected are mainly those for unskilled workers, and jobs in specific branches as construction.

The Quality of jobs is affected in relation to milieu, stress and insecurity.

Access to jobs for unemployed is tax – financed and supported by public and private job services, but as the crisis has resulted in fewer jobs in general and in specific areas especially, it has been more difficult for unemployed to have success in getting a new job. People who have social or health’s problems and lacks education, experiences more difficulties in getting jobs.

FRANCE

On a assisté à une forte baisse du travail intérimaire avec stabilisation au deuxième trimestre 2009 et à un non-renouvellement de contrats à durée déterminée. Ce sont donc les travailleurs précaires qui ont été les premiers touchés par la crise et la diminution du nombre d’emplois.

En ce qui concerne les mesures prises pour permettre aux demandeurs d’emploi d’accéder à l’emploi, outre celles prises pour inciter les entreprises à embaucher, on observe un quasi décontingentement des emplois aidés, la limite étant la capacité des organisations (associations notamment) à y recourir et à pouvoir en financer l’encadrement

UK

Employment data from National Statistics Online, accessed 28 September 2009

· The employment rate for 3 months to July 2009 has fallen to 72.5%, lowest since 1997

· Total in employment for year to June 2009 is 28.89 million, down 600,000 on the year

· There are 31 million workforce jobs in the year to June 2009, down 664,000 on the year

· The unemployment rate is 7.9% for the three months to July 2009, the highest since 1996

· The claimant count (registered unemployed because they are entitled to benefit) was 1.61 million in August 2009, highest since 1997. Note: these are statistics for the registered unemployed and are therefore much lower than the labour force statistics of ILO, which count people able, willing and currently seeking work, whether registered or not.

· Redundancies in the three months to 2007 were 246,000 down 55,000 over the last quarter, but 107,000 up on the year

· Job vacancies were 434,000 in the three months to August 2009, down 174,000 over the year.

· Inactivity rate for working age people was 21.1% for the three months to July 2009, there are now 7.99 million inactive people of working age, up 125,000 on the year and the highest since records began in 1971

· Average earnings excluding bonuses increased by 2.2% in the three months to July 2009, compared with the previous year, the lowest since records began in 2001. Average earnings, including bonuses, increased by 1.7% in the same period

The negative trend in employment has accelerated - in the last four quarters the percentage change in employment growth rates for the UK were: -0.3; -0.2; -0.5; -0.9 (Eurostat newsrelease: Euroindicators; 14 September 09)

There are a number of reasons for believing that the total employment impact of the crisis is undercounted by registered unemployment

· There is an increase in short time working which a bit disguises the true employment impact of the crisis. Ditto, it seems likely that there are people who are forced to work part time who would prefer full time

· Agency workers seem to have been first to lose their jobs as they are contracted to the agency and not the place where they work

· Some self employed people who have lost their business or self employed contracts will not appear in the unemployment statistics because they are not entitled to benefits and therefore may not register as unemployed, but run down their savings, before being forced to seek income or housing support

· It is not evident what is happening to informal workers including asylum seekers and those working while on benefit, who will not appear in unemployment statistics because they were working illegally

· Some unemployment has been disguised by an exodus of east Europeans especially Polish people

· Young people are not being hired into their first job. Graduate unemployment is rising but is still lower than for less skilled youth. However, some graduate unemployment is disguised as more graduates have sought further study as there is less scope for employment. Some large employers such as British Telecom have ended their graduate entry programmes

· Homelessness and Housing Exclusion ( Is homelessness increasing? Are there increases in evictions and repossessions? Is there an impact on rent levels and access to housing?)

SPAIN

Homelessness and housing exclusion are increasing. Recently unemployed people with pending mortgages, and tenants who cannot afford their mortgages and rents are beginning to loose their homes. Families and particularly children, already at risk, are not covered by the traditional “social emergency” resources and facilities. As basic social services, soup centers, shelters, drop-in centers and other such services managed by NGOs and private charity are facing a big increase in demand, while finding it harder to bring in donations and subsidies, the costs in terms of hunger, homelessness and illness will soon be very important indeed.

According to the Red Cross’ Survey, serious problems with housing were faced by almost 3 out of 10 persons, who were already facing social vulnerability before the crisis. 28% of respondents have reported having serious problems with regard to the maintenance of their homes, with two highlights: the inability to pay the rent, and not being able to afford electricity, gas, telephone or community expenses. Many have requested the Red Cross and the social services aid, but 29% of those who can not afford the rent had not requested assistance.

Considering the Survey conducted by the Caritas Center for Homeless Persons, in April-May 2009, the number of homeless people increased slightly (21%) during 2008. The report showed that some people affected by the crisis are beginning to use the facilities for homeless people, in the absence of other alternatives. Many Caritas offices indicate that the crisis is still not massively dragging the people to homelessness. However, when analyzing data from the first quarter of 2009, the increase reaches a remarkable 30%. This is due mainly to homeless migrants: while natives only increased by 17%, the immigrants have done so by 68%.

The profile and characteristics of these homeless groups are:

· A preponderance of men (90.5%)

· A bigger weight of the native (72%), compared to the homeless immigrants (28%).

· The average age of 39.7 years, with a clear distinction between:

· Immigrants, with an average age of 36 years.

· Natives, with an average age of 43.4 years.

The main cause of chained factors that lead to homelessness in 2008 were: loss of job (abandonment, dismissal or termination of contract), followed by addictions (alcohol, drugs, gambling). Other causes are also related, such as the difficult labour insertion, the loss of a residence and work permits, and the lack of family support. In the case of homeless migrants, the report highlights the difficulty of accessing to employment (mostly due to discrimination) and their “irregular” administrative conditions. Caritas services indicate that 63% of the homeless persons move from one locality to another (most often, in the case of immigrants), while 37% remain in the same location (more common, among natives).

GERMANY

It is not yet possible to quantify the likely increase of homelessness. We are expecting to perceive impacts next year.

IREALND

· Homeless organisations have been reporting an increase in homelessness and those seeking their services for the past year. Many of these people are migrant workers, mainly from Eastern Europe, who have lost their jobs.

· There has been an increase in house repossessions but the Government has intervened to try to prevent this move. Recently Courts have also found in favour of mortgage holders over lenders.

· In general there has been a reduction in the cost of renting. However the state has also reduced the rent supplement paid to social welfare recipients.

· In April the Government cut the Rent Supplement support to those on low income and social welfare citing reduced rents. However, many tenants have not been able to negotiate a reduction in rents with their landlords leading to increased poverty for these people.

· Many houses build by developers are now empty. Homeless organisations have called for these to be purchased by local authorities to address the needs of those on the social housing waiting list and those who are homeless. The Government has provided some funding to local authorities to rent some of these houses to address some of the needs of those on the social housing waiting list.

· Most planned social housing regeneration projects involving public private partnerships have collapsed.

CR

Homelessness is not increasing but not diminishing. Restrictive programs are not effective – the homelessness communities are rather more diffused. At the moment problem with day care center Hope for homeless near to Prague Main Railway Station is negotiated. The quarter Prague 1 will push the center form the city of Prague to margins of the Prague. Civic initiatives defense the successful project Day Centre Hope asking local government to let live the center because it is located in very appropriate place – under the highway, close to the Main Railway Station. There is lack in access to housing not only in Prague but in the smaller cities in Czech Republic (see scandalous behavior of mayoress in Chomutov). People they are not able to pay rent are reject without to plan the future steps for them.

No social housing law – lack of affordable rent, discrimination on “free market” – private owners often discriminate PEP, families with small children, Roma in renting. No or lack of affordable state or council flats complicates this issue.

The reality of lower wages (shortening working hours) bring along the growth of distraints and indebtedness of individuals and families (inclusive indebtedness in connection with rents and distraints of flats or homes).

SWEDEN

· The number of people who are forced to sell their homes (houses and apartment) due to debt are increasing. The number of people who are legally forced to sell has been doubled since 2007 and 2009. The underlying problem is mainly unemployment. The expected increase of people being to forced sell their homes is also related to an expected increase of the rate of interest.

· The number of homeless people can also bee expected to increase since more and more people are living on the margins.

THE NETHERLANDS

Homelessness among youngsters is a little (slowly) increasing; there are still evictions –this has more to do with people who cannot longer afford to pay the mortgage of their house (but they will have a (rented)house a.s.a.p.); the rent-level (for housing-corporations) is regulated by the government, so every year there is a small % (3-5%) raising of the rent. (private house-owners can let their houses for more, but now let them for less).

BELGIUM

- Five times less building permits are requested (DS 08 08), which means a decrease of 21 %. This might have an impact on the (already problematic) scarcity of houses to rent.

- ‘Insurance for housing guarantees’

A free public insurance, people who are having problems paying their hypothetical loans due to illness are unemployment, can use this insurance.

The insurance is now also possible for higher income levels. The minister is now researching if a similar insurance for people who rent a place is possible (Gazet van Antwerpen 17 09)

DENMARK

The number of homeless seems to be on a stable level. There seems also to be no increases in evictions. Yet, the number of repossessions is growing rapidly, even if it is still not big, compared to e.g. the 1980th.

Rent level is decreasing, yet still to high for poor people. Access to housing is also easier as there are many empty, newly build flats, but the rent is too high for poor and socially excluded.

The government has just started a program for reducing the number of homeless. The idea is to set up more flats, aimed specifically for homeless. “Housing first” is one of the buzzwords, underlining the hope that homelessness primarily is a housing problem.

LITHUANIA

Labor has lost depending on what activities the area has worked

UK

There was an increase in evictions and repossession of houses but the rate of increase has declined in the last quarter. The situation varies with landlords but government had been encouraging banks to make repossession/ eviction a last resort and has provided some support for people to stay in their homes. I do not know the situation with social landlords – some of them were moving quicker to eviction for rent debt before this crisis.

MINIMUM INCOME

SPAIN

If long-term unemployed people have to turn to is the welfare system, they will face a devastating shock. The unemployment insurance, while it has highly restrictive rules, considers eligibility from the standpoint of unemployed status. The Guaranteed Minimum Income (rentas mínimas), in contrast, is a system of last resort that can only be accessed by those on the very edge of destitution. In most of the Spanish Regions, those with any other sources of income are ineligible by reason of the welfare means tests. In conditions of rapid economic downturn, that will translate into a whole mass of people who are without work but who cannot even apply for income support until they have exhausted their savings. Once they have reached the required level of poverty, those who were previously working for living wages will be expected to make do with the degrading pittance that GMI provides, in their current levels.

The social assistance system is massively arbitrary in its actual implementation and regional and local governments have to co-finance for part of it. Local governments are dragging a public debt of nearly Euro 30,000 million, and will surely face expenditures cutting measures in the months ahead. In such a situation, it is to be expected that local welfare offices will engage in an intensified drive to deny entitlements. If the crisis becomes deep enough and caseloads reach a high enough level, the very viability of welfare provision will be called into question.

According to the Caritas Report, which coincides with the Red Cross’ Survey, most people who seek aid do not get the Minimum Income. Even when the MI granted, there is a 98-day delay before payment, due to bureaucracy, budgetary scarcity and shortage of human resources to manage the system.

GERMANY

Not yet

IRELAND

· The Government is considering proposals to cut the Minimum social welfare payment by 5% at the end of 2009.

· While the Minimum social welfare payment has not yet been cut criteria for certain groups has and also criteria for access to social welfare benefit has been made more diffi