Government proposes changes to housing costs recognised under the social assistance scheme
There are municipality-specific maximum limits for the amount of housing costs that can be recognised under the social assistance scheme. Kela can recognise housing costs that exceed the maximum limit if there are special grounds for this. The Government is now looking for savings to public finances by proposing further limits to what counts as special grounds.
The Government has submitted a proposal to Parliament concerning the recognition of housing costs under the social assistance scheme. The proposal is largely in line with Kela’s current practices: There are municipality-specific maximum limits for the amount of housing costs that can be recognised under the social assistance scheme. If a recipient of social assistance has housing costs that exceed the maximum limit, Kela will tell them that they need to look for more affordable housing within three months’ time, unless they have special grounds for staying in their current home. This time limit can be extended if there is a good reason for doing so.
The proposed legislative amendment would not bring about any major changes to the current practices. Mostly, it would make the criteria for recognising housing costs clearer by codifying them in an act and a decree. However, the amendment would in some respects tighten the criteria for recognising housing costs that exceed the maximum limit. For example, going forward, Kela would no longer have the right to employ discretion in situations where the housing costs exceed the maximum limit by a minor amount.
Circumstances that would continue to constitute special grounds include the advanced age or poor health of the recipient or a family member, as well as a non-custodial parent’s need for additional space for parent-child visits. In order to ensure that the change does not negatively affect families with children, the best interests of the child would also qualify as special grounds.
However, if there is no housing that meets the criteria for maximum housing costs available in the area where the recipient lives, this would no longer constitute special grounds under the new amendment. It would be on the customer to prove that they have looked for more affordable housing using all the means at their disposal. If the customer fails to find more affordable housing within the designated time limit despite actively looking for it, the time limit can be extended.
With this legislative amendment, the Government is looking for savings to public finances. The proposal is linked to the Government budget proposal for 2024 and the amendment is to enter into force on 1 April 2024. Kela will provide further information as the review of the Government proposal progresses in Parliament.