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Daily: Govt considering cutting unemployment benefit by 100 - 250 days

The daily Helsingin Sanomat reported Sunday that government is looking into plans to reduce the duration of earnings-based unemployment benefits. One of the proposals under consideration by a working group would cut the duration of the 500-day benefit by half to 250 days.

Lomake.
Image: Timo Jaakonaho / Lehtikuva

According to the paper a government working group has tabled a proposal to reduce the duration of the current 500-day unemployment benefit by 100 days. If agreed, the proposal would come into force from 2017.

The working group, which also includes labour market representatives, is also considering another proposal that would shorten the duration of the benefit by half - up to 250 days. That model had already been on the table during government formation talks, the paper said.

The group is said to be considering a variety of proposals but the plan to cut the duration for unemployment benefit by 100 days to bring it down to 400 days so far has the greatest support and would save between 150 and 170 million euros.

Govt: Two-year benefit too long and expensive

The government says that the nearly two-year benefit period is too long and costly and makes recipients passive, preventing them from looking for work.

The government hopes the move to reduce the length of time for which the unemployment compensation is paid will save some 200 million euros.

The Ministry of Social Affairs and Health is to roll out proposals to reduce spending by mid-October and draft legislation is expected to come before Parliament next spring.

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