Government expenditure on social security benefits increases

31st October 2019 

When compared with last year, there has been an increase of 3.7% in social security benefits.

During the first three quarters of 2019, an increase of €26.9 million was reported in Social Security Benefits outlay when compared to 2018.

By the end of September 2019, Social Security Benefits amounted to €752.9 million. This is equivalent to a 3.7 per cent increase over 2018, according to a press release issued by the National Statistics Office (NSO) on Thursday morning.

Both Contributory and Non-Contributory spending rose during the period in question, with the former accounting for €26.3 million or 97.7 per cent of the total rise in social outlay.

Contributory benefits refer to Government expenditure on social benefits where the individual has also contributed through employment. Benefits payable under this scheme are subject to a contribution test. Non-contributory benefits are in place as a safety net for those close to the poverty line and are not based on any contributions.

Contributory Benefits expenditure totalled €611.2 million, 4.5 per cent higher than 2018. This increment was due to a €20.8 million rise reported under Pensions in respect of Retirement, which resulted from a higher number of Two-Thirds pensioners. Further increases were registered in Pensions in respect of Widowhood (€3.8 million), Contributory Bonus (€2.1 million) and Other Benefits (€0.1 million). Conversely, Pensions in respect of Invalidity declined by €0.5 million.

Non-Contributory spending amounted to €141.8 million, a 0.4 per cent increase from 2018. The biggest increases in Non-Contributory expenditure were reported under Disability Pension/Allowance (€2.2 million) and Old Age Pension (€1.9 million).

In addition, there were also positive growths in In-Work Benefit, Medical Assistance (both €0.5 million) and Non-Contributory Bonus (€0.1 million). On the other hand, Total Social Assistance and Supplementary Assistance spending dropped by €4.2 million and €0.4 million respectively.

Between July and September 2019, Social Security Benefits outlay reached €240.9 million, of which 81.3 per cent was spent on Contributory benefits. This represents an €11.9 million increase over the €229.0 million recorded during the third quarter of 2018. This was mainly the result of increases in the contributory Pensions in respect of Retirement (€7.6 million) and Widowhood (€2.8 million).

Social Security Beneficiaries

By the end of September 2019, Two-Thirds Pension registered the largest cohort of recipients at 50,562 persons, coupled with the biggest year-over-year rise of 2,129. In contrast, the National Minimum Widows’ Pension reported the largest drop in beneficiaries with 623 less persons reported than the corresponding period of 2018.

The largest share of Non-Contributory recipients was registered under Children’s Allowance (41,611), in spite of reporting the largest drop in beneficiaries at 1,482. On the other end of the spectrum, In-Work-Benefit recipients exhibited the largest increase of 608, amounting to 4,625 persons. Quarter-wise was a similar story with the Two-Thirds Pension (49,493) and Children’s Allowance (40,000) reporting the largest cohorts of Contributory and Non-Contributory beneficiaries respectively.

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