for the period of July 1, 2019 to June 30, 2020
by the Government of the Republic of Estonia on measures implementing the provisions of the European Code of Social Security signed by the Government of Estonia on January 24, 2000.
The provisions of the Code are connected with the following legal acts in Estonian social security system.
Acts:
1) Health Insurance Act – parts II, III, VIII;
2) State Pension Insurance Act – parts V, IX, X;
3) Labour Market Services and Benefits Act – part IV andXII;
4) Unemployment Insurance Act – part IV and XII;
5) Work Ability Allowance Act – part IX;
6) Family Benefits Act - part VII and XII;
7) Social Tax Act – parts II, III, V, VI, IX, X, XII;
8) Administrative Procedure Act – part XII.
The legislation can be accessed in Estonian and English at www.riigiteataja.ee.
A. Administration/Organisation
No important changes during the reporting period.
Administrative organisations:
Unemployment benefit
· Estonian Unemployment Insurance Fund (https://www.tootukassa.ee/), under the supervision of the Ministry of Social Affairs (http://www.sm.ee/) registers the unemployed and pays benefits.
· Tax and Customs Office (https://www.emta.ee/) collects contributions.
Old-age pension, disability benefits and survivors’ pension
Universal, social insurance, and social assistance
· Ministry of Social Affairs (http://www.sm.ee/) is responsible for general management and supervision.
· Social Insurance Board (http://www.sotsiaalkindlustusamet.ee/) is responsible for overall planning and coordination.
· Estonian Unemployment Insurance Fund (https://www.tootukassa.ee/) administers the work ability allowance (since July 1, 2016).
· Tax and Customs Office (https://www.emta.ee/) collects contributions.
· Local governments pay the funeral grant.
Mandatory individual account
· Ministry of Finance (http://www.fi.ee/) supervises the Financial Supervisory Authority and the Registrar of the Estonian Central Register of Securities.
· Financial Supervisory Authority (http://www.fi.ee/) supervises financial services providers, including pension management companies and life insurance companies.
· Registrar of the Estonian Central Register of Securities (https://nasdaqcsd.com/) sets up a pension account for each insured person.
Sickness benefit and maternity benefit
· Ministry of Social Affairs (http://www.sm.ee/) is responsible for general management, supervision, and planning.
· Health Insurance Fund (https://www.haigekassa.ee/) coordinates health insurance and administers benefits.
· Doctors, polyclinics, and hospitals provide medical benefits.
· Tax and Customs Office (https://www.emta.ee/) collects contributions.
Family benefits
· Ministry of Social Affairs (http://www.sm.ee/) is responsible for general management and supervision.
· Social Insurance Board (http://www.sotsiaalkindlustusamet.ee/) coordinates and administers benefits.
· Local governments pay the subsistence benefit.
B. Benefits
Changes made and planned for each benefit scheme have been reported in the relevant sections of this report.
II. MEDICAL CARE
a) Changes made during the reference period
No significant changes(persons protected, contingencies covered, cost-sharing) duringthe reporting period.
Extension of the revenue base of the Estonian Health Insurance Fund
The government allocated additional monetary resources (213M €) for health insurance fund to cover medical costs that are related to COVID-19 activities and treatment.
Extension of emergency care definitions due to COVID-19
During the COVID-19 situation the definition of emergency care was extended – health insurance fund covers uninsured persons cost if there is doubt that the person can have the virus or the person has been in contact with other person who has had the virus.
Article 9
A. The recourse is had to Article 9 (c) of the Code.
B. The protected persons are defined in the Health Insurance Act, § 5 subsection (1) - “an insured person is a permanent resident of Estonia or a person residing in Estonia on the basis of a temporary residence permitor the right of residence or a personlegally staying and working in Estonia based on a temporary ground for stay for whom a payer of social tax must pay social tax or who pays socialtax for themselves in accordance with the procedure, in the amountsand within the time limits provided for in the Social Tax Act, or a person considered equal to such persons on the basis of this Act”.
C. Statistical information (Part III Article 74)
(a) Number of insured persons at Estonian Health Insurance Fund as of December 31, 2019 was 1 262 381 (Estonian Health Insurance Fund);
(b) Total population as of January 1, 2020 was 1 328 976 (Statistics Estonia);
(c) Number of insured persons amounted to 95% of the total.
a) Number of insured persons
|
Insured persons |
|
|
31.12.2019 |
1 262 381 |
|
31.12.2018 |
1 251 617 |
|
31.12.2017 |
1 240 927 |
|
31.12.2016 |
1 237 277 |
|
31.12.2015 |
1 237 336 |
Source: Estonian Health Insurance Fund
b) Total population (beginning of the year)
|
Total population |
|
|
01.01.2020 |
1 328 976 |
|
01.01.2019 |
1 324 820 |
|
01.01.2018 |
1 319 133 |
|
01.01.2017 |
1 315 635 |
|
01.01.2016 |
1 315 944 |
|
01.01.2015 |
1 313 271 |
Source: Statistics Estonia
c) Number of insured persons per cent total population, %
|
% |
|
|
2019 |
94,99 |
|
2018 |
94.47 |
|
2017 |
94.07 |
|
2016 |
94.0 |
|
2015 |
94.0 |
|
2014 |
93.9 |
b) Changes decided, planned or proposed for the following year
Currently we are carrying out the analysis about problems of health insurance coverage and health insurance financial sustainability. There are proposals to the government to extend the coverage to reach to universal health coverage. Also, there are proposals to broaden health insurance system financing. This analysis and proposals should be ready in the September of 2020.
Also, we are analysing out of pocket payment on a personal basis and preparing proposals to redistribute the out of pocket payment. This analysis and proposals should be ready in the end of 2020.
c) Research (including evaluation), completed or initiated
See previous point.
III. SICKNESS BENEFIT
a) Changes made during the reference period
No significant changes (persons protected, contingencies covered) during the reporting period. During the COVID-19 state of emergency a change was made – the sickness benefit was paid from the first day of sickness. This change was in force until the end of the state of emergency.
Article 15
A. Recourse is had to Article 15 (b) of the Code.
B. No changes.
C. Statistical information (Part II, Article 74):
a) Number of economically active insured as of December 31, 2019 was 639 904 (Estonian Health Insurance Fund);
b) Total population as of January 1, 2020 was 1 328 976 (Statistics Estonia);
c) Number of economically active insured made up 48,2% of total population in 2019
a) Number of economically active insured (end of the year).
|
Number of economically active insured |
|
|
31.12.2019 |
639 904 |
|
31.12.2018 |
632 428 |
|
31.12.2017 |
618 289 |
|
31.12.2016 |
604 781 |
|
31.12.2015 |
615 333 |
Source: Estonian Health Insurance Fund
b) Total population as of (beginning of the year)
|
Total Population |
|
|
01.01.2020 |
1 328 976 |
|
01.01.2019 |
1 324 820 |
|
01.01.2018 |
1 319 133 |
|
01.01.2017 |
1 315 635 |
|
01.01.2016 |
1 315 944 |
Source: Statistics Estonia
c) Number of economically active insured of total population, %
|
% |
|
|
2019 |
48,2 |
|
2018 |
47.7 |
|
2017 |
46.9 |
|
2016 |
46.0 |
|
2015 |
46.8 |
b) Changes decided, planned or proposed for the following year
Currently we are carrying out the analysis about problems of health insurance coverage and health insurance financial sustainability. One part of this analysis is sickness benefit. There is a proposal to transfer the funding of sickness benefit from health insurance fund to unemployment insurance fund. Also, there is a proposal to extend employers’ contribution in the case of work accident and to work out a system when and how people could work during the long sickness period. This analysis and proposals should be ready in the September of 2020. Though, implementation would not be possible earlier than 2021.
Secondly, as a preparedness measure for the future, it is currently under discussion whether and how to increase employee’s motivation to stay at home the first three sickness days which are currently not compensated. The measure was introduced during the crisis to limit the infection risk when the national sickness fund did compensate also for the first 3 days. Though, these discussions are in early stage.
In 2022, the financing of maternity benefit is merged under a joint system of parental leave, which will be financed from the state budget and by the Social Insurance Board. The level of the benefit will remain the same.
IV. UNEMPLOYMENT BENEFIT
a) Changes made during the reference period
No significant changes (persons protected, contingencies covered) during the reporting period.
Article 21
A. The recourse is had to Article 21 (a) of the Code.
B. No changes.
C. In 2019, according to Estonian Tax and Customs Board, unemployment insurance premiums were collected from 658 194 insured persons. The total number of employed and unemployed persons was 702 600 in 2019 (according to Statistics Estonia). Therefore 93,7% of the total number of employed and unemployed persons was insured.
Number of insured persons by collection of unemployment insurance premiums
|
Insured persons |
|
|
2019 |
658 194 |
|
2018 |
641 913 |
|
2017 |
623 518 |
|
2016 |
613 899 |
|
2015 |
612 216 |
Source: Estonian Tax and Customs Board data
Total number of employed and unemployed persons
|
Total |
|
|
2019 |
702 600 |
|
2018 |
702 400 |
|
2017 |
698 800 |
|
2016 |
691 400 |
|
2015 |
683 100 |
Source: Statistics Estonia
Number of insured persons per cent of total number of employed and unemployed, %
|
% |
|
|
2019 |
93.7 |
|
2018 |
91.4 |
|
2017 |
89.2 |
|
2016 |
88.8 |
|
2015 |
89.6 |
In 2019 the unemployment insurance premiums from insured persons added up to 135 726 euros and the unemployment insurance premiums from employers added up to 73 083 euros.
|
Unemployment insurance premiums from insured persons, thousand euros |
Unemployment insurance premiums from employers, thousand euros |
Total of unemployment insurance premiums, thousand euros |
|
|
2019 |
135 726 |
73 083 |
208 809 |
|
2018 |
123 654 |
66 583 |
190 237 |
|
2017 |
112 824 |
60 751 |
173 575 |
|
2016 |
103 472 |
55 715 |
159 187 |
|
2015 |
97 376 |
52 433 |
149 809 |
Source: Unemployment Insurance Fund data
b) Changes decided, planned or proposed for the following year
In June 2020, the Parliament adopted the law, according to which:
- The amount of unemployment insurance benefit for the first 100 days will be increased up to 60% of nine months average daily remuneration a person has received 3 months before getting unemployed (will enter into force on 1 August 2020).
- The amount of unemployment allowance will be increased. At the moment the daily rate which is the basis for the calculation of unemployment allowance shall be established by the state budget for a budgetary year, however the 31-fold daily rate shall not be less than 35 per cent of the minimum monthly wage rate in force on 1 July of the year preceding the budgetary year. From 1 January 2021, the daily rate shall not be less than 50 per cent.
- While registered as unemployed, a person may work temporarily for up to eight days in a calendar month, but not more than 12 calendar months in a 24-month period (will enter into force on 1 September 2020).
Currently we are analysing whether self-employed should be covered by unemployment insurance and under what conditions. Also, we are analysing whether the conditions for unemployment benefits should depend on the economic situation.
c) Research (including evaluation), completed or initiated
In 2019 Praxis Centre for Policy Studies Foundation carried out the study about Estonian unemployment insurance and unemployment allowance system.
V. OLD AGE BENEFIT
a) Changes made during the reference period
Changes to the State Pension Insurance Act
On 1 April 2020, the base amount of pension was additionally increased after indexation by 7 euros. Following indexation, the base amount of pension totals €208.5 and the value of one year of pensionable service amounts to €7.104. Additionally, the value of base amount was increased from €208.5 to €215.5 as a result of an extraordinary increase of €7.
This step was meant to reduce the risk of poverty of old-age pensioners and improve their wellbeing. The extraordinary increase in the base amount increased the pensions of all old-age pensioners as well as those receiving pensions for incapacity for work or loss of a provider. Pensioners not active in the labour force benefited most from this.
Article 27
A. The recourse is had to Article 27 (b) of the Code.
B. Starting from January 1, 2017, pensionable age in Estonia is gradually raising to attend 65 years by 2026. Pensionable age depends on year of birth.
The objective of the pension reform, which was formalized in 2018, is to prevent a reduction in pensions and to ensure the country’s financial sustainability. The most important changes are supplementing the pension formula, opening the possibility of joining the second pillar for those born in 1970-1982, linking the retirement age with life expectancy and the implementation of a flexible retirement pension.
Pension age will be linked to life expectancy from 2027 when the previous rise in pensionable age is achieved (65 years for men and women).
From 2021 onwards, people can choose the most suitable time for retirement, suspend their pension if they wish, or take half the pension.
C. Statistical information (Article 74):
a) the number of economically active insured persons as of December 31, 2019, was 639 904 (data by Estonian Health InsuranceFund);
b) the total population of Estonia as of January 1, 2020, was 1 328 976 (data by Statistics Estonia);
c) number of economically active insured persons was 48,2% of total population.
a) number of economically active insured as of December 31
|
2019 |
639 904 |
|
2018 |
632 428 |
|
2017 |
618 289 |
|
2016 |
604 781 |
|
2015 |
615 333 |
Source: Estonian Health Insurance Fund
b) total population of Estonia as of January 1
|
2020 |
1 328 976 |
|
2019 |
1 324 820 |
|
2018 |
1 319 133 |
|
2017 |
1 315 635 |
|
2016 |
1 315 944 |
Source: Statistics Estonia
c) economically active insured persons per cent of total population
|
% |
|
|
2019 |
48.2 |
|
2018 |
47.7 |
|
2017 |
46.9 |
|
2016 |
46.0 |
|
2015 |
46.8 |
b) Changes decided, planned or proposed for the following year
Changes to the Social Tax Act
Second pillar social tax suspension
Estonia will temporarily suspend the payment of employer contributions to the second pension pillar, except for employees born between 1942 and 1960. This suspension will happen from 1 July 2020 until 31 August 2021. Members will have the option of stopping their contributions as well by applying for a suspension in October 2020. The suspension of employee contributions will apply between 1 December 2020 and 31 August 2021.
In 2023-2024, the state budget will finance the missing 4% employer contributions for every month employees continue to make their 2% contributions between 1 July 2020 and 31 August 2021. This amount will be paid into second pillar pension plans. The state will also finance a return on these missing contributions. This return will correspond to the average return of second pillar pension plans between 1 July 2020 and 31 December 2022.
The special regime for crew members
From 1 July 2020 social tax is paid for a particular month in the case of a crew member to the extent of 750 euros per each month worked if the remuneration has been received from employment on a ship. In the month of the commencement or termination of the employment of a crew member, the remuneration shall be calculated in proportion to the number of days worked.
d) Rates of payment during the reference period (Art 65, p 10)
The old-age pension of a beneficiary with a pensionable period of 30 years, euro
|
The old-age pension with a pensionable period of 30 years |
Pension components |
|||
|
Base part |
National pension rate |
Value of a year |
||
|
2020 |
428,63 |
215,5148 |
221,63 |
7,104 |
|
2019 |
390,46 |
191,6496 |
205,21 |
6,627 |
|
2018 |
360,27 |
175,439 |
189,31 |
6,161 |
|
2017 |
334,91 |
161,9038 |
175,94 |
5,767 |
|
2016 |
318,72 |
153,3035 |
167,40 |
5,514 |
|
2015 |
301,61 |
144,2585 |
158,37 |
5,245 |
|
2014 |
283,83 |
134,9093 |
148,98 |
4,964 |
|
Source: Social Insurance Board |
||||
VII. FAMILY BENEFIT
a) Changes made during the reference period
The position of Minister of Population was restored as of 29 April 2019. Minister of Population is responsible for population and family policy. Minister has started drafting a population development plan, which addresses different demographic issues. One of the main goals is to reach replacement fertility by advancing the wellbeing of families with children. Family friendliness is one of the main goals of the government.
1) Changing the period for calculating parental benefit
As of 1 September 2019, the base period for calculating the amount of parental benefit was changed. Pursuant to the new procedure, the 9 full calendar months from the month of birth of the child are subtracted (average length of pregnancy irrespective of whether or not the child is full-term, premature or post-term) and the amount of parental benefit is calculated on the basis of average income earned over the course of 12 months preceding those 9 months. Average income is calculated based on the amount of social tax declared and paid for the applicant by the employer. If the father of the child applies for the parental benefit, his benefit is calculated on the basis of the same period as for the mother of the child.
Before the amendment, the period for calculating the amount of parental benefit was based on the calendar year before obtaining the right to parental benefit. Therefore, the last month of the base period could range from one month to 11 months preceding the birth of the child. The amendment has unified the base period regulation for all applicants.
2) Amendments have been made to shorten the applications processing time for some family benefits, so that families can receive payments earlier:
a. As of 7 May 2020, in case there is a difference in the amount of parental benefit and maternity benefit and the mother is eligible for a compensation, it is paid out immediately after the child is born and the parental benefit has been applied for by the mother. The compensation is paid out as a single payment. Previously the mother received the compensation with the first parental benefit payment, usually 4-5 months after the birth of the child.
b. The waiting period for maintenance allowance has been reduced from four months to one month. As of 1 July 2020 maintenance allowance during enforcement proceedings shall be paid if one month has passed from the beginning of enforcement proceedings and if within the next calendar month the alimony is not paid to the child. The maximum amount of maintenance allowance has not changed and remains up to 100 euros per calendar month per child. If the court ruling imposed a smaller alimony, then that amount is paid.
3) Calculation of parental benefit upon successive birth of children
As of 1 July 2020 the protected period of consecutive births is extended from two and a half to three years. If the next child is born within three years’ time, the amount of parental benefits for the next child will remain at least the same as it was for the previous child. Receiving taxed income in between the consecutive births is not required to qualify for the benefit. The aim of the amendment is to better support the families with children and increase the birth rate.
4) Additional parental benefit for fathers and 30 days of paternity leave
A new type of parental benefit has been introduced - an additional parental benefit for fathers. The benefit applies if the child is born on 1 July 2020 or later. The benefit is paid during paternity leave for up to 30 days. Before the amendment, the paternity leave was 10 workdays and the compensation for that time was not part of the parental benefit system. The goal of the amendment is to promote greater involvement of fathers in the raising of their children. If the child's biological father is failing to perform his obligation to raise the child and has not already exercised his right to the additional benefit for fathers, the adoptive parent, guardian or foster parent or the mother’s spouse has the right to receive the additional parental benefit for fathers.
5) The payment period for the parental benefit has been made more flexible
As of 1 July 2020, the payments of the parental benefit may, according to the parent’s request, be suspended and resumed by calendar months until the child reaches 3 years of age. The amendment applies to those who are just beginning to receive the parental benefit as well as those who have already been receiving the benefit. Suspension and continuation of parental benefit may not be granted for a period shorter than one calendar month, except for the month when parental benefit begins and ends. When resuming the payments of the parental benefit, the amount of the parental benefit will not be recalculated.
6) Child care allowance will no longer be granted as of 1 September 2019
For children born on 1 September 2019 or later child care allowance will no longer be paid. The state will gradually incorporate the funds of the child care allowance to the parental benefits system during the period of 2020–2022.
Child care allowance pursuant to the old procedure will continuously be paid to families where a child is born on 31 August 2019 at the latest. Child care allowance will be continued also for those, who were already being paid child care allowance on 31 August 2019 or who have been granted the allowance earlier. Child care allowance will be paid until the expiry of the right to the allowance or until 31 August 2024 at the latest.
7) Home support for families with many children (by KredEx)
From 2020, families with many children can apply for a larger amount of home support from government financed KredEx foundation. The grant increased from 8 000 euros to 10 000 euros per applicant. A family may be granted the home support on up to two occasions. The maximum amount of support for first-time applications is now 10 000 euros. In justified cases the maximum amount of support may be up to 18 000 euros per applicant. The maximum support in case of a second application is 5 000 euros. Households that have previously been granted home support on two or more occasions do not apply.
The goal of the support is to improve the living conditions of large families with modest means. Families with three or more children can use the support to purchase, renovate or expand their home.
Periodical benefits and their amounts as of entry into force of Family Benefits Act:
|
Type of benefit |
Amount of benefit |
|
Child allowance |
The amount of the child allowance depends on the number of children in the family: - family with one or two children eligible for the child allowance - 60 euros per child per month; - family with three or more children eligible for the child allowance - 100 euros per child per month starting from the third child. |
|
Single parent’s child allowance |
19,18 euros per month. |
|
Child care allowance |
For children born on 01.09.2019 or later child care allowance will no longer be paid. - We will grant and keep paying child care allowance pursuant to the old procedure to all families where a child is born on 31 August 2019 at the latest. - We will also keep paying child care allowance to all who are already being paid child care allowance on 31 August 2019 or to whom we have granted the allowance earlier. - We will keep paying child care allowance until the expiry of the right to the allowance or until 31 August 2024 at the latest. One parent in the family is entitled to receive child care allowance (after the end of the parental benefit payments) if the family has: - an up to 3-year-old child: 38.36 euros per month per each up to 3-year-old child. In addition child care allowance is paid for 3 to 8-year-old children if: - the family has one up to 3-year-old child, and another child between 3 and 8 – 19.18 euros also per the 3-8-year-old per month; - the family has 3 or more children eligible for the child allowance – 19.18 euros per month for each 3-8-year-old. |
|
Guardianship allowance |
The allowance of 240 euros is paid monthly for each child under guardianship. |
|
Allowance for families with many children |
For the family with three to six children - 300 euros per month. For the family with seven or more children - 400 euros per month. |
|
Allowance for multiple birth of three or more children |
1000 euros per month is paid from the birth of the children to a parent, who is raising triplets or more children of multiple birth. The right to receive this allowance lasts until the day the children turn 18 months. |
|
Parental benefit |
The parental benefit amount is calculated separately for each recipient, depending on their previous income. Average income is calculated based on the amount of social tax declared and paid for the applicant by the employer. When calculating the amount of parental benefit 9 months preceding the month of birth of the child is subtracted and the amount of benefit is calculated on the basis of income earned over the course of 12 months preceding those 9 months. The parental benefit is also paid if the parent did not earn any income taxable with the social tax. In this case, the benefit is paid in the amount of the minimum wage that applied on January 1st of the previous calendar year, which was 540 euros per month in 2019. If the parent earned income but the average monthly income was below the minimum salary rate, they will be paid the parental benefit equal to the minimum salary rate. The minimum monthly salary rate in 2020 is 584 euros per month. The maximum parental benefit amount is three times the average Estonian salary of the year before last year. In 2020 the maximum parental benefit is 3 548.10 euros. Parental benefit is a taxable income. |
Article 41
A. The recourse is had to Article 41 (b) of the Code
B. Protected persons are all permanent residents of Estonia or aliens residing in Estonia on the basis of temporary residence permits or temporary right of residence.
C. Statistical information Title II Article 74:
Title II of Article 74 is not the most suitable for getting statistical data on persons affected by the State Family Benefits Act. Therefore, in order to show the fulfilment of the requirements in Article 41 of the Code, the number of covered persons shall be deemed equal to the total number of male population of economically active age (15–64).
a) In 2019, the number of Estonian male population aged 15–64 was 424 071(Statistics Estonia);
b) In 2019, the total population of Estonia (annual average) was 1 326 898 (Statistics Estonia);
c) The number of covered persons amounted to 32 % of the total population.
a) number of Estonian male population aged 15–64 (annualaverage)
|
2019 |
424 071 |
|
2018 |
422 821 |
|
2017 |
421 669 |
|
2016 |
422 397 |
|
2015 |
423 583 |
Source: Statistics Estonia
b) total population of Estonia (annual average)
|
2019 |
1 326 898 |
|
2018 |
1 321 977 |
|
2017 |
1 317 384 |
|
2016 |
1 315 790 |
|
2015 |
1 314 608 |
Source: Statistics Estonia
c) covered persons per cent of total population
|
% |
|
|
2019 |
32.0 |
|
2018 |
32.0 |
|
2017 |
32.0 |
|
2016 |
32.1 |
|
2015 |
32.2 |
b) Changes decided, planned or proposed for the following year
1) Changing the calculation of the amount of parental benefit
During the next 2 years period, in case of unemployment, the time of unemployment will not be taken into account when calculating the amount of parental benefit. The planned amendment will ensure that parental benefit will be calculated according to the taxed income preceding unemployment and the parents will not lose out because of COVID-19. The aims are to prevent the negative impact of the pandemic on fertility and to increase the confidence and wellbeing of families with children.
2) To increase large family allowance and make the ending of the allowance more flexible
Large family allowance has been adopted from 1 July 2017. Families raising 3-6 children receive 300 EUR and families with 7 or more children 400 EUR monthly in addition to child allowance. As a result, the number of third births has increased by 23% compared to the average number of births in the previous 10-year period. The number of third births in 2018 and 2019 was highest since 1990. Therefore, the total fertility rate went up from 1,59 in 2017 to 1,67 in 2018. In 2019 the total fertility rate was 1,66. The new allowance has also significantly reduced the risk of poverty for children.
We plan to increase large family allowance to half of the average income. The aim is to increase the benefit so that in case a third child is born, the average amount of income per family member remains the same as before the birth.
We also plan for a gradual decrease in support for families with many children as children grow older. According to the plan, if a parent who has raised at least three children and has previously received large family allowance in full will continue to receive the allowance in part until the younger children are still entitled to child benefit.
3) Payment of maintenance allowance in the event of bankruptcy
Maintenance allowance is granted to children, whose parent or parents do not fulfil their maintenance obligation. Maintenance allowance can be applied for during the legal proceedings as well as the execution proceedings and we plan to add regulation for bankruptcy proceedings. The aim of the planned amendment is an equal treatment of children whose parent or parents do not fulfil the alimony obligation. Children whose parent or parents have been declared bankrupt would be able to receive maintenance allowance from the state during the proceedings.
4) We plan for making family counselling and therapy more accessible, as distress and mental health issues have increased in the COVID-19 influenced situation. If problems are not addressed timely, it can lead to more severe consequences and separation. We plan to offer 5 state financed therapy sessions to approximately 5% of families with children.
c) Research (including evaluation), completed or initiated
In 2020 we plan to analyse the efficiency and effectiveness of existing family policy measures and draft a long-term vision of pro-natalist family policy to ensure the confidence of families with children and progress toward replacement fertility.
VIII. MATERNITY BENEFIT
a) Changes made during the reference period
In recent years several changes have been made to the parental leave and benefits system. The aim of the changes has been to encourage more fathers to share care responsibilities with the mothers and also to provide more flexible possibilities for families to combine being on parental leave and participating in the labour market.
The amendments of the parental leave and benefits system were submitted by the Parliament on 17th October 2018 and the changes will come into force on 1 April 2022. The amendments to the law include renaming of the pregnancy and maternity leave as maternity leave and the introduction of changes to the terms and conditions. Compared to pregnancy and maternity leave, the period of maternity leave will be shortened from 140 to 100 days, but as a result the parents will have a longer paid parental leave period which they could share. Whereas the pregnancy and maternity leave was reimbursed as maternity benefit from the Estonian Health Insurance Fund budget, the maternity leave will be paid as mother’s parental benefit through the Social Insurance Board from the state budget.
Article 48
A. The recourse is had to Article 48 (b) of the Code.
B. No changes.
C. Updated statistical information
a) In 2019, the number of Estonian female population aged 15–64 (annual average) was 420 696 (Statistics Estonia);
b) In 2019, the total population of Estonia (annual average) was 1 326 898 (Statistics Estonia);
c) The number of covered persons amounted to 31,7% of the total population.
a) number of Estonian female population aged 15–64 (annual average)
|
2019 |
420 696 |
|
2018 |
422 716 |
|
2017 |
424 868 |
|
2016 |
428 467 |
|
2015 |
432 167 |
Source: Statistics Estonia
b) total population of Estonia (annual average)
|
2019 |
1 326 898 |
|
2018 |
1 321 977 |
|
2017 |
1 319 133 |
|
2016 |
1 315 635 |
|
2015 |
1 314 608 |
Source: Statistics Estonia
c) covered persons per cent of total population
|
% |
|
|
2019 |
31.7 |
|
2018 |
32.0 |
|
2017 |
32.2 |
|
2016 |
32.6 |
|
2015 |
32.9 |
IX. INVALIDITY BENEFIT
Work ability allowance
Work ability reform replaces incapacity for work pension with work ability allowance. The latter’s amount is not linked to a person’s previous income, nor to the employment record.
Transition provisions from the heritage system to the new one
All the incapacity for work pensioners will enter the new work ability systemby 2020. With an exception for a small category of those who are assessed as permanently incapable for work with no re-assessment term given (termless) – this category will be receiving incapacity for work pension until reaching retirement age. Nevertheless, they can join the new system on voluntary basis.
a) Changes made during the reference period
During the COVID-19 situation the periods of work ability were extended because of impossibility to visit a doctor for updating the data needed for work ability assessment in health information system. This was a temporary measure during the lockdown period.
Article 55
A. The recourse is had to Article 55 (b) of the Code.
B. All permanent residents of Estonia and aliens residing in Estonia on the basis of temporary residence permits or temporary right of residence between the age of 16 and the pensionable age.
C. Please refer to the information provided under Article 27.
b) Changes decided, planned or proposed for the following year
No changes.
c) Research (including evaluation), completed or initiated
The Work Ability Reform ex post analysis is in preparation in 2020 and planned for 2021.
d) Rates of payment during the reference period (Art 65, p 10)
Work ability allowance daily rate (as of April 1, 2020) is 14,89 euros. The effective allowance amount is:
- 57% of daily rate in case of partial work ability – 8,49 euros a day or ca 254,62 euros a month;
- 100% of daily rate in case of no work ability – 14,89 euros a day or ca 446,70 euros a month.
Similarly, to state pension’s daily rate of work ability allowance indexed on yearly basis on April 1, which presumably raises the rate each year. Unlike state pensions work ability allowance is not taxed with income tax.
X. SURVIVORS’ BENEFIT
a) Changes made during the reference period
No significant changes (persons protected, contingencies covered) during the reporting period.
b) Changes decided, planned or proposed for the following year
No changes.
d) Rates of payment during the reference period (Art 65, p 10)
|
From April 1 |
Survivor’s pension, euros |
||
|
for three family members |
for two family members |
for one family member |
|
|
2020 |
428,63 |
342.90 |
214.32 |
|
2019 |
390,46 |
312.37 |
195.23 |
|
2018 |
360,27 |
288.22 |
180.14 |
Source: Social Insurance Board
Additional information requested by the supervisory bodies of the Code and Protocol
Part X (Survivors’ benefit), Article 60(1) of the Code. Presumption of the widow/widower to be incapable of self-support. In its previous conclusions, the Committee requested the Government to indicate whether spouses who are caring for a child, who are partially disabled in excess of a prescribed degree, or who have reached the age lower than the pensionable age at which it is impossible for them to find employment on the national labour market are presumed to be incapable of self-support and, therefore, entitled to survivors’ benefits.
In its reply, the Government indicates that survivors’ benefits are applicable to spouses if they are in accordance with section 20(2) items (3), (4) and (6) of the Estonian State Pension Insurance Act:
- a non-working widow who is pregnant (from the twelfth week of pregnancy);
- a widow or widower who has been established to have partial or no work ability pursuant to the Work Ability Allowance Act or who is of pensionable age and whose marriage to the deceased had a duration of at least one year; or
- a parent or guardian of a deceased’s child who is not employed and is raising the deceased’s child who is under 3 years of age in his or her family.
The Committee recalls that Article 60(1) of the Code stipulates that “in the case of a widow, the right to benefit may be made conditional on her being presumed, in accordance with national law or regulations, to be incapable of self-support”. While this provision offers a Contracting Parties some leeway in defining the eligibility conditions for a survivors’ benefit, the Committee notes nevertheless that the conditions laid down in section 20(2) items (3), (4) and (6) of the Estonian State Pension Insurance Act are rather restrictive in comparison to international social security law, comprised of the Code, ILO social security Conventions and comparative country practice.
The Committee points out that in view of the difficulties of finding a job at a higher age, the Contracting Parties to the Code usually provide that survivors’ benefits are payable already some years before reaching the pensionable age, and that not only spouses raising a child up to age three are eligible for them, but that they may receive the benefit for the whole period during which the child is considered to be dependent in accordance with national law. The Committee therefore requests the Government to consider taking measures to ensure that the spouses of deceased insured persons who find themselves in one of these situations be entitled to survivors’ benefits to give full effect to Article 60(1) of the Code.
In the previous report we indicated the conditions of applicability for survivor’s benefit to spouses.[1] However, for the purpose of clarity it is useful to bring out the full list of persons with the right to survivor’s pension in Estonia:
According to § 20 section 2 of the State Pension Insurance Act, family members who have the right to receive a survivor’s pension are:
1) a provider’s child, brother, sister or grandchild who is under 18 years of age (or who is under 24 years of age and is a student enrolled in daytime study or, for medical reasons, in another form of study at an upper secondary school or vocational educational institution or a student enrolled in full-time study at a university or institution of applied higher education), or who is older if he or she was established to have partial or no work ability pursuant to the Work Ability Allowance Act before he or she attained 18 years of age (or in the case of a student enrolled in daytime study or, for medical reasons, in another form of study, or in full-time study, before he or she attained 24 years of age). A brother, sister or grandchild has the right to receive a pension if he or she does not have parents with capacity for work;
2) a provider’s parent who is of pensionable age or who has been established to have partial or no work ability pursuant to the Work Ability Allowance Act;
3) a provider’s non-working widow who is pregnant (from the twelfth week of pregnancy);
4) a provider’s widow or widower who has been established to have partial or no work ability pursuant to the Work Ability Allowance Act or who is of pensionable age and whose marriage to the provider had a duration of at least one year;
5) a provider’s divorced spouse who attained pensionable age or was established to have partial or no work ability pursuant to the Work Ability Allowance Act before the divorce or within three years after the divorce and whose marriage to the provider had a duration of at least twenty-five years;
6) a parent or guardian of a provider’s child who is not employed and is raising the provider’s child who is under 3 years of age in his or her family.
Also, according to § 20 section 3, the following also have the right to receive a survivor's pension:
1) a child whose parent's spouse or foster parent is dead and who is not maintained by his or her parent;
2) a person who has raised and maintained a child as a parent's spouse or as a foster parent for at least eight years.
We consider it important to indicate, as noted above, that a person can also apply for survivor’s benefit if they are the deceased family member’s child, brother, sister or grandchild under 18 years of age (or under 24 years of age if they are enrolled in daytime study at an upper secondary school or vocational educational institution or in full-time study at an institution of applied higher education or university); parent whose work ability is reduced or who is of pensionable age. Therefore, the child of deceased insured person can receive survivor’s benefit during the whole time when they are dependent (until they are 18 years old or 24 years old) and this can help to maintain their standard of living.
In Estonia one of the two general objectives in our “Welfare development plan 2016-2023” is to have a high employment rate and high-quality working life of men and women. Employment gives people an opportunity for self-realisation and financial security and is, therefore, one of the main prerequisites for socio-economic development, and a basis for a high-quality life. Due to the small and declining number of Estonian human resources, it is essential that as many residents as possible are able and can contribute to social and economic life. We also consider it important to support the financial security of men and women equally
We have no grounds to consider all widows or widowers who are raising a child older than 3 years of age, to be incapable of self-support. We have very good childcare coverage for children that are over 3 years old, to support the parents’ participation in employment while they are raising children. Also, the participation in employment is considered a social norm by people, for example the employment rate of men and women with children who are older than 3 years is high and most men and women are in full-time employment.
Some statistics about employment rate of parents with small children and the use of childcare possibilities:
- While in 2018 the employment gap among women and men in the age group of 20-49 with at least one child aged less than 3 years was 63 percentage points (W – 32%, M – 95%), among women and men without such young children, the employment gap was 3 percentage points (W – 84%, M – 87%). The labour market participation stabilizes among women and men and is high for both after the right to parental leave ends - the employment rate of women and men aged 20–49 by presence of 3–6-years old child was already 83,5% and 95,6% accordingly.
- In 2019, 32.8% of children aged less than 3 years (compared to 27.8% in 2018) and 93.7% of children aged 3-6 (compared to 92% in 2018) participated in formal childcare (Social Survey 2018 and 2019, Statistics Estonia). National Early Childhood Education Register shows that in 2018/19, participation rates were 30.7% for 1-year-olds, 78% for 2-year-olds and 89% for 3-year-olds, whereas these rates do not include children in the care of childminders (around 7% of under 3-year-olds). The average number of hours that Estonian children spend in ECEC is among the highest in Europe.
If with the child receiving survivor’s benefit and the parent’s income is not enough to sustain the family of the deceased person or if the parent cannot find a job then there are other measures to support their subsistence.
The people whose work ability is reduced or who could be incapable of self-support are supported with workability allowance and labour market services, as well as social services.
When a person has been off the labour market for a long time, then there are supportive labour market measures. The labour market services of long-term unemployed persons are provided according to the Labour Market Services and Benefits Act. The Estonian Unemployment Insurance Fund takes an individual approach when providing services to unemployed persons. Therefore, there are generally no specific measures for long-term unemployed persons. The only specific measure for the long-term unemployed is salary subsidy that is paid to the employers of persons that have been long-term unemployed.
In addition, it is worth noting, that the employment level of older people in Estonia is among the highest in Europe. According to Statistics Estonia, during recent years, the employment rate has grown in the age group of 50-74 (57.9% in 2018 and 59.4% in 2019). The growing employment rate of the elderly is further supported by the gradual raising of retirement age, improving health indicators and changing attitudes towards employment in retirement age. Compared to other EU countries, Estonian older people are more active in the labour market and work longer. The employment rate of the elderly (50-74) in Estonia is the highest in Europe (according to Eurostat 59.6% in Estonia; 48% in the EU-28). This is primarily due to the higher employment rate of Estonian old-age pensioners. The employment rate of people aged 65 or over is much higher than in other EU countries (according to Eurostat 14.2% in Estonia; 6.4% in the EU-28). Therefore, there does not seem to be major difficulties for older people to find employment in Estonia.
People in need can also apply for the subsistence benefit which is a general minimum income system in Estonia which guarantees a subsistence level and also covers dwelling costs (in accordance with socially justified norms and price limits).
XI. FINANCING
Article 65
Sickness benefit is financed according to the Health Insurance Act and the Social Tax Act. The funding is done through the national sickness fund who receives its sources mainly form payroll tax.
The sickness benefit provides compensation for temporary health-related incapacity for work. Compensation for temporary incapacity for work is paid for temporary illness only to those in employment, based on earnings in the previous year.
Sickness benefits:
· No benefit is paid during the first three days of sickness or injury.
· 70% of the previous year’s income eligible for the social tax.
· The employer pays this from the fourth to eight day and the sickness fund pays from the ninth day after temporary incapacity for work.
· Hospitalization and outpatient care up to 182 days (240 for TB) per year.
· 100%: occupational illness or accidents at work (up to 182 days), the sickness fund pays from the second day after temporary incapacity for work.
Maternity benefit:
· 100%: pregnancy and maternity leave (up to 140 days), the sickness fund pays from the first day after leave.
Adoption allowance:
· 100%: adoption leave (70 days if child is under 10 years), the sickness fund pays from the first day after leave.
Care allowances:
· 80%: nursing a child under 12 years of age up to 14 days, the sickness fund pays from the first day after leave.
· 80%: caring for a disabled child under 16 years or child under 3 years if the carer is ill or receiving obstetric care up to 10 days, the sickness fund pays from the first day after leave.
Unemployment benefit is financed according to the Unemployment Insurance Act and the Labour Market Services and Benefits Act.
a) The maximum amount of unemployment insurance benefit in 2020 is 1656,33 euros a month. The minimum amount of unemployment insurance benefit for 31 days is 279 euros (minimum daily rate is 9 euros).
The basis of the maximum amount of unemployment insurance benefit is three times the average remuneration per calendar day in Estonia, which is 35,62 euros this year. The average remuneration per calendarday is recalculated every year by the Unemployment Insurance Fund on the basis of unemployment insurance premiums paid in the preceding year.
The amount of unemployment insurance benefit is:
- for the first 100 days - 50% of nine months average daily remuneration a person has received 3 months before getting unemployed;
- for the subsequent days - 40% of nine months average daily remuneration a person has received 3 months before getting unemployed.
Also unemployment allowance daily rate has changed on January 1, 2020, and is 6,10 euros a day. In 2020, the unemployment allowance amount for 31 days is 189,10 euros.
b)-c) See IV b)-c)
Family benefit is financed according to the Family Benefits Act.
Maternity benefit is financed according to the Health Insurance Act.
A pregnant woman has the right to receive maternity benefit on the basis of a certificate for maternity leave for 140 calendar days if her pregnancy and maternity leave commences at least 30 calendar days before the estimated date of delivery as determined by a doctor or midwife. The number of the days by which the pregnancy and maternity leave of the woman commences after the term provided for in this subsection will be deducted from the period for which the woman has the right to receive maternity benefit.
The right to receive the maternity benefit arises as of the first day of release from the performance of duties as specified in the certificate of incapacity for work.
The health insurance fund will pay the benefit for temporary incapacity for work to an insured person per calendar day as a percentage of their average income per calendar day 100 per cent in the event of pregnancy and maternity leave.
Article 66
Workability allowance is financed according to the Work Ability Allowance Act and the Social Tax Act.
Old age pension is financed according to the State Pension Insurance Act and the Social Tax Act.
Survivors’ pension is financed according to the State Pension Insurance Act and the Social Tax Act.
Additional information requested by the supervisory bodies of the Code and Protocol
III. concerning Part XI (Standards to be complied with by periodical payments), Articles 65 and 66 of the Code, the Committee of Ministers notes that old-age and survivors’ pensions consist of three components, namely a basic flat-rate component, a length-of-service component and an insurance component. While the first two components are determined at a flat rate, the insurance component is determined by an annual coefficient which is calculated by dividing the insured’s contributions for a calendar year by the national average contribution amount for that year. As the amount of the insurance component depends on amount of contributions paid on the basis of wage, it is not provided at a flat rate, but earnings-related. The Committee of Ministers notes that the calculations in the Government’s report are made in accordance with Article 66 of the Code which, however, can only be used for flat-rate benefits which are not related to previous earnings;
The committee decides to invite the Government of Estonia:
II. concerning Part XI (Standards to be complied with by periodical payments), Articles 65 and 66 of the Code, to supply in its next report additional calculations made in accordance with Article 65 of the Code. When doing so, the calculation of the additional insurance component can be done for a standard beneficiary who has earned 125 per cent of the average wage for a period of 30 years.
|
Calculation of survivor’s benefit and old-age benefit |
In 2019, the old-age pension of a beneficiary with a pensionable period of 30 years was 390,46 euros and survivor’s benefit was 205,21 euros. In total 595,67 euros. |
|
Calculation in previous report (2018-2019) in accordance with Article 66 |
The total of these two pensions (595,67 euros) must be at least 40% of the total wage of an ordinary adult male labourer (911,84 euros). Calculation: (390,46+205,21)/911,84*100 = 65,3% |
|
New calculation for the same period in accordance with Article 65 |
The total of these two pensions (595,67 euros) must be at least 40% of the total wage of a skilled male labourer (1327,98 euros). New calculation: (390,46+205,21)/1327,98*100 = 44,9% The wage calculation of a skilled male labourer is based on pension insurance data of individually registered social tax. |
[1] Survivor’s benefit is applicable to spouses if they are: a provider’s non-working widow who is pregnant (from the twelfth week of pregnancy); a provider’s widow or widower who has been established to have partial or no work ability pursuant to the Work Ability Allowance Act or who is of pensionable age and whose marriage to the provider had a duration of at least one year; a provider’s divorced spouse who attained pensionable age or was established to have partial or no work ability pursuant to the Work Ability Allowance Act before the divorce or within three years after the divorce and whose marriage to the provider had a duration of at least twenty-five years; a parent or guardian of a provider’s child who is not employed and is raising the provider’s child who is under 3 years of age in his or her family.