Index - Opinion - Raising family allowances?  It's time!

A few words about the family allowance

The family allowance is one of the oldest cash benefits in Hungary. Contributions to the cost of raising children have existed since 1912. With the exception of a short period, the benefit did not depend on the family’s income situation; The amount of family allowance increases with the number of children, takes into account family situations such as single parenthood, and provides some compensation in the event of a disability or long-term illness affecting the child. The most important thing about the family allowance is that its amount has not changed since 2008, it has lost half its value due to inflation. If I look at the ratio to gross real earnings or just the minimum wage, the situation is even worse.

The amount of the family allowance is also an important issue because, in addition to the GYES, it is one of the cash benefits that is generally available to the poorest sections of society,

while in GYED, the family tax credit is in most cases not or only partially available, but sometimes they do not receive maternity benefit. The current amount of the family allowance is HUF 12,200, the single parent can receive HUF 25,900 for a permanent child, it can be seen that these are not terribly large amounts, in 2022 the Hungarian budget will spend HUF 307.5 billion for this purpose, which is 1.7 affects millions of children and young people.

Cash benefits as a disincentive

I do not want to react in detail to Shagács’ political ideas (any temptation), because let us treat them as subjective, non-expert manifestations, which obviously stem from a political-ideological attitude. On the other hand, let’s look at the claims he makes or suggests about raising the family allowance.

According to Forgács, a person who thinks responsibly and knows the issue of social inclusion and Roma communities cannot support the increase of the family allowance in cash. It follows from this, in principle, that he sees the family allowance itself as a kind of free money, as a counter-incentive to performance, as an obstacle to catching up. However, no data suggest this, but it is not supported by practice. Let’s keep in mind that in 2022, the net amount of the minimum wage of HUF 133,000 alone cannot be produced from GYES and family allowances, not least because the amount cannot even be approximated when counted together with the family tax credit.

With a minimum of rationality, it can be seen that there is no scenario where social transfers are competitive with labor income,

even if we doubled the family allowance. Moreover, with the increase in labor income, the family allowance is not lost either, so even in this form it does not work against it.

The anti-work effect of cash benefits is a classic neoliberal argument, in the spirit of which the current government has done everything in recent years to push them into the background, or at least to inflate them, suppressing the realization of a “work-based society”. Meanwhile, in practice, this item is not substantiated by data, with low social transfers only increasing vulnerability. It should also be noted that the home image of people living in deep poverty is largely a lie, they are simply forced into livelihood strategies (public work, employment in the gray and black economy) in which all financial benefits received from the state are appreciated.

According to Forgács, the problem is that the current family allowance is not spent directly on children by parents in Hungary today – neither the gypsies nor the majority. According to the Family Support Act (Act LXXXIV of 1998), the state provides a monthly education allowance or schooling allowance for the costs of raising a child – this is the family allowance. With regard to the use of the supplement, it was never expected to be itemized with the cost to the child. Basically, this is a rather bad-faith approach, assuming that families are unable to functionally use a grant regardless of their social status – while the elementary costs of raising a child are many times the amount of the grant. As Forgács writes, the opposition cannot guarantee that the increased family allowance will be paid to the children – and no one needs to be guaranteed this. There is no guarantee of this in the case of the family tax credit either, but the government does not carry out targeted inspections to regulate families.

Do we give the family allowance in this nature?

This debate is quite old, and one of the arguments for misuse is the use of vouchers. However, there are plenty of counter-arguments. One such argument is that a very large proportion of people living in deep poverty and poverty live in small settlements, segregates, where these vouchers are difficult to use due to lack of services: most of these vouchers are worth nothing in local convenience stores, the actual acceptance points are much further away than in would be realistically accessible to the family. In addition, the phenomena that make the lives of the poor live in the same way, e.g. usury. In this case, for example, the family is forced to cash in their vouchers at a lower price, and again only the family loses. Even food packages are not a guarantee – especially if the state buys them significantly overpriced (see the case of RSZTOP packages).

It is questionable whether the bad consumption habits that characterize people living in deep poverty in a higher proportion than the social average (consumption of unhealthy foods, smoking, alcohol consumption, etc.) can be prevented by trying to redirect financial resources. From a social work perspective, the answer is NO, it is not in itself a primary and not a sufficient tool. Sociological commonplace follows:

in deep poverty, survival strategies are emerging that differ significantly from the social norm and have been in place for decades and have been passed down from generation to generation.

It is very important that these survival strategies are maintained by the majority social environment by creating conditions that make eruption extremely difficult. It is also a much-mentioned sociological fact that after the change of regime, the opportunities for social mobility narrowed and e.g. one of the main elements of this is the reduction of the social mobility effect of the education system. The approach to “explaining” this was that although the opportunity was given, those living in deep poverty were unworthy, irresponsible, got to where they were by their own fault, and could not break out of their own fault. This underpins the state’s attitude that those living in deep poverty should not be helped, but “educated, led on a good path.” That’s why forcing benefits in kind comes to the fore, which essentially signals the marginalization of families: the message is that “then the state will decide what you can spend the money on because you’re not fit and able to do it”.

There are some forms of in-kind support that can really work well in that form, e.g. free school meals for children. The operation of the free holiday meal is not without its problems, but the balance is tilted in a positive direction. It would be good to support public utilities in kind, but there is no general care for this and it is rare for settlements to spend on it on their own, especially if they are living in deep poverty or Roma. But if every member of society is entitled to universal financial support, then those living in deep poverty should also be entitled to it.

Hygienic poverty

Let’s talk a little bit about menstrual poverty and hygiene issues then. In a significant part of the families living in deep poverty, the hygiene problems start there, in the segregates, in small settlements there are no or severely deficient public utilities. There is still electricity, but there is hardly any running water connection or sewerage. It is quite clear that

IF YOU NEED TO DRINK WATER IN A ROOM OR BOTTOM GAS IN A ROOM OR A BOTTOM OF GAS IN A ROOM WITH A HUNDRED KETTLE, THE WATER SHOULD BE HIGH IN THE BATH.

Shavings thinks that well-being is just a matter of want and if we distribute toothpaste, washing powder, diapers and soap, it will solve everything. Well, he won’t.

I myself have been involved in a program where we provide hygiene products in a segregated manner to families. At the time of the coronavirus epidemic, we distributed hundreds of hand sanitizers, put together hygiene packs for boys and girls – but that wasn’t a replacement for the family, they were given extra help. And if it’s childbearing: informative lectures, classes, gynecological care and free contraception can be organized with the help of nurses – but again not just by losing their financial resources, but by opening up roads and areas that have been closed so far.

Why increase family allowance?

As I mentioned, the family allowance is one of the benefits that has remained unchanged and significantly devalued for a decade and a half. This devaluation makes life most difficult for people in financial difficulties, for whom other means-tested benefits are in most cases not available or are only partially available. This is why the phenomenon called “perverse redistribution” is created, according to which the real beneficiaries of the redistribution of social incomes are not the catching up social strata (which is expected in a socially sensitive state) but those living in good financial status. Let’s think about the fact that after 3 children there is a monthly family allowance of 48 thousand forints (this is almost only a symbolic help in terms of the costs of raising children) from a family tax credit of 99 thousand forints. forint. The tax base of HUF 99,000 is HUF 660,000 – this is not the income of a Roma household living in deep poverty.

Raising the family allowance would compensate for this marked imbalance – the state would support those who are more in need, not those who are less.

Even if the allowance were doubled, it would still be essentially back to its value a decade and a half ago, no more.

A balanced, systemic harmonization of higher family allowances and family tax benefits could maintain the incentive effect, although it should be added that the income of Hungarian citizens is fundamentally unrelated to their motivation to work – (but do not open this debate now).

Let us not forget that the family allowance also compensates for certain social disadvantages, so the increase would have a very positive effect on single-parent families or even families with a chronically ill and disabled child, and even on people with an adult disability, whose care is also provided by the family. allowance is established.

István Forgács’s writing is based on strongly stereotypical approaches, and the image of a state that moves from irresponsibility to a responsible life, nurturing and loving rigor at the same time, is completely flawed, according to our available knowledge of the social sciences. This is not some left-wing, liberal bias, but the practical knowledge of many research sociologists and many thousands of social workers working in the field. It is difficult to make a substantive argument against raising the family allowance, this is a serious debt of the Hungarian state, which it is time to repay.

The author is a social worker

Opinions do not necessarily reflect the views of the Index Editorial Board.

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Stefan Wermuth / Bloomberg / Getty Images)

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