OECD report highlights weak points of Swiss social assistance

Switzerland’s welfare payments are on average very generous but have a tendency to stifle personal initiative and tend to slow down a return to the job market, says a newly released report.

Switzerland’s welfare payments are on average very generous but have a tendency to stifle personal initiative and tend to slow down a return to the job market, says a newly released report.

The study by the Organisation for Economic Cooperation and Development put the spotlight on four cantons – Zurich, Vaud, Ticino and Graubünden – to find out how effective welfare payments are in fighting poverty and a return to the labour market.

Welfare payments apply after unemployment benefits have run out and the person officially drops out of the category of the registered unemployed. The benefit payment period normally does not exceed 520 days and includes regulations that the unemployed must keep applying for jobs.

The level of Swiss welfare payments is decided on a case-by-case basis but is generally meant to cover basic living costs and prevent people from becoming social drop-outs.

The OECD report says that, not least because of this definition, Swiss welfare payments are relatively high when compared to other nations.

The OECD says that the payments tend to dampen people’s efforts to keep looking for a job – a situation aggravated by the fact that accepting a low-paying job is already enough for the newly-employed to be kicked out of the welfare recipient programme.

The OECD also says that employment offices should become more efficient and take a more active role in liasing with welfare recipients wanting to return to the labour market.

The Swiss authorities say they mostly agree with the OECD’s assessment. One area that is likely to come under scrutiny soon is that more welfare recipients may be pushed into low-paying jobs with the idea of giving people some new job experiences.

That strategy has in many ways been dropped in Switzerland since the authorities fear it might lead employers to deliberately keep down wages and foster unfair competition in certain industry sectors.

From staff and wire reports.