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POVERTY

Five percent of Swedes on sickness benefits

Nearly one in ten Swedes in their forties is currently receiving some type of benefit due to illness or disability, according to a new report.

Five percent of Swedes on sickness benefits

New figures from Sweden’s Social Insurance Agency (Försäkringskassan) show that the number of Swedes between 40- and 49-years-old receiving either sickness compensation (sjukersättning) has nearly doubled since 1991, the Dagens Nyheter (DN) newspaper reports.

At the end of 2008, around 530,000 people, more than 5 percent people of Sweden’s entire population, were receiving one of the two benefits — sickness compensation or activity compensation (aktivitetsersättning) — designed to compensate people who can no longer work full time due to illness or injury.

Of that figure, 150,000 were receiving only partial benefits.

Activity compensation is available to people between 19- and 29-years old and is intended to “support young people who cannot work due to illness or some other disability”, according to the agency.

Sickness compensation, on the other hand, is available to workers aged 30 and above who have had their ability to work permanently reduced by at least a quarter due to illness or disability.

Sickness compensation can be partial, permanent, or time-limited.

In drawing up the report, Försäkringskassan analyzed what led people to start accepting benefits and how their economic situation has changed from 1991 to 2006.

The figures haven’t changed appreciably since 2006, said Ulrik Lidwall, an analyst with the agency, told the newspaper.

He is concerned, however, that Swedes are starting to take sickness compensation at increasingly younger ages and that the number of households with children included among those who rely on benefits payments to survive has more than tripled since 1991, from 8,000 to 27,000.

The investigation also revealed that one in three single parents with sickness compensation has a low standard of living, compared with less than one in ten from the early 1990s.

“It’s really tragic because we’re talking about people who have a long time left before they reach retirement,” Lidwall told DN.

“You have to be careful not to generalize, but the economic situation for many people with sickness compensation increases the risk that many children will be deprived of a good start in life.”

In addition, the value of sickness and activity compensation benefits are only guaranteed to increase along with general price rises, meaning the purchasing power of benefits recipients is successively eroded in comparison to workers who see their wages increase faster than the pace of inflation.

“An early entry into sickness and activity compensation brings with it a much greater risk for a life of relative poverty. In the long run, it can also lead to a significantly lower standard of living as a pensioner,” said Lidwall in a statement.

Sweden’s social insurance minister Cristina Husmark Pehrsson agrees.

“There ought to be a law prohibiting young people who have had activity compensation from automatically receiving sickness compensation when they turn 30. It creates a risk for a permanent poverty trap,” she told the TT news agency.

In September, the government announced the allocation of 17 billion kronor ($2.36 billion) in the autumn budget for initiatives to prepare the long-term sick for a return to the workplace.

Earlier that month, the Social Insurance Agency released figures showing that 4,400 Swedes lost their right to sickness benefits in the first half of 2009 as the agency tightened its regulations.

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BENEFITS

Parents told to pay back millions to Swedish state

Swedish parents who stay at home with sick children get paid at least 80 percent of their salary. But after a crackdown by the Social Insurance Agency (Försäkringskassan), hundreds of Swedish mums and dads have been told to pay back a record 14.8 million kronor ($1.7m) to the state.

Parents told to pay back millions to Swedish state
Swedish parents have been told to pay back millions to the state. Photo: Lena Granefelt/imagebank.sweden.se

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733 parents in total were forced to repay 14.8 million kronor in erroneous payouts in 2014, compared to the year before when 472 parents paid back 5.8 million.

Insurance controller Daniel Lundmark told news wire TT on Tuesday that the sharp rise is due to the Swedish Social Insurance Agency stepping up its work on investigating suspected benefit crimes.

“We have some criteria that flag up some cases. Exactly what those criteria look like, we won't communicate. It could also be that you have been involved in investigations before,” said Lundmark.

One parent was told to pay back 1.1 million kronor, an unusually high figure. The second highest last year was less than half and the average was 6,300 kronor per parent.

Sweden's generous welfare politics include paying out at least 80 percent of the salary to parents who stay at home to look after their children if they are sick. It is called 'VAB', which stands for 'Vård av barn' (Care of Children), and is very popular with Swedish mums and dads.

Last year parents claimed VAB payments for 5.9 million working days, and in February this year, parents stayed at home with their children for 680,224 days in total – a new record.

The Social Insurance Agency estimates that about a third of the cases being forced to repay the cash in 2014 intentionally tried to cheat the system and will be reported to the police. Usually, the mums and dads have claimed 'VAB', while still working and receiving their normal salary.

In the past few years, around 20-38 percent of reported benefit crimes have resulted in a conviction.

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