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Documentdatum	16-12-2016
Publicatiedatum	17-12-2016
Kenmerk	15642/16 ADD 6
Van	Secretary-General of the European Commission, signed by Mr Jordi AYET PUIGARNAU, Director
Externe link	origineel bericht
Originele document in PDF

2. Tekst

Council of the European Union

Brussels, 16 December 2016 (OR. fr)

15642/16

Interinstitutional File: ADD 6

2016/0397 (COD) i

SOC 812 EMPL 549 CODEC 1910

COVER NOTE

From: Secretary-General of the European Commission,

signed by Mr Jordi AYET PUIGARNAU, Director

date of receipt: 15 December 2016

To: Mr Jeppe TRANHOLM-MIKKELSEN, Secretary-General of the Council of

the European Union

No. Cion doc.: SWD(2016) 460 final PART 5/6

Subject: COMMISSION STAFF WORKING DOCUMENT IMPACT ASSESSMENT Initiative to partially revise Regulation (EC) No 883/2004 i of the European

Parliament and of the Council on the coordination of social security

systems and its implementing Regulation (EC) No 987/2009 i

Accompanying the document Proposal for a Regulation of the European

Parliament and of the Council amending Regulation (EC) No 883/2004 i on the coordination of social security systems and regulation (EC) No

987/2009 laying down the procedure for implementing Regulation (EC) No

883/2004 (text with relevance for the EEA and Switzerland)

Delegations will find attached document SWD(2016) 460 final PART 5/6.

Encl.: SWD(2016) 460 final PART 5/6

EUROPEAN

COMMISSION

Strasbourg, 13.12.2016

SWD(2016) 460 final

PART 5/6

COMMISSION STAFF WORKING DOCUMENT

IMPACT ASSESSMENT

Initiative to partially revise Regulation (EC) No 883/2004 i of the European Parliament

and of the Council on the coordination of social security systems and its implementing

Regulation (EC) No 987/2009 i

Accompanying the document

Proposal for a Regulation of the European Parliament and of the Council

amending Regulation (EC) No 883/2004 i on the coordination of social security systems

and regulation (EC) No 987/2009 i laying down the procedure for implementing

Regulation (EC) No 883/2004 i

(text with relevance for the EEA and Switzerland)

{COM(2016) 815 final i}

{SWD(2016) 461 final}

T ABLE OF C ONTENTS

ANNEX XVI: BRODOLINI REPORT ADMINISTRATIVE COSTS FAMILY BENEFITS ..................................................................... 3

ANNEX XVII: BRODOLINI REPORT ADMINISTRATIVE COSTS UNEMPLOYMENT BENEFITS .............................................. 96

ANNEX XVIII: BRODOLINI REPORT SECONDARY EFFECTS FAMILY BENEFITS .................................................................... 186

ANNEX XIX: BRODOLINI REPORT SECONDARY EFFECTS UNEMPLOYMENT BENEFITS .................................................... 240

ANNEX XX: TECHNICAL PROVISIONS TO BE INCLUDED WITHIN THE REVISION WHICH ARE NOT SUBJECT TO IMPACT ASSESSMENT ) ............................................................................................................................................................................... 309

ANNEX XVI: Brodolini Report Administrative Costs family benefits

Task 1: Administrative costs of handling exports of family

benefits

Study to analyse and assess the impacts of policy

options for a possible EU initiative in the area of

coordination of social security schemes, in particular

with regard to the revision of the current EU provisions

on the export of family benefits

Tender prepared under the lead of Fondazione Giacomo Brodolini on behalf of the consortium, under the Framework Contract: “Provision of services related to evaluation, evaluative studies, analysis and research work, including support for impact assessment activities” YT/2013/119 – Lot 2

The following national experts have contributed to the work of the authors: Tanja Klenk (Germany), Andrew Britt (Netherlands), Beata Samoraj-Charitonow (Poland), Magda Filip (Romania), Sally-Anne Barnes (UK)

EUROPEAN COMMISSION

Directorate-General for Employment, Social Affairs and Inclusion

Directorate B — Employment and Social Legislation, Social Dialogue

Unit B.4 — Free Movement of Workers and Coordination of Social Security Schemes

European Commission

EUROPEAN COMMISSION

Task 1: Administrative costs of handling exports of family

benefits

Study to analyse and assess the impacts of policy

options for a possible EU initiative in the area of

coordination of social security schemes, in particular

with regard to the revision of the current EU provisions

on the export of family benefits

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Luxembourg: Publications Office of the European Union, 2015

doi: [number]

Table of Contents

EXECUTIVE SUMMARY ....................................................................................... 1

1.

INTRODUCTION ........................................................................................
9

1.1. Background and purpose................................................................... 10

1.2. Methodology ................................................................................... 11

1.3. Case study Member States ................................................................ 13

2.

CURRENT ADMINISTRATIVE COSTS AND BURDEN ......................................... 13

2.1. National administrations ...................................................................

2.2. Mobile EU-citizens and their families ................................................... 19

3.

CHANGE IN ADMINISTRATIVE COSTS AND BURDEN FROM REVISED 19

EU PROVISIONS ....................................................................................... 27

3.1. National administrations ................................................................... 28

3.2. Mobile EU-citizens and their families ................................................... 31

4.

CONCLUSIONS ......................................................................................... 32

ANNEX A – LITERATURE .................................................................................... 50

ANNEX B – INTERVIEW GUIDE ........................................................................... 64

ANNEX C – CASE STUDY FOR GERMANY .............................................................. 70

ANNEX D – CASE STUDY FOR DENMARK .............................................................. 85

ANNEX E – CASE STUDY FOR NETHERLANDS .......................................................

ANNEX F – CASE STUDY FOR POLAND .................................................................

ANNEX G – CASE STUDY FOR ROMANIA ..............................................................

ANNEX H – CASE STUDY FOR UK ........................................................................

Executive Summary

Regulation (EC) No 883/2004 i of the European Parliament and of the Council of 29 April 2004 on the coordination of social security systems specifies in Article 67 that a person is entitled to family benefits, also where his/her family members reside in another Member State. Currently, the entitlement is determined by the legislation of that person's Member State – henceforth called the Member State of primary competence. Family benefits are intended to contribute to families' expenses, which both depend on the number and the age of the children and on the costs of living. However, in a case of export of family benefits, the family benefit amount depends on the costs of living in the Member State of primary competence rather than that of the Member State of residence of the child –

henceforth called the Member State of secondary competence 1 . For such cases the

amount of family benefits paid can be higher or lower than could be argued by the local circumstances where the family resides.

Revisions to the current rules are therefore being considered to address inequalities that may result from differences in the costs of living in the Member States of primary competence in relation to those of the Member States of secondary competence. Such amendments aim to ensure that family benefits contribute equally to family expenses for all families in a given Member State, and to ensure an even distribution of the financial burden between Member States. However, such revisions to the rules may also have implications for the administrative costs and burden for the national administrations handling exports of family benefits as well as for the EU-citizens themselves and their families.

On this background, the present study looks into the following three possible revisions to Regulation (EC) No 883/2004 i:

• Option 1a: Adjustment of the amount of exported family benefits to the living standard in the Member State of secondary competence (residence of the child) – i.e. adjustment upwards or downwards compared to current situation.

• Option 1b: Adjustment of the amount of exported family benefits to the living standard in the Member State of secondary competence – limited to the amount provided by the Member State of primary competence.

• Option 3 2 : Change in the current order of priority: (1) Member State of residence of the child [secondary competence], (2) Member State of work [primary

competence], and (3) Member State of pension [primary competence]. This means that the Member State of residence of the child has primary responsibility to pay the full amount of family benefits to which the entitlement exists under its national rules. The Member State of work (or pension) will top up this amount if the level of family benefits would be higher there. The family will thus receive the same amount of family benefits as before, but the allocation of the costs between the Member State of work (or pension) and the Member State of residence will differ from the current situation.

1 Not that the Member State of residence of the child is not always the state of secondary competence. For example, where both parents are economically active it will be the Member State of primary competence (Art 68(1)(b)(i)).

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There is, however, no official information available on the costs of the different administrative tasks carried out by the national administrations in the Member States when handling a case of export of family benefits. Therefore, the study has obtained this information from its primary sources via interviews with national administrations. It was not feasible within the scope of Task 1 to gather such information for all 28 EU Member States. Hence, the results are based on analyses for six case study Member States: Germany, Denmark, Netherlands, Poland, Romania, and the UK.

Change in administrative costs and burden for national administrations of primary competence

A first observation, when assessing the administrative costs and burden for the national administrations in the Member States acting as primary competence, is that most of these national administrations – at least in the six case study Member States – handle a significant number of cases annually. Germany experiences most cases with 62,587 (in 2013), followed by the UK (20,271) and the Netherlands (20,271). However, in comparison with the sizes of the national labour market, the amount of cases do compare in between the case study Member States – ranging from 0.56 cases per 1000 employed in Poland to 2.42 cases per 1000 employed in the Netherlands. Hence, from the outset it could be assumed that there within many national administrations is good experience with handling export of family benefit cases and there might be focus on the costs of doing so. In any case, the current total administrative costs are considered to be notable in an overall context.

Currently, the national administrations in the case study Member States use as shown in Table 0-1 on average around 2 man-hours per case, much of which is used for determining in which Member State the applicant and his/her family reside and in this context check whether the applicant is employed, unemployed, a posted worker or a civil servant. Relatively many resources are also spent on calculating the benefits that the given applicant is entitled to according to the given national legislation. This involves contacting the Member State of residence of the applicant's family to investigate the applicant's entitlement to family benefits in this Member State – i.e. to check for overlapping benefits, and it involves setting the payment of family benefits in motion. The UK and Denmark spend most resources per case, while the other case study Member States are at a lower but similar level.

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Table 0-1 National administrations handling exports of family benefits as primary competence, man-hours per average case

Administrative tasks DE DK NL PL RO UK (2) Av.

Standard administrative tasks

Determination of prim. competence 0.50 1.00 0.57 0.44 1.00 2.00 0.70

Calculation of benefit 0.50 1.83 0.75 0.47 0.20 2.00 0.75

Annual control (1) 0.67 0.60 0.19 0.06 0.10 0.75 0.32

Additional administrative tasks

Disagreement on competence 0.10 0.13 0.50 0.00 0.00 0.30 0.15

Overlapping benefits 0.00 0.50 0.00 0.00 0.08 0.50 0.12

Reimbursement 0.10 0.24 0.05 0.00 0.00 0.30 0.08

Recovery 0.08 0.00 0.05 0.08 0.19 0.15 0.08

Other 0.09 0.00 0.00 0.21 0.00 0.00 0.06

TOTAL 1.36 3.70 1.92 1.21 1.46 5.25 1.93

Sources: Interviews.

Notes: (1) Annual control concerns exiting case and has so not been included in the total for new cases. (2) The UK estimates are considered too uncertain to be included in the average.

This study assesses as shown in Table 0-2 that the administrative tasks of the national administrations of primary competence are expected to increase by around one man-hour per case or by around 50% - no matter whether it is decided to implement Option 1a, Option 1b or Option 3. In other words the additional administrative efforts increase by similar amounts whether an requirement to take into account living standards in other Member States is introduced (Options 1a and 1b), or whether there is a change in the order of responsibility (Option 3). The major increase in absolute terms of man-hours is that for the calculation of benefits (around 40 minutes extra per average case). For example, where the calculations in many cases currently are being processed automatically, it will be necessary to make specific calculations in each case. In relative terms, the largest increase (around 140% = additional 6 minutes extra per average case) in the administrative burden is that for the reimbursement activity, as the more complex family benefit calculation rules are expected to lead to more cases where provisional family benefits are paid out in the Member State of secondary competence, and so have to be reimbursed by the Member State of primary competence.

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Table 0-2 Change in the man-hours per administrative task for exports of family benefit cases handled by national administrations as primary competence (simple average of case study Member States (2) )

Administrative tasks Option 1a Option 1b Option 3

manman- hours % from base hours from base man-hours from base

Standard admin. tasks

Determ. of prim. comp. 0.13 18.5% 0.13 18.5% 0.25 35.6%

Calculation of benefit 0.66 87.2% 0.66 87.2% 0.58 76.6%

Annual control (1) 0.10 30.9% 0.10 30.9% 0.08 24.8%

Additional admin. tasks

Disagr. on competence 0.00 0.0% 0.00 0.0% 0.00 0.0%

Overlapping benefits 0.03 21.7% 0.03 21.7% 0.02 13.0%

Reimbursement 0.11 144.8% 0.11 144.8% 0.10 132.0%

Recovery 0.03 31.9% 0.02 19.2% 0.02 19.2%

Other 0.00 0.0% 0.00 0.0% 0.00 0.0%

TOTAL 0.95 49.1% 0.94 48.6% 0.96 49.6%

Sources: Interviews.

Note: (1) Annual control concerns exiting case and has so not been included in total for new cases. (2) No estimates for the UK, and so excluded from the average calculation.

In monetary terms, the assessment is as shown in Table 0-3 that the revisions will lead to notable increases in total administrative costs ranging from 5,600 EUR in Poland (Option 3) to 1,156,900 EUR in Germany (Options 1a and 1b). The low figures for Poland is combination of a relative low number of cases and low labour costs, while the opposite is the case for Germany.

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Table 0-3 Change in unit costs per case and total costs handling export of family benefit cases by national administrations as primary competence – main calculation

Member State Option 1a Option 1b Option 3

Total Total

Unit Total costs costs

costs costs

Unit Unit costs 1000 costs 1000

EUR 1000 EUR EUR EUR EUR EUR

DE: Germany 18.5 1156.9 18.5 1156.9 10.3 642.7

DK: Denmark 58.3 303.3 58.3 303.3 58.3 303.3

NL: Netherlands 25.0 505.5 25.0 505.5 25.0 505.5

PL: Poland 2.2 19.0 1.9 16.7 0.6 5.6

RO: Romania 0.8 8.7 0.8 8.7 2.7 30.4

UK: United

Kingdom (1) n/a n/a n/a n/a n/a n/a

Sources: Interviews and Eurostat.

Note: (1) No estimates for the UK.

Change in administrative costs and burden for national administrations of secondary competence

The observation that most national administrations of primary competence handle a significant number of export of family benefit cases annually few cases of unemployment period aggregations implies that this also will be the case for most national administrations of secondary – as the total number of cases is the same from both perspectives for the EU as a whole. Poland experiences with 62,047 (in 2013) by far the largest number of cases, followed by Germany with 20,918 cases. In relation to the size of the national labour market, Poland handles with almost 4 cases per 1000 employed most, while at the other end the UK handles 0.11 cases per 1000 employed.

Currently, the national administrations in the case study Member States use as shown in Table 0-4 on average just above 1.5 man-hours per case, much of which is used for determining in which Member State the applicant and his/her family reside and in this context check whether the applicant is employed, unemployed, a posted worker or a civil servant. As for the national administrations of primary competence, many resources are also spent on calculating the benefits that the given applicant is entitled to according to the given national legislation. Actually, many of the national administrations do not see many differences in tasks and efforts per case being of secondary or of primary competence.

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Table 0-4 National administrations handling exports of family benefits as secondary competence, man-hours per average case

Administrative tasks DE DK NL PL RO UK Av. (2)

Standard administrative tasks

Determination of primary competence 0.50 1.00 0.57 0.69 0.12 0.75 0.58

Calculation of benefit 0.50 1.83 0.75 0.17 0.20 0.75 0.69

Annual control (1) 1.00 0.05 0.38 0.00 1.00 0.75 0.49

Additional administrative tasks

Disagreement on competence 0.10 0.13 0.05 0.00 0.05 0.30 0.07

Overlapping benefits 0.00 0.50 0.00 0.17 0.00 0.50 0.13

Reimbursement 0.10 0.24 0.05 0.00 0.00 0.30 0.08

Recovery 0.08 0.01 0.05 0.11 0.00 0.15 0.05

Other 0.00 0.17 0.00 0.00 0.00 0.00 0.03

TOTAL 1.28 3.88 1.47 1.14 0.37 2.75 1.63

Sources: Interviews.

(1)

Notes: Annual control concerns exiting case and has so not been included in total for new cases. (2) The UK estimates are considered too uncertain to be included in the average.

This study assesses as shown in Table 0-5 that the administrative tasks of the national administrations of secondary primary competence on average will increase by almost one man-hour per case or by just above 50% - if it is decided to implement Option 1 or Option 1b, and slightly less if Option 3 is implemented. In absolute terms the largest increase is by far that for the calculation of benefits as more complex calculation rules will have to be implemented. Furthermore, there will be additional communication with the relevant Member States of primary competence to deal with. In relative terms, the largest increase in the administrative burden is – similar to when being of primary competence – that for the reimbursement activity.

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Table 0-5 Change in the man-hours per administrative task for exports of family benefit cases handled by national administrations as secondary competence (simple average of case study Member States (2) )

Administrative tasks Option 1a Option 1b Option 3

manman- hours % from base hours from base man-hours from base

Standard admin. tasks

Determ. of prim. comp. 0.13 22.6% 0.13 22.6% 0.06 10.5%

Calculation of benefit 0.70 100.7% 0.61 87.7% 0.60 86.2%

Annual control (1) 0.09 18.5% 0.00 0.0% 0.19 39.1%

Additional admin. tasks

Disagr. on competence 0.00 0.0% 0.00 0.0% 0.01 15.4%

Overlapping benefits 0.02 11.4% 0.02 11.4% 0.02 11.4%

Reimbursement 0.11 144.9% 0.11 144.9% 0.09 112.8%

Recovery 0.03 50.8% 0.03 50.8% -0.01 -19.7%

Other 0.00 0.0% 0.00 0.0% 0.00 0.0%

TOTAL 0.98 60.2% 0.89 54.6% 0.76 46.7%

Sources: Interviews.

Note: (1) Annual control concerns exiting case and has so not been included in total for new cases. (2) No estimates for the UK, and so excluded from the average calculation.

In monetary terms, the assessment is as shown in Table 0-6 that the revisions will lead to increases in total administrative costs in most Member Stares – although ranging from a slight fall of 39,800 EUR in Poland (Option 1b) to 386,700 EUR in Germany (Options 1a and 1b). The fall in administrative costs for Poland in Option 1b derives from the assessment of the Polish interviewees that they can reduce their contribution to calculating benefit rates in more cases.

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Table 0-6 Change in unit costs per case and total costs handling export of family benefit cases by national administrations as secondary competence – main calculation

Member State Option 1a Option 1b Option 3

Total Total

Unit Total costs costs

costs costs

Unit Unit costs 1000 costs 1000

EUR 1000 EUR EUR EUR EUR EUR

DE: Germany 18.5 386.7 18.5 386.7 10.3 214.8

DK: Denmark 58.3 42.7 58.3 42.7 51.1 37.4

NL: Netherlands 25.0 189.2 25.0 189.2 25.0 189.2

PL: Poland 1.7 103.6 -0.6 -39.8 0.6 39.8

RO: Romania 1.4 6.4 1.4 6.4 0.8 3.5

UK: United

Kingdom (1) n/a n/a n/a n/a n/a n/a

Sources: Interviews and Eurostat.

Note: (1) No estimates for the UK.

Change in administrative costs and burden for mobile EU-citizens and their families

The proposed revisions to the EU provisions may well have implications for the mobile EU-citizens and their families. However, it is suggested that in particular Option 1a and 1b may have minor implications, while Option 3 may increase the administrative burden from increased requirements to verifications of the residence of the children. In general, the longer processing times of the cases may be consider as adverse effect. This is, for example, the assessment of the German and Danish interviewees.

Similarly, the assessment in the Netherlands, Poland and Romania is that the changes will not lead to extra tasks for the applicants. However, it is stressed that the process of handling the applications most likely will take more time why the applicant consequently must wait longer to get the application approved.

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Introduction

1.1. Background and purpose

Family benefits are intended to contribute to families' expenses, which both depend on the number and the age of the children and on the costs of living. However, in a case of export of family benefits, the family benefit amount depends on the costs of living in the Member State of primary competence rather than that of the Member State of residence

of the child – henceforth called the Member State of secondary competence 3 . For such

cases the amount of family benefits paid can be higher or lower than could be argued by the local circumstances where the family resides.

On this background, this present study looks into the following three possible revisions to Regulation (EC) No 883/2004 i:

• Option 3 4 : Change in the current order of priority: (1) Member State of residence of the child [secondary competence], (2) Member State of work [primary

3 Not that the Member State of residence of the child is not always the state of secondary competence. For example, where both parents are economically active it will be the Member State of primary competence

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Such revisions may affect the behaviour of the mobile EU-citizens and their families, the amounts of exported family benefits being paid, and the administration needed to handle the export of family benefit cases. The analysis within Task 1 focuses on the latter issue – i.e. the changes in administrative costs and burden from the revisions to the national administrations handling exports of family benefits. In this context, Task 1 distinguishes between the administrative costs incurring in the Member States of primary competence and those incurring in the Member States of secondary competence. Furthermore, we look into the possible changes in the administrative burden for the mobile EU-citizens themselves and their families.

However, as described further below there is no official information available on the costs of the different administrative tasks carried out by the national administrations in the Member States when handling a case of export of family benefits. Therefore, we have obtained this information from its primary sources via interviews with national administrations. It was not feasible within the scope of Task 1 to gather such information for all 28 EU Member States. Hence, the results are based on analyses for six case study Member States: Germany, Denmark, Netherlands, Poland, Romania, and the UK.

1.2. Methodology

As just introduced above, Task 1 focuses on assessing the administrative costs and burden for the national administrations handling cases of export of family benefit. For this, we have made use of the definition of administrative costs and burden provided by the EC (2009) Impact Assessment Guidelines. While doing this, we have adopted a broad definition of administrative information obligations – i.e. we have considered the costs of administrative tasks such as the determination of Member State of competence, the calculation of benefits, and the reimbursement and recovery of benefits in between Member States. We have then assessed how these administrative costs may change from the revisions to Regulation (EC) No 883/2004 i to comprise an additional administrative burden – positive or negative – for the national administrations as well as for the mobile EU-citizens and their families. This approach is also in line with the Better Regulation Guidelines (EC, 2015) emphasises objective of delivering maximum benefits to citizens, businesses and workers while avoiding all unnecessary regulatory burdens, and so avoiding unnecessary additional administrative burdens.

The calculations of the administrative costs for the national administrations are as illustrated in Figure 1-1 in principle simple. Firstly, the number of cases in the left-hand side of the figure are the annual cases of exports of family benefits currently registered in the six case study Members States. Actually, a given case may be dealt with in two of the six selected Member States if, for example, a given applicant for exports of family benefits (i.e. in a Member State of primary competence) has his/her family residing in another of the six Member States (i.e. in a Member State of secondary competence). In our main calculation, we assume that the number of cases does not change as a result of revisions to the EU provisions. However, we do to illustrate the sensitivity of this assumption also show a scenario where we assume a change in the number of cases based on the results of Task 3 of this study.

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practice looking for average costs. These unit costs in EUR are composed of assessments of the man-hours needed per case and the costs per man-hour in EUR (see Table 1-1 in the next section).

Figure 1-1 Calculation of administrative costs for national administrations

As indicated in Figure 1-1, the estimations of the current number of cases have been provided by the HIVA KU Leuven Research Institute for Work and Society (HIVA) via a data gathering exercise (see Pacolet and De Wispelaere, 2015).

The bulk of the work within Task 1 has been the estimation of the man-hours needed to carry out the administrative tasks of handling a case of export of family benefits. As already mentioned, such information is not available from official sources, and so we have gathered the information through interviews with national administrations in the six case study Member States. For this purpose, we identified the national administrations to interview (see Annexes C to H for the interviewees), and we developed an interview guide that was shared with our Member States experts/interviewers in the six case study Member States in their respective national languages (see Annex B for the English version of the interview guide). The interview guide was developed via a desk study approach by reviewing existing literature and guidance papers on the legislation (see Annex A) and it was tested in Denmark before being applied in the five other case study Member States.

From the Member State-specific analyses in Annexes C to H, it becomes clear that most of the man-hour estimates are based on a few interviews only. This is partly because there is often only a few national administrations that handle export of family benefit cases in each of the Member States, and partly because of limited interview resources. Hence, the premise for this analysis is the uncertainty associated with few assessments that, furthermore, mostly are based on the subjective assessments of the interviewees rather than on actual registrations of time spent on different administrative tasks. It has therefore not been feasible within the present study period to further validate the administrative cost estimates, but these may well be commented upon by national administrations in the non-case study Member States once this report is released. In this context, it should be underlined that although there are some differences in the assessments both within and in between the Member States, the overall the assessed levels of administrative costs and the additional burdens from the possible revisions to the EU provisions do compare. Finally, the assessed additional burdens can be argued to be low, in particular in absolute terms for a Member State as a whole. Hence, they may well be lower that the socioeconomic benefits caused by the revisions.

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1.3. Case study Member States

As already mentioned, the calculations of the administrative costs and burden are based on information for six case study Member States only. Although, it is not the aim of Task 1 to produce a total EU-28 figure for the administrative costs and burden via an upscaling of the calculations from the case studies, we have aimed to select Member States that represent the variety within the EU.

Firstly, we have selected Member States that are geographically spread across the EU. Secondly, the selection comprises Member States that mainly attract mobile EU-citizens (Germany, Denmark, Netherlands, UK), and Member States that mainly see citizens leave (Poland, Romania). Thirdly, child benefits rules and amounts differ in between Member States 5 . Whereas there are Member States that provide fixed benefit amounts (Germany, Netherlands), others provide means-tested amounts that are fixed to thresholds (Poland, Romania). Some rules specify that children residing in the Member State can receive child benefits (Denmark, Romania, UK), while others link the child benefit to the place of taxation of the parent (Germany, Netherlands). Furthermore, the amounts of child benefits paid in the Member States vary widely.

Finally, as shown in Table 1-1, the unit labour costs of the national administrations differ much in between the case study Member States. We assume here that the average wage levels of the relevant employees in the national administrations are similar to that of employees in general in the public administration with upper secondary or postsecondary non-tertiary education. Although the differences in labour costs is a reflection of general differences in labour costs in between the Member States, it could be expected that this may lead to differences in the use of man-power to carry out the administrative tasks. It could, for example, be expected that higher labour costs could lead to fewer labour-intensive processes – and vice versa. However, as shown below such difference have not been detected in between higher and lower labour cost Member States.

Table 1-1 Labour costs, 2013, EUR per hour - employees in public administration etc. with upper secondary or post-secondary non-tertiary education

Member State Wage costs, Wage costs, Labour costs, 2010, 2013, 2013,

EUR per hour (1) (2) EUR per hour EUR per hour (3)

DE: Germany 14.9 16.4 20.5

DK: Denmark 22.3 23.4 29.3

NL: Netherlands 16.4 17.8 22.2

PL: Poland 3.8 4.1 5.1

RO: Romania 1.7 2.0 2.5

UK: United Kingdom 14.3 14.7 18.4

Sources: (1) Eurostat, Earnings survey, 2010 [the most recent] (earn_ses10_16). (2) 2013 estimates on the basis of Eurostat, Labour cost index ([lc_lci_r2_a). (3) Using 25% overhead costs according to EC Impact Assessment Guidelines.

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Current administrative costs and burden

1.4. National administrations

The export of family benefit cases are handled by similar types of national administrations in the case study Member States. In Denmark, all cases – both when being of primary competence and of secondary competence – are carried out by one institution: Udbetaling Denmark. In Germany it is Die Bundesagentur für Arbeit, in the Netherlands: Sociale Verzekeringsbank, and in the UK: Her Majesty's Revenue and Customs. In Poland and Romania, the handling of cases takes place at both national and regional level. In Poland, it is the Ministry of Labour and Social Policy and the Regional Social Policy Centres (Krakow and Opole), respectively. In Romania, it is the National Agency for Payments and Social Inspection and county agencies, respectively.

The below box describes two possible examples of exports of family benefits currently handled by the national administrations. Parent A receives in both examples family benefits from the Member State [primary competence] where he works according to its rules.

Example 1 of exports of family benefits:

Parent A works in Member State A [primary competence] which has a higher cost of living than

Member State B [secondary competence] while his non-working wife Parent B resides with their children in Member State B.

Under the current rules, Parent A is entitled to family benefits in Member State A at the same amount as if his family was residing in Member State A.

Example 2 of exports of family benefits:

Parent A works in Member State B [primary competence] while his non-working wife Parent B resides with their children in Member State A [secondary competence].

Under the current rules, Parent A is entitled to family benefits in Member State B at the same amount as if his family was residing in Member State B.

National administrations with primary competence

Table 2-1 shows that the number of cases handled by national administrations with primary competence varied between the case study Member States in 2013 6 . This is not surprising given the difference in the sizes of the Member States, and that we both have selected some that mainly attract mobile EU-citizens and some that mainly see citizens leave. However when looking at the number of cases relative to the sizes of the labour markets, the differences are less noticeable. While the Netherlands in 2013 experienced 2.42 cases per 1000 employed in the Netherlands as a whole, it was at the other end 0.56 cases per employed in Poland and 0.68 cases per employed in the UK

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Table 2-1 Number of exports of family benefits handled by national administrations in 2013 as primary competence

Member State Number of cases, 2013 Cases per 1000 employed

DE: Germany 62587 1.58

DK: Denmark (1) 5200 1.93

NL: Netherlands 20225 2.42

PL: Poland 8698 0.56

RO: Romania 11427 1.34

UK: United Kingdom 20271 0.68

Sources: Pacolet and De Wispelaere (2015). Eurostat database (lfsi_emp_a).

Note: (1) Estimate provided by the Danish national expert.

Table 2-2 shows for the six case study Member States, the man-hours per average case for the national administrations handling exports of family benefits as primary competence. The administrative tasks are divided into standard administrative tasks and additional administrative tasks.

The former tasks, which are carried out for almost all cases, comprise the determination of the national administration with primary competence – i.e. for each application for exports of family benefits, and for each of the applications, the national administration will determine in which Member State the applicant and his/her family reside and in this context check whether the applicant is employed, unemployed, a posted worker or a civil servant.

The national administration with primary competence will then calculate the benefits that the given applicant is entitled to according to the given national legislation. This involves contacting the Member State of residence of the applicant's family to investigate the applicant's entitlement to family benefits in this Member State – i.e. to check for overlapping benefits, and it involves setting the payment of family benefits in motion.

Furthermore, for each of the existing cases there will be an annual control to check whether the information/status of the applicant and his/her family has changed.

The latter tasks, which are carried out more infrequently for the more complex cases, comprise, for example, disagreements regarding the determination of the national administration having the primary competence. Such disagreement will lead to additional exchanges of information, to provision of provisional benefits, and ultimately from bringing the case before the Administrative Commission. Table 2-2 shows that this task for an average case in a Member States takes between zero and one hour. However, from the Member State-specific analyses in Annexes C to H, it e.g. shows that for Germany the 0.1 hours (around 7 minutes) per average case covers over that this task only is carried out in 5% of the cases, while each of these cases requires around two man-hours. Similarly, the 0.13 hours in Denmark cover over that such task is only carried out in 5% of the case – where the actual time spent on such rare cases typically amount to 2.5 hours.

In contrast, the 0.5 hours on average spent in Denmark on handling the issue of overlapping benefits, hereunder on deciding on a possible sharing of benefit payments, is

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0.08 man-hours cover over that such task is only carried out for 5% of the cases – each typically requiring 1.5 man-hours.

Overall, Table 2-2 shows that currently the resources spent on a case being the national administration of primary competence averages around two man-hours. UK 7 and Denmark are outliers at the high end, which appears to be caused by relative much emphasis on the benefit calculations, hereunder on overlapping benefits and reimbursements if provisional benefits have been paid by another Member State. Poland, Germany and Romania are at the lower end with relatively few resources spent on additional administrative tasks.

Table 2-2 National administrations handling exports of family benefits as primary competence, man-hours per average case

Administrative tasks DE DK NL PL RO UK (2) Av.

Standard administrative tasks

Determination of prim. competence 0.50 1.00 0.57 0.44 1.00 2.00 0.70

Calculation of benefit 0.50 1.83 0.75 0.47 0.20 2.00 0.75

Annual control (1) 0.67 0.60 0.19 0.06 0.10 0.75 0.32

Additional administrative tasks

Disagreement on competence 0.10 0.13 0.50 0.00 0.00 0.30 0.15

Overlapping benefits 0.00 0.50 0.00 0.00 0.08 0.50 0.12

Reimbursement 0.10 0.24 0.05 0.00 0.00 0.30 0.08

Recovery 0.08 0.00 0.05 0.08 0.19 0.15 0.08

Other 0.09 0.00 0.00 0.21 0.00 0.00 0.06

TOTAL 1.36 3.70 1.92 1.21 1.46 5.25 1.93

Sources: Interviews.

Notes: (1) Annual control concerns exiting case and has so not been included in the total for new cases. (2) The UK estimates are considered too uncertain to be included in the

average.

When accounting for the differences in labour costs shown in Table 1-1, Table 2-3 shows that the average unit administrative costs in EUR differ more that the average man-hours shown in Table 2-2. The reason is that the high labour costs Members States, Denmark and the Netherlands, also spend relatively most man-hours. This could be argued to be a surprising result, i.e. it could be expected that higher labour costs could lead to less labour-intensive processes.

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The lower labour costs and man-hours spent in Poland and Romania imply that an average case costs around 4 to 6 EUR, while it in Denmark reaches above 100 EUR and in the Netherlands above 40 EUR. However, looking at total costs, Germany and the UK have with their many cases the highest current costs.

Table 2-3 Administrative costs for national administrations handling exports of family benefits as primary competence, unit costs and total costs 2013, EUR

DE DK NL PL RO UK Av. (1)

Unit costs, EUR 28.0 108.5 42.7 6.2 3.7 96.4 37.8

Total costs, 1000 EUR 1751.4 564.0 862.7 53.9 42.3 1955.1

Sources: Table 1-1, Table 2-1, and Table 2-2.

Note: (1) The UK estimates are considered too uncertain to be included in the average.

National administrations with secondary competence

Table 2-4 then shows the number of cases handled by national administrations as secondary competence in the case study Member States in 2013 provided by Pacolet and De Wispelaere (2015). Poland experiences the largest number of cases, followed by Germany. Compared with the size of the labour market – i.e. with the number of employed in the Member States as a whole – Poland has in relative terms the highest number of cases with around four cases per 1000 employed. Member States that mainly attract mobile EU-citizens such as the UK and Denmark handle relatively few cases.

Table 2-4 Number of exports of family benefits handled by national administrations in 2013 as secondary competence

Member State Number of cases, 2013 Cases per 1000 employed

DE: Germany 20918 0.53

DK: Denmark 732 0.27

NL: Netherlands 7569 0.90

PL: Poland 62047 3.99

RO: Romania 4616 0.54

UK: United Kingdom 3391 0.11

Sources: Pacolet and De Wispelaere (2015). Eurostat database (lfsi_emp_a).

Table 2-5 shows for the six case study Member States, the man-hours per average case for the national administrations handling exports of family benefits as secondary competence. The administrative tasks are divided into standard administrative tasks and additional administrative tasks.

It must firstly be underlined that many of the national administrations do not see many differences in tasks and efforts per case being of secondary or of primary competence.

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determination of primary competence, when it shows that its national administration is of secondary competence.

For example, in Romania the average resources spend on a case is 0.12 man-hours when being the national administration of secondary competence while it is 1 man-hour when being of primary competence. This is both due to fewer resources spend when the task is actually carried out being of secondary competence (0.6 man-hours) and the assessment that the task only is carried out for 20% of the cases.

Table 2-5 National administrations handling exports of family benefits as secondary competence, man-hours per average case

Administrative tasks DE DK NL PL RO UK Av. (2)

Standard administrative tasks

Determination of primary competence 0.50 1.00 0.57 0.69 0.12 0.75 0.58

Calculation of benefit 0.50 1.83 0.75 0.17 0.20 0.75 0.69

Annual control (1) 1.00 0.05 0.38 0.00 1.00 0.75 0.49

Additional administrative tasks

Disagreement on competence 0.10 0.13 0.05 0.00 0.05 0.30 0.07

Overlapping benefits 0.00 0.50 0.00 0.17 0.00 0.50 0.13

Reimbursement 0.10 0.24 0.05 0.00 0.00 0.30 0.08

Recovery 0.08 0.01 0.05 0.11 0.00 0.15 0.05

Other 0.00 0.17 0.00 0.00 0.00 0.00 0.03

TOTAL 1.28 3.88 1.47 1.14 0.37 2.75 1.63

Sources: Interviews.

(1)

Notes: Annual control concerns exiting case and has so not been included in total for new cases. (2) The UK estimates are considered too uncertain to be included in the average.

Table 2-6 therefore also shows a similar picture to that of Table 2-3 with the highest average unit administrative costs in EUR found in Denmark, followed by the UK, the Netherlands and Germany. However, looking at the total costs, Germany and Poland have as a result of handling many cases the highest costs.

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Table 2-6 Administrative costs for national administrations handling exports of family benefits as secondary competence, unit costs and total costs 2013, EUR

DE DK NL PL RO UK (1) Av.

Unit costs, EUR 26.2 113.6 32.7 5.8 0.9 50.5 35.8

Total costs, 1000 EUR 547.8 83.1 247.2 362.9 4.3 171.3

Sources: Table 1-1, Table 2-4, and Table 2-5.

Note: (1) The UK estimates are considered too uncertain to be included in the average.

1.5. Mobile EU-citizens and their families

The interviews carried out in the six case study Member States have not revealed many concerns about the time spent at present by the mobile EU-citizens and their families when applying for exports of family benefits. However, as discussed in Section 3.2 the possible revisions to the EU provisions may well have implications.

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Change in administrative costs and burden from revised EU provisions

1.6. National administrations

The administrative tasks of handling a case of export of family benefits may change in both size and characteristics if the EU provisions are revised. In this study we look, as introduced in Section 1.1, into the following three possible revisions, that each are exemplified in the below boxes.

Option 1a: Adjustment of the amount of exported family benefits to the living standard in the Member State of secondary competence (residence of the child) – i.e. adjustment upwards or downwards compared to current situation.

Example 1 of new situation:

Parent A works in Member State A [primary competence] while his nonworking wife Parent B resides with their children in Member State B [secondary competence].

Under the revised rules, Parent A will receive family benefits from Member

State A reduced to the living standard in Member State B.

Example 2 of new situation:

Parent A works in Member State B [primary competence] while his nonworking wife Parent B resides with their children in Member State A [secondary competence].

Under the revised rules, Parent A will receive family benefits from Member

State B increased to the living standard in Member State A.

Option 1b: Adjustment of the amount of exported family benefits to the living standard in the Member State of secondary competence – limited to the amount provided by the Member State of primary competence.

Example 1 of new situation:

Parent A works in Member State A [primary competence] while his non-working wife Parent B resides with their children in Member State B [secondary competence].

Under the revised rules, Parent A will receive family benefits from Member State A reduced to the living standard in Member State B.

Example 2 of new situation:

Parent A works in Member State B [primary competence] while his non-working wife Parent B resides with their children in Member State A [secondary competence].

Under the revised rules, Parent A will receive family benefits from Member State B to the maximum of the rate in Member State B, irrespective of the fact that the living standard in Member State A is higher.

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Option 3: Change in the current order of priority: (1) Member State of residence of the child [secondary competence], (2) Member State of work [primary competence], and (3) Member State of pension [primary competence].

Example 1 of new situation:

Parent A works in Member State A [primary competence] (which has a higher cost of living than Member State B) while his non-working wife Parent B resides with their children in Member State B [secondary competence] (which has a lower cost of living than Member State A).

Under the revised rules, Parent A will receive family benefits from Member State B at the normal national rate to which the entitlement exists under its national rules. If the family is also entitled to benefits from Member State A, the family would receive a differential supplement from Member State A to the level paid under its national legislation. The family overall receives the same amount, but Parent A receives less from Member State A than his co-workers whose children reside with them in Member State A.

Example 2 of new situation:

Parent A works in Member State B [primary competence] (which has a lower cost of living than Member State A) while his non-working wife Parent B resides with their children in Member State A [secondary competence] (which has a higher cost of living than Member State B).

Under the revised rules, Parent A will receive family benefits from Member State B at the normal national rate to which the entitlement exists under its national rules. As the amount of family benefits paid in Member State B is lower than the amount paid by Member State A, Member State B will pay nothing. The family overall receives the same amount, but Parent A receives less from Member State B than his co-workers whose children reside with them in Member State B.

National administrations with primary competence

As described in Section 1.2, we assume in the main calculations that the number of cases does not change as a result of revisions to the EU provisions. Hence, in the main calculations the changes in administrative costs and burden are solely a result of changes to the unit administrative costs. Table 3-1 shows a simple average – while we refer to the annexes regarding insight into the more specific Member State calculations.

A first important observation is that on average across the case study Member States, the interviewed national administrations expect that their administrative tasks as primary competence will increase by around one man-hour per case or by around 50% - no matter whether it is decided to implement Option 1a, Option 1b or Option 3. In other words, the additional administrative efforts increase by similar amounts whether an requirement to take into account living standards in other Member States is introduced (Options 1a and 1b), or whether there is a change in the order of responsibility (Option 3).

The major increase in absolute terms of man-hours is that for the calculation of benefits.

For example, where the calculations in many cases currently are being processed automatically, it will be necessary to make specific calculations in each case. For

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there is a need for additional contacts with national administrations in other Member States.

In relative terms, the largest increase in the administrative burden is that for the reimbursement activity, as the more complex family benefit calculation rules are expected to lead to more cases where provisional family benefits are paid out in the Member State of secondary competence, and so have to be reimbursed by the Member State of primary competence. Similarly, the more complex calculation rules are expected to lead to more cases where applicants unjustified have received family benefits, that then need to be recovered.

Table 3-1 Change in the man-hours per administrative task for exports of family benefit cases handled by national administrations as primary competence (simple

average of case study Member States (2) )

Administrative tasks Option 1a Option 1b Option 3

manman- hours % from base hours from base man-hours from base

Standard admin. tasks

Determ. of prim. comp. 0.13 18.5% 0.13 18.5% 0.25 35.6%

Calculation of benefit 0.66 87.2% 0.66 87.2% 0.58 76.6%

Annual control (1) 0.10 30.9% 0.10 30.9% 0.08 24.8%

Additional admin. tasks

Disagr. on competence 0.00 0.0% 0.00 0.0% 0.00 0.0%

Overlapping benefits 0.03 21.7% 0.03 21.7% 0.02 13.0%

Reimbursement 0.11 144.8% 0.11 144.8% 0.10 132.0%

Recovery 0.03 31.9% 0.02 19.2% 0.02 19.2%

Other 0.00 0.0% 0.00 0.0% 0.00 0.0%

TOTAL 0.95 49.1% 0.94 48.6% 0.96 49.6%

Sources: Interviews.

Note: (1) Annual control concerns exiting case and has so not been included in total for new cases. (2) No estimates for the UK could be provided by the UK national administration, and so excluded from the average calculation.

Table 3-2 then shows the change in the unit costs per case, in EUR and total costs in EUR for each of the case study Member States. It shows that the estimated total cost

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(Options 1a and 1b). The low figures for Poland is combination of a relative low number of cases and low labour costs, while the opposite is the case for Germany.

Table 3-2 Change in unit costs per case and total costs handling export of family benefit cases by national administrations as primary competence – main calculation

Member State Option 1a Option 1b Option 3

Total Total

Unit Total costs costs

costs costs

Unit Unit costs 1000 costs 1000

EUR 1000 EUR EUR EUR EUR EUR

DE: Germany 18.5 1156.9 18.5 1156.9 10.3 642.7

DK: Denmark 58.3 303.3 58.3 303.3 58.3 303.3

NL: Netherlands 25.0 505.5 25.0 505.5 25.0 505.5

PL: Poland 2.2 19.0 1.9 16.7 0.6 5.6

RO: Romania 0.8 8.7 0.8 8.7 2.7 30.4

UK: United

Kingdom (1) n/a n/a n/a n/a n/a n/a

Sources: Interviews and Eurostat.

Note: (1) No estimates for the UK could be provided by the UK national administration.

The number of cases are, however, likely to change as a result of revisions to the EU provisions. There might be changes due to changing eligibility criteria for qualifying for export of family benefits and due to changing benefit incomes that affect the behaviour of the mobile EU-citizens. Task 3 of the present study has estimated such behavioural changes. We have on the basis of the behavioural change estimates for families composed of one-earner married couples with two children at 100% of average earnings derived assumptions about the likely change in the number of cases handled by national administrations as primary competence (cf. Table 3-3). Hence, implying that fewer mobile EU-citizens stay in these Member States and claim family benefits. In contrast, it will become relatively more attractive to stay in Member States with lower living standards such as Poland and Romania, and claim family benefits from other Member States (where the children reside).

A similar picture is found for Option 1b for the Member States with high living standards as family incomes fall for mobile EU-citizens claiming family benefits. However, those claiming benefits in Member States with low livings standards will not experience any change in family incomes.

Finally, FGB et.al. (2015) assume that Option 3 only will lead to a redistribution of competence from the Member State of primary competence to the Member State of secondary competence. Hence, there will be no impact on family incomes and so on mobility.

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Table 3-3 Change in number of exports of family (1) benefit cases handled by national administrations as primary competence

Member State Option 1a Option 1b Option 3

DE: Germany -3.1% -3.2% 0%

DK: Denmark (2) -3.5% -3.6% 0%

NL: Netherlands -4.0% -4.0% 0%

PL: Poland 3.2% 0.0% 0%

RO: Romania 8.3% 0.0% 0%

UK: United

Kingdom (2) -3.5% -3.6% 0%

Sources: FGB et.al. (2015): Annex 2 - Table 2.1.

(1)

Notes: Estimation for "one-earner married couples with two children at 100% of average earnings". (2) As no estimates are provided for Denmark and the UK, we have assumed/used simple average of the changes for Germany and the Netherlands.

Adjusting the main results for such possible changes in the number of cases we get as shown in Table 3-4 slightly different results. While unit cost changes are similar to those presented in Table 3-2, Options 1a and 1b lead to lower total costs increases in Member States such as Denmark and the Netherlands as the number of cases to handle decreases.

Table 3-4 Change in unit costs per case and total costs handling export of family benefit cases by national administrations as primary competence – assuming changes in the number of cases

Member State Option 1a Option 1b Option 3

Total

Unit

costs Total costs

Unit Unit costs

costs Total costs costs 1000

EUR 1000 EUR EUR 1000 EUR EUR EUR

DE: Germany 18.5 1068.1 18.5 1063.0 10.3 642.7

DK: Denmark 58.3 272.7 58.3 272.0 58.3 303.3

NL: Netherlands 25.0 450.9 25.0 450.9 25.0 505.5

PL: Poland 2.2 21.3 1.9 16.7 0.6 5.6

RO: Romania 0.8 12.9 0.8 8.7 2.7 30.4

UK: United

Kingdom (1) n/a n/a n/a n/a n/a n/a

Sources: FGB et.al. (2015): Annex 2 - Table 2.1, Eurostat and interviews.

Note: (1) No estimates for the UK could be provided by the UK national administration.

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National administrations with secondary competence

Table 3-5 shows that the expectations to changes in man-hours are fairly similar to those in Table 3-1 regarding primary competence. This is as already mentioned partly a consequence of that many of the national administrations do not see many differences in tasks and efforts per case being of secondary or of primary competence. Hence, the observations are also fairly similar to those for Table 3-1.

Hence, in absolute terms the largest increase is by far that for the calculation of benefits as more complex calculation rules will have to be implemented. Furthermore, there will be additional communication with the relevant Member States of primary competence to deal with.

In relative terms, the largest increase in the administrative burden is – similar to when being of primary competence – that for the reimbursement activity. There will be additional needs to request reimbursements from Member States of primary competence of provisionally paid family benefits. Furthermore, the more complex calculation rules in Options 1a and 1b are expected to lead to more cases where applicants unjustified have received family benefits, and so a need to contribute to this task. In contrast, it is assessed that the redistribution of competences in Option 3 may lead to a slightly lower need for recovery activities.

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Table 3-5 Change in the man-hours per administrative task for exports of family benefit cases handled by national administrations as secondary competence (simple average of case study Member States (2) )

Administrative tasks Option 1a Option 1b Option 3

manman- hours % from base hours from base man-hours from base

Standard admin. tasks

Determ. of prim. comp. 0.13 22.6% 0.13 22.6% 0.06 10.5%

Calculation of benefit 0.70 100.7% 0.61 87.7% 0.60 86.2%

Annual control (1) 0.09 18.5% 0.00 0.0% 0.19 39.1%

Additional admin. tasks

Disagr. on competence 0.00 0.0% 0.00 0.0% 0.01 15.4%

Overlapping benefits 0.02 11.4% 0.02 11.4% 0.02 11.4%

Reimbursement 0.11 144.9% 0.11 144.9% 0.09 112.8%

Recovery 0.03 50.8% 0.03 50.8% -0.01 -19.7%

Other 0.00 0.0% 0.00 0.0% 0.00 0.0%

TOTAL 0.98 60.2% 0.89 54.6% 0.76 46.7%

Sources: Interviews.

Table 3-6 then shows the change in the unit costs per case, in EUR and total costs in EUR for each of the case study Member States. It shows that costs are actually expected to fall slightly in Poland in the case of Option 1b, while the highest unit cost increases are expected for Denmark, the Netherlands and Germany.

The fall in administrative costs for Poland in Option 1b derives from the assessment of the Polish interviewees that they can reduce their contribution to calculating benefit rates in more cases.

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Table 3-6 Change in unit costs per case and total costs handling export of family benefit cases by national administrations as secondary competence – main calculation

Member State Option 1a Option 1b Option 3

Total Total

Unit Total costs Unit costs

costs costs

Unit costs 1000 costs 1000

EUR 1000 EUR EUR EUR EUR EUR

DE: Germany 18.5 386.7 18.5 386.7 10.3 214.8

DK: Denmark 58.3 42.7 58.3 42.7 51.1 37.4

NL: Netherlands 25.0 189.2 25.0 189.2 25.0 189.2

PL: Poland 1.7 103.6 -0.6 -39.8 0.6 39.8

RO: Romania 1.4 6.4 1.4 6.4 0.8 3.5

UK: United

Kingdom (1) n/a n/a n/a n/a n/a n/a

Sources: Interviews and Eurostat.

Note: (1) No estimates for the UK could be provided by the UK national administration.

The likely change in the number of cases as a result of revisions to the EU provisions will also be experienced by the national administrations with secondary competence. Table 3- 7 shows our estimates/assumptions for these likely changes. Since the relative attractiveness of the Member States with high living standards decreases there will be relatively more mobile EU-citizens leaving for other Member States and so leave their families behind in the Member State of secondary competence. This effect goes the other way for Member States with lower living standards.

Table 3-7 Change in number of exports of family (1) benefit cases handled by national administrations as secondary competence

Member State Option 1a Option 1b Option 3

DE: Germany 0.7% -1.0% 0%

DK: Denmark (2) 2.0% -0.5% 0%

NL: Netherlands 3.3% 0.0% 0%

PL: Poland -3.2% -3.2% 0%

RO: Romania -3.7% -3.7% 0%

UK: United

Kingdom (2) 2.0% -0.5% 0%

Sources: FGB et.al. (2015): Annex 2 - Table 2.1.

Notes: (1) Estimation for "one-earner married couples with two children at 100% of average earnings". (2) As no estimates are provided for Denmark and the UK, we have assumed/used simple average of the changes for Germany and the Netherlands.

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Adjusting the main results for such possible changes in the number of cases we get as shown in Table 3-8 slightly different results than those in Table 3-6. The fewer cases in Poland and Romania implies that the total cost figures are lower than those in Table 3-6, and in turn the total cost figures are higher for the remaining four case study Member States.

Table 3-8 Change in unit costs per case and total costs handling export of family benefit cases by national administrations as secondary competence – assuming changes in the number of cases

Member State Option 1a Option 1b Option 3

Total Total

Unit Total costs Unit costs

costs costs

Unit costs 1000 costs 1000

EUR 1000 EUR EUR EUR EUR EUR

DE: Germany 18.5 392.8 18.5 377.7 10.3 214.8

DK: Denmark 58.3 45.2 58.3 42.1 51.1 37.4

NL: Netherlands 25.0 203.7 25.0 189.2 25.0 189.2

PL: Poland 1.7 88.6 -0.6 -50.2 0.6 39.8

RO: Romania 1.4 6.0 1.4 6.0 0.8 3.5

UK: United

Kingdom (1) n/a n/a n/a n/a n/a n/a

Sources: FGB et.al. (2015): Annex 2 - Table 2.1, Eurostat and interviews.

Note: (1) No estimates for the UK could be provided by the UK national administration.

1.7. Mobile EU-citizens and their families

The interviews carried out in the six case study Member States indicate that the proposed revisions to the EU provisions may well have implications for the mobile EU-citizens and their families. However, many interviewees suggest that in particular Option 1a and 1b may have minor implications, while Option 3 may increase the administrative burden from increased requirements to verifications of the residence of the children. In general, the longer processing times of the cases may be consider as adverse effect. This is, for example, the assessment of the German and Danish interviewees.

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Conclusions

Revising the current rules for export of family benefits specified in Regulation (EC) No 883/2004 i will have impact on the administrative costs and burden of the national administration in the Member States handling cases where mobile EU-citizens apply for family benefits – both in the Member States where the application is submitted (Member State of primary competence) and in those where the children reside. Furthermore, the applying EU-citizens and their families will experience changes in the own administrative burden from the revisions. The overall conclusion from this study is that the impacts are expected to be notable in a number of Member States – a conclusion that is based on assessments made in six case study Member States: Germany, Denmark, the Netherlands, Poland, Romania, and the UK.

Change in administrative costs and burden for national administrations of primary competence

Currently, the national administrations in the case study Member States use on average around 2 man-hours per case, much of which is used for determining in which Member State the applicant and his/her family reside and in this context check whether the applicant is employed, unemployed, a posted worker or a civil servant. Relatively many resources are also spent on calculating the benefits that the given applicant is entitled to according to the given national legislation. This involves contacting the Member State of residence of the applicant's family to investigate the applicant's entitlement to family benefits in this Member State – i.e. to check for overlapping benefits, and it involves setting the payment of family benefits in motion. The UK and Denmark spend most resources per case, while the other case study Member States are at a lower but similar level.

This study assesses that the administrative tasks of the national administrations of primary competence will increase by around one man-hour per case or by around 50% - no matter whether it is decided to implement Option 1a, Option 1b or Option 3. In other words the additional administrative efforts increase by similar amounts whether an requirement to take into account living standards in other Member States is introduced (Options 1a and 1b), or whether there is a change in the order of responsibility (Option 3). The major increase in absolute terms of man-hours is that for the calculation of benefits (around 40 minutes extra per average case). For example, where the calculations in many cases currently are being processed automatically, it will be

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increase (around 140% = additional 6 minutes extra per average case) in the administrative burden is that for the reimbursement activity, as the more complex family benefit calculation rules are expected to lead to more cases where provisional family benefits are paid out in the Member State of secondary competence, and so have to be reimbursed by the Member State of primary competence.

In monetary terms, the assessment is that the revisions will lead to notable increases in total administrative costs ranging from 5,600 EUR in Poland (Option 3) to 1,156,900 EUR in Germany (Options 1a and 1b). The low figures for Poland is combination of a relative low number of cases and low labour costs, while the opposite is the case for Germany.

Change in administrative costs and burden for national administrations of secondary competence

Currently, the national administrations in the case study Member States use on average just above 1.5 man-hours per case, much of which is used for determining in which Member State the applicant and his/her family reside and in this context check whether the applicant is employed, unemployed, a posted worker or a civil servant. As for the national administrations of primary competence, many resources are also spent on calculating the benefits that the given applicant is entitled to according to the given national legislation. Actually, many of the national administrations do not see many differences in tasks and efforts per case being of secondary or of primary competence

This study assesses that the administrative tasks of the national administrations of secondary primary competence on average will increase by almost one man-hour per case or by just above 50% - if it is decided to implement Option 1 or Option 1b, and slightly less if Option 3 is implemented. In absolute terms the largest increase is by far that for the calculation of benefits as more complex calculation rules will have to be implemented. Furthermore, there will be additional communication with the relevant Member States of primary competence to deal with. In relative terms, the largest increase in the administrative burden is – similar to when being of primary competence – that for the reimbursement activity.

In monetary terms, the assessment is that the revisions will lead to increases in total administrative costs in most Member Stares – although ranging from a slight fall of 39,800 EUR in Poland (Option 1b) to 386,700 EUR in Germany (Options 1a and 1b). The fall in administrative costs for Poland in Option 1b derives from the assessment of the Polish interviewees that they can reduce their contribution to calculating benefit rates in more cases.

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Annex A – Literature

EC (2009), Impact Assessment Guidelines, http://ec.europa.eu/smartregulation/impact/commission_guidelines/docs/iag_2009_en.pdf

EC (2015), Commission staff working document, Better Regulation Guidelines, SWD(2015) 111 final, http://ec.europa.eu/smartregulation/guidelines/docs/swd_br_guidelines_en.pdf

Eurostat database, http://ec.europa.eu/eurostat/data/database

FGB, COWI and IER (2015), Task 3, Draft Final Report, 31 July 2015.

Regulation (EC) No 883/2004 i of the European Parliament and of the Council of 29 April 2004 on the coordination of social security systems, http://eurlex.europa.eu/LexUriServ/LexUriServ.do?uri=OJ:L:2004:166:0001:0123:en:PDF

Pacolet, J and F De Wispelaere (2015), Export of family benefits, Report on the questionnaire on the export of family benefits, July 2015.

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Annex B – Interview guide

The attached interview guide is the actual version used for the interviews in the UK, and is so in English. The interview guide was provided to the Member States experts in their national languages.

Note that we in the interview guide make use of the option titles: Revisions (A), (B), and (C), rather than Options 1a, 1b, and 3 – as in the report. The reason for this was to avoid discussing what happened to Option 2.

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EUROPEAN COMMISSION, DG EMPLOYMENT, SOCIAL AFFAIRS AND INCLUSION

Study to analyse and assess the impacts of policy options for a possible EU initiative in

the area of coordination of social security schemes, in particular with regard to the

revision of the current EU provisions on entitlement to unemployment benefits and

export of family benefits

Interview guide:

National administrations handling exports of family benefits

The European Commission, Directorate-General for Employment, Social Affairs and Inclusion has given Fondazione Brodolini, COWI and IER the task to assess changes to administrative/compliance costs within national administrations and for the families affected that would occur from the possible revision of the current EU provisions on export of family benefits specified in Regulation (EC) 883/2004 i: the 'Basic Regulation' and in Regulation (EC) 987/2009 i: the 'Implementing Regulation'.

More precisely, we aim to assess the changes in administrative/compliance tasks, and consequently costs, from having to calculate the amount of exported family benefits based on the living standard in the Member State of residence of the children rather than based on the competent Member State's benefit rates.

Furthermore, we aim to assess whether the families receiving the benefits will face changing administrative/compliance tasks.

We would therefore much appreciate your help by providing us with the list of tasks and estimates of your current administrative/compliance time needs for handling the current EU provisions, and in assessing how these time needs may change from revisions to the provisions. We would like to do this via an interview with you – either in person or by phone.

Hence, we would like to arrange the time and place for an interview; and for you to get more insight into the questions we would like to ask you – we hereby provide you with our interview guide.

You may well find that you are not able to answer all the questions. We will therefore focus on the questions you can answer – but you may also be able to help us pointing to the other services in your national administrations that can help us answering the remaining questions.

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1.

You and your national administration

Name and title of interviewee:

_______________________________________________

National administration:

_______________________________________________

Function/responsibility of interviewee: _______________________________________________

2.

Current administrative tasks and consequently costs of handling exports of family benefits

In this section, we ask you to verify and estimate the costs of a number of administrative tasks that are currently carried out when handling a case of exports of family benefits. Imagine a case as described by the following examples:

Example 1 of exports of family benefits:

Carlos works in Member State A (which has a higher cost of living than Member State B) while his non-working wife Joanna resides with their children in Member State B (which has a lower cost of living than Member State A).

Under the current rules, Carlos is entitled to family benefits in Member State A at the same amount as if his family was residing in Member State A. Example 2 of exports of family benefits:

Carlos works in Member State B while his non-working wife Joanna resides with their children in Member State A.

Under the current rules, Carlos is entitled to family benefits in Member State B at the same amount as if his family was residing in Member State B.

We do the assessment in two parts. Firstly, we ask you to assess a situation when you are the national administration with primary competence – i.e. where you deal with the applicant for family benefits.

Secondly, when you are the national administration with secondary competence – i.e. where you deal with the follow-on administrative tasks from an application submitted in another Member State.

If you only carry out one of the two types of administrative tasks – please leave out the other part.

2.1. Administrative tasks/costs – when national administration with primary competence

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Firstly, please provide your assessment of the number of cases handled by your institution.

 How many cases of exports of family benefits does your institution currently handle per year as the

national administration with primary competence – including new cases and already active cases?

a)

New cases?

b)

Existing active cases?

 How do you collect data?

a)

From other member states?

b)

From the applicant?

When answering these questions please explain whether you collect information via IT-systems, via records of personal registration etc.

Secondly, please provide, with an outset in the below table, your assessment of the current administrative costs of handling a typical case of exports of family benefits, being the national administration with primary competence. (You may relate the tasks to the SEDs to be filled out). Hence:

 Please assess the frequency of each of the detailed administrative tasks – i.e. how often are the tasks carried out for a given case?

And in this context – is it appropriate to distinguish between "standard tasks" and "additional tasks"?

 Please estimate the average man-hours/minutes required per administrative task. We acknowledge that you may not keep accounts of your time spent on a case/task. Hence, we ask you to provide your best guess. Furthermore, we acknowledge that you may find it difficult to provide a specific man-hour estimate per task. Hence, you may instead provide ranges of estimates (less than 15 minutes, 15 to 30 minutes, 30 minutes to 1 hour, between 1 and 3 hours, between 3 hours and 1 working day, more than 1 working day), or you may also choose to provide a total cost estimate per case – and rank the tasks according to their resource demands, where 1 is the most resource demanding tasks and so forth.

Administrative Description of administrative task Average Comments

task - hereunder frequency of tasks within a case man-hours/

minutes

Standard administrative tasks

Determination of Please revise (if necessary): Comments: national

administration You receive an application for exports of family benefits, you determine in which Member State the

with primary

competence applicant and his/her family reside, and determine whether the applicant is employed, unemployed, posted

worker, or civil servant.

Please specify/revise frequency when you are the national administration with primary competence:

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Administrative Description of administrative task Average Comments

task - hereunder frequency of tasks within a case man-hours/

minutes

Calculation of Please revise (if necessary): Comments:

benefit

For each of the cases where you are determined as the national administration with primary competence: You

will calculate the benefits that the applicant is entitled to according to your national legislation. Furthermore, you will contact the Member State of residence of the applicant's family to investigate the applicant's

entitlement to family benefits in this Member State – i.e. to check for overlapping benefits (see further below). Finally, you will set the payment of family benefits in motion.

Please specify/revise frequency when you are the national administration with primary competence:

Frequency, when you are the national administration with primary competence: 100%

Annual control Please revise (if necessary): Comments:

For each of the existing cases of exports of family benefits: You will once a year check whether the information/status on the applicant and his/her family has changed based on the (renewed) application of the

family.

Please specify/revise frequency when you are the

national administration with primary competence:

Frequency, when you are the national administration

with primary competence (i.e. once a year per existing case): 100%

Additional administrative tasks

Disagreement Please revise (if necessary): Comments: regarding

determination of If there is disagreement on whether you or your national corresponding national administration in the other administration Member State is the competent one: Additional with primary tasks/costs arise from exchange of information, from competence determination of which Member State to provide

provisional benefits, and ultimately from bringing the case before the Administrative Commission.

Please specify frequency out of total number of cases when you are the national administration with primary

competence:

Frequency: ___%

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Administrative Description of administrative task Average Comments

task - hereunder frequency of tasks within a case man-hours/

minutes

Overlapping Please revise (if necessary): Comments:

benefits

If the applicant is entitled to family benefits from more than one Member State: Additional costs arise from

determining which Member State legislation to apply, and hence taking provisional decision on competence, and from deciding on possible sharing of benefit payments.

Please specify frequency out of total number of cases when you are the national administration with primary

competence:

Frequency: ___%

Reimbursement Please revise (if necessary): Comments:

If (provisional) family benefits should have been paid by another Member State: Additional costs arise from reimbursement activities.

Please specify frequency out of total number of cases when you are the national administration with primary competence:

Frequency: ___%

Recovery Please revise (if necessary): Comments:

If an applicant unjustified has received family benefits:

Additional costs arise from determining whether there is a basis for recovery, from calculation of benefits to recover, and from contacting Member States with secondary competence to seek recovery.

Please specify frequency out of total number of cases when you are the national administration with primary

competence:

Frequency: ___%

Missing administrative tasks

Please add Comments: missing task

Please estimate your total use of man-hours per case

2.2. Administrative costs – when national administration with secondary competence

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Now, consider the situation, where you are the national administration with secondary competence – i.e. you receive a request for information from the national administration with primary competence in another Member State.

Firstly, please provide your assessment of the number of cases handled by your national administration.

 How many cases of exports of family benefits do institution currently handle per year as the national

administration with secondary competence?

a)

New cases?

b)

Existing active cases?

Secondly, please provide, with an outset in the below table, your assessment of the current administrative costs of handling one case of exports of family benefits, being the national administration with secondary competence. (You may relate the tasks to the SEDs to be filled out). Hence:

 Please assess the frequency of each of the detailed administrative tasks – i.e. how often are the tasks carried out in a typical case of application for family benefits? 100 % means that the task is always carried out, while 50 % means it is carried out in half of the cases.

And in this context – is it appropriate to distinguish between "standard tasks" and "additional tasks"?

Administrative Description of administrative task Average Comments

task - hereunder frequency of tasks within a case man-hours/

minutes

Standard administrative tasks

Determination of Please revise (if necessary): Comments: competent national

administration with You receive an application for family benefits - or a

primary competence notice from another Member State regarding an application for exports of family benefits - and you

contribute to determining the national administration with primary competence.

Please specify/revise frequency when you are the national administration with secondary competence:

Frequency: 100%.

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Administrative Description of administrative task Average Comments

task - hereunder frequency of tasks within a case man-hours/

minutes

Calculation of Please revise (if necessary): Comments: benefit

You will assess the applicant's entitlement to family benefits in your Member State – i.e. you check for overlapping benefits (see further below).

Please specify/revise frequency when you are the national administration with secondary competence:

Frequency: 100%

Annual control Please revise (if necessary): Comments:

For each of the existing cases of exports of family benefits, you will – on request – provide the national

administration with primary competence with information/status on the applicant and his/her family.

Please specify/revise frequency when you are the national administration with secondary competence:

Frequency (i.e. once a year per existing case): 100%

Additional administrative tasks

Disagreement Please revise (if necessary): Comments: regarding

If there is disagreement on whether you or your determination of

national corresponding national administration in the other administration with Member State is the competent one: Additional costs primary competence arise from exchange of information, from determination

of which Member State to provide provisional benefits, and ultimately from bringing the case before the Administrative Commission.

Please specify frequency out of total number of cases when you are the national administration with

secondary competence:

Frequency: ___%

Overlapping Please revise (if necessary): Comments: benefits

If the applicant is entitled to family benefits from more than one Member State: Additional costs arise from determining which Member State legislation to apply, and hence taking provisional decision on competence,

and from deciding on possible sharing of benefit payments.

Please specify frequency out of total number of cases when you are the national administration with secondary competence:

Frequency: ___%

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Administrative Description of administrative task Average Comments

task - hereunder frequency of tasks within a case man-hours/

minutes

Reimbursement Please revise (if necessary): Comments:

If (provisional) family benefits should have been paid by another Member State: Additional costs arise from reimbursement activities.

Please specify frequency out of total number of cases when you are the national administration with secondary competence:

Frequency: ___%

Recovery Please revise (if necessary): Comments:

If an applicant unjustified has received family benefits:

On request, additional costs arise from assisting the national administration with primary competence in recovering unjustified family benefits from the applicant's family.

Please specify frequency out of total number of cases when you are the national administration with

secondary competence:

Frequency: ___%

Missing administrative tasks

Please add missing Comments:

task

Please add missing Comments: task

Please estimate your total use of man-hours per case

3.

Change in administrative costs of handling exports of family benefits from revisions to EU provisions

In this section, we then ask you to assess the likely increase or decrease in administrative task/costs within your national administration from possible revisions to the EU provisions.

We acknowledge that this may be even more difficult than estimating the current use of man-hours in the previous section – in particular if the revisions lead to new administrative tasks.

Please focus on the administrative tasks where resources in terms of average manhours/minutes will change due to the revisions – i.e. if there is no change, please do just enter 0% in the below tables.

Please do this assessment for each of the possible revisions one by one. We firstly ask you to assess the revisions assuming you are the national administration with primary competence, and secondly we ask you to assess the revisions assuming you are the

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Revision (a): Adjustment of amount of exported family benefits to the living standard in the Member State of residence of the child – i.e. adjustment upwards or downwards compared to current situation.

Example 1 of new situation: Carlos works in Member State A while his non-working wife Joanna resides with their children in Member State B. Under the revised rules, Carlos will receive family benefits from Member State A reduced to the living standard in Member State B. Example 2 of new situation: Carlos works in Member State B while his non-working wife Joanna resides with their children in Member State A. Under the revised rules, Carlos will receive family benefits from Member State B increased to the living standard in Member State A.

 Please fill in the table in section 4.1 below.

Revision (b):

Adjustment of amount of exported family benefits to the living standard in the Member State of residence of the

child – limited to the amount provided by the competent Member State.

Example 1 of new situation: Carlos works in Member State A while his non-working wife Joanna resides with their children in Member State B. Under the revised rules, Carlos will receive family benefits from Member State A reduced to the living standard in Member State B. Example 2 of new situation: Carlos works in Member State B while his non-working wife Joanna resides with their children in Member State A. Under the revised rules, Carlos will receive family benefits from Member State B to the maximum of the rate in Member State B, irrespective of the fact that the living Standard in Member State A is higher.

 Please fill in the table in section 4.1 below.

Revision (c):

A further possible option would be that the current order of priority is changed as follows: 1) country of residence of the child; 2) the country of work; and 3) country of pension. This would mean that the country of residence of the child has primary responsibility to pay the full amount of family benefits to which the entitlement exists under its national rules. The country of work would top up this amount if the level of family benefits would be higher there. The family will receive the same amount of family benefits as before, but the

allocation of the costs between the country of work and the country of residence will differ from the current rules. This also applies, where there is no entitlement to family benefits in the primary competent Member State, but there is entitlement in a secondary competent Member State, as in such a case, the latter State will pay 100% of benefits under its national legislation by way of a "top up".

Example 1 of new situation: Carlos works in Member State A (which has a higher cost of living than Member State B) while his non-working wife Joanna resides with their children in Member State B (which has a lower cost of living than Member State A). Under the revised rules, Carlos will receive family benefits from Member State B at the normal national rate to which the entitlement exists under its national rules. If the family is also entitled to benefits from Member State A, the family would receive a EUROPEAN COMMISSION

legislation. The family overall receives the same amount, but Carlos receives less from Member State A than his co-workers whose children reside with them in Member State A. Example 2 of new situation: Carlos works in Member State B (which has a lower cost of living than Member State A) while his non-working wife Joanna resides with their children in Member State A (which has a higher cost of living than Member State B). Under the revised rules, Carlos will receive family benefits from Member State B at the normal national rate to which the entitlement exists under its national rules. As the amount of family benefits paid in Member State B is lower than the amount paid by Member State A, Member State B will pay nothing. The family overall receives the same amount, but Carlos receives less from Member State B than his co-workers whose children reside with them in Member State B.

 Please fill in the table in section 4.1 below.

3.1. Change in administrative tasks – when national administration with primary competence

Consider the situation, where you are the competent national administration – i.e. the national administration sending request for information to (an)other Member State(s).

Please focus on the current administrative tasks where resources in terms of average man-hours/minutes will change due to the revision. Please clearly indicate whether the change is positive or negative: a “+” indicate an increase in the man-hours needed to perform the task and a ”-“ indicate a reduction in man-hours needed to perform the task. If the estimated change is zero or insignificant please also indicate this in the table. Also please add new administrative tasks required by the revision if relevant.

Please provide a brief narrative explanation for each of the assessed changes and new administrative tasks.

Administrative Change in unit cost of administrative tasks due possible revisions of family benefit task provisions

Please provide change in average man-hours or % increase/decrease

Revision (a) Revision (b) Revision (c)

Standard administrative tasks

Determination of Change: Change: Change: national administration

with primary Explanation: Explanation: Explanation:

competence

Calculation of Change: Change: Change: benefit

Explanation: Explanation: Explanation:

Annual control Change: Change: Change:

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Administrative Change in unit cost of administrative tasks due possible revisions of family benefit task provisions

Please provide change in average man-hours or % increase/decrease

Revision (a) Revision (b) Revision (c)

Additional administrative tasks

Disagreement Change: Change: Change: regarding

determination of national Explanation: Explanation: Explanation: administration with primary

competence

Overlapping Change: Change: Change: benefits

Explanation: Explanation: Explanation:

Reimbursement Change: Change: Change:

Explanation: Explanation: Explanation:

Recovery Change: Change: Change:

Explanation: Explanation: Explanation:

Missing (current) administrative tasks [added in the previous section]

Please add Change: Change: Change: missing task

Explanation: Explanation: Explanation:

Please add Change: Change: Change: missing task

Explanation: Explanation: Explanation:

New administrative tasks – due to the revision

Please add new Man-hours: Man-hours: Man-hours: task

Explanation: Explanation: Explanation:

Please add new Man-hours: Man-hours: Man-hours: task

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3.2. Change in administrative costs – when national administration of residence of the family

 Please repeat the assessment of the change in the administrative tasks/costs associated with the case handling for each of the two revisions (a) and (b).

Please focus on the current administrative tasks where resources in terms of average man-hours/minutes will change due to the revision. Please clearly indicate whether the change is positive or negative: a “+” indicate an increase in the man-hours needed to perform the task and a ”-“ indicate a reduction in man-hours needed to perform the task. If the estimated change is zero or insignificant please also indicate this in the table. Also, please add new administrative tasks required by the revision if relevant.

Please provide a brief narrative explanation for each of the assessed changes and new administrative tasks.

Administrative Change in unit cost of administrative tasks due possible revisions of family benefit task provisions

Please provide change in average man-hours or % increase/decrease

Revision (a) Revision (b) Revision (c)

Standard administrative tasks

Determination of Change: Change: Change: national

administration with primary Explanation: Explanation: Explanation: competence

Calculation of Change: Change: Change: benefit

Explanation: Explanation: Explanation:

Annual control Change: Change: Change:

Explanation: Explanation: Explanation:

Additional administrative tasks

Disagreement Change: Change: Change: regarding determination of

national Explanation: Explanation: Explanation:

administration with primary competence

Overlapping Change: Change: Change: benefits

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Administrative Change in unit cost of administrative tasks due possible revisions of family benefit task provisions

Please provide change in average man-hours or % increase/decrease

Revision (a) Revision (b) Revision (c)

Explanation: Explanation: Explanation:

Reimbursement Change: Change: Change:

Explanation: Explanation: Explanation:

Recovery Change: Change: Change:

Explanation: Explanation: Explanation:

Missing (current) administrative tasks [added in the previous section]

Please add missing Change: Change: Change:

task

Explanation: Explanation: Explanation:

Please add missing Change: Change: Change: task

Explanation: Explanation: Explanation:

New administrative tasks – due to the revision

Please add new Man-hours: Man-hours: Man-hours:

task

Explanation: Explanation: Explanation:

Please add new Man-hours: Man-hours: Man-hours: task

Explanation: Explanation: Explanation:

4.

Administrative implications for families from revisions to EU provisions on exports of family benefits

The suggested revisions to the EU provisions on exports of family benefits, and hence changes to the administrative tasks of the national administrations, may also have administrative implications for the families – e.g. time spent when applying for exports of family benefits, when being controlled etc.

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 For each of the revisions we ask you to assess the implications for the families associated hereby.

We acknowledge that it is difficult to assess such implications, but please help us doing this by providing your qualitative (or semi-quantitative) assessments. You may just provide a narrative assessment of the implications or you may try to link the implications to the administrative tasks of the national administrations listed in the below table.

Administrative task Implications for families due possible revisions of family benefit provisions

Please specify the direction of change (and if possible its size: low, medium or high)

Revision (a) Revision (b) Revision (c)

Please add task Man-hours/minutes: Man-hours/minutes: Man-hours/minutes:

Explanation: Explanation: Explanation:

Please add task Man-hours/minutes: Man-hours/minutes: Man-hours/minutes:

Explanation: Explanation: Explanation:

Thanks for your help!

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Annex C – Case study for Germany

Introduction

In this section, we give a short description of the German provisions for family benefits, which kind of benefits they include, who is eligible, and how the provisions are interpreted by the national administrative institution handling family benefits: Die Bundesagentur für Arbeit.

EC Regulation 883/2004 i, Article 1 (z) defines the term family benefits as "all benefits in kind or in cash intended to meet family expenses, excluding advances of maintenance payments and special childbirth and adoption allowances mentioned in Annex I".

In Germany this includes:

-

K indergeld (child benefit)

-

E lterngeld (parental allowance)

-

B etreuungsgeld (child care allowance)

This study considers exportable family benefits (cash benefits) only, and so only Kindergeld.

Kindergeld can be obtained by taxable persons residing in Germany, or persons subject to income taxation in Germany. There are no restrictions with respect to own children, adopted children or dependent children.

To receive Kindergeld, the applicant's children must be under the age of 18. However, there is a possibility for prolongation to 21 years of age for registered jobseekers, and to 25 for students and working students (less than 20 hours a week). Furthermore, the children must reside in Germany or in another EU Member State, the EEA, or in Switzerland.

The German scheme is universal, and so not means-tested. In 2015, the rates were EUR 184 per month for the first and second child, EUR 190 per month for the third child, and EUR 215 per month for the fourth and subsequent children.

Current administrative costs and burden

To determine the current administrative costs and burden in handling exports of family benefits in Germany, a number of face-to-face interviews were carried out with experts from the Nürnberg national administration for family benefits. They estimate that there in Germany as a whole are around 85,000 new cases per year and around 170,000 existing cases handled as primary competence. This is slightly more than the estimates by Pacolet and De Wispelaere (2015) shown in Table C-1.

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Averaging of the experiences of the interviewees of resources spend on administrative tasks as national administration with primary competence leads to an estimate of 1.36 man-hours per case and 1.28 man-hours per case when they act as national administration with secondary competence, c.f. Table C-1 and Table C-2. The tables show also the administrative tasks are fairly similar being of primary and of secondary competence, both with respect to type and to the amount of resources spent. Furthermore, some tasks are always carried out for a given case, while others are much rarer.

Based on the number of man-hours spent and an average labour cost at EUR 20.5 per hour this adds up to a total average of EUR 28.0 per case as national administration with primary competence and EUR 26.2 per case as national administration with secondary competence. Table C-1 and Table C-2 shows that for Germany as a whole – i.e. for all cases during a year – the current administrative costs amount to around mEUR 1.8 and mEUR 0.5, respectively.

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Table C-1 Current administrative costs and burden – Germany as Member State of primary competence

Administrative task Average Frequency Number of Administrative man-hours cases (1) costs, Total,

per case EUR 1,000 (2)

A typical case; first 1.36 hours 100% 62587 1751.4 time handling of a case - all regular tasks included (not annual control)

Determination of 0.5 hours 100% national administration with primary competence 8

Calculation of benefit 0.5 hours 100%

Annual control 9 0.67 hours 100%

Disagreement regarding 2 hours 5% determination of primary competence 10

Overlapping benefits 0 hours 0%

Reimbursement 1 hour 10%

Recovery 1 hour >5%

Translation and 0.25 hours 30-40% coordination

Notes: (1) Source: Pacolet and De Wispelaere (2015). (2) Using unit labour cost estimates based on Eurostat data.

8 The determination of competence and the calculation of benefit is considered as one working task – taking one

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Table C-2 Current administrative costs and burden – Germany as Member State of secondary competence

Administrative task Average Frequency Number of Administrative man-hours cases (1) costs, Total,

per case EUR 1,000 (2)

A typical case; first 1.28 hours 100% 20918 547.8 time handling of a case - all regular tasks included (not annual control)

Determination of 0.5 hours 100% national administration with primary competence 11

Calculation of benefit 0.5 hours 100%

Annual control 1 hour 100%

Disagreement regarding 2 hours 5% determination of primary competence

Overlapping benefits 0 hours 0%

Reimbursement 1 hour 10%

Recovery 1 hour >5%

Notes: (1) Source: Pacolet and De Wispelaere (2015). (2) Using unit labour cost estimates

based on Eurostat data.

Change in administrative costs and burden from revised EU provisions

The overall assessment from the German interviewees is that the changes will lead to few additional man-hours used per case – both being national administration of primary competence and being national administration of secondary competence. Actually, it is assumed that the changes will be similar for the two competences.

Table C-3 shows the expected change in man-hours used per case for Options 1a and 1b – as these are expected to be similar, while Table C-4 concerns Option 3. Options 1a and 1b are extremely complicated to administer as it implies that the national administrations need knowledge on all the different systems, rules and regulations of the different Member States. Technical assistance through a common database. This concerns both the determination of the national administration as well as the calculation of benefits. Furthermore, it is difficult to align different systems like flat-rate systems, income-based systems, the duration of benefit payments etc.

For all three revisions, it has to be added that there are several significant transitional costs that have to be taken into account (training in the new regulations, changes in the IT-systems, re-examination and re-calculation of all existing cases).

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Table C-3 Change in administrative costs and burden from Option 1a and Option 1b – Germany as Member State of primary and secondary competence

Administrative task Change in Frequency Number of Change in average (1) cases administrative man-hours costs, Total, per case EUR 1,000 (2)

A typical case; first 0.9 hours 100% Primary: Primary: time handling of a 62587 1156.9 case - all regular

tasks included (not Secondary: Secondary: annual control) 27794 386.7

Determination of 0.4 hours 100% national administration with primary competence 12

Calculation of benefit 13 0.25 hours 100%

Annual control 0 hours 100%

Disagreement regarding 0 hours 100% determination of national administration with primary competence

Overlapping benefits 0 hours 100%

Reimbursement 14 0.25 hours 100%

Recovery 0 hours 100%

Notes: (1) Source: Pacolet and De Wispelaere (2015). (2) Using unit labour cost estimates

based on Eurostat data.

12 The interviewees have indicated a change of "up to double effort"

13 The interviewees have emphasised that it is not technically feasible at the moment as it is not possible to pay out reduced or higher benefits. They have assessed a change of "++" which we have interpreted as a 50% increase.

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Table C-4 Change in administrative costs and burden from Option 3 – Germany as Member State of primary and secondary competence

A typical case; first Change in Frequency Number of Change in time handling of a average (1) cases administrative case - all regular man-hours costs, Total, tasks included (not per case EUR 1,000 (2) annual control)

Total 0.5 hours 100% Primary: Primary: 642.7

62587 Secondary:

Secondary: 214.8 27794

Determination of 0 hours 100% national administration with primary competence

Calculation of benefit 15 0.25 hours 100%

Annual control 16 0.25 hours 100%

Disagreement regarding 0 hours 100% determination of national administration with primary competence

Overlapping benefits 0 hours 100%

Reimbursement 17 0.25 hours 100%

Recovery 0 hours 100%

Notes: (1) Source: Pacolet and De Wispelaere (2015). (2) Using unit labour cost estimates

based on Eurostat data.

Administrative implications for families from revisions to EU provisions on exports of family benefits

It is the assessment of the national administrations that Options 1a and 1b only will have few administrative implications for the families subject to export of family benefits. However, Option 3 will increase their administrative burden as there will be verifications of the residence of the child. In turn, there may be a reduction in the administrative burden as proof of income will not be necessary anymore.

15 The interviewees have emphasised that it is not technically feasible at the moment as it is not possible to pay our reduced or higher benefits. They have assessed a change of "++" which we have interpreted as a 50% increase.

16 The control costs will increase as the residence of the child will have to be changes. In general, the control of the residence of the child is considered to be difficult to implement. However, as it is no longer necessary to control the existence of an employment contract, administrative costs might also decrease. All in all, the interviewees have assessed a change of "+" which we have interpreted as a 25% increase.

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Conclusions

The annual number of cases handled in Germany per year is estimated at 62587 when Germany is the Member State of primary competence, while the number of cases is somewhat lower, 20918, when Germany is the Member State of secondary competence.

Currently, the administrative resources spent on each case amount to 1.36 hours for an average case when Germany is the Member State primary competence, and to 1.28 hours when of secondary competence.

The overall assessment is that the changes will lead to few additional man-hours used per case – both being national administration of primary competence and being national administration of secondary competence. Actually, it is assumed that the changes will be similar for the two competences.

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Annex D – Case study for Denmark

Introduction

In this section, we give a short description of the Danish legislation on family benefits, which kind of benefits it includes, who is eligible, and how the legislation is interpreted by the national administrative institution handling family benefits, Udbetaling Danmark (Payment Denmark).

In Denmark, this includes 18 :

-

c hildren and youth benefits (børne- og ungeydelsen)

-

c hild supplements and adoption supplements (børnetilskud og adaptionstilskud)

-

s ubsidies for private childcare and subsidies for home caring of own children in
accordance with the Day Care Act chapter 15 and 16 (tilskud til privat pasning og tilskud til pasning af egne børn efter dagtilbudslovens kapitel 15 og 16)

However, since this study only assesses family benefits that can be exported (cash benefits) only the children and youth benefits are relevant.

The law on child benefits (børnetilskudsloven) regulates the children and youth benefits.

Danish children and youth benefits are universal and not means-tested. However, since

2014 it has been income-regulated meaning that workers with a yearly income above

DKK 723,100 (EUR 96,894) receive a reduced amount of benefits.

Family benefits are obtainable for residents with Danish nationality or refugee status and foreigners with one to three years of residence in Denmark, depending on the type of benefits applied for 19 .

According to Danish law two years of residence or employment within a reference period of 10 years is required to obtain the right to family benefits 20 . Are these requirements not met the payments are reduced. Hence, the Danish law establishes that six months of residence or employment in Denmark entitles the applicant to 25% of the full amount of benefit. One year of residence or employment entitles the applicant to 50% of the full amount of benefits. 18 months entitles to 75% and two years of residence or employment entitles to 100% of the benefits 21 . All within a reference period of 10 years.

18 'Vejledning om EF-regler om social sikring – Familieydelser' (The official Danish manual on the interpretation of the EC regulation 883/2004 i in a Danish context).

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For 2015, the rates of benefits are DKK 4,443 (EUR 595) per quarter for each child of 0-2 years, DKK 3,519 (EUR 472) per quarter for each child 3-6 years, DKK 2,769 (EUR 371) per quarter for each child 7-14, and DKK 923 (EUR 124) per quarter for each child of 15- 17 years 22 . The benefits are tax-free and rates are adjusted annually.

In Denmark, Udbetaling Danmark (Payment Denmark) is the national administrative institution handling family benefits. Here, the Department of Family Benefits (afdeling for familieydelser) is responsible for all processes and payments related to family benefits. Therefore, in determining the Danish national administrative burdens related to handling exports of family benefits only one interview was conducted.

Udbetaling Danmark acknowledged that the Danish legislation at first glance might seem to be inconsistent with EC Regulation 883/2004 i. However, they stressed that in practice the rules are in line with EU regulation since Udbetaling Danmark calculate an EU- workers' right to benefits based on an aggregation principle, where the period of time, in which the EU-worker was entitled to benefits from the Member State(s) where he/she previously resided, is included. If the Member State(s), in which an EU-worker formerly resided, has assessed there is a right to benefits, this right also applies in Denmark. In many EU Member States, the right to family benefits derives from work or insurance, where i n Denmark it is based on residence.

Current administrative costs and burden

To determine the current administrative costs and burden in handling family benefits in Denmark an interview with Udbetaling Danmark, Department of Family Benefits, was conducted. Udbetaling Danmark has been doing measurements of time used on internal handling of different types of cases and was therefore able to give rather accurate time estimates on the different tasks. Udbetaling Danmark has only existed for two years. Prior to this family benefits were managed by the Danish municipalities.

Udbetaling Danmark estimates that they handle approximately 6,500 new cases a year (about 450 cases per month). It is estimated that in 20% – or 1,300 – of these cases Udbetaling Danmark is the national administration of secondary competence. Udbetaling Danmark currently has 10,000 ongoing cases where quarterly payments are made. Udbetaling Danmark states that the number of cases has been stable – though with a slight increase – in the two years Udbetaling Danmark has existed. The amount of new cases typically follows the different types of seasonal work (e.g. horticulture work) and bigger projects (e.g. construction projects such as the new city metro line in Copenhagen). A slight increase in the number of cases in the coming years is expected due to the economic situation in Denmark, which remains better than many other European countries. However, there is a tendency towards more EU-workers moving their families to Denmark after having worked here for a period of time, in which case the family benefits cease being exported.

It is the impression at Udbetaling Danmark that Denmark, due to its high amount of benefits, in most cases is the primary competent state (at times jointly with another Member State).

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The average man-hours used handling cases on export of family benefits by Udbetaling Danmark as national administration with primary competence is estimated at 3.70 manhours per case. As national administration with secondary competence the number is 3.88 man-hours per case. With an average labour cost at EUR 29.3 per hour this adds up to a total average of EUR 108.5 per case as national administration with primary competence and EUR 113.6 per case as national administration with secondary competence. Hence, for Denmark as a whole the annual current administrative costs amount to EUR 564,000 and EUR 83,100, respectively.

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Table D-1 Current administrative costs and burden – Denmark as Member State of primary competence

Administrative task Average Frequency Number of Administrative man-hours (1) cases costs, Total,

per case EUR 1,000 (2)

A typical case; first 3.70 hours 100% 5200 564.0 time handling of a case - all regular tasks included (not annual control)

Determination of 1 hour 100% national administration with primary competence 23

Calculation of benefit 24 1.83 hours 100%

Annual control 0.75 hours 80%

Disagreement regarding 2.50 hours 0-5% determination of primary competence

Overlapping benefits 25 0.50 hours 90-100%

Reimbursement 26 12 hours 2%

Recovery 27 0.50 min. 0.25-0.5%

Notes: (1) Source: Estimate provided by the Danish national expert. (2) Using unit labour

cost estimates based on Eurostat data.

23 The EU worker does not submit an actual application; he/she just provide the requested information to Udbetaling Danmark (or another MS) who then initiates the process. Exchange of information with other relevant Member State already takes place on receipt of application/information on EU worker. Other relevant Member State provides (amongst other things) information on the family status.

24 Information and answers obtained before any calculation of benefits are made. Point should therefore be noted under 'determination of national administration with primary competence', where it is also included in the estimation of man-hours.

25 There is usually overlap in entitlement why it should not be listed as a separate task, but should be located under 'determination of national administration with primary competence'. In Denmark, the right to benefits is conditioned by Danish residency, but in many other MS the right to benefits often derives from work or insurance. This creates an overlap in entitlement to benefits. Often an overlap in benefits occurs when the applicant moves between DK and another MS, as DK typically pre-pay, while other countries post pay.

26 Very few cases after the new regulation. Today it is no longer possible to pay benefits to an applicant who is eligible in another MS, and then seek reimbursement from the other MS. Instead, the requirement today is to bypass the other MS and approach the applicant directly (which transfers most of the cases to the 'recovery' category). Reimbursement is only relevant in cases where there are three member states involved. For example, when the mother works in Denmark, and applies for family benefits here, the father works in Sweden, and applies for benefits there, while the family (children) lives in Norway. In this case

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Table D-2 Current administrative costs and burden – Denmark as Member State of secondary competence

Administrative task Average Frequency Number of Administrative man-hours (1) cases costs, Total,

per case EUR 1,000 (2)

A typical case; first 3.88 hours 100% 732 83.1 time handling of a case - all regular tasks included (not annual control)

Determination of 1 hour 100% national administration with primary competence 28

Calculation of benefit 29 1.83 hours 100%

Annual control 30 0.25 hours 20%

Annual recalculation of 0.17 hours 100% benefits as secondary

MS 31

Disagreement regarding 2.5 hours 0-5% determination of primary competence

Overlapping benefits 32 0.5 hours 90-100%

Reimbursement 33 12 hours 2%

Recovery 34 2 hours 0.25-0.5%

Notes: (1) Source: Pacolet and De Wispelaere (2015). (2) Using unit labour cost estimates based on Eurostat data.

28 The EU worker does not submit an actual application; he/she just provide the requested information to Udbetaling Danmark (or another MS) who then initiates the process. Exchange of information with other relevant Member State already takes place on receipt of application/information on EU worker. Other relevant Member State provides (amongst other things) information on the family status.

29 Information and answers obtained before any calculation of benefits are made. Point should therefore be noted under 'determination of national administration with primary competence', where it is also included in the estimation of man hours.

30 When secondary state, less control is needed.

31 The annual recalculation of benefits as secondary institution is relevant to Member States that have high family benefits. Udbetaling Danmark estimate that this goes for about one third of the MS. Eastern and southern Europe generally have very low benefits. Only Sweden (when the children are older), Netherlands and (some parts of) Germany have higher benefits than Denmark.

32 There is usually overlap in entitlement why it should not be listed as a separate task, but should be located under 'determination of national administration with primary competence'. In Denmark, the right to benefits is conditioned by Danish residency, but in many other MS it is often conditioned by work. This creates an overlap in entitlement to benefits. There is often also an overlap when the applicant moves between DK and another MS, as DK typically pre-pay, while other countries post pay.

33 Very few cases after the new regulation. Today it is no longer possible to pay benefits to an applicant who is eligible in another MS, and then seek reimbursement from the other MS. Instead, the requirement today is to bypass the other MS and approach the applicant directly (which transfers most of the cases to the 'recovery' category). Reimbursement is only relevant in cases where there are three member states involved. For example, when the mother works in Denmark, and applies for family benefits here, the father works in Sweden, and applies for benefits there, while the family (children) lives in Norway. In this case both Denmark and Sweden are the competent administration why either Denmark or Sweden pays benefits to the family and afterwards seek reimbursement from the other MS.

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Change in administrative costs and burden from revised EU provisions

Table D-3 and Table D-4 reveal that the Udbetaling Denmark envisages that the analysed revisions to the EU provisions will have fairly similar impacts on the administrative costs – whether being the Member State of primary competence or of secondary competence. Furthermore, Option 1a and Option 1b are expected to have similar impacts, while the impacts of Option 3 are slightly lower. The main impact is expected to be on the resources spend on the calculation of benefits, while the rare reimbursement cases are expected to be even more complex.

Table D-3 Change in administrative costs and burden from Option 1a and Option 1b – Denmark as Member State of primary and secondary competence

A typical case; first Change in Frequency Number of Change in time handling of a average cases (1) administrative case - all regular man-hours costs, Total, tasks included (not per case EUR 1,000 (2) annual control)

Total 1.99 hours 100% Primary: Primary: 303.3 5200 Secondary:

Secondary: 42.7 732

Determination of 0.25 hours 100% national administration with primary competence 35

Calculation of benefit 36 1.5 hours 100%

Annual control 37 0.5 hours 100%

Disagreement regarding 0 hours 0-5% determination of national administration with primary competence

Overlapping benefits 0 hours 90-100%

Reimbursement 12 hours 2%

Recovery 0 hours 0.25-0.5%

Notes: (1) Source: Estimate provided by the Danish national expert, and Pacolet and De Wispelaere (2015). (2) Using unit labour cost estimates based on Eurostat data.

35 To some extend it will be the same as the current situation. However, it will probably be necessary to gather information more often, on whether the EU workers entitlement to benefit in the other MS has changed.

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Table D-4 Change in administrative costs and burden from Option 3 – Denmark as

Member State of primary and secondary competence

A typical case; first time Change in Frequency Number of Change in handling of a case - all average cases (1) administrati regular tasks included man-hours ve costs, (not annual control) per case Total, EUR

1,000 (2)

Total Primary: 1.99 100% Primary: Primary:

Secondary: 100% 5200 303.3

1.79 Secondary: Secondary: 732 37.4

Determination of national 0.25 hours 100% administration with primary competence

Calculation of benefit 1.5 hours 100%

Annual control 0.25 hours Primary: 20%

Secondary: 80%

(Opposite before

revision)

Disagreement regarding 0 hours 0-5% determination of national administration with primary competence

Overlapping benefits 0 hours 90-100%

Reimbursement 12 hours 2%

Recovery 0 hours 0.25-0.5%

Notes: (1) Source: Estimate provided by the Danish national expert, and Pacolet and De

Wispelaere (2015). (2) Using unit labour cost estimates based on Eurostat data.

Administrative implications for families from revisions to EU provisions on exports of family benefits

The proposal, which entails that benefits are adjusted to the standard of living in the

Member State of residence, will most likely provide longer case processing times for the

EU-workers and their families, due to the increase in information that needs to be obtained/exchanged.

Many of the changes involve, that the EU-workers need to be in contact with an additional authority (both the primary and the secondary) since they will have the right to benefits from more than one Member State.

In cases where EU workers need to provide proof of residence to obtain benefits the revisions might make it more difficult for them. In Denmark, this would not be an issue,

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Option 1a: Unchanged time used for the EU worker. EU workers must do the same as today, but will probably experience a prolonged processing time, since they in all cases must wait for information from the other Member State.

Option 1b: The same as Option 1a. Unchanged time used, but extended processing time for certain cases.

Option 3: Maybe less time consuming and experience of an easier procedure for the EU worker, since they must apply in the country where the family resides which can be assumed to have a system the EU worker will find easier to navigate in.

Conclusions

The annual number of cases handled in Denmark per year is estimated at 5200 when Denmark is the Member State of primary competence, while the number of cases is somewhat lower, 732, when Denmark is the Member State of secondary competence.

Currently, the administrative resources spent on each case amount to 3.70 hours for an average case when Denmark is the Member State primary competence, and to 3.88 hours when of secondary competence.

The overall assessment is that the changes will lead to around 2 additional man-hours used per case when being national administration of primary competence and around 1.8 additional hours being national administration of secondary competence.

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Annex E – Case study for Netherlands

Introduction

In this section, we give a short description of Dutch the legislation on family benefits, which kind of benefits it includes, who is eligible, and how the legislation is interpreted by the national administrative institution handling family benefits, Sociale Verzekeringsbank (SVB).

In The Netherlands, this includes:

-

A lgemene Kinderbijslagwet (AKW) (General Child Benefit)

-

W et op het kindgebonden budget (WKB) (Act on supplementary child benefit)

This study only assess exportable family benefits (cash benefits), which applies to both

AKW and WKB. Both kinds of benefits are granted to EU workers with children residing in another EU Member State (EEA country or Switzerland).

To receive family benefits in the Netherlands the applicant's children must be under the age of 18. In addition, the applicant must – regardless of nationality – reside, work and consequently pay taxes on wages in the Netherlands to be eligible to family benefits. While the Algemene Kinderbijslagwet (AKW) is universal scheme and not mean-tested, the Wet op het kindgebonden budget (WKB) is means-tested.

In 2015 the AKW rates for children up to 5 years are EUR 63.88, for children in the age of

6-11 years: EUR 77.57, and for children in the age of 12-17 years: EUR 91.26. The benefits are paid per quarter.

For the WKB there is a ceiling depending on income. The benefit amount decreases as income rise: For income above the threshold of EUR 26,147 the allowance is reduced by 7.6% of the difference between the family income and the EUR 26,147. The income limit for a single person is EUR 102,499 and EUR 123,638 for partners. The monthly amount per children is for one child: EUR 39,529; for two children: EUR 46,581, for three children: EUR 48,989, for four children: EUR 50,384; (...) and for eight children: EUR 55,963.

Current administrative costs and burden

To determine the current administrative costs and burdens in handling family benefits in

The Netherlands an interview with Sociale Verzekeringsbank (SVB), Directie Strategische en Externe Betrekkingen ( Social Security Office, Department of Strategic and External Relations ), was conducted.

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SVB estimates that they handle approximately 4,800 new cases each year 38 and about 15,600 existing cases 39 . The numbers from the HIVA study (Pacolet and De Wispelaere, 2015) for 2013 are 20,225 existing cases as national institution of primary competence and 7,596 cases as national institution of secondary competence. The calculations of administrative costs in handling family benefits are based on the data received from the HIVA study.

The present study estimates the number of man-hours spend as national administration with primary competence is 1.92 man-hours and 1.47 man-hours as national administration with secondary competence.

Based on the number of man-hours spend from this study and an average labour cost at EUR 22.2 per hour this adds up to a total average of EUR 42.7 per case as national administration with primary competence and EUR 32.7 per case as national administration with secondary competence. Hence, for the Netherlands as a whole the annual current administrative costs amount to EUR 862,700 and EUR 247,200, respectively

Below is a detailed review of the administrative cost (EUR) arising from each of the administrative tasks involved in handling the export of family benefits today and in regards to Options 1a, 1b and 3.

38 Based on the number of new cases in the period from October to December 2013.

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Table E-1 Current administrative costs and burden – the Netherlands as Member State of primary competence

Administrative task Average Frequency Number of Administrative man-hours (1) cases costs, Total,

per case EUR 1,000 (2)

A typical case; first 1.92 hours 100% 20225 862.7 time handling of a case - all regular tasks included (not annual control)

Determination of 0.5 hours 150% national administration with primary competence. 40

Calculation of benefit 0.75 hours 100%

Annual control 41 0.38 hours 50%

Disagreement regarding 0.50 hours 100% determination of primary competence 42

Overlapping benefits 43 0 hours 100%

Reimbursement 44 1 hour 0-5%

Recovery 45 1 hour 0-5%

Notes: (1) Source: Pacolet and De Wispelaere (2015). (2) Using unit labour cost estimates

based on Eurostat data.

40 This task is done both during an intake and during mutation. Often there are one or more mutations during a year, why the task in average is done 1,5 times per year.

41 Annual control is only done in about 50 pct. of the cases and often depend on which the country.

42 Very few cases with disagreements on competence. Almost never happens.

43 These task falls under the 'calculation of benefits'.

44 Frequency per case is very hard to estimate. For both reimbursement and recovery, the tasks that the SVB has to do are the same. The SVB first tries to recover the money from the applicant, and only when that fails, do they contact the relevant institution in another Member State. Both for reimbursement and recovery the SVB uses the term 'Verrekening', which means 'solving miscalculation'.

45 Frequency per case is very hard to estimate. For both reimbursement and recovery, the tasks that the SVB

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Table E-2 Current administrative costs and burden – the Netherlands as Member State of secondary competence

Administrative task Average Frequency Number of Administrative man-hours (1) cases costs, Total,

per case EUR 1,000 (2)

A typical case; first 1.47 hours 100% 7569 247.2 time handling of a case - all regular tasks included (not annual control)

Determination of 0.38 hours 150% national administration with primary competence 46

Calculation of benefit 47 0.75 hours 100%

Annual control 0.38 hours 100%

Disagreement regarding 1 hour 0-5% determination of primary competence 48

Overlapping benefits 49 0 hours 100%

Reimbursement 50 1 hour 0-5%

Recovery 51 1 hour 0-5%

Notes: (1) Source: Pacolet and De Wispelaere (2015). (2) Using unit labour cost estimates

based on Eurostat data.

Change in administrative costs and burden from revised EU provisions

The overall assessment from the SVB is, that the changes will lead to few additional man-hours used per case. However, the SVB stresses that the introduction of such changes most likely will be followed by a transition phase (6-12 months) involving a significant amount of policy changes, update of processes and instructions, change of IT- systems and new agreements with relevant partners (e.g. tax department).

Below is shown the expected change in man-hours used per case which for all three revisions is estimated to a total average of 1.13 hours per case both as primary and secondary national administration. With an average labour cost at EUR 22.2 per hour this adds up to a total average of additional EUR 25 per case.

46 This task is done both during an intake and during mutation. Often there are one or more mutations during a year, why the task in average is done 1.5 times per year.

47 Due to the need for additional contact to national administrations in other Member States and contact to the national tax department, this task is in average performed four times a year for active cases.

48 Very few cases with disagreements on competence. Almost never happens.

49 These task falls under the 'calculation of benefits'.

50 Frequency per case is very hard to estimate. For both reimbursement and recovery, the tasks that the SVB has to do are the same. The SVB first tries to recover the money from the applicant, and only when that fails, do they contact the relevant institution in another Member State. Both for reimbursement and recovery the SVB uses the term 'Verrekening', which means 'solving miscalculation'.

51 Frequency per case is very hard to estimate. For both reimbursement and recovery, the tasks that the SVB

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Table E-3 Change in administrative costs and burden from Options 1a, 1b and 3 – the Netherlands as Member State of primary and secondary competence

Administrative task Change in Frequency Number of Change in average (1) cases administrative man-hours costs, Total, per case EUR 1,000 (2)

A typical case; first 1.13 hours 100% 27794 694.7 time handling of a case - all regular tasks included (not annual control)

Determination of 0 hours 100% national administration with primary competence 52

Calculation of benefit 53 1.13 hours 100%

Annual control 54 0 hours 100%

Disagreement regarding 0 hours 100% determination of national administration with primary competence 55

Overlapping benefits 56 0 hours 100%

Reimbursement 57 0 hours 100%

Recovery 58 0 hours 100%

Notes: (1) Source: Pacolet and De Wispelaere (2015). (2) Using unit labour cost estimates based on Eurostat data.

52 Rules do not actually change.

53 Option 1a: Additional 50% since living standards has to be taken into account. Option 1b: Additional 50% since living standards has to be taken into account and gathering of additional information from other Member States needs to be done.

54 Rules do not actually change.

55 Rules do not actually change.

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Administrative implications for families from revisions to EU provisions on exports of family benefits

It is the SVB assessment that the changes will not lead to extra tasks for the applicants. However, they stress that the process of handling the applications most likely will take more time why the applicant consequently must wait longer to get the application approved.

Conclusions

The annual number of cases handled in the Netherlands per year is estimated at 20225 when the Netherlands is the Member State of primary competence, while the number of cases is somewhat lower, 7569, when being the Member State of secondary competence.

Currently, the administrative resources spent on each case amount to 1.92 hours for an average case when the Netherlands is the Member State primary competence, and to 1.47 hours when of secondary competence.

The overall assessment is that the changes due to any of the three revisions will lead to just above around 1 additional man-hour used per case – whether being national administration of primary competence or of secondary competence.

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Annex F – Case study for Poland

Introduction

In this section, we give a short description of the Polish legislation on family benefits, which kind of benefits it includes, who is eligible, and how the legislation is interpreted by the administrative institutions handling family benefits. The institutions responsible for handling family benefits in Poland are at the national level the Ministry of Labour and Social Policy and at regional level the Regional Social Policy Centres, more precisely the Regional Social Policy Centre Krakow and the Regional Social Policy Centre Opole.

To be eligible to family benefits in Poland the beneficiaries must be either:

-

P olish citizen

-

F oreigner who falls within the scope of the law on coordination of social security
schemes or bilateral agreement on social security

-

F oreigners residing with their family within the territory of Poland who holds
refugee status or has residence permit. Applicants who holds an EU, EEA or Swiss citizenship are not obliged to have their children living in Poland to be eligible to family benefits.

Polish family benefits are contributory and means-tested. It is given to children under the age of 18 years or at the end of the child’s education at school. The family income per capita must not exceed PLN 539 (EUR 130) (in 2014) per month (PLN 623 (EUR 150) in the case of families with a disabled child). The monthly amounts per child depend on the age: under 5 years: PLN 77 (EUR 18), 5 - 18 years: PLN 106 (EUR 25), 18 - 24 years: PLN 115 (EUR 28).

Current administrative costs and burden

To determine the current administrative costs and burden in handling family benefits in

Poland interviews with the relevant Polish administrative institutions have been conducted. This includes: at the national level the Ministry of Labour and Social Policy, Department of Coordination of Social Security Systems, and at regional level the Regional Social Policy Centres, more precisely the Regional Social Policy Centre Krakow and the Regional Social Policy Centre Opole.

The Ministry of Labour and Social Policy estimates, that they in average handled 78,000 cases of family benefits in 2014 and a total of around 6,000 active cases 59 . The ministry underlined that they did not have any data on man-hours used on handling cases of family benefits. Their given estimates of man-hours used are based on intuition.

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Below is a detailed review of the administrative costs arising from each of the administrative tasks involved in handling the export of family benefits today and in regards to Options 1a, 1b and 3.

Table F-1 shows that an average case for the national administration as primary competence uses just above one man-hour with most time most often spent on the calculation of benefit and on determining which Member State actually has the primary competence. In addition, the Polish interviewees mention the copying of the application and its transfer to a foreign institution as a standard task.

Table F-1 Current administrative costs and burden – Poland as Member State of primary competence

Administrative task Average Frequency Number of Administrative man-hours cases (1) costs, Total,

per case EUR 1,000 (2)

A typical case; first 1.21 hours 100% 8698 53.9 time handling of a case - all regular tasks included (not annual control)

Determination of 0.44 hours 100% national administration with primary competence

Calculation of benefit 60 0.47 hours 100%

Annual control 61 0.06 hours 0-1%

Disagreement regarding 0.75 hours 0.04-1% determination of primary competence 62

Overlapping benefits 63 0 hours 100%

Reimbursement 0 hours 10%

Recovery 0.33 hours 10%

Additional task 64 0.21 hours 100%

Notes: (1) Source: Pacolet and De Wispelaere (2015). (2) Using unit labour cost estimates based on Eurostat data.

60 In Poland the amount of family benefit is - to a large extend - fixed.

61 The Ministry of Labour and Social Policy notes, that in Poland a new application has to be submitted every year, why annual control - in principle - is not relevant. However, in some cases they still have an annual inspection. It takes around 10 min. to submitting a new application.

62 Time used on this task usually derives from challenges on gathering information from other Member States.

EUROPEAN COMMISSION

Table F-2 shows that a similar amount of resources are spent on an average case being the national administration of secondary competence. The largest task is here the determination of which Member State that actually has the primary competence.

Table F-2 Current administrative costs and burden – Poland as Member State of secondary competence

Administrative task Average Frequency Number of Administrative man-hours cases (1) costs, Total,

per case EUR 1,000 (2)

A typical case; first 1.14 hours 100% 62047 362.9 time handling of a case - all regular tasks included (not annual control)

Determination of 0.69 hours 100% national administration with primary competence

Calculation of benefit 0.17 hours 100%

Annual control 0 hours 0%

Disagreement regarding 0.50 hours 0-0.04% determination of primary competence

Overlapping benefits 0.17 hours 100%

Reimbursement 0 hours 10%

Recovery 0.11 hours 10%

Notes: (1) Source: Pacolet and De Wispelaere (2015). (2) Using unit labour cost estimates

based on Eurostat data.

Change in administrative costs and burden from revised EU provisions

The interviewees were also asked to assess the consequences of three different revisions to the current EU provisions. The consequences are estimated in terms of additional man-hours to carry out the administrative tasks.

Table F-3 shows that Option 1a is expected to lead to additional resource requirements of just under half an hour – a little less being of secondary competence than of primary competence. These amounts are composed of minor additional efforts to calculate benefits, to deal with overlapping benefits

EUROPEAN COMMISSION

Table F-3 Change in administrative costs and burden from Option 1a – Poland as Member State of primary and secondary competence

Administrative Change in Frequency Number of Change in task average mancases (1) administrative

hours per case costs, Total, EUR 1,000 (2)

A typical case; Primary: 0.43 Primary: Primary: Primary: 19.0 first time handling hours 100% 8698

of a case - all Secondary: regular tasks Secondary: Secondary: Secondary: 103.6 included (not 0.33 hours 100% 62047

annual control)

Determination of Primary: 0 100% national hours administration with

primary competence Secondary: 0 hours

Calculation of Primary: 0.15 100% benefit hours

Secondary: 0.10 hours

Annual control Primary: 0 Primary: 0- hours 1%

Secondary: - Secondary: 0.05 hours 0%

Disagreement Primary: 0 Primary: regarding hours 0.04-1% determination of

national Secondary: - Second.: 0- administration with 0.05 hours 0.04%

primary competence

Overlapping benefits Primary: 0.08 100% hours

Secondary: 0.08 hours

Reimbursement Primary: 0.08 10% hours

Secondary: 0.08 hours

Recovery Primary: 0.13 10% hours

Secondary: 0.13 hours

Notes: (1) Source: Pacolet and De Wispelaere (2015). (2) Using unit labour cost estimates based on Eurostat data.

EUROPEAN COMMISSION

The picture is as shown in Table F-4 similar of Option 1b when Poland is the Member State of primary competence, while resource requirements are expected to fall slightly when being of secondary competence. This is mainly due to a fall in the task of calculating benefits.

EUROPEAN COMMISSION

Table F-4 Change in administrative costs and burden from Option 1b – Poland as Member State of primary and secondary competence

Administrative Change in Frequency Number of Change in task average mancases (1) administrative

hours per case costs, Total, EUR 1,000 (2)

A typical case; Primary: 0.38 Primary: Primary: Primary: 16.7 first time handling hours 100% 8698

of a case - all Secondary: - regular tasks Second.: -0.13 Secondary: Secondary: 39.8 included (not hours 100% 62047

annual control)

Determination of Primary: 0 100% national hours administration with

primary competence Secondary: 0 hours

Calculation of Primary: 0.15 100% benefit hours

Secondary: - 0.15 hours

Annual control Primary: 0 Primary: 0- hours 1%

Secondary: - Secondary: 0.50 hours 0%

Disagreement Primary: 0 Primary: regarding hours 0.04-1% determination of

national Secondary: - Second.: 0- administration with 0.05 hours 0.04%

primary competence

Overlapping benefits Primary: 0 100% hours

Secondary: 0 hours

Reimbursement Primary: 0.08 10% hours

Secondary: 0.08 hours

Recovery Primary: 0.08 10% hours

Secondary: 0.13 hours

Notes: (1) Source: Pacolet and De Wispelaere (2015). (2) Using unit labour cost estimates based on Eurostat data.

EUROPEAN COMMISSION

Finally, Table F-5 shows that only few changes to the administrative tasks are expected from Option 3.

EUROPEAN COMMISSION

Table F-5 Change in administrative costs and burden from Option 3 – Poland as

Member State of primary and secondary competence

Administrative Change in Frequency Number of Change in task average mancases (1) administrati

hours per case ve costs, Total, EUR 1,000 (2)

A typical case; first Primary: 0.13 Primary: Primary: Primary: 5.6 time handling of a hours 100% 8698

case - all regular Secondary: tasks included Secondary: 0.13 Secondary: Secondary: 39.8 (not annual hours 100% 62047

control)

Determination of Primary: 0 hours 100% national

administration with Secondary: 0.10 primary competence hours

Calculation of benefit Primary: 0.10 hours 100%

Secondary: 0.10 hours

Annual control Primary: 0 hours Primary: 0-

Secondary: -0.50 1%

hours Secondary: 0%

Disagreement Primary: 0 hours Primary: regarding 0.04-1%

determination of Secondary: -0.05 national hours Second.: 0- administration with 0.04%

primary competence

Overlapping benefits Primary: 0.03 hours 100%

Secondary: 0.08 hours

Reimbursement Primary: 0.03 hours 10%

Secondary: -0.05 hours

Recovery Primary: 0.08 hours 10%

Secondary: -0.05 hours

Notes: (1) Source: Pacolet and De Wispelaere (2015). (2) Using unit labour cost estimates based on Eurostat data.

EUROPEAN COMMISSION

Administrative implications for families from revisions to EU provisions on exports of family benefits

The Regional Social Policy Centre in Opole assesses that the revisions will not lead to any direct changes to the application procedure; neither in the time used nor in the administrative tasks to be performed. However, the Department for Coordination of Social Security Systems and the Ministry of Labour and Social Policy notes that their assessment of the implications to the applicants due to the revisions are high.

Conclusions

The annual number of cases handled in Poland per year is estimated at 8698 when Poland is the Member State of primary competence, while the number of cases is somewhat higher, 62047, when being the Member State of secondary competence.

Currently, the administrative resources spent on each case amount to 1.21 hours for an average case when Poland is the Member State primary competence, and to 1.14 hours when of secondary competence.

The overall assessment is that the changes due to any of the three revisions will lead to less than half an hour additional resource per case – whether being national administration of primary competence or of secondary competence.

EUROPEAN COMMISSION

Annex G – Case study for Romania

Introduction

In this section, we give a short description of Romanian legislation on family benefits, which kind of benefits it includes, who is eligible, and how the legislation is interpreted by the national administrative institution handling family benefits, National Agency for Payments and Social Inspection.

The National Agency for Payments and Social Inspection is a public institution with legal personality, subordinated to the Ministry of Labour, Family and Social Protection. The agency operates through county agencies for payments and social inspection, who are organized and operating as decentralised public services with legal personality. While the National Agency for Payments and Social Inspection is the liaison body for family benefits in Romania, the county agencies are the competent institutions.

In Romania, this includes:

• child benefits • child-raising benefits

However, since this study assesses family benefits that can be exported (cash benefits) only the child benefits are relevant.

Children up to 18 years of age (or secondary or post-secondary graduation age), who live together with their parents, and have their domicile or residence in Romania, are entitled to state allowances for children (alocaţie de stat pentru copii). The amount of child benefits is fixed (not income related), but varies according to age: 200 lei (EUR 45) for children under the age of two and to 42 lei (about EUR 9) for those older than two.

Claims for family benefits have to be submitted at the town halls. Claims that involve the use of EU forms are submitted to the county agencies for payments and social inspection who take the decision on entitlement.

Eligibility to family benefits requires documentation in the form of: original and copy of birth certificate of the child, original and copy of the ID of the legal representative, documents showing legal status of the child towards legal representative. In cases where claims for child benefits are made by EU citizens working in Romania, the applicant must provide documentation to clarify whether Romania has primary competence. This includes relevant information regarding working status and residence of the other parent and child(ren).

The National Agency for Payments and Social Inspection is using an IT tool for issuing the decisions and calculation of benefits in the case of national applications. This is not applicable for issuing the EU for ms.

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Current administrative costs and burden

To determine the current administrative costs and burdens in handling family benefits in Romania an interview with the National Agency for Payments and Social Inspection was conducted.

The National Agency for Payments and Social Inspection estimates that they handle approximately 3,000 existing active cases as primary competent state and 49,536 65 existing cases as secondary competent state.

The average man-hours used handling cases on export of family benefits by National Agency for Payments and Social Inspection as national administration with primary competence is 1.46 man-hours. As national administration with secondary competence the number is 0.37 man-hours. With an average labour cost at EUR 2.5 per hour this adds up to a total average of EUR 3.7 per case as national administration with primary competence and EUR 0.9 per case as national administration with secondary competence.

Below is a detailed review of the administrative costs arising from each of the administrative tasks involved in handling the export of family benefits today and in regards to Options 1a, 1b, and 3.

EUROPEAN COMMISSION

Table G-1 Current administrative costs and burden – Romania as Member State of primary competence

Administrative task Average Frequency Number of Administrative man-hours cases (1) costs, Total,

per case EUR 1,000 (2)

A typical case; first 1.46 hours 100% 11427 42.3 time handling of a case - all regular tasks included (not annual control)

Determination of 1 hour 100% national administration with primary competence

Calculation of benefit 2 hours 10%

Annual control 1 hour 10%

Disagreement regarding 1 hour 0.01% determination of primary competence 66

Overlapping benefits 67 1.5 hours. 5%

Reimbursement 1 hour 0.1%

Recovery 68 2 hours 0.05%

Notes: (1) Source: Pacolet and De Wispelaere (2015). (2) Using unit labour cost estimates

based on Eurostat data.

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Table G-2 Current administrative costs and burden – Romania as Member State of secondary competence

Administrative task Average Frequency Number of Administrative man-hours cases (1) costs, Total,

per case EUR 1,000 (2)

A typical case; first 0.37 hours 100% 4616 4.3 time handling of a case - all regular tasks included (not annual control)

Determination of 35 min. 20% national administration with primary competence

Calculation of benefit 1 hour 20%

Annual control 1 hour 100%

Disagreement regarding 1 hour 5% determination of primary competence

Overlapping benefits 1.5 hours 0.1%

Reimbursement - 0%

Recovery 2 hours 0.1%

Notes: (1) Source: Pacolet and De Wispelaere (2015). (2) Using unit labour cost estimates

based on Eurostat data.

Change in administrative costs and burden from revised EU provisions

The National Agency for Payments and Social Inspection expressed doubts regarding the proposed changes to the provisions of family benefits granted according to the living standard in the Member State of residence of the child. The concerns were related to whether the revisions would lead to a breach with the principles of coordination of social security systems.

In addition, the National Agency for Payments and Social Inspection stressed, that since the procedure of implementing the new rules are not clear, they found it rather difficult to make an estimation of the change in administrative costs.

If the procedures are implemented through the same mechanism of EU forms and payments of benefits are made directly to the families, the administrative costs will remain almost the same. However, if the procedure shall involve reimbursements between the institutions, the administrative tasks will increase and the costs equally which most likely will affect the EU workers/applicants. The National Agency for Payments and Social Inspections also assessed, that in case the order of priority changed so that the country of residence of the children becomes the Member State with primary competence, it will lead to an increase in disagreements between the Member State on competence, since residence as a criteria is harder to implement than work.

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Table G-3 Change in administrative costs and burden from Option 1a and Option 1b –

Romania as Member State of primary and secondary competence

Administrative task Change in Frequency Number of Change in average mancases (1) administrati hours per case ve costs, Total, EUR 1,000 (2)

A typical case; first Primary: 0.30 100% Primary: Primary: 8.7 time handling of a hours

case - all regular 100%

11427 Secondary:

tasks included (not Secondary: 0.55 Secondary: 6.4 annual control) hours 4616

Determination of 0 hours Primary: national 100% administration with

primary competence Secondary: 20%

Calculation of 2.5 hours Primary: 10%

benefit 69 Secondary:

20%

Annual control 0 hours Primary: 10%

Secondary: 100%

Disagreement 1 hour Primary: regarding 0.01% determination of

national Secondary: administration with 5%

primary competence 70

Overlapping benefits 71 1 hour Primary: 5%

Secondary: 0.1%

Reimbursement 72 1 hour Primary: 0.1%

Secondary: 0%

Recovery 73 1 hour Primary:

0.05%

Secondary: 0.1%

Notes: (1) Source: Pacolet and De Wispelaere (2015). (2) Using unit labour cost estimates based on Eurostat data.

69 More information will probably be necessary to calculate the benefit.

70 The number of cases where the MS disagree will probably increase.

EUROPEAN COMMISSION

Table G-4 Change in administrative costs and burden from Option 3 – Romania as Member State of primary and secondary competence

Administrative task Change in Frequency Number of Change in average cases (1) administrat man-hours ive costs, per case Total, EUR 1,000 (2)

A typical case; first Primary: 100% Primary: Primary: time handling of a 1.15 11427 30.4 case - all regular

tasks included (not Secondary: Secondary: Secondary: annual control) 1.30 4616 3.5

Determination of 1 hour Primary: national administration 100% with primary

competence 74 Secondary: 20%

Calculation of benefit 0 hours Primary:

10%

Secondary: 20%

Annual control 75 1 hour Primary:

10%

Secondary: 100%

Disagreement regarding 2 hours Primary: determination of 0.01% national administration

with primary Secondary: competence 76 5%

Overlapping benefits 77 1 hour Primary: 5%

Secondary: 0.1%

Reimbursement 78 1 hour Primary:

0.1%

Secondary: 0%

Recovery 79 1 hour Primary:

0.05%

Secondary: 0.1%

74 The number of tasks and checks will probably increase.

75 The number of tasks and checks will probably increase.

76 The number of tasks and checks will probably increase.

EUROPEAN COMMISSION

Notes: (1) Source: Pacolet and De Wispelaere (2015). (2) Using unit labour cost

estimates based on Eurostat data.

Administrative implications for families from revisions to EU provisions on exports of family benefits

Though they find it hard to estimate, the National Agency for Payments and Social Inspection believe that the revisions will lead to an increase in time spent by the families on providing information.

Conclusions

The annual number of cases handled in Romania per year is estimated at 11427 when Romania is the Member State of primary competence, while the number of cases is somewhat lower, 4616, when being the Member State of secondary competence.

Currently, the administrative resources spent on each case amount to 1.46 hours for an average case when Romania is the Member State primary competence, and to 0.37 hours when of secondary competence.

The overall assessment is that the changes to the administrative tasks will be quite significant. This is particularly the case for Option 3.

EUROPEAN COMMISSION

Annex H – Case study for UK

Introduction

In this section, we give a short description of the UK legislation on family benefits, which kind of benefits it includes, who is eligible, and how the legislation is interpreted by the national administrative institution handling family benefits, Her Majesty's Revenue and Customs.

In the UK, this includes child benefits, which is a tax financed (non-contributory, not means-tested) system available for persons responsible for raising a child or children. The claimant must be present, ordinarily resident and have a right to reside in the UK. Claimant’s immigration status not subject to any limitation or condition Child and claimant to be present in UK and living together.

The benefits apply normally to children of up to 16 years or if continuing in non-advanced education or approved training up to 20th birthday. Generally, the child must be present in the UK.

In 2015, the benefit rates are GBP 88.83 (EUR 111) per month for the eldest qualifying child of a couple (monthly amount). For each other child GBP 58.72 (EUR 73).

Current administrative costs and burden

To determine the current administrative costs and burden in handling family benefits in the UK an interview with Her Majesty's Revenue and Customs was conducted. In general, the interviewee found it difficult to assess administrative costs and burden as no actual measurements are made. Hence, the assessments of current costs provided are rough estimates only, while no assessments of the changes to these as a result of revisions to the EU provisions have been provided.

With this caveat in mind, Table H-1 shows that Pacolet and De Wispelaere (2015) estimates that the UK as primary competence handles just above 20,000 cases a year. The administrative resources spent on average on these cases are estimated to amount to almost six man-hours per case. This is higher than for the other case study Member States. Much time seems, for example, to be spent on determining who the national administration with primary competence is, and on settling disagreements in this regard.

With the significant number of cases, the total administrative costs amount to almost mEUR 2 per year.

EUROPEAN COMMISSION

Table H-1 Current administrative costs and burden – UK as Member State of primary competence

Administrative task Average Frequency Number of Administrative man-hours cases (1) costs, Total,

per case EUR 1,000 (2)

A typical case; first 5.75 hours 100% 20271 1955.1 time handling of a case - all regular tasks included (not annual control)

Determination of 2 hours 100% national administration with primary competence

Calculation of benefit 2 hours 100%

Annual control 0.75 hours 100%

Disagreement regarding 2 hours 15% determination of primary competence

Overlapping benefits 2 hours 25%

Reimbursement 0.75 hours 40%

Recovery 0.75 hours 20%

Notes: (1) Source: Pacolet and De Wispelaere (2015). (2) Using unit labour cost estimates

based on Eurostat data.

Table H-2 then shows that Pacolet and De Wispelaere (2015) estimates that the UK as primary competence handles around 3,300 cases a year. The administrative resources spent on average on these cases are estimated to amount to 2.75 man-hours per case. This is similar to for the other case study Member States. The total administrative costs amount to almost EUR 200,000 per year.

EUROPEAN COMMISSION

Table H-2 Current administrative costs and burden – UK as Member State of secondary competence

Administrative task Average Frequency Number of Administrative man-hours cases (1) costs, Total,

per case EUR 1,000 (2)

A typical case; first 2.75 hours 100% 3391 171.3 time handling of a case - all regular tasks included (not annual control)

Determination of 0.75 hours 100% national administration with primary competence

Calculation of benefit 0.75 hours 100%

Annual control 0.75 hours 100%

Disagreement regarding 2 hours 15% determination of primary competence

Overlapping benefits 2 hours 25%

Reimbursement 0.75 hours 40%

Recovery 0.75 hours 20%

Notes: (1) Source: Pacolet and De Wispelaere (2015). (2) Using unit labour cost estimates

based on Eurostat data.

Change in administrative costs and burden from revised EU provisions

As mentioned above, it was not feasible for the UK interviewee to provide estimates of the change in the administrative costs from revisions to the EU provisions.

Administrative implications for families from revisions to EU provisions on exports of family benefits

Similarly, the UK interviewee could not assess the administrative implications for the families.

Conclusions

The annual number of cases handled in the UK per year is estimated at 20,271 when the UK is the Member State of primary competence, while the number of cases is somewhat lower, 3,391, when the UK is the Member State of secondary competence.

Currently, the administrative resources spent on each case amount to 5.75 hours for an average case when of primary competence, and to 2.75 hours when of secondary competence.

EUROPEAN COMMISSION

It has not been feasible to obtain estimates of the change in the administrative costs from revisions to the EU provisions.

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ANNEX XVII: Brodolini Report Administrative Costs unemployment benefits

Task 2: Administrative costs of handling aggregation of

periods or salaries for

unemployment benefits

Study to analyse and assess the impacts of policy

options for a possible EU initiative in the area of

coordination of social security schemes, in particular

with regard to the revision of the current EU provisions

on the entitlement to unemployment benefits

EUROPEAN COMMISSION

EUROPEAN COMMISSION

Directorate-General for Employment, Social Affairs and Inclusion

Directorate B — Employment and Social Legislation, Social Dialogue

Unit B.4 — Free Movement of Workers and Coordination of Social Security Schemes

European Commission

EUROPEAN COMMISSION

Task 2: Administrative costs of handling aggregation of

periods or salaries for

unemployment benefits

Study to analyse and assess the impacts of policy

options for a possible EU initiative in the area of

coordination of social security schemes, in particular

with regard to the revision of the current EU provisions

on the entitlement to unemployment benefits

Europe Direct is a service to help you find answers to your questions about the European Union.

Freephone number (*):

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Luxembourg: Publications Office of the European Union, 2015

doi: [number]

Reproduction is authorised provided the source is acknowledged.

Tables of Contents

EXECUTIVE SUMMARY .................................................................................................. 9

1.

INTRODUCTION ................................................................................................. 17
1.1. Background and purpose............................................................................ 17

1.2. Methodology ............................................................................................ 18

1.3. Case study Member States ......................................................................... 19

2.

CURRENT ADMINISTRATIVE COSTS AND BURDEN .................................................. 21
2.1. National administrations ............................................................................ 21

2.2. Mobile EU-workers and their families ........................................................... 25

3.

CHANGE IN ADMINISTRATIVE COSTS AND BURDEN FROM REVISED EU PROVISIONS .. 26
3.1. National administrations ............................................................................ 26

3.2. Mobile EU-workers and their families ........................................................... 32

4.

CONCLUSIONS .................................................................................................. 33

ANNEX A – LITERATURE ............................................................................................. 35

ANNEX B – INTERVIEW GUIDE .................................................................................... 36

ANNEX C – CASE STUDY FOR GERMANY ....................................................................... 49

ANNEX D – CASE STUDY FOR DENMARK ....................................................................... 56

ANNEX E – CASE STUDY FOR NETHERLANDS ................................................................ 63

ANNEX F – CASE STUDY FOR POLAND .......................................................................... 69

ANNEX G – CASE STUDY FOR ROMANIA ....................................................................... 78

ANNEX H – CASE STUDY FOR UK ................................................................................. 85

EXECUTIVE SUMMARY .................................................................................................. 1

1.

INTRODUCTION ................................................................................................ 4

2.

METHODOLOGY ................................................................................................. 7
2.1. General approach ..................................................................................... 7

2.2. Data and data limitation ........................................................................... 7

2.3. Literature review ..................................................................................... 8

2.4. Simulation approach .............................................................................. 11

2.4.1. The estimation of mobility changes ............................ 12

2.4.2. The estimation of expenditure changes ................... 14

Task 2: Administrative costs of handling aggregation of periods or salaries for unemployment benefits

3.

STATUS QUO SCENARIO .................................................................................. 17
3.1 Status quo mobility flows .......................................................................... 17

3.2 Status quo target population ..................................................................... 17

4.

SECONDARY EFFECTS: ESTIMATION OF MOBILITY CHANGES ........................... 20

5.

SECONDARY EFFECTS: ESTIMATION OF EXPENDITURE CHANGES .................... 24
5.2 Possible effects of family reunifications .................................................... 28

6.

CONCLUSIONS ................................................................................................ 30

ANNEX 1 – LIST OF FAMILY BENEFITS WITHIN THE SCOPE OF THE STUDY (SOURCE

MISSOC). ........................................................................................................ 32

ANNEX 2 – SECONDARY EFFECTS: ESTIMATION OF MOBILITY PATTERNS. DETAILED RESULTS OF BILATERAL RELATIONS BETWEEN SELECTED MSS ....... 35

ANNEX 3 - SECONDARY EFFECTS: ESTIMATION OF EXPENDITURE CHANGES. DETAILED RESULTS OF BILATERAL RELATIONS BETWEEN SELECTED MSS ....... 39

ANNEX 4 – EXTENSION OF RESULTS TO EU-28 COUNTRIES ..................................... 45

5.

INTRODUCTION ................................................................................................ 4

6.

METHODOLOGY ................................................................................................. 6

6.1. General approach ..................................................................................... 6

6.2. Data and data limitation ........................................................................... 7

6.3. Literature review ..................................................................................... 7

6.4. Simulation approach .............................................................................. 11

6.4.1. The estimation of mobility changes ............................ 12

6.4.2. The estimation of expenditure changes ................... 16

6.5. Case study Member States ..................................................................... 16

7.

STATUS QUO SCENARIO .................................................................................. 18

3.1 Status quo mobility flows ....................................................................... 18

3.2 Status quo target population .................................................................. 19

8.

SECONDARY EFFECTS: ESTIMATION OF MOBILITY CHANGES ........................... 21

8.1. Refinement of policy options 2a and 2b .................................................. 24

9.

SECONDARY EFFECTS: ESTIMATION OF EXPENDITURE CHANGES .................... 26

9.1. Refinement of policy options 2a and 2b .................................................. 30

10.

CONCLUSIONS ................................................................................................ 31

ANNEX 1 – LIST OF UNEMPLOYMENT BENEFITS WITHIN THE SCOPE OF THE STUDY 33

ANNEX 2 - SECONDARY EFFECTS ANALYSIS: MOBILITY PATTERNS. DETAILED

RESULTS OF BILATERAL RELATIONS BETWEEN SELECTED MSS ........................ 39

ANNEX 3 – SECONDARY EFFECTS ANALYSIS: COST CHANGES ................................. 49

ANNEX 4 – EXTENSION OF RESULTS TO EU-28 COUNTRIES ..................................... 59

11.

INTRODUCTION ................................................................................................ 4 Task 2:

Administrative costs of handling aggregation of periods or salaries for unemployment benefits

12.

METHODOLOGY ................................................................................................. 6

12.1. General approach ..................................................................................... 6

12.2. Data and data limitation ........................................................................... 7

12.3. Literature review ..................................................................................... 7

12.4. Simulation approach .............................................................................. 11

12.4.1. The estimation of mobility changes ............ 12

12.4.2. The estimation of expenditure changes ... 16

12.5. Case study Member States ..................................................................... 16

13.

STATUS QUO SCENARIO .................................................................................. 18

3.3 Status quo mobility flows ....................................................................... 18

3.4 Status quo target population .................................................................. 19

14.

SECONDARY EFFECTS: ESTIMATION OF MOBILITY CHANGES ........................... 21

14.1. Refinement of policy options 2a and 2b .................................................. 24

15.

SECONDARY EFFECTS: ESTIMATION OF EXPENDITURE CHANGES .................... 26

15.1. Refinement of policy options 2a and 2b .................................................. 30

16.

CONCLUSIONS ................................................................................................ 31

ANNEX 1 – LIST OF UNEMPLOYMENT BENEFITS WITHIN THE SCOPE OF THE STUDY 33

ANNEX 2 - SECONDARY EFFECTS ANALYSIS: MOBILITY PATTERNS. DETAILED

RESULTS OF BILATERAL RELATIONS BETWEEN SELECTED MSS ........................ 39

ANNEX 3 – SECONDARY EFFECTS ANALYSIS: COST CHANGES ................................. 49

ANNEX 4 – EXTENSION OF RESULTS TO EU-28 COUNTRIES ..................................... 59

ANNEX XX ................................................................................................................ 64

TECHNICAL PROVISIONS TO BE INCLUDED WITHIN THE REVISION WHICH ARE NOT

SUBJECT TO IMPACT ASSESSMENT ...................................................................... 65

Introduction ...................................................................................................... 65

Technical amendments to the text and annexes ..................................................... 65

Technical amendments to the text in field of posting ............................................... 65

Governance change ............................................................................................ 66

Legal basis for data exchange to detect fraud and error ........................................... 66 Task 2:

Administrative costs of handling aggregation of periods or salaries for unemployment benefits

Executive Summary

The right to unemployment benefits in all Member States depends on having fulfilled a qualifying period. Regulation (EC) No 883/2004 i of the European Parliament and of the Council of 29 April 2004 on the coordination of social security systems specifies in Article 61 the principle of aggregation, which means that if a person does not have a sufficiently long unemployment benefit insurance record in the last Member State of activity/insurance – henceforth called the Member State of last employment, periods fulfilled in another Member State – henceforth called the Member State of previous employment. Most Member States apply the principle of aggregation after one day of insurance. This may lead to cases where unemployment benefits are being claimed after a very short period of being member of the insurance system in the Member State of last employment. It has therefore been questioned whether the current rules sufficiently ensure that a worker has an effective link to the given labour market and the related insurance system before claiming unemployment benefits there, either in terms of the length of the insurance periods fulfilled or in terms of the calculation basis for the unemployment benefits. Furthermore, claiming benefits after a short period of insurance or (self-)employment may have negative financial consequences for the Member States which has to pay the benefits.

Revisions to the current rules are therefore being considered to ensure uniform application of the principle of aggregation across Member States. This is done to ensure that the financial burden for paying unemployment benefits does not arise in situations, where mobile EU-workers have not yet made a significant contribution to the insurance system in the Member State of last employment, and in general to avoid undesirable uses of the unemployment benefit insurance systems in the EU. However, such revisions to the rules may also have implications for the administrative costs and burden for the national administrations handling aggregation of unemployment benefit cases as well as for the EU-workers themselves and their families.

On this background, the present study looks into the following four possible revisions to

Regulation (EC) No 883/2004 i:

• O ption 2a: A threshold of one month of insurance or (self-)employment needs to be

completed in the Member State of last employment before aggregation of periods of insurance, employment or self-employment fulfilled in a Member State of previous employment can be applied 80 .

• O ption 2b: A threshold of three months of insurance or (self-)employment needs to

be completed in the Member State of last employment before aggregation of

80 We also qualitative assess the possible additional administrative burden, if the option is modified/extended to make the Member State of previous employment responsible for paying unemployment benefits for those workers who have not completed the required period of insurance or (self-)employment in the Member

Task 2: Administrative costs of handling aggregation of periods or salaries for unemployment benefits

periods of insurance, employment or self-employment fulfilled in a Member State of previous employment can be applied 81 .

• O ption 3a: The salary earned in the Member State of previous employment is also

taken into account for the calculation of the unemployment benefit by the Member State of last employment, if less than one month of insurance or (self-) employment is completed in the Member State of last employment. The calculation is made within a national reference period.

• O ption 3b: The salary earned in the Member State of previous employment is also

taken into account for the calculation of the unemployment benefit by the Member State of last employment, if less than three months of insurance or (self-) employment is completed in the Member State of last employment. The calculation is made within a national reference period.

There is, however, no official information available on the costs of the different administrative tasks carried out by the national administrations in the Member States when handling a case of aggregation of unemployment benefits. Therefore, the study has obtained this information from its primary sources via interviews with national administrations. It was not feasible within the scope of Task 2 to gather such information for all 28 EU Member States. Hence, the results are based on analyses for six case study Member States: Germany, Denmark, Netherlands, Poland, Romania, and the UK.

Change in administrative costs and burden for national administrations acting as authority of last employment

A first observation, when assessing the administrative costs and burden for the national administrations in the Member States acting as authority of last employment, is that most of these national administrations – at least in the six case study Member States – only handle few cases annually. Only Poland experiences a notable number of cases with 1,517 (in 2013) while the Romanian national administration only had to handle 12 cases. Hence, from the outset it could be assumed that there within many national administrations only is little experience with handling aggregation cases and not that much focus on the costs of doing so. In any case, the current total administrative costs are limited in an overall context.

Currently, the national administrations in the case study Member States use as shown in

Table 0-1 on average less than 1.5 man-hours per case, most of which is used for the collection of information from Member States of previous employment about the applicants' employment and insurance histories, followed by resources spent on the calculation of the unemployment benefit payments. The man-hour use is fairly similar in between the case study Member States, and there is no tendency to that high labour cost Member States such as Denmark and the Netherlands carry out the administrative tasks using less manpower than low labour cost Member States such as Poland and Romania.

Task 2: Administrative costs of handling aggregation of periods or salaries for unemployment benefits

Table 0-1 National administrations handling aggregations of unemployment benefits as authority of last employment, man-hours per average case

Administrative tasks DE DK NL PL RO UK Av.

Standard administrative tasks

Collecting information 0.20 1.42 0.50 0.56 0.88 0.75 0.72

Calculation of benefit 0.20 0.21 0.50 0.32 1.00 0.38 0.43

Additional administrative tasks

Determination of residence 0.00 0.04 0.05 0.63 0.00 0.00 0.12

Change in circumstances 0.00 0.08 0.03 0.07 0.00 0.00 0.03

Reimbursement 0.00 0.00 0.00 0.01 0.00 0.00 0.00

Recovery 0.00 0.07 0.02 0.00 0.00 0.00 0.01

Other 0.10 0.00 0.00 0.25 0.00 0.00 0.06

TOTAL 0.50 1.81 1.10 1.83 1.88 1.13 1.37 Sources: Interviews.

This study assesses as shown in Table 0-2 that the administrative tasks will be almost unchanged if it is decided to implement Option 2a or Option 2b – i.e. to introduce a threshold for the period of insurance or employment to be completed in the Member State of last employment before the aggregation principle applies. If Options 2a and 2b are modified/extended to make the Member State of previous employment responsible for paying unemployment benefits for those workers who have not completed the required period of insurance or (self-)employment in the Member State of last employment, there will be an additional need for the latter national administration to inform the former about this situation. Although the interviewees have not assessed the administrative burden of doing this, we would expect this to a minor additional task as the national administration of last employment in any case is in contact with the national administration of previous employment regarding the exchange of information about the given applicant.

For Options 3a and 3b – i.e. taking into account the salary earned in the Member State of previous employment in the unemployment benefit calculation – it is assessed that each case on average will take around 20 minutes longer to handle, i.e. 28-29% increase. This increase is caused by the need to collect information as the salary earned in the Member State of previous employment and to use this in the calculation of the unemployment benefit payment.

Task 2: Administrative costs of handling aggregation of periods or salaries for unemployment benefits

Table 0-2 Change in the man-hours per administrative task for aggregation of unemployment benefit cases handled by national administrations as authority of last employment (simple average of case study Member States)

Administrative tasks Option 2a Option 2b Option 3a Option 3b

Man Man% from Man% from hour % from Man% from hours base hours base s base hours base

Standard admin. tasks

Collecting 46.5 information 0.00 0.0% 0.00 0.0% 0.33 % 0.33 46.5%

Calculation of 30.7 benefit 0.00 0.0% 0.00 0.0% 0.13 % 0.13 30.7%

Additional admin. tasks

-

- 30.9 - 30.9 - Det. of residence -0.04 % -0.03 24.1% -0.04 % -0.03 24.1%

Change in 21.8 circumstances 0.01 % 0.01 21.8% 0.00 0.0% 0.00 0.0%

Reimbursement -0.05 0.0% -0.04 0.0% -0.05 0.0% -0.04 0.0%

14.5 Recovery 0.00 % 0.00 14.5% 0.00 0.0% 0.00 0.0%

Other 0.00 0.0% 0.00 0.0% 0.00 0.0% 0.00 0.0%

-

5.5 - - 27.9 29.1 TOTAL -0.08 % 0.06 4.2% 0.38 % 0.40 %

Sources: Interviews.

In monetary terms, the assessment is as shown in Table 0-3 that the revisions will lead to minor changes in total administrative costs. Only in Poland a change in the unit costs per case and in total costs in EUR is expected as a result of Options 2a and 2b.

Task 2: Administrative costs of handling aggregation of periods or salaries for unemployment benefits

Table 0-3 Change in unit costs per case and total costs handling aggregation of unemployment benefit cases by national administrations as authority of last employment – main calculation

Member State Option 2a Option 2b Option 3a Option 3b

Total Total Total

Unit Total costs costs Unit costs

costs costs

Unit Unit costs 1000 costs 1000 costs 1000 EUR 1000 EUR EUR EUR EUR EUR EUR EUR

DE: Germany 0.0 0.0 0.0 0.0 11.3 8.9 11.3 8.9

DK: Denmark 0.0 0.0 0.0 0.0 15.1 0.8 15.1 0.8

NL: Netherlands 0.0 0.0 0.0 0.0 8.4 1.4 8.4 1.4

PL: Poland -2.3 -3.5 -1.8 -2.7 -0.8 -1.2 -0.3 -0.4

RO: Romania 0.0 0.0 0.0 0.0 2.5 0.0 2.5 0.0

UK: United

Kingdom 0.0 0.0 0.0 0.0 0.0 0.0 0.0 0.0 Sources: Interviews and Eurostat.

Change in administrative costs and burden for national administrations

acting as authority of previous employment

The observation that most national administrations of last employment only handle few cases of unemployment period aggregations implies that this also will be the case for most national administrations of previous employment – as the total number of cases is the same from both perspectives for the EU as a whole. This said, the number of cases handled by the six case study Member States of previous employment is somewhat higher than that when being of Member State of last employment. The UK experiences with 3,333 (in 2013) the largest number of cases, followed by Germany with 1,164 cases. However, in relation to the size of the national labour market, Denmark handles with 686 cases most.

Currently, the national administrations in the case study Member States use as shown in Table 0-4 on average less than one man-hour per case, with almost all time spent on the standard administrative task of providing information – i.e. to respond to a request from a Member State of last employment regarding an applicant's insurance and employment history. There is, however, some variation in the average time spent in between the case study Member States. In particular, the unemployment funds in Romania spend much time responding to a request for information about an applicant's previous insurance and employment history. At the other end, the UK does not see that of being the authority of previous employment involving much work.

Task 2: Administrative costs of handling aggregation of periods or salaries for unemployment benefits

Table 0-4 National administrations handling aggregations of unemployment benefits as authority of previous employment, man-hours per average case

Administrative tasks DE DK NL PL RO UK Av.

Standard administrative tasks

Providing information 0.50 0.67 0.67 0.67 2.48 0.00 0.83

Additional administrative tasks

Determination of residence 0.00 0.00 0.00 0.46 0.00 0.01 0.08

Change in circumstances 0.00 0.00 0.00 0.15 0.00 0.00 0.02

Reimbursement 0.00 0.00 0.00 0.00 0.00 0.00 0.00

Recovery 0.00 0.00 0.00 0.00 0.00 0.00 0.00

TOTAL 0.50 0.67 0.67 1.27 2.48 0.01 0.93

Sources: Interviews.

Similar to for the national administrations of last employment, Option 2a and Option 2b will as shown in Table 0-5 not make almost no changes to the administrative tasks of the national administrations when acting as authority of previous employment. However, if Options 2a and 2b are modified/extended to make the Member State of previous employment responsible for paying unemployment benefits for those workers who have not completed the required period of insurance or (self-)employment in the Member State of last employment, the national administration of previous employment will have two new administrative tasks. Firstly, there will be a minor task of receiving and registering the information about the situation. Secondly, the national administration will calculate the benefits that the applicant is entitled to according to its national legislation. Our best estimate of the additional administrative burden of this is the time estimates provided by the national administrations of last employment for their similar tasks. Hence, based on their we assess that the national administration of previous employment will spent around 20 minutes extra for each case where it becomes responsible for paying the unemployment benefits.

This assessment of limited impacts goes, however, also for Options 3a and 3b when having the role as authority of previous employment.

Task 2: Administrative costs of handling aggregation of periods or salaries for unemployment benefits

Table 0-5 Change in the man-hours per administrative task for aggregation of unemployment benefit cases handled by national administrations as authority of previous employment (simple average of case study Member States)

Administrative tasks Option 2a Option 2b Option 3a Option 3b

Man Man% from Man% from hour % from Man% from hours base hours base s base hours base

Standard admin. tasks

Providing information 0.01 0.8% 0.01 0.8% 0.06 7.7% 0.06 7.7%

Additional admin. tasks

-

- - 57.2 - Det. of residence -0.04 57.2% -0.04 57.2% -0.04 % -0.04 57.2%

Change in 112.4 112.4 circumstance 0.01 33.7% 0.01 33.7% 0.03 % 0.03 %

Reimbursement -0.06 0.0% -0.06 0.0% -0.06 0.0% -0.06 0.0%

Recovery 0.00 0.0% 0.00 0.0% 0.03 0.0% 0.03 0.0%

-

- 5.3 TOTAL -0.08 -8.8% 0.08 8.8% 0.05 % 0.05 5.3%

Sources: Interviews.

Hence as shown in Table 0-6, also in monetary terms the assessment is that the revisions will lead to minor changes in total administrative costs.

Table 0-6 Change in unit costs per case and total costs handling aggregation of unemployment benefit cases by national administrations as authority of previous employment – main calculation

Member State Option 2a Option 2b Option 3a Option 3b

Total Total Total

Unit Total costs Unit costs Unit costs

costs costs

Unit costs 1000 costs 1000 costs 1000 EUR 1000 EUR EUR EUR EUR EUR EUR EUR

DE: Germany 0.0 0.0 0.0 0.0 4.1 4.8 4.1 4.8

DK: Denmark 1.2 0.8 1.2 0.8 1.2 0.8 1.2 0.8

NL: Netherlands 0.0 0.0 0.0 0.0 0.0 0.0 0.0 0.0

PL: Poland -2.7 -0.4 -2.7 -0.4 0.3 0.04 0.3 0.04

RO: Romania 0.0 0.0 0.0 0.0 0.0 0.0 0.0 0.0

UK: United Kingdom 0.0 0.0 0.0 0.0 0.0 0.0 0.0 0.0

Sources: Interviews and Eurostat.

Task 2: Administrative costs of handling aggregation of periods or salaries for unemployment benefits

Change in administrative costs and burden for mobile EU-workers and their families

The proposed revisions to the EU provisions may well have implications for the mobile EU-workers and their families. Although it may not be considered as administrative implications, it is suggested that Option 2a and Option 2b may have a negative impact on the exercise of free movement, because a more complex legislation may discourage workers who were planning to move to another Member State.

Regarding Option 3a and Option 3b, compared with the current situation, applicants need to wait a longer time before they receive their benefits. This may further cause income problems for those without private savings. Furthermore, there is an increased requirement to provide documentation in the form of contracts, payslips etc.

Task 2: Administrative costs of handling aggregation of periods or salaries for unemployment benefits

Introduction

1.8. Background and purpose

Most Member States apply the principle of aggregation after one day of insurance. This may lead to cases where unemployment benefits are being claimed after a very short period of being member of the insurance system in the Member State of last employment. It has therefore been questioned whether the current rules sufficiently ensure that a worker has an effective link to the given labour market and the related insurance system before claiming unemployment benefits there, either in terms of the length of the insurance periods fulfilled or in terms of the calculation basis for the unemployment benefits. Furthermore, claiming benefits after a short period of insurance or (self-)employment may have negative financial consequences for the Member States which has to pay the benefits.

On this background, we look in the present study into the following four possible revisions to Regulation (EC) No 883/2004 i:

• O ption 2a: A threshold of one month of insurance or (self-)employment needs to be

completed in the Member State of last employment before aggregation of periods of insurance, employment or self-employment fulfilled in a Member State of previous employment can be applied 82 .

• O ption 2b: A threshold of three months of insurance or (self-)employment needs to

be completed in the Member State of last employment before aggregation of periods of insurance, employment or self-employment fulfilled in a Member State of previous employment can be applied 83 .

• O ption 3a: The salary earned in the Member State of previous employment is also

taken into account for the calculation of the unemployment benefit by the Member

82 We also qualitative assess the possible additional administrative burden, if the option is modified/extended to make the Member State of previous employment responsible for paying unemployment benefits for those workers who have not completed the required period of insurance or (self-)employment in the Member State of last employment.

Task 2: Administrative costs of handling aggregation of periods or salaries for unemployment benefits

State of last employment, if less than one month of insurance or (self-) employment is completed in the Member State of last employment. The calculation is made within a national reference period.

• O ption 3b: The salary earned in the Member State of previous employment is also

Such revisions may affect the behaviour of the mobile EU-workers and their families, the amounts of unemployment benefits being paid, and the administration needed to handle the aggregation of unemployment benefit cases. The analysis within Task 2 focuses on the latter issue – i.e. the changes to the administrative costs and burden for the national administrations handling aggregation of unemployment benefit cases from the revisions. In this context, Task 2 distinguishes between the administrative costs incurring in the Member States of last employment and those incurring in the Member States of previous employment. Furthermore, we look into the possible changes in the administrative burdens for the mobile EU-workers themselves and their families.

There is, however, as described further below no official information available on the costs of the different administrative tasks carried out by the national administrations in the Member States when handling a case of aggregation of unemployment benefits. Therefore, we have obtained this information from its primary sources via interviews with national administrations. It was not feasible within the scope of Task 2 to gather such information for all 28 EU Member States. Hence, the results are based on analyses for six case study Member States: Germany, Denmark, Netherlands, Poland, Romania, and the UK.

1.9. Methodology

As just introduced above, Task 2 focuses on assessing the administrative costs and burden for the national administrations handling aggregation of unemployment benefit cases. For this, we have made use of the definition of administrative costs and burden provided by the EC (2009) Impact Assessment Guidelines. While doing this, we have adopted a broad definition of administrative information obligations – i.e. we have considered the costs of administrative tasks such as the collection and provision of information, the calculation of benefits, and the reimbursement and recovery of benefits in between Member States. We have then assessed how these administrative costs may change from the revisions to Regulation (EC) No 883/2004 i to comprise an additional administrative burden – positive or negative – for the national administrations as well as for the mobile EU-workers and their families. This approach is also in line with the Better Regulation Guidelines (EC, 2015) emphasises objective of delivering maximum benefits to citizens, businesses and workers while avoiding all unnecessary regulatory burdens, and so avoiding unnecessary additional administrative burdens.

The calculations of the administrative costs for the national administrations are as illustrated in Figure 1-1 in principle simple. Firstly, the number of cases in the left-hand side of the figure are the annual cases of aggregation of unemployment benefits currently registered in the six case study Members States. Actually, a given case may be dealt with in two of the six selected Member States if, for example, a given applicant for aggregation (i.e. in a Member State of last employment) comes from another of the six Member States (i.e. in a Member State of previous employment). In our main calculation, we assume that the number of cases does not change due to revising the EU provisions. However, we do to illustrate the sensitivity of this assumption also show a scenario

Task 2: Administrative costs of handling aggregation of periods or salaries for unemployment benefits

where we assume a change in the number of cases based on the results of Task 4 of this study.

Secondly, we calculate the unit costs for the national administration – i.e. the current administrative costs per case as well as the changed administrative costs per case as a result of revising the EU provisions. The administrative costs per case will clearly differ between cases, i.e. there will be easy cases only involving standard administrative tasks while other more complex cases will involve additional tasks. Hence, we are in practice looking for average costs. These unit costs in EUR are composed of assessments of the man-hours needed per case and the costs per man-hour in EUR (see Table 1-1 in the next section).

Figure 1-1 Calculation of administrative costs for national administrations

The bulk of the work within Task 2 has been the estimation of the man-hours needed to carry out the administrative tasks of handling a case of aggregation of unemployment benefits. As already mentioned, such information is not available from official sources, and so we have gathered the information through interviews with national administrations in the six case study Member States. For this purpose we identified the national administrations to interview (see Annexes C to H for the interviewees), and we developed an interview guide that was shared with our Member States experts/interviewers in the six case study Member States in their respective national languages (see Annex B for the English version of the interview guide). The interview guide was developed via a desk study approach by reviewing existing literature and guidance papers on the legislation (see Annex A) and it was tested in Denmark before being applied in the five other case study Member States.

Task 2: Administrative costs of handling aggregation of periods or salaries for unemployment benefits

1.10. Case study Member States

As already mentioned, the calculations of the administrative costs and burden are based on information for six case study Member States only. Although, it is not the aim of Task 2 to produce a total EU-28 figure for the administrative costs and burden via an upscaling of the calculations from the case studies, we have aimed to select Member States that represent the variety within the EU.

Firstly, we have selected Member States that are geographically spread across the EU. Secondly, the selection comprises Member States that mainly attract mobile EU-workers (Germany, Denmark, Netherlands, UK) and Member States that mainly see workers leave (Poland, Romania). Thirdly, although all Member States apply the general principle of providing an income support to workers that have become (involuntarily) unemployed and all apply qualifying periods, there are some differences. While the Netherlands applies a qualifying period of less than one year, it is one year or above in Germany, Denmark, Poland and Romania. Furthermore, the income replacement rates are a percentage of past earnings averaged over more than three months in Germany, while Denmark and Netherlands only look at earnings during the last three months. Poland, Romania and the UK apply a flat or fixed rate 84 . Finally, the case study Member States may well differ with respect to the capacity of administration, to the development of IT, and to the standard of living.

Redading the latter, as shown in Table 1-1, the unit labour costs of the national administrations differ much in between the case study Member States. We assume here that the average wage levels of the relevant employees in the national administrations are similar to that of employees in general in the public administration with upper secondary or post-secondary non-tertiary education. Although the differences in labour costs is a reflection of general differences in labour costs in between the Member States, it could be expected that this may lead to differences in the use of man-power to carry out the administrative tasks. It could, for example, be expected that higher labour costs could lead to fewer labour-intensive processes – and vice versa. However, as shown below such difference have not been detected in between higher and lower labour cost Member States.

Table 1-1 Labour costs, 2013, EUR per hour - employees in public administration etc. with upper secondary or post-secondary non-tertiary education

Member State Wage costs, Wage costs, Labour costs, 2010, 2013, 2013,

EUR per hour (1) (2) EUR per hour EUR per hour (3)

DE: Germany 14.9 16.4 20.5

DK: Denmark 22.3 23.4 29.3

NL: Netherlands 16.4 17.8 22.2

PL: Poland 3.8 4.1 5.1

RO: Romania 1.7 2.0 2.5

UK: United Kingdom 14.3 14.7 18.4 Sources: (1) Eurostat, Earnings survey, 2010 [the most recent] (earn_ses10_16). (2) 2013 estimates on the basis of Eurostat, Labour cost index ([lc_lci_r2_a). (3) Using 25%

overhead costs according to EC Impact Assessment Guidelines.

84 See Annexes C to H for more details on rules in the different case study Member States. Note in this context

Task 2: Administrative costs of handling aggregation of periods or salaries for unemployment benefits

Current administrative costs and burden

1.11. National administrations

The aggregation of unemployment benefit cases are handled by different types of national administrations in the case study Member States. In Germany and Denmark, it is the task of the private unemployment insurance institutions – both when acting as the authority of last employment and of previous employment. In the Netherlands, it is the Institute for Employee Benefit Schemes. In Poland, it is both at national and regional level Departments of Social Security Systems. In Romania, it is the National Agency for Employment, while it in the UK is the Department for Work and Pensions.

The below box describes an example of an aggregation of unemployment benefits currently handled by the national administrations.

Example of aggregation of unemployment benefits:

EU-worker A moves from Member State A [previous employment] to Member State B [last

employment] and works there for two weeks 85 before becoming unemployed. Currently, he can

claim unemployment benefits in Member State of last employment B based on his period of insurance in Member State of previous employment A.

National administrations handling aggregation of unemployment benefits as authority of last employment

Table 2-1 shows that the number of cases handled by national administrations acting as

authority of last employment varied between the case study Member States in 2013 86 .

This is not surprising given the difference in the sizes of the Member States, and given the fact that we both have selected Member States that mainly attract mobile EU-citizens and mainly see citizens leave. Actually, only Poland experiences a notable number of cases. The differences are also notable when looking at the number of cases relative to the sizes of the labour markets – i.e. total employment in the respective Member States.

85 Note that some Member States currently have stricter requirements, e.g. Denmark requires 8 weeks of work within 12 weeks to qualify.

86 2013 has been chosen as reference year, since the information on cases gathered by Pacolet and De

Task 2: Administrative costs of handling aggregation of periods or salaries for unemployment benefits

Table 2-1 Number of aggregations of unemployment benefits handled by national administrations in 2013 as authority of last employment

Member State Number of cases, 2013 Cases per 1000 employed

DE: Germany (1) 791 0.02

DK: Denmark 54 0.02

NL: Netherlands 160 0.02

PL: Poland 1517 0.10

RO: Romania 12 0.00

UK: United Kingdom 30 0.00

Sources: Pacolet and De Wispelaere (2015). Eurostat database (lfsi_emp_a).

(1)

Notes: Estimate made by consultant on the basis of data for Denmark and the Netherlands.

Table 2-2 shows for the six case study Member States, the man-hours per average case for the national administrations handling aggregation of unemployment benefits as authority of last employment. The administrative tasks are divided into standard administrative tasks and additional administrative tasks.

The former tasks, which are carried out for almost all cases, comprise information collection. Hence, for each application for aggregation of unemployment benefits, the national administration will collect the information necessary to decide on the payment of unemployment benefits to the applicant. This involves, for example, obtaining information from previous Member State(s) of insurance about insurance and employment histories. Table 2-2 shows that this task for an average case in a Member States takes between 0.20 man-hours in Germany and 1.42 man-hours in Denmark (see Annexes C to H for Member State-specific analyses).

The national administration of last employment will then calculate the benefits that the given applicant is entitled to according to the given national legislation, and it will set the payment of unemployment benefits in motion. Here the average time spent per case ranges from 0.20 man-hours in Germany to 1 man-hours in Romania.

The latter tasks, which are carried out more infrequently for the more complex cases, comprise, for example, the determination of residence when this is not obvious. This task leads to additional costs as a result of collecting additional information about family ties, housing situation, characteristics of the applicant's professional activities. In Poland, this is an important task, while it is of only little importance in the other case study Member States.

Furthermore, if circumstances of the applicant change this will require a determination of the type of change and it may lead to a change of competence and to a recalculation of benefits. Finally, there may be costs from reimbursement activities if provisional unemployment benefits awarded to an EU-worker should have been paid by another Member State, and from recovery activities if an applicant unjustified has received unemployment benefits.

Overall, Table 2-2 shows that currently the resources spent on a case by the national administration as authority of last employment averages less than 1.5 man-hours. Germany is a slight outlier at the low end, which appears to be caused by relative less emphasis on information collection. Denmark, Poland, and Romania are at the higher end, due to different tasks, however.

Task 2: Administrative costs of handling aggregation of periods or salaries for unemployment benefits

Table 2-2 National administrations handling aggregations of unemployment benefits as authority of last employment, man-hours per average case

Administrative tasks DE DK NL PL RO UK Av.

Standard administrative tasks

Collecting information 0.20 1.42 0.50 0.56 0.88 0.75 0.72

Calculation of benefit 0.20 0.21 0.50 0.32 1.00 0.38 0.43

Additional administrative tasks

Determination of residence 0.00 0.04 0.05 0.63 0.00 0.00 0.12

Change in circumstances 0.00 0.08 0.03 0.07 0.00 0.00 0.03

Reimbursement 0.00 0.00 0.00 0.01 0.00 0.00 0.00

Recovery 0.00 0.07 0.02 0.00 0.00 0.00 0.01

Other 0.10 0.00 0.00 0.25 0.00 0.00 0.06

TOTAL 0.50 1.81 1.10 1.83 1.88 1.13 1.37 Sources: Interviews.

When accounting for the differences in labour costs shown in Table 1-1, Table 2-3 shows that the average unit administrative costs in EUR differ more that the average man-hours shown in Table 2-2. The reason is that the high labour cost Members State, Denmark, also spend relatively most man-hours. This could be argued to be a surprising result, i.e. it could be expected that higher labour costs could lead to less labour-intensive processes.

The lower labour costs and man-hours spent in Poland and Romania imply that an average case costs around 5 to 10 EUR, while it in Denmark reaches above 50 EUR and in the Netherlands around 25 EUR. However, looking at total costs, Germany has with its many case the highest total costs.

Table 2-3 Administrative costs for national administrations handling aggregations of unemployment benefits as authority of last employment, unit costs and total costs 2013, EUR

DE DK NL PL RO UK Av.

Unit costs, EUR 10.3 53.0 24.3 9.4 4.7 20.7 20.4

Total costs, 1000 EUR 8.1 2.9 3.9 14.3 0.1 0.6

Sources: Table 1-1, Table 2-1, and Table 2-2.

National administrations handling aggregation of unemployment benefits as authority of previous employment

Table 2-4 then shows the number of cases handled by national administrations as authority of previous employment in the case study Member States in 2013 provided by Pacolet and De Wispelaere (2015). There is large variation in the number of cases. The UK experiences the largest number of cases, followed by Germany. This variation is also notable when looked at it in relation to the size of the national labour markets. Using this

Task 2: Administrative costs of handling aggregation of periods or salaries for unemployment benefits

measure, Denmark handles relatively the highest number of cases, followed by the Netherlands, the UK and Romania.

Table 2-4 Number of aggregations of unemployment benefits handled by national administrations in 2013 as authority of previous employment

Member State Number of cases, 2013 Cases per 1000 employed

DE: Germany 1164 0.03

DK: Denmark 686 0.26

NL: Netherlands 918 0.11

PL: Poland 147 0.01

RO: Romania 887 0.10

UK: United Kingdom 3333 0.11

Sources: Pacolet and De Wispelaere (2015). Eurostat database.

Table 2-5 shows for the six case study Member States, the unit administrative costs for the national administrations handling aggregations of unemployment benefits as authority of previous employment. The unit costs are here measured as man-hours per average case. Most cases involve time spent on the standard administrative task of providing information – i.e. to respond to a request from a Member State of last employment regarding an applicant's insurance and employment history.

More complex cases involve additional tasks that each may take significant time, but that will be infrequent. For the case study Member States this seems only to be significant for Poland, where time is spent on the determination of residence of the applicant and on dealing with changes in circumstances.

Overall, Table 2-5 shows that there is some variation in the average time spent in between the case study Member States. In particular, the unemployment funds in Romania spend much time responding to a request for information about an applicant's previous insurance and employment history. At the other end, the UK does not see that of being the authority of previous employment involving much work.

Task 2: Administrative costs of handling aggregation of periods or salaries for unemployment benefits

Table 2-5 National administrations handling aggregations of unemployment benefits as authority of previous employment, man-hours per average case

Administrative tasks DE DK NL PL RO UK Av.

Standard administrative tasks

Providing information 0.50 0.67 0.67 0.67 2.48 0.00 0.83

Additional administrative tasks

Determination of residence 0.00 0.00 0.00 0.46 0.00 0.01 0.08

Change in circumstances 0.00 0.00 0.00 0.15 0.00 0.00 0.02

Reimbursement 0.00 0.00 0.00 0.00 0.00 0.00 0.00

Recovery 0.00 0.00 0.00 0.00 0.00 0.00 0.00

TOTAL 0.50 0.67 0.67 1.27 2.48 0.01 0.93

Sources: Interviews.

Table 2-6 shows that the average unit administrative costs in EUR differ less than the average man-hours shown in Table 2-5. The reason is that the high labour cost Members States spend relatively few man-hours.

Table 2-6 Administrative costs for national administrations handling aggregations of unemployment benefits as authority of previous employment, unit costs and total costs 2013, EUR

DE DK NL PL RO UK Av.

Unit costs, EUR 10.3 19.5 14.9 6.5 6.3 0.1 9.6

Total costs, 1000 EUR 12.0 13.4 13.7 1.0 5.6 0.5

Sources: Table 1-1, Table 2-4, and Table 2-5.

1.12. Mobile EU-workers and their families

The interviews carried out in the six case study Member States have not revealed many concerns about the time spent at present by the mobile EU-workers and their families when applying for aggregation of unemployment benefits. However, as discussed in Section 3.2 the possible revisions to the EU provisions may well have implications.

Task 2: Administrative costs of handling aggregation of periods or salaries for unemployment benefits

Change in administrative costs and burden from revised EU provisions

1.13. National administrations

The administrative task of handling a case of aggregation of unemployment benefits may change in both size and characteristics if the EU provisions are revised. In this study we look as introduced in Section 1.1 into the following four possible revisions, that each are exemplified in the boxes below.

Option 2a: A threshold of one month of insurance or (self-)employment needs to be completed in the Member State of last employment before aggregation of periods of insurance, employment or self-employment fulfilled in a Member State of secondary competence can be applied.

Example of new situation:

EU-worker A becomes entitled to unemployment benefits in Member State A [of last employment] based on his insurance periods in Member State B [of previous employment] only

after completion of at least one month of unemployment insurance in Member State A.

Option 2b: A threshold of three months of insurance or (self-)employment needs to be completed in the Member State of last employment before aggregation of periods of insurance, employment or self-employment fulfilled in a Member State of previous employment can be applied.

Example of new situation:

EU-worker A becomes entitled to unemployment benefits in Member State A [of last employment] based on his insurance periods in Member State B [of previous employment] only

after completion of at least three months of unemployment insurance in Member State A.

Option 3a: The salary earned in the Member State of previous employment is also taken into account for the calculation of the unemployment benefit by the Member State of last employment, if less than one month of insurance or (self-) employment is completed in the Member State of last employment. The calculation is made within a national reference period.

Example of new situation :

EU-worker A becomes entitled to unemployment benefits in Member State A [of last employment] after only one day of insurance in Member State A; but, as he has been employed for less than one month in Member State A, the institution in Member State A also takes his salaries earned in Member State B [of previous employment] into account for the calculation of the amount.

Option 3b: The salary earned in the Member State of previous employment is also taken into account for the calculation of the unemployment benefit by the Member State of last employment , if less than three months of insurance or (self-) employment is completed in the Member State of last employment. The calculation is made within a national reference period.

Example of new situation :

EU-worker A becomes entitled to unemployment benefits in Member State A [of last

Task 2: Administrative costs of handling aggregation of periods or salaries for unemployment benefits

for less than three months in Member State A, the institution in Member State A also takes his salaries earned in Member State B [of previous employment] into account for the calculation of

the amount.

National administrations handling aggregation of unemployment benefits as authority of last employment

A first important observation is that on average across the case study Member States, the interviewed national administrations expect that their administrative tasks as authority of last employment are expected to be almost unchanged if it is decided to implement Option 2a or Option 2b. The small decreases observed in Table 3-1 solely stem from the assessment of the Polish interviewees – i.e. that the options may lead to easier handlings of the determination of residence and regarding reimbursement activities.

If Options 2a and 2b are modified/extended to make the Member State of previous employment responsible for paying unemployment benefits for those workers who have not completed the required period of insurance or (self-)employment in the Member State of last employment, there will be an additional need for the latter national administration to inform the former about this situation. Although the interviewees have not assessed the administrative burden of doing this, we would expect this to a minor additional task as the national administration of last employment in any case is in contact with the national administration of previous employment regarding the exchange of information about the given applicant.For Options 3a and 3b, it is expected that the manhours per case will increase by 28-29% which, however, only is around 20 minutes per case. This is mainly caused by increases in the need to collect information as the salary earned in the Member State of previous employment also must be taken into account in the calculation of the unemployment benefit payments.

Task 2: Administrative costs of handling aggregation of periods or salaries for unemployment benefits

Table 3-1 Change in the man-hours per administrative task for aggregation of unemployment benefit cases handled by national administrations as authority of last employment (simple average of case study Member States)

Administrative tasks Option 2a Option 2b Option 3a Option 3b

Man Man% from Man% from hour % from Man% from hours base hours base s base hours base

Standard admin. tasks

Collecting 46.5 information 0.00 0.0% 0.00 0.0% 0.33 % 0.33 46.5%

Calculation of 30.7 benefit 0.00 0.0% 0.00 0.0% 0.13 % 0.13 30.7%

Additional admin. tasks

-

- 30.9 - 30.9 - Det. of residence -0.04 % -0.03 24.1% -0.04 % -0.03 24.1%

Change in 21.8 circumstances 0.01 % 0.01 21.8% 0.00 0.0% 0.00 0.0%

Reimbursement -0.05 0.0% -0.04 0.0% -0.05 0.0% -0.04 0.0%

14.5 Recovery 0.00 % 0.00 14.5% 0.00 0.0% 0.00 0.0%

Other 0.00 0.0% 0.00 0.0% 0.00 0.0% 0.00 0.0%

-

5.5 - - 27.9 29.1 TOTAL -0.08 % 0.06 4.2% 0.38 % 0.40 % Sources: Interviews.

As just mentioned above, only the Polish interviewees expect as a change in the unit costs per case and in total costs in EUR as a result of Options 2a and 2b, c.f. Table 3-2. The costs implications of Options 3a and 3b are, however, also assessed to be negligible.

Task 2: Administrative costs of handling aggregation of periods or salaries for unemployment benefits

Table 3-2 Change in unit costs per case and total costs handling aggregation of unemployment benefit cases by national administrations as authority of last employment – main calculation

Member State Option 2a Option 2b Option 3a Option 3b

Total Total Total

Unit Total costs Unit costs Unit costs

costs costs

Unit costs 1000 costs 1000 costs 1000 EUR 1000 EUR EUR EUR EUR EUR EUR EUR

DE: Germany 0.0 0.0 0.0 0.0 11.3 8.9 11.3 8.9

DK: Denmark 0.0 0.0 0.0 0.0 15.1 0.8 15.1 0.8

NL: Netherlands 0.0 0.0 0.0 0.0 8.4 1.4 8.4 1.4

PL: Poland -2.3 -3.5 -1.8 -2.7 -0.8 -1.2 -0.3 -0.4

RO: Romania 0.0 0.0 0.0 0.0 2.5 0.0 2.5 0.0

UK: United

Kingdom 0.0 0.0 0.0 0.0 0.0 0.0 0.0 0.0 Sources: Interviews and Eurostat.

The number of cases are, however, likely to change as a result of revisions to the EU provisions. There might be changes due to changing eligibility criteria for qualifying for aggregation of unemployment benefits and so due to changing unemployment benefit incomes that affect the behaviour of the mobile EU-workers. Task 4 of the present study has estimated such behavioural changes. We have on the basis of the behavioural change estimates for workers with families composed of one-earner married couples with two children at 100 % of average earnings derived assumptions about the likely change in the number of cases handled by national administrations as authority of last employment (cf. Table 3-3).

Hence, the estimation/assumption is that Option 2a and Option 2b, which introduce thresholds – one month and three months, respectively, of insurance or (self)employment periods, have larger impacts on mobile EU-workers behaviour, than Option 3a and Option 3b, which specify that salaries earned in the Member States of previous employment also may be taken into account for the calculation of unemployment benefits.

Table 3-3 Change in number of aggregation of unemployment benefit cases handled by national administrations as authority of last employment

Member State Option 2a Option 2b Option 3a Option 3b

DE: Germany -3.5% -4.6% -1.3% -1.6%

DK: Denmark -7.0% -7.0% -2.3% -2.3%

NL: Netherlands -0.8% -1.6% -0.2% -0.4%

PL: Poland 0.0% -0.1% 0.0% 0.0%

RO: Romania 0.0% 0.0% 0.0% 0.1%

UK: United Kingdom -1.7% -1.7% -0.5% -0.5%

Sources: FGB et.al. (2015): Annex 2 - Table 2.3 and Table 2.4.

Task 2: Administrative costs of handling aggregation of periods or salaries for unemployment benefits

Adjusting the main results for such possible changes in the number of cases we get as shown in Table 3-4 slightly different results. While unit cost changes are the same as those presented in Table 3-2, the options lead to lower total costs compared with Table 3-4 for Member States such as Denmark and Germany as the number of cases to handle decreases.

Table 3-4 Change in unit costs per case and total costs handling aggregation of unemployment benefit cases by national administrations as authority of last employment – assuming changes in the number of cases

Member State Option 2a Option 2b Option 3a Option 3b

Total Total Total Total

Unit costs Unit costs Unit costs Unit costs

costs 1000 costs 1000 costs 1000 costs 1000 EUR EUR EUR EUR EUR EUR EUR EUR

DE: Germany 0.0 -0.3 0.0 -0.4 11.3 8.7 11.3 8.7

DK: Denmark 0.0 -0.2 0.0 -0.2 15.1 0.7 15.1 0.7

NL: Netherlands 0.0 0.0 0.0 -0.1 8.4 1.3 8.4 1.3

PL: Poland -2.3 -3.5 -1.8 -2.7 -0.8 -1.2 -0.3 -0.4

RO: Romania 0.0 0.0 0.0 0.0 2.5 0.0 2.5 0.0

UK: United Kingdom 0.0 0.0 0.0 0.0 0.0 0.0 0.0 0.0 Sources: FGB et.al. (2015): Annex 2 - Table 2.3 and Table 2.4, Eurostat and interviews.

National administrations handling aggregation of unemployment benefits as authority of previous employment

Table 3-5 shows that the changes in man-hours spent by authorities of previous employments as a result of the revisions are expected to be minor. This also implies that the changes measured in EUR in Table 3-6 are very limited.

However, if Options 2a and 2b are modified/extended to make the Member State of previous employment responsible for paying unemployment benefits for those workers who have not completed the required period of insurance or (self-)employment in the Member State of last employment, the national administration of previous employment will have two new administrative tasks. Firstly, there will be a minor task of receiving and registering the information about the situation. Secondly, the national administration will calculate the benefits that the applicant is entitled to according to its national legislation. Our best estimate of the additional administrative burden of this is the time estimates provided by the national administrations of last employment for their similar tasks. Hence, based on the estimates in Table 2-2 we assess that the national administration of previous employment will spent around 20 minutes extra for each case where it becomes responsible for paying the unemployment benefits.

Task 2: Administrative costs of handling aggregation of periods or salaries for unemployment benefits

Table 3-5 Change in the man-hours per administrative task for aggregation of unemployment benefit cases handled by national administrations as authority of previous employment (simple average of case study Member States)

Administrative tasks Option 2a Option 2b Option 3a Option 3b

Man Man% from Man% from hour % from Man% from hours base hours base s base hours base

Standard admin. tasks

Providing information 0.01 0.8% 0.01 0.8% 0.06 7.7% 0.06 7.7%

Additional admin. tasks

-

- - 57.2 - Det. of residence -0.04 57.2% -0.04 57.2% -0.04 % -0.04 57.2%

Change in 112.4 112.4 circumst. 0.01 33.7% 0.01 33.7% 0.03 % 0.03 %

Reimbursement -0.06 0.0% -0.06 0.0% -0.06 0.0% -0.06 0.0%

Recovery 0.00 0.0% 0.00 0.0% 0.03 0.0% 0.03 0.0%

-

- 5.3 TOTAL -0.08 -8.8% 0.08 8.8% 0.05 % 0.05 5.3%

Sources: Interviews.

Table 3-6 Change in unit costs per case and total costs handling aggregation of unemployment benefit cases by national administrations as authority of previous employment – main calculation

Member State Option 2a Option 2b Option 3a Option 3b

Total Total Total

Unit Total costs costs Unit costs

costs costs

Unit Unit costs 1000 costs 1000 costs 1000 EUR 1000 EUR EUR EUR EUR EUR EUR EUR

DE: Germany 0.0 0.0 0.0 0.0 4.1 4.8 4.1 4.8

DK: Denmark 1.2 0.8 1.2 0.8 1.2 0.8 1.2 0.8

NL: Netherlands 0.0 0.0 0.0 0.0 0.0 0.0 0.0 0.0

PL: Poland -2.7 -0.4 -2.7 -0.4 0.3 0.04 0.3 0.04

RO: Romania 0.0 0.0 0.0 0.0 0.0 0.0 0.0 0.0

UK: United Kingdom 0.0 0.0 0.0 0.0 0.0 0.0 0.0 0.0

Sources: Interviews and Eurostat.

The likely change in the number of cases as a result of revisions to the EU provisions will also be experienced by the national administrations of previous employment. Table 3-7 shows our estimates/assumptions for these likely changes – which are limited apart from for Romania.

Task 2: Administrative costs of handling aggregation of periods or salaries for unemployment benefits

Table 3-7 Change in number of aggregation of unemployment benefit cases handled by national administrations as authority of previous employment

Member State Option 2a Option 2b Option 3a Option 3b

DE: Germany -1.0% -1.2% 0.0% 0.0%

DK: Denmark -1.2% -1.6% 0.1% 0.1%

NL: Netherlands -1.2% -1.5% 0.0% 0.0%

PL: Poland -3.4% -4.4% -1.3% -1.7%

RO: Romania -6.6% -8.6% -2.8% -3.6%

UK: United Kingdom -1.4% -1.9% 0.0% 0.0%

Sources: FGB et.al. (2015): Annex 2 - Table 2.3 and Table 2.4.

For completeness, Table 3-8 shows the results adjusted for such possible changes in the number of cases. This does not change the conclusion that the changes are expected to be minor.

Table 3-8 Change in unit costs per case and total costs handling aggregation of unemployment benefit cases by national administrations as authority of previous employment – assuming changes in the number of cases

Member State Option 2a Option 2b Option 3a Option 3b

Total Total Total

Unit costs Unit costs

Total

Unit costs Unit costs

costs 1000 costs 1000 costs 1000 costs 1000 EUR EUR EUR EUR EUR EUR EUR EUR

DE: Germany 0.0 -0.1 0.0 -0.1 4.1 4.8 4.1 4.8

DK: Denmark 1.2 0.7 1.2 0.6 1.2 0.9 1.2 0.9

NL:

Netherlands 0.0 -0.2 0.0 -0.2 0.0 0.0 0.0 0.0

PL: Poland -2.7 -0.4 -2.7 -0.4 0.3 0.03 0.3 0.02

RO: Romania 0.0 -0.4 0.0 -0.5 0.0 -0.2 0.0 -0.2

UK: United

Kingdom 0.0 0.0 0.0 0.0 0.0 0.0 0.0 0.0 Sources: FGB et.al. (2015): Annex 2 - Table 2.3 and Table 2.4, Eurostat and interviews.

1.14. Mobile EU-workers and their families

The interviews carried out in the six case study Member States indicate that the proposed revisions to the EU provisions may well have implications for the mobile EU-workers and their families. Although it may not be considered as administrative implications, some interviewees envisage that Option 2a and Option 2b may have a negative impact on the exercise of free movement, because a more complex legislation may discourage workers who were planning to move to another Member State.

Task 2: Administrative costs of handling aggregation of periods or salaries for unemployment benefits

Conclusions

Revising the current rules for aggregation of unemployment periods specified in Regulation (EC) No 883/2004 i will have impact on the administrative costs and burden of the national administration in the Member States handling cases where mobile EU- workers apply for unemployment benefits – both in the Member States of last employment of the applicant and in those of previous employment of the applicant. Furthermore, the applying EU-workers and their families will experience changes in the own administrative burden from the revisions. The overall conclusion from this study is, however, that the impacts are expected to be limited – a conclusion that is based on assessments made in six case study Member States: Germany, Denmark, the Netherlands, Poland, Romania, and the UK.

Change in administrative costs and burden for national administrations acting as authority of last employment

Currently, the national administrations in the case study Member States use on average less than 1.5 man-hours per case, most of which is used for the collection of information from Member States of previous employment about the applicants' employment and insurance histories, followed by resources spent on the calculation of the unemployment benefit payments. The man-hour use is fairly similar in between the case study Member States, and there is no tendency to that high labour cost Member States such as Denmark and the Netherlands carry out the administrative tasks using less manpower than low labour cost Member States such as Poland and Romania.

This study assesses that the administrative tasks will be almost unchanged if it is decided to implement Option 2a or Option 2b – i.e. to introduce a threshold for the period of insurance or employment to be completed in the Member State of last employment before the aggregation principle applies. If Options 2a and 2b are modified/extended to make the Member State of previous employment responsible for paying unemployment benefits for those workers who have not completed the required period of insurance or (self-)employment in the Member State of last employment, there will be an additional need for the latter national administration to inform the former about this situation. Although the interviewees have not assessed the administrative burden of doing this, we would expect this to a minor additional task as the national administration of last employment in any case is in contact with the national administration of previous employment regarding the exchange of information about the given applicant.

For Options 3a and 3b – i.e. taking into account the salary earned in the Member State of previous employment in the unemployment benefit calculation – it is assessed that each

Task 2: Administrative costs of handling aggregation of periods or salaries for unemployment benefits

increase is caused by the need to collect information as the salary earned in the Member State of previous employment and to use this in the calculation of the unemployment benefit payment.

Task 2: Administrative costs of handling aggregation of periods or salaries for unemployment benefits

Change in administrative costs and burden for national administrations acting as authority of previous employment

Currently, the national administrations in the case study Member States use on average less than one man-hour per case, with almost all time spent on the standard administrative task of providing information – i.e. to respond to a request from a Member State of last employment regarding an applicant's insurance and employment history. There is, however, some variation in the average time spent in between the case study Member States. In particular, the unemployment funds in Romania spend much time responding to a request for information about an applicant's previous insurance and employment history. At the other end, the UK does not see that of being the authority of previous employment involving much work.

Similar to for the national administrations of last employment, Option 2a and Option 2b will not make almost no changes to the administrative tasks of the national administrations when acting as authority of previous employment. However, if Options 2a and 2b are modified/extended to make the Member State of previous employment responsible for paying unemployment benefits for those workers who have not completed the required period of insurance or (self-)employment in the Member State of last employment, the national administration of previous employment will have two new administrative tasks. Firstly, there will be a minor task of receiving and registering the information about the situation. Secondly, the national administration will calculate the benefits that the applicant is entitled to according to its national legislation. Our best estimate of the additional administrative burden of this is the time estimates provided by the national administrations of last employment for their similar tasks. Hence, based on their we assess that the national administration of previous employment will spent around 20 minutes extra for each case where it becomes responsible for paying the unemployment benefits.

This assessment of limited impacts goes, however, also for Options 3a and 3b when having the role as authority of previous employment.

Change in administrative costs and burden for mobile EU-workers and their families

Task 2:

Administrative costs of handling aggregation of periods or salaries for unemployment benefits

Task 2:

Administrative costs of handling aggregation of periods or salaries for unemployment benefits

Annex A – Literature

EC (2009), Impact Assessment Guidelines, http://ec.europa.eu/smartregulation/impact/commission_guidelines/docs/iag_2009_en.pdf

EC (2015), Commission staff working document, Better Regulation Guidelines, SWD(2015) 111 final, http://ec.europa.eu/smartregulation/guidelines/docs/swd_br_guidelines_en.pdf

Eurostat database, http://ec.europa.eu/eurostat/data/database

FGB, COWI and IER (2015), Task 4, Draft Final Report, 31 July 2015.

Pacolet, J and F De Wispelaere (2015), Aggregation of periods for unemployment – Report on U1 portable documents for migrant workers, June 2015.

Task 2: Administrative costs of handling aggregation of periods or salaries for unemployment benefits

Annex B – Interview guide

The attached interview guide is the actual version used for the interviews in the UK, and is so in English. The interview guide was provided to the Member States experts in their national languages.

Note that we in the interview guide make use of the option titles: Revisions (A), (B), (C), and (D), rather than Options 2a, 2b, 3a, and 3b – as in the report. The reason for this was to avoid discussing what happened to Option 1.

Task 2: Administrative costs of handling aggregation of periods or salaries for unemployment benefits

EUROPEAN COMMISSION, DG EMPLOYMENT, SOCIAL AFFAIRS AND INCLUSION

Study to analyse and assess the impacts of policy options for a possible EU initiative in

the area of coordination of social security schemes, in particular with regard to the

revision of the current EU provisions on entitlement to unemployment benefits and

export of family benefits

Interview guide:

National administrations handling unemployment benefits

European Commission, Directorate General for Employment, Social Affairs and Inclusion has given Fondazione Brodolini, COWI and IER the task to assess changes to administrative/compliance costs within national administrations and for the individuals affected that might occur from possible revision of the current EU provisions on unemployment benefits specified in Regulation (EC) 883/2004 i: the 'Basic Regulation' and in Regulation (EC) 987/2009 i: the 'Implementing Regulation'.

In this interview, we focus on the case handling of applications for unemployment benefits where the aggregation principle apply. I.e. applications from citizens having moved from one Member State to another to work who have become unemployed before the qualifying period in the competent Member State has been completed. In this interview guide we refer to these citizens as mobile EU workers.

More precisely, we aim to assess changes in the administrative/compliance tasks and consequently costs of introducing a threshold of one to three months of insurance in the competent Member State before the aggregation rule applies. Furthermore, we want to assess changes in the administrative costs of introducing a rule that states that wages earned in a previous Member State should also be taken into account when the calculating unemployment benefits if less than one or three months of insurance or (self) employment is completed in the competent State. Finally, we aim to assess whether the unemployed receiving the benefits will face changing administrative/compliance tasks.

Hence, we would like to arrange the time and place for an interview; and for you to get more insight into the questions we would like to ask you – we hereby provide you with our interview guide.

You may well find that you are not able to answer all the questions. We will therefore focus on the questions you can answer – but you may also be able to help us pointing to the other services in your national administration that can help us answering the remaining questions.

April 2015

Task 2: Administrative costs of handling aggregation of periods or salaries for unemployment benefits

5.

You and your national administration

Name and title of interviewee:

_______________________________________________

National administration:

_______________________________________________

Function/responsibility of interviewee:

_______________________________________________

6.

Current administrative tasks and consequently costs of handling unemployment benefits

In this section, we ask you to verify and estimate the costs of a number of administrative tasks that are currently carried out when handling a case of unemployment benefits. Imagine a case as described by the following example:

Example 1 of unemployment benefits :

Carlos moves from Member State A to Member State B and works there for two weeks before

becoming unemployed. Currently, he can claim unemployment benefits in Member State B based on his period of insurance in Member State A.

We do the assessment in two parts. Firstly, we ask you to assess a situation when you are the competent national administration – i.e. where you deal with the applicant for unemployment benefits. Secondly, we ask you to assess a situation where you are the national administration of a previous Member State of employment – i.e. where you deal with the follow-on administrative tasks from an application submitted in another Member State.

If you only carry out one of the two types of administrative tasks – please leave out the other part.

6.1. Administrative tasks/costs – when competent national administration

Consider the situation, where you are the competent national administration.

Firstly, please provide your assessment of the number of cases handled by your institution.

 How many cases of application for unemployment benefits from Mobile EU workers do your institution

currently handle per year as the competent national administration:

Task 2: Administrative costs of handling aggregation of periods or salaries for unemployment benefits

c)

New cases?

d)

Existing active cases?

 How do you collect data?

c)

From other member states?

d)

From the applicant?

When answering these questions please explain whether you collect information via IT-systems, via records of personal registration etc.

Secondly, please provide, with an outset in the below table, your assessment of the current administrative costs in terms of average man-hours of handling one case of application for unemployment benefits from a mobile EU worker, being the competent national administration. (You may relate the tasks to the SEDs to be filled out). Hence:

 Please assess the frequency of each of the detailed administrative tasks – i.e. how often are the tasks carried out in a case of application for unemployment benefits from a mobile EU worker? 100 % means that the task is always carried out, while 50 % means it is carried out in half of the cases.

And in this context – is it appropriate to distinguish between "standard tasks" and "additional tasks"?

Administrative Description of administrative task Average Comments

task - hereunder frequency of tasks within a case man-hours/

minutes

Standard administrative tasks

Collecting Please revise (if necessary): information

Determine whether the information provided by the

applicant is sufficient to decide on the payment of unemployment benefits. Obtain information from other previous Member State(s) of insurance about insurance and employment history in this/these country(-ies).

Please specify/revise frequency when you are the competent national administration:

Frequency, when you are the competent national administration: %

Task 2: Administrative costs of handling aggregation of periods or salaries for unemployment benefits

Administrative Description of administrative task Average Comments

task - hereunder frequency of tasks within a case man-hours/

minutes

Calculation of Please revise (if necessary): Comments: benefit

For each of those cases where you are the competent

national administration: You calculate the benefit which the claimant is entitled to under the national legislation. You set the payment of unemployment benefits in motion .

Please specify/revise frequency when you are the competent national administration:

Frequency, when you are the competent national administration: 100%

Additional administrative tasks

Determination of Please revise (if necessary): Comments: residence

If the State of residence is not readily overt determination of residence needed to determine whether the applicant is eligible for unemployment benefits under the national legislation : Additional costs

arise as a result of collecting additional informa tion about e.g. family ties, housing situation, characteristics of the candidate's professional activities.

Please specify frequency out of total number of cases when you are the competent national administration:

Frequency: ___%

Change in Please revise (if necessary): Comments:

circumstances

If circumstances change and it leads to a change of who is the competent Member State, a re-calculation of

benefits or revaluation of competent state is performed: Determine what type of change it is - whether it will lead to a re-calculation of benefits or change in competence.

Please specify frequency out of total number of cases when you are the competent national administration:

Frequency: ___%

Reimbursement Please revise (if necessary): Comments:

If (provisional) unemployment benefits awarded to a

Mobile EU worker should have been paid by another Member State: Additional costs arise from reimbursement activities.

Please specify frequency out of total number of cases when you are the competent national administration:

Frequency: ___%

Task 2: Administrative costs of handling aggregation of periods or salaries for unemployment benefits

Administrative Description of administrative task Average Comments

task - hereunder frequency of tasks within a case man-hours/

minutes

Recovery Please revise (if necessary): Comments:

If an applicant unjustified has received unemployment

benefits (i.e. it has been determined, that you are not the competent state after all): Additional costs arise from determining whether there is a basis for recovery, from calculation of benefits to recover, and from

contacting the competent Member States to seek recovery.

Please specify frequency out of total number of cases when you are the competent national administration:

Frequency: ___%

Missing administrative tasks

Please add Comments:

missing task

Please add Comments: missing task

Please estimate your total use of man-hours per case

6.2. Administrative costs – when national administration in a Member State of previous insurance of a mobile EU worker

Now, consider the situation, where you are the national administration in a Member State of previous insurance of a mobile EU worker – i.e. you receive a request for information from another Member State.

Firstly, please provide your assessment of the number of cases handled by your national administration.

 How many cases of application for unemployment benefits from mobile EU workers do your institution

currently handle per year as the national administration in a Member State of previous insurance of a mobile EU worker?

c)

New cases?

d)

Existing active cases?

Secondly, please provide, with an outset in the below table, your assessment of the current administrative costs of handling one application for unemployment benefits from a mobile EU worker, being the national administration in a Member State of previous employment of a mobile EU worker. (You may relate the tasks to the SEDs to be filled out). Hence:

 Please assess the frequency of each of the detailed administrative tasks – i.e. how often are the tasks carried out for a given case?

Task 2: Administrative costs of handling aggregation of periods or salaries for unemployment benefits

And in this context – is it appropriate to distinguish between "standard tasks" and "additional tasks"?

Administrative Description of administrative task Average Comments

task - hereunder frequency of tasks within a case man-hours/

minutes

Standard administrative tasks

Providing Please revise (if necessary): Comments:

information

You receive a request for information about an

applicant's previous insurance and employment history in your State from another Member State concerning an application for unemployment benefits and you contribute with the required information.

Please specify frequency when you are a Member State of previous insurance:

Frequency: 100%

Additional administrative tasks

Determination of Please revise (if necessary): Comments: residence

If the State of residence is not readily overt determination of residence needed to determine whether

the applicant is eligible for unemployment benefits under the national legislation : Additional costs arise as a result of providing additional informa tion about candidate’s professional activities.

Please specify frequency out of total number of cases when you are a Member State of previous insurance:

Frequency: ___%

Change in Please revise (if necessary): Comments: circumstances

If circumstances change and it leads to a change of who

is the competent Member State and you are determined the competent institution: Additional costs arise a calculation of benefits is performed.

Please specify frequency out of total number of cases when you are a Member State of previous insurance:

Frequency: ___%

Task 2: Administrative costs of handling aggregation of periods or salaries for unemployment benefits

Administrative Description of administrative task Average Comments

task - hereunder frequency of tasks within a case man-hours/

minutes

Reimbursement Please revise (if necessary): Comments:

If (provisional) unemployment benefits awarded to a mobile EU worker should have been paid you, but another Member State has done this: Additional costs arise from reimbursement activities.

Please specify frequency out of total number of cases when you are a Member State of previous insurance:

Frequency: ___%

Recovery Please revise (if necessary): Comments:

If an applicant, who belongs to your institution has

unjustified received unemployment benefits in another Member State: Additional costs arise recovery activities.

Please specify frequency out of total number of cases when you are a Member State of previous insurance:

Frequency: ___%

Missing administrative tasks

Please add missing Comments:

task

Please add missing Comments: task

Please estimate your total use of man-hours per case

7.

Change in administrative costs of handling unemployment benefits from revisions to EU provisions

In this section, we then ask you to assess the likely increase or decrease in administrative tasks/costs within your national administration from possible revisions to the EU provisions.

We acknowledge that this may be even more difficult than estimating the current use of man-hours in the previous section – in particular if the revisions lead to new administrative tasks.

Please do this assessment for each of the possible revisions one by one. We firstly ask you to assess the revisions assuming you are the competent national administration, and secondly we ask you to assess the revisions assuming you are the national administration in a Member State of previous employment of a mobile EU worker. However, if you only carry out one of the two types of administrative tasks – please leave out the other.

Task 2: Administrative costs of handling aggregation of periods or salaries for unemployment benefits

Revision (a):

A threshold of one month of insurance or (self-) employment needs to be completed before aggregation of periods of insurance, employment or self-employment fulfilled in another Member State can be applied.

Example A of new situation:

Carlos becomes entitled to unemployment benefits in Member State A based on his insurance periods in Member State B only after completion of at least one month of unemployment

insurance in Member State A.

 Please fill in the table in section 4.1 below.

Revision (b):

A threshold of three months of insurance or (self-) employment needs to be completed before aggregation of periods of insurance, employment or self-employment fulfilled in another Member State can be applied.

Example B of new situation :

Carlos becomes entitled to unemployment benefits in Member State A based on his insurance periods in Member State B only after completion of at least three months of unemployment insurance in Member State A.

 Please fill in the table in section 4.1 below.

Revision (c):

The salary earned in the previous Member State is also taken into account for the calculation of the unemployment benefit by the competent Member State, if less than one month of insurance or (self-) employment is completed. The calculation is made within a national reference period.

Example C of new situation:

Carlos becomes entitled to unemployment benefits in Member State A after only one day of insurance in Member State A, but, as he has been employed for less than one month in

Member State A, the institution in Member State A also takes his salaries earned in Member State B into account for the calculation of the amount.

 Please fill in the table in section 4.1 below.

Revision (d):

The salary earned in the previous Member State is also taken into account for the calculation of the unemployment benefit by the competent Member State, if less than three months of insurance or (self-)

employment is completed. The calculation is made within a national reference period.

Example of new situation :

Carlos becomes entitled to unemployment benefits in Member State A after only one day of insurance in Member State A, but, as he has been employed for less than three month in Member State A, the institution in Member State A also takes his salaries earned in Member State B into account for the calculation of the amount.

 Please fill in the table in section 4.1 below.

Task 2: Administrative costs of handling aggregation of periods or salaries for unemployment benefits

7.1. Change in administrative tasks – when competent national administration

Consider the situation, where you are the competent national administration – i.e. the national administration sending request for information to (an)other Member State(s).

Please provide a brief narrative explanation for each of the assessed changes and new administrative tasks.

Administrative task Change in use of case handling time of administrative tasks due possible revisions

of unemployment benefit provisions

Please provide change in average man-hours/minutes or % increase/decrease

Revision (a) Revision (b) Revision (c) Revision (d)

Standard administrative tasks

Collecting information Change: Change: Change: Change:

Explanation: Explanation: Explanation: Explanation:

Calculation of benefit Change: Change: Change: Change:

Explanation: Explanation: Explanation: Explanation:

Additional administrative tasks

Determination of Change: Change: Change: Change: residence

Explanation: Explanation: Explanation: Explanation:

Change in Change: Change: Change: Change: circumstances

Explanation: Explanation: Explanation: Explanation:

Reimbursement Change: Change: Change: Change:

Explanation: Explanation: Explanation: Explanation:

Recovery Change: Change: Change: Change:

Explanation: Explanation: Explanation: Explanation:

Task 2: Administrative costs of handling aggregation of periods or salaries for unemployment benefits

Administrative task Change in use of case handling time of administrative tasks due possible revisions of unemployment benefit provisions

Please provide change in average man-hours/minutes or % increase/decrease

Revision (a) Revision (b) Revision (c) Revision (d)

Missing (current) administrative tasks [added in the previous section]

Please add missing Change: Change: Change: Change: task

Explanation: Explanation: Explanation: Explanation:

Please add missing Change: Change: Change: Change:

task

Explanation: Explanation: Explanation: Explanation:

New administrative tasks – due to the revision

Please add new task Man-hours/minutes: Man Man Manhours/minutes: hours/minutes: hours/minutes:

Explanation: Explanation: Explanation: Explanation:

Please add new task Man-hours/minutes: Man Man Manhours/minutes: hours/minutes: hours/minutes:

Explanation: Explanation: Explanation: Explanation:

7.2. Change in administrative costs – the national administration in a Member State of previous insurance of a mobile EU worker

 Please repeat the assessment of the change in the administrative costs associated with the case handling for each of the revisions (a), (b), (c) and (d).