2024-04-13 19:59:31
The rise in the cost of living, driven by the increase in credit rates and the value of rents, is not compatible with the portfolios of those earning the lowest salaries in the Grand Duchy. Those who earn the minimum social wage (SSM) cannot “live in a dignified way”, warn the unions. An alarming situation that leads the OGBL and the LCGB to demand an increase in SSM in the country.
The gross non-qualified minimum social wage is currently 2,570.93 euros, a value that for the two trade unions is insufficient to cover all expenses.
Deducting taxes and contributions, the worker is left with a net unskilled SSM of 2,183.95 euros, Christophe Knebeler, deputy general secretary of the LCGB, highlights to Contacto.
An amount that is below the poverty threshold in Luxembourg and below the reference value established by Statec for a “normal life”, Nora Back, president of OGBL, tells Contacto.
Both unionists argue that the unskilled SSM must be increased. Christophe Knebeler explains that the poverty threshold is defined as “60% of averaged income”, that is, “2,247 euros net, for 2022”. Statec foresees a reference budget of “2. 437 euros net to allow a single person to live with dignity”.
Increase in social inequalities
For Nora Back, a “consequential increase in the minimum wage is necessary to reach these limits and to allow these workers to have a dignified life based on their salary”.
The LCBG trade unionist also emphasizes that the Luxembourg SSM “does not protect against poverty and does not guarantee a decent standard of living”.
“The middle class is increasingly poor in Luxembourg”
Both OGBL and LCGB express their concern about the increase in social inequalities in the country based on income.
Nora Back finds it “scary that Luxembourg has the highest at-risk-of-poverty rate among workers in the European Union”, while Christophe Knebeler recalls that the “working poor rate is 13.5% (2023), the highest in euro zone”.
OGBL and LCGB. Different measures
How should unqualified SSM be increased? Nora Back advocates a “10% increase”, at least. In this way, the gross SSM would rise to 2,828.02 euros.
Christophe Knebeler proposes a different solution. “Instead of asking for an increase in the gross amount of the social minimum wage, the LCGB asks that the SSM be completely exempt from taxes, the net amount would then be 2,286.84 euros, and that the tax credit policy be continued, which allows to increase the net income of the people concerned in a targeted way”, he explains.
Women are the biggest victims of soaring house prices
For the LCGB, it is necessary to increase the SSM tax credit, currently 70 euros net per month, paid directly by the employer to a worker who receives the SSM, so that it is no longer below the poverty risk threshold and comes as close as possible. possible from the STATEC reference budget”.
Single-parent families most affected
Both unionists also warn that among workers earning the minimum wage, single-parent families are particularly affected by low income.
“Single-parent families represent 18.1% of the population, the vast majority of which are women with dependent children. The at-risk-of-poverty rate for a single-parent family is 42.4%”, says Christophe Knebeler.
“Shame of poverty”. Only 20% of eligible residents request income assistance
For these families, the LCGB also asks for an increase in the single-parent tax credit, which is currently 2,505 euros/year for those who earn the SSM, in order to “give additional financial support to single-parent families”. It also requests that “the automatic allocation of the single-parent tax credit be provided, given that it currently has to be requested through a tax return”.
2024-04-13 19:59:31