Prague, April 5 (CTK) – The Czech government approved on Wednesday an amendment to lower social insurance payments for parents of two and more children from the current 6.5 percent to zero according to the number of offspring, Deputy PM Pavel Belobradek (Christian Democrats, KDU-CSL) has told reporters.
The cabinet of the Social Democrats (CSSD), ANO and the KDU-CSL) interrupted a debate on this amendment to the social insurance law due to the absence on the KDU-CSL ministers a week ago.
At present employees pay 6.5 percent of their pay base to social insurance.
According to the draft legislation, parents of two children would pay 5 percent and those with three children 2.5 percent. Mothers and fathers of four and more children would have to send nothing to the social insurance system.
Social insurance rates of the self-employed would decrease accordingly.
The government returned to the proposal after three months.
The Finance Ministry opposed it last December. Other sectors, employers and trade unions raised objections to the amendment as well.
Only one of the parents would apply the lower social insurance rate.
The Labour and Social Affairs Ministry estimates the number of people to use this benefit at some 730,000, that is about 13 percent of the working population.
The revenues of the social insurance system from which pensions are paid would decrease by 3.8 billion crowns.
However, Belobradek dismissed that the state would lose money.
“The money will stay in the pockets of the working parents who look after their children. This system is pointless for those who do not go to work,” he said.
The Labour and Social Affairs Ministry expects the legislation to boost birth rate.
The Finance Ministry criticises the proposed change as not systemic and half-baked that would deepen the budget deficit and raise red tape.