Minimum Income Schemes in Central and Eastern Europe: A Comparative Analysis of Selected Institutional Features

Abstract

This paper focuses on the question ‘to what extent do minimum income schemes guarantee adequate protection to people in need in the new EU countries of Central and Eastern Europe (CEE). These countries are special cases as they had to build their social security systems while undergoing intensive change from a command to a market economy. Moreover, on being confronted by the emergence of poverty, the existing safety nets had to be strengthened and focused more on the poor. The policy evaluation presented in this article provides an overview of institutional patterns of the minimum income schemes framed by the model of welfare production put forward by Hill and Bramley (1986). The focus is on aspects such as ‘coverage’, ‘adequacy’, and ‘target effectiveness’ influencing the final ‘power in terms of poverty alleviation of the benefits. The results show that minimum income schemes differ with regard to the studied dimensions and two groups of countries can be distinguished. The Czech Republic, Slovenia, and Slovakia have relatively effective schemes influenced by wide legal coverage, somewhat generous benefits and higher target effectiveness. In the Baltic States and Poland, the combination of rather extensive legal coverage (with the exception of Poland, where restrictions are applied) with lower benefit levels and weak target effectiveness leads to lower capacity of the schemes with regard to poverty alleviation.