Changes to Kela benefits in 2020
The calculation rules for National Health Insurance daily allowances will be modified and the unemployment activation model discarded. Benefits linked to the national pensions index will be raised by 1.0%, and a general increase will be applied to many other benefits. These changes will become effective on 1 January 2020.
The following is a summary of the key changes in 2020 which affect the social benefits provided by Kela. Information about the changes and the new euro amounts of benefits will be made available at www.kela.fi on 1 January 2020.
Increases in family benefits
The minimum amounts of the maternity, special maternity, paternity and parental allowances will be increased to EUR 28.94 per day (from EUR 27.86 in 2019).
The child benefit for the fourth and each subsequent child will be raised by EUR 10 per month. Also the single-parent supplement will be increased to EUR 63.30 per month (from EUR 53.30 in 2019).
The euro amounts of child care allowances tied to the national pensions index will go up 1.0%.
Rates of the child maintenance allowance increased
The full amount of the child maintenance allowance will be increased to EUR 167.01 per month (from EUR 158.74 per month in 2019).
The income limits to qualify for an exemption on child support debt will be revised. Persons with maintenance liabilities qualify for the exemption if their monthly income does not exceed EUR 1,128.57. The income limit is raised by EUR 282.14 per month for each minor child, with the exception of children for whom a child maintenance allowance has been awarded. The 2019 amounts were EUR 1,120.00 per month and EUR 280.00 per month.
Kela does not provide child maintenance allowance if a child is able to support him- or herself. In 2020, the limits for children’s earnings and income from capital will be increased to EUR 790.00 per month for children living at home, and to EUR 1,128.57 per month for children who are living independently. The corresponding limits in 2019 were EUR 784.00 per month and EUR 1,120.00 per month.
Daily allowances for parents will be calculated on the basis of annual income
Starting 1 January 2020, the daily allowances payable to parents will be calculated on the basis of annual income. The annual income is calculated for a reference period of 12 calendar months prior to the month that precedes the start of the entitlement to the allowance. This means that there is a gap of one month between the end of the reference period and the start of payment of the daily allowance. An exception to this are situations where a person becomes entitled to an allowance in January 2020, in which case the annual income is calculated for the period 1 January 2019–31 December 2019.
Included in the annual income are wages and salaries, salaries for insurance purposes, earned income under the self-employed persons' (YEL) and farmers' (MYEL) pension insurance schemes, certain compensations for loss of income, and a number of social benefits including unemployment benefits, sickness allowance and study grants. The annual income may consist of several sources of income, such as salaries and social benefits. Kela typically obtains the necessary data from the national incomes register and from insurance providers.
Also after the changes described above, the allowances for parents may continue to be determined on the basis of the income that was the basis for a previous allowance if the expected due date of the new child occurs before a previous child reaches the age of 3 years.
Under certain conditions, applicants can request that their allowance is calculated on the basis of their income for the final three months of the reference period consisting of 12 calendar months. This is the case for example if an applicant has, during the reference period, acquired a basic vocational qualification, completed higher education or has spent time on child care leave. A further requirement is that the income for 3 months multiplied by 4 is at least 20% higher than the annual income determined on the basis of the 12-month reference period.
If an applicant has no or only very little income for the 12-month reference period, the allowance will be at least a specified minimum amount (EUR 28.94 per day in 2020).
Changes to student financial aid
The provider supplement to the study grant will be increased by EUR 25 and will be EUR 100 per month starting from January 2020.
Also starting from January, all students who study abroad and live in rental accommodation can receive a housing supplement of EUR 210 per month. Previously, the housing supplement was smaller for students in certain former Eastern bloc countries.
Kela will adjust the provider supplements and housing supplements automatically. Students who will receive more aid will receive a new decision on their financial aid in December.
The annual income limits for the recipient’s own income are raised every second year in line with the change in wages. Accordingly, the income limits for the financial aid years 2020 and 2021 will be increased by 4.5%.
The deadline for voluntary repayment of student financial aid will be shortened by one month. Repayments of student financial aid concerning the year 2019 must be made by 30 April 2020. This is due to taxation deadlines.
The activation model will be abolished at the turn of the year
Implementation of the activation model will end on 1 January 2020. Kela and the unemployment funds will no longer track the activity of unemployed persons or make reductions to their benefits. Any unemployment benefits that were reduced on account of the activation model will automatically revert to their normal level on 1 January 2020.
However, the activation model will continue to affect unemployment benefits that have accrued in 2019, even though the date of payment is in 2020.
Unemployment benefits increased
The basic unemployment allowance and the labour market subsidy will increase to EUR 33.66 per day (from EUR 32.40 in 2019).
The supplementary amount and the child increases will be raised as well. The supplementary amount will be EUR 4.79 per day.
The child increases will be as follows:
- EUR 5.28 per day for one child
- EUR 7.76 per day for two children in total
- EUR 10.00 per day for three or more children in total
Age limit for additional days of unemployment allowance raised
The age limit to qualify for additional days of unemployment allowance will be raised from 61 to 62 years for those born in 1961 or later. The eligibility for additional days of unemployment allowance means that the payment of basic and earnings-related unemployment allowance can continue past the normal limit until the recipient retires.
While the effective date of this change is 1 January 2020, the practical impacts will not be felt until 2022 when those born in 1961 will reach the age of 61 years.
General housing allowance: Maximum housing costs increased slightly
The maximum housing costs allowed under the general housing allowance scheme will be adjusted in line with the cost-of-living index. This means that the maximum housing costs will be increased slightly at the beginning of 2020. The new maximum limits will apply to all reviews and awards of housing allowance made on or after 1 January 2020.
Due to an adjustment of the national pensions index, the basic deductible applicable to housing allowance recipients is reduced somewhat. This means that the income limit to qualify for a full housing allowance will go up slightly. In 2020, the full rate of allowance is available on an income of EUR 603 plus EUR 100 for each adult and EUR 223 for each child in the household.
Increase in the basic amount of social assistance
The basic amount of social assistance will increase slightly in 2020. It will be EUR 502.21 per month for persons living alone, up from EUR 497.29 per month in 2019.
The basic amount of the single-parent supplement will be increased as a separate measure. In 2019, it was EUR 547.02 per month (basic amount for persons living alone + 10%), and in 2020, it will go up to EUR 572.52 per month (basic amount for persons living alone + 14%).
Maximum limit on out-of-pocket medicine costs increased
The maximum limit on yearly out-of-pocket medicine costs will go up slightly. The new limit will be EUR 577.66 per calendar year (up from EUR 572 in 2019). Once the limit is reached, customers only pay a EUR 2.50 copayment for each reimbursable medicine for the rest of the year.
The basic rate of reimbursement (40% of the sale or reference price), the lower special rate of reimbursement (65% of the sale or reference price) and the higher special rate of reimbursement (100% of the sale or reference price) will remain the same. Also the initial deductible (EUR 50) which customers must pay out of pocket to qualify for reimbursements will remain unchanged.
Pharmacies will be notified immediately when a customer has reached the maximum limit
Starting 1 January 2020, Kela will notify pharmacies immediately when a customer reaches the maximum limit on out-of-pocket medicine costs. This means that customers no longer have to apply to Kela for an additional reimbursement for medicines they purchase after reaching the maximum limit but can get it directly at the pharmacy.
Minimum amounts of sickness and rehabilitation allowances increased
The minimum amounts of sickness and rehabilitation allowances will go up to EUR 28.94 per day (from EUR 27.86 in 2019).
Also the rehabilitation allowance for young persons and the allowance payable during vocational rehabilitation will be increased. They will be EUR 33.39 per day (EUR 31.39 in 2019).
Sickness and rehabilitation allowances will be calculated on the basis of annual income
Starting 1 January 2020, the sickness and rehabilitation allowances will be calculated on the basis of annual income. The annual income is calculated for a reference period of 12 calendar months prior to the month that precedes the start of entitlement. This means that there is a gap of one month between the end of the reference period and the start of payment of the daily allowance.
An exception to this are situations where a person becomes entitled to an allowance in January 2020, in which case the annual income is calculated for the period 1 January 2019–31 December 2019.
Included in the annual income are wages and salaries, salaries for insurance purposes, earned income under the self-employed persons' (YEL) and farmers' (MYEL) pension insurance schemes, certain compensations for loss of income, and a number of social benefits including unemployment benefits, sickness allowance and study grants. The annual income may consist of several sources of income, such as salaries and social benefits. Kela typically obtains the necessary data from the national incomes register and from insurance providers.
Under certain conditions, applicants can request that their allowance is calculated on the basis of their income for the final three months of the reference period consisting of 12 calendar months. This is the case for example if an applicant has, during the reference period, acquired a basic vocational qualification, completed higher education or has spent time on child care leave. A further requirement is that the income for 3 months multiplied by 4 is at least 20% higher than the annual income determined on the basis of the 12-month reference period.
If an applicant has no or only very little income for the 12-month reference period, the allowance will be at least a specified minimum amount (EUR 28.94 per day in 2020).
New type of neuropsychiatric rehabilitation for children and adolescents
Starting in spring 2020, Kela will begin to provide access to long-term neuropsychiatric family rehabilitation intended for children and adolescents aged 5–15 years and their families. The rehabilitation is for children and adolescents diagnosed with a neuropsychiatric disorder such as ADHD, autism spectrum disorder or Tourette syndrome.
OPI rehabilitation supporting occupational work capacity becomes more widely available to young people
Developed for persons undergoing vocational education, OPI rehabilitation will be available in a wider range of educational institutions. Starting 1 January 2020, the programme will cover as many as 25 educational institutions around Finland. OPI rehabilitation is intended for students between 16 and 29 who are completing a vocational qualification or attending upper secondary school. It provides support with studies, depressive symptoms and general life management. Learn more >
Increases in pensions
The full amount of the national pension for recipients living alone will be EUR 662.86 per month (up from EUR 628.85 in 2019). The corresponding amount for those living together with another person will be EUR 591.79 per month (up from EUR 557.79 in 2019).
The full amount of the guarantee pension and of pension assistance will be EUR 834.52 per month (EUR 784.52 per month in 2019).
The starting pension for surviving spouses will be EUR 327.54 per month, and the basic amount of the continuing pension EUR 102.00 per month. The basic amount of the orphans' pension will be EUR 60.27 per month.
The increase available to pensioners with a dependent child under 16 years of age will be EUR 22.15 per month.
The front-veterans’ supplement will be EUR 50.68 per month in 2020, while the additional front-veterans' supplement will be EUR 257.19 per month for recipients living alone and EUR 225.21 per month for those living together with another person.
The earnings limit for putting a disability or guarantee pension on hold will go up as well. Recipients of a disability pension can in 2020 earn a maximum of EUR 834.52 per month without any effect on the further payment of the disability pension or guarantee pension.
Changes in the housing allowance for pensioners
The maximum housing costs taken into account in the housing allowance for pensioners will be increased by 1.4% in all three municipality categories.
The maximum amount of housing costs will be
- EUR 8,360 per year in category 1 municipalities
- EUR 7,688 per year in category 2 municipalities
- EUR 6,745 per year in category 3 municipalities.
The recognised monthly costs of maintenance for a single-family home will increase to EUR 43.28 from EUR 42.85 in 2019. An amount ranging between EUR 1.32 and EUR 1.60 per month and square metre (depending on the municipality of residence) will be recognised as heating costs. Recognised water charges are unchanged. These increases will be applied in forthcoming reviews of the housing allowance for pensioners.
The income limits and percentage value of the additional deductible assessed with the care allowance for pensioners will also change at the turn of the year. The additional deductible will be equal to 41.3% of income exceeding a specified limit.
The following income limits will apply in 2020:
- for persons living alone, EUR 9,300 per year
- for persons who are married or cohabiting or live in a registered partnership and whose spouse or partner is not eligible for a housing allowance, EUR 13,341 per year
- for persons who are married or cohabiting or live in a registered partnership and whose spouse or partner is eligible for a housing allowance, EUR 15,184 per year.
Increases in disability benefits
Disability benefits will be increased slightly starting 1 January 2020 in line with index adjustments:
Disability allowance for persons under age 16
- basic disability allowance EUR 93.05 per month
- increased disability allowance EUR 217.13 per month
- highest disability allowance EUR 421.03 per month
Disability allowance for persons aged 16 years or over
- basic disability allowance EUR 93.05 per month
- increased disability allowance EUR 217.13 per month
- highest disability allowance EUR 421.03 per month
Care allowance for pensioners
- basic care allowance EUR 71.21 per month
- increased care allowance EUR 155.15 per month
- highest care allowance EUR 328.07 per month
- disability supplement for veterans EUR 107.49
Earnings threshold to qualify for social security coverage will be increased for persons employed in Finland
Workers arriving in Finland from another country may be eligible for social benefits from Kela. They are eligible if they earn at least EUR 723.69 per month (up from EUR 696.60 per month in 2019). This corresponds to the amount of the basic unemployment allowance per month. Benefits are available for months in which the threshold is exceeded.
Additional information for customers
Rates of benefit and income limits starting 1 January 2020