Benefit agency: Chaotic new unemployment scheme error prone

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The UWV benefits agency expects chaos once the new unemployment scheme takes effect on July 1st. People who become unemployed after July 1st will have to declare the money they make before receiving unemployment benefits. According to the UWV, reporting his income is so complicated that everyone who has do deal with it will make mistakes, Trouw reports.

This new scheme forms part of the Work and certainty act devised by the Ministry of Social Affairs. In the current system, it is usually not financially attractive for people to work for a lower salary than the unemployment benefit they receive from their previous jobs. From July 1st, someone on an unemployment benefit can keep 30 cents of each euro he earns on top of his benefit. Minister Lodewijk Asscher hopes that this will stimulate unemployed people to find work.

The testing of the new system revealed that 99 percent of participants completed the formula incorrectly.  The formula is very complicated, according to UWV director Fred Paling. "In the testing phase we discovered that no one knows what the si-wage is." he said to Trouw. The si-wage, or social insurance wage, is the salary on which contributions for social insurance is calculated. Unemployed people will have to inform the UWV of this wage every month. But the si-wage can not be found under that name on almost all payslips. Sometimes it isn't even on the payslips at all. Which means that the unemployed person will have to calculate it himself. They will also need additional information such as their holiday bonus, shift allowance or year end bonuses. "We assume that in the first month everyone will get it wrong.

Unemployed people will have to report their income every month, and therefor report any change in the si-wage. They also have to report it if there were no changes.

The UWV expects that around 60 thousand people will become unemployed in July and will apply for their unemployment benefits from August 1st. A total of 5 million euros have been used on information campaigns and for 100 extra employees at the UWV to assist with the changes from July 1st. But given the expected difficulties, the entire staff of the UWV helpdesk will have to work on the weekend of August 1st and 2nd.

Paling also warns people to take into account that the new system will mean that first unemployment benefits will pay out a few weeks later than is currently the case. The first unemployment benefit payment may take up to six weeks.