Spain approves minimum income for 2.3 mln poorest people

Spain's left-wing coalition government approved on Friday the creation of a minimum income worth 462 euros ($514) a month for its poorest people, whose financial fragility has been exacerbated by the coronavirus pandemic.

The scheme targets some 2.3 million people, Deputy Prime Minister Pablo Iglesias told a news conference. People aged 23 to 65 with assets of less than 16,614 euros, excluding house and discounted loans, will be eligible for the new scheme. As a result, average spending on fighting poverty in Spain should rise from just over 0.1% of GDP - one of the lowest levels in Europe - to practically equal the average of 0.4% for OECD peer countries, the government said.

Under the decree approved at a cabinet meeting, the government would pay the monthly stipend and top-up existing revenue for people earning less so that they get at least that minimum amount every month, Iglesias said. The new program will include incentives for finding a formal job, Iglesias said.

"We'll be successful if we are able to help the identified households to transition to a better place in society," Social Security Minister Jose Luis Escriva told the same briefing. The minimum income would increase with the number of family members to a total of up to 1,015 euros per month. The new program aims to reach 850,000 households or 2.3 million people and would cost the government about 3 billion euros a year.

Spain has had one of the world's worst coronavirus outbreaks, with more than 27,000 COVID-19 fatalities. Following the epidemic and the strict lockdown imposed in mid-March, unemployment has skyrocketed and a steep recession is now looming. ($1 = 0.8981 euros)