Payment for Care, Impact on the Economic Situation of the Pensioner in Denmark, Sweden, Norway, Finland, Great Britain and Germany

Micro simulation is used to graph the economic situation of single pensioners receiving public old-age pensions in six European countries when the former earnings vary from a low to a relatively high level. The economic situation is measured by the income concept called ‘Family Purse’, i.e. disposable income after net housing costs. Two alternative ways of calculating gross housing costs are included, one is 20 percent of former earnings, another is 20 percent of gross pension income.
In two of the countries, Denmark and Germany, there is no direct payment for care provided by professionals in the home of the pensioner, but the four other countries have pay schemes for care. The impact from payment on the economic situation of the pensioner is studied in two cases, one with care for one hour a week and another with care for one hour a day. The relative impact from payment on the ‘Family Purse’ of the pensioner for each of the two housing cost alternatives is calculated at selected income levels and the ‘impact profiles’ are compared for the four countries with pay schemes for care for the elderly.