23rd Mar 2018

EU bailouts: misery for old people, children, single mothers

  • Spanish protesters hold placards against house evictions (Photo: Antonio Marín Segovia)

Austerity policies imposed in bailed-out countries like Greece and Portugal are taking a high toll on the poorest and most vulnerable in society, a study published on Thursday (14 February) by the Catholic charity Caritas says.

Based on its field work in shelters and social programmes in Greece, Portugal, Spain, Italy and Ireland, Caritas noted that by cutting funding for the most deprived and by raising taxes for people on low income, the "cohesion of Europe and the very political legitimacy of the European Union are being put at risk."

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The report contradicts recent statements by EU and national leaders claiming that the worst of the euro-crisis is over and that economic recovery is on its way.

Turning large private debts of banks into public ones, as happened in Ireland and Spain "must be recognised as unfair and unsustainable," Caritas said, because the price is mostly paid by single unemployed mothers, retired people, some of whom can no longer afford medicine, and young people facing years of unemployment.

Case studies from Greece, where the charity recently expanded its aid from refugees to native Greeks, show that the drastic, EU-mandated cuts in public spending have undermined the idea of a social Europe.

The charity documents retired people seeking food and shelter, single unemployed mothers relying on the pensions of their parents and left with no income at all when their parents pass away and autistic children rejected from public day care centres.

In Portugal, where official statistics show rising rates of poverty, particularly among old people and children, Caritas also found public spending cuts affect the most vulnerable.

Cases discussed in the survey include children - evicted from houses when their parents are unable to pay the mortgage - who drop out of school and try to pick up a job on the black market or in agriculture.

They also include older people who see their pensions frozen, while costs for healthcare, electricity, gas and food go up, making it particularly hard for those living in remote areas.

A new wave of discrimination against Roma is also a problem in Portugal, especially when it comes to housing, education or getting a job.

"The crisis is not well understood by many people, leaving those affected without hope. For many of the families that Caritas Portugal is supporting, it is their first time having to seek help outside their family," Caritas says.

In Spain, the country with the highest unemployment rate in the EU, calls for help from the charity have increased by 170 percent since the start of the crisis.

People seeking help lack money to pay for food and utility bills. Cutbacks in funding for school meals raise concerns about malnutrition and general cuts in education increase the rate of school drop-outs - already double the EU average (26.5% compared to 13.5%).

Tensions within families are also increasing, as people "have to rely on family members for essential needs like never before."

The report was drafted based on available data last year.

But further austerity measures have since been adopted in Spain, including more reductions to welfare and VAT hikes.

"The impact of these measures on vulnerable groups is likely to be serious, given the high levels of unemployment and poverty already being experienced in Spain, and the finding that increases in VAT have already disproportionately affected poorer people," Caritas warns.

Meanwhile, new types of poverty are emerging in Italy.

Adults in their 40s and 50s are suddenly finding themselves out of a job after a lifetime of regular work, young people on temporary contracts are constantly on the hunt for new work, entrepreneurs are going bust, migrants are being suddenly cut off from social aid, while older people are having to help their jobless children and grandchildren.

As for Ireland, Caritas notes that "successive cuts to most welfare rates once the crisis began mean that most social welfare payments in Ireland are below the poverty line."

The problem is being aggravated by the fact Ireland is highly dependent on welfare payments to keep people out of poverty.

At 51 percent, Ireland, jointly with Hungary, has the highest poverty rate in the EU before social transfers and pensions are counted.

Caritas urged EU institutions and the International Monetary Fund, another bailout body, to take its findings into account before demanding further expenditure cuts.

The charity also called for "social monitoring" of bailed-out countries, with social impact assessments added to regular EU reports on compliance with EU fiscal targets.

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