The Ministry of Family wanted to take into account a European Court of Justice judgement when drafting the reform bill. In 2017, European judges had found a breach of European law in the 2016 reform, after a cross-border worker had been refused child benefit for his partner’s child, on the grounds that he was not the child’s parent.
The new bill would switch the right to claim child benefit from the child to the parent, to ensure equality between residents and cross-border workers. However, the Council of State said this change would potentially create new inequalities, because two conditions would have to be met in order to obtain the family allowance.
On the one hand, according to the reform proposal, it would be necessary to be affiliated to social security in Luxembourg and on the other hand, to be the father or the mother of the child. This would exclude a certain number of children from child benefit, such as:
In addition, parents who no longer have guardianship of their child at all could still be eligible to receive family benefits.
The Council of State also rejected the Ministry’s arguments used to justify its reform of family benefits. The Ministry explained that offering child benefit to the spouses of cross-border workers would negatively impact the “Zukunftskeess”, or the National Fund for Family Allowances, causing potentially unmanageable situations. However, the Council of State refuted this concern, saying it was not a reason to justify causing inequality.
The Council of State has therefore issued a formal opposition to the reform bill.
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