Luxembourg
(last updated January 2001) |
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Introduction and OverviewLuxembourg is the European Union's(EU) and OECD's smallest country in population, after Iceland, and is by far physically the smallest (only 3000 sq. km.). It is also the richest, its per capita GDP is 189 (in PPPs), exceeding that of the United States (151) and nearly double the EU average of 99. In 2001 its population was 441,300. Children under 15 years were 18.9 percent of the population, a bit above the EU averageof 16.9 percent but below the OECD average of 20.6 percent. About 14.3 percent of the population was over age 65, compared to the EU average of 16.2 percent. The country has a long history of concern with the family that goes back to the nineteenth century, was written into the 1948 Constitution, and was concerned with protection, economic security, taxation-and parental rights and obligation. The conservative nature of the society as well as Catholic social doctrine and long tradition led to policy regimes and family law anchored in the traditional model of the at-home, child-rearing mother and the male-breadwinner household head. Developments since World War II have challenged such policy with demographic change and new philosophies, and policy has been catching up. Given its economic opportunities, Luxembourg has invested generously in child allowances and tax benefits-and most recently in parental leaves. It still lags in early childhood care and education and labor-market measures for meshing work and family life. It is also concerned with measures needed to better integrate the children of its foreign workers, essential to its advanced economy.
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HighlightsClick here to view or print country highlights in pdf format. |
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Government AgenciesFour ministries are involved in various ways with family policy(1): The Ministry of Health deals with some social service and therapeutic programs (see below re: Child and Adolescent Health); the Ministry of Youth covers youth policy, youth movements, service centers, residential centers; the Ministry for Family, Women's Affairs, Disabled People and Accident Victims covers family benefits, children's services, promotion of children's rights, welfare of foreigners, social services, etc.; the Ministry of Social Security covers cash social security programs, maternity, combating poverty, and the National Welfare Service. As appropriate, there are inter-ministerial committees.
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Demographic and Other Social Trends
Luxembourg has higher fertility and birth rates than the European Union on average. In 2000, its total fertility rate was 1.78 (compared to 1.53 EU average) and its birth rate reached 13.1 (compared to the average EU birth rate of 10.9). Commenting on the population growth, the Luxembourg representative to the European Union Family Observatory stated:
Luxembourg is one of the group of Nordic countries and U.K., recovering somewhat in fertility but hardly at a replacement rate, while the southern rim countries lead in the fertility fall. Its crude marriage rate (4.8 percent) is a little below the EU average, its crude divorce rate (2.4 percent) a bit below and its cohabitation rate of 7 percent close to the 8 percent average. Of more significance, 27 percent of the 16-24s are now cohabiting, compared to an EU rate of 31 percent. According to, the EU household panel, in 1994 6.7 percent of children lived in lone-parent families (mostly with divorced parents) and 3.3 percent in cohabiting couple families, while 86.4 percent were in married couple families. Only 0.8 percent were with adoptive parents and about 800 were placed away from home-all a very stable picture comparatively. By 2000, 11 percent were in lone parent families (Eurostat). In 1999, about 3.5 percent of all households were one parents living with children. Although the proportion of lone-parent households is low compared other industrialized nations, Luxembourg experienced a doubling of out-of-wedlock child birth in 10 years, from 6 percent in 1980 to 12.7 percent in 1994 (not a high rate for Europe). One child in eight was born to cohabitating parents by the mid-90s whose mothers were between 25 and 34 years old. As a prosperous competing economy, the Luxembourg unemployment rate was only 2.1 in 1999, compared to an EU rate of 9.3. It did as well, comparatively, with youth unemployment: 6.2 percent of males under age 25 were unemployed in 1999 compared to the EU 16.7 percent and an unemployment rate of 7.4 percent for feamles under age 25 compared to EU's 19.2 percent. Luxembourg's married and cohabiting mothers have comparatively low labor force participation rates, but not its lone mothers. Only 3.6 percent of children live in households where no adult works outside the home-but only 17.1 percent are in a household where all adults work full-time. A significant proportion of working women work part-time, 28.3 percent of women in 1999, compared to 1.6 percent of men, but this is below the EU average for women's part-time employment (30 percent).
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Social ProtectionLuxembourg's public sector (government revenue and general government expenditures as a percent of GDP) is comparatively large, but recent data are not presented in available comparative tables. What is immediately relevant, however, is that (1997) social protection expenditures involved 24.8 percent of GDP compared to an EU average of 28.2 percent. However, given the high Luxembourg GDP this meant (PPP) a per capita social protection expenditure by Luxembourg of 8837 ECUs, compared to a 5334 average for the EU, 30 percent higher than the second highest country. Of its total social protection expenditures, Luxembourg committed 13.2 percent to family and child benefits, compared to an EU average of 8.3 percent and exceeded only by Norway (13.8 percent). All of this is evident in comparative benefit levels and health care commitments in Luxembourg-even though it is not the European leader when one examines health or education expenditures as a percentage of total GDP. Applying the U.S. "absolute" poverty standard, Luxembourg with the highest per captia GDP (PPP), has the lowest child poverty rate (1.2 percent) among 19 OECD countries. (The U.S., with the second highest per capita GDP, has the 6th highest rate, 13.9 percent). Applying the "relative" poverty measure usually applied in international comparisons (below 50 percent of the median income), Luxembourg has the fifth lowest rate among 23 (4.5 percent) and the U.S. ranks at 22 (22.4 percent). The 1999 "relative" rate for children in lone parent families in Luxembourg was 30.4 percent, and it was 2.9 percent in other families(3).
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Child, Youth and Family Policy RegimesMaternity, Paternity, Parental, and Family LeavesThere is a 16 week maternity leave, 8 weeks before and 8 weeks after childbirth and a related cash maternity benefit. A 4 week supplement is available for nursing mothers and in instances of premature birth or multiple childbirths. There is 100 percent wage replacement if the salary is discontinued; the payment is government financed and taxable. A cash maternity allowance with a lower grant level is available to residents not employed. The related "in kind" benefits include midwife and medical assistance and a stay in a maternity hospital. A lump-sum payment pays for drugs and baby food. Luxembourg has gradually improved its leave benefits in the 1990s. Parental leave with a guarantee of re-employment was enacted in 1999. Any person raising one or more children under age five for whom they receive child benefits is eligible for parental leave provided that cease working or reduce work hours by at least half-time. Parental leave is for six months per child or one-year if part-time parental leave is taken. Each employed parent has a right to parental leave but one of the parents must take leave fillowing maternity leave. Parents may share part-time leave during the same period in order to guarantee care of a child. The claiming parent must be gainfully employed or self-employed at the time of the birth or adoption af a child. The parent must have worked for at least one year prior to the start of parental leave for a Luxembourg based company. A monthly fixed benefit is paid by the national Family Benefits Fund (CNPF) and is financed through the employment fund (petrol products tax) and state revenues. The benefit is exempt from taxes and social contributions, except for health care and the dependent's contribution. The state pays for the pension contribution (4).
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Early Childhood Education and Care (ECEC)There is a severe shortage of child care facilities. According to the most recent accessible report, in 1996 there were only 1123 children between the ages of 2 months to 6 years in "some type of child care facility and 862 children could not be accommodated". The Luxembourg reporter for the EU Family Observatory commented, "Child care facilities do not meet women's requirements. One in every two women would like to have more crèches and nurseries available with hours more suited to her needs"(5). Many of the available child care centers are open only for 2-4 hours per day. In the mid-90s the government attempted to increase capacity by pointing to the average daily absentee rate. Children do go to nursery school at age 4, however. Compulsory education begins at 6.
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Family and Child AllowancesThere is a universal, government-financed, generous family allowance enacted after World War II but with nineteenth century roots. It covers children to age 18, students to 27, with no age limit for those disabled before 18. The payments increase with ordinal position. There is a payment supplement for children aged 6-11 and a much higher supplement for those over 12 or seriously disabled. After a 1992 reform, the then-representative from Luxembourg to the European Union Family Observatory commented, "With this reform, Luxembourg probably pays out the highest family allowances in Europe"(6). Child allowance policy and tax policy have been frequently coordinated over the past decade. Most recently, in 1996, to target more support on low-income families, there was a general increase in child benefits (beyond the routine indexing to the cost of living), while tax allowances were reduced by an equivalent amount. The family allowance system also includes: (a) Birth allowances in three installments (prenatal, birth grant, postnatal; (b) Beginning-of-school-year allowances, keyed to age group and number of children and (c) The child rearing ("education") allowance. A recent comparative study estimated that Luxembourg child allowances cut child poverty by 3.8 percent compared to an EU average of 6.7 percent(7).
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Child and Family Tax BenefitsThe tax unit is the family and there are allowances for dependent children. While there are no special cash benefits for lone parents, they are eligible for a significant tax allowance. As noted above, recent attention has been directed at coordination of tax allowances with child allowances to help low-income families.
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Other Child Conditioned Income TransfersUnder the old age and disability pension schemes, there are child survivor benefits which are doubled for full orphans. Under the permanent disability benefit scheme, there are child supplements and survivor benefits. Unemployment benefits are adjusted slightly (5 percent of base salary) if there is a dependent child. One category of eligibility for the assistance program, guaranteed minimum income (RMG), requiring a concentration on training and obtaining employment, includes lone mothers and children (about a fifth of the caseload). Eligibility qualifies the family for housing aid.
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Child and Adolescent HealthMedical coverage is based on a health insurance system, organized through occupation-based sickness funds. However, children and youth are served in maternity centers at least until age 2, then in the doctor's office and, subsequently, by the "school medicine system," covering all levels including higher education, special education, and vocational training. Legislation enacted in 1977 stipulated that children must be brought to the maternity centers where they were born for two medical examinations immediately after birth and four subsequent examinations before the age of two. When a child is born the parents are given a medical card on which the results of the compulsory examinations are recorded. Subsequently the card must be available when visiting a doctor's office. There is a free vaccination program, periodically updated following scientific developments. Luxembourg has good child health results, exceeded only by several Nordic countries and Japan in low infant mortality statistics. There is an active health, mental health, and prevention program addressed by the Ministry to all age groups. The school medicine program publishes annually the statistical results of secondary school medical examinations.
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Housing BenefitsAvailable to recipients of the assistance (RMG) program.
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School-Aged Children: Policies and ProgramsPrimary school begins at age 6 and is compulsory to age 15. The schedule covers 8 AM to noon and 2 PM to 4 PM, on Monday, Wednesday, and Friday, but only 8 AM to noon on Tuesday, Thursday, and Saturday. Children must go home for lunch. There is no after-school publicly provided care. In only 12 of 118 communes there were all-day schools, operating from 7:30 AM to 6:00 PM (1996)(8). At age 8, children begin to learn three languages. Achievements are high for the indigenous population, but Luxembourg has a high percentage of foreign nationals and there is a recognized problem with regard to their successful integration in the schools. (The problem, in some views, is class-based, not nationality.) They tend to be channeled to technical secondary education and have high drop-out rates. But as a whole, Luxembourg has a well-educated population.
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YouthLuxembourg allows children to carry out some actions before they reach the age of civil and penal majority, which is 18:
There are a variety of youth information and counseling services. In 1992 the Ministry for Youth set up a well-staffed "Legal and Social Information" service and published a handbook on youth rights. The service reports high rates of use(9). Click here to view in pdf format a table on the Ages at which children are legally entitled to carry out a series of acts in the European Union. See Youth Policies section for definitions of terms used.
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Reconciliation of Work and Family LifeThere is no comprehensive policy. Expert analyses and parental opinion studies call for specific action with regard to labor legislation (especially part-time work and flexible schedules) and child care, including school hours and after-school care. In 1999 parental leave reform was responsive (with an obvious assist from an EU directive) to the urgent need for parental leaves.
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ReferencesMonique Borsenberger and Monique Pels, "Family Policy Issues in Luxembourg," in John Ditch, Helen Barnes and Jonathan Bradshaw, eds., Development in National Family Policies in 1996 (Brussels: Commission of the European Communities, D.G. V, 1998), pp. 149-172. Monique Borsenberger and Monique Pels, "Luxembourg: Issues Concerning the Family in 1995," in John Ditch, Helen Barnes and Jonathan Bradshaw, eds., Developments in National Family Policies in 1995 (Brussels: Commission of the European Communities, D.G.V, 1996), pp.91-103. European Commission, Report on Social Protection in Europe 1999 (Brussels: Commission of the European Communities, 2000). Pierre Hausman, "Luxembourg," Family Observer 1999 (Brussels: Commission of the European Communities, D.G.V, 2000), p.35. Herwig Immervoll, Holly Sutherland, Klaas De Vos, "Reducing Child Poverty in the European Union: The Role of Child Benefits," in Koen Vleminckx and Timothy Sneeding, eds., Child Well-Being, Child Poverty and Child Policy in Modern Nations (Bristol, Eng.: The Policy Press, 2000, forthcoming). Innocenti Report Card, Issue no.1, June 2000 (Florence: Unicef International Child Development Centre), figures 1,2,3. Michael Nuyens, "A Leading Sector in Luxembourg Social Policy: Family Policy from its Genesis to its Diversity," in Wilfried Dumon, ed., Changing Family Policies in the Member States of the European Union (Brussels: Commission of the European Communities, D.G.V, 1994), pp. 198-224.
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Notes1 Borsenberger and Pels, 1995, p.103. |
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ContactsWashington Embassy Embassy of Luxembourg Ministry M. Michel Neyens European Union Family Observatory National Representative Pierre Hausman |
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