Factsheet for case
AT-2020-13/212
–
Updated
– measures in Austria
Hardship case fund: Safety net for self-employed
Härtefall-Fonds: Sicherheitnetz für Selbstständige
Background information
As part of the €4 billion fund to mitigate the effects of the Corona crisis, which the Austrian national government and the social partners presented on 14 March 2020, they also presented two hardship funds: one for self-employed in one person companies; and the other for family-run businesses. This was complementary to other measures,
see case AT-2020-12-/229
, as those two target groups would not be able to profit from the short-time working schemes.
Content of measure
The support is a one-off payment and does not have to be paid back. In addition, affected owners of one person companies may also obtain funds from the 'emergency fund' (Notfallfonds). The payments cannot be accumulated though. The hardship fund for self-employed is divided in two phases:
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Phase 1
: Applications are possible until 17 April 2020. Eligible are those who can prove that they are no longer able to cover the running costs or are affected by an officially ordered ban on entry due to COVID-19 or have a drop in sales of at least 50% compared to the same month of the previous year. The amount of the funding is €500 if the net income p.a. was below €6,000 and €1,000 if it was above €6,000. The upper income threshold (above which no grant is paid) is €33,812 net in the last year for which a tax assessment is available. It essentially applies to one person enterprises (including agricultural and forestry and private accommodation rents) and freelance workers.
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Phase 2
: Applications start on 20 April 2020. The grant depends on the income loss and lies at maximum at €2,000 per month for up to three months. No upper income threshold applies, and small companies with less than ten employees and liberal professions are eligible in addition to the group eligible in phase 1. Negotiations with NGOs are currently ongoing.
All applicants (regardless of whether an application has already been submitted in phase 1) will have the same maximum total amount of funding of up to €6,000.
In general, applications for the Hardship Fund can be submitted until 31 January 2021.
Updates
The following updates to this measure have been made after it came into effect.
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15 June 2021
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The hardship case fund is to be extended until the 30 September 2021, as announced by the federal government. Companies with a decline in sales of at least 50 percent are eligible. The funding lies between €600 and €2,000 for a company. Applications may be brought in until 31 October 2021.
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16 April 2021
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The prolongation of the Corona hardship fund (which was announced in January) has come into effect as of 16 April 2021 and applications can be submitted as of this day. The twelve-month consideration period has been extended by three months until 15 June 2021. An additional bonus of €100 euros per month is granted and transfers are now also possible to non-Austrian bank accounts. Also small and micro enterprises which have been founded as of 31 October 2020 are eligible.
Between 300,000 and 450,000 additional applications due to the extension are expected by the government. In total, €2,600 per month can be collected per applicant, i.e. a total of up to €39,000. The extension of the measure and the additional bonus will generate around €500 million in payments in total (around €140 million through the additional bonus), according to a joint government paper.
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31 March 2021
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Already in January 2021, a political decision on the prolongation of the fund until the end of June 2021 has been made. However, the legal regulation is still being awaited, so that no information on the nature of the extension is available. The WKO expects a prolongation of the pre-existing model.
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07 October 2020
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The Council of Ministers agreed on the extension of the measure as requested by the WKO on 7 October 2020. The duration is extended to twelve months, i.e. from 16 March 2020 to 15 March 2021. The maximum amount received is €2,500 per month, i.e. €30,000 in total. The hardship fund is intended to help micro-enterprises, freelancers and farmers who have financial difficulties due to the corona crisis.
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16 September 2020
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The Federal Economic Chamber (WKO) has called for an extension of the measure - an application should be possible for twelve instead of six months.
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27 May 2020
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An expansion of the safety net self-employed was announced on 27 May. Next to the prolongation of the period over which grants can be obtained from three to six months, a so called 'come back bonus' of €500 was introduced. This will be added automatically to already existing grants. Including this bonus the minimum amount of the grant will be raised to €1,000. Another novelty is that also pensioners in marginal employment are going to be eligible for the grant.
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Use of measure
Information from 1 April 2020: Around 100,000 applications for phase 1 were counted so far. The total funds for the hardship fund were increased from €1 to 2 billion.
Information from 20 April 2020: The first phase has been completed with 144,000 applications made. A total of €121 million. was paid out in the first phase.
As of mid-September 2020, a total of almost 195,000 people have been supported in phases one and two and around €528.7 million have been paid out. In the most recent period under review (mid-July to mid-August), an average of around €1,200 was paid out in each case.
As of mid-October 2020, around 203,000 people have applied for assistance from the Corona hardship fund since the beginning and €700 million have been spent. On average, €1,200 were paid per individual in the period between 16 September and 15 October 2020.
According to a survey conducted in July and August 2020 by KMU Research Austria, 57 percent of one-person enterprises have taken advantage of government support measures in connection with the COVID-19 crisis. Of these, almost all entrepreneurs have applied for the hardship fund. Significantly fewer have also applied for tax and duty deferrals (36%), installment payments or deferrals of social security contributions (35%) and fixed cost subsidies (29%).
Data from March 2021 show that so far, €1.22 billion (of the total budget of €2 billion) have been paid or committed. On average, just below €1,200 were paid per person and month.
Target groups
Actors and funding
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Actors
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Funding
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National government
Employers' organisations
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National funds
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Social partners
Social partners' role in
designing the measure
and form of involvement:
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Trade unions
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Employers' organisations
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Role
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Agreed (outcome) incl. social partner initiative
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Agreed (outcome) incl. social partner initiative
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Form
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Direct consultation outside a formal body
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Direct consultation outside a formal body
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Social partners' role in the
implementation, monitoring and assessment phase:
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Only employers' organisations
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Main level of involvement: Peak or cross-sectoral level
Involvement
The Federal Economic Chamber was involved.
Views and reactions
Social partners were consulted and agreed on the package. The employers organisation WKO is closely involved in the implemention, by informing and supporting their members.
Sources
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26 March 2020: Härtefallfonds soll bis zu 6.000 Euro auszahlen
(orf.at)
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31 March 2020: Hardship fund: safety net for the self-employed (Härtefall-Fonds: Sicherheitsnetz für Selbständige)
(www.wko.at)
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31 March 2020: Haertefallfonds - Regulation
(www.wko.at)
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20 April 2020: Uptake of hardship fund - first phase
(www.ots.at)
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27 May 2020: Improvements in the hardship fund: comeback bonus and higher minimum support for the self-employed
(news.wko.at)
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16 September 2020: WKO calls for extension of hardship case fund
(kurier.at)
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07 October 2020: NPO and hoardship fund are extended
(www.ots.at)
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13 October 2020: Bundesministerium für Finanzen - Information
(www.bmf.gv.at)
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13 November 2020: On average €1,200 paid
(orf.at)
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31 March 2021: Prolongation of hardship case fund awaited
(kurier.at)
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16 April 2021: Hardship fund extended
(www.diepresse.com)
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15 June 2021: Government extends and adapts Corona aid
(www.wienerzeitung.at)
