Greece weighs 30% boost to child benefit amid budget impact

The Greek government’s economic team is reviewing a scenario to raise the child benefit (A21) by 30% without altering existing income‑eligibility rules. The proposal would increase annual spending on the benefit from roughly €700 million to €900 million, adding about €200 million to the state budget.

Targeted mainly at low‑income households, the measure is projected to raise disposable income for families in the lowest decile by 1.4%, cut overall poverty by 0.45 percentage points and child poverty by 1.42 points. Higher‑income families would see only limited gains. The interaction with the Minimum Guaranteed Income could reduce some families’ eligibility for that scheme, lowering the net fiscal cost by about 5% relative to the gross outlay. An alternative scenario involving broader coverage through a revised equivalence scale was deemed too costly and less focused on the most vulnerable.

The study, commissioned by the OECD, concludes the 30% increase is the most targeted option for alleviating child poverty while keeping the fiscal impact manageable.