Financial social assistance or cash benefits

In all the Nordic countries, financial social assistance may be granted when all other support options in connection with loss of income or other circumstances have been excluded. This form of means-tested assistance is the last resort available to the social security systems.

Social assistance in general

Financial social assistance serves either as a substitute for other sources of income, or as a supplement to very low personal incomes. It may also be granted in connection with e.g., dental or medical treatment, spectacles, assistive devices in the home and relocation costs. Assistance for other purposes is awarded and granted according to need, in order to meet living costs


The level of financial social assistance is determined by household income and is subject to tax. The amount of the financial social assistance (cash assistance) depends, among other things, on the recipient’s age and any obligation to provide for children.

For recipients under the age of 30, the amount of the cash assistance also depends on their level of education.  Wealth and income also affect cash assistance.

The individual concerned cannot be awarded cash assistance if they or their spouse have any assets. However, the local authorities disregard amounts of up to DKK 10 000 per person. It is possible to be awarded cash assistance in the event of e.g., absence due to sickness, unemployment or dissolution of cohabitation. However, if an individual applies for cash assistance solely on the grounds of unemployment, they must also be available for work.

This means that they are obliged to turn up for interviews arranged by the local authorities; that they accept a reasonable offer of activation or work provided by the local authorities; and that they actively seek employment. If an individual is not available to work, the local authorities apply various sanctions that reduce cash assistance.

Faroe Islands

Financial social assistance is subject to tax. Assistance provided under the Welfare Act is either temporary or permanent. Temporary assistance is provided in the event of absence due to sickness, divorce or lack of job opportunities.

Permanent assistance is granted to people who are not entitled to benefits under the Pension Act but have a permanent need for support to maintain themselves and their families. Temporary assistance is granted depending on age, form of cohabitation and maintenance obligation, as a percentage of the sickness benefit.

Single persons with a maintenance obligation are granted the highest benefit (90 per cent of sickness benefit), while those under 25 living with their parent(s) are granted the lowest benefit (13 per cent of sickness benefit). Permanent assistance is granted at an amount corresponding to 60 per cent of sickness benefit.


The level of financial social assistance is determined by household income and is a tax-exempt net benefit. Social assistance is intended to be a source of short-term financial aid that helps recipients overcome or avoid temporary difficulties and promotes their autonomy and independence.

Social assistance consists of the following three components: basic social assistance, supplementary social assistance and preventive social assistance. The Social Insurance Institution (Kela) has paid out basic social assistance since 2017. Previously all forms of social assistance were paid out by municipalities.

Applications for basic social assistance is submitted to the Social Insurance Institution. The national government fixes the basic amount of financial social assistance annually. The right to basic social assistance is then determined by means of a calculation of income, assets and expenses.

If a recipient repeatedly refuses to accept a job offer or training, the financial social assistance may be reduced by 20–40 per cent.  If there are specific expenses which the basic social assistance does not cover, the municipal social services office may at its discretion provide supplementary or preventive social assistance.


The level of financial social assistance is determined by household income. The assistance is taxable. The local authorities are obliged to pay financial social assistance to people unable to provide for themselves i.e., those whose income falls below a certain level.

The Ministry of Welfare has drawn up guidelines for what should be taken into consideration in connection with this award, but the basic amount is not fixed by the national government.


The level of financial social assistance is determined by household income and is a tax-exempt net benefit. The government has drawn up recommended guidelines for awarding support, including current expenditure on daily maintenance costs.

These guidelines are a recommended starting point for local authorities’ calculations, which consider the applicants’ incomes and financial rights, as well as their essential day-to-day expenses. No upper limit is placed on the amount of the assistance, which may also take the form of a loan. In special cases, the social authorities may grant financial assistance to those who need help with overcoming or adapting to difficult circumstances, but who would otherwise not qualify for financial social assistance. 

People drawing financial social assistance may be required to meet some conditions. The primary purpose of these conditions is to help the recipients improve their situation, and thereby provide for themselves, by applying for relevant jobs and participating in guidance meetings, vocational courses and/or training and retraining measures, etc. Under the Act on Social Services in the Labour and Welfare Administration, people of working age with a considerably reduced capacity to work are entitled to participate in a qualification programme and receive a qualification benefit.

Entitlement to the qualification programme presupposes that the individual concerned is not entitled to benefits under the Social Security Act or the Labour Market Act. In other words, the primary target group consists of people for whom financial social assistance is their main source of income. The benefit is not income-adjusted.

The qualification benefit is taxable and amounts to twice the basic amount of the Folketrygden annually for people over 25 years. The basic amount is fixed by Parliament and adjusted annually from 1 May to reflect the wages of those in active employment. People under 25 receive two-thirds of the full amount. The benefit is adjusted annually. A child allowance may be awarded as a supplement per working day.

Participation in a qualification programme may be planned for up to one year, with an option to extend for one year. In special cases, a further extension of six months may be granted. The programme must be full time and individually tailored. It may include motivation, training, treatment and other measures aimed at qualifying participants for working life.


The level of financial social assistance is determined by household income and is a tax-exempt net benefit. Financial social assistance, known as “financial assistance”, serves two purposes – it must guarantee a family a reasonable financial standard of living; and it must be preventive and rehabilitative.

Local authorities usually offer unemployed recipients measures intended to prepare them for work. Those who are fit for employment but who do not apply for or accept offers of work, etc., will often lose their entitlement to assistance.

Every year, central government sets national standards for subsistence expenses e.g., food, clothing and consumer goods, and often rent and transport. In calculating the amount of the financial assistance, a recipient’s total income is taken into consideration, including any maintenance allowance, child allowance, housing benefit, etc. If, for instance, the housing benefit increases by SEK 200 per month, the amount of financial assistance will be reduced accordingly.

For those having received financial assistance for at least 6 months and start working 75 per cent of the net earnings is exempted in the calculation of financial assistance. As in Norway, there is no upper limit, and financial assistance may also be granted on a loan basis e.g., if a recipient expects to be in receipt of income that makes it possible to repay the assistance provided.