In an official statement, the European Commission said that “the revised rules are an important step towards fair labour mobility in the EU.”

The new reform will allow countries to have stricter limits on social assistance benefits for EU citizens who are “economically inactive” and do not have a sufficient connection to the local social security system, as reported by Euro Weekly News.

New limits on benefits

Millions of people live outside their country of origin, such as retirees, remote workers, job seekers and long-term residents who rely on cross-border rights related to healthcare, unemployment or family benefits.

Social benefits for foreign residents will not be revoked completely, but the reform seeks to clarify when countries are allowed to restrict payments for foreign residents who do not work or contribute sufficiently to the local security system.

Reducing legal uncertainty

Countries interpret the rules differently, leading to disputes over who should pay what when citizens move between member states, so the purpose of the reform is also to reduce years of legal uncertainty.

The reform updates rules on unemployment payments and family-related support, however under the proposal, people who are looking for work in another member state could continue receiving unemployment payments from their previous country for up to half a year while searching abroad.

Changes for cross-border workers

In the case of cross-border workers, they may be eligible to claim unemployment benefits from the country where they last worked instead of their country of residence. This rule only applies if they have worked continuously for at least 22 weeks in a country different from the one where they officially live. This could specifically impact the large number of workers who commute between countries for work.

The EU clarifies that families will still be eligible to receive certain payments from the country responsible for their social security coverage, even if family members live in a different country within the EU.

Debate over freedom of movement

Issues regarding welfare systems, migration and public spending are delicate topics, with some governments arguing that national systems need stronger protection against citizens obtaining social benefits without contributing sufficiently to the country. Others argue that this weakens the very fundamentals of the European Union, which is freedom of movement.

The proposal still requires formal approval before officially being implemented, but the reform signals that citizens’ access to social benefits will depend on whether someone is actively working and contributing to the country where they reside or not.