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MONEY

Danish agency criticised for failure to collect child support debts from abroad

Denmark’s parliamentary ombudsman has criticised the Danish Debt Collection Agency (Gældsstyrelsen) for failing to prioritise debts related to child support payments from persons who reside abroad.

Published: 21 March 2023 17:35 CET
Danish agency criticised for failure to collect child support debts from abroad
The Danish Debt Collection Agency insufficiently prioritised collection of child support debts from abroad, a parliamentary watchdog has said. Illustration photo: Ólafur Steinar Gestsson/Ritzau Scanpix

The child support payment, børne- og underholdsbidrag or more commonly børnebidrag in Danish, must generally be paid by one parent of a child to the other of the other if they do not live together.

But the Debt Collection Agency has done too little to collect payments of the contribution from abroad, the Ombudsman said in a press statement on Tuesday.

“Collection of child support contributions are of major importance for the financial circumstances in many homes,” ombudsman Niels Fenger said in the statement.

“It is therefore criticisable that the agency has, for almost five years, generally not promoted the collection of these contributions,” the watchdog added.

According to the Danish Debt Collection Agency, some 12,500 persons outside of Denmark have outstanding debts related to the child payments, totalling 2.3 billion kroner.

Collection of the money has been complicated by a lack of procedures in the area, the agency said.

Instead of sending requests to authorities in the relevant countries for collection of the debt, the Danish Debt Collection Agency has prioritised assisting foreign authorities in collecting debts outstanding in Denmark, it told the Ombudsman.

It also said that it would now prioritise collecting the Danish debts, and would produce a plan for the work.

This plan will be shared with the Ombudsman when it is completed later this year.

A large amount of debt is tied up in an old system, DMI, which does not allow wage deductions as a method of collection. A new system, PRSM, does enable this.

The agency is therefore working to transfer many of the debts from the old system to the new one, it reported to the Ombudsman.

READ ALSO: Denmark uses new method to collect debt from public

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MONEY

How do the Swiss manage to save more money than other Europeans?

Despite higher, inflation-driven prices for many consumer goods, households in Switzerland are putting aside more money at the end of each month than their European counterparts, a new study shows.

Published: 31 July 2023 11:50 CEST
How do the Swiss manage to save more money than other Europeans?

Even though a recent survey found that about a fifth of Switzerland’s population can’t make ends meet and need more than one job to pay their bills, another one indicates that on average, the Swiss still manage to save more money than other Europeans. 

This is what emerges from the new study from HelloSafe consumer platform. It is based its findings on 2021 -2022 figures (the latest available to date), culled from the database of Organisation for Economic Cooperation and Development (OECD).

Savings rates in the study are expressed as a percentage of GDP (gross domestic product), comprising all the savings held by households in relation to the GDP of each country.

The findings are clear: Swiss households are saving nearly 22 percent of their income, while the European Union recorded an average savings rate of 10.3 percent — that is, 11.6 points below the average Swiss rate.

For instance, looking at just Switzerland’s four immediate neighbours, the rate is 12.8 percent in France, 12 percent in Austria, 11.4 percent in Germany, and 2.1 percent in Italy.

Long-term pattern

The fact that the Swiss are European savings champions is not a new phenomenon. 

OECD figures for the past decade show that Switzerland’s population has far outperformed the EU in this area.


 
Interestingly, as the chart indicates, most savings, both in Switzerland and elsewhere in Europe, were accumulated in 2020, for an obvious reason that at least during some parts of the Covid pandemic, money spending opportunities were largely limited.

Why do the Swiss manage to put away more money than other Europeans?

You might think it is because the wages here are higher than elsewhere, and you are right — income does play a role, even though the cost of living is also correspondingly higher in Switzerland.

However some studies have shown that, taking into account the country’s inflation rate (which is lower than many other European countries), high employment, and strong economy, the purchasing power parity (PPP) — the financial ability of a person or a household to buy products and services with their wages — is higher in Switzerland than in the EU.

READ ALSO: Do wages in Switzerland make up for the high cost of living?

Another OECD study has demonstrated that Switzerland’s average household disposable income per capita is higher than the OECD average. This means that while the Swiss have more money to spend, they also have more to save, if they so choose.

This brings us to yet another reason which explains the savings phenomenon as well.

It has more to do with Swiss mentality and attitude to financial stability, which Alexandre Desoutter, HelloSafe’s editor-in-chief, calls “a prudent and responsible behaviour” towards money.

“Switzerland stands out with a high household savings rate, reflecting its solid financial culture and its commitment to economic stability,” he said.

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