PHS policies - Implementation and monitoring guide

Cost reductions for providers


In the interests of developing supply in the sector, one type of intervention that can be made is a reduction in cost for PHS providers. This type of intervention focuses on the supply side and can be made through several types of measures, including:

  • Subsidies to providers, in the form of direct financial intervention from the public authorities. This is the case in Belgium, for example, where registered companies receive a government subsidy of € 13.54 or € 54 per hour on top of the € 8.50 or € 9.50 paid by users.
  • Employers’ contribution exemptions, which are also a direct financial support to companies. This measure reduces the social contributions employers have to pay for their workers. This is the case in France were approved associations providing care services receive implicit State support through the partial or full exemption of social contributions, making their labour much cheaper.
  • Reduced VAT rates, which are a form of indirect financial support to companies, as they reduce the price for users. Such is the case in France, where household services benefit from a reduced VAT rate of 10 % as of 2013 (up from 5.5 %).