The government reached an internal agreement on Tuesday to move ahead with the reform, including subsidies and unemployment programs. Ministry of Labor sources confirm that subsidies are non-contributory benefits available to certain unemployed individuals who have exhausted their entitlements. In recent weeks, there has been visible tension among senior leaders, with Nadia Calviño and Yolanda Díaz publicly and privately expressing concerns. After a lengthy round of negotiations, the plan was finally resolved on Tuesday.
Reforming various subsidies to streamline access and simplify the system has been an overdue priority for more than a decade. The coalition government has recently faced setbacks, while the European Union is seeking approval to authorize the fourth payment of European funds, totaling 10 billion euros.
These frequent disagreements among vice presidents are expected to be settled in the coming days by the cabinet. The reform will adjust three core elements: its scope, the amount, and the duration, as well as how it aligns with employment objectives.
How will unemployment benefits change?: Keys to the conflict between Díaz and Calviño
Who can access?
The Labor Ministry proposes making the subsidy available to specific segments of the population, totaling about 400,000 people. Up to 250,000 current agricultural workers would gain access to the agricultural subsidy in communities outside Andalusia and Extremadura, where access had previously been limited. The remaining 150,000 beneficiaries are under 45; they have not been eligible due to age, but the proposal would extend eligibility for those without dependents.
On the other hand, Labor’s plan would channel roughly 120,000 people toward the Ingreso Mínimo Vital (IMV), the state’s minimum income program, with proposed changes to the qualification rules to integrate this group.
Economy officials have recommended restricting access for those over 52. However, sources close to the talks indicate that this approach did not progress.
How much and when is it paid?
Two main areas of disagreement between Calviño and Díaz concern the amount and the duration of the subsidy. The final reform is expected to resemble a more modest version of the latter plan, but with reductions relative to the original intentions.
Economy recommends an initial higher payment that gradually tapers, with a plan to shorten the total period while maintaining a meaningful annual average. The proposal outlines a schedule that begins with a higher first-quarter payment and then declines, yielding an average around 442.5 euros per month over the year.
Labor advocates propose a more generous structure: 660 euros for the first six months, 540 euros in the next six months, and 480 euros for the remainder of the unemployment period, extending benefits to 30 months in total.
Is it compatible with employment?
Where the differences are widest is in the integration with work. The Labor Department emphasizes facilitating the return to employment, proposing that 100 percent of the subsidy be combinable with the first salary during the initial 45 days of formal employment. At this time, Calviño’s position was still not disclosed.
Breastfeeding consent and the European directive
The unemployment benefit reform is just one of several measures expected to be approved by the Council of Ministers on Tuesday. The government also plans to update breastfeeding leave to allow more flexible scheduling. Currently, breastfeeding leave lets workers take half an hour daily without pay; the proposal would allow this half-hour period to be accumulated to 28 consecutive days in a year. Many sectors are already negotiating similar arrangements via collective bargaining, and Labor aims to extend this right universally. Breastfeeding leave would be available to all employees with a newborn, covering the first nine months of the child, with potential extension to one year if both parents choose.
Additionally, the Council of Ministers will implement the transposition of a European directive on price transparency. The directive strengthens the enforcement of equal pay for equal work between men and women, requiring employers to clearly specify salaries and scheduling in job ads as part of broader steps toward greater wage transparency.