The EU needs a social investment pact
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1 Social Developments in the European Union 2010 European Economic and Social Committee, Brussels, 30 May 2011 The EU needs a social investment pact Frank Vandenbroucke Brussels, 30 May 2011
2 The social investment imperative The fundamental societal trends that necessitated a social investment strategy are as relevant and important today as they were ten years ago, perhaps even more so because of adverse demography Investment agenda Child centred social investment strategy Human capital investment push Reconciling work and family life Later and flexible retirement Migration and integration through education and participation Minimum income support and capacitating service provision
3 The social investment imperative The fundamental societal trends that necessitated a social investment strategy are as relevant and important today as they were ten years ago, perhaps even more so because of adverse demography Investment agenda Child centred social investment strategy Human capital investment push Reconciling work and family life Later and flexible retirement Migration and integration through education and participation Minimum income support and capacitating service provision
4 What can be learned from past social investment experience? Substantive policy issues Governance issues
5 Increase in employment rate since 2004 (ppt)
6 Recent trends in poverty rates and material deprivation (%)
7 A crucial failure: jobless households in EU 15 (%)
8 Jobless households in NMS 10 (%)
9 Lessons from past experience: substantive issues Can we create virtuous circles of social protection and (egalitarian) social investment? Yes, without denying difficulties and tensions. Consistent social investment needed: social investment is a packaged long term strategy Policies must be sufficiently ambitious and mutually consistent Social investment strategies will require additional resources Quality of services & equality of background conditions Investment strategy and protection strategy as complementary pillars Vandenbroucke and Vleminckx, Disappointing poverty trends: is the social investment state to blame? An exercise in soul searching for policy makers, CSB Working Paper, January 2011, forthcoming in Journal of European Social Policy. Morel, Palme and Palier, Towards a Social Investment Welfare State?, Policy Press, 2011
10 Lessons from past experience: substantive issues Can we create virtuous circles of social protection and (egalitarian) social investment? Yes, without denying difficulties and tensions. Consistent social investment needed: social investment is a packaged long term strategy Embedded social investment needed Social investment must be embedded in macroeconomic and budgetary governance and financial regulation that support durable and balanced growth in the real economy. Social investment must be embedded in an attractive conception of social progress.
11 Lessons from past experience: substantive issues Can we create virtuous circles of social protection and (egalitarian) social investment? Yes, without denying difficulties and tensions. Consistent social investment needed: social investment is a packaged long term strategy Embedded social investment needed Social investment must be embedded in macroeconomic and budgetary governance and financial regulation that support durable and balanced growth in the real economy. Social investment must be embedded in an attractive conception of social progress and a narrative of caring Europe.
12 Lessons from past experience: governance issues Soft = weak Yet, for steering the overall orientation of social policy at EU level, there is no alternative to governance by objectives How can governance by objectives be made to deliver?
13 Taking Europe 2020 seriously While certainly not perfect, the Europe 2020 objectives translate a social investment ambition which merits full support Example: poverty, severe material deprivation, very low work intensity
14 The EU needs a Social Investment Pact The long term social investment imperative must not fall victim to short term policy orientations, i.e. ill guided austerity (short term long term) Fiscal discipline must be allowed to deliver, i.e. collective action & support needed, e.g. Eurobonds (supranational solutions welfare chauvinism) The objectives formulated under the EU2020 strategy can provide a framework for reconciling those short term and long term considerations, if the social investment strategy is embedded in budgetary & macroeconomic policy, i.e. if short term budgetary & macroeconomic governance serves long term social investment. The political deal the EU needs is one wherein all governments pursue budgetary discipline and social investment, and are supported therein in a tangible way by the EU. Such a reform oriented, forward looking deal may contribute to creating a real sense of reciprocity in the EU. Coming weeks will be crucial
15 The EU needs a Social Investment Pact The long term social investment imperative must not fall victim to short term policy orientations, i.e. ill guided austerity (short term long term) Fiscal discipline must be allowed to deliver, i.e. collective action & support needed, e.g. Eurobonds (supranational solutions welfare chauvinism) The objectives of Europe 2020 can provide a framework for reconciling those short term and long term considerations, if the social investment strategy is embedded in budgetary & macroeconomic policy, i.e. if short term budgetary & macroeconomic governance serves long term social investment. The political deal the EU needs is one wherein all governments pursue budgetary discipline and social investment, and are supported therein in a tangible way by the EU. Such a reform oriented, forward looking deal may contribute to creating a real sense of reciprocity in the EU.
16 Thank you Vandenbroucke, Hemerijck, Palier, The EU needs a social investment pact, OR (OSE Paper Series)
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