This EPC issue paper is an urgent call to put social investment at the centre of the EU’s policy agenda. Its authors see the concept of social investment as well as its full and comprehensive integration into policymaking and budget allocations as a prerequisite for a strong, modern and sustainable Social Europe.
Social investment does not simply mean more social policies write laire Dhéret and Lieve Fransen. It goes beyond the question of social expenditure and rather requires a radical change of mindset on the role of social policies and how they are delivered. The concept ‘social investment’ means investing in people from the earliest stage in life, promoting the participation of each individual in the economy, adopting a life-course approach, adapting policies to individualised circumstances and providing services in an integrated manner. In the social investment logic, good social outcomes are the result of a complex and balanced mix of policies that complement and reinforce each other. In the same vein, protective and active measures are two sides of the same coin and social protection is an integral part of a successful investing strategy. It bears a significant potential, namely to address two growing challenges that the EU is currently facing: the inadequacy of many welfare state regimes to cope with new social and economic developments, in particular those transforming and polarising the labour market, and the growing socio-economic divergences that affect both member states and the EU as a whole. Often, these divergences originate from significant disparities in human capital investment, which has become increasingly important in the knowledge economy.
The authors of this paper argue that the role of the EU in fostering and promoting social investment is key and a necessary step towards a stronger and more modern Social Europe. While many believe that there is no appetite for such a move and that the push for a more social Europe would only strengthen the voices of populist and Eurosceptic forces, this paper supports the opposite view. Its authors believe that too much time has already been wasted, and that the absence of a comprehensive social investment strategy across member states partly explains the economic, social and political crisis the EU is facing. Pursuing this path further would, in the medium to long run, entail a number of risks with fatal consequences for the EU, the eurozone and its member states. First, a further increase in economic and social divergences would make the eurozone particularly fragile and accentuate imbalances between the best and worst performing countries, prolonging therefore the need to support the ‘weakest’ given the strong interdependency of national economies. In the worst-case scenario, member states’ interests and expectations as regards monetary policy would diverge too much, with both the eurozone and the EU at risk of eventually falling apart. Second, the absence of a strong Social Europe would further nurture citizens’ anger towards the EU and a sentiment that EU policies are threatening their well-being and quality of life. This would, in the end, further embolden Eurosceptic movements. But if, on the contrary, the EU is able to reinforce its social dimension with a robust strategy on social investment, enabling greater competitiveness in the weakest countries and social convergence within the EU and the eurozone, citizens’ attitudes towards the EU are likely to change. In fact, the Union can then become a driver of positive changes and social progress for all.
Some countries in the EU have embarked on this journey since some time and have, as a result, survived the financial crisis relatively unscathed. There is, however, still some work to do, both at the national and EU level. In fact, the reality is that, despite a few recent and welcome steps at the EU level (including the adoption of the Social Investment Package in 2013), social investment has only been developed superficially. In addition, there is a misalignment between EU policy objectives and their implementation in practice.
To reverse this trend and turn the EU into an agent of positive change and social progress for all, setting up a concrete EU action plan for a full and comprehensive implementation of social investment is essential. As recommended by the authors, this plan will have to rely on three main pillars: a European roadmap to ensure a minimum level of social protection for all (i), a stronger focus on investing in human capital in the EU budget (ii) and, a set of reforms to align EU governance with the social investment imperative (iii). A number of important steps will have to be taken in each of these pillars as summarised in the table below.
laire Dhéret (Senior Policy Analyst and FutureLab Europe Programme Leader) and Lieve Fransen (Senior Adviser to EPC on health, social and migration policies)The full paper which has ben published by the European Policy Centre (EPC) can be downloaded from http://www.epc.eu/documents/uploads/pub_7468_socialinvestmentfirst.pdf
