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The EU and social policy The case for a European Social Union Frank Vandenbroucke Summer School ‘The EU Inside Out’ 22 May 2015
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Main argument A basic consensus on the European Social Model and the role the European Union has to play (and not to play) in the domain of social policy… … is not a luxury. It is an existential necessity.
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Structure of the presentation The diversity of European welfare states Why is a basic consensus on social policy a necessity? – Eurozone – EU28 Which solidarity? The idea of a ‘European Social Union’ Example: social investment as a common ambition Policy recommendations & tough nuts to crack
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The diversity of EU welfare states Input: expenditure on social protection, gross, in % of GDP (2010)
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The diversity of EU welfare states Outcome: a two-dimensional map of outcomes
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The diversity of EU welfare states: poverty Poverty risk and poverty threshold: “national” conception (SILC 2010)
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The performance of European welfare states
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The welfare state is not ‘the problem’
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Structure of the presentation The diversity of European welfare states Why is a basic consensus on social policy a necessity? – Eurozone – EU28 Which solidarity? The idea of a ‘European Social Union’ Example: social investment as a common ambition Policy recommendations & tough nuts to crack
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The consequences of monetary unification
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Transfers might mitigate the symmetry/flexibility trade-off
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The EU’s way: more symmetry, more flexibility Flexibility determines social order Institutional advantage of coordinated bargaining Competitiveness: symmetrical approach necessary => convergence
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Defining the EMU’s social objective is a necessity rather than a luxury EMU forces upon the member states a shared conception of flexibility A basic consensus on the functioning of the social model is necessary for the long-term sustainability of EMU – short term: stabilisation – mid term: a symmetric guideline on wage cost competitiveness & institutions that can deliver – long term: sustainability of pensions Symmetry => convergence w.r.t. fundamental parameters => shared objectives Legitimacy => convergence in prosperity ‘excessive social imbalances’ associated with inadequate and disparate investment in human capital
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The human capital asymmetry: employment and formal educational attainment
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Why a ‘European Social Union’? an inevitability of European Monetary Union integration and social regulation in EU28 – Social dumping? – Social sovereignty? the very core of the European project.
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Why a ‘European Social Union’? an inevitability of European Monetary Union; Freedom of movement and national social cohesion in EU28: – Social dumping? – Economic freedoms right to strike (Viking, Laval) the very core of the European project.
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Social dumping…
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… or “convergence machine”? Source: Lefebvre and Pestieau, Peut-on mesurer la performance de l’Etat Providence?
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Why a ‘European Social Union’? an inevitability of European Monetary Union; Freedom of movement and national social cohesion in EU28: – Social dumping? – Economic freedoms right to strike (Viking, Laval) the very core of the European project.
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Why a ‘European Social Union’? an inevitability of European Monetary Union; Freedom of movement and national social cohesion in EU28: ‘a balancing act’ – Social dumping? – Economic freedoms right to strike (Viking, Laval) Two dimensions of solidarity: domestic (national) and pan- European
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Why a ‘European Social Union’? an inevitability of European Monetary Union; Freedom of movement and national social cohesion in EU28: ‘a balancing act’ – Social dumping? – Economic freedoms right to strike (Viking, Laval) Two dimensions of solidarity: domestic (national) and pan- European
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Structure of the presentation The diversity of European welfare states Why is a basic consensus on social policy a necessity? – Eurozone – EU28 Which solidarity? The idea of a ‘European Social Union’ Example: social investment as a common ambition Policy recommendations & tough nuts to crack
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A European Social Union A Social Union would support national welfare states on a systemic level in some of their key functions guide the substantive development of national welfare states – via general social standards and objectives, leaving ways and means of social policy to Member States – on the basis of an operational definition of ‘the European social model’. European countries would cooperate in a union with an explicit social purpose, pursuing both national and pan-European social cohesion
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Convergence in prosperity: the social investment imperative A social investment agenda (cf. Europe 2020, SIP) – 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 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.
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Spending on education 2004-2008-2012
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Spending on education 2004-2008-2012 and PISA results
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Convergence in prosperity: the social investment imperative A social investment agenda (cf. Europe 2020, SIP) – 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 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.
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Structure of the presentation The diversity of European welfare states Why is a basic consensus on social policy a necessity? – Eurozone – EU28 Which solidarity? The idea of a ‘European Social Union’ Example: social investment as a common ambition Policy recommendations & tough nuts to crack
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The case for a European Social Union support national welfare states on a systemic level in key functions (e.g. stabilization) guide the substantive development of national welfare states – via general social standards and objectives symmetric w.r.t. to competiveness (wage policy & capacity to deliver) social investment minimum wages and minimum income protection solidarity in reform – leaving ways and means of social policy to Member States
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The case for a European Social Union support national welfare states on a systemic level in key functions (e.g. stabilization) guide the substantive development of national welfare states – via general social standards and objectives symmetric w.r.t. to competiveness (wage policy & capacity to deliver) social investment (investment in and protection of human capital) minimum wages and minimum income protection solidarity in reform – leaving ways and means of social policy to Member States
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The case for a European Social Union support national welfare states on a systemic level in key functions (e.g. stabilization) guide the substantive development of national welfare states – via general social standards and objectives symmetric w.r.t. to competiveness (wage policy & capacity to deliver) social investment (investment in and protection of human capital) minimum wages and minimum income protection solidarity in reform – leaving ways and means of social policy to Member States
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The case for a European Social Union support national welfare states on a systemic level in key functions (e.g. stabilization) guide the substantive development of national welfare states – via general social standards and objectives symmetric w.r.t. to competiveness (wage policy & capacity to deliver) social investment minimum wages and minimum income protection solidarity in reform – leaving ways and means of social policy to Member States Tough nuts to crack
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Thank you! 1.F. Vandenbroucke, The Case for a European Social Union. From muddling through to a sense of common purpose, Euroforum Policy Paper, Sept. 2014 www.kuleuven.be/euroforum/papers www.kuleuven.be/euroforum/papers 2.F. Vandenbroucke, with B. Vanhercke, A European Social Union. 10 Tough nuts to crack, Friends of Europe, Spring 2014 http://www.friendsofeurope.org http://www.friendsofeurope.org 3.Unequal Europe. Recommendations for a more caring EU. Final Report of the High-Level Group on Social Union, Friends of Europe, Spring 2015 http://www.friendsofeurope.orghttp://www.friendsofeurope.org
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