Presentation on theme: "Strenghts and weaknesses of the Nordic and Continental Welfare State Models: What can We Learn from Each Other? Olli Kangas Danish National Institute."— Presentation transcript:
1 Strenghts and weaknesses of the Nordic and Continental Welfare State Models: What can We Learn from Each Other?Olli KangasDanish National Institute of Social Research & Department of Social Policy, University of Turku
2 Content of the presentation important values and importance of valuessocial insurancelabour marketssocial servicespoverty, social exclusion
3 ein einzig Volk von Brüdern? ”Now let us take the oath of this new federation. We will become a single land of brothers, nor shall we part in danger or distress.”Friedrich Schiller ( ): Wilhelm TellEU: a federation of brothers / sisters?members may have common interests butwhat about common values / solidarity?
4 The Nordics trust on their national institutions (parties, parliament, government, police and justice system) but distrust on the EUItalians trust on EU but not on their national institutionsEstonians trust neither on national nor EU institutions
6 there are big differences in general trust Nordics high-trust societiesBelgians trust in their welfare state systemhow to increase trust in EU in the Nordics?how to increase trust in national institutions in the other countries?how to increase trust in other nations within the EU?
7 Workers’ insurance versus national insurance a long term convergence between modelsin the Nordics income-relatedness has taken over and unconditional benefits have lost relativelyin the Continental model (notably so in Belgium) basic security has been improvedconsequently, differences in financing has been diminishedemployees’contributions have been introduced in the NordicsFin/Swe vs. Denis it the level of social security contributions or the structure of financing or the structure of labour market & welfare state that is important for employment?the latter
8 Central European corporatism: a hindrance for reforms? participation of social partners makes the system robustnot directly open for political manipulationhigh degree of legitimacy ”our system”harder to change, if needed, than politically administred systemsIn Sweden and Finland a number of important reforms were carried through; in Denmark welfare comission is preparing its proposals
10 the Nordic have been able to cut public debts (that are among the lowest in OECD hemisphere) budgets are in surplusEconomic growth has been pretty good since the mid 1990s (in Fin & Nor extremely good)Unemployment rates are low (Den, Nor, Swe)Employment rates are highest in the worldfemale lf-participation due to the public sector
11 Maternal employment rates by the age of youngest child 2002 (OECD)
12 Probability not to be employed after care-taking period (ECHP / Koistinen 2005)
15 Some Danish lessons high wages financed via taxes and SOCIAL security contributionseasy to dismiss, easy to get social securityhigh employment mobility30% of employees change their jobs annually!effects of globalization may be more severe e.g. in Fin & Swe than in Den
16 How to finance social services? social insurance vs. tax financinguser fees vs. tax financingproblems in tax financingtax levels are highEU sets limits for the Nordics to use previously proven devicesdiscrepancy between risk pool and financial poolUser feeshow to guarantee access to the poorest sectionsincome-tested user feespros & cons
17 Rowntree's poverty cycle in York 1899 and 2000's cycle in Continental Europe / Scandinavia and the United States and the United Kingdom.
18 third sector as a provider of social services traditionally in C-E the 3rd sector has been importantit has played a role in the Nordics, toostate-subsidizedEU directives on competition hollow up the possiblities of the 3rd sector that bifurgates into the private for-profit systems or into the public sectorprivate legislation penetrates into the social legislationEUmunicipal tenders (subject to law suits)common-law takes over the codified law?
19 the old are not poor and the poor are not old; problem of social exclusion: youth and immigrants
20 The Belgian tax experiment the dilemma between decent income from work and too high wage levels for unqualified laborin the US also analfabetics get jobhow to avoid the working but poor situationthe experiences from the Belgian experiments?
23 Challenges for educational systems those countries with good performance display low social inheritanceproblems of education / segregation in Den & SweIn Europe education more evenly distributed than e.g. in the U.S.but top-education more succesfull in the US
24 What can we learn from each other? to be small and clevernational strategiesthe common European welfare project?what are the smallest denominators for the European project?