OECD (2001) OECD Employment Outlook, OECD Report. Official journal (1997) Regulation 1466/97,Lsop/r, EU, Brussels. Polanyi, K. (1944) The Great Transformation, Rhinehart, London. Politiken (23/11-2003) Tyskland ogFrankrig färsazrbehandllng l EU'. Pollack, M. A. and Hafner-Button, E. (2000) Mainstreaming Gender in the European Union, Jean Monnet Working Paper no. 2, Harvard. Presidency Conclusions (2000«) Lisbon European Council, 23/24 March 2000, SE roo/oo, EN. European Communities, Brussels. -----(2000i) Nice European Council, 7-10 December European Communities, Brussels. -----(2001a) Stockholm European Council, 23 and 24 March European Communities, Brussels. -----(2001/7) Laeken European Council, 14-15 December European Communities, Brussels. Presidency Conclusions, Brussels (2003) Brussels European Council 20 and 21 March European Communities, Brussels. Rees, T. (1998a) Mainstreaming Equality in the European Union—Education, Training and Labour Market Policies, Routledge, London. Rees,T. (1998&) Women and the Labour Market: Maimtreaming Equality in Leonardo da Vinci, University of Bristol, European Training Village. Roberts, I. and Springer, B. (2001) Social Policy in the European Union—Between Harmonization and National Autonomy, Lynne Rientr Publishers, inc. Ross, G. U995) 'Assessing the Delors Era and Social Policy', S. Licbfried and P. Pierson (eds.), European Social Policy—Between Fragmentation and Integration, The Brookings Institution, Washington, DC, Sabatier, P. (1998) 'The Advocacy Coalition Framework', Journal of European Public Policy, 5(0:98-130. Scharpf, F. (1988) 'The Joint Decision Trap: Lessons from German Federalism and European Integration', Public Administration, 66(3): 239-78. -----(1999) Governing in Europe-Effective and Democratic?, Oxford University Press, Oxford. -----(2002) 'The European Social Model: Coping with the Challenges of Diversity', Journal of Common Market Studies, 40 (4): 645-70. — and Schmidt, V. (eds. 2000) Welfare and Work in the Open Economy, Vol. I. Oxford University Press, Oxford. Schoukens, P. and Carmichael, L. (200t) 'Social Exclusion and Poverty' in D. Mayes, J. Berghman, and R. Salais (eds,), Social Exclusion and European Policy, Edward Elgar, Cheltenham. Wallace, H. and Wallace, W. (eds.) (2000) Policy Making in the European Union, Oxford University Press, Oxford. Young, R. and Wallace, H. (2000) 'The Single Market', in H. Wallace and W. (eds.), Policy Making in the European Union, Oxford University Press, Oxford. New Social Risks and Welfare States: New Paradigm and New Politics? A^^c^e^-w Peter Tayior-Gooby The social changes associated with the post-industrial transition increase Cj)^kuj the exposure of some groups to new needs. These give rise to the new social risks that we identified in Chapter 1, associated primarily with family and labour market charge: and ^eliare stare reform. This chapter reviews the development of such risks in European countries and analyses policy responses. We will consider how new social risk issues are best understood in terms of the evolution of European welfare states and in terms of the political processes that will shape future patterns of welfare state development. In the former area we will discuss issues of conver-gence and path dependency of whether the instruments used to meet new social risks are qualitatively a1irHělTrfrOm~those^jšed"To tackle old social risks and of the goals and processes of welfare state policy-making; the key question is whether new social risks contribute to a new paradigm of policy-making, or whether new socialjrisk policies are best understood as following the existing pattern of-differentiation by welfare sj^tej^^me. In Chapter r we suggested that the impact of newv social risks tends to be reinforced or mitigated by the existing welfare settlement, and that regime framework also exerts a strong, but not determining, influence on policy response. In the latter area of political process, the focus will be on the eJctentjüjArh^ forces and toa/new politics' of welfare. Our Chapter r hypothesis was that i changes will be most marked in areas where the interests of more powerful j social actors coincide with those of new social risk bearers, and will be ] shaped by those interests. As in the case o( the introductory chapter, J am grateful to the WRAMSOC groups for ideas and suggestions generated in debates during the course of t he research project. The Emergence of New Social Risks and Responses to Them The accounts of experience and of policy-making at the national and EU level in Chapters 2-8 shows how institutional structures influence both the emergence of and the response to new social risks. Contemporary analysis of European welfare states typically categorises them in a framework derived from Esping-Andersen's influential work on regimes (1990,1999), as was discussed in Chapter r. Re^me^categories offer a convenient framework for summarising old social risk policies. We show that regimes shape the emergence_of_new social risks, but in many cases policy responses involve new departures. These indicate possibilities for a 'new politics' of welfare. New social risk policies do not restructure the pattern of regime differences. They are insufficiently substantial in public spending terms, accounting for less than three per cent of GDP across the European Union {Table 1.1). Even in France, the evolution of the targeted 'second world of welfare' described in Chapter 5 has resulted in an increase in the proportion of social benefits administered through means-test from 10.9 to only 11.5 per cent between 1991 and 2000 (Eurostat, 2003a). The impact of reforms on citizens' lives is limited, being focused primarflv_onJrarishi£nsirrto paid work pr_.sp_ecific_ phases in the family iife cycle. However new risk policy-making does reveal opportunities for welfare state dynamisrrTänd ihriovätiön~~eveTnn those areas wlielre~Imrriöbin^^ pre"s3uTé"š~seem strongest. Following recent discussion of regimes (summarised in Jaeger and Kvist, 2003: 555-7) we also distinguish Mediterranean welfare states. These have developed rapidly, with universal health care systems and social insurance pensions, but are much weaker in family benefits and provision for those on low incomes (EU, 2002a; chart 15). They also tend to rely on family-based informal care, and are hampered in some areas by the slow development of administrative capacity (Matsanganis et al., 2003: 643-4). The European Union is also included in the analysis of this book because it has taken a strong interest in the area of new social risks_ and is likely to become more influential in the future. Its approach to welfare does not fit neatly into the traditional regime framework and its authority is limited. As Chapter 8 shows, 'open market' policies, reinforced through legal and financial sanctions, dominate EU policy at the economic level and exert a real indirect influence on national welfare systems (Leibfried and Pierson, 2000: 269). The EU's attempts to construct a 'social dimension' on a similar scale to its economic policies through the rapprochement of national NEW PARADIGM AND NEW POLITICS? 2II systems were unsuccessful. Overt engagement with social provision is now chiefly through the more circumspect 'open method of co-ordination'. The strongest element in OMC has been the employment strategy, with its commitment both to broadly market-centred goals of greater flexibility, and to a more progressive vision of expanding opportunity through investment in human capital. This is paralleled in the social inclusion and education strategies and the mainstreaming of equal opportunity policies for women which bear in practice on work, education, and training (Leibfried and Pierson, 2000:271; Geyer, 2001: chs- 5 and 7). As an embryonic welfare system, the EU's approach appears to reflect some feature of the market-^ ongn_tedJ[beral regime, but also tojndua^ommitments to intervention intended to promote more universal access to the benefits of market-ledr growth^ The regime approach groups welfare states on the basis of the policy frameworks developed to meet old social risks. How well do the emergence of new social risks and the policy responses fit within these categories? The experience of the representative countries included in this book indicates that both processes correspond loosely to regime categories (in other words, old social risk regimes condition the emergence of new social risk regimes), but that there are also substantia! areas where the traditional regime categorisation is less helpful. Contmmn^conflicts over new social risk issues indicate possible future directions for reform in labour market activation and in child and elder care policies. These conflicts arFmost marked in corporatist and Mediterranean countries, where new risk innovations imply the strongest challenges to the old social risks regime and whj^e_j^]^cv^maiang typically requíresliíěleTíglh}^^ compromise. Nordic Countries Nordic countries have estabiished traditions of social _service_siipport jo enable women to function as cjtigen-workers, and the two case-studies included—Finland and Sweden—provide good examples. Both spend more than twice the EU average on services for women with children and about three times the average on services for older and disabled people (Table 1.1), The commitment to support for all 'citizen-workers^ is reflected in the narrowness of the gap between men's and women's participation in paid work (along with Denmark, the narrowest in the European Union) and the fact that, along with other Nordic countries, they comfortably exceed the EU's Stockholm targets (Table 9.r). Both countries also have weli-developed F'F_1 t Fi lAťLOK i .UOU Table 9.1 Employment 2001 Overall Men's Women's Women's Long-term employment employment employment full-time unemployment rate rate rate employment rate Denmark 70 So 71 56 2.3 Finland 68 70 65 56 2.4 Sweden 75 77 74 53 I.i Austria 68 76 ÓO 44 0.8 Belgium 60 69 Si 34 3-4 France 62 69 55 42 3-2 Germany 66 73 59 39 4.1 Netherlands 74 33 65 27 1.0 Switzerland 79 88 70 39 0.8 Greece 56 71 41 37 4.0 Italy 55 69 41 32 0.0 Portugal 69 77 61 52 1.6 Spain 59 74 44 37 5-S Ireland 65 76 54 36 2.0 UK 71 78 65 32 1-4 EU-15 64 73 55 41 3.3 2010 Target 70 60 Note: Full-time means at least 30 hours a week; long-term means more than twelve months Sources: Calculated from OECD (2003a: tables B, D, E, G) schemes for ensuring ttiatjhose without jobs have access to programmes to enable them to develop new skills and lead the EuropeanUnion inActi ve Labour Market Programmes throughout the 1990s. However, recent cutbacks on spending in these areas (particularly on job subsidies in Sweden) as employment improves, coupled with a greater emphasis on activation policies in corporatist countries, lead to a situation in which activation spending in the latter group parallels or exceeds that in the former (Table 9.2). The long-standing tradition of provision to address the issues which have emerged more recently as new risks in other countries generates a rather different structure of new social risks in Nordic countries from that elsewhere in Europe, as Chapter 4 shows. Groups such as immigrants, lone NEW PARADIGM AND NEW POLITICS? US ■ 9.2 Spending on active and passive labour market measures (% GDP, 1997-2001) 1997-93 2000-01 Active measures Denmark Finland Sweden Austria Belgium France Germany Netherlands Switzerland Greece Italy Portugal Spain Ireland UK 1.Ö6 1.40 1.96 0.44 T.22 r-35 r.27 1.58 o.77a 0.44 n.a. 0.77 0.70 n.a. 0.38 Passive measures 3.S3 2.56 1-93 r.27 2.64 I.84 2.28 2.52 i.ro 0.44 0.86 0.83 1.40 n.a. 0.78 Active measures 1.56 0-95 1.09 0-53 r.30 1.31 1.20 1.5S n.a. 0,46 n.a. o.6r 0.73 n.a. 0.36 Passive measures 3.00 2.02 1.19 1.07 2.r8 1.65 1.92 r.86 0.48 0.47 0.63 0.90 1-33 n.a. 0.5 6 Notes: * *999 figure Source: Calculated from OECD (20030: table H) parents^andjarge^fa^ increasjnjqpressures. dunngjhe last decade and are less well served In addition, recent welfarestate reforms thatcurtailed the main pay-as-you-go financed state pen^pjlicherneand esta_büsJ2ed_cornpulso.ry_private funded, pension s alongside it, give rise to futyre-E!25H!2ÍÍM social risks among those whose private pension component performs badly. ~~ Nordic social welfare systems have been broadly successful in maintaining incomes among those most affected by the recessions of the r 080s and early 1990s, and the consequent rise in unemployment and spending constraint, so that poverty levels remain the lowest in the European Union and inequalities the least marked (Table 9.3). New risks in these countries are thus potential rather than actual. As a number of commentators have pointed out (Kuhnle, 2000; Esping-Andersen, 2002: 17) the main issue '■ti [ií Table 9-3 Poverty and inequality (ECHP, 1999) % Population at Inequality ratio risk of poverty, 1999 Denmark n 4.2 Finland n 3-4 Sweden 0 3-2 Austria 12 3-7 Belgium :3 4.2 France 15 4-4 Germany TT 3-6 Netherlands II 3-7 Switzerland — _ Greece 21 6.2 Italy l8 4-9 Portugal 21 6-4 Spain 19 5-7 Ireland I8 4-9 UK 19 5-2 EU-15 15 4.6 Notts: The poverty line is 60% of median equivalised disposable income for the country; the inequality ratio is measured as the ratio of the total equivalised income or the top quintlle to that of the bottom quintile Source: ECHP: EU (2003fr) confronting the Nordic welfare system is whether itjvili be possible to maintain the tax and employment rates necessary to sustain it in the face of growing international competition from countries with greater degrees of social inequality and lower spending. This issue also emerges powerfully in internal debates, with some influential private sector figures leading the case for greater flexibility in employment, see pp. 98,109. Thus the emergence of new social risks irrthis context is shaped by the existing high level ofjmiyersal and widg^£g_ng_ing provision which caters effectively for the needs__ex^erienced elsewhere in Europe as new risks. Existing policies impose particular pressures on welfare provision and these seem likely to influence the extent to which reforms in the future may lead to the emergence of further areas of new social risks. NEW PARADIGM AND NEW POLITICS? Corporatisl Countries The study includes the two most important European examples of corporatist welfare states—France and Germany—and also Switzerland, where welfare reflects key features of corporatism, but in some areas achieves provision closely related to employment status through compulsory occupationally related private insurance, rather than social insurance (Adema, 3000). In these countries old social risks policies have developed around the_needs of aJ^^ breadwinner industrial working_c]ass, and new social risks present substantia] challenges. There is one key difference; in relation to the risks surrounding women's access to paid work, France stands out among corporatist countries in terms of the extent to which it has developed extensive pre-schooling and child-care support policies which enable women to maintain a higher degree of commitment to paid work when responsible for young children (Table 1.2). Women's overall participation in the labour market is in fact close to the EU average and lower than that in most cor-poratist coufl tries, but women who do work are more likely to be able to do so full time (Table 9.1). One development in the 1980s has been the APE benefit, which pays cash benefits to support women who stay at home to care for their children, leading to what is effectively a dual system. This may be responsible for a decline in recent labour market participation by mothers (pp. 130-1). The further extension of child-care provision is a major topic of debate. A national scheme of support for elder care has emerged only in the late 1990s. In general, new_social risks m these countries have emerged in ways tlia^areshaped by the existing structure of old risks welfare: the Bismarckian model resulted in relatively weak provision for child careln Germany and Switzerland, and provision has expanded only recently. Christian Democrats in Germany have tended to stress the equal worth of paid work in the formal labour market and care work in the home. In 1986 the Kohl government implemented a major reform of parental leave and of other policies which had the effect of promoting part-time working for women (p. 39). More recently. Social Democratic/Green Parry Federal governments have pursued policies which encourage state governments to extend the primary school day and increase provision of child care, through specific subsidies and more indirect support. The political conflict over mothers-at-home benefits against day care provision has some similarities to that in France in the 1990s. In Switzerland much provision is cantonal, but very recently federal subsidies have been provided to promote day care (pp. 17S-9). 3n all three countries, in line with an approach to welfare that focuses primarily on the needs of male industrial workers, care for older people tends to be provided informally and supported through local assistance schemes. Both France and Germany enacted national schemes to provide benefits to older people to enable them to pay for care (from relatives or others) in the 1990s—the German scheme was a new pillar of social insurance, the French scheme was tax-financed. Both schemes do not provide sufficient resources to cover full care costs and have been subject to continual debate and reform. Thus the existing policy model shapes the way new social risks have emerged in relation to child and elder care. Recent policy responses have involved substantial change to the system, and are a focus of political conflict. For labour market policy, the old social risks regime was designed in the context of broadly neo-Keynesian labour market management. Social insurance is shaped round the interests of established industrial workers. There is little opportunity for those who are weakly unionised, who work" part time or are on short-term contracts to present their interests. The response to the pressures on employment inGermany and France through the 1970s and 19805 was to expand early retirement schemes—'welfare without work'—which defended the interests of labour market insiders by reducing the supply of workers who might compete for their jobs and providing adequate pensions for those no longer needed. This restricted the access of other groups to stable employment and increased the numbers competing for the newly developing areas of work. Those without relevant skills were at high risk of social exclusion. By 1992 over a third of unemployed people in both countries had been without work for more than a year (OECD, 2003i?: p.20). Dwmg_the_i9_9_os there has been a tendency to cut back such schemes, to promote more limited and flexible work contracts that do not carry the expensive social insurance contribution obligations of established jobs and to develop extensive activation programmes, particularly thrqugMra^ing__ and_s_ubsidised employment (OECD, 20030: table H). Concern aboutjocial insurance contributions in France centred on the issue of how far employment costs damaged the competitiveness of national industry, French social insurance contributions raise 15.2 per cent of state revenue and are the highest in Europe (Table 9.4). They bear particularly heavily on employers, fuelling anxiety among business groups. In France, the reforms have been part of the process whereby a 'second world of welfare' has developed alongside the social insurance system to meet the needs of groups weakly attached to paid work (p. r32). This world NEW PARADIGM AND NEW POLITI CS? 217 Table 9.4 Social security contributions Employees' Employers' contributions, contributions, 2000 (% GDP) 2000 (% GDP) Denmark 1.9 Finland 2.2 Sweden 1-9 Austria ó.i Belgium 44 France 4-0 Germany 6.5 Netherlands S.i Switzerland 3-9 Greece Ó.2 Italy 2-3 Portugal 3-3 Spain 1.9 Ireland 1-3 UK 2-5 EU-15 4.0 0.3 8.9 11.9 7.2 8-5 11.2 7-3 4-7 3-9 5-2 8.3 5.1 8.6 2.7 3-5 Ó-5 Mote; J EU-14 figures Source: Calculated from OECD {2003i); OECD (1994) Social security contributions as % of total tax revenue 1992 4 22 28 32 3Ö 44 38 38 3* 3* 20 24 35 13 17 27-3'' 2000 5 24 28 30 28 34 36 31 "J 30 25 24 30 13 IÓ 25-3a consists of means-tested support, typically linked to requirements to engage in activities likely to increase employment opportunities. Thus social inclusion spending, almost all of it means-tested, has increased at just over one and a half times the growth rate of state spending as a whole between 1991 and2000 (Eurostat,2003tí). Anegativeincometax(Primepour 1'Emploi) has been introduced to. enhance work incentives. Insurance unemployment benefits have been reformed to increase pressure to pursue work. in Germany, the fact that economic growth was the slowest in Europe throughout the 1990s (at r.3 per cent, roughly two-thirds the European average—OECDľ 2003/?: r4) dominated political debate on labour market r A 'T ! OK i.i () i.) H i reform. Debates about insurance contributions were also coloured by concern about electoral punishment as the gap between gross incomes and take-home pay grew wider. Employee contributions are roughly equivalent to employer contributions and raise 6.5 per cent of total tax revenue, the second highest proportion in Europe (Table 9.4). Reforms have emphasised, job subsidies (especially in the context of the dislocations to the labour market resulting from the reunification with the East) and on the promo-tion of 'mini/_an.d 'midi' jobs to enhance labour market flexibility (PP- 35-7)- A particular concern was long-term unemployment—highest in Europe after Italy and Spain (Table 9.1), and continuing to rise to 48 per cent of all unemployed by 2002 (OECD, 2003b: 20). The 1998 Red/Green government initially reacted against the more liberal measures of the previous government, but by 2002 was implementing tougher entitlement criteria, stricter activation measures and introducing a new more directive means-tested benefit for the long-term unemployed. While unemployment in Switzerland has remained relatively low by European standards, the levels reached in the mid-1990s (5.7 per cent by 1907) were sufficiently high to generate intense poiicy debate. Social contributions are much lower than in othe^^o^p^afe^oujTtries, since so much of pensions and health care is financed through occupational insur-ance (p. 223). However, increased claims jeopardised the finances of the schemes. The legislative response in 1995 incorporated both increased contributions and time limits on entitlement (to restore financial stability) and subsidies for cantonal activation programmes. This enabled a compromise between the programmes of right and left parties and the interests of employers and unions to be achieved, in keeping with the consociational basis of Swiss policy-making. The impact of welfare reforms in creating further risks has applied mainly to pension restructuring in France and Germany and to those whose access to unemployment benefits is curtailed and who are required to enter negative activation programmes. In both France and Germany, changes to the well-established, expensive, and potentially costly pension systems have involved a number of legislative measures and protracted political conflicts in a policy area previously marked by consensus. Both countries have enacted reforms which change entitlement formulae and contribution requirements to contain future costs. In Germany, a small optional private funded pension has been established alongside the state scheme, but this has attracted relatively few savers. In France the expansion of private saving through life insurance and similar vehicles indicates a declining confidence in the capacity of state provision to maintain former NEW fARADICM AND NEW POLITICS? standards. The German scheme is highly regulated and there is considerable debate about the extent to which the restrictions limit returns deter investors. Old sqoaljisksj^oUci^^ emergence of new social risks in corporatist countries intwo ways; passively by ensuring that .resources aredirected to the particular needs of_a life-course ^rurtured^ by_the_traditional industrial labjourjnarket (so that policy-makers have been slow to recognise the new needs of mothers and carers seeking to enter paid work and those unable to access employment); and actively by reinforcing labour market structures and systemsjoffamjly life wjiichcompound the exclusion of such groups. Policy-making has been delayed by_slcu£glgs_between reformers and the entrenched interests surrounding old social risks policies, who typically have access to a range of veto-points in corporatist systems^ andjs in most places incomplete. In general, newjisjy^olic^ fromjhepatier^ although there are national differences. Most reforms have been based on tax-financed provision (the exception being the new German long-term care insurance benefit). Most have involved provision directed at particular groups, and the policy departure involved in the construction of a system of targeted support outside the social insurance regime has been particularly significant in France. There have been new departures in policy-making concerning the de-regulation of some aspects of paid work and the re-regulation of private sector care services and pensions. Theresponses to new socialrisks do not sit comfortably within the established structure of the corporatist regime. New social risk policy-making has ledlô^óTTRč^xgnjlict_oye_r welfare and has contributed to the breakdown of the inter-party consenžu^QP social policy in Germany during the 1990s- Conflictjrontirmes in both France and Germany, centred on labour market and pension reform but also involving provision for long-term care. Liberal Coimtrics The United Kingdom is the foremost example of the liberal regime in Europe. Here new social risks needs were largely neglected by the selfconsciously monetarist Conservative governments in the 1980s and 1990s on the assumption that a freer and more flexible labour market would absorb those at hj.gh_nskjofjmejr^lp^ment, and that child care could also be managed primarily through the market. However, policies to meet such needs' formed a major part of the New Labour programme from 1997 onwards (pp. 66-7). The New Labour approach followed the central theme of the liberal model: highly targeted provision, directed at the enhancement of market success. It involved new departures in the UK context (substantial extension of policy intervention in areas which had previously been treated as largely private concerns and enhanced regulation of the private sector) and was linked to a modernised social democraüc^gindaof_the promotion of citizen interest througjijsq^ provilIonT ' New social risks in the United Kingdom have emerged in ways influenced by the existing welfare system and particularly by the weaknesses in provision that result from reliance on the market. Child-care provision had been limited and largely privately provided, so that, while female employment is relatively high (Table 9.1), mothers are much less likely to engage in paid work than elsewhere, or to move from full-time to part-time employment (Table 1.3). The shift away from traditional industrial breadwinner employment was more rapid than in most other European countries. The proportion of the labour force employed in the industrial sector in the United kingdom fell from fourth highest la the European Union arter Germany, Spain, and Italy in 1991 to fifth from the bottom (exceeded by france, Sweden, the Netherlands, and Greece in 2001—OECD 2003Ď: 16). Privatisation in ateas such as pensions opened up potential new social risks among those with low or uncertain incomes. The relatively deregulated labour market_combined with weak provision for more yjJln^rabje_grca]ps had produced hij*h]eyels of poverty and inequality (Table 9.3). The policy response by New Labour was to ejstaj^h^hj^gj^^ directed atspecľhoriej^^ sJ^.ggyjH*üLfo-. 5^fc t.Q.....g-^í^dJJie^.egu^típn_pf private provision. The national chijd-care strategy relies principally on the expansion of private provision, and P^yrrients fo£jcar^re£Libsidised through targeted tax cred-its. Direct provision of extra places through Sure Start and similar schemes is focused on areas of high deprivation. Long-term care is also chiefly financed privately with some means-tested state support and provided mainly through regulated private agencies. The New Deal programme is designed to activate unskilled labour market entrants and other groups among the unemployed, and is targeted through means-testing. 'Make work pay' policies include a national minjmum_wage, set at a relatively low levels the indexation of short-term benefits to prices rather than earnings and targeted sup port for low-paid people through tax credits. The_oyera]l objective is to reduce poverty by mobilising those on low incomes into paid work. .\JljV r'AfiADlüM AND MEW POLITICS? 221 The development of risks as a result of welfare state reform is most obyj^usjnthj^ tjTe_rr^ontyj^ proyjsi£njc^^ The government has found difficulty in estab- lishing a regulatory regime which will both guarantee the security and adequacy of pensions and provide suitable incentives to the industry to supply them. One result of the recent strengthening of regulation and the increased recognition of demographic pressures is that many occupational schemes have closed or been restructured on a 'defined contribution' basis, and employers have taken the opportunity to cut their contributions. The gap between pension savings committed and those necessary to ensure adequate provision is estimated at £27 billion and continues to increase (ABI, 2002: p 2). Incentive policies have failed to encourage employers or individuals to prioritise saving, and government has strengthened targeted provision for the poorest pensioners through a substantial extension of tax credit to this group. In general, tjiejipjpjx^ach^ regime reflects the key features of the liberal model—targeting of state help and a reliance on market forces. The New Labour version seeks to use these techniques to achieve ends closer to those of social democratic states, so that its interventions are on a greater scale than is customary in the United Kingdom and extends to new areas. Commitment to welfare goals through private market means also highlights issues of control which emerge in the areas of child and elder careand pensions, where it is necessary to regulate priyatg supjjhj^ax^ established. In ail these areas conflicts between providers and government have developed, in relation to long-term care, government has been forced to abandon a proposed regulatory standard in order to ensure continuity of provision from the private sector. In pensions, government has been unable to address the problem of introducing compulsion for occupational providers or for individuals in relation to pension savings because this would conflict with the market principle of autonomy, and is thus unable to deal with a substantial and growing pension savings gap. Medih'rmnc'ifi (lountrie^ Spanish experience with new social risks typifies many of the issues facing Mediterranean countries. Newrisks have emejggd.Lmost powerfully in relation tohigh levels of unemployment, especially among young people (over 22 per cent for 15-24 year olds in Spain in 2002—OECD, 2003ŕ72oTand for IT I f K IA r I uh:-;.tOUl-. í the long-term unemployed where the rate is the highest in Europe after Italy, Greece and Germany (Table 9.1). They are also beginning to appear in the conflict over reconciling work and family life for women. As the table shows, women's overall employment rate in Mediterranean countries (with the exception of Portugal) is the lowest in Europe, although engagement in full-time work is closer to the European average and higher than in liberal and some corporatist countries. Existing old social risk welfare systems are ig^wdj-deyelonedthar^^-where in Europe, and havejiifluericedjh^em^ ment and the dominant assumption thatcareisjirovided informally by women (pp. 139-40). Family solidarity has traditionally sustained more vulnerable members, and helped to manage issues of poverty in the absence of robust state support. New social risk policies that deregulate employment have intensified the risks for some groups. Limited access to secure jobs and weak assistance benefits contribute to the highest poverty rates in Europe and highly unequal societies (Table 9.3). The chief policy direction in relation to the labour market has been the slackening of regulation, most notably through legislation passed in r994, resulting in the creation of a large number of short-term and part-time jobs. About a third of the Spanish labour force hold short-term contracts. There are targeted benefits for the long-term unemployed, and a regional system of means-tested support (Rentas Minimus) has developed through the initiatives of meso-level government. The main new risks to emerge from reforms to old ri^kpoli^iesconcern labour market deregulation. PoUaesctesjgj^^ competitiveness in the context of globalisation and membership of the Single European Market imposenewris_ks on those who become vulnerable to unemployment. The welfare settlement contained in the 1995 Toledo Pact and confirmed in 2003 appears to ensure stability for the medium-term future. However, there are real concerns about the pension prospects of workers with interrupted contribution records on the part of left-wing parties and unions. Plans to promote more equal opportunities for women have been developed. Child and elder care provision is limited, local and variable. Legislation for modest long-term care provision has been postponed repeatedly since 2000. A new system of tax relief for child-care costs has been introduced. This is of more value to higher-paid workers, and contributes mainly to support for middle-class women, who are most able to afford dav care. JLW PAKADIÜM AND HtW PCLiMO.' 223 Mediterranean welfare states have not developed extensive new social iiskjpj^licie^ Oneresuitjisajiramatic decline in fertility^ since women are unwilling to balance the roles of informal domestic carer and paid worker and opt increasingly for the latter (Castles, 2003: 209, Moreno, 2002: 6), but this issue is only now entering policy debate. The EU Level The EU commitmentto the principle ofsubsidiariry means that it is insuf- ficiently active in social policy to influence the emergence of new social risks. However, Open Market and associated Growthand Stability Pact pol- ^řtu^f /7*^ icies have had an indirect influence on social issues. In the former casef '^^f^ industrial restructuring associated with freer European competition f^g- Q impacts on the pressures forjreaterjabour market flexibility_and for reduced labour costs at the national level, and contributes to the reforms in the more regulated labour markets of corporatist and Mediterranean countries. The pact imposes additional pressures for spending constramt^dlhese have contributed to policies such as the round of pension reforms that took place across Europe in the early and mid-1990s (Lintner, 2001: 330). Many of the national policies discussed above have been pursued in the shadow of EU economic policy. Enlargement which will broaden the open market to include more diverse economies, at different stages of development, is , f likely to increase pressure for economic flexibility. with^eJcuWnsfec£^^ř social policy. Support from member states for initiatives to harmonise welfare across OH £y Europe lost support in the early 1990s. Anjmportant set of recently developed policies attempts to influence reforms at the national level through targgtsseUnjheOI^Thjsjnfluence is applied at the level of policy outcome, with thechoice of measures left to the individual state. The five-year impact evaluation of the EES (the most advanced OMC policy relevant to social issues) concluded that 'there have been significant changes in national employment policies, with a clear convergence towards the common EU objectives', and highlighted activattoja^oJUcií^ labour taxation, greater flexibility and improvements in child care (EU, 2002c: r). While policies which promote activation, reform tax to reduce labour costs, advance equal opportunities, expand child care and encourage the availability of more flexible jobs can be identified in EU member countries, it is hard to establish how far these developments_are_the outcome of EU-leyel_ activity_o_r_of more far-reaching and .simultaneous social changes. The report admits that labour market participation is still ť b I U-' ľ\i ! ■'.(■....... 'far below the Lisbon targets' (EU, 2002í?: 16) The lack of EU-level enforcement mechanisms (as exist for economic and fiscal policies in the Broad Guidelines for Economic Policy, EU, Regulation 1466/07. L 209/1) and of subsidies to promote the required changes makes major departures in reform inspired at the EU level unlikely (Chalmers and Lodge, 2003: 6). Directives in areas such as parental leave and working time have required national governments to improve the level of provision to a common standard and, perhaps more important, stimulated 'surprisingly far-reaching effects' in voluntary reforms exceeding the level required (Falkner and Treib, 2003: 20)- EU 'soft law' also provideslegiün^ na_tionajm)J£yactors and acts as a catalyst in the formation of coalitions— for example in relation to assistance in Spain and other Mediterranean countries (Matsanganis et at, 2003: 652) or for pension reform in France (Palier, 2003: 5) and stimulated policy-learning (O'Connor, 2003:12). The „EUjjgjicies thus have real but weak effects on outcomes at the national level. Whether the OMC provides a setting in which more directive policies will be possible in the future is at present unclear. It may be argued tnat tne open method is a considerable threat to existing policy advance in European integration, on the grounds that the establishing of OMC practice with no enforcement mechanism institutionalises and legitimates national differences (Chalmers and Lodge, 2003:15). Convergence, Path-Dependency, and a 'newparadigm' . {ßhChihoHS Two overall conclusions can be drawn from this review: first, exjshng^ welfare policies have shaped the emergence of new social risks in various European societies. Thus regime differericeiC'd^ responses to old social risks, are powerful factors in influencing the pattern of new risks that different European countries now recognise. The second conclusion, however, is thar^riienerwj^^ oped do not invariably reflect thechajactemti^ risk regime. In Nordic countries, to be sure, where new risk regimes were established earlier, the risks are in general catered for within the existing settlement. Further new social risks for groups such as migrants may be tackled through extension of those policies, in the corporatist countries, which make up the majority of European welfare states, new social risk responses indicate new directions in welfare, but reforms are currently incomplete, so that the scale of the changes is uncertain. In cases such as France this may be understood as the emergence of a parallel 'second world of welfare', means-tested and tax-financed, alongside ,\iĽ'A ľAlíA.JiuiV; AN ť MtVV POLIIlLi- the social insurance system; in Germany it represents a drift away from the Bismarckian basis of state welfare in the face of pressing labour market issues, in liberal countries the pattern of previous provision (targeted responses and a reliance on the market) may be identified in new social risk policies, although there is a simultaneous contrary shift to greater regulation. Development of new social risk policy appears limited in Mediterranean countries, in part because strong family systems have so far provided informal child care and cushioned the high levels of youth unemployment. There are indications that younger women may not be willing to both participate full time in paid work and act as traditional informal household carers. The moves to deregulate employment are a new direction in the context of the Mediterranean regime. New sodalrisk reforms are shaped overall by path-dependency, bm, ( , im^VveJn^^ used to/tafl|i^jw^ the needs vary. A decline in the contribution of social insurance contributions to the finance of state spending may be noted among the corporatist countries (particularly in France, which has the greatest reliance on this system of finance in Europe) leading to some convergence, and reflecting the growth of tax-financed welfare among this group (Table 9.4). Labour market controls have been loosened in corporatist countries to assist the creation of jobs with low social contributions, although in the liberal UK the implementation of a minimum wage implies somewhat stronger regulation for the most vulnerable groups. There are, thus, weak tendencies to convergence; in some policy areas evident in the data. New social risk policies jn general apply to fewer citizens for shorter periods in their lives than old social risk policies. They also absorb a much smaller proportion of welfare state spending. They do not amount to a restructur-ing of the welfare settlement. However they may indicate fresh directions within countries which were seen as immobilised in a 'frozen welfare landscape' (Esping-Andersen. r9p6: 2; Pierson, 1998). The ways in which new social risks have emerged and been recognised have been extensively shaped by the existing policy regimes. Protection of the interests of l 'insider' workers in corporatist systems has hampered labour market \ changes to provide for new and low-skilled entrants; assumptions about ( family roles limit the expansion of social care facilities; existing liberal í commitments to market solutions influence the extension of those soiu-j tions in the area of new social risks. However, the emergence and expan- Ssion of tax-financed targeted provision within the corporatist model with assumptions about entitlement that stress obligations,, to .prepare for employment rather than contribution record, and the enctoacnmentjH social care on family divisions of labour indicate the possibility of a gradual shift towards a different approach to the newly emerging welfare needs. in Chapter i we described the shjftjronTju^ par_adjgrn in economicjjplicy towards a 'pragmatic monetarist placed much greater reliance on the support of market freedoms. The 7 strong emphasis on the mobilisation of the citizen worker in a more flex-/ ible and competitive labour-market and the tendency to develop welfare / that erodes the traditional gender division of formal and informal labour ) indicate that policies for new social risks are adapting to this new \ approach. New Social Risks—New Politics? Tlii' Institutional Context Newsj3cia^^ We move on to consider thepoJUical^^ enced thedeveiopjnent_of^ . These include institutional frameworks and the interactions of key policy actors, institutions are conveniently thought of in terms of theextentto which constitutional structure (in the broadest sense, including informal frameworks of interaction with social partners and the role of religion and political culture as well as the legislature, executive, and judiciary) promotes consensus or majoritarian decision-making, and the extent tojyhichjhf-ferent groups are able toj^rjamote^^ ' (Lijphart. 1999: ctli). Relevant policy actors, in addition to political parties and local and national governments are the social partners (with their I interests in national economic competitiveness, in labour costs and business regulation and in the working conditions of union members), the groups representing those most affected by new social risks and new social risks-bearers themselves as a political force. Neitjierernplriy^^ social risks. Some industries are in greater need of skilled employees than others, and unions may represent groups in different industries or with a different balance of older employees (for whom the old social risks concerned with health, retirement, and pensions predominate) and younger employees (closer to new social risks). Some employers' groups in Germany, Spain, and the United Kingdom have campaigned formore child i care provision. 'Modernising' unions such as CFDT in France or Unison in i the United Kingdom have assented to activation reforms such as PARE, NEW PARADIGM AND NEW POLITICS? PPE, and RMA or the New Deal and the Single Gateway, while others, such as FO or the TGWU, have been more concerned to defend existing entitlements and work contracts. NeW-«njy ľí- i IrR ['Vy LÜi-.-.:Ü'''jßV and 27 per cent, so the potential for releasing paid workers is much less (Eurostat, 2002: tables A.20, 21). Political Actors: Labour Market Reform In relation to labour market policies, patterns of support have been more complex. The breakdown of the neo-Keynesian paradigm in the 1980s and its replacement by a loose 'pragmatic monetarism' as described in Chapter 1, coupled with the experience of high unemployment and persistent long-term unemployment, and concerns about the position of European countries in increasingly competitive global markets, led to widespread dissatisfaction with existing affairs. Policy debates have often taken the neecMfor ..ghgj]g£J^J^gi£^arting;Pomt ana" centred on which reforms should be pursued. Employers' groups and centre-right parties have tended to promote the extension of negative activation, with benefit entitlement closely linked to the active pursuit of work and 'make work pay' policies wjnjchjiolddown benefit levels relative tojvages^ Social democrats jiaye promoted more positive activation, which supports entry into the labour rnarket_and thgjleyelojgmj^ One policy direction has been a ten- dency to revise labour marketregulation in order to promote greater flexibility, especially in relation to the well-established" job security and wage bargaining rights of corporatist and Mediterranean countries. The Swiss activationscheme achieved a compromise between employers and unions by including time limits to unempfoymenTTnsurarice^benefit entitlement anc^deasmgjederal funds for cantonal ÄLMPmealuŕe^äTä time when the finance ofthe schemewas in jeopardy as a result of rising unemployment. In Nordic countries the strong endorsement of existing ALMP systems means that debates are about future reforms rather than current developments, but employers' associations have argued for greater labour market flexibility, accepting the likelihood that this would lead to enhanced income inequality. In France, and particularly Germany, the encouragement of jobs outside the existing pattern of regulation has been pursued. In both countries, benefit reforms following a logic of 'make work pay' rather than of replacement income have been introduced, and benefit entitlement has been linked more closely to the active pursuit of work. In the former case, the role of a modernising union (the CFDT) and the employers' association, MEDEF, has been important in enabling labour market and benefit reform to take place as a result of the campaign for a more active refondation sociale. In Germany, splits within the key actors (business, experts, and the major political parties) coupled with the strong opposition of trade l\itW PARADibM ANü NtW POLITICS' unions, diluted and delayed reform of the less regulated 'mini-job' sector and the expansion of subsidised low-wage jobs in the 1990s. A gradual shift to Fördern und Fordern (carrot and stick) policies has taken place during the last decade, but all parties agree that the reform process is incomplete. Proposals for a unified benefit scheme for all long-term unemployed, which would be more directive, means-tested and tax-financed are currently before parliament. In the United Kingdom, the New Labour government is able to impose a policy reform agenda which combines positive and negative activation, both policies highly targeted. Shifts in the position of trade unions, which initially opposed any dilution of social insurance-based unemployment benefits, but favoured the more positive activation of New Deal and the Minimum Wage, and of employers (concerned about extra spending, but reassured by government commitments on taxation, by the low level at which minimum wage was set and by upskilling policies) enabled these reforms to proceed. In Spain, the chief direction of reform since 1904 has been towards greater labour market flexibility. An agreement on the protection of part-time workers between government and unions was rejected by employers in 1998 and the right-wing Popular Party government implemented further de-regulation of part-time work in 2001, despite opposition by the left and unions. One reason why central government has tended to focus on regulation issues may be that the regional level of government has become increasingly prominent in relation to assistance benefits. It was this tier that pioneered Rentas Minimas minimum income schemes between 1988 and 1995, with support from unions and in line with other EU countries and the expectations of the Maastricht Social Chapter. An attempt by central government in 2002-to introduce strong negative activation measures (including the debarring of those who did not take any job offered from the means-tested assistance benefit) failed after a general strike and opposition from unions and the left. Employers' organisations were divided on the issue and the government accepted seven out of the eight modifications proposed by the unions. Political Actors: New Risks Resulting from Welfare State Reform Since the reform of old risk social policy is a continuing process, the implications of such changes for the generation of new social risks and for political responses are at present uncertain. The most important area appears to be pension reform, and here the changes are potential rather than actual. 1J|- 1 i h lAY i i>\< ■ ujdi; i New policies, driven by concern about the costs of demographic shifts, may impose'riew risks, particularly on fh£gewhp are most vulnerable in the labour market. Pension reform has involved government, social part-ners and the mass public, who hope one day to have access to adequate, secure pensions, and also important interests from the private pension industry. The issues cross-cut the traditional politics of old social risks, and the considerations of cost containment, personal responsibility and contribution to labour market flexibility that characterise debates jjtoout_ new social risks. In corporatist countries, reform has been slow, and is at present unresolved, due to problems in achieving a viable compromise solution between the interests of the various actors. In France, public sector unions were able to halt' a restructuring of their pensions proposed by the Juppe government in the mid-1990s, and careful negotiations have been necessary to permit the introduction of a more limited and as yet incomplete reform programme. In Germany, a series of measures designed to resolve pension issues have been implemented, in each case leading to reforms that required yet further legislation within a tew years. In both countries governments of the centre-left have been able to move further in introducing spending cuts and encouragement to the private sector than those of the right. In the Swiss case, pension reform has proceeded through compromises that trade off the established interests of policy actors, most importantly business and trade unions. The leading Scandinavian country, Sweden, achieved a settlement through lengthy negotiations between political parties, civil servants and expert advisers (see pp. 107-8). The fact that the social partners were excluded from these negotiations appears to have helped those involved to agree on a solution that balances a reform to the state scheme (which contains costs) with a modest funded private scheme, designed to provide additional retirement incomes. In Spain the pension settlement of the Toledo Pact (1995) was restated in 2003, and appears to have been achieved in a context where the pressures on pension spending were less severe than elsewhere. Nonetheless, current debates indicate that a move towards private pensions is likely, and this may lead to greater vulnerability for those without good employment records in a more flexible labour market. The liberal bias of the New Labour government in the United Kingdom has made it difficult to resolve the conflict between commitment to market freedoms for employers and citizens, with a strong ideological emphasis on personal responsibility, and the desire to produce secure well-regulated pensions, in a context where the interests of a powerful financial sector Nbw PARADIGM AND NEW POLITICS? 233 must be safeguarded. The UK constitutional framework allows government to make and implement policies rapidly, without extensive consultation. However, despite a series of consultations and independent reports, no settlement in the area of pensions appears likely in the immediate future. Thenewsocialrisks that emerge in these contexts concernJ_hasgj^hoarp less well protected, typically because their work records do not give them entitlement to good pensions. Tííe~prohÍems of labour market flexibility appear likely to be most severe in Spain, but issues surround the development of mini-jobs in Germany and the capacity of the private sector to provide good coverage for such groups in the United Kingdom. A secondary concern is the impact of pension privatisation, and the extent to which this transfers risk directly to the individual. T'^L£2]i!^ mobilised a wide range ofpoliticai actors but the minorities most likely to be^rectly affected by new entrenched interests of the more powerful actors among the social partners__have delayed reform and ensure that pension restructuring remains incomplete in all of the countries studied. The Swedish solution is again the exception, in that reforms that seem least likely to generate new risks have been developed through a process in which the social partnered id not have a strong role. The capacity of different welfare states to generate (with considerable labour) new policies to manage^the problems of old risk provision-—which is often taken to indicate resilience to the pressures discussed in Chapter 1— in fact appears likely to generajten^e^vrisks for particular groups of citizens. ■ New Social Risks—a New Departure Alongside the Traditional Paradigm New social risk reforms^aiejible.. to make headway .in European countries, despite the fact that new social riskjjjejarersjrre themselves a relatively weak political force. Reform processes depend in most cases on the programme favoured by the political actors who are able to exert an influence. The capacity to make such cornprormsesdep_ends on instih^onalstrucrure and on the mteresjsjnobjj,^ issue. The fact that the welfare state settlements based on old social risk interests are vulnerable to modification indicates that systems which have sometimes been seen as 'immovable objects' admit ^hjfts_injhej}°^^ It is these shifts, and sometimes splits, within the established groupings of actors that are of particular importance in the development of new social risk policies. .I.;-] PL '■ LK ÍAYLOK uUüÜY Realignments of Policy Actors In the UK context, the crucial shift has been the change in position of the Labour party, from commitment to a traditional welfare state (which provided national insurance benefits, modified Keynesian support for employment and allowed child care to remain a private issue) to a 'modernised' settlement, which includedboth positive and negative activation policies and highly targeted support for child and elder care costs. This enabled alliances to be formed with some groups in business, particularly over child care and activation, and precipitated a shift in the position of leading unions who were otherwise excluded from political engagement within the majoritarian centralised institutional framework. The liberal context shaped reforms within a targeted and market-centred approach, but the peculiar dominance of the party of government in the UK context plays a major role in the scale and rapidity of reform in ail areas except pensions. In the corpora tist countries reviewed, a shift towards the construction of new social risk welfare systems alongsideJh^Jl^t^^^-r'ri^ insurant structure has emerged. Institujjr^naXfrajnewo^Jia^^ The more centralised polity of France, with its particular roles for the social partners in the social insurance system and its traditions of citizenship and of commitment to support for women workers, has developed a tax-financed arm of the welfare system based on the discourse of national solidarite, but has found difficulty in carrying through a coherent package of labour-market reform. In Germany, the more consensual institutions and multiplicity of veto points have slowed reform and facilitated a greater role for social insurance institutions. In both cases, realignments of social actors have been important, in the role of modernising unions and employers' representatives in France and of the failure to rebuild consensus among the key actors on the desired direction of change in Germany. Attempts to construct agreement around the 1998 tripartite 'Alliance for Jobs' did not succeed. New policies (Agenda 2010) build on the strategy of local Job Centres, more regulatory benefit reform and modest deregulation proposed by the Hartz Commission. In Switzerland, the high degree of consensus required for successful reform has led to more limited changes. The difficulty in finding a middle ground between the actors is indicated by the fact that innovations to meet new social risks have tended to originate outside the traditional pattern of government commissions. In Spain, the relations between central and regional levels of government as well as between social partners and parties, and the opportunities for mobilisation around particular issues, have produced new opportunities NLW PARADIGM AND NEW POLITICS? 235 for reform. Regional government has been able to carry out innovative reforms with the support of the left-wing political parties and unions (as in the case of assistance), but not independently (as in the case of long-term care). In recent years, central government allied with employers' groups has promoted deregulation, but found it more difficult to implement negative activation policies in the face of vigorous opposition by the unions. In the Nordic countries, an enduring consensus that government should enable all citizens to contribute as workers has led to extensivenewsocräT risks provision, so that attempts to cut services, curtail spending or introduce more negative activation are largely unsuccessful. Power Resources and Policy Communities Accounts of welfare reform are based on two broad models—'power resources', which stresses the capacity of social interests to promote policies which they believe will best serve their interests, and jmproacheswfuch^ strj^theimpjDr^ behind change^The latter tend to focus on the role of policy communities, issue networkj^advp^c^^ and similar associ- ations, often enabled by normative entrepreneurs, in negotiating, developing and promoting common ideas (for a brief review of literature on 'groups at the centre of policy construction', see Schmidt, 2002: 211). Analyses then consider how the ability of eithennterests or acrors *s mff P: enced by political institutions, welfare state regimes, policy feedback,_g_ov-ernment action and so on (Heclo, 1974; Skocpol and Amenta, 19SÓ; Esping-Andersen, 1990; Pierson, 2001). These perspectives correspond loosely to materialist and idealist epistemo-logies and tend to develop in different contexts. The power resources model originated among analysts of Nordic welfare states (Korpi, 19S3; Huber and Stephens, 2001: p.17), where developments have been shaped by struggles to reduce class and gender inequalities in a universal welfare citizenship. Approaches which centre on the interaction of key actors reflect the way in which policy evolves in systems with a broader range of power-holders, such as the corporatist European countries, the United States and the European Union (Richardson, 2001: 7-11). From the former perspective the chief political constraint on new social risk policy-making is the lack of specific mobilised power-resources. Unskilled would-be labour market entrants and those whose lives are dominated by care responsibilities are not well organised to exert political power. The alliances between an organised working class (to some extent in collaboration with middle-class interests) that have been seen as driving change in industrial welfare states (Baldwin, 1990) are not available. From the latter, the difficulty lies more inidentifying how reforms that affect new social risks can enter the policy discourse or In tracing the process whereby šupportfrorn more powerful actors is negotiated (Wallace and Wallace, 2000: ch. 3). BodijuDprcad^^ social risk-bearers to other groups. The review above indicates that new social risk policies in relation to labour market reform, child care, andthenew pension policies that impose particular risks on some groups, have developed primarily as a result of the power resources and negotiating capacity of more influential pohticaj^ actors than the actual risk-bearers. Political conflicts over the direction of policy continue. The outcomes so far appear to be labour market reforms that combine in different degrees commitments to negative incentive-based activation and de-regulation, chiefly supported by the right and employers, and training and opportunity policies supportedby social derniicrats, with no dominant overall pattern. The pattern of reform is clearly influenced by the old social risk policies that compose the regime rype. However, even m corporarist countries with multiple veto-points in policy-making and high levels of union influence, reforms that cut back the systems of secure income replacement benefits established in the 'golden age' of the welfare state have been implemented, alongside the expansion of activation spending documented in Table 9.2. Responses to new social risks entail new directions in specific policy areas within the old risk welfare statesľ The expansion of child care and of policies designed to promote paid work shows that new social risks provide a context in which European welfare states are pursuing the mobilisation of those who encounter difficulty in gaining access to paid work alongside the provision of traditional services and benefits to meet old social risks. It is not surprising that the Nordic countries, where support for the worker-citizen is a central policy objective, lead Europe in new risk policy-making, nor that new social risks are seen by the European Union as a relatively undeveloped area, in which policy leadership can be offered and through which a transnational agency can seek to increase its contact with the lives of ordinary citizens. New risk reforms have tended, with some exceptions, tojojjowj^hjej^--tern of old social risks provision, and lead to the readjustment rather than the restructuring of welfare state regimes. Institutional structure makes a difference irijg^j^£^gg °r delaying change^and channelling it in particur lar directions, and in providing particular opportunities for compromise or for alliance between political actors. New social risks do not generate a new NLVV i-AKAUIuM and nlw politics? paradigm of welfare, nor do they lead to a new welfare state politics. Thev are rather to be seen as a modification^ but one which contradicts the~view that European welfare states face insuperable problems in adapting to new welfare needs. There are some indications that^ problems that face traditional welfare states ^^y.^sejf generate further n eJ^£^ksamongthosewhofa^^ _ The emphasis on mqbjlisation [gtop^d work through activation fits with the shift away from neo-Keynesian mU-empioyment economic man-agementin overall policy paradigm .Th e greater salience of child care also reflects ^c^nerťsin^^ It is in ejiiployment-centred issues that new social risk policy has made the strongest headway within the constraints of the various regime types. EU pursuit of the Open Method of Co-ordination recognises and acquiesces in these differences. The real progress in policy innovation indicates that the future of European welfare states continues to surprise and can be summed up neither in terms of the bleakness of a 'retreat to austerity' nor the intransigence of a 'frozen welfare landscape'. References ABI, 2002 What makes people save? Research Report, Association of British insurers, London. Adema, W. 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Index abortion reform, Germany 40 activation policies 243 European spending on 19,206 Finland 99,217-18 France 124-7, *33, 222 Germany 48,22s and Nordic welfare states SS Spain 146-7,152-4 Sweden 100, 217-1$ Switzerland 162,173-5 United Kingdom 19,69-72,75-6 Amsterdam Treaty (1997) 189, r9r, 102, 194-195.202, 204,210 apprenticeships, Germany 46, 47 austerity, and future of welfare state 7, 24-5 benefits: decline in average level or 7 Germany 48 Spain 152-4 United Kingdom 63, 71 Blair, Tony 65 Blüm, Norbert 46 Braun,Theo 12S capital mobility 6 Carers and Disabled Children Act (UK, 2000) 68 child care: and European Union 193,196, 200-7 Finland go, 92-3 France T17,129-30, r3i, 221 spending on 15-16 Germany 33, 38-9, 40, 41-2, sr, 221 and new risk policies 10, 243 politics of 234-5 Sweden 90, 92-3 Switzerland r64,165,i7S-9,22r United Kingdom 59, 62, 66, Ó7-8, 75-ó, 79 and women's labour force participation 17 Coiuche 11S COMETT programme 1.94 Committee on Social Justice (UK) 64 competitiveness: and new risk policies 10 and welfare policies 75 Conservative Party, policy discourse of 62-4 convergence, and new social risk policies 231 corporatist welfare state 13 and care spending 15 and labour force participation 21 women 17, iS and labour market activation spending 19 and new social risks 23-4 response to 221-5,230-1 and pensions 238 see also France; Germany; Switzerland decommodification, and welfare reform 14 demography, and ageing population 3, 6, S8-9 Denmark, and European Union 194 Duisenberg, W. 13 economic growth: and development of welfare state 1 Germany 223-4 Switzerland 163 trends in 6 uncertainty of 2 economic policy: and development of welfare state 1 and European Union 2r-2 and Keynesian paradigm 12 and monetarist paradigm 13-13,232 Spain 138 education: and employment 4 Finland 101 Spain 141 Sweden 101 and unemployment 4, 36, 60 vocational training 46, 47 elderly care: Finland 89, 90, 93-6 France 120-1,137-9,131,222 Germany 42.42-4,51,222 neglect of 235-6 and Nordic welfare states 88 Spain 155-Ó