Brussels, 09/10/2007 (Agence Europe) - The demographic changes and adjustments to the labour market that are currently being experienced means that the entire collective welfare system will have to be reformed and one can therefore ask which reforms member states should be making to update their social security system and more generally, their social protection system - in other words what is added to compulsory social security in order to protect against the dangers of life. Jerome Vignon, Director of Protection and Social Integration at DG Employment at the European Commission, recently discussed his ideas about social security.
The key novelty of the European system is the European social model, explained Vignon. If we compare the situation with the United States and Japan, what stands out in Europe is the scale of compulsory social security through legal measures, or quasi-compulsory via the social partners (trade unions and employers) but which are recognised in law, he explained, adding that social security expenditure in EU member states accounts for between 16% and 20% of GDP, double the spending often found in the United States, where private insurance schemes apply. Social security systems have to be updated to provide protection against life dangers which do not only include being unemployed, but also being unemployed into the long-term, because we have not adjusted to changes in the market, he said. These two risks would accumulate, added Vignon, arguing that the following is necessary: 1) increase the proportion of people in employment in order to improve taxation because there would be more tax-payers (if people work longer, it generates more income); and 2) adjust the social security system to allow people to work throughout their lives. Jerome Vignon commented that the slogan of modern social security will be supporting and maintaining work with greater personalisation of access to social security. He said social protection was organised as an 'Active Welfare State', which should encourage people to stay in work. He said there had to be a closer link between employment policy and activation of social security policy. The strategy to activate social security (which is described as one of the pillars of flexicurity) incorporates topics connected with the very essence of social security, like universal solidarity. He said that people living in poverty, people excluded from society due to illness, should be able to live a dignified life. Activation of social security was, he said, a balance between a new, more proactive orientation and the facilitating welfare state, but not at the risk of giving up on universality and support for human dignity. He argued that reforms of pension systems should make working longer pay, and this should be the slogan of pension systems in Europe.
Reforms are also required in healthcare, explained Jerome Vignon. The aim is to increase life expectancy while in good health, and this has a considerable impact on healthcare spending. Member states are therefore being asked to develop healthcare reform policies. Employment ministers are responsible for social security and health and safety at work, which is hugely contingent on the quality of work and working conditions, he explained. People are therefore moving towards a more integrated health and social security policy, with correct application of the Health and Safety at Work Directive.
In an active welfare state, the state would not simply correct situations when people lose their jobs but would also develop personal capacity. Commercially speaking, the active services are employment, education and coaching along with social housing, crèches, etc, explained Vignon. An active welfare state policy would attach importance to the quality of social services. Aid for helpers (who are also at work) becomes a question of a social service of general interest for the elderly, a question which is part of an active welfare state, he explained. Social services count as economic services, which means that competition rules apply to them, but the Services Directive has been adopted with exemptions like childcare services, family aid, etc. The crux of the report being prepared by Commissioner Vladimir Spidla on social services of general interest (see EUROPE No 9505) is clarifying the competition and internal market rules to decide whether they apply to exempt social services when they are considered as economic services, concluded Vignon. (gb)