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The welfare state in Europe: still worth having?

Begg, Iain, (2016),” The welfare state in Europe: still worth having?”, LSE Blogs, 13 April

While there is some validity to these criticisms of European welfare states, they are also simply too crude to tell the whole story. Welfare states in Europe fulfil three distinct functions and it is crucial to understand the balance between these functions in assessing their sustainability and effectiveness in dealing with social risks. The first function is to offer an institutionalised means of savings for the population as a whole. Europeans have become accustomed to the idea that they should be net contributors to the welfare system during their working lifetimes, but then draw from the system in old-age through public pensions. Second, the welfare system redistributes economic resources in various ways. An example would be tax systems which take less (and sometimes even give money back – an issue that has been central to the UK renegotiation with the EU) from poorer people and more from richer people. This redistributive function has been described as ‘Robin Hood’ after the famous historical character who took from the rich and gave to the poor. A related effect is achieved by public services which facilitate the sharing of risk between vulnerable people and secure people, a good example being universal health care. If you are sick, no matter what your income is, you may face risks that you could not afford to cover on your own.

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