These were the questions I had in mind when addressing the recent JEF-Europe / Europeisk Ungdom seminar in Finnskogen, Norway; this article is the conclusion of my presentation there and reflects the debate and thoughtful questions posed.
First and foremost, is ‘Social Europe’ synonymous with Social Policy and/or Welfare Policy, or might it mean something else? If we are talking of EU Social Policy, we must start by discussing money. Social policy is expensive, very expensive.
More than 40% of GNI (Gross National Income) in the EU is in the hands of the public sector. Only 1% of GNI is committed to the EU budget, some €100 billion per year. The Department of Work & Pensions, the UK ministry responsible for most aspects of social policy, alone has a budget of £115 billion (€186 billion) per year!
Most European states spend more than 6% of GNI on healthcare, and 10% of GNI on social policies such as pensions and unemployment benefits. Simply put, the European Union is not going to come close to matching that degree of funding any time soon, especially as Member States have even been looking to cut the EU budget rather than increase it.
Having said that, many commentators and politicians alike  have stated that they fear that today’s European social and welfare policies are not fit for purpose. States such as Italy and France are burdened with debt, and yet face the additional challenge of ageing populations and greater strain on pensions.
Further, if any European state suffers severely as a result of these pressures, we all suffer due the considerable economic interdependence within the Single Market. On the other hand, citizens remain broadly content with the performance of their own welfare states; social policy concerns rank far below economic concerns in the recent Eurobarometer 65 .
What role for the EU if any?!
Simply put, traditional areas of social policy cost a lot and the EU does not have the budgetary clout to play a role in these areas in the near future, even if it wanted to. So what can and should it be doing?
Before we start to talk about a Social Europe, the EU’s focus must be economic growth and the Single Market. Unemployment remains EU citizens’ prime concern, and while unemployment remains high and economic growth sluggish, so national welfare states remain under strain.
It is however vital that the EU approaches its economic policy with an eye to its impact on citizens’ perceptions of their national social policies. Previous initiatives such as the Services Directive have been too easy for eurosceptics on the left to portray as efforts to remove social protection. Whether this is or is not true is not true for the Services Directive is not an issue I wish to pursue here; the EU simply must deal with the matter of these perceptions.
The EU can legitimately claim to be enacting good social policy; e.g. it determines issues relating to workers’ rights (working time, gender balance, rights of ethnic minorities).
Furthermore, the European Union - with its limited financial and political resources - has been perceived to be capable of destroying treasured national entities, yet not being capable of installing adequate replacements instead. Take the example of France’s national railway firm, SNCF, which has restructured in light of EU railway liberalisation. The message the citizens get is that the EU is challenging a part of the French psyche, whereas the real aim is to get more passengers and freight on the railways - a very noble and one might argue also social aim. From its challenges to Svenska Spel, to SNCF, to Gas Natural and to Alitalia, the EU needs to communicate the social benefit of the legislation they hope to enact; if there is no social benefit, then is it worth reconsidering the legislation? Challenging national monopolies and state-controlled enterprises is not wrong in itself, yet the EU must always be aware of the many complex sensitivities involved.
Beyond the market issues, there are additional areas where the EU can legitimately claim to be enacting good social policy. The EU determines issues relating to workers’ rights (working time, gender balance, rights of ethnic minorities), and has a legitimate claim to have boosted protection in these areas. The European Union may additionally be able to encourage Member States to cope with their impending demographic problems, an issue that states have failed to address of their own accord. Yet these matters are peripheral in comparison to the big spending issues that dominate everyday social policy.
Simply put, a Social Europe might well be defined as the antithesis to a raw free-market Europe; while the EU might not make traditional social policy of its own accord, it must ensure it does not seek to damage important aspects of social protection that remain national competences. In addition, the EU might in the short term be able to carve out additional niche areas where it can play a social policy role, but do not have any expectations (or wish?) for anything major.