Filenews 11 March 2022 - by Evagoras Prokopiou
The welfare state is that form of state which includes among its fundamental objectives the principle of social justice and intervenes in the economic area in order to redistribute to citizens a share of the national income and to guarantee a minimum level of decent living conditions.
A basic question that arises at the level of the European Union and especially at the country, whether the welfare state is viable and what are the main challenges facing the Social State today and in the near future?
According to the latest comparative data published by Eurostat in January 2021 and relating to the period 2018, Cyprus was lagging behind in the area of the provident state. According to this presentation, the state of social protection in Cyprus and expenditure amounts to 18.1% of GDP when the average of the European Union of "28" is 27.5%. The report on "Social protection in Cyprus revenue and expenditure 2018" issued by the Statistical Office states that France had the highest rate of social protection in terms of GDP with 33.7% followed by Denmark with 31.4%, Finland with 30.1%, Germany with 29.6% and Austria with 29.1%. However, from 2014 until 2018, expenditure in Cyprus increased year by year, with the annual change of 2017/2018 amounting to 4.3%.
Questions concerning the present and the future of the Cyprus Welfare State were raised with the Deputy Minister of Social Welfare Anastasia Anthousi and the heads of the two major trade unions, Andreas Matsas, General Secretary of SEK and Sotiroula Charalambous, General Secretary of PEO.
ANASTASIA ANTHOUSI, DEPUTY MINISTER OF SOCIAL WELFARE
THE OBJECTIVE IS THE EVOLUTION OF THE WELFARE STATE
The welfare state can only meet modern challenges if it takes account of changes in society. The conditions of the times are evolving and the needs of individuals are changing, so the welfare state must be constantly adapted so that the services provided are in line with real needs. The establishment of the Deputy Ministry of Social Welfare has exactly this as a goal: the modernization of services to address the real contemporary social challenges. This is the commitment of the state, the investment in social welfare and welfare to be sustainable in the long term.
We have recognized the necessity of the anthropocentric approach on which services need to be based, in order to have direct contact with people, creating an environment of trust and security. There is no doubt that immediacy will contribute to timely and targeted feedback from the social partners but also directly from the citizens themselves. Therefore, the effectiveness of a welfare state depends on two-way communication and cooperation. It is, of course, also based on the determination of the state to support and empower citizens by making them participants in the welfare state and active in society. It would be unfair for the people we support to always depend on welfare services and subsidy policy, making them inactive. We should not limit ourselves to support alone. The aim is to develop skills and empower individuals. The further strengthening of the individual comes to raise and highlight the involvement of other competent services, which will be crucial for the smooth functioning of a welfare state. The challenges of the time vary and cover many areas and an interdepartmental approach to sustainable social policy is needed.
One of the challenges today and in the near future is the complexity of the cases undertaken by the Services of the Deputy Ministry of Social Welfare. Interventions that in the past were sufficient to support the individual are no longer enough. The issues are changing and multiplying and their management needs expertise. The officers of the Social Welfare Services are called upon to deal with issues that differ significantly, responding to diverse needs, which makes targeted support difficult. Our priority is to launch the relevant trainings in order to specialize and train the officers in the management of specific issues, based on topics, in order to manage them more effectively.
An additional challenge is the regulation of the subsidy policy so that it is provided to people who really need support, while the involvement of other methods of social intervention is necessary. The integration of the Benefit Management Service into the Deputy Ministry of Social Welfare is a big step and we need to take the necessary actions so that the subsidy policy is complementary to social intervention. This is where the digital revolution comes in, which is the means that can facilitate procedures through the use of computer systems for direct information of services and the digitization of applications for allowances, in order to eliminate bureaucracy from paper applications. For example, the requesting citizen will have the possibility of electronic submission of the application in order to avoid repetitions and minimize possible errors. In addition, there will be the possibility of continuous information on the stage of evaluation of the application of each citizen.
Digitalization will save valuable time both to those served and to human resources within the services, since it will facilitate the processes through better cooperation between the services involved. Of course, better organisation and planning is needed to make it easier for both workers and citizens. The use of digital media must be implemented with the people served in mind. What instruments do citizens have at their disposal? Which age groups will be served? For which individuals is digitalisation an unknown direction from which they cannot benefit?
Adapting to the rapid development of technology will be a continuous effort of the Deputy Ministry. Moreover, the digital interconnection of all services and the detailed recording of data as well as their secondary analysis, in addition to the faster service of citizens and the tidying up of the procedures, will allow us to develop strategies aimed at preventing phenomena of violence, economic or other difficulty, or even to implement existing models based on the needs of society. However, the line is thin and that is why we need to adapt digital development to people and their real needs so as not to marginalize individuals or groups.
ANDREAS F. MATSAS SECRETARY GENERAL SEK
SOCIAL PROTECTION EXPENDITURE IS IN NEED OF SUPPORT
The welfare state is and reflects a part of the social state, which has a more institutional and legal meaning, while that of the welfare state has a more socio-political content, with more pronounced interventions and references to the social market economy. The main issue, however, concerns the degree and scope of intervention of the welfare state, in matters of health, education, wages and social security, housing, disability, as well as, of course, for vulnerable groups of the population, including pensioners.
Human dignity, as a basic component of the welfare state, is intertwined with the coexistence of the state and society, with the result that the institutional structures, as they stem from the Executive and legislative powers and are further strengthened by the Labour Advisory Body, consolidate participatory democracy.
On the basis of these realities, the role and responsibility of each government and all parliamentary parties and social partners is particularly important in the effort and in the process of co-shaping and strengthening the axis of social justice, social solidarity and the welfare state.
The existence of the welfare state, in combination with the institutional structures, enabled the adequate management of the economic crisis of 2013, as well as the immediate response to the effects of the pandemic, both on a health level, as well as on the economy, society and the labour market, on the basis of the support plans that have been implemented.
In addition, it is equally important to note that in a period of deep economic crisis, it became possible to establish the Guaranteed Minimum Income through which substantial support was given to a significant number of vulnerable fellow human beings.
Nevertheless, it should be shown that social protection expenditure in Cyprus needs to be further strengthened as, despite its strengthening from 17.9% of GDP in 2018 to 18.7% in 2019, it falls below the European average of 27.6%.
To this end, taking into account the high risk of poverty faced by people with disabilities, the elderly and vulnerable fellow human beings, in relation to the underdeveloped long-term care services, in a population that is demographically ageing, SEK believes that the following measures should be taken:
• Reducing the risk of impoverishment and social exclusion
• Strengthening and enhancing opportunities for quality education, training and linking the education system with the needs of the labour market, in order to enhance the possibilities of access to the labour market
• Consolidating the level of social cohesion and reducing inequalities and discrimination
• Strengthening family-work reconciliation policies, including the provision of paid parental leave
• Further support of the level and services of health care, further consolidating the role of the GHS
• Strengthening the judiciary, as a result of the reform being promoted
• Introduction of a national minimum wage, ensuring minimum living and pension levels above the poverty line
• Support for social security and the institution of provident funds as a second pillar of pension benefits, on the basis of the promoted reform of the pension system, which will include the elimination of the actuarial adjustment of 12% for those who choose to retire at the 63rd
• Enhancing accessibility to housing, especially for young couples
• Protection of children and the elderly, through the strengthening of social welfare services
• Strengthening demographic and family policy and better managing the migration issue
• Removing the lack of meritocracy and consolidating transparency, including wages, as well as consolidating and expanding the implementation of collective agreements.
Despite the challenges and changes that arise at the socio-economic level, as well as in the labour market, the welfare state is not only sustainable but also creates prospects for further strengthening. The European Pillar of Social Rights, the Recovery and Resilience Plan, also in relation to the management of the green transition, generates important references that link to the strengthening of the welfare state. At the same time, digitalisation will help speed up the management of applications and the payment of benefits, while also creating the urgent need for a smooth and balanced transition without social exclusions and social deficits.
Finally, the sustainable development of the welfare state and the social policy in general is fully interlinked with the strengthening and further exploitation of social dialogue, the targeted green and comprehensive tax reform, the fight against tax evasion and the strengthening of the state's tax collection capacity, as well as with the attraction of healthy investments.
In conclusion, the strengthening of the welfare state, on the basis of morality, proper and fairness, is not an expense but an investment in the consolidation of social justice and cohesion.
SOTIROULA CHARALAMPOUS SECRETARY GENERAL PEO
THERE IS A WAY TO HAVE A SOCIAL AND SUSTAINABLE STATE
One of the most important negative effects of the deep economic crisis of 2013 with the policies implemented, is the widening of social and economic inequalities.
This shift in wealth also led to an increase in poverty, reaching 16.2% in 2015. This percentage has fallen to 14.3% in 2019 but despite the decrease in poverty indicators in Cyprus, corrected in the way indicated by the European Statistical Office (Eurostat) so that the comparison with the poverty threshold in the year 2008 remains in 2019 at a level higher by 63% compared to 2008-2011.
In the conditions we have experienced in recent years, social policy could be a determining factor in the reduction of social inequalities. However, this did not happen because in Cyprus as in almost the whole of Europe, under the influence of the neoliberal economic perception, the approach to the role of the state in the conduct of social policy has changed.
From the perception of the social state, that is, the state that recognizes that education, health and housing, are social goods to which all citizens must have access so that they can participate in the productive development process, since social expenditure is also treated as a social investment, we have moved on to the perception that social expenditure is a burden on public finances, and that the role of the state is limited to providing some benefits for the poorest of the poor. This perception was expressed in the cuts in social benefits, in the attachment of the majority of social benefits and policies to the eu criteria, in the more and more assignment of social care and protection programmes to volunteering and the private sector through the method of purchasing services.
We need a radical overhaul of what is called the welfare state in Cyprus with the aim of responding to social realities and social needs by acting as a real mechanism for the redistribution of wealth.
Some very specific suggestions:
Policies to support the working family
In this area, there is a need to review the monetary benefits given to families – child and single-parent allowance – both in terms of income categories and in terms of the level of benefit. Of particular importance is the introduction of measures and policies that support new parents in the combination of family and work, especially in the chapter subsidizing the cost of childcare, expanding public services for the care of children and toddlers, especially by the local government. It is also necessary to introduce paid parental leave as well as to improve maternity and paternity leave.
A radical restructuring policy is also needed with the introduction of social housing programs and with rent subsidy programs based on income criteria.
Policies for people with disabilities also need to be improved considerably. An area in which over time we have had deficits and gaps that have swelled. The unblocking of policies of financial support for persons with disabilities from the EIO, with the introduction of specific legislation for persons with disabilities, the creation of adequate in quality and number of social protection structures for the integration and creative employment of persons with disabilities, as well as the improvement in the process of assessing persons with disabilities are some of the issues that need to be promoted.
Significant improvements also need to be made in the area of pensions with the central aim of ensuring adequate decent pensions for all.
Of course, the construction of a modern progressive Social State presupposes two more basic elements: Radical reorganization of social welfare services, through decentralization, its reinforcement with the necessary staff, with the development of services in the field and the assignment of a role to local government in the exercise of social policy by channelling the necessary financial resources. The second basic tool is the modernisation of legislation relating to social issues in such a way as to correspond to today's realities.
The question, "That's all well and good, but where are we going to find the money, how are we going to have a viable welfare state?" has an answer.
There is a way to have a social state and to make it sustainable through a proper tax policy that taxes wealth, and luxury, fights tax evasion and is effective in collecting what is due. What is needed is the right orientation, it is a return to what has been called the welfare state. It is the recognition that social protection expenditure is an investment and not a budgetary burden.
From the magazine "Insider" of February
