Fighting poverty and social exclusion in Europe
The European Parliament has recently published a new study written by FGB to explore the solutions for mitigating the risk of poverty and social exclusion in the EU.
Despite positive developments over the last few years, almost 91.4 million EU citizens, including 69.4 million in the euro area, were still at risk of poverty or social exclusion in 2019, and these numbers are expected to be increased by the COVID-19 crisis.
This issue has recently led to a number of European level initiatives aiming to address poverty and social exclusion, including the European Child Guarantee, the Porto Declaration, the ESF+ and the anti-poverty dimension of the Recovery and Resilience Facility.
Minimum income schemes have also been identified as an important tool to fight poverty, and have been introduced on a national level in many European states. However, despite several calls for EU-wide, binding legislation defining a common framework for minimum income schemes, this has not yet come to fruition.
The study Fighting poverty and social exclusion in Europe written by Michele Raitano (Università Sapienza di Roma), Matteo Jessoula (Università degli Studi di Milano), Giovanni Gallo (Università della Sapienza di Roma) and Costanza Pagnini (Fondazione Giacomo Brodolini) for the European Parliament’s committee for Employment and Social Affairs, discusses the main questions which should inform such legislation: How best to measure poverty? How should we define the eligibility for minimum income schemes? What are the key features of national minimum income schemes? What EU-level actions are possible in this regard?
The first part of the study offers a critical assessment of the concepts used to measure poverty, discussing the limitations of different indicators and data with reference to EU countries. It also highlights the intersection between individuals' poverty status and eligibility for anti-poverty transfers.
The second part then focuses on national and EU-level policies dealing with poverty and social exclusion, in particular minimum income schemes, presenting 6 country case studies and evaluating the feasibility of an EU-wide minimum income framework.
The main conclusions of the study are that, due to the multi-faceted nature of poverty, several indicators are necessary to capture its various dimensions, and no single policy is sufficient to combat it. Rather a mix of both predistributive measures – affecting market outcomes and skills development – and purely redistributive measures such as minimum income schemes are required to address poverty.
The study also calls for great attention and transparency when setting the eligibility levels for social benefits, careful assessment of coverage and the amounts offered in benefit packages, and the simplification of access procedures in order to ensure a higher take-up rate of minimum income benefits.