ERODING MINIMUM INCOME PROTECTION
IN THE NORDIC COUNTRIES?
REASSESSING THE TYPICAL CHARACTER OF
NORDIC SOCIAL ASSISTANCE
Forthcoming in Fritzell, J., Hvinden B., Kangas, O., Kvist, J
(eds.) ”Changing Equality: The Nordic Welfare Model in the
21st Century”, Policy Press.
Kenneth Nelson
Institute for Social Research
Stockholm University
Kennethn@sofi.su.se
The purpose of this study is to analyze Nordic
social assistance and minimum income benefits
from the early 1990s up to the end of 2010 in
Denmark, Finland, Norway and Sweden.
***
Is Nordic social assistance moving in the direction we would
expect from the recognition of an encompassing or universalist
Nordic model?
To what extent does Nordic social assistance prevent and
alleviate poverty?
Have institutional and other changes in Nordic social assistance
promoted convergence with other advanced welfare states?
Social assistance in the Nordic countries is often
characterized as a marginal but effective program,
providing fairly generous benefits for a small
proportion of the population.
(e.g. Lødemel and Schulte 1992; Leibfried 1993; Eardley et al.
1996; Gough et al. 1997; Lødemel 1997; Gough 2001)
Five indicators covering institutional
characteristics and outcomes
•
•
•
•
•
Benefit Levels
Benefit Adequacy
Means-Tested Benefit Expenditure
Poverty among social assistance recipients
Anti-poverty effects of social assistance
Method
Descriptive analysis covering both levels and changes
The Social Assistance and Minimum Income
Protection Interim Dataset (SaMip)
●
●
●
●
●
34 countries 1990-2009
Institutional variables on benefit levels
Based on type-cases
Gender dimension
Information about child benefits, housing benefits,
and negative income taxes.
Table 1. Minimum Income Protection Benefit Levels, Adequacy Rates, and Means-Tested
Benefit Expenditure as percentage of Total Social Benefit Expenditurein in Different Countries
1990 and 2009.
Denmark
Finland
Norway
Sweden
Average Nordic Countries
Germany
Netherlands
United Kingdom
Avarage 20 countries
1990
2009
1990
2009
1990
2009
1990
2009
1990
2009
1990
2009
1990
2009
1990
2009
1990
2009
Benefit Levels (PPPs)
11510
20329
11299
18747
9729
23568
11331
17090
10967
19933
9844
18472
9609
17238
8262
17503
9393
16724
Adequacy Rates
56.4
48.5
56.2
48.4
44.0
46.7
61.5
44.0
54.5
46.9
49.5
52.0
54.8
43.4
42.8
38.8
50.4
42.8
Expenditure
4.3
5.1
7.2
5.6
7.2
6.8
2.9
1.9
5.4
4.8
5.5
9.0
10.2
8.6
12.7
10.2
10.3
8.5
Note: The larger group of countries for which average values are calculaded includes for means-tested benefit
expenditure 18 countries (see note to figures 3a-b), for adequacy 13 countries (see note to figures 2a-b).
Adequacy is shown for the years 1990 and 2008, wheras means-tested benefit expenditure is shown
for the years 1990 and 2007.
Source: SaMip.
Table 1. Minimum Income Protection Benefit Levels, Adequacy Rates, and Means-Tested
Benefit Expenditure as percentage of Total Social Benefit Expenditurein in Different Countries
1990 and 2009.
Denmark
Finland
Norway
Sweden
Average Nordic Countries
Germany
Netherlands
United Kingdom
Avarage 20 countries
1990
2009
1990
2009
1990
2009
1990
2009
1990
2009
1990
2009
1990
2009
1990
2009
1990
2009
Benefit Levels (PPPs)
11510
20329
11299
18747
9729
23568
11331
17090
10967
19933
9844
18472
9609
17238
8262
17503
9393
16724
Adequacy Rates
56.4
48.5
56.2
48.4
44.0
46.7
61.5
44.0
54.5
46.9
49.5
52.0
54.8
43.4
42.8
38.8
50.4
42.8
Expenditure
4.3
5.1
7.2
5.6
7.2
6.8
2.9
1.9
5.4
4.8
5.5
9.0
10.2
8.6
12.7
10.2
10.3
8.5
Note: The larger group of countries for which average values are calculaded includes for means-tested benefit
expenditure 18 countries (see note to figures 3a-b), for adequacy 13 countries (see note to figures 2a-b).
Adequacy is shown for the years 1990 and 2008, wheras means-tested benefit expenditure is shown
for the years 1990 and 2007.
Source: SaMip.
Table 2. Poverty and Poverty Alleviation of Means-Tested Benefits, Around 1990 and 2005.
Denmark
1992
2004
Finland
1991
2004
Norway
1991
2004
Sweden
1992
2005
Average Nordic Countries Around 1990
Around 2005
Germany
1989
2004
Netherlands
1991
1999
United Kingdom
1991
2004
Avarage 15 countries
Around 1990
Around 2000
Source: Luxembourg Income Study.
Poverty
28.4
34.5
17.3
34.2
17.3
42.7
19.7
36.3
20.7
36.9
36.4
47.0
22.7
32.8
56.2
26.7
29.9
37.7
Poverty Alleviation
41.9
45.1
35.4
32.4
32.4
27.3
53.0
41.0
40.7
36.4
22.1
28.2
33.2
30.9
19.7
38.5
30.2
31.3
Table 2. Poverty and Poverty Alleviation of Means-Tested Benefits, Around 1990 and 2005.
Denmark
1992
2004
Finland
1991
2004
Norway
1991
2004
Sweden
1992
2005
Average Nordic Countries Around 1990
Around 2005
Germany
1989
2004
Netherlands
1991
1999
United Kingdom
1991
2004
Avarage 15 countries
Around 1990
Around 2000
Source: Luxembourg Income Study.
Poverty
28.4
34.5
17.3
34.2
17.3
42.7
19.7
36.3
20.7
36.9
36.4
47.0
22.7
32.8
56.2
26.7
29.9
37.7
Poverty Alleviation
41.9
45.1
35.4
32.4
32.4
27.3
53.0
41.0
40.7
36.4
22.1
28.2
33.2
30.9
19.7
38.5
30.2
31.3
Conclusions
Nordic social assistance is still marginal, generous, and
effective for poverty alleviation compared to
international standards. However, these peculiarities of
Nordic social assistance seem to be less distinct
nowadays then about two decades ago. To this extent
there seems to be some convergence going on.
Nordic social assistance has become less generous and
effective for poverty alleviation, particularly
developments in Sweden and Finland are worrying.