The (changing) consideration of social investment in the design of welfare benefits: The case of poverty relief in Austria

Karin Heitzmann,Sandra Matzinger

doi:10.1111/spol.12643

Abstract

AbstractThe social investment perspective has become a prominent topic in both social policy discussions and theoretical considerations regarding welfare state change. Empirical evidence on how this perspective has affected welfare state provision is much scarcer—and sometimes contradictory. This article aims to assess whether welfare state benefits increasingly have incorporated elements of social investment, and what has triggered the reforms made to the benefits. To achieve these aims, we examined two poverty relief benefits in Austria, namely, unemployment assistance and social assistance. We scrutinized changes made to these benefits from 2000 onwards. To identify their (potentially changing) contributions towards social investment, we applied a framework that considers the economic aims of the paradigm (while neglecting other aims). According to this framework, a social investment benefit intends to improve the human capital of its recipients, enhance their employability, and/or enhance their employment integration. The findings suggest that the three elements of social investment were particularly relevant in reforming social assistance. However, the changes implemented were incoherent and do not support the hypothesis of an ever‐increasing significance of social investment. The main triggers for reform were the political ideologies of (changing) governments. These ideologies determined the direction of changes made to both social assistance and unemployment assistance. If social investment thus ought to be more than just a theoretical concept or a nonbinding policy recommendation, modifications made to welfare state benefits would need to follow a more coherent path. Regarding poor relief benefits, Austria has not pursued such a track (yet).

Highlights

We illustrate changes made to two poverty relief benefits in Austria within the last two decades (2000–2019)
We start by providing some background information on the role of the two poor relief benefits examined, namely, unemployment assistance and social assistance
This article set out to examine whether reforms made to the design of poverty relief benefits in Austria during the past two decades increasingly have considered elements of social investment

Summary

Introduction

The concept is projected to allow combating poverty, and preventing the intergenerational transmission of poverty This should make benefits targeted to the poor relevant in judging whether and to what extent welfare states already have implemented social investment policies. While several empirical studies investigate the contributions of social investment in combating poverty or inequality more generally (Cantillon, 2011; Rovny, 2014; Solga, 2014; Taylor-Gooby, Gumy, & Otto, 2015; Vaalavou, 2013; Van Vliet & Wang, 2015), they usually do not focus on the contributions of poverty relief benefits in achieving these outcomes. Concerning the latter, both different governmental compositions and external influences (such as the financial crisis of 2008/2009) are likely factors to explain changes made to the benefits

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Conclusion