Abstract
This article investigates the development of two forms of public spending on families, as well as their role for child poverty in 22 European countries during the period 2006–2015. It uses aggregated data on child poverty from Eurostat and data relating to public spending on families from the OECD SOCX database. It analyses the association between child poverty and public family spending on cash benefits and in-kind benefits, respectively. The findings show a stable growth in the GDP-related and real levels of spending on both cash benefits and benefits in kind, although spending on cash benefits have been more exposed to cost containment than spending on inkind benefits. Furthermore, spending on benefits in kind was found to be more efficient for curbing child poverty than spending on cash benefits, even after controlling for unemployment, family structure, the general standard of living, as well as welfare institutional configurations. However, the efficiency of public family spending declined over the studied period. Moreover, the relative significance of public family spending for child poverty, in comparison to structural factors (such as unemployment), varied according to which spending measure that was used.
Highlights
Social spending as a percent of GDP has been shown to protect families and children from poverty, even when controlling for household-level factors and other macro-level characteristics as the unemployment rate, affluence and the total level of welfare state generosity (Bárcena-Martín et al 2017; Chzhen 2017; Muffels and Fourage 2004)
Whereas a ‘service-based’ approach emphasising spending on benefits in kind would be more in accordance with the dual-earner idea within the increasingly influential Social Investment Strategy (Bonoli 2005; Esping-Andersen et al 2002), a ‘transfer-based’ approach would be more in line with a traditional family policy approach that aims at combating poverty primarily through cash benefits and tax reliefs (Thévenon 2011)
This ‘era of austerity’ influenced countries in different ways, but it may be assumed that spending on cash transfers to families have become more subjected to austerity measures than spending on services, since the latter is more in line with the EU Social Investment Strategy and the UN Sustainable Development Goals (Chzhen 2017)
Summary
Social spending as a percent of GDP has been shown to protect families and children from poverty, even when controlling for household-level factors and other macro-level characteristics as the unemployment rate, affluence and the total level of welfare state generosity (Bárcena-Martín et al 2017; Chzhen 2017; Muffels and Fourage 2004). As the recession following the financial crisis exposed most European countries to mounting fiscal challenges, they became more prone to engage in fiscal consolidation since 2010–2011 (Taylor-Gooby et al 2017; Farnsworth and Irving 2015) This ‘era of austerity’ influenced countries in different ways, but it may be assumed that spending on cash transfers to families have become more subjected to austerity measures than spending on services, since the latter is more in line with the EU Social Investment Strategy and the UN Sustainable Development Goals (Chzhen 2017)
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