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Social protection represents a fundamental component of the European model of society.
It can be defined as all the collective transfer systems designed to protect a country's inhabitants against social risks. Each Member State remains responsible for the organisation and financing of its own particular social protection system. Given the common challenges facing the Member States in this area and in view of the strategy for convergence of social protection policies adopted at Community level, a European-level debate on these issues seems particularly appropriate. The level of indirect labour costs resulting from the burden of transfers to persons not in gainful employment is accused of being prejudicial to the development of employment, competitiveness and economic growth. However, social protection is crucial to the very working of our societies and is an essential vector of social cohesion.