Communication from the Commission to the Council, the European Parliament, the European Economic and Social Committee and the Committee of the Regions - Joint Report on Social Protection and Social Inclusion 2006
Date: 2006-02-13
Institutions: European Commission
Subjects: EU employment policy, European Union, European social policy, marginalisation, poverty, report, social integration

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COMMISSION OF THE EUROPEAN COMMUNITIES 

Brussels, 13.2.2006 
COM(2006) 62 final 

COMMUNICATION FROM THE COMMISSION TO THE COUNCIL, THE 
EUROPEAN PARLIAMENT, THE EUROPEAN ECONOMIC AND SOCIAL 
COMMITTEE AND THE COMMITTEE OF THE REGIONS 

Joint Report on Social Protection and Social Inclusion 2006 

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TABLE OF CONTENTS 

1. 

2. 

(a) 

(b) 

(c) 

Introduction .................................................................................................................. 3 

Overarching issues facing social protection and social inclusion policies. ................. 4 

Promote social cohesion and equal opportunities for all through adequate, accessible, 
financially sustainable, adaptable and efficient social protection systems and social 
inclusion policies.......................................................................................................... 4 

Interact closely with the Lisbon objectives on achieving greater economic growth 
and more and better jobs and with the EU's Sustainable Development Strategy. ....... 5 

Strengthen governance, transparency and the involvement of stakeholders in the 
design, implementation and monitoring of policy ....................................................... 7 

3. 

Key challenges in the different strands of work under the OMC ................................ 7 

3.1. 

Fighting poverty and exclusion: sustained effort but an implementation gap. ............ 7 

3.2 

3.3. 

Adequate and sustainable pensions: reform efforts continue....................................... 8 

Health and long-term care: first steps underline the importance of the issues in this 
field .............................................................................................................................. 9 

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COMMUNICATION FROM THE COMMISSION TO THE COUNCIL, THE 
EUROPEAN PARLIAMENT, THE EUROPEAN ECONOMIC AND SOCIAL 
COMMITTEE AND THE COMMITTEE OF THE REGIONS 

Joint Report on Social Protection and Social Inclusion 2006 

1. 

INTRODUCTION 

Europe's  policies  on  social  protection  and  social  inclusion  face  major  challenges.  Global 
competition,  the  impact  of  new  technologies  and  an  ageing  population  shape  the  long-term 
policy  context;  weak  growth,  high  unemployment  and  persistent  inequalities  need  to  be 
addressed  in  the  short  term.  At  Hampton  Court  in  October,  the  Heads  of  State  and 
Government  reflected  on  how  Europe's  social  systems  can  be  sustained  in  the  face  of  such 
challenges and how they can, at the same time, contribute to meeting them. The Commission's 
contribution,  strongly  endorsed  in  the  Presidency's  conclusions,  called  for  "strengthening 
instruments  like  the  EU’s  integrated  guidelines  for  growth  and  jobs  and  reinforcing  their 
interaction with more effective EU level co-ordination in the area of social protection." 

Earlier, the review of the Lisbon strategy in spring 2005 had posed a two-fold challenge for 
the  work  under  the  Open  Method  of  Coordination  (OMC)  for  social  protection  and  social 
inclusion.  It  found  a  gap  between  the  common  European  objectives  and  the  policies 
established to address them – for the OMC, this means that the process should move beyond 
identifying  broad  principles  to  focus  on  the  effectiveness  of  policies.  Secondly,  while 
restating the importance of the social dimension of the strategy, it sought a concentration of 
policy  effort  on  creating  higher  growth  and  more  and  better  jobs.  Thus  close  interaction 
between the social protection and social inclusion OMC, with its focus on providing a high 
level  of  social  protection  and  social  cohesion,  and  policies  for  employment  and  growth  is 
required. At the same time, the European Council called on the Union and the Member States 
to  give  priority,  under  the  social  inclusion  strategy,  to  improving  the  situation  of  the  most 
vulnerable young people and to initiatives to prevent educational failure as a contribution to 
the European Youth Pact.  

This  second  Joint  Report  on  social  protection  and  social  inclusion  responds  directly  to  the 
challenge  of  the  Hampton  Court  Summit  and  of  Lisbon,  and  builds  on  the  2003 
Communication  "Strengthening  the  social  dimension  of  the  Lisbon  strategy:  Streamlining 
open  coordination  in  the  field  of  social  protection"1.  It  draws  on  the  plans  and  policy 
statements  produced  by  the  Member  States  during  2005  under  the  three  policy  strands  of 
social  inclusion,  pensions,  and  health  and  long-term  care.  It  is  guided  by  the  views  on  the 
value  of  the  OMC  expressed  by  Member  States  and  stakeholders.  And  it  anticipates  the 
structure of OMC exchanges under the future streamlined process2. 

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COM(2003)261. 
See COM(2005)706. 

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2. 

OVERARCHING  ISSUES  FACING  SOCIAL  PROTECTION  AND  SOCIAL  INCLUSION 
POLICIES. 

The  Commission's  Communication  on  a  new  framework  for  the  OMC  outlines  three 
overarching challenges for policies in the social protection and inclusion fields. This section 
uses this framework to review current policies and reform strategies. 

(a) 

Promote  social  cohesion  and  equal  opportunities  for  all  through  adequate, 
accessible,  financially  sustainable,  adaptable  and  efficient  social  protection 
systems and social inclusion policies 

Member  States  have  to  meet  core  social  objectives  efficiently  and  cost  effectively  while 
adapting to new challenges and circumstances. To this end, in 2003 Member States spent on 
aggregate around 28% of GDP in gross terms on social protection, a figure which has edged 
upwards after being broadly stable over recent years. 

Systems of cash transfers (other than pensions) account for 5% of GDP. Reform efforts in this 
area are mainly focused on strengthening incentives to take up work. Use of in-work benefits 
to  support  incomes  for  those  making  the  transition  to  (low-paid)  employment  is  growing, 
albeit slowly. Social assistance is increasingly linked closely with locally provided social and 
employment  services  as  a  means  to  achieving  synergies  and  efficiencies.  Notable  reform 
efforts  relate  to  long-term  sickness/invalidity  schemes,  where  many  States  are  taking 
measures to ensure that they are not a form of disguised early retirement but promote a return 
to the labour market.  

Spending  on  pensions,  which  averaged  13%  of  GDP  in  the  EU  (in  2003),  has  ensured  that 
being old is no longer associated with being poor or being dependent on one's children. This 
has  mainly  been  achieved  through  the  provision  of  public  pensions,  and  the  adequacy  of 
retirement income will continue to be a public responsibility. The central pension challenge 
now, in an ageing society, is to increase the effective retirement age. Reforms are being made 
in most Member States to reverse the trend of previous decades which reduced the effective 
retirement  age  and  cope  with  future  increases  in  life  expectancy.  Public  pay-as-you-go 
pension  scheme  are  expected  to  remain  the  principal  source  of  income  of  pensioners  in 
coming decades, while the contribution of privately managed pension schemes is expected to 
increase in many but not all Member States. The solidarity principle continues to be important 
for our pension systems,  by  ensuring access for  all workers to pension provision, a form of 
guaranteed minimum for older people, a replacement income and finally the recognition for 
pensions of time spent out of the labour market (notably caring for children or older people 
and periods of unemployment). 

In health and long-term care, where spending averaged 8% of GDP in 2003, Member States 
continue to aim to ensure access for all to high quality care, while adjusting their systems to 
ever  growing  demand  linked  to  ageing,  patients'  expectations  and  technology  development. 
They  are  seeking  greater  effectiveness  and  efficiency  through  reorganisation,  prioritisation 
and  the  development  of  incentive  structures  to  users  and  providers.  Health  promotion  and 
disease  prevention  policies  are  expected  to  play  an  increasing  role.  To  ensure  that  health 
inequalities are not aggravated by a lack of access to care, the growing use of charges and co-
payments  is  accompanied  by  a  wide  array  of  reductions  of  fees,  targeted  at  disadvantaged 
groups.  

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Thus  the  pace  of  reform  in  social  protection  is  fast.  As  this  review  shows,  reforms  are  not 
synonymous  with  cutting  back,  and  their  impact  on  social  cohesion  should  be  carefully 
monitored.  Drawing  from  those  countries  with  the  longest  experience  suggests  that  good 
activation, involving integrated and tailored interventions, does not come cheaply and cannot 
be a quick-fix strategy. 

For  example,  increased  use  of  income-tested  minimum  retirement  provisions  should  not 
weaken incentives for pension saving. Minimum social assistance levels are already, in most 
Member States, below the at-risk-of-poverty line and, from a social inclusion perspective, the 
scope  for  attaching  conditions  to  them  needs  to  be  carefully  monitored.  The  growing 
emphasis on benefit conditionality is not, to date, accompanied by systematic monitoring of 
its impact on the most marginalised groups. The trend towards decentralising responsibility to 
the  regional  and/or  local  level  has  considerable  potential  for  integrated  delivery  of  social 
protection and social services. Again, however, the impact needs to be monitored. Evaluation 
must  also  be  “joined  up”  across  different  policy  spheres.  The  growing  use  of  health  co-
payments,  accompanied  by  measures  to  alleviate  their  cost  to  lower  income  groups,  has 
already  been  noted;  within  the  most  recent  inclusion  reports,  the  impact  of  increased  health 
and health insurance costs is seen as an increasingly significant pressure on people in lower 
income groups.  

(b) 

Interact  closely  with  the  Lisbon  objectives  on  achieving  greater  economic 
growth  and  more  and  better  jobs  and  with  the  EU's  Sustainable  Development 
Strategy. 

The  interaction  between  the  OMC  and  the  revised  Lisbon  process  should  be  a  dual  one  – 
social  protection  and  inclusion  policies  should  support  growth  and  employment  objectives, 
and  growth  and  employment  policies  should  support  social  objectives.  Among  the  Member 
States,  Belgium,  Hungary  and  Finland  offer  clear  examples  of  this  dynamic  interaction  in 
their National Reform Programmes (NRPs), by placing social objectives at the heart of their 
Lisbon planning, stating that their medium-term economic and employment planning should 
support the future sustainability and development of their social policies.  

Social protection and employment 

Reviewing  the  work  across  the  three  OMC  policy  strands  alongside  the  National  Reform 
Programmes, the role that social protection can play in improving employment performance 
emerges  strongly.  However,  links  between  the  OMC  and  the  NRPs  are  not  always  clearly 
drawn. 

In  the  fight  against  social  exclusion,  "facilitating  access  to  employment"  is  at  the  heart  of 
Member  States  strategies,  even  more  so  given  the  increased  stress  on  transition  to  work  in 
recent  reforms.  Active  labour  market  policies  and  a  review  of  tax  and  benefit  systems  are 
being  carried  out,  or  planned,  in  most  Member  States.  Where  economic  and  employment 
performances  have  been  good,  and  salaries  and  benefits  were  comparatively  low,  as  in  the 
Baltic  states,  employment  and  inclusion  policies  have  been  integrated  by  linking  a  rise  in 
benefit levels with a rise in minimum wages, as a means both to spread the benefits of recent 
growth and enhance incentives to work.  

A  number  of  Member  States  outline  in  their  NRPs  the  important  role  which  immigration  is 
expected to play in sustaining their labour markets in the future. However, acknowledgement 

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of  the  challenge  of  integrating  immigrants,  a  big  issue  in  recent  NAPs  for  inclusion,  is  not 
evident in the NRPs. 

Pension reforms affect employment directly, by strengthening incentives to work longer and 
restricting early exit from the labour market. By tightening the link between contributions and 
benefits, they also encourage activity and declared work across the whole working life cycle. 
But the success of this approach does not solely depend on the incentive structures of pension 
systems. A key issue for labour market reform and future NRPs is to open labour markets for 
older workers and to help them to remain in work longer, including through the efficient use 
of ICT. 

Good healthcare improves the quantity and quality of the labour force, and in particular the 
employability  of  older  people.  Moreover,  health  and  long-term  care  sectors  are  large 
employers and will become even more so in the future. Member States placed major emphasis 
in their preliminary policy statements on the challenge of ensuring adequate human resources 
to  meet  future  demands  on  the  sector.  How  systems  manage  the  future  supply  of  care, 
including  through  the  efficient  use  of  new  technologies,  will  have  important  employment 
implications.  The  balance  between  informal  care  (within  families,  outside  of  the  labour 
market)  and  formal  care  (through  social  services  or  market  mechanisms)  will  have  a  big 
impact  on  labour  supply,  particularly  of  women.  Health  issues  are  cited  in  broad  terms  as 
playing a part in future strategies by several of the new Member States, particularly Hungary.  

Social protection and growth 

Links  between  social  protection  and  growth  issues  can  clearly  be  drawn  in  the  area  of 
pensions.  Financially  sound  public  pensions  and  sustainable  public  finances  mutually 
reinforce  each  other,  which  in  turn  supports  long-term  economic  performance.  There  is 
general recognition of the importance of a healthy population – both the population as a whole 
and the older age group in particular – for economic growth. Regarding inclusion policy, the 
exclusion of people and groups, such as immigrants and ethnic minorities, from participation 
in work and society represents a waste of resources, to be addressed for economic as well as 
social  justice  reasons.  At  the  same  time,  the  sustainability  of  social  protection  schemes 
depends  on  growth  prospects  and  therefore  on  the  success  of  national  reform  strategies  to 
promote competitiveness and productivity.  

The  EU's  Sustainable  Development  Strategy3  outlines  long-term  aspirations  for  European 
society and threats and challenges to be addressed if we are to meet these aspirations. Social 
policy  concerns  form  part  of  both  the  aspirations  (e.g.  for  a  cohesive  society)  and  the 
challenges (e.g. gaps between rich and poor; ageing society). The perspective of sustainability 
places the long-term dimensions of social protection and social inclusion policies firmly in the 
policy  frame,  giving  added  impetus  to  focus  on  child  poverty,  through  which  poverty  and 
exclusion  pass  from  generation  to  generation  and  Europe's  future  human  resources  are 
diminished. More generally, it identifies a need for developing a focus on sustainability in the 
OMC. 

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COM(2001)264 and COM(2005)37. 

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(c) 

Strengthen  governance,  transparency  and  the  involvement  of  stakeholders  in 
the design, implementation and monitoring of policy 

One of the key policy messages emerging from work under the OMC is that policy making, 
and delivery, bears fruit if all actors, branches and levels of government work together. The 
OMC  has  had  some  impact  in  reinforcing  this  message,  particularly  in  the  social  inclusion 
area.  All  EU10  Member  States  have  created  new  structures  to  involve  civil  society  in  their 
social  policy  planning.  The  implementation  NAPs  of  the  EU15  reveal  a  wide  spread  of 
measures  to  improve  cooperation  between  central,  regional  and  local  authorities.  There  is 
clear  evidence  that  Member  States  have  been  learning  from  one  another.  Good  governance 
also  includes  the  aim  of  mainstreaming  social  inclusion  concerns  in  public  policy  making 
(including budget setting) and stronger evaluation and monitoring. In both these areas, there is 
progress but it has been limited. 

For pensions, it is essential that reforms, given their long-term impact, are built on consensus. 
Transparency  in  decision-making  is  needed  so  that  citizens  can  have  certainty  and 
understanding in the often complex task of planning retirement. Commitments to automatic or 
regular  review  mechanisms  help  citizens  to  plan.  Greater  decentralisation  of  funds  and 
increased  choices  regarding  investment  vehicles  or  retirement  ages  all  increase  complexity 
and need to be accompanied by means to provide information and guidance to citizens.  

At the level of systems, the health sector shows great complexity in the roles of insurers and 
providers, and of central and regional/local authorities. The interface between health providers 
and care providers will increasingly be crucial for efficient coordination. Clarity in the roles 
of  different  institutions  and  good  coordination  between  them  is  vital.  Relations  between 
policy makers and citizens are similarly important, given citizens’ high expectations of health 
systems  and  the  stress  placed  by  all  Member  States  on  promoting  prevention,  healthy  life 
styles and healthy ageing.  

3. 

KEY CHALLENGES IN THE DIFFERENT STRANDS OF WORK UNDER THE OMC 

3.1. 

Fighting poverty and exclusion: sustained effort but an implementation gap. 

The Implementation National Action Plans (NAPs) submitted by the EU 15 and NAP updates 
(submitted  by  four  of  the  EU10  States)  show  progress  in  several  fields  but,  against  the 
background of an economic performance which is at best mixed, no significant improvement 
in  the  situation.  They  show  clear  evidence  of  the  finding  in  the  Lisbon  review  of  an 
implementation gap between  what  Member States commit to in common objectives  and  the 
policy effort to implement them. 

Analysis of the 2005 reports confirms the seven key policy priorities identified in last year's 
Joint Report. These are: to increase labour market participation, modernise social protection 
systems, tackle disadvantages in education and training, eliminate child poverty and enhance 
assistance  to  families,  ensure  decent  housing,  improve  access  to  quality  services  and  to 
overcome  discrimination  and  increase  the  integration  of  people  with  disabilities,  ethnic 
minorities  and  immigrants.  The  reports  also  highlight  the  concentration  of  multiple 
disadvantages  in  certain  urban  and  rural  communities  and  among  some  groups.  Member 
States  need  to  develop  integrated  and  co-ordinated  responses  to  multiple  disadvantages  and 
the  needs  of  groups  at  particular  risk  such  as  people  with  disabilities,  migrants  and  ethnic 
minorities  (including  the  Roma),  homeless,  ex-prisoners,  addicts  and  isolated  older  people. 

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There  needs  to  be  both  improved  access  to  mainstream  provision  and,  where  necessary, 
targeted measures. 

Three current developments emerge more strongly. These are: challenges linked to increasing 
immigration; rising health and insurance costs; and the need for affordable care provision for 
children,  disabled  and  elderly  dependants  in  the  light  of  both  demographic  change  and 
increasing female labour force participation.  

Challenges  for  the  future  include  the  need  for  mainstreaming  –  i.e.,  to  better  integrate  the 
NAPs  with  national  policy  making,  including  budgetary  processes,  and  with  the  revised 
Lisbon  process;  better  governance  –  i.e.,  better  mobilisation  of  actors  and  links  between 
different  levels  (national,  regional  and  local)  of  government  and  clearer  responsibility  for 
implementation, monitoring and evaluation; and better links between the NAPs for inclusion 
and the Structural Funds, in particular the European Social Fund and the European Regional 
Development Fund. 

3.2 

Adequate and sustainable pensions: reform efforts continue 

The  second  round  of  National  Strategy  Reports  on  pensions  submitted  in  July  2005  shows 
substantial  progress  in  reforms4  since  the  2003  Joint  Report.  These  reports  highlight  the 
three  broad  objectives  of  adequacy,  sustainability  and 
interlinkages  between 
modernisation. For reform strategies to be successful, all three elements must be present and 
considered together. 

the 

To  ensure  adequate  and  sustainable  pension  systems  Member  States  are  implementing  the 
three-pronged  strategy  of  reducing  public  debt,  reforming  pensions  and  increasing 
employment. While some Member States aim at reducing public debt in order to create room 
to address the sustainability of pension systems, only a few countries have succeeded to do so 
in recent years. Member States also pursue increasing employment and many have undertaken 
reforms  that  have  begun  to  translate  into  higher  employment  rates  of  older  people: 
disincentives  to  working  longer  have  been  reduced  and  incentives  to  remain  active 
strengthened,  links  between  contributions  and  benefits  have  been  tightened  and  life 
expectancy has been further taken into account in the pension formula. Recent reforms tend to 
translate  into  a  decrease  in  replacement  rates  at  a  given  age,  which  can,  however,  be 
compensated by longer working lives and more saving, thereby maintaining the objective of 
adequate retirement income, avoiding pensioner poverty and maintaining a reasonable degree 
of  income  in  retirement.  Some  Member  States  are  increasing  the  level  of  guaranteed 
minimum  pensions;  many  recognise  periods  of  care  work  for  the  calculation  of  pension 
entitlements.  The  provision  of  supplementary  pensions,  which  in  some  Member  States  is 
expected to make a major contribution to maintaining living standards in retirement, has been 
developed  and  the  relevant  legislative  framework  strengthened.  While  the  contribution  of 
privately managed pensions is projected to increase over the coming decades, in all but a few 
Member States the public, pay-as-you-go schemes will remain the principal pension source. 
Concerns over unequal access to private pensions have been raised and some Member States 
are  reviewing  policy  responses,  including  substantial  fiscal  incentives  for  low  income 
workers. Linked to the greater use of privately managed pensions, Member States are moving 
to regulate and monitor systems to promote affordability and predictability of returns.  

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For  a  more  extensive  discussion  of  the  National  Strategy  Reports  2005,  see  the  Commission  Staff 
Working Document on Adequate and Sustainable Pensions (SEC (2006)XXXX). 

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A  new  feature  of  recent  reforms  is  the  introduction  of  automatic  or  semi-automatic  review 
mechanisms  that  ensure  periodic  monitoring  of  sources  of  pressure  on  the  pension  system, 
notably  demographic  trends,  and  force  a  debate  on  potential  policy  responses.  Such 
mechanisms  promote  transparency  of  pension  systems  and,  together  with  information  to 
citizens about their pension rights, build public confidence in them. 

3.3. 

Health and long-term care: first steps underline the importance of the issues in 
this field 

Following the 2004 Council decision to extend the OMC to the areas of health and long-term 
care, Member States submitted National Preliminary Policy Statements in spring 2005. These 
reports  identified  issues  for  further  work  and  contributed  to  the  Commission's  proposal  for 
common objectives5.  

The  aim  of  ensuring  access  continues  to  be  a  fundamental  challenge.  Serious  inequities, 
relating  to  supply  difficulties,  geographical  barriers  and  gender,  remain,  as  do  disparities  in 
how different socio-economic groups draw on health systems, and in the health outcomes they 
experience. In relation to long-term care, current provision is already seen as insufficient and 
will  become  more  so  given  demographic  development.  However  only  some  Member  States 
have  incorporated  the  future  care  challenge  into  their  social  protection  systems  or  have 
expanded  social  services  to  address  it.  The  challenge  of  human  resources  development  to 
sustain  health  and  long-term  care  services  in  the  face  both  of  increased  demand  and  scarce 
labour  resources  is  also  widely  flagged.  One  common  response  is  the  emphasis  placed  on 
promoting  prevention,  healthy  lifestyles  and  healthy  ageing.  In  relation  to  quality  of 
provision,  reforms  promote  the  development  of  indicators  and  setting  quality  standards, 
practice guidelines and accreditation systems. Such approaches will also promote cost saving. 
Involving patients and promoting choice is seen as a way of building quality. Technology has 
clear potential to improve quality, but its impact in terms of cost requires monitoring.  

Member States' efforts to secure financial sustainability focus heavily on increasing efficiency 
and  effectiveness.  Reforms  stress  the  need  for  coherence  and  better  coordination  between 
types  of  care,  avoiding  unnecessary  interventions.  Family  doctors  have  a  vital  role,  in  their 
curative,  guiding  and  gatekeeping  functions.  Actions  in  this  area  are  expected  to  impact 
positively  also  on  access  and  quality.  Sustainability  policies  also  aim  to  boost  incentives  to 
providers  and  users  to  use  resources  in  a  rational  way  by  promoting  cost-awareness  (cost-
sharing) and the use of primary care. Greater use of regulated competition is expected to bring 
about cost and quality gains.  

Carrying forward the OMC in a streamlined context: key messages 

From the analysis above, the following key messages can be distilled: 

•  There needs to be a more strategic approach to the formulation of NAPs for inclusion, to 
bring  about  more  precise,  systematic  and  transparent  setting  out  of  policies.  The  OMC 
needs to develop a strong focus on poverty among children and their families. The multiple 
exclusion faced by young people from ethnic minorities in poor neighbourhoods also needs 

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See  the  memorandum  of  the  Social  Protection  Committee,  Review  of  Preliminary  National  Policy 
Statements on Health Care and Long-Term Care, 2005. 

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increased attention. In this context, the fundamental role of education and training to break 
the intergenerational transmission of poverty should be highlighted. 

•  The  NSRs  on  pensions  highlight  the  interlinkages  between  the  three  broad  objectives  of 
adequacy, sustainability and modernisation and the synergies and trade-offs between them. 
For reform strategies to be successful, notably in dealing with increases in life expectancy, 
all  three  elements  must  be  present  and  considered  together.  Reforms  should  continue  to 
remove disincentives and strengthen incentives for working longer and need to be matched 
by  progress  in  how  employers  and  labour  markets  treat  older  workers.  This  will  make  a 
crucial  contribution  to  maintaining  adequacy  and  living  standards  and  fighting  pensioner 
poverty. The trend towards a decline of replacement rates provided by pensions should be 
carefully  monitored,  as  well  as  the  design  of  incentives  to  work  longer,  including  for 
potential beneficiaries of minimum benefits for pensioners. 

•  Modernisation of pension provision needs to take better account of new forms of working 
and  of  career  breaks  notably  for  care,  and  to  ensure  that  women  can  build  up  their  own 
pension rights. The development of private provision can complement public schemes, but 
affordability  and  security  need  to  be  ensured.  Regular  reviews  enable  the  systems  to  be 
adapted and information on people's pension entitlements helps to build confidence. 

•  Building  on  the  good  first  steps,  future  exchanges  on  health  and  long-term  care  should 
focus on how to ensure access and reduce inequalities; on adapting to evolving needs and 
increasing patient choice and involvement; promoting quality; securing sound financing of 
efficient systems; strengthening incentives to users and providers for rational resource use; 
promoting  prevention,  active  life-styles  and  healthy  ageing;  and  developing  human 
resource  strategies  to  meet  future  staff  shortages.  There  are  substantial  challenges  in 
relation to long-term care: to estimate future needs and to develop the necessary provision 
and funding mechanisms. 

•  The  challenge  of  ensuring  that  the  OMC  interacts  effectively  with  the  revised  Lisbon 
process  is  vital.  The  Commission  and  Member  States  should  develop  the  appropriate 
framework  to  ensure  the  best  interaction,  including  indicators,  to  measure  it.  This  will 
involve, for example, assessing the extent to which employment opportunities are reaching 
groups at highest risk of poverty (e.g. jobless households, the very long-tem unemployed, 
single  parents,  large  families,  young  people  at  risk,  ethnic  minorities,  people  with  a 
disability) and how reforms to promote employment impact on them. 

•  Looking  across  social  protection  systems  as  a  whole,  there  needs  to  be  a  long-term  and 
holistic approach which focuses on sustainability as a challenge not just for pensions and 
health;  on  indicators  to  monitor  the  effectiveness  and  efficiency  of  systems,  policies  and 
funding mechanisms; and on the distribution of spending across different branches and the 
balances to be struck between public provision and self-reliance. 

EN 

10 

   EN