Joint report on social protection and social inclusion 2009 : social inclusion, pensions, healthcare and long-term care : summary.
Date: 2010-01-14
Institutions: Directorate-General for Employment, Social Affairs and Inclusion
Subjects: EU Member State, activity report, social integration, social policy, social security, summarising

JOINT REPORT ON 
SOCIAL PROTECTION 
AND SOCIAL INCLUSION 2009 - SUMMARY 
Social inclusion, pensions, 
healthcare and long-term care

European Commission

1

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This publication has been prepared under the European Community Programme 
for  Employment  and  Social  Solidarity  –  Progress  (2007-2013). The  programme  is 
managed  by  the  European  Commission’s  Directorate-General  for  Employment, 
Social  Affairs  and  Equal  Opportunities.  Progress  was  established  to  provide 
financial support for the implementation of the European Union’s objectives in the 
employment  and  social  affairs  area,  as  set  out  in  the  Social  Agenda,  and  thereby 
contribute to the achievement of the Lisbon Strategy goals in these fields. 

The seven-year Programme targets stakeholders who can help shape the development 
of appropriate and effective employment and social legislation and policies, across 
the EU-27, EFTA-EEA and EU candidate and pre-candidate countries.

The  mission  of  the  Progress  programme  is  to  strengthen  the  EU’s  contribution 
in  support  of  the  Member  States’  commitments  and  efforts  to  create  more  and 
better  jobs,  and  to  build  a  more  cohesive  society. To  that  effect,  Progress  will  be 
instrumental in:

•  providing analysis and policy advice on Progress policy areas; 
•  monitoring and reporting on the implementation of EU legislation and 

policies in Progress policy areas; 

•  promoting policy transfer, learning and support among Member States 

on key EU objectives and priorities; and
relaying the views of relevant stakeholders and society at large.

• 

For more information see:
 http://ec.europa.eu/progress 

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JOINT REPORT 
ON SOCIAL PROTECTION 
AND SOCIAL INCLUSION 2009

SUMMARY

Social inclusion, pensions, 
healthcare and long-term care

European Commission

Directorate-General for Employment, Social Affairs and Equal Opportunities
Units E.2 and E.4 
Manuscript completed in June 2009

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Neither the European Commission nor any person acting on behalf of the Commission may be held 
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Luxembourg: Publications Oﬃ  ce of the European Union, 2009

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Reproduction is authorised provided the source is acknowledged.

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TABLE OF CONTENTS

INTRODUCTION .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  5

THE SOCIAL IMPACT OF THE ECONOMIC CRISIS .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  8
More citizens claiming beneﬁ ts  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  8
Contribution of social policy  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  9
Strengthening solidarity   .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  9
Role of the European Social Fund .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  9

FIGHTING POVERTY AND SOCIAL EXCLUSION .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .   10
Helping children out of poverty .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .   11
Promoting the social inclusion of Roma .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .   11
Active inclusion  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .   12
Migrants .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .   12
Disabled people .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .   13
Tackling homelessness .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .   13
Addressing educational disadvantages .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .   14
Addressing ﬁ nancial exclusion .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .   14

ADEQUATE AND SUSTAINABLE PENSIONS  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .   15
‘Adequacy’ and ‘sustainability’ deﬁ ned  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .   15
More people in work and for longer  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .   16
Ensuring pension adequacy  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .   17
Funded pension schemes .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .   17
Impact of the crisis on funded pension income  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .   18
Minimum income provisions .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .   18

UNIVERSALLY ACCESSIBLE HEALTHCARE AND LONGTERM CARE   .  .  .  .  .  .  .  .  .  .  .  .  .   19
Improving healthcare systems    .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .   19
Access to healthcare for all  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .   20
Quality of healthcare    .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .   21
Sustainability and coordination .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .   21
Long-term care   .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .   21

CONCLUSIONS .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .  .   22

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INTRODUCTION

INTRODUCTION

This leafl et presents the main fi ndings of the 2009 Joint Report on Social Protection and Social 
Inclusion and reviews the principal trends across the European Union (EU) and at national lev-
els within these areas. 

The 2009 Joint Report is based on Member States’ National Strategic Reports (NSRs), doc-
uments in which they present their strategies on how they intend to promote the EU’s 
common social objectives. Presented to the European Commission in autumn 2008, the 
NSRs cover the period 2009-11 and focus on three main areas – social inclusion; pensions; 
and healthcare and long-term care. The aim is for the key messages emerging from the 
report to drive policy eﬀ orts in the areas of social protection and social inclusion over the 
coming years.

Action at EU level
The EU works to promote social inclusion and social protection through the Social Pro-
tection and Social Inclusion Process. This sees the EU coordinate and encourage Mem-
ber  States’  eﬀ orts  to  combat  social  exclusion  and  poverty,  and  to  reform  their  social 
protection systems, on the basis of shared experience. Action at EU level is based on 
agreed common EU-wide objectives which Member States implement by means of na-
tional action plans. Meanwhile, EU funding is made available for activities to support 
these eﬀ orts.

The EU’s system of common objectives, common indicators, assessment and reporting 
for social protection and inclusion – the open method of coordination (OMC) – operates 
in tandem with the EU Strategy for Growth and Jobs. The Joint Report on Social Protec-
tion and Social Inclusion is a key feature of the OMC (see box). 

Open method of coordination
The EU approach to social policy is based on the OMC: a mechanism to coordinate Mem-
ber  States’  economic,  employment  and  social  policies.  The  aim  is  to  progress  towards 
common European goals while giving individual countries the choice of deﬁ ning the poli-
cies for how best to achieve them. Under the OMC, the Member States draw up national 
action plans outlining priorities and planned actions, with the European Commission sup-
porting and monitoring progress.

5

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Joint Report on Social Protection and Social Inclusion 2009 – Summary
Social inclusion, pensions, healthcare and long-term care

The economic situation
Presented at the end September 2008, the Member States’ NSRs were prepared before 
the fallout of the ﬁ nancial crisis on the real economy took hold. Although these devel-
opments  could  not  be  anticipated  in  the  NSRs,  Member  States  and  the  Commission 
have agreed that the reports are still relevant, and that the actions envisaged to help 
achieve the shared social objectives have become all the more urgent. In particular, ap-
propriate social policies should simultaneously support the goals of mitigating adverse 
social impacts on the most vulnerable and of containing the impact of the crisis on the 
economy overall.

Social inclusion
Some 16% of the EU population – or 79 million people – are at risk of income poverty, and 
for children and the elderly, this proportion is even higher. Poverty has multiple roots: 
poor housing, insuﬃ  cient skills, a lack of real access to healthcare and other vital services, 
an inability to access the labour market — all these factors, particularly in combination, 
can prevent citizens from being able to fully participate in society.

Social inclusion is about making sure that everybody, including vulnerable groups, can 
play  a  full  part  in  work  and  society  and  that  they  have  an  equal  opportunity  to  do  so. 
Promoting social inclusion is also vital to achieving the EU’s goals of sustained economic 
growth, more and better jobs and greater social cohesion.

With 2010 being the European Year for Combating Poverty and Social Exclusion, 
the EU is to reaﬃ    rm its commitment to making a decisive impact on the eradication 
of poverty and social exclusion by then.

6

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INTRODUCTION

Social protection
Social protection systems are highly developed in the EU. They protect people against the 
risks of inadequate incomes associated with unemployment, illness and invalidity, paren-
tal responsibilities, old age or inadequate income following the loss of a spouse or parent. 
They also guarantee access to services that are essential for a life in dignity. 

However, inequalities persist and in a fast-changing world, social protection systems are 
facing new challenges. In particular, the principal threats come from the ageing popula-
tion, with the proportion of citizens aged 65 and over projected to rise by 77% by 2050. 
Member  States  are  therefore  reforming  their  pensions,  healthcare  and  long-term  care 
systems in order to ensure universal and sustainable access.

The  EU  supports  the  modernisation  of  social  protection  systems  with  a  view  to 
ensure social justice for all and promote the active participation of all in society. 

Role of social protection expenditure
Social protection serves to cushion poverty, but it also helps insure people against im-
portant  social  risks.  A  closer  look  at  social  protection  expenditure  shows  that  old-age 
pensions and sickness and healthcare beneﬁ ts represent the bulk of spending in all EU 
Member States (see ﬁ gure). This is why when assessing the preventive role of social pro-
tection, it is necessary to look in particular at the resilience of pension systems and access 
of citizens to healthcare.

Social protection beneﬁ ts (% of GDP, 2006)

30

25

20

15

10

5

0

EU27

LV

EE

LT

RO

BG

SK

IE

CZMT

CY

PL

LU

ES

HU

SI

EL

PT

FI

IT

UK

NL

DE

AT

DK

BE

FR

SE

Old age and survivors

Family/Children

Sickness/Health care

Unemployment 

Disability

Housing and Social exclusion 

Source: Eurostat.

7

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Joint Report on Social Protection and Social Inclusion 2009 – Summary
Social inclusion, pensions, healthcare and long-term care

THE SOCIAL IMPACT OF THE ECONOMIC CRISIS

Recent  employment  statistics  clearly  show  the  impact  of  the  fi nancial  downturn  on  labour 
markets. The EU unemployment rate reached 8.3% in March 2009, for example, from a low 
of 6.7% in March 2008. Some countries like Estonia, Spain, Ireland, Lithuania and Latvia have 
been particularly adversely aff ected. 

Unemployment rate (%) 

EU (27 countries)

%

8.5

8

7.5

7

6.5

6

April

May

June

July

August

September

October

November

December

January

February

March

2008

2009

Note: The chart shows unemployed persons as a percentage of the labour force (total number of people employed and 
unemployed). 
Source: Eurostat.

More citizens claiming beneﬁ ts
In recent months unemployment has risen considerably in the EU as a whole and in most 
Member States, especially as regards certain groups such as the young, those on tem-
porary contracts and migrants. Information collected by the Social Protection Commit-
tee suggests that most Member States expect social assistance schemes to be put under 
pressure as some people currently covered by unemployment insurance may lose their 
entitlements before ﬁ nding a new job. In addition, the percentage of older workers claim-
ing early retirement or disability has already started to grow in some countries.

In some countries, the number of households defaulting on their mortgage payments 
or facing repossession is rapidly escalating. Increased rates of over-indebtedness and 
issues  with  access  to  credit  for  individuals  have  also  been  reported.  Funded  pension 
schemes face a sharp decline in the value of investments backing pension liabilities.

8

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 THE SOCIAL IMPACT OF THE ECONOMIC CRISIS

Contribution of social policy
Social protection systems play the role of ‘automatic stabilisers’ by helping to cushion the 
impact of the economic downturn on citizens, in particular the most vulnerable. Given 
the current outlook, social protection expenditure is projected to grow, although Mem-
ber States vary in their capacity to meet this increasing demand. 

The most badly hit victims of the crisis will likely be vulnerable households at a disad-
vantage in the labour market and in society. Hence the need for social safety nets which 
are tight enough to prevent people from falling through and eﬀ ective enough to launch 
them back into active social and labour market participation.

Strengthening solidarity
One  way  to  mitigate  the  eﬀ ect  of  the  economic  crisis  and  help  recovery  is  to  build  on 
the values that underpin the EU’s social policies and progress in system reforms. Recent 
structural reforms in the ﬁ eld of social security have delivered results, bringing more peo-
ple into employment, better ensuring that work pays and strengthening the resilience 
of labour markets, prolonging working lives and supporting economic growth. Further 
reinforcing the positive mutual interaction with action for growth and jobs is vital, no-
tably giving more attention to eﬀ ective policy integration and mainstreaming of social 
concerns in other policy areas. 

In order to address the negative impact on employment and social cohesion, long-term 
reforms need to be sustained. These should be balanced with short-term measures aimed 
at preventing job losses and sustaining household incomes. A strong coordinated EU re-
sponse  is  necessary  and  valuable  indications  are  provided  by  the  European  Economic 
Recovery Plan – the EU’s strategy to drive its recovery from the current economic crisis.

Role of the European Social Fund
In addition, the European Social Fund should be used to its full potential in a ﬂ exible and 
timely way to alleviate the social impacts of the crisis, by supporting rapid labour market 
re-entry of the unemployed and focusing on the most vulnerable. Eﬀ orts are being made 
to simplify the implementation of the EU Structural Funds and to enhance coordination 
with social policies. 

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9

Joint Report on Social Protection and Social Inclusion 2009 – Summary
Social inclusion, pensions, healthcare and long-term care

FIGHTING POVERTY AND SOCIAL EXCLUSION

As shown in the SOCIAL SITUATION IN NUMBERS box, a noticeable proportion of the EU popu-
lation lives below the poverty threshold 1.  This number ranges from 10% in the Czech Repub-
lic and the Netherlands to 21% in Latvia. What is more, children and the elderly face an even 
higher poverty risk, at 19%. Vigilance is needed as new risk groups – e.g. young workers and 
labour market entrants – as well as new risks, may emerge.

SOCIAL SITUATION IN NUMBERS: 16% of Europeans, or 79 million people, were at risk 
of poverty in 2007

At-risk-of poverty rate in the EU (%, 2007)

Value of thresholds for a single household (right axis)
At-risk-of-poverty rate (left axis)

30

25

20

15

10

5

0

l

n
o
i
t
a
u
p
o
p

l

a
t
o
t

f
o
%

18000

15000

12000

9000

6000

3000

0

s
d
r
a
d
n
a
t
S
r
e
w
o
P
g
n
i
s
a
h
c
r
u
P
n

I

EU
27

EU
15

NMS
10

CZ

NL

SE

SK

AT

DK

HU

SI

FI

FR

BG

LU

MT

BE

DE

CY

PL

IE

PT

EE

LT

UK

EL

ES

IT

LV

RO

Source: EU-SILC (2007); income year 2006; except for UK (income year 2006) and for IE (moving income reference 

period 2005-06); RO: National Household Budget Survey 2006. BG data missing.

1 

This deﬁ ned as 60% of the national median equivalised disposable income, after social transfers.

10

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FIGHTING POVERTY AND SOCIAL EXCLUSION

Helping children out of poverty
The proportion of children at risk of poverty in the EU has not fallen since 2000. Tackling 
child poverty and breaking the transmission of disadvantage between generations has 
been a signiﬁ cant concern since the launch of the social inclusion process. The issue has 
increasingly been singled out as a key priority for Member States.

In 2006, the March European Council asked the EU-27 to take decisive steps to eradicate 
poverty among children. Many have taken this invitation to heart. Indeed, most countries 
which made the issue a priority are now planning to reinforce their strategies and follow 
a more multidimensional and integrated approach. 

A  boost  must  be  given  to  Member  States’  eﬀ  orts  to  implement  comprehensive 
strategies  against  poverty  and  social  exclusion  of  children,  including  accessible 
and aﬀ  ordable quality childcare.

22 countries have set targets relating to child poverty, 16 of them using EU-agreed indica-
tors. A few have also set intermediate targets for their speciﬁ c challenges (jobless house-
holds, families most at risk, intensity of poverty, childcare).

In addition, greater attention is generally given to children and families in the overall de-
sign of social inclusion policies, notably in the context of active inclusion policies. Many 
have  ‘mainstreamed’  child  poverty  in  this  way  in  areas  such  as  minimum  income  and 
wages, reconciliation of work and family life and family-friendly services. 

Promoting the social inclusion of Roma
Roma throughout Europe tend to face a range of disadvantages, making them extremely 
vulnerable to social exclusion and poverty. Accordingly, the Member States with a sizable 
Roma minority have given more coverage to this question and in general there is a better 
understanding of the challenges involved. 

In particular, the issues to be tackled include desegregation, access to employment, ad-
dressing educational disadvantage, and improved access to basic services such as hous-
ing and healthcare. However, there is a need for a comprehensive policy framework, to-
gether with more data and a more extensive and reliable knowledge base.

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11

Joint Report on Social Protection and Social Inclusion 2009 – Summary
Social inclusion, pensions, healthcare and long-term care

Active inclusion
Combating social exclusion means promoting the inclusion of vulnerable groups and 
tackling discrimination in all spheres of life, including on the job market. ‘Active inclu-
sion’ strategies have an important part to play, to make sure that social policies mobilise 
people who are capable of working while providing a decent standard of living to those 
who are and will remain outside the labour market. 

Active  inclusion,  simultaneously  promoting  inclusive  labour  markets,  ensuring  ad-
equate  income  and  access  to  quality  services,  is  a  priority  for  most  Member  States. 
However,  the  various  aspects  are  dealt  with  separately  in  most  cases,  whereas  most 
disadvantaged  people  suﬀ er  from  multiple  disadvantages  and  integrated  responses 
are essential. 

Several countries have taken steps to ensure that the purchasing power of minimum 
income beneﬁ ciaries is maintained, But it remains essential, for example, to design bet-
ter links between out-of-work beneﬁ ts and in-work support, in order to create the right 
incentives, while at the same time ensuring adequate income support and prevent in-
work poverty, and foster lasting labour market inclusion. 

Migrants 
Another group that tends to face social disadvantages are immigrants. Indeed, signiﬁ cant 
gaps persist between this group and the majority population in terms of poverty, income, 
health, employment, unemployment, education and early school-leaving.

As such, the Member States give priority to improving the inclusion of migrants. Increas-
ingly adopting a holistic approach, they are focusing more on getting both migrants and 
the host society involved in the process, and several are working to create synergies be-
tween inclusion policies and antidiscrimination measures. But still the issue needs to be 
given increased attention. 

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FIGHTING POVERTY AND SOCIAL EXCLUSION

Disabled people
With an estimated 50 million European citizens or more having some form of disability2,  
the inclusion of these citizens continues to be addressed. Economic inactivity and insuf-
ﬁ cient income support are commonly seen as underlying disabled people’s poverty, yet 
quantitative evidence is scarce. Member States are focusing on integrating disabled peo-
ple into the labour market, and eliminating barriers to education and lifelong learning, 
for example. 

Few, however, are giving priority to eliminating structural obstacles to full participation 
in society. There is further scope for giving more attention to disabled people in policy 
design across diﬀ erent areas (disability mainstreaming).

Tackling homelessness
Homelessness is one of the most severe forms of social exclusion and in the current eco-
nomic  climate,  access  to  aﬀ ordable  housing  and  preventing  evictions  are  all  the  more 
crucial in tackling poverty and social exclusion. 

Some  countries  implement  comprehensive,  multidimensional  strategies  to  address  its 
diﬀ erent manifestations speciﬁ cally, while others focus on measures integrated in wider 
policy frameworks, e.g. relating to housing, employment, and health. Supported hous-
ing – combining the objective of independent living with personalised social support – is 
receiving considerable attention. 

Several Member States have set targets to reduce homelessness or strengthen support 
structures. Lack of reliable data, however, continues to impair eﬀ orts to deﬁ ne and moni-
tor  eﬀ ective  policies.  Promoting  ﬁ nancial  inclusion  is  crucial  to  prevent  homelessness, 
particularly  in  the  current  circumstances;  appropriate  support  and  advice  must  be  en-
sured to people facing eviction or repossession.

2 

Labour Force Survey ad hoc module on disability 2002 combined with the Eurostat population estimate for 2008.

13

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Joint Report on Social Protection and Social Inclusion 2009 – Summary
Social inclusion, pensions, healthcare and long-term care

Addressing educational disadvantages
The importance of education is recognised by most countries, but only some have inte-
grated  the  issue  into  a  comprehensive  long-term  strategy  to  prevent  and  tackle  social 
exclusion. Pre-primary education is seen as fundamental, both as a key element in level-
ling  socio-economic  disadvantage,  and  as  a  means  to  facilitate  work/family  life  recon-
ciliation. Eﬀ orts also focus on ensuring high-quality standards in all schools, combating 
early school leaving, improving access to education for speciﬁ c groups and introducing 
measures to validate prior learning.

Addressing ﬁ nancial exclusion
Addressing ﬁ nancial exclusion is vital in any strategy against poverty, and the crisis brings 
the issue even more to the fore. On the one hand, people facing poverty and/or exclusion 
encounter speciﬁ c diﬃ  culties in accessing ﬁ nancial services, with negative consequences 
for their personal ﬁ nance or ability to ﬁ nd a job. Denial of access to ﬁ nancial services on 
the mainstream market may lead people to turn to more costly and risky alternative ﬁ nan-
cial products. On the other hand, for the general population, an improper marketing and 
unequal access to information of ﬁ nancial services may lead to over-indebtedness.

Some  Member  States  have  comprehensive  policies,  often  incorporating  debt  advice, 
whereas  one  is  tackling  over-indebtedness  as  a  priority.  Microcredit  –  the  use  of  small 
loans to those in poverty designed to spur entrepreneurship – is provided in some coun-
tries to people who cannot access the mainstream credit market. 

SOCIAL SITUATION IN NUMBERS: Despite overall progress on the labour markets, 
7% of the employed live below the poverty threshold (‘in-work poverty’)

14

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ADEQUATE AND SUSTAINABLE PENSIONS

ADEQUATE AND SUSTAINABLE PENSIONS

Population ageing can negatively aff ect pension systems. The dependency ratio (the ratio of 
population aged 65+ to those aged 15–64) is forecast to more than double from 25% to 53% 
between 2004 and 2050 3.  While old age is no longer synonymous with fi nancial hardship, the 
risk of pensioner poverty remains. 

Over the last decade Member States have reformed their pension systems to better pro-
vide adequate and sustainable pensions. Progress has been made in providing adequate 
pensions without jeopardising ﬁ nancial sustainability and work incentives. Yet the new 
economic outlook will make the necessary ﬁ ne-balancing even more challenging.

‘Adequacy’ and ‘sustainability’ deﬁ ned
The  goal  of  pension  schemes  is  to  ensure  a  decent  living  standard  for  the  retired,  in 
order to prevent poverty and social exclusion in old age. Such adequate pensions al-
low the elderly to share in the economic well-being of their country and to participate 
in public, social and cultural life. Adequate future pensions, however, require pension 
systems  to  be  ﬁ nanced  sustainably  in  the  face  of  rapidly  ageing  societies.  Adequacy 
and sustainability of pensions are thus inextricably linked.

Relative  income  of  the  elderly:  median  income  of  people  aged  65+  as  a  ratio  of 
 income of people aged 0–64, 2007

1,2

1,0

0,8

0,6

0,4

0,2

0,0

EU
27

CY

EE

LV

IE

LT

DK

UK

BE

FI

ES

SE

PTMT

CZ

SK

EL

NL

DE

IT

SI

RO

FR

AT

LU

HU

PL

Source: Eurostat.

3 

Eurostat.

15

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Joint Report on Social Protection and Social Inclusion 2009 – Summary
Social inclusion, pensions, healthcare and long-term care

More people in work and for longer
Due to rises in life expectancy, pension system reforms have focused on keeping older 
people active in the labour market. In fact more older people have jobs, with 11 countries 
now meeting the Lisbon target of 50% employment for those aged 55–64 years by 2010. 
Given the increase in life expectancy, even higher employment rates will be necessary in 
the medium term. 

To encourage older citizens to remain in the labour market, the eﬀ ective retirement age 
has  to  rise.  According  to  national  reports,  Member  States  are  starting  to  increase  the 
pensionable  age  in  statutory  pension  schemes,  early  exit  routes  are  being  closed  and 
incentives to early retirement removed. These are important signals for employers and 
employees to improve their practices of age management and postpone retirement. The 
current economic downturn will test the durability of these achievements. It will be cru-
cial to prevent a drop in the eﬀ ective retirement age and a use of early pathways out of 
the labour market to deal with rising unemployment.

SOCIAL SITUATION IN NUMBERS: The employment rate of older workers (aged 55-64) 
reached 45% in 2007 as against 37% in 2001.

Employment rate of older workers (55-64)

80

70

60

50

40

30

20

10

0

EU
27

2007

2000

Lisbon target

PLMT

LU

HU

SI

IT

BE

SK

FR

AT

RO

GR

BG

ES

CZ

NL

PT

DE

LT

IE

FI

CY

UK LV DK

EE

SE

Source: Eurostat.

16

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ADEQUATE AND SUSTAINABLE PENSIONS

Ensuring pension adequacy
The present economic outlook highlights the need to ensure that workers who are unem-
ployed for a time are covered by the pension scheme. Indeed, under reformed systems, 
career breaks can signiﬁ cantly reduce adequacy, as shown by the ﬁ gure. In particular, it 
is important to ensure full coverage and to monitor pension adequacy for women and 
low-wage earners.

SOCIAL SITUATION IN NUMBERS: Current pension systems have generally reduced 
poverty among the elderly, but single elderly women face a much higher risk than single 
elderly men (28% compared with 20%).

Impact of a 1-, 2- and 3-year career break for unemployment on future pensioner’s income

1

0

-1

-2

-3

-4

-5

-6

-7

1 year

2 years

3 years

PTMT

FR

CZ

ES

HU

BG

EL

DK

IE

NL

AT

LT

EE

SI

UK

BE

SE

LU

CY

DE

PL

LV

IT

FI

SK

RO

Source: ISG calculations on theoretical replacement rates carried out in the OECD APEX model or in national models.

Note: Measured by diﬀ erence in net theoretical replacement rates – pensioner’s income relative to the last re-

ceived wage, in percentage points.

Funded pension schemes
Although in most part they are not yet that important for those retiring today, funded 
schemes in general are becoming more signiﬁ cant every day. This is why the Joint Report 
2009 pays close attention to funded pension provision.

In particular, it emphasises the need for funded schemes to include provisions that pro-
tect against substantial volatility. One solution consists in lowering the investment risk as 
people approach retirement age – known as a ‘lifecycle approach towards investment’. 

17

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Joint Report on Social Protection and Social Inclusion 2009 – Summary
Social inclusion, pensions, healthcare and long-term care

With  such  a  strategy,  younger  members  might  choose  riskier  products  with  a  higher 
chance of earning more over one’s life; in contrast, members close to retirement could 
select products with a more cautious investment strategy before turning pension savings 
into retirement income.

The report also calls for appropriate solutions for the pay-out phase which is still to be 
determined in a number of countries with mandatory schemes. Annuities guarantee an 
income for life regardless of its eventual length and, as such, are the most secure means 
of providing an income in retirement.

Member  States  should  give  careful  consideration  to  the  proportion  of  overall  pension 
income expected to come from deﬁ ned contribution schemes and whether they would 
be  suﬃ  ciently  appropriate  for  all  groups  in  the  population.  For  instance,  in  voluntary 
schemes, there is evidence that coverage and contribution levels depend on the socio-
economic status of scheme members. 

If private schemes are to be an essential source of retirement income, coverage and con-
tribution levels need to be set accordingly. 

In addition, well-functioning supervisory bodies and eﬀ ective ﬁ nancial regulatory frame-
works are essential. With citizens’ pensions coming from multiple sources, it is vital that 
they have access to unbiased information and ﬁ nancial education so that they can make 
informed decisions. 

Impact of the crisis on funded pension income 
Long-term oriented strategies and the regulatory framework have limited the impact of 
the crisis on private pension income for most of those retiring today, but some will face 
outcomes below their expectations. 

Minimum income provisions
Member  States  are  changing  their  minimum  income  provisions  for  older  people  to  in-
crease beneﬁ ts and ease access. In as much as beneﬁ ts tend to be price-indexed, relative 
incomes were likely to have fallen behind in recent years of growth. Yet, the relative ero-
sion  is  in  most  part  substantially  smaller  than  could  be  expected.  Most  countries  have 
uprated minimum pensions and minimum provisions.

18

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UNIVERSALLY ACCESSIBLE HEALTHCARE AND LONG-TERM CARE

UNIVERSALLY ACCESSIBLE HEALTHCARE 
AND LONG-TERM CARE

Member  States  are  committed  to  accessible,  high-quality  and  sustainable  healthcare  and 
long-term care for citizens. Good health is an important goal, as it contributes to each indi-
vidual’s general well-being. In addition, it enables people to participate in the labour market, 
as well as in social and political activities, reduces sick leave and absenteeism, increases pro-
ductivity, and postpones retirement, allowing for longer working lives. 

SOCIAL SITUATION IN NUMBERS: Life expectancy is now 82 years for women and 76 
years for men. This follows a gain in longevity of 4 years for women and 5 years for men 
over the last 20 years.

Improving healthcare systems
Member States maintain that essential policies contributing to good health and longer 
working lives include eﬀ ective workplace health policies, health promotion, disease pre-
vention, curative care and rehabilitation. There is also a need to build greater coherence 
between economic, education, employment, environmental and social policy.

Member States are also continuing in their eﬀ orts to improve eﬃ  ciency and eﬀ ectiveness, 
with  several  exploring  the  possibilities  of  privatisation.  Whether  such  reforms  promote 
quality and eﬃ  ciency depends on the incentives and contracts with insurance funds. At na-
tional level, success depends on the institutional capacity to monitor, regulate, ensure risk 
equalisation and identify what the private and what the public can do better. Private and 
public provision also needs to be coordinated to create synergies and avoid duplication.

SOCIAL SITUATION IN NUMBERS: Total expenditure on health has increased through-
out the EU in the last 20 years. Today it ranges from 10% of GDP or more in some coun-
tries to 6% or less in others.

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Joint Report on Social Protection and Social Inclusion 2009 – Summary
Social inclusion, pensions, healthcare and long-term care

Access to healthcare for all
Despite the good healthcare systems in place in Member States, there continue to be strik-
ing inequalities in the health of European citizens from diﬀ erent socio-economic groups 
and regions. The available data suggest that people in all countries report that at least on 
one occasion in the previous 12 months they felt they needed medical care (examination 
or treatment) and did not receive it either because they had to wait, or it was too expen-
sive, or it was too far to obtain (unmet medical care). Those with less education, wealth or 
a worse job status tend to suﬀ er more from ill health. Such inequalities aggravate social 
exclusion and economic inequality and represent a loss of human potential.

Self-reported  unmet  need  for  medical  care  (access  reasons),  (by  income  quintile 
from the poorest ﬁ  fth of the population to the richest ﬁ  fth, %, 2006)

1st quintile

2nd quintile

3rd quintile

4th quintile

5th quintile

30

25

20

15

10

5

0

LV

PL

LT

EE

EL

PT

IT

CY

SE

SK

FI

HU

IE

UK

MT

FR

CZ

BE

ES

AT

NL

LU

DK

SI

Source: Eurostat based on EU-SILC 2006 data. 

Access reasons: waiting for care, paying for care and distance to care.

Member States are working to improve the situation through a variety of cross-sectoral 
policies addressing both how to promote better health and prevent disease. In addition, 
they are looking to involve a wide range of services such as education, housing and em-
ployment.  In  addition,  all  countries  see  enhancing  primary  care  as  the  way  forward  to 
improve access, ensure coordination of care and contribute to sustainability. 

20

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UNIVERSALLY ACCESSIBLE HEALTHCARE AND LONG-TERM CARE

However, as healthcare treatment – in particular hospital costs – consumes the largest 
share of expenditure, promotion and prevention receive a relatively small proportion of 
spending in relation to their goals. In addition, the shortages of general practitioners and 
nurses in many countries may make these goals more challenging to achieve. 

Quality of healthcare
Quality issues are rising up the agenda for Member States, with several undertaking ini-
tiatives that aim to provide citizens with good quality and safe preventive care and treat-
ment. For example, quality standards or clinical guidelines have been devised and imple-
mented using evidence-based medicine or health technology assessment. 

However, only a few countries have made patient safety – a crucial element of quality – a key 
priority, and set up appropriate structures and systems. Huge disparities can be seen, with 
some Member States advanced in the implementation of quality and safety strategies and 
in providing a patient-centred approach, and with others only at the beginning of the proc-
ess. These disparities may be due to the limited resources allocated to healthcare and the 
insuﬃ  cient awareness about long-term advantages that good quality of care may bring. 

Sustainability and coordination
As mentioned above, the issue of staﬀ  shortages in healthcare persists and the ageing of 
the population will likely make them more acute. This raises the question of sustainability 
of the system. Member States should therefore take measures to recruit, train and retain 
healthcare professionals at all levels. 

In addition, countries have made progress in creating an integrated approach for manag-
ing  chronic  diseases,  but  there  remains  much  to  do  to  improve  coordination  between 
levels  of  government,  types  of  medical  care,  health  and  social  care,  public  and  private 
provision, and the public and third sector. This is all the more so for long-term care.

Long-term care
Higher life expectancy and socio-economic changes are driving demand for long-term 
care. Thus, Member States are looking to identify a sustainable mix of ﬁ nancing, with the 
current  share  of  private  sources  of  ﬁ nance  being  relatively  high.  These  sources  can  be 
private health insurance coverage or private household payments.

Dependent  people  prefer  long-term  care  in  a  residential  or  community  setting  rather 
than institutional care, but in many countries the latter still accounts for more than half of 
public expenditure. Additionally, as in healthcare, there is a need to address the expected 
workforce shortages in the long-term care sector (formal care) as well as devising ways to 
support family or informal carers. 

21

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Joint Report on Social Protection and Social Inclusion 2009 – Summary
Social inclusion, pensions, healthcare and long-term care

CONCLUSIONS 

Key messages from Member States’ new NSRs outlining strategies to pro-
mote the EU’s common social objectives:

• 

• 

• 

The EU can build on the values of solidarity that underpin its social policies and 
on progress in structural reforms to cushion the impact of the economic crisis and 
help recovery. Further strengthening the positive mutual interaction with action 
for growth and jobs is vital, notably by allowing social protection systems to fully 
play their role as automatic stabilisers. In order to address the negative impact on 
employment and social cohesion, long-term reforms need to be sustained while 
balanced with short-term measures aimed at preventing job losses and sustaining 
household incomes. Recent structural reforms in the ﬁ eld of social security have 
delivered results, bringing more people into employment, strengthening the in-
centives to work and the resilience of labour markets, prolonging working lives 
and enhancing economic growth. A strong coordinated EU response is needed 
and valuable indications are provided by the European Economic Recovery Plan.

The  European  Social  Fund  should  be  used  to  its  full  potential  in  a  ﬂ exible  and 
timely way to alleviate the social impacts of the crisis, by supporting rapid labour 
market re-entry of the unemployed and focussing on the most vulnerable. Simpli-
ﬁ ed implementation of Structural Funds and improved coordination with social 
policies will help. The Commission will issue a regular bulletin to monitor social 
trends. Reports from Member States could facilitate exchange of information and 
policy experiences in the Social Protection Committee. 

Comprehensive Active Inclusion strategies that combine and balance measures 
aimed at inclusive labour markets, access to quality services and adequate mini-
mum income, need to be implemented. A boost must be given to Member States’ 
eﬀ orts to implement comprehensive strategies against poverty and social exclu-
sion of children, including accessible and aﬀ ordable quality childcare. Sustained 
work is required to tackle homelessness as an extremely serious form of exclu-
sion, to address the multiple disadvantages the Roma people are facing and their 
vulnerability to social exclusion and to promote the social inclusion of migrants. 
Vigilance  is  needed  as  new  risk  groups,  e.g.  young  workers  and  labour  market 
entrants, as well as new risks may emerge. 

• 

Long  term  adequacy  and  sustainability  of  pension  systems  depend  on  contin-
ued eﬀ orts to reach the Lisbon target of a 50% employment rate of older work-

22

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CONCLUSIONS

ers notwithstanding the downturn. It is important to ensure full coverage and to 
monitor pension adequacy notably for women and low wage earners. Long-term 
oriented strategies and the regulatory framework have limited the impact of the 
crisis on private pension income for most of those retiring today, but some might 
face outcomes below their expectations. Funded scheme designs will need to be 
reviewed to boost their ability to cope with risk in the investment and pay-out 
phases and to improve coverage so they can fully realise their strength in coping 
with ageing. 

• 

• 

• 

Member States strive to improve the value for money of healthcare and reduce 
health  inequalities  by  increased  attention  to  primary  care,  prevention,  health 
promotion,  better  coordination  and  rational  use  of  resources.  These  strategies 
need to be more vigorously pursued, in particular where healthcare systems are 
under-resourced. This also implies addressing potential staﬀ  shortages in health 
care by measures to recruit, train, retain and develop health care professionals at 
all levels. 

Member States are also striving to establish and strengthen systems for quality 
long-term care, to create a solid ﬁ nancing basis, to improve care coordination and 
to ensure suﬃ  cient human resources as well as support for informal carers. 

The current Social Open Method of Coordination (OMC) Cycle lasts until 2010, the 
target year for the Lisbon strategy. Strong commitment will be needed to achieve 
the agreed objectives on social protection and social inclusion and the 2010 Eu-
ropean Year for combating poverty and social exclusion will reaﬃ  rm it. While the 
decision on setting national quantiﬁ ed targets and their deﬁ nition remains a core 
responsibility of the Member States, the positive role of the Social OMC could be 
further strengthened by evidence-based national target-setting. Increased atten-
tion  should  be  given  to  the  quality  and  continuity  of  stakeholder  involvement 
and to the mainstreaming of social considerations inter alia via the evaluation of 
social impacts as a vital part of integrated impact assessments.

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23

Joint Report on Social Protection and Social Inclusion 2009 – Summary
Social inclusion, pensions, healthcare and long-term care

FIND OUT MORE

Joint Report on Social Protection and Social Inclusion 2009

National strategic reports

Social inclusion in the EU

Social protection in the EU

http://ec.europa.eu/employment_social/
spsi/strategy_reports_en.htm

h t t p : //e c . e u r o p a . e u /s o c i a l / m a i n .
jsp?catId=437&langId=en

h t t p : //e c . e u r o p a . e u /s o c i a l / m a i n .
jsp?catId=443&langId=en

European  Year  for  Combating  Poverty 
and Social Exclusion

h t t p : //e c . e u r o p a . e u /s o c i a l / m a i n .
jsp?langId=en&catId=637

European Social Fund

European Economic Recovery Plan

h t t p : //e c . e u r o p a . e u /s o c i a l / m a i n .
jsp?catId=325&langId=en

http://ec.europa.eu/economy_finance/
thematic_articles/article13502_en.htm

24

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European Commission

JOINT REPORT ON SOCIAL PROTECTION AND SOCIAL INCLUSION 2009 - SUMMARY
Social inclusion, pensions, healthcare and long-term care

Luxembourg: Publications Oﬃ  ce of the European Union

2009 — 24 p. — 14.8 x 21 cm

ISBN: 978-92-79-13136-3
doi: 10.2767/37533

This  leaflet  presents  a  summary  of  the  Joint  Report  on  Social  Protection 
and Social Inclusion 2009. Based on the National Strategy reports outlining 
national priorities for social protection and inclusion, the leaflet provides an 
overview  of  the  key  trends  on  the  European  Union  and  national  levels  in 
these areas. It is available in all EU official languages.

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to +352 2929-42758.

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You can obtain their contact details on the Internet (http://ec.europa.eu) or by sending a fax
to +352 2929-42758.

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