Social Policy Developments in Greece

Elias Mossialos, Maria Petmesidou, Maria Petmesidou

• Publisher: Routledge
• Year: 2017
• ISBN:
  9781351899352
• Edition: 1
• Topic: Politica e relazioni internazionali
• Subtopic: Politica sociale

In recent years there has been much debate surrounding the future of the welfare state in Europe, the complex factors influencing reform, and the extent to which responses to pressures on welfare could lead to irreversible systemic changes in social policy. By providing an in-depth analysis of social policy developments in Greece, this work furthers understanding of welfare reform trajectories in Europe. The authors thoroughly examine aspects of structural change, challenges and responses in major policy areas of employment, social security, family and gender, health and social care, and migration. Research issues central to the debate on 'recasting European welfare states', such as structural adjustments with regard to the production, organization and delivery of welfare, significant changes in the financial side of social protection, the role of political parties, the social partners and other major social actors in influencing (or resisting) policy reform, are at the forefront of the contributions to this volume. The scope and intensity of pressures on the Greek welfare state emanating from the supranational level and the challenges linked to European integration and economic and monetary union are also of crucial importance in the analyses undertaken.

Chapter 1
Introduction: Addressing Social Protection and Policy in Greece

Maria Petmesidou and Elias Mossialos

For a long time Greece (and the other south European countries, with the exception of Italy) remained outside the scope of major comparative research studies on welfare state arrangements and social policy systems in Europe. This is mainly due to the rudimentary development of universalist welfare structures in the country until the late 1970s – early 1980s, and the distinctive features of its socioeconomic and political structures for much of the postwar period: for example, the agricultural basis of a large part of the labour force and extensive self-employment in rural and urban areas; an enormous hidden economy; political instability;¹ and the predominance of paternalistic/clientelistic forms of social and political integration, closely linked with cultural values upholding familism and nepotism.² Moreover, over the last two decades welfare state reform in Europe, under the influence of a multitude of internal and external change factors, has taken centre-stage in comparative studies. Although south European countries progressively have been encompassed in this debate, there are still large gaps in the literature regarding the specific historical pathways of social protection systems and the pressures for change in these countries.

The aim of this volume is to address this major gap, particularly for Greece, by offering a thorough examination of the Greek welfare model: its historical origins and specific pathway in the postwar period, the key sociopolitical forces, institutional configurations and policy processes, as well as developments up to the early 2000s, which provide pressing challenges and reform prospects in particular policy areas – social security, employment, family and gender, health, social care and immigration.³ A systematic comparative analysis of the Greek case vis-à-vis other European countries (or welfare-state regimes)⁴ lies outside the scope of this enterprise. The book seeks to shed light upon the country’s specific historical pathway in social protection, so as to provide the necessary descriptive and analytical material that would facilitate Greece’s inclusion in comparative investigations in the future. However, at several points of the analyses undertaken by the authors, it was considered necessary to raise questions of a comparative nature and highlight Greece’s similarities and differences with respect to welfare structures in the other southern European countries and/or the more developed west European systems of social protection.⁵ The overall aim is to elucidate, document and explain Greece’s distinctive features in terms of social protection and policy experience, the institutional setting and underlying sociopolitical dynamics of the system, as well as the forces of inertia and change affecting the contours, orientation and substance of reform over the last two decades. The examination of the effects of European integration⁶ on planning processes and policy content is also crucially important and these issues are addressed, more or less directly, in a number of contributions.

The European Debate on Welfare Reform and the Case of Greece

Reform Pressures in Europe

In the last two decades successive rounds of welfare state reform constituted hotly debated issues among academics, policy experts, administrators and politicians in Europe. A complex set of internal and external change factors destabilising and challenging welfare arrangements that developed during the ‘Golden Age’ of welfare capitalism (1960–1975) in west European countries, and their accompanying forms of socioeconomic regulation, attracted most attention. To highlight very briefly, the west European social protection systems formed in that period aimed at ‘a general enrichment of the concrete substance of civilised life, a general reduction of the risk and insecurity, an equalisation between the more and the less fortunate at all levels’ (Marshall, 1992, p. 33). The idea was to build an inclusive society, even though inclusion was based on a gendered view of society centring upon the male breadwinner (and the assumption of full employment of the male labour force). Social considerations about the role and characteristics of a number of social groups (like women, disabled persons, the elderly, students, etc.) justified their exemption from paid work,⁷ while at the same time collective values about society’s obligation to social welfare defined citizenship rights and redistribution.

In the last few decades, a confluence of significant socioeconomic and value changes have challenged the above welfare arrangements. Among the major endogenous social transformations creating the need for reform, in a more or less convergent way across Europe, are the ageing of the population and its effect on the sustainability of pension schemes, coupled with the cost explosion of health and welfare programmes; changing household and family patterns, in parallel with the increasing participation of women in the formal labour market, which affect the demand for social service provision; risks related to structurally high levels of unemployment and the emergence of non-standard work-careers; intensifying migration flows; and new problem constellations concerning poverty and social exclusion. In addition, the erosion of postwar social consensus on redistribution and universalist citizenship values is reflected in growing public criticism from both right- and left-leaning perspectives stressing welfare dependency, the paternalistic and gendered character of the welfare state and the necessity for a more active participation of welfare subjects in the definition of welfare needs. At the same time, the deepening socioeconomic integration of Europe and globalisation of markets have had significant effects on governance structures and policy processes, particularly by enhancing the role of the ‘competitiveness imperative’ with regard to European welfare futures (Taylor-Gooby, 2001, pp. 16–17).

Reform trends and new policy arrangements emerging as a response to these pressures have variously been presented, in the expanding literature, as processes of ‘recasting’, ‘adapting’/’evolving’ or ‘recalibrating’ welfare states (Esping-Andersen, 1996; Kuhnle, 2000; Ferrera and Rhodes, 2000). Some recent studies even argue that a more profound transformation is on the way (Walters, 1997; Taylor-Gooby, 2001; Streeck, 2001), as the perspective of an ‘active society’ (or ‘workfare society’) tends to replace the organisational principles and value choices of the old welfare order. This perspective largely redefines the links between social protection and wider participation in paid employment. It supports the maximisation of labour force participation and its pluralistic expansion through the inclusion of a progressively larger part of social groups that under postwar welfare arrangements were not actively encouraged to enter the labour market (like women as housewives, lone mothers, various groups of disabled and vulnerable people) (Walters, 1997, pp. 222–24). Equally, unemployment policy is redesigned with the aim of encouraging individual activation initiatives for solving unemployment and poverty problems. This reflects a significant value change in European societies and a concomitant shift of public policy responsibility away from the aim of providing social security in order to protect individuals from the market to promoting equality. Instead, providing the conditions that could enhance ‘the resource endowments of market participants, especially their ‘human capital’ and ‘employability’’ (Streeck, 2001, p. 32) becomes the primary concern of public policy. This constitutes an opposite trend to the decommodification of labour that was supported, although to a varying degree, by west European welfare-state regimes during the ‘Golden Age’ of welfare capitalism.⁸

Of crucial importance in this debate are also the effects of European integration on territorial and membership boundaries of domestic welfare systems, transforming European (welfare) states from ‘sovereign to semi-sovereign entities’ (Leibfried and Pierson, 1995). Concomitant processes of boundary removal and reformulation at both the supra- and infra-national levels are on the way: i.e. in the context of economic and monetary union and the emergence of a supra-national political and institutional setting, in parallel with the appearance of new sub-national cleavages and social-sharing institutions at the regional/local (or trans-regional level). A strong potential for institutional transformation, deconstruction of traditional (national-based) social solidarities and the appearance of new social-sharing structures (for example, at the regional and/or trans-regional/cross-country levels) characterises these processes across Europe and various studies have offered significant insights for analysing such phenomena (among others see Ferrera, 2003 and Graziano, 2003).

Delving into the multi-faceted effects of all change factors through a detailed comparative analysis of Greece vis-a-vis the other European Union (EU) countries is beyond the scope of this book, as is a detailed and in-depth examination of the impact that all the above-mentioned social transformations may have on the Greek polity and society. Central to the analyses undertaken in this volume is the fact that in Greece, which lagged behind in social welfare development for much of the post-war period, reform not only has to face pressures by the new problem constellations shared, to one degree or another, by European societies (i.e. new risks and welfare demands, demographic changes and economic constraints destabilising social welfare). It equally needs to address the issue of the rationalisation of the social protection system by tackling well-entrenched legacies reproducing fragmentation, polarisation and particularism, while at the same time expand coverage to a number of deprived social groups for which hardly any social safety net exists (those employed in the underground economy, young unqualified people without work experience, the long-term unemployed and particularly unemployed women, the elderly with no rights to social insurance, and other vulnerable groups).

Can We Identify a Greek Welfare Model?

Since the early 1990s, some comparative investigations examined Greece, together with the other three southern European EU-member countries, in an attempt to locate this group of countries within the main classificatory schemes offered by the comparative social policy literature. In these studies southern European countries are variously considered to constitute: (a) a residual welfare state reflecting a liberal ideology and the central role of the family (and of the Catholic Church, in the so-called Latin Rim countries) in welfare delivery (Leibfried, 1992); (b) a less-developed version of the continental-corporatist welfare state (Katrougalos, 1996); and (c) a distinct social protection system combining a fragmented social insurance model with universalism in health care and the delegation of welfare provision to the family (Ferrera, 1996). A drawback of these approaches to the southern welfare model is that they primarily focus upon the characteristics of the Latin Rim (or Catholic) countries (and indeed in the case of Leibfried’s classification, the southern model is identified as the ‘Latin Rim model’), while sociocultural characteristics of the Balkan countries (namely the role of the Orthodox Church and the prevalence of statist and paternalistic forms of social organisation) have been neglected. As argued elsewhere, these characteristics are linked with eastern statist traditions extending far back in the history of Ottoman and Russian autocracy that influenced the area (Petmesidou and Tsoulouvis, 1994).

Briefly, some major similarities and differences in social, economic and political structures across southern Europe can be traced along historical trajectories of development in the area. In this respect we can clearly distinguish between: a northern, north-western zone (including the Basque region and Catalonia in Spain, Lombardia and Piemonte in Italy), in which the pacing and degree of industrialisation were higher; and a southern, south-eastern zone (including much of Portugal, southern Spain, southern Italy and Greece as a whole), in which agrarian structures were extensively reproduced until the late 1970s. At that time a rapid shift to post-fordist social and economic structures set in, well before industrialisation had deepened and fordist production structures, with their accompanying patterns of collective solidarity and universalistic social citizenship, had been fully developed. The more rapid the change from agrarian structures to a services-oriented economy across the regions of southern Europe, the weaker and the collective forms of solidarity and universalism in welfare provision.

In the south-east (that is, in Greece and the other Balkan countries, including Turkey) a tradition of contractual relations, collective solidarity and an active civil society have always been weakest. Furthermore, statism and particularisticclientelistic forms of social organisation have traditionally been more pronounced, with Greece and Turkey constituting extreme examples of statist-paternalistic forms of social organisation. These historical features are of central importance for examining social stratification (and class structure), socioeconomic inequalities, poverty and social exclusion in Greece (see Petmesidou, 1987). They strongly influenced an institutional configuration that we could define as implicit social policy, in the sense that up to now well-defined rules of redistribution on the basis of more or less universalist welfare-state structures have only developed marginally. Instead implicit processes of revenue creation and distribution on the basis of differential access to the state and the poles of political power by individuals and households (rather than on an explicit definition of need and/or social citizenship rights) have been prevalent for a long time.

It is beyond the scope of this overview chapter to delve deeply into the socio-historical origins of these characteristics. Suffice it to stress, however, that from a political economy perspective the kind of state, society and economy relationships historically consolidated on the basis of a wide legitimation of the use of extra-economic (i.e. political) means to appropriate and distribute resources are crucial for understanding social protection and its path dependent trajectory in Greece. For a long period following World War II, phenomena of statism, paternalism and clientelist practices formed the basis of the major socioeconomic divides in society, between those social groups that could establish legitimate political credentials of access to the state (and its revenue yielding mechanisms), and those deprived of such access. Social class interests and conflicts, and the character of social exclusion/inclusion were closely linked with this institutional arrangement of socioeconomic and political integration.⁹ Similarly, it is with regard to this particular articulation of state-economy that the central role of the family/household as a decision-making unit for the work options of its members, the redistribution of resources and the provision of welfare and support should be examined; particularly in connexion with the way state intervention makes it possible for households to derive revenue by extra-economic means and distribute it to its members in the form of welfare provision.

A striking illustration of the distributional patterns characterising this particular articulation of state-economy can be provided by the tax system in Greece. The poor performance of the tax system in terms of the criteria of progressivity and horizontal equity has been documented by various studies (Balfoussias, 2000; OECD, 2001; Bronchi, 2001; also, in Chapter 5 of this volume, Papatheodorou investigates the pattern of inequalities produced by the system). Inadequacies are held to be due to the complexity of tax laws following continuous and piecemeal amendments that render the system chaotic; the numerous loopholes for tax allowances, exemptions and preferential incentives; the absence of a strong and uniform tax enforcement mechanism which keeps tax compliance low; as well as the heavy weight of indirect taxes in the system. With regard to the latter characteristic, we should stress here ‘the extra burden of so-called “third-party” taxes’, a large part of which is used to finance, in a preferential way, specific social insurance funds (for example, the pension fund of lawyers, engineers, media workers, customs officers and of some other socioprofessional groups)’ (OECD, 2001, p. 93). Other striking aspects of tax inequalities concern the lower tax burden (including social security contributions) on the earnings of the self-employed in comparison to those of employees (as the former tend to place themselves in low income classes or evade taxation), the large size of an untaxed underground economy, the lack of a land registry that keeps property taxation at low levels,¹⁰ and a low contribution to taxation by capital incomes (i.e. bank interest and equities).

Value choices for social welfare have been strongly influenced by conditions such as fragmentation of social conflicts in which access to the state was, simultaneously, different groups’ primary means and ultimate target; the transformation of class struggles into party-political/clientelistic power feuds and the dominating role of political parties over civil society; the extensive reproduction of a contradictory condition of state dependency on the one hand (as a considerable part of the population derives revenue from direct or indirect access to the state apparatus), but also incessant confrontation with state institutions...