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About this book

The second edition of this textbook provides an accessible and structured look at social policy in a global comparative context. With detailed explanations of the historical, political and social context of policy developments across thirteen nations, the book offers an authoritative picture of social policy across the developed world. The book considers core areas of policy provision alongside contemporary international concerns, such as globalisation, demographic change and economic reform. Specifically, it examines policy in the following nations:
New Zealand
South Korea
South AfricaWritten and edited by leading social policy experts in each country, this is an invaluable contribution to the study of global social policy and an indispensable resource for students, researchers and policy-makers.

Table of Contents

Chapter 1. The International Context

The focus of this book is on the provision of welfare in a selected number of countries across the developed world. As the Introduction notes, our aim has been to provide a resource for the comparative study of social policy or welfare. However, this undertaking raises a number of important theoretical and definitional problems. What do we mean by ‘developed’ countries? What do we mean by social policy or welfare provision? More specifically, to what extent are these concepts uniformly understood in each country represented in the book? And, finally, what is the most useful framework within which to pursue comparisons between countries with differing social, political and economic histories?
Pete Alcock, Gary Craig

Chapter 2. An American Welfare State?

The organization of USA social welfare has always posed distinctive problems for comparative studies of social policy. The absence of a strong, centralized welfare state providing a wide range of more or less universal benefits and services has led commentators to question whether the term ‘welfare state’ could meaningfully be used in this context. In contrast to European welfare models, the USA has featured more complex relationships between federal and state governments, and a mixture of corporate, philanthropic and public sources of welfare provision, exemplified in the organization of US health care, developed without a national universal health insurance system. Peters (2005) argues that the dominance of private over public provision meant that the US should be viewed as a ‘corporate welfare system’ since corporations provide both welfare and a route to welfare for employees.
John Clarke, Frances Fox Piven

Chapter 3. Canada: One Step Forward, Two Steps Back?

In the early 1900s, Wilfrid Laurier, the Prime Minister of Canada stated that ‘the twentieth century belongs to Canada’. Few would have challenged him, for Canada had seemingly infinite natural resources in great demand in the USA, Europe and (in later years) the countries of the Pacific Rim; there was an endless supply of hard-working, white immigrants mainly from Central and Northern Europe, bringing with them traditions of self-help and social solidarity; railways had been laid to link the vast reaches of the country from one side of the continent to the other; and Canada was at peace with its only land-based neighbour, a relationship certain to grow closer with the passing years.
Ernie S. Lightman, Graham Riches

Chapter 4. Australia: From Wage-Earners to Neo-Liberal Welfare State

In 1901, in a climate of optimism and social experimentation, six British colonies, all but one a former penal settlement, federated to become states of the Commonwealth of Australia. Much later the states were joined by two territories, which play a similar role, but lack the constitutional protection of their status, so are more subject to Commonwealth veto. This chapter is focused primarily on the development of social policy since the birth of Australia as a nation in 1901. However, its prehistory is still evident not only in the administrative boundaries between states but also in the, now somewhat modified, constitutional divisions of powers between the two tiers of government. In general the Commonwealth has increasingly gained in powers since Federation, but the history and distinctive patterns of state, and later territory, politics have ensured there remains a relative independence between these first and second tiers of government. This is well illustrated by the fact that, from 2002, Labour held political power in all states and territories while the conservative coalition government remained in power federally until 2007.
Lois Bryson, Fiona Verity

Chapter 5. New Zealand: From Early Innovation to Humanizing the Market

Internationally Aotearoa/New Zealand is often seen as a place of ‘experimentation’ in social policy, beginning with the introduction of universal suffrage and old-age pensions in the late nineteenth century. Social innovation continued in the mid-twentieth century when economic prosperity and an egalitarian outlook contributed to development of a comprehensive welfare state. More recently, the country took welfare reforms based on free-market principles and economic rationalism further than most developed nations. Well within the space of a lifetime there was a shift to a minimalist approach to welfare, with extensive targeting and ‘user-pays’ policies. However, since the late 1990s coalition governments have provided a brake on further marketization. Given this background, New Zealand provides interesting examples of social policy change and the influences behind it.
Judith Davey, Sandra Grey

Chapter 6. The United Kingdom: Constructing a Third Way?

Welfare policy in Britain in the twenty-first century can be traced back to the early years of the nineteenth century, and indeed beyond that to the onset of industrialization and capitalist economic relations in the seventeenth century. However, we cannot explore such a distant history here (see Digby, 1989; Fraser, 2003; Harris, 2004); and it is sufficient to gain an understanding of current, and prospective, welfare policies to see the ways in which these emerged from the key political, economic and ideological developments within the twentieth century. This historical context can be divided loosely into six broad stages of development:
  • Early Reform — during the first two decades of the last century a new role for the state in providing welfare services for a wider range of citizens was introduced in a number of key areas. These included: social security through state insurance for pensions, unemployment and sickness; primary education (up to 12 years of age) in local state schools; the establishment of a Ministry of Health; and the beginning of building of public sector houses to rent.
  • Responding to Recession — between the two world wars Britain, in common with most other Western industrial nations, experienced severe economic recession. Although there was piecemeal growth in welfare services during this period the pressure of social need meant that in many areas limited public provision could not meet expected public demand, leading to some cuts (for instance, in social security benefits in 1930) and much suffering.
  • The Postwar Welfare State — in the late 1940s, following the end of the Second World War, the newly elected Labour government engaged in the most significant and rapid period of welfare reform in the century. During this period, as we shall discuss below, public services providing near universal coverage for most welfare needs were introduced with widespread popular and political support. The period is often regarded as leading to the establishment of the British ‘welfare state’.
  • Incremental Growth — throughout the 1950s and 1960s, a political consensus over the desirability of state welfare was allied to a long period of economic boom, resulting in gradual growth in welfare provision and welfare expenditure within the services established by the postwar reforms. Between 1951 and 1976 welfare spending on education, health and social security grew as a proportion of gross domestic product (GDP) from 11 to 22 per cent.
  • Containment and Retrenchment — In the mid-1970s the long postwar boom came to an end and economic and political priorities altered sharply in Britain. In the 1980s, Conservative governments openly hostile to the collective values of state welfare provision were in power, the proportionate rise in welfare spending was halted and significant reforms were introduced to privatize and marketize welfare provision.
  • The New Welfare Mix — at the beginning of the twenty-first century, state provision of welfare remains significant and widespread, and public expenditure on this is again rising in both absolute and relative terms. At the same time, however, other private, voluntary and informal forms of welfare provision are now openly encouraged and promoted as alternative forms of provision within a new ‘welfare mix’. This new welfare mix is part of a broader attempt by the Labour governments in power since 1997 to ‘modernize’ welfare provision, which has sometimes been championed as a ‘third way’ between state monopoly welfare and private market provision.
The changes outlined here are discussed in more detail in, in particular Timmins (2001), Lowe (2005) and Glennerster (2007). Despite the shifts in both policy and ideology, however, there are significant continuities within British welfare policy, especially when compared with policy developments in other countries throughout the developed world. Britain provides an interesting case of the Anglo-Saxon welfare model, sometimes also referred to as the ‘Beveridgean Welfare State’, which contrasts starkly with the more residual approaches found in the USA, Canada and Australia, and the ‘social state’ model adopted in Germany and other continental European countries.
From this perspective British welfare provision is associated most closely with the major national reforms of the late 1940s and the establishment of universal, redistributive, national welfare services. The clearest exposition of the rationale behind these reforms was provided by the 1942 Beveridge Report. Here, Beveridge outlined a plan for a peculiarly British social insurance scheme for social security, based on all-inclusive flat-rate benefits; but he also talked about the need for comprehensive health and education services and for state support for full employment (for men). His ideas were largely taken up by the postwar Labour government. Despite the reforms which have been made since then, the basic structure of much of the Beveridge vision remains in place.
Pete Alcock

Chapter 7. Sweden: Between Model and Reality

No other country has so often served as a role model in international social policy comparisons as Sweden. In the second half of the twentieth century, in particular, it was singled out as a welfare state with distinctive characteristics. In the mid-twentieth century Sweden was presented as an attempt to find a ‘middle way’ between capitalism and socialism (Childs, 1947), and in later years it was considered a prototype of the institutional welfare model (Mishra, 1981). In modern literature on the emergence and characteristics of Western welfare states, Sweden has been categorized as the most developed example of a universal welfare state (Flora, 1986; Esping-Andersen, 1990, 1996; Vogel, 2004). However, underlying assumptions for yardsticks of this kind have often been a blurred mix of normative ideas and empirical data. Some scepticism about such ‘Swedocentrism’ (Shalev, 1983) — a tendency to use Sweden without reflection as a role model for other countries — is therefore in order. Undoubtedly, there is some justification for analyzing Sweden as a distinct country in the broad field of social policy, but it is a mistake uncritically to confuse the popular role model of Sweden with the variability seen in real life.
Tapio Salonen

Chapter 8. Germany: A Centrist Welfare State at the Crossroads

Since the late nineteenth century, Germany has undergone more drastic changes, both of political regime and territory, than most countries. During four decades after the Second World War there were two diametrically opposed regimes coexisting within Germany. Imperial Germany, the Reich (1871–1918), was followed by the Weimar Republic, the first German democracy (1919–33), and by National Socialism, the Third Reich (1933–45). After a period of occupation, a democratic and capitalist West Germany, the Federal Republic of Germany (FRG), and a totalitarian and communist East Germany, the German Democratic Republic (GDR), were founded in 1949, only reuniting in 1990. These historical periods have left their marks on social policy as on other areas of policy. Yet, despite the changes, there were considerable institutional continuities across political regimes. Unification in 1990 was a takeover of the GDR by the FRG. On one day, all FRG legal and social institutions were imposed on the eastern part, including basic institutional social policy arrangements.
Lutz Leisering

Chapter 9. Italy: Still a Pension State?

Socially and economically, Italy is two countries in one. While northern regions display a dynamic economy, well-integrated into global markets, southern regions still search for a route to economic development, social and political modernization. One critical consequence of this divergence is that southern unemployment rates are nearly 19 per cent whereas north-eastern industrial firms experience labour shortages.
Valeria Fargion

Chapter 10. Russia: State Socialism to Marketized Welfare

The Soviet Union (USSR) was a large and diverse empire, founded in 1917, which not only created a distinct pattern of social policy among the 15 republics that it contained, but imposed this pattern in large part on many other Central European countries. Within this vast area, there was great cultural, linguistic, industrial and natural variation. Even within the USSR, Russians comprised little more than 50 per cent of the population. The ‘Eastern Bloc’ then separated into 27 separate states, and the USSR itself disappeared in 1991. In this chapter we concentrate mainly on Russia.
Nadia Davidova, Nick Manning

Chapter 11. Japan: Constructing the ‘Welfare Society’

Japan is one of the Far East countries sometimes referred to as the Pacific Rim ‘Asian Tigers’. The country consists of four principal, relatively small, islands on which 123 million people live; Japan is thus densely populated by most Western standards, a feature also of other Asian Tigers such as South Korea, Singapore and Taiwan. Why they are so densely populated is not clear — although some claim the production of rice as a staple food is a possible cause, as a given amount of rice can feed more people than other grains, rice production being, however, relatively labour-intensive. Whatever the cause, the resulting population density has been a key feature structuring the development of economic and social policy within these countries.
In recent years the issue of population has been attracting more and more attention in Japanese policy planning. This attention is not so much related to the number of the people, however, but rather to the structure of society, that is, the ‘problem’ of ageing. Japan has seen a much more rapid growth in the proportion of its older people than many other comparative countries, as Table 11.1 demonstrates.
Furthermore Japan will be ‘super-aged’ by the year 2020, when this proportion (of 65 +) is projected to be 27 per cent. This ageing is also combined with a declining fertility rate. The current fertility rate (2005) in Japan is 1.26, far below the replacement level of 2.1. It is obvious that these two trends will have a huge impact on Japanese social policy.
Takafumi Ken Uzuhashi

Chapter 12. Korea: Rescaling the Developmental Welfare State?

The welfare state in Korea (also known as South Korea or the Republic of Korea) has evolved over the past 40 years from a bare structure, with a minimal number of programmes, into a fairly comprehensive system. During this time, Korea has acquired distinctive social policy characteristics. One of the important rationales for social policy in the East Asian region was ‘welfare developmentalism’, which saw social policy as an instrument for economic development. Based on such a policy rationale, Korea’s social policy can be summarized as the developmental welfare state (Kwon, 2005). In fact, social policy did indeed prove to be one of the most effective policy instruments during the period of rapid economic growth in Korea (Goodman and White, 1998). There were also downsides to welfare developmentalism. The welfare state protected first the selected group of people who were working at the strategic industries for economic development, leaving vulnerable sections of society outside the system. This resulted in the situation that the welfare state, particularly the pension and health-care systems, reinforced social inequality. This social policy paradigm was allowed to be implemented in practice by the authoritarian politics that spanned from the 1960s to the early 1990s (Kwon, 1999).
Second, the equally important policy dynamic shaping the Korean welfare state was the democratization that took place from the mid-1980s. The dynamic between democratization and the development of the welfare state in Korea has been much more complex than the way in which Marshall once described it, as the development of political and social rights (Marshall, 1964). At times, social policy programmes were introduced or extended to fend off democratization pressures on authoritarian governments, while other programmes were the spoils of democratic political struggles. Korean politics has now successfully shifted to a democratic form; the fragmented social policy programmes such as National Health Insurance were reformed and risk pooling was extended in favour of people who were more risk-prone (Lee, 1997). This development of the welfare state can be described as a move from a ‘selective’ to an ‘inclusive’ welfare state (Kwon, 2005). The culmination of this transition was welfare reform by the Kim Dae-jung government in the wake of the East Asian economic crisis of 1997–8.
The third dimension often identified as a core feature of the Korean welfare state is the notion of Confucian familism, involving ‘a strong reliance on the family as the site of social welfare and service delivery’ (Goodman and Peng, 1996, p. 193). Social arrangements were based on the assumption of the family as the main provider of care. The traditional image of the family was of a unit composed of three generations, where household work, including homemaking and care-giving, was undertaken by ‘housewives’. This ideal-typical family has become a marginal form of family in reality, but the underlying assumption of care responsibility remains based on such a family form. Rapid ageing, and changes in family structure also put strain on the structure of the welfare state in Korea, undermining the traditional rationale of developmentalism and familism. A clear sign of this is that Korea has the lowest fertility rate at 1.13, according to the National Statistics Office in 2007. It can be interpreted as women’s response to the Korean welfare regime.
We will first discuss welfare reform after the East Asia economic crisis in 1997–8, a move towards further inclusion incorporating the concept of social rights while maintaining its developmental credentials. Second, we discuss policy issues that emerged after the reform, arguing that it is necessary to ‘rescale’ the welfare state in order to make it socially inclusive while maintaining its sustainability. Before proceeding, it will be useful to set out the historical development of the Korean welfare state in five stages, explaining the overall structure of social policy programmes.
  • The formation of the developmental welfare state — The first social welfare programme was Industrial Accident Insurance in 1963, along with a pilot programme for health insurance effected by the military government which took power after a coup d’¨¦tat in 1961 (Kwon, 1999). It was considered necessary as Korea embarked on an ambitious economic development plan. At the beginning, Industrial Accident Insurance covered people in workplaces of 500 employees or more. In 1962, the government made the existing Civil Service Pension Programme more generous, to mobilize the bureaucracy for economic development.
  • The expansion of the developmental welfare state — In 1973, the National Pension Programme (NPP) was first considered as an effective measure for increasing domestic savings: capital could be used for industrialization. It was, however, postponed due to the sudden oil price rise and subsequent inflation. In 1977, National Health Insurance (NHI) was introduced for workers in enterprises that employed more than 500: a separate health fund for the civil servants was introduced in 1979.
  • Democratization and the welfare state — The sudden death of President Park followed by another military man at the helm of power led to a decade-long democratization movement. Political efforts to make the fragmented NHI a universal programme were frustrated by the authoritarian government, but social grievances emerged at the centre of political debates. In the wake of the first democratic election for the presidency in 1987, the government extended NHI to those previously excluded, making it a universal programme. In 1988 the government reintroduced the NPP in the same format as the 1972 proposal. In 1993, the Employment Insurance Programme (EIP) was introduced as Korea prepared to join the OECD.
  • Reform of the developmental welfare state — In the wake of the East Asian economic crisis, the Kim Dae-jung government strengthened and extended the welfare state in terms of benefits and coverage. The EIP was extended to all workplaces in 1998, although not strictly enforced. The Minimum Living Standard Guarantee was introduced based on the idea of social rights in 2000, replacing the stringently means-tested public assistance programme. In the same year all separated health funds under NHI were integrated, paving the way for a financially and administratively integrated programme. Civil society groups played active roles in strengthening those programmes.
  • Rescaling the developmental welfare state — Concerned about financial sustainability, the government began to initiate reforms of the NPP, the Civil Service Pension Programme and NHI, while strengthening social service programmes. In 2007, the National Assembly passed the bill that would reduce the level of pensions, while it explored various methods to reduce the cost of NHI. A new programme, Long-Term Care Insurance for the Elderly, was introduced in 2008. Underlying such moves are rapid demographic ageing rates and a very low fertility rate at 1.13.
Hulk-Ju Kwon

Chapter 13. China: The Art of State and Social Policy Remodelling

For the past 50 years, the Chinese social policy discourse has barely been the subject of discussion in international social policy circles. This is in large part due to the dissimilarity of its rationale and approach to that of its counterparts among Western welfare states. In some cases, scholars have identified the Chinese system as a socialist welfare regime (George and Manning, 1980; Deacon, 1983; Dixon and Macarov, 1992). Because China stayed out of the world of welfare capitalism, the possibility of comparing it with other welfare regimes was limited. However, things began to change as China embraced a market approach, thereby establishing a new basis for comparison. Academic interest in Chinese social policy has grown rapidly in recent years due to its prominence as one of the East Asian welfare regimes, a member of the socialist welfare bloc, the largest country in the developing world and the world’s third-largest economy. Thus the experience of Chinese social policy development can provide meaningful insights to be used in other social policy contexts.
Ka Lin

Chapter 14. South Africa: Transition Under Pressure

South Africa’s political transition from apartheid to democracy in 1994 was accompanied by significant changes in economic and social policies. Social policy was so closely related to the political economy of apartheid that it cannot easily be classified according to any of the conventional welfare regimes. Nevertheless, it has much of interest in the comparative study of welfare systems. The urgency of abandoning the racially discriminatory policies of the former government meant that key elements and stages of the policy process have been telescoped into a short period. During the 1990s, policy formulation, then its translation into legislation, budgetary reallocations, the reorientation of staff, the development of administrative capacity and the adjustment of information and communication systems, all happened rapidly. Tensions always inherent in the policy process were forced to the surface, and have been more visible than they would be in societies where the pace of change is slower. It is possible to see how even in a country so eager to move away from its past, policy changes are constrained by history. As commonly experienced elsewhere, a gap exists between policy acceptance and implementation.
Francie Lund
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