Lead Economist for Europe and Central Asia, World Bank,
Former Secretary General of the European Trade Union Confederation,
Team leader, Social Affairs team, European Political Strategy Centre,
livestream @ 13:00 CET
Presentation of Maurizio Bussolo
Globalization and rapid technological change have created opportunities but also intensified risks and insecurity. This event featured the presentation of the recently published World Bank report “Towards a New Social Contract: Taking on Distributional Tensions in Europe and Central Asia”, which shows that societies need a welfare state now more than ever. Insecurity and risks are not shared equally: distributional tensions between groups (generations, workers, regions) are rising, and inequality of opportunity remains persistently high.
The report shows that the current tax and transfer and markets regulation systems – the existing social contract – are not very effective in coping with these distributional tensions. Dissatisfaction with the status quo and the trust deficit towards the current social and political arrangements have resulted in voting polarization and rise of populism.
How would a renewed social contract look like?
The report highlights three policy principles which, considered jointly, should inform a renewed social contract: 1) encourage universal provision of social assistance, social insurance, and basic quality services; 2) promote equal protection of all workers, regardless of their type of employment; and 3) improve the fairness of the tax system by supporting progressivity of a broad tax base that complements labor income taxation with the taxation of capital.