The primary policy context for this report is the Communication ‘Modernising Social Protection for More and Better Jobs – a comprehensive approach to making work pay’ (COM, 842 final). Four of the seven recommendations made in this Communication inform the focus of this report, namely: the removal of financial disincentives, ‘traps’ and barriers in social protection (tax and benefit) systems, the relevance of addressing certain non-financial incentives (particularly care facilities and job quality) and the importance of co-ordinating the articulation of different policy measures and objectives, including the interaction between passive benefit schemes and active labour market measures (job search requirements and training).
The objective of this report is to develop the gender perspective to this labour supply debate in two ways. Firstly, through a review of some key recent national policy reforms to social protection systems and related labour market programmes which are designed to integrate low-income groups into employment and where the policy objectives relate to the theme of ‘making work pay’, largely through a focus on enhancing the financial attractiveness of employment relative to benefit receipt. In this discussion we consider whether gender mainstreaming of the policy occurred, and what gender impact these reforms might be expected to have.
Secondly, we turn to the wider incentives and barriers that are faced by those – still largely women – who take on the primary care role in households with young children, with a particular emphasis on the situation of mothers in low-income households (tax and benefits, active labour market policies, childcare, etc.).
This report is based on the reports prepared by the 30 national experts in the Group of Experts on Gender, Social Inclusion and Employment. In Section 1 we review some of the recent national reforms or policy debates in relation to the ‘making work pay’ agenda from a gender perspective. This draws on reports for the 15 pre-2004 Member States and the 5 non-EU countries included in this network. The national experts for the 10 new Member States did not contribute to this part of the report because they had the additional task of preparing an evaluation of the gender mainstreaming of the first National Action Plans on Social Inclusion submitted by their governments1. Sections 2-5 draw on material from all 30 countries. In Section 2 we review maternity and parental leave provisions in relation to the employment integration of mothers and fathers. The impact of parental leave or extended labour market absence for childcare on eligibility for active labour market measures and other training provisions is discussed in Section 3. The development of childcare services as a key social infrastructure for supporting parents’ employment is reviewed in Section 4. Conclusions are drawn in Section 5, which also raises demand-side considerations about job quality and hence employment sustainability for the main carers (typically mothers) in low-income households.
The policy focus on ‘making work pay’ varies between the 20 countries (EU-15 plus the 5 non-EU countries) which we have reviewed. In countries with limited social protection coverage for the working age population the emphasis of policy debates and reform is largely centred on extending social protection, as is the case in Greece and Italy. A similar situation of limited social protection coverage also applies to many of the new Member States, as indicated in their 2004 NAP/Inclusion reports and in Bulgaria and Romania in their preparation for joining the EU. In contrast, in many of the countries with more extensive social protection systems there are examples of recent tax/benefit reforms designed to improve the financial work incentives of the unemployed and inactive and thePage 6 low-paid employed. The examples presented in the national reports and discussed here are:
• Tax credits targeted at the low-paid have been introduced in Belgium, France and the UK.
• General tax reductions have been made in Luxembourg, Austria and Iceland (and more recently in Italy).
• The system of unemployment support (either unemployment insurance and/or social assistance) has been reformed in a number of countries to tighten the eligibility criteria and/or reduce benefits, and to introduce more stringent job search conditions (Denmark, Germany, France, the Netherlands, Austria), while in Ireland this process has happened largely through the budget failure to uprate benefits which has undermined some recent positive measures to support integration into employment and education. In Portugal unemployment coverage has been extended, but accompanied by more stringent job search requirements.
• Disability pensions have been reformed to tighten eligibility and promote employment re-integration in Norway as a key part of social protection reform to enhance labour supply incentives.
In most of these countries there exists an explicit policy objective of ‘making work pay’ or removing unemployment and poverty traps for the unemployed and low-paid. However, this was not always the case – this was not a major consideration in the tax reforms in Luxembourg, the tax and unemployment benefit reforms in Austria were introduced without a public policy debate about ‘making work pay’, and in Portugal the rationale presented for reforming social protection for the unemployed was to combat fraud and make the system more equitable.
However, in the other countries in this study there has been little or no emphasis on tax/benefit reform:
• In Greece measures to help the unemployed into employment focus on wage subsidies for job creation and measures to make part-time work more attractive.
• In Finland proposals were made to subsidise low-paid jobs but these have been shelved.
• In Italy the proposal for benefit reform to extend social protection coverage has been postponed again. The lack of coverage means that there are no widespread problems of the ‘unemployment’ or ‘poverty’ trap, for only one in every five job-seekers receives some form of benefit and the vast majority rely on their families for economic aid.
• In Bulgaria and Romania there is no sustained debate about ‘making work pay’; instead in the preparation for EU membership the focus is on preparing the legal and institutional processes and developing economic and social policy in line with EU guidelines and requirements. Here the main issue is about extending social protection and introducing labour market programmes to enhance employability.
• In Lichtenstein a ‘making work pay’ debate is absent, and a more general debate about socio-economic reform is only just beginning in relation to rising social expenditure.
• In Spain a key focus in relation to ‘making work pay’ is on work-family reconciliation measures for mothers.
• In Sweden, while tax/benefit reform in relation to ‘making work pay’ is a perennial topic that has been stimulated by the EES, no reforms have been made. Here the most relevant recent reform is the extension of childcare subsidies, which studies predict will further enhance mothers’ labour supply, particularly for those in lower-income households.
There is a general lack of gender mainstreaming or impact assessment in the reforms which have been implemented or discussed. The absence of gender mainstreaming may indicate a lack of political commitment to promoting gender equity in some cases, or at the very least a failure to develop and implement suitable gender mainstreaming procedures. In some examples of policy reform, gender mainstreaming is developing but is still uneven. Here gender is discussed only in relation to certain groups where it is recognised either explicitly or implicitly that women predominate, such as amongPage 7 lone parents. The tax credit reform in the UK is an example of where the policy was informed by an awareness of many of the gender impact implications, and where this gender perspective has been sharpened through dialogue between various social actors and the government. However, some of the weak elements in the policy design that were identified in this dialogue about gender impact have been retained by the government, which illustrates how issues may be exposed through gender impact assessment but they may not be resolved due, for example, to their conflict with other policy priorities or a lack of political will.
Summary: The national ‘making work pay’ policy debate or reform discussed in the national experts’ reports for 20 countries
BE: Introduction of the earned income tax credit (CIBRAP), 2001
Reforms to the earned income tax credit (CIBRAP) and proposals to reform the Income Guarantee Allowance
DK: Social assistances for the unemployed reduced to enhance financial work incentives under the ‘More people into work’ reform
DE: The ‘Hartz IV’ reform of unemployment benefit insurance and unemployment assistance
Expansion of ‘mini-jobs’ excluded from social protection coverage
EL: The focus of ‘making work pay’ policy reform is on wage subsidies and the creation of part-time jobs
ES: Work/family reconciliation measures are at the heart of the ‘making work pay’ debate
FR: The employment tax credit (the PPE) and transitional benefit retention for the unemployed entering employment (Intéressement)
Unemployment benefits reformed and new employer subsidies for recruiting the unemployed to minimum wage jobs
IE: Longstanding issues identified in the National Anti-Poverty Strategy to remove unemployment and poverty traps so as to ‘make work pay’
The household-based emphasis in the tax/benefit system in Ireland
IT: Extension of social protection for the unemployed is postponed again
LU: Personal tax reform to reduce the already low tax burden, but few supply-side incentives for married women to enter employment
NL: ‘Making work pay’ through tax/benefit reform
The new Dutch ‘Work and Social Assistance’ Act (Wet Werk en Bijstand, WWB) came into force on 1 January 2004
AT: The 2004-05 tax reform reduces tax payments for those with low earnings, with some reductions targeted at low-income families
Reforms to the tax/benefit system are designed to enhance work incentives
PT: Benefit reform for the unemployed and proposals to extend household-based means-testing
FI: Controversial proposals to subsidise low-wage jobs and expand the ‘working poor’ are deferred
SE: Sweden – high employment rates for both women and men suggest that social and economic policies have succeeded in ‘making work pay’
UK: In-work benefits for employed parents on low income were extended in 2003 with the new Child Tax and Working Tax Credits
Summary: The national ‘making work pay’ policy debate or reform discussed in the national experts’ reports for 20 countries (cont.)
BG: There is no sustained debate about ‘making work pay’ through tax/benefit reform in the preparation for EU membership
IS: Tax reductions are the main element of recent tax/benefit reforms
LI: The buoyant economy means there is little pressure to stimulate debate for tax/benefit reform to ‘make work pay’, however employment rates for women are low
NO: Reforms to unemployment benefits and disability pensions to promote employment re-integration and ‘A more inclusive working life’ (the IA-agreement between the Norwegian government and the social partners in 2001)
A new initiative to integrate immigrant ethnic minorities into working life
RO: A number of reforms have been implemented in relation to the EES guideline 8 measures to ‘make work pay’ and the National Anti-Poverty and Social Inclusion Plan
Note: The national experts for the 10 new Member States were not asked to contribute to this part of the work programme, see introduction for explanation.
The neglect of gender mainstreaming in policy design is replicated in flawed policy evaluation, and the efficacy of policy is undermined by this failure to attend to gender mainstreaming. Thus, it is common for assessments to focus on the short-term, immediate financial incentives of tax/benefit reform in isolation from considerations of whether there are enough jobs available, working conditions (working hours and job quality) and childcare and other social infrastructure such as transport. The focus on the households as an aggregate unit means that the different opportunities and lifetime earnings trajectories of women and men within a gender segregated labour market are usually ignored. Furthermore, longer-term considerations are typically neglected both in terms of the micro-level of the lifetime employment and income profiles of household members, and the macro-level of social integration, labour demand and the types of low-wage jobs being subsidised by social protection reforms.
In particular, gender mainstreaming produces a different angle on the perennial debate about tax levels and the cost of social protection systems. Put simply, what is the gender impact of lowering tax rates or reducing benefits? Do women disproprotionately bear the costs of public expenditure cuts as public sector employees? Are tax cuts the key issue to ‘make work pay’ for women, or is a more effective focus that of improving childcare and the social infrastructure to make it easier for those with care responsibilities to take employment, funded by tax increases if necessary? Here falling birth rates across Europe may be one indication of the difficulties of work-family reconciliation, and in itself may be reason enough to review tax/benefit reform from a broader gender perspective than narrower debates about ‘making work pay’.
Entitlements to maternity and parental leave provide an employment integration mechanism in two key ways. They encourage women to enter employment and/or work full-time up to the birth of a child to build up entitlement. The rewards from employment are largely protected from deterioration, in contrast to the situation faced by women who are forced to quit and then re-enter the labour market when they want time off for child-rearing.
Long periods of leave can carry some risks, depending on how they articulate with other policies and labour market conditions. If mothers take long periods of leave while fathers do not this can reinforce women’s ‘second earner’ status and the impact upon a woman’s career can be detrimental in terms of the risk of discrimination, and can translate into reduced job progression and lifetime earnings. In the short-term, from a household perspective it may not make financial sense for the woman to use expensive childcare rather than taking long leave, but over their lifecourse women may find themselves financially disadvantaged because of extended interruptions in their labour market participation.
However, if leave entitlements are too short this can create other types of labour supply disincentives. New mothers may exit the labour market rather than taking the short leave on offer if they are unwilling or unable to cope with resuming employment when they have a very young child. Alternatively, mothers may be obliged to re-enter earlier than they would like to due to financial pressures or worries about job insecurity, and this latter situation may deliver a high labour market participation rate for mothers of young children but largely through compulsion rather than measures that enhance opportunities for parents to try and reach their preferred arrangement.
The impact of parental leave provisions upon the integration and re-integration of mothers and fathers is shaped by whether the leave is paid; the length and flexibility of the leave entitlement, whether fathers use the leave as well as mothers, and whether leave provisions are complemented by public funding of childcare.
The provision for maternity leave is more uniform across the countries in comparison to the parental leave arrangements. In most of the 30 countries studied, statutory maternity leave is generally 14-20 weeks and supported by a high earnings-related payment (80-100%). The UK, Estonia, the Czech Republic, Hungary and Slovakia have longer leave periods, which in the cases of the UK, the Czech Republic and Slovakia are supported by lower payment levels. Two countries – Iceland and Norway – do not have separate maternity and parental leave provisions; rather a period of the parental leave is reserved for the mother, another portion for the father and the remainder can be taken by either parent.
Statutory parental leave entitlements vary in terms of the length of leave, the level of financial compensation, and whether it is a non-transferable entitlement attached to the individual parent or a family entitlement that the parents decide how to allocate between them. Statutory entitlements and high earnings replacement rates promote take-up. However, parental leave is unpaid in 9 countries and in another 10 the payment is limited. Parental leave entitlements intersect with other policies which affect take-up, in particular the availability of childcare services. Where childcare services are limited, extended parental leave may serve to defer labour market exits but do little to promote employment resumption at the end of the leave period. Take-up is affected by other workplace factors – such as whether the firm offers enhanced parental leave and other reconciliation measures, and whether the organisational culture supports and encourages employees to make use of their parental leave entitlements or penalises them. High unemployment and widespread redundancy is also a major deterrent to the take-up of parental leave, which is highlighted as a particular problem in the reports for several of the new member states. The national assessments of the way that the parental leave provisions shape women’s return to employment are summarised in an Appendix to the report.
The level of flexibility given in leave arrangements is central to the take-up rates of both mothers and fathers. Sweden is often given as the example for a parental leave scheme which is both generous and flexible. Some degree of flexibility is being introduced into parental leave arrangements in many of the other countries in this study. Examples are the use of parental leave on a part-time basis, the ability to use blocks of leave rather than take leave in a continuous period; the right to defer leave and the right to reduce working hours. There has also been some development in a few countries in establishing employee ‘right to request’ reduced or flexible working hours in negotiations with their employer, which is a distinct provision to that of parental leave.
Where flexible provisions exist in parental leave policies they are not always widely used for a number of reasons, including the complexity of the legislation or workplace obstacles. Similarly, the efficacy of the ‘right to request’ legislation depends upon the detail of the legislation, and the grounds on which requests can be rejected and appealed.
Fathers do not have a statutory right to paternity leave at the birth of their children in 13 countries in this study. Fathers have a statutory right to take parental leave in all thirty countries studied, but in most countries there are few incentives for fathers to do so. This is because the entitlement is eitherPage 10 unpaid or can be transferred to the mother; hence the inducement for fathers to ‘use it or lose it’ is quite modest in practice. Men’s take-up of parental leave is very low in most countries.
A statutory entitlement with an individual non-transferable element reserved for fathers supported by a high level of earnings replacement and some flexibility in how the leave is taken are key conditions for promoting male take-up. Workplace practices and cultures are also important for conveying whether or not it is acceptable for fathers to take parental leave.
Men make more use of parental leave when they live in countries where there is an individual or reserved entitlement supported by a high earnings replacement rate, but they still take much less leave than mothers in these countries. The low male take-up of parental leave operates to reinforce the unequal gender division of labour, whereby looking after children is equated with ‘women’s work’. This fuels gender discrimination in the labour market, whereby parental leave provides some measure of re-integration into employment for mothers, but post-leave they may be at risk of reduced opportunities for training and job advancement at their workplace.
In general parents who use parental leave are formally eligible for active labour market measures as they retain their employed status and associated protection and benefits. Hence, formally they are no more vulnerable to redundancy and are entitled to the same active labour market measures as others facing redundancy and unemployment. However, in practice those on parental leave may be more vulnerable to redundancy or pressures to resign, where those classified as having resigned are ineligible for active labour market policies.
In a number of countries, eligibility criteria for active labour market policies focus on the registered unemployed and fail to address the specific situation of both women on an extended period of parental leave and in particular in women returners. The problem of neglecting the integration issues for women returners seems to be emerging in the new active labour market policies in Germany, Ireland and the UK. In Germany the reforms of unemployment policy in 2003 have concentrated active labour market programmes on those persons who are recipients of unemployment benefits, making it difficult for many women returners to meet the eligibility requirements. A similar problem emerges in Ireland, where only those in search of and available for full-time work are eligible for unemployment benefits, so that much of women’s unemployment is hidden as ‘economic inactivity’, adversely affecting their access to labour market programmes. The UK’s ‘New Deal’ programme focuses upon benefit claimants (unemployed, disabled) or spouses of benefit claimants; women returners with an employed partner are excluded from the active labour market measures.
Examples of good practice can be found in a number of countries, where there are measures designed especially for ‘returners’ as well as for unemployed parents, for example in Austria and Lithuania; while in Greece all active labour market programmes are accessible to all the unemployed – not only to unemployment benefit claimants – provided that they register with the Manpower Employment Organisation (OAED).
Similar issues emerge in relation to eligibility for lifelong learning or other training provisions. In terms of formal entitlements, in the majority of countries parents on an extended period of leave or women returners are eligible for training/lifelong learning. Exceptions can be found in Germany, Ireland and Iceland where eligibility for training is premised on the receipt of unemployment benefits.
However, there may be ‘informal barriers’ that create obstacles to the take-up of existing opportunities. In particular, childcare constraints – in terms of price, opening hours or urban location – while attending training courses was identified as a barrier in the national reports for Spain, France, Luxembourg, Portugal, Cyprus, Poland and the Czech Republic.
Although lifelong learning initiatives have been given more emphasis in the employment guidelines, there has been a relatively limited development of an equal opportunities dimension to lifelong learning initiatives with many schemes focusing upon those in full-time employment rather than parents hoping to re-integrate into the labour market. Furthermore, the national reports for nine Member States specifically highlight that there is no, or a limited, lifelong learning tradition (Austria, Denmark, Italy, the UK, Cyprus, the Czech Republic, Estonia, Lithuania, Lichtenstein), a problem which is also raised in the Bulgarian national report.
In some countries there are some national programmes targeted specifically at women returners. For example, in the Flanders region of Belgium training credits were introduced that allow for career breaks or reduced working time for training and learning leaves for part-timers. In France, the new social cohesion plan continues the previous provisions of paying for childcare for those in training after a period of parental leave and discounting periods of parental leave in calculating eligibility conditions for rights to training. Italy’s new law on parental leave gives a right to up to one year’s unpaid leave for lifelong learning. In the UK and Lithuania the new national strategies on skills and lifelong learning include targeted provisions for women returners as policy objectives, while in Cyprus the Human Resource Development Authority runs special training sessions for women returners. However, in Germany specific provision for women returners has been phased out and employers no longer receive subsidies when hiring a returner, and participation in further training is no longer paid.
While the majority of national programmes are linked to employment status, in Sweden the adult education project makes grants available for those who missed out on the upper tier of secondary education; women account for 67% of the participants and this provides a potential re-integration mechanism for women returners with low qualification levels.
In some countries there have been developments in legislation or collective agreements to encourage employers to provide training for those returning after a period of parental leave or a labour market exit. In Spain for example, some collective agreements include special clauses providing access to continuous training for employees on parental leave. In Portugal, legislation exists which obliges employers to provide returnees with training and refresher workshops (Art.º 48.º of the Labour Code). However, access to this often depends on the timing of training and the availability of childcare. In Luxembourg, within the framework of the positive actions subsidised by the Ministry of Equal Opportunity, some companies take into account the gender dimension as far as the lifelong learning of their staff is concerned. In Italy in 2002 a special fund was allocated to companies that signed collective agreements promoting family-friendly flexibility as well as training for mothers/fathers returning to work after parental leave. However, despite the availability of funding there is a general lack of flexibility and/or refresher training plans and there seems to be a lack of interest towards these issues at the company level in Italy.
The availability, cost, compatibility between service hours and working hours, and quality of childcare services vary across the 30 countries. Good quality, affordable childcare services are a key mechanism for facilitating the employment of those parents, particularly mothers, with care responsibilities. However, the impact of childcare services on labour supply and employment continuity over the lifecourse depends on the articulation of childcare policy with other policy mechanisms – leave provisions, tax and benefit policies and also labour market policies which affect the wage and other working conditions on offer.
In general, the availability of childcare places relative to demand across all age groups is highest in the five Nordic countries (Denmark, Iceland, Finland, Norway, Sweden), the Netherlands and Slovenia. Some countries – such as Belgium, France and Italy – have high coverage rates for the over threes but much more limited provision for the under three-year-olds. There are important regional variations in some countries, for example childcare services are more developed in East than in West Germany, in the North of Italy compared to the South, and in urban rather than rural areas in Lithuania.
Improvements in care provisions have been achieved in the pre-2004 EU States, stimulated by the Barcelona target. However, there are still major shortfalls in availability and affordability.
Trends in the new Member States are more mixed. In Poland, Bulgaria and Slovakia there has been a decline in available childcare services. The main reason is public expenditure constraints. A similar reversal has occurred in other countries such as Bulgaria, following the transition to a market economy.
Levels of childcare provision for the under threes remain much lower than that for those aged between three and compulsory school age. The level of provision bears little relationship to the length and financing of parental leave in the country. Childcare services for the under threes are often provided by the private sector, in contrast there is greater public provision or financing for older pre-school children.
The costs of childcare are identified as a key problem across the countries, with few exceptions. The only national reports which state that childcare is not expensive and is free or highly subsidised for parents on low income are Sweden, Denmark and Slovenia. The costs faced by parents are generally higher in private sector provision than in public sector services. Costs related to wages are rising in some countries.
A number of countries provide childcare subsidies or allowances which are income-related, although some target subsidies only at low-income households and/or those participating on certain labour market or training programmes. In most countries the structure of relief and allowances is designed to offset only part of the childcare costs. Thus in many countries the cost of childcare is a major obstacle for those with limited earning prospects. Where childcare costs are high this creates incentives for mothers to prolong parental leave and/or to take up allowances available to non-employed carers of young children where these exist.
The way that childcare costs can reduce the financial returns from employment can become particularly acute for lone parents. Additional or specific measures targeted at lone parents in recognition of the additional cost and time pressures such households face are often an important means of ‘making work pay’ for such parents. The extent and form of additional support for lone parents is uneven across countries, and is a particular concern in some of the new Member States.
In most countries there is a problem of incompatibility between the opening hours of childcare services and the working hours of many parents. This remains a key problem even in countries where childcare is available and affordable, for example, in Denmark and Slovenia.
There are some signs that operating hours have been extended to cope with the needs of working parents in a number of countries but the expansion is insufficient to cope with the long or flexible working patterns required from parents in many workplaces. The mismatch is typically greater for parents employed in the private rather than the public sector, although parts of the public sector also have extended or variable operating hours, for example in hospitals.
Some countries have school hours that also conflict with working patterns. For example, in France, there is no school on Wednesdays, and at this time three quarters of 3 to 6 year olds are cared for by parents. In Latvia, the short school hours (8.30-11.00/12.00 for 5-10-year-olds) also cause a compatibility problem. After-school care is still underdeveloped and where available appears to be costly. For example, in Belgium after-school care is quite widespread, but there is often a charge and the quality of care can be low. In Portugal, private childcare is found to be more flexible in terms of opening hours but this serves to disadvantage those who cannot afford this.
Some countries are trying to develop facilities that reflect changing working patterns. For example, in Finland the municipalities operate 24-hour day care to provide care for the children of parents who do shift work but there is a shortage of such places.
The quality of care is becoming the focus of public debate in many countries and governments are taking steps to introduce higher standards. Quality problems can make parents reluctant to use thePage 13 care on offer even if it is available. Childcare quality is highlighted as a particular problem in Romania, in relation to concerns about after-school provision in Belgium and as a particular issue in the National Childcare Strategy in the UK.
In countries where quality issues are not a problem, for example in Finland and Sweden, the emphasis is upon improving the value and careers of care workers through improving pay levels and training opportunities.
Childcare workers are mainly women, and in most countries the work is low-paid, with the accompanying assumption that it is low-skilled. This is contributing to the shortages of experienced childcare workers in a number of countries, for example the UK and Germany. Improving the status, pay and opportunities for career progression within this field will both improve job opportunities for women and contribute to raising the quality of the care services available.
• A gender mainstreaming (GM) perspective was generally lacking, uneven or carried little political influence in the recent and various national tax/benefit reforms or debates that relate to ‘making work pay’ reviewed in this study. Yet the national reports have demonstrated that a potential gender differentiated impact can be identified when a GM perspective is brought to the analysis.
• Where a gender perspective has been developed it usually stops at the point of identifying certain target groups where it is recognised – either explicitly or implicitly – that women predominate, such as among lone parents or ‘second earners’ in couples. The assessment and policy design rarely considers the labour market and household processes which give rise to these outcomes. Here a key, and familiar process, is that the gendered division of care responsibilities has a two-fold outcome: women are more likely to become lone parents or ‘second earners’ while at the same time being less able than men to secure well-paid employment on average.
• Even where a developed gender impact assessment (GIA) has occurred the issues exposed may not be dealt with due to competing political priorities. For example, the negative impact of household-based assessments on the work incentives of ‘second earners’ are well-known yet many governments refuse to tackle this question in tax/benefit reform because they wish to target support on ‘the family’ as an aggregate unit.
• Thus, in most countries there are still elements of policy design which undermine efforts to ‘make work pay’ for women by constructing and reinforcing their role as a ‘second earner’ that is presumed to reside with an employed man who has the role as ‘main earner’ for the family. This is not merely a legacy of old policies which were developed in an earlier era, this presumption and neglect of gender mainstreaming is evident in some of the recent reforms discussed in this report.
• The traps for ‘second earners’ in the tax and benefit systems which result from failing to address the implications of GIA mitigate against broader policy pushes to ‘make work pay’ for all the non-employed. The tax credit reforms in Belgium, France and the UK illustrate some of the design issues that need to be considered when attempting to design policies which ‘make work pay’ for low-income households in ways that do not increase or create traps for the ‘second’ earner.
• The well-known root of the problem is how to protect low-income households from poverty by guaranteeing an adequate minimum income while also ‘making work pay’. A key issue is how to direct resources to help low-income families with the costs of raising children without exacerbating the marginal tax rates faced by their parents when seeking to enter employment or to move from part-time to full-time work.
• Reforms which have targeted additional means-tested support at low-income families with children have negative as well as positive impacts from a GM perspective. The positive impact is that the higher income reduces the financial pressures on the carer to take employment regardless of the quality of either the job or the available childcare. However, the negative effects are where the reform raises the effective marginal tax rates and so create ‘traps’ which make labour market entry difficult for mothers with low-earnings prospects.
• One of the solutions advanced by many anti-poverty and feminist campaigning groups is that universal (not means-tested) child benefit provides the most neutral system of redistribution for this has little impact on marginal tax rates.
The additional costs of a universal over an income-related benefit can be redeemed in the tax system, for example by making child benefit into a tax credit for higher earners. Furthermore, from a GM perspective, payments of such benefits/credits to the parent providing most of the day-to-day care ensures that the resources are targeted at the carer who is usually responsible for the day-to-day budgeting and expenditure in relation to children, thus providing an effective means of channelling resources to children in low-income households.
• In relation to ‘making work pay’ for carers, childcare services and some other work-family reconciliation measures have expanded, and this is clearly a positive development in relation to facilitating employment. However, here too there are risks:
– The expansion of affordable, good quality childcare lags behind the changing policy presumptions of social protection systems that mothers of young children should be active job-seekers in the push to raise-women’s employment rates. Here the recent reforms to social assistance in Germany and the Netherlands are examples of reforms which aim to co-ordinate the development of childcare services with increased job search requirements for carers, and monitoring of the development of these new policies may provide important lessons for other Member States.
– There is a risk of political complacency that recent expansions in childcare services have solved the problem, yet shortfalls remain in childcare and other reconciliation issues. Furthermore, measures are still largely targeted at women and the promotion of men’s use of parental leave and working-time adjustments is underdeveloped. Notable exceptions are the reserved ‘Daddy leave’ provisions in Sweden and Norway, which are important initiatives yet the leave reserved for fathers represents only a small portion of the total leave period available to the family. The impact of such systems has to be evaluated and monitored for its long-term effects on promoting a more equitable gender division of labour by shifting the attitudes and behaviour of mothers, fathers and employers as to what constitutes ‘normal’ and ‘acceptable’ roles for mothers and fathers.
– The impact of long leave provisions on women’s subsequent employment and earnings profile needs to be monitored.
• The failure to gender mainstream the ‘making work pay’ debates not only undermines progress towards gender equity; gender mainstreaming provides a different vantage point as the basis for designing more effective policy solutions for a range of social and economic objectives. For example, gender mainstreaming exposes the articulation between tax/benefit systems and childcare services, the potentially negative reverberations of tax cuts on women’s public sector employment, or the limited efficacy of current solutions put forward to address the problem of falling fertility rates. When these broader linkages are acknowledged then it becomes evident that tax/benefit reform needs to be evaluated from a gender perspective that is broader than narrow supply-side debates about ‘making work pay’.
• A ‘gender-sensitive’ checklist for evaluating social protection reform could help to inform the detail of gender impact assessments of ‘making work pay’ debates, summarised on the next page.
A gender-sensitive checklist for applying Gender Impact Assessments to social protection (tax/benefit) reform
Are typically male patterns of labour market behaviour assumed to be the norm for both sexes, or are the actual, current patterns of women’s labour market behaviour and opportunities accommodated in the policy?
Does the reform promote a more equitable distribution of resources and bargaining power between women and men within the aggregate unit of couple/family/household?
The assessment should not only focus on how much is being redistributed to which kinds of family unit; they are also relevant to address where the resources come from, who receives them within the family, what purpose they are intended to serve and what the transfer is labelled in order to analyse whether the redistribution promotes more equitable norms and patterns of behaviour for gender relationships, both within the home and outside.
Scale is important. The impact of any reform should be assessed in relation to pre-existing patterns of gender inequalities, and therefore in relation to the distance still to be travelled towards gender equity.
The effect on ‘capabilities’ and hence men and women’s abilities to achieve longer-term security and autonomy from a dynamic, lifecourse perspective is assessed.
Source: Adapted from Bennett (2002)2
• Debates about tax/benefit reform and work-family reconciliation to ‘make work pay’ must not lose sight of the problems of persistent sex discrimination and the poor job quality (low pay, insecurity, time schedules which are incompatible with care commitments) which limited the employment sustainability experienced by many of those – mainly women – with care responsibilities.
These problems have to be kept visible within the more narrow debates about tax/benefit reform to promote work incentives.
 C. Fagan and G. Hebson (2004), Gender Mainstreaming and the Social Inclusion Process in the first National Action Plans (2004) of the 10 new Member States. The co-ordinators’ report for the EU Expert Group on Gender, Social Inclusion and Employment (EGGSIE) to the Equal Opportunities Unit, Directorate-General for Employment, Social Affairs and Equal Opportunities of the European Commission, Brussels, September.
 F. Bennett (2002), ‘Gender implications of current Social Security reforms’, Fiscal Studies, December 23(4), pp.559-585.