Between workfare and enablement – The different paths to...

Between workfare and enablement – The different paths totransformation of the welfare state: A comparative analysis ofactivating labour market policies

IRENE DINGELDEYCentre of Social Policy Research, University of Bremen, Germany

Abstract. The concepts that address different paths to transformation of the welfare state asa ‘workfare’, an ‘enabling’ or an ‘activating’ state share the idea that traditional welfarepolicies, mostly aiming at decommodification, are more and more replaced by social policiesemphasising (re-)commodification.Activating labour market policy therefore is supposed toplay a central role within the paradigm shift of welfare state policies. It is understood toinvolve a mix of the enforcement of labour market participation, the conditioning of rightsand growing obligations of the individual at one side, and an increase of services in order topromote employability and restore social equity at the other. In this article, the differentperceptions of the workfare and the enabling state perspectives on the positive and negativeaspects of activating policies are reconstructed as ‘pure forms’ in order to obtain theoreticalstandards against which the empirical cases of activating labour market policies in Denmark,the United Kingdom and Germany are characterised and compared. The actual reform pathis described by a combination of two indicators: the strength of the workfare and the strengthof the enabling elements of the activating labour market policies.The evidence on activatinglabour market reforms confirms that in both dimensions a move in the same direction istaking place, but without producing growing convergence. Different welfare state types keepon producing different mixes of workfare and enabling policies, leading to very differentlevels of decommodification and (re-)commodification. Thus, an ongoing divergence ofpolicies also exists within the new paradigm of an activating labour market policy, althoughsingle countries seem to change their alignment to a particular welfare state type.

Some studies of social policy claim that the traditional postwar ‘Keynesianwelfare state’ has been transformed into a ‘Schumpeterian workfare state’(Jessop 1991, 1994, 1995; Torfing 1999a). Others conceptualise most recentwelfare state reform as a shift towards an ‘enabling’ (Gilbert 2002; Gilbert &Gilbert 1989) or an ‘activating’ state (Bandemer 2001; Mezger & West 2000;OECD 1990; Trube & Wohlfahrt 2001). Beyond the general perception thatthe welfare state ‘as we know it’ has changed, all these analyses share the ideathat traditional welfare policies, the key objective of which was decommo-dification, are increasingly being replaced by social policies emphasising(re-)commodification. Within this paradigm shift in welfare state policies,activating labour market policy (activating LMP) is supposed to play a central

European Journal of Political Research 46: 823–851, 2007 823doi: 10.1111/j.1475-6765.2007.00712.x

© 2007 The Author(s)Journal compilation © 2007 (European Consortium for Political Research)Published by Blackwell Publishing Ltd., 9600 Garsington Road, Oxford, OX4 2DQ, UK and 350 Main Street, Malden,MA 02148, USA

role. Regardless of approach, it is widely agreed that activating LMP combines,on the one hand, the enforcement of labour market participation, the condi-tionality of rights and the placing of increasing obligations on individualworkers and, on the other hand, an expansion of services intended to promoteemployability and restore social equity. Broadly speaking, the workfareapproach emphasises the negative elements of these developments, whereasthe enabling or activating state approach underlines the positive aspects. Todate, there have been few in-depth studies of how different mixes of thevarious policy elements produce different national policies and lead in turn todifferent versions of the enabling state (Gilbert 2002), different workfarestrategies (Torfing 1999b) or different paths towards activation (Barbier &Ludwig-Mayerhofer 2004; Ludwig-Mayerhofer & Wroblewski 2004). Further-more, the question of whether the indicated changes are leading to greaterconvergence within the new paradigm of welfare state development or tocontinuing divergence still needs to be answered.

In this article, analysis of activating LMP in Denmark, Germany and theUnited Kingdom, which represent three different welfare state types asdefined by Esping-Andersen (1990), is linked to a characterisation of differentpaths towards welfare state transformation. For the purposes of the analysis,the differences between the workfare and enabling state approaches are delib-erately exaggerated in order to redefine ‘workfare’ and ‘enabling’ policies asideal types, with policies designed to enforce labour market participation andreduce welfare being attributed to the former and policies to improve skillsand enable labour market participation through an expanded supply of ser-vices to the latter. The actual path to reform may then be described by acombination of two indicators: the strength of the workfare elements and thestrength of the enabling elements of activating LMP. On the basis of thisanalytical approach, it will be argued that different mixes of workfare andenabling policies point to the existence of different development paths withina new paradigm of welfare state transformation.

The different approaches to welfare state transformation

The workfare state

The argument that the ‘Keynesian welfare state’ is being transformed into a‘Schumpeterian workfare state’ has been advanced in particular by the regu-lation school, which emphasises macroeconomic changes and the productivistaspects of welfare reform. According to Bob Jessop, one of its most prominentauthors, the break between the two regime types with respect to social policy

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© 2007 The Author(s)Journal compilation © 2007 (European Consortium for Political Research)

is marked by three characteristics: ‘(1) domestic full employment is repriori-tised in favour of international competitiveness; (2) redistributive welfarerights take second place to a productivist re-ordering of social policy; and (3)the primary role of the national state is deprivileged in favour of governancemechanisms operating on various levels’ (Jessop 1994, 1999: 16).

In employment policy in particular, major changes are seen in the shift fromKeynesian demand management to management of the supply side andincreasing the flexibility of labour markets in order to create new jobs. The‘workfare’ characterisation is justified by an observable change in theworkfare-welfare mix; the shift from the passive provision of transfer pay-ments to labour market activation programmes is interpreted as a transitionfrom unconditional rights combined with almost no obligations to the increas-ing conditionality of social rights linked to obligations (Torfing 1999a: 374). Inthis context, labour market activation, and particularly ‘welfare to work’ pro-grammes, are seen as paradigmatic of modern ‘market workfare’ becauseemphasis is placed on the pressure (or even compulsion) for the unemployed,particularly welfare recipients, to (re-)enter the labour market, even withlow-income jobs (Grover & Stewart 1999; Lødemel & Trickey 2000).

The enabling welfare state

The notions of the ‘enabling’ and the ‘activating’ state are fairly broadapproaches to reform of the state that highlight changes in the governance ofthe public-private mix or the transfer-service mix. Thus the paradigm shiftfrom the traditional welfare state to the enabling welfare state is described asa change from ‘universal access to publicly provided benefits that offer strongprotection of labour as social rights of citizenship’ towards a ‘market orientedapproach that targets benefits that promote labour force participation andindividual responsibility’ (Gilbert 2002: 44). The increased emphasis onemployment-related measures is supposed to be accompanied by the devel-opment of social programmes aimed at enhancing human capital and helpingthe unemployed to adjust to modern labour market requirements. Benefits areincreasingly linked through incentives and sanctions to behavioural require-ments (Gilbert 2002: 45).

Above all, the normative strand within the enabling and activating stateapproach underlines the reciprocity between welfare state and benefit claim-ants as a new balance of ‘rights and responsibilities’ (Giddens 1998: 65). In thenew concept of citizenship, the individual is supposed to be involved actively inthe production of social welfare and to participate in decision-making pro-cesses (Olk 2000: 112ff). In exchange, the welfare state is expected to enable allcitizens to participate actively and to take responsibility for themselves by

a comparative analysis of activating labour market policies 825


providing a framework of infrastructure and services that offsets unequalopportunity structures (Bandemer & Hilbert 2001: 69; Giddens 1998; Gilbert2002; Gilbert & Gilbert 1989: 8; Mezger & West 2000). Thus the coerciveaspects of the paradigm shift play a less central role than in the workfareapproach (Dahme & Wohlfahrt 2003).

The various approaches to activating LMP have been outlined by varioustransnational and international organisations. Around 1990, the Organisationfor Economic Cooperation and Development (OECD) advanced the notionof the ‘active society’ (in the sense of facilitating access to work for all) as afuture social policy scenario. The ‘New Framework for Labour MarketPolicies’ is centred around the improvement of employability, particularly fordisadvantaged groups, and places special emphasis on support for womenseeking to enter the labour market.1 Recommended policy measures includetraining policies to improve human resources as well as a combination ofvarious types of income support to avoid work disincentives. In this context,activation is regarded as positive and based on the idea of fostering ‘economicopportunity and activity for everyone in order to combat poverty, dependencyand social exclusion’ (OECD 1989, 1990: 8). From a similar standpoint, theEuropean Union (EU) has also advocated policy reforms designed to ‘acti-vate’ employment policy, with ‘employability’ having been adopted as a majorgoal since the Luxembourg meeting of 1997 (Aust 2000; Keller 1999; Lefresne1999).

Convergence or divergence in the development of the welfare state?Measuring the mix of workfare and enabling elements

A few empirical studies of activating LMP argue that policies are convergingin different, albeit quite similar, welfare states (Cox 1998; Drøpping et al.1999). In contrast, Torfing (1999b: 17) identifies divergent workfare strategies.In order to capture developments in Denmark, activating LMP is character-ised as follows: ‘(1) activation rather than benefit and wage reductions; (2)improving the skills and work experience of the unemployed rather thanmerely increasing their mobility and job-searching efficiency; (3) training andeducation rather than work-for-the-benefit (quid pro quo); (4) empowermentrather than control and punishment; (5) more inclusive workfare programmesrather than programmes which only target the unemployed’. This dualisticapproach to strategy definition, however, enables us neither to identify differ-ent mixes of enforcement or enabling policies nor to delineate the mostly fuzzypolicy mixes in particular countries.

Other comparative studies, however, adopt a one-dimensional approach inemphasising the dominance of single policy elements in order to differentiate

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activation strategies across different welfare state types. Beyond the recalibra-tion of previous income compensation systems, universal welfare states aresupposed to invest in vocational training and provide complex and extendedservices to all citizens. For liberal welfare states, activating LMP is defined inparticular as encouraging individuals to seek work and promoting financialincentives such as tax credits and ‘in-work benefits’. While continental orconservative welfare states are still developing, the shape of a possible thirdtype is not yet clearly defined (Barbier 2004; Barbier & Ludwig-Mayerhofer2004; Ludwig-Mayerhofer & Wroblewski 2004).

Using labour market spending as an indicator and comparing twelveEuropean countries, Hvinden (2004) developed a more encompassingapproach, but was limited to rather aggregated results. He found a generaltrend towards increasing work incentives through changes in the income main-tenance systems. This, however, did not wipe out general differences in spend-ing on cash benefits (total amount and relative to the number of unemployed).Similarly, the increase in public spending on activating labour market mea-sures varies widely across countries, with big differences in total expenditureand in spending relative to the number of unemployed. Although a positivecorrelation between substantially greater spending on active labour marketpolicy and improved labour market performance was found, the reason for thisfinding may not be revealed by quantitative analysis. What is needed, rather, isa more detailed exploration of the various mixes of enabling and workfarepolicies.

In this article, the different perceptions of the workfare and the enablingstate perspectives on the positive and negative aspects of activating policiesare reconstructed as ‘pure forms’ in order to obtain theoretical standardsagainst which empirical cases can be compared and characterised. The terms‘workfare’ and ‘enabling’ are used to denote ideal types of different combina-tions of policy elements intended to promote labour market participation.Workfare characterises coercive and enforcing elements with respect to labourmarket participation, which are produced by benefit cuts (level and duration),the tightening of eligibility criteria or the increasing conditionality of transferpayments and the introduction of work tests, mandatory labour market pro-grammes or work requirements. Enabling policies include the improvement oflabour market services – namely training programmes and placement services.Furthermore, certain aspects of infrastructure such as the supply of childcarefacilities will also be included because gender equality and mothers’ employ-ability can be assumed to be a general goal of activating LMP. Workfareand enabling policies are not understood as alternative paths to policy reform,but as mutually constitutive elements of an activating LMP. The extent ofworkfare and enabling policies may be estimated independently, so that the



actual reform path can then be described by a combination of two indicators:the strength of the workfare and the strength of the enabling elements of theactivating LMP.

The analysis is conducted for three countries: Denmark as a universal;the United Kingdom as a liberal; and Germany as a conservative/continentalwelfare state type. The available data on the development of the differentinstruments have specific deficiencies, particularly with respect to compara-bility. Consequently, our conclusions as to the similarities and differences inthe various mixes of workfare and enabling elements are drawn mainly onthe basis of qualitative estimates concerning the regulation of particularinstruments.

Activating labour market reforms in Denmark, the United Kingdomand Germany

Context and timing

Activating LMP was introduced at rather different times in Denmark, theUnited Kingdom and Germany. The pioneer in this regard was the newlyelected Social Democrat-dominated government in Denmark, which intro-duced activating LMP in its first labour market reforms of 1994. Since then,there have been further activating reforms in 1995 and 1998. With the mostrecent programme, ‘More People in Work’, which came into force in 2003, thenewly elected right-wing government changed the set of instruments andstressed different policy aspects, in particular reducing or eliminating state-funded opportunities for labour market inactivity (Andersen 2001; OECD2003).The success of the Danish labour market policy is reflected in a decliningunemployment rate, which has remained stable at around 5 per cent since 1997(OECD 2005a).

In Britain, activating policy began with the introduction of the job seeker’sallowance in 1996, when the Conservatives under John Major were still inpower. However, it really got under way with the election of New Labour andthe introduction of the New Deal or Welfare to Work programme, whichstarted in 1998, when unemployment was already falling. The New Deal wasfirst targeted at the young unemployed (NDYP), the long-term unemployed(NDLTU; ND25+ since 2001) and at lone parents (NDLP). In 1999, pro-grammes for partners of the unemployed (NDPU) were introduced, followedin 2000 by programmes for the unemployed aged 50 and above (ND 50+) andfinally in 2001 by programmes for disabled people (NDDP) (OECD 2002c:60).Additionally, in April 2000, a series of 15 employment zones (EZ) were set

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up in areas of very high unemployment to provide a new approach to helpingthe long-term unemployed in particular to find work (Finn 2005; Joyce &Pettigrew 2002). Thus there was a steady increase in the number of groupstargeted and a reform of specific regulations to make activation more inclu-sive. Unemployment has declined to about 5 per cent in recent years (OECD2005a).

As a consequence of German reunification, it was not the restructuring butthe expansion of traditional instruments of active labour market policy, par-ticularly job creation schemes, that was on the agenda at the beginning of the1990s (Heinelt & Weck 1998). Although there were some cuts in unemploy-ment benefit, labour market policy did not change substantively until 1998,with the reform of the Employment Promotion Act, which had been drawn upby the Kohl Government. The incoming SDP-Green coalition governmentintroduced two waves of rather contradictory activating policy reforms. In theso-called ‘Job Aqtiv’ Act of 2002, the enabling and preventive elements oflabour market policy dominated and support for women seeking to enter thelabour market was increased. The Hartz reforms, which came into forcebetween 2003 and 2005 in four successive waves of legislation (Hartz I–IV),have partly withdrawn these measures, facilitated flexible forms of employ-ment such as marginal part time contracts (so-called ‘mini-jobs’) and – mostimportantly – cut benefits for the long-term unemployed. So far, persistentmass unemployment has not been reduced, with the unemployment rateremaining at nearly 10 per cent throughout 2005 (OECD 2005a).

Workfare policies

Cuts in unemployment benefit and enforced labour market activation. Benefitcuts and new forms of (mandatory) labour market activation can be identifiedas a general characteristic of labour market reform in all three countries (forthe following, see Table 1). Benefit levels and duration, however, varied widelybefore the reforms and still do so afterwards. Furthermore, the procedures, thelevel of compulsion, as well as the options in respect of labour market activa-tion, are still regulated differently.

Activation policies in Denmark left the compensation rate of unemploy-ment benefit unchanged at a rather high level, but in combination with a ratherlow income ceiling it works as a quasi flat-rate benefit.2 However, between1994 and 1999, the duration of unemployment benefit was cut in steps fromeight to four years. Although an ‘active strand’ in Danish social and labourmarket policy had been evident since the 1970s at least, mandatory labourmarket activation for welfare recipients was not introduced until the 1990s(Rosdahl & Weise 2000). The period of entitlement to unemployment benefit



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830 irene dingeldey


begins with a so-called ‘benefit period’, during which opportunities for takingpart in active labour market programmes are offered. Since the most recentreform, any ‘reasonable’ job must be accepted from the first day of unemploy-ment, regardless of previous occupation. Tightened geographic mobilityrequirements include the acceptance of up to four hours’ travel each day,although the implementation of this rule may not be very strict. If after oneyear of unemployment (six months for those under 30) no job has been found,a so-called ‘activation period’ starts, during which the unemployed worker hasthe right and duty to take part in education or training. This is followed up bya new activating programme whenever a person is ‘out of touch with the labourmarket’ for more than six months (Andersen 2002: 70ff; OECD 2003: 182ff).Thus mandatory activation has been introduced into Denmark’s universalwelfare state, although many options are available to programme participants.The unemployment system continues to be generous both in terms of durationand level of benefits.

In the United Kingdom,a major reform of unemployment benefit took placein 1996 when the systems of contributory unemployment benefit and non-contributory income support for unemployed claimants were replaced by thejobseekers’ allowance (JSA), offering a flat rate allowance to all unemployed.This retains a contributory component,which is exempted from means testing inthe first six months. The majority of the unemployed (about 85 per cent) claimthe means-tested allowance (Clasen & Clegg 2003;Trickey &Walker 2000:189).This has gone hand in hand with a decline in net replacement rates to less than50 per cent of former income,3 offering a comparatively low level of socialprotection. Furthermore, in line with a longstanding British tradition of work-fare (King 1995), the introduction of the JSA was combined with a strengthen-ing of activity testing and an increase in sanctions, surveillance and control,particularly for the young unemployed (Trickey & Walker 2000: 188).

Leaving the unemployment benefit unchanged, New Labour instead con-centrated its policy on assisting people to find jobs, making participation in theNew Deal mandatory for certain target groups. The New Deal programmestarts with a so-called ‘gateway period’ (at most four months for the youngunemployed), during which intensive help and support for job search isoffered. During the subsequent intensive activity period, different activationoptions are offered for different target groups. For the NDYU group, theseinclude subsidised employment, participation in an environmental task force,work in the voluntary sector or up to twelve months’ free training. Participa-tion in the New Deal is mandatory for the young unemployed after six monthsof unemployment and for those older than 25 after 18 months. Since 2002participation has also been mandatory for the partners of the unemployed(under 45 years, no children). Lone parents, on the other hand, have only to



attend compulsory work-focused interviews; participation in programmes isstill voluntary for this group, as it is for older workers and disabled people(OECD 2002c: 60). The low level of social protection for the unemployedmeans that exposure to market pressures must be regarded as much strongerin the United Kingdom than in Denmark or Germany. Nevertheless, theBritish have not adopted a pure workfare approach as mandatory work pro-grammes include various options and particular groups, including (lone)mothers with dependent children, are still exempted.

In Germany a first wave of benefit cuts took place in 1993, before a properactivation policy was introduced. Since then, the legally defined rates of unem-ployment benefit have remained unchanged for the first year of unemploy-ment at 60 per cent for singles and 67 per cent for recipients with dependants.4

Until 2005, the long-term unemployed (over 1 year) on means-tested unem-ployment assistance (UA) received 53 per cent or 57 per cent, respectively, offormer wages (legally defined rates). Since then, UA and social assistance (SA)have been merged to form unemployment benefit II, which is designed as aflat-rate payment and fixed close to the level of the lower benefit, offering €345per month in the West and €331 in the East, plus supplements for childrenand/or adult dependants as well as for housing costs.As the means testing ruleshave also been tightened, it is estimated that all former UA recipients whopreviously had rather high earnings and still have significant savings or aworking partner face reductions in entitlement or even losing it altogether; onthe other hand, former SA recipients, particularly lone parents, will be slightlybetter off and have access to the federal activation programmes (Koch &Walwei 2005). The right to seek work only in the occupation for which onetrained has also been abolished in Germany. Requirements for regional mobil-ity have been tightened and sanctions increased if the unemployed refuseemployment offers or participation in employment measures. Germany hasnot introduced a strict timetable for mandatory activation or clearly definedactivation options, but UB II recipients are obliged to take up any job, even ifthe wage is below local or collectively agreed rates (Bruttel & Sol 2006). Theycan be required to take on work that is in the general public interest, continu-ing the tradition whereby recipients of SA have always been legally requiredto work for their benefit. The so-called ‘One-Euro-Jobs’ do not create properemployment relationships, but just provide benefit recipients with an addi-tional compensation of 1 or 2 euros per hour (Koch & Walwei 2005). Thusreforms in Germany have led towards a two-tier system. For recipients ofunemployment benefit, an intermediate level of social protection has beenmaintained without introducing mandatory activation; the long-term unem-ployed, however, face a severe reduction in social protection and can besubject to pure workfare.

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Compulsion through individual contracts? The introduction of individualaction plans in Denmark, the jobseeker’s agreement and individual actionplans in the United Kingdom and the integration agreement in Germanycrystallise more than any other instruments the new relationship between thewelfare state and the individual. The contract between the public employmentservice, in the shape of a personal adviser, and the individual client makes theconditionality of social rights explicit, demanding at best a kind of reciprocitybetween state and individual activity and at worst pure obedience on the partof the individual. One of the crucial points is, therefore, the balancing ofunemployed workers’ wishes, on the one hand, and the demands of the state orthe market, on the other.

In the case of Denmark, evaluation studies suggest that the introduction ofindividual action plans in 1994, which must be set up no later than the time atwhich the unemployed receive their first offer of activation, has led to anincrease in interviews in the employment offices (150,000 more per year thanprior to the reform), although the unemployed are still required to attend onlyonce every three months. Furthermore, it is emphasised that the compulsoryaspects of the system are not dominant; the focus, rather, is on the core valuesof Nordic social and labour market policy – namely the treatment of ‘thecitizen/user/client as an individual human being in his/her own right’ (Olesen2001: 104ff, 134).

The efforts of the unemployed in the United Kingdom have been moni-tored fortnightly by officials who since 1996 have received new discretionarypowers enabling them to issue a jobseeker’s direction requiring individuals tolook for jobs in a particular way and to take certain steps to ‘improve theiremployability’ (Trickey & Walker 2000: 188). Since the New Deal, individualaction plans also have to be agreed on entry into the gateway period. Non-compliance or failure to take up job offers is punished by benefit withdrawal.Although many programme advisers do not police benefit rules in strict accor-dance with the regulations, many of them believe that the fear of sanctionsmotivates clients to attend client interviews and support service and trainingprovision (Joyce & Pettigrew 2002). The target set for September 2002 (40 percent of participants finding unsubsidised employment during the gatewayperiod) was almost achieved and it is generally assumed that these practicescontributed to this success (Clasen & Clegg 2003).

In Germany, since 1998, an integration agreement is signed by every unem-ployed person in order to document his or her commitment to job-seekingactivities. No implementation studies have been conducted to date, but labourmarket experts assume that here the assignment is a rather formal act thatdoes not play an important role in the relation between public employmentservice and individual.



The strength of workfare policies in comparison. Regarding all the indicatorsconcerning level, access and duration of unemployment compensation andthe degree of obligation concerning activation measures summarised inTable 1, workfare policies have increased in all three countries. Nevertheless,the strength of workfare can be regarded as weakest in Denmark. Here thehighest level of decommodification (level and duration of benefit) is main-tained and combined with mandatory activation after one year of unemploy-ment, which includes many options. In Germany, for the short-termunemployed the consequences of workfare policies were limited to increasedwork requirements and a loss of occupational protection, as they still receiverather high income related benefits. In contrast, the strength of workfarepolicies has increased substantially for the long-term unemployed becausethey receive only minimum income support and – although this is not imple-mented on a general level – may be obliged to work (mainly) for benefitwithout being offered other options. Finally, in the United Kingdom thestrong workfare accent is due over all to the low level of benefits as theactivation period and the respective options are defined similar to the regu-lation in Denmark.

Enabling Policies

Activation via job placement. In order to improve the quality of placementprocesses, placement services in all three countries have been reorganised andprivatised in differing ways and to differing extents. Plans to merge unemploy-ment benefit agencies and the employment service and to create local jobcentres with a view to establishing ‘one-stop shops’ offering the full range ofservices to all unemployed people are at different stages of implementation(Dingeldey 2007; Knuth et al. 2004).

In the United Kingdom, the merger of the employment service and theBenefits Agency to form Jobcentre Plus was started in 2001 and wasexpected to be completed across the whole of the United Kingdom by 2006.Furthermore, New Labour introduced public tendering for placement ser-vices for the long-term unemployed in the EZs. Bids from a newly createdpublic-private agency, Working Links, were accepted in most of the zones(Finn 2005).

In Germany, similar schemes were rushed through as part of the Hartzreforms, but they are not operating as they should. Recipients of UB I and UBII are still dealt with in different offices, as UB II is administered by 434consortia (Arbeitsgemeinschaften) set up by local offices of the PES andmunicipalities (in 69 cases, the municipal authorities took over the servicecompletely). In 2004, 713,586 jobseekers requested the newly introduced

834 irene dingeldey


placement voucher enabling them to use the services of a private placementagency, but only about 10 per cent of these were actually used. The newlycreated temporary work agencies, the so-called ‘Public Service Agentur’(PSA), which employ and lend out jobseekers, using temporary work as atransition tool, had only 57,755 inflows in 2004. They are not regarded assuccessful because of the so-called ‘lock-in effect’ whereby participation in theprogramme actually extends the period of non-integration into the primarylabour market (Bundesregierung 2006: 103).

In 1990, the public employment services’ monopoly on placement serviceswas abolished in Denmark as well in order to give ‘other actors’ an opportu-nity. The first tendering round in 2003 led to the conclusion of contracts withprivate enterprises (57 per cent), trade unions (25 per cent) and public insti-tutions (18 per cent). Thus in 2004 an average of about 30 per cent of theunemployed population were referred to ‘other actors’ (the legal obligation isa minimum of 10 per cent). Initial evaluation studies show that the privateservices perform marginally better than the PES in returning the unemployedto work (Bredgaard et al. 2005: 8–9). In conjunction with the 2007 reform oflocal government, there are plans to devolve further responsibilities to themunicipalities, introduce greater marketisation and merge the hitherto sepa-rate services for employment benefit and social assistant recipients and create90 Joint Jobcentres.

The effects of these reforms in terms of improving service quality cannot beestimated clearly. Spending ratios in the different countries seem to be ratherstable, indicating that Denmark has the lowest and Germany the highestspending rates as a share of gross domestic product (GDP) for public employ-ment services and administration (Table 2). In contrast, the ratio of adviser/clients5 suggests that the quality of placement services in Germany may bemuch worse than in the United Kingdom, both before and after the reform. Forthe United Kingdom, the average caseload of counsellors in 1999 was about 40(Konle-Seidl & Walwei 2001), whereas more recently in the ES one casemanager had to deal with between 45 and 60 clients and in the private agenciesin the EZs the average caseload was between 45 and 80 clients (Joyce &Pettigrew 2002). Most recent evaluation studies in Germany suggest that theaverage caseload of a German placement officer was 575 in 2002 and hasdecreased only slightly to 546 in 2005. Nevertheless, the quality of privateplacement services is not supposed to be any better than that of public ones(Bundesregierung 2006: 54, 124ff).

Training programmes as part of activation policies. With respect to the devel-opment of training, we find divergent trends. Neither Denmark nor the UnitedKingdom developed training instruments as part of active labour market



Tabl

e2.

Spen

ding

ondi

ffer

ent

labo

urm

arke

tsc

hem

esan

dac

tiva

tion

rati

oof

labo

urm

arke

tpo

licy

inD

enm

ark,

the

Uni

ted

Kin

gdom

and

Ger

man

yas

perc

enta

geof

GD

Pan

dpa

rtic

ipan

tin

flow

sas

perc

enta

geof

labo

urfo

rce

Den

mar

kU

nite

dK

ingd

omG

erm

any

Spen

ding

aspe

rcen

tage

ofG

DP

Par

tici

pant

inflo

was

perc

enta

geof

LF

Spen

ding

aspe

rcen

tage

ofG

DP

Par

tici

pant

inflo

was

perc

enta

geof

LF

Spen

ding

aspe

rcen

tage

ofG

DP

Par

tici

pant

inflo

was

perc

enta

geof

LF

1997

2000

1997

2000

1997

–19

9820

00–

2001

2002

–20

0319

97–

1998

2000

–20

0120

02–

2003

1997

2000

2002

1997

2000

2002

Pub

licem

ploy

men

tse

rvic

esan

dad

min

istr

atio

n

0.12

0.12

N/A

N/A

0.16

0.13

0.17

N/A

N/A

N/A

0.21

0.23

0.23

N/A

N/A

N/A

Lab

our

mar

ket

trai

ning

0.93

0.86

18.4

715

.90

0.07

0.04

0.02

0.86

0.51

N/A

0.35

0.34

0.32

1.30

1.55

1.24

Une

mpl

oyed

0.64

0.67

8.82

5.76

0.06

0.04

0.01

0.81

0.45

0.26

0.35

0.34

0.32

1.30

1.55

1.24

Em

ploy

ed0.

280.

199.

6510

.15

0.01

0.01

0.01

–0.

06N

/A–

––

––

–Su

ppor

tof

appr

enti

cesh

ipan

dge

nera

lyo

uth

trai

ning

––

––

0.12

0.11

0.10

1.13

1.06

1.01

0.01

0.01

0.02

0.28

0.21

0.27

Act

ive

LM

Pa

1.66

1.58

23.3

721

.13

0.39

0.37

0.37

4.61

N/A

N/A

1.23

1.23

1.18

3.47

4.01

3.60

Pas

sive

LM

Pb

3.83

3.04

25.4

820

.59

0.80

0.44

0.37

11.2

99.

619.

812.

531.

902.

13N

/AN

/AN

/ATo

talc

5.49

4.63

48.8

641

.72

1.18

0.81

0.75

15.9

1N

/AN

/A3.

763.

133.

31N

/AN

/AN

/A

Not

es:

–=

Nil

orle

ssth

anha

lfof

the

last

digi

t.N

/A=

Dat

ano

tav

aila

ble.

aIn

clud

ing

also

othe

ryo

uth

mea

sure

s,su

bsid

ised

empl

oym

ent

and

mea

sure

sfo

rth

edi

sabl

ed;

bIn

clud

ing

earl

yre

tire

men

tan

dun

empl

oym

ent

com

pens

atio

n;c

Incl

udin

gal

soot

her

yout

hm

easu

res,

subs

idis

edem

ploy

men

t,m

easu

res

for

the

disa

bled

and

earl

yre

tire

men

t.So

urce

s:O

EC

D(2

001)

for

the

year

1997

;OE

CD

(200

4)fo

rth

eye

ars

2000

and

2002

.

836 irene dingeldey


policy during the 1970s, but they have increased training efforts as part of theiractivating policies. In contrast, there has been a cutback in long-term voca-tional training in Germany, although it has been institutionalised since 1969and used extensively during reunification.

A particularity of the Danish labour market reform was that between1994 and 2001 the so-called ‘job-rotation programmes’ offered people inemployment training leave of up to one year in order to create employmentopportunities for unemployed substitutes (other options were sabbatical orparental leave). The training option was also open to the unemployed(Compston & Madsen 2001). At the programme’s peak in 1995, more than9,731 employed and 29,706 unemployed people were on training leave. Sincethen, increasing demand for labour has led to the whole programme beingphased out. Nevertheless, education and training, particularly for the unem-ployed, continues to be supported; since 1995, 10,000–37,000 unemployedpeople have taken part each year in courses supplementing secondary edu-cation. In 2001, an apprenticeship programme for adults was introduced, withat least 5,000 participants per year. Additionally some short-term labourmarket training programmes have helped to intensify job search during theactivation period, and counselling or language courses are offered to migrantworkers (see Table 3). In sum, despite the reductions caused by a reshufflingof the programme structure and a decline in unemployed participants, spend-ing remains exceptionally high at 0.86 per cent of GDP in 2000 (see Table 2)and clearly reflects the importance attached to labour market training inDenmark.

In the United Kingdom, the various New Deal programmes offer trainingas an option after the gateway period. Half of the young unemployed choosethe training option, but there is no information on the quality of the particu-lar programmes applied. Of the long-term unemployed aged 25 and over, it isknown that only a few take part in one-year programmes such as Educationand Training Opportunities (ETO), which lead to a recognised vocationalqualification. The majority opt for much shorter programmes designed toimprove basic skills (BET) and update work-related skills (LOT) and job-search skills (SJFT) (Sommerville & Brace 2004) (see Table 4). A similarpattern is likely to be observed in the case of lone parents. In addition to thecomparatively low expenditure on labour market training (0.02 per cent ofGDP) and apprenticeships (0.10) in 2002–2003 (Table 2), it can be assumedthat training and skill enhancement is still rather underdeveloped in theUnited Kingdom. This will not be changed easily, although in 2005 the gov-ernment did launch the New Deal for Skills, which seeks to help youngpeople between 16–19 years of age in particular to reach at least NVQ Level2 (HM Treasury/DWP/DES 2004).



Tabl

e3.

Num

ber

ofpa

rtic

ipan

ts*

injo

bro

tati

on,t

rain

ing

and

coun

selli

ngsc

hem

esin

Den

mar

k

1995

1996

1997

1998

1999

2000

2001

2002

2003

Sabb

atic

al(e

mpl

oyed

)3,

703

790

505

450

00

00

0

Par

enta

llea

ve(u

nem

ploy

ed)

17,5

5013

,054

7,93

77,

456

6,70

16,

082

6,72

04,

306

1,46

2

Par

enta

llea

ve(e

mpl

oyed

)16

,304

14,1

3510

,904

11,3

8012

,637

12,3

5111

,874

6,08

71,

745

Trai

ning

leav

e(u

nem

ploy

ed)

29,7

0617

,142

15,2

4415

,062

984

140

00

Trai

ning

leav

e(e

mpl

oyed

)9,

731

10,6

4310

,294

9,67

59,

733

7,75

91,

207

262

Supp

ort

ofge

nera

lsec

onda

ryed

ucat

iona

1,14

21,

122

886

910

839

635

260

180

109

Supp

ort

ofge

nera

lsec

onda

ryed

ucat

ionb

10,0

1020

,546

15,8

2122

,750

37,5

2128

,653

33,4

1624

,566

16,2

21

Spec

ialt

rain

ing

atre

ques

tof

empl

oyer

(une

mpl

oym

ent

bene

fit)c

1,20

683

642

059

91,

020

7867

062

1

Spec

ialt

rain

ing

atre

ques

tof

empl

oyer

(cas

hbe

nefit

)5,

200

5,10

75,

956

6,04

05,

253

5,05

54,

229

4,28

33,

967

Adu

ltan

dfu

rthe

red

ucat

iond

046

107

164

164

154

102

102

42

Inte

nsiv

ejo

bse

arch

e0

00

00

00

3,34

219

Spec

ialp

lace

men

tf0

00

00

00

392

0

Lan

guag

eco

urse

s0

00

00

1,60

53,

497

3,89

43,

018

Spec

iall

angu

age

cour

ses

00

00

011

521

920

818

7

Spec

ialc

ouns

ellin

gfo

rm

igra

nts

3,14

43,

186

4,10

34,

539

5,91

67,

201

8,11

89,

255

11,9

12

Shor

t-te

rmco

unse

lling

g0

00

255

1,18

71,

010

1,16

02,

549

3,62

2

Adu

ltap

pren

tice

ship

h0

00

00

07,

049

6,27

75,

891

Not

es:

*A

ctua

lpa

rtic

ipan

ts(f

ull-

tim

eeq

uiva

lent

s)in

the

seco

ndqu

arte

rof

the

year

.aU

ddan

nels

em

edvo

ksen

udda

nnel

sess

tøtt

e;b

Ord

inæ

rtud

dann

else

med

udda

nnel

sesg

odtg

ørel

se(o

nly

for

unem

ploy

men

tben

efitr

ecip

ient

s);c

Særl

ige

udda

nnel

sesf

orlø

b;d

Vok

sen-

ogef

teru

ddan

nels

e;e

Inte

nsiv

jobs

øgni

ng;f

Ssæ

rlig

form

idlin

g;g

Kor

tvar

igve

jledn

ing/

Intr

oduk

tion

;hV

okse

nlæ

rlin

g(V

EU

D).

Sour

ce:

Stat

isti

kban

ken

Dan

mar

k(2

005)

.

838 irene dingeldey


Table 4. Activation and training through New Deal programmes in the United Kingdomsince 1998

NDYPNDLTU/ND25+

(since 2001) NDLP

Total participants (starts)since beginning

1,254,100 769,840 769,360

Participants (stock)a in

1998 133,080 47,070 13,050

1999 127,390 80,220 51,620

2000 103,220 63,070 60,680

2001 89,660 64,710 59,290

2002 87,410 67,610 77,450

2003 85,540 57,680 85,580

2004 67,820 51,970 70,570

Options chosen 1998–2001 1998–2004

Training 97,300 (41%) 7,900 (ETO) 25,000c 47,240b

Full-Time Employment 45,700 (19%)

Voluntary Sector 48,800 (21%) – –

Environment Task Force 46,100 (19%) – –

Options chosen (stock) 2004 (September)

Training 6,680 (47%) 640 (7%) (ETO)

1,920 (20%) (IAP Training)

2,550 (27%) (BET/BS)

Full-time employment 2,410 (17%) 2,670 (28%) (workexperience/placement)

1,660 (18%)(self-employment)

Voluntary sector 2,950 (21%) –

Environment task force 2,070 (15%) –

Notes: NDYP = New Deal for Young People; NDLP = New Deal for Lone Parents;NDLTU = New Deal for the Long Term Unemployed; ND + 25 = New Deal for the Un-employed >25 years; ETO = Education and Training Opportunity; BET/BS = BasicEmployment/Basic Skills Training; IAP = Either shorter job-focused training or longer voca-tional training. a Participants in December of the year in question; numbers do not sum tototal participants starting as these refer to all ‘starts’ for the programme in question. b Cu-mulative figures include all lone parents who have taken up (starts) education/training.Opportunities include work-based learning for adults (WBLA) and NDLP supported train-ing; c Work-based learning for adults (WBLA)/TFW.Sources: DES (2005a, 2005b); National Statistics (2001b); Centre for Economic and SocialInclusion (2005).



In Germany, further vocational training was used extensively duringreunification, so that its decline in recent years has partly to be viewedagainst that background. Nevertheless, a new approach was introduced in2003 with Hartz I + II. General guidelines suggest that only those schemesthat promise employment opportunities for at least 70 per cent of all partici-pants in the six months following participation should be subsidised. Regu-lations governing the duration of benefit rights, the level of payment and theeligibility of target groups with respect to participation in training schemeshave been made more restrictive (Kühnlein & Klein 2003). In line with thesedevelopments, there has been an increase in short-term schemes such aslabour market training (assessment, general facilities for applications) andprogrammes targeted primarily at the young unemployed (preparation forvocational training and vocational training). The number of participants inhigh-quality programmes such as further vocational training decreasedrapidly from more than 720,000 in 1993 to 250,000 in 2003 (Table 5). Thus inGermany, the introduction of an activating LMP has gone hand in hand witha decline in training provision and raises the question of whether spending onlabour market training (Table 2) will be maintained even at a moderate levelin future.

The coordination of family policy. In order to increase the employabilityof women with children, the coordination of labour market and familypolicy, particularly the provision of childcare facilities, has been addressedin all three countries. The emphasis on activating this particular groupseems to be greatest in Denmark, and it is here too that the greatestrange of measures has been introduced. In the United Kingdom, anyincrease in participation rates among women with children has been mostlyon a part-time basis. This may also be true for the marginal improvements ofactivation in Germany.

In the universal welfare state of Denmark, both labour market andfamily policy have been guided by the individual adult worker modelsince the end of the 1960s. Thus the introduction of an extended period ofparental leave as one option in the job-rotation schemes (Compston &Madsen 2001) should not be interpreted as a disemployment strategy forwomen with children (Meyers et al. 1999), but rather as a transitionallabour market strategy (Schmid & Gazier 2002) designed to meet childcareneeds within the family while reintegration into the labour market is guar-anteed.6 Accordingly, 85 per cent of mothers stay at home for only sixmonths after childbirth (Wehner & Abrahamson 2003: 26ff). This is possiblebecause, as part of activating LMP, childcare facilities have been expanded,with the coverage rate for all age groups rising from 38.1 per cent in 1990 to

840 irene dingeldey


Tabl

e5.

Num

ber

ofpa

rtic

ipan

ts*

inla

bour

mar

ket

trai

ning

inG

erm

any

Inst

rum

ents

1993

1994

1995

1996

1997

1998

1999

2000

2001

2002

2003

Lab

our

mar

ket

trai

ning

(Tra

inin

gsm

aßna

hmen

)0

00

016

,444

33,8

1839

,343

47,4

9251

,266

61,9

5077

,887

Fur

ther

voca

tion

altr

aini

ng(B

erufl

iche

Wei

terb

ildun

g)72

2,74

956

3,21

555

2,55

053

7,68

142

4,77

334

4,71

335

8,12

835

1,96

034

4,81

633

1,58

625

0,97

6

Voc

atio

nalt

rain

ing

(För

d.B

eruf

saus

bild

ung)

––

98,7

2310

8,63

411

4,13

110

7,72

311

7,06

412

3,59

612

8,30

113

1,48

013

0,94

6

Pre

para

tion

for

voca

tion

altr

aini

ng(F

örd.

Ber

ufsv

orbe

reit

ung)

––

––

–77

,783

83,2

6889

,234

93,2

8510

6,85

910

8,01

8

Not

e:*

Num

ber

ofpa

rtic

ipan

tsas

year

lyav

erag

e;fu

rthe

rvo

cati

onal

trai

ning

wit

hout

job

intr

oduc

tion

allo

wan

ce.

Sour

ces:

Bun

desa

nsta

ltfü

rA

rbei

t(v

ario

usye

ars

a;va

riou

sye

ars

b;20

01).



59.2 per cent in 2000.7 Furthermore, half-time day-care places have beenconverted into full-time places, while maintaining good quality of care(OECD 2002a: 102, 162). As a consequence of these policies, Denmark hasone of the highest employment rates of women with children within theOECD: 88.1 per cent for women with one child and 77.2 per cent for thosewith two children in 1998. In addition, the proportion of part-time employ-ment among these two groups is still declining (13.3 and 16.2 per cent,respectively) (OECD 2002b: 77).

In the United Kingdom, the New Deal programmes for lone mothers andfor partners of the unemployed, combined with several changes in regulationsand schemes introduced under the general heading of ‘Making Work Pay’,8

were aimed at activation of so-called ‘workless households’. The most impor-tant of these measures were the changes made to what was then the workingfamily tax credit in 1999 and its subsequent reform in 2003 as the working taxcredit (WTC), available to all adults and an additional child tax credit (CTC).The intention of these ‘in-work-benefits’ is to eliminate poverty traps for thoseon benefit and to increase disposable market income by transfers that varyaccording to the number of children to be maintained (HM Treasury 1998). In2003–2004, more than 1.6 million families were claiming WTC and more than5.5 million CTC, spending on which amounted to £14.6 million or 0.4 per centof GDP (HM Treasury 2004), million, or 0.4 per cent of GDP (HM Treasury2004), which exaggerates the spending on active LMP measures. The employ-ment and tax programmes have been combined with the National ChildcareStrategy in order to combat child poverty by integrating parents into thelabour market (Harker 1998). This ended a policy of non-intervention infamily matters that had resulted in fewer than 11 per cent of under-fives havingchildcare places in the 1990s (Rostgard & Fridberg 1998). In 2001 in England,approximately 90 per cent of 3–4 year olds attended nursery schools or recep-tion classes. Day nursery provision and out-of-school clubs have also expandedconsiderably (9.5 and 8.2 places, respectively, per 100 children of the relevantage) (National Statistics 2001a). However, nursery schools and receptionclasses open only a few hours in the morning (Rake 2001), so the provision ofchildcare often does not even cover 16 hours per week, which is the workingtime requirement for the WTC. Thus the harmonisation of employmentschemes and childcare provision works well only for a rather small targetgroup – namely (lone) mothers with school-aged children (Rake 2001). Nev-ertheless, the increase in the activity rate of lone mothers to over 55 per centin 2004 may possibly be related to this policy (HM Treasury 2005). Generallyrising activity rates for women with children in the United Kingdom disguisethe fact that labour market activation in this group is due mostly to shortpart-time work that does not pay a living wage.

842 irene dingeldey


In Germany, policies aimed at boosting labour market participationamong women with children are still modest in scope. The assumptionsunderlying many instruments of family policy, particularly childcare institu-tions, are that the male breadwinner family is the norm and that women withchildren work part-time at most. The tax-splitting system gives high taxreductions to sole breadwinner families, which decrease as the second earn-er’s income rises, thus creating disincentives for married mothers to take up(full-time) employment (Dingeldey 2001). The parental leave regulationallows a period of labour market absence for three years and accordinglychildcare facilities for the under threes hardly exist – particularly in WesternGermany (3.6 per cent, compared to 14.4 per cent in East Germany in 2000).For the 3–6 age group, the supply is much better (77.2 per cent in the West,85.4 per cent in the East), but only 16.5 per cent (West) and 70.6 per cent(East) of places were full-time in 2000. There were also very few places inafter-school clubs, particularly in the West (2.9 per cent, compared to 15.8 percent in East Germany) (Spiess et al. 2002). One reason why these obstacles tothe employment of women with children have not been conquered effectivelymay be that activation policies in Germany were introduced at a time of highand enduring unemployment, when an increase in women’s labour marketparticipation was thought likely to increase unemployment. Thus for motherson benefit, the general exemption from labour market activation has beenmaintained, as long as the children are under three or do not have access tochildcare. However, an increase of childcare facilities for the under threes inorder to cover the demand of all working parents has been legally promotedsince 2005 (Tagesbetreuungsausbaugesetz). This has led to an increase ofplaces, so that 9.6 per cent of the age group in the West and 39.8 per cent inthe East had places in 2005–2006 (Bundesministerium für Familie, Senioren,Frauen und Jugend 2006).

Furthermore, the federal government’s scheme to co-finance more full-time schools as a response to Germany’s low ranking in the PISA Study(Gottschall & Hagemann 2002) may have the side effect of positively influ-encing the employability of women with dependent children. Nevertheless, thebiggest effect on the labour market behaviour of women with children may beproduced by the newly regulated mini and midi jobs, which create a precarious(part-time) labour market that is particularly attractive for married womenwith children (Koch & Bäcker 2004).Thus the moderate employment rates forwomen with one child (70.4 per cent) and the particularly low rates for womenwith two or more children (56.3 per cent) are expected to rise significantly.However, most of this rise will take the form of part-time employment – therates of which were already high in 2000 (45.3 and 60.2 per cent, respectively)(OECD 2002b: 77–78).



The strength of enabling policies in comparison. Taking into account the evo-lution of the number of participants in training programmes, estimates of theirquality and duration and the development of childcare facilities, it is Denmarkthat has the most comprehensive set of enabling policies. The UnitedKingdom, with the improvement of placement services, the increasing numberof participants in employment programmes and the expansion of childcarefacilities, has made a major effort to put in place a more enabling approach.However, the quality and extent of its enabling policies do not come close tothe levels achieved in Denmark. For Germany, again the results are mixed.Although the quality of training programmes was better, the number of par-ticipants higher and childcare facilities more developed than in the UnitedKingdom before activating LMP started, the number of participants has sincedecreased rapidly and the supply of childcare places has risen only slowly. Insum, enabling policies as part of activating LMP may be characterised as ratherweak in Germany.

Different mixes of workfare and enabling policies: Different paths towelfare state transformation

The evidence on LMP reforms outlined above confirms the thesis that we arefacing a paradigm shift in welfare state development. Ideas about the need fora new balance of ‘rights and responsibilities’ between the welfare state andbenefit claimants have led to the establishment of an activating approach tolabour market policy in quite different welfare states. However, the evolvingmix of workfare and enabling elements varies widely, leading to very differentlevels of decommodification and (re-)commodification in the different welfarestate types. Against this background, the question of whether recent welfarestate reforms can best be characterised as moves towards workfare or towardsthe enabling state can be answered only with reference to developments inparticular countries.

Measuring the relative strength of workfare and enabling policies seems toprovide a good basis for characterising the various national paths towards thetransformation of labour market policy. Evaluating the results rather sche-matically – without claiming to quantify precisely the extent of change – itbecomes obvious that in both dimensions a move in the same direction istaking place, but without producing a convergence of policy mixes in thevarious countries (see Figure 1). Both in Denmark and the United Kingdom,the workfare and enabling elements of labour market policy have increased,but the relative difference in welfare policies in the two countries has beenmaintained. Denmark combines a still rather weak workfare approach with

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strong enabling elements, whereas in the United Kingdom strong workfareelements are combined with still rather weak enabling policies. Germanyseems to be the exception in this regard because the workfare elements havebecome stronger, while the enabling elements, some of which were strong, arein decline. Although it retains its intermediate position, Germany seems to bemoving towards the neo-liberal model. Whether this trend will be reversed orconsolidated is as yet unclear, but will have to be considered in the light offorthcoming reforms.

The results presented are not readily applicable to the development of thewelfare state as a whole since other indicators need to be developed for theanalysis of other areas such as pensions or health policy. Nevertheless, ouranalysis suggests that, over and above the similarities produced by a shifttowards a new welfare state paradigm, differences of policy mixes will persist.Although individual countries may change their policy alignment, welfarestate policies do not seem to be converging.

Notes

1. This aspect is reflected in the European Union’s target of raising female participationrates to 70 per cent (Aust 2000).

2. In 1999, the standardised OECD replacement rates for average production worker(APW) income (two-thirds of APW-level income) was 63 (89) per cent of former incomefor singles and 73 (83) per cent for a couple with two children (OECD 2005b: 30).

3. The standardised OECD replacement rates for APW-level income (two-thirds of APWincome) was 46 (66) for singles and 49 (54) per cent of former income for a couple withtwo children in 1999 (OECD 2002d: 30).

Workfare policies

strong UK UK G G DK DK weak

<_______________________________>

Enabling policies

weak UK UK G G DK DK strong

<_______________________________>

Figure 1. The relative strengths and weaknesses of workfare policies and enabling policies(normal type = before reform; bold type = after beginning of labour market reform).



4. Due to the standardised OECD replacement rates for average production worker (APW)income (two-thirds of APW-level income), the net replacement rates were 60 (67) ofprevious income for singles in 1999 and 70 (75) per cent for a couple with two children(OECD 2002d: 30)

5. The following data are very broad estimations due to the fact that not all employees in theemployment services (ES) are engaged in counselling, and that some counsellors alsoperform other tasks.

6. Since 2002, the various leave instruments have been combined and total duration reducedby 20 and six weeks, respectively. Maternity and paternity leave have been left unchanged,with both mothers and fathers now having a joint right to 32 weeks of parental leave,which can be taken together or separately (prolongation by 14 weeks without financialcompensation is possible) (Linke Sonderegger 2003).

7. Coverage rates for the respective age groups were 56 per cent (0–2 years), 94 per cent (3–5years) and 81 per cent (6–9 years) in 2002 (Denmark Statistics 2004).

8. To eliminate disincentives to work for married women, the married couples’ allowancewas abolished and a flat-rate child benefit payable to all parents was introduced(Dingeldey 2001).

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