A Child Guarantee can be a second launchpad for investing in children.

The ‘economy of wellbeing’ is a bright new narrative which the Finnish EU presidency is championing, to frame the interplay between economic and social policies. It is refreshing to see such a shift in understanding of the economy, with government officials contending that ‘investing in well-being makes sense in economic terms even in times of economic downturn’. Will children across Europe benefit from this shift?

We cannot break the cycle of disadvantage without addressing the daily realities of children growing up in poverty. Well-being and social inclusion are two sides of the same coin. Research confirms that spending on childhood and on family-support policies and services reaps benefits for society in the long-term. If families in need are supported, then inequalities—such as in malnutrition and school dropout rates—can be pre-emptively reduced in early childhood.

The Organization for Economic Co-operation and Development argues that the four most important components of the economy of wellbeing are health, education, social protection and gender equality. Certainly, children are directly affected by policies in all these domains.

Expenditure as investment

This rethinking of expenditure as investment was spurred on by the European Commission’s 2013 ‘Recommendation on Investing in Children’, aimed at guiding national strategies to reduce child poverty. Despite the commitment to move ahead on children’s wellbeing, however, progress has been meagre. Few EU countries have comprehensive strategies for reducing child poverty and the amount of EU resources spent on this priority is not tracked.

Identifying the scale of the problem is not the issue. The EU has a broad ‘at risk of poverty or social exclusion’ indicator, divided by age groups. This now has a companion to assess children’s material deprivation based on lack of child-specific ‘items’, such as ability to go on school trips or have a space to do homework.

This is a good first step—if only it were used to nudge member states to take this on as a political priority. The Child Guarantee—an initiative put forward by the European Parliament to support the most disadvantaged children through the EU’s social fund—might do just that. Without national strategies to tackle child poverty, however, it will only be a drop in the ocean.

Umbrella strategy

A high-level event in Finland in mid-September sought to do more than create a buzz around a concept. It was an attempt to reshape the work of the incoming European Commission on the next umbrella strategy steering macroeconomic co-ordination for the coming decade.

The Europe 2020 strategy expires soon and its targets, one of which is to lift at least 20 million people out of poverty, have lost traction along the way. The new social framework of the European Pillar of Social Rights, collectively supported by EU leaders and institutions in 2017, is assumed to guide the social dimension of the union. The next commission in fact promises to come up with an action plan to realise the pillar.

The European Semester—the EU framework to monitor national policies on a range of issues from social to fiscal measures—will remain the instrument to encourage policies prioritising wellbeing to achieve sustainable economic growth and stability. The UN Sustainable Development Goals will in turn be important for steering the overall direction for the next ten years.

Social returns

Days before the Finnish EU conference, social NGOs met decision-makers to share their perspectives. Eurochild underlined the social and economic returns of investing in the prevention and reduction of child poverty. It expressed hope that the incoming European Commission would take a more prominent stand, given the commitment by the president-elect, Ursula von der Leyen, to introduce a European Child Guarantee.

During the two-day event, prioritising children in the economy of wellbeing was supported by not only the Finnish but also the future Croatian EU presidency, as by the commission and the Fundamental Rights Agency. More national political ownership and action are needed to improve children’s wellbeing. With a boost to the Investing in Children framework, along with EU financial support to address child poverty through the Child Guarantee, we have a greater chance to improve the lives of the nearly 24 million children living in poverty across the union.

The growing recognition of social wellbeing in economic decision-making is positive. Next year, Eurochild’s flagship conference will be hosted in Finland by the Central Union for Child Welfare, where decision-makers, civil society actors and children themselves will gather to discover Finland’s child policies. Perhaps the Finnish EU presidency can leave a lasting impact on a Europe 2030 strategy that foresees an economy working for people—not vice versa.