Is the Nordic social welfare model fit for the future?
The Nordic model has performed well so far. Now, a new chapter in the history of the model is being written according to current global challenges. Is it sustainable in the long term?
As Nordic citizens, we all know the perks of living in a Nordic country: free and equal access to social services regardless of income or economic need. That privilege does come at a cost – a marginal tax rate that takes about half a resident’s income – but you won’t hear most citizens arguing. They’re funding the public sector and enjoying a relatively generous social safety net that covers a broad array of services.
So far, the Nordic model has been able to achieve growth and substantial equality, and support for the model and the social contract underpinning it seems to be intact. However, our society faces new and – perhaps – bigger challenges than ever before: technical innovation, globalization, aging populations, immigration, off-shoring and global warming top the list.
Is the Nordic social welfare suited to this new reality? And which societal welfare model can best accommodate and adapt to changes? We address these questions – and many more – in our new report ‘The Nordic social welfare model: Lessons for reform’.
With the help of Danish think tank Kraka, Deloitte put the Nordic model under the microscope to see how it has developed and adapted, and to consider if and how the social welfare model can actually sustain itself in the Nordic countries as the world grapples with all the disruptors.
It is our hope that the report can inspire thoughtful reflection through evidence-based analysis, as governments around the world develop solutions to pressing social challenges.