Activation during the pandemic downturn

Mandatory activation conditions for social-assistance recipients should be suspended during the pandemic.

Whether activation policies can foster labour-market integration and, at the same time, protect individuals from poverty is doubtful. Pressing citizens into precarious occupation may lead to in-work poverty or lack of employment rights, while they risk losing their right to a minimum income due to the increasing conditionality of activation.

These concerns are even more compelling amid socio-economic transformations and downturns, such as that caused by the Covid-19 pandemic, when available occupations are scarce and harder to secure, especially for vulnerable groups.

With additional redundancies and rising unemployment, there are fewer jobs to go back to and competition for them may intensify, especially for social-assistance recipients with weaker labour-market histories and health, social and household challenges. In this context, putting pressure on claimants through work conditionality and sanctions, to integrate quickly into the labour market by accepting any job, including ‘workfare’, may not only harm recipients’ wellbeing and income protection but also put wages and working conditions generally under added strain.

It would seem logical to reduce work-related benefit conditionality when unemployment rises, to avoid negative repercussions on citizens and the wider workforce when labour demand is low. Yet in the economic crisis following the 2008 financial collapse, not only did governments not reduce conditionality for social-assistance recipients—some even intensified it.

Enabling support

In a scenario where vulnerable individuals in particular are unable to secure quality, sustainable employment, social and employment services could suspend work-related conditionality and devote their efforts to providing support. Removing the threat of sanction would mean continuing to promote social and labour-market integration through ‘enabling’ services, provided on a consensual basis.

Resources previously devoted to the administration of work-related conditions could be redirected towards personalised support. This would prioritise individuals’ needs, aspirations and wellbeing—including social dimensions such as decent housing, improved health and informal care—and support sustainable labour-market integration in the longer-term, while guaranteeing a minimum income meantime.

Such personalised support could assist training, entry into subsidised/socially-useful work and voluntary activity. Longer-term and sustainable activation strategies, addressing the complex needs of vulnerable individuals, would support them to face societal and labour-market transformations, boost their trust in government and allow them to contribute to society in multiple ways.

Punitive function

Suspending the punitive aspect of mandatory activation is not only a matter of efficiency but, first and foremost, equity. Such obligations rest on two assumptions: that individuals are not willing to work and yet that quality employment is available. When sustainable jobs are few, they merely serve a punitive function.

Going one step further, recent policy experiments (such as the Finnish ‘basic income’ trial) have investigated the implications of removing work-related obligations and sanctions, thus leaving participation in social and employment services voluntary. Findings show that receiving financial support without the pressure of work-related conditions leads recipients to greater wellbeing (sense of autonomy, security, mental health) and more general interpersonal trust, with no negative repercussions on employment.

The current situation lends itself to additional experimentation in this regard. The economic downturn ahead is likely to mean those with limited resources will be unable to bridge it with their own savings and will resort to minimum-income support. An enabling, unconditional activation strategy is possible only with adequate income support and when the scheme covers all those who reside in a country and are in financial need.

Minimum-income schemes have to be strengthened and behavioural conditionality revoked if we want to avoid the risk that a health and economic crisis turns into a social crisis too.