The latest Eurostat study, released on November 27, 2012, shows a significant rise in social protection spending in the European Union between 2007 and 2010. In 2010, the 27 EU Member States allotted 29.4% of their GDP to social security benefits, compared to 26.1% in 2007. This increase is largely a consequence of the economic crisis.

An upward trend and heightened inequality

The increase in social protection spending as noted by Eurostat nevertheless reveals marked inequality among Member States, each endowed with individual systems featuring their share of idiosyncrasies, and each facing distinct social and healthcare realities. The countries devoting the largest percentage of their GDP to such spending items are France (33.8%), Denmark (33.3%) and the Netherlands (32.1%). The smallest percentages are found in the newest European Union Member States; Romania and Bulgaria devote a mere 18% of GDP to social security benefits.  

Pensions: number one spending item

Retirement pensions accounted for 45% of social security benefits in 2010, making this budget the number one spending item in nearly all Member States. Italy and Poland featured the highest percentages, both devoting 61% of their social security budgets to pensions. Denmark (38%), Luxembourg (36%) and Ireland (23%) brought up the rear.

The second largest spending item concerned illness, healthcare and disability benefits. The average percentage among the 27 was 37% of social security benefits, with Ireland (48%) coming in first.

Eurostat concludes its study by forecasting a continued rise in social protection spending in the European Union, primarily due to worsening unemployment between 2011 and 2012.