ARE THERE NO WORKHOUSES?

Trouble in geriatric Europe (Emma-Kate Symons, The Australian, April 23rd, 2005)

Despite belated attempts at reform, being in your 50s or 60s in Europe's largest economies is still a saunter in the continental pleasure park. According to Organisation for Economic Co-operation and Development figures, public spending on pensions in France and Germany is among the highest in the OECD, up there with Italy, Greece, Switzerland and Austria, at 11.9 per cent and 11.2 per cent of gross domestic product respectively. In Australia we spend only a modest 4.3 per cent.

After decades spent fudging structural reforms first undertaken in Australia and Britain in the 1980s, unemployment in Old Europe is at record highs. Not since the '30s has Germany endured an unemployment rate of 12 per cent or five million. The French are at 10 per cent.

Such alarming figures could have nothing to do with Germany and France's fading love affair with the 35-hour week and six weeks or more of holidays. As the population ages, who are the hardest hit by the jobs crisis? Younger people, who are battling unemployment levels in the double digits sometimes years after graduation even from elite universities.

OECD social affairs ministers recently met in Paris, including our Workplace Relations Minister Kevin Andrews and Family and Community Services Minister Kay Patterson. Andrews and Patterson laboured to focus discussion on the need for strong economic growth to support good social policy, and partnerships between government, non-government organisations and the private sector in delivering welfare. Yet all some of the Europeans could do was deride a delegate who dared raise the spectre of the ageing-population crunch. Ann Mettler, a Swedish and German citizen who heads the reform-minded Lisbon Council, warned that the European social model, despite its proud history, was an anachronism better suited to the 19th-century industrial age.

"The European social model is increasingly becoming a euphemism for protecting incumbents, people with a job, at the expense of people without a job," Mettler declared to audible snorts from OECD delegates. "And, frankly, it protects baby boomers at the expense of young people. What has this led to? Europe prides itself on being inclusive and social. But look around yourself: we have 19 million unemployed; 18 per cent of them are under the age of 25; we have ballooning and in fact unsustainable budget deficits; and we have deteriorating if not collapsing social security systems. Now add to that a demographic challenge that is awaiting us that is unprecedented.

"Europe has not experienced such a demographic change since the Black Death ravaged our continent."

A privileged generation that has always believed life was about securing its comfort and licensing its appetites can hardly be expected to give up its perks for such nebulous causes as economic growth and job opportunities for immigrants and the young.