Crisis and Croatian Welfare State: A New Opportunity for Welfare State Retrenchment?

The chapter starts with a short overview of recent socio-demographic and socio-economic trends and how they challenge the Croatian welfare state, the severity of the crisis and the main crisis-related reforms. The reforms in the main social policy areas (labour market, pensions, healthcare, family policy, social assistance and eldercare) are explored in more detail afterwards, putting an additional focus on arguments behind the reforms and the way the welfare programmes were (re)balanced and (re)orientated in the crisis period.

Many of the challenges the social systems are facing in Croatia have their roots in the pre-crisis period. The high politicization of social issues reflected in inadvisable reforms around elections, as well as ad-hoc, uncoordinated and ill-advised reforms in general brought numerous side-effects resulting in additional difficulties mostly related to financial sustainability, but also an adequacy and efficiency of social systems. Structural difficulties and already existing institutional deficits become thus only additionally aggravated with the crisis putting a new burden on the welfare state, particularly as the crisis progressed and the need for consolidation of public finances grew. The earliest government’s response in the area of welfare state was indeterminate and absent, while further reform efforts were often vague and did not follow a clear anti-crisis strategy. They resulted in inadvisable, ad-hoc reforms predominantly aimed at savings. The reform processes in some areas became closely connected to the “deservingness” discourse, making strong arguments against the welfare state.