Editor in Chief: Moh. Reza Huwaida Wednesday, May 1st, 2024

Nordic Welfare Model

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Nordic Welfare Model

High illiteracy, epidemic diseases and grave poverty are among the chief social problems of Afghanistan. Vast majority of people are suffering at the hands of acute poverty. They have to undertake hard labor all the daylong to make the ends meet. The percentage of the population with access to electricity in Afghanistan is among the lowest in the world. Due to restricted number of public sector educational institutes, health centers, conveniences and opportunities in every walk of life, people are left with only option of distress and uncertainty.

Other problems, riddling Afghan society includes violence, insecurity, corruption, religious fundamentalism and extremism. Any inefficient government plagued by corruption rests worthless unless the privileges are directed to poverty stricken masses, guaranteeing social security, health, education and human rights and a vibrant economic opportunity to grow. This is only possible having aimed at developing welfare state where citizens are bestowed opportunities.

The concept of the welfare state came into prominence mainly after the Second World War with ideals and policies, popular in recent times are followed by a number of countries in the world. In the nineteenth century the state had become a democratic Welfare State in many parts of the world.

The general masses of people suffered seriously on account of increasing poverty, inequality, economic uncertainty, unemployment etc.
The welfare of citizens stands primary objective of a welfare state, making provisions for free medical service, public health and hygiene and preventive measures against epidemics.

It takes care of old, invalid and sick people providing them financial assistance in the form of allowance, pension, relief etc. The unemployed receive unemployment from the state. It is the duty of the welfare state to provide opportunities for education to all its citizens and to make education free and compulsory up to a certain standard. Furthermore the state should establish and maintain a large number of institutions for general and technical education.

In welfare state the government plays a key role in the protection and promotion of the economic and social well-being of its citizens. It is based on the principles of equality of opportunity, equitable distribution of wealth, and public responsibility for those unable to avail themselves of the minimal provisions for a good life.

A Welfare State also implies an efficient administration, speedy justice for the people, a regime totally free from corruption, inefficiency, sloth and the frustrating complexities of red-tape etc. Among the measures which the people of such a State expect is social welfare legislation.

Modern welfare states include the Nordic countries, such as Iceland, Sweden, Norway, Denmark, and Finland which employ a system known as the Nordic model. The welfare state involves a transfer of funds from the state, to the services provided (i.e. healthcare, education) as well as directly to individuals. The welfare state is funded through redistributionist taxation and is often referred to as a type of mixed economy.

The Nordic model refers to the economic and social models of the Nordic countries. This particular adaptation of the mixed economy is characterized by universalist welfare states relative to other developed countries, which are aimed specifically at enhancing individual autonomy, ensuring the universal provision of basic human rights and stabilizing the economy.

The Nordic model is distinguished from other welfare states with similar goals by its emphasis on maximizing labor force participation, promoting gender equality, egalitarian and extensive benefit levels, the large magnitude of wealth redistribution, and liberal use of expansionary fiscal policy.

The Nordic Model however is not a single identical set of policies and rules in every country; each of the Nordic countries has its own economic and social models, sometimes with large differences from its neighbors. The

Nordic countries exercise the following undertakings. An elaborate social safety net in addition to public services such as free education, universal healthcare, strong property rights, contract enforcement, overall ease of doing business, public pension schemes, low barriers to free trade combined with collective risk sharing such as, social programs, labor institutions, providing a form of protection against the risks associated with economic openness and little product market regulation are its main features.

Nordic countries rank very high in product market freedom according to Organization for Economic Co-operation and Development (OECD) rankings. In Transparency International's 2012 Corruption Perceptions Index all five Nordic countries were ranked among the cleanest when it comes to public sector corruption. Such good results stem from political will, open government and robust legislation and mechanisms for holding politicians and civil servants to account.

A partnership between employers, trade unions and the government, whereby these social partners negotiate the terms to regulating the workplace among themselves, rather than the terms being imposed by law. Sweden has decentralized wage co ordination, while Finland is ranked the least flexible. 

The changing economic conditions have given rise to fear among workers as well as resistance by trade unions in regards to reforms. At the same time, reforms and favorable economic development seem to have reduced unemployment, which has traditionally been higher.

Sweden at 56.6% of GDP, Denmark at 51.7%, and Finland at 48.6% reflect very high public spending. One key reason for public spending is the very large number of public employees. These employees work in various fields including education, healthcare, and for the government itself. They often have lifelong job security and make up around a third of the workforce.

The public sector's low productivity growth has been compensated by an increase in the private sector's share of government financed services which has included outsourcing. Public spending in social transfers such as unemployment benefits and early-retirement programs is high.

In 2001, the wage-based unemployment benefits were around 90% of wage in Denmark and 80% in Sweden, compared to 75% in the Netherlands and 60% in Germany. The unemployed were also able to receive benefits several years before reductions, compared to quick benefit reduction in other countries. Public expenditure for health and education is significantly higher in Denmark, Sweden, and Norway in comparison to the OECD average.

Having been through robust qualitative and quantitative distinguishing features of Nordic welfare model, Afghanistan is prescribed to pursue this model of welfare state with public welfare given prime significance, taking a bold and meritorious strategy bearing glorious progression and a development ahead. In that pursuit social welfare legislation turns out to be a preliminary primacy. The assumptions of such prime responsibilities are not exhaustive, they are indicative of the function which the state has to perform for the general well-being of people.

Asmat Yari is permanent writer of Daily outlook Afghanistan. He can be reached at asmatyari@gmail.com

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