E.g., 08/30/2014
E.g., 08/30/2014

Reaping the Benefits? Social Security Coordination for Mobile EU Citizens

Policy Briefs
November 2013

Reaping the Benefits? Social Security Coordination for Mobile EU Citizens

The smooth operation of free movement in the European Union requires that movers neither lose nor gain social benefits as a result of their move. EU social security rules seek to enable people to move between EU countries without losing their benefits, while reducing opportunities to game the system by collecting benefits in multiple locations. However, since Member States have developed different social models as a result of their specific histories, coordinating these diverse national systems into a single set of common social security rules has been tricky.

The current rules—especially on residence-based benefits and on the treatment of EU nationals who constitute a drain on resources—are neither well understood nor well liked, and implementation by Member States has been patchy. Amongst the public, perceptions of unfairness—from granting newcomers benefits to rewarding strategic, benefit-maximising behaviour—abound, jeopardising support both for free movement and for the welfare state. 

This MPI Europe policy brief reviews these challenges, and argues that while improving fairness, clarity, and public support for EU-wide social security is difficult, even small concessions from the European Commission could provide an opportunity to showcase the elements of the system that do work.

Table of Contents 

I.  Introduction

II.  The Social Security Coordination System

III.  Challenges and Controversies

A.  The ‘Benefits Tourism’ Claim

B.  Opportunities for Fraud

C.  A Broken System

D.  Does Intra-EU Mobility Challenge the Welfare State?

IV.  Policy Options

A.  Restricting Access to Benefits

B.  Introducing a Cost Compensation Mechanism

C.  Improving Options for Return

V.  Conclusions