A poverty-proof welfare state for the future

In our contribution to the 2024 Austrian Social Report, we asked ourselves what it means to create a 'poverty-resilient welfare state'. In times of crisis, it is important to reconsider how poverty and those affected by it can be defined and measured. As poverty is multidimensional, we propose a set of indicators to capture its various dimensions. Thresholds must be set for each dimension of poverty as proxies for absolute poverty, and relative poverty measures must be established to capture excessive deviation from the average standard of living.

Once a multidimensional understanding of absolute and relative poverty has been agreed upon, the next step is to consider effective and efficient poverty policy. In this paper, we emphasise poverty prevention as one of the most effective, efficient and sustainable forms of policy. Consequently, we advocate poverty-preventive measures designed to keep people out of poverty. To improve the existing social policy framework, we propose implementing guaranteed social rights, including minimum income and minimum security, to prevent absolute poverty. If poverty prevention still is unsuccessful, there is a strong case for a needs-based, targeted approach to poverty policy. This is because, although the structural causes of poverty have been well researched, individual experiences of poverty are highly variable and require tailored solutions. There are already well-functioning examples of this approach, such as early intervention programmes, which we believe should be expanded and extended.

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