We compare three EU countries that have recently experienced substantial but very different reforms of their systems to support families with children: Austria, Spain and the United Kingdom. The structure of these systems is different: Austria gives emphasis to universal benefits, Spain to tax concessions and the United Kingdom to means-tested benefits. As a first step the paper compares the distributional implications of these three approaches. The recent reforms have reinforced these existing structures while increasing the amount of public resources directed towards children. The second step is to address the question whether the chosen strategies are the best for each country. What would have happened if instead of reinforcing the existing types of policies these countries had completely transformed the architecture of their systems in either of the other two directions? We use EUROMOD, the European tax-benefit microsimulation model that is designed for making cross-country comparisons and answering “what if” questions such as these to explore the effects of budget-neutral alternatives on the position of children in the income distribution as a whole, the proportions gaining and losing and the effects on child poverty. The three factors that can be distinguished – the level of spending, its structure, and the way it impacts in a particular national context – are all important to varying degrees.
Children European Union Policy reform Microsimulation