On 23 January, the high-level task force on investing in social infrastructure in Europe, chaired by Romano Prodi, published a report that looks at investing in social infrastructure in Europe such as healthcare, education and affordable housing. The report is the result of a one year work of the high-level task force comprised by representatives from the European Long-Term Investors Association, the European Commission, the European Investment Bank, the Council of Europe Development Bank, many National Promotional Banks as well as associations and experts from the social sector.
The conclusion of the report is that the gap in social infrastructure investments is significant and that it has widened since the 2007 financial crisis at all level of government. It shows that local governments were the most affected, with an investment drop of 12% in 2015 compared with pre-2008, while the investment of central governments was down 8.1%. Local governments carry out an average two-thirds of the total public investment within the EU, especially in social infrastructure. In this context the decline is significant and generates a big gap in social infrastructure investment estimated at EUR 100-150 billion per year.
The report calls for the launch and implementation of an ambitious strategy to boost long-term investment in social infrastructure in Europe.Here are some concrete recommendations about what needs to improve:
- develop policies and instruments designed to expand the achievements of the European social welfare state, adapting it to the knowledge economies and to ageing societies in a globalised world;
- incentivise reforms and boost investment in innovations, bringing European innovators and small and medium-sized businesses to the fore;
- build a more efficient partnership between public and private participants in investment, with a key role for long-term investors and NPBIs;
- establish a new asset class and financing instruments that are adapted to needs in the social field.
Read the full report here: http://bit.ly/2Dsr2c2.