Democratic Institutions and Public Administrations of Europe: Cohesion and Innovation in the time of Economic Crisis
The Impact of the Financial-Economic Crisis on the Guarantee of Welfare Rights
General coordinator: Prof. Francesco Merloni, University of Perugia
Coordinator of the research unit: Prof. Stefano Civitarese Matteucci, University of Chieti-Pescara
Outline of the Overall Research Project
Several European countries, including Italy, are facing the necessity of budget recovering policies (deficit control and stock debt reduction), which question the consolidated forms of public organization and action of the democratic institutions and administrations, at the various levels of government. The more recent economic and financial crisis has accelerated and profoundly changed the European policies towards the member States, shifting from a wide national political discretion about their own economic and fiscal policies (public utilities, social policies, income distribution, institutional organization) only externally limited by budgetary restrictions, to a larger European action in order to determine the content of economic policies, of institutional reforms, of juridical tools of public action. The proposed research will provide a systematic survey on the impact of the crisis on democratic institutions and administrations, in order to have a complete knowledge of anti-crisis legislation, adopted at international, European and national level to face financial crisis situations. The research is based on the idea that the crisis impact requires an increasing public government capacity, not a reduction in public action and in the variety of juridical tools at public authorities’ disposal. There are three basic modes of financial crisis’ impact on democratic institutions and administrations: a) on the institutional and organizational structure; b) on the content of basic public functions in the contemporary State; c) on the juridical tools of public action. The research will study in a structured and integrated manner all the three indicated forms of impact, by distributing among the 12 research Units the specific items of investigation and by organizing the scientific work in order to favour a large exchange of information and data interpretation among them; by evaluating the changes in legislative disciplines; by identifying alternative solutions, which can assure, in the same time, innovation and economic development on one side and social inclusion and safety on the other. That will place the research perfectly within the Program Horizon 2020 objectives.
The research has a marked interdisciplinary structure. In the juridical field are unified the approaches of constitutional, administrative and public comparative law. Important contributions of non juridical sciences are assured, like sociology (political and organizational) and economy (economic policy, public economy). Crucial is the comparative framework, boosted by the creation of an important “Project international network”, based on 39 research foreign and 11 Italian institutions, which will provide the survey of the differentiated impact of the crisis on countries with different degrees of financial instability and will help in identifying innovative experiences and solutions adopted in the various countries to face the crisis, always in order to assure democracy and quality in the results of public action. That will also permit to propose to the decision-makers some useful model of innovation in the organizational field, in the content of public functions of the contemporary State, in the variety of juridical tools of action.
The scientific work of each of the 12 research Units will provide an in-depth knowledge of the anti-crisis legal disciplines concerning each of the items studied, identified as paradigmatic elements of the impact of the crisis on democratic institutions. This will permit to distinguish, within the legal anti-crisis disciplines adopted in the last ten years, between, respectively, ordinary legislation (to assure the ordinary functioning of public institutions and the fulfillment of public action), measures for financial long period recovery, and measures adopted under an urgent and emergency pressure to face particularly serious crisis.
The research is bound to fill a relevant gap in the scientific knowledge of the crisis impact on institutions, due to: a) the insufficient in-depth analysis of institutional and administrative reforms, which has not critically assessed consequences, drawbacks and legitimation of the measures adopted to deliberately pursue cuts in public expenditure and efficiency; b) the gap between the approach of scholars of economics and legal scholars. The first seem to be fully aware of the risks connected to the financial crisis, but somewhat dismissive as to the processes of reform of legal institutions. The second have been for a long time somewhat dismissive of the importance of financial consequences of decisions and policies relating to the creation of new public functions and apparatus, whose exponential increase is among the factors of the present crisis.
Many of the issues that become dramatically evident when the crisis burst had already been studied as long-term phenomena, meant to have a significant and prolonged effect. The present crisis not only produces an acceleration of such phenomena, but in some cases it changes the overall approach, making people doubt on some of the cornerstones which appeared until now firm.
The Impact of the Financial-Economic Crisis on the Guarantee of Welfare Rights
Controversies on Social Rights as Human Rights
Contrary to the widespread belief, welfare rights are not a twentieth-century innovation, bur are among the first human rights ever to be claimed (J. Griffin, On Human Rights, Oxford, 2008, 176). When in the twelfth and thirteenth centuries our modern conception of a right first appeared, one of the earlier examples offered was the right of those in dire need to receive aid from those in surplus. This right was used to articulate the attractive view of property prevalent in the medieval Church. God has given all things to us in common, but as goods will not be cared for and usefully developed unless assigned to particular individuals, we creatures have instituted systems of property. In these systems, however, an owner is no more than a custodian. We all thus have a right, if we should fall into great need, to receive necessary goods or, failing that, to take them from those in surplus.
Norms which seem have to do with human social rights, even though mentioned as fundamental civil rights, are in some Constitutions and Codes between XVII and XVIII centuries: French Constitution of 1793s,the Prussian Civil Code (1794) the Constitutions of Sweden (1809), Norway (1814), the Netherlands (1814), Denmark (1849).
It is at the end of XIX century that scholars (particularly political theorists) begin to wonder if social rights are basic in the sense in which civil and political rights are in Western societies (L.T. Hobhouse, Liberalism, New York, 1911). In the international political stage a leading role about the attraction of social rights into the human rights sphere is acknowledged to Franklin Roosvelt. In the Atlantic Chart, signed by Roosvelt and Churchill in 1941, we find the idea – expressed in the famous “four liberties” speech – according to which, besides classical civil and political freedoms, there were also freedoms from want and fear. The Atlantic Chart is considered the first step toward the Universal Declaration of Human Rights.
But this inclusion, that we can find in many international instruments, poses a fundamental question. A human right is a claim of all human agents against all other human agents, for instance non to be tortured. But this is not the way we usually think about social rights, which are normally associated with being part of a specific social community, in other word linked to citizenship, and for this related to the sense of cooperation and reciprocity (in an utilitarian view) which take together a political community. On a philosophical ground this idea is often based on the Kantian division of obligations into universal, perfect non-universal and imperfect. Whereas the first two have correlative rights clearly identified (for instance the right of everybody non to be tortured and the promise to receive a service), the third – for instance the duty to be charitable – are deficient in their specification of the person owed the duty. The duty-bearer can use discretion in choosing upon whom to discharge the obligation. This point leads to the other, not necessarily connected to the human rights area, concerning the view according to which there is no relationship between liberty rights and social rights, which would be conceptually distinct each other. The protection of liberty rights is to be realized through a simple abstention of state, on the contrary the implementation of social rights request for positive actions of the State. These were also related to the idea that social rights, unlike liberty ones, are “costly” rights which impose heavy economical burdens on society. These theses were often accompanied by the idea that the main task of the State is protecting liberty rights, while giving effect to social rights is a secondary objective, which could not always be aimed at. In contemporary debate the differentiation between social rights and liberty rights has been strongly criticized (E. Diciotti, Il mercato delle libertà, Bologna, 2006). Firstly, it has been pointed out that these two categories are closely interdependent: more particularly, it has been remarked that full enforcement of liberty rights necessarily requires the attribution of some social rights. Secondly, the very differentiation has been questioned from the conceptual point of view: more particularly, it has been pointed out that the protection of liberty rights, far from requiring a mere abstention on the part of public powers, requires instead burdensome positive services, like making judicially claimable those rights and punishing or discouraging their violation by private individuals. In this connection many studies, both legal and economical, have shown that the public- security apparatus which is necessary to warrant the protection of liberty rights, and the judicial apparatus required to address their violations, are extremely burdensome, far more than those required to provide for basic social services (S. Holmes, C. R. Sunstein). The issue is highly disputed among scholars of International Law because it is becoming predominant a doctrine about indivisibility of rights (I.E. Koch, Human Rights as Indivisible Rights. The Protection of Socio-Economic Demands under the ECHR, Leiden – Boston, 2009). As regards this point the issue of justiciability of social rights is very important: some supreme courts, such as the South African Constitutional court and the Indian High court, have developed a very progressive case law, which, as a consequence of the crisis, in recent times have been put under threat. If we turn our attention to the language both of scholars of Constitutional law and of Constitutions of XX century, we notice that a new category of rights arises, which is the one of fundamental rights, standing between human rights and social rights. This category, born at the beginning of XIX century, according to the contemporary continental constitutionalism includes now such rights (first of all social rights, so called of second generation) – settled in Constitutional Charters and therefore having more solidity, prescriptiveness and attitude to be justiciable – which are among the pillars of constitutional order (Constitutional Court n. 1146/1988). In this sense fundamental rights constitutes a different category from human rights, in order to be linked to a specific state system and for this reason there is not any conceptual problem to speak about fundamental social rights. However between these two categories there are also a number of connections and overlapping: about language, not only common language, about the historical developments of legal systems, about day by day work of legal institutions, about the language of courts, insomuch that we hear to speak more and more about a “universal language of rights”, causing with this some troubles from a theoretic and legal point of view. Apart from this last issue, the example of European Agency of Human Rights is highly instructive. The Member States had initiated the agency project under the term “Human Rights Agency”, but the European Parliament and the Commission succeeded in changing its denomination to “Fundamental Rights Agency”. Accordingly the Agency appears more set to develop the EU as an autonomous polity and EU law as a municipal legal order and less as an element of human rights multilevel architecture ((A. von Bogdandy, J. von Bernstorff, The EU Fundamental Rights Agency within the European and International Architecture: the Legal Framework and some Unsettled Issues in a New Field of Administrative Law, in Common Market Law Review, 2009 (46), 1036). The frame is complex and variable and if from a factual perspective we can sense that the crisis hinders mainly social rights, at the same time we can say that this is not unavoidable if we assume a normative, conceptual, and institutional point of view.
Main Strands of Investigation
The essential aim of the research unit is to analyse the impact of the financial-economic crisis on the guarantee of social rights (as fundamental rights) at a comparative and supranational level. This means making a point first. Taking for granted that rights to receive social benefits from public institutions belongs to national legal systems, we cannot ignore that a significant part of the law discipline about those rights comes from a number of international dispositions and measures.
First of all the UE law level: 1) On the one hand, since the nineties, that is after the Treaty of Maastricht, we have seen the enlargement of European policies beyond the original core relating to the economic and monetary union (this is the phase of the shift from a legal system with specific aims to a legal system with general aims); 2) on the other hand, since the middle of the last decade, increasing credit has been given to the opinion that also the delivery of social services are economic in nature and therefore can be bound by community rules about competition and internal market. The mixture of these two issues has contributed to a new step in the edification of the concept of “European social model”. At the European level, however, the debate, between opinion-makers and scholars of different fields, increasingly deals with the resistance of the “European Social Model” (see S. Civitarese Matteucci, Servizi sanitari, mercato e «modello sociale europeo», in Mercato Concorrenza Regole, 2009 (1), 179) to pressure both from the conflict between member States and EU Institutions and the globalization processes. The second point relates to the global level, namely to the consequence of the “internationalization” of social rights on their actual satisfaction. We need:
- A) to see if the plan to implement human rights (at universal or local level) and the plan to develop the fundamental rights of a specific political community can produce tension. We wonder, in particular, whether the increasing closeness of human rights and constitutional rights produces either an improvement in the implementation of rights or an ongoing contracting in their effectiveness and a relevant impoverishment of their meaning. According to the common view a human right is a claim of all human agents against all other human agents, for instance the right not to be tortured. But this is not the way we usually think about social rights, which are normally associated with being part of a specific social community, in other words linked to citizenship, and for this reason related to the sense of cooperation and reciprocity (in a utilitarian view) which brings together a political community. The implementation of social rights, instead, demands positive actions from the State. This was connected to the idea that social rights, unlike liberty rights, were “expensive” rights, imposing heavy burdens on community;
- B) to understand, Instead, whether the shift (or enrichment of mutual integration) from a concept of rights as essentially guaranteed by domestic institutions to the broader concept of socio-economic rights in the supranational arena cannot constitute an argument for the overcoming of the doctrine of social rights as “financially depending”. According to Fact Sheet No. 33 of the Office of the High Commissioner for Human Rights (Frequently Asked Questions on Economic, Social and Cultural Rights): “strengthening the protection of economic, social and cultural rights is an integral part of strengthening the protection of all the rights recognized in the Universal Declaration of Human Rights. Dispelling the myths specifically surrounding economic, social and cultural rights is crucial to dismantling unworkable categorizations of rights as we move towards a human rights agenda that treats civil, cultural, economic, political and social rights as truly universal, indivisible, interdependent and interrelated”.
The aforementioned points first require the defining and conceptualizing of some issues of a theoretical and lexical nature with important practical consequences: – the language and grammar of rights; – meanings and misunderstandings as regards notions of rights, human rights, fundamental rights, constitutional rights, etc.;
– the usefulness of traditional distinctions between categories, typologies, and generations of rights; – distinctions between social rights as claiming positive actions and liberty rights as claiming inaction, relating to the thesis of the indivisibility of human rights sustained by lawyers and scholars of International law (I.E. Koch, Human Rights as Indivisible Rights, Leiden Boston, 2009). This multiple approach justifies both the involvement in the research unit of the Department of ecclesiastical, socio-philosophical and criminal law sciences of the University of Milan, with particular reference to the philosophical-legal skills, and the presence of scholars of constitutional law.
From a more administrative law perspective, achieving the above mentioned clarifications means: – identifying the basic content of social policies (public functions) which affects public money (health, social assistance, education, housing, national insurance), including the crucial point of the multilevel dimension of welfare in relation to the market and the process of public expenditure; – identifying the fundamental rights, both in abstract and concrete terms, involved in each and all of the aforementioned policies; – examining the actual discipline and organization of the delivery of welfare services relating to the way in which they are affected by the acknowledgment of fundamental/human rights; – examining consequences and intersections between different legislative levels and different ways of enforcing rights by means of the analysis of statutes, regulations, plans, organizational and operational decisions, and case law. Thus, the central point of the investigation stems from the qualification in the “Charter of Rights” of claims relating to Welfare in terms of human/fundamental rights. As for the Italian legal system the most direct and concrete reference is the EU law (including the European Social Charter and the ECHR), particularly after the Lisbon Treaty and the creation of the Fundamental Rights Agency. However we need to widen our perspective to the supranational level, starting from the Universal Declaration of human and citizens’ rights, from which the two United Nations covenants of 1966 stemmed: the one regarding rights in the political and civil sphere, and the other regarding economic, social and cultural rights. In Europe the ECHR and European Social Charter were moulded on these covenants). All of these sources are managed by specific bodies, which have the duty to secure the observance of their provisions (we can think of the European Committee for social rights, and the Committee for economic, social and cultural rights of the United Nations). As for this point, the most important issue is the adjudication of rights enshrined in the Charters, as this is the means by which the abstract dimension of declarations of the Charters intrudes into the discipline and organization of delivery of welfare services. From this point of view a large-scale comparative analysis of high courts decisions will make it possible to grasp the main tendencies, especially as regards the impact of the crisis.
There is a remarkable increase in judicial enforcement of social rights in the recent period. While we find few cases for most of the 20th century both in national and international case law, in the last 20 years – according some studies – we can count one to two hundred thousand cases around the world in which a constitutional or international SEC right has been invoked.
In particular recent judgements from South Africa’s Constitutional Court have captured international attention due to the clarity of judicial reasoning and reliance on explicit constitutional rights. But there are many other examples, like the doctrine of the Colombia constitutional court on “unconstitutional state of affairs”, which uphold the right to immediate access to medicine, or the pivotal role usually acknowledged to India’s Supreme court. Regarding this the Brazilian case is particularly interesting (about which see section 8 of the present form). From the point of view of remedial achievements we meet both cases of issuing specific, positive orders to do something and dialogic and interim remedies.
Yet, this in not an uncontroversial trend, as concerns and general objections remain also when social rights are set out in a Constitutional document. Referring, for example, to the UK Green paper on Rights and Responsibilities, on the one hand, it gives explicit affirmation to the central position of socio-economic rights in the British Constitution, but this on the other hand revives common objections about giving too much power to an unaccountable judiciary, suggesting that it remains inappropriate for socio-economic rights to be judicially enforceable. Regarding this issue the research must carefully consider those studies which have sought to develop models of adjudication which take into due account the role of legislators and administrative bodies and that of the judiciary.
More recently we note, however, a countertendency just in the case law of those courts traditionally considered social rights oriented. An explanation has been suggested in literature according to which these tendencies are part of a de facto harmonisation of constitutional rights protection in the era of neo-liberal globalisation. Despite the presence of idiosyncratic constitutional provisions, these national courts «have begun to articulate analogous conceptions of fundamental rights which are atomistic, ‘market friendly’ and, more broadly, congruent with the narrow neo-liberal conception of rights, and consequently antithetical to the protection of socio- economic rights» (P. O’Connel, The Death of Socio-Economic Rights, Modern Law Review, 2011).
National Welfare Systems and Reforms
A narrower analysis of some European legal systems will make it possible to assess the relationships between supranational level law, policies and patterns of the delivery of welfare services, and the role of courts. Regarding this issue the comparison with a legal system, such as the British one, which lacks a written constitution and in which the resort to international charters seems to operate as a sort of bill of rights, is very interesting.
Spain, French, and Germany are obvious terms of comparison, both for their similar general constitutional approach to social rights and their position in the Eurozone as bigger economies.
One of the most interesting points is to investigate what models are actually employed in the management of social services and how, on the one hand, they face the economic crisis, and, on the other hand, they change as a consequence of the crisis. According to scholars the two archetypical models are the so called bureaucratic-rationality, broadly adopted in European legal systems, and the “moral and personal” oriented one. The former uses quite precise rules to identify kinds of benefits and addresses (“bright line rules”), the latter adopts, instead, standards or principles which give room to the discretionary power of decision-makers (this point has a significant link with the research project of the unit of Perugia).
From these two models different techniques of adjudication, a different role of the invocation of human rights, and different answers to resource restriction are derived, as the case of the UK clearly shows. This last issue calls into question the aspect of social rights most traditionally associated with administrative law in Italian and European tradition, called public service or service of general interest according to the EU language. This involves the decision and arrangement of social services from public bodies through resources and means, regulations, rules of behaviour and organizational patterns, which are not always expressed in truly legal norms, and the concrete selection of the range of beneficiaries also beyond legislative ranked norms.
Yet, in times of crisis, European policies towards member States themselves have assumed a particular profile. We can see, indeed, a strong commitment of EU institution to pose limits on fiscal policies and decisions and to impose actions on States aimed at achieving goals of spending cuts. These kinds of “commands” come not only from the UE, but also from international public (IMF, World Bank) and private (rating agencies) bodies, which decode market expectations about the reliability of sovereign debts.
For some of these we must also face the problem of the conditionality of measures of the financial backing: these bodies often request, in order to concede financial aid to a State, to adopt specific measures, even though they do not have all the instruments to assess the consequences of those measures in the relevant legal system. Other problems which arise from these policies are the weird relationships with United Nations actions in favour of economic, social and cultural rights and the nature of the relations between the IMF and the country which benefits from the aid.
The crisis hits, indeed, both contents of the key-duties of the Welfare State and the means of delivery. We can refer to the duty of guaranteeing the so called essential level of services regarding citizens’ social rights (protected as fundamental rights) with the consequent need to actually organize such services and benefits. We need to evaluate the consequences of this, on the one hand, in terms of transformation of the existing legal and administrative infrastructure, and, on the other hand, in terms of the identification of solutions suited to securing innovation and economic growth together with social cohesion and safety. Therefore an even stricter cooperation among all research units is required to fulfil this task, but particularly significant is the collaboration with the research unit of Florence, which deals with the redistributive function of the State.
The problem is, in brief, to avoid the gap between simple utterance of social rights as fundamental rights and actual protection of the former, with the aim of really conceiving those rights as proper human rights. In this way they could be implemented from both a subjective point of view (qualitative and quantitative guarantee of services ascribable to human rights) and an objective point of view (acknowledgement of the entitlement to a social right beyond the fence constituted by the idea of national or European citizenship). To this outcome we need to try to analyse diachronically, resorting to already available data, the impact of the enforcement of such “rights” on the economy (here again the contribution of a scholar of economics is important), in order to have an idea of their sustainability, feasibleness, and justiciability.
Hypotheses which are to be evaluated are the inclusion of the Social Charter into the EU Treaty and the attribution to the EU of the competence to set an essential level of services throughout Europe, so as to guarantee a minimum core of contents of social rights at this higher stage. The prospect is inevitably the edification of a European social model which is open and gives solidarity, which would presume an actual process of political and fiscal integration/unification. This process would avoid going adrift between the options of either to increase national sovereign debts (shifting the burden of debt on future generations) either to give up making the EU responsible of the burdensome duty of sustaining integration and solidarity as a way of responding to the crisis challenges. To do this the path could be to conciliate a severe application of the principle of balance stability or equilibrium – avoiding reducing it to the only objective of the “parity” – with a progressive use of fiscal policies, yet to interpret as not only national but also European goals (A. Spadaro, I diritti sociali di fronte alla crisi, in AIC, 2011, 4).
Also as regards the “overhauling” of social rights and delivery of social services in times of permanent economic crisis, the contribution in terms both of legal thought and identification of social and institutional mechanisms coming from the international debate about economic, social and cultural rights has to be taken into specific and critical consideration.