A European Semester for the wellbeing of people and the planet
Is the Semester delivering a Wellbeing Economy?
EuroHealthNet has investigated how the 2024 European Semester process, especially the formulation of Country-Specific Recommendations, supports the EU agenda of reducing social and health inequalities and how the Semester architecture can support the Wellbeing Economy.
For EuroHealthNet, the adoption of a Wellbeing Economy is the way forward to achieve a healthy, prosperous, and cohesive Europe, supporting the European Union’s (EU) strategic goals and initiatives, such as the European Pillar of Social Rights, the UN Sustainable Development Goals, the Green Deal, and the Recovery and Resilience Plan. The Wellbeing Economy can also contribute to budget and debt sustainability in the long-term since it prioritises investment with a high return.
EuroHealthNet’s analysis indicates that some progress has been made to advance social, health, and environmental goals and for achieving wellbeing. However, improvement is still needed to advance a Wellbeing Economy and put social, health, and environmental goals on equal footing with fiscal and economic objectives.
What is the European Semester?
The European Semester is the core socioeconomic governance system of the European Union, aiming to align Member States’ policies and reforms within the EU towards common strategic goals and initiatives.
Every year, the European Commission issues the annual priorities in the Annual Sustainable Growth Survey, reviews the economic and social situation of each Member State, and issues Country-Specific Recommendations (CSRs) to guide national governments in achieving European objectives.
Each year, EuroHealthNet analyses the European Semester process from a health equity perspective.
Increased focus on social, environment, and health within the European Semester, but further developments are needed for a Wellbeing Economy
Initially, the focus of the European Semester was almost exclusively on national public budgets and debt discipline. The process has progressively expanded to include social, environmental, and health policies. With social and environmental objectives gaining more attention as EU priorities, more CSRs have been issues to support these policies.
These improvements on social, health, and environmental policies, as well as social investment through the European Semester Process, are steps in the right direction for ensuring Europe is delivering for people and the planet’s wellbeing.
However, despite these encouraging initiatives, there is much work to be done to reach a European Semester more oriented towards the wellbeing of people and planet and not just for economic growth defined as GDP. Likewise, the development of explicit wellbeing indicators and their policy prioritisation within the Semester is still far from being achieved.
Started in 2010, after the global financial and economic crises of 2008-2009, the Semester brings together different European mechanisms, such as the Stability and Growth Pact, the Macroeconomic Imbalance Procedure, and the Employment Guidelines, under one single annual cycle of policy coordination.
Putting wellbeing at the heart of economic policy
What is a Wellbeing Economy?
In our current system, the success of our economies and societies is measured through economic growth, without regards of the costs to health and the environment. The Wellbeing Economy model aims to put the economy at the service of what should be our ultimate objective: our wellbeing and that of the planet
The transformative approach of the Wellbeing Economy moves the focus away from an economic system that is structurally dependent on GDP growth. Instead, it values human health, environmental sustainability, social equity, and wellbeing as core indicators of success. Policies and legislation are assessed on their impact on and potential to improve wellbeing. This creates a virtuous circle, where improved wellbeing increases economic benefits and vice versa.
Under the Wellbeing Economy, economic growth is not an end, but a means to improve societal and planetary wellbeing. The limitations of an economic model based only on economic growth, measured as GDP, are clear in terms of rising inequalities and social exclusion, social polarisation, and the deterioration of environmental and human health. The need to adopt economic models that better reflect their real impact on people and the environment is increasingly recognised.
Assessment of the 2024 cycle: the Country-Specific Recommendations, the Social Convergence Framework, the new Economic Governance, and the indicators for a Wellbeing Economy
- The Country-Specific Recommendations: There are some improvements in the formulation of the Country-Specific Recommendations when it comes to addressing social and health inequalities and the wellbeing of people and planet. However, there are also some shortcomings and missed opportunities:
- The Social Convergence Framework: The introduction of the Social Convergence Framework reflects a stronger attention to social and health aspects by highlighting social risks as identified by the Social Scoreboard monitoring system. However, in the absence of an automatic link between identified social risks and Country-Specific Recommendations, it remains unclear how the Framework can be effective in prompting Member States to address their social risks.
- The 2024 review of the European Economic Governance Framework: Under the new Economic Governance framework, there is a potential for stronger investment support, including in social and health sectors. By introducing a longer-term perspective to assess Member States’ debts and deficits, public expenditure for social inclusion and health promotion is to be considered as productive investment, leading to more sustainable public finance in the future. However, in the absence of a ‘golden rule’ to automatically ring-fence social and health investment, the real impact of this narrative on advancing social and health investment will have to be assessed in the coming years.
A wellbeing framework with indicators for the Semester
With over 100 indicators already existing to assess Member States’ performance under the Semester process, there is good potential to shift the focus towards ‘wellbeing’. However, it is necessary to develop an adequate Wellbeing framework, setting out different dimensions of wellbeing, accompanied by relevant monitoring tools and indicators. Developing such a framework would make the Semester more relevant to the real needs of citizens.
Policy recommendations
EuroHealthNet’s analysis indicates that some progress has been made within the European Semester to advance social, health, and environmental goals. Stronger efforts are, however, needed to reorient the process and achieve a Wellbeing Economy, putting social, health, and environmental goals on equal footing with fiscal and economic objectives.
These are EuroHealthNet’s policy recommendations to improve the European Semester process:
1
Strengthening efforts to develop a European Wellbeing Framework within the European Semester process. It is necessary to invest in progressing current initiatives, such as the European Joint Research Centre, to develop a European Sustainable and Inclusive Wellbeing framework and dashboard with relevant indicators. This initiative will facilitate the process of assessing how Member States are contributing to a range of policy objectives beyond economic growth alone.
2
Prioritising Wellbeing Economy measures in the selection of indicators to be reflected in the Country-Specific Recommendations. As a first step, indicators such as self-reported mental health and loneliness must be introduced in the Social Scoreboard of the European Pillar of Social Rights. Secondly, the European Wellbeing Framework of indicators needs to be agreed on. This includes equity in health, education for social inclusion, and health literacy, as well as health and wellbeing aspects in housing, climate change, and environmental pollution.
As a further step, a separate shadow report is necessary to complement Member States’ national reports to assess the real state of the wellbeing of people and the planet.
3
Improving the impact of the Social Convergence Framework on Member States’ policy and reform development. It will be important to fully embed the Social Convergence Framework in the Semester process, ensuring better links between identified social risks and the formulation of Country-Specific Recommendations.
4
Ensuring stronger social, health, and green investment under the new Economic Governance Framework. Measures for budget and debt reduction must be balanced with clear and strong Country-Specific Recommendations to invest in health promotion and prevention, going beyond the health systems to include social, employment, environmental aspects, and wellbeing. To this end, tools such as Return on Investment must be embedded in the Semester to safeguard public investment from budget cuts and austerity measures detrimental to social, health, and environmental wellbeing.
What's next?
During its mandate 2025-2030, the European Commission will prepare a new Anti-Poverty Strategy, strengthen the European Pillar of Social Rights by reviewing its Action Plan, and present a Housing Affordability Initiative. It will be important to prepare these policy frameworks, taking into consideration the Wellbeing Economy, as well as to continue efforts to ensure the European Semester is delivering for people and the planet’s wellbeing and to further strengthen the social, health, and environmental dimensions.
Keeping a strong focus on wellbeing is necessary to ensure the current narrative on European competitiveness will have a social inclusion, health, and cohesion dimension at its centre, preserving our European social model and values of social solidarity, enshrined in European Treaties.
A European Semester
for the wellbeing of people and the planet
Is the Semester delivering a
Wellbeing Economy?
Related resources
An Economy of Wellbeing for Health Equity
Fostering a transition towards healthier, more inclusive, and sustainable societies
European Pillar of Social Rights Flashcard Tool
A guide for public health professionals and decision-makers
