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InnoSI Report Summary

Project ID: 649189
Funded under: H2020-EU.3.6.

Periodic Reporting for period 1 - InnoSI (Innovative Social Investment: Strengthening communities in Europe (InnoSI))

Reporting period: 2015-05-01 to 2016-04-30

Summary of the context and overall objectives of the project

European welfare states were designed to offer support against Twentieth Century social and economic risks. But European societies are changing in a number of interlinked areas including demography, globalisation, ecological sustainability, family structure, employment, poverty and social inclusion. The economic crisis of 2008 and its aftermath have emphasized that EU Member States will have to adopt distinctive social welfare reforms to improve their resilience and prepare for future economic and social risks. Social investment involves strengthening people’s current and future capacities and, in contrast to a straightforward redistributive approach to social policy, it uses welfare as a way of investing to improve prospects for future economic and social participation. It is the idea of having a lasting impact that gives such policies the characteristics of an investment by offering some returns over time.

However, to date, implementation of Social Investment approaches has been uneven across Member States and much remains to be learned, especially with regard to the regional and local realities of Social Investment. Many models of Social Investment are possible depending upon how policy, social and managerial roles are distributed between the public, private and third sectors and the specific legal and financial frameworks that are used.
The question we address is how to design robust social investment strategies which can deal with emerging socio-economic challenges and the aftershocks of the 2008 crisis. Our investigation of innovative approaches to implement social investment covers a number of dimensions:

• regional and local implementation of social investment policies;
• financial and regulatory innovations designed to promote social investment;
• the role of social innovation in the design and implementation of social investment policies;
• the potential for social investment strategies to encourage early intervention and life-course perspectives
within welfare; and
• the development of more personalized approaches to the deliver of welfare.

Our project aims are as follows:

1. Identify and evaluate existing innovative and strategic approaches to social welfare reform which utilise social innovation at a regional and local level.
2. For those socially innovative and strategic approaches to welfare reform identified during Aim 1, we will explore the social and psychological impact of welfare reform on individuals and communities:
3. For those interventions considered in Aim 2 to be successful, we seek to identify ways of implementing effective innovative and strategic approaches to welfare reform (including social financing) and establish pathways to impact for knowledge created during the project.

Work performed from the beginning of the project to the end of the period covered by the report and main results achieved so far

After project initiation that included a project start-up meeting in the UK and development and refinement of the project plan we undertook a review of existing literature on social investment and a short review of policy in the ten Member States that the project is operating in. Simultaneously we undertook cross-European comparative analysis of administrative data which provides a quantitative, comparative overview of social investment strategies across the 28 member states of the European Union at different levels and which is complemented by an integrated report on the role of the social economy to deliver social outcomes in the ten project countries. The outcomes of the literature review, policy review and comparative analysis have resulted in a series of Deliverables, the findings in which have shaped later Work Packages.

A programme of case study research is underway. It consists of 20 in-depth, multi method case studies in ten EU countries of innovative, strategic approaches to delivering social investment policy at a regional or local level. We will use the case studies to document innovative approaches to social investment, and to assess and compare them with sensitivity to local embeddedness and socio-cultural contexts.

We are committed to having a strong user voice within the project. We are recruiting training Community Reporters in ten case studies. The recruitment and training of community reporters is underway and 33 User Voice stories from Utrecht and Kajaani have so far been collected and shared (
Results from all the strands of described above are assimilated in a foresight analysis where we consider options for innovative ways of implementing and financing social welfare systems in the future. The two elements of the foresight work are scenario planning and econometric modelling. The scenario planning is progressing according to plan. To date all academic partners have recruited a group of experts for local signal scanners. Altogether 116 individuals were involved in scanning the signals and in total 1643 signals were collected. The econometric modelling is in the planning stages.

Approximately a third of project resource is allocated to generating policy impact and work on this is also underway, albeit at an early stage. The consortium includes a network of Impact Partners with an interest in delivering social investment to turn outputs from research process and the foresight analysis into practical policy recommendations. In this reporting period guidance on creating impact was produced and preparation was commenced for mapping policy-makers and developing knowledge mobilisation plans for each Impact Partner.

The project has a dissemination and communication strategy. Key outputs in the first 12 months of the project include a detailed dissemination strategy, a project website (, blogs and research reports.

Project management is ongoing. The consortium held its second a consortium meeting and also finalised ethical approval and data management plans.

Progress beyond the state of the art and expected potential impact (including the socio-economic impact and the wider societal implications of the project so far)

A series of research reports have been produced. Most findings to date relate to the first Aim of the project.

Analysis from the literature review (WP2) suggest that;

• The “Social Investment” approach and reform agenda are ideas and concepts widespread in the current academic debate and scientific literature.
• Defining a “Social Investment” approach is a challenge because the literature contains different ideas about the role of the state in the process of shaping social policy systems.
• Social investment is often presented as an alternative to neo-liberal welfare models.
• While there is some previous empirical research at a national level, there is a paucity of empirical research
at a sub-national level.
• There is extensive literature about implementation of social investment, but much of it is only loosely
underpinned by empirical research.

The policy analysis suggests that:

• In terms of improving prospects, at national and international level, economic justifications of social
investment reform agendas appear to weigh more heavily than societal ones. However, our analysis suggested
that the real value of welfare state reforms is not simply economic, in the narrow sense of meeting economic
indicators. It is revealed in the ways in which it changes the lives of people and families – and transforms
• Many reforms that might loosely be termed social investment were led entirely led by public sector actors,
with limited social economy or private sector engagement.
• Where ‘mixed-economy’ approaches to social investment are evident there is a distinction between well-
established models of public-private-social economy cooperation (e.g. public procurement, State aid,
concessions) and new models of cooperation (e.g. payment by results, social impact bonds, social impact
• While to an extent social innovation practices are beginning to contribute to welfare state reforms, this is
generally at the margins in particular initiatives.
• User voice is generally not present in welfare state reforms but could contribute significantly to the reform

Comparative analysis of social investment confirms to some extent the interpretation of a quiet revolution (Hemerijck 2015). Thus, the thesis of a stable European welfare system proceeding in a slow but progressive way is confirmed. However, other aspects of the analysis run contrary to Hemerijk’s analysis. Thus, we find no clear trends towards more social investment spending. In particular there is not a clear trade-off, either between compensatory and social investment spending, nor between social spending for elderly and social spending for childhood and youth.

Analysis of the role of Social Economy in delivering Social Investment related to Social Innovation suggests that in general Social Economy organizations have: a high level of involvement in the macro policy area ‘support for early childhood development’; a medium level in the macro policy area ‘support for parents’ labour market participation’; and a low level in macro policy area ‘policy measures to address social and labour market exclusion’. 

Analysis of the role of Social Economy in delivering social outcomes suggests that after the increasing support of social economy before the crisis, a stagnation or even decreasing tendency becomes visible in the observed policy fields and countries – a result of fiscal consolidation. The interaction of public and social actors has been adjusted to a market-like arrangement, where the former partnership model has been replaced by a ‘contracting’ model. Thus, social economy organisations are confronted with a more and more liberal welfare market with a strengthening of competition, new public management tools, free choice approaches and concepts of a plural social

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