STUDY Budget Consolidation and the European Social Model The Effects of European Austerity Programmes on Social Security Systems ARNE HEISE AND HANNA LIERSE March 2011 ࡯ The financial and economic crisis is intensifying the pressure for budget consolidation, increasing the likelihood of cuts in social services throughout Europe. One govern­ment after another is bringing forward a budget consolidation programme. Cuts are envisaged above all in social services and so the question arises of what effects this will have on welfare states in EU member countries and on Social Europe in general. ࡯ In this study cuts in social systems are analysed and compared, both planned and already undertaken. Regardless of the different magnitudes of the austerity efforts and the policy fields concerned there can be no doubt that all austerity programmes are regressive in nature and that the option of raising incomes is being exercised far less frequently than spending cuts – and this applies especially in the social realm. ࡯ Summary: The relatively close connection between economic development and the level of social security in Europe is continuing to dissolve. At the same time, social policy at the European level remains the Achilles heel of European integration. There is neither a uniform European Social Model nor has there been any attempt to rectify the legitimacy deficit of European integration by including social security systems in the EU governance system beyond mere lip service. Now the austerity policies of European states are increasing the risk of further social dumping processes.