NOVI – a warning system for threats to welfare

The Nordic Welfare Watch became a platform involving voluntary organisations, municipalities, local authorities and the labour market, among others. It was tasked with monitoring social and economic consequences based on social indicators that were produced. These indicators became measurement points which allowed the Nordic Welfare Watch to evaluate initiatives and activities. The Nordic Welfare Watch also presented politicians and decision-makers with suggestions for new measures and maintained a constant dialogue with the authorities.

Comparable measurements of welfare

Based on the experience of the Nordic Welfare Watch, during Iceland’s presidency of the Nordic Council of Ministers in 2014 a project was initiated aimed at developing a common indicator system for the Nordic countries. These indicators, known as the Nordic Welfare Indicators (NOVI), are key comparable measurements of welfare in the Nordic countries and make it possible to identify similarities and differences between the Nordic countries over time. The idea is that NOVI will provide an indication of any negative or positive trend in one or more countries. By extension, the aim is for NOVI to contribute to an improved knowledge base for political decisions.

“For Iceland, it was important to read off what the indicators showed – because then we could see which measures were most relevant to safeguarding those who were most vulnerable,” says Siv Friðleifsdóttir, Chair of the Nordic Welfare Watch. She continues:

“A Nordic welfare indicator system, with figures that provide a factual basis, could become an important instrument for decision-makers in the Nordic countries.”

Pilot to be evaluated

NOVI will be presented in more detail at the Nordic Welfare Forum 2018 and is a pilot project that is to be evaluated. The system is a first step in bringing together central and comparable measurements of welfare in the Nordic countries.

As currently designed, NOVI is mainly based on existing Nordic and European statistics. The idea behind NOVI – as with other indicator systems – is that it will be developed further in terms of both which indicators to include and the quality of the indicators. In an international perspective, the Nordic countries have a unique opportunity to use registers and administrative data. The idea is to gradually develop NOVI using statistics based on these sources.

“It is also important to point out that it is about a range of indicators, not just statistics,” says Håkan Nyman, who was Project Manager for NOVI’s development. “There is a difference between indicators and statistics. Indicators are defined so as to allow follow-up of outcomes which can be influenced through policy.”

Sigríður Jónsdóttir of Iceland’s Ministry of Welfare was Project Leader for NOVI. She believes that NOVI is a first step in bringing together central and comparable indicators of welfare in the Nordic countries.

“NOVI will be important because we do not have a structured indicator system for welfare. In contrast to indicators found in European collaborations, for example, NOVI is able to present indicators that are more detailed and that allow comparison and analysis of different groups of the population based on such aspects as age, gender, educational attainment and income,” says Sigríður Jónsdóttir.

Welfare model in crisis

Research – including that reported in the journal Nordic Welfare Research and in the article “All’s well in Iceland” by Geir Gunnlaugsson and Jonina Einarsdottir – suggests that the social model that we apply in the Nordic region, the welfare model, is a protective factor in itself. Despite deficits, cutbacks and crisis, Iceland was able to maintain fundamental welfare functions in the area of health and social services. This allowed the most vulnerable members of society to be protected.

When unemployment increased, the Icelandic strategy was to extend unemployment benefit for individuals while at the same time allowing them to study. The overall aim was to keep unemployed people active, all with a view to avoiding the negative consequences of long-term unemployment on health. Today the unemployment rate has returned to its pre-crisis level and Iceland is attracting foreign labour to its expanding tourism industry.

The researchers maintain that having a robust welfare system already in place before a crisis and a policy that aims to minimise the negative effects of a crisis is what protects a population from the negative consequences of any economic collapse. The article “All’s well in Iceland” draws a comparison with Greece – a country that went into a deep economic crisis without a robust welfare system in the background. The population there was more vulnerable than that of Iceland, and the recovery has not been as evident either.

By Judit Hadnagy

Nordic Welfare Centre