Balancing Timeliness, Efficiency and Effectiveness: An Assessment of Targeted Social Policies in Challenging Times

Abstract

Timely support is evidently vital when people face sudden income shocks. Nevertheless, most contemporary social policy research on the effectiveness of targeted income support adopts an annual focus. During the COVID-19 pandemic, the timeliness of social support became especially salient. Labour market incomes varied largely month-to-month, and governments reacted with both old and newly designed social policy measures. The latter were designed in a profoundly different policy-making context, in which it was difficult to foresee their effectiveness and cost, while the organisation and implementation of timely income protection measures gained new precedence. In Belgium, the COVID-19 pandemic prompted a multitude of new or substantially changed targeted income support measures across its different regions. This heterogeneity enables an in-depth analysis of the relationship between targeting design features and the effectiveness and timeliness of social policies. Using the EU-SILC and EUROMOD, we assess the impact of social measures on monthly net disposable incomes derived from nowcasted labour market transitions. We evaluate the timeliness of policies from an intra-year perspective, exploring the link between targeting design, implementation, and outcomes, and do so for the interesting case of social crisis measures in a turbulent period. We find that large pre-existing job retention and categorical income replacement schemes were crucial and timely in maintaining living standards and preventing poverty, while smaller, purpose-designed lump-sum benefits played only a supplementary role. Interestingly, targeting choices designed to expedite benefit payments, such as passporting on existing beneficiary status, did not substantially improve timeliness.