All Member States are expected to accumulate savings in good times so as to be able to have sufficient latitude for the operation of the so-called automatic stabilisers (e.g. higher welfare spending and lower tax revenues) during the downturns. In good times, the revenues of the state increase due to more vigorous economic activity and expenditure related to the unemployment falls.

Considers that, given budgetary pressure, efficiency in social spending is of major importance; considers that, in view of the current budgetary pressure, social spending has played a significant economic and social role in softening the effects of the crisis; considers that pay-as-you-go schemes have demonstrated their fundamental role in creating solidarity between generations; also considers that the second and third pillars have a supplementary role to play in reducing pressure; calls on Member States to ensure the best possible mix of forms of pension provision to safeguard pensions in the future; calls upon Member States to im ...[+++]prove citizens’ access to private savings schemes; points out that, because of the financial crisis, several Member States are planning to introduce changes to their pension systems; urges them, however, to ensure that all pension systems remain stable, reliable and sustainable, and that all changes are made after adequate social dialogue and on the basis of the provision of sufficient information; advocates that, if choices can be made by employees, enough time should be provided for them to make informed and well thought-out decisions;

The government has recently adopted a public finance reform which provides for savings in social spending and administrative expenditure over the period 2004-2007.

Accordingly, on this measure public expenditure contributes almost twice as much to income in the former two regions, which are the least prosperous in the UK, than the latter two, primarily because of their much lower level of GDP per head and, to a lesser extent, their greater need for social spending.

[21] For instance, work undertaken in the OECD suggests that increased active social spending - on active labour market policies, payments to low income households, expenditures on family and child care, and investment in health - may have a significant impact on productivity and economic growth.

The composition of social expenditure has also not changed, if not slightly: 62.2% is made up of old-age and survivors' pensions.