Social Sustainability
#2Key Findings
Denmark falls into the top group internationally (rank 2) with regard to social sustainability.
Public spending on education is very high by cross-OECD standards. Concerns that too few students pursue vocational training have led the government to tighten access to university education. Freely accessible education contributes to high rates of social mobility.
The welfare state provides a generous safety net, resulting in very low poverty rates and income inequality. Only about 3.7% of the population lives below the relative poverty line. Citizens have universal entitlement to healthcare. Reforms have concentrated services into centralized hospitals, but local healthcare centers are also beginning to be expected.
Denmark is one of the world’s most gender-equal countries, though a small gender pay gap persists. Women’s employment rates are very high, and a significant majority of children attend daycare facilities. Pension reforms have responded to population aging. Immigration rules have tightened since 2002, with broad political support for restrictive measures.
Public spending on education is very high by cross-OECD standards. Concerns that too few students pursue vocational training have led the government to tighten access to university education. Freely accessible education contributes to high rates of social mobility.
The welfare state provides a generous safety net, resulting in very low poverty rates and income inequality. Only about 3.7% of the population lives below the relative poverty line. Citizens have universal entitlement to healthcare. Reforms have concentrated services into centralized hospitals, but local healthcare centers are also beginning to be expected.
Denmark is one of the world’s most gender-equal countries, though a small gender pay gap persists. Women’s employment rates are very high, and a significant majority of children attend daycare facilities. Pension reforms have responded to population aging. Immigration rules have tightened since 2002, with broad political support for restrictive measures.
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To what extent do policies and regulations in the education system hinder or facilitate high-quality education and training?
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9
Education policies are fully aligned with the goal of ensuring high-quality education and training.
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7
6
Education policies are largely aligned with the goal of ensuring high-quality education and training.
5
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3
4
3
Education policies are only somewhat aligned with the goal of ensuring high-quality education and training.
2
1
1
Education policies are not at all aligned with the goal of ensuring high-quality education and training.
Education is generally tax-financed, and public educational expenditures as a share of GDP are among the highest in the OECD (OECD 2023). Study grants and borrowing facilities are some of the most generous in the OECD. While the educational level is high, there is increasing concern that too few students choose vocational training tracks relevant either to the private sector or to welfare jobs in the public sector.
There is an extensive training system that allows employees to update their education, and collective agreements generally ensure opportunities for lifelong learning.
The Danish educational system is currently undergoing a transition. A vast majority in parliament is concerned that too many young people are drawn to university programs. Consequently, a reform of university education has been passed. First, some master’s programs will be shortened to durations of 1.25 years from two years. Second, the reform will tighten access to university education, with stricter admissions criteria. To ensure there is sufficient human capital with a university degree, an MA council has been created. The council is responsible for monitoring labor market demands and offering recommendations on the number of students needed in different fields. Additionally, the reform stipulates that the revenue saved from reduced university spending will be invested in crafts training, education for nurses and other education linked to the so-called welfare state professions (Ministry of Higher Education and Science 2023).
The reform is largely initiated in response to changes in the demographic composition of the Danish population.
Citations:
Ministry of Higer Education and Science. 2023. Reform af universitetsuddannelserne i Danmark. https://ufm.dk/uddannelse/videregaende-uddannelse/temaer/forberedt-pa-fremtiden/reform-af-universitetsuddannelserne-i-danmark
OECD. 2023. Education at a Glance 2023: OECD Indicators. Paris: OECD Publishing. https://doi.org/10.1787/e13bef63-en
There is an extensive training system that allows employees to update their education, and collective agreements generally ensure opportunities for lifelong learning.
The Danish educational system is currently undergoing a transition. A vast majority in parliament is concerned that too many young people are drawn to university programs. Consequently, a reform of university education has been passed. First, some master’s programs will be shortened to durations of 1.25 years from two years. Second, the reform will tighten access to university education, with stricter admissions criteria. To ensure there is sufficient human capital with a university degree, an MA council has been created. The council is responsible for monitoring labor market demands and offering recommendations on the number of students needed in different fields. Additionally, the reform stipulates that the revenue saved from reduced university spending will be invested in crafts training, education for nurses and other education linked to the so-called welfare state professions (Ministry of Higher Education and Science 2023).
The reform is largely initiated in response to changes in the demographic composition of the Danish population.
Citations:
Ministry of Higer Education and Science. 2023. Reform af universitetsuddannelserne i Danmark. https://ufm.dk/uddannelse/videregaende-uddannelse/temaer/forberedt-pa-fremtiden/reform-af-universitetsuddannelserne-i-danmark
OECD. 2023. Education at a Glance 2023: OECD Indicators. Paris: OECD Publishing. https://doi.org/10.1787/e13bef63-en
To what extent does the current policy approach in the education system hinder or facilitate equitable access to high-quality education and training?
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9
9
Education policies are fully aligned with the goal of ensuring equitable access to high-quality education and training.
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7
6
Education policies are largely aligned with the goal of ensuring equitable access to high-quality education and training.
5
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3
4
3
Education policies are only somewhat aligned with the goal of ensuring equitable access to high-quality education and training.
2
1
1
Education policies are not at all aligned with the goal of ensuring equitable access to high-quality education and training.
The Danish educational system is largely publicly funded and freely available. This can help explain why social mobility is high in Denmark compared to other wealthy countries (Heckman and Landersø 2021). Despite this, Heckman and Landersø also find that social mobility is decreasing and social reproduction is increasing. They also observe that it is unclear exactly what the policy response should be, given that the Danish educational system is relatively well funded. Recently, the Rockwool Foundation, an independent research institute, has suggested that it is early in the educational system that children are sorted into different paths, given access to different types of jobs and hence different levels of income.
Citations:
Heckman, James and Rasmus Landersø. 2021. “Lessons for Americans from Denmark about Inequality and Social Mobility.” Labour Economics 77.
Rockwool foundation. 2023. “Social arv og offentlige udgifter til uddannelse.” Samfundøkonomen (https://rockwoolfonden.s3.eu-central-1.amazonaws.com/wp-content/uploads/2024/03/Social-arv-og-offentlige-udgifter-til-uddannelse_Samfundsokonomen_9_2_2023.pdf?download=true)
Citations:
Heckman, James and Rasmus Landersø. 2021. “Lessons for Americans from Denmark about Inequality and Social Mobility.” Labour Economics 77.
Rockwool foundation. 2023. “Social arv og offentlige udgifter til uddannelse.” Samfundøkonomen (https://rockwoolfonden.s3.eu-central-1.amazonaws.com/wp-content/uploads/2024/03/Social-arv-og-offentlige-udgifter-til-uddannelse_Samfundsokonomen_9_2_2023.pdf?download=true)
Graph View
To what extent do existing institutions ensure equal access to essential services and basic income support for those in need?
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Existing essential public services and basic income support are fully aligned with the goal of ensuring equal access for those in need.
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Existing essential public services and basic income support are largely aligned with the goal of ensuring equal access for those in need.
5
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3
Existing essential public services and basic income support are only somewhat aligned with the goal of ensuring equal access for those in need.
2
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1
Existing essential public services and basic income support are not at all aligned with the goal of ensuring equal access for those in need.
The welfare state offers a relatively generous social safety net, evidenced by very low poverty rates and low levels of income inequality when compared internationally. Social assistance serves as the support of last resort; it is a needs- and means-tested system that includes both basic transfers and various supplements, such as housing assistance. Additionally, the welfare state provides free access to education, healthcare and old-age care, implying that there are few economic barriers to access.
Most social transfer programs have recently been reformed with a greater focus on employment. These reforms aim to strengthen the incentive to work, though this may result in poverty for those failing or unable to respond to these incentives. The reform of the disability pension scheme means that individuals below the age of 40 cannot be granted a disability pension, except in cases of severe or permanent loss of work capability. Instead, the focus has shifted to using and developing an individual’s remaining work capabilities. Similarly, the social assistance scheme has been reformed with a particular focus on improving the educational attainment of young workers (people below the age of 30). For other age groups, the system now offers more flexibility and individualized solutions.
Eligibility for social assistance depends both on a residence requirement (with immigrants needing to have been residents in Denmark for nine out of the last 10 years) and a work requirement (2.5 years of full-time employment within the last 10 years). Moreover, there is an upper cap on total support (social assistance, housing supplement, child supplement). Immigrants who do not meet the residence requirement receive the lower so-called introduction benefit.
According to Danish law, municipalities are responsible for welfare state functions, including informing citizens about their rights and providing the aid they need. This information is easily accessible, and citizens can apply for support via online systems. Municipalities are responsible for all labor market transfers and must monitor that recipients of these transfers meet requirements, such as actively searching for and applying for jobs.
There are ongoing discussions regarding the design of the social safety net and the precision of its targeting. Based on recommendations from expert groups (Transfer Commission 2021), a number of changes have been made to simplify the system and improve targeting, particularly for families with children.
Citations:
Transfer Commission. 2021. “Recommendations to a New Transfer System.” https://bm.dk/media/17892/ydelseskommissionen-afrapportering-web.pdf
Most social transfer programs have recently been reformed with a greater focus on employment. These reforms aim to strengthen the incentive to work, though this may result in poverty for those failing or unable to respond to these incentives. The reform of the disability pension scheme means that individuals below the age of 40 cannot be granted a disability pension, except in cases of severe or permanent loss of work capability. Instead, the focus has shifted to using and developing an individual’s remaining work capabilities. Similarly, the social assistance scheme has been reformed with a particular focus on improving the educational attainment of young workers (people below the age of 30). For other age groups, the system now offers more flexibility and individualized solutions.
Eligibility for social assistance depends both on a residence requirement (with immigrants needing to have been residents in Denmark for nine out of the last 10 years) and a work requirement (2.5 years of full-time employment within the last 10 years). Moreover, there is an upper cap on total support (social assistance, housing supplement, child supplement). Immigrants who do not meet the residence requirement receive the lower so-called introduction benefit.
According to Danish law, municipalities are responsible for welfare state functions, including informing citizens about their rights and providing the aid they need. This information is easily accessible, and citizens can apply for support via online systems. Municipalities are responsible for all labor market transfers and must monitor that recipients of these transfers meet requirements, such as actively searching for and applying for jobs.
There are ongoing discussions regarding the design of the social safety net and the precision of its targeting. Based on recommendations from expert groups (Transfer Commission 2021), a number of changes have been made to simplify the system and improve targeting, particularly for families with children.
Citations:
Transfer Commission. 2021. “Recommendations to a New Transfer System.” https://bm.dk/media/17892/ydelseskommissionen-afrapportering-web.pdf
To what extent do existing institutions and policies ensure high-quality services and basic income support?
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Existing essential public services and basic income support are fully aligned with the goal of satisfying basic human needs.
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7
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Existing essential public services and basic income support are largely aligned with the goal of satisfying basic human needs.
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3
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Existing essential public services and basic income support are only somewhat aligned with the goal of satisfying basic human needs.
2
1
1
Existing essential public services and basic income support are not at all aligned with the goal of satisfying basic human needs.
The Danish welfare state is comprehensive and offers support through income and in-kind transfers such as housing and healthcare, providing what can be called a dignified human life. There are extensive programs in place that ensure every citizen attains an acceptable material living standard. The share of the population falling below the poverty line is small, and income inequality rates are relatively low in international comparison. According to Statistics Denmark, about 3.7% of the population lives under conditions that qualify as relative poverty. Relative poverty is defined as having a net income below 50% of the median income (Statistics Denmark 2023).
Municipalities and other public institutions provide assistance to elderly citizens in learning how to access municipal and public services through the online system MitID, the portal for contacting the welfare state. Computers are available at all municipal libraries. Students and pensioners receive subsidies for public transportation, resulting in very low rates for monthly passes.
Despite the comprehensive welfare state, some cracks are visible. Denmark has a liberal view of individual autonomy and freedom, meaning the state cannot force individuals to accept housing, for example. Homelessness, particularly among individuals with psychiatric diagnoses, is a problem. VIVE, an independent research institution, estimated in 2015 that 80% of all homeless people in Denmark had a psychiatric diagnosis (VIVE 2015). There is a continuing debate on how best to address this problem.
Citations:
Statistics Denmark. 2023. “Indkomstulighed.” https://www.dst.dk/da/Statistik/emner/arbejde-og-indkomst/indkomst-og-loen/indkomstulighed
VIVE. 2015. “Hjemløshed kommer sjældent alene.” https://www.vive.dk/da/udgivelser/hjemloeshed-kommer-sjaeldent-alene-5xpqy5v7/
Municipalities and other public institutions provide assistance to elderly citizens in learning how to access municipal and public services through the online system MitID, the portal for contacting the welfare state. Computers are available at all municipal libraries. Students and pensioners receive subsidies for public transportation, resulting in very low rates for monthly passes.
Despite the comprehensive welfare state, some cracks are visible. Denmark has a liberal view of individual autonomy and freedom, meaning the state cannot force individuals to accept housing, for example. Homelessness, particularly among individuals with psychiatric diagnoses, is a problem. VIVE, an independent research institution, estimated in 2015 that 80% of all homeless people in Denmark had a psychiatric diagnosis (VIVE 2015). There is a continuing debate on how best to address this problem.
Citations:
Statistics Denmark. 2023. “Indkomstulighed.” https://www.dst.dk/da/Statistik/emner/arbejde-og-indkomst/indkomst-og-loen/indkomstulighed
VIVE. 2015. “Hjemløshed kommer sjældent alene.” https://www.vive.dk/da/udgivelser/hjemloeshed-kommer-sjaeldent-alene-5xpqy5v7/
Graph View
To what extent does current health policy hinder or facilitate health system resilience?
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Health policies are fully aligned with the goal of achieving a resilient health system.
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Health policies are largely aligned with the goal of achieving a resilient health system.
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Health policies are only somewhat aligned with the goal of achieving a resilient health system.
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Health policies are not at all aligned with the goal of achieving a resilient health system.
There is a universal entitlement to healthcare for all citizens, regardless of economic circumstance. Services are offered “free of charge,” and elected regional councils have governed the sector since 2007.
The establishment of large centralized hospitals, as opposed to those administered regionally, has faced considerable contention. Issues such as unresolved problems with electronic patient records persist. The debate about bringing basic healthcare activities closer to the population through local healthcare centers is ongoing, and the government has taken steps in this direction.
Recently, there has been considerable public debate about the quality of hospital services. Rising medicine prices are putting pressure on the financing of healthcare. One recent priority has been cancer treatment, an area in which Denmark has been lagging behind comparable countries. The Commission on the Healthcare System in Denmark argues that the healthcare system faces three major challenges.
First, the system is confronting an aging population at the same time that the labor force is shrinking. This is expected to lead to a shortage of personnel at all levels in healthcare provision. Second, the commission argues there is insufficient communication across administrative levels responsible for care. When a patient leaves specialized treatment in a hospital, which is under the responsibility of the regions, information and care are lost in the handover to the municipalities. This is partly due to incompatible IT systems. Thus, the commission recommends that the system should be unified. Third, the commission finds significant differences in healthcare provision across regions, linked to the pattern that doctors are unwilling to settle in areas outside the bigger cities and towns (Commission of the Healthcare System in Denmark 2023).
Citations:
Commission of the Healthcare System in Denmark. 2023. “Challenges to the Danish Health Care System.” https://sum.dk/Media/638375378820897110/Sundhedsv%C3%A6senets-udfordringer-STRUK.pdf
The establishment of large centralized hospitals, as opposed to those administered regionally, has faced considerable contention. Issues such as unresolved problems with electronic patient records persist. The debate about bringing basic healthcare activities closer to the population through local healthcare centers is ongoing, and the government has taken steps in this direction.
Recently, there has been considerable public debate about the quality of hospital services. Rising medicine prices are putting pressure on the financing of healthcare. One recent priority has been cancer treatment, an area in which Denmark has been lagging behind comparable countries. The Commission on the Healthcare System in Denmark argues that the healthcare system faces three major challenges.
First, the system is confronting an aging population at the same time that the labor force is shrinking. This is expected to lead to a shortage of personnel at all levels in healthcare provision. Second, the commission argues there is insufficient communication across administrative levels responsible for care. When a patient leaves specialized treatment in a hospital, which is under the responsibility of the regions, information and care are lost in the handover to the municipalities. This is partly due to incompatible IT systems. Thus, the commission recommends that the system should be unified. Third, the commission finds significant differences in healthcare provision across regions, linked to the pattern that doctors are unwilling to settle in areas outside the bigger cities and towns (Commission of the Healthcare System in Denmark 2023).
Citations:
Commission of the Healthcare System in Denmark. 2023. “Challenges to the Danish Health Care System.” https://sum.dk/Media/638375378820897110/Sundhedsv%C3%A6senets-udfordringer-STRUK.pdf
To what extent does current health policy hinder or facilitate achieving high-quality healthcare?
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Health policies are fully aligned with the goal of achieving high-quality healthcare.
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Health policies are largely aligned with the goal of achieving high-quality healthcare.
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Health policies are only somewhat aligned with the goal of achieving high-quality healthcare.
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1
Health policies are not at all aligned with the goal of achieving high-quality healthcare.
The Ministry of the Interior and Health (2023) reports that hospitals face serious challenges in meeting legally required treatment guarantees, which means healthcare may not be provided in a timely fashion. This is partly due to the structure of the healthcare system. Regions are responsible for hospitals and specialized care, while municipalities handle post-hospitalization care. This division leads to budgetary disputes over who should bear the cost of treatment.
To enhance the quality of treatment, the recent government has pursued a strategy of consolidating care into fewer so-called super-hospitals. The main idea behind this consolidation is that some treatments require a high degree of specialization and expertise that cannot be obtained in smaller units. However, creating super-hospitals has significantly increased the distance to a hospital in some parts of the country.
Recently, a scandal at several hospitals regarding the treatment of cancer patients revealed that hospitals are strained and unable to treat patients promptly (Danish Broadcasting System 2023). This scandal has sparked a debate over whether the legally guaranteed treatment times should be abolished. Some medical experts argue that these treatment guarantees make the healthcare system inflexible and shift the focus from treating the patients most in need to treating patients merely to avoid breaching the treatment guarantees.
The current government has passed several so-called prevention packages, ranging from a plan to reduce the overconsumption of alcohol by Danish teenagers and the provision of healthy school meals to better psychiatric treatment in general (Ministry of the Interior and Health 2023).
Citations:
Danish Broadcasting System. 2023. “Her er afsløringerne, der fik kræftskandalen på Aarhus Universitetshospital til at rulle.” https://www.dr.dk/nyheder/indland/her-er-afsloeringerne-der-fik-kraeftskandalen-paa-aarhus-universitetshospital-til
Ministry of the Interior and Health. 2023. “Forebyggelsespakker.” https://sum.dk/sundhed/forebyggelse/forebyggelsespakker
To enhance the quality of treatment, the recent government has pursued a strategy of consolidating care into fewer so-called super-hospitals. The main idea behind this consolidation is that some treatments require a high degree of specialization and expertise that cannot be obtained in smaller units. However, creating super-hospitals has significantly increased the distance to a hospital in some parts of the country.
Recently, a scandal at several hospitals regarding the treatment of cancer patients revealed that hospitals are strained and unable to treat patients promptly (Danish Broadcasting System 2023). This scandal has sparked a debate over whether the legally guaranteed treatment times should be abolished. Some medical experts argue that these treatment guarantees make the healthcare system inflexible and shift the focus from treating the patients most in need to treating patients merely to avoid breaching the treatment guarantees.
The current government has passed several so-called prevention packages, ranging from a plan to reduce the overconsumption of alcohol by Danish teenagers and the provision of healthy school meals to better psychiatric treatment in general (Ministry of the Interior and Health 2023).
Citations:
Danish Broadcasting System. 2023. “Her er afsløringerne, der fik kræftskandalen på Aarhus Universitetshospital til at rulle.” https://www.dr.dk/nyheder/indland/her-er-afsloeringerne-der-fik-kraeftskandalen-paa-aarhus-universitetshospital-til
Ministry of the Interior and Health. 2023. “Forebyggelsespakker.” https://sum.dk/sundhed/forebyggelse/forebyggelsespakker
To what extent does current health policy hinder or facilitate equitable access to high-quality healthcare?
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9
Health policies are fully aligned with the goal of achieving equitable access to high-quality healthcare.
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Health policies are largely aligned with the goal of achieving equitable access to high-quality healthcare.
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Health policies are only somewhat aligned with the goal of achieving equitable access to high-quality healthcare.
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1
Health policies are not at all aligned with the goal of achieving equitable access to high-quality healthcare.
The Danish healthcare system is universal and provides healthcare to all citizens. The system is based on the premise of equity in healthcare provision. Essential healthcare is available in all regions of the country, but the Ministry of the Interior and Healthcare is concerned that doctors and other healthcare staff cannot be recruited in the low-population parts of the country (Ministry of the Interior and Healthcare 2023).
The lack of trained personnel has the potential to create unequal access to healthcare across different regions.
Several governments have pursued a strategy of consolidating treatments in so-called super-hospitals to offer specialized care that requires high levels of expertise. The cost of this consolidation is that distances to hospitals have increased significantly in parts of the country. To remedy this issue, the current government has proposed establishing 21 hospitals that offer fewer treatments than the super-hospitals, but are closer to local communities. According to the plan, these hospitals will be built starting in 2024. The staff-shortage problems are not alleviated by building more hospitals, however.
Citations:
Ministry of the Interior and Healthcare. 2023. “Udfordringer i Sundhedsvæsnet.” https://sum.dk/nyheder/2023/december/analyse-sundhedsvaesenets-udfordringer
The lack of trained personnel has the potential to create unequal access to healthcare across different regions.
Several governments have pursued a strategy of consolidating treatments in so-called super-hospitals to offer specialized care that requires high levels of expertise. The cost of this consolidation is that distances to hospitals have increased significantly in parts of the country. To remedy this issue, the current government has proposed establishing 21 hospitals that offer fewer treatments than the super-hospitals, but are closer to local communities. According to the plan, these hospitals will be built starting in 2024. The staff-shortage problems are not alleviated by building more hospitals, however.
Citations:
Ministry of the Interior and Healthcare. 2023. “Udfordringer i Sundhedsvæsnet.” https://sum.dk/nyheder/2023/december/analyse-sundhedsvaesenets-udfordringer
Graph View
How committed is the government to ensuring gender equality in all respects?
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The government is clearly committed to the goal of ensuring gender equality.
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The government is largely committed to the goal of ensuring gender equality.
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The government is only somewhat committed to the goal of ensuring gender equality.
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The government is not at all committed to the goal of ensuring gender equality.
Denmark is one of the most gender-equal countries in the world. Gender-based discrimination can take various forms and be perceived differently depending on position, history and social context. Although employment rates for men and women are high, there is a clear gender division both horizontally and vertically. Women are overrepresented in welfare jobs in the public sector, and underrepresented among leaders in various fields.
The debate on gender-based discrimination in the labor market primarily focuses on wages, but it also encompasses hiring and career options. While a significant portion of the pay disparities between genders can be attributed to these factors, a pay difference of 1% – 3% persists, which may be attributed to other factors, including gender. Rules for parental leave have been expanded to extend the right and duty of fathers to take paternity leave. Since 2006, all employers have been required to contribute to the financing of parental leave schemes. A recent law changes how parents can split the leave, in an effort to encourage men to expand their share.
The Ministry of Digital Government and Gender Equality is responsible for proposing policies that enhance gender equality and for monitoring their development.
The share of women parliamentarians has been increasing since 1987; currently, 43% of legislators are women. In the present government, 35% of the ministers are women (Statistics Denmark 2023). At the municipal level, 36% of elected city counselors are women, and approximately 22% of mayors are women (Statistics Denmark 2021). The private sector lags somewhat behind these numbers. Approximately 15% of companies with more than 50 employees have a woman CEO, according to Danish Industry (2021). There is significant variation across sectors with regard to the share of women CEOs.
Citations:
Statistics Denmark. 2023. “Flere kvinder i Folketinget.” https://www.dst.dk/da/Statistik/nyheder-analyser-publ/bagtal/2023/2023-03-08-flere-kvinder-i-Folketinget
Statistics Denmark. 2021. “Komunalvalg.” https://www.dst.dk/da/Statistik/emner/borgere/demokrati/kommunalvalg
Lønstrukturkomiteen. 2023. Lønstrukturkomiteen - hovedrapport. København.
https://www.loenstrukturkomiteen.dk/media/0kulvbhr/loenstrukturkomite-ns-hovedrapport.pdf
The debate on gender-based discrimination in the labor market primarily focuses on wages, but it also encompasses hiring and career options. While a significant portion of the pay disparities between genders can be attributed to these factors, a pay difference of 1% – 3% persists, which may be attributed to other factors, including gender. Rules for parental leave have been expanded to extend the right and duty of fathers to take paternity leave. Since 2006, all employers have been required to contribute to the financing of parental leave schemes. A recent law changes how parents can split the leave, in an effort to encourage men to expand their share.
The Ministry of Digital Government and Gender Equality is responsible for proposing policies that enhance gender equality and for monitoring their development.
The share of women parliamentarians has been increasing since 1987; currently, 43% of legislators are women. In the present government, 35% of the ministers are women (Statistics Denmark 2023). At the municipal level, 36% of elected city counselors are women, and approximately 22% of mayors are women (Statistics Denmark 2021). The private sector lags somewhat behind these numbers. Approximately 15% of companies with more than 50 employees have a woman CEO, according to Danish Industry (2021). There is significant variation across sectors with regard to the share of women CEOs.
Citations:
Statistics Denmark. 2023. “Flere kvinder i Folketinget.” https://www.dst.dk/da/Statistik/nyheder-analyser-publ/bagtal/2023/2023-03-08-flere-kvinder-i-Folketinget
Statistics Denmark. 2021. “Komunalvalg.” https://www.dst.dk/da/Statistik/emner/borgere/demokrati/kommunalvalg
Lønstrukturkomiteen. 2023. Lønstrukturkomiteen - hovedrapport. København.
https://www.loenstrukturkomiteen.dk/media/0kulvbhr/loenstrukturkomite-ns-hovedrapport.pdf
Graph View
To what extent does the current family policy approach support or hinder unpaid family care work?
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Family policies are fully aligned with the goal of creating the conditions for strong families.
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Family policies are largely aligned with the goal of creating the conditions for strong families.
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Family policies are only somewhat aligned with the goal of creating the conditions for strong families.
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Family policies are not at all aligned with the goal of creating family-friendly conditions.
By international comparison, Denmark excels in its family policy. Daycare centers, preschools and kindergartens offer parents the flexibility needed to work. In fact, the female employment rate in Denmark is among the OECD’s highest. Comparative research indicates that Danish men do more household work than their counterparts in many other countries. Danes view daycare and preschool facilities as essential public services, and recent debates have raised questions about whether work-life balance can be improved.
The system of parental leave in connection with childbirth is relatively generous. Men also have parental leave rights. Municipalities are responsible for daycare facilities, which can be either public or private. These facilities contribute to improving the work-life balance. Social parties and businesses also play a role in this field. The government has sought to increase the number of employees per child for such facilities, resulting in a proposal that increases spending by DKK 1.4 billion through 2024.
The great majority of children attend daycare facilities in Denmark. In 2022, about 70% of children aged two and under were in daycare, the highest such rate in the OECD. Approximately 95% of children aged three to five attended some kind of preschool institution (Statistics Denmark 2023). There is a user payment for daycare – means tested – but it does not cover the full cost, so the system is tax-subsidized. There are substantial differences in the fees paid to have a child in kindergarten across municipalities.
Citations:
Statistics Denmark. 2023. “Børnepasning før skolestart.” https://www.dst.dk/da/Statistik/dokumentation/statistikdokumentation/boernepasning-foer-skolestart
The system of parental leave in connection with childbirth is relatively generous. Men also have parental leave rights. Municipalities are responsible for daycare facilities, which can be either public or private. These facilities contribute to improving the work-life balance. Social parties and businesses also play a role in this field. The government has sought to increase the number of employees per child for such facilities, resulting in a proposal that increases spending by DKK 1.4 billion through 2024.
The great majority of children attend daycare facilities in Denmark. In 2022, about 70% of children aged two and under were in daycare, the highest such rate in the OECD. Approximately 95% of children aged three to five attended some kind of preschool institution (Statistics Denmark 2023). There is a user payment for daycare – means tested – but it does not cover the full cost, so the system is tax-subsidized. There are substantial differences in the fees paid to have a child in kindergarten across municipalities.
Citations:
Statistics Denmark. 2023. “Børnepasning før skolestart.” https://www.dst.dk/da/Statistik/dokumentation/statistikdokumentation/boernepasning-foer-skolestart
Graph View
To what extent does the current pension policy approach prevent poverty among senior citizens?
10
9
9
Pension policies are fully aligned with the goal of preventing old-age poverty.
8
7
6
7
6
Pension policies are largely aligned with the goal of preventing old-age poverty.
5
4
3
4
3
Pension policies are only somewhat aligned with the goal of preventing old-age poverty.
2
1
1
Pension policies are not at all aligned with the goal of preventing old-age poverty.
The Danish pension system is well-structured in accordance with the World Bank’s three-pillar conceptual framework. The first pillar is a tax-financed universal base pension with means-tested supplements. This pillar includes Denmark’s ATP pension scheme, which is a mandatory-funded defined benefits scheme. The second pillar comprises occupational pensions agreed as part of collective agreements and firm-specific pension schemes. These are contribution-based programs. Contribution rates are in the range of 12% to 18% for most employees. The third pillar involves tax-subsidized pension arrangements (with funds unavailable until retirement) offered by insurance companies, pension funds and banks as well as other forms of savings (for most households in the form of housing wealth). The combination of the different pillars of the pension scheme ensures protection against low income for the elderly (distributional objective) as well as a pension which is reasonable in relation to the income earned when the pensioner was active in the labor market (high replacement rates) (OECD 2023). The Danish pension scheme has for several years ranked in the top of the Melbourne Mercer Global Pension Index. The main challenges involve the complexity of the system, the possible disincentive effects on savings and retirement arising from the means testing of public pensions, and the problem of citizens outside the mandatory labor market pensions (the “residual” pension group).
Statutory ages in the pension system (in public pensions for early retirement and age limits for payment of funds from pension schemes) are established by legislation. Recent reforms – the 2006 welfare reform and the 2011 retirement reform – increased these ages considerably to cope with the aging population. First, the retirement age (early retirement and pensions) has been gradually increased and the early retirement period reduced from five to three years. Second, the statutory pension/retirement age is linked (indexed) to developments in life expectancy at the age of 60 such that the expected pension period will become 14.5 years (17.5 including early retirement) over the long run (currently, the expected pension period is between 18.5 and 23.5 years). The statutory retirement age is increased every fifth year (with a 15 years lead time). The latest increase in 2021 (applying from 2035) implies a statutory pension age of 70. A particular challenge involves how to allow people to opt out of the labor market if their health or ability to work makes it impossible to postpone retirement in concert with the general upward trend in the pension age. There are three options: The first involves taking early retirement, which is a contribution-based system allowing the eligible person to retire within a window of three years prior to the statutory pension age; the second involves receiving a senior pension, which depends on the assessed work capability; and the third involves receiving an early pension, which was recently introduced and allows those with a long career behind them the option of retiring one to three years earlier.
Citations:
Andersen, T.M., S.E. Hougaard Jensen, and J. Rangvid, eds. 2022. The Danish Pension System – Design, Performance, and Challenges. Oxford: Oxford University Press.
OECD. 2023. Pensions at a Glance 2023: OECD and G20 Indicators. Paris: OECD Publishing. https://doi.org/10.1787/678055dd-en
Statutory ages in the pension system (in public pensions for early retirement and age limits for payment of funds from pension schemes) are established by legislation. Recent reforms – the 2006 welfare reform and the 2011 retirement reform – increased these ages considerably to cope with the aging population. First, the retirement age (early retirement and pensions) has been gradually increased and the early retirement period reduced from five to three years. Second, the statutory pension/retirement age is linked (indexed) to developments in life expectancy at the age of 60 such that the expected pension period will become 14.5 years (17.5 including early retirement) over the long run (currently, the expected pension period is between 18.5 and 23.5 years). The statutory retirement age is increased every fifth year (with a 15 years lead time). The latest increase in 2021 (applying from 2035) implies a statutory pension age of 70. A particular challenge involves how to allow people to opt out of the labor market if their health or ability to work makes it impossible to postpone retirement in concert with the general upward trend in the pension age. There are three options: The first involves taking early retirement, which is a contribution-based system allowing the eligible person to retire within a window of three years prior to the statutory pension age; the second involves receiving a senior pension, which depends on the assessed work capability; and the third involves receiving an early pension, which was recently introduced and allows those with a long career behind them the option of retiring one to three years earlier.
Citations:
Andersen, T.M., S.E. Hougaard Jensen, and J. Rangvid, eds. 2022. The Danish Pension System – Design, Performance, and Challenges. Oxford: Oxford University Press.
OECD. 2023. Pensions at a Glance 2023: OECD and G20 Indicators. Paris: OECD Publishing. https://doi.org/10.1787/678055dd-en
To what extent does the current pension policy approach hinder or promote intergenerational equity?
10
9
9
Pension policies are fully aligned with the goal of achieving intergenerational equity.
8
7
6
7
6
Pension policies are largely aligned with the goal of achieving intergenerational equity.
5
4
3
4
3
Pension policies are only somewhat aligned with the goal of achieving intergenerational equity.
2
1
1
Pension policies are not at all aligned with the goal of achieving intergenerational equity.
One challenge in the Danish system is that means testing of public pension protection leads to a lower level of income for all pensioners. This implies that the economic gain from postponing retirement may be low for groups affected by means testing. To address this problem, recent reforms of the tax system have strengthened incentives to save and postpone retirement. Retirement ages remain significantly influenced by the statutory retirement age, which has been increased incrementally and is now indexed to longevity developments.
There is an ongoing discussion about whether indexation based on an absolute target of 14.5 years in retirement (excluding early retirement) is too strict, and whether it should be replaced by a relative target (an extra expected life-year being split between a fraction of 0.8 in work and 0.2 in retirement). Indexation of retirement is a crucial reason why fiscal policy in Denmark is sustainable.
Recent initiatives have strengthened the incentive to postpone retirement through senior premiums for individuals working beyond the statutory retirement age, revisions to the means testing of pensions to make them less dependent on partner income and an earned-income tax credit for seniors.
The Danish pension system stands out by preventing poverty among pensioners while also ensuring high replacement rates for a large part of the population.
Citations:
Commission on Withdrawal from and Attrition in the Danish Labour Market. 2022. A Robust Pension System Denmark in the Future. https://bm.dk/media/20703/fremtidssikring-af-et-staerkt-pensionssystem.pdf
There is an ongoing discussion about whether indexation based on an absolute target of 14.5 years in retirement (excluding early retirement) is too strict, and whether it should be replaced by a relative target (an extra expected life-year being split between a fraction of 0.8 in work and 0.2 in retirement). Indexation of retirement is a crucial reason why fiscal policy in Denmark is sustainable.
Recent initiatives have strengthened the incentive to postpone retirement through senior premiums for individuals working beyond the statutory retirement age, revisions to the means testing of pensions to make them less dependent on partner income and an earned-income tax credit for seniors.
The Danish pension system stands out by preventing poverty among pensioners while also ensuring high replacement rates for a large part of the population.
Citations:
Commission on Withdrawal from and Attrition in the Danish Labour Market. 2022. A Robust Pension System Denmark in the Future. https://bm.dk/media/20703/fremtidssikring-af-et-staerkt-pensionssystem.pdf
Graph View
To what extent does the current policy approach hinder or facilitate the inclusion of migrants into society and the labor market?
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9
9
Integration policies are fully aligned with achieving the sustainable inclusion of migrants in society.
8
7
6
7
6
Integration policies are largely aligned with achieving the sustainable inclusion of migrants in society.
5
4
3
4
3
Integration policies are only somewhat aligned with achieving the sustainable inclusion of migrants in society.
2
1
1
Integration policies are not at all aligned with achieving the sustainable inclusion of migrants in society.
On 1 July 2020, approximately 814,000 immigrants and descendants of immigrants lived in Denmark, accounting for 13.8% of the population (9% immigrants, 5% descendants). Roughly two-thirds of these immigrants were from non-Western countries.
Immigration rules have tightened since 2002, including the family reunification rule introduced in 2004. Since peaking in 2015, immigration from countries outside the European Union has fallen, while immigration from within the European Union for work remains significant. The employment rate among immigrants and their descendants aged 16 to 64 is low compared to other groups, though it has been increasing in recent years. Consequently, there is a substantial employment gap when considering age distribution and qualifications.
Immigrants from non-Western countries had an employment rate 22% lower than that of ethnic Danes in 2020 (for descendants, the gap is 16%). The gap is higher for women (24%) than for men (19%). For immigrants from Western countries, the gap is about 11% (for descendants, about 6%). These gaps in employment rates should be viewed in light of Denmark’s high employment rates for both men and women, the high qualification requirements for securing a job and the high minimum wage.
The inclusion of immigrants in the labor market has improved somewhat because the Danish labor market has proven very strong, attracting a large inflow of migrant workers. However, a concern remains that if the economy slows down, the first to lose their jobs would likely be non-Western immigrants (Statistics Denmark 2023).
An increasing share of immigrants report feeling more integrated and having more Danish friends, with fewer experiencing discrimination. Additionally, more immigrants than ever before now speak Danish. Within three years of arrival, half of all male refugees are employed, and the children of refugees are integrating into Danish schools faster than in the past.
Concerning educational achievements, immigrants and their descendants – especially girls – are making progress. Among those aged 25 to 34, 80% of women with Danish ethnicity and 67% of women with a foreign background have completed secondary education. For men, the figures are 73% with Danish ethnicity and 49% with a foreign background.
There is broad political support for tight immigration policies, and various measures have been introduced in recent years to reduce immigration, including family unification. The conditions of temporary residency permits are being reassessed, and discussions are ongoing about the scope allowed to temporary residents to return to their home countries. These measures should be viewed alongside changes to the social safety net and reduced transfers to immigrants.
Denmark has stopped receiving quota refugees through the United Nations, even though some municipalities had indicated they were ready to accept more. The Social Democratic Party has committed to a strict immigration policy, which allowed it to capture votes from the Danish People’s Party. However, other parties in the “red” block, especially the Social Liberals, favor a more liberal immigration policy.
Citations:
Statistics Denmark. 2023. “Stigende beskæftigelse for ikke-vestlige efterkommere.” https://www.dst.dk/da/Statistik/nyheder-analyser-publ/nyt/NytHtml?cid=47918
Immigration rules have tightened since 2002, including the family reunification rule introduced in 2004. Since peaking in 2015, immigration from countries outside the European Union has fallen, while immigration from within the European Union for work remains significant. The employment rate among immigrants and their descendants aged 16 to 64 is low compared to other groups, though it has been increasing in recent years. Consequently, there is a substantial employment gap when considering age distribution and qualifications.
Immigrants from non-Western countries had an employment rate 22% lower than that of ethnic Danes in 2020 (for descendants, the gap is 16%). The gap is higher for women (24%) than for men (19%). For immigrants from Western countries, the gap is about 11% (for descendants, about 6%). These gaps in employment rates should be viewed in light of Denmark’s high employment rates for both men and women, the high qualification requirements for securing a job and the high minimum wage.
The inclusion of immigrants in the labor market has improved somewhat because the Danish labor market has proven very strong, attracting a large inflow of migrant workers. However, a concern remains that if the economy slows down, the first to lose their jobs would likely be non-Western immigrants (Statistics Denmark 2023).
An increasing share of immigrants report feeling more integrated and having more Danish friends, with fewer experiencing discrimination. Additionally, more immigrants than ever before now speak Danish. Within three years of arrival, half of all male refugees are employed, and the children of refugees are integrating into Danish schools faster than in the past.
Concerning educational achievements, immigrants and their descendants – especially girls – are making progress. Among those aged 25 to 34, 80% of women with Danish ethnicity and 67% of women with a foreign background have completed secondary education. For men, the figures are 73% with Danish ethnicity and 49% with a foreign background.
There is broad political support for tight immigration policies, and various measures have been introduced in recent years to reduce immigration, including family unification. The conditions of temporary residency permits are being reassessed, and discussions are ongoing about the scope allowed to temporary residents to return to their home countries. These measures should be viewed alongside changes to the social safety net and reduced transfers to immigrants.
Denmark has stopped receiving quota refugees through the United Nations, even though some municipalities had indicated they were ready to accept more. The Social Democratic Party has committed to a strict immigration policy, which allowed it to capture votes from the Danish People’s Party. However, other parties in the “red” block, especially the Social Liberals, favor a more liberal immigration policy.
Citations:
Statistics Denmark. 2023. “Stigende beskæftigelse for ikke-vestlige efterkommere.” https://www.dst.dk/da/Statistik/nyheder-analyser-publ/nyt/NytHtml?cid=47918
Graph View
How committed is the government to helping build the capacity to reduce poverty and provide social protection in low- and middle-income countries?
10
9
9
The government’s development cooperation strategy is fully aligned with the goal of improving capacity-building for poverty reduction in low- and middle-income countries.
8
7
6
7
6
The government’s development cooperation strategy is largely aligned with the goal of improving capacity-building for poverty reduction in low- and middle-income countries.
5
4
3
4
3
The government’s development cooperation strategy is only somewhat aligned with the goal of improving capacity-building in poverty reduction in low- and middle-income countries.
2
1
1
The government’s development cooperation strategy is not all aligned with the goal of improving capacity-building for poverty reduction in low- and middle-income countries.
Assisting developing countries has broad support among Danish voters. Denmark is one of only five countries in the world that meet the UN target of 0.7% of gross national income (GNI) for development assistance, although it has fallen slightly behind this target in recent years. Some of the funds have been redirected to address the increasing inflow of asylum-seekers.
Denmark is increasing its focus on regions in the Middle East and Africa where many refugees originate. The country is not planning to reduce its humanitarian aid. In May 2016, 40% of Danes felt it was very important to help people in developing countries, and 49% felt it was fairly important. During the great influx of refugees in September 2015, 30% of the Danish population supported giving more development aid, 35% supported providing the same amount and 28% supported giving less. Overall, there is relatively strong support for development aid in Denmark.
The government’s 2021 strategy for development cooperation – the World We Share – outlines the priorities in Danish development policy for the period 2021 – 2025 (Ministry of Foreign Affairs, 2021). The strategy emphasizes an increased focus on environmental issues and migration, including returning illegal migrants to their home countries; mobilizing private capital to increase development aid; and increasing support for multilateral efforts targeting women and girls’ sexual and reproductive health and rights.
About 70% of Denmark’s official development aid (ODA) is bilateral, while the remaining 30% is multilateral. Development policy is not a high priority in policy debates.
Citations:
Ministry of Foreign Affairs. 2021. “The World We Share – Denmark’s Strategy for Development Cooperation.” https://um.dk/en/-/media/websites/umen/danida/strategies-and-priorities/udviklingsstrategi_uk_web.ashx
Denmark is increasing its focus on regions in the Middle East and Africa where many refugees originate. The country is not planning to reduce its humanitarian aid. In May 2016, 40% of Danes felt it was very important to help people in developing countries, and 49% felt it was fairly important. During the great influx of refugees in September 2015, 30% of the Danish population supported giving more development aid, 35% supported providing the same amount and 28% supported giving less. Overall, there is relatively strong support for development aid in Denmark.
The government’s 2021 strategy for development cooperation – the World We Share – outlines the priorities in Danish development policy for the period 2021 – 2025 (Ministry of Foreign Affairs, 2021). The strategy emphasizes an increased focus on environmental issues and migration, including returning illegal migrants to their home countries; mobilizing private capital to increase development aid; and increasing support for multilateral efforts targeting women and girls’ sexual and reproductive health and rights.
About 70% of Denmark’s official development aid (ODA) is bilateral, while the remaining 30% is multilateral. Development policy is not a high priority in policy debates.
Citations:
Ministry of Foreign Affairs. 2021. “The World We Share – Denmark’s Strategy for Development Cooperation.” https://um.dk/en/-/media/websites/umen/danida/strategies-and-priorities/udviklingsstrategi_uk_web.ashx