Introduction

During the 1990s, Finland underwent considerable changes in the labour market and the social protection system. These changes brought increased uncertainty and individualisation of risk in the labour market, and a shift towards activation in social protection. Due to economic recession and difficulties in the state economy, cutbacks were introduced throughout the social security system in the early 1990s (Heikkilä and Uusitalo, 1997). These circumstances in part paved the way for the social policy reforms to follow. Even though the economy has recovered thereafter, unemployment has remained high on the political agenda (Kalela et al, 2001).

Since the mid-1990s, the political discourse has started to emphasise the individual responsibilities of unemployed people vis-à-vis structural factors. Increasingly, unemployment was no longer perceived as a consequence of economic development, but as being related to individual job-search activity and labour market attachment. The policy shift this brought about involved a number of activation policy reforms, which intended to make the service system more effective and to redefine benefit conditions. An activation requirement has been attached to the social assistance and the employment benefit systems, and the process of service provision has been reformed to reinforce active job search and individual activation of unemployed people.

In an activation reform introduced in 2001, Laki kuntouttavasta työtoiminnasta (Rehabilitative Work Experience Act), an attempt was made to combat long-term unemployment and the risk of social exclusion by means of a comprehensive activation strategy. In justifying the reform, reference was made to dissatisfaction with the quality and effectiveness of services and with the cooperation between administrations and agencies, but also to local variations in the activation efforts. The 2001 reform can be characterised as a centralised programme aimed at introducing a universal activation strategy, while implementation should simultaneously be directed by an individual approach. The core activation instrument is an individual activation plan that is to be developed with all young and long-term unemployed people who fulfil the age and benefit criteria as stipulated in the Act.

This chapter is based on an empirical analysis of the implementation of this reform. We are particularly interested in the intersections of redefining benefit conditions and reforming service structures, and their implications for individuals. The policy context and the development of activation policies in Finland is described and analysed, with specific attention to the 2001 activation reform.