In the 1990s, there was a widespread belief in the inertia of the welfare state. In contrast, we now observe quite far-reaching changes in welfare policies, and several possible directions seem to be open for tomorrow's welfare states. In brief, we are in the midst of a thoroughgoing reform of welfare systems. Welfare policies are changing in response to new challenges, new actors and changing power relations. We also face new discourses about welfare that are disseminated across the rich welfare states.

Current conceptualisations and explanations of welfare state change are not always very helpful for analysing these often quite ambiguous changes. In the first place, explanations of changes have tended to focus too much on the problems of cost containment or competitiveness, failing to acknowledge other sources of change. Secondly, they have seen change too one-sidedly as a matter of retrenchment and failed to recognise that current changes also involve the expansion of social rights. Furthermore, the criteria used to assess change depend too much on the welfare state architecture that developed in the second half of the 20th century; in particular, they usually focus too narrowly on the state versus the market dichotomy, and too much on cash transfers rather than services. Finally, analyses of change often put too much emphasis on formal institutions and too little on outcomes.

Although analyses and interpretations along these lines have provided valuable insights, we must find a new vantage point for looking at the reforms under way and devise new standards of measurement for assessing current reforms and their eventual effects. In this book, we have suggested as a starting point for this analysis a broader notion of societal change; we have suggested assessing welfare reforms mainly from an outcome perspective and we have suggested focusing on the effects of such reforms on citizenship – while acknowledging at the same time that citizenship itself is being redefined.

Challenges and change: beyond retrenchment

During the 1990s, following Pierson's (1994) pioneering work, welfare state reform was mainly seen in terms of retrenchment. This view highlighted economic pressures as the major cause of change and provided extremely valuable insights into the politics of blame avoidance.