Underlying European Commission documents on social policy is the assumption that, as a result of common demographic trends, particularly population ageing, family and household change, all member states in the European Union (EU) are facing similar problems, for which they might be expected to adopt similar solutions through a process of policy learning and diffusion. Demographic trends are said to be driving policy (European Commission, 1995, 2002d, 2003). The 1994 White Paper on European social policy, which set out to offer a response to Europe's need for “a blueprint for the management of change”, explicitly recognised that “demography … will impact on and interrelate with social and economic policy”, acknowledging that “comparable trends … lead to common problems and challenges”, and hence to the need to develop common policy responses (COM(94) 333, 27.07.1994, pp 7, 47). At the heart of the 2000 social policy agenda was the modernisation of the European social model, which had the overall aim of strengthening the role of social protection as an effective tool for the management of change, thereby converting the political commitments made at the Lisbon European Council in 2000 into concrete action. Modernisation and improvement of social protection were central components in the response to the advent of the knowledge economy and to changing social and family structures, in a context where the quality of social policy was said to depend on social protection serving as a productive factor (European Commission, 2000b, p 19; 2002d, p 10).

Demographic trends are not, however, the only motivation for modernising social policy. A justification for introducing supportive public provision in the form of family allowances during the interwar and immediate postwar periods was to contain wage inflation. The early maternity leave schemes at the turn of the 20th century were primarily concerned with safeguarding the health of mothers and their children. The same argument was evoked in 1992 when maternity leave was incorporated into European law as a health and safety measure (Council Directive 92/85/EEC, Official Journal L 348/1, 28.11.1992). In the 1990s, a powerful incentive for governments to review their social policies was the need to control public spending if they were to meet the criteria for Economic and Monetary Union by reducing public sector borrowing without raising taxation.