and subsidiarity ruled out state administration and instead called for (pillarized) unions and
employer organizations to administer social insurance. Social democratic labor lost the first
battles over administration, and early social insurance legislation provided for (pillarized)
corporatist organization.
WWII marked a turning point in Dutch welfare state development. The government in
exile in London appointed a commission to plan for future social reforms, headed by a leading
Labor Party member (van Rijn). Mindful of the earlier rejection of universal social policy
(because it left little room for subsidiarity), the commission recommended, among other
things, universal social insurance. The state would play a more important role in
administration, but universal benefits would be contribution-financed in order to appease
confessional groups. The immediate postwar period saw a succession of "Red-Roman"
governments in which the Labor Party governed with the confessional parties. After the 1946
election, the Labor Party leader Drees served as Minister of Social Affairs. Conditions
seemed favorable for a switch to universal social insurance, but pillarization had survived the
war, and conservative confessional groups opposed Labor's social insurance reform plans,
especially for pensions.
Sickness insurance, accident insurance and unemployment insurance retained their
structure as worker insurances administered by corporatist organizations, but labor managed
to prevail in the area of pensions. The government secured adoption of an Emergency
Pensions Act in 1946 to serve as an interim measure until a permanent system could be
negotiated. The measure passed with the votes of the Catholic Party after the Labor Party
agreed to base the scheme on the insurance principle. The Emergency Act provided benefits
to all persons over 65, including those with occupational pensions. Despite the cooperation of
the Catholic Party, corporatist interests were divided, especially concerning administration.
However, the Emergency Act set in motion a process in which all citizens were entitled to a
public pension. Negotiations on permanent legislation dragged on for ten years, but the
Labor-controlled Ministry of Social Affairs finally prevailed, negotiating the provisions of the
permanent legislation with the newly created Social Economic Council (SER), a tripartite
corporatist advisory body. The Emergency pensions had been in effect for nearly ten years
and were very popular, prompting the Liberals and more moderate Catholics to side with
Labor. The new law, the AOW went into effect on January 1, 1957.
The essential point about this episode is that Labor wanted universal, flat-rate pensions
but had no strong preference on the issue of financing. Progressive confessional groups
insisted on designing the AOW as universal, flat-rate pension insurance which meant that it
would be financed by wage-earner contributions, and not general revenues or employer
contributions. This initial decision set in motion a cognitive process in which the public, and
9
Convention