Study on Distributional Impact Assessment

This study reviews the use of (ex-ante) Distributional Impact Assessment (DIA) in the budgetary processes in the EU Member States. DIA refers to the assessment of the impact of policies on the income distribution, poverty and income inequality. The study also provides suggestions for further increasing the use of DIA. Insights from this study support the preparation of the Commission’s guidance to Member States on making greater use of (ex-ante) DIA, as announced in the European Pillar of Social Rights Action Plan. In more detail: This study first presents to what extent and in what way EU Member States make use of (ex-ante) DIA for budgetary measures. It also identifies the main reasons limiting the use of DIA in the preparation of Draft Budgetary Plans (DBPs) and assesses the degree of similarity in the use of DIA among euro area Member States. The study shows that, even if most of the EU Member States performed at least some DIA in recent years for budgetary purposes, there is room for improvement in this respect and that euro area Member States rarely included DIA in their DBPs mostly due to organisational issues. To encourage the use of DIA as well as its inclusion in budgetary documents, such as the DBPs, the study then provides suggestions to both the European Commission and to the Member States aiming to help Member States to increase their use of DIA and ensure its relevance and quality.