The initial reaction ten years ago when news of the creation of the Idea Foundation broke was to say to ourselves: what kind of ‘thing’ is this that the Chamber of Commerce and employers are launching? Year after year, this ‘thing’ has gained--in the media, in public opinion and with the political authorities--the image of independence and an agitator of ideas.

Identifying the challenges

From the outset, the Idea Foundation has positioned itself as a think tank whose objective, “in complete autonomy and transparency,” says director Vincent Hein, was to fuel public debate, “to put forward and find solutions to the country’s major challenges. To dare to make diagnoses and also to put forward proposals.”

In terms of diagnosis, Idea has hit the nail on the head. “Our first publication was an analysis of growth in Luxembourg. If you look at the conclusions of that study today--which are still available on the Idea website--you realise just how many of the challenges we faced then are still very much with us today. Hardly any of them are out of date.” What applies to growth also applies to other issues such as competitiveness, attractiveness, nation branding and business transfers.

“We want to identify the major challenges facing the country. Those that are under-debated and that we are trying to highlight in the public debate and those that are over-debated, but not always from the right angles in terms of critical analysis and the ability to generate solutions. We also want to produce new economic knowledge and--this is our major difference from the scientific world--engage in public debate on it. Informing public debate is really central to the way we work.”

Laws made in Idea

To achieve this, the Idea Foundation has multiplied its formats in recent years. To sum up, in 10 years, Idea has produced 549 publications and 1,266 press articles. In concrete terms, some of the think tank’s ideas have been translated into law. This is the case with 9 May--Europe Day--which has become a public holiday. The idea was put forward by Michel-Edouaurd Ruben, a long-standing member of the foundation, in 2018.

Also in 2018, Idea launched the idea of a “€100 boost” to the minimum social wage. The legislature granted an increase of €106. And also in 2018--a successful year--the idea of adapting the tax regime applicable to impatriates was launched. This was transposed into law in 2021.

In 2020, Idea suggested tightening up the conditions for using meal vouchers to support the hotel and catering sector, a recommendation that was later introduced into law. The transfer of capital gains was also reintroduced, and other proposals have also found their way into the law. These include mobilising tax instruments to discourage the unproductive retention of property. This idea from 2016 was taken up in the Frieden government’s coalition agreement.

From intuition to practice

But this is only “the tip of the iceberg,” says Hein. Other proposals--“intuitions”--have become concrete practices without having to be transcribed into law. This was the case for the recommendations contained in Ruben’s working paper published at the start of the covid crisis: “Health first, then the economy.” Other recommendations that have led to concrete action include the proliferation of decentralised offices rented by companies for their employees to work in on an occasional or more frequent basis. It’s an idea from 2016.

Finally, other proposals continue to drive debate. Political parties have adopted certain ideas that have featured prominently in their programmes. Hein gives the following examples: the objective of cross-border co-development (LSAP); asserting the right to experiment in cross-border spatial planning (déi Gréng); integrating the Greater Region into territorial planning (CSV); tax on the holding of undeveloped land (CSV); strengthening coordination between spatial planning and the municipalities (LSAP); and support for mergers and regional inter-municipal cooperation (DP). “We put forward 50 proposals for the 2023 campaign. We met with most of the groups and factions represented in the Chamber of Deputies. Some have even received us several times.”

And then there are the two key issues of housing and pensions.

As far as housing is concerned, the Idea Foundation in 2019 published the highly prophetic “Housing in Luxembourg: is the worst to come?” report. Here we are. “We were the first to officially raise the question of whether housing policy should have the sole function of facilitating access to home ownership.”

As for the reform of Luxembourg’s pension schemes, Idea in 2017 published “a project that was practically delivered turnkey.” At the time, it noted that the scheme was generous and did not correct the inequalities that exist on the labour market. The report contained two sets of juicy figures: the return on the pension system--i.e., the ratio between contributions paid and benefits received--varied between 6.45% and 7.45%, depending on pensioners’ earned income. Enough to make the banks blush. All the more so as the payback period--i.e., the point at which you receive what you have paid in--varied between 68 and 79 months.

Credibility, urbi et orbi

What Hein is most proud of is the credibility he has acquired--“a credibility that we have to maintain on a daily basis.” “We are increasingly called upon when there are major strategic thinking initiatives in the country. Luxembourg Stratégie contacted us to be part of a scientific committee for Luxembourg in transition, its major initiative on spatial planning. We were also approached by the minister for health and social security about pension reform. And we receive many regular requests from political decision-makers and civil servants to discuss topical issues.”

This credibility extends beyond the borders of Luxembourg, into the Greater Region and beyond. “More and more experts are contacting us to ask for our point of view on a subject and, in return, when we call on outside experts, we are no longer turned down.”

Over the next six months, the Idea Foundation will be returning to the issue of pensions with a series of four studies. The first two will diagnose the viability of the system and the cost of reform, depending on whether it is carried out sooner or later. A third study will list some thirty possible avenues for reform, drawing inspiration from other systems in Europe. And finally, Idea will conclude with a fourth study proposing one or more reform scenarios. “There really are several possible combinations in this area.”

“The aim is not to be right, but to fuel the debate. All our ideas are aimed at improving prosperity, competitiveness, attractiveness and social cohesion in Luxembourg. We’d like to be challenged on all these issues,” concludes Hein, for whom there is room in Luxembourg for other think tanks and more intellectual emulation.

This article was originally published in .