This article examines recent changes in the German and Swedish welfare
states and argues that, in contrast to Great Britain, welfare institu
tions, characteristics and structures have remained fairly robust. Des
pite retrenchment and some substantial cuts, a shift away from traditi
onal welfare principles has not occurred. Indeed, it is likely that, a
t the start of the next millennium, social insurance will continue to
be the hallmark of the 'conservative' German welfare state, while Swed
en's welfare state remains basically a social democratic and solidaris
tic institution. The social, political and institutional reasons for t
his relative stability are discussed.