Opening Speech by Governor Carlo Monticelli at CEB's 70th anniversary in Warsaw, Poland

As prepared for delivery

Minister of Finance and Economy of Poland, Mr Dománski,

Director-General of Human Rights and Rule of Law at the Council of Europe,

Chairpersons and Members of the Governing Board and Administrative Council,

Distinguished guests,

Ladies and Gentlemen,

As the Council of Europe Development Bank marks its seventieth anniversary, it is worth reflecting on the reasons why social investment has mattered in Europe – and why it matters today with renewed urgency.

The Bank’s roots can be found in the aftermath of the Second World War – a conflict that left Europe devastated, politically fragile, fragmented, torn by antagonistic political systems. Entire populations had been uprooted. Economies were shattered. Institutions were being rebuilt from the ground up.

The CEB was established to sustain that effort, in particular by supporting the resettlement of displaced populations and helping restore ruptured social stability.

Europe’s social needs evolved. The Bank evolved with it, expanding its role to finance housing, health, education and financial inclusion as central pillars of social cohesion and democratic stability.

Today, Europe is once again operating in a context of fracture.

The current disruption takes a different form. It is driven by a global geopolitical shock which is reshaping international relations by disavowing the multilateral, rule-based order that had underpinned the mightiest creation of wealth and welfare in the history of humankind.

International cooperation is weakening. Multilateral institutions are losing endorsement and grip. Nationalism, and its villainous twin, protectionism, are on the rise. Development gaps are widening. The calamitous economic consequences are already visible – and they seem set to deepen.

Unlike the financial crisis or the COVID-19 pandemic – severe though they were – this shift is broader and more structural, since no new global order is in sight. The transformation reaches into our economies, trade relations, and security. It is redefining the conditions under which our societies function.

One of the most visible consequences has been rising economic insecurity. Energy shocks, job dislocation and displacement, combined with a sustained rise in the cost of living, have affected millions of households across Europe, straining social cohesion.

But, as with any major disruption, the burden has not been evenly shared. Those already exposed to poverty, exclusion or weak access to services have been hit hardest.

While economic insecurity is intensifying, the broader international context is reshaping public priorities. Security concerns, understandably, command greater attention, crowding out other sectors, including social investment. As a result, the allocation of public resources is already changing.

In many countries, this has increased the need for social spending precisely at the moment when the fiscal space is limited.

That combination is malignant for the welfare of societies and their inclusiveness.

Taken together, the two trends place sustained stress on Europe’s social fabric, compounding existing pressures already created by demographic, technological and climate transitions, as well as from Russia’s war of aggression against Ukraine.

The intense strain shapes the way Europeans perceive the outlook for the future. Almost half report greater difficulty than their parents’ generation in having access to stable employment, decent housing and healthcare. An even larger share doubt that their prospects will improve for the next generation.[1]

When confidence in access to life’s essentials and availability of opportunities to improve one’s station deteriorates, social cohesion sags. Despair is rife.

Trust in institutions wavers. Public debate hardens. The capacity to manage change and sustain adjustment dwindles. Resilience crumbles.

In Europe, cohesion and resilience traditionally hinge on the mutual and broad sharing of risks and opportunities – underpinned by the safety net of (quasi) universal access to healthcare, education, housing and job opportunities.

Social investment is one of the core instruments to maintain this model.

By sustaining housing, health, education and social services, it keeps people connected – to the labour market, to their communities, to public life. It facilitates the smooth adjustment to shocks and cushions the burden on those least able to bear it.

This is why social investment carries the characteristics of a public good. It allows labour markets to become more resilient, productivity growth to rest on stronger foundations, and institutions to retain legitimacy.

The key challenge now –, as it was in previous junctures of systemic disruption – is thus to ensure that adequate resources for social investment remain available and are allocated where difficulties are more intense.

It is at the local level, where social services and people meet, that the pressure is felt the most. Local authorities, civil society organisations and social-economy actors are typically the first to confront strain and disruption. Their capacity to act determines whether communities manage to be resilient.

The CEB supports their capability to respond by financing concrete projects across all levels of government, and by working with trusted local partners closest to the people who are to be supported. Proximity helps ensure that CEB financing is directed to those most in need, delivering where pressure is felt the most.

* * *

Ladies and Gentlemen, sustaining this effort is key for Europe’s future, for its peace and prosperity, as public finances come under greater strain.

The task now is to use resources better – and together. Multilateral and public development banks, national and European institutions, private capital each bring complementary strengths. Joining forces in a common effort, they – WE – can maximise the resources available for social investment and strengthen their impact.

Within such a collective effort, the CEB’s role is clear. The CEB mandate is to support social cohesion – and, in times of strain, that mandate matters even more.

Seventy years on, the task may seem familiar in purpose, even if the pressures are different in form. When European cohesion is tested as it is today, social investment becomes decisive.

The CEB is – and will be – here to support its member countries, just as we have been doing with dedication and ingenuity for the last seventy years.

Thank you.

[1] European Barometer on Poverty and Economic Precariousness (Ipsos / Secours Populaire, 2025). Across Europe, 53% of respondents report more difficult access to a steady job than their parents’ generation, 45% to decent housing, and 42% to health services. Looking ahead, pessimism is even stronger: 61% expect access to a steady job to be more difficult for future generations, 59% to decent housing, and 53% to health services.