The Social Reform system in Victoria 2 is a mechanism that seeks to emulate the wave of initiatives aimed at curing social ills during the late Victorian and Progressive eras. Historically, such reforms were often halting affairs taking place over many years in short bursts, and often reform was largely accomplished by private citizens and business with little to no government intervention. These reforms were also extremely diverse, ranging from the commonly cited safety or health codes of the early 20th century, to the ill-fated and universally panned temperance and prohibition movements of the late 19th and early 20th centuries.
As you can see, the historical facts of social reform are quite messy. For simplicity, the Vicky2 system displays only the most common reforms and ignores private sector reforms in favor of more easily managed state reforms. These reforms may be seen as helpful or harmful overall depending on personal taste, but regardless of one's individual opinion on the reforms there are certain costs and benefits to each one.
Types and Costs of Reform
There are seven types of state social reform available to you in Victoria 2, six of which has five different levels, and one of which has four. There are various costs and benefits to each, which will be detailed below. Of the seven reforms, five increase administrative needs and are thus factored into your administrative budget, while the remaining two (pensions and unemployment subsidies) are handled by the social spending budget. Any reform that is handled by the administrative bureaucracy increases the need for bureaucrats by .1% of population per step. For example, if a player were to implement the maximum level of minimum wage reform, his country would now need 1.4% bureaucrats to achieve 100% administrative efficiency rather than 1%. There may be other costs to reform as well, some more apparent than others. For example, the decreased industrial efficiency that comes with several of the reforms may wipe out many factories, or require the player to subsidize them. Industrial subsidies can become unbearably costly for a large industrial power, so reformer beware.
Minimum Wage
The minimum wage reform is an ambiguous reform, for it will only affect factories who are in a state that has capitalists. Without capitalists, the minimum wage is ignored. If capitalists are present, it will act as a minimum income. If factory profits divided by 2 are higher than this minimum, that will be used instead (equal doesn't matter). Else, the minimum wage will first be taken from the capitalist paychecks and if that's not enough, from the profit (even if that turns it into a loss). The calculation for the amount is described in the spoiler below. Experience suggests implementing the minimum wage can have devastating effects on industry, particularly if the reforming country's ruling party is Laissez-Faire and thus cannot subsidize factories. This reform is handled by the administrative bureaucracy; its costs are calculated in that section of the budget, and its implementation increases bureaucratic needs as described above.
Calculation
Administrative Efficiency (AE)
Life Needs price unadjusted by Consciousness (LN)
Effective Tax (ET)
Amount of factory working POPs (X)
Minimum Income (Y)
Maximum Work Hours
The maximum work hours, as its name suggests, sets a cap on maximum hours worked. From a game mechanics perspective, it decreases the luxury needs for poor and middle strata by 5% per step, for a maximum of a 20% reduction. This makes achieving luxury goods satisfaction markedly easier, a useful tool if one seeks to keep his populations happy, seeks to convert or assimilate populations, or any number of other tasks that require a high level of population satisfaction.
The cost, however, is a 5% decrease in factory throughput per step. This can seriously affect industrial production, and thus profitability. Again, Laissez-Faire beware, this reform could send your factories into the red, wiping out vast swathes of industry overnight. This cost is less potent if the reforming country has large populations of capitalists, large populations of clerks, high industrial and commercial technology levels, well-developed railway networks, or any combination of the above. This reform is handled by the administrative bureaucracy; its costs are calculated in that section of the budget, and its implementation increases bureaucratic needs as described above.
Mandatory Safety Regulations
This reform imposes a state-required safety regime on industrial enterprises. This decreases the everyday needs for all strata (rich, middle, and poor) by 5% per step, to a maximum of 20%. As with the maximum work hours reform, this benefit can seriously improve the situation for a country's pops, and in the process have a significant effects on the player's ability to accomplish his goals.
The costs of this reform are a 25% increase in factory maintenance per step, for a whopping 100% total if the maximum reform level is achieved. As with the other reforms, this can seriously affect the profitability and viability of industry of a country. Also as with other reforms, look to capitalists, clerks, technology, and infrastructure to abate these costs. This reform is handled by the administrative bureaucracy; its costs are calculated in that section of the budget, and its implementation increases bureaucratic needs as described above.
Unemployment Subsidies
The unemployment subsidies reform creates a state-monopolized unemployment insurance regime. As it does in reality, unemployment subsidies provide an income supplement to out-of-work pops. This subsidy can be very helpful to the player, though it may not appear so at first. Population promotion and demotion are affected by a variety of different variables, but the most significant variable that promotes pop demotion is needs fulfillment. If a pops needs go unfulfilled (usually because their income cannot support its strata's needs) it will eventually demote to a lower pop with fewer needs. In cases of capitalists, clerks, and craftsmen, this is an incredibly annoying reality, as it can seriously hamper the player's ability to maintain a consistent or growing population of industrial workers. Unemployment subsidies help to ease this problem and insure a stable base of skilled workers.
The costs of this reform are calculated as described below and are funding via the social spending budgetary category. As such, this may be one of the more attractive reforms to a player of industrial powers, as its costs are borne entirely by the state budget, not factory owners, and it actually can help preserve the most important factor of industrialization in Victoria 2: a large base of craftsmen (as well as capitalists and clerks).
Calculation
Administrative Efficiency (AE)
Social Spending (SS)
Life Needs price unadjusted by Consciousness (LN)
Effective Tax (ET)
Amount of unemployed POPs (X)
Social welfare income (Y)
State Pensions
The pensions reform provides state-guaranteed old age pensions. All pops in game are basically representative of the working-age male population. This is why the pops, and consequently your "population" and the population of provinces, all added together equal 1/4 of your "total population." It is therefore assumed that each visible pop has a number of young, female, or old people attached to it. Thus, pensions increase your pops' incomes on this rationale. Pensions are a good way to increase your poor and middle pops' purchasing power, so long as you have the money to foot the social spending bill.
The costs of this reform are calculated through the social spending budgetary category, and is dependent upon your population size.
Pensions are calculated like unemployment subsidies, but for all POPs.
National Health Care
It is undoubtedly the most potent social reform, as it increases population growth by a 0.02% per level, to a maximum of 0.08%. Population growth is extremely desirable in Victoria 2, as industrialization relies almost exclusively on the conversion of excess farmers and laborers into craftsmen. The fastest way to acquire this desired excess is to increase your total population beyond the level needed to fully staff RGOs. Thus, this reform, especially if implemented relatively early in the game, is extremely important.
As if the benefits of this reform weren't impressive enough, it has no other costs aside from administrative ones. This reform is handled by the administrative bureaucracy; its costs are calculated in that section of the budget, and its implementation increases bureaucratic needs as described above.
Public School System
The public school reform creates a public school system that educates your nation's youth. This one is unique in that, unlike the other six social reforms, the public school system only has four levels. The first level of reform increases your education efficiency by 10%, equivalent to one level of social thought research in the culture section, while the other two increase it by a further 5% each. This reform is useful for any nation that wants to improve its literacy, especially newly civilized nations that need to quickly catch up on research. Generally, the player wants to enact this reform only if desperate for more literacy, as it isn't as immediately effective as health care or pensions are. This reform is paid for through the administrative budget, and increases your need for bureaucrats as described above.
Implementing and Repealing Reforms
Most countries begin with no social reforms. Some may have a single low level reform, but this is the exception not the rule. For a list of base social reforms indexed by country, see country social reforms. Like political reforms, a country can implement a social reform if its Upper House is in favor of doing so. Reforms must be implemented or repealed consecutively. That is, a player cannot simply jump from a low or nonexistent reform up to a high-level reform or vice versa, this must be done in steps. The exception to this rule is if the reform is imposed by event. There are several random events that give the player choice over the implementation or repeal of social reforms, as well as a number of country-specific events.
Certain ideologies are more likely to implement social reforms than others. Socialists and Communists are the most likely to vote in favor of social reform. Liberals may support reforms to a degree depending on circumstance. Conservatives and Reactionaries are unlikely to ever support reforms (unless militancy is very high), and if Reactionaries hold the Upper House, they can repeal social reforms. Immediately upon implementing a social reform, the Upper House becomes more Conservative, which may delay the implementation of further reforms if your Upper House does not adjust itself quickly.
If the player wishes to implement the social reforms as quickly as possible, it is advised to deliberately drive militancy up to make the uncooperative parts of Upper House vote "Yes". Militancy can be driven up by holding elections and then changing the ruling party, or through various events and event choices.
Miscellaneous
The social reforms data can be accessed by locating the Paradox folder in the drive to which it is saved, the navigating to Victoria 2/common/issues.txt.