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This article investigates the new party politics of welfare states with a particular focus on electoral competition. The argument is that welfare state politics are no longer just about more or less, but involve trade‐offs among ‘new’ versus ‘old’ social rights, and hence social investment versus social consumption. However, party priorities on these issues are highly dependent upon their electoral situation. As electoral competition becomes more intense, parties focus more on vote maximisation than on their traditional policy goals. For left parties, this means focusing more on social investment, which appeals to their growing constituency of progressive sociocultural professionals, and less on defending the traditional income maintenance programmes favoured by their core blue‐collar voters. Centre‐right parties, on the other hand, should hesitate to retrench old social rights when electoral competition intensifies because they need to prioritise their appeal to culturally conservative working‐class voters over their traditional fiscally conservative policy profiles. Using a new dataset and a recently published measure of electoral competitiveness, the article shows that as electoral competition intensifies, left governments are willing to prioritise social investment by reducing pension rights generosity in order to expand programmes for new social risks, while centre‐right governments by contrast avoid retrenchment of pension rights and pension expenditures. The findings demonstrate that this relationship is moderated by the presence of a credible radical right challenger, which increases the electoral risk of welfare state recalibration.
