In a report released as the European Union's financial ministers head to a meeting in Vilnius, the capital of Lithuania, Oxfam said that the austerity budgeting strategy embraced by Europe has been a failure on two fronts. It has failed to help the European economy to grow and also failed to reduce government debt, which governments attempted to do as debt was viewed as a major contributor to the recession.
In a statement, Oxfam said governments failed to appreciate the lessons "from the calamitous periods of austerity cuts to social spending in Latin America, South East Asia and Africa throughout the 1980s and 90s."
"Some countries in these regions took two decades to claw their way back to square one," the statement said.
"Europe's handling of the economic crisis threatens to roll-back decades of social rights. Aggressive cuts to social security, health and education, fewer rights for workers and unfair taxation are trapping millions of Europeans in a circle of poverty that could last for generations. It is moral and economic nonsense," said Natalia Alonso, the director of Oxfam's European Union office.
Oxfam estimates that austerity policies threaten to push up to 25 million more Europeans into poverty by 2025, "nearing the population of the Netherlands and Austria combined."
If that occurs, the number of Europeans in poverty would reach 146 million, "over a quarter of the population," Oxfam said.