In recent decades the European Union (EU) has put increased emphasis on education and training as a strategic area able to contribute to economic development and a more inclusive society. Soft governance has contributed to progress in attempts to coordinate national policies and institutions. However, national performances and trends are still far from the targets set by the EU. To explain this contradiction between EU ambitions and its limited influence on national performance, we look at the policy content of EU economic and social governance. The inconsistency between short-term fiscal consolidation and longterm social investment seems to be one of the sources of the contradiction Moreover, this inconsistency has become more acute since the ‘Great Recession’. If the EU wishes to make progress in this area, a more coherent set of incentives favouring long-term investments has to be implemented (through revision of the stability rules and/or using the EU structural funds to help Member States invest in this area).