The article studies the development of social services in Britain, France and Germany since the 1980s. In this period services grew strongly and were extended to large population groups, although the welfare state was in crisis. Moreover, the power of the state was enhanced. The share of public service provision declined somewhat, but this was more than balanced by increased public funding and intensified state control of delivery. The paper argues that the rise of social services does not signal a ‘new’ welfare state. Rather, the belated expansion of social services compared to other areas is explained by the fact that services have become crucial for the economy and the labour market only recently. Since this was the case, they have followed the classical path of welfare state expansion.