MEPs adopted a legislative report on an agreement between the Parliament and Council on the Commission's proposal to establish a European Globalisation Adjustment Fund (EGF). The agreement will mean that the fund, which will provide up to €500 million each year to help reintegrate into the labour market workers made redundant due to changes in global trade patterns will be able to become operational as of 1 January 2007.
In informal negotiations, Council had accepted most of the Employment Committee positions, expressed in the report by Roselyne Bachelot-Narquin (EPP-ED, FR), on the controversial issues a compromise has been reached, which has been adopted by Parliament today with a large majority in favour.
The European Parliament stresses that, notwithstanding the positive effects of globalisation on growth and jobs, it may also have negative consequences for the most vulnerable and least qualified workers in some sectors. Assistance from the EGF should therefore provide solidarity and support for individual workers made redundant as a result of structural changes in world trade patterns. It should not finance the restructuring of companies or sectors - only active labour market measures shall be supported and not passive social protection measures, says the committee. The EGF should also have the aim of stimulating economic growth and creating more jobs in the European Union.
Who is eligible for funding from the EGF?
MEPs want to guarantee that more cases can be supported via the EGF, a view which is included in the final compromise: Assistance should be concentrated on workers made redundant in those areas most adversely affected by economic dislocation due to changes in world trade patterns leading to a serious economic disruption, notably a substantial increase of imports into the EU or a rapid decline of the EU market share in a given sector or a delocalisation to third countries which results in:
-at least 1,000 workers lose their jobs in an company, its suppliers or downstream producers over a period of 4 months (covers the whole EU territory, not only specific regions as foreseen on the original Com proposal)
-at least 1,000 workers particularly in different SMEs lose their job, over a period of 9 months due to a sectoral crisis in a region.
-in small labour markets or in exceptional circumstances an intervention is possible if the redundancies have a serious impact on employment and the local economy, even if the above mentioned conditions are not met.
15 % of the fund's provision will be earmarked for these exceptional circumstances and small labour markets mentioned in point number three , an important point for MEPs who wanted to guarantee more flexibility.
Since economic dislocations are not necessarily concentrated in a single Member State, in exceptional circumstances, Member States may submit joint requests for assistance from the EGF.
What kinds of measures are financed?
Active labour market measures which may be financed via the EGF include:
-job-search assistance, occupational guidance, tailor-made training and re-training including ICT skills and certification of acquired experience, outplacement assistance and entrepreneurship promotion or aid for self-employment;
-special time-limited measures, such as job search allowances, mobility allowances or allowances to individuals participating in lifelong learning and training activities;
-measures to stimulate in particular disadvantaged or older workers, to remain in or return to the labour market.
Where does the money come from?
The Commission proposal says a maximum amount of €500 million per year will be financed through funds that have been under-spent against the other budget ceilings. The Compromise set out some detail on how this should operate.
When will the EGF be up and running?
The EGF can start as soon as the new regulation enters into force, at the end of the present co-decision procedure. Since the compromise has been adopted by the EP's Plenary, only Council has to adopt it now and the procedure can be ended in first reading and the fund can become operational as of January 2007.
Where will more Information be available?
Following a demand by MEPs, the Compromise states, that the Commission will set up an internet site, available in all community languages, to provide information on the EGF, guidance on the submission of applications and updated information on accepted and refused applications.