REPORT on the proposal for a decision of the European Parliament and of the Council on mobilisation of the European Globalisation Adjustment Fund, in accordance with point 28 of the Interinstitutional Agreement of 17 May 2006 between the European Parliament, the Council and the Commission on budgetary discipline and sound financial management
4.9.2009 - (COM(2009)0371 – C7‑0115/2009 – 2009/2066(BUD))
Committee on Budgets
Rapporteur: Reimer Böge
PR_BUD_Funds
MOTION FOR A EUROPEAN PARLIAMENT RESOLUTION
on the proposal for a decision of the European Parliament and of the Council on mobilisation of the European Globalisation Adjustment Fund, in accordance with point 28 of the Interinstitutional Agreement of 17 May 2006 between the European Parliament, the Council and the Commission on budgetary discipline and sound financial management
(COM(2009)0371 – C7‑0115/2009 – 2009/2066(BUD))
The European Parliament,
– having regard to the Commission proposal to the European Parliament and the Council (COM(2009)0371 – C7‑0115/2009),
– having regard to the Interinstitutional Agreement of 17 May 2006 between the European Parliament, the Council and the Commission on budgetary discipline and sound financial management (IIA of 17 May 2006)[1], and in particular point 28 thereof,
– having regard to Regulation (EC) No 1927/2006 of the European Parliament and of the Council of 20 December 2006 on establishing the European Globalisation Adjustment Fund[2] (EGF Regulation),
– having regard to the report of the Committee on Budgets and the opinion of the Committee on Employment and Social Affairs (A7-0006/2009),
A. whereas the European Union has set up the appropriate legislative and budgetary instruments to provide additional support to workers who suffer from the consequences of major structural changes in world trade patterns and to assist their reintegration into the labour market,
B. whereas the Union's financial assistance to workers made redundant should be dynamic and made available as quickly and efficiently as possible, in accordance with the Joint Declaration of the European Parliament, the Council and the Commission adopted during the conciliation meeting on 17 July 2008, and having due regard for the IIA of 17 May 2006 in respect of the adoption of decisions to mobilise the Fund,
C. whereas Spain and Portugal have requested assistance in respect of cases concerning redundancies in the textiles sector, respectively in the regions of Cataluña[3] and Norte-Centro[4] and have fulfilled the eligibility criteria set up by the EGF Regulation,
1. Requests the institutions involved to make the necessary efforts to accelerate the mobilisation of the Fund;
2. Stresses that the European Union should use all its means to face the consequences of the global economic and financial crisis; notes, in this respect, that the EGF can play a crucial role in the reintegration of workers made redundant into the labour market;
3. Recalls that the mobilisation of the EGF in payment appropriations should not jeopardise the funding of the European Union Social Fund; expresses some doubts about whether complementarity with other existing instruments like the EU Social Fund is guaranteed;
4. Undertakes to evaluate the functioning and added value of the EGF in the context of the general assessment of the programmes and other various instruments created by the IIA of 17 May 2006, within the process of the 2007-2013 multiannual financial framework budget review;
5. Approves the decision annexed to this resolution;
6. Instructs its President to sign the decision with the President of the Council and arrange for its publication in the Official Journal of the European Union;
7. Instructs its President to forward this resolution, including its annex, to the Council and the Commission.
ANNEX: DECISION OF THE EUROPEAN PARLIAMENT AND OF THE COUNCIL
of XX September 2009
on mobilisation of the European Globalisation Adjustment Fund, in accordance with point 28 of the Interinstitutional Agreement of 17 May 2006 between the European Parliament, the Council and the Commission on budgetary discipline and sound financial management
THE EUROPEAN PARLIAMENT AND THE COUNCIL OF THE EUROPEAN UNION,
having regard to the Treaty establishing the European Community,
having regard to the Interinstitutional Agreement of 17 May 2006 between the European Parliament, the Council and the Commission on budgetary discipline and sound financial management[1], and in particular point 28 thereof,
having regard to Regulation (EC) No 1927/2006 of the European Parliament and of the Council of 20 December 2006 establishing the European Globalisation Adjustment Fund[2], and in particular Article 12(3) thereof,
having regard to the proposal from the Commission,
Whereas:
(1) The European Globalisation Adjustment Fund (EGF) was established to provide additional support to redundant workers who suffer from the consequences of major structural changes in world trade patterns and to assist them with their reintegration into the labour market.
(2) The Interinstitutional Agreement of 17 May 2006 allows the mobilisation of the Fund within the annual ceiling of EUR 500 million.
(3) Spain submitted an application to mobilise the EGF, in respect of redundancies in the textiles sector, on 29 December 2008. This application complies with the requirements for determining the financial contributions as laid down in Article 10 of Regulation (EC) No 1927/2006. The Commission therefore proposes to deploy an amount of EUR 3 306 750.
(4) Portugal submitted an application to mobilise the EGF, in respect of redundancies in the textiles sector, on 23 January 2009. This application complies with the requirements for determining the financial contributions as laid down in Article 10 of Regulation (EC) No 1927/2006. The Commission therefore proposes to deploy an amount of EUR 832 800.
(5) The EGF should, therefore, be mobilised in order to provide a financial contribution for the applications submitted by Spain and Portugal,
HAVE DECIDED AS FOLLOWS:
Article 1
For the general budget of the European Union for the financial year 2009, the European Globalisation Adjustment Fund shall be mobilised to provide the sum of EUR 4 139 550 in commitment and payment appropriations.
Article 2
This Decision shall be published in the Official Journal of the European Union.
Done at Brussels,
For the European Parliament For the Council
The President The President
EXPLANATORY STATEMENT
I. Background
The European Globalisation Adjustment Fund has been created in order to provide additional assistance to workers suffering from the consequences of major structural changes in world trade patterns.
According to the provisions of point 28 of the Interinstitutional Agreement of 17 May 2006 on budgetary discipline and sound financial management[1] and of the Article 12 of Regulation (EC) No 1927/2006[2], the Fund may not exceed a maximum amount of EUR 500 million, drawn from any the margin under the global expenditure ceiling from the previous year, and / or from the cancelled commitment appropriations from the previous two years, excluding those related to Heading 1b. The appropriate amounts are entered into the budget as a provision as soon as the sufficient margins and / or cancelled commitments have been identified.
As concerns the procedure, in order to activate the Fund the Commission, in case of a positive assessment of an application, presents to the budgetary authority a proposal for mobilisation of the Fund and, at the same time, a corresponding request for transfer. In parallel, a trialogue is organised in order to find an agreement on the use of the Fund and the amounts required. The trialogue can take a simplified form.
II. State of play: Commission's proposal
This proposal concerns the mobilisation of a global amount of EUR 4.139.550 from the European Globalisation Adjustment Fund (EGF) in favour of Spain and Portugal, in order to cover the assistance to workers made redundant in textiles sector in the regions of Cataluña (Spain) and Norte-Centro (Portugal).
Both applications are based on the criteria set out by the Article 2(b) of the Regulation (EC) No 1927/2006, relating to the general intervention criteria (at least 1.000 redundancies over period of 9 months, particularly in small or medium-sized enterprises, in a NACE 2 sector in one region or two contiguous regions at NUTS II level).
The Spanish application, EGF/2008/005/ES/Cataluña, submitted to the Commission on 29 December 2008 and supplemented with additional information on 13 March 2009, relates to 1.720 redundancies occurred in 30 enterprises operating in textiles sector, all located in a single region at NUTS II level, in Cataluña. Spanish authorities applied for EUR 3.306.750 from the Fund.
The Portuguese application, EGF/2009/001/PT/Norte-Centro, has been submitted to the Commission on 29 January 2009. It refers to 1.588 redundancies occurred in 49 enterprises operating in Portuguese textile sector (NACE 13) in two contiguous regions of Norte and Centro. Portugal has applied for EUR 832.800 from the EGF.
In order to mobilise the Fund, the Commission has submitted to the Budget Authority a transfer request (DEC18//2009) for a global amount of EUR 4.139.550 from the EGF reserve (40 02 43) in commitments and from ESF budget lines (04 02 17 - ESF convergence) in payments to the EGF budget lines (04 05 01) for commitments and payments.
The IIA allows the mobilisation of the Fund within the annual ceiling of EUR 500 million. This is the second proposal for the mobilisation of the Fund in 2009. So far, two applications have been accepted for funding in 2009 for a global amount of EUR 3.384.300 in favour of Spain (Castilla y Leon and Aragon) and Commission's technical assistance.
In accordance with the article 12(6) of the legal base, on 1st September of each year, at least EUR 125 million (25%) should remain available in order to cover the needs arising until the end of the year. After deduction of the amount already committed in 2009, EUR 496.615.700 remain available.
Overview of applications - 2009 budget
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The European Globalisation Adjustment Fund (EGF): |
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Reference
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Member State |
Case
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EGF contribution (€) |
Redundancies
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EGF/2008/004 |
Spain |
Automobile industry /Castilla y Leon and Aragon
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2 694 300 |
1 082 |
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SEC(2008)2986 |
Commission |
Technical assistance |
690 000 |
--- |
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EGF/2008/005 |
Spain |
Textiles / Cataluña |
3 306 750 |
1 720 |
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EGF/2009/001 |
Portugal |
Textiles / Norte - Centro |
832 800 |
1 588 |
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TOTAL Margins |
7 523 850 492 476 150 |
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N.B. The Fund may not exceed a maximum amount of EUR 500 million per year |
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III. Procedure
The Commission has presented a transfer request[3] in order to enter specific commitment and payment appropriations in the 2009 budget, as required in Point 28 of the Interinstitutional Agreement of 17 May 2006.
The trialogue on the Commission's proposal for a Decision on the mobilisation of the EGF could take a simplified form (an exchange of letters), as provided for in Article 12(5) of the legal base, unless there is no agreement between the Parliament and the Council.
According to an internal agreement with the Employment and Social Affairs Committee (EMPL), this committee should be associated to the process, in order to provide constructive support and contribution to the implementation of the European Globalisation Adjustment Fund.
Following the assessment of the requests, the EMPL committee of the European Parliament gave their views on the mobilisation of the Fund, as expressed in the opinion attached to the present report.
The Joint Declaration of the European Parliament, the Council and the Commission, adopted during the conciliation meeting on 17 July 2008, has confirmed the importance of ensuring a rapid procedure with due respect of the Interinstitutional Agreement for the adoption of decisions on the mobilisation of the Fund.
OPINION OF THE COMMITTEE ON EMPLOYMENT AND SOCIAL AFFAIRS
Mr Alain Lamassoure
Chair of the Committee on Budgets
ASP 13 E 158
Subject: Opinion of the Committee on Employment and Social Affairs on the Commission proposal for a European Parliament and Council decision regarding mobilisation of the European Globalisation Adjustment Fund of 16 July 2009 (COM(2009)371 final)
Mr Chairman,
In order to facilitate the speedy adoption by the European budget authority of the Commission proposal for a decision of the European Parliament and Council regarding mobilisation of the European Global Adjustment Fund for the EGF/2008/005 ES/Cataluña and EGF/2009/001 PT/Norte‑Centro applications, the Committee on Employment and Social Affairs forwarded the proposal to its Working Group on the European Global Adjustment Fund (EGF) and to coordinators for consideration. The Working Group met on 1 September 2009 under my authority and instructed me to deliver the following opinion to you:
The Working Group on the European Global Adjustment Fund and the coordinators of the Committee on Employment and Social Affairs are in favour of mobilising the EGF in the case of the EGF/2008/005 ES/Cataluña and EGF/2009/001 PT/Norte-Centro applications. The Committee on Employment and Social Affairs has drawn up the following observations which do not, however, call into question the payment transfer.
The following points were considered:
a) General observations
Applications (Article 5 of Regulation 1927/2006)
The two applications for mobilisation of the Fund were submitted within the 10‑week deadline starting from the date on which the conditions for EGF intervention were satisfied. The applications, one of which was submitted at the end of 2008 and the other at the beginning of 2009, do not come under the procedure for mobilisation of the Fund as revised on 18 June 2009 in order to respond to the crisis.
Intervention criterion (Article 2 of Regulation 1927/2006)
According to the documents received by the Commission, the applications fulfil one necessary condition for an EGF intervention: at least 1 000 redundancies over a period of nine months, particularly in small or medium‑sized enterprises, in a NACE 2 sector in one region or two contiguous regions at NUTS II level, as laid down in Article 2(b) of Regulation 1927/2006.
In Spain, 1 720 people were made redundant, 1 269 of them in a 9‑month period (28 February 2008 to 27 October 2008) and the remaining 451 in the two months following the reference period. All redundancies took place in the NUTS II region of Catalonia. The 1 269 redundancies occurred in 30 enterprises.
In Portugal, 1 588 people lost their jobs during the reference period (16 February 2008 to 15 November 2008). In addition, in the ten weeks following the 9‑month period, 138 more redundancies occurred. 49 enterprises are affected in the two contiguous regions of Norte and Centro.
As laid down in Article 2 of Regulation 1927/2006, Spain and Portugal proved, according to the Commission, that the job losses were linked to major structural changes in world trade patterns which led to serious economic disruption, notably a massive increase of imports into the EU, or a progressive decline of the EU market share in a given sector or delocalisation to third countries.
The two applications concern the ‘manufacture of textiles’ sector, which is undergoing serious decline following the expiry of international agreements on textiles and clothing. As a result, the Commission concludes, on the basis of the dates (data?) provided by Spain and Portugal, that a link can be made between the redundancies and the major structural changes in world trade patterns, which led to an increase in the imports of textiles into the EU and a decline of the EU market share in textile production or delocalisation of production to third countries.
The EMPL committee working group can follow this reasoning.
Explanation of the unforeseen nature of the redundancies (Article 5.2(a) of Regulation 1927/2006)
This is explained by Spain and Portugal as resulting partly from waiting for stabilisation of the sector, which had meanwhile adapted to the new situation, and partly from the unforeseen rise in the value of the euro against the U.S. dollar.
In terms of the local and regional situation described below, it would have been useful in evaluating the two applications for the Commission to give greater emphasis to explaining the unforeseen nature of the redundancies, as required by Article 5.2 of the Regulation.
Complementarity, conformity and coordination (Article 6 of Regulation 1927/2006)
The two Member States confirm that the measures described are complementary to the actions financed by the Structural Funds. They guarantee administrative steps to avoid double funding and continuous monitoring of the activity of the ESF and the EGF.
In addition, Spain and Portugal can prove that the EGF contribution will not be used to restructure enterprises but solely for measures in support of the workers concerned.
Finally, the Spanish and Portuguese authorities have confirmed that the EGF contribution will not replace measures that are the responsibility of enterprises under national legislation or collective agreements.
Administrative costs pursuant to Article 3 of the Regulation
The two Member States specify that the administrative costs pursuant to Article 3 of Regulation (CE) 1027/2006 stem from drawing up the applications, management, information, publicity and controls concerning the implementation of the EGF.
Equality between men and women and absence of discrimination (Article 7 of the Regulation)
On the basis of the information provided by the Commission, neither Portugal nor Spain state clearly whether they have supplied evidence showing that the application of gender mainstreaming has been respected, as laid down by the Regulation, at the various stages of implementation of the EGF. It is also impossible to evaluate whether the non‑discrimination requirement has been observed.
(b) Special features of the applications
EGF/2008/005 ES/Cataluña
Expected impact of the redundancies on local, regional or national employment (Article 1 of the Regulation)
In Catalonia there was a significant increase in the number of unemployed textile industry workers from 2004 to 2008. In 5 of the 12 comarques (districts) of the Autonomous Community of Catalonia, where some areas have a high number of textile sector enterprises, 50% or more of those out of work have been made redundant from the textile sector. The redundancies which have occurred in the textile sector therefore have a stronger impact than those in other sectors, and there is little opportunity for re‑employment within the industry for redundant workers.
It should be noted that the documents give no figures for the unemployment rate in Catalonia, so that it is difficult to put the percentages shown in perspective.
Eligible actions (Article 3 of the Regulation)
Spain proposed a coordinated package of personalised services designed to re‑integrate the 1 100 redundant workers in need of assistance into the labour market. The package includes career guidance for all the workers concerned. The other measures concern only those workers with specific needs. For example, 550 workers will receive training and development comprising an assessment of their training needs and training in areas in which opportunities exist.
Attention must be drawn in particular to measures providing ‘incentives for external re‑employment’, which include temporary financial assistance of EUR 2 500 (rising to EUR 3 000 for workers over 45) for workers who accept an employment contract for at least six months. This assistance is to be paid only if the annual salary on offer is less than EUR 38 000.
In addition, Article 3(c) of Regulation 1927/2006 provides for measures aimed particularly at enabling disadvantaged or older workers to remain in or return to the labour market.
The application shows that slightly more than one third of the total (435 people), most of whom are below 45, should benefit from this measure – a figure close to EUR 2 500 per person is indicated. The Commission does not state why an incentive to take a job is needed in these cases, given an annual salary of EUR 38 000. It is, moreover, not certain that this kind of measure is covered by Article 3.
EGF/2009/001 PT/Norte-Centro
Expected impact of the redundancies as regards local, regional or national employment (Article 1 of the Regulation)
According to the Portuguese authorities, the communities most affected by unemployment in the textile sector recorded levels of unemployment in 2008 which were higher (9%/11%) than the average in mainland Portugal and in the whole of the Norte region (5.8%/7%). They also state that those areas particularly dependent upon textile production have few other job opportunities that are readily available for those made redundant.
Eligible actions (Article 3 of the Regulation)
The Portuguese authorities state that, given the profile of the workers affected, they have prioritised measures to motivate and provide information to those with a lower level of education who have problems managing their career proactively and have little motivation to do so.
The coordinated package of personalised services is aimed at reintegrating workers into the labour market. Such services rely on personal employment plans (PEPs), which were drawn up together with the workers before the EGF application was submitted and do not form part of the EGF package of measures. The PEP includes advisory services, group discussions and a plan for professional motivation, personal development and strategies for entering the labour market. The measures include, for example, a programme for 300 people with less than nine years’ formal education. Those following the programme will, together with the trainers, draw up a personalised plan, of variable duration, directed towards the accreditation of experience acquired, professional expertise and certification of primary or secondary equivalence education.
Identifying the categories of workers affected (Article 5.2(b))
The fact that the Portuguese authorities propose measures aimed at 1 000 people, whereas 1 504 workers are set to benefit from measures financed by the EGF, and that all the descriptions of categories of workers refer to this figure, raises questions. It is difficult to work out which people will in fact take part in one of the proposed measures.
On the other hand, since the Commission has pointed out that the way in which those eligible to take part in measures financed by the EGF were presented was an example of sound financial management, this could be used as an example for other Member States.
It would, therefore, be useful if the specification of the people involved were to correspond as closely as possible with the actual group of participants.
Remarks on cooperation for the mobilisation of the EGF
The special procedure for mobilising the EGF in order to stimulate economic growth and create more jobs in the EU requires effort and the will to cooperate from all concerned. Full information which is provided on time is crucial for the EMPL Committee, which has the task of giving its opinion to the Committee on Budgets with regard to transfers of appropriations to Member States. Improved planning, as part of closer cooperation with the Committee on Budgets, will be made possible through immediate notification by the Commission of applications submitted by Member States. This is the only way in which a well‑substantiated, high‑quality decision to the benefit of European citizens can be taken.
Yours sincerely,
Pervenche Berès
PROCEDURE
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Title |
Mobilisation of the European Globalisation Adjustment Fund, in accordance with point 28 of the Interinstitutional Agreement of 17 May 2006 between the European Parliament, the Council and the Commission on budgetary discipline and sound financial management |
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References |
COM(2009)0371– C7-0115/2009 – 2009/2066(BUD) |
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Committee responsible Date announced in plenary |
BUDG0.0.0000
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Committee(s) asked for opinion(s) Date announced in plenary |
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Rapporteur(s) Date appointed |
Reimer Böge 24.1.2008 |
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Previous rapporteur(s) |
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Date draft amending budget established by the Council |
13.7.2009 |
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Date draft amending budget forwarded by the Council |
21.7.2009 |
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Discussed in committee |
2.9.2009 |
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Date adopted |
2.9.2009 |
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Result of final vote |
+: –: 0: |
37 1 1 |
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Members present for the final vote |
Damien Abad, Alexander Alvaro, Francesca Balzani, Reimer Böge, Giovanni Collino, Andrea Cozzolino, James Elles, Göran Färm, José Manuel Fernandes, Eider Gardiazábal Rubial, Salvador Garriga Polledo, Jens Geier, Ivars Godmanis, Ingeborg Gräßle, Estelle Grelier, Carl Haglund, Jutta Haug, Jiří Havel, Edit Herczog, Monika Hohlmeier, Sidonia Elżbieta Jędrzejewska, Ivaylo Kalfin, Sergej Kozlík, Alain Lamassoure, Janusz Lewandowski, Vladimír Maňka, Barbara Matera, Nadezhda Mihaylova, Claudio Morganti, Miguel Portas, Vladimír Remek, Sergio Paolo Francesco Silvestris, Daniël van der Stoep, László Surján, Helga Trüpel, Angelika Werthmann, Jacek Włosowicz |
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Substitute(s) present for the final vote |
Frederic Daerden, Georgios Stavrakakis |
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Substitute(s) under Rule 178(2) present for the final vote
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Date tabled |
4.9.2009 |
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Comments (available in one language only)
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