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
28.10.2010 - (COM(2010)0489 – C7‑0280/2010 – 2010/2214(BUD))
Committee on Budgets
Rapporteur: Barbara Matera
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 (application EGF/2009/021 IE/SR Technics from Ireland)
(COM(2010)0489 – C7‑0280/2010 – 2010/2214(BUD))
The European Parliament,
– having regard to the Commission proposal to the European Parliament and the Council (COM(2010)0489 – C7‑0280/2010),
– 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](IIA of 17 May 2006), 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 letter of the Committee on Employment and Social Affairs,
– having regard to the report of the Committee on Budgets (A7-0297/2010),
A. whereas the European Union has set up the appropriate legislative and budgetary instruments to provide additional support to workers who are suffering from the consequences of major structural changes in world trade patterns and to assist their reintegration into the labour market,
B. whereas the scope of the EGF was broadened for applications submitted from 1 May 2009 to include support for workers made redundant as a direct result of the global financial and economic crisis,
C. 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 EGF,
D. whereas Ireland has requested assistance in respect of cases concerning 850 redundancies in the enterprise SR Technics Ireland Ltd operating in the air transport sector in the NUTS III region Dublin,
E. whereas the application fulfils 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 EGF;
2. Recalls the institutions’ commitment to ensuring a smooth and rapid procedure for the adoption of the decisions on the mobilisation of the EGF, providing one-off, time-limited individual support geared to helping workers who have suffered redundancies as a result of globalisation and the financial and economic crisis; emphasises the role that the EGF can play in the reintegration of workers made redundant into the labour market;
3. Stresses that, in accordance with Article 6 of the EGF Regulation, it should be ensured that the EGF supports the reintegration of individual redundant workers into employment; reiterates that assistance from the EGF must not replace actions which are the responsibility of companies by virtue of national law or collective agreements, nor measures restructuring companies or sectors;
4. Notes that the information provided on the coordinated package of personalised services to be funded from the EGF includes detailed information on the complementarity with actions funded by the Structural Funds; reiterates its call to present a comparative evaluation of these data in its annual reports as well;
5. Welcomes the fact that, in the context of mobilising the EGF, an alternative source of payment appropriations to unused European Social Fund has been proposed by the Commission, following the frequent reminders by the European Parliament that the EGF was created as a separate specific instrument with its own objectives and deadlines and that appropriate budget lines for transfers must therefore be identified;
6. Notes however that, in order to mobilise the EGF for this case, payments appropriations will be transferred from a budget line dedicated to the support of SMEs and innovation; regrets the severe shortcomings of the Commission when implementing the programmes on competitiveness and innovation, particularly during an economic crisis which should significantly increase the need for such support;
7. Recalls that the functioning and the added value of the EGF should be evaluated in the context of the general assessment of the programmes and various other instruments created by the IIA of 17 May 2006 within the process of the 2007-2013 multiannual financial framework mid-term review;
8. Welcomes the new format of the Commission’s proposal, which presents in its explanatory memorandum clear and detailed information on the application, analyses the eligibility criteria and explains the reasons which led to its approval, which is in line with Parliament’s requests;
9. Approves the decision annexed to this resolution;
10. Instructs its President to sign the decision with the President of the Council and to arrange for its publication in the Official Journal of the European Union;
11. 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 xxx
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 (application EGF/2009/021 IE/SR Technics from Ireland)
THE EUROPEAN PARLIAMENT AND THE COUNCIL OF THE EUROPEAN UNION,
having regard to the Treaty on the Functioning of the European Union,
h
aving 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 European Commission[3],
Whereas:
(1) The European Globalisation Adjustment Fund (EGF) was established to provide additional support for workers made redundant as a result of major structural changes in world trade patterns due to globalisation and to assist them with their reintegration into the labour market.
(2) The scope of the EGF was broadened for applications submitted from 1 May 2009 to include support for workers made redundant as a direct result of the global financial and economic crisis.
(3) The Interinstitutional Agreement of 17 May 2006 allows the mobilisation of the EGF within the annual ceiling of EUR 500 million.
(4) Ireland submitted an application to mobilise the EGF, in respect of redundancies in SR Technics on 9 October 2009 and supplemented it with additional information up to 18 May 2010. 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 mobilise an amount of EUR 7 445 863.
(5) The EGF should, therefore, be mobilised in order to provide a financial contribution for the application submitted by Ireland.
HAVE ADOPTED THIS DECISION:
Article 1
For the general budget of the European Union for the financial year 2010, the European Globalisation Adjustment Fund (EGF) shall be mobilised to provide the sum of EUR 7 445 863 in commitment and payment appropriations.
Article 2
This Decision shall be published in the Official Journal of the European Union.
Done at,
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 trilogue could be organised in order to find an agreement on the use of the Fund and the amounts required. The trilogue can take a simplified form.
II. State of play: Commission's proposal
On 21 September 2010 the Commission has adopted a new proposal for a decision on the mobilisation of the EGF in favour of Ireland in order to support the reintegration in the labour market of workers made redundant due to the global financial and economic crisis.
This is the seventeenth application to be examined under the budget 2010 and refers to the mobilisation of a global amount of EUR 7.445.863 from the EGF for Ireland. It concerns 1135 redundancies (of which 850 targeted for assistance) in the enterprise SR Technics Ireland Ldt operating in the air transport sector in the NUTS III region Dublin, during the four-month reference period from 3 April to 2 August 2009.
The application, case EGF/2009/021 IE/Technics, was submitted to the Commission on 9 October 2009 and supplemented by additional information up to 18 May 2010. The application was based on the intervention criterion of Art. 2 (a) of the EGF Regulation - which requires at least 500 redundancies over a four-month period in an enterprise, including its suppliers and downstream producers - and was submitted within the deadline of 10 weeks (Art. 5 of the Regulation).
Commission's assessment was based on the evaluation of the link between the redundancies and major structural changes in world trade patterns or the financial crisis, the unforeseen nature of the concerned redundancies, demonstration of number of redundancies and compliance with the criteria of Article 2 (a), explanation of the unforeseen nature of those redundancies, identification of dismissing enterprises and workers targeted for assistance, the territory concerned and its authorities and stakeholders, the impact for the redundancies as regards the local, regional or national employment, co-ordinated package of personalised services to be funded, including its compatibility with actions funded by the Structural Funds, dates on which the personalised services to affected workers were started or planned to start, procedures for consulting the social partners, management and control systems.
In accordance with Commission's assessment, the application fulfils the eligibility criteria set up by the EGF Regulation and recommends to the Budget Authority to approve the applications.
In order to mobilise the Fund, the Commission has submitted to the Budget Authority a transfer request (DEC 28/2010) for a global amount of EUR 7.445.863 from the EGF reserve (40 02 43) in commitments and from the budget line " Completion of programme for enterprises: improvement of the financial environment for small and middle-sized enterprises (SMEs)" (01 04 05) in payments to the EGF budget lines (04 05 01).
The Rapporteur is pleased to observe that the Commission has identified an alternative source of payment appropriations to unused ESF Funds, in accordance with the frequent requests from the European Parliament.
However, she considers that the choice made in this case (budget line dedicated to the support of SMEs and innovation) is not satisfactory given the severe shortcomings that the Commission encounters when implementing the programmes on competitiveness and innovation. In a period of economic crisis these appropriations should be in fact rather increased. She invites therefore the Commission to continue in her effort to identify more appropriate budget lines for payments in the future.
The IIA allows the mobilisation of the Fund within the annual ceiling of EUR 500 million.
In 2010, the Budget Authority has already approved eleven proposals for the mobilisation of the Fund and a transfer for the Technical assistance, for a total amount of EUR 32.943.098, which added to the additional amount of EUR 14.489.399 related to the other proposals under discussion, leaves an amount of EUR 452.567.503 available until the end of 2010.
III. Procedure
The Commission has presented a transfer request[3] in order to enter specific commitment and payment appropriations in the 2010 budget, as required in Point 28 of the Interinstitutional Agreement of 17 May 2006.
The trilogue 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, the Employment and Social Affairs Committee (EMPL) should be associated to the process, in order to provide constructive support and contribution to the assessment of the applications from the Fund.
Following its evaluation, the EMPL committee of the European Parliament gave its view 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.
ANNEX: LETTER OF THE COMMITTEE OF EMLPOYMENT AND SOCIAL AFFAIRS
ES/jm
D(2010)49422
M. Alain Lamassoure
President of the Committee on budgets
ASP 13E158
Subject: Opinion on the mobilisation of the European Globalisation Adjustment Fund (EGF) for the case EGF/2009/021 IE/SR Technics (COM(2010)489 final)
Dear Mr Lamassoure,
The Committee on Employment and Social Affairs (EMPL) as well as its Working Group on the EGF examined the mobilisation of the EGF for the case EGF/2009/021 IE/SR Technics and adopted the following opinion.
The EMPL committee and the Working Group on the EGF are in favour of the mobilisation of the Fund concerning this request. In this respect, the EMPL committee presents some remarks without, however, putting into question the transfer of the payments.
The deliberations of the EMPL committee are based on the following considerations:
A) Whereas this application was received by the Commission on 9 October 2009 and supplemented by additional information up to 18 May 2010.
B) Whereas, according to the Irish government and the Commission, the 1.135 redundancies, of which 800 occurred during the reference period from 3 April to 2 August 2009, are linked to the reduction in air transport activity as a result of the global financial and economic crisis.
C) Whereas the Irish authorities argue that there was no prior warning of the severity of the current global economic and financial crisis and that, therefore, a planned and gradual response was not possible.
D) Whereas the increase of people registered with the "Live Register" of the four Counties concerned by the redundancies amounts to more than 20 % and whereas the redundancies will generate significant losses in indirect employment through the loss in workers' incomes and through a reduction in SR Technics purchases of goods and services locally and regionally.
E) Whereas no explicit information about the educational level of the dismissed workers is available.
F) Whereas 93,8 % of the redundant workers are men and whereas 95,1 % of them are between 25 and 54 years old.
G) Whereas 20,4% of the workers was working with SR Technics as managers, 17,9% in technical professions and 47,3% as craft and related trades workers.
Therefore, the Committee on Employment and Social Affairs calls on the Committee on Budgets, as the committee responsible, to integrate the following suggestions in its motion for a resolution concerning the Irish application:
1. Agrees with the Commission that this application meets the conditions for a financial contribution under the EGF-Regulation 1927/2006 as amended in 2009.
2. Asks the Commission to explain more in detail why the verification of this application that seems clear and straight forward as it is presented today took such a long time (one year) before being presented to the budgetary authority.
3. Requests more information about which measures were offered to the redundant workers since they lost their job from April 2009 (and earlier?) onwards.
4. Welcomes the broad range of measures offered to the redundant workers including occupational guidance and training for the acquisition of basic skills, on-and-off-the-job training for redundant apprentices, vocational educational training, support for entrepreneurship and self-employment as well as third level education.
5. Regrets that the trade unions are not mentioned as principal or additional stakeholders and asks the Irish authorities to explain more in detail how the social partners were involved in the application and will participate in the implementation of the measures.
Yours sincerely,
Pervenche Berès
RESULT OF FINAL VOTE IN COMMITTEE
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Date adopted |
26.10.2010 |
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Result of final vote |
+: –: 0: |
19 0 1 |
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Members present for the final vote |
Reimer Böge, Lajos Bokros, Giovanni Collino, Eider Gardiazábal Rubial, Salvador Garriga Polledo, Ivars Godmanis, Jutta Haug, Anne E. Jensen, Ivailo Kalfin, Alain Lamassoure, Giovanni La Via, Vladimír Maňka, Barbara Matera, Claudio Morganti, Dominique Riquet, László Surján, Angelika Werthmann, Jacek Włosowicz |
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Substitute(s) present for the final vote |
Paul Rübig |
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Substitute(s) under Rule 187(2) present for the final vote |
Brian Crowley |
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