Report - A8-0314/2016Report
A8-0314/2016
European Parliament

REPORT on the proposal for a decision of the European Parliament and of the Council on the mobilisation of the European Globalisation Adjustment Fund (application from Estonia – EGF/2016/003 EE/petroleum and chemicals)

24.10.2016 - (COM(2016)0622 – C8‑0389/2016 – 2016/2235(BUD))

Committee on Budgets
Rapporteur: Victor Negrescu

Procedure : 2016/2235(BUD)
Document stages in plenary
Document selected :  
A8-0314/2016
Texts tabled :
A8-0314/2016
Debates :
Votes :
Texts adopted :

MOTION FOR A EUROPEAN PARLIAMENT RESOLUTION

on the proposal for a decision of the European Parliament and of the Council on the mobilisation of the European Globalisation Adjustment Fund (application from Estonia – EGF/2016/003 EE/petroleum and chemicals)

(COM(2016)0622 – C8‑0389/2016 – 2016/2235(BUD))

The European Parliament,

–  having regard to the Commission proposal to the European Parliament and the Council (COM(2016)0622 – C8‑0389/2016),

–  having regard to Regulation (EU) No 1309/2013 of the European Parliament and of the Council of 17 December 2013 on the European Globalisation Adjustment Fund (2014-2020) and repealing Regulation (EC) No 1927/2006[1] (EGF Regulation),

–  having regard to Council Regulation (EU, Euratom) No 1311/2013 of 2 December 2013 laying down the multiannual financial framework for the years 2014-2020[2], and in particular Article 12 thereof,

–  having regard to the Interinstitutional Agreement of 2 December 2013 between the European Parliament, the Council and the Commission on budgetary discipline, on cooperation in budgetary matters and on sound financial management[3] ((IIA of 2 December 2013), and in particular point 13 thereof,

–  having regard to the trilogue procedure provided for in point 13 of the IIA of 2 December 2013,

–  having regard to the letter of the Committee on Employment and Social Affairs,

–  having regard to the letter of the Committee on Regional Development,

–  having regard to the report of the Committee on Budgets (A8-0314/2016),

A.  whereas the Union has set up legislative and budgetary instruments to provide additional support to workers who are suffering from the consequences of major structural changes in world trade patterns or of the global financial and economic crisis 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 to the IIA of 2 December 2013 in respect of the adoption of decisions to mobilise the European Globalisation Adjustment Fund (EGF);

C.  whereas the adoption of the EGF Regulation reflects the agreement reached between the Parliament and the Council to reintroduce the crisis mobilisation criterion, to set the Union financial contribution to 60 % of the total estimated cost of proposed measures, to increase efficiency for the treatment of EGF applications in the Commission and by the Parliament and the Council by shortening the time for assessment and approval, to widen eligible actions and beneficiaries by introducing self-employed persons and young people and to finance incentives for setting up own businesses;

D.  whereas Estonia submitted application EGF/2016/003 EE/petroleum and chemicals for a financial contribution from the EGF following redundancies in the economic sector classified under the NACE Revision 2 Division 19 (Manufacture of coke and refined petroleum products) and Division 20 (Manufacture of chemicals and chemicals products); whereas Estonia is not divided into NUTS-level 2 regions and whereas 800 out of 1 550 redundant workers eligible for the EGF contribution are expected to participate in the measures;

E.  whereas the application was submitted under the intervention of Article 4(2) of the EGF Regulation derogating from the criteria set out in point (b) of Article 4(1), which requires that at least 500 workers be made redundant over a reference period of nine months in enterprises operating in the same economic sector defined at NACE Revision 2 Division and located in one region or two contiguous regions defined at NUTS 2 level in a Member State;

F.  whereas facing the recent global oil market turbulences, the general decrease in Europe’s international trade position for fertilizers (to the benefit of China’s producers) and low-cost gas regions outside Europe, Eesti Energia AS, Nitrofert AS and Viru Keemia Grupp AS have closed down plants or reduced production resulting in the collective termination of work contracts;

G.  whereas Estonia decided to combine the redundancies in one regional application as the redundancies happened at the same place, during the same timeframe and involved redundant workers with very similar backgrounds;

1.  Agrees with the Commission that the conditions set out in Article 4(2) of the EGF Regulation are met and that, therefore, Estonia is entitled to a financial contribution of EUR 1 131 358 under that Regulation, which represents 60 % of the total cost of EUR 1 885 597 for personalised services consisting of support for formal studies, payment of the cost of training, training cost reimbursement for employers, labour market training, work practice, debt counselling, psychological counselling, study allowances relating to participation in formal studies, scholarships, transport and accommodation benefits for Estonian language training;

2.  Welcomes the very first EGF application tabled by Estonia; believes that the EGF could be a particularly valuable tool to help workers from countries with small economies and more vulnerable Union economies;

3.  Notes that the Commission respected the deadline of 12 weeks from receipt of the completed application from the Estonian authorities, on 6 July 2016, until finalising its assessment on compliance with the conditions for providing a financial contribution, on 28 September 2016, and notified it to Parliament on the same day;

4.  Notes that the Union gradually lost its top position in world chemicals sales to China, which increased its share from 9 % to almost 35 % in the same timeframe; recalls that the production of mineral fertilizers is highly energy intensive (gas prices make up to 80 % of total production costs); notes that due to falling oil prices, Estonian exports of mineral fuels decreased by 25 % during the first two months of 2016 compared to the same period a year earlier; notes that a high concentration of industries in Estonia are dependent on oil and gas prices;

5.  Points out that the impact of the redundancies on the local and regional economy and employment is expected to be significant;

6.  Welcomes Estonia’s decision to combine two economic sectors in one regional application, as the redundancies happened in the same region, as this will reduce the administrative burden and make it possible to organise joint measures for workers made redundant in both sectors;

7.  Welcomes the fact that a regional development strategy has been designed, which is outlined in the Ida-Virumaa Action Plan for 2015-2020[4], with logistics and tourism identified as potential growth sectors; acknowledges the fact that infrastructure projects have been launched in order to boost growth and to form a base for diversifying the economic structure;

8.  Notes the reason for the relatively low number of redundant workers expected to participate in the measures (800 out of 1 550), which can be explained by the desire to target the most vulnerable workers on the job market and also the fact that some workers had declared that they were not available for participation in the measures foreseen by Estonia; notes the relatively high percentage of non-Union citizens (63,3 %) as targeted beneficiaries;

9.  Notes that the EGF co-funded personalised services for the redundant workers include payment of the cost of formal studies, training cost reimbursement for employers, labour market training, Estonian language training, work practice and counselling; takes note that Estonia has provided the required information on actions that are mandatory for the enterprise concerned by virtue of national law or pursuant to collective agreements and has confirmed that a financial contribution from the EGF will not replace such actions;

10.  Notes that Estonia further declares that the coordinated package of measures is compatible with the shift towards a resource-efficient and sustainable economy and shows great potential to facilitate it, which is in line with Article 7 of the EGF Regulation;

11.  Welcomes the consultations with stakeholders, including trade unions, employers’ associations, enterprises and public employment services, that took place at the national and regional level to draw up the co-ordinated package of personalised services;

12.  Notes that actions under Article 7(4) of the EGF Regulation preparatory activities, management, information and publicity and control and reporting - represent a rather high share of the total costs (7,7 %);

13.  Recalls the importance of improving the employability of all workers by means of adapted training and the recognition of skills and competences gained throughout a worker's professional career; expects the training on offer in the coordinated package to be adapted not only to the needs of the dismissed workers but also to the actual business environment;

14.  Notes that the income support measures will constitute 27,25 % of the overall package of personalised measures, below the maximum 35 % set out in the EGF Regulation; further notes that those actions are conditional on the active participation of the targeted beneficiaries in job-search or training activities;

15.  Notes that the costs of technical assistance account for a relatively high percentage of the total costs; considers this to be justified in view of this being Estonia’s first EGF application;

16.  Notes that Estonia confirms that the eligible actions do not receive assistance from other Union financial instruments; reiterates its call on the Commission to present a comparative evaluation of those data in its annual reports in order to ensure full respect for existing regulations and that no duplication of Union-funded services can occur;

17.  Notes that these actions were drafted in line with the identified needs in the regional development strategy in Estonia and are compatible with the shift towards a resource efficient and sustainable economy;

18.  Asks the Commission to assure public access to the documents related to EGF cases;

19.  Approves the decision annexed to this resolution;

20.  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;

21.  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

on the mobilisation of the European Globalisation Adjustment Fund (following anapplication from Estonia– EGF/2016/003 EE/petroleum and chemicals)

THE EUROPEAN PARLIAMENT AND THE COUNCIL OF THE EUROPEAN UNION,

Having regard to the Treaty on the Functioning of the European Union,

Having regard to Regulation (EU) No 1309/2013 of the European Parliament and of the Council of 17 December 2013 on the European Globalisation Adjustment Fund (2014-2020) and repealing Regulation (EC) No 1927/2006[1], and in particular Article 15(4) thereof,

Having regard to the Interinstitutional Agreement of 2 December 2013 between the European Parliament, the Council and the Commission on budgetary discipline, on cooperation in budgetary matters and on sound financial management[2], and in particular point 13 thereof,

Having regard to the proposal from the European Commission,

Whereas:

(1)  The European Globalisation Adjustment Fund ('EGF') aims to provide support for workers made redundant and self-employed persons whose activity has ceased as a result of major structural changes in world trade patterns due to globalisation, as a result of a continuation of the global financial and economic crisis, or as a result of a new global financial and economic crisis, and to assist them with their reintegration into the labour market.

(2)  The EGF is not to exceed a maximum annual amount of EUR 150 million (2011 prices), as laid down in Article 12 of Council Regulation (EU, Euratom) No 1311/2013[3].

(3)  On 11 May 2016, Estonia submitted an application to mobilise the EGF, in respect of redundancies in Eesti Energia AS, Nitrofert AS and Viru Keemia Grupp AS in Estonia. It was supplemented by additional information provided in accordance with Article 8(3) of Regulation (EU) No 1309/2013. That application complies with the requirements for determining a financial contribution from the EGF as laid down in Article 13 of Regulation (EU) No 1309/2013.

(4)  In accordance with Article 4(2) of Regulation (EU) No 1309/2013, the application from Estonia is considered admissible since the redundancies have a serious impact on employment and the local and regional economy.

(5)  The EGF should, therefore, be mobilised in order to provide a financial contribution of EUR 1 131 358 in respect of the application submitted by Estonia.

(6)  In order to minimise the time taken to mobilise the EGF, this decision should apply from the date of its adoption,

HAVE ADOPTED THIS DECISION:

Article 1

For the general budget of the Union for the financial year 2016, the European Globalisation Adjustment Fund shall be mobilised to provide the amount of EUR 1 131 358 in commitment and payment appropriations.

Article 2

This Decision shall enter into force on the day of its publication in the Official Journal of the European Union. It shall apply from [the date of its adoption][4]*.

Done at [...],

For the European Parliament  For the Council

The President  The President

  • [1]   OJ L 347, 20.12.2013, p. 855.
  • [2]   OJ C 373, 20.12.2013, p. 1.
  • [3]   Council Regulation (EU, Euratom) No 1311/2013 of 2 December 2013 laying down the multiannual financial framework for the years 2014-2020 (OJ L 347, 20.12.2013, p. 884).
  • [4] *   Date to be inserted by the Parliament before the publication in OJ.

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 Article 12 of Regulation (EU, Euratom) No 1311/2013 laying down the multiannual financial framework for the years 2014-2020[1] and of Article 15 of Regulation (EU) No 1309/2013[2], the Fund may not exceed a maximum annual amount of EUR 150 million (2011 prices). The appropriate amounts are entered into the general budget of the Union as a provision.

As concerns the procedure, according to point 13 of the Interinstitutional Agreement of 2 December 2013 between the European Parliament, the Council and the Commission on budgetary discipline, on cooperation in budgetary matters and on sound financial management[3], 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 the event of disagreement, a trilogue shall be initiated.

II. Eesti Energia AS, Nitrofert AS and Viru Keemia Grupp AS application and the Commission's proposal

On 28 September 2016, the Commission adopted a proposal for a decision on the mobilisation of the EGF in favour of Estonia to support the reintegration in the labour market of workers made redundant to Eesti Energia AS, Nitrofert AS and Viru Keemia Grupp AS operating in the NACE Rev. 2 Division 19 (Manufacture of chemicals and chemical products ) in the Ida-Virumaa county (NUTS level 2: EE00- Eesti[4]).

This is the ninth application to be examined under the 2016 budget and the 2nd for the manufacture of chemicals and chemical products sector, the 1st application for the manufacture of coke and refined petroleum products sector and refers to the mobilisation of a total amount of EUR 1 131 358 from the EGF for Estonia. It concerns 800 workers made redundant.

The application was sent to the Commission on 11 May 2016 and supplemented by additional information up to 25 May 2016. The Commission has concluded, in accordance with all applicable provisions of the EGF Regulation, that the application meets the conditions for a financial contribution from the EGF.

The personalised services which are to be provided to workers made redundant consist of 10 types of measures:

•  Support for Formal Studies- Payment of the Cost of Training

•  Training Cost Reimbursement for Employers

•  Labour Market Training

•  Estonian Language Training

•  Work Practice

•  Debt Counselling

•  Psychological Counselling

•  Study Allowance relating to the participation in formal studies

•  Scholarship, Transport and Accommodation Benefit for Estonian Language Training

•  Mobility Allowance

According to the Commission, the described measures constitute active labour market measures within the eligible actions set out in Article 7 of the EGF Regulation. These actions do not substitute passive social protection measures. Moreover, the package of measures proposed is in line with the needs identified in Estonia’s regional development strategy 2014-2020[5] as well as the Ida-Virumaa Action Plan 2015-2020[6]. Estonia further declares that the coordinated package of measures is compatible with the shift towards a resource-efficient and sustainable economy and shows great potential to facilitate it.

The Estonian authorities have provided all necessary assurances regarding the following:

•  the principles of equality of treatment and non-discrimination will be respected in the access to the proposed actions and their implementation,

•  the requirements laid down in national and EU legislation concerning collective redundancies have been complied with,

•  the dismissing enterprises, which have continued their activities after the lay-offs, have complied with their legal obligations governing the redundancies and provided for their workers accordingly,

•  the proposed actions will not receive financial support from other Union funds or financial instruments and any double financing will be prevented,

•  the proposed actions will be complementary with actions funded by the Structural Funds,

•  the financial contribution from the EGF will comply with the procedural and material Union rules on State aid.

III. Procedure

In order to mobilise the Fund, the Commission has submitted to the Budget Authority a transfer request for a global amount of EUR 1 131 358 from the EGF reserve (40 02 43) to the EGF budget line (04 04 01).

This is the ninth transfer proposal for the mobilisation of the Fund transmitted to the Budgetary Authority to date during 2016.

The trilogue procedure shall be initiated in the event of disagreement, as provided for in Article 15(4) of the EGF Regulation.

According to an internal agreement, the Employment and Social Affairs Committee should be associated to the process, in order to provide constructive support and contribution to the assessment of the applications from the Fund.

ANNEX: LETTER OF THE COMMITTEE ON EMPLOYMENT AND SOCIAL AFFAIRS

CF/jb

D(2016)43378

Mr Jean Arthuis

Chair of the Committee on Budgets

ASP 09G205

Subject: Opinion on the mobilisation of the European Globalisation Adjustment Fund (EGF) for the case EGF/2016/003 EE/petroleum and chemicals

Dear Chair,

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/2016/003 EE/petroleum and chemicals 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 is based on Article 4(2) of Regulation (EU) No 1309/2013 (EGF Regulation) and relates to 1 550 workers made redundant in three entreprises operating in in the economic sectors classified under the NACE Revision 2 Division 19 (Manufacture of coke and refined petroleum products) and Division 20 (Manufacture of chemicals and chemical products):

B)  Whereas, in order to establish the link between the redundancies and major structural changes in world trade patterns due to globalisation, Estonia argues that it is a small open economy, highly reliant on exports of goods and services which has suffered from recent global oil market turbulences and a general decrease in Europe's international trade position; whereas regions outside Europe with low-cost gas have a competitive advantage when producing fertilizers; whereas the EU’s share of world chemicals production has decreased while China, the rest of Asia and the USA have seen their shares increase;

C)  Whereas 70,6% of the workers targeted by the measure are men and 29,4% are women; whereas 41,8% are aged between 55 and 64 years and 47,5% between 30 and 54 years;

D)  Whereas this is the first EGF application from Estonia.

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 Estonian application:

1.  Agrees with the Commission that the intervention criteria set out in Article 4(2) of the Regulation (EU) No 1309/2013 are met and that, therefore, Estonia is entitled to a financial contribution of EUR 1 131 358 under this Regulation which represents 60% of the total cost of EUR 1 885 597;

2.  Notes that the Commission respected the deadline of 12 weeks from the reception of the completed application from the Estonian authorities, on 6 July 2016, until finalising its assessment on the compliance with the conditions for providing a financial contribution, on 28 September 2016, and notified it to Parliament on the same day;

3.  Emphasises that the Ida Veruna region is facing considerable challenges due to its location and demography as it is relatively remote, has a high proportion of Russian speakers living in urban settlements formed around one or two production plants and has a significantly higher unemployment rate than the national average;

4.  Welcomes Estonia’s decision to offering training measures aimed at making the redundant workers ready for employment in sectors the regional development strategy identifies as offering growth potential (logistics, tourism the production of timber, metals and construction materials);

5.  Notes that the EGF co-funded personalised services for the redundant workers include payment of the cost of formal studies, training cost reimbursement for employers, labour market training, Estonian language training, work practice and counselling;

6.  Welcomes the consultations with stakeholders including trade unions, employers’ association, enterprises and public employment services that took place at the national and regional level to drawn up the co-ordinated package of personalised services;

7.  Notes that the income supports measures will be 27,25% of the overall package of personalised measures, below the maximum 35% set out in the Regulation; and that these actions are conditional on the active participation of the targeted beneficiaries in job-search or training activities;

8.  Notes that the costs of technical assistance account for a relatively high percentage of the total costs; considers this to be justified in view of this being Estonia’s first EGF application;

9.  Welcomes Estonia’s decision to combine two economic sectors in one regional application, as the redundancies happened at the same place, as this will reduces administrative burden and make it possible to organise joint measures for workers made redundant in both sectors;

10.  Notes that the Estonian authorities have provided assurances that the proposed actions will not receive financial support from other Union funds or financial instruments, that any double financing will be prevented and that they will be complementary with actions funded by the Structural Funds;

11.  Welcomes Estonia’s confirmation that a financial contribution from the EGF will not replace actions the enterprise concerned is required to take by virtue of national law or pursuant to collective agreements;

12.  Recalls that in line with Article 7 of the Regulation, the design of the coordinated package of personalised services should anticipate future labour market perspectives and required skills and should be compatible with the shift towards a resource-efficient and sustainable economy; welcomes Estonia’s declaration that the coordinated package shows great potential to facilitate such a shift.

Yours sincerely,

Thomas HÄNDEL

EMPL Chair

ANNEX: LETTER OF THE COMMITTEE ON REGIONAL DEVELOPMENT

Mr Jean ARTHUIS

Chairman

Committee on Budgets

European Parliament

Subject:  Mobilisation of the European Globalisation Adjustment Fund

Dear Mr. Arthuis,

A Commission proposal for a decision to mobilise the European Globalisation Adjustment Fund (EGF) has been referred for opinion to the Committee on Regional Development. I understand that it is intended that a report on this will be adopted in the Committee on Budgets on 24 October 2016:

-  COM(2016)0622 proposes an EGF contribution of EUR 1 131 358 for 1 550 workers made redundant in the economic sectors classified under the NACE Revision 2 Division 19 (Manufacture of coke and refined petroleum products) and Division 20 (Manufacture of chemicals and chemical products), in Estonia.

The rules applicable to financial contributions from the EGF are laid down in Regulation (EU) No 1309/2013 of the European Parliament and of the Council of 17 December 2013 on the European Globalisation Adjustment Fund (2014-2020) and repealing Regulation (EC) No 1927/2006.

The Committee coordinators have assessed this proposal, and asked me to write to you reporting that the majority of this Committee has no objection to this mobilisation of the European Globalisation Adjustment Fund to allocate the above-mentioned amount as proposed by the Commission.

Yours sincerely,

Iskra MIHAYLOVA

RESULT OF FINAL VOTE IN COMMITTEE RESPONSIBLE

Date adopted

24.10.2016

 

 

 

Result of final vote

+:

–:

0:

29

7

1

Members present for the final vote

Jean Arthuis, Richard Ashworth, Reimer Böge, Lefteris Christoforou, Jean-Paul Denanot, Gérard Deprez, José Manuel Fernandes, Eider Gardiazabal Rubial, Jens Geier, Esteban González Pons, Ingeborg Gräßle, Iris Hoffmann, Zbigniew Kuźmiuk, Vladimír Maňka, Ernest Maragall, Sophie Montel, Siegfried Mureşan, Victor Negrescu, Jan Olbrycht, Younous Omarjee, Paul Rübig, Patricija Šulin, Eleftherios Synadinos, Isabelle Thomas, Inese Vaidere, Monika Vana, Daniele Viotti, Marco Zanni, Auke Zijlstra, Stanisław Żółtek

Substitutes present for the final vote

Heidi Hautala, Alain Lamassoure, Stanisław Ożóg, Tomáš Zdechovský

Substitutes under Rule 200(2) present for the final vote

John Stuart Agnew, Linda McAvan, Virginie Rozière
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