Debates

Monday, 19 November 2012 - Strasbourg

26. Social Business Initiative (short presentation)

  President. − The next item is the report (A7-0305/2012) by Heinz K. Becker, on behalf of the Committee on Employment and Social Affairs, on Social Business Initiative – Creating a favourable climate for social enterprises, key stakeholders in the social economy and innovation 2012/2004(INI)).

  Heinz K. Becker, rapporteur. − (DE) Mr President, Commissioner, ladies and gentlemen. With the Social Business Initiative, Europe is demonstrating its commitment to social action very proactively, on the one hand to accommodate demographic change and, on the other hand, to answer the challenges of the labour market and the growing need for social benefits and services, in both the ‘white’ economy (health and social care) and the ‘green’ economy. That means in the context of a broader understanding of ‘social’ which encompasses not only the traditional areas of health, support services, education and care but also the environment. The European initiative on positive action to develop social enterprises was backed by the European Parliament’s Committee on Employment and Social Affairs through extremely constructive cooperation. My sincere thanks go to the shadow rapporteur, the committee secretariat and the Commission, also to my parliamentary assistant.

The great interest in this initiative that exists in the European Parliament is also borne out by the 280 and more amendments and 30 or so compromise amendments, which ultimately secured overwhelming approval of the report in the Committee on Employment and Social Affairs.

These are the key points in the report: we will encourage a future rise in demand for innovative products and services by creating a new and innovative social business climate – specifically on behalf of young people who will find new, attractive and promising career opportunities here. There is great potential here – and what could be more important at the present time?

We want to strengthen and encourage all social enterprises that have hitherto been successful, namely associations, cooperatives, mutuals, social foundations and – for the first time – all those who, on the basis of personal and private initiatives, as sole traders or team players in the category of small and medium-sized enterprises, will avail themselves of the growing number of market opportunities to meet the need for social services and achieve social objectives with true innovative commitment. Yes, our report states that the social economy is part of the eco-social market economy as well as of the European single market, so it stands on an equal footing with all other corporate forms. There is one paramount criterion for social businesses: they must produce a demonstrable social effect within society – whether it is childcare for working mothers, care for dementia patients, advice on switching to green technologies or a restaurant that provides work for young unemployed people. The Global Social Business Summit held in Vienna 10 days ago was based on thousands of different examples.

The definitions of social business are drawn from the EU’s Programme for Social Change and Innovation and are compatible with other reports. Social Business has proved itself crisis-resistant. We want better access to funding, including the new Social Investment Fund, which together with a labelling system, a quality mark, will attract new investors and cooperation partners. However, we also want better access to public procurement. We believe there must be eligibility for funding under all the EU’s programmes. We want practicable parameters for social business Europe-wide, and I hope that this communication means we shall have massive support from the Commission. I am hoping for majority support in tomorrow’s plenary. Social business has enormous potential as a new and powerful instrument for helping to solve social problems, thereby ensuring that Europe remains the world benchmark for social action.

Catch-the-eye procedure

  Miroslav Mikolášik (PPE). – (SK) Mr President, social enterprises providing services of general interest represent 10 % of all European businesses and employ at least 11 million people in the European Union.

However, support of social enterprises through financial resources at local, regional and national level must reflect the economic viability of the business concerned, because it is undesirable for a business to depend exclusively on subsidies for survival and, after provision of these subsidies comes to an end, to be threatened with complete closure. If, in fact, a business is not capable of survival, an evaluation is really needed of whether it should ever actually have been set up on the social enterprise basis. In this connection, we should consider introducing financial support that will be preceded by an analysis of efficiency and of social return on investment, in order to develop the investment market and make it more transparent. However, many businesses face a lack of clear information about the possibilities of such financing and it can be complicated to obtain this information.

I should put it briefly: we ought to have clearer, simpler rules.

  Anthea McIntyre (ECR). – Mr President, I would like to thank Mr Becker very much for all his work on this report and his cooperation with all the shadows throughout. Social businesses can contribute enormously towards employment, particularly for the disabled and disadvantaged, but I think it is very important that we recognise that social businesses are real businesses and should make profits and reinvest them. I am as keen to reduce administrative burdens for social enterprises as I am for any other kind of SMEs.

In the UK I have seen at first hand the wonderful work done by Royal British Legion Industries. A social enterprise employing disabled people, they compete in the open market and they succeed. They belong to a European-wide organisation called Homabilis, sharing good practice and cooperating right across the EU. They deserve our support.

  Roberta Angelilli (PPE). – (IT) Mr President, ladies and gentlemen, social business has a high resilience to crises and solid business models, as well as meeting all the objectives of the 2020 strategy. Support for social businesses brings economic advantages, but it is primarily in the very nature of their activities and their modus operandi to help to build a more cohesive, democratic and active society that contributes to job creation.

Accordingly, initiatives to improve the legal and fiscal environment and a European social label – the principle of the most economically advantageous tenders rather than the lowest cost in public procurement contracts – will help to create financial independence and a highly innovative eco-social market economy. For this reason, I compliment Mr Becker on his excellent work.

  Silvia-Adriana Ţicău (S&D). – (RO) Mr President, social enterprises employ at least 11 million people in the EU, accounting for 6 % of the entire EU workforce and 10 % of all European businesses. EU Structural Funds and programmes play a significant role in facilitating access to financing for social enterprises. For this reason, access to EU funding needs to be simplified, while allowing for adequate flexibility at Member State level.

I would stress the importance of a strategy and of measures promoting social entrepreneurship and innovative social enterprises, especially with regard to young and disadvantaged people. We call for the Erasmus for Young Entrepreneurs programme to be continued and for its attractiveness and visibility in the social economy to be improved.

  Elena Băsescu (PPE). – (RO) Mr President, I would like to congratulate my colleague for his work on this report. We are currently facing a growth in demand for social services, primarily as a result of demographic changes. Social enterprises have difficulty in finding the funding they need, according to their level of development. Therefore, those providing Services of General Interest need incentives.

I think that access to private finance should be ensured first and foremost, but EU funds should also be used to support social enterprises. Similarly, Member States could adapt the legal framework, improving access to public procurement contracts. Not least, the visibility and management ability of social entrepreneurs need to be improved. This could be done partly through programmes like Erasmus for Young Entrepreneurs.

  Iosif Matula (PPE). – (RO) Mr President, social entrepreneurs are known for their ambition and persistence, using their energies to identify solutions to the problems faced by society. They are visionaries, but also realists, whose work changes as the social system adapts to the needs of the community. Global financial institutions recognise the benefits of investing in development, by supporting social entrepreneurs, and they usually prefer to fund them rather than social aid programmes.

I am convinced that social enterprises provide the necessary link between the private sector, driven by maximising profit, and the public sector, which needs to respond to social needs. Combining these two approaches makes payments more efficient and reduces losses, with direct benefits for the citizen. Social enterprises should benefit from the support of European funds of the prudential investors’ type, and be able to access a range of financial instruments. They also need the support of the national, regional and local authorities, both where financing is concerned and also in promoting them to give legitimacy to their social entrepreneurship initiatives.

  Evelyn Regner (S&D). – (DE) Mr President, the Commission, and you especially, Mr Barnier, show great initiative, great engagement, when it comes to social business. That is good, and very welcome. I have one major criticism of this Commission proposal, however: the basic idea of opening up social business to financial market operations is not a good one.

The Commission bases itself on the premise of commercial, profit-making enterprises. For a field where lenders or businesses have an overwhelmingly social remit and reinvest their profits, the European fund is not the right instrument. Private investors investing long term in not-for-profit projects already have a range of options: development banks or public-private partnerships, to name just two. Social business must continue to be organised democratically on a basis of solidarity.

  Petru Constantin Luhan (PPE). – (RO) Mr President, although they represent approximately two million businesses and 11 million employees, social enterprises in the EU have to make do with an underdeveloped funding system. I therefore feel it is absolutely essential to promote additional means of funding, both nationally and at EU level.

One solution would be to simplify access to the relevant structural funds under the 2014-2020 multiannual financial framework, and another could be to include special arrangements under the European Social Fund, the European Regional Development Fund, the Horizon 2020 Fund and the Programme for Social Change and Innovation, for the use of microfinance and social entrepreneurship. This is the only way we can guarantee adequate support for social enterprises, which promote high-quality jobs, combat poverty and social exclusion, and invest in education and vocational training for citizens of the EU.

  Csaba Sógor (PPE). – (HU) Mr President, we know that the social dimension of the economic and financial crisis will make its presence felt more than ever in the period to come. More and more of us think that, while dealing with the European crisis, bringing down sovereign debt and reaching budget-deficit goals, we have paid too little attention to the social consequences of the crisis. In recent years, economic matters have ruled out all other aspects, and citizens rightly feel that nobody has come up with an answer to growing unemployment, the problems of education systems or the phenomenon of poverty. The governments of the Member States know very well what the consequences will be if they ignore certain social demands. Now is the time for social matters to be given particular attention at the level of European policy. This, however, will require joint efforts on the part of the Council, the Commission and Parliament. We cannot allow European countries to sacrifice their developed social systems on the altar of crisis management.

(End of catch-the-eye procedure)

  Michel Barnier, Member of the Commission. − (FR) Good evening, Mr President, ladies and gentlemen, my thanks to Mr Becker and each of the speakers in this debate on what I believe to be a major topic, one on which we have been working for several months with my colleagues Mr Tajani and Mr Andor, in order to draw up a roadmap for social entrepreneurship. We know that it accounts for several percentage points of European GDP, through businesses in all their various forms across the 27 countries of the European Union, and several millions of jobs, and has a genuine capacity for innovation, commitment and investment.

Mr Becker, the report you are presenting is extremely important because it consolidates the approach we have been developing on many lines and initiatives. We shall continue with the same determination, the same tenacity.

First on finance, as you know, in October 2011, we proposed that social enterprises, the social economy, should be an investment priority in the next generation of structural funds for the period 2014-2020. This, of course, is a Commission proposal that will have to be approved by Council and Parliament.

I am also happy to say that the inclusion of social enterprises in our draft programme for social change and innovation received widespread support. It was adopted on 6 October last.

In December, we also modernised the package on state aids to Services of General Interest by adopting measures favourable to social enterprises when they supply a social service.

On private financing, Ms Regner; Mr Becker, you have supported the draft regulation on European Social Entrepreneurship Funds proposed by the Commission on 7 December last. Ms Regner, these are private funds, and although I proposed this new instrument, it was not in order to use public funds but so that when, and it does happen, private investors, people who have private funds, wish to invest in a field or in businesses, for example start-ups with a social aim, there is a means of collating the private funds and directing them towards a social economy goal. There is, therefore, no contradiction with all sorts of other initiatives that sometimes use public funds.

I hope we will be able to reach an agreement on the social enterprise fund; we are really on the correct road, and I hope we will be able to find a solution, including on tax havens; a solution, if everyone in the Council and Parliament is willing to compromise, then maybe that will be possible, provided that the compromise is a dynamic one.

Regarding the legal framework, beyond the financial issues, I am aware that Parliament is attached to the idea of a European statute for associations. I am as well, and I strike a note of caution here by noting that, in 1991, a previous Commission proposal was blocked in Council and was therefore withdrawn.

Ladies and gentlemen, since 8 February 2012, we have made progress on another matter close to my heart, namely the status of the European Foundation; this is an initial step forward on this matter, and I hope that further progress can be made. In any event, I have recently met all major stakeholders in European foundations in all their diversity who support our initiative.

I would also like to make reference to the work done on modernising the ‘Public Procurement’ directives. This is another instance of a regulatory framework that can help social entrepreneurship to expand rapidly if the rules you adopt, as I hope you will, make it easier to define public procurement in terms of social integration, innovation and environmental protection.

As you know, work on our proposals is now well under way, and I hope that, in the coming weeks, we will be able to reach agreement on the new, simpler, better-defined framework for public procurement.

However, these initiatives are not everything; there is still much for us to do. That is why my colleagues, Mr Tajani, Mr Andor and I wanted the Single Market Act II, the 12 new key proposals that we shall put on the table, to include a control switch to protect consumers and encourage innovation and social cohesion.

As part of the framework of the Single Market Act II, we shall work on innovative instruments to measure the impact of social enterprises. In parallel, we shall conduct a screening exercise and take a snapshot of what social enterprises, in all their diversity, mean in the 27 countries of the European Union. As regards the impact of social enterprises, we will therefore have the means of enhancing their reliability for investors; this is another project noted in Mr Becker’s report.

Beyond the regulatory framework, we must do everything we can in terms of financial facilitation, to enhance visibility, knowledge, the pooling of good practice among social enterprises in Europe, as you have requested, studies, registrations on University Erasmus programmes, training, better usage of European programmes. We are not working alone on this matter, and in Brussels and Strasbourg we also need to establish a wide-ranging platform for debate. We have already made a start with a major conference in which some of you participated in November 2011. We established a group of experts with whom Mr Becker was able to hold discussions last June. This is the first time that the Commission has been accompanied in its own debates and in the drafting of certain texts by a group of experts on social entrepreneurship. My colleagues and I intend to host a further major meeting on social entrepreneurship at the beginning of 2014 to draw up a balance sheet of everything done during the five years leading up to that date and to launch new initiatives.

I would be pleased if all of you who wish to do so could participate in this major meeting on social entrepreneurship and the social economy at the beginning of 2014.

IN THE CHAIR: ROBERTA ANGELILLI
Vice-President

  President. − The debate is closed.

The vote will take place tomorrow.