Strengthening the Social Dimension of the Economic and Monetary Union

European Commission

László ANDOR

European Commissioner responsible for Employment, Social Affairs and Inclusion

Strengthening the social dimension of the Economic and Monetary Union

Press conference/Brussels, 2 October 2013

To be sustainable in the long term, Europe's Economic and Monetary Union needs to strengthen its social dimension.

The adoption of the Europe 2020 Strategy put social policy at the core of EU economic strategy for the first time, setting headline targets for raising the employment rate, reducing early school leaving, increasing the proportion of completing tertiary education or equivalent and lifting at least 20 million people out of poverty.

These targets are already shaping social policies in the EU. Key policies adopted and measures taken at EU level are being implemented, for example the April 2012 Employment Package, the December 2012 Youth Employment Package, and the February 2013 Social Investment Package.

The EU has also taken considerable steps forward in the last five years in terms of economic governance, providing financial lifelines to many vulnerable Member States and ensuring extensive coordination of Member States' economic policies.

The Communication adopted by the Commission today marks a further step towards consolidating the Social Dimension of Economic and Monetary Union.

In particular, the EU must rebalance the governance of Economic and Monetary Union to better address problems of divergence between eurozone countries' employment and social situations. The extent of this divergence has been underlined in the Commission's latest Quarterly Review of the EU's employment and social situation, also published today.

The objective is to detect major employment and social problems much earlier in order to take measures to better address the current crisis and prevent serious crises developing in the future.

The first essential step is to measure divergence between countries' employment and social situations. The Communication proposes that this divergence should best be measured by a specific Scoreboard that would highlight negative developments concerning:

overall unemployment
numbers of young people not in employment, education or training (the so-called NEETs)
the percentage of the working age population at risk of poverty
income inequalities as measured by comparing the richest 20% of the population with the poorest 20%
Real Gross Disposable Income of Households.

The Commission has proposed that the EU's and Member States' overall economic policies would take more account of employment and social issues through stronger surveillance and coordination of EU Member States' employment and social policies in the framework of the EU's yearly economic policy-making cycle, the European Semester.

Multilateral surveillance in the framework of the European Semester would therefore be better equipped to prevent employment and social problems as well as competitiveness and fiscal problems.

Such coordination would also encourage an approach based on giving incentives to reforms to address key employment and social problems (rather than a corrective approach). One good example of such an approach is the €6 billion Youth Employment Initiative that gives an incentive to Member States to implement the Youth Guarantee reforms agreed earlier this year.

Consultation with employer organisations and trade unions at EU and national level on both the definition of economic, employment and social policies and their involvement in the implementation will be essential. The Communication therefore outlines proposals for extending and intensifying such consultation.

EU structural and investment funds, and in particular the European Social Fund, are available to Member States to help them to implement their agreed employment and social policies and reforms. The Communication underlines the need for Member States to ensure greater targeting of EU structural and investment funds on sound employment and social policies when preparing their plans for spending these funds in the 2014-2020 period.

Finally in terms of labour mobility the Communication underlines the Commission's commitment to helping all those people that choose to work in another Member State to be aware of job opportunities there and to overcome any obstacles they may encounter.

The Commission looks forward to working with the EU's Council of Ministers, the European Parliament, the European Council and social partners to achieve rapid progress towards consolidating the social dimension of Economic and Monetary Union.