eunbil · GT0N1324 · 2006-05-31 00:00:00 — THE EUROPEAN UNION , 17 2006 from : Presidency to : Council (Employment, Social Policy, Health and Consumer Affairs) Subject : Conference on Interest (other business item) Delegations will find attached a note by the Austrian Presidency on the occasion of the above-mentioned conference. Information Note of the Presidency on the Subject and objective of the Conference The Conferences aim was to deepen the work initiated by Commissions and the following on services of general interest in the field of social services. In order to do so, the Conference analysed the socio-economic dynamics at play in this sector before probing into the notion of general interest and its application to social services as a basis for a discussion on the application of Community law in this field. Concrete cases within Member States were also presented. The Conference, opened by Commissioner pidla and the Austrian State Secretary for , Generations and Consumer Protection, Mr. Dolinschek, convened more than 200 representatives of the Member States, accession countries and candidate states, EU institutions, the social partners, NGOs and social service providers. Aspects of the discussion Many interventions showed that the time is ripe for a thorough examination of the position of social services in the Member States. On the one hand, the recently amended Commission proposal for a Directive on services in the internal market of and, on the other, the on social services of general interest in Union published shortly after the Conference, on 26.4.2006, showed the importance of the questions dealt with during the Conference. The following main issues were raised in the Conference: Social services of general interest are a core pillar of social model. They are essential for social cohesion, social inclusion and the implementation of fundamental rights. They contribute significantly to growth and employment and thus play an important role in the process. Indeed, social services are among the most dynamic sectors in the EU with an average employment growth exceeding by about (since 1998) the total economic growth (to 1.2%). to a growing and changing demand, social services of general interest have to undergo adjustment and modernisation processes putting pressure on public financing and provision. It is necessary to maintain and improve the quality of these services and to secure their sustainability at the same time. Quality is not only relevant to users but also represents an important issue for employers and employees in the sector who have to face challenges such as increased exposure to stress, a high level of shift and night work with wages below average, an ageing workforce and recruitment problems. The important contribution the market can make to the social services sector in terms of quality, efficiency and choice for users was mentioned several times. It was stressed at the same time that a market in social services needed a thoroughly designed regulatory framework which might be more complex than the legal framework necessary for public entities running these services. It was also pointed out that the analysis of the impact of market and competition forces should not only take due account of the interests of the providers but mainly focus on those of the users. It was recalled that social services of general interest shared the criteria common to all services of general interest but could be identified by additional elements distinguishing them clearly from other services of general interest. Some of the most frequently mentioned specific characteristics of social services are: their role in the implementation of fundamental social rights such as the dignity and integrity of the person; their functioning based on the principle of solidarity; the importance of user participation; the important role of volunteers; customised service provision and user protection; the asymmetry between providers and beneficiaries, as many users of social services are in a vulnerable position; the local dimension of the provision of social services and the proximity between providers and beneficiaries. The Conference also tackled the question of the scope of the Services Directive. While the scope and content of "health services" seem to be quite clear in the proposal for a Services Directive, the notion of "social services relating to social housing, childcare and support of families and persons in need" proposed by the Commission to be excluded from the scope of the Services Directive seems to need further clarification in order to secure also in legal terms the intended broad meaning as stated in the relevant recital. In this context the was widely expected to bring additional clarity by providing a description of social services and some criteria for their identification and definition. There was no doubt that under the Treaty in force social services would remain within the competence of the Member States (subsidiarity). Indeed, Member States are free to define the missions of general interest and to lay down the resulting principles of organisation provided that they are in compliance with the Community principles of proportionality, transparency and non-discrimination. When services of general economic interest are involved, the compatibility of their methods of organisation with the Treaty provisions (in particular competition and internal market) has to be guaranteed. Nevertheless, the concrete extent of this impact is not clear. Concerning state aid the Altmark/package has not solved all the problems. It is anyhow premature to evaluate to what extent the rather strict criteria set out in this package can be fulfilled by the providers of social services of general interest. It was feared that, on the one hand, the clear mandate from a public authority to provide a specific service of general interest is not always easy to prove and that, on the other, many social services receive subsidies from public entities which do not meet the criteria of a "compensation" (lump-sum subsidies or coverage of any deficit). There was no doubt that further measures at Community level were urgently needed to better allow for a framework in which social services of general interest could be modernised and function properly. Nevertheless, there was no common consent concerning the question which measure was best suited. Several speakers stressed that the open questions should be resolved by legal acts, such as a framework directive (without specifying the concrete content of such an instrument), instead of by ECJ case law, while others strictly rejected such an act with a view to the prevailing subsidiarity and preferred non-binding measures such as , exchange of information, studies etc. As an important step in this direction, the outline of a study on social services of general interest was presented. This study was recently assigned by the Commission to . It is to constitute a major fact-finding instrument involving all relevant stakeholders in the sector. The Conference took place at exactly the right time and addressed many essential issues and points that the Commission and Council should reflect on in the near future. Indeed, the Conference highlighted the specific features and the importance of the social services sector which is currently experiencing major modernisation trends. It has to be pointed out that despite the diversity existing in this sector across the Member States, some of the key issues are shared and make a deeper dialogue useful. The ongoing changes and modernisation trends in the sector should be analysed at national and European level. The Presidency welcomes that most of the points mentioned during the Conference were taken up in the released on and appreciates the proposed consultation as more in-depth exchanges are needed. There is a necessity to intensify the exchange of information with the aim of mutual understanding and learning. The participation of all stakeholders in the further work at national and Community level will be an important element of the process envisaged in the . The gender perspective needs to receive much more attention with a special focus on issues such as unpaid and undeclared work in the area of social services, the high percentage of women working in the sector as well as the quality of work and wage levels. There are still some open questions left in the context of the Services Directive. Further clarification will especially be needed as regards the extent to which social services are excluded from the scope of the Directive. Although the broad ambit of the recitals seems to include nearly all social services, further specification seems indispensable. It must, however, not be neglected that an exemption from the Services Directive does not immunise social services against the direct application of the principle of freedom to provide services under the Treaty. This issue also has to be further examined. Further clarification is also extremely necessary concerning the direct impact of the other Community principles on social services of general interest. Only such clarity will allow the stakeholders to further plan and modernise social services without constantly fearing possible infringements of Community principles. The study ordered by the Commission could be an important step forward in this direction. In this context, especially the Altmark/package needs a evaluation in order to see whether really all concerns of social services of general interest are addressed or further legal steps are necessary in order to achieve the requested legal certainty. All possibilities including legal acts should be discussed open-mindedly and all possible advantages and disadvantages for the best functioning of social services of general interest have to be evaluated before concrete steps are taken at Community level. 9459/06 AG/jl DG G II EN