Opinion on the Green Paper on European Social Policy: Options for the Union - Communication by Mr Flynn (94/C 148/10)

On 18 November 1993, the Commission decided to consult the Economic and Social Committee on the Green Paper on European Social Policy: Options for the Union - Communication by Mr Flynn.

The Section for Social, Family, Educational and Cultural Affairs, which was responsible for preparing the Committee's work on the subject, adopted its Opinion on 4 March 1994. The Rapporteur was Mr Vasco Cal.

At its 314th Plenary Session (meeting of 24 March 1994), the Economic and Social Committee adopted the following Opinion by a majority vote (one dissenting vote and ten abstentions).

Introduction

The immediate aim of the Green Paper is to launch a wide-ranging debate on the future course of social policy. The conclusions of this debate should then serve as a basis for the drafting of specific proposals in the form of a White Paper.

To help organize the debate, the Green Paper asks 65 questions on the various topics covered.

The Section felt that the present Opinion should seek to answer each of these questions (which are summarized in bold print at the beginning of each point), in order to give the Commission a more systematic picture of its views and thus make them as useful as possible.

Many of the subjects raised in the Green Paper have already been examined by the ESC. The relevant Opinions, which are mentioned throughout the text, should be considered alongside the present Opinion.

1. Priority issues common to the Member States

What key objectives could be widely accepted by the Member States and the partners concerned ?

1.1. When framing Community social policy, account must be taken of Member States' widely differing situations as regards economic and social development, education and vocational training levels, social security systems, and their preference for legislative or contractual relations. Nevertheless, many of the social problems facing them are similar, as are the measures being discussed both in the Member States and at Community level (rising unemployment and social exclusion, funding of social security). The OECD actually identifies an 'EC model' in its draft report for submission to the ministerial meeting in June 1994. A number of factors have created new conditions which must be borne in mind when framing social policies: the establishment of the internal market and the new conditions governing competition worldwide; free movement of goods, services, capital and persons; the increasing interdependency of national economies; and the entry into force of the European Union Treaty and the appended Social Protocol. The EU's stance on social issues, which affect the life and work of the vast majority of the EU population, will be a vital factor in support for the European integration process.

1.2. In the labour market field, the Committee has already argued on a number of occasions that stronger economic growth is a precondition - albeit an insufficient one - for creating more jobs (see the ESC Opinions on the economic situation in 1993 and the Resolution addressed to the Copenhagen Summit).

1.2.1. The White Paper presented by the Commission and approved by the Brussels Summit last December puts forward basic guidelines for achieving this objective, which is vital to the success of the Community's integration process. The Committee endorsed the approach taken by the White Paper, and deems it essential that the new economic development model and the guidelines and measures recommended in it be rapidly put into practice.

1.2.2. 'Harmonious and balanced development of economic activities' as specified in Article 2 of the Treaty, cannot be jeopardized by a downward alignment of social standards. The White Paper recognizes that the way out of the present recession and the future of the Community economy depend inter alia on the preservation of the European social model and the income and consumption levels which this model brings with it, as well as on an increase in consumer confidence. This is the only way to create the right climate for a resurgence in public and private investment, which will play a vital part in adjusting production structures and adapting to the new conditions governing competition worldwide.

1.2.3. Equally, the Green paper points out that the extent to which Europe succeeds in making progress towards the common social goals of the Union will depend substantially on its capacity to generate the necessary wealth. Europe is therefore compelled to be at the forefront of economic and technological progress.

1.2.4. The introduction to the Green Paper rightly notes that 'the next phase in the development of European social policy cannot be based on the idea that social progress must go into retreat in order for economic competitiveness to recover'. The Brussels summit concluded that 'the necessary adjustments must not call into question the model of our society, which is founded on economic and social progress, a high level of social protection and continuous improvement in the quality of life' (Part A, iii, An economy geared to solidarity, Presidency Conclusions). The funding difficulties currently facing many social security systems should be carefully analyzed in order to ascertain how existing resources could be better managed and better geared to present needs, how costs trends could be more effectively controlled, and how the funding systems could be financed.

1.3. In the field of social protection and exclusion, the objective must be the economic and social integration of all citizens.

1.3.1. In the present period of sluggish growth of the Community economy, with worsening long-term unemployment, the fight against poverty and social exclusion is an immediate priority, particularly at a time when budgetary difficulties might lead to the sidelining of measures to promote re-integration.

1.3.2. The main objective should be to help integrate people into employment and into society.

1.3.3. Many citizens are totally reliant on the social protection system in the event of unemployment, illness, permanent or temporary invalidity, old age, and all situations of social vulnerability.

1.3.4. The smooth operation of the Community economy depends partly on its ability to make full use of the human resources available. The overall performance of a country or economic area must not be built on a basis of high unemployment.

1.3.5. The social costs of unemployment cannot be ignored. They place a burden on the rest of the economy and on public finance, and are ultimately shared among the public, business and consumers. The drop in income generated by job losses is aggravated by the charges levied in order to finance benefits. Under-employment aggravates the effects of the recession, holding down consumer spending, as was recently recognized in a report on the employment situation in Europe drawn up under the auspices of the Council of Europe (Fifth Conference of European Employment Ministers, Malta, October 1993). The indirect social costs should also be considered for 'unemployment is creating a basis for social marginalization and thus a deterioration in associated social problems' (Opinion on Employment in Europe, Rapporteur: Mr Vasco Cal, OJ No C 161, 14. 6. 1993, p. 34).

1.4. Equality of opportunity must be a guiding criterion at all levels of social policy decision-making, and not only of those policies which relate directly to equal opportunities, whether for women, young people or disadvantaged groups.

1.4.1. The education system, which has played and continues to play a key part in equality of opportunity, must be tailored to changing needs. As well as teaching vocational skills, it must develop young people's ability to adapt to innovation and change, as this will lie at the heart of further training. Youth training provision should be extended so as to help raise average skill levels, particularly in the less developed regions, thereby enhancing economic and social cohesion.

1.4.2. The workplace should play a part in equality of opportunity, and it too is undergoing radical changes. The introduction of new technologies and new production processes means changes in the organization of production and greater participation, inter alia in the form of teamwork.

1.4.3. Young people are the group most seriously hit by lack of job prospects and of a useful role in society, as well as by the growing use of casual labour and the worsening position of the social security system brought about by demographic trends.

1.5. On the subject of training, there is broad agreement that the top priority for reconciling economic growth, competitiveness and employment must be to make better use of human resources, but this has not been translated into substantive political and budgetary measures.

1.5.1. Existing vocational qualifications in the EC are marked by a sectoral view of work and production, and are ill adapted to the changes now taking place or likely to take place in the short term (see the Information Report on vocational training, Rapporteur: Mrs Cassina, CES 587/92 fin).

1.5.2. Access to basic vocational training, and the promotion of access to further training, are vital, not only as the guarantee of a skilled workforce, but also to enable workers to adapt more rapidly to scientific and technological advances in production processes.

1.5.3. Training is also a precondition for improving sectoral and regional mobility.

2. Improving the employment situation (how to further develop the Community-wide framework for employment in order to promote a more employment-intensive pattern of growth; the role of the social partners; the role of Community action)

2.1. High unemployment and the worsening standard of employment, together with the relatively low activity rate within the Community economy, bring a need to analyze all possible ways of improving the situation so as to increase flexibility within firms while at the same time guaranteeing the necessary worker protection.

2.1.1. The Committee welcomes the Green Paper's proposal to reduce non-wage costs and change taxation and related contribution systems which hit the least skilled workers, as this will help reduce the disincentives to job creation. However, this proposal should also be analyzed in the broader context of the financing of social protection systems, an area facing serious difficulties.

2.1.2. Insufficient consideration has been given to the potential for employment growth in new activities and areas, and for locally generated jobs. This potential should be investigated thoroughly. The granting of incentives and a reduction in the administrative barriers impeding the setting-up of new businesses and activities could be beneficial here, although a clampdown is needed on cases where incentives have been misused, as this distorts competition. Public services play a vital part in guaranteeing equal treatment of citizens in both urban and rural areas, and they also have a major impact on employment. In recent years Europe has not created as many jobs as the United States in local services, and this is one of the main reasons for their diverging unemployment and overall productivity rates.

2.1.3. Local social structures should be reinforced and linked more closely at local and regional level, in order to take full advantage of their knowledge of the local economy, their interest in solving existing problems, and the synergies triggered by locally integrated activities. Studies of regional differences in job creation demonstrate the importance of local factors such as the degree of cooperation between firms, local authorities, trade unions and other social organizations.

2.1.4. The Commission document on a Community-wide framework for employment [COM(93) 238 final] acknowledges that changes to existing policies must be carried out 'in ways that do not exploit workers in a weak position in the labour market, or inhibit the development of the high value-added knowledge-based jobs which will be the key to future competitiveness' (last paragraph of point 3.1). The 'process of analysis and exchange of experience' which the Commission says is to be pursued 'in a structured and cooperative manner' should involve all the parties concerned, without prejudice to the Community-level consultation process laid down in the Treaties.

2.2. Negotiation between the social partners at the various levels (sectoral, inter-trade, company) is the best way to reach the necessary agreements, particularly as regards the introduction of new technologies, the development of new forms of work organization, and of new patterns of working time.

2.3. In recent years the Committee has voiced its views on such aspects of the organization of working time as part-time work, atypical work forms, and the reduction of working time. The Committee recognizes that the spread of part-time work has boosted employment, especially for women. However, it also notes that the new jobs created have not sufficed to maintain the overall volume of employment, because of the large number of full-time jobs which have disappeared over the same period. Flexibility within firms, so as to adjust working hours and the hours of plant operation in line with demand and workers' interests, must be negotiated with workers and their representatives at the appropriate level. A further extension of these forms of work will also depend on the minimum guarantees provided.

2.4. Community action will follow the line taken in implementation of the White Paper approved at the Brussels summit. The various debates taking place within Community bodies on similar or overlapping subjects, such as the present Green Paper and the White Paper on Growth, Competitiveness and Employment, should be better coordinated. This applies especially to the ensuing concrete proposals.

3. The move towards a quality-based production system

3.1. Human resource development (better linkage of retraining schemes to labour market needs; reconciling the right to training throughout life with the need to enhance qualifications and skills constantly; the separate treatment of education and training)

3.1.1. In many regions, a high level of unemployment goes hand in hand with a mismatch between qualifications and the skills required, a lack of specialized labour and a failure to meet firms' needs in some of the areas most affected by technological progress (see point 3.1.2.6 of the Opinion on Employment in Europe). In many regions, changes in economic activity have made many occupations obsolete, but the employment and vocational training systems have often proved unable to anticipate or respond to these changes.

3.1.1.1. In order to gear the education and training system more closely to real economic requirements and to the personal development needs of workers, the system must be made more flexible and its training content adapted so that the skills acquired are better tailored to labour market needs. This calls for a more active role on the part of the social partners and trade organizations.

3.1.1.2. In-company training is made increasingly necessary by changes in work organization. It must be underpinned by, and mesh with, an effective and flexible education system which is able to impart the broad basic training that is a prerequisite for the assimilation of subsequent training.

3.1.2. 'Every worker of the European Community must be able to have access to vocational training and to benefit therefrom throughout his working life. In the conditions governing access to such training there may be no discrimination on grounds of nationality' (point 15 of the Community Charter of the Fundamental Social Rights of Workers). In order to guarantee access to training throughout working life, alongside appropriate basic training and initial vocational training which guarantees young people access to an initial qualification that is formally recognized at least at national level, steps are needed to ensure that information about further training schemes is properly circulated so that all workers can benefit.

3.1.2.1. This means that further training must not be limited to companies, although it is here that its scale is greatest. An effective system of public and private training bodies, including institutes supported by the socio-economic organizations, is vital to supplement in-company training, which is restricted to the workers of the company concerned and often provides no paper qualification, making it difficult to use on the labour market. In-company training does not cover most small firms and fails to reach vulnerable groups such as the unemployed and women wishing to return to work after a period spent caring for their families (see the ESC Opinion on access to continuing vocational training, Rapporteur: Mr Nierhaus, CES 350/93).

3.1.3. It would appear from the above that education policy needs to be more related to economic and technological development needs and closely linked to the initial and further training system. Without close coordination between the education system and the vocational training system, and close ties with research and development, it will be impossible to rectify the training deficits resulting from earlier training periods and to improve the basic and further training of the trainers themselves (whether they be teachers, in-company instructors, or trainers in general).

3.1.3.1. Given the need for a sharp rise in existing skills in order to improve overall economic productivity, special attention should be paid to the training of the vast majority of employed workers. This is one of the reasons for extending training programmes in anticipation of industrial changes.

3.2. Measures to accompany a quality-based production system (labour standards and working conditions, labour market adaptability, and accompanying measures)

3.2.1. The factors which produced the Community's present high levels of structural unemployment are set to continue. They include the following:

- although demographic growth is less significant than in the past, the activity rate (relation between the population of working age and the working population) and the unemployment rate would suggest a 'non-employment' rate of around 25 % in the Community as a whole. This also explains why some 40 % of jobs created in the period 1985-1990 were filled by people - generally women - who were not previously on the labour market and were not registered as unemployed. The activity rate in the EU Member States is around 60 %, compared with around 70 % in the United States, Japan and the EFTA nations;

- the economic factors resulting from the new international division of labour are set to increase, with worldwide production overcapacity in a growing number of traditional industries, and firms setting up operations in other countries and subcontracting services to exploit the potential of information technology and advanced telecommunications;

- the accelerated drive for productivity gains is no longer directly tied to the rate of technological development, which has progressed at more or less constant rates over the long term. It now rests on the relocation of production operations in both traditional and advanced sectors, greater recourse to subcontracted labour, and transfers and cuts in the volume of employment at micro-economic level, and does not take account of the external costs which worsening unemployment causes (see point 1.2 above);

- macro-economic policy, which is affected by the objectives of Economic and Monetary Union and the priority accorded to the fight against inflation, has been based on restrictive policies and has not taken account of the fact that the Member States started out from differing bases, notably as regards their public deficit levels.

3.2.2. The changes now taking place in work processes differ from the technological developments of the past which were basically sectoral in nature. The effects of these changes - which concern all firms, including the smaller ones - could be turned to advantage in order to help make a qualitative leap in work processes. The case should therefore be considered for setting up training 'partnerships' embracing large companies and centres of specialist learning and knowhow, in order to lower training costs and guarantee the quality which the terms of competition demand.

3.2.2.1. There are a number of reasons for increasing workers' responsibilities, more effectively galvanizing their skills, creativity and 'savoir faire', and reviewing their career profiles: changing management structures which rely on greater decentralization, shorter and faster production cycles, more intensive use of plant, and the need to adapt to the firm's constantly changing environment.

3.2.2.2. The drive to update and enhance skills and qualifications must be actively pursued not only by workers themselves, but also by management. In other words, a joint effort must be made by both sides. However, it is not just the qualifications and skills of workers which need to be improved, but also those of managerial staff. As the Green Paper recognizes, human resource management requires a high standard in the areas of work organization, staff management and career development.

3.2.2.3. Company-level bargaining will tend to extend above and beyond its traditional areas, with changing practices and activities that could very usefully form the subject of framework agreements at the appropriate level (European, national or sectoral).

3.2.3. Analysis of 'active' and 'passive' employment policy measures has been triggered by the increasing difficulty of financing unemployment benefits and the growing need to finance active measures 'aiming at improving access to the labour market and jobs, job-related skills and labour-market functioning' (definition used in OECD Employment Outlook, July 1993, page 39).

3.2.3.1. It is true that expenditure on 'passive' measures is generally greater than on 'active' ones. The proposal to switch resources earmarked for unemployment benefits to the funding of active measures should not overlook the fact that redundant workers and those on early retirement have paid many years' social contributions in the belief that in return they would receive appropriate support if and when they needed it. Their situation differs from that of unemployed persons who have not paid contributions and who face moves to make their benefits conditional on their carrying out community work and/or attending vocational training courses.

3.2.3.2. 'Active' measures include training schemes, employment subsidies, the creation of socially useful jobs, measures to help disadvantaged or unemployed young people, and measures carried out by the public employment services.

3.2.3.3. The Community is in a position to exert a positive influence on financing priorities, especially in those Member States where ESF funding accounts for the bulk of expenditure on 'active' measures.

3.2.3.4. Use should be made of the experience gained from Community vocational training programmes (Comett, Eurotecnet, Force, Petra) and other pilot schemes. The good practices developed within the framework of these Community initiatives should be more firmly entrenched in training priorities, giving Member States the chance to draw on these innovative experiences, and their multiplier effect, when planning their vocational training policies.

3.2.3.5. The Committee has issued an Opinion on the proposed action programme for the implementation of an EC vocational training policy (see the Opinion on vocational training policy (Leonardo), Rapporteur: Mr Nierhaus, CES 380/94).

4. Stimulating solidarity and integration

4.1. Convergence of social policies (combination of income maintenance policies and active labour market policies, definition of specific convergence objectives, taxation and social security measures to encourage the economic and social participation of women)

4.1.1. In November 1991 the Committee issued an Opinion on the convergence of social protection objectives and policies (Rapporteur: Mr Pasquali, OJ No C 40, 17. 2. 1992, p. 91). The Committee supported the progressive convergence strategy proposed by the Commission, which included the establishment of common objectives and the adoption of measures covering sickness, accidents, maternity, unemployment, incapacity for work, old age, and the family.

4.1.2. While recognizing that Member States' social protection systems differ greatly, the Opinion pointed out that the problems facing them were broadly similar and drew attention to the need to take account of the implications of Economic and Monetary Union.

4.1.3. Social protection policies have played and continue to play an irreplaceable role in the European social system. Their main aim must be to assist the economic and social integration of all members of society and 'ensure an adequate standard of living for the entire legally resident population, providing aid for those with insufficient resources, in order to avoid social exclusion and guarantee essential health care' (point 2.7 of the abovementioned Opinion - OJ No C 40, 17. 2. 1992, p. 91).

4.1.4. The contribution systems should encourage women to play a full economic and social role. They should not erect barriers to women who wish to enter the labour market and should guarantee equal treatment.

4.1.5. The problems raised by the funding of social security have already spawned measures to improve management and contain costs, and to combat fraud and evasion. However, the changing ratio of contributors to beneficiaries, the granting of exemptions under a whole host of pretexts, the reduction in the contributions base, and the rise in the price of some services and in the expenditure thereon (e.g. health) are creating structural deficits and financing problems which urgently need to be addressed. The Committee is currently drafting an Own-initiative Opinion on this problem.

4.2. The fight against poverty and exclusion: prevention and rehabilitation (action to be taken, appropriate legislation and future action)

4.2.1. ESC Opinions have discussed the problems of poverty (Rapporteur: Mr Burnel, OJ No C 221, 28. 8. 1989, p. 10) and social exclusion (Rapporteur: Miss Maddocks). The Opinions analyzed the reasons for the recent rise in social exclusion: long-term unemployment, changes in societal values and declining solidarity, social fragmentation and the breakdown of family structures, absence of appropriate training and suitable housing, budget cuts in social programmes, and lack of opportunities to participate and communicate which make one unable to stand up for one's rights. Accordingly, the Committee's December 1993 Opinion on the 1994-1999 action programme to combat exclusion (Rapporteur: Miss Maddocks) suggested that the actions to be financed could include the 'accompaniment' of socially excluded individuals to boost their self-confidence (points 5.4 and 5.5 of Opinion in OJ No C 52, 19. 2. 1994, p. 4).

4.2.2. The Council Recommendation of 27 July 1992 on the convergence of social protection objectives and policies establishes a link between the convergence of social protection policies and the convergence of economic policies which, by promoting prosperity throughout Europe, will help counter poverty and exclusion. Various Opinions issued by the Committee in 1993 stressed the need to promote job creation and growth, since unemployment - especially youth and long-term unemployment - is one of the main factors behind the rise in exclusion.

4.2.3. The Committee Opinion on social exclusion unanimously advocated a Charter which, by recognizing the basic rights granted to all EU citizens, could help increase the priority accorded to measures to prevent the various types of exclusion. As exclusion is a structural problem, measures must do more than simply alleviate its effects. Although the public authorities have a special responsibility, the Committee also identified a need for 'a structured dialogue between the various actors in endeavours to combat social exclusion, including the Commission, the Member States, regional, municipal and local authorities, the social partners, non-governmental organizations and excluded people themselves' (point 5.4 of the abovementioned Opinion, OJ No C 352, 30. 12. 1993, p. 48), albeit without weakening existing forms of Community consultation.

4.2.4. The Committee has also voiced its concern at the cuts which budgetary constraints have led Member States to make in their social protection expenditure. It supported the increase in Community resources for the anti-poverty programme, and the inclusion of the fight against social exclusion among the objectives of the reformed Structural Funds.

4.2.5. The case for developing the unemployment benefit systems so that they support labour-market integration, job creation and self-employment should be considered carefully. The same care should be exercised regarding early retirement, particularly as life expectancy and the relation between contributors and beneficiaries of social protection would seem to argue in favour of the opposite. A study should be made of existing measures in this area which the Green Paper now proposes to generalize.

4.3. Youth opportunities and risks (transition from school to work; segregation in youth education; need to 'guarantee' a job, activity or useful training; lower 'entry wages' for young people)

4.3.1. In 1992 the Committee issued an Opinion broadly endorsing the Commission's Proposal for a Council Directive on the protection of young people at work (Rapporteur: Mr van Dijk, OJ No C 313, 30. 12. 1992).

4.3.2. The inadequacies of some education systems and the difficult employment situation of the last few years bring a need for appropriate steps to ease the transition from school to work. The German system has produced positive results in this sphere by combining school training with in-company apprenticeships. Countries which lack this business culture and emphasis on the value of work will have to make a prior effort to upgrade industrial employment and improve career prospects, eliminating unjustified differences in status. The promotion of a more technical and skills-oriented education is also important. In addition, the underlying philosophy of education and training should be radically revised so as to prepare young people for new forms of work organization and economic practice. Teachers and training supervisors need to be made fully conversant with new training needs.

4.3.3. A number of Member States have operated an exemption or reduction in social contributions for firms which employ young first job seekers. Whilst it may be acceptable to reduce social charges in order to help secure a first job, the institutionalization of wage discrimination under the pretext of 'facilitating' entry into the labour market is inadmissible, and improper exploitation of such situations should be severely punished. However, thought could be given to the possibility of the State funding a portion of pay, in the form of a training grant, for a limited period, provided that the money genuinely was used for this purpose.

4.3.4. Community contributions are vital for the implementation of measures in the countries covered by the Cohesion Fund, and here in particular the ESF-funded training schemes have proved the main instrument for easing the transition from school to work. However, the fact that there has been no qualitative analysis of vocational training programmes and pilot projects has limited the spin-off from the successful experiences to date and the improved assistance available. Article 126 of the Treaty on European Union puts vocational training on a new legal footing which should be fully exploited.

4.3.5. Access to training and the 'guarantee' of a job or socially useful activity, enshrined by legislation or decisions taken at Community level, could help to increase awareness of these questions, which are crucial to the future of European society.

4.3.6. The Committee is currently drafting an Opinion on the third stage of the Youth for Europe Programme.

4.4. The economic and social role of the elderly (building on the results of the European Year of Older People, debate on demographic trends and their consequences for employment and social security, etc.)

4.4.1. In November 1993 the Committee adopted an Opinion on older people in society (Rapporteur: Mr Roseingrave, Co-Rapporteur: Mr Laur, OJ No C 34, 2. 2. 1994, p. 61). This stated that 'the aim should be for older people to be viewed as a resource to society rather than as a social burden' (point 1.8.2); older people should be allowed to exercise their potential, for example in activities of social benefit which do not take work away from the unemployed. Within the framework of publicly recognized and supported voluntary bodies, they should be enabled to carry out activities in the following spheres: solidarity; voluntary social sector; support networks; activities of social benefit in towns, local neighbourhoods and rural areas; cultural activities for the elderly; travel; preventive health action; and mutual assistance structures (point 2.1.4). Moreover, it is a recognized fact that older people who are physically and mentally active will remain independent for longer (point 2.1.5).

4.4.2. Older people form an increasing proportion of society, and it is estimated that there are now around 70 million people over the age of 60 in the EU. Their problems, needs and potential should be recognized by a policy commitment to follow up the conclusions of the European Year of Older People and the relevant articles of the Charter of Fundamental Social Rights. To this end the Committee advocated the framing of a Community Charter of the Fundamental Rights of Older People, who should not suffer discrimination on grounds of age.

4.4.3. Alongside the problems common to all older people, the Committee felt that the specific problems facing certain groups should also be addressed (major dependency; early or phased retirement; older people living alone, or in rural areas, or in residential institutions) and that such groups should not be penalized by the social security systems.

4.5. Equal opportunities for third country immigrants (stimulation of integration policies, negotiation of a code of good practice through social dialogue, permanent residence entitlement)

4.5.1. In 1991 the Committee issued two Opinions on the status of migrant workers from third countries (Rapporteur: Mr Amato). The Committee called for the economic and social integration of migrants, equality of opportunities, and the framing of a Community programme of positive action; some initial proposals for such action were also put forward. The Committee discussed the legal basis for Community action in such fields as entry visas, immigration policies, and right of residence. It felt in particular that 'immigrants legally resident in a Member State should be able to move within the Community as freely as EC nationals' (point 2.6.3 of Opinion in OJ No C 339, 31. 12. 1991, p. 82), although it recognized that this did not necessarily mean that they could legally work in all Member States (point 3.3 of Opinion in OJ No C 159, 17. 6. 1991, p. 12. The above comments all concern immigrants who are legally resident in a Member State. The problem remains of how to resolve the situation of those who are not legally resident and who are prepared to accept all kinds of low paid work with no guaranteed rights, thereby aggravating labour market problems within the EU.

4.5.2. The Treaty on European Union establishes a new legal basis for cooperation in the field of justice and lays down corresponding procedures. Title VI of the Treaty covers such areas as immigration policy; residence conditions; rules on the crossing of external borders; and the fight against unauthorized immigration, residence and work. The Agreement on the European Economic Area includes provision for granting EFTA nationals covered by the Agreement the same rights of entry and residence as EU nationals.

4.5.3. The Commission has proposed a Council Decision and Regulation on the crossing of Member States' external frontiers and the granting of visas [COM(93) 684 final], whereby third country nationals resident in a Member State would not require an entry visa for a short stay. This is in line with the Committee's recommendation.

4.5.4. These issues were also discussed at a hearing held jointly by the ESC's Social Section and the European Parliament's Social Affairs Committee in Luxembourg in 1991, at which immigrants' organizations also had a chance to give their views. The conclusions of the hearing pointed to the need to coordinate policy on visas, right of asylum, right of permanent or temporary residence, criteria for reunification of families, and convergence of social security policies. The conclusions also called for the integration of immigrants and their families into trade unions and other associations, and into existing education and vocational training, housing and health systems. It was felt that this was the best way to counter discrimination and avoid the creation of ghettos. Mention was also made of the need to address the special integration problems of immigrant women, who should not be dependant on family ties.

4.6. Integration of the disabled (how best to progress, role of Community legislation, social partners and NGOs)

4.6.1. In May 1991 the Committee issued an Opinion on workers with reduced mobility (Rapporteur: Mrs Cassina, OJ No C 191, 22. 7. 1991, p. 2). In 1992 it adopted an Opinion on the Helios II programme (Rapporteur: Dame Jocelyn Barrow, OJ No C 79, 30. 3. 1992), which the Council approved in February 1993.

4.6.2. Noting that around 30 million people in the EU suffer from a physical, sensory or mental disability, the Committee called for more efforts to integrate them fully in society and employment.

4.7. The fight against racism and xenophobia (how to improve measures in the fields of education, information and legislation)

4.7.1. In all its discussions on the integration of immigrants, the Committee has shown an abiding concern for the fight against racism and xenophobia. In 1992 it adopted a Resolution on the subject (CES 1387/92), in which it voiced its solidarity with the victims and condemned their aggressors, and urged the Member States to take urgent and effective action. In a 1988 Opinion on the Proposal for a Council Resolution on the fight against racism and xenophobia (CES 1232/88, Rapporteur: Mrs Flather), the Committee stated that 'laws aimed at prevention or punishment of discrimination or acts inspired by racism and xenophobia need to be promoted, strengthened and applied vigorously' (point 1.4 of Opinion in OJ No C 23, 30. 1. 1989, p. 33). The Committee also underlined the importance of education at all stages, and stressed that the Community was 'in a unique position to create a society which is rich in its cultural diversity and united through its attachment to democratic values, social consensus and enterprise'.

4.8. Social policies and rural development (what further actions would prevent rural social decline ?)

4.8.1. In its Opinions on the reform of the Common Agricultural Policy and the development of rural areas, the Committee has spoken in favour of systems based on income support rather than price support to promote rural development, more especially in the least favoured regions.

4.8.2. It is important in rural areas, too, to maintain public services and safeguard their accessibility, thereby contributing to the equal treatment of citizens, no matter where they live. The creation and maintenance of services for rural communities must also be fostered.

5. Main policy objectives at European level (which sectors are most amenable to collective agreements, which are better suited to a legislative approach, the case for framework laws in the areas of minimum standards and equality of opportunity)

5.1. The Committee played a key role in the process which culminated in the drafting of the Community Charter of Fundamental Social Rights and the related action programme (see in particular the ESC Opinion of February 1989, Rapporteur: Mr Staedelin, OJ No C 126, 23. 5. 1989).

5.1.1. The Opinion argued that a guarantee of basic social rights should be enshrined in Community legislation. Specific initiatives were needed to meet the changed conditions brought by the single market. Social dialogue should also be promoted, particularly at sectoral level, and should involve all components of the social fabric.

5.1.2. The move to relaunch the debate on European social policy by issuing the Green Paper should not provide a pretext for 'forgetting' the proposals which are still before the Council of Ministers.

5.2. It should be left to the interested parties to decide which sectors are best suited to European-level negotiations and agreements between management and labour.

5.3. The practice in European social policy to date has not been the upward harmonization mentioned in the Treaty but rather the establishment of minimum conditions to be respected by the Member States. Moreover, differing national practices (with some countries tending to favour legislation, while others prefer collective agreements) have tended to water down the legislative initiatives envisaged in the Charter and action programme.

6. The single market and the free movement of people (what action should be taken at Community level to tackle the remaining legal barriers, development of the EURES network, equal treatment for all Community citizens resident in another Member State, social protection of mobile workers, extension of social security coordination, better information for lawyers dealing with Community legislation)

6.1. Of the four freedoms enunciated in the single market programme, the only one not yet fully operative is the free movement of people and more especially of workers. This is not only a matter of border controls, but also the lifting of legal obstacles, the coordination of social security schemes and the amendment of the Regulations on the application of social security schemes to employed and self-employed persons and their families moving within the Community, mutual recognition and equivalence of qualifications and equal treatment for workers moving within the Community and resident in a Member State, more especially as regards social and tax benefits and access to vocational training.

6.2. The EU has jurisdiction in almost all these fields and has a legal basis for taking the corresponding decisions. Despite this, even Commission proposals endorsed by the Committee and European Parliament remain before the Council. The amendment of Regulation 1408/71, on which Opinions were issued in early 1992 (Rapporteur: Mr Pearson, OJ No C 332, 16. 12. 1992, p. 1), is a case in point. The Council's political will as regards the free movement of workers cannot differ from that on the free movement of goods, services and capital.

6.3. The provision of information for bodies and individuals concerned with the free movement of people (such as lawyers and the judiciary) should be a matter of priority for which resources should be made available. Potential primary users should be helped to familiarize themselves with the Treaties and the relevant Regulations, Directives and case law, not least because many of them do not even realize how EU could affect their work. Such information should not only concern the free movement of people, but all areas of social policy (for instance occupational health and safety).

7. Promoting equal opportunities for women and men in a changing European society

7.1. In 1991 the Committee issued an Opinion on the draft Commission Recommendation on the protection of the dignity of women and men at work (Rapporteur: Miss Maddocks, OJ No C 14, 20. 1. 1992, p. 4). As well as criticizing the legal instrument chosen, the Committee noted that the 'package of suggested responsibilities, training policies, informal measures, counselling, official complaints procedures, investigations and disciplinary measures, appropriate to the size and structure of undertakings, will still only touch the tip of the iceberg' (point 1.7), because 'this is a general societal problem' which must be solved by basic education and campaigns of public awareness.

7.2. The Committee's 1990 Opinion on the Community's 'NOW' initiative to promote equal opportunities for women in the field of employment and vocational training (Rapporteur: Miss Maddocks, OJ No C 41, 18. 2. 1991, p. 32) endorsed 'the measures proposed concerning guidance, advice, pre-training, training and access to employment' and the complementary measures concerning childcare provisions (point 2.2.3). The Committee Opinion on the amendment of the Structural Fund Regulations endorsed the inclusion of the 'promotion of equal opportunities for men and women' in the Objectives of the European Social Fund (point 2.5.3 of Opinion in OJ No C 201, 26. 7. 1993, p. 52, Rapporteur: Mr Vasco Cal). Measures to promote female employment thus have an important part to play and should be allocated a corresponding budget.

8. The social transition to Economic and Monetary Union (formulating recommendations for attaining the objectives defined in Article 2, promoting convergence of social policies alongside convergence of economic policies)

8.1. In its Opinions on Economic and Monetary Union (Rapporteur: Mr Meyer-Horn), the Committee has noted that EMU must adhere to the principles of economic and social cohesion, and that social issues cannot be viewed in isolation from economic policy decisions. It also stated (point 2.1.1.1 of Opinion in OJ No C 34, 2. 2. 1994, p. 25) that, in the present recession, some of the convergence criteria can only be given medium-term priority.

8.2. Social considerations should also be taken into account in the multilateral surveillance which forms part of the economic convergence process. Convergence programmes should be revised and turned into 'convergence and economic recovery' programmes. The Committee also mentioned the need to include long-term and youth unemployment among the criteria against which progress in real as well as nominal convergence is measured (point 2.1.4 of the abovementioned Opinion).

8.3. The involvement of the socio-economic partners in these procedures is helpful not only because it offers the decision-making bodies a qualitative assessment that their services cannot usually provide; the representatives of the socio-economic interest groups are also better placed to explain the various facets of the European integration process to their members, who make up the vast majority of the population.

8.4. On several occasions during 1993, the Committee noted that the action taken by the ECOFIN Council fell far short of what was needed for economic recovery and employment growth, and even of the decisions taken at the European Summits. The holding of joint meetings with the Social Affairs and Employment Ministers may help, but it is not enough.

8.5. It is of crucial importance that the day-to-day economic and social decisions of the European Union underscore the commitment made in the debate on the White Paper on Growth, Competitiveness and Employment

9. Issues of social standards (social ground rules, prevention of social dumping)

9.1. A number of Committee Opinions have endorsed the call for basic social standards in all Member States.

9.2. The only area in which the Directives proposed in the social rights action programme were approved on schedule is that of health and safety at work.

9.3. Worker information, consultation and participation, with reference to the establishment of a European Works Council in Community-scale undertakings, will provide the first practical experience of the social policy agreement appended to the Treaty on European Union. The Commission proposal, issued at the end of 1990 in the wake of a Draft Directive dating from the 1970s, sparked conflicting views. These can now be hammered out face to face, and an agreement sought. The Committee adopted its Opinion on the subject in 1991 (Rapporteur: Mr Schmitz, OJ No C 120, 6. 5. 1991).

9.4. The need to combat certain distortions of competition led to the presentation of several proposals on atypical employment relationships. The Committee gave its Opinion on this in 1990 (Rapporteur: Mr Liverani, OJ No C 332, 31. 12. 1990, p. 167), but the proposals are still before the Council.

9.5. The Opinion on an equitable wage was revised following the Committee Opinion on the subject, and has since been approved by the Commission.

9.6. The need for basic standards in the new single market has been widely recognized. However, major obstacles have arisen as to how far they should go, and as to the best way of setting up and implementing them. The result has been uncertainty among the socio-economic operators which needs to be overcome. The European Union should speed up moves to establish these social standards in the light of the new possibilities opened up by the Treaty. As the Green Paper notes, 'consideration needs to be given to whether lighter and more flexible laws might not be better adapted to the diversity of different Member States, provided that this can be reconciled with the substantive results sought' (introduction to Part C, final paragraph).

9.7. The line taken in 1989, when the Heads of State and Government of 11 Member States adopted the Social Rights Charter and accompanying Action Programme, is drawing to a close (see point 5.3 above). The Treaty on European Union must be used as a framework for strengthening negotiations between the social partners at both national and EU level.

10. Reinforcing the social dialogue (priorities; accent on employment, education and training; involvement of the social partners in issues related to the single market and free movement and greater involvement in the problems of exclusion, equal opportunities, older workers, and integration of immigrant workers; ways of strengthening social dialogue)

10.1. The term 'dialogue between management and labour at European level' (Article 118b of the Treaty) was introduced by the Single Act. It is used to describe the meetings promoted by the European Commission to foster consultation, negotiation and consensus between the European Trade Union Confederation (ETUC), the Union of Industries of the European Community (UNICE) and the European Centre of Public Enterprises (CEEP).

10.2. This 'social dialogue', as it is known, has led to the approval of a number of Joint Opinions on a variety of subjects including training and labour market policies, and the drafting of a framework agreement between the three organizations.

10.3. The Agreement on Social Policy, approved by eleven Member States and annexed to the Treaty on European Union, introduced a new procedure for the adoption of social measures. This obliges the Commission to consult management and labour at European level before submitting proposals in the social policy field and allows them, if they so wish, to undertake negotiations which may lead to contractual agreements.

10.4. While the normal legal basis of the Treaty is retained, the Commission has to decide what legal basis to use each time legislation is initiated: it can choose between the Treaty, which will involve the normal consultation procedure (ESC and European Parliament Opinions), or the Annex, which allows the social partners to conclude contractual agreements that may be implemented by a Council Decision based on a Commission proposal.

10.5. In December 1993 the Commission adopted a Communication concerning the application of the Agreement on Social Policy [COM(93) 600 final], on which the Committee will issue an Opinion.

10.6. The present Opinion does not seek to anticipate or influence the Committee's stance on the above Communication. Nevertheless, certain concepts need clarification.

10.6.1. Under the terms of the Treaty, the Economic and Social Committee is the appropriate forum for weighing up the views of representatives of the socio-economic organizations, in a continual effort to secure the widest possible consensus between members, and for drawing up Opinions on Community proposals and initiatives before decisions are taken, or Own-initiative Opinions on matters of interest for the building of the Community.

10.6.2. The initiative taken by ETUC, UNICE and CEEP and enshrined in the Single Act involves a 'dialogue between management and labour' (Article 4 of the Agreement on Social Policy). Its ultimate goal is to encourage contractual relations, including agreements, as stipulated in the Agreement on Social Policy. Hence it is a negotiating process between the representative organizations of management and labour, who are empowered to conclude agreements which are binding on the interests represented (at all levels, whether inter-trade or sectoral).

11. Economic and social cohesion: the role of the European Social Fund (mechanisms to ensure that the outcomes of Community support for innovative programmes get translated into Member State policies; to ensure that action to develop human resources is taken into account in investment decisions; to remove disincentives to the take-up of training; to improve the anticipation of industrial change; to ensure that all the necessary partners play a full part in programming; and to ensure the funding of a system of trainee choice)

11.1. The Committee discussed the extension of the ESF objectives in its Opinion on the reform of the Structural Funds. The Committee endorsed the proposed new Objective 4 (anticipating industrial change) and the extension of Objective 3 to cover people excluded from the labour market.

11.2. Although the ESF merely tops up the resources allocated by the Member States to these objectives, ESF actions have failed to fully exploit the results achieved in other Member States and in the Community-funded innovative programmes, which were intended to serve as examples.

11.3. It would be very helpful if those in charge of vocational training schemes in Member States could be provided with assessments of other schemes, and with qualitative evaluations of their results and problems, notably as regards the finding of job placements for trainees. Experience shows that improving existing training schemes produces better results than setting up a number of piecemeal initiatives, however well justified these may seem.

11.4. Better coordination between the Commission departments dealing with this area would go a considerable way towards rationalizing existing resources and improving coordination between Member States.

11.5. Active involvement of the social partners should entail more than their present formal involvement. Employers' organizations and trade unions are allocating more and more resources to vocational training schemes and should receive more structured support from the Commission departments. This would also help to upgrade their involvement in the administration of Community and Member States' vocational training resources.

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2. International aspects (social policy priorities for the external relations of the Union, adoption of international labour standards)

12.1. The failure to include a social clause in the GATT agreement means that such a clause could be a priority for the new World Trade Organization, as the Committee noted in its recent Opinion on EU/Latin America relations (point 7.6 of CES 102/94). The Committee is currently drawing up an Opinion on the GATT agreement, and it will consider this aspect.

12.2. The Committee is also working on an Own-initiative Opinion on relations between the European Union and the International Labour Organization.

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3. Democratizing the process of social change and constructing a People's Europe (the case for a forum for the discussion of strategic problems; adoption of a statement of citizens' rights; information and awareness campaigns)

13.1. On 27 and 28 September 1993 the Committee held a Conference on the Citizens' Europe which discussed the issues raised under this heading (see the Conclusions of the Presidency, DI 91/93).

13.2. The work was grouped under three themes: I: The European citizen and a frontier-free Europe: vision or reality ?; II: The European citizen and quality of life in Europe: exclusion or solidarity ?; III: The European citizen and the EC institutions: harmony or divorce ?

13.2.1. As regards the first theme, the Conference concluded that 'Member States must act forthwith to adopt all the national provisions which are vital to the effective implementation of the Single Market', and called on the Community to 'press ahead with the harmonization of national fiscal legislation'. The Conference felt that 'the Community should be more alive to the views of consumers and users. The services offered by businesses, particularly in the financial sphere, should be more closely tailored to consumer expectations and more open'.

13.2.2. As regards the second theme, the Conference concluded that anti-exclusion measures presupposed 'policies at all levels - coordinated by the Community - to promote integration into work and other social activities, backed by measures focusing on (i) information for all citizens on their rights, (ii) basic and in-service training, and (iii) advice and support, but first and foremost positive action, seeking to optimize the human potential that exists in the EC'. The Conference also called for 'procedures for consultation, participation, and cooperation on all Community policies to develop at all levels the contribution of society to the European venture, while simultaneously ensuring a network of pooled resources in a spirit of solidarity among the various groups in our societies'.

13.2.3. As regards the third theme, the Conference considered that the Community institutions 'should take further action in the following areas: (i) the protection of fundamental social rights such as those enshrined in the European Convention for the Protection of Human Rights and Fundamental Freedoms; (ii) the need to pursue policies which outlaw all forms of discrimination, to include introduction of the requisite legal instruments; and (iii) the need for the Treaty to ensure that the Social Charter and the Protocol on social policy adopted at Maastricht are applied uniformly and without discrimination to all the citizens concerned'.

Done at Brussels, 24 March 1994.

The Chairman

of the Economic and Social Committee

Susanne TIEMANN