Opinion of the Economic and Social Committee on "Social Indicators"

(2002/C 221/13)

On 15 January 2002 the Economic and Social Committee, acting under Rule 23(3) of its Rules of Procedure, decided to draw up an own-initiative Opinion on "Social Indicators".

The Section for Employment, Social Affairs and Citizenship, which was responsible for preparing the Committee's work on the subject, adopted its opinion on 13 May 2002. The rapporteur was Mrs Cassina.

At its 391st plenary session (meeting of 29 May 2002), the Economic and Social Committee adopted the following opinion with 104 votes in favour, no dissenting votes and one abstention.

1. Report on indicators in the field of poverty and social exclusion

1.1. The Social Protection Committee (SPC) published a Report on Indicators in the field of poverty and social exclusion in October 2001, drawn up on the basis of the work carried out by the technical sub-group on Indicators, following the mandate from the Council. The conclusions of the European Councils of Nice and Stockholm called for the Council to adopt a set of indicators by 2001 to improve the understanding and comparability of poverty and social exclusion in the EU, with a view to achieving the goals set out in Lisbon designed to make a decisive impact on the eradication of poverty and exclusion(1) by 2010. This will support the development of National Action Plans to combat poverty and exclusion by improving the understanding of such phenomena and encouraging the exchange of good practice, in the context of the open method of coordination and the EC programme of action on this matter, established by a decision of the European Parliament and the Council(2). The proposed set of indicators, which should be considered as a whole rather than as a set of individual indicators, was drawn up to address social outcomes rather than the means by which they are achieved.

1.2. The methodology used by the sub-group on Indicators focused on analysing and comparing national plans for social inclusion with the emphasis on the following principles: the indicators used must capture the essence of the problem and must have an accepted interpretation and legal and scientific basis; they must be timely, whilst being open to revision; they must be mutually consistent; and they must be transparent and accessible to the public.

1.3. The set of indicators is divided up into primary indicators (covering the broad fields and the most important elements of social exclusion) and secondary indicators (supporting the primary indicators and describing other dimensions of the problem). Both these levels have been commonly agreed and defined by the Member States and will be used in the next round of National Action Plans on social inclusion. There may also be a third level of indicators that Member States themselves decide to include in their National Plans, to highlight certain specificities in particular areas, and to help interpret the primary and secondary indicators.

1.4. Primary Indicators:

- Low income rate after transfers (indicators 1a, 1b, 1c, 1d, 1e)

- Distribution of income (indicator 2)

- Persistence of low income (indicator 3)

- Median low income gap (indicator 4)

- Regional cohesion (indicator 5)

- Long-term unemployment rate (indicator 6)

- People living in jobless households (indicator 7)

- Early school leavers not in further education or training (indicator 8)

- Life expectancy at birth (indicator 9)

- Self-perceived health status (indicator 10).

1.5. Secondary Indicators:

- Dispersion around the 60 % median low income threshold (indicator 11)

- Low income rate anchored at a point in time (indicator 12)

- Low income rate before transfers (indicator 13)

- Distribution of income - Gini coefficient - (indicator 14)

- Persistence of low income (based on 50 % of median income) (indicator 15)

- Long-term unemployment share (indicator 16)

- Very long-term unemployment share (indicator 17)

- Persons with low educational attainment (indicator 18).

1.6. According to the Social Protection Committee, these indicators will enable several key aspects of this multifaceted phenomenon to be comparatively measured. The SPC recommends that further work be carried out in particular on:

- identifying further indicators on living conditions, including social participation, recurrent and occasional poverty, access to public and private services, territorial issues and indicators at local level, poverty and work, indebtedness, benefit dependency and family benefits;

- measuring the gender dimension in a more satisfactory manner;

- improving the accuracy and comparability of indicators on housing (decency of housing, housing costs and homelessness), literacy, numeracy, quality adjusted life expectancy, premature mortality by socio-economic status and access to healthcare, groups not living in families, especially the homeless but also those living in institutions (children's homes, orphanages, nursing homes in general, prisons).

1.7. Lastly, the SPC recognises the importance of greater involvement of excluded people in developing indicators and the need to explore the most effective means of giving a voice to the excluded.

2. General comments

2.1. In recent opinions on several social issues, the EESC has underscored the need and the urgency to have "high quality, comparable indicators"(3), "sufficiently detailed to give a true picture of the full implications of the framework analyses". It is especially important to develop such indicators in the field of social exclusion, given the complex and multifaceted nature of the phenomenon. The report in discussion puts forward an initial set of key indicators. The EESC strongly welcomes the work carried out by the sub-group on Indicators and by the Social Protection Committee, looks forward to further productive work from the SPC and confirms(4) that the EESC is most willing to cooperate and support its work as a key plank in the efficient development of National Action Plans to combat social exclusion.

2.2. The EESC welcomes in particular the dynamic approach which provides for the possibility to adapt and develop indicators. This is vital in order to exploit the full potential of the open method in this field, in which increasingly accurate and up-to-date comparisons of national situations and best practice are needed. The EESC also applauds the fact that the Sub-Committee on Indicators has already begun to examine in depth the key issues of illiteracy, cultural inclusion and housing with a view to identifying new indicators and to hone existing ones.

2.3. However it is important to check that the definition, and therefore the content, transparency and acceptability of indicators is sufficient and whether some indicators need further clarification in the short term. The EESC would like to contribute to this by submitting the following comments and suggestions to take work a step further.

3. Specific comments

3.1. The EESC notes that the majority of indicators concern income and considers that this could lead to an imbalance in relation to the indicators describing and comparing the qualitative aspects of social exclusion. The EESC is aware that the key indicators were chosen objectively and factually, but underscores the urgent need to define indicators that will give an accurate picture of social participation, access to services and self-perception of social exclusion. In several of its opinions, the EESC has maintained that an adequate level of income from employment is a necessary but insufficient condition to avoid or break out of the cycle of poverty and social exclusion. The EESC is not contradicting the conclusions of the Barcelona Summit(5) which state that "the best instrument for inclusion is employment"; it is simply providing a necessary clarification, in view of the multifaceted nature of exclusion.

3.2. The fight against social exclusion and poverty is part of the Lisbon strategy which was confirmed at the Barcelona summit indicating the need to significantly reduce the number of people risking poverty and exclusion by the year 2010(6). In its summary report, the Commission also indicated the goal of reducing such a risk by 50 % by the same year. Since the main feature of the Lisbon Strategy is the high quality of the European model of development in economic, social and technological terms, the EESC highlights the need to keep the concept of quality a priority at all times, both in measures to foster the employability of persons suffering from or at risk from exclusion, and in defining statistical instruments.

3.3. The indicators referring to education and skills need to be supplemented and refined. For example, "low educational attainment" does not cover a key element which the majority of excluded persons have in common: the inability to perceive themselves as citizens, and to fully understand and exercise their rights and duties. This is predominantly due to a poor basic education, but also and especially to a loss of awareness of themselves and of reality, worn down by the struggle to provide for their own basic needs. It is also essential to be able to tackle cases of "functional illiteracy" and therefore to be equipped with the instruments needed to analyse and quantify this phenomenon. In addition, the EESC notes that in its opinion on the programme to combat exclusion and poverty(7), it identified the risk of new forms of exclusion and poverty linked to the development of new technology. If excluded members of society cannot access the knowledge society, new forms of exclusion risk being created. This aspect should be tackled when drafting additional indicators.

3.4. The transfers mentioned in Indicators 1a, 1b, 1c and 1d refer to social security benefits granted to individuals or families. The EESC considers that comparisons could be distorted if the level of taxation and contributions is not taken into account in this equation, since it is well known that these figures differ greatly between Member States.

3.5. A further problem lies in calculating standards of purchasing power. Since the Eurostat criteria are automatically applied to determine this, as is done for surveys and reports on economic and social cohesion, distinctive regional and local factors are overlooked. Purchasing power can vary significantly within countries, regions and even within a single city. The provision for a third level of indicators enables Member States to develop their own method of assessment, broken down into regions or districts. The EESC hopes that Member States will give this problem due attention when defining indicators and when implementing National Action Plans to combat social exclusion.

3.6. The definition of Indicator 1b on "low income rate after transfers with breakdowns by most frequent activity status" should be supplemented with a reference to irregular or occasional activities and activities that are not officially registered (irregular or undeclared work). These types of activity are very common amongst excluded persons and are a factor in triggering or exacerbating the conditions for social exclusion.

3.6.1. The EESC is aware that it is extremely difficult to map irregular or undeclared employment, but underscores the fact that people working in irregular conditions, although benefiting from a certain level of income, do not have access to minimum guarantees and the protection granted by contract employment. They find themselves on the margins of society and indeed of the law. Thus every effort must be made to study irregular employment in depth in order to be able to tackle the phenomenon and those who profit from it, and aim to break the fatalist cycle that leads excluded and deprived persons to seek and accept this type of employment. There is a whole stratum of people whose earnings come from irregular work and who end up being not only excluded but even invisible from the rest of society. An indicator should be developed to anticipate the future risk of poverty caused by failure to pay contributions. Strong synergy between national plans for social inclusion, national plans for employment and fiscal policy is needed to tackle and overcome the scourge of undeclared employment.

3.7. Indicator 1c on types of family also appears not to take into due consideration the following two cases:

3.7.1. Large families ("three or more children" is too generic). It is true that households with many children to care for are in a minority, but this proportion changes for households living in extreme poverty, where many families have two or three times more children than average households.

3.7.2. One-parent families, for whom it makes a considerable difference whether there is one child to care for or two or more, especially if the children are very young. With more than one child to provide for it is practically impossible for a lone parent to earn a sufficient income. As a result, they become dependent on social security payments, sometimes increasingly so.

3.8. The EESC welcomes the fact that the indicator on "low income rate after transfers with breakdowns by tenure status" (1d), is soon to be developed, and that Eurostat has begun the procedure to commission a study on this matter. It highlights the importance of the Member States reaching an agreement on the definition of persons without a fixed abode, who represent a significant and specific percentage of excluded persons. Moreover, there should be a distinction between non rent-paying tenants and owners, since the latter still has to pay for the upkeep of the property, whilst the former needs only to pay subsistence expenses.

3.9. Indicator 9 (life expectancy) should be separate from disability-free life expectancy, which Eurostat already provides for the Member States. The phenomenon of non-self sufficiency is becoming increasingly common, especially amongst older people and disabled people, and this must also be taken into account.

4. Suggestions for the next stages of work

4.1. The Social Protection Committee notes that a series of new indicators should be defined and others improved, made more accurate and useful for comparative analysis (see point 1.6). The EESC believes that priority should be given to indicators measuring social participation and access to services, especially health services. The EESC also underscores its comments on education and skills (point 3.3), employment (point 3.6) and life expectancy (point 3.9).

4.1.1. The EESC does not believe that social participation should be measured against a common standard but against the possibility of access to social activities, entertainment and events, according to the relevant national customs and culture. There are many forms of exclusion which do not depend directly on the absence or inadequacy of income but on the absence of an open and motivating context that fosters human relations and group activities outside the family and workplace. The EESC believes that all Member States should develop their own third-level indicators for this, but also advocates holding a discussion to assess the possibility of defining certain common parameters.

4.2. Moreover the link between recurring or occasional poverty and the development of intermittent or very occasional employment should be studied to establish whether this type of employment has created a new category of excluded persons.

4.3. When working on indicators on indebtedness it is important to distinguish between indebtedness (which can usually be managed by an individual or household with a secure income) and over-indebtedness (which leads to inability to deal with the debt itself). This phenomenon affects Member States to differing extents but it is often the first step towards poverty and social exclusion. The EESC has followed this issue for a while and adopted an opinion on this matter at its plenary session of April 2002(8). At this stage the Committee would like simply to note that the problem of over-indebtedness cannot be tackled solely within the framework of National Action Plans to combat social exclusion and poverty since it is related to a network of bank and market mechanisms which should be broached by a combination of national and Community measures.

4.4. Lastly, clear indicators on the health and sanitation of excluded persons should be drawn up in reference to housing and the workplace, because the current set of indicators only contains a self-defined health status by income level (indicator 10). It could be interesting to develop indicators to assess not only access to medical and health services but also a person's awareness and inclination to keep in good health and to follow the basic rules of preventative medicine (gynaecological and dental check-ups, eye tests etc.), whilst taking into account the subjective differences between people living in poverty and people suffering from acute social exclusion, such as those with no fixed abode.

Brussels, 29 May 2002.

The President

of the Economic and Social Committee

Göke Frerichs

(1) In the Italian Publication the expression "lotta alla povertà e all'esclusione" is used except for titles in official documents. The term "emarginazione" (in stead of "esclusione") means the process that can lead to "esclusione" (to be excluded).

(2) European Parliament and Council Decision No 50/2002/EC of 7.12.2001 establishing a programme of Community action to encourage cooperation between Member States to combat social exclusion.

(3) Quality of employment, OJ C 311, 7.11.2001. Safe and sustainable pensions, OJ C 48, 21.2.2002.

(4) Proposal for a Council Decision setting up a Social Protection Committee, OJ C 204, 18.7.2000, p. 2.3, 2.3.1.

(5) Part III, Contributions to the debate, Employment and Social Policy.

(6) Presidency Conclusions, point 24.

(7) Proposal for a decision of the European Parliament and of the Council establishing a programme of Community action to encourage cooperation between Member States to combat social exclusion fillin titolo, OJ C 14, 16.1.2001, point 2.5.1.

(8) Household over-indebtedness in the European Union, OJ C 149, 26.1.2002.