Opinion of the Economic and Social Committee on the 'Communication from the Commission on the (Second) Integrated Programme for Small and Medium-sized Enterprises (SMEs) and the Craft Sector` (97/C 56/03)

On 26 September 1996, the Economic and Social Committee decided, in pursuance of Rule 23, second paragraph, of its Rules of Procedure, to draw up an Additional Opinion on the Integrated Programme for Small and Medium-sized Enterprises (SMEs) and the Craft Sector.

The Section for Industry, Commerce, Crafts and Services, which was instructed to prepare the Committee's work on the matter, drew up its Opinion on 2 October 1996. The Rapporteur was Mr Lustenhouwer.

The Economic and Social Committee adopted the following Opinion by 47 votes, with three votes against, at its 339th Plenary Session (meeting of 31 October 1996).

1. Introduction

1.1. The second integrated programme for SMEs translates into action the call made by the European Council at the Madrid summit on 16 December 1995 and the Resolution issued by the Council on 22 April 1996. The Resolution in particular appealed for closer coordination of policy-making in respect of both measures taken by the Member States and action taken under the various EU instruments and programmes to assist SMEs. Whenever the term 'SME` is used in this Opinion, it should be taken to mean small and medium-sized enterprises as described in the European definition, and embracing enterprises in all sectors of the economy, including the craft industry. Agricultural enterprises are, however, excluded.

1.2. The integrated programme comprises two parts:

- the various 'concerted actions` to be undertaken with the Member States and

- action by the European Union itself.

The latter measure includes the multi-annual SME programme which was contained in a Commission proposal to the Council dated 20 March 1996. On 11 July 1996 the ESC issued an Opinion strongly endorsing the Commission proposal ().

At its meeting in Florence on 21 and 22 June 1996, the European Council also expressly called upon the (Industry) Council to adopt the multi-annual programme by the end of 1996.

1.3. The Commission states that the aim of the integrated programme is to provide a coherent framework designed to improve the transparency of the many EU measures - both direct and indirect - to assist SMEs and to give these measures higher priority. We are, after all, in the final analysis, dealing with measures designed to help create jobs and generate economic growth.

2. General comments

2.1. The ESC supports the Commission approach. It trusts that the Council, too, will undertake to support the activities set out in the programme. Only once this happens will a real political signal be given to the effect that account must be taken of the interests of SMEs in all forms of EU policy. To this extent, the proposed programme thus clearly serves the purpose of sending out a political signal.

The ESC also endorses the idea of expanding upon the activities set out in the first integrated programme. There is as yet little tangible evidence of the results of the first programme and additional follow-up action is called for. The ESC notes approvingly that the second programme seeks to address in greater detail certain aspects of the first programme with a view to improving the business climate at all stages of the development of SMEs.

3. The five priority measures set out in the programme

3.1. The activities covered by the integrated programme fall under five main headings:

I. Simplifying and improving the administrative and regulatory business environment;

II. Improving the financial and fiscal environment for enterprises;

III. Helping SMEs to Europeanize and internationalize their strategies, in particular through better information and cooperation services;

IV. Enhancing SME competitiveness and improving their access to research, innovation, information technologies and training;

V. Promoting entrepreneurship and supporting special target groups.

3.2. The ESC has already given its views recently on many of the measures listed under the above headings. It has, for example, issued Opinions on the financing of SMEs and has repeatedly highlighted the importance of providing training for SME entrepreneurs and workers and circulating research findings to small businesses with an interest in technology in the industrial and craft sectors.

The comments set out in the paragraphs below therefore refer only to new points contained in the integrated programme.

4. Specific comments

4.1. In point B1 under Heading II ('Improve the financial and fiscal environment for SMEs`) (page 6), the Commission points out that it is planning to draw up a Recommendation to the Member States calling upon them to pay more attention to SMEs in proposals for joint financing under the European Regional Development Fund (ERDF). The ESC fully supports this approach and readily endorses the comments made on this matter by the Florence European Council to the effect that when decisions are taken on the use of the available margins of the Structural Funds, priority must be given to support for SMEs, acting in collaboration with the EIB ().

4.2. In point B2 (p. 7) the Commission announces that it intends to submit a communication on direct taxation. The ESC trusts that this communication will produce real, concrete proposals for assisting SMEs to engage in trans-national activities and reducing the attendant costs.

4.3. The Commission's views on the preparation of SMEs for the introduction of the euro (point B3, p. 8) tie in closely with the ESC's views on this matter, as set out in its Opinion on the Third Multi-Annual Programme for SMEs ().

4.4. Turning to Heading III ('Help SMEs to Europeanize and Internationalize their Strategies`) on p. 9, the Commission states in point A that it will encourage all Member States to set up national contact points to provide a link between the national-level authorities charged with enforcing the rules governing the internal market and between the Member States and the Commission. The ESC emphatically wishes to be involved in these activities, by virtue of its responsibility for the Single Market Observatory (SMO).

4.5. Mention is also made under Heading III (page 10) of the Commission's views on state aid. The ESC supports the thesis that all forms of state aid which may distort competition - not merely aid provided by central governments but increasingly also aid made available by regional authorities - need to be examined more intensively and more critically. The latter form of aid, too, needs to comply with the relevant EU rules.

The ESC is thus highly interested in the proposal contained in President Santer's Confidence Pact that a particularly close scrutiny be undertaken of the impact on employment of the current policy on state aid ().

4.6. The Commission considers that there is still too little transnational investment by SMEs and feels that they are not sufficiently engaged in seeking new export markets in other EU Member States. The ESC endorses the view that this shortcoming can mainly be ascribed to the lack of a suitable financial instrument. Every support should therefore be given to the proposed application within the EU of the experience gained in promoting such investment in non-EU states, under instruments such as the JOP. The ESC would, however, draw attention to the fact that it is absolutely vital to involve the banking sector, and also venture capital funds in the preparation of such a new financial instrument; this is essential in order to ensure that a) when it is brought onto the market, it will mesh in well with existing instruments and b) that there is no distortion of competition (also between banks).

4.7. Under Heading IV (p. 15), the Commission rightly highlights innovation, research and development and the question of access to the information society. The ESC notes with satisfaction that in the latter area in particular, measures are to be taken to identify the needs of SMEs and to tackle the obstacles hampering their use of information technologies. The ESC supports the increased use of resources from the Structural Funds to give SMEs better access to the information society. Training and further training programmes for workers should also clearly devote considerable attention to this requirement.

Brussels, 31 October 1996.

The President of the Economic and Social Committee

Tom JENKINS

() ESC Opinion on the Proposal for a Council Decision on a third multi-annual programme for SMEs (1997-2000), OJ No C 295, 7. 10. 1996, p. 2, Rapporteur: Mr Lustenhouwer, Co-Rapporteur: Mr Malosse.

() Conclusions of the Presidency - Florence Summit, 21 and 22 June 1996, SN 300/96-EN, p. 4.

() OJ No C 295/02, 7. 10. 1996.

() Action for employment in Europe, a confidence pact. Communication of the President, point 2.15.