EN Official Journal of the European Union C 48/77

Opinion of the European Economic and Social Committee on ‘What services of general interest do we need to combat the crisis?’ (own-initiative opinion)

2011/C 48/14

Rapporteur: Mr HENCKS

On 18 March 2010 the European Economic and Social Committee, acting under Rule 29(2) of its Rules of Procedure, decided to draw up an own-initiative opinion on

‘What services of general interest do we need to combat the crisis?’

The Section for Transport, Energy, Infrastructure and the Information Society, which was responsible for preparing the Committee's work on the subject, adopted its opinion on 6 September 2010.

At its 465th plenary session, held on 15 and 16 September 2010 (meeting of 15 September), the European Economic and Social Committee adopted the following opinion by 119 votes to 11 with 4 abstentions.

1. Introduction

1.1 The recent financial and economic crisis which, even if it has touched all the Member States to varying degrees, will have long-term effects on society – increased unemployment, insecurity, exclusion and poverty – issues which currently already affect one in six Europeans.

1.2 Almost 80 million Europeans, or 16 % of the EU's population, live below the risk-of-poverty line and face significant difficulties with finding employment, obtaining accommodation or benefits and securing access to essential services, especially healthcare and social services. Disadvantaged groups (people with disabilities, immigrants) are and will be hard hit, particularly as developments in the area of social integration and work over the last two decades come under threat.

1.3 The increase in violence, problems in deprived suburbs, the growth in criminality and civil unrest as well as the loss of a certain sense of solidarity are all additional indicators that the financial and economic crisis has become a social crisis.

1.4 The sluggish economic recovery has not been enough to curb this social crisis. Even more disturbingly, in the light of our experiences from previous periods of recession (1993-1996 and 2002-2004), the social consequences of the crisis will probably still be palpable long after the economy has picked up again.

1.5 The increase in poverty and social exclusion will lead to an ever greater demand for social services, especially in the area of health, housing, education, energy, transport and communication methods.

2. The role of services of general interest in times of crisis

2.1 The crisis has shown, however, that modern, effective services of general interest can be a stabilising economic factor with more than 500 000 businesses (public, private and mixed) which offer services of general interest, representing 64 million jobs (over 30 % of EU jobs) and over 26 % of the EU's GDP (Study on ‘Mapping of the public services’ published in May 2010 by the European Centre of Employers and Enterprises providing Public services).

2.2 SGIs can also help cushion the worst social, territorial and environmental consequences if they are able to ensure that everyone has guaranteed access to essential goods and services and fundamental rights. They are a key element in the promotion of economic, social and territorial cohesion and sustainable development.

2.3 Over the years, as part of the European construction process and in the name of the common good or general interest, the EU Member States have enacted a special set of rules for services of general interest varying greatly in terms of form and organisational structure, to supplement EU competition law and market rules, which may be redefined or revised, in particular within the framework of the Lisbon Treaty.

2.4 In accordance with their role as a pillar of the European social model and the social market economy, SGIs should, through interaction and the integration of economic and social progress: — Guarantee the right of each inhabitant to have access to fundamental goods and services; — Ensure economic, social, territorial and cultural cohesion; — Safeguard social justice and inclusion, establish solidarity between regions, generations and/or social categories, promote the general interest of the community; — Ensure equal treatment for all citizens and inhabitants; — Create conditions for sustainable development.

2.5 The crisis has highlighted the fact that market mechanisms alone are incapable of ensuring that all citizens will enjoy universal access to these rights, which means that public intervention is not only accepted by everybody today but is also recommended at international level.

3. Risk of budget cuts in times of crisis

3.1 Further to the financial and economic crisis, certain Member States are finding it increasingly difficult to balance their budgets, which risks jeopardising their ability to fulfil their general interest missions.

3.2 The budgets which Member States allocate to general interest services are often subject to severe pressure even though Member States vary significantly in terms of their capacity to cater to the growing demand for services of general interest.

3.3 These budgetary constraints risk prompting reductions in social benefits and services, social protection schemes and subsidies, entailing severe consequences for the most vulnerable members of society, to the detriment of the progress made to date to combat poverty and inequality and improve social cohesion.

3.4 It appears essential for the Commission to adopt a position on funding needs, not only through a short-term approach focusing on competition only (state aid) but also by ensuring that SGIs are financially viable and capable of carrying out their missions, as required under the Lisbon Treaty.

3.5 It is therefore vital that the Member States, with EU support, adjust their budgets to maintain or expand their services of general interest in order to respond effectively to the challenges posed by the social crisis.

3.6 The EESC endorses the fact that the European Commission has supported the Member States’ training strategies by relaxing the rules for co-financing from the European Social Fund. The social cohesion fund should be used more to improve the social dimension of the Member States’ economies with a view to reducing social disparities and stabilising their economies.

4. The role of the European Union

4.1 In accordance with the principle of subsidiarity and as stipulated by the Lisbon Treaty, each Member State must remain free to define, organise and finance services which cater to the general interest and fundamental needs, with due regard to social and civic action.

4.2 All services of general interest, irrespective of whether or not their nature and mission are economic, contribute to the achievement of the European Union's objectives, in particular the continued improvement in the wellbeing of its citizens, the guarantee of their rights and the conditions for the exercise of these rights.

4.3 Accordingly, the European Union, which has a responsibility to achieve these objectives, also has a responsibility towards the instruments used to achieve them.

4.4 The European Union must therefore contribute to and ensure the provision of effective and accessible SGIs, which offer good quality, affordable services to all, with due regard to the principles of subsidiarity and proportionality, and by sharing such competences with the Member States.

4.5 The fact that, in principle, the states have the power to define SGIs does not in any way detract from the EU's power to define SGEIs at its level, where this is necessary to achieve the objectives of the Union.

4.6 Accordingly, the EESC has urged the EU institutions in numerous opinions to recognise the existence and need for EU services of general interest – without prejudice to the status of operators – in those areas where the EU's objectives can be met more effectively through EU level action rather than individual action by the Member States. Against this background, the EESC has proposed that studies be carried out to assess the feasibility of a European energy SGI.

5. Public service obligations and universal service

5.1 Although access to services of general economic interest should be provided in part by market forces and free competition, Article 14 of the Treaty on the Functioning of the European Union stipulates that the European Union and its Member States shall take care to ensure that such services operate in a manner which enables them to fulfil their missions, each within their respective powers.

5.2 Accordingly, in order to avoid a situation where the simple application of market forces leads operators to focus exclusively on profitable services to the exclusion of low revenue services, densely populated areas to the detriment of isolated or deprived regions or to focus on more affluent consumers to the detriment of equality of treatment, two new concepts arose at EU level during the liberalisation of the network industries (telecommunications, energy, transport, postal services): public service obligations and universal service.

5.3 These two concepts complement one another insomuch as they seek to give users a series of guarantees: a set of more or less widespread high quality services must be provided across the whole EU at an affordable price in sectors which have been defined as a universal service (telecommunications, post, electricity); specific aspects which the EU or the Member States can safeguard and which may concern not only services to users (including in terms of consumer protection) but also security issues, including supply, the independence of the EU, long-term investment planning, environmental protection etc for public service obligations. In both cases, it is possible to establish a derogation from the rules on competition should the application of such rules be detrimental to the above services

5.4 The concept of universal access at an affordable cost should represent a set of common rules governing all services of general interest in the European Union establishing a minimum set of obligations which should be observed by the Member States and local authorities, which should not restrict their missions of general interest but rather develop them instead, while at the same time ensuring they are a spending priority.

5.5 The concept of universal access is not, therefore, incompatible with the provision by every Member State of other types of SGI above minimum standards, in particular public service obligations.

6. Measures to be adopted

6.1 With the Treaty of Lisbon, the European Union has reaffirmed the importance of fundamental rights and guaranteed their exercise, laying out a set of common principles for their more social regulation through the concrete implementation of all the rights (and not only access to services of general economic interest) which the EU Charter of Fundamental Rights confers on every EU citizen.

6.2 The universal right of access to SGIs should therefore no longer be restricted to services provided by network industries alone but should encompass everything required for a decent standard of living, social well-being and the guarantee of fundamental rights.

6.3 Accordingly, we should examine whether, given the current crisis and the need to adopt a sustainable approach, the current regulations (in the area of telecommunications, postal services, electricity) are sufficient to prevent a reduction in the quality of services provided and the emergence of phenomena such as exclusion, social fragmentation and poverty. Equally, it would be useful to establish whether new areas should be subject to ‘a high level of quality, safety and affordability, equal treatment and the promotion of universal access and of user rights’ defined as Community principles by Protocol No 26 annexed to the Lisbon Treaty.

6.4 There is no doubt that the people of Europe would like to enjoy more security in their professional careers and more security against the risk of unemployment and poverty, more equality in access to education and lifelong learning and social services and to ensure the better protection of the environmental equilibrium for future and current generations.

6.5 Accordingly, the service right could include access to: — a bank account and payment facilities; — affordable loans, subject to state micro-credits or guarantees; — decent housing; — home-care facilities; — mobility; — social services; — specific measures for people with disabilities etc.; — access to energy; — secure access to digital services.

6.6 The fact that the economic crisis is continuing, together with the need to work out the best way to achieve economic recovery, should, in parallel with steps to implement the Lisbon Treaty (Article 14 of the TFEU, Charter of Fundamental Rights, Protocol 26), prompt the EU institutions to re-assess the place and role of SGIs in this context.

6.7 The EESC suggests engaging in consultations with stakeholders and civil society on the potential usefulness of the new ‘public service obligations’ or new services of general interest for responding to the crisis and to coordinate and ensure synergy between the economic, social and territorial dimensions of cohesion policy, which have been insufficiently coordinated in the past, and to recommend measures to ensure balanced development.

6.8 With this in mind, the EESC calls for a report on the ‘promotion of universal access to EU rights and SGIs’ and to define the new objectives which SGIs could be given as part of the fight against poverty and social exclusion and, more generally, as part of the EU 2020 strategy and the promotion of sustainable development and a green economy.