No C 172/2 Official  Journal  of the European  Communities 20. 7. 77 
II 
(Preparatory  Acts) 
ECONOMIC  AND  SOCIAL  COMMITTEE 
Opinion  on the development  of the social  situation  in the Community 
The text  referred  to the Committee  has  not  yet been  published  in the Official  Journal 
of the European  Communities. 
A. LEGAL  BASIS  FOR  THE  OPINION  v 
On 6 June  1977,  the Commission  referred  the abovementioned  subject  to the Economic 
and Social  Committee  in accordance  with  Article  198  of the  Treaty  establishing  the 
European  Economic  Community. 
B. OPINION  OF THE  ECONOMIC  AND  SOCIAL  COMMITTEE 
The Economic  and  Social  Committee  prepared  its opinion  on the above  matter  at its 
150th  plenary  session,  held  in Brussels  on 22 and  23 June  1977. 
The full  text  of the opinion  is as follows: 
THE  ECONOMIC  AND  SOCIAL  COMMITTEE, 
Having  regard  to  the  Treaty  establishing  the 
European  Economic  Community,  and  in particular 
Article  198  thereof, 
Having  regard  to the request  for an opinion  made  by 
the Commission  of the  European  Communities  on 
6 June  1977, 
Having  regard  to the decision  taken  by its Bureau  on 
14 December  1976,  in  anticipation  of  the 
consultation,  instructing  the  Section  for  Social 
Questions  to draw  up an opinion  and  a report  on the 
matter, 
Having  regard  to the opinion  delivered  by the Section 
for Social  Questions  on 9 June  1977, 
Having  regard  to the  report  submitted  by  the 
Rapporteur,  Mr Rollinger, Having  regard  to the discussions  at its 150th  plenary 
session  on 22 and  23 June  1977  (meeting  of 23 June 
1977), 
Whereas  the  main  feature  of the  social  situation  in 
1976  was  the  worsening  of unemployment  and 
underemployment; 
Whereas  in 1976  the Community,  if anything,  moved 
away  from  the  employment  target  set  for  1980 
instead  of making  progress  towards  it; 
Whereas  it is therefore  necessary  to adopt  a policy 
and instruments  designed  to  bring  about  full 
employment; 
Whereas  proposals  as to social  policy  measures 
should  therefore  give  a certain  priority  to the 
problems  connected  with  the  fight  against 
unemployment,  due  regard  being  paid  to  the 
Luxembourg  Tripartite  Conference  of 24 June  1976, 
which  linked  the re-establishment  of full  and  better 
employment  to the recovery  of stability  and  growth 
in the Community, 
20. 7.77 Official  Journal  of the  European  Communities No C 172/3 
HAS  ADOPTED  THE  FOLLOWING  OPINION 
by 34 votes  to 4 with  13 abstentions: 
1. A better  common  social  policy  requires  a more 
effective  Community  framework 
1.1. An  examination  of the  development  of the 
social  situation  in 1976  heightens  the disappointment 
produced  by the Commission's  survey  of Community 
policy  over  the  period.  On  the  report  itself,  the 
Committee,  while  welcoming  the  improvements  the 
Commission  has made  over  the years,  would  like  this 
document  to bring  out  more  clearly  the broad  lines 
of the Community's  action  in the social  policy  sphere. 
1.2. The  Committee  has  always  attached  great 
weight  to full  and  rapid  implementation  of the 
measures  announced  in the Social  Action  Programme 
and the  Action  Programme  in favour  of migrant 
workers  and  their  families.  It thinks  the Community's 
performance  on  this  front  in 1976  has  been 
unsatisfactory. 
1.3. It  is sad that  the Commission's  efforts  do not 
always  obtain  the  necessary  backing  and  support 
from  the  Council.  For  example,  the  two  Councils 
of Social  Affairs  in 1976  managed  to  adopt 
only one  legal  instrument  (the  Directive 
approximating  Member  States'  laws  on  the 
preservation  of employees'  rights  after  mergers  and 
takeovers).  . There  is a large  backlog  of draft 
legislation  proposed  by  the  Commission  and 
endorsed  by the  Committee,  particularly  measures 
implementing  parts  of  the  above  two  action 
programmes. 
1.4. Expenditure  in the social  field  will  account  for 
only 6 64 % of the Community  budget  in 1977.  In its 
recent  opinion  on the reform  of the Social  Fund,  the 
Committee  made  the point  that  the Fund  needed  to 
be given  the  resources  that  were  essential  for  its 
proper  operation. 
1.5. While  it is impossible  to deny  the  serious 
problems  posed  by the  persistence  of the  recession 
and the  major  structural  changes  that  it has  made 
necessary,  the lack  of cohesion  between  the national 
policies  for  tackling  the  crisis  and  the  failure  to 
establish  Community  decision-making  machinery  on a parliamentary  basis,  which  would  be a guarantee  of 
efficacy,  are particularly  deplorable. 
1.6. This  merely  confirms  the Committee's  support 
for the  view  that  the  major  Community  objective 
should  be an all-out  drive  against  unemployment  in 
parallel  with  a policy  of gradually  bringing  down 
inflation,  creating  adequate  growth  in  both 
qualitative  and  quantitative  terms,  and  pursuing  a 
positive  employment  policy. 
1.7. In  addition  to  this  indispensable  work 
towards  restoring  full  employment  and  stability  in 
order  to maintain  and  indeed  improve  purchasing 
power,  a range  of other  social  policy  measures  need 
to be taken,  though  these  must  not  be allowed  to 
jeopardize  the other  priorities  of various  kinds  which 
we are  committed  to at Member  State  and  world 
level. 
1.8. The  touchstone  of economic  policy  is surely 
the extent  to which  it improves  social  well-being. 
1.9. Although  the  Member  States'  relatively  high 
economic  dependence  on the  rest  of the  world  and 
their  social  obligations  towards  die  developing 
countries  must  be taken  account  of in social  policy, 
the Community  should  not  feel  it is condemned  to 
inertia  on  the  social  front  because  the  social 
provisions  of the EEC  Treaty  mainly  leave  this  area 
to the authority  of the Member  States.  The  widening 
gaps  between  the economic  and  social  situations  and 
the unemployment  rates  of different  Member  States 
in the  aftermath  of the  recession  are  a striking 
illustration  of the fact  that,  individually,  the different 
countries  are  grappling  with  increasing  difficulties 
that are preventing  them  from  giving  their  citizens  — 
both  as employees  or self-employed  workers  and  as 
consumers  — the standard  and  quality  of life  which 
the opportunities  opened  up by technical  progress 
would  allow,  taking  account  of the  constraints 
imposed  by the  need  for  a healthy  and  balanced 
environment.  The  Committee  therefore  repeats,  this 
time  for  social  reasons,  its  call  for  greater 
Community  cohesion,  which  means  alignment 
between  the  Member  States  in the  framing  and 
implementation  of economic,  financial  and  monetary 
policies,  and  in their  relations  with  non-member 
countries,  with  a constant  eye  to the maintenance  of 
individual  liberties  and  the  free  movement  of goods, 
services  and  capital. 
1.10.  In  this  setting,  the  common  social  policy 
should  have  a key  role.  It must  be a properly 
No C 172/4 Official  Journal  of the  European  Communities 20.7.77 
balanced  policy,  combining  the goal  of full  and better 
employment  with  the  other  social  objectives 
connected  with  improvement  of working  and  living 
conditions,  elimination  of poverty  in all its forms  and 
aid to the disadvantaged  peoples  of the Third  World, 
in a way  which  does  not jeopardize  the social  rights 
of future  generations. 
1.11.  The  Community's  institutional  machinery 
needs  to  be  improved  by  strengthening  its 
parliamentary  democracy  and  by better  Community 
level  coordination  of  the  Member  States' 
medium-term  economic  policies.  But  even  before 
such  an improvement  is made,  the present  institutions 
should  already  set  about  the  task  of introducing 
greater  consistency  between  the  action  taken  under 
the various  common  policies  now  in operation  or at 
the development  stage  (in  particular  the  regional, 
agricultural  and  industrial  policies)  and  the  contents 
and main  aims  of social  policy.  The  same  applies  to 
the various  Community  consultative  bodies  whose 
role is more  than  a purely  technical  one,  such  as the 
Economic  and  Social  Committee,  which  was  set up 
by the EEC  Treaty  and  the Tripartite  Conference,  the 
Standing  Committee  on Employment  and  the  other 
consultative  or research  bodies  established  by the 
Council.  The  present  dissipation  of effort  and 
resources  due  to duplication  and  even  conflicting 
activities  must  cease.  Instead  there  must  be  a 
concentration  of  energies  and  an  increase  in 
efficiency,  to ensure  that  the  social  aspect  receives 
more  attention  in the Community's  and  the Member 
States'  policies.  The  Committee  is prepared  to 
cooperate  fully  in any  such  action.  This  would 
necessarily  involve  seeking  a broad  consensus 
between  the public  authorities  and  the  two  sides  of 
industry  or any  other  interested  groups,  depending 
on the matter  being  dealt  with. socio-economic  policy,  for social  policy  to be inte-
grated  with  medium-term  economic  planning. 
2. The  Committee's  role  in the search  for a social 
consensus 
2.1. The  overriding  importance  of the objective  of 
full and  better  employment  in the general  context  of 
social  and  economic  policies  makes  it necessary  for 
the Community  authorities  to work  closely  together 
with  the  groups  with  a direct  interest  in the 
formulation  and  implementation  of employment 
policy.  The  Commission  has  long  fostered  such  links 
by holding  consultations  with  all  the 
Community-level  trade  union  and  employer's 
organizations.  Establishment  of  the  Standing 
Committee  on Employment  widened  the dialogue  by 
bringing  in Member  States'  employment  ministers. 
The final  step  has  been  the  tripartite  conferences 
which  are  now  called  at more  or less  regular 
intervals.  These  add  a further  dimension  to the debate 
by including  among  their  participants  the  national 
ministers  of economic  affairs  and finance  as well.  It is 
noteworthy  that  in  the  new  Commission  the 
Vice-President  with  responsibility  for  employment 
and social  affairs  has been  given  the job of organizing 
future  tripartite  conferences. 
2.2. Experience  has  shown  that  however  valuable 
these  forums  may  be, neither  the Standing  Committee 
on Employment  nor tripartite  conferences  are capable 
of resolving  by themselves  the  problems  posed  by 
employment  and  working  conditions.  Indeed,  a 
badly-organized  tripartite  conference  might  do more 
harm  than  good. 
1.12.  For  the development  of social  policy  there  is 
no need  to transfer  all powers  in the social  field  from 
the national  to the Community  authorities.  Generally 
speaking,  the Community  policy  must  concentrate  on 
problems  which  are  quite  impossible  to solve,  or 
solve  satisfactorily,  at national  level.  In recent  years, 
there  has been  a sharp  increase  in the number  of such 
problems  in the  social  sector,  too.  The  existing 
EEC  social  policy  instruments,  however  useful,  are 
clearly  not capable  of providing  satisfactory  solutions 
to the  major  social  problems  that  now  face  the 
Community  and  will  face  it in the years  ahead.  First 
and foremost,  we have  the fight  against  unemploy-
ment,  now  at an unprecedentedly  high  level  and  with 
a hard  structural  core.  There  has  been  growing 
recognition  in recent  years  of the need  for a coherent 2.3. For  the  discussions  that  are  needed  between 
the different  interest  groups,  it is necessary  that  the 
existing  joint  committees  should  function  better  and 
that new  joint  committees  should  be set up for other 
1 sectors,  without  jeopardizing  the  autonomy  of the 
parties  in question.  These  committees  must  play  a 
role in consultation  on  medium-term  trends.  A 
greater  flow  of information  from  businesses  is crucial 
to the  more  effective  functioning  of the  joint 
committees.  The  role  and  tasks  of the  committees 
would  therefore  have  to be defined  in greater  detail. 
From  the organizational  angle,  the committees  could 
be accommodated  at the  Economic  and  Social 
Committee  in view  of the fact  that  the Committee  has 
its own  secretariat  and  its own  budget. 
20. 7. 77 Official  Journal  of the European  Communities No C 172/5 
2.4. Coming  to  the  Economic  and  Social 
Committee,  this was  set up by the Rome  Treaties  as a 
forum  for  representatives  of the  various  interest 
groups  to make  their  opinions  known  to the 
Commission  and  the Council.  Thanks  to the division 
of members  into  three  groups,  an employers'  group,  a 
workers'  group  and  a group  consisting  of 
representatives  of other  interests  —  which  is 
permitted  under  the Committee's  Rules  of Procedure 
— the representatives  of the  broad  interest  groups 
can concert  their  views  beforehand  in a fair degree  of 
detail. 
2.5. Without  wishing  to question  the usefulness  of 
the new  channels  of consultation  or impede  their 
further  expansion,  the  Committee  thinks  that  its 
position  as  the  chief  advisory  body  in  the 
Community's  institutional  machinery  should  be 
strengthened.  In 1974,  the Committee  delivered  an 
opinion  entitled  'The  place  and role  of the Economic 
and Social  Committee  in the institutional  machinery 
of the  Communities  in the  context  of a possible 
evolution  thereof',  and will  be taking  another  look  at 
this matter  in the near  future. 
2.6. Since  the Committee  is established  as a regular, 
institutional  debating-partner  of the  Council  and 
the Commission,  it is necessary  to ask  again,  with 
greater  urgency,  the question  which  has been  raised 
on previous  occasions  by the  Committee,  namely, 
should  not its work  be coordinated  more  closely  with 
that of other  consultative  bodies?  Such  coordination 
would,  for instance,  enable  the Standing  Committee 
on Employment  and  the  tripartite  conferences  to 
benefit  from  the detailed  studies  and  the considered 
points  of view  arrived  at by the Committee,  often  in 
close  cooperation  with  experts  from  unions  and other 
organizations  representing  the  various  social  and 
economic  interest  groups. 
2.7, The  subject  of employment  is dealt  with 
directly  or indirectly  in many  Committee  opinions 
drafted  by various  of its sections  — which  goes  to 
show  the complexity  of this  problem,  one  which  is 
soluble  only  with  a medium-term  overall  strategy. 
The Committee's  annual  opinion  on  the 
Development  of  the  Social  Situation  in  the 
Communities  provides  an opportunity  to formulate 
recommendations  on the policy  to be followed  in the 
coming  year. 
2.8. It  is therefore  surprising  to find  that  the 
Commission,  in its proposals  on the social  consensus, fails to mention  the  possibility  of involving  the 
Committee,  particularly  when  one  remembers  that 
members  of its staff  work  almost  continously  with 
Committee  sections  on social  policy  issues.  It is also 
discouraging  to find  that  the  Commission's  report 
makes  no mention  at all of the many  contributions 
made  by the Committee  in the social  policy  field. 
3. Major  social  policy  aims  for 1977 
3.1. A more  determined  drive  against  unemployment 
3.1.0.1.  The  persistence,  and  indeed  increase,  of 
unemployment  throughout  1976  has taught  us how 
inextricably  linked  are  our  economic  and  social 
problems,  and  has  given  us a clear  insight  into  the 
underlying  causes  of the recession  and  the monetary 
instability  and  serious  unemployment  associated  with 
it. The  ineffectiveness  of past  measures  against 
unemployment  suggests  that  action  on a broad  front 
is called  for. 
3.1.0.2.  Achievement  of futy  employment  in the 
medium  term  without  any  unacceptable  drop  in 
income  levels  and  living  standards  is not  possible 
unless  there  is a policy  of selective  growth.  The 
Community  should  rapidly  develop  such  a policy, 
within  overall  medium-term  planning.  The  economic 
growth  must  be based  on the  expansion  of home 
markets,  a balanced  development  of trade  with  the 
rest of the  world,  and  an adequately  profitable 
corporate  sector  capable  of making  the investments 
which  will  produce  jobs.  The  Committee  has made 
recommendations  as to how  these  objectives  should 
be achieved  in a number  of specific  opinions  (see,  in 
particular,  Sections  6.1 and  6.2  of opinion  on the 
Community's  Fourth  Medium-Term  Economic  Policy 
Programme). 
3.1.0.3.  The  worrying  levels  reached  by 
unemployment  and  the  very  real  danger  that  high 
umemployment  is here  to stay  unless  determined 
measures  are taken  to tackle  it mean  that  not only 
must  a more  dynamic  policy  of growth  be pursued, 
but above  all a more  positive  policy  on employment. 
No C 172/6 Official  Journal  of the European  Communities 20. 7. 77 
3.1.0.4.  The  Committee  thinks  that  we will  have  to 
concentrate  in this  more  positive  employment  policy 
on absorbing  the disproportionately  high  numbers  of 
young  unemployed,  some  completely  unskilled, 
others  having  qualifications  which  are not needed  in 
the economic  and  social  environment  of today.  This 
also applies  to young  women,  whose  difficulties  in 
finding  work  are  increased  if they  have  not 
previously  been  in a career.  Nor  is there  any incentive 
to undergo  further  training  if there  is no prospect  of 
a job afterwards. 
3.1.1.  Main  elements  of  a  positive 
employment  policy 
3.1.1.1.  It  must  be recognized  when  we join  in the 
call for  a positive  employment  policy  that  at the 
present  stage  of its integration  the Community  can 
clearly  do no more  than  map  out  the  various 
components  of such  a policy  for the Member  States 
to follow  and  provide  such  assistance  as it can  to 
ensure  that  the  policy  is carried  out  quickly, 
effectively  and  in a coordinated  manner.  National 
and Community-level  consultation  of the  economic 
interest  groups  is of crucial  importance  for this work. 
The policy  must  have  the following  features: 
— it must  be adaptable  and  allow  for  the  very 
disparate  circumstances  obtaining  in  the 
individual  Member  States, 
— it must,  however,  be undertaken  from  a sense  of 
national  and Community  solidarity,  which  implies 
that in terms  of social  affairs  it must,  for the 
moment,  take  priority  over  other  aims, 
— it must  steer  clear  of sex discrimination, housing  and  home  improvements;  improvement 
of the  reception,  guidance,  education  and 
assistance  facilities  for migrant  workers  and  their 
families,  especially  the children,  along  with  better 
coordination  of Member  States'  policies  on 
migration;  furthermore,  improvement  of the 
living  conditions  and standards  of care  of the old, 
the lonely  and the sick, 
— part  of the money  to carry  out the policy  must 
come  from  the Social  and Regional  Funds  and the 
Guidance  Section  of the Farm  Fund, 
— besides  coordinating  these  Community  schemes, 
the policy  must  work  towards  a coordination  of 
the national  aid schemes.  This  is required  in order 
to prevent  distortions  of competition,  development 
of overcapacity  in particular  industries  and 
duplication  and competition  between  aid schemes, 
which  weaken  their  effect  in terms  of jobs  created 
and reduce  the  amount  of money  available  to 
help the poorest  areas  in the Community, 
— it must  include  a thorough  study  of the case  for 
wider  use of part-time  work  as a means  of sharing 
out the  work  available  in  the  current 
circumstances, 
— special  attention  must  be given  to certain  aspects 
like employment  in rural  areas  (see  the  Com-
mittee's  study  on employment  in agriculture  and 
its opinion  on  regional  development  and 
employment)  and  the employment  of women;  a 
full study  should  be made  of the reasons  for the 
scale  and  peculiar  development  shown  by female 
unemployment. 
— it must  be designed  in such  a way  that  the special 
measures  to meet  the  exceptional  situation  are 
automatically  phased  out  as the economic  and 
social  environment  improves, 
— it must  avoid  fuelling  inflation  but  not  restrict 
overall  domestic  demand, To conduct  such  a policy,  we need  to improve  our 
knowledge  of the  labour  market  through  better 
coordination  and  organization  of  national 
employment  services,  and an increase  in research  and 
information  about  the labour  market  and the changes 
which  take  place  on it. 
— it must  include  financial  incentives  for employers 
to take  on workers  similar  to those  provided  for 
investment, 
— it must  give  preference  to measures  which  also 
further  other  social  aims,  such  as low-cost 3.1.1.2.  A  further  necessary  aspect  of a positive 
employment  policy,  and  one  which  must  conform 
with a structural  policy,  is encouragement  of 
self-employed  activities  and  small  businesses, 
including  those  in the services  sector  and  farming, 
which  are capable  of maintaining  and  creating  jobs 
20. 7. 77 Official  Journal  of the  European  Communities No C 172/7 
within  the  businesses  themselves  and  in associated 
industries.  These  activities  also  tend  to make  for  a 
better  quality  of growth.  This  does  not mean  that  we 
should  keep  alive  artificially  activities  or businesses 
that are  not  viable.  In such  cases  social  back-up 
measures  must  be  taken  to  help  the  people 
concerned. 3.1.2.4.  Since  labour  often  has to be recruited  from 
outside  the  area  to fiM  vacancies,  measures  assisting 
workers  and  their  families  to move  to other  areas  are 
still essential. 
3.1.3.  Shorter  working  hours 
3.1.2.  Better  sharing-out  of  the  work 
available 
3.1,2.1.  The  question  here  is whether  the  total 
quantity  of available  work  should  not  be shared  out 
more  fairly.  It is difficult  to give  a general  answer  to 
this question,  because  it is a complex  matter  which 
varies  depending  on  whether  it is considered  in 
macro-economic  or  micro-economic  terms,  and 
whether  we are  talking  of a fundamental  long-term 
change  or  the  solution  to  the  immediate 
unemployment  problems.  This  solution  is all right  in 
theory  when  we simply  take  the  overall  numbers  of 
wholly  and  partially  unemployed,  and  the  total 
number  of days  or hours  worked.  But  more  account 
needs  to be taken  of the  fact  that  the  work  that  is 
available  cannot  be divided  up at will,  and  that  many 
vacancies  cannot  be filled  by the  labour  available 
because  they  require  specific  skills  which  the 
unemployed  often  do not  have. 
3.1.2.2.  It  follows  that  a better  distribution  of 
work  often  requires  retraining  measures. 
Unfortunately,  for  various  reasons  — because  the 
retraining  schemes  are badly  designed  or lead  to jobs 
that are  less  well  paid  or of a more  arduous  nature, 
or for  personal  reasons  — the  unemployed  are  not 
always  willing  to undergo  such  retraining. One of the aspects  which  must  be studied  in order  to 
plan  and  implement  a positive  employment  policy  is 
how best  to redistribute  the  total  amount  of work 
available  and,  in particular,  what  the advantages  and 
disadvantages  are  of a reduction  in weekly  working 
hours.  The  Committee  thinks  that  these  studies 
should  be  done  with  urgency  so  that  concrete 
proposals  can  be produced  at an early  date. 
3.1.3.1.  Reduction  in the working  week 
3.1.3.1.1.  The  question  of whether  there  should  be 
a general  reduction  in hours  must  be considered  at 
both  national  and  Community  and  international  level 
in the  light  of its potential  impact  on costs,  prices, 
labour  productivity  and  national  product.  It must  be 
remembered  that  a reduction  in GNP  could  reduce 
the amount  of goods  and  services  available  for 
distribution  between  the various  social  groups  within 
the Member  States  and  to the disadvantaged  peoples 
of the  Third  World.  Besides  this  there  is also  the 
factor  that  work  is not always  transferable;  vacancies 
created  by a reduction  in working  hours  are  not 
necessarily  filled,  for  lack  of  suitably  trained 
replacements  to take  over  the  work.  Consequently, 
reductions  in working  hours  must  be considered  very 
carefully,  and  having  regard  to  the  particular 
circumstances  obtaining  in the individual  sectors  and 
Member  States. 
3.1.2.3.  Despite  the  difficulties,  steps  need  to be 
taken  to improve  vocational  guidance,  training  and 
retraining  facilities  and  to gear  them  more  closely  to 
job-market  requirements  and  trends.  Although  this 
will have  to be done  mainly  by the  Member  States, 
the Community  could  make  an effective  contribution 
by (i) implementing  the  Commission's  plans  for 
improving  statistical,  analysis  and  forecasting 
instruments,  (ii) ensuring  closer  coordination  of the 
work  done  by national  employment  services,  and  (iii) 
giving  the Social  Fund  more  scope  for action. 3.1.3.1.2.  Shorter  working  hours  as a means  of 
spreading  the  work  available  could  be a satisfactory 
stopgap  remedy  in specific  sectors.  "Where  changes  of 
this kind  are  contemplated,  a careful  and  critical 
examination  should  first  be  made  of ways  of 
financing  them  and  their  effects  on  costs  and 
competitiveness.  One  measure  which  could  be taken 
would  be to reduce  overtime  to a minimum  and 
clamp  down  as far  as possible  on side-jobs  with 
another  employer  or in a self-employed  capacity. 
No C 172/8 Official  Journal  of the European  Communities 20. 7. 77 
3.1.3.2.  Raising  of the school-leaving  age 3.2. Progress  towards  the  narrowing  of inequalities 
3.1.3.2.1.  The  high  rate  of unemployment  among 
young  people  is a special  problem,  which  needs  to be 
given  absolute  priority.  A general  raising  of the 
school-leaving  age  could  in  some  cases  have 
undesirable  effects  in the  shape  of increased  social 
costs  and  risks  of vocational  disorientation.  The 
Committee  would  therefore  point  to the  advantages 
of practical  programmes  to increase  the numbers  of 
training  and  indeed  work  experience  places  in 
suitable  firms.  The  Committee  is aware  that  the 
situation  in this  respect  varies  widely  from  one 
country  to another. 
3.1.3.3.  Lowering  of the retirement  age 3.2.1.  The  objective  of  maintaining, 
and if  possible  improving, 
incomes,  taking  due  account  of 
the inevitable  changes  in  the 
distribution  of  income 
3.2.1.1.  The  concerted  drive  against  unemploy-
ment  and  inflation  can only  succeed  if all sections  of 
society  display  solidarity.  The  solidarity  must  operate 
not only  between  the employed  and  the unemployed 
or part-unemployed,  but  also  between  the  well-off 
and the  less  well-off,  particularly  those  right  at the 
bottom  of the scale. 
3.1.3.3.1.  In  certain  Member  States  and  for 
particular  jobs,  introduction  of voluntary  early 
retirement  could  prove  to be a useful  step.  . This 
should  be done  in such  a way  that  eventually  young 
or adult  workers  are  taken  on to fill the vacancies. 
Also,  the pension  funds  must  not  be made  to bear 
such  a proportion  of the  extra  costs  resulting  from 
earlier  retirement  that  their  financial  stability  is 
jeopardized. 
3.1.4.  The  threat  posed  by  undeclared 
work 3.2.1.2.  In  most  cases,  the current  recession  makes 
it difficult  if not  impossible  to increase  real  earned 
incomes.  But  every  effort  must  be made  to ensure 
that the labour  force  does  not  suffer  a cut in living 
standards.  In recent  years  there  have  been  radical 
changes  in the  value  placed  on different  kinds  of 
economic  goods  in  both  the  material  and 
non-material  spheres,  and  these  have  affected  the 
relative  status  of the  workers  producing  goods  and 
services.  There  is inevitably  an increase  in demand 
for some  manual  jobs,  particularly  the  heavy  or 
highly-skilled  kind  compared  with  other  jobs.  At the 
same  time  there  are  often  too  many  people  seeking 
white-collar  jobs  and  their  skills  are often  not  what 
the market  needs. 
3.1.4.1.  It  would  be a major  omission  not  to call 
attention,  however  briefly,  to the serious  problem  of 
undeclared  work.  Undeclared  work  has  become  so 
widespread  in some  countries  and  in particular 
sectors  that  it has  reached  a point  where  it hampers 
attempts  to restore  full  employment  and  makes 
statistics  on  employment,  incomes  and  income 
distribution  unreliable.  Furthermore,  the  practice  is 
placing  an increasing  strain  on public  expenditure 
budgets  and  social  security  funds,  thus  making  it 
difficult  if not impossible  to achieve  many  social  aims 
that have  assumed  increased  importance  (such  as 
temporary  lengthening  of the  period  for  which 
unemployment  benefits  are payable  and  extension  of 
unemployment  insurance  to  new  groups  of 
beneficiaries).  The  Commission  ought  to have  a study 
carried  out covering  the reasons  behind  the spread  of 
undeclared  work,  its manifold  effects  and,  if possible, 
the numerical  size  of the problem. 3.2.1.3.  A  re-ordering  of the incomes  ladder  is the 
inevitable  result  of such  developments  and  it is 
pointless  resisting  it. What  must  be done  is to soften 
the blow  on the victims  by means  of assistance  such 
as retraining,  mobility  and  removal  allowances,  etc. 
Where,  because  of market  requirements,  the danger 
of inflation  or the  need  to channel  resources  into 
investment  in order  to boost  the economy,  a degree 
of restraint  in the  increase  of the  various  types  of 
incomes  is necessary,  ways  should  be explored  of 
providing  a measure  of compensation  elsewhere  (on 
wealth  or in the form  of tax relief,  etc.). 
3.2.1.4.  The  research  work  into  real  incomes  and 
the comparability  of statistics  on incomes  should  be 
20. 7. 77 Official  Journal  of the  European  Communities No C 172/9 
continued,  as the  Committee  recommended  in its 
opinion  on  the  Fourth  Medium-Term  Economic 
Policy  Programme  (paragraph  6.2.2).  Currently 
available  statistics  on the distribution  of incomes  are 
inadequate.  Greater  knowledge  would  objectivize  the 
issues  raised  by income  distribution. 
3.2.2.  Protection  of  the  underprivi-
leged 
3.2.2.1.  Special  attention  should  be paid  to the 
underprivileged  and  those  who  have  been  hardest  hit 
by the recession  and  inflation.  They  include  members 
of the  working  population  (particularly  migrant 
workers  and  some  types  of disabled)  and  the 
non-working  population  (the  severely  disabled,  some 
old people,  particularly  women,  and  some  young 
people).  This  makes  it alarming  to read  in the 
Commission's  report  of social  services,  instead  of 
being  expanded,  often  having  to be cut as a result  of 
increasingly  severe  budget  constraints.  As  a 
medium-term  aim  social  policy  should  include  the 
extension  of social  security  provision  to the  whole 
population  on an equitable  and  non-discriminatory 
basis. basic  human  right  to a decent  place  to live,  but also 
because  it boosts  employment  in the  building 
industry. 
3.2.4.  Reform  of  social  security 
arrangements 
3.2.4.1.  In  a policy  intended  to narrow  social 
inequalities,  great  importance  attaches  to the  social 
security  schemes,  which  are  also  increasingly 
assuming  an income-redistribution  function.  One  of 
the difficulties  of social  security  schemes  is to have 
sufficient  resources  at their  disposal  to give  all their 
members  proper  protection.  On the  other  hand,  the 
cost to individual  contributors  and  to society  must 
remain  within  reasonable  bounds. 
3.2.4.2.  Social  security  schemes  are  already 
stretched  to the limit  and  it is becoming  increasingly 
doubtful  whether  we  can  hand  over  a financially 
sound  system  to the coming  generation.  The  coming 
generation  may  well  find  itself  having  to pay, 
especially  in their  old-age  and  surviving  dependants' 
pensions,  for the shaky  foundations  we are  now  in 
the process  of erecting. 
3.2.2.2.  In  view  of the  priority  which  should  be 
assigned  to the  narrowing  of social  inequalities,  the 
Commission  should  speed  up the  completion  of its 
programme  of pilot  projects  to combat  poverty,  on 
the basis  of the  interim  report  it published  on 13 
January  1977.  The  Council  should  approve  the 
necessary  finances  so that  the  Commission  can 
complete  the work  in hand  and  evaluate  the practical 
lessons  to be learnt  from  the  programme,  paying 
particular  attention  to the special  nature  of poverty  in 
rural  areas  where  the  situation  is particularly 
complex. 3.2.4.3.  A  thorough  review  should  therefore  be 
carried  out at once  of all social  security  schemes  with 
the aim  of cutting  out costs  that  are inessential  or due 
to abuses  or such  factors  as an unnecessarily  large 
administrative  apparatus,  the  overprotection  which 
increasing  numbers  of people  not  in financial  need 
are now  coming  to have,  outdated  rules,  etc. 
3.2.4.4.  In  this  context,  the  Committee  endorses 
what  the  Commission  says  in paragraph  200  of its 
report  about  the different  rates  of increase  of social 
benefits  and  national  incomes  and  the solutions  that 
should  be found  to this  problem. 
3.2.3.  Low-cost  housing 
3.2.3.1.  Among  more  general  measures  that  are 
needed  to achieve  better  all-round  living  conditions  is 
low-cost  house-building,  i.e.  provision  of adequate 
supplies  of  dwellings  at moderate  cost.  Such 
house-building  is justified  not  only  because  of the 3.2.4.5.  Such  an exercise  can only  bear  fruit  in the 
medium  term.  But  a start  should  be made  now.  Even 
more  important,  we  should  be  careful  not  to 
aggravate  the present  situation  by entering  into  new 
and ill-considered  commitments  prompted  by  the 
recession. 
3.2.4.6.  Although  social  security  provision  is 
essentially  the  province  of the  Member  States,  the 
No C 172/10 Official  Journal  of the  European  Communities 20. 7. 77 
needs  of labour  mobility,  equalization  of the terms  of 
competition  and  closer  (upward)  alignment  of living 
conditions  make  it necessary  for  the  Community 
authorities  to continue  to give  a determined  lead  on 
this front. 
3.2.4.7.  With  regard  to the  increasing  of our 
knowledge  about  the  trend  of  social  security 
expenditure  (see  Table  X, of the Commission  report), 
the Committee  would  repeat  its  call  for  rapid 
completion,  at the latest  by the end  of the year,  of the 
second  'European  Social  Budget',  which  will  contain 
forecasts  of social  security  expenditure  and  its 
financing  up  to  1980  and  throw  light  on  the 
proportion  this  will  account  for in social  expenditure 
as a whole. 
3.2.5.  Progressive  improvement  of 
the environment 
3.2.5.1.  Improvement  of the  environment  is also 
to be included  among  the  ways  we  can  improve 
living  conditions  and  reduce  inequalities.  The 
financial  and  economic  difficulties  crcated  by  the 
recession  must  not  make  us lose  sight  of this  im-
portant  social  policy  aim,  even  if its pursuit  must 
depend  on the  requirement  for  businesses  and  the 
community  at large  to balance  their  books.  Measures 
of environmental  protection  are  going  to play  an 
increasing  role  in the drive  to restructure  the economy 
and reduce  unemployment.  Therefore,  it is fair  to 
ask whether  some  of them  could  not  be carried  out 
as part  of a positive  policy  on employment. 3.3. Improvement  of  living  and  working  conditions 
3.3.1.  The  Commission's  report  rightly  points  to a 
certain  switch  of interest  away  from  the quantitative 
aspects  of working  conditions  to the  qualitative 
aspects.  The  Committee  therefore  endorses  the 
Commission's  intention  to contribute  — through  the 
European  Foundation  for  the Improvement  of Living 
and Working  Conditions  — to finding  ways,  in close 
liaison  with  governments  and,  above  all,  the  two 
sides  of industry,  of further  humanizing  the  working 
environment. 
3.3.2.  In  the  first  place,  the  work  should 
concentrate  on  protecting  workers  against  health 
hazards  arising  from  dangerous  substances  and 
against  industrial  diseases  in  general.  The 
Community  programme  in the process  of preparation 
on health  and  safety  at work  should  be placed  before 
the authorities  as soon  as possible.  Measures  to 
improve  health  and  safety  at work  must  continue  to 
be the  subject  of close  consultation  between  all the 
interested  parties.  Finally,  every  opportunity  should  be 
taken  of humanizing  work,  particularly  the repetitive, 
heavy  or  dirty  kinds,  and  the  possibility  of 
introducing  more  flexible  working  hours  should  not 
be forgotten.  The  methods  chosen  must,  of course, 
allow  for  the  differing  conditions  obtaining  in 
different  industries  and  sectors  and  for  the legitimate 
needs  of consumers  and  society.  The  Committee  also 
emphasizes  the  role  which  should  be played  by the 
European  Foundation  for  the Improvement  of Living 
and Working  Conditions,  and  calls  for  better 
coordination  between  the  Commission  departments 
responsible  for  the  different  subjects  dealt  with  in 
this chapter. 
Done  at Brussels,  23 June  1977. 
The Chairman 
of the  Economic  and  Social  Committee 
Basil  de FERRANT1 
20. 7.77 Official  Journal  of the  European  Communities NoC  172/11 
APPENDIX 
to the Committee's  opinion 
The following  amendments  were  rejected  during  the discussions: 
Para.  3.1.0.3 
Add the following: 
'One  of the essential  conditions  for such  a policy  is better  knowledge  of the prospects  for 
individual  branches  of industry.  Compulsory  notification  of investments,  as in the  coal 
and steel  industry,  should  be extended  to cover  all the major  branches  of EEC  industry. 
Public  authorities  need  to have  such  knowledge  in their  efforts  to influence  the direction 
of and  stimulate  investment  and  when  they  themselves  undertake  investment.  The  criteria 
which  should  be applied  in influencing  the direction  of investment  are: 
(a) the number  of jobs  provided  and  their  quality; 
(b) the impact  of the measure  as regards  reduction  of regional  disparities; 
(c) requirements  of the environment;  and 
(d) progress  towards  a just  international  division  of labour.' 
Voting: 
for: 18, against:  39, abstentions:  1. 
Para.  3.1.3.1 
Replace  the last sentence  of 3.1.3.1.1  by the following: 
'However,  in view  of the  fact  that  the  unemployed  in Europe,  particularly  young  job 
seekers,  run into  millions,  calls  for a shorter  working  week  are much  keener  at this  time. 
This  would  be one  way  of contributing  to a policy  of full  employment  by sharing  out 
the work  available  as fairly  as possible.' 
Reasons: 
Without  underestimating  the  specific  aspects  of the  problem  of the  working  week  in the 
various  Member  States,  it must  be stressed  that  a phased  reduction  is a factor  in a fuller 
employment  policy. 
Voting: 
for: 19, against:  31, abstentions:  3. 
Para.  3.2.1.3 
Amend  as follows: 
'A fair  income  distribution,  and  a lessening  of inequalities  is to be aimed  at. All incomes, 
and not just  wages  and  salaries,  which  are fixed  by collective  agreements  must  be brought 
into this  process.  The  Committee  regards  it as unacceptable  in this  connection  that 
freedom  of collective  bargaining,  which  is provided  for in ILO  Conventions  Nos  87 and 98, 
should  be tampered  with.' 
Voting: 
for: 16, against:  24, abstentions:  7.