Communication from the Commission - Community policies in support of employment
Date: 1998-06-03
Institutions: European Commission
Subjects: EU employment policy, economic growth, economic policy, fight against unemployment

COMMISSION OF THE EUROPEAN COMMUNITIES 

Brussels, 03.06.1998 
COM(1998) 354  final 

COMMUNICATION FROM THE COMMISSION 

Community  policies  in support  of  employment 

Community policies in support of employment 

Communication  from  the Commission 

Introduction 

A framework  for  employment  growth 

in 

on 

held 

policies 

employment 

than  hitherto  of 
support 

extraordinary  European  Council 
The 
meeting 
in 
Luxembourg  in  November  1997  called  for 
the  harnessing  in  a  more  systematic,  more 
all 
deliberate  way 
Community 
of 
employment,  both  framework  policies  and 
the 
support  policies, 
potential  for  dynamism  and  enterprise  to 
be  found  in  Europe's  economy.  This  is  in 
line  with  article  127(2)  of  the  Amsterdam 
Treaty  which  provides  that  the  objective 
of  a  high  level  of  employment  shall  be 
taken  into  consideration  in the  formulation 
of  Community 
implementation 
and 
policies  and  activities. 

to  help  unleash 

the 

scope 

attention 

For  many  years  the  Commission  has  been 
and 
to 
drawing 
potential  of  Community  policies  and 
initiatives  to  promote  employment.  The 
Communication  of  5  June  1996  -  Action 
in  Europe:  A  Confidence 
for  Employment 
Pact 
the  Communication  of  12 
November  1997  -  Community  Policies  in 
-  are  notable  in 
Support  of  Employment 
this  respect. 

-  and 

and 

This  Communication  is  intended  to  show 
how  Community  policies  and  EU-wide 
activity  can  help  Member  States 
to 
develop 
employment 
implement 
policies  which  are consistent  with  both  the 
Employment  Guidelines  and  the  Broad 
Economic  Policy  Guidelines. 
Taken 
together,  these  three  documents,  which 
will  be  on  the  table  at  the  Cardiff  Summit, 
provide  the  parameters  for  the  coordinated 
strategy  for  employment  embedded  in  the 
new  Treaty. 

The  European  Union  is becoming  more  and 
more  an  integrated  economic  entity.  Trade 
and  capital  flows  reveal  that  the  Union  is 
increasingly  becoming  -  like  the  United 
States  -  a  relatively  integrated  economy 
with  a  high 
interdependence 
level  of 
the  economies  of  the  Member 
between 
the 
EMU  will  further 
States. 
for 
opportunities 
European 
in 
Imports  of  goods  from 
particular  SMEs. 
outside  the  EU  currently  account  for  only 
8% of Community  GDP. 

increase 
trade 

for  cross-border 

companies, 

including 

In the run-up to the  final  stage of EMU,  this 
interdependence  provides  an  opportunity, 
and  a  good  reason,  to  strengthen  economic 
and  employment  policies  and 
to  make 
optimal  use  of  the  possibilities  offered  by 
the  launch  of  EMU  on  1  January  1999. 
This  will 
policy 
coordination  and  full  adherence  to  Single 
Market  rules and  standards. 

effective 

require 

Single  Market 

The  Single  Market  Action  Plan,  agreed  at 
the  Amsterdam  European  Council,  commits 
Member  States  to  removing  the  remaining 
barriers  by  1  January  1999.  The  second 
Single  Market  Scoreboard  issued  recently 
shows  that  significant  progress  has  been 
taking 
achieved.  Supply  side  reform 
hold  : in  télécoms,  energy,  air  transport  for 
example.  Nevertheless,  with  only 
six 
months 
the  end  of  year 
deadline,  some  delays  and  hesitations  are 
becoming  apparent  and  this  is  worrying.  In 
particular,  some  Member  States  are  behind 
in  implementing  Community  legislation  as 
the scoreboard  shows. 

to  go  before 

is 

for 

additional 

The  Commission's  report  to  the  European 
Council  Doing  Less  but  Doing  it  Better  : 
the  Facts  demonstrates  that  the  volume  of 
proposals  for  Community  legislation  has 
dropped  and  shows  that  it  is  indeed  the 
Member  States themselves  who  are  largely 
responsible 
legislation. 
Meanwhile,  the  work  on  simplification 
continues.  The  third  phase  of  SLIM  was 
launched  in  March  1998  and  the  fourth 
one  should  be  launched  in  the  coming 
weeks.  However,  there  is  a  serious  risk 
that  new  technical  barriers to trade  arise  as 
Member  States  continue  to  adopt  a  vast 
array  of  technical  regulations  concerning 
products.  This  underlines  the  importance 
of  the  proposals  which  the  Commission  is 
preparing  on  mutual 
and 
to 
standards. 
boosting  the  job  creation  effect  of  the 
single  market  which  has  already  led  to  the 
creation  of  several  hundred  thousands  jobs 
according 
the  economic  evaluation 
carried  out by the Commission  in  1996. 

They  should  contribute 

recognition 

to 

Electronic  Commerce 

of 

the 

development 

Globalisation,  the  growth  of  information 
and  communication  technologies  (ICTs) 
and 
electronic 
commerce  offer  enormous  opportunities 
for  the  EU  to  improve  its  competitiveness 
In  view  of  the 
and  create  new  jobs. 
potential  impact  of  ICTs  on  training  and 
employment,  and  in line  with  the  mandate 
of  the  Luxembourg  Jobs  Summit, 
the 
is  currently  preparing  a 
Commission 
the 
report  for 
results  obtained 
future 
prospects  for  electronic  commerce,  the 
development  of open networks and the  use 
of multi-media  for  education  and training. 

the  Vienna  Summit  on 

to  date  and 

Taxation  and  employment 

in  November  1997, 

On  several  occasions,  the  last  time  in 
Luxembourg 
the 
that 
European  Council 
taxation  policy  in the,EU  should  be  geared 
to  making  tax  systems  more  employment 

stressed 

has 

in 

labour.  An 

important  step 

friendly.  Among  other  things,  this  requires 
reversing  the  current  trend  in  tax  structures 
towards  shifting  the tax  burden  from  capital 
this 
to 
direction  was  made  on  1  December  1997, 
when  the  ECOFIN  Council  agreed  on  a 
package  to  tackle  harmful  tax  competition 
This  package, 
in  the  European  Union 
consisting  of a code  of conduct  for  business 
taxation  and  an  agreement  on  elements  for 
the taxation  of  income  from  savings  and  the 
taxation  of  interest  and  royalty  payments 
respectively,  will 
between 
increase 
for 
Member  States  to  reduce  the  tax  burden  on 
labour. 
the 
The  Commission  has 
two  draft  directives 
meantime  presented 
based  on  the  orientations  agreed  by 
the 
December  1997  ECOFIN  Council.  Another 
possibility  for  reducing  the  tax  burden  on 
labour  is the  Commission's  proposal  for  an 
energy  product  tax  which  could  contribute 
to  job  creation  assuming  that  the  revenues 
from  taxation  of  natural  resources  would  be 
used to reduce  social  security  contributions. 

companies, 
the 

for  manoeuvre 

room 

in 

Making  Europe  more  entrepreneurial 

A  simple  environment  for  business  start 
ups  and  encouraging  entrepreneurship  are 
essential  for  creating  new  and  better  jobs. 
Action  at  the  EU  level  is  aimed  at  creating 
and  sustaining  a  positive  environment  for 
all  sectors  of  the  economy  in  which  new 
sources  of jobs  are  identified  and  where  the 
job  creating  potential  of  growth  sectors  and 
services  is encouraged  rather than  hindered. 

-  BEST  Task  Force 

recently 
The  BEST  Task  Force  has 
submitted  its  report  on  how  to  improve  the 
business  environment  with  a  view 
to 
encouraging  enterprise  and  removing  or 
reducing  obstacles  and  barriers,  especially 
for  SMEs.  The  Report,  which  contains 
recommendations  which 
be 
addressed  at  the  European  level  as  well  as 
by  the  Member  States,  has  been  forwarded 
to  the  Cardiff  Summit.  The  Commission's 
BEST 
response 

individual 

need 

the 

to 

to 

the 

recommendations  will  form  an  overall 
strategy  for  action  before  the end of  1998. 
In  its  recent  Communication  Fostering 
Entrepreneur ship 
the  Commission  has 
importance  of 
again  underlined 
promoting  an  enterprise  culture  and  a 
business  -  friendly  environment,  and  the 
need  for  a concerted  effort  at  Community, 
national  and  local  levels  to  identify  and 
implement  measures  in  a  coherent  and 
include 
consistent  way. 
training, 
promoting 
services, 
improving  business 
administration, 
simplifying 
accessing 
and 
encouraging  innovation  and  better  access 
to  finance. 

Priorities 
and 
support 

technologies 

education 

public 

new 

of 

series 

For its part, the Commission  will  promote 
a 
actions 
a 
Communication  on  Training  for  SMEs 
and the setting  up of a Business  Education 
Network of Europe (BENE). 

including 

those 

-  Access to Finance 
Lack  of  finance  hinders  the  setting  up  of 
businesses or limits their growth  potential, 
especially  SMEs  and 
launching 
innovative  products  or  services.  Lack  of 
financial  flexibility  due to over reliance on 
short  term  loans  increases  the  risk  of 
failure,  especially  in  times  of  recession. 
The  widespread  practice  of  late  payment 
liquidity  problems, 
further  aggravates 
especially  for SMEs. 

In  its  Communication  Risk  Capital:  A 
Key  to  Job  Creation  in  the  European 
Union,  the  Commission  has  analysed  the 
damaging  impact  of  an  inadequate  equity 
culture  on  the  growth  and  employment 
innovative 
capacities  of  fast  growing, 
companies.  In  addition  to  implementing 
the action plan aimed at opening European 
capital  markets  and  strengthening 
the 
European  equity  culture  for  our  European 
business,  a  series  of  other  barriers 
(cultural, taxation, regulatory,  bureaucratic 
fragmentation)  need  to  be  addressed  -
mostly  by  Member  States. The  Union  has 
to  create  an  economic  environment 
whereby  new  ideas  can  be  developed 

swiftly  and  profitably  inside  the  Union,  for 
the global market place. 

will 

Commission 

The 
propose 
improvements  to  credit  finance,  especially 
in  the  stait-up  phase  through  the  Third 
Round  Table  of  Bankers  and  SMEs,  and 
study  the  possible  setting  up  of  an  SME 
investment agency at EU level  based on the 
successful  Small  Business 
Investment 
Corporation in the US. 

To  ensure  coherence  in  implementing  the 
policy  measures  at  all  levels  on  fostering 
entrepreneurship,  an  annual  report  focusing 
on  main  priorities  not  covered  by  the 
National  Action  Plans  will  be  prepared  for 
the Council and the European  Parliament. 

literature, 

significant 

Culture and employment 
The  various  strands  of  the  culture  industry 
(heritage, 
press,  music, 
performing  arts,  visual  and  audio-visual 
media  and  socio-cultural  activities)  are  a 
major  economic  and  social  force  in  the 
job 
European  Union  with 
creating  potential.  Recent  studies  suggest 
that  in  1995  the  number  of  jobs  in  this 
sector,  including  artistic  crafts,  exceeded  3 
million,  or  some  2%  of  EU  employment 
Indeed 
the  cultural  sectors  provide  an 
interesting testing  ground  for  new  practices 
linking 
and 
geographical  mobility,  and  innovative  new 
approaches  which  can  create  new  jobs. 
Although multimedia groups operating on a 
global  economy  have  emerged,  small  and 
self-employment  continue  to  predominate 
in the sector. 

occupation 

versatility, 

the  development  of 

The possibilities offered  by multimedia and 
on-line  services  in  the  information  society 
are  developing  fast.  However,  public 
support  may  also  be  required  to  contribute 
the  necessary 
to 
encourage 
infrastructures 
entrepreneurship, 
especially 
access to  finance,  as well  as  helping  to fill 
the  skills  gaps  with  new  training  and  re 
training  facilities. 

to 
including 

and 

A  Strong  Social  Dimension  Open  to 
Change  and  Facing  Up 
to  New 
Challenges 

for 

three 

interlinking  objectives 

The  Commission  has  adopted  a  new 
Social  Action  Programme  1998-2000 
which  provides  a  framework 
the 
continuing development of social policy at 
EU  level.  The  Programme  is  structured 
around 
the 
promoting  jobs,  skills  and  mobility; 
changing  world  of  work  and  an  inclusive 
society.  Employment  is  central  to  the 
approach  set  out 
this  programme 
in 
because  it  is  a  Europe  at  work  that  will 
sustain  the  core  values  of  the  European 
social model. 

Within  this  framework,  the  Commission 
has  launched  debates  on  a  number  of 
issues such as modernising  and  improving 
social  protection  systems; the  implications 
of  demographic  change  for  economic, 
social  and  employment  policies  and  the 
need  to  bring  undeclared  work  into  the 
open. 

Improving Social Protection 

to 

the  employability  of 

income  maintenance 

Increasing 
those 
excluded from the labour market  is now a 
central  aim  of  social  protection  policy, 
and 
next 
prevention  of  social  exclusion. 
In  line 
with  the  Commission  Communication  of 
12  March 
1997  Modernising  and 
Improving Social Protection in the EU, the 
Commission  is  currently  examining  how 
the  social  protection  system  can  be  made 
It  is  in  this 
more  employment-friendly. 
the  Commission  has 
perspective 
studied, 
report  Social 
recent 
in 
Protection 
in  Europe  1997,  Member 
States  initiatives  to  tighten  eligibility  for 
benefits,  strengthen  incentives  to  work, 
shift  to  activs  measures  to  help  those  out 
of  work  find  a  job,  extend  job  creation 
schemes, reduce reliance on benefits,  help 
people  with  disabilities  and  reverse  the 
trend 
retirement  while 
towards  early 
encouraging partial retirement. 

that 
its 

- 

Industrial Change 

The  High  Level  Group  on  the  economic 
and social implications of industrial change, 
which the Commission  launched earlier this 
year 
the  Job  Summit 
to 
Conclusions, has prepared and submitted  an 
interim report which  has been  forwarded  to 
the Cardiff  Summit. 

in  response 

To 

restructuring. 

The  Report  emphasises  that  an  effective 
social  dialogue  based  on  mutual  trust  and 
information  is  vitally  important  both  in 
adjusting  to  change  on  a  continuous  basis 
and  in  handling  difficulties  arising  from 
industrial 
this  end, 
employers,  workers 
governments 
should  share  the  responsibility  for  ensuring 
the  employability  of  the  workforce,  with 
governments 
adequate 
providing 
education 
programmes, 
employers  continuing  developing  the  skills 
of  their  workforces  and  the  workers  using 
every 
their 
qualifications. 

opportunity 

upgrade 

training 

and 

and 

for 

to 

the 

forces 

The  Report  stresses  the need  to  have  a  full 
understanding  of 
driving 
industrial  change,  and  suggests  that  the 
economic  forecasts  and  forward  studies 
produced  by professional  organisations  and 
private 
the 
European  Union  be  gathered  together  and 
disseminated  by a European  Observatory  of 
Industrial Change. 

research  bodies 

through 

-  Social  Dialogue 

EU-level 

The  Social  Dialogue  at  EU  level  has  an 
increasingly  important  role  to  play  in  the 
of 
development 
policy, 
particularly 
information, 
through 
consultation,  employment  partnerships  and 
negotiation.  The  aim  is  to  achieve  greater 
co-operation  and  openness  with,  and 
between, 
to 
encourage 
further  development  of 
contractual  relations  both  at  cross-industry 
and sectoral levels. 

the  Social  Partners  and 
the 

This  dialogue  needs  to  be  adapted  and 
strengthened  in  the  context  of  the  major 
policy 
the  EU, 
particularly  in  the  field  of  employment, 
including work organisation,  flexibility  of 
working life and working time. 

challenges 

facing 

Undeclaredwork* 

u» 

i 

m 

HI  ntn/mmtimemmmm  -

On 7 April 1998, the Commission adopted 
a  Communication  on  Undeclared W0rk 
The Commission's intention is to launch a 
debate  on the  causes  of  undeclared work 
and the policy options available to br*i|| it 
into  the  open.  It  suggests  that  thetl  is, 
firstly,  a  need  to  identify  correctly  the 
causes  and  extent  of  the  problem,  and, 
secondly,  to regard combating undeclared 
work  as  part  of  the  overall  employment 
strategy. 

To the extent that is perceived as an issue 
of  individuals  and  firms  taking  improper 
advantage of the system, public authorities 
must  aim at a greater enforcement  of the 
rules 
through  enhanced  control  and 
through  reducing  the  advantage  of  not 
declaring  work.  As  far  as  undeclared 
work  is  related  to  slow  adaptation  of 
legislation to changes in working patterns, 
a  preventive  approach  is  required. 
It 
should  cover the  liberalisation  of  product 
and  service  markets,  the  adaptation  of 
inappropriate  legislation  and  regulations, 
the  structuring of supply of  services such 
as  care  or  cleaning,  a  decrease  in./the 
taxation  of 
labour  and  a  greater 
involvement  of  the  social  partners  in 
information, enforcement and control. 

has 

issued 

a  view 

a 
The  Commission 
Communication  Adapting  and Promoting 
Social  Dialogue  with 
to 
strengthening  it  at  European  level  and 
linking  the  work  of  the  Social  Partners 
more  closely  with  the  development  and 
implementation  of  EU  policies.  The 
Communication  is  the  result  of  a  wide-
ranging  consultation  exercise  launched  in 

September  1996  and sets  out  a number  of 
key actions with a view to achieving a more 
open  social  dialogue,  more  effective 
the 
and  dialogue 
consultation 
development  of  a  collective  bargaining 
process at European level. 

and 

Complementing  and  supporting  action 
by the Member States 

Reform of Structural Funds 

The  proposals  for  new  Regulations  on  the 
Structural and Cohesion  Funds provide the 
legal framework for financial support in the 
next  programming  period  2000-2006,  in 
line with the Agenda 2000 proposals. 

The  Commission's  intention  is  that  the 
overall envelope for structural and cohesion 
policies should be maintained at the level of 
0.46% of  GNP over the period  2000-2006, 
which amounts to  almost  EUR  287  billion 
(in  1999  prices).  Of  this  amount  about 
EUR 240 billion, including  EUR 21  billion 
for the Cohesion Fund, will  be available in 
the present Member States (compared with 
EUR  208  billion  for  1993-99  on the  same 
price basis).  The remaining EUR 47 billion 
will  be  for  structural  assistance  in  new 
Member States and the candidate countries. 
This  represents  a 
substantial 
commitment  to  the  policy  of  promoting 
economic and social cohesion in Europe. 

further 

The  main  aim  of  this  Structural  Fund 
assistance is to help establish the conditions 
for  sustainable  economic  development 
through  growth, 
competitiveness  and 
employment.  Only  by  ensuring  that  such 
conditions  are  in  place  can  the  aim  of 
safeguarding employment and creating new 
jobs  be  fully  realised.  The  main  areas 
where 
are 
infrastructure,  the  development  of  human 
resources, 
equal 
the  promotion 
opportunities and support for the productive 
sector.  The  impact  on  employment  is 
positive in both the short and long term:  in 
the  short  term  because  assistance  will 
stimulate  demand  for  goods  and  services 

assistance 

provided 

of 

is 

and  in  the  long  term  by  maximising  the 
potential  of  both  human  and  physical 
resources  and  improving  linkage  between 
the 
the  productive  environment  and 
operation of the labour market. 

In 
the  next  period  Structural  Fund 
assistance,  particularly  from  the  European 
Social  Fund,  should  also  contribute  to 
supporting 
the  European  Employment 
Strategy  and the National  Action  Plans on 
Employment  submitted  by  the  Member 
States in accordance with the  Luxembourg 
process. 

Local Development 

to  promote 

job 
Co-ordinated  efforts 
creation  are  increasingly  undertaken  at 
The  Second 
regional  and  local  level. 
Report  on  Local  Development 
and 
Employment  Initiatives, issued  in  January 
1998  indicate  that  these  initiatives  have  a 
significant  job-creation  potential  in  the 
medium-term.  The  proposals  to  reform 
the  European  Social  Fund  and  European 
Regional Development Fund put particular 
emphasis  on developing this potential.  In 
is  now 
this  context,  the  Commission 
providing  support  for  the  development  of 
89 
employment 
covering  some  10%  of  the  population  of 
the  EU.  A  pilot  scheme  "Third  system 
and  employment"  has  been  launched  to 
explore  and  promote 
the  employment 
potential  of  local  initiatives  in  new  types 
of services. 

territorial  pacts 

for 

Fifth RTD Framework Programme 

the 

improvement  of 

The 
international 
competitiveness  of EU industry,  economic 
growth  and  job  creation  are  some  of  the 
challenges  which  the  EU  research  and 
technological  development  policy  must 
help  to  meet. 
Following  the  opinion 
delivered  by  the  European  Parliament  in 
December  1997,  on  the  Commission's 
proposal,  which  had  earmarked  a  budget 
of ECU  16.3 billion  for  the  5-year  period, 
the  Council  adopted  its Common  Position 

on  the  5th  RTD  Framework  Programme 
(1998-2002)  on  23  March  1998.  The 
European  Parliament  and  the  Council  have 
to  reach  agreement  on  this  Framework 
before  the  end  of  this  year.  On  13  May 
1998,  the  Commission  adopted  proposals 
for 8 specific  programmes to implement the 
5"' Framework  Programme. 

of 

the 

The  promotion  of  employment  will  be  the 
major  criterion  for  the selection  of  research 
programmes. 
eight 
Four 
programmes  are  directly  relevant  for  the 
promotion  of  employment.  They  are 
focusing  respectively  on  the  creation  of  a 
user-friendly 
the 
information 
promotion  of  competitive  and  sustainable 
growth,  innovation  and  the  participation  of 
small  and  medium-sized  enterprises,  and 
the improvement of human potential. 

society, 

Environment and Employment 

in 

in 

the 

stated 

Environment 

Commission 
As 
Communication 
and 
Employment  of  18  November  1997, 
building  a  sustainable  Europe  will  require 
important  modifications 
industry, 
transport, energy and agriculture policies as 
well  as  consumption  patterns.  Achieving 
these  modifications  will  require  different 
policy  instruments  and  the  co-operation  of 
all  partners  (public  authorities,  private 
sector,  social  partners  and  NGOs)  at  all 
levels.  It will also require new technologies 
and new investment. 

Much of manufacturing  industry's efforts  to 
date  to  meet  environmental  requirements 
have focussed  on implementing  end-of-pipe 
solutions  which  do  not  usually  result  in 
efficiency  or  productivity  gains,  while 
opting for  clean technology  would  improve 
process  efficiency.  The  potential  for  job 
creation  in  energy  conservation  could  be 
substantial 
considerable 
while 
environmental  benefits  can  be  realised,  in 
particular in the field of climate change and 
acidification.  Also,  combined  heat  and 
power generation schemes contribute to the 
increased  competitiveness  of  industrial  and 

processing 

and  marketing 

commercial  sectors  and  at  the  same  time 
generate  jobs. 
In  the  agricultural  sector 
and  related  downstream  activities,  the 
following  areas  have  potential  for  job 
creation : 
(i) 
of 
agricultural  and  forestry  products,  mainly 
regional products, and organic production; 
(ii) diversification  into non-food  activities 
and renewable raw materials; 
to  environmental 
(iii)  actions 
protection and maintenance of landscapes; 
(iv)  diversification  of  on-farm  activities 
such as tourism. 

related 

The  renewal  of  the  urban  environment 
offers  important job creation  opportunities 
through  investments  in  waste  and  water 
treatments  and  also  through  construction 
activities. 

friendly, 

Consumption  patterns  are  becoming  more 
as 
environmentally 
environmental  and  resource  costs  become 
increasingly  integrated  in  market  prices. 
It  has  been  shown  that  waste  recycling  is 
capable of creating a significant  number of 
new jobs. 

Education,  Training and Youth 

The  Commission's  recent  proposals  for 
three decisions in the domain of Education 
(Socrates),  Training  (Leonardo  de  Vinci) 
and Youth (Youth) extend and broaden the 
current  Community  action  programmes  in 
line  with  the  emphasis  set  out  in  Agenda 
2000  on  improving  knowledge  policies 
within  the  EU.  The  common  central 
objective  of  these  three  proposals  is  to 
support,  at  all  levels,  the  process  of 
lifelong  education  and training.  Together, 
they  seek  to  promote  the  progressive 
construction  of  a  European  educational 
space oriented towards the development of 
of 
competences, 
enrichment 
citizenship  and 
the  development  of 
employability. 

the 

been 

training 

designed 

have 
to 
All 
three 
the  European  Employment 
complement 
formal  and  informal  education 
Strategy: 
is  not  only  an  essential 
and 
and 
employability 
of 
dimension 
adaptability,  but  can  also  support 
the 
development  of  an  entrepreneurial  culture 
and  the  promotion  of  equal  opportunities. 
A  budget  of  ECU  3  billion  has  been 
proposed  by the Commission  for  the 5-year 
period 2000-2004. 

Trans-European Transport Network 

the 
The  Jobs  Summit  also  emphasised 
importance 
Trans-European 
the 
Networks  for  long-term  competitiveness, 
growth and  employment. 

of 

Following  the  Summit  emphasis  on  the 
need  for  firm  timetables  and  financing 
plans, the  Commission,  has  in  co-operation 
with  the  Member  States  reviewed  progress 
and  prospects  in  relation  to  the  14  priority 
projects  identified  at  the  Essen  Summit  in 
December  1994. 

: 

The  overall  picture  is  one  of  significant 
three  projects  are  nearing 
progress 
completion,  all  are under  construction  or at 
an  advanced  stage  of  preparation  and  most 
will  be  completed  by  2005.  This  may  be 
than  originally  envisaged,  but 
slower 
judged  against  the  normal  timescale  for 
very  large  infrastructure  projects  -  and  all 
14 come  into this category  - this  represents 
sound progress, and it is worth noting that it 
has  been  made  at  a  time  of  budgetary 
rigour. 

Latest 
estimates  confirm  that  the  next 
financing  period  (2000-2006)  will  see  a 
significant  increase  of  expenditure  on  the 
14 priority  projects, as many  of them  reach 
the  peak  construction  phase.  The  progress 
already  made 
the 
in 
sustainability  of  public  finances  opens  up 
the  possibility  of  increased 
infrastructure 
spending  within  tightly  controlled  overall 
national  budgets.  As  far  as  Community 
the  ERDF  and 
funding 

is  concerned, 

improving 

the  TEN 

Cohesion  Fund  will  continue  to  provide 
support  and  the  Commission's  proposed 
revision  of  the  TEN  Financial  Regulation 
earmarks  ECU  5  billion  for  this  period. 
Completing 
network  will, 
however,  require  a  combination  of  public 
finance.  This  partnership 
and  private 
approach  can  achieve  more  rapid  project 
implementation 
value-for-
money.  Firm  commitment  is  needed  from 
Member  States  if  the  private  sector  is  to 
invest  in  development  of  suitable  financial 
instruments  and  approaches 

better 

and 

the  projects  underway, 
With  most  of 
particular  attention  will  need  to  be  given 
to  the  Alpine  tunnels,  and  to  the  other 
projects  with  continuing  financing  gaps. 
The  revision  of  the  TENs  Guidelines  in 
1999  will  provide  an  opportunity 
to 
review  priorities.  A  major  effort  is  also 
required  to prepare  for  the  extension  of  the 
TENs  to the accession  countries,  for  which 
I SPA,  provided  for  in  the  Commission's 
Agenda  2000  package,  will  be  the  main 
source  of EU  funding. 

Employment  and  Growth  Initiative 

the  Employment 

the  ECOFIN  Council 
On  April  21, 
adopted 
and  Growth 
Initiative,  due  to provide  ECU  420  million 
over  three  years  for  innovative  and  job-
creating  SME  and  to  help  them  overcome 
some  of 
they 
encounter.  To  respond  to  various  needs 
across  regions  and  sectors,  the  means  are 
divided  between 
complementary 
facilities: 

financial  obstacles 

three 

the 

Investment 
investment 

(risk  capital)  managed  by 

•  A  European  Technology  Facility  Start 
the 
up, 
Fund 
(EIF) 
European 
relevant 
in 
through 
specialised 
funds.  The 
investment 
scheme  will  target  a  segment  of  the 
venture  capital  market  with  a  higher 
inherent  risk,  notably  SMEs  at 
the 
setting  up and  early  stages. 

•  A 

Joint  European  Venture 

action, 
(provision  of  financial  contributions), 
under 
the 
the  establishment  of 
Commission  for 
trans-national  JEV  by  SMEs  within  the 
European  Union. 

the  management 

of 

•  An  SME  Guarantee  Facility,  managed 
by  the  EIF  to  increase  the  availability  of 
loans  to  small  or  newly  established  firm 
through risk  sharing. 

to  assessing  SMEs  access 

Annual  reports  on  the  schemes  will,  in 
addition 
to 
financing,  look  at  the  immediate  effects  on 
employment  creation  as  well  as  the  long 
term  prospects. 

Conclusion 

The  creation  of  new  and  better  jobs  and 
combating  unemployment  continues  to  be 
the  Union's  priority.  The  Member  States 
have  demonstrated  their  determination  to 
make  progress  by  preparing,  adopting  and 
submitting  their  National  Action  Plans  for 
Employment  within  the  tight  timeframe  set 
by  the  Luxembourg  Jobs  Summit.  They 
have  moved  decisively  from  the  guidelines 
phase  to  action. 

too, 

level 

At  EU 
the  Commission's 
proposals  in  relation  to  the  Structural  and 
Cohesion  Funds,  the  5th  RTD  Framework 
Programme,  the  Education,  Training  and 
Youth  Programmes,  as  well  as  non-
spending proposals,  have  been  refocused  on 
This 
the 
demonstrates 
in 
accordance  with  the  new  Article  127(2)  that 
a  high  level  of  employment  be  taken  into 
account 
and 
implementation  of  Community  policies  and 
activities. 

priority. 
commitment, 

employment 
its 

formulation 

the 

in 

this 

reason, 

to  report  regularly 

For 
decided 
European  Council  meetings 
contribution  of  Community  policies 
support  of  employment. 

the  Commission  has 
to 
the 
in 

in  future 
on 

ISSN 0254-1475 

COM(98) 354 final 

DOCUMENTS 

EN 

04  06  08  10 

Catalogue  number  :  CB-CO-98-379-EN-C 

ISBN  92-78-37105-X 

Office  for Official  Publications of the European  Communities 

L-2985 Luxembourg