Commission staff working document accompanying the communication from the Commission to the European Parliament, the Council, the European Economic and Social Committee and the Committee of the Regions - "A renewed commitment to social Europe: reinforcing the open method of coordination for social protection and social inclusion" - Impact assessment {COM(2008) 418 final} {SEC(2008) 2170}
Date: 2008-07-02
Institutions: European Commission
Subjects: European social policy, cooperation policy, economic and social cohesion, evaluation method, health care, impact study, pension scheme, poverty, social integration, social security

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COMMISSION OF THE EUROPEAN COMMUNITIES 

Brussels, 2.7.2008 
SEC(2008) 2169 

COMMISSION STAFF WORKING DOCUMENT 

accompanying the  

COMMUNICATION FROM THE COMMISSION TO THE EUROPEAN 
PARLIAMENT, THE COUNCIL, THE EUROPEAN ECONOMIC AND SOCIAL 
COMMITTEE AND THE COMMITTEE OF THE REGIONS 

"A renewed commitment to social Europe: Reinforcing the Open Method of 
Coordination for Social Protection and Social Inclusion" 

Impact Assessment 

{COM(2008) 418 final} 
{SEC(2008) 2170} 

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TABLE OF CONTENTS 

Executive summary .................................................................................................................... 4 

Modifications following the Opinion of the Impact Assessment Board.................................... 5 

1. 

1.1. 

1.2. 

1.3. 

2. 

2.1. 

2.2. 

2.3. 

2.4. 

3. 

3.1. 

3.2. 

3.3. 

3.4. 

3.5. 

3.6. 

4. 

4.1. 

4.2. 

Historical Background on the Origins and the Evolution of the Social OMC............. 5 

Introduction .................................................................................................................. 6 

The origins ................................................................................................................... 6 

The main features of the streamlined Social OMC...................................................... 7 

Institutional and Policy Developments calling for continued Evolution of the Social 
OMC............................................................................................................................. 8 

Lisbon Reform Treaty from 2009 – social mainstreaming requirement...................... 8 

Social Reality Stocktaking and the revised Social Agenda ......................................... 9 

Making 2010 a European Year of combating poverty and social exclusion................ 9 

The Active Inclusion initiative – anticipated implementation of Common Principles 
through the Social OMC ............................................................................................ 10 

Consultation of main Social OMC partners and the wider Public, and Input from 
Experts ....................................................................................................................... 11 

Overview .................................................................................................................... 11 

The position of Member States .................................................................................. 11 

The views of networks active in the fight against poverty and social exclusion ....... 12 

Results from the public consultation for preparing the renewed social agenda......... 13 

The recommendations of the Network of Independent Experts on Social Inclusion. 13 

Additional elements emerging from academic literature and debates ....................... 14 

Problem Definition..................................................................................................... 16 

Context setting ........................................................................................................... 16 

Trends in social protection and social inclusion ........................................................ 19 

4.3.  Weaknesses in the Open Method of Coordination..................................................... 19 

5. 

5.1. 

5.2. 

5.3. 

Specification of the Objectives and of the Options considered ................................. 21 

General and intermediate objectives .......................................................................... 21 

Policy options............................................................................................................. 21 

Legal basis and the principle of subsidiarity.............................................................. 25 

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6. 

6.1. 

6.2. 

7. 

8. 

8.1. 

8.2. 

8.3. 

9. 

Analysis of Impacts.................................................................................................... 25 

Methodological premise............................................................................................. 25 

Assessment of impacts and feasibility ....................................................................... 26 

How do the Options compare?................................................................................... 32 

Monitoring and Evaluation Arrangements................................................................. 34 

Monitoring ................................................................................................................. 34 

Evaluation .................................................................................................................. 35 

Indicators of success .................................................................................................. 36 

Conclusions ................................................................................................................ 36 

ANNEX 1 – LIST OF REFERENCES............................................................................................... 38 

ANNEX 2 – THE SOCIAL OMC: OBJECTIVES, TOOLS AND STRUCTURES ..................................... 39 

COMMON OBJECTIVES....................................................................................................... 42 

COMMON INDICATORS ...................................................................................................... 40 

NATIONAL STRATEGY REPORTS..................................................................................... 42 

JOINT ASSESSMENTS .......................................................................................................... 42 

PROGRESS.............................................................................................................................. 42 

THE SOCIAL PROTECTION COMMITTEE ........................................................................ 43 

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EXECUTIVE SUMMARY  

This  impact  assessment  will  accompany  the  Communication  on  'A  renewed  commitment  to 
social Europe: reinforcing the Open Method of Coordination for Social Protection and Social 
Inclusion',  which 
the 
the  set  of  Commission 
Communication on the Renewed Social Agenda. 

initiatives  accompanying 

is  part  of 

From  2000  the  Open  Method  of  Coordination  has  successively  been  applied  to  social 
inclusion policy, to pension policy and to health and long-term care policy. In 2006 the three 
separate OMC's were streamlined into one integrated OMC for Social Protection and Social 
Inclusion (hereinafter “Social OMC”).  

The open method of coordination comprises an agreement on EU common objectives, setting 
out  high-level,  shared  goals  to  drive  the  entire  process,  the  definition  of  a  set  of  common 
indicators to  enable  monitoring of progress towards the common  objectives, the preparation 
by  Member  States  of  national  strategic  reports  translating  these  agreed  objectives  into 
concrete policies, and the joint assessment of progress and of policy efforts by the European 
Commission and the Member States in the framework of the Social Protection Committee. 

The overall assessment of the results of the Social OMC by the different actors involved in 
the process has been largely positive. The method has supported mutual learning, promoted 
wider  involvement  of  stakeholders,  increased  awareness  of  the  multi-dimensional  nature  of 
exclusion  and  poverty,  given  impulse  to  the  modernisation  of  social  protection  systems, 
forged  a  shared  approach  to  the  common  challenges  and  brought  to  the  fore  emerging 
common  issues.  However,  outcome  indicators  clearly  point  to  insufficient  delivery  on  the 
common  social  objectives  and,  on  the  basis  of  consultation  of  various  stakeholders  and 
experts, one has to conclude that there are weaknesses in the Social OMC. The analysis points 
to  a  lack  of  political  commitment  and  visibility  and  a  need  for  better  horizontal  policy 
coordination  and  mainstreaming  of  social  protection  and  social  inclusion  concerns  in  all 
relevant  policy  areas.  Furthermore,  there  is  a  need  for  stronger  analytical  underpinning  of 
policy  and  more  involvement  of  regional  and  local  actors  in  the  Social  OMC  process. 
Participation  of  stakeholders  can  be  greatly  improved  and  mutual  learning  can  be  further 
strengthened.  The  need  for  reinforcement  of  the  Social  OMC  is  supported  by  a  number  of 
institutional and policy developments, like the Lisbon reform treaty (with its mainstreaming 
requirement), the social reality stocktaking consultation, the prospect of the European Year of 
combating poverty and social exclusion and the active inclusion initiative.  

If  the  expectations  of  EU  citizens  regarding  social  protection  and  social  inclusion  are  to  be 
met, significant strengthening of the Social OMC is necessary. 

In order to assess the merit of reinforcement of the method and to identify the most effective 
ways to achieve it, three policy options have been retained for in depth examination1.  

The  first  option  is  described  as  the  “status  quo”.  This  takes  into  account  the  fact  that  the 
Social  OMC  is  by  nature  an  evolutionary  process  and  that,  even  in  the  absence  of  major 

1 

Two policy options - complete abandonment of the Social OMC and full integration of the Social OMC 
in  the  Growth  and  Jobs  Strategy  –  have  been  considered  but  have  not  been  retained  for  in  depth 
analysis. The reasons for this are explained in section 5.2. 

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changes, it will continue to evolve through incremental changes and gradual improvements in 
working methods.  

The second option is described as a “fundamental overhaul” of the process. In this option the 
scope of the Social OMC is widened and the process is remodelled to embrace all dimensions 
of  EU  social  policies,  to  ensure  effective  mainstreaming  and  to  become  a  sort  of  'Social 
Lisbon'.  

The third option is defined as “comprehensive and ambitious reinforcement within the present 
structure”. This option builds on the approach used so far in the Social OMC, of consensual 
and  incremental  progress,  but  is  at  the  same  time  “strategic”  and  “forward-looking”,  as  it 
introduces a new dynamic into the system. It proposes to explore new tools and new working 
methods that would be tested and introduced in close cooperation with Member States, with a 
view to reinvigorating the process and optimising its implementation.  

The impact assessment concludes by highlighting the third option as the best choice. It is the 
option  which  best  addresses  the  problems  identified  without  excessively  disrupting  current 
ways of working in the Commission and the Member States. In fact, such an option should be 
implemented gradually, not only because of its resource implications, but also because of the 
need  to  properly  discuss  and  “anchor”  the  envisaged  reforms  with  Member  States  and  with 
stakeholders. 

MODIFICATIONS FOLLOWING THE OPINION OF THE IMPACT ASSESSMENT BOARD 

Following the opinion of the impact assessment board several changes have been made to the 
impact assessment. 

The report more clearly distinguishes between the overall progress on social policy outcomes 
and  progress  that  can  be  linked  directly  to  the  implementation  of  the  Social  OMC.  A  new 
context setting section (section 4.1) has been added to the problem identification chapter and 
references have been included to recent analysis that has shown the bottlenecks the method is 
confronted with.  

Two  extra  policy  options  have  been  brought  into  the  picture,  that  is,  full  integration  of  the 
Social OMC in the Growth and Jobs strategy and the possibility of abandoning the method. 
The  reasons  why  these  options  have  not  been  analysed  in  detail  are  provided  (see  box  in 
section 5.2). 

A paragraph indicating the legal basis of the communication and a comment on subsidiarity 
have been added (section 5.3). 

As regards the comparison of the options retained for in-depth analysis, a new table has been 
added  that  allows  comparison  of  the  options  over  the  four  objectives  proposed  both  on  the 
rating  of  their  impact  on  the  problems  addressed  and  on  their  feasibility  rating  (table  6  in 
section 7). An overall assessment of the three options has been added (bottom row). 

The report more clearly explains that in view of the nature of the communication no elements 
are available to calculate precise impacts of the proposed measures on administrative costs in 
the  Member  States  (only  a  very  rough  assessment  can  be  provided  as  part  of  the  feasibility 
rating).  However,  as  regards  the  impact  on  the  community  budget,  in  terms  of  human  and 

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financial  resources,  more  precise  indications  are  now  given  for  each  policy  option  (section 
6.2). 

Finally, a new section has been added (section 8.3) to illustrate the indicators that will be used 
or elaborated to assess the success of the measures proposed. 

1. 

HISTORICAL BACKGROUND ON THE ORIGINS AND THE EVOLUTION OF THE SOCIAL 
OMC  

1.1. 

Introduction  

The  Open  Method  of  Coordination  (OMC)  is  a  relatively  new  instrument  in  the  history  of 
European integration. Its implementation in the social field belongs to the more structured and 
institutionally based examples. The OMC comprises agreement on common objectives setting 
out  high-level,  shared  goals  to  drive  the  entire  process,  the  definition  of  a  set  of  common 
indicators to  enable  monitoring of progress towards the common  objectives, the preparation 
by  Member  States  of  national  strategic  reports  translating  these  agreed  objectives  into 
concrete policies, and the joint assessment of progress and of policy efforts by the European 
Commission and the Member States in the framework of the Social Protection Committee.2 

The OMC for social protection and social inclusion has proved its worth by supporting mutual 
learning,  by  promoting  wider  involvement  of  stakeholders,  by  increasing  awareness  of  the 
multi-dimensional nature of exclusion and poverty, by giving impulse to the modernisation of 
social  protection  systems,  by  forging  a  shared  approach  to  the  common  challenges  and  by 
bringing to the fore emerging common issues.  

However, even though the simplified and integrated Social OMC as applied since 2006 has 
further  strengthened  EU  capacity  to  support  Member  States  in  their  efforts  to  reform  social 
protection  systems  and  promote  greater  social  cohesion,  the  potential  of  the  method  to 
contribute  to  making  a  real  impact  has  not  been  fully  tapped.  There  are,  for  example, 
weaknesses in the EU's capacity to assess accurately both the social situation prevailing in the 
Member States with respect to the range of social issues, and the action taken to address them, 
and this hampers the capacity to drive the process in the most effective way. Opportunities for 
coordinated policies and mutual learning could also be further exploited. Member States have 
recognised the scope for further developing cooperation in the framework of the Social OMC.  

This initiative sets out, therefore, to build on the achievements to date and see in what way 
EU  action  could  contribute  to  strengthening  delivery  on  the  shared  social  objectives  of  the 
Union.  

1.2. 

The origins 

The roots of the Social OMC go back to the mid-1970s when the first EU Poverty Programme 
was launched. It financed pilot schemes and studies to tackle poverty.  

2 

For  a  more  detailed  description  of  the  OMC  on  Social  Protection  and  Social  Inclusion  and  its  main 
constitutional elements, see Annex 1.  

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In  1992,  two  important  Council  Recommendations  were  adopted,  one  identifying  the 
modernisation  of  social  protection  as  an  issue  of  common  concern  warranting  convergence 
across  Europe;  the  other  establishing  as  a  common  objective  the  guarantee  of  a  minimum 
level of resources.  

With  the  entry  into  force  of  the  Amsterdam  Treaty  in  May  1997,  the  fight  against  social 
exclusion became one of the objectives of the Union, and wider powers were granted at EU 
level to tackle it, although within a framework where the primary responsibility for achieving 
those  objectives  remained  with  Member  States.  A  strategic  goal  was  set  in  Lisbon  2000  of 
becoming  the  "most  competitive  knowledge-based  economy  in  the  world  capable  of 
sustainable  economic  growth  with  more  and  better  jobs  and  greater  social  cohesion."  The 
European Council also agreed on the objective of making a decisive impact on the eradication 
of  poverty  by  2010.  Stemming  from  these  commitments  a  comprehensive  process  of 
coordination at EU level was launched. Common objectives for social inclusion were defined 
at  the  Nice  summit  in  December  2000  and  Member  States  were  invited  to  present  national 
action plans (NAP social inclusion), underpinned by indicators and monitoring mechanisms.  

On the basis of reports from the High Level Group on "Social Protection" on the evolution of 
pension  systems  and  from  the  Economic  Policy  Committee  (EPC),  the  Nice  European 
Council also agreed to exchange experiences in the area of pensions on the basis of national 
strategies  and  in  cooperation  with  the  European  Commission.  One  year  later,  the  Laeken 
European Council (December 2001) launched the OMC on pensions with a three-year cycle 
on  the  basis  of  11  common  objectives  under  three  overall  headings  relating  to  the  systems' 
capacity to attain their social objectives, to financial sustainability and to their responsiveness 
to the evolution of societal needs.  

In  2004  the  European  Council  agreed  to  start  an  OMC  to  support  Member  States’  reforms 
aimed at promoting universally accessible, high-quality and sustainable health and long-term 
care for all citizens. 

1.3. 

The main features of the streamlined Social OMC 

An evaluation of the three social strands of the OMC conducted in 2005 formed the basis for 
streamlining the processes that started between 2000 and 2004 - social inclusion, pensions and 
health and long-term care - into one single Social OMC.  

The overall assessment of the Social OMC among Member States has been largely positive: 
all of them credit it with having promoted a shared understanding of the issues and challenges 
in  the  field  of  social  protection  and  social  inclusion.  Civil  society  and  social  partners  have 
started  to  be  involved  in  the  preparation  of  national  strategies  and  modernisation  of  social 
protection.  Also,  there  are  signs  of  better  administrative  coordination  across  government 
ministries.  Considerable  scope  nevertheless  remains  for  developing  and  consolidating  the 
process, not least as regards the implementation and follow-up of national strategies.  

In  a  Communication  published  in  December  2005,  entitled  "Working  together,  working 
better: A new framework for the open coordination of social protection and inclusion policies 
in  the  European  Union"  (COM(2005)  706  final),  the  Commission  set  out  its  proposals  to 
create  from  2006  onwards  a  streamlined  framework  for  further  development  of  the  Social 
OMC. It took account of experience gained to date, in particular of how the Member States 
and other actors assessed the three social strands of the OMC, but also of wider developments 

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such as the ongoing process of refocusing the Lisbon Strategy. It aimed to create a stronger 
Social  OMC  with  a  heightened  focus  on  policy  implementation,  which  would  interact 
positively with the Strategy for Growth and Jobs, while simplifying reporting and expanding 
opportunities for mutual learning. 

In  concrete  terms  the  earlier  OMCs  in  the  fields  of  social  inclusion  and  pensions,  and  the 
process of cooperation in the field of health and long-term care which had been initiated, were 
brought  together  under  common  objectives  and  simplified  reporting  procedures.  It  was 
decided to structure the process as a three-year cycle, with full reporting and preparation of 
national strategies in the first year and no reporting in the two intermediate years, the latter 
being devoted to in-depth analysis and mutual learning on priority themes.  

Common objectives to underpin the newly integrated framework for the social protection and 
social inclusion process were adopted by the European Council in March 2006. The continued 
validity of these objectives was confirmed by the European Council in March 2008.  

In  September  2006  Member  States  presented  their  first  National  Reports  on  Strategies  for 
Social Protection and Social Inclusion with an integrated coverage of the three policy strands 
of  social  inclusion,  health  and  long-term  care  and  pensions.  These  Reports  from  EU-27 
thereby  launched  the  first  full  cycle  of  the  streamlined  and  simplified  Social  OMC.  The 
streamlined method OMC is designed to encourage Member States to take a more strategic, 
comprehensive and cross-cutting approach in their reporting while still allowing the specific 
characteristics  of  each  strand  to  be  taken  into  account.  The  2007  Joint  Report  assessed  the 
national  reports  and  concluded  that  joint  consideration  of  the  full  set  of  common  social 
objectives  was  helping  to  improve  consistency  and  effectiveness  of  policies.  In  general,  the 
national reports were more strategic than in previous years, focusing on a limited selection of 
priorities and presenting a global strategy for achieving the common objectives. 

2007 was the first year under the streamlined OMC for Social Protection and Social Inclusion 
without  full  reporting.  Following  the  approach  already  taken  in  the  area  of  pensions,  this 
allowed  an  in-depth  examination  of  a  set  of  issues  identified  in  the  Joint  Report  of  the 
previous year for all three strands. The focus on those selected themes – i.e. child poverty, for 
the social inclusion strand; access to health care and evolving long-term care needs, for 'health 
and  long-term  care';  and  longer  working  lives  and  privately  managed  pensions,  for  the 
pensions strand – provided an opportunity for deepened analysis of the issues concerned and 
of the policy responses. A preliminary assessment of that experience shows that this method 
has  served  the  purpose  of  creating  a  shared  understanding  of  the  issues  at  stake  while 
providing Member States with helpful indications of the specific challenges to be addressed in 
order to achieve the common goals.  

2. 

INSTITUTIONAL  AND  POLICY  DEVELOPMENTS  CALLING  FOR  CONTINUED 
EVOLUTION OF THE SOCIAL OMC 

2.1. 

Lisbon Reform Treaty from 2009 – social mainstreaming requirement 

The  Treaty  of  Lisbon,  due  to  enter  into  force  on  1  January  2009,  strengthens  the  social 
provisions of current Treaties in several instances.  

First, the new Article 2 on the objectives of the Union contains a much stronger commitment 
to social justice and solidarity than the current one: "The Union shall combat social exclusion 

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and discrimination, and shall promote social justice and protection, equality between women 
and men, solidarity between generations and protection of the rights of the child".  

A  new  horizontal  "social"  clause  (Art.  5a)  stipulates  that,  "in  defining  and  implementing  its 
policies and activities, the Union shall take into account requirements linked to the promotion 
of a high level of employment, the guarantee of adequate social protection, the fight against 
social exclusion, and a high level of education, training and protection of human health."  

The incorporation of a legally binding reference to the Charter of Fundamental Rights, which 
enumerates  under  Title  IV  "Solidarity"  a  certain  number  of  rights  and  principles,  including 
"the  right  of  access  to  social  security  and  social  assistance",  is  also  relevant  for  the  Social 
OMC.  

Finally,  and  particularly  significant  in  this  context,  Article  140  of  the  Lisbon  Treaty  gives 
explicit  recognition  to  the  Open  Method  of  Coordination  as  an  EU  tool  for  fostering 
cooperation between Member States in the area of social policy, and introduces an obligation 
to regularly inform the European Parliament about developments under the Social OMC.  

2.2. 

Social Reality Stocktaking and the revised Social Agenda 

Following on from its May 2006 Communication "An Agenda for European Citizens" and on 
the basis of a mandate by the European Council, the Commission launched in February 2007 
a broad consultation to examine the dynamics of current social changes. This stocktaking of 
the  social  realities3  launched  a  debate  aiming  to  build  consensus  on  the  common  social 
challenges  facing  the  EU.  Views  were  sought  on  social  trends,  on  the  main  factors  driving 
Europe's transformation, on "well-being" and what contributes to it.  

In November 2007, as part of the Internal Market Review package, the Commission presented 
a  Communication  "Towards  a  new  social  vision  for  the  21st  century"  to  enrich  the  ongoing 
consultation and broaden the debate from analysis to response. It outlined the main changes 
which the EU is experiencing in society, related to the economy as well as in lifestyles and 
values,  and  proposed  a  social  vision  based  on  "life  chances".  It  suggested  that  tapping 
Europe's full human potential and broadening life chances for all would require investment in 
youth, in fulfilling careers, in longer and healthier lives, in gender equality, in active inclusion 
and  non-discrimination,  in  mobility  and  successful  integration,  and  in  civic  participation, 
culture  and  dialogue.  While  delivering  on  this  would  mostly  be  a  matter  for  local,  regional 
and  national  authorities,  the  Communication  pointed  out  that  there  is  scope  for  the  EU  to 
contribute, notably through the reinforced use of existing mechanisms for policy coordination.  

Replies  to  the  consultation  would  feed  into  the  mid-term  review  of  the  Social  Agenda  and 
contribute to the preparation of a shared agenda on access, opportunities and solidarity. As a 
number  of  elements  emerging  from  the  replies  to  the  consultation  are  relevant  to  this 
initiative, a partial summary is provided in Section 3.4 below. 

2.3.  Making 2010 a European Year of combating poverty and social exclusion 

As stated above, Member States and the Commission were invited by the European Council, 
at the launch of the Lisbon strategy in March 2000, to take steps to make “a decisive impact 

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on the eradication of poverty by 2010”. Subsequent European Councils have reaffirmed this 
objective.  Under  the  Social  Agenda  2005-2010  the  Commission  announced  its  intention  to 
propose designating 2010 as the European Year for Combating Poverty and Social Exclusion 
(EY2010), thereby reaffirming and strengthening the political commitment made at the start 
of the Lisbon strategy, knowing that European Years have proved to be a valuable instrument 
for putting European political issues at the top of the EU agenda.  

The  Commission  delivered  on  this  commitment  in  12  December  2007  by  adopting  its 
proposal  for  a  Decision  on  the  EY2010;  Council  adoption  is  expected  by  July  2008.  The 
EY2010  will  complement  action  under  the  Social  OMC  in  particular  by  raising  public 
awareness and reaffirming the importance of both individual and collective responsibility, by 
putting  emphasis  on  the  participation  and  involvement  of  all  actors  concerned,  especially 
giving  voice  to  people  experiencing  poverty  and  social  exclusion,  and  by  restating  the 
commitment of the EU to fight poverty worldwide.  

The  EY2010  will  thus  reaffirm  the  Union’s  commitment  to  solidarity,  social  justice  and 
greater  cohesion,  and  will  promote  consistency  and  boost  support  for  the  overarching 
objectives of the Union. A parallel procedural reinforcement  of the Social OMC could help 
maximise  synergies  between  the  overall  process  and  the  Year,  thereby  improving  actual 
delivery. 

2.4. 

The  Active  Inclusion  initiative  –  anticipated  implementation  of  Common 
Principles through the Social OMC  

In 2006 the Commission carried out a first public consultation on the “Active inclusion of the 
people furthest from the labour market”, underpinned by an integrated strategy based on three 
pillars,  namely  adequate  income  support,  access  to  inclusive  labour  markets  and  to  quality 
social services. On the basis of the results the Commission presented a second consultation in 
October  2007  on  "Modernising  social  protection  for  greater  social  justice  and  economic 
cohesion: taking forward the active inclusion of people furthest from the labour market".  

In  this  latter  Communication  the  Commission  proposed  to  deepen  the  Social  OMC  through 
the  adoption  of  common  principles  in  the  three  strands  of  active  inclusion  by  means  of  a 
Recommendation, which would constitute the basis for Council conclusions and a European 
Parliament  resolution.  The  December  2007  EPSCO  Council  invited  the  Commission  to 
proceed  along  those  lines  on  the  understanding  that  the  Social  OMC  would  be  used,  in  full 
compliance with the principle of subsidiarity, to monitor and evaluate the implementation of 
the  common  principles  according  to  modalities  to  be  agreed  in  the  Social  Protection 
Committee. The Commission Recommendation is expected to be adopted in September 2008 
(and will be subject to a specific Impact Assessment). 

This  process  provides  both  an  illustration  and  a  test-case  of  how  the  Social  OMC  can  be 
enhanced through the elaboration of common principles, which could give new substance and 
strength to the Social OMC tools, i.e. monitoring, benchmarking and peer reviewing.  

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3. 

CONSULTATION  OF  MAIN  SOCIAL  OMC  PARTNERS  AND  THE  WIDER  PUBLIC,  AND 
INPUT FROM EXPERTS  

3.1. 

Overview 

For  the  preparation  of  this  initiative  DG  EMPL  utilised  several  channels  for  dialogue  with 
stakeholders  which  constitute  regular  and  established  features  of  the  process  itself. 
Continuous  exchange  and  interaction  with  the  Member  States  is  ensured  through  the  Social 
Protection  Committee.  As  far  as  other  actors  are  concerned,  one  overall  objective  of  the 
Social  OMC  commits  the  Commission  and  Member  States  to  ensuring  "good  governance, 
transparency  and  the  involvement  of  stakeholders  in  the  design,  implementation  and 
monitoring of policy". In particular under the social inclusion strand, given the decentralised 
nature  of  policies  to  fight  poverty  and  exclusion  it  should  be  ensured  "that  social  inclusion 
policies  are  well-coordinated  and  involve  all  levels  of  government  and  relevant  actors, 
including  people  experiencing  poverty".  Accordingly,  both  the  diagnosis  of  the  problems  to 
be addressed and the inventory of possible solutions take into account the input received from 
representatives  of  Member  States,  civil  society  organisations, 
independent  experts, 
institutional actors at EU level and the wider public. 

3.2. 

The position of Member States  

The  March  2007  European  Council  conclusions  called  for  the  common  social  objectives  of 
Member  States  to  be  better  taken  into  account  within  the  Lisbon  agenda.  The  Social 
Protection Committee responded to this in its 2007 work programme by setting up a working 
group  with  the  mandate  of  looking  into  the  mutual  interaction  between  economic, 
employment  and  social  policies  as  well  as  the  coordination  and  integration  between  the 
Social OMC and the “Partnerships for growth and jobs” under the Lisbon strategy.  

At  its  October  2007  meeting  the  SPC  unanimously  adopted  a  report  including  a  wealth  of 
suggestions for how to improve policy interaction and policy consistency4: 

•  Need  to  reinforce  interaction  and  coordination  at  national  and  European  level  for  further 

improved delivery of Lisbon and Social OMC objectives.  

•  Coordination  of  policies  as  a  key  tool  for  progress  in  the  EU  on  employment  and  social 

issues. 

•  Well-designed social protection systems and social inclusion policies as productive factors 

that interact in a positive way with economic and employment policies. 

•  Improved mainstreaming of social objectives and more evidence-based policies, including 

on the basis of strengthened analytical underpinnings of the Social OMC.  

•  Social  impact  assessments  in  non-social  policy  areas;  large  scope  for  enhanced  mutual 

learning.  

•  More intensive use of existing or newly-commissioned research. 

4 

The summary above is a shortened and somewhat edited version of the full report on the SPC website:

http://ec.europa.eu/employment_social/spsi/spc_opinions_en.htm 

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•  Coverage  of  “feeding  in”  and  “feeding  out”  in  Lisbon  and  Social  OMC  reporting  from 
Member  States  and  in  joint  assessments,  including  the  country  chapters.  Inclusion  of 
assessment of social impacts in Commission evaluations of the Lisbon strategy.  

•  Further development of indicators measuring "feeding in / out". 

•  Development  through  PROGRESS  of  "mutual  interaction"  activities  including  peer 

reviews. 

•  Wider publication/dissemination of the key messages in the Joint Report.  

•  Exploration of social impact assessments under PROGRESS and within the SPC. 

•  Improved cooperation with other committees or high-level groups, e.g. joint examination 

of the National Reform Programmes.  

•  Joint seminars in national capitals gathering officials from all "Lisbon" Ministries in order 

to foster coordination and true integration. 

The SPC also devoted considerable attention in 2007 to exploring ways to further improve the 
working methods under the Social OMC. Agreement was reached on a range of actions, as 
summarised in the 2008 Joint SPSI Report: 

•  A  shift  to  a  more  context-  and  process-oriented  approach,  also  looking  at  unsuccessful 
policies and the continuous adjustment of policies in response to obstacles encountered. 

•  A  more  integrated  and  strategic  use  of  all  available  instruments  to  support  the 

implementation of the Social OMC (notably PROGRESS). 

•  More systematic incorporation of key results in policymaking, resulting from strengthened 

monitoring. 

•  A  reinforcement  of  the  analytical  framework,  including  the  social  impact  element  of 

integrated impact assessments. 

•  Further  governance 

improvements  by  ensuring 

the  continuous 

involvement  of 

stakeholders, including local authorities, throughout the Social OMC policy cycle. 

•  Improved dissemination of results. 

3.3. 

The views of networks active in the fight against poverty and social exclusion 

Civil society organisations’ views tend to converge on several  points. In general, the Social 
OMC  is  seen  as  a  very  relevant  tool  for  EU  action  in  the  social  field  prioritising  needs, 
embracing  big  issues,  promoting  connections  between  various  policy  fields  and  urging 
reforms where needed. However, there is a widespread perception that the Social OMC is too 
weak to deliver convincing results in reducing poverty and reinforcing social cohesion. The 
perceived reduced emphasis on the social dimension after the mid-term review of the Lisbon 
strategy  is  seen  as  a  major  explanation  for  weak  implementation  and  impact.  Among  the 
elements most strongly advocated are:  

•  a reconfirmation of the political commitment to the process; 

•  greater emphasis on the “feeding out” dimension (the contribution of reforms  for  growth 

and job creation to social cohesion); 

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•  a stronger commitment at national level, driven by tighter European guidance as well as an 

intensified mutual learning process between actors and countries; 

•  improved quality of national strategies, in terms of both substance and methodology.  

Civil society organisations also advocate active participation of Parliaments, local authorities 
and other relevant stakeholders in the definition of national strategies.  

3.4. 

Results from the public consultation for preparing the renewed social agenda  

Following  the  consultations  on  the  “social  stocktaking”  and  on  the  “new  social  vision”, 
almost 150 replies were received from a wide range of stakeholders (from 13 Member States, 
regional/local  governments,  national  parliaments/individual  MPs,  social  partners,  NGOs, 
universities/research institutes, religious groups, individual citizens of 10 different MS). Most 
contributions  conveyed  a  firm  belief  that  the  confidence  of  citizens  in  the  European  project 
relies on credible social policies at European level. A number of contributors expressed their 
conviction that Europe still remains the region of the world with the strongest welfare states 
and public services, with the social well-being and the fundamental rights of its people at the 
centre  of  its  political,  social  and  economic  life.  In  this  vein,  several  respondents  underlined 
the  role  of  Europe’s  functioning  social  systems  as  a  factor  conducive  to  productivity  and 
competitiveness and, as such, a precondition for successful economic policies.  

While  many  contributions  expressed  continuing  confidence  in  the  welfare  state,  there  was 
widespread  concern  that  globalisation  might  undermine  social  standards.  A  number  of 
respondents  also  stressed  that  economic  growth  might  not  automatically  reduce  social 
exclusion and poverty. With reference to this, some contributors felt that the EU tended to be 
perceived as a part of the problems stemming from globalisation rather than as a part of their 
solution.  Virtually  all  contributors  pointed  to  the  need  for  a  new  impulse  in  terms  of  social 
policy  at  European  level.  In  particular,  the  challenges  arising  from  globalisation  made  a 
fundamental re-assessment of social policies indispensable. Most of the contributors appeared 
to take the view that the key lies in striking the right balance between social policies on the 
one hand and the drive for economic growth and competitiveness on the other.  

As  regards  the  wider  political  process  in  the  field  of  economic  and  social  policies,  some 
contributors  insisted  that  the  Lisbon  Strategy  remains  the  appropriate  platform.  Other 
contributors,  however,  argued  that  its  current  focus  on  growth  and  jobs  is  too  narrow.  One 
contribution  even  suggested  expanding  the  Lisbon  Strategy  towards  a  renewed  social  and 
sustainable development strategy.  

3.5. 

The  recommendations  of  the  Network  of  Independent  Experts  on  Social 
Inclusion 

The Network of Independent Experts on Social Inclusion was asked to submit practical ideas 
on  how  the  impact  of  the  Social  OMC,  in  particular  the  social  inclusion  strand,  could  be 
strengthened in their country. Experts' recommendations can be summarised as follows: 

•  Focus  more  on  results  (room  to  adapt  objectives  to  national  circumstances,  promote 

targeting, better monitoring, strong country-specific recommendations); 

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•  Increase  the  political  status  of  the  Social  OMC  process,  social  inclusion  policy  at  the 
national level (integration in national political process, involvement of parliaments, high-
level responsibility for SPSI process, link to budgetary process); 

•  Increase  horizontal  coordination  and  mainstreaming  of  social  inclusion  objectives  in  all 
relevant  policies  (horizontal  coordination  e.g.  through  central  coordination  structure, 
especially to better link Social OMC/Lisbon/SDS at all government levels, increased use of 
structural funds for social inclusion); 

•  Involve all levels of government (vertical coordination, also from bottom-up perspective; 

scope to define and disseminate regional good practice); 

•  Ensure  effective  and  high-quality  participation  of  stakeholders  (involvement  throughout 
policy cycle, focus on quality / impact, two-way communication with more feedback and 
transparency,  financial  support  for  participation  and  capacity-building,  recognition  of 
social partners' role also in Social OMC); 

•  Work  more  on  common  indicators  and  introduce  impact  assessment  at  EU  and  national 

level as mainstreaming tool;  

•  Communicate  more  effectively  on  the  Social  OMC  /  SPSI  policy  (national  Social  OMC 

websites, using all media, avoid jargon, focus on subjects people can relate to); 

•  Strengthen  mutual  learning  (strengthened  and  expanded  Peer  Reviews,  higher  political 
profile to outcomes, comparative analysis as basis, more contextualisation, opening up to 
regional and local policymakers, national/sub-national/within organisations). 

3.6. 

Additional elements emerging from academic literature and debates 

There is a recent substantial body of empirical research on the operations of the Social OMC 
at national and sub-national levels, drawing on a wide range of official and unofficial sources. 
Most of the literature focuses on the oldest, most developed OMC processes, i.e. the European 
Employment Strategy and to some extent the Social OMC.  

In  terms  of  strengths  of  this  tool  Zeitlin  (2007)  highlights  three  forms  of  positive  influence 
stemming from the Social OMC. The first is substantive policy changes. He argues that the 
method has helped to raise the ambition of national employment and social inclusion polices 
in several Member States and has stimulated changes both in national policy thinking and in 
national  policy  agendas.  An  example  is  the  addition  to  domestic  agendas  of  issues  such  as 
child  poverty,  homelessness,  pension  reform,  childcare  provision,  gender  equality  and 
integration  of  immigrants.  In  some  cases  Member  States  have  seen  specific  policy  shifts  in 
areas  such  as  tax-benefit  reforms,  active  ageing/lifelong  learning  and  pension  reform.  The 
second  positive 
in  governance  and  policymaking 
arrangements. There has been enhanced vertical coordination between levels of governance, 
and increased consultation with stakeholders and involvement of NGOs. The Social OMC is 
seen  as  a  promising  governance  instrument  for  EU  policymaking  as  it  is  well  suited  to 
pursuing  common  European  concerns  while 
respecting  national  diversity.  Some 
commentators  highlight  the  potential  of  the  Social  OMC  for  building  a  consensus  around  a 
distinctive European Social Model. A third positive influence exerted by the method is mutual 

influences  are  procedural  shifts 

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learning, for example in the identification of common challenges, and in fostering statistical 
harmonisation and capacity-building. 

However,  the  literature  also  highlights  some  shortcomings  of  the  Social  OMC.  The  first  is 
lack  of  openness  and  transparency  since  the  required  participation  of  all  stakeholders 
concerned is often not really achieved. Another perceived weakness is the lack of integration 
into national policy of the strategies presented at EU level with National Reports and Action 
Plans serving more as reports to the EU than as operational policy-steering documents. De La 
Rosa  (2005)  has  even  commented  that  reports  and  action  plans  from  Member  States  are 
simply  legitimising  reforms  already  made.  National  plans  have  been  described  as  purely 
administrative exercises, not demonstrating genuine commitment. 

The fact that the Social OMC bypasses both the European Parliament and, in most cases, the 
national  parliaments,  has  led  to  the  democratic  legitimacy  being  questioned  (Hatzopoulous 
2007).  Some  analysts  regard  the  Social  OMC  as  a  threat  to  the  'community'  method  of  EU 
policymaking whereby the Commission proposes legislation, which is adopted by the EP and 
the  Council,  and  the  ECJ  has  the  power  to  impose  sanctions  on  MS  for  non-compliance 
(Hatzopoulus 2007). However, Hix (2006) argues that competition among Member States is 
fiercer under the social strands of the OMC than under the traditional community method. 

De  La  Rosa  (2005)  defines  the  OMC  as  different  to  previous  'soft'  economic  policy 
coordination  due  to  the  institutionalised  dimension  and  increasing  scope  of  application. 
Indeed  OMCs  have  mainly  been  introduced  or  proposed  in  policy  areas  where  the  Treaty 
provisions are limited due to lack of consensus among Member States to enact legally binding 
directives,  or  in  policy  areas  where  there  is  much  diversity  (employment  and  social 
protection).  Therefore  the  Social  OMC  should  not  be  seen  as  a  threat  but  an  alternative  to 
inaction (Daly 2004, Bache and George 2006).  

Borras and Jacobsson (2004) have identified seven features that they say constitute evidence 
that the Social OMC is a new form of governance: 

(1) 

(2) 

(3) 

(4) 

(5) 

(6) 

(7) 

It  is  mainly  based  on  intergovernmental  cooperation,  where  the  Council  and  the 
Commission play a dominant role. 

It  is  based  on  mechanisms  of  political  monitoring  rather  than  administrative 
monitoring. 

It is an iterative process based on clear procedures. 

It provides for systematic linking across policy areas. 

It links EU and national public action. 

It seeks the participation of social actors. 

It aims at enhancing learning processes. 

On this basis, they argue that it has been a 'breath of fresh air' to the mechanisms of the EU 
and that it could lead to new dynamics in the process of European integration. 

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4. 

PROBLEM DEFINITION 

4.1. 

Context setting 

As  illustrated  in  the  previous  chapter,  there  is  a  rather  general  agreement  among  Member 
States,  relevant  stakeholders  and  researchers  that  the  OMC  for  Social  Protection  and  Social 
Inclusion has produced important value added over the years. It is perceived as a useful and 
politically  acceptable  way  for  Member  States  to  work  together  on  often  similar  challenges. 
The OMC has kept the issues of poverty and social exclusion and social protection on the EU 
policy  agenda  in  a  way  it  had  not  been  previously.  This  has  led  to  a  more  balanced  policy 
approach aimed at simultaneously reaching economic and social policy objectives. The OMC 
has also contributed to building a consensus around what the key policy priorities are and it 
has played a role in shaping general social policy approaches across member states (e.g. the 
active  inclusion  approach,  pension  policies  based  on  the  recognition  that  sustainability  and 
adequacy need to go hand in hand).  

Because  of  the  reporting  requirements  many  of  the  Member  States  have  started  producing 
more  integrated  policy  strategies  and  action  plans.  In  several  countries  the  OMC  has  led  to 
better policy coordination across different policy sectors and levels of government. This has 
been  particularly  evident  in  the  new  Member  States  as  a  result  of  the  Joint  Inclusion 
Memorandum process.  

The  Social  OMC  has  promoted  the  mobilisation  of  a  broad  range  of  actors,  especially  civil 
society and including the participation of those experiencing poverty and social exclusion. It 
has  also  undoubtedly  led  to  better  data  collection  and  to  the  development  of  appropriate 
indicators. It has facilitated better and more comprehensive analysis of the situation in relation 
to social protection and social inclusion at both EU and national levels. There is now a better 
basis  for  developing  evidence  based  policy.  The  commonly  agreed  indicators  have  made  it 
possible  for  Member  States  to  compare  their  performance.  Over  time  there  has  been  a 
growing exchange of learning and good practice. 

Although there is a high degree of consensus around this largely positive appreciation of the 
value added that has been produced by the Social OMC so far, there is an equally high degree 
of consensus around the recognition that there still is a long way to go when measured against 
the common objectives regarding social protection and social inclusion agreed by the Member 
States. 

Of course, there are limits to what can be achieved using an instrument like the Social OMC 
that is based on voluntary cooperation and the principle of subsidiarity. The method doesn't 
provide  sanctions  that  can  be  applied  if  Member  States  do  not  make  progress  towards  the 
agreed  objectives  and,  unlike  the  Growth  and  Jobs  process,  there  is  no  basis  for  making 
formal  Council  recommendations  to  individual  Member  States.  It  also  has  to  be 
acknowledged  that  some  of  the  required  policy  changes  and  governance  reforms  will  not 
produce results overnight. The next two sections present the problem definition that is at the 
basis of this initiative on strengthening the Social OMC.  

First,  some  information  on  trends  in  social  protection  and  social  inclusion  outcomes  is 
presented as measured on the basis of the commonly agreed indicators. The trends described 
provide an eloquent picture of the challenges ahead and of the need to boost efforts towards 
the achievement of the common objectives.  

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The second section looks into the method as it currently operates and identifies a number of 
weaknesses that should be addressed if Member States are to be adequately supported in their 
efforts to ensure social protection and social inclusion of EU citizens.  

4.2. 

Trends in social protection and social inclusion5  

In  2005,  16%  of  EU-25  citizens  lived  under  the  poverty  threshold  defined  as  60%  of  their 
country's  median  income,  a  situation  likely  to  hamper  their  capacity  to  fully  participate  in 
society.  This  rate  ranged  from  10%  in  the  Netherlands  and  the  Czech  Republic  to  20%  or 
more in Latvia, Greece, Spain, Italy and Lithuania. Women are more exposed than men, with 
the gender gap particularly acute for single parents and elderly living alone. 

Children are often at greater risk of poverty than the rest of the population (19% in the EU-
25). This is true in most countries, except in Belgium and Slovenia where the poverty risk for 
children is the same as the overall rate, and in Denmark, Germany, Cyprus and Finland where 
children are at lower risk than the general population. 

In the last 10 years, there have been no signs of an overall reduction in poverty rates at EU 
level,  but  situations  differ  across  countries.  At-risk-of-poverty  rates  have  even  increased  in 
some countries (DE, SE, FI), but have decreased in others that have boosted their strategies to 
fight poverty (IE, UK), giving reason to believe that EU Member States can learn from each 
other about how to make a decisive impact on the eradication of poverty and social exclusion. 

In 2007, some 9.3% of EU-27 working-age adults (aged 18-59; not students) lived in jobless 
households.  This  rate  has  not  improved  since  2000  in  the  EU  overall,  despite  the  general 
improvement in employment rates observed in all EU countries, illustrating that new jobs do 
not necessarily go to those families that need them most. This rate ranged from less than 4.5% 
in Cyprus, to just below 12% in Hungary and Poland and more than 12.5% in Belgium.  

Joblessness of parents also affects children. Living in a household where no-one works affects 
both their current living conditions and future development. In 2007 9.4% of children in EU-
27  lived  in  jobless  households.  However,  families  with  children  are  more  affected  by 
joblessness  in  some  countries  than  in  others.  The  share  of  children  living  in  jobless 
households  varies  greatly  across  Member  States,  ranging  from  2.5%  in  Slovenia  and  4%  or 
thereabouts  in  Cyprus,  Greece  and  Luxemburg,  to  13%  in  Belgium  and  Bulgaria  and  up  to 
16.7% in the UK. In the EU as a whole, the situation has not improved since 2000 and in half 
of the countries, the general increase in employment rates has not benefited those families that 
are  furthest  away  from  the  labour  market.  BG,  EE,  EL,  ES,  IT,  LT,  and  to  a  certain  extent 
DK, LU and the UK are the only countries to have shown signs of improvement. 

Having a job does not always protect people from the risk of poverty. In 2005, 8% of EU-25 
citizens in employment (aged 18 and over) lived under the poverty threshold. National data 
indicate that in-work poverty has increased over the last ten years, as a result of factors such 
as an increase in precarious employment, low wages and low work intensity of families. The 
rate  ranges  from  3-4%  in  the  Czech  Republic,  Belgium,  Denmark,  the  Netherlands  and 
Finland  to  13-14%  in  Greece  and  Poland.  On  average  in  the  EU  the  impact  of  social 

5 

This  section  is  based  on  Eurostat  data  and  on  the  indicators  commonly  agreed  in  the  context  of  the 
Social OMC (Portfolio of overarching indicators and streamlined social inclusion, pensions and health 
portfolios. See: http://ec.europa.eu/employment_social/spsi/common_indicators_en.htm ). 

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transfers  other  than  pensions  (such  as  family  and  unemployment  benefits)  produces  a 
significant reduction of the poverty risk for the overall population (by 38%). The impact of 
social  transfers  is  higher  on  child  poverty  than  on  overall  poverty  for  the  EU  as  a  whole 
(42%) as well as in most of the countries. In DK, DE, FR, AT, SI, FI and SE, these transfers 
reduce the risk of poverty for children by 55% or more. In EL, ES and LV this reduction is 
less than 20%. 

With  respect  to  the  pensions  strand,  in  the  EU  as  a  whole  19%  of  the  elderly  (aged  65  and 
over)  are  at  risk  of  poverty,  against  16%  for  the  overall  population.  Among  them,  elderly, 
often single, women face the highest risks (21%). The picture differs across the EU since the 
at-risk-of-poverty rates of people aged 65 or more range from less than 10% in CZ, LU, HU, 
NL, PL and SK to 25% or more in EE, IE, EL, ES, CY, LV, PT and the UK.  

Overall, the situation of the elderly has significantly improved over the last 20 years, thanks 
to pension systems that have in general managed to achieve widespread reduction of poverty 
among  older  people,  and  those  aged  65+  have  an  income  averaging  85%  of  the  income  for 
younger people, ranging from 57% in Cyprus to more than 100% in Hungary and Poland.  

However, recent reforms in many Member States have led to decreases in the average pension 
compared to the average wage of an average worker at a given retirement age (replacement 
rates).  According  to  estimates  by  the  Indicators  Sub-Group  of  the  Social  Protection 
Committee, by 2050 the share of income from public retirement provision is expected to fall, 
to be compensated by private provision and working longer.  

One  of  the  ways  to  ensure  both  sustainability  of  pension  systems  and  an  adequate  level  of 
income  for  pensioners  is  by  extending  working  lives.  The  Lisbon  target  is  to  reach  a  50% 
employment rate of older workers by 2010. In 2006 the employment rate of older workers for 
the  EU-27  was  43,5%  compared  to  37%  in  2001,  and  Sweden,  Denmark,  UK,  Estonia, 
Finland, Ireland, Cyprus, Portugal have reached the 50% mark. However, the target is still far 
away  for  a  group  of  countries  where  the  employment  rate  of  older  workers  remains  around 
30%. 

With respect to healthcare and long-term care, life expectancy has increased spectacularly in 
the last half century. On average, from 1995 to 2005 it increased by three years for men and 
two years for women. However, there are currently wide disparities across the EU, with men's 
life expectancy ranging from 65.4 (Lithuania) to 78.4 years (Sweden) and that of women from 
75.4 (Romania) to 83.9 (Spain).  

Data indicate that all EU countries are faced with substantial inequalities in health within their 
populations. On average disadvantaged social groups are shown to have shorter lives, suffer 
more disease and illness and feel their health to be worse than more well-off groups. Health 
inequalities  are  not  randomly  distributed,  but  reflect  systematic  differences  between  people 
depending on social group, physical and social environments, material conditions, exposure to 
positive and negative factors, and differences in access to health services. 

Against  this  background,  the  2008  Joint  Report  on  Social  Protection  and  Social  Inclusion 
emphasised  the  need  to  step  up  implementation  efforts:  "In  recent  years  social  protection 
reforms and active inclusion policies have contributed to higher growth and more jobs. Still, 

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more needs to be done to ensure that the benefits of an improved economic framework reach 
those at the margins of society and enhance social cohesion. Preventing and tackling poverty 
and social exclusion, and modernising social protection, combining both social adequacy and 
economic sustainability in a framework of sound fiscal policies, is therefore fundamental to 
including 
Europe’s  sustainable  development.  Policy  consistency  and  coordination, 
mainstreaming  gender  equality  and  solidarity  between  generations  are  essential  to  achieve 
the  objective  of  fully  including  the  most  vulnerable  in  society.  Sustained  efforts  will  be 
required during, and beyond, the next cycle of the Lisbon strategy." 

4.3.  Weaknesses in the Open Method of Coordination  

The experience of recent years, the literature reviewed and the inputs received from various 
stakeholders  (section  3)  point  to  a  number  of  weaknesses  of  the  Social  OMC  that  can  be 
summarized as follows: 

–  Lack of political commitment and visibility 

The  political  commitment  to  the  common  objectives  both  at  EU  and  at  national  level  is 
perceived  to  be  low,  not  least  because  of  lack  of  clarity  as  regards  the  objectives  to  be 
achieved. In most of the Member States the National Strategic reports tend to be treated as an 
administrative  reporting  exercise,  not  the  result  of  strategic  policymaking  and  the  common 
objectives have not been consistently translated in country-specific targets. Ownership of the 
process at national level and integration in the national policy process is limited. The common 
objectives  have  insufficiently  been  translated  into  concrete  short  and  mid-term  objectives. 
Monitoring  of  progress  is  weak  and  failure  to  implement  the  strategies  or  to  reach  the  set 
objectives tends to go unnoticed (let alone be sanctioned). Coordination units that support the 
Social  OMC  do  not  have  the  resources  or  the  political  clout  needed  for  effective  policy 
coordination. Both at the EU and at the national level, Parliaments are insufficiently involved. 
The visibility of the Social OMC is generally low. 

–  Need  for  stronger  horizontal  coordination  across  policy  areas  and  mainstreaming social 

protection and social inclusion concerns in all relevant policy areas  

Because  of  the  multidimensional  nature  of  the  challenges  of  social  protection  and  social 
inclusion, they need to be addressed through integrated approaches and with the contribution 
of  many  policies  (economic,  education,  competition,  etc.).  Therefore,  the  common  social 
objectives  should  be  mainstreamed  in  all  relevant  policy  areas.  Policies  aimed  at  economic 
and  employment  growth  do  not  automatically  lead  to  strengthened  social  cohesion.  Both  at 
the  EU  and  at  the  national  level  at  present  there  is  insufficient  mainstreaming  of  social 
objectives and the tools that could contribute, like ex-ante social impact assessment, are often 
lacking. This is both a reflection of weak co-ordination at European level and of a too slow 
learning  process  at  national  level,  where  appropriate  structures  and  procedures  for  policy 
integration are needed. 

–  Need for stronger analytical underpinning of policy 

In  order  to  deliver  results  on  the  ground,  strategies  not  only  need  to  be  backed  by  strong 
political  commitment,  they  also  need  to  be  evidence-based.  There  has  been  considerable 
progress  since  the  start  of  the  social  strands  of  the  OMC  and  work  on  the  thematic  priority 
issues  during  2007  clearly  demonstrated  the  potential  usefulness  of  the  combined  efforts  of 
the Commission, the Member States, various stakeholders and researchers. But data sources 

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and  analytical  capacity  need  to  be  further  developed,  both  at  national  and  at  EU  level,  to 
improve  the  analytical  underpinning  of  policies  so  as  to  reinforce  implementation.  A  recent 
SPC  report  on  child  poverty  and  wellbeing  has  reviewed  strengths  and  weaknesses  of 
Member  States  with  respect  to  the  extent  to  which  policies  are  evidence  based  and  data 
sources and analytical capacity are in place6. It came to  clear-cut  conclusions that countries 
which found their policies on robust analytical bases, large data sources on children at special 
risk, analytical tools, multilevel monitoring systems etc..) are more successful in reaching the 
objectives. 

–  Need to better involve the regional and local level in the Social OMC 

Social protection and social inclusion policies are often implemented at the regional or local 
level.  The  current  process  insufficiently  involves  regional  and  local  decision-makers  and 
stakeholders in planning, policy implementation and mutual learning. Mechanisms for vertical 
coordination are still too weak in a large majority of Member States. Hence, in Member States 
where important responsibilities lie at these levels of government, nationwide strategies risk 
not  being  fully  operational.  Some  Member  States  are  already  implementing  OMC-like 
mechanisms to coordinate action at sub-national level. Stronger involvement of the regional 
and local level could boost delivery on the common objectives. 

–  Participation of stakeholders leaves a lot to be desired 

The involvement of stakeholders in the policy process is both a question of democracy and a 
pre-condition  for  the  efficiency  and  effectiveness  of  policies.  However,  this  only  rarely 
internalised  in  national  decision  making  processes,  and  a  culture  of  partnership  and 
cooperation is often at an embryonic stage. Although progress has been made in recent years, 
there is still a lack of transparency and openness of the Social OMC process, also linked to its 
limited  visibility.  Much  more  attention  needs  to  be  given  to  the  quality  of  stakeholder 
participation, which needs to be both supported (capacity building) and sustained. Today, it is 
often limited to the first stages of the policy process (information, consultation). Stakeholders 
are less involved in policy implementation, monitoring and evaluation, and often receive no 
feedback on the impact of their input.  

–  Need to strengthen mutual learning 

Mutual learning is at the core of the Social OMC. Results have been obtained, but a lot needs 
to be done to strengthen it. The scale of the effort both at the level of coordination and on the 
ground is too limited. Much more opportunities should be provided and the results should be 
used in a more strategic manner. The methodology of mutual learning instruments like peer 
reviews can still be improved and the potential usefulness of other tools needs to be explored. 
The results of mutual learning are not sufficiently disseminated or used in policymaking.  

6 

See: http://ec.europa.eu/employment_social/spsi/docs/social_inclusion/2008/child_poverty_en.pdf 

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5. 

SPECIFICATION OF THE OBJECTIVES AND OF THE OPTIONS CONSIDERED 

5.1. 

General and intermediate objectives 

The  ultimate  objective  of  the  Social  OMC  is  to  contribute  to  progress  with  respect  to  the 
shared social objectives of the EU. By definition, any initiative that effectively reinforces the 
Social OMC in its “modus operandi” will have a positive impact on the achievement of the 
common social objectives.  

As illustrated in the previous sections, while there is wide consensus on the need to reinforce 
the Social OMC, there are quite different views as regards the means to be used and the issues 
to be tackled as a matter of priority. Therefore, it is important to specify a set of “intermediate 
objectives”  that  appear  to  be  particularly  relevant  in  relation  to  achievement  of  the  general 
objective. This will  help  in  identifying the options  available and  assessing them in terms of 
impact and cost/benefit ratio. 

Having regard to the analytical and policy inputs described in the previous sections and the 
Commission’s  internal  deliberations,  the  following  intermediate  objectives  have  been 
identified: 

•  Increase political commitment and visibility of the process in order to enhance delivery; 

•  Strengthen  the  positive 

through  better 
mainstreaming  of  social  objectives  in  other  policy  areas  and  particularly  through  better 
interaction with the “growth and jobs” strategy; 

interaction  with  other  EU  policies, 

•  Reinforce the analytical tools underpinning the process, with a view to moving towards 

the definition of quantified targets and more evidence-based policymaking; 

•  Increase  ownership  in  Member  States,  boost  implementation  and  enhance  mutual 
learning,  through  better  monitoring  mechanisms,  greater  stakeholder  involvement  and 
more effective horizontal and vertical governance arrangements.  

5.2. 

Policy options 

In relation to the objectives identified three policy options have been considered. They can be 
briefly described as follows:  

•  Status  quo:  the  Social  OMC  continues  to  evolve  through  incremental  changes,  on  the 

basis of gradual improvements in working methods (Option 1) 

•  Fundamental overhaul: the Social OMC is remodelled to embrace all dimensions of EU 
social policies, to ensure effective mainstreaming and to become a sort of “Social Lisbon” 
(Option 2) 

•  Comprehensive and ambitious reinforcement within the present structure: a number 
of  substantial  improvements  and  adjustments  are  identified  and  "phased-in"  over  the 
current Social OMC cycle, according to preparedness and resource availability (Option 3) 

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In  addition  to  these  three  options,  which  have  undergone  an  in-depth  examination, 
consideration has also been given to two other options that for the reasons specified in the box 
below have not been retained for further examination. 

Policy options not retained for in depth analysis: 

•  Complete abandonment of the Social OMC: In view of the substantial consensus around 
the positive results of the Social OMC described in section 4.1 this cannot be considered to 
be a real option. The abandonment of the method would result in the loss of an important 
'acquis', for which no viable alternative seems to be available. At the moment, the Social 
OMC  seems  to  be  the  only  tool  that  strikes  an  acceptable  balance  between  subsidiarity 
concerns and the need for coordination at EU level. 

•  Full integration of the Social OMC in the Growth and Jobs Strategy: This option has 
not been retained for three main raisons. First, full integration of the Social OMC would 
risk overburdening the Growth and Jobs Strategy. Due to the multidimensionality of social 
protection  and  social  inclusion  issues,  policy  coordination  in  this  area  is  already  very 
difficult  to  achieve.  Full  integration  of  the  Social  OMC  into  the  Lisbon  Strategy  could 
make  the  process  unmanageable.  Secondly,  such  a  move  would  lead  to  excessive 
instability  of  policy  processes,  given  that  the  Lisbon  strategy  was  re-focused  only  a  few 
years ago. There is a need for stabilisation. Thirdly, the reflection on what will happen with 
the  Lisbon  strategy  after  2010  is  just  starting  and  any  decision  of  modifying  the  Lisbon 
architecture  should  take  place  in  that  context.  Therefore,  such  an  option  could  only  be 
considered as part of that broader reflection.  

The  methodology  for  defining  the  three  options  retained  for  in-depth  examination  is 
essentially  based  on  a  "clustering"  of  the  various  measures  suggested  to  increase  the 
effectiveness  of  the  Social  OMC,  taking  into  account  how  much  they  represent  a  departure 
from  current  arrangements  and  procedures  and  how  much  “consensus  building”  they  would 
require. 

For  example,  the  definition  of  national  quantitative  targets  in  relation  to  European 
benchmarks would represent a departure from the status quo (hence, would not appear in the 
first  option).  On  the  other  hand,  a  generalisation  of  the  “target-based”  approach  would 
represent a “fundamental overhaul” of the system (option 2). Finally, a gradual introduction 
of  quantified  targets  in  areas  where  the  analytical  capacity  justifies  such  a  move  would 
correspond to the option defined as “comprehensive and ambitious reinforcement within the 
present structure” (option 3). 

Very often, the direction of the measures suggested is the same in the three scenarios, but they 
entail a different degree of commitment and a different investment in terms of resources. For 
example, gradual reinforcement of the analytical capacity based on existing resources would 
belong to the “status quo” (option 1); a massive and concentrated effort in data collection and 
development of analytical tools in all areas emerging within the Social OMC would belong to 
the  “fundamental  overhaul”  (option  2);  a  focused  but  substantial  effort  of  statistical  and 
analytical capacity-building in priority areas would be consistent with option 3.  

Table  1  provides  an  overview  of  the  three  options  considered  with  reference  to  the  four 
intermediate  objectives.  The  measures  listed  under  the  three  options  are  a  selection  of  the 
proposals emerging from the literature or from the input provided by various stakeholders. 

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TABLE 1 - Overview of the three options retained for in depth analysis 

Objective to be achieved  

Option 1 

Option 2 

Option 3 

Status quo: the Social OMC continues to 
evolve through incremental changes, on the 
basis of gradual improvements in the 
working methods  

Fundamental overhaul: the Social OMC is 
remodelled to embrace all dimensions of EU 
social policies and to become a sort of 
“Social Lisbon” 

Increase political commitment 
and visibility of the process  

More systematic incorporation of key results 
in policymaking, resulting from 
strengthened monitoring. 
Improved dissemination of results 

Strengthen the positive 
interaction with other EU 
policies 

Continue current work on “feeding-
in/feeding-out”, developing relevant 
indicators and endeavour to achieve better 
mutual interaction between the Social OMC 
and other relevant EU processes under the 
Lisbon Strategy 
Better assess the "social impact" of non-
social policies on the basis of existing tools. 

Targets at EU, national and possibly sub-
national level 
Annual implementation reports 
Strong monitoring of progress by the 
Commission with adequate resources 
Individual recommendations and points to 
watch for Member States 
Strong involvement of the European 
Parliament 
Strong communication strategy at EU and 
national level backed up by the necessary 
resources 

Make the Social OMC a central tool to 
coordinate social policies and to analyse, 
assess and implement the “social dimension” 
of non-social policies.  
Effective mainstreaming based on social 
impact assessment at EU and national level, 
backed up by the necessary resources 
Develop the Social OMC as a powerful 
process, modelled on the Growth and Jobs 
strategy and standing on an equal footing 
with the Growth and Jobs Strategy (see also 
previous point) 

Comprehensive and ambitious 
reinforcement: within the present structure, 
a number of substantial improvements and 
adjustments are identified and "phased-in" 
over the current cycle, according to 
preparedness and resource availability  

Gradually translate the common objectives 
into quantified targets, in line with the 
development of analytical capacity  
Sharpen monitoring of progress 
Make more use of (general) Commission 
recommendations based on a diagnosis of 
countries' key challenges 
Improve the inter-institutional process and 
provide for better information and 
participation of the European Parliament 
Devote more resources to communication 
and dissemination  

Give the Social OMC a prominent role in 
the implementation of the social agenda 
Reinforcing the role of the Social OMC in 
addressing cross-cutting issues  

Better coordination with the Growth and 
Jobs Strategy, based on greater political 
commitment and visibility of the common 
social objectives.  

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Objective to be achieved  

Option 1 

Option 2 

Option 3 

Reinforce the analytical 
underpinnings of the process 

Gradual reinforcement of the analytical 
framework, including the social impact 
element of integrated impact assessments 
Limited use of the available social data in 
which the EU has invested (EU-SILC, 
ESSPROS, etc) 
No or limited investment in new EU 
statistical capacity. 

Major boost in resources leading to strong 
analytical work on all relevant areas of the 
social protection and social inclusion 
strategy  
Full use of new social data. 
Expansion of statistical capacity on all social 
issues not covered by current EU data 
sources 

Develop a common analytical framework on 
core themes, following the example of "child 
poverty"  
Enhanced use of existing social data in 
which the EU has invested (EU-SILC, 
ESSPROS, etc) 
Enhance statistical capacity on priority 
themes emerging within the Social OMC  

Increase ownership in 
Member States, boost 
implementation and enhance 
mutual learning 

More integrated and strategic use of all 
available instruments to support the 
implementation of the Social OMC (notably 
PROGRESS). 

Progressive governance improvements, with 
better involvement of stakeholders, 
including local authorities, throughout the 
Social OMC cycle. 

A shift to a more context-oriented approach, 
also looking at unsuccessful policies, to 
facilitate adjustment of policies in response 
to obstacles encountered. 

Large-scale support to Member States for 
conducting social impact assessment 

Launch a concentrated effort to develop the 
methodology for social impact assessment, 
in cooperation with Member States 

A strong structure for horizontal and vertical 
coordination in MS, chaired by a high-level 
"social coordinator" (similar to the Lisbon 
coordinator) 
National strategies complemented with 
regional and local strategies 
Mandatory guidelines on stakeholders' 
involvement 
Validation of national strategy reports by 
national parliaments 

Range of effective mutual learning 
mechanisms in place ensuring substantial 
participation at all levels of government 

Improve vertical and horizontal coordination 
(voluntary guidelines on governance 
arrangements and on stakeholders' 
involvement)  
Facilitate differentiation along pathways 

Have more peer reviews and experiment 
with new tools for more intensive mutual 
learning 

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5.3. 

Legal basis and the principle of subsidiarity 

The legal basis for the OMC and for this initiative can be found in article 137 of the treaty, 
complemented  by  article  144.  None  of  the  options  that  have  been  examined  are  contingent 
upon the adoption of the Lisbon Treaty, but as explained in section 2.1, the Treaty reinforces 
the need for strengthening the working methods of the OMC. 

All the options examined fully respect the principle of subsidiarity. The OMC builds on the 
voluntary political commitment of the governments of the Member States to coordinate their 
policies  based  on  a  consensus  around  broad  common  goals  regarding  social  protection  and 
social inclusion in order to achieve a greater policy convergence in policy outcomes. It is up 
to  the  Member  States  to  pursue  and  implement  the  common  goals  at  the  national  level, 
choosing  measures  suitable  in  the  context  of  their  respective  circumstances.  The  expected 
integration  effect  is  supposed  to  result  from  the  information  and  learning  process  regarding 
different strategies and their success and not from explicit legislation. None of the proposals 
contained  in  any  of  the  policy  options  departs  from  this  principle.  Any  guidelines  proposed 
will  be  developed  on  a  voluntary  basis.  No  sanctions  are  foreseen  in  case  a  Member  State 
does not respect them. 

6. 

ANALYSIS OF IMPACTS  

6.1.  Methodological premise  

Before  evaluating  and  comparing  the  three  options  considered,  it  is  important  to  clarify  the 
scope of such an evaluation. In fact, there are several ways to evaluate the impact of a policy 
tool such as the OMC (Kohl and Vahlpahl, 2005). One could assess the impact on national 
policymaking: for example, do MS engage in reforms or adopt measures, i.e. in the field of 
pensions, which they would not have considered without the OMC? Alternatively, one could 
assess the impact of the OMC in terms of policy outcomes: for example, has the Social OMC 
led to the implementation of policies that have effectively reduced poverty? Furthermore, one 
could  assess  whether  the  Social  OMC  has  led  to  policy  convergence:  have  Member  States 
developed common approaches to certain policy issues? 

Although  there  is  an  increasing  interest  in  and  some  tentative  empirical  research  on  these 
kinds  of  evaluations,  it  is  still  extremely  difficult  to  provide  robust  evidence  of  causal 
linkages  between  the  operation  of  the  OMC  and  developments  in  terms  of  national 
policymaking, policy convergence or, more importantly, in terms of policy outcomes.  

One should therefore distinguish between the procedural and the substantive impacts of the 
changes  proposed.  This  proposal  is  mainly  concerned  with  procedural  and  governance 
aspects. In this context, the pertinent questions are: Will the measures proposed contribute to 
making  the  Social  OMC  an  adequate  and  viable  mechanism  of  coordination  between  the 
national and European level? Will they make it a better tool for pursuing the common social 
objectives?  

In other words, the appraisal of the measures considered is more a qualitative evaluation of 
their  potential  effects  on  the  OMC  than  of  their  immediate  consequences  on  policy 
outcomes. For this reason, this chapter does not present a separate assessment of the overall 
social and economic impact of the options identified.  

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It is assumed that, to the extent that they lead to a stronger Social OMC, all options identified 
will contribute to positive social impacts, i.e. strengthened social cohesion. It is also assumed 
– in line with the spirit of the common social objectives – that such progress feeds positively 
into  the  Growth  and  Jobs  Strategy  and  to  sustainable  economic  development.  For  example, 
active inclusion policies can not only reduce poverty but also increase labour supply. Pension 
reforms can not only help intergenerational equity but also increase activity rates and public 
finance  sustainability.  Similarly,  good  healthcare  systems  are  not  only  good  for  individual 
well-being but also have positive externalities on labour supply and on labour productivity.  

In view of the nature of the Communication, no direct impact on the environment is expected. 
The  microeconomic  aspects  (administrative  costs,  resource  implications),  however,  are  duly 
taken into consideration in the impact analysis, while assessing the “feasibility” of the various 
options.  

6.2. 

Assessment of impacts and feasibility  

As  a  precise  quantification  of  the  economic  and  social  impacts  is  not  contemplated,  for  the 
reasons explained above, the three options considered have been assessed on the basis of their 
impact on the objectives to be achieved and on the basis of their feasibility. 

The concept of feasibility refers to: 

–  political acceptance; 

–  availability of human resources; 

–  availability of financial means; 

–  administrative burden; 

–  basic tools developed and at our disposal. 

Hence,  the  feasibility  rating  includes  a  rough  assessment  of  resource  constraints  and  the 
potential  administrative  burden  for  the  Member  States.  In  this  regard  no  elements  are 
available  to  calculate  precise  impacts.  As  regards  the  impact  on  the  community  budget,  in 
terms  of  human  and  financial  resources,  preliminary  indications  are  given  for  each  policy 
option. 

The ranking of impact and feasibility is defined as in the table below: 

Table 2 – Ranking criteria 

Impact 

+++ 

positive 

big 
impact 

Feasibility 

highly 
feasible 

++ 
positive 
impact 
feasible 

+ 
small  positive 
impact  

more  or  less 
feasible 

0 
neutral impact 

- 
small negative 
impact 

feasibility 
difficult 
assess 

slightly 
difficult 

to 

-- 
negative 
impact 
difficult 

--- 
very  negative 
impact 

highly 
difficult 

An overview of the estimated impact and feasibility of each option is provided in the tables 
below. 

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Option 1: Status quo - The Social OMC continues to evolve through incremental changes, 
on the basis of gradual improvements in the working methods 

Table 3 – Impact and feasibility of Option 1 

Objective to be achieved 

Rating of 
impact on 
the 
problems 
addressed 

Rating of 
feasibility 

Comments 

Increase political commitment 
and visibility of the process  

+ 

+++ 

Strengthen the positive 
interaction with other EU 
policies 

+ 

+ 

Reinforce the analytical 
underpinnings of the process 

0/+ 

+++ 

Increase ownership in Member 
States, boost implementation 
and enhance mutual learning 

0/+ 

++ 

Some increase in political visibility due to 
use of the results of monitoring in 
policymaking and better dissemination of 
results. 

Some improvement in coordination with 
the Growth and Jobs Strategy. Feasibility 
depends on factors external to the Social 
OMC.  

Limited reinforcement of the analytical 
underpinnings of the process and 
development of social impact assessment. 

A wealth of social statistics in which the 
EU has invested will remain under-
utilised. A lack of investment in statistical 
and analytical capacity in emerging areas 
could weaken the Social OMC in the long 
run. 

A more strategic use of mutual learning 
tools is already in the pipeline. It would 
be feasible for MS to provide for better 
stakeholder participation and greater 
involvement of local authorities, but this 
is unlikely to happen in the absence of 
stronger political commitment, support 
and pressure at EU level. Impact on 
ownership is unlikely to be significant. 

Impact on problems identified 

Incremental  changes  by  implementing  a  number  of  improvements  agreed  in  the  previous 
years are likely to have a positive but limited impact on the problems identified. Moreover, 
the  risk  attached  to  the  “status  quo”  option  is  that  the  Social  OMC  falls  victim  to  “process 
fatigue” and progressively loses credibility and the confidence of its actors and supporters. In 
any  case,  it  seems  unlikely  that  the  improvements  envisaged  under  the  “status  quo”  option 
will be sufficient to give the Social OMC the strength and the effectiveness that are needed to 
respond to citizens’ expectations as regards the European social model.  

Feasibility 

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On  the  other  hand,  the  measures  envisaged  under  this  scenario  are,  to  a  large  extent, 
feasible.  Most  of  these  measures  have  already  been  agreed  by  the  Commission  and  the 
Member  States  (see  Joint  Report  2008).  The  (limited)  increase  in  human  and  financial 
resources that is needed (increased monitoring, better dissemination of results, reinforcement 
of the analytical framework, etc…) can be accommodated through efficiency gains and higher 
reliance  on  external  expertise.  As  regards  the  costs  for  the  community  budget,  the  Social 
OMC  is  supported  by  two  units  in  DG  Employment  and  one  strand  of  the  PROGRESS 
Programme  (approximately  30  million  euro  per  year).  There  is  no  obvious  impact  on 
administrative burden for the Member States. 

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Option 2: Fundamental overhaul: Social OMC is remodelled to embrace all dimensions of 
EU social policies and to become a sort of “Social Lisbon” 

Table 4 – Impact and feasibility of Option 2 

Objective to be 
achieved 

Rating of 
feasibility 

Rating of 
impact on 
the 
problems 
addressed 

Increase political 
commitment and 
visibility of the process  

++ 

-- 

Strengthen the positive 
interaction with other 
EU policies 

+++ 

- 

Reinforce the 
analytical 
underpinnings of the 
process 

+++ 

-- 

++ 

-- 

Increase ownership in 
Member States, boost 
implementation and 
enhance mutual 
learning 

Comments 

Implementing this policy option may lead to a 
substantial reinforcement of the Social OMC, 
significantly increasing its political visibility and 
putting it on an equal footing with the Growth and 
Jobs Strategy. Strong monitoring and individual 
recommendations to Member States should have a 
significant impact. It is doubtful whether enough 
political support will be found to implement this 
option in the short run. Tools will need to be 
developed and analytical work will be necessary to 
support target setting. Resources have to be 
mobilised and there will be an increase in the 
administrative burden for MS (reporting). 

The characterisation of the Social OMC as a strong 
coordination process, similar to the Growth and 
Jobs Strategy, would certainly pave the way for a 
better interaction with other policies, including the 
Growth and Jobs Strategy. 

However, it is unlikely that in the short run there 
will be enough political support among MS to 
move in this direction.  

Strong action on the development of data sources 
and analytical capacity at EU and national level 
will boost evidence-based policy and targeting. 
Substantial investment in the development of social 
impact assessment will make this an effective 
mainstreaming tool. Feasibility in the short term 
seems low because of the need to substantially 
increase resources and to implement quality social 
impact assessment (administrative burden). 

Substantial increase in good governance 
mechanisms at the level of the Member States will 
lead to strong ownership. Full involvement of the 
regional and local level is likely to lead to real 
impact on the ground. Important steps forward in 
the democratic legitimacy of the process 
(involvement of stakeholders and national 
parliaments). Strong investment in mutual learning 
instruments, with a real impact on effective mutual 
learning. Low feasibility in the short term because 
of the need for extra resources. 

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Impact on problems identified 

The measures envisaged under option 2 are likely to go a long way towards solving the 
problems identified, as indicated in the table. In most cases, they aim to achieve an almost 
“ideal” working of the system by means of a combination of considerably tighter procedures 
and massive investment in resources.  

There  are,  however,  downside  risks.  First  of  all,  the  Social  OMC  works  on  the  basis  of 
consensus  and  the  principle  of  subsidiarity.  A  considerable  tightening  of  the  procedures 
proposed by the Commission may be rejected by MS and fail to produce the expected impact 
in terms of ownership. A radical reform of the method, only a few years after the restructuring 
and  "streamlining",  may  not  be  understood  and  may  alienate  the  actors  that  have  supported 
and helped design the Social OMC in its present configuration.  

Feasibility 

The  feasibility  of  this  policy  option  in  the  short  to  medium  term  seems  low.  As  stated 
above, political acceptance by Member States is far from guaranteed. Although there is strong 
recognition  that  Europe  has  a  role  to  play  in  helping  Member  States  tackle  the  important 
social challenges,  MS are very attached to their prerogatives and powers in the social field, 
and  would  probably  be  reluctant  to  accept  some  (or  most)  of  the  measures  envisaged  under 
this  scenario.  At  present,  there  are  no  Treaty  provisions  on  the  basis  of  which  individual 
recommendations  could  be  issued.  Moreover,  this  policy  option  presupposes  a  strong 
investment in human and financial resources. It will also lead to an increased administrative 
burden on governments because of the additional reporting that will be required, the internal 
coordination effort and the requirements as far as participation of stakeholders is concerned. 
In terms of impact on the community budget, a remodelling of the OMC as suggested in this 
option, may require at least a redoubling of staff and financial resources, which may be very 
difficult given current administrative and budgetary constraints.  

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Option 3: Comprehensive and ambitious reinforcement within the present structure: a 
number of substantial improvements and adjustments are identified and "phased-in" over the 
current Social OMC cycle, according to preparedness and resource availability 

Table 5 – Impact and feasibility of Option 3 

Objective to be 
achieved 

Rating of 
impact on 
the 
problems 
addressed 

Rating of 
feasibility 

Comments 

Increase political 
commitment and 
visibility of the process  

++ 

++ 

Strengthen the positive 
interaction with other 
EU policies 

++ 

+ 

Reinforce the 
analytical 
underpinnings of the 
process 

++ 

++ 

+ 

++ 

Increase ownership in 
Member States, boost 
implementation and 
enhance mutual 
learning 

Increased use of quantified objectives will 
contribute positively to visibility and commitment 
if based on a common analytical framework 
supported by a policy theory (how will targets be 
reached). Increased monitoring and better 
exchange with the European Parliament will 
increase the democratic nature and the visibility 
of the process. Greater use of general Commission 
recommendations based on a diagnosis of key 
challenges in each country will strengthen the 
Social OMC. Stronger communication effort 
should make the process more visible. Feasibility 
seems quite high because of the gradual approach, 
although allocation of more resources will be 
necessary.  

A strong role of the Social OMC in the 
implementation of the renewed social agenda and 
better interaction with the Growth and Jobs 
Strategy will certainly help policy consistency and 
integrated approaches to social challenges. This 
option seems feasible, but implementation 
depends on factors outside the Social OMC. 

Increased investment in a common analytical 
framework, data sources and analytical capacity is 
likely to significantly reinforce the process. 
Development of a strong social impact assessment 
toolbox will contribute to mainstreaming social 
protection and social inclusion concerns. Looks 
feasible because of gradual approach, but 
additional investment will be needed. 

Development of voluntary guidelines for 
coordination and participation can lead to 
increased ownership and better implementation. 
Increased number of peer reviews and stronger 
evidence-based assessment can lead to stronger 
mutual learning. Testing of new instruments for 
mutual learning can bring additional benefits and 
lead to a broader impact. There are some 
additional costs involved. Implementation of 
guidelines may bring additional administrative 
burden, but implementation is voluntary. 

EN 

31 

   EN 

 
Impact on problems identified 

Although remaining within the current structure, this option has the potential to make a 
significant impact on the objectives identified, thanks to a mix of consolidation of ongoing 
improvements  and  a  gradual  “phasing  in”  of  innovative  elements.  The  gradual  definition  of 
EU  or  national  targets,  whenever  justified  on  the  basis  of  the  evolution  of  the  common 
analytical framework, would certainly lead to increased political visibility of the process. As 
illustrated by the example of countries that have adopted them, quantified targets can raise the 
accountability of governments and help clarify priorities across all relevant policy areas and 
all  levels  of  government,  provided  that  they  are  based  on  a  strong  analytical  underpinning. 
Reinforced  analytical  capacity  and  mutual  learning  would  improve  the  quality  of 
policymaking in the social area. The development of a common analytical framework would 
help Member States identify the key shared challenges and learn from each other in the areas 
that  are  most  relevant  for  them.  It  would  also  feed  into  other  Community  policies,  and 
through this channel there would be more evidence-based policymaking also in other areas of 
policy;  in  this  way,  the  positive  interaction  with  other  policies,  including  economic  policy, 
would be strengthened.  

Feasibility 

Most of the measures envisaged under this policy option seem feasible. Again, interaction 
with other policies largely depends on factors that are outside the Social OMC. Although the 
changes will be “phased in” only gradually, some reinforcement of the Commission structures 
in charge of the Social OMC will be necessary, but this could be achieved within the current 
financial framework, through reallocation and prioritization. As for financial resources, those 
allocated  under  the  PROGRESS  programme  should  be  broadly  sufficient.  At  national  level, 
better coordination across policy areas (horizontal coordination and mainstreaming) and with 
different  layers  of  government  (vertical  coordination)  will  also  entail  some  additional 
administrative  burden,  but  should  offer  visible  “returns”  also  in  terms  of  efficiency  and 
effectiveness.  Improved  ownership  of  the  process  in  the  Member  States  should  lead  to  a 
reduction of the administrative burden at the national level.  

7. 

HOW DO THE OPTIONS COMPARE? 

The  table  below  compares  the  policy  options  with  regard  to  the  impact  on  the  problems 
addressed and the rating of feasibility. 

EN 

32 

   EN 

 
Table 6 - Comparing the policy options with regard to the impact on the problems addressed and the rating of feasibility 

Rating of impact on the problems addressed 

Rating of feasibility 

Status Quo  
(Option 1)) 

BASELINE 

Fundamental 
Overhauling 
(Option 2) 

Comprehen-
sive/ambitious 
reinforcement in 
present structure 
(Option 3) 

Status Quo (Option 
1) 

Fundamental 
Overhauling 
(Option 2) 

BASELINE 

Comprehen-
sive/ambitious 
reinforcement in 
present structure 
(Option 3) 

Increase political 
commitment and 
visibility of the process  

Strengthen the positive 
articulation with other 
EU policies 

Reinforce the analytical 
underpinnings of the 
process 

Increase ownership in 
Member States, boost 
implementation and 
enhance mutual learning 

+ 

+ 

0/+ 

0/+ 

++ 

+++ 

+++ 

++ 

Overall assessment 

0/+ 

+++ 

++ 

++ 

++ 

+ 

++ 

+++ 

+ 

+++ 

++ 

++ 

-- 

- 

-- 

-- 

-- 

++ 

+ 

++ 

++ 

++ 

EN 

33 

EN 

 
  
 
Based on the analysis developed in the previous section, the conclusions that can be drawn as 
regards the three options considered are as follows:  

Option  1  (Status  quo),  which  is  consistent  with  a  scenario  of  constant  resources  and  full 
continuity  of  the  process,  would  leave  the  problems  identified  substantially  unanswered.  It 
would also entail the risk of these problems getting worse in the medium or long term, calling 
into question the “raison d’être” of the process.  

Option 2 (Fundamental overhaul) is in many respects attractive, and would have the merit of 
showing political leadership and determination on the part of the Commission. It could give a 
strong impulse to social reforms and reinforce the credibility of the Renewed Social Agenda. 
However,  this  option  entails  a  substantial  overhaul  of  working  methods  both  for  the 
Commission  and  for  Member  States,  with  a  significant  mobilisation  of  resources  and 
reinforcement of administrative procedures. Although it can be argued that the costs identified 
could be balanced by potentially strong benefits in the medium and long term, the feasibility 
of option 2 in the short run is doubtful. A Commission proposal to considerably tighten the 
Social  OMC  procedures  may  be  rejected  by  MS  and  fail  to  produce  the  expected  impact  in 
terms of ownership. A radical reform of the method, only a few years after the restructuring 
and "streamlining", may fail to be understood and may alienate the actors that have supported 
and  helped  design  the  Social  OMC  in  its  present  configuration.  Moreover,  such  a  reform 
would  pre-empt  future  decisions  as  regards  the  architecture  and  the  scope  of  the  Lisbon 
strategy after 2010. 

Option 3 (Comprehensive and ambitious reinforcement  within the present structure)  has the 
potential to address the problems identified without upsetting to any great extent current ways 
of working in the Commission and the Member States. It also builds on the approach used so 
far  in  the  Social  OMC,  of  consensual  and  incremental  progress,  but  is  at  the  same  time 
“strategic” and “forward-looking”, as it introduces a new dynamic into the system. It proposes 
to explore new working methods and new tools that would be tested and introduced in close 
cooperation  with  Member  States,  thus  reinvigorating  the  process  and  optimising  its 
implementation. Consequently the preferred option is Option 3. 

8. 

MONITORING AND EVALUATION ARRANGEMENTS 

8.1.  Monitoring 

As indicated in section 6.1, the results and impacts of the Social OMC can be monitored and 
evaluated  in  different  ways,  focusing  on  the  impact  on  national  policymaking,  on  policy 
convergence and on policy outcomes. All of these aspects are covered under the Social OMC 
process that is essentially self–monitoring and evaluating. 

For monitoring the impact of this Communication several instruments are already available. 
There is no need for new instruments. First, as far as the impact on national policymaking 
and policy convergence is concerned: 

Regular monitoring will be ensured by the SPC. At its monthly meetings the Commission and 
the  Member  States  continuously  monitor  progress  on  the  different  topics  included  in  the 
SPC's annual work programme. As an example: one of the priority issues in the coming years 

EN 

34 

   EN 

 
will  be  Active  Inclusion,  and  implementation  of  this  approach  will  be  monitored  within  the 
Social OMC.  

Other  instruments  are  the  networks  of  independent  experts.  Experts  report  regularly  on  the 
impact of the Social OMC both in general and on specific policy and governance topics. The 
network  of  experts  on  social  inclusion  has  supported  the  operation  of  the  Social  OMC  for 
some years. A network of independent experts on social protection is being put in place and 
will start reporting later this year. 

Moreover, there are the EU stakeholder networks that are constantly involved in the various 
activities  of  the  Social  OMC  and  are  in  a  position  to  evaluate  the  results  of  the  method 
through their members at the national level and their EU secretariats. 

Secondly,  as  far  as  the  impact  on  social  protection  and  social  inclusion  outcomes  is 
concerned,  the  use  of  commonly  agreed  indicators  to  monitor  progress  towards  commonly 
agreed objectives is an essential component of the Social OMC policy coordination process. 
The  Indicators  Sub-Group  of  the  Social  Protection  Committee  is  constantly  working  on  the 
further  development  of  the  indicators  set,  as  well  as  the  identification  of  priorities  for  the 
development of EU-level statistical capacity. 

8.2. 

Evaluation  

Member States' National Strategy Reports on Social Protection and Social Inclusion provide a 
basis for the Commission to evaluate policy outcomes and Social OMC impacts by Member 
State (reports will next be presented in September 2008). Conclusions at the level of the EU 
are drawn in the Joint Reports on Social Protection and Social Inclusion. 

Peer Reviews and in-depth reviews in the SPC and the ISG allow Member State participation 
in  evaluating  each  others'  actions  and  progress  in  implementing  effective  and  efficient 
policies. 

The  PROGRESS  programme  provides  funding  for  studies  and  projects  aimed  at  evaluating 
policy outcomes and governance arrangements. 

The  Social  OMC  has  been  the  subject  of  several  comprehensive  evaluations.  For  example, 
during the mid-term review of the Lisbon strategy Member States, other key stakeholders and 
independent experts engaged in an in-depth evaluation of the Social OMC, which led to the 
“streamlining” of the process in 2005.  

Especially with regard to the social inclusion strand 2010, the European Year of Combating 
Poverty  and  Social  Exclusion  will  provide  an  opportunity  to  take  stock  of  Social  OMC 
achievements since the start of the Lisbon strategy. The evaluation will involve stakeholders 
at all levels of government.  

Further,  the  Commission  intends  to  launch  an  external  evaluation  study  under  the 
PROGRESS programme that should provide a detailed assessment of the impact of the Social 
OMC. The results of the study should be available in 2010. 

EN 

35 

   EN 

 
8.3. 

Indicators of success 

In  the  evaluation  study  that  is  to  be  launched  a  framework  of  indicators  of  success  will  be 
developed for monitoring and evaluation purposes. It will cover the objectives retained in the 
communication. Several building blocks of this framework are already available. They have 
been developed over the years within the Social OMC process.  

Especially the Joint Reports on Social Protection and Social Inclusion that contain the lessons 
learnt  over  each  reporting  cycle  provide  a  wealth  of  analysis.  Other  instruments  have  been 
produced in the context of peer reviews, studies and transnational projects financed under the 
SEP and Progress programmes. A few examples: 

–  On  the  visibility  of  the  Social  OMC  in  the  Member  States:  in  preparing  for  this 
communication at the start of 2008 the network of independent experts on social inclusion 
did  an  internet  search  in  an  effort  to  determine  to  what  extent  the  method  and  its  results 
have been mentioned in the national media and among opinion makers.  

–  On  the  use  of  quantitative  targets  (evidence  based  policy):  in  the  Joint  report  on  Social 
Inclusion 2004 there is a table showing to what extent the Member States had set targets in 
their  NAP  Inclusion  2003-2005,  also  indicating  whether  targets  were  put  on  national  or 
commonly  agreed  indicators  and  whether  they  were  outcome,  intermediate  outcome  or 
input targets.  

–  On the mainstreaming of social inclusion concerns in other policy areas. A project funded 
under  the  Social  Exclusion  Programme  investigated  the  concept  and  came  up  with 
proposals on how to measure the extent of mainstreaming of social inclusion concerns in 
public policy in a range of Member States7. 

–  On  the  involvement  of  stakeholders  in  social  inclusion  policy:  at  the  occasion  of  a  peer 
review  on  the  NAP  Inclusion  Social  Inclusion  Forum  organised  in  Ireland  in  November 
2007 a framework of actor involvement variables was put forward. Variables are clustered 
around  several  dimensions:  actors  to  involve,  stages  of  the  policy  process,  degree  or 
spectrum of involvement, quality of the process, preconditions for involvement 8.  

–  On  the  extent  to  which  policy  transfer  takes  place  within  the  OMC.  in  analysing  the 
national strategy reports presented by Member States the Commission always examines the 
extent of convergence around policy approaches that have been identified as good practice 
in the OMC process. Indicators in this respect are e.g. the number of Member States that 
implement  pension  or  health  policies  that  balance  adequacy  /  accessibility  with  financial 
sustainability concerns or the number of Member States  that apply the three  pillar  active 
inclusion approach in their policies for integrating people furthest from the labour market. 

–  On the extent of mutual learning taking place through peer reviews: peer reviews are the 
subject  of  a  double  evaluation  by  participants: 
through 
questionnaires filled out at the end of each peer review seminar and impact evaluation at 

immediate  evaluation 

7 

8 

EN 

See  the  results  of  the  mainstreaming  social  inclusion  in  Europe  project,  notably  a  publication  on  the 
evaluation 
Europe 
http://www.europemsi.org/evaluation_evaluating_MSI_intro.php 
See the synthesis report of this peer review page 18 http://www.peer-review-social-inclusion.net/peer-
reviews/2007/the-napinclusion-social-inclusion-forum/pr-ie-synthesis-report-en.  

mainstreaming 

inclusion 

social 

of 

in 

36 

   EN 

 
                                                 
least  six  months  after  the  peer  reviews.  The  impact  evaluation  is  done  using  a 
questionnaire that contains questions on the degree to which further bilateral contacts have 
taken  place  after  the  peer  review  and  lessons  learnt  have  been  disseminated  or  used  in 
policy development 

9. 

CONCLUSIONS 

The Social OMC has become an important tool for fostering cooperation and coordination of 
Member States in the field of social inclusion and social protection. However, its potential is 
largely underused and a number of weaknesses need to be addressed. 

Three possible courses of action have been identified, discussed and compared. Of these, the 
approach that seems to strike a good balance between the need for reform of the system and 
innovation and the need to preserve the Social OMC achievements is "the comprehensive and 
ambitious reinforcement and upgrading of the OMC but within the present structure".  

This  option  builds  on  the  approach  used  so  far  in  the  Social  OMC,  of  consensual  and 
incremental  progress,  but  is  at  the  same  time  “strategic”  and  “forward-looking”,  as  it 
introduces a new dynamic into the system. It is geared to exploring new working methods and 
new tools that would be tested and introduced in close cooperation with Member States, with 
a view to reinvigorating the process and optimising its implementation.  

Such  an  option  should  be  implemented  gradually,  not  only  because  of  its  resource 
implications,  but  also  because  of  the  need  to  properly  discuss  and  “anchor”  the  envisaged 
reforms  with  Member  States  and  with  stakeholders.  In  practice,  given  that  the  new  Social 
OMC  cycle  2008-2010  has  just  started,  the  preferred  approach  would  be  to  implement 
gradually the proposals starting with those that are more mature and less resource-intensive, 
and proceeding, after required preparatory work and consensus-building on exact modalities, 
with those that are more innovative or require substantial changes. 

EN 

37 

   EN 

 
ANNEX 1 – LIST OF REFERENCES 

Bache, I. and George, S. (2006) Politics in the European Union, Oxford: Oxford University 
Press, 2nd edition. 

Borras, S. and Jacobsson, K. (2004) The Open Method of coordination and new governance 
patterns in the EU, Journal of European Public Policy, Volume 11, No. 2  

Daly, M. (2004) The possibility of an EU Social Policy – Lisbon and After. Paper presented 
at  the  lecture  series  on  Europeanization  and  Reform  of  National  Welfare  State,  October  14, 
Madison: University of Wisconsin-Madison 

De  La  Rosa,  S.  (2005)  The  Open  Method  of  coordination  in  the  new  member  states  –  the 
perspectives for its use as a tool of soft law, European Law Journal, Volume 11, No. 5 

Hatzopoulos, V. (2007) Why the Open method of coordination is bad for you: a letter to the 
EU, European Law Journal, Volume 13, No. 3 

Hix, S. (2006) The European Union as a Polity (I), in Knud-Erik Jørgensen, Mark Pollack and 
Ben Rosamond (eds) Handbook of European Union Politics, London: Sage, pp.141-158. 

Kohl,  J.  and  Vahlpahl,  T.  (2005)  The  "Open  Method  of  Coordination"  as  an  Instrument  for 
Implementing the Principle of Subsidiarity? WP C.S.D.L.E. “Massimo D’Antona”, No. 62 

Zeitlin, J. (2007) Strengthening the social dimension of the Lisbon Strategy, Paper prepared 
for presentation to an informal meeting of the EU SPC, Germany 

Zeitlin,  J.  (2007)  A  Decade  of  Innovation  in  EU  Governance:  The  European  Employment 
Strategy,  the  Open  Method  of  Coordination,  and  the  Lisbon  Strategy,  La  Follette  School 
Working Paper, No 2007-031, The University of Wisconsin 

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ANNEX 2 – THE SOCIAL OMC: OBJECTIVES, TOOLS AND STRUCTURES 

COMMON OBJECTIVES 

The  overarching  objectives  of  the  OMC  for  social  protection  and  social  inclusion  are  to 
promote: 

(a) 

(b) 

(c) 

social cohesion, equality between men and women and equal opportunities for 
all through adequate, accessible, financially sustainable, adaptable and efficient 
social protection systems and social inclusion policies; 

effective  and  mutual  interaction  between  the  Lisbon  objectives  of  greater 
economic  growth,  more  and  better  jobs  and  greater  social  cohesion,  and  with 
the EU's Sustainable Development Strategy; 

good  governance,  transparency  and  the  involvement  of  stakeholders  in  the 
design, implementation and monitoring of policy. 

The following objectives apply to the different strands of work: 

A decisive impact on the eradication of poverty and social exclusion by ensuring: 

(d) 

(e) 

(f) 

access  for  all  to  the  resources,  rights  and  services  needed  for  participation  in 
society,  preventing  and  addressing  exclusion,  and  fighting  all  forms  of 
discrimination leading to exclusion; 

the active social inclusion of all, both by promoting participation in the labour 
market and by fighting poverty and exclusion; 

that  social  inclusion  policies  are  well-coordinated  and  involve  all  levels  of 
government  and  relevant  actors,  including  people  experiencing  poverty,  that 
they  are  efficient  and  effective  and  mainstreamed  into  all  relevant  public 
policies,  including  economic,  budgetary,  education  and  training  policies  and 
Structural Fund (notably ESF) programmes. 

Adequate and sustainable pensions by ensuring: 

(g) 

(h) 

adequate retirement incomes for all and access to pensions which allow people 
to maintain, to a reasonable degree, their living standard after retirement, in the 
spirit of solidarity and fairness between and within generations; 

the  financial  sustainability  of  public  and  private  pension  schemes,  bearing  in 
mind  pressures  on  public  finances  and  the  ageing  of  populations,  and  in  the 
context of the three-pronged strategy for tackling the budgetary implications of 
ageing,  notably  by:  supporting  longer  working  lives  and  active  ageing;  by 
balancing contributions and benefits in an appropriate and socially fair manner; 
and  by  promoting  the  affordability  and  the  security  of  funded  and  private 
schemes; 

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39 

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(i) 

that pension systems are transparent, well adapted to the needs and aspirations 
of  women  and  men  and  the  requirements  of  modern  societies,  demographic 
ageing and structural change; that people receive the information they need to 
plan  their  retirement  and  that  reforms  are  conducted  on  the  basis  of  the 
broadest possible consensus. 

Accessible, high-quality and sustainable healthcare and long-term care by ensuring: 

(j) 

(k) 

(l) 

access for all to adequate health and long-term care and that the need for care 
does not lead to poverty and financial dependency; and that inequities in access 
to care and in health outcomes are addressed; 

quality in health and long-term care and by adapting care, including developing 
preventive  care,  to  the  changing  needs  and  preferences  of  society  and 
individuals,  notably  by  developing  quality  standards 
reflecting  best 
international  practice  and  by  strengthening  the  responsibility  of  health 
professionals and of patients and care recipients; 

that  adequate  and  high  quality  health  and  long-term  care  remains  affordable 
and  financially  sustainable  by  promoting  a  rational  use  of  resources,  notably 
through  appropriate  incentives  for  users  and  providers,  good  governance  and 
coordination  between  care  systems  and  public  and  private  institutions.  Long-
term sustainability and quality require the promotion of healthy and active life 
styles and good human resources for the care sector. 

COMMON INDICATORS 

Defining  common  objectives  in  terms  of  social  protection  and  social  inclusion  implies  the 
definition of common indicators to compare best practices and to measure progress towards 
these common objectives. As such, common indicators do not mean common policies. 

The  broad  methodological  framework  consists  of  a  list  of  primary  and  secondary  indicators 
for  an  overarching  portfolio  and  the  three  strands  (Social  Inclusion,  Pensions,  Health  and 
Long-Term  Care).  Primary  indicators  are  a  reduced  set  of  lead  indicators,  which  cover  all 
essential dimensions of the defined objectives. Secondary indicators are designed to support 
these lead indicators by providing greater insight into the nature of the problem. 

These indicators are used for the overall National Reports on Strategies for Social Protection 
and  Social  Inclusion  and  the  specific  National  Reports  on  the  different  strands  (Social 
Inclusion, Pensions, Health and Long-Term Care) as well as for the joint report presented by 
the European Commission and the Council. 

New common indicators from 2006.  

In  June  2006,  the  Social  Protection  Committee  adopted  a  set  of  common  indicators  for  the 
social protection and social inclusion process.  

EN 

40 

   EN 

 
It consists of a portfolio of:  

•  14  overarching  indicators  (+11  context  indicators)  meant  to  reflect  the  newly  adopted 
overarching objectives (a) "social cohesion" and (b) "interaction with the Lisbon strategy 
growth and jobs objectives";  

•  and three strand portfolios for social inclusion, pensions, and health and long-term care. 

The  use  of  commonly  agreed  indicators  to  monitor  progress  towards  commonly  agreed 
objectives is an essential component of the OMC policy coordination process. 

In this  context, indicators  have been  agreed using a  consensual approach and using a set of 
criteria  which  include  comparability  based  on  sound  EU  harmonised  data,  policy 
responsiveness, clear normative interpretation, focus on outcomes, etc.  

The  ISG  also  agreed  on  a  new  typology  of  indicators  which  distinguish  between  those  that 
can directly be used for benchmarking, and those that can only be used to monitor progress 
within a single country. 

The report that presents the agreed list of indicators identifies a number of areas for further 
development of indicators and statistical capacity-building. 

In  2006  the  decision  was  also  taken  to  enhance  the  role  of  the  ISG  in  developing  common 
analytical  frameworks  for  the  use  and  interpretation  of  indicators  on  specific  themes.  One 
particular topic addressed in 2007 was the issue of child poverty, and in 2006 the focus was 
on  the  adequacy  and  sustainability  of  pensions.  On  these  two  issues,  in-depth  analysis  has 
proved instrumental in drawing common policy conclusions and in fostering evidence-based 
policymaking at the national level. 

As relevant statistics become increasingly available (full implementation of EU-SILC, EHIS 
and SHA9), the use of indicators will be enhanced both at EU and at national level. 

At national level, Member States will continue to use the EU agreed indicators and analytical 
framework  in  the  preparation  of  their  National  Strategy  Report.  In  doing  so,  they  will  be 
better  equipped  to  compare  their  situation  to  that  of  other  EU  countries.  This  year,  a  new 
cycle for the years 2008-2010 has begun and the European Council confirmed in March the 
continued  validity  of  the  Common  Objectives  adopted  in  March  2006.  Member  States  have 
been  asked  to  report,  in  their  renewed  National  Strategic  Reports  on  Social  Protection  and 
Social Inclusion, on progress with respect to the priorities established in the 2006-2008 NSRs. 

At EU level, the Commission and the Council will make increased use of the indicators and 
agreed analytical framework in order to assess Member States' progress towards the common 
objectives  in  the  context  of  the  preparation  of  the  yearly  Joint  Report.  A  yearly  assessment 
will  be  published  in  the  annual  Social  Situation  Report.  The  Commission  will  also  be  in  a 
position  to  contribute  to  the  identification  of  policy  priorities  in  the  Member  States  by 

9 

Instruments  currently  developed  by  Eurostat  which  are  gradually  coming  to  maturity:  EU-SILC:  EU 
harmonised  Survey  system  on  Income  and  Living  Conditions;  EHIS:  European  Health  Interview 
Survey; SHA: System of Health Accounts. 

EN 

41 

   EN 

 
                                                 
providing a broad diagnosis based on international benchmarking on specific themes (such as 
was done on child poverty). 

NATIONAL STRATEGY REPORTS 

Following  the  streamlining  of  the  three  OMC  strands  in  the  social  field  into  one  OMC  on 
Social Protection and Social Inclusion, Member States are now charged with translating the 
common  objectives  into  National  Plans  for  each  of  the  three  areas  of  Social  Inclusion, 
Pensions and Health and Long-Term Care. The first National Report on Strategies for Social 
Protection and Social Inclusion (NSRs) were prepared by Member States in 2006. 

As from 2008 the cycle is synchronised with that of the Strategy for Growth and Jobs. This 
means  that  the  renewed  NSRs  which  Member  States  are  due  to  submit  by  September  2008 
will  cover  a  period  of  three  years.  They  will  be  prepared  on  the  basis  of  a  Guidance  Note 
proposed  by  the  Commission  and  endorsed  by  the  Social  Protection  Committee  at  its 
February 2008 meeting: http://ec.europa.eu/employment_social/spsi/strategy_reports_en.htm 

JOINT ASSESSMENTS 

On the basis of the national strategy reports, the Commission draws up an initial assessment 
which is summarised in a Commission communication: proposal for a joint report on social 
protection and social inclusion, complemented by supporting documents, horizontal analysis 
and  country  profiles.  On  the  basis  of  the  Commission’s  proposal  the  Council  then  adopts  a 
joint  report  on  social  protection  and  social  inclusion  which  is  submitted  to  the  spring 
European Council. In the light years, Member States do not provide national strategy reports 
but supply ad hoc information on the specific themes identified for work during that year.  

PROGRESS 

The Community Programme for Employment and Social Solidarity was established to support 
financially  the  implementation  of  the  objectives  of  the  European  Union  in  the  fields  of 
employment  and  social  affairs,  as  set  out  in  the  Commission  Communication  on  the  Social 
Agenda,  and  thereby  contribute  to  the  achievement  of  the  Lisbon  Strategy  goals  in  those 
fields. PROGRESS supports the implementation of the open method of coordination (OMC) 
in the field of social protection and inclusion. 

PROGRESS  is  the  EU’s  new  employment  and  social  solidarity  programme.  Working 
alongside  the  European  Social  Fund  (ESF),  it  started  in  2007  and  will  run  until  2013.  This 
programme  replaces  the  four  previous  ones  that  ended  in  2006  covering  anti-discrimination 
actions, equality between men and women, employment measures and the fight against social 
exclusion. The EU opted for a single programme to rationalise and streamline EU funding and 
concentrate  its  activities  to  improve  the  impact.  The  EU  set  up  PROGRESS  to  accompany 
Member States' efforts to promote more and better jobs and equal opportunities for all. The 
public  are  looking  to  the  EU  to  strengthen  social  Europe  so  that  it  can  deliver  growth  and 
more jobs and fight poverty and social exclusion. Member States have set targets as part of 
the European Employment Strategy and explained the paths they will follow to achieve them 
in their national action plans. The EU will support this policy development and its delivery in 

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five  areas:  Social  inclusion  and  protection,  Employment,  Working  conditions,  Non-
discrimination, and Gender equality  

PROGRESS  will  ensure  that  EU  social  policy  remains  on  course  to  face  the  key  policy 
challenges  and  concentrates  on  actions  that  need  a  combined  European  effort.  It  will  give 
support to Member States to ensure they deliver on their EU commitments and implement and 
apply  EU  laws  uniformly.  The  work  thus  required  will  be  carried  out  in  partnership  with 
governments, local authorities, employers, trade unions and the voluntary sector. 

PROGRESS  will  fund  three  types  of  actions:  Analysis,  Mutual  learning,  awareness  and 
dissemination, Support to main actors.  

It  will  focus  on  activities  with  a  strong  European  dimension  to  guarantee  EU  added  value. 
These  activities  are  designed  to  inform  policy  analysis  and  development.  In  this  respect, 
PROGRESS  differs from the ESF,  which  invests in  the implementation of employment  and 
social inclusion policies in the Member States. 

PROGRESS  has  a  global  budget  of  €743,25  million  for  seven  years  (2007-2013),  of  which 
30% is assigned to Social protection and inclusion. 

THE SOCIAL PROTECTION COMMITTEE 

In  response  to  shared  challenges  with  respect  to  modernising  social  protection  and  fighting 
exclusion, and on the basis of Article 144 of the EC Treaty, the Social Protection Committee 
(SPC)  was  established  in  2000  to  serve  as  a  vehicle  for  cooperative  exchange  between  the 
European  Commission  and  the  Member  States  with  a  view  to  modernising  and  improving 
social protection systems. 

The Committee's work since the establishment of this group of high-level officials has been 
largely determined by the strategic goal for the EU's socio-economic progress set out at the 
Lisbon European Council of March 2000. 

In  carrying  out  its  tasks  the  Social  Protection  Committee  works  closely  with  other 
Committees dealing with EU-level social and economic policy, most notably the Employment 
Committee (EMCO) and the Economic Policy Committee (EPC). 

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