Special Report No 7/2013 ‘Has the European Globalisation Adjustment Fund delivered EU added value in re-integrating redundant workers?’
Date: 2013-06-27
Institutions: European Court of Auditors
Subjects: European Globalisation Adjustment Fund, collective dismissal, labour market, redundancy, reintegration into working life, worker (EU)

EuropEaN  
Court of audItorS

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HaS tHE EuropEaN GlobalISatIoN  

adjuStmENt fuNd  dElIvErEd Eu  addEd valuE 

IN rEINtEGratING  rEduNdaNt workErS ? 

EN

 
 
 
 
Special report No 7 

 2013

HaS tHE EuropEaN GlobalISatIoN  
adjuStmENt fuNd dElIvErEd Eu  
addEd valuE IN rEINtEGratING  
rEduNdaNt workErS ? 

(pursuant to article 287(4), second subparagraph,  tfEu)

EuropEaN  C ourt of audItorS

EuropEan court of auditors
12, rue alcide d e Gasperi
1615 Luxembourg
LuXEMBour G

tel. +352 4398-1
fax +352 4398-46410
E-mail: eca-info@eca.europa.eu
internet: http://eca.europa.eu

special report no 7 

 2013

more information on the European union is available  
on the Internet (http://europa.eu).

Cataloguing data can be found at the end of this publication.
luxembourg: publications office of the European union, 2013

ISbN 978-92-9241-314-9
doi:10.2865/92721

© European union, 2013
reproduction is authorised provided the source is acknowledged.

Printed in Luxembourg

3

CoNtENtS

Paragraph

Glossary

I–V 

ExEcutIVE summary

1–8 

IntroductIon

9–13 

audIt scopE and approach

14–71 

obsErVatIons

14–24 

 nEarly all workErs wErE  offErEd pErsonalIsEd and wEll-coordInatEd mEasurEs

17–18 

 ServiceS were PerSonaliSed

19–21 

 eGF meaSureS were Generally well-coordinated with national meaSureS  and the eSF

22–24 

 Some member StateS PreFerred the eSF over the eGF

25–46 

 rEIntEGratIon Into EmploymEnt of EGf-supportEd workErs cannot bE  rElIably assEssEd

29–34 

 lack oF reinteGration objectiveS and SPeciFic eGF PerFormance data

35–46 

 reinteGration data were diFFicult to comPare

47–59 

51–53 

 onE thIrd of EGf fundInG compEnsatEs natIonal workErs’ IncomE  support schEmEs, wIth no Eu  
addEd ValuE

 workerS’ income SuPPort meaSureS  rePreSent the majority oF  the co-Funded exPenditure For 
halF oF the caSeS audited

54–56 

 Globally, workerS’ income SuPPort meaSureS  account For one third oF reFunded coStS

57–59 

 diFFerent eGF co-FundinG  in Similar economic circumStanceS

Special report No 7/2013 – Has the European Globalisation adjustment fund delivered Eu added value in reintegrating redundant workers?

 
4
4

60–71 

 thE EGf approVal procEdurE Is too lonG for an EmErGEncy fund

63–65 

 the aSSeSSment Procedure could be Shortened

66–67 

 the budGetary and emPowerment ProcedureS  have a Further imPact on timelineSS

68–69 

 the eGF aPProval Procedure iS  not timely

70–71 

 in the end, the budGetary authority aPProved all the Project S Submitted by the commiSSion

72–81 

conclusIons and rEcommEndatIons

73–75 

 nEarly all ElIGIblE  workErs wErE  offErEd pErsonalIsEd and wEll-coordInatEd mEasurEs

76 

 rEIntEGratIon Into EmploymEnt of EGf-supportEd workErs cannot bE  rElIably assEssEd

77–79 

 onE thIrd of EGf fundInG compEnsatEs natIonal workErs’ IncomE support schEmEs,  
wIth no Eu addEd ValuE

80–81 

 thE EGf approVal procEdurE Is too lonG for an EmErGEncy fund

rEply of thE commIssIon

Special report No 7/2013 – Has the European Globalisation adjustment fund delivered Eu added value in reintegrating redundant workers?

GloSSarY

5

dG budget: directorate-General for the Budget 

dG Employment, s ocial affairs and Inclusion: directorate-General for Employment, s ocial affairs and i nclusion 

Eca: European c ourt of auditors (or ‘the court’)

EGf: European Globalisation a djustment fund

Esf: European s ocial fund

Eu added value:  the Eu added value is the value that an Eu action adds to the value that would otherwise 
have been created by Member states acting alone.

oEcd: organisation for Economic c ooperation and d evelopment; 21 Eu Member states are currently members 
of the oEcd .

workers’ income support: c ash expenditure compensating for unemployment. this includes redundancy 
payments out of public resources as well as pensions to beneficiaries before they reach the ‘standard’ pension-
able age if these payments are made because they are out of work or otherwise for reasons of labour market 
policy. s ee ‘an interpretative guide to the oEcd social expenditure database’, oEcd , 2007.

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EXECutIvE Summar Y

i.
the European Globalisation a djustment fund (EGf) 
was established in 2006 to show Eu solidarity   to  wards 
workers  affected  by  mass  redundancies.  the  EGf 
should facilitate the reintegration into employment of 
those workers by providing financial contributions for 
time-limited and coordinated packages of personalised 
services. such packages include active labour market 
measures such as training, aid for self-employment, 
coaching and outplacement. they also often include 
income support and other allowances paid to workers.

ii.
the European s ocial fund (Esf) also supports redun-
dant workers, mainly through lifelong learning pro-
grammes. However, whereas the purpose of the Esf 
is to address long-term structural imbalances, the EGf 
was designed to address short-term and ad hoc emer-
gency situations. 

iii.
until 31 d ecember 2012, EGf aid packages represented 
627 million euro for 89 approved Member state appli-
cations. the EGf co-finances measures at a rate of 50 % 
or 65 %, with the balance being provided by the Mem-
ber state concerned.

iv.
the court concluded that:

(a)  nearly all EGf eligible workers were offered per-

sonalised and well-coordinated measures.

(b)  Each EGf measure may also be eligible for the Esf  
and some Member states preferred to use the Esf  
rather than EGf.

(c)  no quantitative reintegration objectives were set. 
Moreover, existing data are not adequate to assess 
the effectiveness of the measures in reintegrating 
workers into employment.

(d)  the EGf delivered Eu added value when used to 
co-finance services for redundant workers or al-
lowances not ordinarily existing under Member 
states’ unemployment benefit systems.

(e)  However, in all the audited cases, the court iden-
tified measures to provide workers with income 
suppor t,  which  would  have  been  paid  by  the 
Member states anyway. sixteen of the 19 Mem-
ber states that benefited from the EGf included 
income support measures in their packages. Glo-
bally, income support measures represented 33  % 
of the costs refunded for all EGf cases.

(f )  the EGf approval procedure, requiring the need 
for an ad hoc budgetary procedure, is very long. 
this  hampers  Eu  solidarity  with  the  redundant 
workers targeted. 

v.
the court recommends that:

(a)  the Member states and the c ommission take the 
necessary steps to ensure the availability of up-
to-date and reliable data in order to monitor the 
achievement of objectives, as well as to compare 
the outcome of the various measures;

(b)  the  European p arliament,  the c ouncil  and  the 
commission consider limiting Eu funding to meas-
ures likely to provide Eu added value, rather than 
funding already existing national workers’ income 
support schemes;

(c)  the  European p arliament,  the c ouncil  and  the 
commission consider, as an alternative to the cur-
rent EGf scheme, the possibility of adapting the 
Esf framework and its funding allocations in order 
to support more rapidly workers affected by mass 
redundancies.

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INtroduCtIoN

7

the  European  Globalisation a djustment fund  (EGf)  was  established 
in 2006 to show Eu solidarity towards workers affected by mass redun-
dancies. the EGf should facilitate the reintegration into employment of 
those workers by providing financial contributions for time-limited and 
coordinated packages of personalised services1. such packages include 
active labour market measures such as training, aid for self-employment, 
coaching and outplacement. they also often include income support 
and other allowances paid to workers.

the EGf is outside the multiannual financial framework.  as a result each 
application for EGf support submitted by a Member s tate has to pass 
a thorough assessment by the c ommission and obtain approval from the 
Eu budgetary authority (council and European parliament). the commis-
sion shares the management of the EGf with the Member states.

redundant workers can also benefit from the European social fund (Esf), 
mainly through lifelong learning programmes. However, whereas the 
purpose of the Esf is to address long-term structural imbalances, the EGf 
was designed to address short-term and ad hoc emergency situations.

1  regulation (Ec) 
no 1927/2006 of the 
European parliament  
and of the council of  
20 december 2006 on 
establishing the European 
Globalisation adjustment 
fund (oJ L 406, 30.12.2006, 
p. 1), as amended by 
regulation (Ec) no 546/2009 
of the European parliament 
and of the council of 18 June 
2009 (oJ L 167, 29.6.2009, 
p. 26) — together the ‘EGf 
regulation’. see article 3 
‘Eligible actions’.

2  until 30 May 2009,  
the threshold was  
1 000 redundant workers.

3  articles 1 and 2 of  the 
EGf regulation. the crisis 
criterion effectively only 
applied, under regulation 
(Ec) no 546/2009, from 18 
June 2009 to 31 december 
2011. 

the EGf supports workers made redundant as a result of major structural 
changes in world trade patterns due to globalisation (500 dismissals or 
more2 in one or more enterprises in the Eu) where those redundancies 
have a significant adverse impact on the regional or local economy (the 
‘trade criterion’). in this respect, applicant Member states must dem -
onstrate that the redundancies are linked to a substantial increase of 
imports into the Eu, the rapid decline of the Eu market share in a given 
sector or a delocalisation to third countries.

By way of derogation, from 1 May 2009 to 31 d ecember 2011, the EGf  
was also applicable to workers made redundant as a direct result of the 
global financial and economic crisis (the ‘crisis criterion’)3.

1. 

2. 

3. 

4. 

5. 

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8

6. 

7. 

8. 

for instance, when the effects of the crisis devastated the danish ship -
building industry, there were redundancies as a consequence. i n that 
Member state, the EGf supported redundant workers of the last danish 
shipyard (see Picture 1). another example is the German automotive 
supply industry, which was particularly hit in the regions of Lower saxony 
and north r hine-Westphalia (see Picture 2).

from 9 March 2007 (date of the first application) to 31 d ecember 2012, 
total EGf aid approved amounted to 627 million euro (379 million euro 
from the Eu budget and 247 million euro from the Member states) for 
89 approved applications 4 from a maximum yearly budgetary ceiling 
of  500 million  euro  during  the 2007–13 period.  the  EGf  co-finances 
measures at a rate of 50 % or 65 % 5, with the difference coming from the 
Member state concerned.

the EGf is currently scheduled to run until 31 d ecember 2013. the com-
mission has however proposed continuing with a new EGf regulation 
until 31 d ecember 2020 6.

4  until 31 december 2012, 
Member states introduced 
114 applications, out of 
which 10 were unsuccessful 
(one was rejected by the 
commission and nine 
withdrawn by the applicant 
Member state) and 15 were 
still under the EGf approval 
procedure.

5  under articles 1 and 10 
of the EGf regulation, the 
EGf co-financing rate was 
65 % for all applications 
submitted from 1 May 2009 
to 31 december 2011. Before 
and after that period, the co-
financing rate was 50 %.

6  coM(2011) 608 final of 
6 october 2011.

Picture 1

Picture 2

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One of the halls of the former Odense Steel Shipyard, now “Hall East”,  
a large 12 400 m2 production hall with 900-tonne crane capacity in Lindø 
Industrial Park, Munkebø, Denmark.

Workers at the former Karmann production site in Osnabrück.

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audIt SCopE aNd approaCH

9

9. 

the overall objective of the audit was to assess the contribution made by 
the EGf, in the form of Eu added value, to enabling redundant workers 
to return to the labour market as soon as possible. the court examined 
in particular the following questions.

(a)  did all affected workers benefit from personalised EGf measures, 
and  were  EGf  co-financed  active  labour  market  measures  co -
ordinated with other similar measures (i.e. Esf and Member state 
measures)?

(b)  Was the EGf effective in terms of labour market reintegration?

(c) 

is the nature of the EGf measures likely to deliver Eu added value?

(d)  Was the EGf approval procedure implemented in a timely manner?

10. 

Eight cases in four Member states (two each in d enmark, Germany, i re-
land and Lithuania) in which the EGf was deployed were audited on the 
spot.   they amounted to 67 million euro out of 627 million euro (10,7 %) 
of EGf aid committed until 31 d ecember 2012. the sample of eight cases 
only comprised implemented cases and reflected the different sizes of Eu 
economies, the diversity of the economic sectors affected and important 
differences between the EGf intervention criteria (see Table 1).

tablE 1

oVEr VIEw of audItEd EGf  casEs 1

Member 
State

Germany

Denmark

Ireland

Lithuania

Case name

Case number

Sector

Criterion

Payment month

Nokia

Karmann

EGF/2009/002

Telecommunications

EGF/2009/013

Automotive

Danfoss Group

EGF/2009/015

Mechanics

Odense Steel Shipyard (I)

EGF/2010/025

Shipbuilding

Dell

SR Technics

AB Snaige

EGF/2009/008

Computer appliances

EGF/2009/021

Aeronautics

EGF/2009/010

Domestic appliances

‘Construction’

EGF/2009/017

Construction

Trade

Trade

Crisis

Crisis

Crisis

Crisis

Crisis

Crisis

12/2009

6/2010

11/2010

8/2011

3/2010

12/2010

6/2010

6/2010

1  all the EGf case names mentioned above were strictly assigned by the commission. they are featured on the EGf webpage of the 
commission’s dG Employment, social affairs and inclusion website (http://ec.europa.eu/social/), and also in the EGf statistical portrait 
(2007–11) issued  publicly by the commission. if EGf case names refer directly or indirectly to names of undertakings, the reader should 
not link these undertakings to any statement in this special report or any statement issued by the court and related to this special report. 
the undertakings named are neither EGf beneficiaries, nor managers of the EGf cases audited.

Source: European commission.

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11. 

12. 

13. 

the audit covered the period from 1 January  2007 to 31  december 2012. 
the audit was carried out through interviews, the examination of doc-
uments held by the c ommission and the four audited Member state  
authorities, and an analysis of the data on reintegration rates.the audit in 
the Member states also included the organisation of eight focus group 
meetings at which the various local EGf stakeholders (academics, ad-
ministrations and social partners) could share their views (see Picture 3).

in  addition  to  the  above,  the  results  of  the c ommission’s  mid-term 
evalu ation of the EGf were analysed 7. the mid-term evaluation report 
of december  2011  covered the first 15  cases 8 co-financed by the EGf 
in eight Member states. one of these (nokia, Germany) was included in 
the sample audited on the spot by the court.

7 

‘Mid-term evaluation of 
the European Globalisation 
adjustment fund: final report’, 
submitted by GHK to dG 
Employment, social affairs 
and inclusion, 2011  
(http://.ec.europa.eu/social).

8  BenQ (Germany), nokia 
(Germany), castilla y Leon 
and aragon (spain), catalonia 
(spain), dELpHi (spain), perlos 
(finland), psa suppliers 
(france), Lombardy (italy), 
piedmont (italy), sardinia 
(italy), tuscany (italy), alytaus 
tekstile (Lithuania), textiles 
(Malta), Lisbon-alentejo 
(portugal) and north-centre 
(portugal).

finally, the court carried out a survey by addressing questionnaires to 
Member states (Bulgaria, Estonia, cyprus, Latvia, Luxembourg, Hungary, 
slovakia and the united Kingdom) in order to identify the reasons why 
they did not use the EGf.

Picture 3

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Academics  and experts at a focus group moderated by two ECA auditors on EGF  
support for the Lithuanian construction sector.

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obSErvatIoNS

11

nEarly all workErs wErE  offErEd 
pErsonalIsEd and wEll-coordInatEd 
mEasurEs

in order to demonstrate solidarity with all affected workers, personalised 
measures should be offered not only to the workers made redundant in 
the main enterprise affected, but also to those employed by suppliers 
of that enterprise.

9  some difficulties in 
reaching redundant workers 
of affected suppliers had 
already been identified by 
the mid-term evaluation. see 
mid-term evaluation, p. 100.

in the audited cases nearly all affected workers could benefit from EGf 
measures. no instances of the intentional exclusion of potential benefi-
ciaries were identified.

However in the cases of Karmann and d ell, the court found that an un-
known number of redundant workers formerly employed by the affected 
enterprises’ suppliers were not included in any EGf support measure 9.the 
main reasons for non-inclusion lay in the difficulties faced by Member 
states in assessing which suppliers were affected.

sEr VIcEs wErE  pErsonalIsEd

services offered to the potential beneficiaries were generally tailored 
to their needs and therefore most likely to get results. this positive as-
pect already reported by the mid-term evaluation was confirmed by the 
court’s assessment of the eight EGf cases audited. c oncrete examples 
of personalised services are provided in Box 1.

in ireland, the applications did not always establish the link between 
personalised services and actual labour market needs. as a result, at this 
stage, it was not identified whether the measures put forward were best 
suited to supporting the reintegration of the redundant workers.

14. 

15. 

16. 

17. 

18. 

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10  see article 5 of the 
EGf regulation on the 
coordination information 
required at the application 
stage, and article 6 on 
complementarity and 
coordination.

11  articles 5(3) and 
6(2) of regulation (Ec) 
no 1927/2006.

EGf  mEasurEs wErE  GEnErally wEll-coordInatEd wIth 
natIonal mEasurEs and thE  Esf

in order to maximise the effects of EGf measures, the EGf regulation 
states that they should always take the form of a coordinated package 
of personalised services. What is meant is coordination with measures 
preceding or concomitant to the personalised services co-financed by 
the EGf 10. Member states should also coordinate their interventions with 
the structural f unds11, in particular the Esf.

the c ourt observed that, generally, the Member states effectively co -
ordinated the EGf with Esf and national labour market measures. Exist -
ing Esf measures were usually complemented by additional EGf meas-
ures specifically designed to address workers’ needs.

Moreover,  for  the  eight  audited  cases,  the c ourt  did  not  detect  in-
stances of overlap between the different measures, or double funding 
of individuals.

19. 

20. 

21. 

box 1

thrEE  casEs of packa GEs of pErsonalIsEd sEr VIcEs In IrEland and dEnmark

in the case of dell, the i rish authorities provided child care support and distance learning services. county and 
city enterprise boards delivered special courses for redundant d ell workers (‘start your own business’), as well 
as mentoring to cope with administrative procedures.

in the case of sr technics, some courses, such as aeronautics courses with the i rish aviation authority, had been 
specifically designed. Where relevant courses could not be provided specifically for redundant workers, grants 
were released to allow them to take part in appropriate courses delivered to a larger population (80 % were 
technical courses or aviation industry-related). for the first time ever in i reland, the training and Employment 
authority worked together with the d epartment of d efence and the d epartment of Education and skills to set 
up apprenticeships for civilians.

in d enmark (odense steel shipyard (i)), the EGf facilitated the implementation of high-quality training meas-
ures. these measures were of a more long-term and personalised nature and leading to qualifications superior 
to those which were normally offered to unemployed persons, and the possibility of sectoral reconversion. 
according to several participants in the focus group organised by the auditors, the personalised services went 
well beyond the scope of national personalised measures and were perceived as a unique opportunity, as they 
gave redundant workers ownership of their personal reintegration project.

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22. 

23. 

somE  mEmbEr statEs prEfErrEd thE

 Esf  oVEr thE  EGf

although the Esf is not expected to address unforeseeable events, all 
measures under the EGf regulation may equally be applied under the 
Esf 12. Whether or not the Esf may co-finance support for workers sub -
ject to a mass redundancy caused by an unforeseeable event essentially 
depends on the national eligibility rules and the content of operational 
programmes.

the court’s survey of Member states having never used the EGf interven-
tion concluded that the following were the main reasons for preferring 
the Esf over the EGf :

(a) 

the higher co-financing rate for the Esf (up to  85  %) than for the 
EGf (up to 65 %) is a disincentive to apply for the latter.  this was 
stated by six Member states 13 and had already been recognised by 
the commission in 2010 14.

(b)  the Esf can be implemented more swiftly than the EGf, or national 

administrations are more familiar with the Esf 15.

(c) 

the lack of EGf pre-financing 16.

(d)  the length of the procedure for approving EGf applications 17.

24. 

the more restrictive EGf conditions, in particular the trade criterion, 
are another reason why the Esf is preferred over the EGf . after a mass 
redundancy, some Member states may find it easier to redirect Esf fund-
ing towards support for redundant workers rather than applying for EGf 
funding. for instance, the British authorities never requested EGf assis-
tance in spite of having identified 18 cases that might have qualified for 
such support18.

13

12  answer given on  
19 april 2010 by the 
commissioner for 
Employment and social 
affairs to parliamentary 
question E-1230/2010.

13  Bulgaria, Estonia, cyprus, 
Latvia, Hungary and 
slovakia. the higher national 
contribution was seen as a 
clear impediment to applying 
for the EGf. replies to the Eca 
survey of Member states that 
have not used EGf funding, 
october 2012. see also the 
issues paper concerning the 
permanent changes made 
in 2009 to regulation (Ec) 
no 1927/2006, ‘procedural 
changes’, 25 and 26 January 
2011.

14  answer given on  
19 april 2010 by the 
commissioner for 
Employment and social 
affairs to parliamentary 
question E-1230/2010.

15  Bulgaria, cyprus and 
Hungary.

16  Bulgaria, Estonia, cyprus, 
Latvia, Hungary and slovakia.

17  Mentioned by Estonia, 
Latvia and Hungary. see also 
the issues paper concerning 
the permanent changes 
made in 2009 to regulation 
(Ec) no 1927/2006, 
‘procedural changes’,  
25 and 26 January 2011.

18  according to the 
commission, the united 
Kingdom Esf has been 
redirected towards providing 
training for redundant 
workers after mass 
redundancies.

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rEIntEGratIon Into EmploymEnt of EGf- 
supportEd workErs cannot bE  rElIably 
assEssEd

in order to assess the performance of a  fund it is necessary to moni-
tor and evaluate its results and impacts and to compare them to other 
schemes having similar objectives. taking into account its objective, the 
EGf’s most relevant performance indicator is its capacity to reintegrate 
redundant workers.

the court verified that the reintegration rates calculated as a percentage 
of the reintegrated workers out of the affected workers were available 
for all eight audited cases. Table 2 shows these percentages for different 
standard cut-off periods.

25. 

26. 

tablE 2

rEIntEGratIon ratEs for thE  EIGht audItEd casEs

Nokia

DE

Karmann

Danfoss 

Odense 

DE

DK

DK

Dell

IE

SR Technics

AB Snaige

‘Construction’

IE

LT

LT

Number

%

Number

%

Number

%

Number

%

Number

%

Number

%

Number

%

Number

%

1 337

2 476

1 021

1 358

2 840

1 135

751

1 612

1 305

98 % 1 740

70 %

385

38 %

568

42 % 2 606

92 %

756

67 %

457

61 %

773

48 %

Affected workers,  
of whom:

Participants  
in EGF measures

Cumulative 
reintegration of 
participants:

at the end of the EGF

385

30 %

636

37 %

89

23 %

198

35 %

560

21 %

NA

NA

162

35 %

453

59 %

between 3 and  
12 months after  
the end of the EGF

12 months after  
the end of the EGF

Notes:

627

48 %

NA

NA

NA

NA

NA

NA

1 272

49 %

334

44 %

159

35 %

410

53 %

NA

NA

1 178

68 %

136

35 %

NA

NA

NA

NA

NA

NA

191

42 %

458

59 %

— all data based on Member state data. reintegration data are not precise.
— reintegrated participants are either self-employed or employed in the labour market at the time in question.
— na = number or percentage of workers not available.

Source: Member states.

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19  the EGf was applied for 
on 6 october 2011 and the 
final report would not be due 
before 5 March 2014.

20  odense steel shipyard (i) 
case: this observation was 
confirmed by the court’s 
audit of a sample of individual 
beneficiaries having 
benefited from the EGf. the 
objective was that 25 % of 
the participants should be in 
employment 6 months after 
expiry of the EGf measures. 
that objective was almost 
met 11 months in advance.

21  this observation was 
confirmed by the audit’s 
analysis of a sample of 
individual beneficiaries 
having benefitted from 
the EGf in Germany, as 
well as by an evaluation 
of 16 september 2012 
commissioned by the 
managing authority, p. 4; 
Bundesministerium für arbeit 
und soziales, ‘der Europäische 
Globalisierungsfonds 
in deutschland: Eine 
untersuchung und 
Bewertung seiner umsetzung 
und potenziale’, october 
2012, pp. 2, 9, 10, 72, 88  
(http://www.bmas.de).

27. 

28. 

29. 

30. 

31. 

Whilst reintegration data at the end of the EGf measures were available 
for all employers except in the case of sr technics, data were often not 
available (‘na’) for the other cut-off periods shown in Table 2. i n the case 
of o dense steel shipyard (i), due to the timing of the EGf measures 19, 
there were no data available about the situation of affected workers after 
1 year. a complete overview was possible only for Lithuania.  the table 
shows that the EGf made a certain contribution to the reintegration of 
redundant workers.

in the most successful example (‘construction’ case, Lithuania), 59 % of 
all the redundant workers were reintegrated at the end of the EGf meas-
ures. the lowest rate of reintegration at that stage was 21 % of work -
ers immediately reintegrated after the end of the EGf assistance (d ell 
case, i reland). taking the situation 12  months after the end of the EG f 
measures, the highest reintegration rate reported was 68 % (Karmann 
case, Germany); however, in only four of the eight cases were any data 
available at that stage.

lack of rEIntEGratIon objEctIVEs and spEcIfIc EGf
pErformancE  data

a multiplicity of factors adversely affected the quality and availability 
of reintegration data. firstly, the Member states generally did not set 
quantitative reintegration objectives. out of the eight cases audited only 
one20 included such an element. a s a result, it is not possible to assess 
the measures’ effectiveness in terms of achieving their objectives.

secondly, in Germany, d enmark and i reland, the public or private em-
ployment services, when collecting reintegration data, did not systemat-
ically differentiate between the EGf, the Esf and other national measures 
specifically designed for workers affected by mass redundancies.

for instance, in Germany, the combination of several Esf and EGf-funded 
training modules made it difficult to isolate the impact of individual 
measures, or groups of measures, on reintegration 21. External factors 
(overall  economic  situation,  involvement  of Volkswagen  in  the  case 
of Karmann, employment subsidies) also had an important impact on 
reintegration.

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22  see paragraph 51 of 
special report no 17/2009 
concerning vocational 
training actions for women 
co-financed by the European 
social fund; paragraphs 63 
and 64 of special report 
no 25/2012 ‘are tools in place 
to monitor the effectiveness 
of European social fund 
spending on older workers?’ 
(http://eca.europa.eu).

23  Mid-term evaluation, 
pp. 101–102.

32. 

thirdly, Member state authorities audited generally did not distinguish 
between the two main kinds of EGf measures:

(a) 

active labour market measures such as training, aid for self-employ-
ment, coaching and outplacement;

(b) 

income support paid to workers.

33. 

34. 

35. 

36. 

Whilst this significant distinction was absent in Germany, d enmark and 
ireland, the Lithuanian managing authority went so far as to provide 
reintegration data that distinguished between the workers participating 
in each of the various measures.

in addition, there is no specific information allowing the identification 
of the Esf co-financed projects that could actually have met the EGf 
intervention criteria. this identification would have been useful in order 
to make comparisons between the reintegration rates achieved by funds 
with different budgetary, legal and operational arrangements. in turn, 
this would have contributed towards measuring the impact of the EGf. 
the insufficient quality (inaccuracy, incompleteness and inconsistency) 
of Esf monitoring information available has already been highlighted 
in previous performance audits by the court. i n particular, the commis-
sion does not have consistent and reliable performance data on Eu-
supported targets, and its assessment and supervision are currently not 
oriented towards performance22.

rEIntEGratIon data wErE  dIffIcult to comparE

comparing  reintegration  data  is  a difficult  exercise  under  any  circum-
stances. as stated in the EGf mid-term evaluation, both supply-side (the 
qualifications of redundant workers) and demand-side (local economic and 
labour market conditions) factors influenced the reintegration results23.

However, in the context of the EGf an additional element hampered 
this comparison. this refers to the differences between the timing of the 
EGf and that of other labour market actions, as those workers in greater 
need of help were left to the EGf, which is relatively slower to implement 
(see Box 2 and paragraph 42).

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37. 

38. 

in particular, given that the Esf and EGf both support the training and 
reintegration of the unemployed, such a comparison is necessary with 
respect to sound financial management as it could highlight potential 
structural problems. the example below (Box 2) illustrates this.

the above example shows that timeliness is one of the most important 
criteria when a fund including reintegration objectives aims at some 
degree of success. the nokia case also shows that the EGf and Esf both 
supported the same target group, but for reasons diametrically opposed 
to the purpose for which each fund was designed. the Esf, a structural 
fund, alleviated an emergency; the EGf, an emergency fund, supported 
those whom it was more difficult to reintegrate.

39. 

in fact the EGf and Esf intervene as complementary funds which pro -
vide either long-term strategic help, or act as a one-off time-limited and 
specific response to a single restructuring emergency.

box 2

nokIa’s transfEr companIEs — unEqual pErformancE  owInG  to dIffErEncEs 
In  tImInG

the mobile phone company nokia closed its Bochum (north r hine-Westphalia) site on 30 June 2008.  three 
transfer companies (as they are called under German law) were successively set up to accommodate temporar-
ily redundant workers.

the first transfer company (exclusively supported by Esf funding) was set up in June 2008, 7 months before 
Germany even applied for the EGf. that company yielded a reintegration rate of 66 %.  the third and last transfer 
company was only set up when EGf funding was applied for, in f ebruary 2009; it achieved a reintegration rate 
of 4,35 %.

the nokia case speaks volumes — not because Esf funding performed so much better than the EGf , but be-
cause the Esf proved quicker to mobilise than the EGf and thus delivered better reintegration results. i ndeed, 
the EGf alone had to cater for persons with more difficult cases and who could not be successfully reintegrated 
by the previous transfer companies.

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40. 

41. 

42. 

43. 

GErmany

the managing authority did not consider a comparison between different 
sets of reintegration data to be feasible. as a result, it neither identified 
a comparable statistical population group for the group of EGf benefi-
ciaries, nor made a comparison with overall reintegration rates at federal 
level.

dEnmark

due  to  missing  data,  no  comparison  was  possible  between  the  re -
integration results of EGf project participants and general reintegration 
rates outside the audited cases.

IrEland

surveys conducted by the managing authority concluded that, within 
the same time frame, the employment rate for redundant workers who 
did not benefit from the EGf was higher than the employment rate for 
EGf beneficiaries.  the difference in employment rates can be partially 
explained by the fact that some persons did not finalise training or edu-
cation pathways.

nonetheless, according to the managing authority, a probable cause 
of the EGf ’s lower reintegration rate in i reland would be differences 
between the profiles of redundant workers, the most skilled workers 
finding a job without EGf help.

lIthuanIa

44. 

EGf reintegration results varied significantly from one EGf project to 
another, depending on the measures implemented and the target group 
addressed, which made a straightforward comparison impossible.

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19

24  Eca opinion no 1/2010 
‘improving the financial 
management of the 
European union budget: risks 
and challenges’  
(http://eca.europa.eu).

25  active labour market 
programmes — contains 
all social expenditure (other 
than education) which is 
aimed at the improvement of 
the beneficiaries‘ prospect of 
finding gainful employment 
or to otherwise increase 
their earnings capacity. this 
category includes spending 
on public employment 
services and administration, 
labour market training, 
special programmes for 
youth when in transition from 
school to work, labour market 
programmes to provide 
or promote employment 
for unemployed and other 
persons (excluding young 
and disabled persons) and 
special programmes for the 
disabled (‘an interpretative 
guide to the oEcd social 
expenditure database’, oEcd, 
2007, p. 14).

45. 

46. 

47. 

48. 

thE  c ommIssIon

Monitoring information was only available to the commission in the form 
of the EGf final reports, 6 months after the end of the implementation 
period. However, as a result of the inconsistency and unreliability of the 
reintegration data (see paragraphs 25 to 44), these reports prevent any 
reasonable comparison between different EGf cases, or between the 
measures applied in each case.

in particular, the final reports do not provide an in-depth analysis of the 
nature and the percentage of allowances paid or committed for all the 
EGf cases approved so far. f urthermore, the commission’s database did 
not allow the identification and fund allocation of the individual EGf 
measures nor performance indicators like participation figures or rein-
tegration rates. also, no information is provided on the individual Esf  
or national measures having preceded or complemented the EGf ones.

onE  thIrd of EGf  fundInG  compEnsatEs 
natIonal workErs’ IncomE  support schEmEs, 
wIth no Eu  addEd  ValuE

the Eu added value goes beyond the concept of simple added value. 
it can be defined as the value that an Eu action adds to the value that 
would otherwise have been created by Member states acting alone. i n 
particular, expenditure from the Eu budget must offer clear and visible 
benefits for the Eu and its citizens which, by reason of the scale or effects 
of the proposed action, are better achieved at union level 24.

the c ourt refers in particular to the oEcd definition of active labour 
market programmes. 25 a ccordingly, measures aiming at the improve-
ment of the beneficiaries’ prospect of finding gainful employment or 
otherwise increasing their earnings capacity are qualified as active and 
therefore are considered to meet the conditions for an Eu added value. 
these measures include not only services such as training, aid for self-
employment, coaching and outplacement, but also mobility allowances 
and educational grants, as well as allowances granted in the context of 
the EGf and not ordinarily existing under the Member state’s unemploy-
ment benefit system.

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26  this means all cash 
expenditure compensating 
for unemployment. this 
includes redundancy 
payments out of public 
resources as well as pensions 
to beneficiaries before 
they reach the ‘standard’ 
pensionable age if these 
payments are made because 
they are out of work or 
otherwise for reasons 
of labour market policy 
(‘an interpretative guide to 
the oEcd social expenditure 
database’, oEcd, 2007, p. 15).

27  see mid-term evaluation 
report, 8 december 2011, 
p. 42. produced for the 
commission, the mid-term 
evaluation was based 
on a sample of 15 cases 
approved before the 2009 
amendment to the EGf 
regulation came into force.

By contrast, workers’ income support measures, consisting of unemploy-
ment benefits and programmes for early retirement, cannot be consid-
ered as delivering Eu added value. i ndeed, workers’ income support 
does not represent an ‘active’ labour market measure26 and moreover 
this reduces the share of these measures in the EGf package. i n the mid-
term evaluation, the commission had already reported that on average 
only 26 % of EGf spending consisted of training measures 27.

as can be seen in Table 3 below, a common pattern among the eight 
audited cases is that they included EGf measures to provide income 
support, which would have been paid by the Member states anyway, 
irrespective of EGf intervention. the impact of this type of EGf interven-
tion is to compensate part of the cost of the Member states’ unemploy-
ment benefit system, and there is no added value in such an intervention 
other than Eu additional funding for the Member states.

49. 

50. 

tablE 3

brEakdown of EGf  fundInG  by typE  of pErsonalIsEd mEasurEs In thE  EIGht 
EGf  casEs audItEd

Nokia

Karmann

Danfoss

Odense

Dell

SR Technics

AB Snaige

‘Construction’

DE

DK

IE

LT

Euro

%

Euro

%

Euro

%

Euro

%

Euro

%

Euro

%

Euro

%

Euro

%

1 926 538

20 % 2 324 115

24 % 2 368 478

31 % 6 877 045

33 % 6 596 330

50 % 2 307 271

52 %

70 283

19 %

96 040

9 %

661 139

7 % 1 126 894

12 % 100 256

1 % 1 530 203

7 %

192 412

1 %

24 748

1 %

-

-

-

-

-

-

-

-

-

-

-

-

-

-

-

-

612 081

3 %

-

-

-

-

-

-

-

-

-

-

17 073

5 %

51 426

5 %

136 407

37 % 450 720

43 %

22 159

0 %

7 198

0 %

2 488

0 % 1 369 129

7 % 3 283 375

25 % 586 570

13 %

33 963

9 %

322 552

31 %

-

-

-

-

-

-

-

-

218 090

2 %

27 420

1 %

-

-

661

0 %

s
e
r
u
s
a
e
m
e
v
i
t
c
A

Training/ 
retraining

Job search assis-
tance and general 
information

Employment 
and recruitment 
incentives

Supported 
employment and 
rehabilitation

Entrepreneur-
ship and start-up 
incentives

Other measures

Income support

7 117 315

73 % 6 076 406

64 % 5 294 117

68 % 10 485 906

50 % 2 940 682

22 % 1 464 435

33 % 109 457

30 % 135 123

13 %

Total

9 727 151 100 % 9 534 613 100 % 7 765 339 100 % 20 874 364 100 % 13 230 889 100 % 4 410 444 100 % 367 182

100 % 1 056 480 100 %

Source: Eca, based on available data from dG Employment, social affairs and inclusion and Member state authorities.

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workErs’ IncomE  support mEasurEs rEprEsEnt thE  majorIty 
of thE  co-fundEd ExpEndIturE  for half of thE  casEs audItEd

for each of the cases of the audited sample the c ourt calculated the 
amounts of EGf funding committed to the different types of measures 
and in particular to workers’ income support (see Table 3).

28  see also Table 4.

in six of the eight cases shown in Table  3, the EGf packages included 
a relatively high proportion of income support. i ndeed, in Germany and 
denmark, one case in i reland and one in Lithuania, more than a third of 
the total value of the respective packages of personalised measures was 
composed of income support.

in the particular cases audited in Germany and denmark, training meas-
ures  meant  to  reskill  or  upskill  redundant  workers  represented  only 
a third or less of the respective EGf packages. on the other hand, in-
come support measures in the form of unemployment benefits or the 
equivalent represented 50 % to 73 %. i n those cases, moreover, the link 
between a redundant worker ’s income support and his/her effective 
participation in an EGf-funded labour market measure such as training 
could not systematically be established.

Globally, workErs’ IncomE  support mEasurEs account for 
onE  thIrd of rEfundEd costs

in the absence of a satisfactory EGf database of cases, the c ourt exam-
ined the Member state application data collected by the c ommission 
for each of the 89 EGf cases for which information was available and 
relevant. i t was found (see Table 4) that 33 % of EGf support for workers 
(thus excluding technical assistance to Member states) was composed 
of income support measures such as unemployment benefits.

six Member states have been allocated 29 % of the total EGf co-financing 
and 89 % of all the income support measures approved to date. as well 
as Germany and  denmark, the six included  austria,  italy,  france and 
Malta28.

51. 

52. 

53. 

54. 

55. 

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56. 

the court also notes that the commission’s proposal for the next multi-
annual financial framework seeks to limit EGf support in the form of al-
lowances, which include workers’ income support, to a maximum of 50 % 
of any EGf package 29.

29  article 7(1) of coM(2011) 
608 final.

tablE 4

brEakdown of EGf  fundInG  by typE  of pErsonalIsEd 
mEasurEs and by mEmbEr statEs

Member State

Active measures

Income support

EGF measures

Euro

8 234 726

26 038 835

26 736 900

25 857 836

792 920

59 405 375

353 171

3 273 610

61 810 966

1 637 795

86 027 249

3 956 000

4 036 200

29 242 680

13 739 582

3 783 575

35 500 765

27 864 008

3 325 370

%

23 %

36 %

36 %

42 %

62 %

68 %

74 %

77 %

88 %

92 %

92 %

93 %

93 %

93 %

97 %

98 %

100 %

100 %

100 %

Euro

27 602 090

46 985 923

46 753 250

35 239 500

476 942

27 871 817

121 292

969 200

8 288 900

137 050

7 153 436

310 000

310 000

2 151 000

464 000

94 500

 - 

 - 

 - 

%

77 %

64 %

64 %

58 %

38 %

32 %

26 %

23 %

12 %

8 %

8 %

7 %

7 %

7 %

3 %

2 %

 - 

 - 

 - 

Total

Euro

35 836 816

73 024 758

73 490 150

61 097 336

1 269 862

87 277 192

474 463

4 242 810

70 099 866

1 774 845

93 180 685

4 266 000

4 346 200

31 393 680

14 203 582

3 878 075

35 500 765

27 864 008

3 325 370

Austria

Germany

Italy

France

Malta

Denmark

Czech Republic

Lithuania

Spain

Poland

Ireland

Greece

Romania

Sweden

Portugal

Finland

Netherlands

Belgium

Slovenia

Total

Notes:

421 617 563

67 %

204 928 900

33 %

626 546 463

— all amounts in euro as of 31 december 2012.
— rejected and withdrawn cases have been excluded.

Source: Eca, based on commission data available for 89 approved applications.

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23

30  steiermark case.

31  this rate was a coefficient 
calculated on the basis of 
a telephone survey that was 
conducted for the nokia 
application. the coefficient 
was subsequently applied 
to all other EGf cases in 
Germany.

57. 

58. 

59. 

60. 

61. 

dIffErEnt EGf  co-fundInG  In sImIlar EconomIc cIrcumstancEs

the c ourt  notes  inconsistent  outcomes  in  similar  economic  circum-
stances with respect to workers’ income support measures in the case 
of Germany as compared to austria30, which are the two most intensive 
users of this kind of EGf support.

Germany considered for EGf funding purposes that the duration of the 
training or qualification measures represents slightly less than half of 
workers’ normal working time31. By contrast, austria considered that simi-
lar measures represented 100 % of the normal working time.  this is due 
to the fact that the austrian short-term allowance scheme provides for 
a definition of full-time occupation to be as low as 50 % of the normal 
working time.

as a consequence of these different national decisions, EGf co-funding 
of short-term allowances represented proportionally twice as much in 
austrian cases when compared to German cases. the court notes how-
ever that this difference in the EGf funding decision did not ultimately 
affect the individuals as they received in full the allowances foreseen in 
the national schemes.

thE  EGf  approVal procEdurE  Is too lonG  for 
an EmEr GEncy fund

in order to maximise its impact the EGf should be able to provide its 
financial contribution rapidly in order to allow the affected workers to 
benefit from the funded measures as soon as possible after having been 
made redundant.

after having established the average length of the approval procedure, 
the c ourt assessed to what extent it can be made shorter taking into 
account the different legal provisions and rules to be respected.

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62. 

the EGf approval procedure is the process from the moment a  Member 
state officially applies until the c ommission and the budgetary author-
ity commit the financial contribution to an EGf case. i t can be divided 
into consecutive stages (called later assessment procedure, budgetary 
procedure and empowerment procedure), which last together on aver-
age 41 weeks.

Graph

schEmatIsEd  VIEw of thE  EGf  approVal procEdurE

Assessment procedure

Appraisal and drafting of proposal
and internal consultations procedure

Budgetary procedure

Empowerment procedure

Member State

Applies to

Commission

Submits proposal to

Budgetary authority

Approves EGF support

Commission

Decides to pay

Member State

30 weeks

7 weeks

Total:
41 weeks

4 weeks

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32  paragraph 28 of the 
interinstitutional agreement 
between the European 
parliament, the council 
and the commission on 
budgetary discipline and 
sound financial management, 
2006/c 139/01.

33  see articles 13 to 15 of 
the commission’s rules of 
procedure (c(2000) 3614 
of 8 december 2000), as 
amended by commission 
decision 2010/138/Euratom 
of 24 february 2010 (oJ L 55, 
5.3.2010, p. 60).

63. 

64. 

65. 

66. 

67. 

thE  assEssmEnt procEdurE  could bE  shortEnEd

the assessment procedure is composed of the appraisal procedure and 
the commission’s internal consultation procedures leading to the adop-
tion of the proposal for a decision by the budgetary authority. i t takes 
on average 30 weeks.

the  appraisal  procedure  takes  on  average 15 weeks  when  taking  as 
a starting point the date of the official application of the Member state, 
but it is much longer when taking into account the informal exchange 
of information between the responsible Member state authority and the 
commission.

one of the factors contributing to the length of the appraisal proce -
dure is the possibility foreseen in the EGf regulation to supplement 
Member state applications any time after they officially applied. intro-
ducing a time limit to this possibility as well as taking stock of learning 
curve benefits may reduce the length of time of 15 weeks necessary to 
appraise applications of Member states which are in emergency situa-
tions. the subsequent internal consultations within the commission also 
take 15 weeks on average.

thE  budGE tary and EmpowErmEnt procEdurEs ha VE a furthEr 
Impact on tImElInEss

as the EGf operates outside of the multiannual financial framework, 
each EGf case is subject to a specific budgetary procedure in order to 
make available the related appropriations. in practice, this means that 
once the commission has identified sufficient margins and/or cancelled 
commitments, the decision to deploy them has to be taken by the budg-
etary authority32. this budgetary procedure requires an additional and 
incompressible period of approximately 7 weeks.

the empowerment procedure then completes the approval procedure, 
leading to the adoption of the formal decision to pay a financial contri-
bution. i ts length, an average of 4 weeks, is closely linked to the provi-
sions of the commission’s rules of procedure 33. finally, once agreed, the 
financial contribution is paid to the Member state concerned.

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thE  EGf  approVal procEdurE  Is not tImEly

68. 

to conclude, the approval procedure is very long, especially consider-
ing that the EGf is supposed to be an emergency fund.  in the mid-term 
evaluation report, evaluators already pointed out to the c ommission 
in 2011 that the long EGf approval procedure could be considered too 
slow to offer a genuinely ‘rapid response’ mechanism in times of crisis.

69. 

the length of the entire approval procedure is of an average of 11 weeks 
longer than for an ordinary financing decision of the commission.

70. 

71. 

In thE  End, thE  budGE tary authorIty appro VEd all thE  
projEcts submIttEd by thE  c ommIssIon

the budgetary authority has approved all proposals submitted by the 
commission. only one out of 114 applications has ever been rejected. 
this is probably due to the commission’s very effective support for Mem-
ber states during the application stage. indeed, in all of the eight audited 
cases the c ourt found sufficient evidence of effective support for the 
Member states.

furthermore, not one audited or surveyed Member state authority ex -
pressed dissatisfaction with respect to the commission service respon-
sible for the EGf, but pointed instead to issues concerning the EGf pro -
cedure as a whole rather than the quality of support.

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27

72. 

73. 

74. 

75. 

the c ourt is aware of the need to show Eu solidarity towards workers 
affected by redundancies resulting from changes in world trade patterns. 
However, the court is not convinced that all the features of the current 
EGf mechanism are the most appropriate to deliver specific support with 
Eu added value to redundant workers.

nEarly all ElIGIblE  workErs wErE  offErEd 
pErsonalIsEd and wEll-coordInatEd 
mEasurEs

nearly all eligible workers could benefit from personalised EGf measures. 
However, in some cases redundant workers formerly employed by the 
suppliers of an affected enterprise were not included in EGf support 
(paragraphs 14 to 18).

in  general,  EGf  support  was  well  coordinated  with  Esf  and  national 
labour market measures, in that existing measures were complemented 
by additional EGf measures specifically designed to address workers’ 
needs (paragraphs 19 to 21).

Whereas the Esf is intended to address long-term structural imbalances, 
the EGf was designed to address short-term and ad hoc emergency 
situations. although the Esf is not expected to address unforeseeable 
events, all measures under the EGf regulation may equally be applied 
under the Esf. s ome Member states have preferred to deploy the Esf  
rather than the EGf owing to the higher co-financing rate, quicker im-
plementation and the availability of pre-financing, as well as the lengthy 
approval  procedure  and  more  restrictive  conditions  under  the  EGf 
(paragraphs 22 to 24).

rEIntEGratIon Into EmploymEnt of EGf- 
supportEd workErs cannot bE  rElIably 
assEssEd

76. 

reintegration data exist but are not sufficiently accurate, consistent or 
detailed for any conclusions to be drawn. as a result, no useful compari-
sons or benchmarking could be made between EGf measures within 
an EGf case, between individual EGf cases and between EGf cases and 
other active labour market programmes. no quantitative reintegration 
objectives were set (paragraphs 25 to 46).

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rEcommEndatIon  1

In order to improve the quality of the information on the achievements 
of the different cases and on the effectiveness of measures supporting 
redundant workers, the member States and the Commission should take 
the necessary steps to ensure the availability of up-to-date and reliable 
data in order to monitor the achievement of objectives, as well as to 
compare the outcome of the various measures.

77. 

78. 

onE  thIrd of EGf  fundInG  compEnsatEs 
natIonal workErs’ IncomE  support schEmEs, 
wIth no Eu  addEd  ValuE

When used to co-finance services for redundant workers or allowances 
not ordinarily existing under Member state unemployment benefit sys-
tems, the EGf delivered Eu added value.  this refers in particular to active 
measures aiming at the improvement of the beneficiaries’ prospect of 
finding gainful employment or otherwise increasing their earnings’ ca-
pacity such as training, aid for self-employment, coaching and outplace-
ment, mobility allowances and educational grants (paragraphs 47 to 49).

However, in all the audited cases the court identified measures to pro-
vide workers with income support which would have been paid by the 
Member states anyway. c onsequently, the c ourt considers that only 
training  and  direct  active  support  measures  for  redundant  workers 
have an Eu added value other than additional funding for the Mem-
ber states. sixteen of the 19 Member states which benefited from the 
EGf included income support measures in their packages. i ncome sup-
port measures represented 33 % of the costs refunded for all EGf cases 
(paragraphs 50 to 56).

79. 

the commission did not sufficiently monitor the weight of workers’ sup-
port measures (paragraphs 45 to 46). i n addition, different Member state 
decisions may result in different EGf co-funding for similar income sup -
port measures (paragraphs 57 to 59).

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29

rEcommEndatIon  2

the European parliament, the Council and the Commission should con-
sider limiting Eu funding to measures likely to provide Eu added value, 
rather than funding already existing national workers’ income support 
schemes.

thE  EGf  approVal procEdurE  Is too lonG  for 
an EmEr GEncy fund

the EGf approval procedure is very long.  this has a deterrent effect as 
regards the use of the EGf and consequently hampers Eu solidarity with 
the redundant workers targeted.

in  addition,  the  need  for  a budgetary  procedure  adds  to  the  overall 
length of approval (paragraphs 60 to 69).

80. 

81. 

rEcommEndatIon  3

the European parliament, the Council and the Commission should con-
sider, as an alternative to the EGf scheme, the possibility of adapting 
the ESf framework in order to support more rapidly workers affected 
by mass redundancies.

this r eport was adopted by chamber ii, headed by Mr Harald noacK, 
Member of the court of auditors, on 10 June 2013.

For the Court of Auditors

Vítor Manuel da siLVa ca LdEira
President

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30

rEplY of tHE 
CommISSIoN

executive Summary

i.
since 2006, the EGf has delivered a significant European 
added value towards workers affected by mass redundan-
cies due to major structural changes in world trade pat-
terns resulting from globalisation. i t does so by assisting 
workers, supporting their reintegration into employment, 
business start-ups or targeted training actions. Member 
states  acted  in  accordance  with article  3  of r egulation 
(Ec ) no 1927/2006 (‘Eligible actions’) laying down a variety 
of eligible measures to be co-financed with EGf assistance.

ii.
the EGf and the Esf are complementary policy measures. 
in  line  with  the  principle  of  subsidiarity,  the  mix  of  EGf 
measures designed at Member state level is largely com-
plementary to mainstream Esf provisions to support tran-
sitions back to employment.

iv.
the commission notes that:

(a)
the identification of all affected enterprises and workers 
takes considerable time and effort. as a result, and in order 
to speed up requests, some redundant workers who might 
have  been  eligible  may  not  have  been  included  in  an 
EGf application. However, the c ommission has not been 
informed that any affected workers were ever intentionally 
excluded.

(b)
the decision whether to apply for Esf or EGf funding is 
made at Member state level, on the condition that the Esf  
operational  programme  agreed  with  the  commission  is 
compatible with such contemplated Esf  support. i ndeed 
Esf  operational  programmes  differ  from  one  Member 
state/region to another.

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31

(c) 
Whilst the collection of data can always be improved, the 
commission considers that the EGf has struck a reason-
able cost-benefit balance between the obligations placed 
on  Member states  and  the  quality  and  quantity  of  data 
provided. the c ommission notes that the EGf regulation 
does not require quantitative reintegration objectives. it 
is also important to note that the audited Member states 
respected their reporting obligations as laid down in arti-
cle 15 of the EGf regulation.

common reply to (d) and (e)
the c ommission  considers  that  ver y  few  results  would 
have been achieved without EGf support.  the mid-term 
evaluation report prepared by independent experts also 
confirmed this view.

the measures financed by the EGf should be considered 
as a ‘package’ of interrelated measures, bringing together 
personalised targeted actions and the necessary income 
supports. all together they contribute to the success of the 
operations funded by the EGf.

Moreover,  the  EGf  never  provided  stand-alone  income 
support. from a legal perspective, it should be noted that 
article 3 of r egulation (Ec ) no 1927/2006 includes income 
support,  if  eligibility  requirements  are  met.   i t  does  not 
impose or exclude any minimum or maximum proportions 
of allowances. 

(f ) 
the commission agrees that the current approval process 
is long and therefore strives to minimise delays where pos-
sible whilst ensuring that due process takes place. the fact 
that the EGf operates outside the multiannual framework 
unavoidably influences the timeline of procedures. 

at  present  the c ommission  is  actively  working  to  make 
progress  in  reducing  the  time  necessar y  for  approval 
procedures,for  example  through  the  development  of 
e-applications or stricter deadlines for both Member states 
and the commission in its proposal for the new regulation. 
However, it is important to note that procedures do not 
determine the speed at which support for workers arrives, 
nor does it hamper solidarity.

in fact, the commission stimulates Member states to take 
action at the earliest possible stage when mass redundan-
cies arise. 

v.
recommendations:

(a)
the c ommission accepts the recommendation to ensure 
the availability of up-to-date and reliable monitoring data. 
necessary steps have beentaken with the adoption of the 
commission proposal for the EGf for 2014–20. i t includes 
the  introduction  of  an  interim  report  from  the  Member 
states in order to ensure that quicker, more up-to-date and 
reliable data are available. i t should be noted however that 
this  element  of  the c ommission  proposal  was  not  posi-
tively received in the c ouncil. the c ommission has made 
its proposal whilst aiming to ensure a reasonable cost-ben-
efit balance between the obligations placed on Member 
states and the quality and quantity of data required.

the c ommission furthermore observes that national data 
protection legislation risks hampering the complete imple-
mentation of the recommendation. 

(b)
the commission partially accepts the court recommenda-
tion and has proposed for 2014–20 a ceiling on allowances 
(50 %). this proposal should further improve the efficiency 
and European added value of EGf measures and ensure a 
level playing field between Member states. 

furthermore, over the past 6 years, the c ommission (and 
subsequently the budgetary authority) has only approved 
EGf cases likely to provide added value. 

the conclusions of the mid-term evaluation show that this 
objective was clearly reached.

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Reply of the  CoMMISSIoN(c)
the commission considers that this recommendation has 
already been implemented, as the option to include the 
EGf within the Esf for the period 2014–20 was carefully 
assessed and analysed in the impact assessment and the ex 
ante evaluation for the  commission’s proposal for the new 
EGf regulation.  the European c ouncil and the European 
parliament have agreed in principle on the continuation 
of the fund.

the commission draws attention to the conclusions of the 
mid-term evaluation report. this report concludes that the 
EGf has delivered ‘significant added value’ and ‘independ-
ent experts concluded that hardly any results would have 
been achieved without EGf support’.

it should be noted that expenditure under the EGf is by 
its  nature  unpredictable  whilst  the  Esf  has  been  estab -
lished to address medium- to long-term structural prob-
lems,  which  require  stable  investment  strategies.  the 
commission has therefore considered it better to keep the 
EGf outside the Esf context, and outside the multiannual 
financial framework, allowing in turn the financial flexibil-
ity the EGf requires.

the decision whether to apply for Esf or EGf funding is 
made at Member state level (on the condition that the Esf  
operational  programme  agreed  with  the  commission  is 
compatible with such contemplated Esf support).

32

obServationS

16.
the c ommission  ack nowledges  that  some  redundant 
workers who were eligible may not have been included in 
EGf applications. However, the c ommission has not been 
informed  that any affected workers were ever intentionally 
excluded. s econdly, identifying all enterprises and persons 
concerned takes time and effort. Hence, at some stage the 
Member state may have decided to move ahead with the 
file,  considering  the  cost  (in  terms  of  both  finance  and 
time)  associated  with  finding  any  additional  potentially 
eligible workers to be disproportionate to likely benefits.  
furthermore,  even when not included, affected workers  
might have received other forms of assistance.

18.
Based on the submitted final reports of EGf cases in i re-
land,  the c ommission  considers  that  an  effort  has  been 
made by the Member state to establish the link between 
personalised services and actual labour market needs.

23. (a)
the observation of the court only applies to those Mem-
ber states with higher co-financing rates such as the ones 
listed by the c ourt and cannot be deduced as a general 
rule.

24. 
the c ommission  understands  that  the united  Kingdom 
never applied for EGf funding because of political reasons 
rather than due to reasons connected with the EGf itself.

25.
the c ommission considers that the Eu level is the most 
appropriate level for dealing with the impact of changes 
in world trade patterns. i n the light of this political view, it 
follows that Eu assistance should be provided to those suf-
fering from the impact of globalisation. such EGf support  
has  a  strong  European  added  value. the  question  then 
becomes whether the clear value added is also expressed 
through effective action. i n that respect the c ommission 
underlines that the effectiveness of the EGf can also be 
assessed  by  the  number  of  beneficiaries  who  upgraded 
their competences and vocational skills, thus improving 
their employability in the labour market.

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Reply of the  CoMMISSIoN33

27.
comparisons with international data sources, and in par-
ticular with Eurostat data, suggest that integration rates 
are satisfactory despite the very difficult context. table 2 
shows that, on average, 34 % of all participants in the cases 
audited by the court had already been reintegrated by the 
end of the EGf assistance, almost 46  % between 3 and 12 
months after the end of the EGf assistance and over 51  % 
of persons reintegrated 12 months after the end of the EGf 
assistance. 

the main conclusions of the mid-term evaluation report on 
the EGf between 2007 and april 2009 indicated an aver -
age  re-employment  rate  of  42  %  among  affected  work-
ers immediately after the end of the EGf implementation 
period across the 15 EGf cases evaluated.  this can be con-
sidered as a very good result. 

Eurostat data on labour transition from unemployment to 
employment in 2010 show a rate of 28,7 % for the Eu. in 
that light a reintegration rate of 42 % compares favourably. 

the  repor ting  requirements  for  the  Member states  are 
those in accordance with article 15 of the EGf regulation 
and the relevant financing decisions. they have been com-
plied with by the Member states when providing their final 
reports of the eight cases audited.  all additional data are 
therefore gathered on a voluntary basis by Member states. 

29.
the c ommission notes that the EGf regulation does not 
include quantitative reintegration objectives and recalls 
that  the  var ious  EGf  measures  can  also  be  assessed 
through  other  indicators  and  by  other  means  (such  as 
evaluations). for the period 2014–20, the commission has 
proposed a reintegration objective of 50 % after 12 months 
of implementation.

31.
the commission underlines that the EGf and Esf are funds 
supporting complementary policy measures dealing with 
the labour market consequences of globalisation. i n line 
with the principle of subsidiarity, the mix of EGf measures 
is designed at Member state level and is often similar to 
mainstream Esf provisions to support transitions back into 
employment.

32.
income  suppor t  was  never  provided  as  a  stand-alone 
measure. in line with the EGf regulation, it was always part 
of a package combined with active labour market policy 
measures  which  achieve  the  positive  effects  confirmed 
by the mid-term evaluation and many final reports of EGf 
cases.

Member states acted in accordance with article 3 of r egu-
lation (Ec ) no 1927/2006 (‘Eligible actions’) when design-
ing the relevant package of personalised EGf measures. 
during the implementation period, this package of meas-
ures is carried out with EGf assistance.   these include gen-
eral job search assistance, training, job search allowances, 
training allowances, support for entrepreneurship, geo-
graphical mobility and employment subsidies.

34.
the purpose of Esf monitoring data is not to identify tens 
of thousands of (potential) Esf projects supported through 
the current 117 Esf operational programmes (2007–13). 
instead, the remit of this monitoring is to collect statistics 
on  the  implementation  of  programmes  through  finan-
cial data (broken down by priorities as defined in the Esf 
regulation) and data on the number of persons supported 
(including breakdowns by gender, educational attainment, 
etc.). 

as regards the quality of Esf monitoring data, the c ommis-
sion notes that:

(a) 

the quality of indicators is constantly improving;

(b)  the commission takes action in monitoring committee meet-

ings when it considers the result indicators are insufficient;

(c) 

the commission checks how actions meet their targets on the 
basis of all information received and through ex post evaluation.

for  the  period  2014–20,  the c ommission  has  proposed 
mandatory output and result indicators.

36.
the  EGf  financing  is  to  allow  Member  states  to  take 
actions on the ground after they have spent the amount 
set  aside  for  co-financing;  it  does  not  determine  their 
speed  of  implementation,  nor  should  it  influence  the 
speed with which these actions are initiated.

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Reply of the  CoMMISSIoN34

it is the Member states’ responsibility to ensure that the 
right  assistance  reaches  their    unemployed  workers  as 
soon as possible. Late adoption of financing decisions for 
actions that should be (pre-) financed nationally should 
not  be  seen  as  an  obstacle  to  enhancing  the  speed  of 
implementation.

38.
the EGf and Esf are complementary funds which provide 
either long-term strategic help or act as a one-off time-
limited  and  specific  response  to  a  single  restructuring 
‘emergency’. i f the EGf funds come in, for specific reasons 
valid in this case, later than other support funds, the EGf 
objective is nevertheless met.

it  must  be  noted  that  it  is  up  to  each  Member state  to 
manage the complementarity between the Esf and EGf in 
the best possible manner given the local conditions pre-
vailing at the time.

43.
in this global context, it should be noted that the commis-
sion cannot be aware at this stage of the possible impact 
of differences in the overall affected population and their 
respective employability.

45.
the c ommission notes that in general the reintegration 
data provided in the final reports of Member states is con-
sistent and reliable. When the analysis of the commission 
shows discrepencies, immediate action is taken.

the  final  EGf  repor ts  have  a  predefined  standard  for -
mat, allowing an effective comparison of EGf-supported 
cases. the (audited) Member states have respected their 
reporting obligations as laid down in article 15 of the EGf  
regulation. 

at the same time, the commission considers that within 
the EGf, a reasonable cost-benefit balance has been struck 
when reviewing the obligations placed on Member states 
in terms of monitoring, reporting and evaluation and the 
quality and quantity of data provided. 

46.
the c ommission has carefully examined all final reports 
and, when necessary, taken further action. all important 
data are being recorded in the EGf  database, allowing the 
commission to monitor and report. 

regarding the nature and the percentage of allowances 
paid or committed for EGf cases, the situation is as follows. 

on  the  basis  of  applications,  the c ommission  has  an 
expectation as regards the share of allowances in the final 
total  expenditure  of  a  project. then,  upon  reception  of 
the final report, the commission is informed of the actual 
expenditure. 

Both  sources  are  used  for  the  database,  allowing  the 
extraction  of  in-depth  information. i t  should  be  noted 
that final reports, by their very nature, become available 
6  months  after  the  end  of  the  implementation  period. 
Hence, final data are not yet available for all cases, since for 
many cases implementation is ongoing.   

the commission is improving the monitoring of all support 
measures by further developing its database and providing 
for an interim report to be presented by Member s tates in 
its proposal for the EGf regulation for 2014–20.

47.
the c ommission considers that the Eu level is the most 
appropriate level for dealing with the impact of changes in 
world trade patterns. Based on that political view, it follows 
that Eu assistance should be provided to those suffering 
from the impact of globalisation. 

the conclusions of the mid-term evaluation final report 
(GHK, 2011) indicate that the EGf has delivered ‘significant 
added value’. furthermore, it also notes that ‘independent 
experts concluded that hardly any results would have been 
achieved without EGf support’.

48.
the EGf co-finances, on the basis of  article 3, integrated 
support packages to workers, including allowances in rela-
tion to job search and mobility or allowances to individuals 
in lifelong learning and training activities.

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Reply of the  CoMMISSIoN35

rEplY of tHE  
CommISSIoN

52.
article 3 of the EGf regulation does not exclude income 
support, provided that the support is an integral part of 
the package which includes, for example, training, men-
toring, support for micro-business start-up, etc. Moreover, 
article 3 does not impose or exclude any minimum or max-
imum proportions of allowances.

53.
the c ommission  does  not  share  the c ourt’s  criticism  as 
training and income support should be viewed as a pack-
age. the c ommission recalls that the current EGf regula-
tion prohibits the co-funding of passive measures. 

common reply to paragraphs 54–56.
the commission observes that the current EGf regulation 
prohibits the co-funding of passive measures, but does not 
place a ceiling on allowances within a package of person-
alised measures. such a ceiling has been proposed for the 
future EGf regulation (2014–20), where it is to be set at 
50  %. the reason for the proposed change is to reinforce 
the  efficiency  of  EGf  measures  and  to  level  the  playing 
field between Member states. 

in  addition,  as  noted  for  paragraph  46,  the c ommission 
does have a database in which relevant data and statistics 
provided through the submission of cases as well as those 
provided through the EGf final reports are available.

common reply to paragraphs 57–59.
the commission considers that both Member s tates were 
treated in a consistent and equal manner. 

the EGf is administered in shared management. therefore, 
the c ommission needs to rely on the information made 
available by the Member states. i t analyses this informa-
tion and bases its actions on that assessment, and in addi-
tion it audits the EGf cases according to its risk assessment 
criteria.

With regard to the two Member states cited by the c ourt, 
Germany provided detailed information about the system 
of allowances through a study, and as a result self-imposed 
a limitation on the support for allowances. the commission, 
based  on  its  assessment,  accepted  the  outcome  of  this 
study.  upon request by the c ommission, austria presented 
information on its system of allowances. the commission 
made the same type of analysis of the information provided 
by austria, and had no basis for rejecting it.

furthermore, the Eurostat labour market policy database 
methodology states (in line with the oEcd definition) that 
the  unemployment  benefits  received  by  participants  in 
labour market policy measures (instead of receiving train-
ing allowances, wages or similar) should be included as 
part  of  the  expenditure  for  that  measure  and  excluded 
from the amounts reported as unemployment benefits.

49.
the commission does not wish to place undue em phasis 
on training measures, which are only one part of the pack-
age  of  eligible  measures  put  together  by  the  Member 
states. i n addition, there is education, enterprise creation, 
career advice and counselling, internships, mentoring in a 
new job, peer group interaction and much more.

50.
the  legislator  considered  it  important  for  the  European 
union  to  provide  suppor t  to  workers  made  redundant 
when trade shifts or  — for a limited period — the global 
financial  and  economic  crisis  have  adverse  effects  on 
employment. this Eu  solidarity with the affected workers 
and the Member states should be considered in a broader 
context in which there is a visible relation between the Eu 
role in trade negotiations on a global scale or the effects of 
the global financial and economic crisis and the Eu taking 
its (social) responsibility when this has locally or regionally 
important adverse effects. 

in that context, the commission considers it important to 
provide the option of taking on the full cost and to treat 
all Member s tates equally. i n financing allowances which 
would otherwise have been paid by a Member state, that  
Member state can receive  the same level of support as 
a Member state where such allowances do not exist.  not 
following such a line would have implied treating various 
Member states differently. 

the support provided by the EGf should be considered as 
a ‘package’, which is larger and more effective than the sum 
of its parts. all agreed allowances should be considered as 
part of this package, and can be judged on the basis of the 
overall success of each individual worker’s package (deci-
sion for support) i.e. how many of the targeted workers 
find new employment.

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36

common reply to paragraphs 60–62. 
Member states are entitled and encouraged to start imple -
menting their planned measures as soon as they are ready 
and as early as possible, so that workers do not need to 
wait for the care to which they are entitled. they should 
clearly do so before the final approval by the budgetary 
authority of an application comes through. i n other words, 
the fact that approval takes time should not impact a rea-
sonably fast response ‘on the ground’. 

depending  on  the  type  of  EGf  case  ( article  2(a)  or  (b)), 
Member s tates  have  a  4-month  or  9-month  reference 
period during which the redundancies occur. this is fol-
lowed by a 10-week period (article 5 of the EGf regula-
tion) during which Member states finalise their applica-
tions. Member states make contact with the c ommission 
during both of these periods, and often already before the 
reference period, in cases where a large undertaking has 
announced future redundancies that could potentially be 
eligible for EGf assistance. 

all  these  contacts  revolve  around  the  application  form 
and the necessary data to complete it. Each EGf case was 
treated on its own merits, and Member states were given 
the opportunity to provide further information after having 
submitted their applications, until the commission had all 
the data at its disposal enabling it to argue the eligibility 
of the case in front of the council and the European parlia-
ment. the commission has never yet rejected an EGf appli-
cation on the grounds of insufficient information having 
been supplied by the applicant Member state.

65. 
the commission strives to minimise delays where possible 
whilst ensuring due process takes place. 

the time required to adopt an EGf financing decision does 
not block Member states from taking action. 

When considering the length of the appraisal procedure, 
the c ommission has proposed for 2014–20 a deadline for 
Member states’  additional  information,  and  a  condition 
that such additional information should be provided only 
in exceptional cases. also, learning curve effects have been 
visible for some time, allowing a somewhat faster process. 
all targeted changes together, including e-applications, 
should allow an important speeding up of the length of 
the  assessment  and  subsequent  adoption  of  financing 
decisions.

67.
the major part of the preparation of the financing deci-
sion is concurrent with the budgetary procedure, so that 
only the adoption by empowerment takes place after the 
decision of the budgetary authority has been signed. the 4 
weeks mentioned by the court include both the adoption 
of the financing decision by empowerment, and the actual 
commitment and payment of the contribution.

68.
the commission refers to its reply under paragraphs 60 to 62.

69.
EGf procedures, for the reasons referred to in paragraphs 
65 and 67, exceed the level of complexity associated with 
ordinary  financing  decisions  of  the c ommission. a s  the 
court notes (paragraph 66), important parts of the pro-
cedure cannot be compressed. the commission has been 
striving to  speed up the entire approval process and is 
therefore actively working on further ways by which the 
overall  timeline  can  be  shortened,  for  example  through 
the development of e-applications or stricter deadlines for 
both Member states and the c ommission in its proposal 
for the new regulation.

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Reply of the  CoMMISSIoNconcluSionS and recommendationS

72.
the commission draws attention to the conclusions of the 
mid-term evaluation report related to added value. this 
report  concludes  that  the  EGf  has  delivered ‘significant 
added  value’  and ‘independent  experts  concluded  that 
hardly any results would have been achieved without EGf 
support’.

73.
the c ommission strives, with Member states, to achieve 
a reasonable balance between a comprehensive coverage 
and the time necessary to prepare and submit an applica-
tion. i t underlines that the affected workers of the down-
stream suppliers have never been intentionally excluded. 
also, even when not included, they might have received 
other forms of assistance.

75.
the commission agrees that the EGf and Esf are mutually 
complementary policy measures  in supporting the tran-
sition  of  redundant  workers  back  into  employment  and  
notes that the c ourt lists seven out of 27 Member states 
that preferred the Esf over the EGf (paragraphs 23 and 24). 
the c ommission also refers to its reply to r ecommenda-
tion no 3 of the c ourt.

76.
the commission notes that, in general, it has accurate and 
detailed reintegration data at its disposal for all EGf cases. 
With regards to the level of detail of such data, in all of the 
EGf cases audited, the Member states complied with their 
reporting obligations in accordance with article 15 of the 
EGf regulation. 

Moreover, the commission underlines that reintegration 
objectives were not included in the EGf regulation. 

in its proposal for the new EGf regulation for 2014–20, the 
commission proposed as an objective to be obtained that 
50  % of workers are reintegrated into employment 1 year 
after the date of application.

37

rEplY of tHE  
CommISSIoN

recommendation 1
the c ommission accepts the recommendation to ensure 
the availability of up-to-date and reliable monitoring data. 
necessary steps have been initiated with the c ommission’s 
proposal for the EGf for 2014–20. i t includes the introduc-
tion of an interim report from the Member states in order 
to ensure that quicker, more up-to-date and reliable data 
are available. 

it should be noted however that this element of the com-
mission proposal was not positively received in the c oun-
cil. the c ommission has made its proposal whilst aiming 
to ensure a reasonable cost-benefit balance between the 
obligations placed on Member states and the quality and 
quantity of data required.

the c ommission furthermore observes that national data 
protection legislation risks hampering the complete imple-
mentation of the recommendation. 

77.
the c ommission  treats  all  M ember states  equally  in 
respect of their EGf cases. i t does not provide more or less 
support to a Member state depending on how generous 
a  social  support  system  in  place  is. treating  all  Member 
states equally was considered to be a fundamental aspect 
of the EGf by the legislator. 

furthermore, an important dimension of the EGf is the link 
with the negative aspects globalisation may have in this 
context locally/regionally. the Eu dimension provides in 
that context full support and represents a key added value.

78.
the c ommission refers to its replies to paragraphs 48 to 
52. the commission observes that support provided by the 
EGf should be considered as financing a ‘package’ of inter -
related measures, which as a whole contribute to the suc-
cess of the funded operations.

indeed the EGf provides support to workers through vari-
ous forms of assistance, including allowances to ensure 
that workers have sufficient income for the duration of the 
activation measures, and are hence in a position to benefit 
from the various supported actions such as training.

Special report No 7/2013 – Has the European Globalisation adjustment fund delivered Eu added value in reintegrating redundant workers?
Special report No 7/2013 – Has the European Globalisation adjustment fund delivered Eu added value in reintegrating redundant workers?

Reply of the  CoMMISSIoN38

the  EGf  regulation  does  not  set  conditions  or  specify 
a preference  for  the  source  of  such  allowances,  nor  do  
evaluations  and  assessments  show  any  differentiation 
in  terms  of  effectiveness  or  per formance  related  to  the 
source or type of allowances for workers while following 
training courses (or other actions) with a view to finding 
new employment. 

79.
the commission is improving the monitoring of all support 
measures by further developing its database and providing 
for an interim report to be presented by Member s tates in 
its proposal for the EGf regulation for 2014–20.

the c ommission  considers  that  all  Member states  are 
treated in a consistent and equal manner and refers to its 
reply in paragraphs 57 to 59.

recommendation 2
the commission partially accepts the court recommenda-
tion and has proposed for 2014–20 a ceiling on allowances 
(50 %). this proposal should further improve the efficiency 
and European added value of EGf measures and ensure a 
level playing field between Member states. 

furthermore, over the past 6 years, the c ommission (and 
subsequently the budgetary authority) has only approved 
EGf cases likely to provide added value. 

the conclusions of the mid-term evaluation show that this 
objective was clearly reached.

it is important to note that each EGf case was treated on 
its own merits, and Member states were given the oppor -
tunity to supplement their applications with further infor-
mation, until the c ommission had all the data at its dis-
posal that would enable it to argue the eligibility of the 
case in front of the council and the European parliament.

as a result of the full process a high success rate of EGf 
applications could be obtained. 

81.
the EGf operates outside the multiannual financial frame -
work  (Mff),  which  requires  that  each  EG f  case  must  be 
presented individually to the c ouncil and the European 
parliament.

recommendation 3
the commission considers that this recommendation has 
already been implemented, as the option to include the 
EGf within the Esf for the period 2014–20 was carefully 
assessed and analysed in the impact assessment and the ex 
ante evaluation for the  commission’s proposal for the new 
EGf for 2007–11.  the European council and the European 
parliament have agreed in principle on the continuation 
of the fund.

the commission draws attention to the conclusions of the 
mid-term evaluation report. this report concludes that the 
EGf has delivered ‘significant added value’ and ‘independ-
ent experts concluded that hardly any results would have 
been achieved without EGf support’.

80.
the commission agrees that the current approval process 
is long and therefore strives to minimise delays where pos-
sible whilst ensuring that due process takes place. a t pre-
sent the commission is actively working to make progress 
in this respect. However, it is important to note that pro-
cedures do not determine the speed at which support for 
workers arrives, nor does it hamper solidarity.

it should be noted that expenditure under the EGf is by 
its  nature  unpredictable  whilst  the  Esf  has  been  estab -
lished to address medium- to long-term structural prob-
lems,  which  require  stable  investment  strategies.  the 
commission has therefore considered it better to keep the 
EGf outside the Esf context, and outside the multiannual 
financial framework, allowing in turn the financial flexibil-
ity the EGf requires.

in fact, the commission stimulates Member states to take 
action at the earliest possible stage. 

the decision whether to apply for Esf or EGf funding is 
made at Member state level (on the condition that the Esf  
operational  programme  agreed  with  the  commission  is 
compatible with such contemplated Esf support).

Special report No 7/2013 – Has the European Globalisation adjustment fund delivered Eu added value in reintegrating redundant workers?

Reply of the  CoMMISSIoNEuropean Court of auditors

Special report no 7/2013
has the european Globalisation adjustment Fund delivered eu added value in reintegrating redundant workers? 

luxembourg: publications office of the European union

2013 — 38 pp. — 21 × 29.7 cm

ISbN 978-92-9241-314-9
doi:10.2865/92721

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tHE  EuropEaN  C ourt  of   audItorS  aSSESSEd   tHE  C oNtrIbutIoN 

madE b Y  tHE  EuropEaN  GlobalISatIoN adjuStmENt

 fuNd   (EGf),  IN 

tHE form  of  Eu  addEd  valuE, to ENablING rEduNdaNt  workErS  to 

rE turN  to tHE labour  markE t. wHIlE NEarl Y all  ElIGIblE  workErS 

wErE  offErEd   pErSoNalISEd   mEaSurES,  IN  all   audItEd   CaSES 

tHE  C ourt  IdENtIfIEd   INComE  Support   mEaSurES  wHICH  would 

HavE  bEEN  paId   b Y  tHE  mEmbEr   StatES  aNY waY.  tHE  audIt   alSo  

CoNludEd   tHat   rEINtEGratIoN  data   wErE  INSuffICIENt   aNd   tHat  

tHE  approval  proCEdurE for  tHE EGf  Support  IS too loNG. 

EuropEaN  C ourt of audItorS