EC: Barcelona Council adds to Lisbon and Stockholm goals
This year's annual spring Council was held in Barcelona, under the Spanish Presidency of the Council of Ministers. The Council reviewed the achievements of member states' employment policy to date and set about encouraging the attainment of the longer-term goals set at the Lisbon and Stockholm Councils in the past two years.
Amid the scenes of violence that have lately characterised international meetings, European ministers and heads of state gathered in Barcelona on 15-16 March 2002 for the annual spring Council. These annual meetings focus on economic, social and environmental issues in the European Union. This is the third such annual summit to be held, following the Lisbon summit of March 2000 and the Stockholm summit of March 2001. Employment targets set at the Lisbon and Stockholm summits (see box below) have provided a framework for the European employment strategy.
General assessment of progress
In general, the Council notes that much progress has been made towards achieving the employment targets set by the Lisbon and Stockholm Councils. Unemployment has fallen steadily in EU member states over the past few years (see table below), due partly to robust economic growth, which the active labour market policies encouraged by the European strategy have exploited to the full. In addition, the Council notes that member states have also been successful in reducing the tax burden on labour, particularly in the low-wage areas of the economy.
However, it also notes that progress has been too slow in a number of areas, specifically:
- reform of benefit systems in order to provide an incentive to work;
- wage formation systems that keep pay to levels in line with inflation and productivity growth;
- labour market efficiency (unemployment often co-exists with skills shortages);
- active ageing policies, which seek to encourage older workers to remain in the labour market;
- female participation rates; and
- the regulation of employment, particularly with a view to striking the right balance between flexibility and security.
Reinforcing the European social model
The Council characterises the European social model as a system based on good economic performance, a high level of social protection and education, and social dialogue. Keeping the emphasis on active labour market policies, it states that an active welfare state should encourage people to work "as employment is the best guarantee against social exclusion". In order to achieve the targets set at Lisbon and Stockholm, the Council highlights two principles that, in its view, need to be reinforced:
- increasing the involvement of workers in changes affecting them. The Council calls on the social partners to find ways of managing corporate restructuring through dialogue and a preventative approach. The European Commission launched the first stage of social partner consultations at EU level on this issue in January 2002; and
- enhancing the qualitative aspects of work, and, in particular, the health and safety dimension. The Council notes that the Commission has prepared a communication on a Community health and safety strategy (Commission: New health and safety strategy), which the Council has been invited to examine.
Other issues examined by the Council in broad terms include the fight against poverty and social exclusion - member states are invited to set targets in their national action plans for employment (NAPs) to "significantly" reduce, by 2010, the number of people at risk of poverty and social exclusion, although the Council does not set any concrete targets here.
The Council has also debated the problem of an ageing population, calling for pension system reforms to be accelerated, to ensure that they are financially sustainable and meet their social objectives. The Commission has been looking at the issue of European pension systems in some detail over the past few years. Most recently, in April 2001, it issued a communication on the elimination of tax obstacles to the cross-border provision of occupational pensions. Further, a pensions coordination strategy, based on the method of open coordination (an annual cycle of guidelines, national action plans, assessment and recommendations for improvement) was launched by the Commission in July 2001.
Priority action
The Council goes on to list a number of areas in which action is considered to be a priority. It states that full employment, which is at the heart of the Lisbon strategy, requires the creation of more and better jobs. In order to achieve this, it suggests a number of changes to the Luxembourg employment strategy as follows:
- simplification of the strategy, by reducing the number of guidelines, but without undermining their effectiveness;
- alignment of the time frame with the deadlines of 2010 set at Lisbon, including an intermediate evaluation in 2006 in order to assess achievement of the intermediate targets (to be achieved in 2005) set in Stockholm; and
- reinforcement of the role and responsibility of the social partners in the implementation and monitoring of the guidelines.
The Council stresses that the employment strategy should "focus on raising the employment rate by promoting employability and removing obstacles and disincentives to take up or remain in a job, while preserving the high protection standards of the European social model". It also emphasises that a strong interaction between the social partners and public authorities is needed "and in particular a priority focus on lifelong learning, quality of work and gender equality".
The Council has specific advice for member states when formulating and implementing their current national employment policies:
- give priority, in terms of tax cuts, to reducing the tax burden on low-wage earners;
- adapt tax and benefit systems to make work pay and encourage people to enter the labour market;
- take into account the relationship between wage developments and labour market conditions, thereby allowing evolution of pay according to productivity developments and skills differentials;
- review the regulations governing employment contracts in order to promote more jobs and to strike a proper balance between flexibility and security;
- remove disincentives for female labour force participation and aim, by 2010, to provide childcare for at least 90% of children between the age of three and the mandatory school age, and at least 33% of children under three; and
- reduce early retirement incentives for individuals and limit the introduction of early retirement schemes. Conversely, there should be greater effort to increase opportunities for older workers to remain in the labour market. Most concretely, there should be a progressive increase of around five years in the effective average age at which people stop working in the EU by 2010. Progress towards this goal will be analysed each year in advance of each future spring Council.
Skills and mobility
The Council welcomes the Commission's recently launched action plan on skills and mobility in the EU (Commission: New labour market action plan), which aims to remove barriers within European labour markets by 2005, and calls on the Council to take the necessary steps to put into practice the measures proposed in the action plan. Priority will be given to the following areas:
- putting into place the legal conditions required to ensure genuine mobility for all those involved in education, research and training;
- lowering regulatory and administrative barriers to professional recognition as well as the barriers that result from a failure to recognise formal qualifications. Further, non-formal learning should be taken into account;
- ensuring that all EU citizens are well equipped with basic qualifications, particularly in the information and communications technology areas. There should be a particular focus on unemployed women; and
- increasing (where appropriate) the transferability of social security rights, including pensions, across the EU. In particular, the Council is keen for the reform of Regulation No 1408/71 to be completed so that a new Regulation can be adopted before the end of 2003.
In terms of concrete action in this area, the Council states that:
- a European Health Insurance Card will replace the current forms needed for health treatment in another EU member state. The Commission will present a proposal for this before the 2003 spring Council; and
- the one-stop European job mobility information website, as proposed in the action plan, will be launched and become fully operational by the end of 2003.
Further, the Council welcomed the adoption by the EU-level social partners, at a social summit held prior to the Council, on a joint framework for action for the lifelong development of competencies and qualifications (see box below).
Conclusions
The Barcelona Council has not introduced any radical changes into the Lisbon strategy and the Luxembourg employment strategy, which will continue as they have done for the past few years. Rather, this latest Council has focused on areas perceived to have been neglected and on ways to ensure that the concrete employment targets set at Lisbon and Stockholm can be achieved - after all, the date for the achievement of the Stockholm intermediate targets - January 2005 - is not so very far away.
The main challenges for labour-market policy in the EU over the coming years include how to cope with reduced levels of economic growth after the robust growth seen at the end of the 1990s and in 2000. A further key challenge will be how to deal with issues such as skills mismatches and a population that is ageing and still shows a penchant for retiring early whenever possible.
Unemployment in the EU, % of workforce in December 2001 and 2000, seasonally adjusted
|
Country |
2001 |
2000 |
|
Eurozone |
8.5 |
8.7 |
|
EU15 |
7.8 |
8.1 |
|
Austria |
4.2 |
3.3 |
|
Belgium |
6.9 |
8.3 |
|
Denmark |
4.4 |
4.9 |
|
Finland |
9.1 |
9.3 |
|
France |
9.3 |
10.5 |
|
Germany |
8.0 |
8.1 |
|
Ireland |
4.2 |
4.1 |
|
Italy |
9.3 (October 2001) |
9.9 |
|
Netherlands |
2.2 (November 2001) |
2.8 |
|
Portugal |
4.3 |
4.3 |
|
Spain |
12.9 |
13.7 |
|
Sweden |
5.0 |
5.1 |
|
UK |
5.2 (October 2001) |
5.2 |
|
Source: Eurostat. |
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