16 Reducing exclusion from employment
| (27292)
6239/06
COM(06) 44
| Commission Communication: consultation on action at EU level to promote the active inclusion of people furthest from the labour market
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| Legal base | — |
| Document originated | 8 February 2006
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| Deposited in Parliament | 14 February 2006
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| Department | Work and Pensions
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| Basis of consideration | EM of 27 February 2006
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| Previous Committee Report | None
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| To be discussed in Council | No date set
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| Committee's assessment | Politically important
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| Committee's decision | Cleared
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Legal background
16.1 Article 136 of the EC Treaty provides that the Community
and Member States:
"shall have as their objectives the promotion of employment,
improved living and working conditions, so as to make possible
their harmonisation while the improvement is being maintained,
proper social protection, dialogue between management and labour,
the development of human resources with a view to lasting high
employment and the combating of exclusion".
16.2 Article 137 provides that, with the aim of achieving the
objectives of Article 136, the Community should support the activities
of the Member States in (among other things) the integration of
people excluded from the labour market, resisting social exclusion
and modernising "social protection systems" (that it,
social security, health care and social care systems).
16.3 Article 138(1) gives the Commission responsibility
for promoting consultation between management and labour at Community
level. Article 138(2) requires the Commission to consult management
and labour before making proposals on social policy.
Policy background
16.4 In 1992, the Council adopted two Recommendations
on establishing the common objective that each Member State's
social protection system should provide sufficient resources and
benefits.[49]
16.5 In 1999, the Commission issued a report which
concluded that the Recommendations had encouraged discussions
between Member States about Minimum Income schemes and fostered
the convergence of their schemes.[50]
16.6 The Community's Employment Guidelines for 2005-08
call on Member States to reduce exclusion from employment by,
for example, helping people to search for jobs or obtain child
care.
16.7 A year ago, the Commission presented its proposals
for the Community's Social Agenda for the next five years.[51]
The proposed Agenda included an outline of measures to promote
full employment and improve social cohesion. It said that the
Commission would begin consultations on why Member States' existing
Minimum Income schemes are not sufficiently effective. In a letter
of 7 April 2005, the then Parliamentary Under-Secretary of State
for Work and Pensions (Mr Chris Pond) told the previous Committee
that:
"the Government would not welcome any attempt
to introduce EU-wide minimum income levels and/or any EU regulation
on minimum income in or out of work. The UK supports an approach
to achieving inclusion by improving through access to work, and
would want to ensure that Member States can set minimum incomes
in line with their national conditions."
The document
16.8 The Commission's Communication has two purposes:
- to review the Community's progress
towards fostering access to the labour market for those who are
excluded; and
- to initiate public consultations under Article
138(2) of the EC treaty on possible guidelines for EC action to
promote "the active inclusion of people furthest from the
labour market".
16.9 The Commission says that "active inclusion"
means a policy which combines:
- a link between excluded people
and the labour market through job opportunities or vocational
training;
- income support at a level sufficient to enable
people to have a dignified life; and
- better access to services that help to remove
obstacles to entering mainstream society (for example, helping
people to become literate and numerate; or providing access to
child care).
16.10 Among those "furthest from the labour
market", the Communication includes people who have been
unemployed for a long time, or who do not seek work, because of
chronic illness, disability, lack of basic skills, unfair discrimination
or family responsibilities.
16.11 The Commission notes that Member States' Minimum
Income schemes have the following common features:
- they ensure that basic needs
can be met, providing assistance for individuals and their dependents;
- they are non-contributory;
- the assistance is assumed to be temporary;
- they require those who are capable to be available
for work;
- they incorporate means-testing;
- eligibility depends on age and a minimum period
of residence; and
- benefits usually depend on the situation of the
household.
Within this broad framework, there are wide variations
between schemes.
16.12 According to provisional figures, in 2003 the
proportion of the total population of the EU who were at risk
of poverty was 16%; it would have been 25% if social security
benefits (excluding pensions) had not been paid.
16.13 On the other hand, in 2003 there were 31.7
million people (8.5% of the population aged 15-64) who "could
be counted as unemployed".[52]
16.14 Summing up, the Commission says that Member
States:
"have made progress both in extending basic
assistance mechanisms and in promoting the access of the most
vulnerable to the labour market. Nevertheless, the persistence
of large numbers of people at risk of poverty and excluded from
the labour market represents an inescapable challenge to the objective
of social cohesion … Furthermore, it is vital that people
outside the labour force, including the long-term unemployed,
(re)enter the labour market … Despite the diversity of situations
and policies across the EU, therefore, action at European level,
for instance in the form of common principles, basic requirements
or other means of strengthening the 1992 recommendations, might
add value to efforts by Member States by providing guidance as
well as a common analytical framework against which individual
achievements and policy instruments can be compared and assessed."[53]
16.15 The Commission goes on to invite comments by
mid-April on the following questions:
- Is further EC action needed
on social inclusion and, in particular, on the integration of
the people furthest from the labour market?
- If further action is needed, what are the most
useful ways in which the Community could complement the actions
of Member States?
- How should the Community build on the 1992 Recommendations
so as "to promote the rights and access to services needed
for the integration of excluded people"?
- Would Community action under Article 137(1)(h)
of the EC Treaty be justified? (That provision relates to action
by the Community to support and complement the activities of Member
States on the integration of people excluded from the labour market.)
16.16 The Commission will consider the responses
to these questions and publish its conclusions.
The Government's view
16.17 The Parliamentary Under-Secretary of State
at the Department of Work and Pensions (Mr James Plaskitt) tells
us that the Government has no objection to the consultations initiated
by the Commission. He says that the Government will be keen to
ensure that any further work is kept within the Lisbon Agenda,
using existing mechanisms such as the open method of coordination[54]
and National Action Plans on social inclusion. Any new EC activity
must respect the principle of subsidiarity and be fully within
the Community's competence.
16.18 The Minister will send us a copy of the Government's
response to the Commission's questions.
Conclusion
16.19 Social exclusion is a serious problem for
the unfortunate individuals who are excluded and for our society.
So we draw the Communication to the attention of the House.
16.20 We note the Government's view that any further
action by the Community should be through existing mechanisms.
We also recall that in April 2005 the Government told the previous
Committee that it would not welcome any attempt to introduce EU-wide
minimum income levels or any EU regulation on minimum income in
or out of work.
16.21 We look forward to seeing the Government's
response to the Commission's consultation paper. We shall scrutinise
any Commission proposals that emerge from the consultations. For
that reason and because we have no questions we need put to the
Minister at this stage, we are content to clear the document from
scrutiny.
49 Recommendations 92/441/EEC and 92/442/EEC of 24
June 1992. Back
50
Minimum Income schemes usually comprise a mixture of social security
benefits and tax credits or incentives. Their aim is to alleviate
social exclusion and poverty. Back
51
See (26381) 6370/05: HC 34-i (2005-06), para 44 (4 July 2005). Back
52
Commission Communication, page 5. Back
53
Commission Communication, page 9. Back
54
In March 2000, the European Council defined the open method of
co-ordination. It is designed to help Member States progressively
develop their own policies. It involves: European guidelines and
timetables for short-, medium- and long-term goals, with quantitative
indicators and benchmarks; translating these European guidelines
and timetables into national and regional policies; and periodic
monitoring, evaluation and peer review. Back
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