Seventh Report of Session 2008-09 - European Scrutiny Committee Contents


10 Open Method of Coordination for social protection and social inclusion

(29821)

11560/08

COM(08) 418

+ ADDs 1-2

+ ADD 3

+ ADD 4

Commission Communication: A renewed commitment to social Europe: reinforcing the Open Method of Coordination for social protection and social inclusion

Commission staff working documents: impact assessment and summary of assessment

Commission staff working document: efficiency and effectiveness of social spending

Commission staff working document: biennial report on social services of general interest

Legal base
DepartmentWork and Pensions
Basis of considerationMinister's letters of 3 December 2008 and 26 January 2009
Previous Committee ReportHC 16-xxix (2007-08), chapter 5 (10 September 2008)
Discussed in Council17 December 2008
Committee's assessmentPolitically important
Committee's decisionCleared

Legal base for Community action

10.1 Three Articles of the EC Treaty provide the legal base for Community action on social policy:

  • Article 136 requires the Community and Member States to have as their objective (among other things) the promotion of employment, the improvement of living conditions, proper social protection and combating social exclusion.
  • Article 137 requires the Community to support and complement the activities of Member States on (among other things) social security, the social protection of workers, the integration of people excluded from the labour market and the modernisation of social protection systems.
  • Article 140 requires the Commission to encourage cooperation between Member States and to facilitate the coordination of their action in all fields of social policy.

10.2 In addition, Article 144 of the EC Treaty requires the Council to establish the Social Protection Committee to promote cooperation between Member States on social protection policy, monitor social conditions, encourage the exchange of information and good practice, give advice and do work at the request of the Council or Commission. The members of the Social Protection Committee are officials of the Member States and the Commission.

The development of the Open Method of Coordination

10.3 The European Council defined the Open Method of Coordination (OMC) in 2000 when approving the Lisbon Strategy. The main ingredients of the OMC are as follows:

  • Member States voluntarily agree EU-wide objectives and goals;
  • they also define a set of common indicators to measure progress towards the achievement of the objectives;
  • each Member State translates the common objectives into national policies; and
  • progress is assessed jointly by the Commission and Member States.

10.4 This general framework has been applied to a variety of EC policy areas, including social policy and there is now a single OMC for social protection and social inclusion ("the Social OMC").

10.5 The Council has agreed both general and specific objectives for the Social OMC. The general objectives are to promote:

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

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

"(c) good governance, transparency and the involvement of stakeholders in the design, implementation and monitoring of policy."

The specific objectives include, for example, ensuring that everyone has access to a retirement income which enables them to maintain, to a reasonable degree, their standard of living after retirement. Member States have also agreed 14 EU-wide indictors to monitor progress towards the objectives. Member States produce national action plans once every three years. Each plan reports on the Member State's progress towards achieving the OMC's objectives and its intentions for further action. The national plans provide the basis for a Joint Report by the Commission and Council to the European Council.

Previous scrutiny of the document

10.6 In September 2008, we considered this Communication from the Commission.[28] It takes account of the views of the Member States, the Social Protection Committee, regional and local authorities, service providers, academics and others who responded to the Commission's public consultations about the strengths and weaknesses of the Social OMC. Their general assessment was largely positive. But the Commission had concluded that there are some important weaknesses in the Social OMC and it needs strengthening.

10.7 The Commission suggests, for example, that:

  • each Member State might define and publicise its own national quantified targets for such things as minimum retirement pensions, the reduction of poverty, increases in life expectancy and reductions in infant mortality;
  • Member States with similar problems might wish to work together in sub-groups, under the umbrella of the OMC;
  • the Commission will make Recommendations for common principles to be used in monitoring and peer reviews;
  • improvements are needed in the collection and analysis of statistics relevant to social policy; and
  • there should be better and more extensive use of peer review.

10.8 The then Parliamentary Under-Secretary of State at the Department for Work and Pensions (Mr James Plaskitt) told us that the Government would be carefully considering each of the detailed proposals in the Communication.

10.9 In our report on the Communication, we said that, on the one hand, the EC Treaty provides a legal base for the Community to provide support for the social policies of the Member States. And Article 140 of the Treaty gives the Commission responsibility for encouraging cooperation between Member States and facilitating the coordination of their action on social policy. On the other hand, there is no specific Treaty provision for the Open Method of Coordination. Cooperation between the Member States on social policy is voluntary; and it is the Member States — not the Commission or the Community — who make the policies and have the responsibility for implementing them. We concluded, therefore, that constant vigilance is required to ensure both that the Commission does not exceed the functions given to it by the EC Treaty and that the Council, after discussion with the Commission, determines how the OMC operates. We asked the Minister to tell us the outcome of the Government's detailed consideration of the proposals. Meanwhile, we kept the document under scrutiny.

The Minister's letter of 3 December 2008

10.10 In his letter of 3 December, the Parliamentary Under-Secretary of State at the Department for Work and Pensions (Mr Jonathan Shaw) told us that the Government:

  • had obtained an assurance that the Commission that was only encouraging Member States to set their own targets as a matter of good practice; it was not advocating the creation of common EU-wide targets;
  • DWP and Treasury officials were considering whether the UK's current national targets should be widened; and, in particular, whether to recommend targets for UK pensions;
  • the Government agreed with the Commission that there can be an advantage in those Member States with a shared interest in a subject coming together in a sub-group of the OMC;
  • the Government also agreed with the Commission about the need for better collection and analysis of social statistics but will examine each proposal for additional collections to see if it would entail disproportionate cost or administrative work;
  • the Social Protection Committee (comprised of senior officials from the Member States) had produced an Opinion on the Communication. It reflected the Government's priorities for the OMC, stating for example that setting quantified national targets is a core responsibility of the Member States; and
  • the Minister expected the Employment and Social Policy Council to approve the Opinion at its meeting on 17 December.

10.11 We thanked the Minister for his helpful letter and asked him to tell us about the outcome of the Employment and Social Policy Council's discussion.

The Minister's letter of 26 January 2009

10.12 The Minister tells us that, because of the need to discuss responses to the economic down-turn and the European Parliament's proposed amendments to the Working Time Directive, the Council did not have time for a substantive discussion of the Communication at its meeting on 17 December. But the Council unanimously adopted the Social Policy Committee's Opinion.

10.13 The Minister says that:

"This successful outcome for the UK is already being reflected in early follow-up. For example, discussion of the draft Joint Report for Social Protection and Social Inclusion, at the [meeting of the Social Protection Committee on] 15 January … confirmed that the Commission is promoting the use of national targets as a potentially useful tool — consistent with the sharing of information and good practice under the Open Method of Coordination — but accepts that this is a matter for member states."

The Minister adds that the Government has good support from other Member States on the need to respect national competence and that it will continue to take a positive part on the OMC as a valuable means for Member States to learn from each other.

Conclusion

10.14 We are grateful to the Minister for the information in his letters of 3 December and 26 January. It seems to us clear that the Government is well aware of the need to resist any move by the Commission to intrude on Member States' responsibilities for social policy and that it wants the OMC to remain a flexible means for voluntary cooperation. We welcome the Opinion of the Social Protection Committee and the Council's adoption of it on 17 December.

10.15 We have no further questions to put to the Minister and we are now content to clear the document from scrutiny.





28   (29821) 11560/08: see HC 16-xxix (2007-08), chapter 5 (10 September 2008). Back


 
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Prepared 13 February 2009