Documents considered by the Committee on 12 January 2011 - European Scrutiny Committee Contents

7 Europe 2020 — An Agenda for new skills and jobs


17066/1/10 REV1

COM(10) 682

Commission Communication: An Agenda for new skills and jobs: A European contribution towards full employment

Legal base
Document originated26 November 2010
Deposited in Parliament29 November 2010
DepartmentBusiness, Innovation and Skills
Basis of considerationEM of 16 December 2010
Previous Committee ReportNone
To be discussed in CouncilDecember
Committee's assessmentPolitically important
Committee's decisionCleared


7.1 Article 3 of the Treaty on European Union (TEU) sets out the objectives of Union action which include "the sustainable development of Europe based on balanced economic growth and price stability, a highly competitive social market economy, aiming at full employment and social progress, and a high level of protection and improvement of the environment." Article 9 of the Treaty on the Functioning of the European Union (TFEU) further requires the Union, in all its policies and actions, to "take into account requirements linked to the promotion of a high level of employment, the guarantee of adequate social protection, the fight against social exclusion, and a high level of education, training and protection of human health."

7.2 The EU's Europe 2020 Strategy for Jobs and Growth is intended to help EU Member States to recover from the economic and financial crisis by stimulating "competitiveness, productivity, growth potential, social cohesion and economic convergence."[39] In June 2010, the European Council agreed five "headline targets" which the Strategy should help to achieve. The headline target for employment seeks to raise the employment rate of women and men aged between 20 and 64 to 75% by 2020 and emphasises the need for greater labour market opportunities for young people, older workers, low-skilled workers and migrants.

The Commission Communication

7.3 The Commission's Communication, An Agenda for New Skills and Jobs, is one of seven "flagship initiatives" proposed to implement the Europe 2020 Strategy. The Commission says that "in times of budgetary constraints and unprecedented global competitive pressures, EU employment and skills policies that help shape the transition to a green, smart and innovative economy must be a matter of priority."[40] The Commission therefore proposes to focus on four priory objectives:

  • Better functioning labour markets, based on the Common Principles of Flexicurity agreed by the Council in 2007 which contemplate a combination of flexible and reliable contractual arrangements, comprehensive lifelong learning strategies, effective active labour market policies, and modern, adequate and sustainable social protection systems;[41]
  • Better matching of skills to labour market needs, including through greater investment in education, training and lifelong learning, improved systems for anticipating skills needs and a strong emphasis on promoting geographical mobility;
  • Better job quality and working conditions, based on a "smarter legal framework" which keeps pace with new working patterns and technologies and helps rather than hinders workplace adaptation; and
  • Supporting job creation, including through the removal of obstacles to setting up businesses and hiring staff, a reduction in non-wage labour costs and the promotion of entrepreneurship and self-employment.

7.4 The Commission says that Member States bear the main responsibility for achieving these objectives, using appropriate policies and tools developed at national level. The purpose of the Agenda for New Skills and Jobs is to identify 13 "key actions", and a range of accompanying measures, which the Commission proposes to undertake as part of the EU's contribution to implementing the Europe 2020 Strategy. The key actions and accompanying measures proposed for each priority objective are summarised below.


7.5 The Commission says that flexicurity policies developed at national level, such as short-time working arrangements, incentives for business start-ups or new training and work experience programmes, have helped Member States to weather the economic crisis and mitigate the fall in the growth of employment in 2008-09 but more needs to be done to strengthen labour market reform. The Commission proposes three key actions:

  • organising a Stakeholder Conference on Flexicurity in 2011 involving Member States, the European Parliament, the Commission and social partners to consider ways of strengthening the EU's Common Principles of Flexicurity to encourage cost-effective reforms, followed by a Commission Communication in 2012 to give new momentum to the flexicurity concept;
  • a Commission Communication on the implementation of lifelong learning strategies and competence development in 2012, as well as a European Policy Handbook establishing a framework for lifelong learning and a renewed Action Plan for Adult Learning; and
  • organising a Tripartite Social Forum in 2011 to discuss the Agenda for New Skills and Jobs and flexicurity policies ahead of the Tripartite Social Summit[42] which precedes the Spring European Council.

7.6 The Commission contemplates three further accompanying measures:

  • the introduction in 2011 of a comprehensive methodology to monitor Member States' progress in implementing flexicurity principles;
  • the establishment, by the end of 2011, of a partnership between employment services to develop an EU-level strategic dialogue on labour market transitions (providing security to enable workers to move between jobs or to help them out of education, training or unemployment into work); and
  • consultation with social partners on the creation of a European framework for the advance planning and implementation of industrial restructuring.


7.7 The Commission says that the economic crisis has accelerated the pace of industrial restructuring and exposed important skills gaps, especially in areas with persistently high levels of unemployment. The intra-EU labour mobility of EU citizens remains low and skilled non-EU migrants tend to occupy low-skilled jobs. The Commission proposes five key actions:

  • the production, by 2012, of an on-line EU Skills Panorama providing information on labour market needs, skills shortages, areas of employment growth across the EU as well as projections on future trends;
  • the completion in all languages, by 2012, of the European Skills, Competences and Occupations classification (ESCO), a labour market tool for employers and job seekers which describes the main skills and qualifications needed for a wide range of jobs;
  • evaluation of the Professional Qualifications Directive with a view to proposing changes in 2012 to ease procedures for the recognition of qualifications;
  • the launch, in 2011, of a New Agenda for Integration to remove barriers to the economic and social integration of third country nationals legally resident in the EU; and
  • possible measures in 2012 to enable EU migrant workers to enforce their free movement rights more easily.

7.8 The Commission proposes twelve accompanying measures to be undertaken in 2011 and 2012:

  • help young people to make the transition from school to work by establishing a new benchmark on "education for employability", proposing a Council recommendation on ways of reducing early school leaving, and setting up a High Level Group to improve literacy;
  • launch a campaign to raise awareness about EU social security coordination rules to encourage mobility within the EU;
  • use the SME Performance Review to consider the future skills needs of micro and craft enterprises;
  • promote skills and competences needed to ensure the sustainable development of the EU, in line with the Roadmap towards a resource-efficient Europe and the Eco-Innovation Action Plan;
  • support the creation of "knowledge alliances" which bring together the business and education sectors and help to develop new curricula to address skills gaps and match labour market needs;
  • propose a Council Recommendation on how to record and validate competences gained outside formal education and training and establish a European Skills Passport;
  • produce an analysis of how migration policies can contribute to meeting skills gaps and develop a policy network to consider ways of improving the educational attainment of migrant students;
  • reform the European Employment Services (EURES) to improve its capacity to match skills and jobs;
  • propose an EU-wide approach to the inclusion of ICT skills and digital literacy in Member States' lifelong learning policies;
  • present a Communication on multilingualism to encourage language learning;
  • develop an action plan to address the shortfall in the supply of health workers; and
  • promote the development of European centres of excellence specialising in the skills needed for future jobs.


7.9 The Commission says that the economic crisis has exacerbated the risk of a deterioration in working conditions but adds that "the working environment plays a crucial role in enhancing the potential of the workforce and is a leading competitiveness factor." The key actions proposed by the Commission seek to preserve the existing EU acquis on working conditions, health and safety at work, the rights of workers to information, consultation and participation, and non-discrimination in the workplace while also recognising the need to ensure that EU laws are easy to understand and apply for businesses and workers. The Commission proposes:

  • a review of the Working Time and Posted Workers Directives;
  • a new EU Strategy on Health and Safety for 2013-20;
  • a review of the effectiveness of EU legislation on information and consultation of workers, as well as a review of the impact on women's pay and participation in the labour market of Directives on part-time work and fixed-term contracts; and
  • a comprehensive review of EU health and safety legislation.

7.10 The Commission proposes three further accompanying measures:

  • an initiative to strengthen cooperation between labour inspectorates to crack down on undeclared work;
  • a review of the policy concept of "quality work"; and
  • an examination of the impact of two EU Directives seeking to prohibit discrimination within the workplace.


7.11 The Commission says that recovery from the economic crisis must be based on job creation and proposes one key action:

  • the development of guiding principles on how to foster the conditions for job creation, including the removal of obstacles to setting up a business, the reduction of non-wage labour costs, and incentives to encourage individuals to take up regular employment rather than undeclared work.

7.12 Accompanying measures proposed by the Commission contemplate the establishment of a permanent Erasmus programme for Young Entrepreneurs and the production of a policy handbook on "entrepreneurship education" to help teachers encourage entrepreneurship in schools.

7.13 The Commission recognises that, "in light of the current fiscal constraints on national budgets, Member States and the Commission must focus on making better use of EU funds."[43] The Commission suggest that more could be done to use existing EU financial instruments — the European Social Fund, European Regional Development Fund, Rural Development Fund and the Lifelong Learning Programme — to support reforms in the field of employment, education and training. The Commission also refers to ideas set out in its consultation document on the future of EU cohesion policy which include a much closer alignment between EU finding instruments and the objectives of the Europe 2020 Strategy and the introduction of greater economic conditionality which would make the disbursement of cohesion funding conditional on implementing certain reform measures identified in a development and partnership contract with each Member State.[44]

7.14 The Commission says that the Agenda for New Skills and Jobs is one of a number of initiatives which form part of an integrated approach to implement the Europe 2020 Strategy and which involve a mixture of policy instruments, including legislation, policy coordination, social dialogue, funding and strategic partnerships.[45] It will review the four priorities identified in the Agenda in 2014, after the EU's next Multiannual Financial Framework has been agreed.

The Government's view

7.15 The Minister for Employment Relations, Consumer and Postal Affairs (Mr Edward Davey) notes that the Commission Communication does not contain any specific legislative proposals but sets out a work programme to help achieve the 75% employment rate target agreed by the European Council when approving the Europe 2020 Strategy. He says that the Government is content with the four strategic priorities identified in the Communication and considers that they can help "to ensure that EU employment and skills policies help shape the transition to a green, smart and innovative economy."[46]

7.16 The Minister expresses the Government's support in principle for non-legislative initiatives "where these can help Member States to develop their own policy solutions consistent with their national circumstances, structures and traditions." He adds,

"Where plans could lead to legislative proposals, the Government will look closely at any proposals to ensure, not only that the EU acts only where it has competence, but also that it is clear Member States cannot do better acting on their own, consistent with the principles of subsidiarity, and that any actions are proportionate and do not result in the imposition of new costs on Member States or regulatory burdens on businesses. For example proposals to amend the Working Time Directive would cause concern were they to threaten retention of the opt-out allowing individuals who choose to work longer that the 48 hour working week. And measures concerning the implementation of the Posted Workers Directive could also lead to concerns were they to undermine Member State rights over their own employment law and structures."[47]

7.17 The Minister welcomes the emphasis placed on developing "a smarter EU legal framework for employment and health and safety at work" (including greater use of 'soft' (non-legislative) instruments) and supports any simplification or reduction of administrative burdens resulting from the Commission's proposed review of the EU's employment and health and safety acquis.

7.18 The Minister endorses the need to realise maximum value from EU funds and says that the Government is keen to explore the potential for integrating cohesion policy instruments (such as the European Social Fund and the European Regional Development Fund) with other EU funding instruments so as to streamline investment. However, he expresses the Government's

"principled objection to proposals for contractually binding 'conditionality' to be applied to funding. There should be no punitive link between Member States' entitlement to Structural and Cohesion Funds and the effectiveness of Member States' institutions and macroeconomic policies, which should be addressed through other established channels and which, in any case, would be challenging for others to measure."[48]

The Minister adds that any proposals resulting from the Communication must not pre-empt negotiations on the EU's next financial perspective for the period 2014-20.


7.19 The Agenda for New Skills and Jobs outlined in the Commission Communication is one of seven flagship initiatives which, together, are intended to implement the objectives and achieve the headline targets set out in the Europe 2020 Strategy. As such, it is clearly an important document which we are therefore drawing to the attention of the House.

7.20 The focus on flexible labour markets which preserve the fundamentals of the EU's social market economy while creating new, high quality jobs is likely to command the support of all Member States, but the mix of policies and instruments to achieve these goals may prove to be considerably more contentious. The breadth and generality of the Communication make it difficult to foresee at this stage whether the key actions and accompanying measures proposed by the Commission are justified in terms of the EU's competence to act in a particular area (for example, education or social security entitlements) and in terms of their added value and respect for the principle of susbidiarity. We are therefore clearing the document from scrutiny but will consider carefully measures to implement the Agenda for New Skills and Jobs as and when each of them is put forward.

39   See the European Council's Conclusions of 17 June 2010.  Back

40   See paragraph 2, page 2 of the Commission Communication. Back

41   See Council Conclusions of 5/6 December 2007, Council document 16201/07.  Back

42   The Tripartite Social Summit is a form of institutionalised dialogue involving the social partners, the Council Presidency and Commission. Back

43   See page 19 of the Commission's Communication.  Back

44   See HC 428-xii (2010-11), chapter 6 (15 December 2010). Back

45   Other initiatives include Youth on the Move and the Strategy for Equality between Women and Men 2010-15 (see HC 428-iv (2010-11), chapters 8 and 15 (20 October 2010). Back

46   See paragraph 2 of the Minister's Explanatory Memorandum.  Back

47   See paragraph 25 of the Minister's Explanatory Memorandum. Back

48   See paragraph 27 of the Minister's Explanatory Memorandum.  Back

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