41 EU Programme for Social Change and
Innovation
| (33229)
15451/11
+ ADDs 1-3
COM(11) 609
| Draft Regulation on the European Union Programme for Social Change and Innovation
|
| Legal base | Articles 46(d), 149, 153(2)(a) and 175 TFEU; co-decision; QMV
|
| Department | Work and Pensions
|
| Basis of consideration | Minister's letter of 12 August 2013
|
| Previous Committee Reports | HC 86-xx (2012-13), chapter 13 (21 November 2012);
HC 86-iv (2012-13), chapter 15 (14 June 2012);
HC 428-liv (2010-12), chapter 4 (14 March 2012);
HC 428-xlv (2010-12), chapter 6 (20 December 2011); HC 428-xli (2010-12), chapter 8 (9 November 2011)
|
| Discussion in Council | No date set
|
| Committee's assessment | Politically important
|
| Committee's decision | Cleared
|
Background and previous scrutiny
41.1 The draft Regulation would establish the Programme for Social
Change and Innovation ("PSCI"), an EU funding instrument
bringing together within a single framework three existing EU
programmes which support the implementation of EU employment and
social policies and legislation. The Programme for Employment
and Social Solidarity (PROGRESS) seeks to strengthen the evidence
base for policy and promote mutual learning and the exchange of
best practice. The EURES Programme provides information and advice
to job seekers and workers on employment opportunities across
the EU. The European Microfinance Facility encourages the provision
of loans to those who would otherwise struggle to obtain credit
to set up their own businesses.
41.2 The PSCI would incorporate each of these programmes
as a separate but complementary "axis" or strand and
establish a set of common objectives, as well as specific objectives
for each axis, which are intended to support the implementation
of the Europe 2020 Strategy (especially its headline targets on
employment and social inclusion). Although the PSCI would carry
forward many elements of the three existing programmes, it would
place greater emphasis on funding for innovative projects in areas
of mutual interest with a view to testing possible solutions,
disseminating the results and increasing the efficiency of social
expenditure.
41.3 The Commission's original proposal envisaged
a budget of €958 million for the period 2014-20, with 60%
of funding allocated to the PROGRESS axis, 20% to the Microfinance
and Social Entrepreneurship axis, 15% to the EURES axis, and 5%
to be held as reserve to be allocated annually in accordance with
policy priorities. Our earlier Reports (cited in the headnote)
provide a more detailed overview of the PSCI and the Government's
position.
41.4 The Government told us that the existing programmes
had, in the main, proved to be effective and demonstrated their
added value and expressed broad support for the PSCI, welcoming,
in particular, the stronger focus on social innovation. However,
the Government highlighted the "inflated budget total"
proposed by the Commission as a key concern and suggested that
the PSCI, and the budget heading of which it forms part (growth
and competitiveness), should be increased by no more than inflation
compared to current payment levels, with the resulting reductions
distributed proportionally across all strands of the PSCI.
41.5 In June 2012, we agreed to grant a scrutiny
waiver to enable the Government to support a partial general
approach on the draft Regulation, excluding the budgetary elements,
which incorporated many of the Government's negotiating priorities,
notably:
- the removal of a 5% contingency reserve;
- the inclusion of a specific cap on administrative
spending;
- stronger Member State involvement in the management
of PSCI via expert policy committees;
- the inclusion of the principle of co-financing,
with EU support for the PROGRESS axis capped at 80% and for the
EURES axis at 95% of total expenditure; and
- greater flexibility for the EURES network of
public employment services to decide which actions they will participate
in under the PSCI.
41.6 However, progress since then has been slow,
not least because the European Parliament initially put forward
extensive amendments, many of which were at odds both with the
Government's policy objectives and the partial general approach
endorsed by the Council. We noted in our Twentieth Report of
Session 2012-13 that some significant differences would need to
be bridged in order to reach a compromise, not least on the scope
of the PSCI — with the European Parliament pressing for
the inclusion of a specific "youth axis" to address
issues related to youth unemployment — and the size of the
Programme budget. We agreed with the Government that duplication
with other EU instruments, such as the European Social Fund and
the Erasmus for All Programme (since renamed Erasmus +)
should be avoided and asked for a further progress report once
the outcome of any deal between the European Parliament and Council
became clearer.
The Minister's letter of 12 August 2013
41.7 The Minister for Employment (Mr Mark Hoban)
informs us that, following negotiations under the Cypriot and
Irish Presidencies, an agreement has been reached with the European
Parliament on a compromise text which is, in substance, largely
unchanged from the partial general approach agreed by the Council
in June 2012 and reflects the Government's negotiating priorities.
The compromise text gained majority support at the Committee
of Deputy Permanent Representatives (COREPER 1) on 10 July, with
the UK maintaining its Parliamentary scrutiny reserve. The Minister
anticipates that a First Reading agreement and final Council approval
will be achieved in October.
41.8 The Minister describes how some of the key issues
in negotiations with the European Parliament have been resolved.
He notes that the Programme has been "re-branded",
becoming the Programme for Employment and Social Innovation (EaSI
instead of PSCI), and that the budget agreed — €919,469
million at current prices — is consistent with the indicative
figures for the next EU Multiannual Financial Framework agreed
by the European Council in February and is significantly lower
than the €958 million originally proposed by the Commission.
He sets out the revised percentage budget allocations for each
of the three strands of the Programme, as follows:
- an additional 1% for the PROGRESS and Microfinance
and Social Enterprise strands, and 3% for the EURES strand, thereby
re-distributing and eliminating the 5% contingency reserve originally
proposed by the Commission — the Minister suggests that
this will strengthen budgetary discipline;
- percentage sub-allocations within each of the
three strands specifying that 80% of funding under the PROGRESS
and EURES strands, and 90% of funding under the Microfinance and
Social Enterprise strand, will be allocated to a limited set of
agreed thematic priorities in order to ensure a minimum level
of activity and critical mass of funding under each priority;
the remaining funding would be allocated, as now, between the
thematic priorities according to emerging needs; and
- scope to provide, by means of delegated acts,
for a limited reallocation of funds (not exceeding 10%) between
or within the three strands — the Minister considers that
conceding this power to the Commission, subject to the usual controls
exercised by the Council and European Parliament over delegated
acts, is an acceptable; compromise to secure the Government's
priority objectives.
41.9 The Minister notes that the European Parliament
agreed to withdraw its proposal for a separate youth axis but
the compromise text makes clear that young people are a specific
target group under each of the Programme strands and includes
a specific provision on consistency and complementarity between
EU Programmes to ensure that there is no duplication. Other changes
which the Government supports include:
- the adoption of separate work programmes for
each Programme strand, overseen by a Committee of Member State
representatives in order to ensure more cohesive working; and
- a requirement to inform relevant stakeholders,
including social partners, of how the Programme has been implemented
and its results — the Minister describes this as "a
proportionate compromise which ensured that the EP withdrew its
proposals to give social partners a strategic management role
in areas of Member State and Commission competence."
41.10 The Minister indicates that the Council made
a "key concession" in order to secure a compromise deal
with the European Parliament. He continues:
"Member States have accepted the Parliament's
wish to transfer cross-border partnership actions, currently provided
for under the European Social Fund (ESF), to this Programme on
the ground that this would make it easier to set up. Initially,
the UK, alongside most other Member States and the Commission,
took the view that such mobility was already adequately covered
by the ESF. However, this switch was a key point for the EP.
Nonetheless, I can assure you that in conceding this point to
the EP, we have maintained the existing levels of control to ensure
that there is no duplication with other funding sources and that
Member States remain free to decide whether to participate in
such actions."
41.11 The Minister concludes that the compromise
text "represents a good outcome for the UK." He asks
us to clear the draft Regulation from scrutiny, subject to there
being no significant changes of substance and to final agreement
of the EU Multiannual Financial Framework for 2014-20, so that
the Government can support its formal adoption by the Council
in the autumn.
Conclusion
41.12 We thank the Minister for providing a comprehensive
summary of the outcome of trilogue discussions with the European
Parliament and of the main elements of the compromise text which
he expects to form the basis for a First Reading deal in October.
We note that the Programme budget (subject to final agreement
on the EU Multiannual Financial Framework for 2014-20) is significantly
lower than the figure originally proposed by the Commission and
that the Government considers the compromise text to represent
a good outcome for the UK. We have no further questions to raise
and are content to clear the draft Regulation from scrutiny.
|
