Creating Social Europe?

From EMU to the EES and the EU Social Policy Agenda

Structure of lecture

• European Monetary Union and its problems

• National Action Plans and the European Employment Strategy

• The Open Method of Co-ordination: new remits for ‘soft law’

• Towards a ‘Social Europe’?

Forces promoting economic integration & fear of social dumping• Globalisation and international financial

institutions (World Bank liberalism)• Multi-national corporations and international

financial markets• EMU and Growth and Stability Pact

– Agreed limits on debt – Member states lose interest rate / devaluation options– Cuts in welfare (esp. pensions)– ‘social insurance destroys jobs’ = competitive

restructuring ‘the drive to the bottom’?

Maastricht promotes negotiated solutions

• ‘Social Pacts’ – match wage control for job creation and welfare

protection – Holland, Italy, Denmark, Finland and Ireland

• 1999 Cologne Protocol– States to co-ordinate wages with monetary & fiscal

policies and productivity agreements– Structured social budgets

• Gender: EU reinforces women’s rights and participation rates rise.

http://europa.eu.int/comm/employment_social/equ_opp/index_en.htm For specific questions on the gender equality programme:eqop@cec.eu.int

ESF expenditure on gender equality Share of ESF assistance (2000-2006) for equal opportunities in % Denmark has no specific allocation for gender equality as gender has been fully mainstreamed. Source: Communication from the Commission on European Social Fund support for the European Employment Strategy, 23.01.2001, COM (2001) 16 final/2

Amsterdam (1997), Luxembourg Process and Lisbon

• Amsterdam: European Employment Strategy– National Action Plans for Employment– EU to draw up guidelines and monitor performance– Objects:

• Create ‘more and better jobs’• Raise productivity• Promote regional and social cohesion

– Not legally binding: no sanctions

• Lisbon (2000): – attack on social exclusion– promotion of ‘knowledge based society’

• Barcelona (2002): raise participation older workers

EU Social Policy Agenda

• Directives on:– Work / life balance– Lifelong learning– Active aging

• Open Method of Co-ordination (‘soft law’)– Benchmarks performance– Enables policy learning

• EES and OMC recreates division between ‘good’ and ‘bad’ social expenditure

Kok 5-year report on EES (2005)

• Target: 70% male: 60% female (inc. 50% older workers) to be reached by 2010

• Main findings:– EU 15: employment up by 12 million– But male rate = 64% and female rate = 55%– EU 25 need 22 million jobs & 2% p.a. growth– Labour productivity slowed (poor quality jobs)– Black markets have grown– Long term unemployment grows– ‘working poor’ emerge

Kok report: priorities

• Problems: – low domestic demand + strong Euro– Better governance (weakness of OMC):

• more mutual learning• NAPEs need more political legitimacy

• 3 priorities– Attract (& keep) people (esp. older) in jobs by ‘making

work pay’ (tax incentives)– Raise adaptability of workers (multi-tasking)– Invest in human capital (education)

UK performance

• Weakness:– Like elsewhere, job quality neglected– Working poor– Gender pay gap widest in EU– Skill shortages / low productivity (training)– No social dialogue on EES

• Strengths– High female participation rates– Lower ‘unemployment’ (but incapacity and NEETS)

Open Method of Co-ordination: shifting strategies

• From EES to other social agendas– Pensions– Health care– Social inclusion– Role of ECOFIN in identifying welfare priorities

• Target setting and benchmarking as means to co-ordinate social Europe?– Lack of sanctions– ‘naming and shaming’– Performance to statistical target, not social objective

EU welfare futures?

• Leibfried: EU member states ‘saturated’ in welfare– Liberalisation is partial: little convergence– Welfare regime retain national identities (no multi-

national solidarity to defend welfare)– EU still contains Sweden and UK.

• Rhodes and Ferrera– Focus on negotiated flexibility (Netherlands &

Denmark)– Tax-funding of social support– Help to focus on placement of unskilled & marginal– Reconstruct retirement

Remaining problems

• Expansion of EU membership to 25 states (and new members view USA as paradigm)

• Refugees and migrant labour• (Offe) without ‘hard’ EU law, voters resurrect

national barriers of protection– UKIP in UK– Le Pen in France– Dutch & Swedish & East German equivalents

• Dwindling influence of OMC: current crisis