EUROPEAN COMMISSION

Brussels, 20.1.2016

COM(2016) 1 final

Proposal for a

DECISION OF THE EUROPEAN PARLIAMENT AND OF THE COUNCIL

on the mobilisation of the European Globalisation Adjustment Fund
(application from Belgium – EGF/2015/007 BE/Hainaut-Namur Glass)

EXPLANATORY MEMORANDUM

CONTEXT OF THE PROPOSAL

1.The rules applicable to financial contributions from the European Globalisation Adjustment Fund (EGF) are laid down in Regulation (EU) No 1309/2013 of the European Parliament and of the Council of 17 December 2013 on the European Globalisation Adjustment Fund (2014-2020) and repealing Regulation (EC) No 1927/2006 1 (the ‘EGF Regulation’).

2.On 19 August 2015, Belgium submitted an application EGF/2015/007 BE/Hainaut-Namur Glass for a financial contribution from the EGF, following redundancies 2  in the economic sector classified under the NACE Revision 2 Division 23 (Manufacture of other non-metallic mineral products) in the NUTS level 2 regions of Hainaut (BE32) and Namur (BE35) in Belgium.

3.Following its assessment of this application, the Commission has concluded, in accordance with all applicable provisions of the EGF Regulation, that the conditions for awarding a financial contribution from the EGF are met.

SUMMARY OF THE APPLICATION

ASSESSMENT OF THE APPLICATION

Procedure

4.Belgium submitted application EGF/2015/007 BE/Hainaut-Namur Glass on 19 August 2015, within 12 weeks of the date on which the intervention criteria set out in Article 4 of the EGF Regulation were met. The Commission acknowledged receipt of the application within the deadline of two weeks from the date of submission of the application, and requested additional information from Belgium at the same time. Such additional information was provided within eight weeks of the request, after an extension of the deadline by two weeks at the duly justified request of Belgium. The deadline of 12 weeks of the receipt of the complete application within which the Commission should finalise its assessment of the application's compliance with the conditions for providing a financial contribution expires on 20 January 2016.

Eligibility of the application

Enterprises and beneficiaries concerned

5.The application relates to 412 workers made redundant in the economic sector classified under the NACE Revision 2 Division 23 (Manufacture of other non-metallic mineral products). The redundancies made by the enterprises are located in the NUTS level 2 regions of Hainaut (BE32) and Namur (BE35).

Intervention criteria

6.Belgium submitted the application under the intervention criteria of Article 4(2) derogating from the criteria of Article 4(1) (b) of the EGF Regulation, which requires at least 500 workers being made redundant over a reference period of nine months in enterprises operating in the same economic sector defined at NACE Revision 2 Division and located in one region or two contiguous regions defined at NUTS 2 level in a Member State..There were 412 redundancies combined in the NUTS level 2 regions of Hainaut (B32) and Namur (B35).

7.The reference period of nine months for the application runs from 31 August 2014 to 31 May 2015.

Calculation of redundancies and of cessation of activity

8.The redundancies during the reference period have been calculated as follows:

–412 from the date of the employer's individual notice to lay off or to terminate the contract of employment of the worker.

Eligible beneficiaries

9.The total number of eligible beneficiaries is 412.

Link between the redundancies and major structural changes in world trade patterns due to globalisation

10.In order to establish the link between the redundancies and major structural changes in world trade patterns due to globalisation, Belgium argues that Union trade in glass products has undergone serious disruptions in recent years. While demand has stagnated in Europe between 2000 and 2013, imports have dramatically increased, with foreign producers capturing a growing share of the European market 6 . This can be explained by the fact that a production overcapacity in Asia (notably in China) has resulted in downward price pressure, which European producers find hard to cope with, due to higher production costs and stricter environmental standards, notably CO2 emission quotas 7 . While demand has increased in developing economies, Europe has not managed to increase its market shares in export markets. Looking at the flat glass sector concerned by this application, production in Europe has decreased by 20 % between 2007 and 2012 8 . Between 2000 and 2010, in the glass sector as a whole, employment decreased by 32 % in Europe (particularly affecting Germany, Poland, France and Belgium) 9 . Production of glass in Belgium fell below 1 million tons in 2009 for the first time since the mid-sixties, and it continued to decrease by 5 % in both 2011 and 2012 10 . The remaining European producers are largely moving production to Asia, so that European employment in the sector has decreased by 12 % since 2010 and 27 % since the year 2000.

11.To date, the Manufacture of other non-metallic mineral products sector has been the subject of five EGF applications, two of which (including this one) based on trade related globalisation and three on the global financial and economic crisis.

Events giving rise to the redundancies and cessation of activity

12.The event giving rise to these redundancies is the closure of two production plants in Wallonia owned by the two enterprises, AGC Europe SA and Saint-Gobain Glass Benelux, respectively. These two production sites were located in the Hainaut and Namur regions respectively. AGC Europe SA invested more than EUR 48 million in its Roux (Hainaut) site between 2006 and 2010, but due to very strong competition from Asian producers (mainly in China and Japan) and the continuation of an unfavourable European economic climate, the enterprise was forced to close down production in 2014. Saint-Gobain Glass Benelux faced similar problems with its glass production in 2013, when production overcapacity in the Far East resulted in unsustainable price pressure from Asian producers. In 2014, Saint-Gobain Glass Benelux closed down production at its site in Auvelais (Namur region).

Expected impact of the redundancies as regards the local, regional or national economy and employment

13.Wallonia has a strong historical tradition of glass-making with a number of large enterprises. However, several of these enterprises have faced difficulties in recent years, particularly since the beginning of the financial and economic crisis in 2008. The number of jobs in the glass sector in the regions of Namur and Hainaut decreased from 3 940 to 3 170 (-19 %) between 2007 and 2012 11 . This situation is rendered even more difficult by the fact that the whole manufacturing sector has been downscaling production in Wallonia, with 1 236 job losses in 2013 and 1 878 job losses in 2014. In particular Hainaut is facing a difficult labour market situation with an employment rate of 52,7 % (9,2 percentage points lower than the national average) and an unemployment rate of 14,5 % (5,9 percentage points higher than the national average 12 ). The unemployment and employment figures in Namur are also unfavorable compared with the national average. The labour markets of the two regions are furthermore characterised by a high proportion of underqualified labour (almost half the job seekers in Namur and a bit more than half the job seekers in Hainaut lack upper secondary qualifications). The downscaling of production within the whole manufacturing sector will make it difficult for the target group of this application to find similar employment and upskilling efforts will definitely be needed.

Explanation of the exceptional circumstances underlying the admissibility of the application

14.Belgium argues that, despite the fact that fewer than 500 redundancies occurred within the nine-month reference period, this application should nevertheless be assimilated to an application under Article 4(1)(b) of the EGF Regulation due to exceptional circumstances having a serious impact on employment and the local, regional or national economy. The glass sector has traditionally been an important sector in Wallonia. More than 1/3 of the glass sector production units and 58 % of the glass sector employment within Belgium are to be found in this region. The Saint-Gobain Group was in 2013 forced to close another production plant in Wallonia which was the subject of the EGF/2013/011 BE/Saint-Gobain Sekurit application. Moreover, 12,3 % of the labour force in the regions concerned work in manufacturing, which has seen a decline in employment by 8 percentage points since 2007. The loss of jobs in the glass sector is considerably more significant in Hainaut and Namur, compared to both Wallonia or Belgium as a whole (the number of jobs having declined by 19 %). The exceptional circumstances surrounding this case have also been demonstrated by the Belgian authorities by reference to the unfavorable labour market situation in the two regions, demonstrated by their lower than average employment rates, high proportion of unqualified labour and high levels of long-term unemployment (36,4 % in Namur and 39,0 % in Hainaut).

Targeted beneficiaries and proposed actions

Targeted beneficiaries

15.The estimated number of redundant workers expected to participate in the measures is 412 The breakdown of these workers by sex, citizenship and age group is as follows:

16.Additionally, Belgium will provide personalised services co-financed by the EGF to up to 100 young people from the Hainaut Region not in employment, education or training (NEETs) under the age of 25 on the date of submission of the application, given that 144 of the redundancies referred to in paragraph 15 occur in the NUTS level 2 region of Hainaut (B32), which is eligible under the Youth Employment Initiative.

17.The total estimated number of targeted beneficiaries expected to participate in the measures, including NEETs, is therefore 512. 

Eligibility of the proposed actions

18.The personalised services to be provided to redundant workers and NEETs consist of the following actions:

–Support/Guidance/Integration: This set of services builds upon the standard activities carried out by the Redeployment Units. The services will be provided by a team of specialised FOREM 13 staff in partnership with organisations representing former workers to encourage participants to take part in the measures and to help them with administrative procedures. To facilitate contacts between the workers, the services are provided jointly to all the redundant workers at dedicated premises. The services cover three types of activity: (i) collective information on job-search techniques (writing a CV and application letter, using web resources, etc.), (ii) individual interviews with a FOREM adviser (skills audit, career pathway, guidance on training, etc.); (iii) free and open access to job-search tools (IT equipment with an internet connection, telephone, specialised documentation, etc.).

–Facilitating job-search: FOREM will carry out specific activities to help workers in their job-search and to overcome difficulties in the redeployment process. This includes meetings between the redundant workers and potential employers (job matching), company visits, meetings with recruiters to prepare for job interviews, and exchanges of experience with other workers who have already retrained or have found a job after a collective redundancy.

–Integrated Training: A range of specific training courses will be provided either by FOREM or by the Centres de competences or IFAPME 14 . As an initial step, FOREM staff will help each participant to define their work-related goals and guide them towards one of the training modules on offer. At the end of each training module, the new skills can be assessed and documented. Depending on the type of training and the field of competences, participants will be awarded either a formal certification of skills (i.e. a certificate of competence), a certificate of attendance (for competences or occupations for which no formal certification exists) or a validation of skills (for skills and competences acquired outside formal training courses).

–Transfer of experience: Experienced workers can enhance their skills and know-how by becoming teachers or trainers in technical education. A specific awareness-raising and pre-training module will be developed by FOREM and the federations of the various branches of technical education to encourage suitable workers to train to become vocational teachers.

–Support for enterprise creation: Workers who are considering setting up their own businesses will receive guidance and support throughout the process. This support includes two main activities: (i) collective information sessions to raise awareness on business creation opportunities, provide information on legal aspects and measures to support business creation; (ii) individual interviews with interested workers to review their plans and put them in contact with business support organisations and service providers.

–Support for collective projects: Workers who might be considering setting up a ‘social enterprise’ together as a group will receive guidance and support from a specialised consultancy and from the Redeployment Unit. This support includes information and awareness-raising sessions on business creation and basic management skills, as well as advice on setting up the undertaking (e.g. drawing up a business plan, drafting legal statutes, marketing, etc.). A support committee, which brings together representatives from the employer organisations, trade unions and FOREM, assesses the application and decides whether to award a grant. Each worker involved in the project may receive a grant of EUR 5 000 (funds being pooled together for all workers taking part). The grants can be used to cover the purchase of equipment, merchandise, publicity, consultancy, training, etc. The consultancy will administer the grants and report to FOREM on the use of expenditure (invoices and supporting documentation).

–Allowances: Job-search and training allowances will also be made available to participants.

The personalised services which are to be provided to NEETs are based on a similar approach as described above and consist of the following actions:

–Mobilisation and Guidance: A detailed profiling will allow the youths either to embark directly on further education/training or to follow a special induction session designed to promote self-confidence and explore interests.

–Training: A range of specific training courses will be provided either by FOREM or by the Centres de competences or IFAPME.

–Personalised upskilling: A personalised upskilling pathway will be designed for each NEET participating in this measure.

–Allowances: Job-search and training allowances will also be offered to participants.

19.The proposed actions, here described, constitute active labour market measures within the eligible actions set out in Article 7 of the EGF Regulation. These actions do not substitute passive social protection measures.

20.The Belgian authorities have provided the required information on actions that are mandatory for the enterprise concerned by virtue of national law or pursuant to collective agreements. They have confirmed that a financial contribution from the EGF will not replace such actions.

Estimated budget

21.The estimated total costs are EUR 1 825 907, comprising expenditure for personalised services of EUR 1 758 507 and expenditure for preparatory, management, information and publicity, control and reporting activities of EUR 67 400.

22.The total financial contribution requested from the EGF is EUR 1 095 544 (60 % of total costs).

23.The costs of the actions identified in the table above as actions under Article 7(1)(b) of the EGF Regulation do not exceed 35 % of the total costs for the coordinated package of personalised services. These actions are conditional on the active participation of the targeted beneficiaries in job-search or training activities.

24.Belgium confirmed that the costs of investments for self-employment, business start-ups and employee take-overs will not exceed EUR 15 000 per beneficiary.

Period of eligibility of expenditure

25.Belgium started providing the personalised services to the targeted beneficiaries on 10 September 2014. The expenditure on the actions will therefore be eligible for a financial contribution from the EGF from 10 September 2014 to 19 August 2017.

26.Belgium started incurring the administrative expenditure to implement the EGF on 9 July 2014. The expenditure for preparatory, management, information and publicity, control and reporting activities shall therefore be eligible for a financial contribution from the EGF from 9 July 2014 to 19 February 2018.

Complementarity with actions funded by national or Union funds

27.The sources of national pre-financing or co-funding are the Walloon Public Employment service (FOREM) and the Region of Wallonia.

28.Belgium has confirmed that the measures described above receiving a financial contribution from the EGF will not also receive financial contributions from other Union financial instruments.

Procedures for consulting the targeted beneficiaries or their representatives or the social partners as well as local and regional authorities

29.Belgium has indicated that the co-ordinated package of personalised services has been drawn up in consultation with all stakeholders including social partners, enterprises and the public employment services. Through a Monitoring Committee, those stakeholders will closely follow the implementation of the proposed measures.

Management and control systems

30.The application contains a description of the management and control system which specifies the responsibilities of the bodies involved. Belgium has notified the Commission that the financial contribution will be managed and controlled by the same bodies which are responsible for the European Social Fund (ESF).

Commitments provided by the Member State concerned

31.Belgium has provided all necessary assurances regarding the following:

–the principles of equality of treatment and non-discrimination will be respected in the access to the proposed actions and their implementation,

–the requirements laid down in national and EU legislation concerning collective redundancies have been complied with,

–the dismissing enterprises, which have continued their activities after the lay-offs, have complied with their legal obligations governing the redundancies and provided for their workers accordingly,

–the proposed actions will not receive financial support from other Union funds or financial instruments and any double financing will be prevented,

–the proposed actions will be complementary with actions funded by the Structural Funds,

–the financial contribution from the EGF will comply with the procedural and material Union rules on State aid.

BUDGETARY IMPLICATION

Budgetary proposal

32.The EGF shall not exceed a maximum annual amount of EUR 150 million (2011 prices), as laid down in Article 12 of Council Regulation (EU, Euratom) No 1311/2013 of 2 December 2013 laying down the multiannual financial framework for the years 2014-2020 16 .

33.Having examined the application in respect of the conditions set out in Article 13(1) of the EGF Regulation, and having taken into account the number of targeted beneficiaries, the proposed actions and the estimated costs, the Commission proposes to mobilise the EGF for the amount of EUR 1 095 544, representing 60 % of the total costs of the proposed actions, in order to provide a financial contribution for the application.

34.The proposed decision to mobilise the EGF will be taken jointly by the European Parliament and the Council, as laid down in point 13 of the Interinstitutional Agreement of 2 December 2013 between the European Parliament, the Council and the Commission on budgetary discipline, on cooperation in budgetary matters and on sound financial management 17 .

Related acts

35.At the same time as it presents this proposal for a decision to mobilise the EGF, the Commission will present to the European Parliament and to the Council a proposal for a transfer to the relevant budgetary line for the amount of EUR 1 095 544.

36.At the same time as it adopts this proposal for a decision to mobilise the EGF, the Commission will adopt a decision on a financial contribution, by means of an implementing act, which will enter into force on the date at which the European Parliament and the Council adopt the proposed decision to mobilise the EGF.

Proposal for a

DECISION OF THE EUROPEAN PARLIAMENT AND OF THE COUNCIL

on the mobilisation of the European Globalisation Adjustment Fund
(application from Belgium – EGF/2015/007 BE/Hainaut-Namur Glass)

THE EUROPEAN PARLIAMENT AND THE COUNCIL OF THE EUROPEAN UNION,

Having regard to the Treaty on the Functioning of the European Union,

Having regard to Regulation (EU) No 1309/2013 of the European Parliament and of the Council of 17 December 2013 on the European Globalisation Adjustment Fund (2014-2020) and repealing Regulation (EC) No 1927/2006 18 , and in particular Article 15(4) thereof,

Having regard to the Interinstitutional Agreement of 2 December 2013 between the European Parliament, the Council and the Commission on budgetary discipline, on cooperation in budgetary matters and on sound financial management 19 , and in particular point 13 thereof,

Having regard to the proposal from the European Commission,

Whereas:

(1)The European Globalisation Adjustment Fund (EGF) aims to provide support for workers made redundant and self-employed persons whose activity has ceased as a result of major structural changes in world trade patterns due to globalisation, as a result of a continuation of the global financial and economic crisis, or as a result of a new global financial and economic crisis, and to assist them with their reintegration into the labour market.

(2)The EGF is not to exceed a maximum annual amount of EUR 150 million (2011 prices), as laid down in Article 12 of Council Regulation (EU, Euratom) No 1311/2013 20 .

(3)On 19 August 2015, Belgium submitted an application EGF/2015/007 BE/Hainaut-Namur Glass for a financial contribution from the EGF, following redundancies and cessations of activities (hereafter referred to as ‘redundancies’) in the economic sector classified under the NACE Revision 2 Division 23 (Manufacture of other non-metallic mineral products) in the NUTS 21 level 2 regions of Hainaut (B32) and Namur (B35) in Belgium. It was supplemented by additional information provided in accordance with Article 8(3) of Regulation (EU) No 1309/2013. That application complies with the requirements for determining a financial contribution from the EGF as laid down in Article 13 of Regulation (EU) No 1309/2013.

(4)In accordance with Article 6(2) of Regulation (EU) No 1309/2013, Belgium has decided to provide personalised services co-financed by the EGF also to 100 young persons not in employment, education or training (NEETs).

(5)In accordance with Article 4(2) of Regulation (EU) No 1309/2013, the application from Belgium is considered admissible since the redundancies have a serious impact on employment and the local, regional and national economy.

(6)The EGF should, therefore, be mobilised in order to provide a financial contribution of EUR 1 095 544 in respect of the application submitted by Belgium.

(7)In order to minimise the time taken to mobilise the EGF, this decision should apply from the date of its adoption,

HAVE ADOPTED THIS DECISION:

Article 1

For the general budget of the European Union for the financial year 2016, the European Globalisation Adjustment Fund shall be mobilised to provide the sum of EUR 1 095 544 in commitment and payment appropriations.

Article 2

This Decision shall enter into force on the day of its publication in the Official Journal of the European Union. It shall apply from [the date of its adoption] 22 .

Done at Brussels,

(1) OJ L 347, 20.12.2013, p. 855.

(2) Within the meaning of Article 3 of the EGF Regulation.

(3) Commission Regulation (EU) No 1046/2012 of 8 November 2012 implementing Regulation (EC) No 1059/2003 of the European Parliament and of the Council on the establishment of a common classification of territorial units for statistics (NUTS) as regards the transmission of the time series for the new regional breakdown (OJ L 310, 9.11.2012, p. 34).

(4) OJ L 393, 30.12.2006, p. 1.

(5) In accordance with the fourth paragraph of Article 7 of Regulation (EU) No 1309/2013.

(6) Overview of the Glass Sector, Cambridge Econometrics, 22 October 2014

(7) Rapport Annuel 2013, Fédération de l'Industrie du Verre

(8) Une Politique Industrielle pour le secteur du verre, Comité Economique et Social Européen, 8 Juillet 2014

(9) SYNDEX, 23 October 2013

(10) Rapport Annuel 2013, Fédération de l'Industrie du Verre.

(11) FOREM data

(12) SPF Economie, Classes moyennes et Energie, Enquête sur les forces de travail, 2015

(13) The Walloon Public Employment Service

(14) IFAPME (Institut wallon de Formation en Alternance et des indépendants et Petites et Moyennes Entreprises) is a public training institute that provides work-linked dual training in the form of apprenticeships and specific courses for SME managers.

(15) Approximations based on the number of participants and total costs.

(16) OJ L 347, 20.12.2013, p. 884.

(17) OJ C 373, 20.12.2013, p. 1.

(18) OJ L 347, 20.12.2013, p. 855.

(19) OJ C 373, 20.12.2013, p. 1.

(20) Council Regulation (EU, Euratom) No 1311/2013 laying down the multiannual financial framework for the years 2014-2020 (OJ L 347, 20.12.2013, p. 884).

(21) Commission Regulation (EU) No 1046/2012 of 8 November 2012 implementing Regulation (EC) No 1059/2003 of the European Parliament and of the Council on the establishment of a common classification of territorial units for statistics (NUTS) as regards the transmission of the time series for the new regional breakdown (OJ L 310, 9.11.2012, p. 34).

(22) Date to be inserted by the Parliament before the publication in OJ.