Rapporteur:	Cristian PÎRVULESCU
Co-rapporteur:	Ozlem YILDIRIM

Plenary Assembly decision	23.1.2023
Legal basis	Rule 52(2) of the Rules of Procedure
	Own-initiative opinion
Section responsible	Employment, Social Affairs and Citizenship
Adopted in section	5.9.2023
Adopted at plenary	21.9.2023
Plenary session No	581
Outcome of vote (for/against/abstentions)	152/3/9

1.   Conclusions and recommendations

1.1.

As a Union of democracies, the EU recognises the key role civil society has in maintaining a solid representative and pluralist government. Civil Society Organisations (CSOs) also play a key role in the decision-making process and formulation of new legislation, based on their knowledge and experience on specific issues and by helping the most vulnerable members of our societies have a voice in the process.

1.2.

EU support for CSOs does not at all match the centrality of their role and responsibilities envisaged in various reform packages. Despite the hopes invested in them for addressing democratic vulnerabilities and preventing authoritarian drifts, they do not have the proper support needed to fulfil their critical mission. It is more than concerning that the EU budget has so few resources dedicated to CSO support. For the European Economic and Social Committee (EESC), this is unacceptable and has to be immediately addressed.

1.3.

The EESC supports setting up a financial instrument specifically dedicated to EU-based CSOs working on human rights and democracy, equivalent to the European Instrument for Democracy and Human Rights (EIDHR), which is available for extra-EU activities. The EU also helps human rights defenders abroad through its protection platform ‘Protect Defenders’, and it should establish a similar platform for those working in the EU Member States.

1.4.

A key challenge in access to funding is the creation of a multiple-tier system of CSOs in which those working on the most difficult social and political issues, like watchdog organisations or those promoting equality and non-discrimination, tend to have the most serious financing problems.

1.5.

Because of the limitations in access to funding and support, a wide range of detrimental effects are felt in the CSO sector. One of these is that people involved in CSOs are often working under great stress, with enormous risks for their mental health (a situation that can only be exacerbated by attacks from those in power, including through strategic lawsuits against public participation, SLAPPs). Limitations to access to funding may lead to lower and/or uncertain income for those who work in CSOs, leading to a loss of valuable expertise and commitment. Organisational memory and resources are lost. Impact on society and decision-making can also decrease.

1.6.

The EESC draws attention to the need to consider appropriate ways to address the precarity of work in the CSO sector active in the area of democracy, rule of law and fundamental rights. While persons employed in CSOs as employees are subject to the national rules governing contracts of employment, the lack of funding, and associated uncertainties, often limit the ability of CSOs to offer long-term prospects for adequate and quality employment and the inclusion of all necessary social benefits and expenditures in the pay system. Therefore, the job security, general well-being of CSO workers and the associated financial stability of their organisations, can still be insufficient and should be considered as priorities.

1.7.

The EESC encourages the European Commission to set up an alert and monitoring permanent mechanism to deal with CSOs’ challenges and threats. Additionally, the Commission should create a unique contact point for CSOs to operationalise the functioning of the mechanism and to allow structured work involving the EESC, other EU institutions and specialised agencies like the European Union Agency for Fundamental Rights (FRA).

1.8.

The EESC proposes updating the European Commission Rule of Law Report methodology to highlight the role of civil society organisations in safeguarding the rule of law, and to bring forward more prominently both their obstacles and the responsibility of Member States to address them.

1.9.

Since 2018, the EESC Fundamental Rights and Rule of Law Group has organised country visits to all EU Member States, during which all aspects of civil society organisation and operation are discussed with civil society actors. The reports resulting from these visits are drafted using a participatory and peer-to-peer method. They could be used as an additional resource to inform the general European Commission assessment of CSOs functioning at national and local levels.

1.10.

While the EESC welcomes the structuring of the Citizens, Equality, Rights and Values program (CERV), and the flexibility of funding to meet existing needs, the allocation of funds is still insufficient and not geared toward offering CSOs the support they deserve in these critical times. The co-funding CERV requirements can severely limit access to funding, and needs to be reassessed and lowered.

1.11.

Special attention should be given to organisations working in critical areas for democracy pursuing watchdog functions, as their functioning is less suited to project-based functioning. In that regard, funding running costs and development (operating grants) should be a priority, be available faster and involve less red tape. On the basis of a calibrated assessment, having more easily accessible need-based financing available, the Commission can better communicate the available opportunities to CSOs.

1.12.

Running costs and development funding of CSOs should be reconfigured to cater for their real and pressing needs. Such financing should lift CSOs’ key workers out of precarity and allow them to benefit from decent and predictable pay. In the face of legal attacks, CSOs should be able to access funds to cover various legal proceedings. Other specific needs should be taken into consideration, on a more flexible basis.

1.13.

The EESC draws attention to the fact that access to EU funds is particularly difficult for smaller organisations operating locally and in more remote areas. In addition to the excessive complexity of the administrative requirements and limited linguistic competences, they are hindered in applying by too low a level of indirect costs that do not reflect real expenditure. Additionally, they are still frequently required to have their own financial contributions. These obstacles and burdens should be directly addressed by the Commission.

2.   General comments

2.1.   Democratic values and institutions. Current challenges

2.1.1.

As indicated in Article 11(2) of the Treaty on the Functioning of the European Union (TFEU), the EU institutions shall maintain an open, transparent and regular dialogue with representative associations and civil society.

2.1.2.

There is an increasing realisation that the EU should be more active and effective in all interrelated areas of democratic values and institutions. The renewed commitment from the European Commission (EC) to advance the protection of democracy (European Democracy Action Plan) (1) fundamental rights (Strategy for the Implementation of the Charter of Fundamental Rights) (2), equality (Union of Equality (3) and non-discrimination (4)), and the rule of law (Rule of Law Reports), is welcomed and necessary. The Council of the EU has recently recognised the civic space’s role in protecting fundamental rights in the EU in its conclusions (5).

2.1.3.

The EC will launch a ‘defence of democracy package’ under the European Democracy Action Plan (6) In the latest Rule of Law Report in 2022, the EC stated that ‘civil society organisations and human rights defenders play an essential role as watchdogs against breaches of the rule of law and actively contribute to fostering the rule of law, democracy and fundamental rights on the ground (7).’ In its Strategy to strengthen the application of the Charter of Fundamental Rights, the EC puts forward four main strands, one of them being ‘empowering civil society organisations, rights defenders and justice practitioners (8).’

2.1.4.

In all these areas, the European Commission acknowledges the key role of Civil Society Organisations (CSOs) in ensuring the maintenance of a robust system of checks and balances, monitoring of decision-making, citizen participation in politics and government, and protection and inclusion of various social groups.

2.1.5.

However, CSOs, especially those working in the area of democracy, fundamental rights, equality and the rule of law, are faced with two major mutually-reinforcing challenges. First, an increasing number of social, political and governmental actors work directly against the democratic values and standards of the EU. Second, the space and opportunities for contesting these trends are constantly decreasing. Faced with increased hostility from the government and other actors, with difficulties to finance other activities and limited traction in mass media and society, CSOs are becoming overburdened and exhausted.

2.1.6.

The pressures on CSOs also come from their role in responding to crises, for example, during the COVID-19 pandemic, during several humanitarian crises on the EU borders or during increased migration as a result of the war in Ukraine. It is CSOs that have been the first to respond, helping the most vulnerable members of our societies, and in return, at least some of them have faced impediments to their normal activities, harassment and withdrawal of public funds.

2.1.7.

Acknowledging serious and increasing challenges in the areas of fundamental rights, rule of law and democracy, we must learn from the EU’s successful efforts. The most direct, accessible and effective support to CSOs working in the field of human rights and democracy is currently granted outside the EU.

2.2.   The continuous shrinking of civic space

2.2.1.

In a previous opinion adopted in 2017, the EESC expressed its serious concern about the shrinking civic space noted in some EU Member States, and the need to directly address both the increasing difficulties in accessing public financing and the role of CSOs in the functioning of European democracy. Then and now ‘a political and legal framework should be put in place at the European and national level to nurture the development of European civil society, whose activities are an integral part of values anchored in fundamental rights (9).’

2.2.2.

According to the United Nations (UN), ‘civic space is the environment that enables people and groups — or “civic space actors” — to participate meaningfully in the political, economic, social and cultural life in their societies’ (10).

2.2.3.

A recent study indicates that shrinking civic space is a result of various pressures, from top to bottom — parties and governments challenge democratic civil society through legislation, policies and practices aiming to dismantle checks and balances in their countries, and bottom-up — conservative civic organisations, quasi-GONGOs (‘Government-organised non-governmental organisations’) and extreme right movements become very active. Pressure can also stem from the corporate sector, for example, through strategic lawsuits against public participation (SLAPPs) (11).

2.2.4.

The vulnerabilities of civil society were also aggravated by the COVID-19 pandemic (12). An EESC study finds that ‘many entities, especially smaller ones and those operating outside big cities, or bringing together specific social groups with a higher proportion of digitally excluded people — for example, older people or people with disabilities suspended their activities’ and that ‘a significant proportion of such organisations have not returned to activity to date’ (13). Social partners and trade unions especially were affected by the increasing pressure to curtail workers’ rights — e.g. the right to strike, or as a result of increased opportunities to control employees during remote working, affecting their privacy rights.

2.2.5.

In the area of fundamental rights, there are additional reasons for concern. The European Commission notes that ‘in recent years, CSOs and rights defenders have also increasingly faced challenges linked to the narrowing of civic space’ and that ‘various legal, administrative and political measures have gradually limited their fundamental freedoms, affecting their ability to carry out activities supporting fundamental rights as strategic partners for the EU and Member States’ (14).

2.3.   Financing the CSOs. Current challenges and obstacles

2.3.1.

The financing of CSOs is at the same time cause, symptom and effect of the shrinking of civic spaces. Limited access to funding is not just a phenomenon in the newest Member States but in all the EU. Limited access can be defined quantitatively, as the absolute or relative decrease of funding but also qualitatively, as the reorientation of funds to other areas or social and community work than the protection of rights, rule of law and democracy.

2.3.2.

Limited access to funding can be a result of legislative and procedural changes that make the working of CSOs more difficult and uncertain. It is also hampered by legal differences between Member States, e.g. regarding moving/setting up new CSOs or their access to tax exemptions. Additionally, reduced revenues for business entities and individuals can also have a downward effect on philanthropy (corporate and private) and can come with restrictions for the receiving CSOs.

2.3.3.

According to FRA, CSOs indicated that the most common hurdles they face are: competition with other CSOs for limited funds (52 %), lack of transparency and fairness in funding allocation (25 %), limited administrative capacity and expertise to apply for funding (24 %), and restrictive eligibility criteria (23 %). In its assessment, the EESC is aware that smaller grassroots organisations face the biggest funding challenges.

2.3.4.

According to the Report by the EESC Fundamental Rights and Rule of Law Group (FRRL Group) (15) on its visits to Romania, Poland, Hungary, France, Austria, Bulgaria and Italy, restrictions on the right of CSOs to access funding represented a worrying trend on the continent, and one that was taking multiple forms. In the next round of discussions organised by the FRRL Group with CSOs from Denmark, Germany, Ireland, Czechia, Spain, Cyprus, and Lithuania, access to funding was a general concern raised in all country visits (16).

2.3.5.

As the EESC Report on the first FRRL Group country visits noted, ‘some CSOs contended that restriction to access to funding was not so much a result of the decrease in the availability of public funding so much as a consequence of the redirection of funding, which was increasingly aimed at CSOs performing social services provision rather than human rights advocacy or monitoring. It was also noted that private donors were more and more active in financing CSOs that did not defend the interests of the common good’ (17).

2.4.   A new architecture of CSO support and financing. Real protection and better access to funding

2.4.1.

Acknowledging the challenges faced by CSOs in the area of fundamental rights, the rule of law and democracy to finance their activities, and the increased risk to compromise their democratic mission, the EESC proposes a new architecture of financing, based on the reorganisation of the current procedures and programs.

2.4.2.

At the core of it is the realisation that the future of the EU also depends on the existence of a vibrant civil society that is capable of monitoring and impacting decision-making, especially when it departs from the standards of democratic governance. Second, the EESC proposes that the EU takes full responsibility for the protection of CSOs and the creation of a system allowing them to operate while facing financial uncertainty, marginalisation and governmental soft or hard repression. Thirdly, CSOs at national level should be supported to participate in the programming and monitoring of EU funding by providing them with technical support (access to information, knowledge, skills, etc.), funding and protection.

2.4.3.

As in several other opinions, the EESC advises the European Commission to draft an EU Civil Society Strategy in which it would outline a comprehensive vision of civil society development, its role in upholding our democratic systems and the way to work at all levels for the benefit of citizens and communities.

2.5.   Real protection

2.5.1.

The protection of CSOs must be updated and raised to a much higher level of priority. The EU should monitor closely all legislative and administrative actions which lead to the weakening of CSOs and to obstacles in fulfilling their democratic mission. This refers to difficulties to be registered or operating, unreasonable administrative burdens associated with their activities, limitations in their financial operations or access to funding, harassment from State authorities, prevention of taking legal action, or lack of protection in the face of smearing, attacks and defamation. A positive example in this respect is the proposal for a Directive on protecting persons who engage in public participation from manifestly unfounded or abusive court proceedings (Strategic lawsuits against public participation, SLAPPs).

2.5.2.

The civil society protection objectives should be treated as key democratic conditionality and be built into the EC planning, especially of the disbursement of funds. The EESC considers justified the option of the EC to link the Recovery and Resilience Facility to Member State reforms of the judiciary, anti-corruption frameworks, public administration and digitalisation of their justice systems (18). A link to the quality of civic space and the way civil society is treated also needs to be operationalised.

2.5.3.

The section ‘Civil Society Organisations as essential actors for the rule of law’ from the European Commission Rule of Law Report, should be expanded and more detailed (19). The EC should formulate detailed recommendations dedicated to particular Member States and follow up on their implementation. The timeline for the collection of inputs to the report and the publication of its final version should be better aligned with the realities of CSOs’ daily operations (it setting respective dates over the end of year holidays and summer should be avoided).

2.5.4.

Documents already exist that could guide the building of the protection package proposed by the EESC. The Council of Europe issued two recommendations on the regulation of civil society, covering key aspects of their organisation and operation (20).

2.5.5.

Comprehensive and comparative assessments are also available. The Index compiled by CIVICUS is a good example of monitoring practice, identifying five types of civic spaces: open, narrowed, obstructed, repressed, and closed (21). The European excellent academic and policy expertise pools can also be mobilised to further advance a detailed assessment of the functioning of CSOs at all levels. In this respect, the EESC recommends making the functioning and activity of CSOs a key area of research in social sciences, to be funded through various programs and actions (22).

2.6.   Better access to funding

2.6.1.

With regards to EU financing, the current ‘Citizens, Equality, Rights and Values’ (CERV) programme is a step forward in the right direction, having allocated a significantly larger budget than the previously available one in the domain. Provision for grants to support capacity building of CSOs, and the funding of their running costs and development, is also a necessary adjustment to meet the real needs of organisations.

2.6.2.

However, the allocation of funds to CSOs under the CERV programme is still insufficient and not geared toward offering CSOs the support they deserve in these critical times. The EC needs to move towards a more proactive and calibrated approach. First, it needs a more fine-grained assessment of the severity of obstacles and challenges at the national level. CSOs from the countries where the pressures are higher and more immediate should have larger sums earmarked, especially when there is an active and coordinated government attempt to weaken and marginalise them.

2.6.3.

While the EESC welcomes the structuring of the CERV program and the flexibility of funding to meet existing needs, it is still concerned that very active CSOs, especially those playing a watchdog role, may not fit into these priorities and access funds necessary to pursue their indispensable role.

2.6.4.

The EESC welcomes the fact that the European Commission work programme for 2023-2024, indicates that the Commission will continue to adjust and innovate to meet the needs on the ground, for example granting financial support to third parties, commonly known also as the cascading grants to intermediaries, to build the capacity of and regrant funds to local civil society or financing capacity building and awareness on the Charter (23).

2.6.5.

The EESC reiterates a key recommendation from a previous opinion: in order to improve access to financing for the smallest organisations and the most disadvantaged sectors of society, the European Commission should provide for a variety of financing arrangements and further simplify administrative formalities (including related to application and reporting), revising unrealistic unit costs and lump sums (to also recognise effects of inflation), providing training and guidelines on the implementation of contracts and financial obligations, while ensuring consistent interpretation by its various branches of the Regulation on the financial rules (24). The EESC also encourages the European Commission to enlarge overhead levels that CSOs can use for their operational costs (up to 20 % of the grants) and to limit co-funding rates for intermediaries. Project-grant management and spending rules should be avoided in relation to core funding.

2.6.6.

In its 2017 Opinion on the financing of CSOs, the EESC put forward the proposal for the European Commission ‘to establish a European fund for democracy, human rights and values within the EU, equipped with an ambitious budget, directly open to CSOs across Europe and managed independently, similarly to the European Endowment for Democracy, with the participation of representatives of the EESC.’ We reiterate our support for such an instrument, emphasising the pressing need for it and the indispensable easing of access to it by EU CSOs.

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(1)  Opinion of the European Economic and Social Committee on ‘Communication from the Commission to the European Parliament, the Council, the European Economic and Social Committee and the Committee of the Regions on the European Democracy Action Plan’ (COM(2020) 790 final) (OJ C 341, 24.8.2021, p. 56).

(2)  Opinion of the European Economic and Social Committee on ‘Communication from the Commission to the European Parliament, the Council, the European Economic and Social Committee and the Committee of the Regions — Strategy to strengthen the application of the Charter of Fundamental Rights in the EU’ (COM(2020) 711 final) (OJ C 341, 24.8.2021, p. 50).

(3)  Opinion of the European Economic and Social Committee on ‘A Union of equality: EU anti-racism action plan 2020-2025’ (COM(2020) 565 final) (OJ C 286, 16.7.2021, p. 121).

(4)  Opinion of the European Economic and Social Committee on Improving equality in the EU (own-initiative opinion) (OJ C 75, 28.2.2023, p. 56).

(5)  Fundamental rights: Council approves conclusions on the role of the civic space.

(6)  Commission work programme 2023. A Union standing firm and united. Strasbourg, 18.10.2022 (COM(2022) 548 final), page 12.

(7)  European Commission, 2022 Rule of Law Report. The rule of law situation in the European Union, Luxembourg, 13.7.2022, (COM(2022) 500 final), page 25.

(8)  European Commission, Strategy to strengthen the application of the Charter of Fundamental Rights in the EU, Brussels, 2.12.2020, (COM(2020) 711 final).

(9)  Opinion of the European Economic and Social Committee on “Financing of civil society organisations by the EU” (own-initiative opinion) (OJ C 81, 2.3.2018, p. 9), points 1.2 and 1.3.

(10)  United Nations, Guidance Note on Protection and Promotion of Civic Space, September 2020.

(11)  Negri, G. and Pazderski, F. 2021, Mapping shrinking civic space in Europe, Civitates.

(12)  Opinion of the European Economic and Social Committee on ‘The impact of COVID-19 on fundamental rights and the rule of law across the EU and the future of democracy’ (own-initiative opinion) (OJ C 275, 18.7.2022, p. 11).

(13)  European Economic and Social Committee, The implications of the COVID-19 pandemic on fundamental rights and civic space, 2022, page 3.

(14)  A thriving civic space for upholding fundamental rights in the EU. 2022 Annual Report on the Application of the EU Charter of Fundamental Rights. Brussels, 6.12.2022 (COM(2022) 716 final).

(15)  https://www.eesc.europa.eu/en/sections-other-bodies/other/group-fundamental-rights-and-rule-law/frrl-trends-eu-member-states

(16)  European Economic and Social Committee, Fundamental Rights and the Rule of Law. National developments from a civil society perspective, 2020-2021, September 2022, page 11.

(17)  European Economic and Social Committee, Fundamental Rights and the Rule of Law. National developments from a civil society perspective, 2018-2019. June 2020, page 11.

(18)  2022 Rule of Law Report. The rule of law situation in the European Union, Luxembourg, 13.7.2022, (COM(2022) 500 final), page 1.

(19)  2022 Rule of Law Report. The rule of law situation in the European Union, Luxembourg, 13.7.2022, (COM(2022) 500 final), pages 25.

(20)  Recommendation CM/Rec(2007)14 of the Council of Europe Committee of Ministers to member states on the legal status of non-governmental organisations in Europe; Recommendation CM/Rec(2022)6 of the Committee of Ministers to member States on protecting youth civil society and young people, and supporting their participation in democratic processes.

(21)  CIVICUS Monitor. Tracking civic space.

(22)  Opinion of the European Economic and Social Committee on ‘Financing of civil society organisations by the EU’ (own-initiative opinion) (OJ C 81, 2.3.2018, p. 9), point 1.12.

(23)  Annex to the Commission Implementing Decision on the financing of the Citizens, Equality, Rights and Values programme and the adoption of the work programme for 2023-2024, page 4.

(24)  Opinion of the European Economic and Social Committee on ‘Financing of civil society organisations by the EU’ (own-initiative opinion) (OJ C 81, 2.3.2018, p. 9), point 1.16.