(1)

Given recent major geopolitical and economic events that have reshaped some of the Union’s strategic political priorities, it is necessary to provide for more structural possibilities to allow Member States to address those pressing strategic geopolitical challenges and to refocus their resources on newly emerging priorities.

(2)

The main objectives of the European Social Fund Plus (ESF+), established by means of Regulation (EU) 2021/1057 of the European Parliament and of the Council (4), are to support Member States and regions to achieve social inclusion and social cohesion, to activate the labour market, and to deliver on the principles and the headline targets of the European Pillar of Social Rights. The reprogramming of resources under the ESF+ should not undermine its social approach, but should strengthen its capacity to combat inequality.

(3)

In its opinion of 6 May 2025 on the legislative proposal forming the basis for this Regulation, the European Court of Auditors stressed that cohesion policy is often used as an emergency response tool, which risks undermining its primary longer-term aims and objectives. Therefore, it is essential to ensure that any measures taken in the context of emergencies do not obstruct the objectives of cohesion policy.

(4)

The Union and its Member States continue to show that they are able to react rapidly to geopolitical events and that they are willing to use sufficient financial resources towards strengthening the defence industry of the Union. At the same time, it is of utmost importance to continue to invest in the social objectives of the Union through the ESF+, as social cohesion is a cornerstone of the Union’s democratic and societal resilience, which is essential for the purpose of facing threats of aggression.

(5)

The Joint White Paper of the High Representative for Foreign Affairs and Security Policy and the Commission of 19 March 2025 on European Defence – Readiness 2030 paves the way for a true European defence union, including by suggesting to Member States to heavily invest in defence and cybersecurity, including dual-use capabilities and civil preparedness, which should be carried out together with social spending, creating employment and up-skilling and re-skilling opportunities. In that regard, the Commission communication of 5 March 2025 entitled ‘The Union of Skills’ (the ‘Union of Skills Communication’) sets out actions to address skills gaps and skills shortages in the Union, including through the strengthened and streamlined Pact for Skills, referred to in that communication, as well as its large-scale partnerships in particular the Large Scale Partnership for Aerospace and Defence. In that context, it is appropriate to incorporate incentives into the ESF+ with a view to facilitating the development of skills in the defence industry. In order to provide more flexibility for Member States to reallocate resources to the development of skills in the defence industry, the amounts allocated to such development should not be subject to thematic concentration requirements, but should be taken into account when contributing to such requirements.

(6)

The ESF+ can be used to support the adaptation of workers, enterprises and entrepreneurs to change. In line with the decarbonisation measures proposed in the Commission communication of 26 February 2025 entitled ‘The Clean Industrial Deal: A joint roadmap for competitiveness and decarbonisation’ and in order to further facilitate industrial adjustment linked to the decarbonisation of production processes and products, the ESF+ should facilitate skilling, job maintenance and quality job creation throughout the decarbonisation process, by providing flexibility in the implementation of that process. This should be carried out in line with the objective of providing lifelong opportunities to regularly upskill and reskill people set out in the Union of Skills Communication, including through a Skills Guarantee. Particular consideration should be given to the specific needs and circumstances of less developed regions and rural areas, which should benefit from the green transition, and to ensuring their integration into the Union’s broader economic, social and environmental development.

(7)

In light of the importance of horizontal enabling conditions applicable to all specific objectives and the criteria necessary for the assessment of their fulfilment, within the meaning of Article 15(1), second subparagraph, of and Annex III to Regulation (EU) 2021/1060 of the European Parliament and of the Council (5), for the effective and efficient use of the overall Union support granted by those Union Funds and the need to ensure the practical effect of those Union Funds, the amounts exceeding the flexibility amount referred to in Article 86(1), second subparagraph, of that Regulation, which correspond to specific objectives that are subject to a negative assessment by the Commission on the basis of the application of those horizontal enabling conditions, should not be subject to a programme amendment or transfer on the basis of the new priorities and flexibility provided for in this Regulation. Such a proportionate measure constitutes a necessary incentive, intended to ensure that Member State law and practice continues to comply with the horizontal enabling conditions and that the expenditure covered by the Union Funds meets the Union’s objectives. Since Regulation (EU, Euratom) 2020/2092 of the European Parliament and of the Council (6) is of horizontal application, the same requirement should apply to the amounts corresponding to commitments suspended by measures adopted on the basis of that Regulation. Amounts within the flexibility amount referred to in Article 86(1), second subparagraph, of Regulation (EU) 2021/1060 and corresponding to the specific objectives subject to a negative assessment by the Commission on the basis of the application of the horizontal enabling conditions can be subject to a programme amendment or transfer on the basis of new priorities, provided that such new priorities comply with the objectives pursued by the horizontal enabling conditions.

(8)

The ESF+ provides for support for investments contributing to the objectives of the Strategic Technologies for Europe Platform (STEP), which was established by Regulation (EU) 2024/795 of the European Parliament and of the Council (7). STEP aims to strengthen the Union’s technological leadership and the development of skills in the Union. In order to provide further incentives for investments from the ESF+ in those critical fields, the possibility for Member States to receive higher pre-financing for related programme amendments should be extended. The priorities which support investments contributing to STEP objectives under a request for a programme amendment that was submitted to the Commission by 31 March 2025 are to receive the exceptional one-off pre-financing applicable at the time of the submission of that request.

(9)

In order to enable Member States to carry out meaningful and just reprogramming, without diverging from the main objectives of the ESF+, and to focus resources on the strategic Union priorities referred to in this Regulation, without causing further delays in the implementation of programmes, it is appropriate to provide for further flexibility. The mid-term review serves as an opportunity to address emerging social aspects of strategic challenges and new priorities without prejudice to other Union legal acts or to the next multiannual financial framework. Member States should benefit from additional time to complete their assessment of the outcome of the mid-term review and their submission of related requests for programme amendments.

(10)

Russia’s war of aggression against Ukraine is having a disproportionately heavy impact on NUTS level 2 regions bordering Russia, Belarus or Ukraine, resulting in job losses, less economic activity and social exclusion. In order to accelerate the implementation of cohesion policy programmes and alleviate the pressure on national budgets as well as to inject the liquidity necessary for the implementation of key investments, an additional one-off pre-financing payment from the ESF+ should be paid for programmes. Because of the adverse impact of Russia’s war of aggression against Ukraine, the pre-financing percentage should be further increased for certain programmes covering one or more NUTS level 2 regions bordering Russia, Belarus or Ukraine. In order to encourage re-programming towards key priorities in the context of the mid-term review, the additional one-off pre-financing should be available only where a certain threshold for the reallocation of financial resources to specific crucial priorities is reached.

(11)

Furthermore, to take account of the time needed to refocus investments and to allow the best use of available resources, the deadlines for the eligibility of expenditure and the decommitment rules as well as other deadlines related to the performance framework, financial management, reporting and evaluation requirements should be adjusted for programmes carrying out a reallocation of resources to strategic priorities.

(12)

It should be possible to apply a higher co-financing rate to priorities in programmes covering one or more NUTS level 2 regions bordering Russia, Belarus or Ukraine, given the adverse impact of Russia’s war of aggression against Ukraine on those NUTS level 2 regions.

(13)

Skills development and the training of young talent as well as entrepreneurs are essential for job creation, and institutions working on skills creation and uptake, in particular vocational education and training institutes, should cooperate closely to align with labour market needs. In that context, Member States should also be able to allocate resources to attract young talent and entrepreneurs, particularly to rural and less developed regions, through incentives and targeted training.

(14)

When amending programmes, the Member States should include, in relation to the dedicated priorities, with the close and meaningful participation of the social partners, obligations on the beneficiaries to respect working and employment conditions in accordance with the applicable Union and national law, conventions of the International Labour Organization and collective agreements.

(15)

To support Member States in their swift and correct reprogramming, the Commission should provide timely and clear technical clarifications and support to managing authorities, including through a structured system, by answering technical, legal and procedural questions, in particular with regard to measures introduced by this Regulation.

(16)

Since the objectives of this Regulation, namely to address the social aspects of strategic challenges, refocus investments on critical new priorities and simplify and accelerate policy delivery, cannot be sufficiently achieved by the Member States but can rather, by reason of its scale and effects, be better achieved at Union level, the Union may adopt measures, in accordance with the principle of subsidiarity as set out in Article 5 of the Treaty on European Union. In accordance with the principle of proportionality, as set out in that Article, this Regulation does not go beyond what is necessary in order to achieve those objectives.

(17)

Regulation (EU) 2021/1057 should therefore be amended accordingly.

(18)

Given the urgent need to enable crucial investments in skills in the defence industry as well as in adaptation to change linked to decarbonisation in the context of pressing strategic geopolitical challenges, this Regulation should enter into force on the day following that of its publication in the Official Journal of the European Union,

(1)

the following article is inserted:

(*1)  Regulation (EU) 2024/795 of the European Parliament and of the Council of 29 February 2024 establishing the Strategic Technologies for Europe Platform (STEP), and amending Directive 2003/87/EC and Regulations (EU) 2021/1058, (EU) 2021/1056, (EU) 2021/1057, (EU) No 1303/2013, (EU) No 223/2014, (EU) 2021/1060, (EU) 2021/523, (EU) 2021/695, (EU) 2021/697 and (EU) 2021/241 (OJ L, 2024/795, 29.2.2024, ELI: http://data.europa.eu/eli/reg/2024/795/oj).’;"

(2)

Article 12a is amended as follows:

(3)

the following articles are inserted: