EXECUTIVE SUMMARY

The European Globalisation Adjustment Fund (EGF) was set up in 2007 to support workers who lose their jobs as a result of globalisation and changing trade patterns. The Fund was further adapted to support dismissals resulting from the global financial and economic crisis.

The Fund aims at a better distribution of the benefits of globalisation by helping displaced workers who experience hardship in difficult transitions, to adapt their skills and to find new jobs. In regions of high youth unemployment, the EGF may provide support for young people not in employment, education or training (NEETs).

The EGF co-finances up to 60% of the cost of measures proposed by the Member States who submit applications for EGF support. Measures included personalised job-search assistance and guidance, a variety of tailor-made training and upskilling opportunities, support to entrepreneurship and business creation, andtemporary financial incentives and allowances.

The present report provides an overview of the EGF activities and results in 2019 and 2020.

Ø During this period eight applications were submitted by six Member States of which one was withdrawn later one. The eight applications covered a total of EUR 34.6 million (national and EGF contribution), targeting 10 505 workers and 330 young people not in employment, education or training. The largest numbers of workers were in the air transport sector followed by warehousing and support activities for transportation, and manufacture of motor vehicles.

Ø The European Parliament and the Council adopted one decision 1 to mobilise the EGF funding for a total amount of EUR 2 million to support 500 beneficiaries.

Ø Member States reported back on 16 EGF cases adopted between 2016 and 2018. The results showed that on average 56% of the workers who participated in the measures had found new jobs by the end of the implementation period. Particularly high reintegration rates were observed in the following cases: Microsoft (Finland) 92%, Retail (Finland) 84%, Financial service activities (Netherlands) 78%, and Norte Centro Lisboa wearing apparel (Portugal) 77%.

At the end of 2020, a political agreement on the EGF Regulation for 2021-2027 was found. The Regulation entered into force in spring 2021. 2 It expands the use of the Fund so that it can intervene more effectively to support more workers who have lost their jobs. The EGF will offer support to workers not only in the case of major structural changes in world trade patterns due to globalisation and a global financial and economic crisis, but also due to other reasons such as automation, digitalisation or transition to low-carbon economy. This takes into account the new challenges of the evolving world of work.

TABLE OF CONTENTS

1. Introduction

2. Analysis of EGF activities in 2019 and 2020

2.1. Applications submitted

2.1.1. Applications submitted by cause of dismissals and intervention criterion

2.1.2. Applications submitted by sector

2.1.3. Applications submitted by number of targeted beneficiaries

2.1.4. Applications submitted by amount requested

2.1.5. Applications submitted by amount requested per beneficiary

2.2. Decisions adopted and contributions granted

2.2.1. Actions funded with EGF assistance

2.2.2. Complementarity with actions funded by the European Social Fund (ESF)

2.3. Applications not approved

2.4. Results achieved by the EGF

2.4.1. Summary of the results reported in 2019 and 2020

2.4.2. Reintegration rate for assisted beneficiaries

2.4.3. Qualitative assessment of the final reports submitted in 2019 and 2020

2.5. Financial execution

2.5.1. EGF contributions

2.5.2. Technical assistance

2.5.3. Irregularities reported

2.5.4. Winding-up of EGF financial contributions

2.6. Technical assistance activities undertaken by the Commission

2.6.1. Information and publicity: internet website

2.6.2. Meetings with national authorities and EGF stakeholders

2.6.3. Electronic data exchange system (SFC2014)

2.6.4. EGF ex post evaluation 2014 -2020

3. EGF Regulation 2021-2027

1. Introduction

Through the European Globalisation Adjustment Fund (EGF) 3 the EU demonstrates solidarity with, and support to workers made redundant, and to the self-employed persons whose activity has ceased, as a result of major structural changes in world trade patterns due to globalisation or a global economic and financial crisis.

To help redundant workers find new jobs, the EGF co-finances active labour market measures implemented by Member States. It supplements national measures in cases of sudden collective redundancies, caused by the aforementioned reasons, by providing a more personalised and targeted approach to the most vulnerable dismissed workers.

In line with Article 19 of 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) 4 , the Commission is addressing the present report to the European Parliament and the Council, providing a quantitative and qualitative assessment of EGF activities over the last two years.

The report focuses on the results achieved by the EGF and, in particular, contains information on:

·applications submitted;

·decisions adopted;

·actions funded, including their complementarity with actions funded by other Union instruments, in particular the European Social Fund (ESF);

·statistics on the reintegration rate for beneficiaries per Member State;

·winding-up of financial contributions; and

·applications rejected due to non-eligibility.

The report concludes by presenting the main findings of the study supporting the ex post evaluation covering the period 2014-2020 and the main features of the revised EGF Regulation for 2021-2027.

2. Analysis of EGF activities in 2019 and 2020

2.1. Applications submitted

In 2019 and 2020, the Commission received eight applications from six Member States 5 : Belgium, Spain, Estonia, Germany, the Netherlands and Finland. The eight applications covered a total of EUR 34.6 million (national and EGF contribution), targeting 10 505 workers and 330 young people not in employment, education or training. All of them had already applied for EGF funding. Details of the applications are set out in Table 1 below .

Table 1: Applications submitted in 2019 and 2020

Out of these eight applications, Member States submitted five at the very end of 2020 in the wake of the COVID-19 outbreak which is having a major impact on Member States’ economies. Four Member States (Estonia, Belgium, Finland and the Netherlands) 6 submitted applications related to redundancies in three sectors particularly affected by the COVID-19 outbreak: air transportation and tourism-related activities. In addition, Spain submitted an application under the trade-related globalisation criterion (EGF/2020/006 ES/Cataluña automotive). However, Spain withdrew its application on 4 May 2021 and is not included in the following analysis.

2.1.1. Applications submitted by cause of dismissals and intervention criterion

The seven applications submitted in 2019 and 2020 were covered by Regulation (EU) No 1309/2013, which applies to dismissals resulting from:

vMajor structural changes in world trade patterns due to globalisation

Three applications were submitted under the trade criterion, of which one (EGF/2020/001 ES/Galicia shipbuilding ancilliary sectors) was justified by exceptional circumstances 7 .

vThe effects of the global economic crisis

Four applications were submitted because of the global economic crisis, of which also one (EGF/2020/002 EE/Estonian tourism industry) was justified by exceptional circumstances 8 .

2.1.2. Applications submitted by sector (NACE Rev. 2) 9

The seven applications submitted were related to redundancies in 22 different sectors.

Three applications - from Belgium, Estonia and Spain - belonged to more that one activity sector.

The sectors concerned were as follows:

1)Manufacture of basic metals (two applications)

2)Manufacture of fabricated metal products, except machinery and equipment

3)Manufacture of other transport equipment

4)Other manufacturing

5)Repair and installation of machinery and equipment

6)Specialised construction activities

7)Wholesale and retail trade and repair of motor vehicles and motorcycles

8)Retail trade

9)Land transport and transport via pipelines

10)Water transport

11)Air transport (three applications)

12)Warehousing and support activities for transportation (two applications)

13)Accommodation

14)Food and beverage service activities

15)Other professional, scientific and technical activities

16)Rental and leasing activities

17)Travel agency, tour operator and other reservation service and related activities

18)Services to buildings and landscape activities

19)Creative, arts and entertainment activities

20)Libraries, archives, museums and other cultural activities

21)Gambling and betting activities, and

22)Sports activities and amusement and recreation activities.

For the first time since the start of the EGF, applications were submitted for the following sectors (number of the NACE sector is in brackets):

·Wholesale and retail trade and repair of motor vehicles and motorcycles (45)

·Water transport (50)

·Warehousing and support activities for transportation (52)

·Accommodation (55)

·Other professional, scientific and technical activities (74)

·Travel agency, tour operator and other reservation service and related activities (79)

·Services to buildings and landscape activities (81)

·Creative, arts and entertainment activities (90)

·Libraries, archives, museums and other cultural activities (91)

·Gambling and betting activities (92)

·Sports activities and amusement and recreation activities (93)

The greatest number of workers targeted were in the air transport sector (1 715), followed by warehousing and support activities for transportation (1 340) and accommodation (775). (see Chart 1 below)

Chart 1: Number of targeted workers per sector* (NACE Rev. 2) in 2019–2020

*Four sectors (77 10 , 91, 92 and 93) are not included in the chart because the number of workers dismissed in these sectors (Estonian case) was unknown at application stage. The number of targeted workers per sector in two multi-sector cases (Estonia and Spain) were estimated based on the number of dismissed workers.

2.1.3. Applications submitted by number of targeted beneficiaries

The seven applications submitted in 2019 and 2020 related to 16 387 redundancies. The total number of beneficiaries (workers and NEETs) targeted for EGF support was 9 935. Of the 9 935 targeted beneficiaries, 9 605 were workers made redundant and 330 were NEETs. (see Table 1 above) Estonia requested EGF support for the greatest number of workers (5 060), followed by Belgium (1 868) and the Netherlands (1 201). Belgium’s application included 330 NEETs who were also targeted for support. The average number of targeted beneficiaries per application was 1 419. (see Chart 2 below)

Chart 2: Number of targeted beneficiaries per Member State in 2019–2020

Number of applications submitted is in brackets.

*2 applications from BE : EG/2019/001 BE/Carrefour and EGF/2020/005 BE/Swissport

Total number of targeted beneficiaries: 9 935

Average number of targeted beneficiaries: 1 419

Among the workers targeted, 55% were men, 62% were aged 25-54 and 88% were EU citizens. However, the profile of workers by gender differs significantly across cases. The Belgian application (retail) targeted women to a level of 71% and the Estonian application (tourism) to a level of 61%. In contrast, the German and Spanish applications covered 4% and 6% respectively; these applications were related to manufacturing sectors that are traditionally ‘male-dominated’ (metals and vehicles).

Differences in the number of workers affected by a redundancy and the number targeted for EGF support can arise because the Member State may decide to focus on specific groups such as the most vulnerable workers, those facing exceptional difficulties in the labour market and/or those most in need of assistance. The standard support available for redundant workers in Member States might, in some cases, be enough for a quick reintegration into employment or, in certain cases, workers might choose early retirement.

Chart 3: Profile of targeted workers by gender and per application

Chart 4: Profile of targeted workers by gender

Chart 5: Profile of targeted workers by citizenship

Chart 6: Profile of targeted workers by age

2.1.4. Applications submitted by amount requested

The EGF financial contribution complements Member States measures at national, regional and local level. The applicant Member State has to ensure that the specific measures receiving an EGF financial contribution do not receive other financial support from the EU budget and that they comply with State aid rules. The measures supported by the EGF do not replace measures that are the responsibility of companies by virtue of national law or collective agreements.

Each Member State applying for EGF support must design a coordinated package of measures that best fits the targeted beneficiaries' profiles, and decide on the amount of assistance to request. Regulation (EU) No 1309/2013 sets the maximum EGF co-financing rate at 60%.

A total amount of EUR 19 733 416 was requested for EGF support for the seven cases. Belgium requested the highest amount (EUR 5 351 252) for two applications, followed by the Netherlands (EUR 5 019 218) and Estonia (EUR 4 474 480) each for one application. The EGF-requested contributions ranged from EUR 1 081 706 to EUR 5 019 218 with an average of EUR 3 288 903 per Member State and EUR 2 819 059 per application.

Chart 7: Total EGF amounts (in EUR) requested per Member State in 2019–2020

Number of applications submitted is in brackets.

Total EGF amount requested: EUR 19 733 416

Average EGF amount requested per MS: EUR 3 288 903

2.1.5. Applications submitted by amount requested per beneficiary

Regulation (EU) No 1309/2013 does not limit the total amount requested. The amount requested per targeted beneficiary can vary according to the situation in the affected labour market, the individual circumstances of the targeted beneficiaries, the measures already provided by the Member State, and the cost of providing the services in the Member State concerned.

The above explains why the proposed amounts of EGF support per beneficiary in 2019 and 2020 varied from EUR 884 to EUR 4 179, with an average of EUR 1 986. The highest average amount per beneficiary was requested by the Netherlands (EUR 4 179), and the lowest by Estonia (EUR 884).

Chart 8: EGF amount (in EUR) requested per beneficiary and per Member State in 2019–2020

Number of applications submitted is in brackets.

Average EGF amount requested per beneficiary: EUR 1 986

2.2. Decisions adopted and contributions granted

In 2019-2020, the European Parliament and Council adopted one decision to mobilise EGF funding. The EGF co-financing granted was in total EUR 2 054 400 for targeted workers dismissed in shipbuilding ancillary sectors in Spain. The application related to 960 workers redundant in six sectors and 38 enterprises located in the NUTS 2 level region of Galicia. Of the 500 targeted workers expected to participate in the measures (representing 52% of the workers dismissed), 94% were men, 78% were aged 30-54 and 97% were EU citizens.

2.2.1. Actions funded with EGF assistance

Under Article 7 of Regulation (EU) No 1309/2013, a financial contribution from the EGF can support active labour market measures that form part of a coordinated package of personalised services designed to facilitate the reintegration of the targeted beneficiaries - and, in particular, disadvantaged, older and young unemployed people - into employment or self-employment.

The active employment measures approved in 2020 for EGF contribution consisted mainly of the following:

·occupational guidance;

·intensive personalised job-search assistance and job matching;

·a variety of retraining, upskilling and vocational training; horizontal and soft-skills training and entrepreneurship training;

·counselling and mentoring for re-employment and mentoring during the initial phase of the new job;

·outplacement incentives; and

·a variety of allowances (job search, training) and contributions (commuting, carers of dependant people).

When designing their support packages, Member States took into account the background, experiences and educational level of individual beneficiaries, their ability to be mobile, and the current or expected job opportunities in the regions concerned.

2.2.2. Complementarity with actions funded by the European Social Fund (ESF)

The EGF aims to increase employability and facilitate the reintegration of the targeted beneficiaries into employment through active labour market measures. The Fund therefore complements the ESF, which is the major EU instrument for promoting employment.

The complementarity of the two Funds lies in their ability to address these issues from two different time perspectives. The EGF provides support for redundant workers or the self-employed in response to a specific, large-scale mass redundancy which happened within a short period. It offers concrete European support in a crisis situation.

The EGF allows Member States to offer targeted beneficiaries better tailor-made and more in-depth assistance, including measures to which they would not normally have access (e.g. second- or third-level education). The EGF provides an opportunity to design personalised services for the needs of individual redundant workers, going well beyond standard courses and actions. In contrast, ESF support usually targets a wider population (both those in and out of work).

Futhermore, the workers deemed to have benefitted most from the EGF assistance were those belonging to the most vulnerable groups of affected workers, including older workers, low-skilled workers, those with a migrant background, and women (especially single mothers). The EGF enables Member States to provide a better counsellor-beneficiary ratio and longer-time support. This increases the beneficiaries' prospects of improving their situation.

The ESF supports – in an anticipatory manner - strategic, long-term goals (e.g. increasing human capital and managing change) through multiannual programmes.

EGF and ESF measures are sometimes used by Member States to complement each other to provide both short-term and longer-term solutions. At case level, the EGF normally builds on existing national or ESF measures by topping them up or by offering different, additional measures. The decisive criterion is the potential of available instruments to help the targeted beneficiaries, and it is up to Member States to select, and to programme, the instruments and actions best suited to achieving the desired objectives.

In line with the principle of subsidiarity, the decision on whether to apply for ESF or EGF funding is made at Member State level. It is for Member States to manage the complementarity between the two Funds in the best possible manner given the local conditions prevailing at the time.

As laid down in Article 9(5) of Regulation (EU) No 1309/2013, all Member States must put in place the necessary mechanisms to avoid any risk of double funding from EU financial instruments. In most Member States, the ESF Managing Authority is also responsible for the implementation of the EGF. It gives Member States the possibility to ensure for complementarity of the various interventions.

2.3. Applications not approved

During the 2019-2020 period, one application submitted by Belgium (EGF/2019/001 BE/Carrefour) was rejected because the Council 11 considered that the link between the redundancies and major structural changes in world trade patterns due to globalisation, as required in Article 2(a) of Regulation No 1309/2013, was not sufficiently demonstrated. The European Parliament fully supported the Commission’s proposal, still the budgetary authority did not reach an agreement in this case.

2.4. Results achieved by the EGF

The main sources of information on the results achieved by the EGF are the Member State final reports, which are to be submitted no later than six months after the end of implementation. These are supplemented by information shared by Member States in direct contacts with the Commission, during meetings and conferences and by evaluation and audit work. The main results and data reported by Member States in 2019 and 2020 are summarised in this section and in Table 2.

2.4.1. Summary of the results reported in 2019 and 2020

In 2019 and 2020, the Commission received 16 final reports for EGF co-financed cases implemented by 11 Member States from July 2016 to June 2020. All these cases were subject to the ex post evaluation 12 .

These final reports showed that 6 235 workers (56% of the workers assisted) and 112 NEETs, thus a total of 55% of the 11 511 EGF beneficiaries, had found new jobs by the end of the EGF implementation period (5 695 employees and 652 as self-employed). Approximately 5% of beneficiaries were still in education or training, 27% were unemployed or inactive for various reasons, and for 13% the employment status was not available. The average beneficiary reach rate (i.e. the number of beneficiaries assisted through the EGF compared with those initially targeted by the measures) was 74%, and varied considerably from 9% to 100%.

Member States final reports outline how displaced workers are given personalised and tailored measures that help guide them towards alternative routes of employment. These reports also confirmed that the EGF adds value to what the Member States could otherwise do to help targeted beneficiaries to find new jobs and to reposition themselves on the labour market.

Table 2: Final reports received in 2019 and 2020

* The labour market status of the beneficiaries provided in this table reflects as a matter of principle the situation at the end of the implementation period.
** Inactive means that people are not available for the labour market any longer for various personal reasons, for example retirement

2.4.2. Reintegration rate for assisted beneficiaries

Based on the final reports received in 2019 and 2020, on average 55% of the beneficiaries took up new employment within six months after the end of an intervention from the EGF. However, the reintegration rate of the assisted workers varied from 28% (in France) to 92% (in Finland). See Table 2.

According to the final reports, EGF beneficiaries tend to have a relatively lower than average educational attainment, thus fewer transferrable skills. This, in normal circumstances, reduces their employment opportunities and makes them more vulnerable on the labour market. Moreover, the EGF aims to offer support especially in regions that have been hit particularly hard by restructuring events. Therefore, the average rate of 56% of assisted workers reintegrated at the end of the implementation period, compared with 47% in the previous programming period, is an encouraging result. However, this improvement needs to be taken with caution as the implementation period for 2014-2020 (24-months or longer if the implementation started early) is only partially comparable with the one of the previous programming period 2007-2013 13 .

Of the final reports received in 2019 and 2020, only three cases targeted NEETs. By the time the final reports were submitted, 29% of the NEETs helped by the EGF were employed or self-employed and another 11% had returned to education.

The mid-term evaluation 14 found that there was no correlation between the expenditure on a case and an improvement in the re-employment rate. Based on the comments provided by Member States in their final reports the reintegration is influenced by the following factors:

ØThe economic prosperity and absorption capacities of local and regional labour markets. Hence, the reintegration rate may differ considerably depending on the economic sector and the area concerned.

ØEducation and skills of the displaced workers.

ØResponsiveness of the measures as regards the needs of the displaced workers.

ØDegree to which beneficiaries or their representatives are involved from the very start in designing and implementing EGF assistance.

ØMember States' institutional capacity and experience to provide assistance in restructuring events.

Furthermore, the reintegration rate is recorded at the end of the implementation period. Consequently, it provides a snapshot of the beneficiaries' employment situation at the moment the data were collected.

The above-mentioned factors have a major influence on the number of beneficiaries who find a new job by the end of implementation. Therefore, the success of the EGF should be measured not only by the number of reintegrated workers but also by more long-lasting effects, such as new skills, qualifications, self-confidence, feelings of empowerment and social networks gained from participation in EGF measures. According to information received from Member States, reintegration rates tend to rise in the six months following the end of the implementation period and increase further in the medium term (18 months after the end of the implementation period). This trend shows that the long-lasting effects of EGF measures result in a more proactive approach to job seeking.

In addition, lessons learned from the design and implementation have been taken into account at national and regional level with a view to improving support to workers in the future.

Chart 9: Reintegration rate 15 for assisted beneficiaries per Member State

Number of EGF cases is in brackets

2.4.3. Qualitative assessment of the final reports submitted in 2019 and 2020

The Member States support packages for targeted beneficiaries include a wide range of personalised job search, outplacement and (re)qualification measures. The highest amounts were spent on three categories:

·Job-search assistance and case management: EUR 12.3 million (28% of the total personalised services)

This was one of the most commonly offered measures. It included general information services to workers/NEETs, career guidance, advisory services, mentoring, outplacement assistance, individual interviews with beneficiaries to establish their tailored reintegration path or to assess their skills, workshops for CV building and self-confidence, psychological counselling, peer groups, and support with the transition to a new job. This measure was offered to 15 022 beneficiaries in 18 of the 19 cases.

·Training and retraining: EUR 12.4 million (28% of the total personalised services)

As the above, this was an equally frequent measure, offered to 5 525 beneficiaries from all reported cases. This measure is tailored to the needs and wishes of EGF beneficiaries while taking into account the requirements of the local or regional labour markets and the sectors that are potentially job-creating. The training offer is often larger in scope than that usually provided at national level. It can range from vocational training to full university degrees, language courses, etc.

·Promotion of entrepreneurship: EUR 8.7 million (20% of the total personalised services)

This was the third most common measure, offered in 16 cases and supporting 1 020 beneficiaries. This support included creation of companies, tutoring meetings, mentoring activities, and financial incentives in the form of grants for business start-ups.

The significant variance across the cases in beneficiary reach rates (between 9% and 100%) is largely dependent on personal reasons (beneficiaries not wanting to participate) and contextual circumstances (labour market situation). However, the way in which the measures were designed and implemented may also have had an impact.

For example, in the Ericsson case in Sweden, the labour market was stronger than expected at the time of application, reducing the need for EGF support because many workers found a new job on their own. In Estonia (petroleum and chemicals case), the positive labour market situation, along with the fact that several measures offered were similar to those offered at national level, reduced the need for EGF support. In Spain, the main factor of lower participation related to national procedures that led to delays in implementation (Comunidad Valenciana automotive case) and to general lack of trust, demotivation and low self-esteem caused by the long period without support (Galicia wearing apparel case).

In terms of operational effectiveness, the EGF case in Finland (Microsoft 2) can be regarded as very successful and a best practice example. At the end of the implementation period, 92% of the workers had been reemployed. The absorption rate 16 was also high: 83% of EGF funds were used. Key elements that played an important role in obtaining such good results include:

1)a very quick reaction to the dismissals and early start of the measures with the national funding;

2)strong cooperation between the former employer, the regional and national authorities, the public employment services (PES) offices and service providers;

3)cumulated experience of previous EGF projects through existing project steering groups and networks of EGF-experts 17 ; and

4)individual customisation of training that matched the needs of each beneficiary.

The final reports show that EGF support:

1)increases the number and variety of services offered;

2)helps a larger number of workers;

3)allows experimentation with ‘innovative’ measures; and

4)strengthen partnerships between stakeholders (e.g. governmental bodies and worker’s organisations or training providers).

The EGF promotes lifelong learning opportunities for all through tailor-made trainings that aims at upgrading and updating skills. Long-term educational programmes are also eligible for EGF funding. For example, in Sweden and Finland, EGF beneficiaries had a wide portfolio of education to choose from, ranging from one-off training to full university degrees. EGF funding enabled provisions that would not have been procured via the public employment services.

In Germany (Goodyear case), additional and very personalised measures, including psychological support, stress management, consultation regarding personal problems like debts and addiction, language and adult literacy courses, etc. were offered to disadvantaged and vulnerable groups. They would not have received these without the EGF. For workers aged 60 and older, various peer group formats were offered to promote voluntary work and social exchange and these that were very well received.

The EGF measures take into account the socio-economic context, enabling beneficiaries to take part in these measures through mobility allowances or by supporting childcare. This was the case in Spain, where childcare costs were covered for workers taking part in training activities.

In Italy, the Almaviva case is a good example where the EGF allowed to experiment with innovative measures, such as a redeployment voucher that the jobseekers could spend, in both public and private employment agencies, to buy intensive job-search assistance services.

In Belgium, several innovations have been tested in EGF cases. The Caterpillar case was particularly rich in terms of the variety of solutions proposed for workers. The most innovative measure was to devote significant human and financial resources to stimulate entrepreneurship which resulted in the implementation of 117 projects. Moreover, a series of innovations was integrated into the 'standard' offer to redundant workers, in particular as regards the attention paid to psychological and emotional factors and the Coup de Boost project targeting NEETs.

2.5. Financial execution

2.5.1. EGF contributions

As laid down in Article 12 of the Council Regulation laying down the multiannual financial framework for the years 2014-2020 18 , the EGF must not exceed a maximum annual amount of EUR 150 million (2011 prices).

The EGF contribution is paid to the Member State in a single instalment, as a 100% pre-financing, within 15 days of the budgetary authority approving the EGF mobilising decision.

During the reporting period, the budgetary authority approved one EGF contribution totalling EUR 2 054 400 19 . The estimated costs of personalised services 20 included 8% of expenditure for preparatory workshops, 8% for occupational guidance, 52% for training, 12% for intensive job-search assisstance, 18% for allowances and incentives and 2% for tutoring after reintegration into work.

2.5.2. Technical assistance

Under Article 11(1) of Regulation (EU) No 1309/2013, and at the initiative of the Commission, up to 0.5% of the EGF financial resources available for the year can be used for technical assistance. This amount is to be used to finance activities necessary to implement the EGF Regulation, such as preparation, monitoring, data gathering, creation of a knowledge base, administrative and technical support, information and communication activities, as well as audit, control and evaluation.

For technical assistance, the budgetary authority made available EUR 610 000 for 2019 and EUR 345 000 for 2020.

Table 3.1: Technical assistance expenditure in 2019

Table 3.2: Technical assistance expenditure in 2020

2.5.3. Irregularities reported

No irregularities were reported to the Commission under Regulation (EU) No 1309/2013 in 2019 and 2020.

2.5.4. Winding-up of EGF financial contributions

The procedures for winding up EGF financial contributions are laid down in Article 18 of Regulation (EU) No 1309/2013. An EGF case is wound up when the final report with all required information has been sent to the Commission, all outstanding reimbursements have been paid and no further action needs to be taken by the Member State or the Commission. The obligation to keep available for the Commission and the Court of Auditors all supporting documents for three years (Article 21(5) of Regulation (EU) No 1309/2013) still remains.

In 2019 and 2020, 19 cases, implemented between March 2012 and September 2019, were wound up. The average absorption rate was 58%, with the lowest rate being 20% and the highest 85%. The total amount of unspent funds reimbursed to the Commission was EUR 26 512 409, accounting for 42% of the EGF contributions granted. Details of these cases are set out in Table 4 below.

The absorption rate of the EGF financial contribution varies significantly between Member States (see Chart 10), with the lowest observed average rates in Italy (24%), Greece (28%) and Spain (30%) and the highest in Finland (84%), France (74%) and Ireland (72%).

Chart 10: Average absorption rate per Member State (% of EGF contribution granted)

Number of EGF cases is in brackets

There are various reasons why Member States did not use the full amounts granted. While Member States are encouraged to make realistic budget estimates for the coordinating package of personalised services, accurate planning is not always possible at the application stage. They also tend to overestimate budgets and include a high safety margin in their initial calculations to reduce the risk of overspending or because there are many unknowns when applying e.g. the profiles and needs of potential beneficiaries.

The number of workers wishing to participate in the proposed measures tends to be overestimated in the planning phase. A lower level of participation than expected may result from unforeseen personal factors i.e. workers finding new jobs on their own, a lack of motivation or the choice of early retirement. Moreover, some workers may opt for cheaper measures rather than more expensive ones, or for short-term rather than long-term measures.

Other reasons for low spending have been delays in starting the measures, lack of sufficient staff for the implementation, insufficient use of the available flexibility to reallocate funds between budget items or more funding than initially expected being available at Member State level.

The Commission continues to offer guidance, already at the application stage, to Member States to encourage optimal fund management and improve the implementation rate. The budgeting of the measures and the forecasting of worker participation over the 24-month period are expected to improve with experience. The Commission is also seeing improvements in the capacities of the various coordination and implementation structures and the quality of communication between national and regional/local levels.

Table 4: Cases wound up in 2019 and 2020

2.6. Technical assistance activities undertaken by the Commission

2.6.1. Information and publicity: internet website

Article 12(2) of Regulation (EU) No 1309/2013 requires the Commission to set up, maintain and update an internet website, available in all EU languages.

In 2019 and 2020, the Commission regularly updated the EGF internet website 21 was with relevant information. It provides guidance on the submission of applications, information on accepted and rejected applications, and key facts and figures about previous EGF applications. Users can also find the details of EGF contact persons in Member States and links to publications, news and EGF-related events organised by the Commission and Member States.

2.6.2. Meetings with national authorities and EGF stakeholders

The 23rd and 24th meetings of the EGF Contact Persons 22 were held in March 2019 (in Athens) and in October 2019 (in Brussels). The meetings were devoted to ongoing cases and planned EGF applications, the System for Fund Management in the European Union (SFC2014), the EGF ex post evaluation 2014-2020, legal and auditing matters, data protection, simplified cost options and the Commission proposal for the post-2020 regulation, sharing best practices from EGF cases and other relevant issues.

Two EGF Networking Seminars were organised at the same time as the Contact Persons meetings and were dedicated to monitoring and evaluation for the post-2020 EGF, and green jobs and the EGF.

The seminar in Athens was complemented by project visits which gave the opportunity for exchange of experience between peers and meeting with beneficiaries. Both seminars were well attended by Member States representatives, stakeholders and EGF implementing bodies.

The EGF events planned in March and October 2020 were cancelled due to the COVID-19 pandemic. However, an online meeting dedicated to the ex post evaluation took place on 17 March 2020.

2.6.3. Electronic data exchange system (SFC2014)

In 2014, the Commission sought to simplify procedures further by including the EGF in the System for Fund Management in the European Union (SFC2014), which is the system for electronic data exchange with Member States,. Since April 2015, Member States submit EGF applications online through a guided application process and since August 2016 they also submit EGF Final Reports via SFC2014. Using SFC2014 for the EGF resulted in more correct and complete applications. It made the collection and processing of data easier and the reporting on EGF results faster. Applying for EGF support through SFC2014 has contributed to reducing the time between a Member State submitting and the European Parliament and the Council adopting the Commission proposal.

2.6.4. EGF ex post evaluation 2014 -2020

In accordance with Article 20 of Regulation (EU) No 1309/2013, the Commission is carrying out an ex post evaluation of the EGF. The aim of the evaluation is to assess the effectiveness, sustainability, efficiency, coherence, relevance and EU added value of the EGF. The evaluation covered all EGF cases for which applications were received between 2014 and 31 December 2019.

In 2019, the Commission selected an external service provider to conduct in 2020 a study supporting the evaluation and providing a report offering answers to the evaluation questions in the form of findings, conclusions and recommendations. The evidence consisted of desk-based research, targeted surveys and in-depth interviews with EU and national stakeholders and EGF beneficiaries, and an internet public consultation. Individual case studies were prepared for all the cases assessed 23 and sent together with the report. The contractor’s report was accepted by the Commission in December 2020. It will support the evaluation, which will be published as a Commission Staff Working Document (SWD) by the end of 2021.

The findings of the external study 24 show that (similarly to mid-term evaluation 2014-2020) overall, the EGF has been successful in providing support to, and showing solidarity with workers, self-employed people, and (in some cases) young people affected by major restructuring events.

Moreover, the EGF created true EU added value by increasing the number and variety of services offered to dismissed workers, and also their level of intensity. The assistance offered helped boost the self-esteem of beneficiaries, who then took a more proactive approach in job-seeking. In terms of assessing the effectiveness of the EGF, the study’s main finding was an increase in the average re-employment rate of dismissed workers into the job market. This rose from 49% (in 2007-2013) to around 60% (in 2014-2020), but ranging from a low of 18% to a high of 94% for various cases. Furthermore, the Fund remains relevant and useful, although there is room to reconsider its scope in terms of whom it targets and under what circumstances; to simplify or shorten administrative procedures; to improve the visibility of the outcomes; and better monitor the results of the EGF interventions.

3. EGF Regulation 2021-2027 25

On 28 April 2021 the European Parliament and the Council adopted the EGF Regulation for the 2021-2027 period which applies from 1 January 2021. The Fund becomes the European Globalisation Adjustment Fund for Displaced Workers. This emphasises the core objective of the EGF, which is to offer EU solidarity to workers who have lost their jobs by helping them to adapt to structural change.

Given that the purpose of the EGF is to provide financial support in situations of urgency and in specific unforeseen circumstances, the Fund remains as a special instrument outside the budgetary ceilings of the Multi-annual Financial Framework. Therefore, the EGF does not have an annual budget but a maximum annual ceiling that may be mobilised if needed. The maximum amount which could be used by the EGF for the 2021-2027 period is EUR 1.467 billion (in current prices) with an average of EUR 209.6 million (in current prices) per year.

To ensure that the EGF intervenes more effectively, and is more inclusive and flexible to respond to current and future economic challenges and changes in the labour market, the following improvements have been introduced to the 2021-2027 Regulation.

§Broader scope – displaced workers and self-employed people whose activity has ceased because of any major restructuring event, caused not only by globalisation-related challenges or financial or economic crises, but also by the transition to low-carbon economy, digitisation, automation, etc.

§Lower threshold – at least 200 26 displaced workers or self-employed people will trigger the Fund’s mobilisation, which better reflects the average size of today’s businesses, where in many Member States most workers are employed by small and medium-sized entreprises. The dismissal of 200 workers has a significant impact on the labour market in most regions.

§Alignment of the EGF co-financing rate with the highest ESF+ 27 co-financing rate, in the respective Member State – this will encourage countries to apply for funding in the most efficient manner.

§Faster application process and mobilisation procedure – simplified application will reduce the administrative burden for Member States.

The COVID-19 crisis has shown that unexpected events can cause substantial job losses, proving once more the importance of the EU’s ability to react fast and flexibly. The emergency nature of the EGF aims to provide a rapid EU support in the event of unexpected mass layoffs when national administrations would experience extreme difficulties in dealing with such situations.

In the 2021-2027 period, the new EGF rules will allow more workers and self-employed to benefit from the Fund and will cover the cost of support services at a higher rate. The EGF will continue providing European added value by improving the skills and employability of European workforce leading to better quality employment, and by enhancing social and economic cohesion among regions and Member States.

(1)

In 2019 one EGF application was submitted to the Commission (EGF/2019/001 BE/Carrefour) and it was rejected by the Council. In 2020, seven EGF applications were submitted (see Table 1 below), of which six at the very end of 2020. Out of the seven applications, only one was approved in 2020, five out of the six applications submitted at the end of 2020 were approved by the European Parliament and the Council in 2021 and one was withdrawn by Spain (EGF/2020/006 ES/Cataluña automotive) in 2021.

(2)

https://eur-lex.europa.eu/eli/reg/2021/691

(3)

Set up by Regulation (EC) No 1927/2006 of the European Parliament and of the Council of 20 December 2006 on establishing the European Globalisation Adjustment Fund, amended by Regulation (EC) No 546/2009 of the European Parliament and of the Council of 18 June 2006 and subject 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

(4)

OJ L 347, 20.12.2013, p. 855–864

(5)

The six Member States are mentioned according to the time of submission of the applications

(6)

The four Member States are ordered according to the time of submission of the applications

(7)

Article 4(1)(b) of the EGF Regulation requires that at least 500 workers are 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. In line with Article 4 (2) of the EGF Regulation, an application can be derogated from this criteria because of exceptional circumstances or because the case happened in a small labour market.

(8)

See previous footnote

(9)

NACE Rev. 2 - Statistical classification of economic activities in the European Community: https://ec.europa.eu/eurostat/web/products-manuals-and-guidelines/-/KS-RA-07-015

(10)

NACE Rev. 2 sector 77 is rental and leasing activities

(11)

See: https://data.consilium.europa.eu/doc/document/ST-13418-2019-INIT/en/pdf

(12)

https://ec.europa.eu/social/main.jsp?catId=738&langId=en&pubId=8371&furtherPubs=yes

(13)

During 2009-2011 the implementation period was 12 months, while for 2012-2023, it was 24 months.

(14)

SWD(2018) 192 available at : https://eur-lex.europa.eu/legal-content/EN/TXT/?qid=1562591970533&uri=CELEX:52018SC0192

(15)

The reintegration rate shows the employment status six months after the end of the implementation period.

(16)

Absorption rate is the percentage of the EGF financial contribution that was spent by the Member State within the implementation period specified in the application.

(17)

Many of them are former EGF beneficiaries working now in PES offices and in private services providers.

(18)

Council Regulation (EU, Euratom) No 1311/2013 of 2 December 2013, OJ L 347, 20.12.2013, p. 884.

(19)

This amount does not include the technical assistance decisions at the initiative of the European Commission.

(20)

Actions under Article 7(1)(a), 7(1)b and 7(1)c of the EGF Regulation

(21)

https://ec.europa.eu/social/main.jsp?catId=326&langId=en

(22)

Contact Persons are nominated by the authorities of the Member States responsible for the European Globalisation Adjustment Fund. It is the authority of each Member State which decides who will represent it.

(23)

The individual case study reports were not and will not be published.

(24)

https://ec.europa.eu/social/main.jsp?catId=738&langId=en&pubId=8371&furtherPubs=yes

(25)

Regulation (EU) 2021/691 of the European Parliament and of the Council of 28 April 2021 on the European Globalisation Adjustment Fund for Displaced Workers (EGF) and repealing Regulation (EU) No 1309/2013

(26)

A derogation from this provision is possible in small labour markets and in exceptional circumstances.

(27)

European Social Fund Plus