This document is an excerpt from the EUR-Lex website
Document 52011SC1134
COMMISSION STAFF WORKING PAPER Ex-ante Evaluation
COMMISSION STAFF WORKING PAPER Ex-ante Evaluation
COMMISSION STAFF WORKING PAPER Ex-ante Evaluation
/* SEC/2011/1134 final */
COMMISSION STAFF WORKING PAPER Ex-ante Evaluation /* SEC/2011/1134 final */
Table of content 1........... Introduction. 3 2........... Problem analysis and needs assessment 4 2.1........ Global
policy challenges. 4 2.2........ Specific
problems – rationale for EU intervention. 5 2.2.1..... The
Progress programme. 5 2.2.2..... EURES. 10 2.2.3..... Microfinance
and Social Entrepreneurship. 11 2.3........ Who
are the target groups and what are their needs?. 15 3........... Lessons from the past 18 3.1........ The
current system of funding. 18 3.2........ Achievements
of the current instruments and delivery issues. 19 3.2.1..... The
Progress programme. 19 3.2.2..... EURES. 22 3.2.3..... The
European Progress Microfinance Facility. 23 4........... Stakeholder consultations. 26 4.1........ The
Progress programme. 26 4.2........ EURES. 28 4.3........ The
European Progress Microfinance Facility and support to social enterprises. 28 5........... Baseline scenario. 30 6........... Objectives, expected results and indicators for the
programme. 32 6.1........ The
objectives of the programme. 32 6.2........ Definition
of indicators. 33 6.2.1..... Indicators
for general objectives. 34 6.2.2..... Indicators
for specific objectives. 37 7........... Alternative approaches. 44 7.1........ Alternative
delivery options. 44 7.1.1..... The
Progress programme. 44 7.1.2..... EURES. 44 7.1.3..... Microfinance
and Social Entrepreneurship. 45 7.2........ Detailed
assessment of options. 46 7.2.1..... PROGRESS. 46 7.2.2..... EURES. 48 7.2.3..... Microfinance
and Social Entrepreneurship. 49 7.3........ Consideration
of "no action" 52 7.4........ The
favoured delivery option. 53 7.5........ Risk
assessment of the favoured delivery option. 54 8........... EU added value of the intervention. 56 9........... Cost-effectiveness of the proposed option. 58 10......... Monitoring and evaluation. 62
1.
Introduction
The
Directorate General for Employment, Social Affairs and Inclusion is designing
the proposal of the Commission for a new European Union Programme for Social
Change and Innovation for the period 2014-2020. The new programme provides for
the continuation and development of activities currently carried out under the
PROGRESS programme (2007-2013), EURES network and the European Microfinance
Facility (established in 2010). The
proposal for the new programme has budgetary and resource implications,
therefore an ex- ante evaluation is required in accordance with Article 22 of
the Financial Regulation. The overall aim of the new programme will be to contribute
to the implementation of the Europe 2020 Strategy, its mutually reinforcing
headline targets and Integrated Guidelines by providing financial support for
the European Union’s objectives in terms of promoting a high level of
employment, guaranteeing adequate social protection, fighting against social
exclusion and poverty and improving working conditions. With a proposed budget of € 958.19 million, the programme
will seek to achieve the following objectives: (a)
Strengthen
ownership of the Union objectives in the employment, social and working
conditions fields among key Union and national policy-makers, as well as other
interested parties in order to bring about concrete and coordinated actions at
both Union and Member State level; (b)
Support the development of adequate, accessible
and efficient social protection systems and labour markets and facilitate
policy reform, by promoting good governance, mutual learning and social innovation; (c)
Modernise Union law in line with the Smart
Regulation principles and ensure that Union law on matters relating to working
conditions is effectively applied; (d)
Promote workers’ geographical mobility and boost
employment opportunities by developing Union labour markets that are open and
accessible to all; (e)
Promote employment and social inclusion by
increasing the availability and accessibility of microfinance for vulnerable
groups and micro-enterprises, and by increasing access to finance for social
enterprises.
2.
Problem analysis and needs assessment
This section demonstrates the need for a public
programme, and forms the basis for the programme design and delivery.
2.1.
Global policy challenges
In the area of social and employment policy, the EU
continues to face complex socio-economic problems, such as ·
high unemployment rates, especially among the low-skilled, older
workers, migrants and people with disabilities; ·
an increasingly fragmented labour market, featuring the emergence
of more flexible work patterns and other challenges that have an impact on job
security and working conditions, including gender pay gap and other
inequalities in employment; ·
a shrinking workforce and increasing pressure on social protection
systems as a result of demographic change (ageing population); ·
an unacceptable high number of people living below the poverty
line and in social exclusion. These
challenges have been compounded by the recent economic and financial crisis,
which has hit all Member States and regions in the EU, leading to record
unemployment levels in some Member States, especially among low skilled and
young people. The crisis also highlighted close links and spill-over
between EU-27 economies, especially in the euro area, which means reforms or
the lack of them, in one country, affect the performance of the others. Common
action taken by the EU as a response to the crisis, particularly through the
adoption of the European Economic Recovery Plan and common action to stabilise
the banking system, proved to be effective, which means that coordinated
actions at the EU level are more effective in addressing these challenges than
individual actions of single Member States. To be cost-effective, reforms also need to be as far as
possible based on evidence. By involving policy-makers and other stakeholders
in a collective learning process and by participating in developing and testing
new approaches greater acceptance, ownership of, and commitment to, the Europe
2020 agenda can be achieved. In this context, social innovation and social experimentation
can be powerful tools to guide the reforms and policy adaptations needed to
implement Europe 2020. However, the development and
dissemination of a social innovation approach on a larger scale in the European
Union is hampered by: -
insufficient knowledge of
the needs and capabilities of civil society organisations, social enterprises
and social entrepreneurs and public sector organisations; -
fragmentation of efforts and
resources, lack of transparency and visibility, limited financial support and
insufficient technical skills that can support organisations to develop and
deliver social innovations; -
low levels of involvements
of citizens and business[1]; -
poor diffusion, and little
scale-up of good practices; -
poor methods of impact
evaluation of actions and policies[2]. While actions to tackle socio-economic problem
areas are primarily the responsibility of the Member States and regions and
have to be taken closest to the citizen at national and sub-national levels,
the EU has a role to play in putting the need for specific reforms on the
agenda, informing about barriers to change and opportunities’ how to overcome
these, ensuring that existing European level rules are complied with,
stimulating sharing of good practice and mutual learning, and supporting social
innovation and Europe-wide approaches, where there is clear value added for
European solutions.
2.2.
Specific problems –
rationale for EU intervention
2.2.1.
The Progress programme
The key issue for the EU social and employment policy, within the
EU's limits of competence, is that of ensuring collective action and effective
policy co-ordination among the EU Member States. The fundamental framework for
addressing this issue is provided within the Treaty (TEU) itself, which clearly
sets out two principal types of action by the Union, namely: a) co-ordination
(adoption of measures designed to encourage co-operation between Member
States); and b) legislation (adoption, by means of directives, minimum
requirements for gradual implementation). The determination to ensure greater policy co-ordination across
the EU was recently re-affirmed at the most strategic level by the Europe 2020
Strategy. Previous experience in fostering the co-operation of the Member
States in the employment and social affairs area points to a number of factors
that influence the success of co-ordinated policy response to common
socio-economic challenges. These include -
consistent and sufficient
conceptualisation of key factors and their interdependencies behind the
socio-economic problems (e.g., how to explain in-work poverty); -
consistent terminology and
measurements to allow for monitoring and benchmarking (e.g., how to define and
measure poverty); as -
comparable data to evaluate
the relative importance of variables identified as influential on outcomes of
interest (e.g., systematic
monitoring of the situation of young people not in employment education or
training, NEETs); -
convergence or synergies
between goals, values and interests of a variety of stakeholders[3]. A lack of adequate evidence complicates
policy co-ordination despite the presence and acknowledgement of common goals. Importantly, ensuring adequacy requires not only
the generation of new information (such as comparable statistics, sufficient
analytical knowledge), but also effective sharing of existing sources (such as
available good practices) through mutual learning processes such as
periodic monitoring, evaluation and peer review. Also, an evidence base always comprises stakeholder opinion on an issue or
set of issues. Therefore, elaboration
of consensual policy solutions requires active involvement of all
stakeholders throughout the policy process. Some examples to illustrate the importance and
the effectiveness of co-ordinated policy responses in the area of PROGRESS: In response to the socio-economic challenges, in 2007 the
European Commission together with the Member States and the social partners
elaborated a set of common principles known under the heading of flexicurity,
which address policies and measures as well as the involvement of stakeholders.
At the same time it was noted that to reach a consensus on
joint principles of flexicurity one needs both the information (such as a
reference definition of the concept of flexicurity, as well as meaningful,
high-quality and up-to-date information on the current situation in each of the
27 Member States with regard to both external and internal forms of flexibility
and security for all forms of standard and non-standard forms of employment),
and a continuous process of social dialogue at the European level, as well as
the involvement of all stakeholders (including civil society) in search of
negotiated solutions[4].
The way in which work is organised, alongside health and
safety in the workplace, can play a major role in helping to achieve higher
employment rates by ensuring wellbeing at work, maximising the ability of
individuals to work and preventing early withdrawal from the labour market[5]. A large body of EU
law in the field of health and safety at work has been developed with the aim
of improving working conditions in the EU and reducing the incidence of
work-related accidents and illnesses; however, the degree to which the EU
legislation has actually been implemented differs considerably from one Member
State to another[6].
At the same time, the global economic downturn may have led
organisations to concentrate on short-term economic survival strategies,
overlooking the long-term importance of workplace safety and health[7]. Therefore, in
order to ensure equal protection of European citizens in the workplace,
particularly in sectors considered to be at risk and for categories of workers
who are most vulnerable (young people, workers on fixed-term contracts,
low-skilled workers, migrants, etc.), the implementation of EU legislation has
to be strengthened. The Commission, as the guardian of the Treaties, has to
ensure that the EU directives are transposed and implemented correctly, and
assist Member States in doing this. A package of instruments guarantees a high level of
compliance with the legislation, and this should include dissemination of good
practice at the local level, distribution of information and guidelines,
involvement of labour inspectors as intermediaries to promote better compliance
with the legislation in SMEs, etc[8]. The current EU strategy aims to achieve a 25% reduction in
accidents at work by 2012. This requires ensuring gender and age equality at
the workplace as well as tackling other new and emerging risks in
occupational safety and health, including chemical risks in SMEs, exposure to
noise and hearing impairment, ultraviolet radiation, occupational diseases and
various other hazards[9].
The acceleration of innovation, the emergence of new risk factors and the
transformation of work patterns are changing the nature of occupational hazards.
Certain types of occupational illnesses are becoming more common
(musculoskeletal disorders, infections and illnesses associated with psychological
stress). These changes mean that a better understanding of the problems must be
acquired by conducting specialised research in order to identify effective
prevention measures, and therefore possible legislative responses. This better law-making, and the previously mentioned need
to ensure implementation and enforcement, are closely linked: a good law is an
enforceable and enforced law. Only a limited number of Member States experience
delays in the timely transposition of directives in the area of working
conditions, while application problems for the Member States are more common
and arise primarily as a result of political will of national administrations
to invest themselves in the EU’s decisions. This implies changes in specific
approaches, such as guaranteeing administrative capacity, screening domestic
rules and procedures, a systematic discussion between relevant authorities
across the EU, ex-post evaluations and accountability of national
administrations towards their counterpart authorities in other Member States,
involvement of sub-national authorities with autonomous legislative powers,
supporting networks of public authorities, systematic assessment of their
performance and the identification and spread of best practices, as well as extension
of training programmes for judges and public administrations. To address these
challenges, a cultural change is required, which includes a shift from
increasing new EU law to an emphasis on effective application[10]. The combination of rising longevity and lower fertility
leads to a steep aggravation of the old age dependency ratio and far-reaching
consequences for economic, budgetary and social developments. Faced by these
challenges, most Member States are reforming their pension systems to
retain sustainability as well as adequacy and to ensure fairness between and
within generations and between men and women. Still, the sustainability and
adequacy concerns for all types of pension schemes have been aggravated by the
crisis, while lower economic growth will make it harder and more urgent for
policy-makers to find a good balance between sustainability and adequacy of
national pension systems, especially when the transition costs, pension
adequacy, and distributional impacts of the reformed pension systems are
considered[11].
Therefore, it is vital to strengthen the awareness of
available routes to adequate income in retirement, share information and ensure
better coordination at the EU level on measurements and data[12], but the lack of
consistent data complicates quantitative analysis of pensions needs in EU
Member States[13].
A number of countries rely on poor quality data with no obvious common
characteristics. Barriers with regard to the availability of statistical data
were found to be closely connected to the absence of efficient and
comprehensive statistical infrastructures. The same demographic developments also lead to a number of
challenges facing health and long-term care systems across the
EU. Total spending on health absorbs a significant and growing share of
resources (EU average of 9.6% of GDP in 2008, up from 8.5% of GDP in 1998),
while public spending on health constitutes a significant share of total
government expenditure (14.7% in 2008, up from 12% in 1998) and GDP (EU average
of 7.4% of GDP in 2008, up from 6.6% of GDP in 1998)[14]. All EU Member
States face strong and growing pressures on their health systems, while rising
demand and constrained resources exacerbated by the recent economic crisis make
cost-effectiveness one of the most important goals in this area. Ensuring equal access to healthcare according to
socioeconomic status, place of residence, ethnic group and gender will
therefore be one of the key challenges facing health systems across the EU in
the future[15].
Each Member State needs to assess the way its health system functions and find
areas for improvement, possibly using peer reviews and other mutual learning to
find solutions that can be adapted to each national context. For this, it is
crucial to have comparable and accessible evidence in order to understand the
incentives associated with different payment mechanisms and ensure they are
used to achieve policy objectives. However, data is still not always routinely
available and comparable within and across countries[16]. Reinforcing an
integrated approach on reduction of health inequalities therefore requires not
only improving common knowledge and data collection (including definition of a
restricted number of relevant EU indicators), but also greater visibility on
this subject as well as building commitment across society. This necessitates
more active stakeholder involvement and could benefit from peer reviews and
exchange of best practices in cooperation with the Committee of Regions and Member States based on the experience of the most advanced countries, while considering
actual transferability of practices with care[17].
More generally for the area of social protection and
social inclusion, the SPC report on the mutual interaction between the
common social objectives and the strategies for growth and jobs[18] made reference to
the importance of mutual learning and the peer review process in particular, as
did the SPC report on a voluntary European quality framework for social
services[19]
and the Eurostat report on the social situation in the European Union (2009)[20]. The analysis performed as a part of the on-going evaluation
of the peer review process in this policy area[21]
signals the importance of the mechanism. It reveals that in 2004-2010, there
were around 10-20 cases every year when Member States rather clearly expressed
their intention to use/ transfer the ideas discussed, and 15-25 cases when Member
States indicated that they find the ideas interesting. Very frequently the Member
States also mentioned important constraints that make transferability difficult
(especially differences in terms of division of responsibility between national
and regional/ local institutions, budgetary constraints, strength of the NGO
sector, etc.). Indeed in many cases the peer review participants both expressed
their interest in the practices presented and also discussed the potential
difficulties of transferring the ideas to other societal and policy contexts. There is a broader agreement among academic commentators,
NGOs, and the SPC itself that despite the Social OMC’s undeniable contributions
to promoting mutual learning among EU Member States, its full potential in this
area has not yet been fully exploited[22]. Some population groups are especially underrepresented in
employment and fare much worse in various areas of life, such as women with
disabilities[23]
and people with mental disabilities[24].
There is a very significant absence of disability mainstreaming in the
presentation of labour market statistics and indicators. Statistical data on
the situation of persons with disabilities on the labour market is not fully
comparable across countries due to the fact that definitions of disability vary
largely across and even within countries depending on the legislative context[25]. Similar
legislative issues apply to the transposition of EU rules on Gender Equality
into national law: EU-wide analysis shows that the Member States still do not
unanimously transpose EU law and definitions with regard to direct and indirect
discrimination, positive actions, harassment, access to work and working
conditions, pregnancy and maternity, parental leave and other issues[26]. Mainstreaming of non-discrimination is not limited to
legislative action. For example, Roma are disadvantaged in several
respects and are particularly vulnerable to social exclusion, poverty and
discrimination. Access to fundamental rights and level of social inclusion are
deeply influenced by a number of factors including racism and discrimination
against Roma, civil status and access to personal documents, the general
economic and political climate, political participation and representation. Widespread negative attitudes towards Roma and
stigmatisation are important barriers to successful implementation of measures
to improve Roma inclusion[27].
While several important legislative developments at the EU level during the
last 10 years have established a framework for greater protection against
racism and racial discrimination for EU citizens, including Roma, successful
policy conditions for further Roma inclusion still require multi-sector
approaches to social inclusion, effective coordination of policy
implementation, sustainable social inclusion policies, targeting and
mainstreaming, positive action, Roma participation and adequate data
collection. A strengthened policy framework under Europe 2020 implies an
even stronger need for evidence for decision making than it was before. With
regard to the successor programme, this means that it will have to strengthen
its assistance to the Commission in
implementing its tasks: a)
Fact finding and evidence gathering about relevant developments in
the EU Member States, candidate countries, EEA and EFTA states and in the
international context; b)
Regular supervision and reporting on the progress of the Member
States’ towards common priorities and objectives laid down at the EU level; c)
Monitoring and strengthening gender mainstreaming; d)
Safeguarding the Treaties (ensuring and, if necessary, reinforcing
the effectiveness and uniform application of EU law); e)
Reporting regularly on the transposition of provisions of
individual Directives into national law; f)
Modernising EU legislation in line with the Smart Regulation
principles. Next
to assisting the Commission in accomplishing its tasks, the successor to
PROGRESS should also feature a process of discussion and search for consensus
between the various actors, including - next to the public authorities on the
different levels - also social partners and civil society.
2.2.2.
EURES
The free movement of workers is one of the four
freedoms in the TFEU. One of the ideas behind Articles 45 and 46 is to enable
workers from Member States with high level of unemployment to move to other
states where there is a demand for jobs. Economic development and European
social cohesion can be improved if workers can move freely between EU member
states from regions with low career prospects to those where they have better
perspectives. The June 2010 Special Eurobarometer on "Geographical and
labour market mobility" showed that 34% of Europeans think that their
chances of finding a job abroad are better than in their own countries; However,
only 2.3% of the working age population lives and works in a Member State
different from the one of their nationality. Geographic mobility in Europe is limited due to
a number of obstacles. Aside from an uncertainty over the advantages of being
mobile, individuals face a number of hurdles to free movement. These can range
from legal and administrative obstacles, housing costs and availability,
employment of spouses and partners, portability of pensions to linguistic
barriers and issues on transparency of job vacancies and missing support for
matching CVs with job offers. EURES addresses transparency issues by making
available job vacancies from Member States on the EURES Job Mobility Portal and
provides support for activities in the areas of recruitment and related
information, advice and guidance services at national and cross-border level. Increasing intra-EU-mobility by giving access to
more employment opportunities may contribute to economic growth. Evidence from
Commission research suggests that countries not applying transitional rules on
free movement and therefore allowing incoming mobility have benefited from a
higher GDP growth. "Positive externalities
from mobility clearly outweigh the negative externalities. Geographic mobility
may indeed be a win-win situation in economic terms for both the sending and
the receiving country. Positive externalities mainly stem from positive growth
effects associated with free movement of human capital reducing labour market
imbalances, improved skill matches in an integrated market, higher investment
into education, and a higher level of innovation and entrepreneurship. Negative
externalities are primarily pecuniary or fiscal, and these negative effects in
the destination country are at least partially offset by corresponding positive
effects in the sending region. The efficiency gains, however, are unambiguously
beneficial for Europe."[28] Further down in the policy implementation cycle, the European
Public Employment Services (PES) play a vital role in better matching demand
and supply on national and EU labour markets; and preventing the risks of
structural and long-term unemployment. With the recent recession and the
starting war for talents the expectations towards PES have become even
stronger. The role of PES has changed; more and more they act as transitions
agencies and therefore need to by strengthen their service delivery. While
their main role currently is to address the needs of the unemployed, employment
services can play a more comprehensive role as lifelong service providers,
delivering services in skills assessment, profiling, training delivery,
individual career guidance and client counselling (workers and employers),
matching people to job profiles, and offering services to employers, as well as
catering for the challenges of those furthest away from the labour market.
Employment services should also promote partnerships between and among services
(public, private and third sector employment services), education and training
providers, NGOs and welfare institutions. Following the Court judgement[29], the current
limitation to Public Employment Services of EURES is no longer possible, and
new methods of cooperation with the private sector are being explored (see
Section 5).
2.2.3.
Microfinance and Social
Entrepreneurship
Entrepreneurship refers to the process of creating or
expanding economic activity, primarily by establishing new businesses or new
ways of doing business: entrepreneurs that take the risk of doing things
differently. Becoming self-employed is one avenue for unemployed people
to get into a job and make a living, and an important pathway out of social
exclusion. Entrepreneurship is also easing transition from the informal to the
formal sector. Job creation through the establishment and consolidation of
new businesses therefore plays a significant role in achieving the employment
and inclusion targets of the Europe 2020 Strategy: a significant share of new
jobs in the EU is created by newly established firms and almost 85% of these
jobs are created by micro-firms. In the EU, these firms generate on average
nearly 2 jobs, in some Member States up to 3. However, Europe is far from exploiting its full potential
in this respect: the rate of business creation[30]
on average is estimated at around 4.5 % in the EU, compared to 8% in the USA[31]. According to a
2009 survey, on average 45% of Europeans wish to become self-employed against
60% in the USA. As a result of the crisis, even fewer think it is feasible to
become self-employed[32]. Microfinance One of the major obstacles to business creation is lack of
access to finance, especially micro-credit (i.e. loans of less than EUR 25 000)[33]. In 2007, i.e. before the economic crisis, the Commission
estimated the demand for microcredit at around 700 000 loans worth EUR 6.2
billion in the short term[34].
Taking into account research done at national level, this seems to be a careful
assessment: for instance a 2009 French study estimated the unsatisfied demand
for microloans only for France in 2008 at 187 000 microloans[35] (of which 113 000
in the bankable segment, 74 000 on the non-bankable segment)[36]. The crisis seems to have exacerbated the problem: a 2010
study commissioned by the European Parliament shows that 55% of the responding
microcredit providers expected a "strong growth" of demand over the
coming three years. According to a sample of microcredit providers in ten EU
Member States[37],
the potential demand could reach as much as 2 935 000 microloans (in these ten
countries). Most demand was expected from people made unemployed/hit by the
crisis and wishing to start a business (20% of responses). This group is
followed by people who are long-term unemployed or living on social benefits
(12% of responses), or who are excluded both from welfare and the market (4%)
or who are part of typically fragile groups such as single parents, the young,
migrants (4%). The study interprets these findings as that the crisis has
doubled the demand potential for microfinance in Europe[38]. The mismatch between the low level of microcredit supply
and the high demand can be explained by several factors: One is the difficulty
for microcredit providers to assess the risk of providing a microloan to a new
business: young companies or start-ups have by definition no track record and
mostly only limited collateral to mitigate the risk. But even well established
micro-enterprises are often unable to provide the necessary information and
collateral for obtaining a bank loan[39].
With the financial and economic crisis[40]
banks tend to be even more risk averse and hence demand more collateral and
security[41].
Because of these (perceived) higher risks of young companies or start-ups,
financial institutions, in particular banks, do not see micro-finance as a
profitable product. In addition, small loans entail comparatively high
administration expenditure and transaction costs per loan[42], which further
reduces profitability if these costs cannot be fully charged to the client. Cost for micro-lending is even higher for loans to people
from disadvantaged groups such as unemployed, young or older people or
migrants, as this type of clients represents a higher risk of default and would
often need costly personalised business support services. By and large,
micro-loans for these target groups cannot be provided on a commercial basis. Hence, by far the majority of micro-credit to disadvantaged
persons in the EU is provided by non-commercial micro-finance institutions
(NGOs, foundations, government bodies, Member States' promotional banks,
non-bank financial institutions). The European micro-finance sector has clearly
not reached maturity yet: in 2009, 57% of the European microfinance
institutions disbursed less than 50 loans while only 13% of the organisations
disbursed more than 400 loans[43]. In order to grow, European micro-finance institutions would
need to build and maintain adequate funding models. This is a weak point,
especially of non-bank microfinance institutions, as a market study for the EIF
revealed. The latter identified a clear need for institutional
capacity-building through sustained funding to cover start-up and operative
costs and funding for on-lending to high risk target groups. Other difficulties
found were underdeveloped systems for performance measurement and analysis,
only average capacity levels regarding human resource management and a lack of
capacity by non-bank microcredit providers for networking and co-operation[44]. In a 2010 survey
carried out by EMN, European microfinance institutions counted the lack of
institutional capacity and lack of access to funding to cover operational costs
or for lending among the most significant obstacles to growth[45]. EMN considers the
lack of access to long-term funding as the most important problem driver as it
restricts microcredit providers' ability to grow, to broaden and deepen
outreach across the sector, their ability to build institutional capacity and
their ability to reach sustainability, especially during the financial and
economic crisis. A study commissioned by the European Parliament[46] seems to confirm
this analysis: asked about the form of support which would have the greatest
impact on the development of their microfinance activity, the respondents of a
survey[47]
identified grants for institution building, capital and grants for client
support as the three highest priorities[48]. Social entrepreneurship Social enterprises show a great variety in terms of legal
status, products and services produced or distributed, markets served, and
growth potential[49].
They also differ largely in terms of composition of revenue (sales, service
contracts with public bodies, donations, voluntary work etc), which in addition
tends to change during the development of a social enterprise towards financial
self-sufficiency. The common pattern in their financial needs is that the more
revenue is generated through trading on the market, the more they depend
external financing for consolidation and growth. Their specific financing
requirements (long-term; mix of grants, equity and loans for new services or
new markets) makes it difficult for traditional financial institutions to serve
their financing needs. This has led to the emergence of (infant) social investment
markets in some countries (in particular UK and France), whereas these are less
advanced in most other Member States, definitely in the new Member States. The
main actors[50]
offering social investments are: - Value banks; - Venture philanthropy funds; - Social investment funds; - Funding consultancies, and; - Social stock exchanges. Each of those serving a specific market segment, offering
(a range of) financial instruments (grants, debt, equity, mezzanine capital,
and a combination of these: “hybrid capital”. The main imperfections of, and barriers to social
investment markets on the supply side are[51]
EU and national financial market regulation: - Lack of understanding the specificities of
social enterprises by traditional financial sector; - Uncertainty that market or close to market
returns can be achieved, and insufficient protection of downside risks; - Insufficient liquidity to reduce perceived risk; - Missing or weak measurement of the social
returns generated by the investment; - Few products and managers with a track record in
social impact investment; - Weak investment propositions, notably few large
scale investment opportunities; - Insufficient numbers of social business angels. In addition, there are also demand side barriers to social
investment, in particular: - Insufficient orientation on capital markets, but
on the grant economy; - Legal structure prevents taking (quasi-)equity; - Market for social impact investment not
transparent; - Insufficient experience in making proposals for
external financing, and for combining different sources and types of finance (
e.g. grants/loans); - Insufficient infrastructures /business
development services/ incubators etc. Furthermore,
there are market structure barriers
to social investment resulting from lack of qualified intermediaries and market
places. The concept of social entrepreneurship (which draws on the
well-established European tradition of the social enterprises such as social
co-operatives) reflects the need to restructure business towards inclusive,
socially fairer, and environmentally sustainable growth, to generate jobs by
meeting the needs of a diversity of work, lifestyles and social values, and to
link entrepreneurial activity with social innovation. This business model seems
to meet growing acceptance and application by young people and women, whose
business creation rates are higher for social enterprises than for traditional
businesses.
2.3.
Who are the target groups
and what are their needs?
The
main players affected by the Progress programme are public authorities,
social partners and civil society organisations at EU and national level as
well as the European Commission itself. A needs analysis[52] looked into the
situation, motivations and interests of EU-level, national and regional
stakeholders in relation to the broad thematic areas addressed by the programme
and identified a number of implications for the successor instrument. National
authorities emphasised a need for simple, but effective implementation
mechanisms, reduction of red tape and administrative burden in access to EU
programmes. They also underscore that the EU needs to respect the unique
situation of each country and not try to find a “one size fits all” approach,
but rather facilitate exchange of information about solutions which proved to
be effective. EU-wide definitions and indicators, comparable data and monitoring
are seen as useful tools for informed policymaking. Pooling, comparing and
disseminating the Member States’ initiatives would also help facilitating
policy implementation. Most
social and economic partners focused on such interests as recognition of their
contribution to public policies, networking, exchange of information and good
practices, and balanced policy dialogue. The study found that the merely formal
nature of stakeholder involvement and fragmentation of policies (separation of
employment and social policies) impede more effective participation of social
and economic partners. The
key interests of NGOs and networks appeared to be rather similar, yet often in
tension with interests of other stakeholders. Inclusive policy dialogue with
extensive mainstreaming of the needs of various target groups and sub-groups,
consultation and partnership at multiple levels and stable public funding were
often mentioned among the interests of this group. While
national authorities emphasised subsidiarity, NGOs and networks encouraged the
EU to be more proactive. Such potential tensions should be solved on a
case-to-case basis, and the successor instrument can be used to identify such
tensions and engage various actors to solve them. The
needs analysis has also revealed a strong emphasis on visibility and
dissemination. Therefore focusing on visibility, dissemination and
exploitation, as well as exchange of good practices within the framework of the
successor instrument would create a win-win situation for all. As emphasised in
the recent guidelines for EU’s policies for social innovation[53], there will be an
increasing need to scale up innovative approaches and support transfer of
evidence-based social experimentation. The analysis of stakeholder needs
supports this approach: most stakeholders are in favour of EU support for
social experimentation and dissemination of good practices and innovative
approaches. The
main target group of EURES are employers, jobseekers and job changers.
Among jobseekers and job changers younger cohorts and graduates can be
identified as main target group as they are strongly affected by the current
economic crisis and at risk of long-term unemployment. Moreover, young people are
typically more mobile than middle-aged or older people. According to an external evaluation of the
functioning of the EURES network in 2006-2008[54],
the majority of people who use EURES as a job search tool are men (64.1%). Men
and women searching for job are typically aged 26-35 (43.8%) or 36-50 (34.5%).
The majority are educated at Bachelors (31.1%) or at Masters (27.9%) levels.
The analysis of the database for requests to EURES advisers revealed that the
majority of contacts took place with jobseekers and job changers rather than
with employers. Since the second quarter of 2007, 86.0% of all contacts have
taken place with jobseekers or job changers. Job search has constantly been the
most common topic discussed through the adviser contacts: on average 41.2% of
the contacts focussed on this issue between 2006 and 2008. The second most
common topic was general information on EURES discussed in some 17.3% of the
contacts during the same time period. Other main topics were social security
and taxation, education and training, living and working conditions and other
general information and advice The final
target group of EU-level microfinance support is people who want to
become self-employed or set up or develop their own business and face
difficulties in securing a traditional bank loan, i.e. unemployed people, people
at a risk of losing their jobs and people from disadvantaged groups, for
instance young or older people or migrants. These people need better access to
microcredit, i.e. loans of less than EUR 25 000. In order to reach out to this target group, EU support is
provided directly through microcredit providers,, i.e. public and private
bodies at national, regional and local levels which provide microloans to
persons and micro-enterprises in the EU Member States and in the EEA and
candidate countries. If they are to reach out to the final beneficiaries
mentioned, they need instruments to mitigate the risks they incur and funding
to refinance their loan capital. In order for the microfinance market to grow
and increase its absorption capacity, long-term financial support for
institutional capacity building is also needed. The final beneficiaries of EU level social entrepreneurship
support are social enterprises[55] which can be
characterised as follows: - Their mission is to generate a societal value in
the general interest, notably by contributing to smart, sustainable and
inclusive development (thus their purpose and impact are social). This often
translates in a high degree of social innovation. - They establish business governance and ownership
structures that reflect the mission of their social enterprise, promoting
empowerment and involvement in decision-making and increasing participation in
social and working life, of employees, partners and clients (thus their process
of working is social). - They mainly use the surplus generated from their
economic activity to realise their societal objective, by reinvesting and
furthering their societal purpose (thus using the economic benefits for a
social purpose). These enterprises can achieve their social impact either through
the goods and services they produce (e.g. services to disadvantaged groups like
access to housing, health care etc.) or through the way the produce them
(integration of disadvantaged groups into the labour market). Social enterprises have difficulties in access to funding for
development, consolidation and scaling of operations[56]. To channel
funding to social enterprises, EU-level social entrepreneurship support targets
social investment funds. Typically these funds have a size ranging between
EUR 10 million and EUR 50 million. According to the EIF,
investments by an EU level financial instrument in such funds should range
between EUR 5 million and EUR 15 million, depending on the fund size.
3.
Lessons from the past
3.1.
The current system of
funding
The EU Programme for Employment and Social Solidarity - PROGRESS[57] supports the development and coordination of EU
employment and social policy. The programme helps the Commission to fulfil its
tasks both in the fields of (a) law-making, to ensure that evidence-based
legislation meets all the principles of Smart Regulation; and (b)
policy-coordination among the Member States. The total budget of the programme amounts to 683.25 million
€ for the programming period 2007-2013. It is spread over five broad policy
sections in the following manner[58]:
1.
Employment – 23%; 2.
Social protection and social
inclusion – 30%; 3.
Working conditions,
including restructuring – 10%; 4.
Anti-discrimination and
diversity – 23%[59]; 5.
Gender equality – 12%. PROGRESS finances three main types of actions: analytical
activities; mutual learning, awareness and dissemination activities; support
for main actors. The programme is directly managed by the Commission mainly
through calls for tenders, calls for
proposals and joint management. In the case of grants, the programme provides a
maximum of 80% co-financing. Set up in 1993[60],
EURES is a co-operation network between the European Commission and the
Public Employment Services of the EEA Member States (the EU countries plus Norway, Iceland and Liechtenstein) and other partner organisations. Switzerland also takes part in
EURES co-operation. The annual financial appropriations of EURES amount to € 21.3
million. EURES provides information, advice and
recruitment/placement (job-matching) services for the benefit of workers and
employers as well as for any citizen wishing to benefit from the principle of
the free movement of persons. The combined resources of EURES members and partner organisations
(Public employment services) have made it possible to develop EURES trough a
network of more than 5000 local employment offices with more than 5000 staff
offering EURES specialist services to jobseekers, job changers and employers. EURES
network also fosters European mobility via the internet platform http://eures.europa.eu. EURES
has demonstrated its European added value during the economic crisis by
increasing access to more employment opportunities and unfilled vacancy. The
number of visits on the EURES portal has almost doubled from 2008 to 2009 (from
17 500 000 to 33 750 000). The
EURES network has organised 705 events attended by 864.371 participants between
2006 and 2008. The aims of the European Progress Microfinance Facility
(Progress Microfinance)[61],
which was set up in 2010 as a response to the economic crisis, are twofold: on
the one hand, it makes microfinance within the EU more readily available and
accessible to persons who wish to become self-employed or start up or develop
micro-enterprises in that it enables microcredit providers in the EU to
increase their lending to them. On the other hand, it improves access to
microfinance by reducing the risk borne by microfinance institutions. This
allows providers to reach out to groups who could not normally be served, for
instance because they could not put up sufficient collateral or because the
interest rates would have to be very high if they were to reflect the real
risk. Progress Microfinance is jointly managed with the European
Investment Fund. It is a demand-driven instrument. The Union’s contribution is
EUR 100 million, of which EUR 25 million are used for guarantees to microcredit
providers, while the remaining EUR 75 million are earmarked for funded
instruments, i.e. debt, equity and funded risk-sharing instruments. For the
latter, a specialised investment fund has been set up. The Commission estimates
that the Union contribution, which is matched by the European Investment Bank,
will leverage a total volume of microloans of more than EUR 500 million over
eight years[62]. End of July 2011, seven institutions (in Belgium, the Netherlands, Poland, Bulgaria, Romania, Lithuania and Cyprus) had already signed
transactions under Progress Microfinance. By the end of 2011, 14 operations are
expected to be concluded. Up to now, there is no EU level financial instrument for
supporting the development and up-scaling of social enterprises.
3.2.
Achievements of the current
instruments and delivery issues
3.2.1.
The Progress programme
Achievements The interim results of the mid-term evaluation[63] and those of the
annual performance monitoring[64]
provide evidence of PROGRESS outcomes and offer insights about its delivery processes. PROGRESS allowed for Europe-wide comparison of evidence,
and for developing statistical tools, methods and common indicators to ensure
that EU employment and social policy and legislation are relevant to the needs
of Member States. Although the primary user of such outputs is the Commission
itself, there is evidence[65]
that these outputs are used in the EU and national policy- and law-making as
well as in the wider policy debate. Specific examples of policy evidence which was evaluated by
the respondents to the 2010 Annual Survey as being most helpful in different
PROGRESS policy areas include: ·
Employment section: Monthly Labour Market Monitor and Quarterly
Labour Market Review, ·
Social protection and social inclusion section: Collection of
statistics on income and living conditions, reports of the group of independent
experts on social inclusion and MISSOC database: Comparative Tables on Social
Protection, ·
Working conditions section: Non-binding guide to good practice for
implementing Directive 2003/10/EC, PROGRESS is the main financial instrument of the EU to
mutual learning and the exchange of good practices in employment and social
solidarity through the European Employment Strategy (EES) and the Open Method
of Coordination on Social Inclusion and Social Protection (Social OMC). These
processes have proven to provide factual information, influence agenda-setting,
enhance cooperation among national authorities and constitute a basis for
decision-making for participating Member States[66]. For instance, 22 Member States plus Norway and Serbia were actively involved in the Mutual Learning Programme in
2010. Main issues covered included self-employment, labour market integration
of the Roma community, support for the jobseekers and the unemployed, short
time working arrangements, ageing population and education choices, activation
of the elderly, and labour market integration of lone parents. PROGRESS strengthened partnership among policy makers and
stakeholders especially by contributing to the capacity building of key
non-governmental actors (EU-level networks and national NGOs). In particular, the outputs of key EU networks were seen by
a majority of stakeholders as beneficial for advocacy and partnerships[67]. For instance, in
2010, PROGRESS-supported key EU networks and NGOs produced 295 reports aimed at
providing policy advice, research and analysis, 179 reports aimed at
identifying good practices, and 235 reports aimed at monitoring/assessment in
the policy areas of anti-discrimination, social protection and social inclusion,
and gender equality. They also organised 316 training, peer review and other
mutual learning events, as well as 462 information and communication events.
The number of participants in those events increased by more than 50% from 21
901 in 2009 to 34 501 in 2010. Through PROGRESS, the Commission seeks to bring
about effective application of EU law on matters related to health and safety
at work, labour law, working conditions, non-discrimination and gender equality
in all Member States. First of all, PROGRESS contributed to improving
the quality of the Commission’s legislative initiatives by ensuring that they
are built on strong evidence[68]
as well as making its decision-making processes more accessible and involving a
broad range of stakeholders in policy development. For instance, in 2009,
PROGRESS contributed to several policy initiatives, including the agreement in
Council on the revision of Directive 86/613/EEC on equal treatment of
self-employed and assisting spouses and the Council decision for the European
Union to sign the UN Convention on the Rights of Persons with Disabilities.
Second, it helped to ensure correct and effective application of EU law in the
Member States by monitoring the implementation of EU law in the Member States
(by supporting networks of legal experts and external studies) and providing
assistance to the Member States (through trainings and mutual learning events
for legal practitioners) in transposing and applying EU law effectively. Delivery issues The mid-term evaluation finds that the PROGRESS programme's
annual cycle of planning, implementation, monitoring and evaluation of
activities is considered generally fitting, however it is recommended that a
multi-annual programming be developed to set more strategic long-term policy
objectives combined with annual funding priorities[69]. The evaluation confirms that the main types of activities
(analytical, mutual learning and support to main actors) are very relevant to
the programme objectives across its policy sections. The analytical outputs
analysed by evaluators are generally of good quality in terms of content and
usefulness. However, timeliness of delivery of studies should be improved by
greater use of framework contracts. In this context, the networks of experts
established in different PROGRESS policy sections proved to be effective in
providing the Commission with advice and research within shorter time periods[70]. Mutual learning and peer reviews seminars are highly
attended and generate considerable learning effects. However, the results of
both the mid-term evaluation and the annual performance monitoring confirm that
despite continued efforts in the last years, visibility and dissemination of
PROGRESS results deserve further improvement to ensure sustainability and the
long-term exploitation of funded projects. Another weakness of the current programme is the rigid
allocation of its budget to the policy sections. This rigidity made it harder
to effectively respond to political imperatives and changing circumstances, in
particular in the wake of the crisis. The successor instrument should drawn
lessons from this experience in order to strike a balance between
predictability and flexibility in its budget. Results-based management and regular
performance monitoring proved to be successful in demonstrating the programme’s
achievements as well as in enhancing the EU’s accountability. As confirmed by
the findings of the mid-term evaluation, the annual monitoring reports help in
keeping a constant focus on results by all stakeholders. The evaluators recommend
maintaining this approach; however, the administrative burden linked to the
annual reporting should be reduced. This could be done by reducing the number
of quantitative indicators at the output level and measuring the progress achieved
towards longer-term goals every three years instead of annually. Synergies between the programme and the European Social
Fund should be more fully exploited. For example, at EU level, coordination and
knowledge transfer should be improved between PROGRESS and the ESF in
particular in the framework of the Open Method of Coordination. Furthermore,
the ESF could help mainstreaming results of the PROGRESS projects, for example,
by drawing lessons from social experimentation projects and supporting replication
of this approach in the Member States. Lastly, despite some positive examples of integration of
the gender dimension into the programme activities, the mid-term evaluation
recommends putting more emphasis on the concrete implementation of this principle,
and ensuring that gender equality is mainstreamed in a meaningful way across
all PROGRESS-supported activities.
3.2.2.
EURES
Achievements An external evaluation of the functioning of the EURES
network[71]
revealed that in comparison to
other EU networks, EURES has a significantly stronger focus on employment
opportunities and it is also the only one that aims at providing specific
job-matching services. The EURES Job Mobility Portal is appreciated by
jobseekers, job changers and employers who clearly see the benefit in being
able to access – or post – information on vacancies across Europe. The surveys
with jobseekers and job changers and employers show that the job vacancies
database has facilitated job matching and intra-EU job mobility. More than 20%
of jobseekers and job changers that applied for vacancies of interest or posted
their CV on EURES reported having received a job via EURES, and just under half
of these identified that the resulting job corresponded to their skill level.
The CV set up function is viewed very positively by jobseekers and job
changers. This being said, one of the findings of the evaluation was
that the links between EURES aims and objectives, its
achieved outputs and the wider employment aims and objectives of the EU are not
prominent enough. The EURES objectives were broadly defined in 1993 and
stopped at the provision of information and virtual transparency[72] of labour markets
through clearance of vacancies and CVs. The EURES objectives do not make full
use of the exclusive competence provided by the TFEU in the field of free
movement of workers. The translation of strategic
objectives into operational objectives and its capacity to achieve and present
results needs to be improved. EURES
needs to focus more on tangible outcomes and results in terms of outgoing and
incoming placements and recruitment for example by helping young people and
employers to fill open bottleneck vacancies, i.e. vacancies for which
recruitment difficulties or market failure have been identified. These new
targeted labour mobility schemes are indeed much needed given the current
imbalances of EU labour markets which affect dramatically young people. "Your
first EURES job" scheme, currently implemented as a preparatory action, is
intended to foster youth job mobility across the EU-27 countries. Delivery issues There is a need to simplify and streamline EURES. Its founding
documents are composed of a Regulation, a Commission decision, a
"Charter" and three-year guidelines. Funding is distributed to the
network with a three year partnership agreement following a call for proposals (the
last one was published in 2010). Moreover, four different committees and bodies
supervise its functioning: the two committees created by Regulation 1612/68, a
EURES working party and the High Level Strategy Group, created by Commission
decision 2003/8/EC. As a result of this complex legal basis, the current
management of the network has become rather ineffective. The largest part of
the EURES budget (14 million €) is currently spent in direct management mode on
over 49 grants of the EURES network, following annual calls for proposals.
Management of the grants is cumbersome both on the side of the Commission and
of the beneficiaries, and is disproportionate compared to the budget available. Furthermore, the external evaluation revealed that with
regard to issues such as information on employment conditions and social
security, there were overlaps with other networks and programmes, notably with
Your Europe, Euraxess, SOLVIT and the European Social Fund[73]. There are also
some overlaps with the PROGRESS programme, in particular with its activities
relating to the Public Employment Services and labour market statistics.
Moreover, as a consequence of the ongoing liberalisation in the market for
labour services the market share of non-public employment services is
constantly growing[74]. Finally, EURES must provide itself with a monitoring and
assessment tool; to provide additional solid indicators about its performance
and its impact on the labour markets. On this point, a study has been
commissioned, and its results should be known in late September 2011.
3.2.3.
The European Progress
Microfinance Facility
Achievements Progress Microfinance was designed to address the lack of
access to finance, which is one of the main obstacles preventing people to
start their own business. Especially disadvantaged groups such as unemployed, young
or older people or migrants have difficulties securing traditional bank loans
(see problem definition under point 2.2.3). The European Progress Microfinance
Facility for employment and social inclusion extends the outreach of
microfinance to particular at-risk groups and to further support the
development of entrepreneurship, the social economy and micro-enterprises.
Progress Microfinance departed from the traditional grant-based approach and
has allowed pooling expertise and resources at European level and putting it at
the service of employment creation and poverty reduction in the Member States. Ministries of labour and social affairs are often less
experienced in the field of financial engineering. As a result only a small
number of managing authorities have used ESF resources for establishing
financial engineering instruments in the programming period 2007-2013. Given that
the establishment of such funds is time-consuming and complex and that a
critical mass is needed, a fund at EU level bears a strong added value: within
less than one year of the entry into force of the founding decision, the
guarantees window and the funded instruments window have become operational, by
July 2011 microfinance support is provided in seven Member States and the
forecast for transactions suggests that towards the end of 2011 Progress
Microfinance will increase accessibility and availability of microfinance in
half of the Member States. However, some weaknesses of the current setup have been
identified: In spite of the strong forecast for transactions, which
demonstrates the attractiveness of Progress Microfinance, up until now
microcredit providers have showed relatively little interest in the guarantees.
This was anticipated and hence reflected in the distribution of funds (1:3)
between the guarantees and the funded instruments from the outset, but
nevertheless absorption might be lower than anticipated. In addition, some microcredit providers lack the scale to
benefit from the support provided. For instance relatively small institutions
that had shown interest in the guarantees could not be served because their
loan volume was too small. They would have needed technical assistance and they
lacked the necessary funding to be eligible. The European Microfinance Network
(EMN) has also underlined this need for capacity building, especially for
non-bank microfinance institutions. Another area for improvement is related to the fact that in
some instances, especially in the Eastern European Member States, microcredit
providers offer only few or no business support services. This can be explained
by the fact that the provision of these services is particularly time-intensive
and hence costly. Especially commercially oriented microcredit institutions
therefore have difficulties providing these services, even though they are
obliged to at least cooperate with other organisations providing such services
under Progress Microfinance. A social innovation approach to microfinance would
strengthen the role of partnerships and strong linkages of microfinance
institutions with providers of business development services, facilitate their
integration in employment and social inclusion initiatives. Lastly, one of the target groups of Progress Microfinance
are social businesses in their start-op phase. However, it has become clear
that their specific nature (often a spin-off of a team from a traditional
business, or a civic society organisation, or a public service) requires a mix
of funding sources to get started, and that they face particular needs
regarding development, consolidation and growth (mezzanine and hybrid capital)[75]. The limitation of
microloans to amounts of up to EUR 25000 is in this regard problematic. To further
develop and consolidate. There is a clear need to exploit the social and
societal value generated by social enterprises. Given the low development of
national or regional sources of funding for social enterprise across Europe, there is a clear role for the EU to pave the way through a suitable EU level
instrument that has the capacity to leverage public sources of funding (notably
ESF) as well as mobilising private social impact investors. Delivery issues Several microcredit providers (e.g. MicroStart in
Belgium or Qredits in the Netherlands) supported by Progress
Microfinance have also benefitted from support for institutional capacity
building provided as part of a preparatory action of the European Parliament as
well as from training under JASMINE. However, while the combination of funding
and capacity building is addressing the needs of the sector, the current setup
is complex because the microcredit providers have to apply for different programmes.
It does not achieve the maximum value for money because the funding and the
capacity building are not linked. EMN indeed pleads for a streamlined and
combined support to financing and capacity building.
4.
Stakeholder consultations
In the context of the review of the current Progress
programme, the Commission organised a two-steps consultation: 1.
A working group gathering
the programme's key stakeholders representatives[76] was set up to
provide the Commission with a set of recommendations on the future instrument's
design, objectives, implementation and funding (the main recommendations are
presented below). 2.
A public online consultation
on a possible successor instrument to the Progress programme was carried out
between 4 April and 27 May 2011[77].
The key issues addressed were: designing the successor instrument to fit the
Europe 2020 Strategy, targeting the actions to maximise added value, improving
delivery mechanisms, and ensuring complementarity and coordination with other
policies and instruments. The consultation covered all Progress participating
countries (EU 27 Members States, EFTA/EEA countries, candidate and potential
candidate countries). Furthermore, given that Progress is implemented
through a results-based management approach, the Commission regularly monitors
the progress achieved towards expected results against clearly defined
performance indicators. In this context, an annual survey, targeted at policy
and decision-makers, social partners, NGOs and networks at both EU and Member
State levels is carried out to measure satisfaction with PROGRESS outputs and
the extent to which they contribute to meeting the programme's objectives. The
results are taken into account for designing the successor instrument. The 2011 meetings of EURES Working Party and
Heads of Public Employment Services (PES) held specific discussions on the
future on EURES. With regard to microfinance support, the Commission has
collected the views of the European Microfinance Network (EMN), which
represents the European microfinance sector, managing authorities of the ESF in
the context of the learning network on inclusive finance (Community of Practice
on inclusive entrepreneurship, CoPIE and specifically its working group on
access to finance) and of the European Investment Fund, which implements
Progress Microfinance on behalf of the Commission and the European Investment
Bank. Moreover the findings of two workshops organised by DG MARKT which
provided input into the Commission's Social Business Initiative and which covered
both microfinance and social entrepreneurship support have been taken into
account.
4.1.
The Progress programme
Feedback from both the Progress Key Stakeholder Working
Group and the above-mentioned public consultation revealed a high level of
satisfaction with the programme. Key stakeholders, who include next to the Member State representatives also social partner organisations and civil society organisations,
suggested continuing the programme as a stand-alone instrument, and its main
activities (analytical, mutual learning and support to main actors) with few
improvements relating to: -
The dissemination of the
PROGRESS outputs and results; -
Reporting requirements
placed on beneficiaries; -
A better mainstreaming of
gender equality and anti-discrimination objectives; -
Further synergies with other
EU financial instruments supporting the Inclusive Growth priority, in
particular the European Social Fund. None of 171 respondents to the public online consultation
challenged the need for a successor instrument to Progress. Respondents gave a
number of reasons why they believe there is a need for such a new EU financial
instrument: -
The financial crisis and its
impact on social protection and equality perspectives underscore the need for
enhanced coordination of employment and social policies across Europe. The successor to Progress should help to establish consensus on the right policy
approach on social problems through it support to the Open Method of
Coordination. -
An EU financial instrument
is an indispensible tool to enable transnational initiatives involving
stakeholders on all levels. Activities such as mutual learning and collecting
and comparing data from various Member States are seen to be vital to continue
improving the formulation and implementation of policies at EU and national
level. They are also seen as essential for improving understanding and
ownership of EU objectives. -
The future EU financial
instrument should have a clear focus on international cooperation and European
level actions and thus bringing about stronger EU dimension and complementarity
to the ESF. -
Many respondents (in
particular public authorities) emphasise the importance of monitoring the
application of EU legislation in the Member States and stress that this
objective should remain a key priority for the successor programme. Several respondents call for an integrated approach to
combat unemployment, social exclusion and poverty. In particular, 79% consider
that it is very relevant or relevant for the future instrument to support intra-EU
mobility as well as self-employment and entrepreneurship as means to job
creation. A number of respondents praised activities under the
current Progress programme that contributed to innovations in social policies
and confirmed that there was a need for social innovations to combat the
negative impacts of the financial crisis. They confirmed that very often
government programs in the field of social policy suffered from a lack of
robust evidence of what does and does not work. They suggested that the future
instrument should support social innovation through transnational projects.
Yet, identification and promotion of innovative approaches should be
accompanied by a sustainable implementation strategy. In this context, several
respondents indicated that where the successor instrument to Progress could
identify best practices, the implementation should be a matter for the ESF. Regarding the geographical coverage, respondents from
non-EU countries suggested that greater synergy between the new programme and
the ESF could limit the possibility to participate for EEA/EFTA countries and
candidate countries.
4.2.
EURES
The stakeholders' survey within the EURES evaluation[78] showed that the
EURES Job Mobility Portal is appreciated by jobseekers, job changers and employers
who clearly see the benefit in being able to access or post information on
vacancies across Europe. The opportunity to upload their CV onto the Portal was
considered the most useful service on the Job Mobility Portal. The EURES
adviser network adds value to the services provided on the Job Mobility Portal.
These two mechanisms complement and reinforce each other. Evidence from the
jobseekers and job changers survey indicated that those jobseekers and job
changers who applied for jobs and who received support from a EURES adviser
were slightly more likely to get a job than those who simply used the Job
Mobility Portal. It was also indicated that EURES plays a role in
individuals’ job search activities; hence can be considered as having a role in
minimising the costs of transitions between and into jobs. Evidence from the
jobseekers and job changers survey indicated that those jobseekers and job
changers who applied for jobs and who received support from a EURES adviser
were slightly more likely to get a job than those who simply used the Job
Mobility Portal. In addition, the longer a person had used the EURES services
increased the likelihood of them securing a job. The
adequacy and appropriateness of the data provided on the Job Mobility Portal
were however found questionable. While the views from managers and advisers
vary and tended to be negative; employers, jobseekers and job changers were
generally more positive about the available information. Responsibility
for the labour market information and information on living and working
conditions rests with the EURES members; hence concerns about the quality and
periodicity of data should be discussed by the network.
4.3.
The European Progress Microfinance Facility and
support to social enterprises
The
European Microfinance Network has pronounced itself in favour of a continuation
of support to microcredit providers like Progress Microfinance. However,
according to EMN, Progress Microfinance alone as an investment tool will have
limited impact on employment and enterprise creation without efficient and
sufficient intermediaries. Therefore a parallel investment in capacity building
is required to support the development of existing microfinance institutions
with growth potential and to support the emergence of new ones. JASMINE in its
current form has limited ability to change the state of play (in terms of
funding and scope of intervention). A long term capacity building instrument
for microfinance institutions is missing in connection to Progress Microfinance.
EMN pleads for the introduction of a new capacity building component into
Progress Microfinance that uses grants to finance innovation, institution
building and tools to develop the Microcredit sector as a whole. As
far as the setup is concerned, EMN calls for an improved coordination and
simplification of procedures, and in particular a better link between capacity
building and funding. Funding could then be made conditional on achievements in
terms of capacity building including aspects like covering governance and
management, institutional funding, technological development, portfolio
development, client outreach and risk management. On May 25-26 2011 the Commission services (DG MARKT)
organised a Workshop on "A European Ecosystem for Social Business"
which brought together more than 60 representatives of stakeholders and social
impact inventors, social entrepreneurs, and experts, to discuss key issues in
overcoming issue barriers to the development and growth of social enterprise,
and in particular to make recommendations for EU level action. Participants in
the workshop on microfinance highlighted that EU level action should: - Maintain/enhance the industry's reputation; - Cater for diversity; - Ensure sustainability of MFIs esp.
funding/expertise; - Base policy on accurate data/solid evidence. Specific action should include strategic
guidance on how best to establish efficient national frameworks for
micro-finance and by enabling the swapping of good practices; putting on the EU
and national agendas the key message that MFIs play a big role in helping
marginalised/unemployed especially in the context of spending cuts; all should
have access, and the establishment of open EU social business funds which could
finance MFIs as defined earlier, as well as other social businesses, and into
which retail as well as wholesale investors can invest in. Participants in the workshop on access to finance for
social business stressed the underdevelopment of the market for social
investment, characterised by a mismatch between supply and demand sides. Some
of the key factors mentioned were an insufficient investment readiness of
social enterprises, the need for patient capital, and a lack of market
infrastructure. In addition, social investors miss clear measurements for
social impact. The Commission was asked to support communication about
what social business is and where the successes of social business lie; to help
increasing the trust and confidence in the social business and social
investments and transparency in the market by supporting developments towards
standardised reporting or accounting, to strengthen the role of intermediaries
and facilitators between social business and capital, and the use EU funding
for developing the market for social investments, which again would be a strong
signal to the markets that this type of business deserves trust and would
therefore help to attract investors.
5.
Baseline scenario
In the case of the Progress programme, the baseline
scenario assumes that the current scheme is prolonged, with the same thematic
scope, but without the gender equality and anti-discrimination sections (to be
part of DG Justice Programmes[79]).
The budget reduced by 35% and the programme's deficiencies (in particular, rigid
financial allocation, administrative burden linked to annual monitoring) would mean
that the potential of the programme was significantly reduced. Policy coherence
between Progress activities, microfinance and social entrepreneurship support
and intra-EU mobility of workers (through EURES) would not be ensured in a
systematic way. In addition, social experimentation would not be given a
prominent place in the new programme through lack of a dedicated budget. As a
consequence, the development and
dissemination of social innovation approach on a larger scale in the European
Union would continue to be hampered by a number of obstacles (see section 2.1). In the case of EURES, the baseline scenario assumes
the continuation of the activities in the current form. EURES predates the European
Employment Strategy (1997) as well as the Lisbon strategy for Growth and Jobs
(2000). So the EURES objectives were broadly defined in 1968. They covered for
matching and placement; but did not attempt making full use of the European
exclusive competence provided by the Treaty in the field of free movement of
workers to improve labour market performance (matching and placement when there
is a market need e.g. bottleneck vacancies, niche vacancies, skills mismatches)
and consequently to advance the overall European employment situation. - EURES would not be modernised, which means it
could neither provide targeted mobility schemes (including the preparatory
action 'Your first EURES Job'), nor pursue a strategy of simplification of its
administrative structure. - EURES would not comply with the obligation to
specify in which form private Employment Services will be part of EURES 2020[80], thereby translating
the rulings of the European Court of Justice[81],
which has called for the opening of all placement services to competition. The baseline scenario anticipates a prolongation
of the current set-up: the European Progress Microfinance Facility would
continue to provide funded instruments to microcredit institutions as a
stand-alone instrument under joint management with the European Investment
Fund. No new resources would be made available, which would mean that the last
investment by the European Investment Fund would be made in 2016 as stipulated
by the Decision establishing Progress Microfinance. However,
the baseline scenario would only be partially satisfactory because support to
microcredit would stop in 2016 (guarantees until 2013) and no funding for
institutional capacity building would be available. According to EMN, there is a risk that Progress Microfinance does
not reach entrepreneurs and potential self employed people due a lack capacity
of microcredit providers in Europe and low ability of traditional financial
actors to deliver microfinance. The lack of capacity building would hence jeopardise the objective of bringing the
microcredit sector to maturity as quickly as possible to improve access to
finance especially for people in a vulnerable position. As outlined
above, restricting funding to social enterprises to the sole provision of
microcredit would not be effective for developing the sector and fully benefit
from its contribution to the achievement of the Europe 2020 targets.
6.
Objectives, expected results and
indicators for the programme
6.1.
The objectives of the
programme
The new programme will contribute to the implementation of
the Europe 2020 Strategy, its mutually reinforcing headline targets and
Integrated Guidelines by providing financial support for the European Union’s
objectives in terms of promoting a high level of employment, guaranteeing
adequate social protection, fighting against social exclusion and poverty and
improving working conditions. The Programme will seek to achieve the following general
objectives: (a)
Strengthen ownership of the Union objectives in
the employment, social and working conditions fields among key Union and
national policy-makers, as well as other interested parties in order to bring
about concrete and coordinated actions at both Union and Member State level; (b)
Support the development of adequate, accessible
and efficient social protection systems and labour markets and facilitate
policy reform, by promoting good governance, mutual learning and social innovation; (c)
Modernise Union law in line with the Smart
Regulation principles and ensure that Union law on matters relating to working
conditions is effectively applied; (d)
Promote workers’ geographical mobility and boost
employment opportunities by developing Union labour markets that are open and
accessible to all; (e)
Promote employment and social inclusion by
increasing the availability and accessibility of microfinance for vulnerable
groups and micro-enterprises, and by increasing access to finance for social
enterprises. In pursuing its objectives, the programme shall
aim to promote equality between men and women and combating discrimination
based on sex, racial or ethnic origin, religion or belief, disability, age or
sexual orientation. The programme shall also ensure
that the requirements linked to the promotion of a
high-level of employment, the guarantee of adequate social protection and the
fight against social exclusion are taken into account in the definition and
implementation of the Union's policies and activities. The results of the actions shall be suitably
communicated and disseminated in order to maximise their impact, sustainability
and EU added value. The following specific objectives will need to be
met in the future across the programme sections: PROGRESS section: 1.
Develop and disseminate high-quality comparative
analytical knowledge in order to ensure that Union employment and social policy
and working conditions legislation are based on sound evidence and are relevant
to needs, challenges and conditions in the individual Member States and other
participating countries; 2.
Facilitate effective and inclusive information-sharing,
mutual learning and dialogue on Union employment and social policy and working
conditions legislation at Union, national and international level in order to
assist the Member States and the other participating countries in developing their
policies and in implementing Union law; 3.
Provide policy-makers with financial support to
test social and labour market policy reforms, build up the main actors’
capacity to design and implement social experimentation, and make the relevant
knowledge and expertise accessible; 4.
Provide Union and national organisations with financial
support to step up their capacity to develop, promote and support the
implementation of Union employment and social policy and working conditions
legislation. EURES section: 5.
Ensure that job vacancies, job applications and
any related information are transparent for the potential applicants and the employers;
this shall be achieved through their exchange and dissemination at
transnational, interregional and cross-border level using standard
interoperability forms; 6.
Develop services for the recruitment and placing
of workers in employment through the clearance of vacancies and job applications
at European level; this shall cover all phases of placement, ranging from pre-recruitment
preparation to post-placement assistance with a view to the applicant’s successful
integration into the labour market; such services shall include targeted
mobility schemes to fill vacancies where labour market shortcomings have been
identified and/or help particular groups of workers such as young people. Microfinance and Social Entrepreneurship section: 1. Increase access to, and the availability
of, microfinance for: (a)
persons who have lost or are at risk of losing
their jobs, or who have difficulty in entering or re-entering the labour
market, persons at risk of social exclusion and vulnerable persons who are in a
disadvantaged position with regard to access to the conventional credit market
and who wish to start up or develop their own micro-enterprises; (b)
micro-enterprises, especially those which employ
persons as referred to in point (a); 2. Build up the institutional capacity of microcredit
providers; 3. Support the development of social enterprises, in
particular by facilitating access to finance.
6.2.
Definition of indicators
It is not always possible to find indicators which
adequately measure the intended objectives and benefits/effects of the
programme. In those cases the following types of indicators could be used: -
a leading indicator:
a well-designed programme will not
be limited to performance targets at the end of its implementation, but will
also specify intermediate targets to monitor progress. These so-called leading
or process indicators enable to determine whether the chosen
implementation strategy, reflected in the selected outputs, is effective and
progress is being made toward meeting the desired outcome. -
a proxy indicator: direct indicators are not always practical and can
require extensive and expensive data gathering; in such cases proxy indicators
may be used. Generally, proxy indicators may be used if (i) the result is not
directly observable, e.g., quality of policy or organisation development; (ii)
the cost of direct measurement is too high; and (iii) the result is achieved
after a long time. For these reasons a number of suggested indicators presented
below are indeed proxy indicators. The indicators designed for the general and specific
objectives are grouped into two categories: -
primary (core) indicators,
which are aimed to convey the key direction of the expected change under a
given objective (i.e., results, impact); -
secondary (facultative)
indicators, which supplement the first group indicators by adding additional
dimensions for their interpretation (i.e., efficiency, scope, other process-related
characteristics). There are also indicators intended to measure the extent to
which gender equality and anti-discrimination issues are addressed across the
programme's activities.
6.2.1.
Indicators for general
objectives
Considering
the time lag between the delivery of outputs and their impact on the longer
term (general) objectives, progress towards meeting these objectives should be
measured as a rule at three-yearly intervals. Indicators || Current situation || Long-term targets Strengthen ownership of the Union objectives in the employment, social and working conditions fields among key Union and national policy-makers, as well as other interested parties in order to bring about concrete and coordinated actions at both Union and Member State level Active participation of stakeholders at the EU and Member State levels in debating common challenges and taking concrete action to tackle them || There is no uniform method to measure the level of involvement of stakeholders in policy debate. Recent evaluations[82] have revealed that stakeholders' participation varies depending on policy issue and across the Member States. Latest Annual PROGRESS Performance Report suggests a tendency for authorities (EU, national, regional or local) to have closer ties with each other than with social partners and NGOs. || Equally active participation of all relevant stakeholders at the EU level and across all the Member States Acceptance of the relevant country-specific recommendations || The indicator is based on the Country-specific Recommendations which have been issued in June 2011 for the first time. The previous proxy measurement could be an assessment of how well did the Member States align their employment and social policies with the EU objectives (based on the Commission assessment of the previous NSRs and content of the previous Country-Specific Integrated Recommendations), which suggests that up to three quarters of the Member States have policy or strategies consistent with EU objectives. || All Member States accept the Country-specific Recommendations in the employment, social and working conditions fields (as attested by the strategies and policies reported in the subsequent National Reform Programmes) Support the development of adequate, accessible and efficient social protection systems and labour markets and facilitate policy reform, by promoting good governance, mutual learning and social innovation Incidence of up-take of social innovation results in the design and implementation of active labour market and social protection policies || Supporting social innovation is a new area of intervention. There is a lack of more systematic approach to full use of the social innovation results in active labour market and social protection policies. || Every Member State in its National Reform Programme reports at least one example of planned or actual up-take of available social innovation results in the design and implementation of its active labour market and social protection policies Awareness of social innovation || As above. || As above. Modernise Union law in line with the Smart Regulation principles and ensure that Union law on matters relating to working conditions is effectively applied Share of: (a) the legislative acquis (directives) comprehensively reviewed (b) resulting number of substantive proposals to revise (abandon, merge) existing or to initiate new legislation || (a) One directive (the Working Time Directive) is currently under review. (b) n/a. || (a) 100 % of directives on matters relating to working conditions are comprehensively reviewed by the end of the programme. (b) Wherever appropriate, the Commission would have initiated action to amend, clarify or simplify existing legislation or initiate the new one, if justified by an impact assessment, and, where relevant, after consulting EU social partners. Compliance in the Member States with EU legislation (transposition rate and fragmentation factor) || In 2010, the transposition rate was 98.3% for labour law directives and 100% for health and safety at work directives; the corresponding fragmentation factors were 5% and 0%. Historical analysis indicates that these rates tend to get worse after introduction of new legislation. In the light of possible Commission’s action to amend, clarify or simplify the existing or initiate the new legislation, it is important to maintain the high transposition factor and low fragmentation rate. || 100% transposition rate, and correspondingly low, 0% fragmentation factor Active implementation and enforcement || Currently, the presence of active implementation and enforcement is assessed qualitatively (through evaluations and networks of independent experts) and varies by directive and by country. || 100% of working conditions-related directives are actively implemented and enforced in almost all Member States (qualitative assessment) Promote workers’ geographical mobility and boost employment opportunities by developing Union labour markets that are open and accessible to all Impact of geographic mobility on MS' GDP || There are preliminary attempts to model and assess the impact for specific countries (i.e. UK ad Ireland) yet, they do not cover the entire Union. The Employment in Europe report 2008 estimated that mobility flows from the EU-8 have added an extra 0.4% to the Irish GDP and 0.3% to the UK’s GDP by 2007. || Impact of geographical mobility on MS's GDP is assessed for the entire Union and is positive. The long-run estimate forecasts an extra 1.7% to GDP in Ireland and 0.6% in the UK by 2015 compared with the pre-enlargement situation. Impact of geographical mobility on the reduction of unfilled/bottlenecks job vacancies, || There are preliminary attempts to model and assess the impact for specific countries, yet they do not cover the entire Union. || Impact of geographical mobility on the reduction of unfilled/bottleneck job vacancies is assessed for the entire Union and is positive. Difference in labour market participation and employment rates of mobile workers between the host country and the country of origin || Mobile workers in the sense of intra-EU mobility tend to have higher employment rates than non mobile workers. || Information will be made available from Eurostat's Labour Force Survey and other statistics. Promote employment and social inclusion by increasing the availability and accessibility of microfinance for vulnerable groups and micro-enterprises, and by increasing access to finance for social enterprises Number of businesses created or consolidated that have benefitted from EU support || 0 || 51000 (of which 1000 social enterprises) Number of jobs created or maintained through the establishment or development of a business || According to an evaluation of the CIP programme, per microloan provided, 1.2 jobs were created. || Profile of persons (age, gender, minority, employment status…) that have created or further developed a business with EU microfinance support || Not available || 50% of beneficiaries are unemployed people or from disadvantaged groups
6.2.2.
Indicators for specific
objectives
Progress towards
meeting specific objectives should be measured on an annual basis. Progress section For
the Progress section, it is impossible to make its four specific objectives
genuinely measurable while they are specific, accepted, realistic and
time-dependent. For instance, mutual learning events cannot be quantified
because their number and topics depend on Member States interests and will to
host such events and participate in them. The volume of knowledge produced
depends on the needs of policy development. These
objectives by their very nature are therefore assessable only by means of
subjective variables, like satisfaction of and knowledge among stakeholders,
surveys investigating on the perception of EU role in social and employment
policy debates as well as intended and actual use of outputs for policy-making.
For the similar reasons, it is not possible to provide medium-term targets. Nevertheless,
this approach remains in line with result based management which foresees
setting effective targets at a level close to the activity as such. Indicators || Latest known results || Medium term target Develop and disseminate high-quality comparative analytical knowledge in order to ensure that Union employment and social policy and working conditions legislation are based on sound evidence and are relevant to needs, challenges and conditions in the individual Member States and other participating countries Stakeholders satisfaction with and declared use of knowledge generated by the programme || Various stakeholders (Commission, EP, national administrations, implementing bodies, social partners, NGO, etc.) use the knowledge generated by the current Progress programme. Its 2010 Annual Survey indicates that those aware of the generated knowledge (about 50%) find it helpful (around 85% of responding stakeholders) and (plan to) use it. || Extend the scope of stakeholders who are aware of the knowledge generated by the programme (increased awareness of the key outputs: 75% of the responding stakeholders), and keep the high satisfaction rate (85% or more of responding stakeholders) Share of policy initiatives launched by DG EMPL which are informed by the knowledge generated by the Programme || Not available. || 100% of EU employment and social policy initiatives and action on working conditions legislation are informed by the knowledge generated by the Programme Share of effort[83] dedicated to development of new (previously inexistent) knowledge (ideas, concepts, approaches, models, forward-looking analysis) || There is no exact estimate, but the share of budget allocated to generation of the said type of knowledge is around 10-20% (the overall share of budget going to evidence-based policy is around 19%, with other parts of the programme focusing on dissemination, learning, capacity building and networking, which are primarily based on sharing the existing knowledge; also, not all support to evidence-based policy is targeted at development of new knowledge). This share is expected to grow, especially in the light of the emphasis on social innovation. || At least 25% off the budget is dedicated to development of new (previously inexistent) knowledge (ideas, concepts, approaches, models, forward-looking analysis) Facilitate effective and inclusive information-sharing, mutual learning and dialogue on Union employment and social policy and working conditions legislation at Union, national and international level in order to assist the Member States and the other participating countries in developing their policies and in implementing Union law The declared gain of better understanding of EU policies and objectives (including relevant gender and non-discrimination mainstreaming) || Around 89% of the respondents to 2010 Annual Survey claim to have gained better understanding of EU policy objectives by participating in Progress-funded events. || 9 out of 10 stakeholders claim to have gained better understanding of EU policies and objectives by participating in programme-funded events. The extent to which mutual learning/information sharing events are inclusive and meet minimum standards for consultation || The 2010 follow-up survey reveal that the Progress-funded mutual learning events are highly appreciated for the clarity of discussed issues and involvement of the relevant decision makers (4 out of 5 responding stakeholders express positive opinion), yet slightly less positive what concerns involvement of other stakeholders (social partners, NGOs, etc.). || 4 out of 5 stakeholders claim that mutual learning/information sharing events are inclusive and fully meet all the standards for consultation. The declared (intended/actual) use of acquired information for policy-making/advocacy by the involved participants but also other decision-makers and stakeholders || Ex-post survey of Progress-funded events in 2010 revealed that around 2/3 of participants intended or actually used the acquired information for policy making or advocacy. The essential challenge (especially in the case of mutual learning events) however is to promote the sharing of acquired information with other relevant decision makers and stakeholders (i.e., those, who did not participate). || - 3 out of 4 involved participants declare (intended/actual) use of acquired information. - Improved sharing of information with other decision makers and stakeholders (non-participants) Provide policy-makers with financial support to test social and labour market policy reforms, build up the main actors’ capacity to design and implement social experimentation, and make the relevant knowledge and expertise accessible The declared (intended/actual) use of acquired information for policy-making/advocacy and or further social experiments by involved participants but also other decision-makers and stakeholders || Supporting social innovation is a new area of intervention, so there is no baseline. || Due to novelty of this type of activity it could be expected that up to 2/3 of involved participants declared intended or actual use of information acquired through social experimentation for policy making/advocacy and or further social experiments. The presence of adequate conditions (financial resources, accessibility to relevant know-how and expertise) to design and implement social experiments in the field of EU employment and social policy: adequate capacity of the main actors || Supporting social innovation is a new area of intervention, so there is no baseline. || All the key preconditions (financial resources, accessibility to relevant know how and expertise, capacity of the main actors) to design and implement social experiments in the field of EU employment and social policy are assessed (e.g., by evaluation) as sufficient Provide Union and national organisations with financial support to step up their capacity to develop, promote and support the implementation of Union employment and social policy and working conditions legislation Strengthened organisations and networks being acknowledged as a useful source of information for the EU and MS policy and decision-makers and other stakeholders || There is no comprehensive baseline for all types of organisations and networks which are planned to be supported under the new programme. Currently (2011), there is only data that up to 9 in 10 of responding stakeholders in general, and some 3 out of 4 responding decision makers and officials in particular assess the best performing key EU networks and NGOs as a useful source of information. || The most assisted organisations and networks are acknowledged by 3 out of 4 surveyed decision-makers and other stakeholders as a useful source of information to on the EU and Member States' policy The declared change in capacity[84] to further develop, promote and support the implementation of EU employment and social policy and legislation by the participants (individuals or organisations, as relevant) involved in the supported capacity strengthening measures || There is no comprehensive baseline for this type of self-assessment by the participants (individuals or organisations, as relevant) involved in the supported capacity strengthening measures. The first results of similar performance measurements introduced by the Progress-funded key EU networks and NGOs indicate positive change, especially what concerns acquiring specific knowledge relevant to policy making and advocacy, with somewhat less success in improving internal organisation. || A uniform performance measurement system to monitor change in policy advocacy capacity introduced for all types of assisted organisations and networks 3 out of 4 participants involved in the supported capacity strengthening measures declare improved capacity to further develop, promote and support the implementation of EU employment and social policy and legislation EURES section Ensure that job vacancies and applications, and any related information are transparent for the potential applicants and the employers Total number of job vacancies and CVs on EURES Job Mobility Portal, currently the EURES portal hosts more than 1,000,000 job vacancies, and 600,000 CVs || Currently EURES portal hosts more than 1,000,000 job vacancies, and 600,000 CVs || The number of vacancies is expected to grow at a rate of 3% per year. Number of recruitment/ placements and job offers made through the EURES Job Mobility Portal || Currently estimated at 150.000 placements per year || The services responsible for EURES launched a study on "Evaluating Public Employment Services' performance measurement systems and recommendations on geographical mobility indicators" to indentify indicators for EURES 2020. Develop services for the recruitment and placing of workers in employment through the clearance of job vacancies and applications at European level Number of transnational placements facilitated by EURES. Increase the number of placements by 3% per year (currently estimated at 150.000 placements per year) || The Commission has only recently launched the preparatory action for the first targeted mobility scheme "Your first EURES job". According to estimates, it will contribute to the placement of 2000 to 3000 young workers. || See above Microfinance
and social entrepreneurship section Increase access to, and the availability of, microfinance Number of microloans provided by intermediaries to final beneficiaries with EU support. (50000 microloans provided by the end of the total investment period) || 0 || 50000 microloans provided by the end of the total investment period Volume of microloans provided in € (a total volume of 500 million, (corresponding to a leverage of 5 times the EU contribution) || Not available || A total volume of 500 million, (corresponding to a leverage of 5 x the EU contribution. Profile of final beneficiaries (age, gender, minority, employment status…) that have received a microloan with EU support. (50% of beneficiaries are unemployed people or from disadvantaged groups) || Not available || 50% of beneficiaries are unemployed people or from disadvantaged groups Build up the institutional capacity of microcredit providers Number of micro-credit providers supported through funding for capacity building (50 microcredit providers supported by the end of the support period) || || 50 microcredit providers supported by the end of the total investment period Level of institutional capacity in terms of funding, human resources, operational management as well as systems and infrastructure (Higher capacity of the sector compared to level identified in 2009) || In 2009, weaknesses in capacity building identified were difficulties to cover start-up and operative costs, underdeveloped systems for performance measurement and analysis, only average capacity levels regarding human resource management and a lack of capacity by non-bank microcredit providers for networking and co-operation[85] || Higher capacity of the sector compared to level identified in 2009 Support the development of social enterprises Number of social enterprises that have been supported through the initiative (1000 social enterprises supported ) || 0 || 900 social enterprises supported by the end of the total investment period Volume of investment provided to social enterprises (270 million, leading to a leverage of 3 times ) || 0 || 270 million, corresponding to a leverage of 3 times the EU contribution
7.
Alternative approaches
7.1.
Alternative delivery options
7.1.1.
The Progress programme
In
the case of the Progress programme two options can be envisaged: 1) Status quo
with some changes, and 2) merging Progress with other EMPL instruments
implemented through direct management. Option 1: The differences between this option and the baseline
scenario (= status quo) are: alignment of the programme objectives with Europe
2020 priorities; a strong emphasis on the promotion of gender and anti-discrimination
mainstreaming; more flexible financial allocation, focus on funding of larger
projects. Option 2: Integration into a new programme which provides for
continuation and development of activities currently carried out under Progress,
EURES and the European Microfinance Facility. The new programme is made up of three sections: 1.
PROGRESS, 2.
EURES and 3.
Microfinance/Social
Entrepreneurship. The new programme promotes innovative ways of responding to
long-standing social challenges linked to unemployment, poverty, ageing and
climate change. Namely, it creates
a sound knowledge base for the development of modern and effective policy and legislation in
the employment and social fields. Financial support is provided for identifying,
evaluating and scaling up of innovative solutions and practices to better assist the Member States in reforming
their labour market and social protection policies. It catalyses innovative partnerships
between public, private and third sector actors and supports their involvement in the definition and
implementation of new approaches to tackling social needs and societal
challenges. The programme also
promotes access to finance for social enterprises and their full participation
in society, thereby strengthening the involvement of the business sector in
social innovation processes.
7.1.2.
EURES
Option 1: Status
quo Option 2:
Reform EURES i.e.
Simplify
and rationalise its intervention logic by developing EURES services in
relation with both outgoing/incoming placements and recruitment services
where there is an economic need and will to fill open job vacancies, and
by including targeting mobility schemes.
Reform
its administrative management, via the restructuring of its activities
into a) vertical i.e. national and cross border activities under
"shared management" (ESF) ; b) horizontal i.e. EU level
activities under the new integrated direct management tool for PROGRESS.
Ensure
the consistency of its financial instruments in light of its new
organisational structure
Option 3: No
action at EU level
7.1.3.
Microfinance and Social
Entrepreneurship
For
the microfinance and the social entrepreneurship section, a distinction can be
made between options related to the content and those focused on delivery. Content options The
content options distinguish themselves by the scope of the action. Option
1: Continuation on the basis of the current setup (microfinance support alone) This
option would imply a new instrument along the lines of the current European
Progress Microfinance Facility. The geographical scope would remain the same,
i.e. it would be limited to microfinance institutions operating in the Member
States of the European Union. The
range of products would be the same as under Progress Microfinance, i.e.
including guarantees (as well as counter-guarantees) implemented through a
cascade of financial institutions by the European Investment Fund under a
fiduciary management agreement concluded with the European Commission and
funded instruments (direct and indirect equity, senior loans, subordinated
loans, funded risk-sharing instruments) delivered by a specialised investment
fund, with the EIF as management company and the Commission and the European
Investment Bank as investors (with the possibility of other third investors). Option
2: Widened scope to include capacity building and with extended geographical
coverage (microfinance support) This
option foresees an extension of the scope both in terms of geographical
coverage and content compared to the current setup. The new instrument would
support microfinance not only within the EU, but also in the EFTA/EEA
countries, the accession and candidate countries.. In
terms of content, funding for capacity building would be added. This could be
done in two ways: Funding
would be provided in the form of equity and loans. This would be very similar
to the funding provided as part of a current preparatory action of the European
Parliament under JASMINE[86].
In addition to the equity investments and loans, grants could be provided to
microcredit providers. This could be done in the form a certain amount per loan
provided (as currently done under CIP). Option
3: Widened scope for microfinance support to include capacity building, with
extended geographical coverage, complemented by dedicated support for developing
social enterprise As
option 2, this scenario foresees and extension of the geographical coverage to
the EFTA/EEA countries, the accession and candidate countries. In terms of
content, funding for capacity building including through grants would be
provided (like under option 2). In addition, support in the form of investments
into social funds would be made available to support the development of social
enterprises. Delivery options The
delivery options distinguish themselves by the degree of flexibility /
standardisation. Option
A: Continuation on the basis of the current setup This
option would imply joint management of the new instrument with the European
Investment Fund on the basis of a new/renegotiated Fiduciary and Management
Agreement for the guarantees and the current specialised investment fund for
the funded instruments. The new facility would continue to be a stand-alone
instrument. Option
B: Direct management by the Commission within an integrated programme of DG
EMPL Under
this option, the new instrument would be directly managed by the Commission as
part of the integrated programme for employment and social inclusion instead of
being managed jointly with the EIF. The Commission would have to find partners
through a call for tenders. No standardisation of the process through equity
and debt platforms would take place. Option
C: Joint management and establishment of a dedicated investment vehicle within
an integrated programme of DG EMPL This
option foresees that the new instrument is jointly managed with the European
Investment Fund. In addition to the guarantee window, a dedicated investment
vehicle will be established for the delivery of the funded instruments. The new
instrument would be part of the integrated programme for employment and social
inclusion. The dedicated investment vehicle would be put in place on the basis
of the Commission's equity and debt platforms and open to ring-fenced
compartments from Member States and regions under the European Social Fund.
7.2.
Detailed assessment of
options
7.2.1.
PROGRESS
Option 1
would on the one hand provide for the continuation of Progress as
stand-alone instrument supporting the development, coordination and monitoring
of EU employment and social policy and legislation, and, on the other hand, for
a number of improvements. Namely, the
objectives of the renewed instrument would be optimally aligned on Europe 2020
priorities. Its thematic scope would be limited to the employment, working
conditions, social protection and social inclusion areas; however, in pursuing
its objectives, the programme would promote gender equality and
anti-discrimination dimensions. The programme would carry on with funding of
its traditional types of actions (analytical and mutual learning activities,
and support to main actors) which are considered as effective in meeting the
programme’s objectives[87].
Without the gender equality and anti-discrimination sections, the new programme
would also be much smaller and as such would not have the critical mass needed
to achieve its policy objectives. However, some improvements at management level would
increase the programme’s efficiency and effectiveness. In particular, the rigid
allocation of the Progress budget to its different policy sections would be suppressed.
The Commission would thus be able to better respond to
political imperatives and changing circumstances. As recommended by the
mid-term evaluation, a multi-annual programming would be developed to set more
strategic long-term policy objectives combined with annual funding priorities. Results-based
management approach with its focus on regularly measuring progress towards the
programme objectives would be maintained; however, reporting requirements
placed on beneficiaries would be reduced. This measure would be in line with
the results of stakeholder consultation. Lastly, the dissemination of the
programme results would be significantly improved in order to ensure better
sharing of knowledge and sustainability of EU action. The main advantage of Option 2 is a high degree of
rationalisation of EMPL financial tools. This option would enable the
Commission to increase policy coherence and impact of its instruments which
pursue common objectives in the employment, social affairs and inclusion fields,
i.e. Progress, EURES and the European Microfinance Facility contribute to the
implementation of the European Employment Strategy. In addition, the current
Progress programme (2007-2014) already promotes a number of activities linked
to labour mobility and relevant for EURES activities (such as cooperation
between the Heads of Public Employment Services, funding of the European
employment observatory, ESCO[88],
several studies and statistics on matching skills and jobs, etc.). It also
finances the operating costs of the European Microfinance Network which
promotes the use of the Microfinance Facility. Further complementarity between
these three instruments is therefore essential. In particular, the aim of
improving self-employment cannot be achieved in isolation from other policies,
supported through the Progress programme. Namely, it requires a more stable
economic environment, a shift from subsidised financing to capacity
development, a reduction of the administrative burden and labour costs, an
increased focus on flexicurity, fostering lifelong learning, and better
research and evaluation. Harmonising the rights of self-employed workers with
those of employed individuals, including social protection, provides greater
legal security to both employed and self-employed workers. This option would therefore be in line with the Budget
Review Communication calling for both integrated instruments and a strong
coordination to deliver the Europe 2020 objectives. Across its three sections (Progress, EURES and Microfinance
and Social Entrepreneurship), the new programme would promote innovative ways
of tackling
social needs and societal challenges. Actions under the Progress section will
aim at speeding up mutual learning, building commitment to EU employment and
social objectives, supporting innovative partnerships (between public, private
and third sector actors) and establishing a sound knowledge and evidence base
for policy-making. These types of activities are in accordance with the
programme's legal basis[89]
and the EU's role in the employment and social policy fields (mainly to act as
a catalyst for change, facilitate co-operation between Member States and ensure
correct implementation of EU law as Guardian of the Treaty). In addition, the Progress section would
provide for increased funding for social
experimentation in particular through awareness raising and mutual learning
activities, capacity building and grants for projects designed by public
authorities to test reforms of their social protection and active labour market
policies and social services delivery systems[90].
Gender and anti-discrimination mainstreaming would be promoted in all sections[91]. This thematic scope would be
in line with both the recommendations of PROGRESS stakeholder working group and
the view of the respondents to the public consultation[92]. Regarding possible improvements at management level, they
would be the same as under Option 1. In addition, the new programme will focus
on large projects with clear EU added value in order to reach critical mass and
reduce administrative burden. Harmonised and simplified rules and procedures
will be put in place to facilitate access to the programme, in particular for
small organisations.
7.2.2.
EURES
Option
1: Under this option, EURES
continues and no action is taken to address in particular the issue relating to
EURES administrative structure which is complex and needs revision and
streamlining. Notably, there is a need to harmonise and update the implementation provisions regarding the
clearance of vacancies and application for employment, the definition of the
operational objectives of EURES services, the composition and governance of the
EURES network, the quality standards and exchange of information/best
practices. These reforms will ensure consistency between the different parts of
EURES in line with the new MFF instruments. Option 2 is the preferred option as it would allow for advancing
the reform of EURES. Under this option, EU-level and horizontal actions of
EURES would be carried out as part of a new programme for direct management, bringing
together Progress, EURES network and the Microfinance Facility. In addition,
the new Regulation for the European Social Fund would incorporate EURES
national (vertical) and cross-border activities as a specific shared management
component so as to ensure that the Member States develop EURES at national
level according to the priorities of the European Employment Strategy. Both new legislative acts would thus provide for
legal bases for EURES expenditures, including the financial incentives provided
for under 'Your First EURES Job' while coupling the financing of EURES with the
definition of its modern activities as spelled out in a new Commission Decision
thereby making full use of Article 44 of the Council Regulation 1612/68:
"The Commission shall adopt measures pursuant to this Regulation for its
implementation. To this end, it shall act in close cooperation with the central
public authorities of the Member States". In this context, the new focus of EURES would be
to: -
Develop EU-level EURES
services related to both outgoing and incoming placements (when there is an
economic need to fill job vacancies and where EURES has the capacity of
handling such market activities); -
Expand EURES scope to
support targeted mobility schemes[93]
at EU level to a) fill bottleneck and niches vacancies (where market failure
have been identified), b) to help specific groups of workers (such as young
people) and countries which are or will become recipients of mobile workers; -
Get Public Employment
Services (PES)[94]
and Private Employment services to systematically cooperate when delivering
EURES actions; -
Specify in which form
private Employment Services will be part of EURES 2020, hence translating the
rulings of the European Court of Justice which has called for the opening of
all placement services to competition. However, PES should remain the main
actors of EURES so as to ensure that Member States fulfil all their legal EURES
transparency obligations as stipulated under Council Regulation 1612/68. This option would allow EURES to become a genuine result
oriented matching tool going well beyond its original role as a transparency
device. Under option 3 EURES-related national and cross-border activities would be carried out
only by the Member States; no action would be undertaken at EU level. This
option would lead to savings in EU budget but at the same time it would mean
that Member States would act individually. As a result, some Member States
would invest more to attract talents in order to fill in their bottleneck vacancies.
Lack of coordination between employment services would cause unnecessary costs
and could lead to mobility being perceived mainly as a matter of competition
for talents/skills, potentially leading to frictions between the Member States or cuts in skill investments. The
potential cost of discontinuing such transparency tools as the EURES portal, on
which 1 000 000 job vacancies and more than 500 000 CVs are
currently posted, would be higher than the cost of maintaining it, particularly
given its results to date (see Section 3.2.2.). Limited information and
uninformed choices by both companies and jobseekers, and higher
job-search/recruitment costs could have negative economic consequences. Mobility
in the EU would be more difficult, transparency of labour markets would not be
anymore ensured. It should be noted that research has shown that greater
geographical and labour mobility is associated with higher GDP, higher
employment and lower long-term unemployment.
7.2.3.
Microfinance and Social Entrepreneurship
Content options Option
1: Continuation of the basis of the current setup Based
upon the experience so far with Progress Microfinance, the range of funded
instruments offered under this instrument is attractive for the European
microcredit sector. Under Progress Microfinance, it has allowed to reach out to
a great variety of intermediaries, non-bank microcredit providers, banks, and
small banks, which, in turn, makes an outreach to different groups of final
beneficiaries likely: senior loans are typically interesting for small
institutions that need loan capital for on-lending as microcredit. Subordinated
loans can be especially helpful for small banks with an intention to further
scale down into the microfinance segment, in particular in Central European
countries. While senior financing does not fit their needs, because they rely
on intra-group lending from the parent company, subordinated loans can address
the scarcity of capital resources which often limits their growth aspirations.
A small allocation to direct equity allows for funding of some greenfield initiatives. Indirect equity, i.e. equity which is channelled through a central
body to a network of local or regional intermediaries, increases the outreach
because it allows a group of small intermediaries to pool their resources
together and reach the necessary critical mass. This
intermediary/sub-intermediary model has also proved attractive for the other
products. The
guarantees had been included in Progress Microfinance to serve the needs of
commercial banks, savings banks, cooperative banks and larger non-bank
microfinance institutions. Considering the transactions under Progress
Microfinance and the forecast for transactions, the guarantees seem to be truly
complementary to the funded instruments in the sense that they increase the
geographical coverage: in the countries in which guarantee operations are
planned or have already been concluded (mostly Western Europe), intermediaries
have not shown interest in funded instruments so far. The guarantees therefore
contribute to achieving a regional balance between Eastern and Western Europe. Option
1 would not improve the situation with regard to developing the microfinance
market, nor provide a real support to social enterprises. For
microfinance support, this could jeopardise the aim of making more microcredit
available, especially to people from disadvantaged groups because the
absorption capacity of the market may not be sufficient: microcredit providers
would continue facing difficulties with making investments to improve outreach,
management, performance and infrastructure. The situation would be worse than
in the current programming period in which at least a small amount of funds
made available in the framework of the European Parliament Preparatory Action
have been used to support capacity building of a number of microcredit
providers. Option
1 would also not adequately address the lack of access to finance that social
enterprises face for development and consolidation: even though social
enterprises could remain part of the final beneficiaries targeted by Progress
Microfinance, it has become obvious that microloans alone will not be
sufficient to influence significantly the start-up of social enterprises and
the development of the sector. As
far as the geographical scope is concerned, maintaining the status quo, i.e.
covering only the 27 Member States would leave a gap in support to microcredit
in the EFTA/EEA, the candidate and accession countries. Under the current
programming period, the microfinance support (in the form of guarantees) of the
Commission's Competitiveness and Innovation Programme (CIP) is open to all
these countries. With a view to simplification and avoidance of overlaps
between EU initiatives, the successor programme of CIP will focus on SME
finance, leaving the microfinance segment to the successor of Progress
Microfinance. Without an extension of the scope, these countries could in the
future not benefit from EU support to microfinance anymore. Option
2: Widened scope to include capacity building and with extended geographical
coverage While
option 2 enjoys the same benefits as option 1, but also addresses some of its
weaknesses: Firstly,
it would tackle the problems of complementarity with the CIP programme: an
extension of the geographical scope would also allow businesses, especially
micro-enterprises, in the EFTA/EEA countries, the accession and candidate
countries, to benefit from EU support to microfinance[95]. In
terms of content, funding for capacity building would be added. The latter
would be provided in the form of equity and/or loans, as had been successfully
done under the preparatory action of the European Parliament under JASMINE[96]. This would enable
building stronger microcredit providers in Europe that can serve more clients
and cover the growing unmet demand by micro-enterprises, unemployed and
excluded persons in Europe. In
addition to the equity investments and loans, grants could be provided to
microcredit providers. This could be done in the form a certain amount per loan
given out and made conditional on the provision of training and mentoring
and/or serving particularly vulnerable groups. This would provide an incentive
to make microcredit available also to risky groups and address the problem of
costly support services, which cannot become sustainable, as even fervent
advocators of self-sustainability of microcredit providers admit[97]. Option
3: Widened scope for microfinance support to include capacity building with
extended geographical coverage, complemented by dedicated support for
developing and expanding social enterprises This
option has the same scope as option 2. Funding for capacity building including
through grants would be provided (like option 2b). The advantages would
therefore be the same. The
main advantage of this option in comparison to option 2 would be the
introduction of specific and targeted support for social enterprises going
beyond the current, insufficient set-up, where the funding is limited to the
start-up phase and amounts for microcredit (loans of up to € 25000). The
dedicated support would address the specific needs of the social enterprises
and make more substantial funding available allowing social enterprises to
develop and grow. The Programme will thus also address market imperfections
and externalities in the social investment markets. Currently, these are highly
fragmented, diversified and underdeveloped due to specific supply and demand
side barriers. The dedicated support at EU level will serve as catalyst for
public private partnerships in member states and regions in establishing
suitable social investment funds, and embed these in a broader strategy for
supporting social enterprise through measures financed from the Structural
Funds. Overcoming the key barrier of access to finance will strengthen the role
of social enterprises as drivers of social innovation processes, and it enhance
their innovative capability as these are experimenting with alternative ways
of responding to societal needs and meeting social values, by producing
innovative of products and services, introducing innovative production
processes and means of service delivery, changing value chains, introducing new
standards and norms, and developing new interfaces and linkages between
sectors. Delivery options Option
A: Continuation on the basis of the current setup This
option would have the advantage of being easy and relatively quick to establish
because the new instruments could be negotiated with the EIF on the basis of
the existing mandates. The know-how built up by the EIF under the current
instrument could be used, including work on the pipeline (which would also
speed up delivery). The centralised management by the EIF would also respond to
the requests of the sector and the European Parliament to create a
one-stop-shop for microfinance support in the EU. However, for implementing the
social entrepreneurship support, a new set-up would have to be created. Option
B: Direct management by the Commission within an integrated programme of DG
EMPL Under
this option, the new instrument would be directly managed by the Commission
instead of being managed jointly with the EIF. However, the Commission would
not have the expertise nor be given the resources to manage a fund on a
day-to-day basis. This option can therefore not be considered realistic. Option
C: Joint management and establishment of a dedicated investment vehicle within
an integrated programme of DG EMPL This
option foresees that the new instrument is jointly managed with the European
Investment Fund as under option A. Instead of being a stand alone instrument,
as under option A, it would be part of the integrated programme for employment
and social inclusion. Besides the advantages already described under option A,
the inclusion of this specific initiative in the integrated programme will
facilitate complementarity between the activities the Commission carries out under
the PROGRESS section (such raising awareness, exchange of good practice, social
experimentation, establishing a sound knowledge and evidence base and
developing robust tools, notably for experimentation and measuring impact ) and
the support provided by the EIF on behalf of the Commission. Opening the
dedicated investment vehicle to contributions from Member States and regions
with ESF resources (in the form of ring-fenced compartments in the investment
vehicle) would also make the benefits of a centralised EU level instrument,
established with the know-how of the EIF and the experience gained with
Progress Microfinance, available for the Member States. The exact delivery mode
of the funding for capacity building through grants will need further exploration.
The
financial instruments facilitating access to finance for social enterprises
will be implemented through structures and procedures similar to the ones for
the Microfinance facility (i.e. guarantees, counter-guarantees and risk-sharing
instruments; equity instruments; debt instruments; and grants), taking into
account the diversity, fragmentation and different degrees of development of
the social investment markets. It will therefore be highly experimental, and
will require an accompanying learning evaluation to have sound data for
adjusting implementation parameters to the needs and requirements of the
financial intermediaries using the EU level financial instruments.
7.3.
Consideration of "no
action"
Without EU funding available through the Progress
programme, which proved working as a an effective tool supporting the
development of EU employment and social policy, EU ability to promote and
facilitate reforms, as well as to
empower stakeholders who have a crucial role to play in the delivery of reform
would be severely reduced. In EURES
case, no support to intra-EU-mobility would be in contradiction with Article 46
of the TFEU which imposes an obligation to act ("shall… issue directives
or make regulations to bring about freedom of movement") and would
contradict the economic rationale that increased mobility flows can add an
extra to GDP and that geographic mobility can serve as an adjustment mechanism
between labour market out of balance. For
the microfinance and social entrepreneurship, the "no action"
option would be equal to the baseline scenario.
7.4.
The favoured delivery option
Option 2 is the preferred option for the Progress programme
as it would bring about the following benefits: -
Efficiency gains, compared to option 1 (current
situation with some improvements), in terms of a considerable rationalisation
of EMPL direct management instruments, streamlining of their management rules and
procedures and ensuring flexibility in allocating resources to changing policy
priorities. -
Critical mass: the integrated programme would be a
medium-sized EU instrument able to reach the critical mass needed to achieve
its policy objectives. -
Coherence and
effectiveness: bringing
together all three direct management instruments which pursue common objectives
in the employment, social policy and inclusion fields, would enable the
Commission to increase policy coherence and impact of its actions. For EURES, the favoured option is option
2. The
favoured option for microfinance and entrepreneurship support is option
3C combining the benefits of the experience with the current Progress
Microfinance instrument with the enlarged scope and dedicated, customised,
support for social enterprises. As
a result, the Commission proposes to establish an integrated programme bringing
together these three financial instruments. It will be made up of three sections:
1. The Progress section, which shall support
the development, implementation and monitoring of EU employment and social
policy and legislation on working conditions and promote evidence-based
policy-making and innovation, in partnership with the social partners, civil
society organisations and other interested parties; 2. The EURES section, which shall support
activities carried out by the EURES network, i.e. the specialist services
designated by the Member States, together with other interested parties, to
develop information exchanges and dissemination and other forms of cooperation
to promote workers’ geographical and occupational mobility; 3. The Microfinance and Social Entrepreneurship
section, which shall facilitate access to finance for entrepreneurs, especially
those furthest from the labour market, and social enterprises.
7.5.
Risk assessment of the
favoured delivery option
Risks relating to the financial management Under the Progress, centralised direct
management will involve (a) the attribution of numerous contracts and grants
for specific activities (relevant also for the EURES section), and (b) the
payment of numerous operating grants to non-governmental organisations; (c)
cooperation with international organisations (relevant also for the
Microfinance and Social Entrepreneurship section implemented in accordance with Joint management mode).
The main risk will be relating to the capacity of (especially) smaller
organisations to effectively control expenditure as well as to ensure the transparency of operations carried out. DG EMPL
concludes grant agreements directly with beneficiaries who co-finance the
project costs. The period of execution of the subsidised projects is usually
between one and two years. Budgets allocated at the award stage are indicative
only, and the amounts paid are always provisional and subject to recovery if
they are not in line with actual costs. Finalised granted projects will be
subject to ex post controls. The strategy of ex-post audit will be: (a) to
combine the risk assessment and ad random selection in order to avoid a too
rigid selection process, and (b) to pay attention to operational aspects
whenever possible during the on-the-spot audit. As far as the international
organisations are concerned, they will
be obliged to, in their accounting, audit, internal control and procurement
procedures, apply standards which offer guarantees equivalent to
internationally accepted standards. In addition, individual agreements
concluded with the international organisations for the award of financing shall
contain detailed provisions for the implementation of the tasks entrusted to
such international organisations. They will also ensure adequate annual ex post
publication of beneficiaries of funds deriving from the budget. Risks relating to the operational management As every financial instrument involving calls for
proposals, a European programme promoting and financing social experiments
relies for a large part on the initiatives taken by the potential project
leaders. The main risks that could thus be identified are the following: -
Insufficient demand for a
programme with this scope, reflected in no or a very low number of
applications. This could be because the concept of "social
experimentation" for some constituencies carries negative connotations,
thereby stifling interest. Or, when the intended scope is well understood, it
can be felt among potential promoters to be too costly, or simply not a
relevant approach; -
On the content: the projects
submitted are not very innovative, lack rationale in their focus, or are not
well-suited for the methodology and/or for an envisaged up-scaling; -
The methodology applied is
not what is generally defined as a social experimentation (evaluation is not
robust enough, etc.). To avoid the first and the third risks, it is indispensable
to promote and develop social experimentation at EU level through awareness
raising and capacity building actions. Member States, civil society
organisations and other actors may also need to be reassured on the concept,
and on the objective behind, i.e. that it is not a way to dismantle social
services but a useful tool to build more effective, better targeted policies in
partnership with all relevant actors. On the second risk, exchanges in established processes for
policy coordination and mutual learning will help ensure that the measure
tested is relevant in terms of policy options. The
main element of the risk assessment is to examine if the funding provided for
under the EURES section of the new programme can deliver the expected
results in terms of placements and information provision and how further
synergies with other PROGRESS sections can be developed in order facilitate the
implementation of the employment guidelines. On
the basis of historic records and EURES results so far (see section 4.2.), the
risk should be assessed as medium-to-low. It can be further minimised by taking
the corrective action with regard to the suggested revision and update of the
COM decision (2003/8/EC) and
further mainstreaming of geographical mobility in the European Social fund. One
of the main risks for microfinance and entrepreneurship support through the
programme would be a low quality of the interface with the parallel and
connected development of funding and capacity building of the microcredit
sector. In case the capacity building is not effective enough, there will be
insufficient funding absorption capacity of the microcredit market. This could
jeopardise reaching the targets of the instrument in terms of number of loans
and total loan volume. Regarding
the financial instrument to support the development of social enterprise, a
potential risks would be the slow establishment of social investment funds that
could absorb the EU level funding opportunities.
8.
EU added value of the intervention
The new programme will enable the Commission to increase policy coherence and
impact of its instruments which pursue common objectives in the employment, inclusion,
and social affairs fields, i.e. Progress, EURES as well as the Microfinance and
Social Entrepreneurship contribute to the implementation of the Europe 2020
Strategy, its relevant headline targets (for employment, fight against poverty
and education) and the Integrated Guidelines 7, 8 and 10, while supporting the
implementation of the flagship initiatives, with special regard to the European
Platform against Poverty and Social Exclusion, An agenda for New Skills and
Jobs and Youth on the Move. In particular, the new instrument would bring about
EU added value in the following ways: The EU is uniquely placed to provide a European
platform for policy exchange and mutual learning processes between the Member
States (also including the EEA and candidate countries) in the employment and
social area. Knowledge of the policies carried out in other countries broadens
the range of options available to policy makers, triggers new policy
developments and encourages national reforms[98].
Finally, it brings benefits in terms of improving the governance of the EU
employment and social policy. The EU action adds value to national interventions by providing
a European reference gathering and comparing evidence, developing statistical
tools and methods and common indicators to allow for a complete picture of the
situation prevailing in the employment and social fields at European level. This is a prerequisite for a sound analysis of
the key employment and social challenges facing each Member State. The monitoring of progress towards the Europe 2020 targets, including relevant
country-specific recommendations in the framework of the European Semester should be based on that analysis. The need for better application of EU law has
been recognised as a key priority under the Smart Regulation agenda. The EU
level is the most appropriate for modernising a legal framework, aiming to
create a level playing-field and to guarantee a common level of EU legal
protection for all in the fields of health and safety at work and labour law.
The EU is also uniquely placed to finance measures aimed at improving
compliance with EU rules as well as providing systematic review of the EU
legislation application across the Member States. Developing the capacity of key European level
civil-society networks to support and further develop the Union social policy
goals can best be achieved at EU level. An improved EURES would facilitate labour market
mobility. Member States would benefit as bottleneck or hard-to-fill vacancies
could be filled by intra-EU-mobility, leading to increased economic activity
and thus contributing to economic growth. Furthermore more European labour
market mobility could also foster a European citizenship which goes beyond
national interests. The Member States would benefit from greater
intra-EU labour market mobility, which could help fill bottleneck or
hard-to-fill vacancies and thus bolster economic activity and contribute to
economic growth. Greater European labour market mobility is also essential for the
completion of an area without internal frontiers and for the strengthening of
economic and social cohesion and active European citizenship. The EU
institutions, and in particular the Commission, which has the administrative resources,
expertise and capability to coordinate a transnational network such as EURES,
should therefore support and facilitate action to bolster geographical labour
mobility. The Commission can also add value to the EURES network by developing
policies to overcome remaining obstacles to free movement, facilitating
exchanges of good practice and ensure mutual learning between EURES network
members. An increase in the availability of microcredit
is best achieved at the European level: firstly, the European Commission in
cooperation with the European Investment Fund has already gathered experience
with the current microfinance facility, the JASMINE pilot project and the EPPA
initiative requested by the European Parliament. Microfinance institutions in
all Member States can now benefit from this expertise without their national,
regional or local authorities having to use resources to put in place similar
systems. The EU level instrument facilitating
access to finance for social enterprise will have a multiplier effect as it
will pave the way for enhanced public and private action at national and
regional levels in the years to come. It is expected that the EU level
instrument will contribute to increasing the scale of social business
operations through removing barriers to finance, which would both stimulate the
creation of more social enterprises, and allow existing ones to exploit
opportunities for growth; to increase the geographical scope of social
investment funds and social finance intermediaries currently operating only in
a few member states and at low levels; to stimulate the development and use of
innovative financial instruments, facilitate mutual learning across national
borders, and to contribute to building sustainable and professional capacities
for social impact investments. In addition, the financial resources pooled
together at the European level are more likely to attract additional funding
from third investors like the European Investment Bank who, in the case of
Progress Microfinance, matched the EU contribution of 100 million. The same is
true for an EU level equity fund for investments in social enterprises: it can
be expected that it will attract more resources from other investors.
9.
Cost-effectiveness of the proposed option
The new programme bringing together Progress,
EURES and the European microfinance activities will allow for continuation of a
number of activities proved being efficient and effective in meeting the
objectives of these three financial instruments. In addition, it will provide
for the development of new actions, such as social experimentation under the
Progress section, recruitment/placement under the EURES targeted mobility
scheme and support to social enterprises under the microfinance and social
entrepreneurship section. The cost-effectiveness analysis will therefore focus
on these new activities. Social experimentation refers to small scale projects designed to test
policy innovations (or reforms) before adopting them more widely. The impact of
the innovation on the sample population is assessed against the situation of a
‘control group’ with similar socio-economic characteristics that remains under
the dominant policy regimes[99].
The problem is establishing a credible basis of comparison between the two
groups, which can be done most efficiently by using randomization methods which
characterize social experiments. Social experimentations have been conducted in
the United States since the late 1960's to evaluate proposed changes in
programme or policy and, more recently, in Europe, Latin America, Asia and Africa. They have become an accepted part of policy evaluation in particular in the United States. The essential reason is that policymakers and many social scientists find
experimental results easier to understand – and ultimately more convincing –
than results from most other kinds of policy evaluation. Social experiments
have contributed to important advances in basic knowledge, improved understanding
of program effectiveness, and, in rarer cases, significant policy reform. There are three perspectives on the costs of a
social experiment: 1. The first compares the situation where a policy
is tested before being implemented with a situation where no ex-ante evaluation
occurs at all. An ex-post evaluation will still be possible, but if results are
negative, it will be impossible to compensate the costs unduly generated by the
programme for years, so that experimentation can be considered most effective
in this regard[100]. A social
experiment benefits society by providing better information on which to base
public policy. Of course, one cannot know before the fact whether any
particular experiment will lead to a change in policy – this depends on the experimental
findings and whether policy makers act on the findings. In deciding whether to
conduct the experiment, one must act on the expected value of the experiment,
which can be expressed as: Expected value = value of change
in policy x
probability of change in policy -
cost of experiment However, even experiments that do
not result in the adoption of any specific policy measure are used extensively
most of the time in the analysis of a number of proposed programmes and
policies in the same area[101]. More generally, if an experiment
funded by the new Programme addresses a relatively fundamental European policy
issue, its results will be still relevant to the various policy processes at EU
and Member State levels long after the experiment has been implemented. The
existence of 27 policy makers, additionally to the European decision maker,
multiplies the possible impact of a social experiment in the EU. 2. The second compares costs of a social
experiment with benefits: will the experiment be likely to generate information
sufficiently valuable to the political or institutional process to justify the
costs? This question has to be answered positively by decision makers before
the experiment can take place. 3. A somehow different perspective looks at the
experiment's opportunity cost, weighing the net benefits of the experiment
against the net benefits of alternative methods of ex-ante evaluation. Social experiments generate highly robust
information (2) and therefore more benefits to society than other methods (3). The advantages of controlled experimentation
over other methods of analysis are easy to describe. Because experimental
subjects are randomly assigned to alternative treatments, the effects of the
treatments on behaviour can be measured with high reliability. The assignment
procedure assures us of the direction of causality between treatment and
outcome: differences in average outcomes among the several treatment groups are
caused by differences in treatment. Random assignment also removes any systematic
correlation between treatment status and both observed and unobserved
participant characteristics. Estimated treatment effects are therefore free
from the selection bias that potentially taints all estimates based on non-experimental
sources of information. Another advantage of experiments is that they
permit analysts to measure and policymakers to observe the effects of new kinds
of treatment that have not previously been observed. Finally, the simplicity of experiments offers
notable advantages in making results convincing to other social scientists and
understandable to policymakers. A carefully conducted experiment permits
analysts to describe findings in extremely straightforward language:
"Relative to employers in the control group, employers eligible for
government-provided wage subsidies hired X percent more disadvantaged adults
and Y percent fewer workers who were not economically disadvantaged." This
kind of simplicity in describing results is seldom possible in non-experimental
research, where analytical findings are necessarily subject to a variety of
complicated qualifications. In recent years the last advantage of
experiments has turned out to be particularly important. Because policymakers
can easily grasp the findings and significance of a simple experiment, they
concentrate on the implications of the results for changing public policy. They
do not become entangled in a protracted and often inconclusive scientific
debate about whether the findings of a particular study are statistically valid.
Politicians are more likely to act on results they find convincing. In the absence of information from social
experiments, economists and other social scientists rely on four main
alternatives to experiments to learn about crucial behavioural parameters or
the effectiveness of particular programs: -
One source of information is
data on the relationship between economy-wide aggregates, such as
interest rates and consumption, either over time or across regions. However,
aggregate statistics are inappropriate for analyzing many kinds of
microeconomic behaviour. -
A second source is
management data collected in the administration of existing programs,
but data from an existing program seldom provide any information about what the
participants' experiences would have been if they had been enrolled in a
different program or in no program at all. -
A third source is new
survey data, which are usually more costly to obtain than programmatic data
but which provide information about the experiences of nonparticipants as well
as participants in a program, and thus offer some evidence about likely
behaviour in the absence of treatment. -
A fourth source is data
generated by special demonstration programs. Like experiments,
demonstrations involve the special provision of a treatment, collection of
information about outcomes, and analysis of treatment effects. Unlike
experiments, demonstrations do not involve random assignment. Against the potential value of an experiment
must be weight its expected costs. The costs of social experimentation fall
into three categories: -
Implementing the innovative
treatment; -
Collecting data on the
different groups; -
Analyzing the data. It is worth noting that most of these costs are
typically incurred regardless of whether a programme is evaluated through
random assignment or using non experimental methods. The major difference in
costs is that the random assignment process must be carefully implemented and
monitored, but this is usually not very costly and it is what makes most robust
results possible. The extent to which the costs of the
experimental programme represent a net cost to society depends on whether it
generates social benefits, which is difficult to assess before the programme
has been conducted. The costs of experiments can vary a lot,
depending on the sample sizes required, the method, frequency and duration of
the data collection. In the US, a typical social experiment costs $2 or 3
million[102],
although it is possible to conduct one for substantially less and some for a
lot more[103].
Fortunately, once a design has been specified, it is possible to predict the
costs of an experiment fairly accurately. With the new Programme (direct management) a budget of some
€ 20 million per year is planned for 'Your First EURES Job" and the
horizontal activities of EURES (including the management of the portal)
while all national EURES activities would be financed under the ESF through the
shared management mode. On
the basis of the results extrapolated from the survey carried out as part of
the external evaluation of EURES between 2006 and 2008, one can envisage that suggests
that around 100 000 jobseekers per year get a job or a job offer via the EURES
Job Mobility Portal. Although the evidence cannot be considered as robust, the
activities of the EURES members might lead to approximately 50000 placements
per year. It
can be argued that the transparency function and the matching possibilities
provided through the EURES Job Mobility Portal brings about better information
and better informed choices for both employers and jobseekers. Taking into
accounts these positive effects as well as the extrapolated results of EURES
Job Mobility Portal and putting them into relation with the investments done
into the Portal, the cost-effectiveness ratio can be considered as favourable.
This is also confirmed by looking at the costs per placement through tendering
done by Member States and Public Employment Service in a recently published
study under the Commission's new mutual learning programme PES-to-PËS dialogue[104] The
anticipated costs per placement under the targeted mobility scheme – for young
people filling bottleneck vacancies in other Member States – corresponds to the
price level of similar tendering processes currently carried out in the EU. If
a budget of € 10 000 000 is used for this purposes the expected outcome amounts
to approximately 5500 placements/recruitments of young people in bottleneck
occupations. For
microfinance and social enterprise support the preferred option is
particularly cost-effective, given the expected leverage of between 3 and 5
times of the EU contribution for the support to microfinance and social
enterprises. Moreover, the joint management with the EIF allows for a polling
of expertise and resources, limiting the Commission's investment in terms of
day-to-day management.
10.
Monitoring and evaluation
Following the positive experience with the results-based
management approach of the current Progress programme and in line with the
recommendations of its mid-term evaluation (see Section 3.2.1.), the EU programme
for Social Change and Innovation will remain committed to a strong focus on
results and achievements rather than resources and activities. To this end, the
programme will be monitored on an annual basis in order to both assess headway
towards the achievement of its general and specific objectives against clear
indicators (see Section 6.2.) and allow for any necessary adjustments of the
policy and funding priorities. The monitoring will also allow for assessing the
way in which gender equality and anti-discrimination issues have been addressed
across the programme's activities. Further to the recommendations of both the
mid-term evaluation and Progress key stakeholder working group, reporting
requirements, in particular those placed upon grant beneficiaries will be
reduced. This could be done by reducing the number of quantitative indicators
at the output level and measuring the progress achieved towards longer-term
goals every three years instead of annually. The
Programme will also be subject to mid-term term and ex-post evaluation. A
mid-term evaluation will aim at measuring progress made in meeting the
Programme objectives, determining whether its resources have been used
efficiently and assessing its European added value. Mid-term evaluation
report should be delivered by the end of 2017 to feed into the preparation of a
successor instrument to the Programme. The
final evaluation shall, in addition, examine the impact of the Programme. Ex post-evaluation report hall be delivered by
the end of 2022 at the latest. The
opportunity to bring together three instruments will enable the Commission to
streamline evaluation arrangements and reduce their costs. As
recommended in the external EURES evaluation a new monitoring system for
EURES and a regular customer satisfaction survey for both employers and
jobseekers will be developed and installed. The currently on-going study
'Evaluation of Public Employment Services performance measurement systems and
corresponding recommendations on geographical labour mobility indicators' will
suggest synergies with the performance measurement system of the Public
Employment Services and suitable indicators for EURES and geographic mobility.
Given the longer lifetime of the microfinance and social
enterprise support section (investments will take place until ten years
after the start of the instrument) a specific final evaluation will take place
for this section at the latest one year after the end of the mandate provided
to the European Investment Fund. ANNEX 1: Glossary
and abbreviations EES - European Employment Strategy: The European employment strategy provides a
framework (the "Open Method of Coordination") for EU countries to
share information, discuss and coordinate their employment policies. Effectiveness: The principle of effectiveness is concerned with attaining
the specific objectives set and achieving the intended results. Efficiency: The principle of
efficiency is concerned with the best relationship between resources employed
and results achieved. Geographic mobility or
"intra-EU–mobility" is used to refer to the movement of EU residents
from one country to another within the European Union. Job changers: According
to the flexicurity and labour market transition terminology, the term job
changers is used to identify a person who is currently employed but nonetheless
looking for another job. Labour mobility is about
the willingness and ability of workers to change employment or areas. Vertical
mobility changes the workers grading or status. Horizontal mobility does not.
Low labour mobility is a cause of structural unemployment. Microcredit: Micro-credit
in the EU means loans under EUR€ 25 000. It is tailored for micro-enterprises
and unemployed or inactive people who want to go into self-employment but do
not have access to traditional banking services. Microenterprise is an enterprise employing less than 10 people, including
self-employment, and whose annual turnover and/or annual balance sheet total
does not exceed EUR€ 2 million. 91% if all European enterprises are
microenterprises. OMC - Open Method of Coordination: The OMC provides a framework for cooperation
between the Member States, whose national policies can thus be directed towards
certain common objectives. Under this intergovernmental method, the Member
States are evaluated by one another (peer pressure), with the Commission's role
being limited to surveillance. The European Parliament and the Court of Justice
play virtually no part in the OMC process. The open method of coordination
takes place in areas which fall within the competence of the Member States,
such as employment, social protection, social inclusion, education, youth and
training. It is based principally on: (1) jointly identifying and
defining objectives to be achieved (adopted by the Council); (2) jointly
established measuring instruments (statistics, indicators, guidelines); and (3)
benchmarking, i.e. comparison of the Member States' performance and exchange of
best practices (monitored by the Commission). Performance monitoring: A continuous process of collecting and analyzing data to
compare how well a project, program, or policy is being implemented against
expected results. Personalised services: services provided by public employment services or other
bodies to individuals with the aim to facilitate the integration of unemployed
and other job seekers in the labour market. Private Employment Services deliver employment services to jobseekers, job changers and
employers, on commercial and non-commercial basis. Professional mobility includes job-to-job mobility, which requires a change of
employer, and occupational mobility, which is indicated by a change in job role
and functions but may occur with the same employer. Public Employment Services as public
services have a specific role in the labour market: they deliver services free
of charge to jobseekers (both unemployed and job changers) as well as to
employers, which aim to bring jobseekers and vacancies together, and also
contribute to improved transparency in the labour market. Results-based management: A
management strategy focusing on performance and achievement of outputs,
outcomes and impacts. Social enterprises produce
goods and services (often of general interest), are in many cases highly
entrepreneurial and innovative, have primarily social as opposed to
profit-making goals, produce social added-value that benefits the general
public, use surpluses mainly to achieve their social goals, and reflect their mission
in the way they operate (often with a strong element of participation and
co-decision involving those affected by the business activity). Many of these
enterprises are pioneering in developing scalable or replicable business models
that strive to make a significant impact on society, economy and the
environment. Social experimentation: the
concept refers to small scale projects designed to test policy innovations (or
reforms) before adopting them more widely. The impact of the innovation on the
sample population is assessed against the situation of a ‘control group’ with
similar socio-economic characteristics that remains under the dominant policy
regimes. Social experiments can be applied to a large spectrum of social
interventions, such as welfare-to-work programmes, provision of health
services, technologies to facilitate independent living, addressing
homelessness, education, early child development, access public utilities,
active retirement, etc. Social experimentation requires a thorough preparation and selection. The
programmes should be of sufficient size to make them politically relevant and
should focus on fields where evidence suggests that a policy change is needed.
To be conclusive, the program must be subject to well-defined evaluation standards,
to ensure that its results are transferable to another context. SPC: The Social Protection Committee is a
Treaty-based. The SPC serves as a vehicle for cooperative exchange between Member States and the European Commission in the framework of the Open Method of
Co-ordination on social inclusion, health care and long-term care as well as
pensions ("Social" OMC). In particular, the Committee plays a central
role in preparing the discussion in the Council on the annual Joint Report on Social
Protection and Social Inclusion. The Committee also prepares reports, formulates opinions or
undertakes other work within its fields of competence, at the request of either
the Council or the Commission or on its own initiative. Your first EURES job is a new
preparatory action to foster youth job mobility across the EU-27 countries. It
is aimed at helping young people and employers to fill open bottleneck
vacancies. "Your first EURES job" is one of the actions pinpointed in
the EU 2020 strategy (flagship initiative "Youth on the Move" and
corresponding Communication). [1] Study on Social
Innovation, prepared by the Social Innovation eXchange (SIX) and the Young
Foundation for the Bureau of European Policy Advisors, 2010. [2] See BEPA, 'Empowering people, driving change: Social innovation
in the European Union', 2010; OECD, 'Fostering innovation to address
social challenges', 2011. [3] Where multiple solutions exist to a socio-economic problem but have
different distributional consequences to involved stakeholders, competition
over distributional issues may result in failures to cooperate. [4] Trio Presidency Discussion Paper on Flexicurity,
May 2007. [5] Communication from the Commission to the European
Parliament, the Council, the European Economic and Social Committee and
Committee of the Regions. Improving quality and productivity at work:
Community strategy 2007-2012 on health and safety at work, COM(2007) 62
final, 2007. [6] Ibid. [7] European Agency for Safety and Health at Work. Annual
Report 2008 – Health and Safety in Hard Times, Annual Report, 2008. [8] Communication from the Commission to the European
Parliament, the Council, the European Economic and Social Committee and the
Committee of the Regions Improving quality and productivity at work:
Community strategy 2007-2012 on health and safety at work, COM (2007) 62
final, 2007. [9] European Agency for Safety and Health at Work . Outlook
1 – New and emerging risks in occupational safety and health.
Outlook, 2009. [10] European Economic and Social Committee. Opinion of
the European Economic and Social Committee on How to improve the
implementation and enforcement of EU legislation, 28 September 2005. [11] Centre for policy studies Praxis, Transition costs
of reformed pension systems. Final report, 2008. [12] Ibid. [13] Tarki Social Research Institute. Monitoring pension
developments through micro socioeconomic instruments based on individual data
sources: feasibility study. Final Report, 2009. [14] Joint Economic Policy Committee, European Commission. Report
on Health Systems, 2010 [15] Group of experts on Gender Equality, Social Inclusion,
Health, and Long Term Care (EGGSI), Access to healthcare and long-term care:
equal for women and men? Final Synthesis Report, 2009. [16] Ibid. [17] SPC Opinion "Solidarity in Health: Reducing
health inequalities in the EU" , 2010. [18] SPC Report from the SPC working group on the mutual
interaction between the common social objectives and the strategies for growth
and jobs. [19] SPC Voluntary European Quality Framework for Social
Services. SPC/2010/10/8 final, 2010. [20] European Commission - Directorate-General for
Employment, Social Affairs and Equal Opportunities – Unit E.1, Eurostat – Unit
F.4, February 2010. The Social Situation in the European Union 2009. [21] The analysis was based on the detailed desk research
of the relevant peer review documents such as the comments of Member States’
representatives in the minutes, synthesis reports, comments’ papers, to assess
whether these representatives signal clearly their intention to use or transfer
at least some elements of the practice discussed or they rather choose to
underline the institutional and other differences between the countries that
make the transfer unlikely. [22] For example, Armstrong, K.A., Governing Social
Inclusion: Europeanization through Policy Coordination, Oxford: Oxford
University Press, 2010; FEANTSA, Untapped Potential: Using the Full
Potential of the OMC to Address Poverty in Europe, Brussels, 2007. [23] ECOTEC. Study on the situation of women with
disabilities in light of the UN Convention for the Rights of Persons with
Disabilities. Final Report, 2009. [24] The Academic Network of European Disability experts
(ANED). Targeting and mainstreaming disability in the 2008-2010 National
Reform Programmes for Growth and Jobs, Report, 2009. [25] KMU Forschung Austria. Providing reasonable
accommodation for persons with disabilities in the workplace in the EU – good
practices and financing schemes. Final Report, 2008. [26] European Network of legal experts in the field of
gender equality. EU Rules on Gender Equality: How are they transposed into
national law? Report, 2009. [27] The European Commission, Improving the tools for
the social inclusion and non-discrimination of Roma in the EU, Summary and
selected projects, 2010. [28] Geographic Mobility in the European Union: Optimising
its Economic and Social Benefits, IZA Research Report No. 19, 2008 http://www.iza.org/en/webcontent/publications/reports/report_pdfs/iza_report_19.pdf [29] Case C-55/96, last sentence of the conclusions. [30] The Total Early-Stage Entrepreneurial Activity (TEA)
rate encompasses activities related to business creation, throughout all stages
of the business cycle, from conception through firm birth to the first 3.5
years of being in business. [31] Global Entrepreneurship Monitor, 2009 Global Report. [32] European Commission, Entrepreneurship in the EU and
beyond. A survey in the EU, EFTA countries, Croatia, Turkey, the US, Japan,
South Korea and China Flash, Eurobarometer 283, June 2010. [33] defined as loans of less than EUR 25 000. [34] European Commission, A European initiative for the
development of micro-credit in support of growth and employment, COM(2007)
708 final. [35] The definition of microcredit in this part of the study
is loans of less than EUR 30 000. [36] République française, Ministère de l'Economie, de
l'industrie et de l'emploi et Ministère du budget, des comptes publics, de la
fonction publique et de la réforme de l'Etat, Le Microcrédit, Rapport N°
2009-M-085-03, December 2009. The estimation is
based on a study carried out by ADIE. [37] PL, BG, LV, ES, RO, IT, F, UK, DE and NL. [38] European Parliament, Directorate-General for internal
policies, Microcredit networks and existing national legislations with a
view to the implementation of the microfinance instrument, November 2010. [39] Per-Erik Erikkson, Helmut Kraemer-Eis and Alessio
Conforti, "Microfinance in Europe", in: Delia, E.P. (ed.), Microcredit
as a Tool of Ethical Financing of Sustainable Development, Occasional
papers APS Bank, 2011. [40] OECD, The Impact of the Global Crisis on SME and
Entrepreneurship Financing and Policy Responses, 2009. [41] UEAPME, European SME Finance Survey, 2009. [42] European Commission, Gaining scale in microcredit.
Can banks make it happen?, Report on two workshops organised by the
Directorate-General for Enterprise and Industry, 2010. [43] Jayo Bárbara, González Ana and Conzett Casey, Overview
of the Microcredit Sector in the European Union, EMN Working Paper n° 6
2008-2009, June 2010. [44] Evers and Jung / EMN, EIF Market studies on micro
lending in the European Union: capacity building and policy recommendations,
March 2009. According to the study, institutional capacity encompasses vision
and strategy, funding, human resources, operational management and systems and
infrastructure. [45] Jayo Bárbara, González Ana and Conzett Casey, Overview
of the Microcredit Sector in the European Union, EMN Working Paper n° 6 2008-2009,
June 2010. [46] European Parliament, Directorate-General for internal
policies, Microcredit networks and existing national legislations with a
view to the implementation of the microfinance instrument, November 2010. [47] The results of the survey are based on 81 fully
completed questionnaires from microcredit providers in 16 EU Member States. [48] European Parliament, Directorate-General for internal
policies, Microcredit networks and existing national legislations with a
view to the implementation of the microfinance instrument, November 2010. [49] Social enterprises often serve local markets, and
therefore often have limits for organizational growth: However, successful
business models often be scaled through through replication, franchising,
networking etc. [50] For details, see Social Investment Manual. A Guide for
Social Entrepreneurs, developed by the Social Investment Task Force (Technical
University Munich; Schwab Foundation Community of Social Entrepreneurs, Schwab
Foundation for Social Entrepreneurship), 2011. [51] Investor Perspectives on Social Enterprise Financing.
Report prepared for the City of London Corporation, City Bridge Trust, and the
Big Lottery Fund by ClearlySo (author: Katie Hill , July 2011 [52] Public Policy and Management Institute , PROGRESS
stakeholder needs analysis, 2011. [53] Conference Report: Social Innovation Europe Launches
in Brussels: the Innovation Union moves forward. Available online at:
http://ec.europa.eu/enterprise/policies/innovation/files/sie-conference/conference-report_en.pdf. [54] Ex-post evaluation of the EURES programme covering the
period 2006-2008, EPEC 2010. [55] UNDP/EMES: Social Enterprise: A new model for poverty
reduction and employment generation. An Examination of the Concept and Practice
in Europe and the Commonwealth of Independent States, 2008 OECD; The Changing Boundaries of Social Enterprises
Edited by Antonella Noya, 2009. [56] Marguerite Mendell, Rocio Nogales: What are the Financial Streams?, in
: OECD , The Changing Boundaries of Social Enterprises Edited by Antonella
Noya, 2009; Social Investment Manual. A Guide for Social
Entrepreneurs, developed by the Social Investment Task Force (Technical
University Munich; Schwab Foundation Community of Social Entrepreneurs, Schwab
Foundation for Social Entrepreneurship), 2011 Investor Perspectives on Social Enterprise Financing. Report prepared
for the City of London Corporation, City Bridge Trust, and the Big Lottery Fund
by ClearlySo (author: Katie Hill , July 2011. [57] OJ L 315, 15.112006, p. 1. Decision No 1672/2006/EC of the
European Parliament and of the Council of 24 October 2006 establishing a
Community Programme for Employment and Social Solidarity — Progress. Decision
as amended by Decision No 284/2010/EU (OJ L 87, 7.4.2010, p.6). [58] Two percent of the budget is used for support measures
to the implementation of the whole programme [59] As from January 2011, anti-discrimination and gender
equality sections are managed by
Directorate-General for Justice. [60] COM 2003/8/EC of 22 December 2002 based on regulation
1612 from 1968 codified 492/2011 from 5 April 20011 [61] OJ L 87, 7.4.2010, p. 1. Decision No 283/2010/EU of
the European Parliament and of the Council of 25 March 2010 establishing a
European Progress Microfinance Facility for employment and social inclusion. [62] For more details see also: European Commission,
Implementation of the European Progress Microfinance Facility — 2010, COM(2011)
195 final. [63] The mid-term evaluation is carried out by Ecorys
Netherlands. The final report is expected to be completed in December 2011. [64] The results are presented in the annual performance
monitoring reports available at: http://ec.europa.eu/social/main.jsp?catId=659&langId=en [65] PROGRESS Annual Performance Monitoring Report 2009. [66] 89% of the 2010 Annual Survey respondents claim to
have gained better understanding of EU policy objectives by participating in
PROGRESS-funded events. See PROGRESS Annual Performance Monitoring Report 2010. [67] Over 4/5 of the respondents to the 2010 Annual Survey
agree that EU-level NGOs/networks are successful in increasing awareness and
exerting pressure on policy makers in the relevant policy area, and a source of
useful and appropriate information on the implementation of EU law and/or
conditions, needs and expectations of relevant target groups. [68] This evidence is also reported to be used for
developing national legal acts implementing EU law. Namely, 25% of the
respondents of the 2010 Annual Survey indicated that studies, analyses,
thematic assessments and monitoring reports produced under the programme have
contributed to adopting/amending national legal acts implementing EU law. [69] Interim report of PROGRESS mid-term evaluation. [70] Public Policy and Management Institute, Measuring
effectiveness and efficiency of the studies produced under Progress, 2011. [71] Ex-post evaluation of the EURES programme covering the
period 2006-2008, EPEC 2010. [72] Commission decision of 23 December 2002 implementing
Council Regulation 1612/1968 as regards the clearance of vacancies and
applications for employment, Article 2 on EURES objectives: (a) the
development of European labour markets open and accessible for all; (b) the
transnational, interregional and cross-border exchange of vacancies and job
applications; (c)
transparency and information exchange on the European labour markets, including
on living conditions and on the opportunities for acquisition of
skills; (d) the
development of methodologies and indicators for this purpose. [73] The European Social Fund include within its scope
of assistance (article 3f) "specific action to increase the participation
of migrants in employment and thereby strengthen their social integration and
to facilitate geographic and occupational mobility of workers and integration
of cross-border labour markets, including through guidance, language training
and validation of competences and acquired skills. [74] PES market share in job vacancies varies between 10
and 80% throughout EU-MS, with an estimated average of less than 40%, DTI, ÖSB,
IER. Anticipating Skill Needs for the Labour Force and Equipping People for
New Jobs, Which role for Public Employment Services in early identification of
skill needs and labour up-skilling? Final report, 2010. [75] Social Investment Manual. A Guide for Social
Entrepreneurs, developed by the Social Investment Task Force (Technical
University Munich; Schwab Foundation Community of Social Entrepreneurs, Schwab
Foundation for Social Entrepreneurship), 2011. [76] National authorities, social partners and EU-level
networks of civil society organisations. The Group met twice in January and
February 2011. [77] The results of the public consultation (a summary
report and individual responses) can be found at: http://ec.europa.eu/social/main.jsp?catId=699&langId=en&consultId=6&visib=0&furtherConsult=yes [78] Ex-post evaluation of the EURES programme covering the
period 2006-2008, EPEC 2010. [79] COM(2011)500 final. A Budget for Europe 2020 - Part II
- Policy Fiches - Communication from the Commission to the European Parliament,
the Council, the European Economic and Social Committee and the Committee of
the Regions. [80] Currently the DG EMPL is considering the practical
arrangements for opening up EURES to private employment services (PRES): Three
main option have been brought forward until now: a) cooperation with non public
employment services at EU level is limited to certain kind of programmes, like
Your First EURES Job, legal constraint (Case C-55/96, par.21)as this clearly a
placement activities b) non public employment services are fully included in
the EURES network at national and EU level on a completely equal foot as the public
employment services (this option is the least preferred); c) non public
employment services included in the EURES network, but activities at national
level are coordinated by the Public Employment Service in line with delivery of
other PES services. The legal aspects of the opening to PRES need to be further
analysed. According to regulation 1612/68 and codified 492/2011 EURES members
are designated by the Member States. This aspect needs further analysis in
connection with case ruling (Case C-55/96, par.21) where placements are
considered as an economic activity. [81] The Court specified that "…the placement of
employees is an economic activity" (Case C-55/96, par.21) and furthermore
indicated that when "the placement activities in question could extend to
the nationals or the territory of other Member States" (Case C-55/96, last
sentence of the conclusions), they cannot be done exclusively by the public
service [82] Evaluation of the Social OMC, 2011; Study
on Stakeholders’ Involvement in the Implementation of the
Social OMC, 2010. [83] To be measured as the estimated share of
budget allocated to generation of the said type of knowledge. [84] Capacity is understood here as: knowledge relevant to policy making
and advocacy; skills and ability to actively and effectively advocate them; (in
case of organisation) improved internal organisation (incl. improved strategic
planning and performance management). [85] Evers and Jung / EMN, EIF Market studies on micro
lending in the European Union: capacity building and policy recommendations,
March 2009. According to the study, institutional capacity encompasses vision
and strategy, funding, human resources, operational management and systems and
infrastructure. [86] Based on a European Parliament Preparatory Action. [87] See Interim report of PROGRESS mid-term evaluation and
annual performance monitoring reports (2007-2010). Respondents to the public
consultation, including national authorities, made also a strong case for the
continuation of the analytical and mutual learning activities which are
considered are highly relevant to the EU objectives in the employment and
social policy field. [88] ESCO stands for the European multilingual taxonomy of
Skills & Competences, qualifications and Occupations. [89] Article 149 states that the European Parliament and
the Council may "adopt incentive measures designed to encourage
cooperation between Member States and to support their action in the field of
employment through initiatives aimed at developing exchanges of information
and best practices, providing comparative analysis and advice as
well as promoting innovative approaches and evaluating experiences". Article 153 stipulates that the European Union supports and
complements the activities of the Member States to combat poverty and social
exclusion and to reform their social protection systems on the basis of policy
exchanges, mutual learning and promotion of innovative approaches. [90] In addition to the direct management funding, a share
of the budget managed by the Member States in the context of the ESF mainstream
should be ring-fenced for financing social innovation and experimentation
projects. [91] This is in line with the results of consultation
calling for better mainstreaming gender equality and anti-discrimination issues
in the new instrument. See section 1.4.3. [92] See Section 1.4.6. [93] See proposal "Your first EURES job" from the
Youth on the Move 2020 flagship initiative. [94] PES market share in job vacancies varies between 10
and 80% throughout EU-MS, with an estimated average of less than 40%, Danish
Technological Institute, PES skills study, 2010. [95] Microfinance in the Western Balkans is covered by the European Fund
for Southeast Europe and the future Western Balkans SME Platform. [96] In addition to guarantees received from the Progress Microfinance
guarantee window, two of the intermediaries, microStart and Qredits,
could also benefit from a EUR 750 000 equity investment and EUR 750 000
loan respectively for capacity building under EPPA, the funding part of
JASMINE. [97] European Microfinance Network, "Sustainability
of Microfinance in Europe", in: Microfinance in Europe, n°5 June 2009. [98] National and regional authorities consider monitoring,
research and exchange of information (through the OMC and mutual learning) as
areas where EU added value is the highest. See PPMI, PROGRESS stakeholder
needs analysis, 2011. [99] 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 Platform against Poverty and Social
Exclusion: A European Framework for social and territorial cohesion,
COM(2010) 758 final. [100] See the National Job Training Partnership Act Study:
this evaluation found that the out-of-school youth component of JTPA had
essentially no impact on the earnings of youths who participated in it. As a
direct result of this finding, funding for the out-of-school youth component of
JTPA was reduced by more than $500 million per year. In just a few years, this
saving of resources that would otherwise have been wasted on ineffective
training services easily surpassed the cost of all the social experiments that have
been conducted in the in the 30 years before 1997 [101] See for instance the US income maintenance experiments
and the Health Insurance Experiment. [102] Social Experiments: evaluating public programs with
experimental methods, Larry L. Orr, 1999, SAGE Publications Inc. [103] See the Seattle-Denver Income Maintenance Experiment
and the Health Insurance Experiment. [104] Sub-contracting in Public Employment Services, Review
of research findings and literature on recent trends and business models, by
Dan Finn, Centre for Economic and Social Inclusion, May 2011.