Communiqué, issue 3, 2003
Articles
- Making Europe a better place to live and work
- An efficient and effective European social model
- Flexibility perceived differently across the EU
- The voice of young people
- Rethinking priorities?
- The social model in a future Europe
- Opening the door to a civil society
The following quotes are taken from speeches and discussions which took place during the Foundation Forum. To hear the full version of the speeches, go to: www.eurofound.europa.eu/about/forum_material.htm.
'The European Union is outstripping the much vaunted productivity gains of the US economy due to interdependence and the linking of public and private institutions. I'd argue the key to good productivity is high-performance organisations and Europe has plenty of these.'
Will Hutton, Executive Director, The Work Foundation
'Europe created 8 million jobs in the last ten years. The US created 23 million jobs in the same period.'
Peter Sutherland, Chair, Goldman Sachs international and British Petroleum
'Europe is not an island: we have to strike the right balance between social protection and a flexible labour market. All regulation has a cost.'
John Bruton, former Prime Minister of Ireland
'Will enlargement be a threat to the core of the social model?'
Raymond-Pierre Bodin, Director, European Foundation for the Improvement of Living and Working Conditions
'The European social model is an asset. It has served us well in the past and should do so in the future.
Emilio Gabaglio, Secretary-General, ETUC
'Social policy is not against modern capitalism: it is part of modern capitalism.'
João Cravinho, President, CEEP
'You don't create employment through legislation.'
Thérèse de Liedekerke, Director of social affairs, UNICE
Making Europe a better place to live and work
Irish Prime Minister Bertie Ahern TD, European Employment and Social Affairs Commissioner Anna Diamantopoulou, and Foundation Director Raymond-Pierre Bodin at the opening of the Foundation Forum
The first Foundation Forum brought together some 200 participants, among them fourteen Ministers of Labour and Social Affairs, from the 28 EU Member States and candidate countries.
The major two-day event held on 29 and 30 August 2002 was kicked off by speeches by Irish Prime Minister Bertie Ahern, European Employment and Social Affairs Commissioner Anna Diamantopoulou, and Foundation Director Raymond-Pierre Bodin.
Mr Ahern emphasised that flexibility was 'absolutely essential' to the development of a European social model. He asserted that effectiveness and pragmatism should be key considerations when developing social policies.
(listen to the speech: MP3 sound file)
Mrs Diamantopoulou pointed to the huge differences still existing between Europe and the US: 'It is a choice between a more, or less, uneven distribution of income, opportunities and life chances.'
(listen to the speech: MP3 sound file)
Mr Bodin highlighted the importance of having a common understanding of how to value the way we live and the way we work as the basis for the creation of a common European social model.
(listen to the speech: MP3 sound file)
Some 200 participants, representing all segments of society including governments, trade union and employer organisations and NGOs, and a small group representative of 'the voice of youth', from all 28 EU Member States and candidate countries gathered in Dublin for the Foundation Forum 2002.
Social policy still subordinate to monetary policy
Flexible labour markets, an active society for all, social rights and social standards, and EU governance are four policy areas which challenge the European social model.
During the Forum, discussions among participants were concentrated around these four challenges. Also identified was the need for social indicators that are as stringent as those used to define financial measurements.
'The supremacy of the economy still seems to reign,' was the conclusion of Marie-Hélène Gillig, MEP and Vice-Chair of the European Parliament Employment Committee, summing up the features and challenges of the European social model. 'Social policies are still considered to be subordinate to economic policies.'
(listen to the speech: MP3 sound file)
But Will Hutton, Executive Director of the UK Work Foundation, argued that even if the starting point is an economic one, Europe is in a good position to develop the social model since the EU economy is currently outstripping the much vaunted productivity gains of the US economy. Mr Hutton claimed the reason for this was the interlinking of many public and private institutions in Europe, in contrast to the American notion of independence in terms of individualism, unilateralism, and privacy. 'The European social model is superior to the American one,' declared Will Hutton during the course of his captivating address.
(listen to the speech: MP3 sound file)
Peter Sutherland, Chairman of Goldman Sachs International and former EU-Commissioner, argued that although there is no single European social model, countries in Europe - Denmark, Sweden and the Netherlands in particular - have benefited economically and socially from the introduction of a EU-wide competition policy. 'Competition policy is absolutely crucial to European efficiency,' proclaimed Peter Sutherland with fervour. 'The distribution of wealth in the well-functioning economies of Denmark, Sweden and the Netherlands - in comparison to what it seems to me to be the less successful models in Germany, France and Italy - works since they all embrace liberalisation and have introduced elements of flexibility in their workforces.'
(listen to the speech: MP3 sound file)
An efficient and effective European social model
The social partners and governments share the view that the European social model must stimulate economic and social progress through high levels of employment. It is patently clear that people will judge the success of a European social model on the capacity to deliver.
The debate around the European social model did not start from scratch, argued Thésèse de Liedekerke, Social Affairs Director of UNICE, during her address to the Forum. According to de Liedekerke, there are some 230 legally binding texts at EU-level, and these are implemented at national level, forming a web of national protection systems, which is in fact the European social model.
Emilio Gabaglio, ETUC
While the current set of models have produced some 10 million additional jobs in the last 10 years, de Liedekerke conceded that reform has been slow. In her view, the almost 8% unemployed across Europe, coupled with unacceptably low employment rates and the large numbers of the population living at poverty level, are all indications that reform is badly needed. The bottom line, asserted de Liedekerke, is that the growth of social protection expenditure during the 1990s was lower than the growth in GDP, creating more favourable conditions to invest in the social well-being of people.
Socio-economic balance
João Cravinho, CEEP President, echoed the private employers' call for a reform linking economic and social performances. While Cravinho favoured the inclusion of universally affordable and high-quality social services as an important component in social policy, he also argued for the establishment of indicators that not only take into consideration the cost side but also benefits, in order to create an overall balance between social policy and competitiveness.
Recognising the role of the social partners
Representing the government point of view, Tiziano Treu, Italian Senator and former Minister of Labour, affirmed the important role of the social partners in consensus building, which is a prerequisite for social policy reform.
Emilio Gabaglio, ETUC Secretary general, agreed with this viewpoint, declaring that 'the European social model must be reformed via a process of consensus-building'. His recipe for success was to use social dialogue and social consultation, since in his opinion 'social dialogue is as vital for the advancement of Europe as the EU institutions are vital in the direction of the European model.' 'The governments believe', added Mr Gabaglio, 'that they can dictate social dialogue and social consultation - at the expense of the workers - while it's a common fact that you cannot change if the people concerned are not involved.'
Flexibility perceived differently across the EU
The notion of flexible labour markets is perceived differently across the EU due to differing social security systems in each Member State. While flexibility can result in less security for workers, it can also lead to benefits such as more family-friendly work practices.
Des Geraghty, Irish trade union SIPTU President, argued that workers often regarded flexibility as a 'dirty word', associated with long hours, poor conditions, and abuse of labour. 'We must continue to treat the idea of absolute flexibility with caution, and rightly so,' said Mr Geraghty during the debate on flexible labour markets. This was 'simplistic', retorted Susan Anderson, the Confederation of British Industry's Human Resources Policy Director. On the 'flexibility versus security' issue, she believed that flexibility can lead to long-term security, citing, as an example, workers' skills as the basis of their employability. She argued that many employees choose to work part-time or opt for teleworking because it contributes to a better work-life balance. She felt that security within jobs was often achieved at the expense of outsiders. On the role of the EU, she observed that 'one size doesn't fit all': in the UK, skills flexibility is an issue given the 20 per cent of the population who are functionally illiterate, whereas in Italy, for example, geographical flexibility might be the most pressing deficit.
Differing social systems can create inflexible labour
The inflexibility of labour markets between EU Member States, resulting from the inability to reconcile the different social security systems, was an obstacle to the free movement of labour. For instance, workers from Member States like Germany and France, which have higher taxes but more comprehensive social security systems, are reluctant to work in countries like Ireland or the UK, which have lower taxes but less adequate social protection.
Ms Gradin calls for recognition of the experience of old workers
Anita Gradin, Ambassador of Sweden and former EU Commissioner, declared: 'We need a flexible labour market but it must be combined with security and it must be employee-friendly, family-friendly, health-friendly and diversity-friendly.' Ms Gradin also called for a more flexible labour market exit and for the recognition of the skills and experience of older workers.
The voice of young people
Europe must involve the 'new' Europeans, young men and women, and the responsibility for this must lie with the decision-makers forming the future Europe, not with the young.
There is a distinct difference between involved and uninvolved young people, between those who want to contribute to the improvement of society and those who simply want to benefit from it. This was one conclusion from a parallel session with students sharing their vision of tomorrow's Europe during the Foundation Forum. Some 100 high school students from local Dublin schools and university students from around Europe participated at the event under the guidance of Professor Theodore Zeldin of Oxford University.
Involving the young
Professor Zeldin argued that involvement is the key to curbing the growing disenchantment of youngsters with the political system. According to Zeldin, the responsibility for this effort lies with the decision-makers forming the future Europe, not with the young.
'Europe must involve the new Europeans, who are educated and know what they want,' Mr Zeldin said and then went on to argue that the challenge for the future is to offer equal opportunities for men and women. 'To have the female section of the population integrated into today's Europe is the most important revolution that has happened, much bigger than the Russian Revolution, the fall of the Berlin wall, and even the founding of the EU.'
Rethinking priorities?
EU policy makers were urged to consider the needs of young children during the Foundation Forum.
'A good pension strategy begins with babies,' said Professor Gøsta Esping-Andersen of the Universitat Pompeu Fabra in Spain during a keynote speech on features and challenges of the European social model. Professor Esping-Andersen made the point that policy-makers should concentrate on the needs of the young rather than the old during his address on the need for a new welfare state in Europe. 'Increasingly fragile family structures and intensifying inequalities represent two important changes in society,' said Mr. Esping-Andersen. 'As a result, research estimates that 15-25% of young people have low inherent abilities and will have difficulties in a future labour market, given the arising needs of inherent abilities.'
Professor Esping-Andersen
Lack of social skills at the root of the problem
Professor Esping-Andersen claimed that lack of social skills is directly related to the poor academic performance of economically disadvantaged children. He went on to say that government policy should concentrate on supporting young families, with good 'pedagogic' childcare and spending on education to offset the effects of an ageing population in Europe. 'We have to rethink priorities and focus on early childhood, and probably the most important is that social inheritance in poorer families has to cease. If we don't do this, we will continue to have 20-30% of youth with inadequate human capital to face the future
Falling birth rates
He also pointed out that birth rates were falling throughout Europe and particularly in the countries of southern Europe, despite claims from Europeans in opinion polls that they wanted their families to have on average 2.3 children.
(listen to the speech: MP3 sound file)
The social model in a future Europe
Striking the right balance between the need to create a welfare system that looks after the people of Europe and the ability to pay for it is the main issue for the future of the European social model.
'The best form of social protection is paid employment,' argued Malcolm Wicks, UK Parliamentary Under Secretary in the Department for Work and Pensions. In order to pay for the social system it is necessary, according to Wicks, to get as near to full employment as possible. He also felt that employment should be the number one priority in European social policy. 'Make work possible, make work pay, make work skilled and make work family-friendly,' was his prescription for European policy-makers.
(listen to the speech: MP3 sound file)
Friedrich Buttler, ILO Regional Director, observed that 'global market governance has grown quicker than global social governance': the question was, to what extent is this lag tolerable. Economic prosperity does not automatically bring social harmony and the objective for Europe should be to avoid economist John Kenneth Galbraith's characterisation of US society: 'Private affluence, public squalor.'
Bernhard Jansen, European Commission Director of Employment and Social Affairs, advocated a good social policy and an 'open method of co-ordination' that allows member states to compare their performance with others. He also reminded the audience that the Nice Council said there was an indissoluble link between economic performance and social progress.
Theo Bouwman, MEP and chair of the European Parliament's employment committee, pointed out that employment, social and environment guidelines must be integrated when considering social policy.
Giampiero Alhadeff, President of the Platform of European Social NGOs, declared that while there had been many successes, he was interested in strengthening the social dialogue aspect of decision-making still further.
Opening the door to the civil society
Reform of governance is a political issue and ultimately must be decided by politicians. But it is also an issue in which the social partners have a significant role to play.
Transparency and legitimacy are two current public policy preoccupations. Both are furthered by the notion of empowering the citizen in the political process. This can be encouraged through education, on the one hand, and greater reforming governance on the other. During the Forum discussion on 'EU governance and the European social model', the potential of civil society organisations for integration in existing decision-making structures was explored and challenged. 'Social dialogue is one area of growing importance in the EU decision-making system but is still under-utilised,' argued Jérôme Vignon of the European Commission. 'It fails to live up to its potential for a variety of reasons, amongst them the failure of social partner groupings to coordinate effectively at EU level, as opposed to national level.'
Support of all social actors
Jan Olsson, President of the employment and social affairs section of the European Economic and Social Committee (ECOSOC), made the case for the broadest possible participation in policy-making. 'Support of all social actors, and not just 'the usual suspects', is essential to the formulation of social policy,' said Mr Olsson. 'Voluntary social service providers as well as the full range of social NGOs need to be involved.' Olsson also asserted that the Community's open method of coordination - the European employment strategy and associated national employment action plans - tends to be too top-down in approach. It is in effect, he said, an instrument involving only the EU and the Member State governments with little or no participation from all the other social actors.
The importance of representativeness
Bartho Pronk MEP, pointed to the differences between social dialogue and civil dialogue, and to the discussion in the European Parliament on the issue of the representativeness of social partner groups. Pronk argued in favour of integrating other civil society organisations in the structures of the main trade union and employer groupings, in accordance with clear criteria. Theo Bouwman MEP, intervening from the floor, commented that decisions should be taken at the lowest possible level, following the principle of subsidiary. In Bouwman's opinion, many of the policy areas in which the EU is active should be decided at national level. Some speakers, however, were quick to warn against opening the consultation net too wide. They claimed that certain civil society organisations were merely single-issue interest groups with limited claims to represent any specific constituency and that having a mosaic of opinions did not necessarily promote the cause of participative democracy.
Avoiding short-term gains
The sole American on the panel, Professor Nicholas Ashford of the Massachusetts Institute of Technology, outlined some of the socio-economic divergences between the EU and the US. He issued a warning to European policymakers to avoid replicating the symptoms of what he called the 'US disease': the over-emphasis on short-term and static economic efficiencies at the expense of long-term, dynamic efficiencies. 'Don't catch the American disease,' was his parting injunction to delegates.
COMMUNIQUÉ
Communiqué is published by the European Foundation for the Improvement of Living and Working Conditions, Wyattville Road, Loughlinstown, Dublin 18, Ireland.
The Foundation is an autonomous body of the European Union, established by Regulation (EEC) 1365/75 of the EU Council of Ministers of 26 May 1975.
Director: Raymond-Pierre Bodin
Deputy Director: Eric Verborgh
Communiqué is published 6 times a year, in English and French. Any item may be reproduced without further permission if the source is acknowledged.
Communiqué is available free of charge. It is also available for free download at www.eurofound.europa.eu/newsroom.
Editor-in-chief: Elisabeth Lagerlöf
Editor: Måns Mårtensson, e-mail: mans.martensson@eurofound.europa.eu
Original language: English
Circulation: 15,500
EF/02/101/EN
FURTHER INFORMATION
General information, enquiry services Tel: +353-1-204 3100, e-mail: information@eurofound.europa.eu
Måns Mårtensson, Press Officer Tel: +353-1-204 3124, e-mail: mma@eurofound.europa.eu
Information Liaison Officers: Camilla Galli da Bino, EIRO Tel: +353-1-204 3125, e-mail: gdb@eurofound.europa.eu
John Hurley, Working Conditions Tel: +353-1-204 3209, e-mail: joh@eurofound.europa.eu
Marina Patriarka, Industrial Relations Tel: +353-1-204 3115, e-mail: mpa@eurofound.europa.eu
Teresa Renehan, Living Conditions Tel: +353-1-204 3126, e-mail: ter@eurofound.europa.eu
Gregorio De Castro, EMCC Tel: +353-1-204 3229, e-mail: gcf@eurofound.europa.eu