EurWORK European Observatory of Working Life

European Social Fund

One of four EU structural funds, the European Social Fund (ESF) is governed by Article 162 TFEU and its origins date back to the beginning of the European Community. The 1951 Treaty of Paris which established the European Coal and Steel Community (ECSC) envisaged cash aids to workers whose firms were closed or restructured in order to maintain the income of such workers at a reasonable level and assist them to retrain and find new jobs, if necessary, in different areas and thereby soften the impact of the massive restructuring of the steel industry. This is often cited as the promotion of economic social cohesion. The EC Treaty copied and extended the activities of the ECSC in this area by the creation of a social fund to compensate certain groups of people for the difficulties caused by the economic changes resulting from the creation of a common market. Between 1960 and 1973, more than 1.5 million workers were helped in this way.

The ESF began activities in its new form on 1 May 1972, increasing the types of activities funded and, instead of simply refunding Member States for their own efforts, supporting policies identified as priorities at Community level. There was a massive increase in its budget in the early 1980s: the 1983 Social Fund budget represented a 42.4% increase on 1981 and a 270% increase on 1978. In the period 2000-2006, the ESF had 70 billion EUR at its disposal, accounting for 36% of the total EU structural funds The regulations of 1999 cover the period 2000-2006 and focus on three main Objectives: 1) the development and structural adjustment of regions lagging behind, 2) the economic and social conversion of areas faced by structural problems and 3) support for the adaptation and modernisation of education, training and employment policies in regions not covered by Objective 1.

A main aim of the ESF concerns advancing the European Employment Strategy (EES). To this end, Article 2 of the ESF Regulation (1262/1999) outlines five key policy areas:

  • to develop policies to combat unemployment;
  • to promote social inclusion and equality;
  • to develop education and training;
  • to promote a skilled, highly trained and adaptable workforce;
  • to improve women’s access to the labour market.
  • In July 2006, a new ESF programme for the period 2007-2013 was adopted by the Parliament and Council. The regulations relating to the ESF focus now on two objectives: convergence and regional competitiveness and employment. The Commission contends that this new regulation differs from the 2000-2006 situation in that it is more focused, concentrating particularly on supporting the management and anticipation of economic and social change. As a means of fulfilling its two objectives, attention is paid to the following four areas.
  • increasing adaptability of workers and enterprises;
  • enhancing access to employment and participation in the labour market;
  • reinforcing social inclusion by combating discrimination and facilitating access to the labour market by disadvantaged people;
  • promoting partnerships for reform in the fields of employment and inclusion.

As in the past, these new regulations underline the importance of involving the social partners and stakeholders in the drafting, implementation, monitoring and revising ESF strategy.

As of 1 January 2007, Objective 3 (adaptation and modernisation of education) will cease to be covered by the ESF. This new legal base allows the Commission to use the ESF to be more active in the area of gender mainstreaming. Discrimination represents a major concern of the ESF. Since 2001, the ESF has financed the EQUAL programme, an initiative designed to fight employment exclusion due to discrimination based on sex, race, ethnic origin, religion, disability, age or sexual orientation.

See also: social exclusion.

Please note: the European industrial relations dictionary is updated annually. If errors are brought to our attention, we will try to correct them.
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