Because of the financial crisis, which has in the meantime reached the real economy, more and more workers are being discharged every month and they will ask themselves, what did the EU do for us and how can Europe help us..

Apart from the Lisbon Treaty, through which the social component for the first time becomes the objective of the EU, the European Parliament during this legislative period passed some bills and initiatives for a more social Europe, such as globalisation fund, the social fund, the working time directive and the directive for contract workers, the company pensions, the European Works Council, the European Social Model, flexicurity, the coordination of the systems of social security and patient mobility, directives, which could be an answer to the questions raised and which will be explained in greater detail below.

Legend

The financial crisis since 2007 is a banking and finance crisis which began in early summer of 2007 with the US real estate crisis (also called the subprime crisis). It resulted world-wide in losses and insolvencies of financing companies and has now since 2008 also infected the real economy; a credit shortage is being felt, although the states are pumping one billion after the other into the financial markets and are thus raising the public debt. US- government bonds valued at 2500 billion dollars are being pushed into the market this year alone. In Europe new government papers representing a  value of 17 % of the gross domestic product of the Euro countries will come newly onto the market  in 2009, because old loans expire and because the states need more money.

Because of the low interest even low income sectors in the USA could buy real estate, since US banks were granting credits with variable interest rates to creditors with poor credit worthiness. This increased demand led to a rise in the price of real estate and thus its value as credit security. In order to  procure the necessary capital for more and more new credits, the credit demands were securitized on a large scale valued by a rating agency and sold on to other banks by investors for a price corresponding to the ranking. The re-selling of a securitized credit had the advantage for the bank that this reduces the banking supervision's equity demands and enabled them to extend their credit volume.

The economic slow-down and the increase of the US prime rate then led to a chain reaction. Low-income debtors were no longer able to pay the increased installments for their credits with variable interest rates and had to sell their house. The increasing real estate sales reduced the value of the real estate, so that more and more banks and investors held unsecured credit demands in their portfolios, which led to massive losses because of the insolvency of the debtors. 

These losses of the investment banks and the closing of hedge funds led to a reduction in the readiness of private and institutional investors to take risks, which brought the refinancing possibilities of the banks to a standstill.  Liquidity fluctuations and a lack of trust between the banks are the cause that the financial crisis is affecting the real economy more and more, since the companies can no longer obtain the necessary re-financing credits for their production and the credit market is increasingly kept closed for consumers because of the high demands on creditworthiness, which made the EU Commission predict a negative growth of 1.8% for the Community. The discharges are still within limits so far because of the low demand in the consumer and investment field because of the reduction of working time accounts and shorter working hours. But the number of unemployed is on the increase every month, and the citizen rightly asks what did Europe do to safeguard my job and how can Europe help me.

In view of the extent and the fast development of the present crisis the parliament checked its instruments for an effective employment policy and adapted them to the new situation.

We are therefore presenting only some new legislative initiatives below, which the parliament passed during the legislative period and which might                                         be able to provide an answer to the questions raised.

1. Globalisation Fund (Report Stauner )

In December 2006 the EGF was set up in order to manifest its solidarity vis-a-vis the workers who were discharged because of extensive structural changes in the world trading system as a consequence of the globalisation. The maximum annual funds available amount to Euro 500 million, which are being used to support active labour market policy measures, for example as aid  when looking for work or in the form of further training and mobility grants. e.

The EPP managed to structure this instrument in a useful manner also for the present crisis by insisting that the range of application of the fund is reduced from 1000 discharges to 500 discharges in a company and extended to its suppliers which are affected by the globalisation or the world economic crisis, by making the co-financing more attractive for the member states and by improving the efficiency of measures for re-integration, by attaching more importance to the qualification of workers for jobs with a future.  

2. Social Fund ( report Silva Peneda )

The aim of the European Social Fund set up according to Article 146 EC Treaty is to promote the professional usability and the local and professional mobility of the workers. The EPP rapporteur managed to focus the measures of the Social Fund on the following key areas: 

• Improvement of the adaptability of workers and companies
• Improvement of the access to employment, reduction of unemployment and extension of the working life
• Promotion of social integration through integration of disadvantaged persons in gainful employment
• Promotion of partnerships with a view to reforms in the fields of employment and integration in the labour market
• Promotion of investments in the human capital through improvement of general and vocational education.

In order to increase the reaction capacity of the fund, the parliament simplified the method for the use of the funds by now allowing the financing of the fund on the basis of flat rates in order to facilitate access to the subsidies and to account for the projects more quickly instead of having to document every single expenditure..

3. Working time directive (report Cercas)

At the same time the European Parliament changed the existing working time directive in order to achieve more flexibility and security for the working time. Two new definitions were introduced, namely stand-by duty and inactive time. The term stand-by duty covers situations where the worker is obliged to be present at the place of work, whilst during inactive time one is ready to work, but one is not at one's place of work. The EPP made sure that active and inactive stand-by service counts as working time, but that inactive time is weighted differently than working time, but not as free time. It also was against exceeding the maximum working time of 48 hours without compensation (opt out). In this way on can react flexibly to fluctuations in demand, if an adequate compensation is given for the extra work within 12 months and if the worker has agreed to this extra work. The Council however sticks to the non-application clause (opt out); it distinguishes between active and inactive times during stand-by duty, and  only the former is reckoned as working time and the weekly working time can be extended up to 60 or 65 hours during an average period of three months if the inactive time is considered as working time. 

The parliament rejects this approach, would like to cancel the non-application clause completely after a transition period of 36 months and proposes the introduction of additional safeguards for the workers, such as the reduction of the duration of the approval of a worker to work more than 48 hours  from 12 to 6 months, the nullity of such an approval given during probation time, no limitation to a 60 or 65 hour week, consideration of the directive for workers who work less than 10 weeks per year.

The parliament also wants to protect workers with more work contracts by making it clear that the total amount of the working time performed for each individual contract must be considered as the working time of the worker..

4. Working conditions of contract workers (temporary work) (report  Desir)

In order to react more flexibly to fluctuations with the orders of the companies more and more temporary workers are employed whose remuneration differs essentially from the remuneration system of a full-time employee. To prevent this, the EPP made sure that for workers with a temporary contract, during the term of their lease to a leasing company for more than 6 weeks, at least the same working and employment conditions apply as if they had been employed by this company directly for the same job.  One can depart from this regarding the remuneration, if the contract worker has concluded an unlimited contract with the contract work company and is also paid for  he time between the leases.

5. Company pensions (report Oomen )

Additional pension schemes through company pensions are becoming more and more important, but they reduce the freedom of changing one's place of work if the claims acquired lapse through such a change. In order to ensure that additional pension schemes do not hinder the mobility of the workers and so that workers have the possibility of starting an additional  pension scheme as early as possible, the group made sure that non-lapsable entitlements are to be granted by not later than at an age of 25 years, that a just adaptation of the dormant claims to the economic development is to be ensured, that the obligations of the old age pension systems in favour of the future pension beneficiaries are laid down exactly, and, so as not to burden the companies too much, that a transferability of the pension claims to other systems at the present point in time need not be guaranteed when the worker leaves.

6. European Works Council ( report Bushill Matthews )

Fourteen years after the directive about the setting-up of a European Works Council was passed there are about 820 European Works Councils which inform and hear 14.5 millions workers across national borders. Since it was found however that the rights on cross-national information and hearing are not effective enough and that there is legal uncertainty with regard to the relationship between the national and cross-national scope of the hearing as well as in the case of mergers and acquisitions, the EPP group specified the principles for cross-border information and hearing, set out the competency of the European Works Council, and cleared the obligation of the employer for making information available. It was however not possible to achieve a suspensive effect for the measures intended by the employer side nor could the size of the company be reduced which determines when a European Works Council has to be set up.

6. European Social Model (report Silva Peneda )

Since the markets are under an increasing global competitive pressure the differences in income are growing, more and more citizens of the Union get  into a precarious social position, are being pushed out of their learned  trades by the technological change and are forced to accept uncertain working conditions. This development is not only a burden on the social systems, but also on the European economy as a whole.

The model of the Social Market Economy represents an economic order which is based on the principles of a free market economy, but whose negative effects for those acting on this market are to be avoided through regulatory measures of the state. It has become accepted today in different forms as the essential economic model in Europe. It is based on the principle of the freedom of the market, where supply and demand meet and the price for the goods is established. The economic policy of the state is to provide the regulation framework to guarantee a functioning market with sufficient competition. The principle of social balance also applies. The state is to protect the individual in case of involuntary unemployment or illness, for example through the introduction of a system of social insurance. This order model therefore has the task of integrating the economic forces of the free market into a body of rules and regulations which not only prevents abuse, but also guarantees the provision of the basic social needs and social security, which combines freedom and civil equality before the law with social justice, solidarity and balance. It is therefore quite different form the liberal, constitutional market-economy model, the Anglo-American model of the "welfare market", by supporting the obligation and legitimation of the state to intervene in social conditions, as well as from the social-democratic governmental model of society of the  "welfare government", by guaranteeing the legal protection of private ownership of means of production and the independence in principle of the company and not insisting on a government wage policy and an egalitarian basic security for all on as high a level as possible, financed through taxes. What we refer to as the European Social Model goes back to the totality of the social models in Europe, which are all based on the system of social market economy. The core elements which therefore positively distinguish the European Social Model from other economic models are the following :

The overall social responsibility for the welfare of all citizens (faire distribution of income; sufficient employment possibilities in competitive companies; social protection against risks such as illness, invalidity, unemployment, old age; support of families; opportunities of education for all; protection against poverty; high-quality and affordable services of general interest). 

Economic dynamics and social progress are not considered as contrasts but as mutually supportive. Competitiveness is combined with social justice.  

Conflicts of interests between employers and employees are settled in institutionalized forms of social dialogue (collective agreements, industrial co-determination); the associations of the employers and employees are involved in the forming of the political will by the governments. Economic success and protection of the environment and the climate are considered as objectives to be reached together, because sustainable economic success requires an intact environment.

With due regard to the principle of subsidiarity government institutions can only intervene when the individual economic subject cannot manage alone any longer. To preserve this model and to adapt it to the requirements of today the parliament specified the demands on the European Social Model, and our group ensured that economic progress is coupled with social progress and that the citizens are given the possibility and the capacity for fully exhausting their potential whilst at the same time helping those who cannot help themselves.

7. Flexicurity (reports Cristensen, Protasiewicz )

In this context one also has to see the answers of the parliament to the flexicurity approach. New forms of flexibility and security are needed to achieve more and better jobs. What is required more and more in view of the international division of work is security of employment for the worker and not so much security of the working place, since fewer and fewer people can remain in one and the same place of work during their entire life. The  flexicurity approach is meant to ensure that EU citizens are offered a high degree of employment security. The group managed to make its point that there cannot be on single model of flexicurity and that the models depend on the efficiency of the member states, on their traditions and the               financability of their social security systems. Therefore

• the systems of modern security must be modernized so that they offer an adequate safeguarding of income, promote employment and facilitate labour market mobility
• comprehensive strategies of lifelong learning must be developed which can guarantee the constant adaptability and employability of the workers
• effective active labour market policy measures must be financed which help the people to master the rapid changes, to shorten the times of unemployment and to facilitate the transition to new gainful employment
• the existing labour laws must be modernized and the organisation of work must be reformed.

In order to drive the development of an innovative and sustainable European Social Model the parliament made available Euro 658 million within the framework of the community programme Progress 2007-2013, in order to improve employment, social protection and the working conditions through projects in the member states and to support the fight against discrimination and gender disadvantaging.

8. Coordination of the systems of social security (reports Lambert, Cremers )

In order to guarantee the free movement of persons the parliament codified, simplified and modified the existing ordinance 1408/71 on the application of the systems of social security to workers and self-employed and their dependents who immigrate or emigrate within the Community by the new ordinance 883, so that the persons concerned will be treated equally according to the different national legal provisions.

The circle of entitled persons was widened to include stateless persons and refugees and their dependents and survivors. The accumulation of claims of different applicable national legal provisions was prevented: Dependents of cross-border commuters can now receive medical treatment in the country in which the commuter works 

• looking for work in the member states is made easier
• early retirement regulations are included in the scope of this ordinance

This ordinance applies to:

• sickness benefit
• maternity benefit and paternity benefit on a par
• invalidity benefit
• old-age benefit
• surviving dependents benefit
• benefit for work accidents and professional households
• death benefit
• unemployment benefit
• early retirement benefit
• family benefit

9. Patient mobility (report Braghetto-Bowis )

The directive on cross-border health care is of great importance for the European citizen. So far it was often very difficult for patients and members of the health professions to know which rights exist for a reimbursement for cross-border health care and whether it is at all possible to seek health care in another country. The objective of this initiative of the European Parliament is to create a clear framework for cross-border health care in the EU in order to make it possible to exercise the patients' rights and having a high level of health at the same time, by

• ensuring that the right to reimbursement for health care provided in other member states is made sufficiently clear
• guaranteeing that the necessary conditions for high-quality, safe and efficient health care exist also for cross-border health care
• ensuring that cross-border health care is in line with ensuring nationwide care, quality and safety
• guaranteeing that the competency for health services lies primarily with the member states and that the cross-border health care will not lead to less quality for the locals
• ensuring that the questions of compensation for any damages caused by the health care are regulated
• guaranteeing that the reimbursement of costs for health care in other member states is regulated in such a way that the patients are entitled to reimbursement of the amount of the costs which would be reimbursed in their country for the respective treatment
• ensuring that the continuity of care between the different members of the health professions and institutions is guaranteed
• guaranteeing that the citizens have clear information about health care so that they can make a well-founded decision.