A Social Imbalances Procedure (SImP) for the EU Conference ‘Integrating the European Pillar of Social Rights into the roadmap for deepening Europe’s Economic and Monetary Union’ Brussels, 04 July 2019 Sebastiano Sabato, European Social Observatory (OSE) www.ose.be

Structure of the presentation Why a Social Imbalances procedure (SImP)? The design of the SImP Summing – up: the main features of the SImP Some questions for the debate www.ose.be

Why a Social Imbalances procedure (SImP)? (1) Structural asymmetry between social and economic dimension in the EU Binding procedures in the economic and fiscal domains: Macro-economic imbalances procedure and Excessive deficit procedure First part of the crisis: subordination of social objectives to macro-economic and fiscal priorities: fiscal consolidation as a top priority often at the expenses of social rights Since 2014, ‘socialization’ of the European Semester + EPSR www.ose.be

Why a Social Imbalances procedure (SImP)? (2) Is this sufficient? To rebalance the economic and social dimensions of the EU To ‘shelter’ social policies from a possible new crisis? To ensure an adequate implementation of the EPSR in countries with severe social situations and limited budgetary resources? Need to reinforce the governance of EU social policies through a Social Imbalances procedure www.ose.be

The design of the SImP (1) A definition of excessive social imbalances “Social problems that, given their social, economic, and political implications, threaten social cohesion within a Member State” www.ose.be

The design of the SImP (2) Consequences of excessive social imbalances at the EU level Some of these imbalances (e.g. youth unemployment and child poverty) can have negative economic spill-over effects in the Eurozone (Vandenbroucke et al. 2013) Risks for the political stability of the EU www.ose.be

The design of the SImP (3) Governance arrangments 3 steps: Identifying and understanding social imbalances Defining interventions Monitoring system www.ose.be

The design of the SImP (4) Identifying and understanding social imbalances 1. Identification of the countries potentially concerned by the SImP ‘Critical situations’ in the policy areas covered by the SImP identified in the Joint Employment Report on the basis of the Social Scoreboard 2. Understanding the causes of social imbalances Semester’s Country reports + a more in-depth analysis www.ose.be

The design of the SImP (5) Defining interventions Multi-annual national Action Plan (MAP) a list of initiatives/reforms to be implemented by the MS in the years to come (at least a three-year time span); EU actions to support the implementation of these initiatives an assessment of the coherence between the social objectives/initiatives in the MAP and macro-economic and fiscal policies/objectives www.ose.be

The design of the SImP (7) 3 types of EU intervention: Technical assistance (e.g. through the the Structural Reform Support Service) Targeted financial support (e.g. Reform Delivery Tool; the re-focusing of Member States’ Operational Programmes or an increase in the EU co-financing rate for the ESI funds) “Silver rule”: exempting expenditure in human capital intervention from the Stability and Growth Pact rules www.ose.be

The design of the SImP (8) EU support Focus on social investment- related measures and social infrastructure EU support conditional on Respect of EU guidelines in designing social policies Respect of the fiscal rules defined in the SGP www.ose.be

The design of the SImP (9) Monitoring system Through the documents of the European Semester (including the Stability or Convergence programmes) www.ose.be

Summing – up: the main features of the SImP (1) The SImP would be: Based on a system of incentives and conditionalities Based on a balance between EU steering and MS’ autonomy in defining social policies (voluntary and collaborative process) Characterised by a precise delimitation of the nature of EU support (social investment and social infrastructure) Based on policy coherence (between social, macro-economic and fiscal objectives) A legally binding procedure www.ose.be

Some questions for the debate (1) Would the SImP be desirable/useful? Suitable to effectively address social imbalances? Other, more effective, ways? www.ose.be

Some questions for the debate (2) Would the SImP be feasible? From a legal viewpoint (new regulations/ changes of the Treaty?) From a technical viewpoint (e.g., new indicators in the Social Scoreboard?) From a political viewpoint (is there a potential political coalition supporting this idea?) www.ose.be

Thank you for your attention! www.ose.be