European Commission’s scenarios for the future of the EU

German employers welcome this initiative in principle, since it could give fresh impetus to the urgently needed debate on the future of the EU. Yet the approach followed by the European Commission is not coherent and considerably restricts the open-ended reflection process. Presentation of the European pillar of social rights prejudges the outcome of the discussion process.
Despite its announcement that it does not want “to present any definitive decisions” in the discussion phase which is just starting, the European Commission has presented its recommendation for a European pillar of social rights with 20 key social principles and rights as well as various follow-up measures, sometimes of a legislative nature. The pillar is intended to provide new and more effective rights for citizens in order to offset the consequences of the economic and financial crisis ranging from long-term and youth unemployment through to poverty-related risks in wide swathes of Europe as well as to give an adequate response to rapid changes in society and the world of work.

With the pillar of social rights, the Commission clearly sets the course towards more European influence in social matters. Although it clearly recognises in its communication that economic and social conditions have improved since 2011, and that many of those surveyed point out in particular that under no circumstances should the pillar serve as an instrument for harmonisation of social policy in the EU. The Commission disregards these findings and also gives the impression that the cause of sometimes widening divergences in Europe can be traced back exclusively to a supposedly inadequate social policy and/or deficient social rights. However, this is not the case.

Future of social policy in the EU is restricted to greater harmonisation

With presentation of the reflection paper on the social dimension of the EU, published jointly with the pillar of social rights, the European Commission has already prejudged the discussion process. The future of social policy in the EU lies in greater harmonisation of social policy.

By contrast with the Commission’s white paper, the discussions in the reflection paper on the social dimension are limited to just three of the five scenarios proposed in the white paper. Two options, “Carrying on” and “Doing less more efficiently”, were simply not considered, even though the latter could have been an opportunity for discussing a measured withdrawal of some parts of EU social policy measures. In its third scenario with a focus on the single market, the Commission portrays a complete reversal of a large section of EU social standards, e.g. in the area of occupational safety and health, which is completely unrealistic.

As a result, of the five scenarios which were supposed to inform the discussion on the future of social policy in the EU, just two are left, both of which describe an onward march in EU social policy, either by only a few Member States or simultaneously by all Member States. This contradicts the fact that the EU is the most social region in the world.

EU already has a strong social dimension

The European Commission itself points out in its reflection paper that around 40 percent of total public expenditure (almost one fifth of GDP) is spent on social protection in the EU, even though the population of the EU constitutes only 7 percent of the world population. Europe’s national economies, unemployment is falling. Despite a geopolitical situation which is sometimes uncertain and the imminent departure of the United Kingdom from the EU, the economy in Europe is expected to grow by 1.8 percent. Employment rates are also improving. However, it is also true that the economic and social situation continues to be stretched in a number of EU Member States. This can only be remedied if economic and social progress go hand in hand.

The EU has a decisive role to play in shaping a competitive single market. The objective must be to promote the four fundamental freedoms of the single market optimally through single market regulation in order to create a business-friendly and globally competitive European economic area with a high employment intensity. Through European social regulation as a component of single market regulation, minimum standards are established which create an EU-wide level playing field in the area of social policy.

Yet the European Commission does not acknowledge that national economies in Europe can only be effective socially if their companies operate successfully in global competition and hence can lay the basis for employment and prosperity. As a result, the idea of a future for the EU which marries economic success with social balance is not taken into consideration.

Discussions around economic and social progress are being conducted separately

Following presentation of the pillar and the reflection paper on the social dimension of the EU, the Commission published a separate reflection paper on globalisation which also comprises social policy recommendations. So that as many European citizens as possible can share the positive effects of globalisation, social and workplace standards should be improved through the introduction of collective bargaining systems at global level.

The reflection paper on deepening the economic and monetary union (EMU) was also presented separately.

German employers are firmly behind the European Union and very much want to take part in a genuine and open-ended process of dialogue on the future of the social dimension. Unfortunately, however, the way the Commission has structured the reflection process is completely unsuited for this.

Information about the text

drafted by: Séverine Féraud and Martin Kumstel (BDA)

Séverine Féraud
Senior Adviser
+32 27921053