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European Commission

Viviane Reding

Vice-President of the European Commission, EU Commissioner for Justice

Free movement: Vice-President Reding's intervention at the Justice and Home Affairs Council

Justice and Home Affairs Council/Luxembourg

8 October 2013

In May, I have asked Ministers to provide me with factual information on free movement. 19 Ministers provided me with such information and I thank you for that. This data is the basis for my presentation today. You may also have seen media reports about a study that the Commission's Employment department has commissioned. I want to underline that this study is not the basis for my presentation today and that's why you have the Justice Commissioner here in front of you.

Free movement is the EU Treaty right which citizens value the most and see as the most important achievement of EU integration. It goes to the heart of Union citizenship. In addition, 67% think that free movement is an asset for their country's economy.

It is our common responsibility to strongly uphold this right. The four freedoms anchored in the Treaty cannot be picked and chosen. You will always see me fighting for preserving free movement, but I will also always be on your side when it comes to using existing EU tools to effectively fight against abuse.

At the end of last year, only 2,8 % EU citizens (14.1 million) were residing in another Member State. Annual cross-border mobility rate in the EU is only 0,29%. These figures are very low: in the USA, annual mobility rate of persons between the 50 States is 2,4%.

Evidence suggests that the main motivation for EU citizens to make use of free movement is work-related.

As a result of post-enlargement mobility between 2004 and 2009, GDP of EU 15 is estimated to have increased by almost 1%.

Intra-EU mobility contributes to addressing skills and job mismatches. We have to ask ourselves why some 2 million vacancies remain unfilled in the EU despite the crisis. For me, it means that we need a genuine European labour market, like in the USA. And the Commission is taking concrete actions to achieve this objective.

Free movement is a two-way street from which all Member States benefit. This was one of the reasons why you unanimously agreed to the successive EU enlargements.

Some of you asked the Commission to look into the effects of free movement on your social benefit schemes. Facts and figures that several of you provided help putting things in perspective. They show that the percentage of mobile EU citizens who receive benefits is relatively low, compared to Member States' own nationals and non-EU nationals.

I hear different debates in some of your countries on "welfare tourism" and the pressure that freedom of movement of EU citizens puts on public budgets.

Who are the mobile EU citizens? Let's look at the bigger picture: the vast majority of these persons move to work. Figures provided by Member States show that they are more likely to be of working age, more likely to be economically active and more likely to be in employment than nationals. This means that they contribute their share to national social security schemes.

When you walk through your high streets and hear people talking with a foreign accent, it is very likely that these persons are net contributors and not 'welfare tourists'. The share of those who are economically inactive is small. This gives a sense of proportion to the debate.

Every EU citizens has the right to reside in another Member State for a period up to 3 months without any conditions.

After 3 months, the right to reside is subject to certain conditions. Economically inactive persons must have sufficient resources for themselves and their family, including sickness insurance, in order not to become an unreasonable burden on the host country's social assistance system.

The existing EU legal framework provides for adequate safeguards to ensure free movement without overburdening the public finances. EU law empowers the Member States to use them.

Social assistance: under EU law, full access to social assistance is granted to workers and their families. Member States can deny social assistance to non-active EU citizens who move to another Member State during the first three months of residence. In addition, during the first five years of residence, national authorities can check whether a citizen has become an unreasonable burden. If this is the case, Member States can refuse residence and withhold the benefits.

Social security: Regulation 883/2004 requires non-active persons to first demonstrate that, in line with the strict criteria provided for in EU law, they have established their habitual place of residence in the host Member State. Only then, can they claim equal treatment with the nationals.

I am as strong in upholding the right to free movement as I am firm in fighting fraud and abuse. Abuse weakens free movement. The Commission stands by the Member States when they make use of all the safeguards provided by EU law.

Directive 2004/38/EC allows Member States to refuse, terminate or withdraw free movement rights in case of abuse and fraud.

Second, it allows restricting the free movement of citizens who represent a serious threat to public order and security.

In both cases, the restrictions may be enforced by expulsion measures, and under certain circumstances, be accompanied by re-entry bans.

Of course, Member States must respect substantial and procedural safeguards when imposing these measures.

EU rules do not harmonise neither national security nor social assistance schemes. Member States can freely decide which benefits they want to set up, under which conditions they are going to pay, how much and for how long.

The EU free movement Directive and the EU regulation on social security coordination do not impose on Member States to grant benefits unconditionally to everyone. However, national rules can be more generous. But this is the Member States' choice.

Some of you report challenging situations in some areas of their big cities. They refer to a minority of EU mobile citizens with low employment prospects which places a strain on disadvantaged areas and on local services such as schooling, health care, and adequate housing. Homelessness is reported as a growing phenomenon which, despite being small in absolute numbers, is very visible. I take these concerns very seriously.

In this context, EU funding for social inclusion is designed to assist. The European Social Fund can be used to support local authorities facing the challenge of marginalised citizens on their territory.

Free movement is our joint responsibility. The Commission, together with the Member States has already taken and proposed concrete actions to complement the exercise of this right. We will continue working in this direction.

Today I ask you for your support to implement five very concrete actions that will ensure that free movement rules strike the right balance between rights and obligations.

First, to fight abuse and fraud to free movement, the Commission is working with Member States to produce a handbook on marriages of convenience. This handbook will provide clarity to national authorities on the framework in which they can operate.

Second, the Commission has been working closely with the Member States to clarify the concept of "habitual residence" pursuant to Regulation 883/2004 on coordination of social security schemes and a guide with practical examples will be published by the end of the year. This will concretely help authorities to use the Habitual Residence Test to its full extent.

Third, the European Social Fund has been there to help national and local authorities in meeting social inclusion challenges. For the new programming period 2014-2020, the Commission has proposed an increase for this priority to 20% of the whole ESF allocation in each Member State compared to the current share of around 15%. I very much hope that Member States agree on this.

Four, the Commission has made a lot of effort to make sure that the European Social Fund is used to its full extent in all Member States and the money arrives where it is needed. It will continue to bring together Managing Authorities from the Member States to exchange best practices. .

Finally, the Commission will invite mayors in spring 2014 to discuss challenges and exchange best practices. In addition, as announced in the EU Citizenship Report 2013, the Commission will develop an on-line tool to help staff in local authorities understand and apply free movement rights of EU citizens, in cooperation with your experts.

I would be grateful for your strong and vocal support for this five point action plan, on which we have to work together to deliver. The Commission cannot do it alone.

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