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European Commission

José Manuel Durão Barroso

President of the European Commission

Acting together. Learning from each other

Third annual Convention of the European Platform against Poverty and Social Exclusion/Brussels

26 November 2013

Thank you László,

Dear President of the European Council,

Distinguished guests,

Ladies and gentlemen,

It is a pleasure to be with you all today, and I want to express my thanks to everyone involved in organising this Third Annual Convention, namely László Andor, his cabinet and the services.

The conventions of the European Platform against Poverty and Social Exclusion offer something extremely valuable: the opportunity to gather all interested parties and discuss ways of working together. Especially important is the fact that here we have represented many people who are working on the issue of poverty really on the ground that can give us all the experience, the inputs of their daily experience. I believe we need that, at the European Union institutions and also at the governmental level.

I remember our meeting last year, on 5th December, in this very same building. I said to you: "We will not allow there to be a lost generation in Europe. We will not allow our inclusive and cohesive social system to crumble".

I would repeat the exact same words today. The European Social Model should not be given up. We don't want the European Social model to be dead. It is needed more than ever before. This is why we need to reform our economies in a socially inclusive way. We need to modernise our social protection systems as well.

Let me address three questions with you today:

What has happened since we met, one year ago?

What have we done?

What is ahead of us?

First of all, what has happened since we last met?

Let's take stock of the situation. Let's analyse the situation as objectively as possible, seeing what has improved and what has not improved, and some of the points where, in fact, the situation is more difficult today than some time ago.

Confronted with an unprecedented financial, economic, and social crisis, Europe has fought back. We have given a determined response and we have fought together.

This year, contrary to the previous years, we are seeing a modest, but encouraging return to growth. Various indicators are improving and getting positive. But, and I want to underline this, others are, in fact, not going the right direction, namely unemployment and poverty. And so we have to consider this, because we may be facing a recovery that is uneven, that will not touch all the sectors of our societies.

It is true that growth is gradually returning. It is true that technically we are no longer in a recession. This is a good sign, eagerly awaited in an economic context that requires confidence.

And we see that the countries that have been most vulnerable to the crisis and have done most to reform their economies are starting to note positive results, namely in terms of confidence, investor confidence and consumer confidence.

Just weeks ago, Ireland and Spain confirmed that they will exit their financial assistance programmes on time and according to plan. This shows that adjustment efforts can pay off.

However, and this is the bad news, unemployment continues at distressingly high levels. Even if recently we have seen some stabilisation of the unemployment, the reality is that today 26 million people are unemployed in Europe, including 5.6 million young people. Unemployment is clearly our most pressing problem. Unemployment, which goes hand in hand with and triggers poverty and social exclusion, is not socially acceptable.

Today, one European in four is at risk of poverty or exclusion. We cannot say the crisis is over as long as there is such high unemployment. We cannot say the crisis is over as long as 25% of Europeans are at risk of poverty or social exclusion.

We can only say that we are entering a new phase, which gives us the opportunities to better tackle poverty and unemployment – and the responsibility to do so.

Second question, what have we done?

Let me recall three major steps.

First step, the Youth Employment Package, with the Youth Guarantee and the Youth Employment Initiative. The objective of the initiative is to support young people not in education, employment or training by integrating them into the education or the labour market. As I recalled recently in Paris, at the High-Level conference on Youth Employment, it is urgent that all Members States send their Youth Guarantee implementation plans and, in these cases where the youth unemployment rate is above 25% at regional level, the plans to use the specific allocation from the Youth Employment Initiative, which will provide a top-up of 6 billion euros, probably reinforced up to 8 billion euros in 2014 and 2015.

Second step, with the Social Investment Package presented last February the Commission called on Member States to prioritise social investment and modernise their welfare states. This means better performing active inclusion strategies and a better use of social budgets, for more impact.

Last year in this forum, we noted your concern and in part thanks to your signal we put forward an ambitious package. The Commission is now engaged in its implementation.

Let me briefly highlight a few examples of European actions:

  • An enhanced monitoring system of social protection systems has been put in place, recently complemented with a new scoreboard of the key employment and social indicators;

  • The Commission is working with Member States to ensure that European Union funds support effective social investment. Specific guidance on the European funding, the European Social Fund in particular, has been developed;

  • A Regulation on European Social Entrepreneurship Funds is in force since July.

  • The recommendation enhancing measures to achieve better integration of the Roma people was provided to the Council.

  • And the European Platform for Investing in Children was also launched.

The Social Investment Package is based on existing best practices. We know that Member States with benefits and services that strengthen people's skills and capabilities have lower rates of people at risk of poverty or social exclusion, higher educational attainment, and higher employment. That makes a strong case for our commitment to social investment. So, in these areas of the social investment package, it is important to note that many of these issues are dealt with at national level. What we can do, as you have been doing, apart from the exchange of best practices, is provide guidance and put some pressure on governments to act in these fields.

But there is a third step: the Communication 'Strengthening the social dimension of the Economic and Monetary Union', which the European Commission adopted last month.

I have said repeatedly that the adjustment process in some Member States was unavoidable: the situation before the crisis was unsustainable and imbalances had to be corrected. Fiscal consolidation is a necessary precondition for our social agenda.

The recently strengthened economic governance rules aim to reinforce the Economic and Monetary Union, addressing some of the initials weaknesses of its design.

It also allows detecting and tackling in a timely way the most serious employment and social problems across the Members States.

The same objective is pursued in the Annual Growth Survey adopted just two weeks ago. Tackling unemployment and the social consequences of the crisis continues to be one of the five priorities that the European Commission proposed for Member States in the coming year.

The social dimension is not a new, nor an additional strand in our policies. The social dimension should be seen as an inherent part of Europe. It is what we have already been doing over the previous years.

This is part of our Europe 2020 agenda. As you know, we have social issues as top priority among the European Union strategy for smart, sustainable and inclusive growth. There was, and there are, some social targets there. There was, as I have told you before, a discussion at the European Council level about what could we do and what should we do at European level, since some governments were arguing in terms of subsidiarity that we should avoid social targets at European level. But finally, after the debate there was an acceptance of having some of those targets at European level, like the target to reduce poverty, namely to lift at least 20 million people out of poverty or some of the targets regarding education. But the reality is that in these targets we are not doing better. In fact, we are worse off than before, namely regarding the target on lifting people out of poverty. So we have now more poor than before the crisis. This is what I mean when I say that the recovery may be uneven.

As proposed by the Commission, last July the Council issued Country-specific recommendations specifically addressing poverty and social inclusion for 11 Member States. The Commission recognised that some Member States are accelerating efforts to tackle poverty and social exclusion, but there is more to be done to strengthen social safety nets and to enhance the adequacy and cost-effectiveness of benefits.

Ladies and gentlemen,

After an assessment of the situation and the means we have given ourselves to fix it, let's see now what is ahead of us.

Confronted with such challenges, we have to gather all our strengths, act together and learn from each other.

First, acting together. A lot of the necessary policies can only be developed and implemented at national level. But when I say national I also mean regional and local level. Indeed, we have seen, in terms of our experience, that very often the regional and local level if the most efficient level to deal with poverty because people know better the needs, they are closer to citizens in need. And in fact I believe that a lot can be done to work through networks at regional and local level.

This doesn't mean we cannot do our part of the job at the European level. We can and must complement what can is done at national and subnational level with European responsibility and European solidarity. And the European Commission has been very consistent in asking Member States to show this commitment to European solidarity.

We can do more to effectively use European funding to alleviate social distress. For the next financial period, the Commission has proposed that Member States devote at least of 20% of their European Social Fund envelopes to promoting social inclusion and combating poverty. The total budget of the European Social Fund is now, after many months of negotiation, finally fixed at 71.3 billion euro, meaning that more than 14 billion euro will be earmarked to social policies. So here we have an opportunity to deliver what is in fact an expectation of many around Europe, that we will use the Social Fund to a specific target: poverty and attaining higher levels of social inclusion.

The European Union's new Programme for Employment and Social Innovation, the European Globalisation Adjustment Fund and the Fund for European Aid to the Most Deprived are also important instruments that will help. As you know it was also not easy to get all these instruments approved by unanimity among our Member States. For instance, the Fund for European Aid to the Most Deprived that will have a minimum of 2.5 billion euros – that, on a voluntary basis of the Member States who wish, can go up to 2.5 billion euros -, is in fact important to continue the action that was initiated many years ago. And I'm happy that finally this was agreed by our Member States. And we should also not forget that the Horizon 2020 programme will also cover social innovation. So part of it can also go - even if, as you know, it's basically a programme for research - for social areas.

So we have here some instruments that if properly managed and in the good spirit of partnership between the European Commission and the Member States and you, namely those organisations that can make a difference on the ground, can produce some results.

I want to be very sincere and very frank with you: we know that these are just instruments to alleviate the problems. In fact, the correction of our imbalances, namely the need to fight poverty, will come only if we have sustainable growth. It is sustainable growth that can reduce in a sustainable way the poverty that we see in many of our societies. But before we can achieve those results – because it is clear that this will not come overnight – it is important to use specific instruments, specific funds with specific means to address the situation that I've called several times one of social emergency in many of our regions, in many of our countries. And I believe that if we do it properly, starting now with the budget approved already, in January 2014, we can at least mitigate the situation of many of our fellow citizens that find themselves in a very stressful situation.

The second issue is about learning from each other, about sharing and exchanging best practices. As you know, 11 of Europe's Member States are in the top 30 of the World Economic Forum's Global Competitiveness Index.

And what is interesting to note is that these countries, that are among the best in the world in competitiveness terms – for instance Finland, Germany, Sweden and the Netherlands - are also among those with the highest levels of social expenditure. So it shows that to have a social commitment and social investment is not incompatible – on the contrary – with competitiveness and growth. So if we get the balance right and efficiency guaranteed, the 'highly competitive social market economy' we aim at is not only possible. It is plausible and it is within reach.

It also happens that those European countries with the most effective social protection systems have the most developed social dialogue partnerships. Indeed the role of the social partners is key in the concept and implementation of our policies at EU and national level. And we in the European Commission never miss an opportunity to ask our Member States to promote this social dialogue at the national level, apart from what we have been doing, not only the Commission but in the European Council and with others at European level, namely the promotion of dialogue with the European social partners.

Acting together, learning from each other, that is why this annual convention is so relevant.

I would like to encourage each and every one of you to make the most of these two days of meetings, gatherings and even speed-dating to learn from each other. I think that we should find informal ways of consulting with organisations that are working on the ground. I'm open to consider possibilities and proposals that have been circulating. For instance, if you also want do it also with the European Parliament, you can have, in the process of shaping policies at European level, a better way of integrating the views of those that on the ground know the real needs of our society. We are open to that and I'm sure the European Parliament is also reaching out to have this kind of development.

Ladies and Gentlemen,

In 2010, when the Heads of State and Government adopted the Europe 2020 strategy, we took the commitment to lift 20 million people out of poverty. Let's be honest about this: today the situation is worse. Today, because of this crisis, there are 7 million more people in poverty. And so we have to recognise that on this matter we are not delivering. In fact we are worse off than we were before. This is why, while we keep our reforms for increasing the possibilities of sustainable growth in Europe we have to use in exceptional circumstances, exceptional instruments to address the specific issue of poverty and risk of poverty in Europe.

I believe we can do it.

We can do it inspired by our values. And the value of solidarity is at the heart of the European model. I think we have a responsibility to call for solidarity at all levels in Europe between countries, between the different citizens and different regions.

Strengthened also by experience. Experience that teaches us how far we can go when we are determined and work together.

I think with these values and this experience and encouraged by the experience of the past, we can deliver on our promises. Quoting Nelson Mandela: 'It always seems impossible, until it is done'.

So this fight against poverty is a fight, a struggle that we can win. We know the challenge is high. But we can face it. Let's rise to it. And let's rise to it together.

I thank you for your attention.

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