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Brussels, 9 April 2014
Proposal for an EU Platform on undeclared work
Undeclared work is a widespread phenomenon for all Member States with many types of negative consequences. Undeclared work deprives workers of social protection, puts their health and safety at risk and lowers labour standards. It also undermines fair competition for businesses and endangers the sustainability of public finances and social security systems. In the end, everybody loses.
By definition, undeclared work is hidden, which makes it difficult to measure, but we have some estimates showing that the shadow economy is about 15% to 20% of the European GDP.
A recent Eurobarometer has shown that around one in ten Europeans admits to have bought goods or services involving undeclared work. And 4 % concede to have worked themselves without declaring it.
This phenomenon continues to be widespread, even if there are differences in extent and perception from country to country. And even more since the crisis has weakened labour markets, thus encouraging the private supply of undeclared work.
The responsibility to tackle undeclared work lies in the hands of the national authorities, but Member States can only gain by working together.
This is why the Commission is proposing today a new EU Platform to bring together all the various national enforcement bodies involved in the fight against undeclared work.
This will include, in particular, labour inspectorates, social security, and tax authorities.
The involvement of stakeholders is also foreseen, such as EU level social partners, who have already confirmed that they recognise the added value of action at EU level.
The new Platform will provide a forum for experts to meet and exchange best practices, develop their knowledge of undeclared work and even engage in operational cooperation. Through this exchange, new tools both at national and EU level can be explored.
The added value of cooperation at EU level is clear when tackling cross-border situations. For this reason, the proposal envisages that all Member States will be members of the Platform.
On the operational level, the Platform can also promote future exchanges of staff, joint training exercises and inspections, as well as developing common principles and guidelines for inspectors.
Last, but not least, the Platform aims to raise awareness of this problem, for example, through EU wide campaigns and strategies.
Working together we can find better ways not only to fight undeclared work more effectively, but also to transform it into regular employment, thus boosting formal job creation.
This effort stands to have a positive impact on productivity, working standards, skills development, and will help us to progress towards the Europe 2020 employment targets.
I am convinced that this Platform can play a key role to fight this harmful form of social dumping, thus protecting decent standards for workers, fair play for business and everyone's equitable contribution to public budgets.