DRAFT REPORT. EN United in diversity EN. European Parliament 0000/0000(BUD)

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1 European Parliament Committee on Budgets 0000/0000(BUD) DRAFT REPORT on the proposal for a decision of the European Parliament and of the Council on the mobilisation of the European Globalisation Adjustment Fund (application from the Netherlands EGF//2016/005 NL/Drenthe Overijssel Retail ) (COM(2016)0742 C8-0000/ /0000(BUD)) Committee on Budgets Rapporteur: Nedzhmi Ali PR\ docx PE v01-00 United in diversity

2 PR_BUD_Funds CONTTS Page MOTION FOR A EUROPEAN PARLIAMT RESOLUTION... 3 ANNEX: DECISION OF THE EUROPEAN PARLIAMT AND OF THE COUNCIL... 7 EXPLANATORY STATEMT... 9 PE v /11 PR\ docx

3 MOTION FOR A EUROPEAN PARLIAMT RESOLUTION on the proposal for a decision of the European Parliament and of the Council on the mobilisation of the European Globalisation Adjustment Fund (application from the Netherlands EGF/2016/005 NL/Drenthe Overijssel Retail ) (COM(2016)0742 C8-0000/ /0000(BUD)) The European Parliament, having regard to the Commission proposal to the European Parliament and the Council (COM(2016)0742 C8-0000/0000), having regard to Regulation (EU) No 1309/2013 of the European Parliament and of the Council of 17 December 2013 on the European Globalisation Adjustment Fund ( ) and repealing Regulation (EC) No 1927/2006 1, having regard to Council Regulation (EU, Euratom) No 1311/2013 of 2 December 2013 laying down the multiannual financial framework for the years , and in particular Article 12 thereof, having regard to the Interinstitutional Agreement of 2 December 2013 between the European Parliament, the Council and the Commission on budgetary discipline, on cooperation in budgetary matters and on sound financial management 3 (IIA of 2 December 2013), and in particular point 13 thereof, having regard to the trilogue procedure provided for in point 13 of the IIA of 2 December 2013, having regard to the letter of the Committee on Employment and Social Affairs, having regard to the letter of the Committee on Regional Development, having regard to the report of the Committee on Budgets (A8-0000/2017), A. whereas the Union has set up legislative and budgetary instruments to provide additional support to workers who are suffering from the consequences of major structural changes in world trade patterns or of the global financial and economic crisis and to assist their reintegration into the labour market; B. whereas the Union s financial assistance to workers made redundant should be dynamic and made available as quickly and efficiently as possible, in accordance with the Joint Declaration of the European Parliament, the Council and the Commission adopted during the conciliation meeting on 17 July 2008, and having due regard to the IIA of 2 December 2013 in respect of the adoption of decisions to mobilise the European Globalisation Adjustment Fund (EGF); 1 OJ L 347, , p OJ L 347, , p OJ C 373, , p. 1. PR\ docx 3/11 PE v01-00

4 C. whereas the adoption of the EGF Regulation reflects the agreement reached between the Parliament and the Council to reintroduce the crisis mobilisation criterion, to set the Union financial contribution to 60 % of the total estimated cost of proposed measures, to increase efficiency for the treatment of EGF applications in the Commission and by the Parliament and the Council by shortening the time for assessment and approval, to widen eligible actions and beneficiaries by introducing self-employed persons and young people and to finance incentives for setting up own businesses; D. whereas the Netherlands submitted application EGF/2016/005 NL/Drenthe Overijssel Retail for a financial contribution from the EGF, following redundancies in the economic sector classified under the NACE Revision 2 Division 47 (Retail trade, except of motor vehicles and motorcycles) mainly in the NUTS level 2 regions of Drenthe (NL13) and Overijssel (NL21) and whereas 800 out of redundant workers eligible for the EGF contribution are expected to participate in the measures; E. whereas the application was submitted under the intervention criteria of Article 4(1)(b) of the EGF Regulation, which requires at least 500 workers being made redundant over a reference period of nine months 1 in an enterprise operating in the same economic sector defined at NACE Revision 2 Division and located in two contiguous regions defined at NUTS 2 level in a Member State; F. whereas there were significant changes in consumer sentiment, such as the decline in sales in the middle price category and the growing popularity of internet shopping; whereas the development of new shopping areas in many Dutch cities outside the city centres and the declining trust of consumers 2 in the economy also affected negatively the position of the conventional retail sector; G. whereas the Netherlands argues that the Dutch financial sector is, as a global player, bound by international rules, including rules for financial reserves, and that, as a consequence of having to meet the new international standards, the banks have lower resources than before for financing the economy,; 1. Agrees with the Commission that the conditions set out in Article 4(1)(b) of the EGF Regulation are met and that, therefore, the Netherlands are entitled to a financial contribution of EUR under that Regulation, which represents 60% of the total cost of EUR ; 2. Notes that the Netherlands submitted the application for a financial contribution from the EGF on 12 July 2016, and that the assessment of that application was finalised by the Commission on 29 November 2016 and notified to Parliament on Notes that the retail trade, except of motor vehicles and motorcycle sector, has been the subject of 6 EGF applications, all based on the global financial and economic crisis 3 ; 1 The reference period of ninemonths for the application runs from 1 August 2015 to 1 May EGF/2010/010 CZ/Unilever, COM(2011)0061; EGF/2010/016 ES/Aragón retail, COM(2010)0615; EGF/2011/004 EL/ALDI Hellas, COM(2011)0580; EGF/2014/009_EL/Sprider stores, COM(2014)0620; EGF/2014/013_EL/Odyssefs Fokas, COM(2014)0702; EGF/2015/011_GR/Supermarket Larissa, COM(2016)0210. PE v /11 PR\ docx

5 4. Notes that weak financial position of the bigger department stores made it impossible to invest in other shop models in order to achieve the necessary changes and to be competitive again; 5. Points out that, in the Netherlands, the labour market is recovering slowly from the crisis and that the effects are still visible in certain sectors and, like the retail trade, some sectors have only more recently started to really suffer from the consequences of the financial economic crisis; 6. Observes many redundancies in the Dutch retail sector in the past few months with the main department stores of the sector suffering from bankruptcies, which triggered a total number of redundancies in the period ; notes with regret that the volume of goods sold in retail sector followed this pattern from -2 % in 2011 to -4 % in 2013, with purchases still 2,7 % under the 2008 level 2 ; 7. Underlines that both the Drenthe and Overijssel regions have suffered considerably especially from bankruptcies in the retail sector; regrets that the share of employment in this sector in both provinces is considerable and that, therefore, the loss of jobs has a strong negative effect on the economy of both regions and that the redundancies in the retail sector contributed to that negative development 3 ; 8. Regrets that younger workers are the most affected with 67,1 % of the targeted beneficiaries being below 30 years old; 9. Acknowledges the fact that the Netherlands has indicated that the application, particularly the coordinated package of personalised services, has been drawn up in consultation with stakeholders, social partners, representatives of the retail sector and of the regions; 10. Notes that the Netherlands is planning seven different actions, all of which are personalised and targeted services: intake, job search assistance and case management, mobility pool, outplacement assistance, training and retraining, entrepreneurship promotion training and coaching, and entrepreneurship promotion grant; acknowledges the fact there is no allowances and pay-subsidies in that package; 11. Recalls that, in line with Article 7 of the EGF Regulation, the design of the coordinated package of personalised services supported by the EGF should anticipate future labour market perspectives and required skills and should be compatible with the shift towards a resource-efficient and sustainable economy; 12. Notes that the Netherlands confirms that the eligible actions do not receive assistance from other Union financial instruments; 13. Recalls the importance of improving the employability of all workers by means of adapted training and the recognition of skills and competences gained throughout a Focus on consumption, Economic Agency ABN-AMRO Mathijs Deguelle and Nico Klene. Volume development retail sector. 24 January Retail sector prognoses, Economic Agency ABN-AMRO Sonny Duijn paragraph January Figures by UWV April 2016 PR\ docx 5/11 PE v01-00

6 worker's professional career; expects the training on offer in the coordinated package to be adapted not only to the needs of the dismissed workers but also to the actual business environment; 13. Reiterates that assistance from the EGF must not replace actions which are the responsibility of companies by virtue of national law or collective agreements nor of measures for restructuring companies or sectors; 14. Asks the Commission to ensure public access to the documents related to EGF cases; 15. Approves the decision annexed to this resolution; 16. Instructs its President to sign the decision with the President of the Council and arrange for its publication in the Official Journal of the European Union; 17. Instructs its President to forward this resolution, including its annex, to the Council and the Commission. PE v /11 PR\ docx

7 ANNEX: DECISION OF THE EUROPEAN PARLIAMT AND OF THE COUNCIL on the mobilisation of the European Globalisation Adjustment Fund following an application from the Netherlands EGF/2016/005 NL/Drenthe Overijssel Retail THE EUROPEAN PARLIAMT AND THE COUNCIL OF THE EUROPEAN UNION, Having regard to the Treaty on the Functioning of the European Union, Having regard to Regulation (EU) No 1309/2013 of the European Parliament and of the Council of 17 December 2013 on the European Globalisation Adjustment Fund ( ) and repealing Regulation (EC) No 1927/2006 1, and in particular Article 15(4) thereof, Having regard to the Interinstitutional Agreement of 2 December 2013 between the European Parliament, the Council and the Commission on budgetary discipline, on cooperation in budgetary matters and on sound financial management 2, and in particular point 13 thereof, Having regard to the proposal from the European Commission, Whereas: (1) The European Globalisation Adjustment Fund (EGF) aims to provide support for workers made redundant and self-employed persons whose activity has ceased as a result of major structural changes in world trade patterns due to globalisation, as a result of a continuation of the global financial and economic crisis, or as a result of a new global financial and economic crisis, and to assist them with their reintegration into the labour market. (2) The EGF is not to exceed a maximum annual amount of EUR 150 million (2011 prices), as laid down in Article 12 of Council Regulation (EU, Euratom) No 1311/ (3) On 12 July 2016, the Netherlands submitted an application to mobilise the EGF, in respect of redundancies in the economic sector classified under the Statistical classification of economic activities in the European Community(NACE) Revision 2 Division 47 (Retail trade, except of motor vehicles and motorcycles) in the Nomenclature of Territorial Units for Statistics (NUTS) 4 level 2 regions of NL13 - Drenthe and NL21 - Overijssel in the Netherlands. It was supplemented by additional information provided in accordance with Article 8(3) of Regulation (EU) 1 OJ L 347, , p OJ C 373, , p Council Regulation (EU, Euratom) No 1311/2013 of 2 December 2013 laying down the multiannual financial framework for the years (OJ L 347, , p. 884). 4 Commission Regulation (EU) No 1046/2012 of 8 November 2012 implementing Regulation (EC) No 1059/2003 of the European Parliament and of the Council on the establishment of a common classification of territorial units for statistics (NUTS) as regards the transmission of the time series for the new regional breakdown (OJ L 310, , p. 34). PR\ docx 7/11 PE v01-00

8 No 1309/2013. That application complies with the requirements for determining a financial contribution from the EGF as laid down in Article 13 of Regulation (EU) No 1309/2013. (4) The EGF should, therefore, be mobilised in order to provide a financial contribution of EUR in respect of the application submitted by the Netherlands. (5) In order to minimise the time taken to mobilise the EGF, this decision should apply from the date of its adoption, HAVE ADOPTED THIS DECISION: Article 1 For the general budget of the Union for the financial year 2017, the European Globalisation Adjustment Fund shall be mobilised to provide the amount of EUR in commitment and payment appropriations. Article 2 This Decision shall enter into force on the day of its publication in the Official Journal of the European Union. It shall apply from [the date of its adoption]. Done at [...], For the European Parliament The President For the Council The President Date to be inserted by the Parliament before the publication in OJ. PE v /11 PR\ docx

9 EXPLANATORY STATEMT I. Background The European Globalisation Adjustment Fund has been created in order to provide additional assistance to workers suffering from the consequences of major structural changes in world trade patterns. According to the provisions of Article 12 of Regulation (EU, Euratom) No 1311/2013 laying down the multiannual financial framework for the years [1] and of Article 15 of Regulation (EU) No 1309/2013 [2], the Fund may not exceed a maximum annual amount of EUR 150 million (2011 prices). The appropriate amounts are entered into the general budget of the Union as a provision. As concerns the procedure, according to point 13 of the Interinstitutional Agreement of 2 December 2013 between the European Parliament, the Council and the Commission on budgetary discipline, on cooperation in budgetary matters and on sound financial management [3], in order to activate the Fund the Commission, in case of a positive assessment of an application, presents to the budgetary authority a proposal for mobilisation of the Fund and, at the same time, a corresponding request for transfer. In the event of disagreement, a trilogue shall be initiated. II. The Netherlands application and the Commission's proposal 1. On 29 November 2016, the Commission adopted a proposal for a decision on the mobilisation of the EGF in favour of the Netherlands to support the reintegration in the labour market of workers made redundant after the bankruptcy and closure of 6 enterprises in the NACE Rev. 2 division 47 (Retail trade, except of motor vehicles and motorcycles) mainly in the NUTS [4] level 2 region ofnl13 - Drenthe and NL21 - Overijssel. Enterprises and number of dismissals within the reference period Aktiesport (Drenthe) 41 Perry Sport (Drenthe) 19 Aktiesport (Overijssel) 84 Perry Sport (Overijssel) 36 Dolcis (Drenthe) 19 Scapino (Drenthe) 209 Dolcis (Overijssel) 44 Scapino (Overijssel) 213 Manfield (Drenthe) 11 V&D (Drenthe) 125 Manfield (Overijsse) 27 V&D (Overijssel) 268 Total no. of enterprises: 6 Total no. of dismissals: Total no. of self-employed persons whose activity has ceased: 0 [1] OJ L 347, , p [2] OJ L 347, , p [3] OJ C 373, , p. 1. [4] CommissionRegulation (EU) No 1046/2012 of 8 November 2012 implementingregulation (EC) No 1059/2003 of the European ParliamentandoftheCouncil on theestablishmentof a commonclassificationofterritorialunits for statistics (NUTS) as regardsthetransmissionofthe time series for thenewregionalbreakdown (OJ L 310, , p. 34). PR\ docx 9/11 PE v01-00

10 Enterprises and number of dismissals within the reference period Total no. of eligible workers and self-employed persons: This is the 1st application to be examined under the 2017 budget and the 6th for theretail trade, except of motor vehicles and motorcycles,and refers to the mobilisation of a total amount of EUR from the EGF for The Netherlands. It concerns 800 workers made redundant. The application was sent to the Commission on 12 July 2016 and supplemented by additional information up to 6 September The Commission has concluded, in accordance with all applicable provisions of the EGF Regulation, that the application meets the conditions for a financial contribution from the EGF, as referred to in Article 4(1)(b) of the EGF Regulation. Although the Dutch labour market is recovering slowly from the crisis the effects are still visible in certain sectors. Some sectors like the retail have only more recently started to really suffer from the consequences of the financial economic crisis. Some of the biggest retail shops in the Netherlands went bankrupt by the end of An analysis illustrates the 10 biggest bankruptcies in the retail sector over the years, the number of branches/shops that were closed and the number of jobs lost [5]. The trend of bankruptcies was already going on in the middle of the crisis ( ), first striking the smaller retail chains and now ( ) the bigger ones [6]. The 6 actions which are to be provided to workers made redundant consist of Intake: this measure will map the participants according to their capabilites, potentials and job perspectives. Every intake will conclude with an advice. Job search assistance and case management: this measure will start with an offer for a customised programme. Among others it will include preparation of transfer documents, intensive job application training, organising job markets and intensive contacting of employers. Mobility pool: this measure consists of a flexible pool for the job seekers and employers with temporary jobs. This service can be used for flexible deployment. This measure will provide work experience for the (retrained) workers and help them to present themselves to new employers. Outplacement assistance: this measure will offer job orientation, job counseling and competence training. Training and retraining: this measure will provide training, re-training and other educational facilities, for the retail sector and for new occupational profiles, such as transport, IT services, technical professions and others. [5] [6] Theme economy PE v /11 PR\ docx

11 Entrepreneurship promotion training and coaching: some of the participants can use their commercial skills and experience to start their own business. This measure will provide training and coaching to them, by developing their skills, drafting a sustainable business plan and by guiding them through the legislative procedures. Entrepreneurship promotion grant: this measure will give a grant for covering investment costs, if the participant will obtain the necessary skills and will have a sustainable business plan. The above mentioned package of measures is additional to the regular services provided for dismissed persons. These measures are personalised and targeted at the dismissed worker, where entrepreneurship measures are targeted to a limited number of person with realistic business projects. According to the Commission, the described measures constitute active labour market measures within the eligible actions set out in Article 7 of the EGF Regulation. These actions do not substitute passive social protection measures. The Netherlands has provided all necessary assurances regarding the following: III. Procedure the principles of equality of treatment and non-discrimination will be respected in the access to the proposed actions and their implementation, the requirements laid down in national and EU legislation concerning collective redundancies have been complied with, the proposed actions will not receive financial support from other Union funds or financial instruments and any double financing will be prevented, the proposed actions will be complementary with actions funded by the Structural Funds, the financial contribution from the EGF will comply with the procedural and material Union rules on State aid. In order to mobilise the Fund, the Commission will submit to the Budget Authority a transfer of appropriation for a global amount of EUR This is the 1st transfer proposal for the mobilisation of the Fund transmitted to the Budgetary Authority to date during The trilogue procedure shall be initiated in the event of disagreement, as provided for in Article 15(4) of the EGF Regulation. According to an internal agreement, the Employment and Social Affairs Committee should be associated to the process, in order to provide constructive support and contribution to the assessment of the applications from the Fund. PR\ docx 11/11 PE v01-00