EUROPEAN PARLIAMT 2014-2019 Committee on Budgets 14.11.2014 2014/2181(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, in accordance with 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 (application EGF/2013/006 PL/Fiat Auto Poland S.A., from Poland) (COM(2014)0699 C8-0243/2014 2014/2181(BUD)) Committee on Budgets Rapporteur: Jan Olbrycht PR\1040469.doc PE541.648v01-00 United in diversity
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...10 PE541.648v01-00 2/12 PR\1040469.doc
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, in accordance with 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 (application EGF/2013/006 PL/Fiat Auto Poland S.A., from Poland) (COM(2014)0699 C8-0243/2014 2014/2181(BUD)) The European Parliament, having regard to the Commission proposal to the European Parliament and the Council (COM(2014)0699 C8-0243/2014), having regard to Regulation (EC) No 1927/2006 of the European Parliament and of the Council of 20 December 2006 on establishing the European Globalisation Adjustment Fund 1 (EGF Regulation), having regard to Council Regulation (EU, Euratom) No 1311/2013 of 2 December 2013 laying down the multiannual financial framework for the years 2014-2020 2, 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 (A8-0000/2014), 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 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 for the IIA of 2 December 2013 in respect of the adoption of decisions to mobilise the European 1 OJ L 406, 30.12.2006, p. 1. 2 OJ L 347, 20.12.2013, p. 884. 3 OJ C 373, 20.12.2013, p. 1. PR\1040469.doc 3/12 PE541.648v01-00
Globalisation Adjustment Fund (EGF), C. whereas the adoption of Regulation (EU) No 1309/2013 1 reflects the agreement reached between the Parliament and the Council to reintroduce the crisis mobilisation criterion, to increase 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 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 Poland submitted application EGF/2013/006 PL/Fiat for a financial contribution from the EGF, following 1079 redundancies, 829 in Fiat Auto Poland and 250 from 21 suppliers and downstream producers, with 777 persons expected to participate in EGF measures, linked to a decrease in production at the Tychy plant of Fiat Auto Poland S.A. ( Tychy plant of Fiat ) located in the province of Slaskie, Poland, during the reference period from 21 January 2013 to 21 May 2013, E. whereas the application fulfils the eligibility criteria laid down in the EGF Regulation, 1. Notes that the conditions set out in Article 2(a) of the EGF Regulation are met, therefore agrees with the Commission that Poland is entitled to a financial contribution under that Regulation; 2. Notes that the Polish authorities submitted the application for EGF financial contribution on 29 July 2013, supplemented it by additional information up to 16 June 2014 and that its assessment was made available by the Commission on 10 November 2014; 3. Welcomes the fact that, in order to provide workers with speedy assistance, the Polish authorities decided to initiate the implementation of the personalised services to the affected workers on 21 January 2013, well ahead of the decision on granting the EGF support for the proposed coordinated package; 4. Notes that the European automotive industry has lost market share since 2007, when European passenger car production accounted for 32,2% of global production, a percentage which fell to 23,2% in 2012; highlights, furthermore, the decrease in EU-27 production by 7% from 2011 to 2012, while world production levels increased by 5,3%, in the same period; stresses that the situation was even worse at national level where production volume decreased by almost a third in 2012 compared to 2011 levels; 5. Consequently agrees with the Commission that the redundancies in the Tychy plant of Fiat and its suppliers and downstream producers are linked to major structural changes in world trade patterns due to globalisation; underlines that the impact of globalisation has been worsened by the effect of the financial crisis, which has reduced the sales of new passenger cars in the Union to the lowest level since records began; 1 Regulation (EU) No 1309/2013 of the European Parliament and of the Council of 17 December 2013 on the European Globalisation Adjustment Fund (2014-2020) and repealing Regulation (EC) No 1927/2006 (OJ L 347, 20.12.2013, p. 855). PE541.648v01-00 4/12 PR\1040469.doc
6. Notes that the redundancies at the Tychy plant of Fiat are expected to have a negative impact on the region, as the former workers of Fiat Auto Poland, suppliers and downstream producers represent 1/10 of all the unemployed people living in the area; 7. Points out that the unemployment rate in Slaskie region has risen since 2011; notes, moreover, an increase of collective redundancies in the region that almost doubled between 2011 and 2012; 8. Notes that to date the automotive sector has been the subject of 21 EGF applications, of which 12 are based on trade related globalisation, while the other 9 are based on the crisis criterion; 9. Notes that the coordinated package of personalised services to be co-funded includes following measures for the reintegration of 777 redundant workers into employment: training and training related costs, entrepreneurial training, training scholarships, internship scholarships, internship costs, intervention works, grants for self-employment, hiring incentive; 10. Welcomes the fact that the Regional Employment Council was involved in the preparation of the application of the EGF and its role in deciding the package of activities of the project; 11. 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 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; believes that the design of the coordinated package of personalised services should anticipate future labour market perspectives and required skills and should be compatible with the shift towards a resource-efficient and sustainable economy; 12. Stresses that, in accordance with Article 6 of the EGF Regulation, it shall be ensured that the EGF supports the reintegration of individual redundant workers into stable employment; stresses, furthermore, that EGF assistance can co-finance only active labour market measures which lead to durable, long-term employment; 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 measures restructuring companies or sectors; 13. Underlines the high level of older people and people with lower qualifications affected by the redundancies and representing accordingly 18,7% and 62,6% of all affected workers; calls for special attention to those two groups and special EGF measures targeted at them; 14. Welcomes the fact that the principle of equality between women and men as well as of non-discrimination has been and will continue to be applied during the various stages of implementation of and access to the EGF measures; 15. Notes that the information provided on the coordinated package of personalised services to be funded from the EGF includes information on complementarity with actions funded by the Structural Funds; stresses that the Polish authorities confirm that the eligible actions do not receive assistance from other Union financial instruments; reiterates its call PR\1040469.doc 5/12 PE541.648v01-00
to the Commission to present a comparative evaluation of those data in its annual reports in order to ensure full respect of the existing regulations and that no duplication of Unionfunded services can occur; 16. Approves the decision annexed to this resolution; 17. 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; 18. Instructs its President to forward this resolution, including its annex, to the Council and the Commission. PE541.648v01-00 6/12 PR\1040469.doc
ANNEX: DECISION OF THE EUROPEAN PARLIAMT AND OF THE COUNCIL on the mobilisation of the European Globalisation Adjustment Fund, in accordance with 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 (application EGF/2013/006 PL/Fiat Auto Poland S.A., from Poland) 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 (EC) No 1927/2006 of the European Parliament and of the Council of 20 December 2006 establishing the European Globalisation Adjustment Fund 1, and in particular Article 12(3) thereof, Having regard to Regulation (EU) No 1309/2013 of the European Parliament and the Council of 17 December 2013 on the European Globalisation Fund (2014-2020) and repealing Regulation (EC) No 1927/2006 2, and in particular Article 23, second paragraph, thereof, Having regard to Council Regulation (EU, Euratom) No 1311/2013 of 2 December 2013 laying down the multiannual financial framework for the years 2014-2020 3, 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 4, and in particular point 13 thereof, Having regard to the proposal from the European Commission, Whereas: (1) The European Globalisation Adjustment Fund (EGF) was established to provide additional support for workers made redundant as a result of major structural changes in world trade patterns due to globalisation and to assist them with their reintegration into the labour market. (2) The EGF shall not exceed a maximum annual amount of EUR 150 million (2011 prices), as laid down in Article 12 of Regulation (EU, Euratom) No 1311/2013. 1 OJ L 406, 30.12.2006, p. 1. 2 OJ L 347, 20.12.2013, p. 855. 3 OJ L 347, 20.12.2013, p. 884. 4 OJ C 373, 20.12.2013, p. 1. PR\1040469.doc 7/12 PE541.648v01-00
(3) On 29 July 2013, Poland submitted an application to mobilise the EGF, in respect of redundancies in the enterprise Fiat Auto Poland S.A. and 21 suppliers and downstream producers, and supplemented it by additional information up to 16 June 2014. This application complies with the requirements for determining the financial contributions as laid down in Article 10 of Regulation (EC) No 1927/2006. The Commission, therefore, proposes to mobilise an amount of EUR 1 259 610. (4) The EGF should, therefore, be mobilised in order to provide a financial contribution for the application submitted by Poland, HAVE ADOPTED THIS DECISION: Article 1 For the general budget of the European Union for the financial year 2014, the European Globalisation Adjustment Fund shall be mobilised to provide the sum of EUR 1 259 610 in commitment and payment appropriations. Article 2 This Decision shall be published in the Official Journal of the European Union. Done at Brussels, For the European Parliament The President For the Council The President PE541.648v01-00 8/12 PR\1040469.doc
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I. Background EXPLANATORY STATEMT 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 2014-2020 1 and of the Article 12 of Regulation (EC) No 1927/2006 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 Fiat Poland application and the Commission's proposal On 10 November 2014, the Commission adopted a proposal for a decision on the mobilisation of the EGF in favour of Poland to support the reintegration in the labour market of workers made redundant in the production plant of Tychy of Fiat Auto Poland S.A. located in the region of Slaskie, Poland, due to major structural changes in world trade patterns due to globalisation. This is the nineteenth application to be examined under the 2014 budget and refers to the mobilisation of a total amount of EUR 1 259 610 from the EGF for Poland. It concerns 829 redundancies in the production plant of Fiat Tychy and 250 from 21 suppliers and downstream producers during the reference period from 21 January 2013 to 21 May 2013. The application is based on the intervention criteria of Article 2(a) of the EGF Regulation, which requires at least 500 redundancies over a period of four months in an enterprise in a Member State. The application was sent to the Commission on 29 July 2013. The Commission has concluded that the application meets the conditions for deploying the EGF as set out in Article 2(a) of Regulation (EC) No 1927/2006. According to data referred to by the Polish authorities, the European automotive industry has lost market share since 2007. That year European passenger car production accounted for 32.2% of global production, whereas in 2012 it had amounted to 23.2%. The applicant adds that while world production levels increased by 5.3% from 2011 to 2012, EU-27 production 1 OJ L 347, 20.12.2013, p. 884. 2 OJ L 406, 30.12.2006, p. 1. 3 OJ C 373, 20.12.2013, p. 1. PE541.648v01-00 10/12 PR\1040469.doc
decreased by 7% in the same period. According to the Polish authorities, the situation was even worse at national level, where production volume decreased by almost a third in 2012 compared to 2011 levels. The Polish authorities argue moreover, that the impact of globalisation has been worsened by the effect of the financial crisis, which has reduced the sales of new passenger cars in the EU to the lowest level since records began. While demand for new cars slumped by 8.7% in the EU-27, global car sales registered a 5.1% increase in 2012. The applicant shows the correlation between the declining car production and employment levels in Fiat Auto Poland. The plant in Tychy hired 6 422 workers in 2009 in order to produce 606 000 cars, while in 2012 production amounted to 361 000 units with 4 882 workers. Over the 2009-2013 period, while production decreased by 56%, employment dropped by only 46%. In Fiat Auto Poland the decrease in employment has therefore been less acute than the decrease in production. This was achieved by the factory operating a two shift basis instead of the regular practice of three shifts. The Polish authorities also provide Eurostat data on the employment situation in the automotive sector, where a continuous fall is demonstrated. Employment in the automotive industry in EU-27 at the end of 2009 was 12% lower than at the beginning of 2008. The coordinated package of personalised services to be co-funded includes following measures for the reintegration of 777 redundant workers into employment: Training and training related costs, Entrepreneurial training, Training scholarships, Internship scholarships, Internship costs, Intervention works, Grants for self-employment, Hiring incentive. According to the Polish authorities, the measures initiated on 21 January 2013 combine to form a co-ordinated package of personalised services and represent active labour market measures with the aim of re-integrating the workers into the labour market. As regards the criteria contained in Article 6 of Regulation (EC) No 1927/2006, the Polish authorities have confirmed in their application that: the financial contribution from the EGF will not replace measures which are the responsibility of enterprises by virtue of national law or collective agreements; the measures provide support for individual workers and are not used for restructuring enterprises or sectors; the measures will not receive financial support from other Union funds or financial instruments Concerning management and control systems, Poland has notified the Commission that the financial contribution from the EGF will be managed and controlled by the same bodies as for the ESF. The Managing Authority, responsible for the implementation of the EGF, will be the Ministry of Infrastructure and Development, and specifically the Department for the European Social Fund. The Managing Authority will transfer some of the tasks to the Intermediate Body, the Provincial Employment Office in Katowice. PR\1040469.doc 11/12 PE541.648v01-00
The Paying Authority will be the Department of Payment Authority of the Ministry of Finance. III. Procedure In order to mobilise the Fund, the Commission has submitted to the Budget Authority a transfer request for a global amount of EUR 1 259 610 from the EGF reserve (40 02 43) to the EGF budget line (04 04 51). This is the nineteenth transfer proposal for the mobilisation of the Fund transmitted to the Budgetary Authority to date during 2014. The trilogue on the Commission's proposal for a Decision on the mobilisation of the EGF could take a simplified form, as provided for in Article 12(5) of the legal base, unless there is no agreement between the Parliament and the Council. According to an internal agreement, the Employment and Social Affairs Committee will be associated to the process, in order to provide constructive support and contribution to the assessment of the applications from the Fund. PE541.648v01-00 12/12 PR\1040469.doc