EPSU Position Paper on the Social Investment Package

(Brussels, 28 November 2013)

Following the Executive Committee of 26 and 27 November 2013, we issue an “EPSU Position on the Social Investment Package (SIP)”, finalised already in August. The document was later formally endorsed by EPSU’s Executive Committee of 11/12 February 2014 and builds on an “EPSU Working Document” adopted by the EPSU Executive Committee on 17 April 2013.

EPSU Position SIP (20 August 13)

We put our main messages upfront:

• EPSU welcomes the turn in the Commission strategy by recognising the need for social investment across the EU. We recommend the SIP to be integrated into a new European Social Agenda that can provide a framework for implementing and evaluating the different initiatives and that would also make the governance of European social policy more transparent and accountable. Given that social policy remains largely a national competence, EU activities in this area must be especially sensitive to democratic and participatory requirements while not losing sight of their purpose: upwards European social convergence

• While the SIP affirms in general that social expenditure is often an investment rather than a cost, it focuses largely on questions of cost-efficiency and budgetary constraints (and partially on more conditionality of benefits). EPSU insofar calls for the reversal of misguided macro-economic policies including austerity measures going against social investment.

• The SIP could also draw attention to the benefits of sustainable, solidarity-based, public funding in key areas, including in healthcare, long-term care and childcare. The SIP could also highlight the problems caused by relying on profit-making companies to provide public services.

• The role of social dialogue should also be better articulated in the SIP. In all the policy fields touched on by the SIP, social partners play a key role in putting into place reforms essential to ensure quality services for citizens, including in three key areas: reforms in health care and elderly care; professionalisation of caring work (elderly care; care for persons with disabilities; child care); support of more gender equality due to care services

• Although the SIP calls for investment it makes little reference to the need for increased public investment in social policies and sources of income leading to fairer taxation, including by means of taxes on assets, higher incomes, a Financial Transactions Tax (FTT)

• EPSU is concerned about the implications of private money in this sector. The SIP should draw attention to the benefits of sustainable, solidarity-based, public funding in key areas, including in healthcare, long-term care and childcare. It could also highlight the problems caused by relying on profit-making companies to provide public services. The EC has carried out no evaluation of the risks (or benefits) of social impact bonds and other financial instruments (e.g. PPPs) yet presents these as a potential answer to public funding shortages. EPSU stresses that there is no evidence that private financing of (public) welfare produces more and better services.

EPSU’s analysis and evaluation of the Communication “Towards Social Investment for Growth and Cohesion – including implementing the European Social Fund 2014-2020” (COM(2013)83 final) of 20 February 2013 is complemented by four annexes:

• Annex 1: EPSU’s priorities for health, long-term care and childcare

• Annex 2: Dangers of private investment/finance in social welfare

• Annex 3: Summary and assessment of SWDs “investing in health”
and “long-term care in ageing societies” and of recommendation on “investing in children”

• Annex 4: Practical example from Austria and the sector of childcare illustrating the benefits of a social investment approach.

On 22 November 2013 the European Commission published the “SIP Roadmap 2013-2014”, a 10 pages document setting out concrete initiatives, their objectives and deliverables of the SIP. These are summarised under 3 main headings:

1. Strengthening the social investment approach through the European Semester => European Economic Governance

2. Making the best use of EU funds to support social investment

3. Streamlining governance and reporting

EC SIP Policy Roadmap (22 November 2013)

In the weeks to come, EPSU will analyse this document to see with regard to a possible role of EPSU and its affiliates with regard to selected parts under the SIP. The following list gives a first idea of potentially relevant initiatives:

• Setting up of an Expert Panel on effective ways of investing in health
that first met on 11 and 12 June 2013

• An initiative to be launched in June 2014 with the aim to support MS in the design of reform strategies for more cost-effective social protection systems

• Report on progress towards the achievements of the Barcelona targets, to support Member States’ efforts to invest in early childhood education and care (ECEC), of June 2013, in the broader context of the European Platform for Investing in Children

• Annual Report on Progress on Equality between Women and Men, and dedicated reports to specific issues concerning gender equality in employment and social fields

• Study to assess the financial, economic and social returns on different forms of social investment, to be started in January 2014

Further reading

On 20 February 2013 the European Commission had published the Communication “Towards Social Investment for Growth and Cohesion – including implementing the European Social Fund 2014-2020”, COM(2013)83 final.

• The European Commission sees the SIP as part of initiatives supported by the EU to adapt the social protection systems to better address challenges related to the consequences of demographic change, risks of structural labour market shortages in some sectors and professions in the future and caused by the financial and economic crisis and cuts in public budgets.

• The Social Investment Package (SIP) consists of the Communication “Towards Social Investment for Growth and Cohesion”, a Recommendation “Investing in Children” and a number of Staff Working Documents (SWD), i.a.: “Long-term care in ageing societies – Challenges and policy options”, “Investing in Health”, a follow up to the “Recommendation on active inclusion of people excluded from the labour market” and the “3rd Biennial Report on Social Services of General Interest”.

• With the SIP the EC also intends to show how a social investment approach can contribute to economic growth and social cohesion, not least by using money made available in the European Social Fund 2014-2020.

• Content-wise social policies are seen as a tool to make labour markets more flexible and to facilitate an adaptation of the labour force to changes with regard to qualifications, skills, competences. A key challenge is also seen to make social protection systems support cross-border mobility in the European labour market.

• With the SIP the EC intend to give guidance on national reforms needed to make progress towards the objectives of the Europe 2020 Strategy. The EC identifies the procedures of the European Economic Governance as one tool to strengthen the social investment approach. This also means that we can see links between the initiatives and aims of the SIP and the Country-Specific Recommendations e.g. in the fields of health, elderly care and child care.