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European Council deal welcome but there’s little to celebrate for Europe’s industrial workers in the small-print


22 Jul 2020


Social Europe & Jobs

Yesterday, marathon talks between Europe’s political leaders finally concluded with a deal reached on the EU’s recovery plan. Days and nights of negotiations saw the original Commission proposals for an ambitious EU plan of massive investment in the Green Deal whittled down by ‘frugal’ governments. While, industriAll European Trade Union recognises and welcomes the historic significance of the decision to fund the recovery plan through Eurobonds, guaranteed directly by the EU, the proposed recovery plan and multiannual financial framework give little solace to industrial workers buffeted by a perfect storm of the pandemic, and structural change due to decarbonisation and digitalisation.

IndustriAll Europe’s General Secretary Luc Triangle said, “At industriAll Europe, we welcome the historic decision of member states to borrow collectively to invest – this marks a shift since 2008/9. However, we had called on Europe’s leaders to recognise the scale of the challenges that our members face in the coming weeks and months – but instead Europe’s leaders decided to slice and dice every budget focused on support for workers and our communities. From the Just Transition funding to the Globalisation Adjustment Fund, Europe’s industrial workers have been left on the cutting room floor. These are short term cuts which will have long term ramifications.”

Europe’s leaders agreed a €1.8 trillion package on Tuesday 21 July in the morning, after 4 days of negotiations in the European Council. Within the package, the Just Transition Fund, which will be a key instrument to support regions and workers affected by the transition to a net zero carbon economy, was reduced from the initial Commission proposal in May of €40 bn (€10bn in the MFF+€30 in NextGenEU) to €17.5 bn (€7.5 in MFF+ €10 in NextGenEU). The European Globalisation Adjustment Fund, which was instrumental in supporting up to 26,000 workers a year (mostly in industry) during the financial crisis, also saw its proposed budget cut from €386m per year to €186m. A proposed Solvency support programme has been discarded in European Council’s deal whereas the Commission’s proposals in May included a €26bn Fund. In the same way, ReactEU, as designed by the EU Council has €7.5bn less to support regions and sectors the most impacted by COVID19. Furthermore, cuts to proposed research funding and the scale of spending for transport infrastructure (notably rail infrastructure) also weaken our collective ability to address concerns about climate change and deliver the Green Deal in a socially acceptable manner. Beyond the package, we must ensure that austerity does not creep into the governance of the recovery plan, as national governments’ plans will be subject to veto within the European Council. Scrutiny and transparency are welcome but further cuts by the backdoor will not be.

After taking the time to consider the small print, industrialAll Europe is concerned that the European Council has had a Pyrrhic victory. Europe’s leaders have demonstrated that they can find agreement, but they haven’t delivered on the legitimate expectations of working people nor have they shown that they understand the scale of the crisis facing millions of workers in the coming months and years. History must not be repeated: workers must not bear the cost of this crisis and thus provide fuel for populist and far-right movements attacking European unity. Attention must now turn to the European Parliament to rectify and redress the weaknesses of the deal to ensure that the EU has a solid plan for recovery and Just Transition. IndustriAll Europe will be working with MEPs to get a more balanced result for industrial workers.

For more information: Andrea Husen-Bradley (Press and Communications) or Benjamin Denis (Industrial Policy Advisor)