During the past year or so, the European Commission embarked on a consultation process on the European Pillar of Social Rights. This policy framework deals with social policy and employment and aims to create a more social and fair Europe.
This policy process is subject to negotiation and approval by the European Parliament and the European Council of Ministers. The Commission will launch its proposal around March and it will then host a ‘social summit for fair jobs and growth’ in Gothenburg, Sweden on November 17.
According to Commission President Jean-Claude Juncker, the pillar should initially apply to Eurozone countries but other EU member states would be free to join. The pillar aims to screen employment and social matters of participating member states and to drive reforms at national level within an EU framework.
This means that rather than adopting a rigid one-size-fits-all model for the EU, the proposed model aims for a general framework with minimum standards that respect differences among member states. A similar approach was used by the EU for its climate change commitments. Here, different and particular member states have different targets within the universal EU commitment.
An important European institution in this regard is the European Economic and Social Committee (EESC). This consultative committee comprises civil society representatives from all member states. Malta’s five representatives represent employers, workers and women’s organisations respectively.
Last January, the EESC produced an important document which should serve as an important backbone to the EU’s social pillar process.
It emphasised the perils of short-sighted national interests and anti-EU political parties “with quick answers but no solutions”. Other challenges which were referred to include pressures from outside the EU and to loss of trust by many persons towards political leaders and the European project.
Comparatively low growth rates within the EU and abuses such as social dumping, were highlighted as immediate social challenges. An example of the latter includes the posting of workers from one member state to another primarily to pay them lower wages than what is paid other workers doing the same job. This type of exploitation should be tackled so as to build confidence in fair competition within the European single market.
In this regard, the EESC emphasises the need for clear and coherent governance. European, national and local governing bodies shouldn’t encourage the loss of social rights for example in public procurement. The latter is often characterised by public entities buying private services at dirt-cheap prices at the expense of workers’ conditions.
According to the EESC, lack of good governance also takes place when workers who move to other EU member states encounter bureaucratic difficulties in recognition of their skills and qualifications and other social requirements. Increased standardisation of public service procedures can free workers from a big source of anxiety and insecurity in their everyday lives.
Of particular relevance to Malta is the EESC’s concern on regulatory gaps in taxation policy. In my view, the concern here is twofold. First, Malta is gaining the reputation of a country with preferential tax rates for foreign companies, thus encouraging tax avoidance. And second, Malta’s government remains stubbornly attached to the Panama Papers controversy, thus resulting in lack of credibility when it talks about good governance. Malta’s current EU presidency only adds to the embarrassment.
Hopefully, the European Commission, Parliament and Council will take heed of the concerns of the EESC, thus ensuring that the European social pillar respects diversity within a framework of fair competition and high social standards.
Indeed, the creation of a social pillar can help reassert the European Union’s role as the largest investor in people’s social welfare and social rights. Countries such as Sweden, Denmark and Finland have consistently shown that social investment and economic competitiveness are not necessarily adverse poles. These countries top global tables in such respective areas.
The social pillar can also have an important political spin-off by constructing a European narrative which resonates with the aspirations, anxieties and hopes of millions of citizens who are being seduced by Eurosceptic narratives.
Incidentally, the UK’s departure from the EU could serve as a blessing in disguise, particularly when the UK has frequently blocked proposals for a more social Europe.