Explanatory Memorandum to COM(2012)729 - Establishing a Youth Guarantee - Main contents
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This page contains a limited version of this dossier in the EU Monitor.
| dossier | COM(2012)729 - Establishing a Youth Guarantee. |
|---|---|
| source | COM(2012)729  |
| date | 05-12-2012 |
High and increasing youth unemployment has dramatic consequences for our economies, our societies and young people themselves.
The youth unemployment rate across the EU has reached a high level of 22.7% (third quarter 2012), twice as high as the adult rate[1], and prospects do not show any reversing trend. Around 5.5 million young people are unemployed and more than 7.5 million young people under 25 are currently not in employment, education or training (NEETs).
But beyond the immediate effects of the crisis, even at lower rates, youth unemployment and inactivity are expensive and damaging to society. They are expensive today in terms of benefits being paid out and in terms of foregone earnings and taxes, but they are also expensive in the future as they lead to a number of ‘scarring’ effects, with long-lasting negative impacts on future income levels, future risks of unemployment, health status, well-being and pension reserves. Europe cannot afford to waste its talent and its future.
The need to take action and support young people in their transition from school into employment had already been identified prior to the crisis. In 2005, the Council agreed, in the context of the Employment policy guidelines (2005-2008), that policies should ensure that ‘every unemployed person is offered a new start before reaching 6 months of unemployment in the case of young people’. In 2008, the Council reduced the time period to ‘no more than 4 months’ for young people having left school.
As by 2010, implementation of such a measure across the EU had not yet taken place, both the European Parliament (EP) and the European Youth Forum were strongly advocating for Youth Guarantees to be set up at EU level.
In the framework of the Europe 2020 Strategy and its ‘Youth on the Move’ flagship initiative the Commission called in particular upon Member States to ensure that all young people are in a job, further education or activation measures within four months of leaving school and to provide this as a ‘Youth Guarantee’.
The years 2011 and 2012 have seen repeated calls for this, in particular from the European Council, the European Parliament and the European Youth Forum, but without much success on the ground.
In the Employment Package of April 2012, the Commission announced that it would propose a Council recommendation on Youth Guarantees by the end of the year.
On 29 June 2012, the European Council urged Member States to step up efforts to increase youth employment, with ‘the objective that within a few months of leaving school, young people receive a good quality offer of employment, continued education, apprenticeship or a traineeship’. It further concluded that these measures can be supported by the European Social Fund (ESF) and that Member States should use the possibilities of financing temporary recruitment subsidies from the Fund.
In the 2013 Annual Growth Survey[2], the Commission stressed that Member States should secure school-to-work transitions for young people and develop and implement Youth Guarantee schemes whereby every young person under 25 receives an offer of employment, continued education, an apprenticeship or a traineeship within four months of leaving formal education or becoming unemployed. Such schemes can be co-financed by the European Social Fund.
The Commission is proposing a proposal for a Council Recommendation to ensure that young people receive a quality offer of employment, further education or training within four months of becoming unemployed or leaving formal education. This proposal also sets out how a Youth Guarantee scheme should be set up. The proposal lists guidelines on the basis of six axes - establishing strong partnerships with all stakeholders, ensuring early intervention and activation to avoid young people becoming NEETs, taking supportive measures that will enable labour integration, making full use of EU funding to that end, assessing and continuously improving the Youth Guarantee schemes, and implementing the schemes rapidly. The proposal also outlines how the Commission will support Member States’ action: the EU funding framework, the exchange of good practices among Member States, monitoring of Member States’ actions within the European Semester exercise and supporting awareness raising activities.
The proposal is accompanied by a Staff Working Document (SWD), which goes into more details about what constitutes a Youth Guarantee, addresses questions about costs and benefits of such schemes, and describes one by one the ingredients necessary to make the Youth Guarantee a success. Furthermore, in an annex, the SWD presents policies supporting youth employment already in place in the 27 Member States and Croatia, reflecting the various starting points of these countries towards setting up fully-fledged Youth Guarantee schemes.
Contents
The Danish Presidency organised a workshop on ways to fulfil a Youth Guarantee in the framework of the Informal Meeting of Employment and Social Affairs Ministers held in Horsens on 24-25 April 2012. At this meeting, it was underlined that education and training policies should join up with employment policies, that efforts should be concentrated on problematic groups, namely those lacking qualifications/educational degrees and that approaches should be tailored to the national context and to the specific individual concerns. Finally, it was stressed that public authorities need to support young people, in particular those most vulnerable, but also that young people should engage themselves in the process and accept duties and responsibilities. The European Social Fund was referred to as a potential source of finance, especially in light of the need to implement austerity/fiscal consolidation measures.
As part of the yearly questionnaire sent to the Public Employment Services (PES) Network on their adjustment capacity to the crisis, the 2012 edition, launched in January, included a module on actions taken to address youth unemployment. Their replies were considered when drafting the SWD supporting the present proposal.
In June 2012, in the context of the meeting of the Heads of PES (HoPES) under the Danish Presidency, members of this network were asked to report on developments since January 2012 specifically targeting youth.
As a follow-up to the Employment Package, the prospect of an initiative on a Youth Guarantee was discussed with social partners on 19-20 June 2012.
At the ‘Jobs for Europe’ conference[3], held on 6-7 September 2012 in Brussels and attended by all relevant stakeholders, including the social partners and youth organisations, a broad majority of speakers expressed their support for establishing a Youth Guarantee throughout the EU, recognising that young people need to be given the right start in life, particularly in times as difficult as these.
Representatives of the European Youth Forum and of cross-sectoral social partner organisations were met in September 2012.
The Youth Guarantee initiative was discussed once more with Social Partners at the Social Dialogue Committee on 23 October 2012.
Legal Basis: For a proposal on the Youth Guarantee with Employment policies (Title IX TFEU) as centre de gravité, Article 292 TFEU constitutes an appropriate legal basis for the adoption of a recommendation. The competence of the Union regarding employment policies is defined by Title IX TFEU, which does not provide for a specific legal basis for the adoption of a recommendation. In particular, Article 149 TFEU only envisages 'incentive measures designed to encourage cooperation between Member States and to support their action in the field of employment through initiatives aimed at developing exchanges of information and best practices', which are not the subject matter of the present Recommendation.
Subsidiarity and proportionality: The Commission, along with all Member States, is very concerned about the current labour market situation for young people and its persistent deterioration. The dramatic levels of youth unemployment affect the whole of Europe: their costs are high now and in the future. The savings achieved through the Youth Guarantee go beyond the pure social protection expenditure savings achieved. Avoiding unemployment and the deterioration of skills would lead to longer-term benefits for young people and for the economy through lower unemployment over the course of the lifecycle, higher incomes (and therefore also higher tax incomes and social security contributions) and through fewer social and health problems i.
Following the lack of implementation of a number of political calls from both the Council and the European Parliament to set up Youth Guarantee schemes, it is now necessary to issue this recommendation to Member States. Indeed, so far only a limited number of Member States have taken measures towards implementing a comprehensive Youth Guarantee scheme.
Offering guidelines at EU level on tools that contribute towards an effective Youth Guarantee scheme will enable Member States to make best use of Cohesion Funds, and in particular of the European Social Fund, in order to address youth unemployment and inactivity.
The proposal recognises that different situations in individual Member States (or at regional or local level) could lead to differences in how the scheme will be set up and further implemented.
Not relevant