Brussels, 19/06/2013 (Agence Europe) - On Wednesday 19 June, the European Commission adopted three contributions ahead of the European Council on 27-28 June. The contributions focus on the fight against youth unemployment, examining the pact for growth and jobs, and strengthening the granting of loans to the economy.
On Wednesday, the Commission asked EU member states for a new stimulus for growth and youth employment. In particular, the Commission proposes that the €6 billion planned for the Youth Employment Initiative, as part of the 2014-2020 European budget, be used over two years and not over seven years. The Commission also calls on the member states with regions recording a youth unemployment rate above 25% to present a Youth Guarantee Implementation Plan by October.
There are currently nearly 6 million under-25 year olds without a job in Europe. The rate of youth unemployment in Europe stood at 23.5% in the first quarter of 2013 - which was equivalent to double the already very high rate recorded for the population as a whole. In some countries, over half the young people wanting to work are unemployed. The Commission proposed a series of measures as part of the Youth Employment package presented in December 2012. In March 2013, it presented the Youth Employment Initiative (YEI), which was granted €6 billion. The Commission calls on the June European Council to support these measures and it calls for the measures to be implemented.
Youth Guarantee. The Commission calls on the Council to adopt the proposed country recommendations that are linked to the Youth Guarantee and, more generally, to youth employment. The Commission calls on the member states with regions recording a youth unemployment rate above 25% to present a Youth Guarantee Implementation Plan by October. Other member states are encouraged to present similar plans by spring 2014.
Putting the European Social Fund to work for young people. The Commission calls on the European Parliament and the Council to adopt the multiannual financial framework rapidly and also the new European Structural Investment Fund (ESIF) regulations, which should ensure that a 25% minimum share of cohesion policy funding (at least €80 billion) is allocated to the European Social Fund (ESF).
Youth Employment Initiative. Last February, the European Council approved the creation of the Youth Employment Initiative (YEI), which will be financed to the tune of €6 billion as part of the EU budget. This initiative will focus on young 15-24 year olds who are not studying, do not work and are not in training, and it will complete the ESF support for the implementation of the Youth Guarantee. The Commission presented the proposals in March 2013.
The Commission has proposed concentrating YEI aid on the regions facing a youth unemployment rate of over 25% and, in these regions, on young people (who are not studying, do not work and are not in training) aged 15-24. The Commission insists that these criteria should be maintained: “any lowering of the 25% threshold would result in a sprinkling of funding, to the detriment of the regions most needing aid” (our translation).
In order to ensure that the YEI credits can be granted rapidly once the legislative framework is adopted, the Commission proposes adapting the profile of the next multiannual financial framework so as to free up all of the €6 billion commitments over the course of the first two years of the next multiannual financial framework - in other words 2014 and 2015.
Joint Commission/EIB report. A contribution from the two institutions concerns implementing the increase (of €10 billion) of EIB capital. The report sets out three options to help SMEs obtain access to funding and employ young people in the near future. Banks were able to settle their balances, and to support the immediate economy, “but not enough from our point of view”, the Commission stated. The SMEs have trouble obtaining financing although interest rates are historically low. It was therefore necessary to take a very concrete initiative - the Commission will lend money to the EIB via its structural funds and will guarantee the risk. In return, the EIB must be able to lend to the banks more easily, assuming the banks' risks, on condition that the money lent to the banks is used for lending on to SMEs. This instrument will allow not the settling of the banks' accounts but the lending of money to the banks so that they can lend to innovative SMEs, and to SMEs which support youth employment. The Commission will ask the European Council to adopt an ambitious approach on this issue.
The Commission reiterates that it has mobilised €55 billion from the structural funds for growth and employment. A spokesperson explained that, from last year, the whole of this sum was mobilised and €39 billion is now available in the EU countries to finance the real economy. The remaining €16 billion corresponds to the money made available to the countries to fight youth unemployment. The Commission says that €55 billion is in the member states and it therefore up to the member states to use it. (LC/transl.fl)