The European Economic and Social Committee (EESC) has called for changes to the European Union’s State aid rules in order to recognise and better accommodate the needs of social economy entities, which play a critical role in tackling societal challenges.

In its opinion on How to support social economy entities in line with State aid rules: thoughts following the suggestions in Enrico Letta’s report, adopted at its plenary session in January, the EESC warns that existing regulations are failing to provide adequate support to these enterprises, which often reinvest their profits in efforts to achieve social objectives instead of distributing them to investors.

‘We want to make more people aware of the benefits of effective regulation on competition and State aid for both social economy enterprises and the entire system of services of general interest’, said the opinion’s rapporteur, Giuseppe Guerini.

Social economy entities – which range from cooperatives to mutual societies and foundations – employ over 11 million people across the EU, i.e. 6.3% of the working population. They operate in areas such as social and health services, renewable energy and poverty alleviation. Despite their contributions, many face systemic barriers to securing long-term investment capital and navigating public procurement processes, as the current regulatory framework often fails to account for their non-profit or solidarity-based nature.

Among other things, the EESC’s opinion highlights the fact that public authorities are underutilising existing tools such as the General Block Exemption Regulation (GBER) and the framework for services of general economic interest (SGEIs).

That is why the Committee is calling for simplification and modernisation of the overly complex and outdated rules under the GBER for supporting the employment of disadvantaged and disabled workers, in line with some of the recommendations from the Letta Report on the single market.

While the recent increase in de minimis aid ceilings – €300 000 for ordinary companies and €750 000 for SGEI entities – is welcomed, the EESC also argues that more tailored instruments, such as the GBER or specific SGEI provisions, would better address the needs of social economy entities in fields like health and social services. (ll)