Workers' group - Economic Challenges

Making the European Semester social

• The European Semester must be tied to the goals of the just transition and social progress. 
• National plans should be linked to recovery goals and focus on ensuring social cohesion and reducing inequality and socio-economic insecurity. 
• ‘Make the European Semester social’: in case of any reform, workers´ interests have to be carefully respected and adequate public investment is necessary. 
• The European Semester must be complemented with instruments to address social imbalances by introducing a Social Convergence Framework. 
• Social partners, in particular trade unions, and civil society must be involved in the National Recovery and Resilience Plans and other instruments under the Multiannual Financial Framework (MFF) ; currently the rules are non-binding and the social dialogue is left at the goodwill of the national governments. We therefore call for the establishment of binding conditionality for such consultation, as involvement varies between countries and regions, also as regards other instruments under the MFF, on the basis of minimum standards defined at EU level. 

Europe needs a fiscal reform

• There is a need for a tax on financial transactions that eight countries already have in place and another on digital transactions. 
• We call for fair and progressive taxation, including the introduction of a progressive wealth tax to finance the necessary investments for a just transition. 
• We need a shift in taxation from mostly labour- based to adapt to new realities of capital-intensive businesses and not penalise labour-intensive ones.
• Proposal to tax more and in a temporary period, the richest taxpayers, linked to the after-Covid crisis. 
• There is a need for a minimum corporate tax level at European level. 
• The fight against tax fraud and tax evasion as well as against money laundering must remain high on the agenda. 
• Qualified Majority Voting is needed in tax matters instead of unanimity, which is blocking any progress. 

Pushing for a strong common EU budget

• The EU needs a strong common budget to operate, including having sufficient own resources to pursue the necessary policies. As seen in the case of the American Inflation Reduction Act, the EU needs more resources, in order to foster investment and sustainable growth, taking into account as well the new setting of state aid and the problems derived from the very high energy costs that consumers and companies face in Europe. 
• The next Multiannual Financial Framework: 
• Must ensure a strong Cohesion Policy, while promoting measures to support the efficient and full use of the available funds.
• Must ensure that access to European funding is linked to social conditionalities, including clear collective bargaining conditions, and that companies that do not comply with labour rights are excluded from it. 
• Must support the timely and full implementation of the rule of law conditionality mechanism alongside other tools and mechanisms aimed at protecting the EU’s financial interests. 

Making finance truly sustainable

• The necessary financial resources need to be redirected towards sustainable investments with a long-term approach, which takes into account environmental, social and governance aspects and policies. Building on the work already done and the renewed Sustainable Finance Strategy published in mid-2021, efforts need to be continued to establish and reinforce the EU sustainable finance framework in a harmonised way that is supported by all stakeholders, including particularly workers and consumers, as well as financial institutions, companies, and authorities. 
• The concept of sustainable finance must include not only economic and environmental but also social and governance criteria in financial rules and should be made extensive to the concept of sustainable competitiveness. 

A competitiveness that delivers for all

• Sustainable competitiveness is based on the well- being for all, social progress, equity, stabilised resilience, environmental sustainability and productivity. 
• Sustainable competitiveness is the set of institutions, all players in the economic development: independent workers, enterprises (micro enterprises, SME’s, social enterprises, large enterprises, European Champions), workers, public sector (at national, regional and local level), and policies and factors that determine the level of productivity. 
• Sustainable competitiveness is therefore a key priority for workers and citizens at large: it ensures that competitiveness is a process that improves society, rather than a race to the bottom. It is better for everyone in the long run, as everyone has – so far – the need for a planet. And it is in the interest of employers, too: not only does it help them have environmental and social stability, but it also encourages fair competition and respects the work of honest companies. 

Sustainable investment

• Investment is critical for a sustainable economic growth model in line with the twin transitions. The levels needed however cannot be attained with the current cut- backs to investment applied EU-wide. 
• A social taxonomy for sustainable investment: taxonomy should follow not only ecological, but also social criteria, providing a reliable taxonomy which makes companies that contribute to social sustainability more visible. 
• Public support for investment into social projects should be exempt from the deficit rules. 

Achieving our green transition

• Despite the turbulence linked to the global challenge of COVID-19, the Russian invasion of Ukraine and the war that has followed, and the current war in Gaza, efforts towards a more sustainable and socially inclusive economic model, the Sustainable Development Goals and, in particular, towards the transition to a green model of growth must continue. 
• The transition to the European Green Deal, if fairly implemented, creates a particular opportunity for the development of businesses based on the social economy model. This means that companies have to contribute to a Green and Social Deal within their particular capacities. Notwithstanding their goal of being profitable and competitive, they can and should contribute to make the Green Deal, the Recovery and Resilience Plans and the industrial transformation successful and socially beneficial. 

Additional demands of European workers

• Stability and Growth Pact: remains suspended for now and will need to be reformed to better reflect the investment needs of our societies, with more credible targets, duties, and obligations to avoid social regression. We call for public investment to be treated separately when deciding whether any excessive deficit procedure should be opened, to allow all Member States to undertake the public investment needed to address the common priorities. To prevent a return to old fiscal rules and to manage a shift towards a prosperity-focused and a new and modernised fiscal framework, it is necessary to resume the review process.
• SMEs represent an important cornerstone of the EU economy. However, it is equally important that SMEs respect human rights and the environment in the conduct of their business, and that they are given the opportunity to unleash their potential to contribute to sustainable development not just with jobs, but more importantly with fair wages, safe and healthy working conditions, democracy at work and high socio-environmental standards. 
• Implement the Social Economy Action Plan: social enterprises represent around 10 per cent of all enterprises in the EU. By implementing the Social Economy Action plan, the regulatory framework and the visibility of social economy enterprises will be adapted while creating an environment for the social economy to thrive, including the necessary access to markets and finance offering opportunities for them to start up and expand their activities; thereby providing public policy to support social enterprises on an equal footing with other forms of enterprise. 
• Beyond GDP: Well-chosen statistical indicators will be crucial for monitoring the progress towards achieving the SDGs and the objectives of the European Green Deal, as well as for assessing the success of the recovery and resilience plans within the European Semester process. We need an economy of well-being. 
• Public procurement: There is a need to revamp the rules, ensuring that contracts by the public administration promote collective bargaining and social dialogue, and gender equality with conditionality both on that and on fair working conditions. 
• When deepening the Banking and Capital Market Union, financial market stability, economic sustainability and social fairness should be prioritised. This means for example solid consumer protection standards. 

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