Commission proposes broader, faster EU social and employment funds

The Commission has proposed to amend the European Social Fund Plus (ESF+) and the European Globalisation Adjustment Fund for Displaced Workers (EGF) to broaden their scope and make it easier to mobilise support for workers. 

Under the proposed changes, Member States would gain more flexibility to redirect ESF+ funding towards skills development in strategic sectors, such as defence and clean industries, and to provide additional support to regions bordering Russia, Belarus and Ukraine, which are facing specific challenges linked to Russia’s military aggression against Ukraine. 

The EGF would also be able to intervene earlier - before job losses occur - and mobilise support more quickly through a simplified procedure. 

Adapting ESF+ to boost skills and resilience in face of geopolitical shifts

The ESF+ is the EU’s main instrument for investing in people, with a budget of €95.8 billion for 2021-2027. Together with other EU funds, it supports the Union of Skills - the EU’s strategy to improve high quality education, training, and lifelong learning.

Member States will be able to invest more easily in skills for Europe’s strategic sectors including the defence industry, the green transition and automotive as well as  regions affected by Russia’s unjustified aggression against Ukraine, thanks to the new amendments proposed by the Commission.

The new rules will make it easier for Member States to adjust their programmes and shift planned ESF+ resources towards these new priorities. With the proposed changes, when Member States decide to use ESF+ funds in these areas, they can benefit from immediate financial injection and further flexibilities. In addition, the proposal also introduces specific financial support for regions bordering Russia, Belarus and Ukraine, including increased pre-financing and the possibility for the EU to fully finance ESF+ projects in these areas, acknowledging the lasting social and economic impact of Russia’s war of aggression.

Strengthening EGF to cover more workers and provide quicker access to help

The EGF supports dismissed workers and self-employed people who have lost their jobs due to unexpected major restructuring events. Currently, the EGF can only support workers who have already been laid off due to major restructuring. 

The reform would extend support to workers at risk of imminent job loss, allowing earlier intervention. By swiftly mobilising support before collective dismissals and job losses occur, it will prevent larger disruptions and ensure smoother job transitions. The changes will benefit those in sectors undergoing transitions or significant structural changes, particularly in industry.

The proposed amendment will enable workers at risk of imminent job loss to benefit from personalised support at an early stage. This will help them acquire the skills needed to transition into new roles and relaunch their careers. To enable EGF support, companies undergoing restructuring will have to request it to the relevant Member State. Companies will have to pay a part of the assistance offered to workers.

The Commission also proposes to streamline and accelerate the procedures to mobilise EGF support, ensuring it is quickly available where it is needed the most.

In addition, while Parliament and Council must currently review and approve each support request under the EGF individually, they would instead approve the EGF budget once per year, with the Commission allocating this funding to Member States based on their requests. 

Since 2007, the EGF has intervened in 182 cases, allocating €700 million to provide help to more than 170,000 people in 20 Member States. Recent data from Eurofound show that large-scale restructuring events typically last over a year, with the most extensive cases taking nearly three years. 

The proposed amendment is a flagship initiative of the Action Plan for the European automotive sector and the Action Plan for the European steel and metals industry, and aligns with the objectives of the Union of Skills and the European Competitiveness Compass.