Political groups welcome emergency unemployment scheme

Written by Martin Banks on 3 April 2020 in News
News

Two of Parliament’s biggest political groups have welcomed the Commission’s new scheme, which aims to support workers and avoid massive unemployment caused by the COVID-19 outbreak.

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The scheme, called SURE, was launched on Thursday by the executive’s President Ursula von der Leyen.

SURE, or “Unemployment Risks in an Emergency”, will provide up to €100 billion in loans to countries. All Member States will be able to make use of the new funding but it will be of particular importance to the hardest-hit.

Firms, says the Commission, will be able to temporarily reduce the hours of employees or suspend work altogether with income support provided by the state for the hours not worked.


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Von der Leyen said the proposal takes the EU’s response to the ongoing crisis “to a new level.”

The scheme was generally welcomed by political groups but Iratxe García Pérez, leader of the S&D, Parliament's second biggest group, added a note of caution, saying, “We expect more and I am sure it will come.”

She noted that Von der Leyen had “committed herself” to introducing an EU unemployment reinsurance scheme when Parliament approved her Commission college, adding, “so this loan to support workers should now be the basis for a more ambitious plan, for a real scheme.”

“We expect all EU countries to commit to this instrument to make enough funds available to create a meaningful protective shield for workers” Iratxe García Pérez, S&D Group leader

Garcia said her group will study the details of SURE, especially the ‘implementation agreement’.

“We must ensure that no conditionality will be applied to countries that will access these loans. We also expect all EU countries to commit to this instrument to make enough funds available to create a meaningful protective shield for workers.”

Elsewhere, Renew Europe said SURE will avoid workers being sacked and minimise job losses if Member States run out of the means to provide such guarantees themselves.

Luis Garicano, RE deputy leader and group coordinator on the economic and monetary affairs committee, said, “We have been calling for the creation of a European scheme to support national employment protection programmes.”

Garicano, also from Spain, added, "SURE will contribute to cover a portion of the wages that each worker has to forgo as a direct result of coronavirus. This is what’s been announced and we welcome the proposal.”

But he warned, “The EU urgently needs to take action, before there is a greater sense in Spain, and especially Italy, of a lack of European solidarity amongst the public.”

“SURE will contribute to cover a portion of the wages that each worker has to forgo as a direct result of Coronavirus. This is what’s been announced and we welcome the proposal” Luis Garicano, Renew Europe deputy leader

“By launching this programme, the EU shows that we will fight this virus together and with solidarity. The EU shows that the Italian and Spanish workers, who are enduring this crisis, are not alone.”

The Commission said SURE aims to cushion the economic blow of the crisis so that the EU economy “will be ready to restart.”

“To achieve this,” said a spokesman, “we must keep people in employment and businesses running.”

The €100 billion in loans will allow people to “continue to pay their rent, bills and food shopping and help provide much-needed stability to the economy.”

The loans will be based on "guarantees" provided by Member States. The self-employed will receive “income replacement” during the emergency.

In addition to SURE, the Commission also announced that €3 billion will be put into the EU’s “Emergency Support Instrument” of which €300 million will be allocated to RescEU to support the stockpile of medical equipment.

It also said on Thursday that all “uncommitted money” from the three Cohesion Policy funds – the European Regional Development Fund, the European Social Fund and the Cohesion Fund - will be “mobilised” to address the effects of the crisis.

The executive said it will also shortly unveil a range of measures to ensure that farmers and “other beneficiaries” can get support from the Common Agricultural Policy.

Von der Leyen, speaking via a video link at the launch of SURE, said the EU “has not faced a health crisis in its history on this scale or spreading at this speed” and that €100 billion will “keep people in jobs and businesses running.”

Meanwhile, Parliament's President David Sassoli, speaking ahead of a key meeting on Friday of the European Investment Bank, has called for a "courageous response" from the banking sector to the crisis.

The EIB recently announced measures that will help mobilise up to €40 billion to help SMEs impacted, but Sassoli said, “Although this is important we expect a courageous response from the EIB to mitigate the effects of this crisis.”

He said the EIB, the European institutions, national promotional banks, commercial banks and governments had to provide emergency assistance to sectors and business hit hardest by the crisis.

About the author

Martin Banks is a senior reporter at The Parliament Magazine

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