Short-term work schemes: Putting people first

By helping Member States safeguard jobs and preserve their economic structures, the EU can help prevent the COVID-19 outbreak from causing long-lasting economic and social damage, explains Nicolas Schmit

Photo credit: Adobe Stock

By Nicolas Schmit

27 Apr 2020


The Coronavirus outbreak is testing Europe in ways that would have been unthinkable only a few months ago. Clearly, the current top priority is the fight against the spread of the virus and the saving of peoples’ lives.

But as most Europeans are in mandatory confinement, the social and economic consequences of the epidemic and of the containment measures are already beginning to be felt severely.

The magnitude of the economic and social shock is no longer in doubt, and appears to be totally unparalleled in the history of the European Union.


RELATED CONTENT


This crisis is unprecedented in terms of its scale, but also in the sense that it affects all EU economies simultaneously. This is why it is in our interest to act together to tackle the crisis, to prepare an exit strategy and design the recovery.

We all must reaffirm our commitment to solidarity both in the way we address this crisis and in how we will rebuild our lives and create the ‘new normal’.

To keep jobs and incomes of people afloat, most EU countries have mobilised reduced-time work schemes.

Such schemes provide income replacement for workers and the self-employed who need to reduce or suspend their work.

“The purpose of SURE is to provide financial assistance to deal with the sudden increases in public expenditure relating to measures adopted to preserve employment”

The European Commission has proposed a mechanism to support employment in times of crisis – the new ‘Support to mitigate Unemployment Risks in an Emergency’ (SURE) scheme.

The purpose of SURE is to provide financial assistance to deal with the sudden increases in public expenditure relating to measures adopted to preserve employment.

Specifically, SURE will provide up to €100bn in loans to support reduced-time work schemes and similar measures being taken by Member States to protect employees and the self-employed from the risk of unemployment and loss of income.

I am happy that European economic and finance Ministers recently found a way forward on SURE.

Now we need to make sure that the SURE instrument is adopted swiftly and that the guarantees from Member States are secured quickly, as we are keen to start disbursing the first loans as soon as possible.

“We need to make sure that the SURE instrument is adopted swiftly, and that the guarantees from Member States are secured quickly, as we are keen to start disbursing the first loans as soon as possible”

By helping Member States safeguard jobs and preserve their economic structures, the EU can help prevent the COVID-19 outbreak from causing long-lasting economic and social damage and establish the basis for a swift and broad-based recovery.

However, we must bear in mind that the new instrument is a temporary one; its duration and scope are limited to tackling the consequences of the Coronavirus pandemic.

Thus, this scheme does not preclude establishing a future permanent unemployment reinsurance scheme.

The latest economic crisis has again confirmed the importance of European social dialogue, as well as the relevance of social partner initiatives tailored to the realities of companies and sectors.

It was encouraging to witness that in some countries, as a response to the COVID-19 crisis, social pacts were reached in record time.

I am a strong believer that the role of social partners is crucial as we develop our exit and recovery strategies, which the European Commission is currently working on.

To work, these strategies need to put people first, enhance the European social model and respect the principle of solidarity.

It is the question of our future as well as that of the EU. We have often been served the ‘Europe at a crossroad’ idea. Today, its sense is as acute as ever.