Commissioner Schmit’s letter to Labour Ministers: the social economy is playing a crucial role in the COVID emergency and must be supported

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Nicolas Schmit, Commissioner for Jobs and Social Rights, has sent a letter to Member States’ Labour Ministers urging them to ensure that social economy enterprises and organisations are well equipped and supported, so they can keep playing their crucial role to manage and overcome the COVID-19 crisis.

Economic and social progress are needed to rebuild Europe, and Social Economy Europe welcomes the Commissioner’s attention to the social economy as an inclusive and resilient and social enterprise model based on the values of cooperation, solidarity, responsibility and sustainability: for an economy that works for people and the planet. Social Economy Europe is also happy to see that many of the elements included in SEE’s open letter to EU leaders have been captured by Commissioner Schmit’s letter.

In his letter, the Commissioner stressed how crucial it is to ensure that social economy operators have access to economic relief measures established both by the EU and by Member States to respond to the current crisis – in the same way as other types of companies. No social economy enterprise or organisation should be excluded from support programmes dedicated to enterprises and specifically SMEs.

Schmit highlights EU measures that may be directed to the social economy, emphasising that these instruments can only benefit the social economy if Member States design them appropriately. These measures, many of which are facilitated by the activation of the Stability and Growth Pact’s general escape clause, are as follows:

  • State aids, through the use of the full flexibility in the existing rules;
  • The extension of the scope of the EU Solidarity Fund to health crises;
    Through the two Coronavirus Response Investment initiatives, full flexibility is provided to Member States in how they use their structural funds, notably for measures on healthcare, support SMEs, and short-term work schemes;
  • Through the European Investment Fund, the incentives to bank to provide liquidity to SMEs;
  • The proposal for a European instrument for temporary support to mitigate unemployment risks in an emergency (“SURE”).

Commissioner Schmit commented on how the Commission Action Plan on the Social Economy (planned for 2021) will be playing special attention to the needs and the potential of the social economy in the recovery phase to help it thrive. Supporting the development of social economy ecosystems, at national, regional and local level, he continues, will boost job creation and innovation as well as fostering social inclusion and participation.

SEE President Juan Antonio Pedreño has commented:

“We welcome Commissioner Schmit’s letter to the Member States’ Ministries of Labour and the bold support expressed for the social economy. We call on Member States to ensure that the social economy is included in support measures for enterprises, especially those for SMEs. We encourage dialogue with social economy enterprises and organisations at all levels to ensure their access to instruments designed to overcome the crisis. The future Action Plan for the Social Economy will be key to boosting the development of enabling ecosystems for the social economy to thrive. It is clear that we need to build Europe’s tomorrow based on solidarity, sustainability and social progressThe social economy is ready to contribute to the EU’s recovery, offering an alternative entrepreneurial model able to ensure no one is left behind.”

To facilitate and accelerate the important contribution to overcoming the current public health, economic and social emergency, Schmit highlights the necessity of sharing good practices and identifying the needs of the social economy. The Commission has started doing so through an open source platform and weekly online sessions gathering the experience of social economy enterprises and organisations. Similar activities are being conducted at global level through the United Nations Task Force on the Social and Solidarity Economy, available here .

Read Commissioner Schmit’s letter here. For a PDF version, SEE has transcribed the letter here.

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