EP debate 18 Feb 09

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European Parliament debate - Brussels plenary session, 18-19 February 2009

A social economy "would reduce speculation in financial markets"

Businesses which focus on people rather than capital play an essential role in the European economy and could help regulate financial markets, says the European Parliament's Committee on Employment and Social Affairs. But, the Committee warns, this "social economy" sector "remains little-known and is often the target of criticism stemming from misguided technical approaches".

MEPs of the Committee point out that an economic system in which social economy enterprises play a more significant role would "reduce exposure to speculation in financial markets on which some private companies are not subject to the supervision of shareholders and regulatory bodies".

They also stress that the social economy helps to "rectify three major labour market imbalances: unemployment, job instability and the social and labour exclusion of the unemployed".

The Committee report, drafted by Patrizia TOIA (ALDE, IT), considers that "social economy enterprises should not be subject to the same application of competition rules as other undertakings" and that "they need a secure legal framework, based on recognition of their specific values".

A lot the Commission could do

MEPs therefore ask the Commission to promote businesses driven by social benefits rather than profit motive in its policies and to introduce "effective legal barriers to entry", so that only social economy organisations are able to benefit from financing destined social economy enterprises.

The report also calls for a European legal framework to be devised by the Commission, enabling "territorial partnerships to be established and maintained between the social economy sector and local authorities", and for the Commission to look into "reactivating the budget heading specifically for the social economy".

Member States, together with the Commission, are called on to develop programmes offering financial support, information, advice and training and to simplify the process of establishment, including reducing the initial capital requirements for companies in this sector.

Video: Patrizia Toia presents her report in Parliament: http://www.youtube.com/watch?v=Cg2N8hd83dk