Commission: social protection systems in EU must be modernised to encourage employment

The Commission has set out the improvements in incentive measures needed for the EU to achieve its objective of a 70 per cent employment rate by 2010.

As requested by the European Council in March 2003, the Commission issued a Communication assessing the improvement in the overall framework of social protection policies in the EU, identifying best practice and giving recommendations on these points.

The Commission's Communication addresses the challenge of promoting work incentives while maintaining a high level of social protection for all and keeping costs down. This is the tough balancing the EU is striving to strike in order to achieve its ambitious objective to increase the overall employment rate to 70 per cent by 2010.

The Commission recommends that Member States should make their social protection systems more employment-friendly by removing barriers and disincentives to work and by encouraging mobility. Increasing the levels of participation in employment is crucial given the growing problem of ageing populations and the threat this poses to the financial and social sustainability of social protection systems.

There are financial and non-financial factors which play a role in a person's decision to accept a job. Financial incentives include wages, taxes and benefits. Non-financial benefits include care services for children, job search assistance, training and health care, etc. The Commission suggests that Member States should focus on all forms of incentives that have proved effective in the past.

The Communication will be on the agenda of the informal gathering of employment ministers in Galway (Ireland) on 16-17 January.

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