Presentation of the CEB, Development Bank of the Council of Europe.
“The CEB is a multilateral development bank with an exclusively social purpose. By providing technical and financial expertise to socially impactful projects in its member countries, it actively promotes social cohesion and strengthens social integration in Europe. The CEB is a major instrument of solidarity policy in Europe. It participates in the financing of social projects, intervenes in emergency situations, and contributes to improving the quality of life for the most disadvantaged population groups.” (source: Council of Europe).
Ci-dessous, un article rédigé par Sandrine Gaudin, Vice-Gouverneure pour la Stratégie Financière de la CEB, publié dans le numéro 249 (juillet-septembre 2024) dans la revue Allemagne d’aujourd’hui, disponible sur le site de la CEB.
“The social Europe, a progressive deepening throughout the European construction and notably in favor of the crises”
Since 1957, the Treaty of Rome has provided for the creation of the European Social Fund to initially finance the retraining of workers and their mobility between member states, in order to ensure the economic and social progress of Europeans. During the energy crisis of the 1970s, member states adopted a social action plan to regulate corporate restructuring, to protect the health and safety of workers, and to ensure gender equality, a principle that is enshrined among the rights and values protected by the Treaties. However, it was the Delors Commission (1985-1995) that amplified European action in the social field and established the European social dialogue with the Val Duchesse meetings, thus contributing to the formation of European structures for social dialogue..
In the 1980s, the fight against unemployment became a collective priority, and the Single European Act of 1986 paved the way for new tools, notably the European program for aid to the most disadvantaged, which is essential in France for the proper functioning of many charitable organizations, including the Restos du Cœur. The Amsterdam Treaty signed in 1997 dedicates a chapter to employment policy and establishes the principle of a European employment strategy realized through the coordination of national policies, similar to what is provided for in terms of coordination of economic policies. From now on, each national reform program presented annually by all member states to ensure this coordination must detail the employment policies and social policies developed at the national level..
In 2017, a social summit bringing together the heads of state or government and European social partners was held in Gothenburg and adopted the European Pillar of Social Rights, which includes 20 social principles that Europe should strive for. In 2021, in Porto, another important social summit adopted three objectives for 2030: at least 78% employment for those aged 20-64; participation in training activities for at least 60% of adults each year; and a minimum of 15 million people at risk of poverty or social exclusion..
The COVID pandemic in 2020 provided the EU with the opportunity to make a significant leap forward in the pooling of management of the consequences of unemployment, through the SURE common borrowing mechanism, which allows for the financing of job protection measures and short-time work schemes. The Next Generation EU recovery plan, endowed with 750 billion in grants and loans to member states, financed by a common borrowing for the first time, includes an important component for funding measures related to social resilience, social cohesion, and vocational training. History will remember that this federal leap was made to ensure social cohesion during the pandemic..
A comprehensive European regulation to cover a wide variety of areas today
The body of European social regulations is extensive, although most often it consists of texts for minimal harmonization, leaving a very wide latitude to the States in implementation: working time, working conditions, health and safety at work, coordination of social security systems, the posting of workers, accessibility of products and services for people with disabilities...
Under the impetus of the six-monthly presidencies of the EU Council, social Europe progresses when clear priorities are set, which is not always the case. Thus, during the French presidency of the EU Council in the first half of 2022, three major negotiations were concluded: the establishment of minimum wages in Europe, gender equality in boards of directors, and pay transparency. In 2023, the Spanish presidency organized a tripartite summit between the EU and social partners on October 25, 2023, to emphasize that the development of a European industrial policy should be accompanied by a social dimension for the benefit of workers. Similarly, in 2024, the Belgian presidency sought to reconnect with the tradition of meetings at Val Duchesse and held a tripartite summit in La Hulpe on April 15 and 16, 2024. An important declaration on the future of social Europe, referring to the European Pillar of Social Rights, was unanimously adopted except for two states, Sweden and Austria, which believe that strengthening a social Europe could harm their national social model..
Recently, at the end of the European Parliament's term in spring 2024, several social advancements are worth highlighting: the recognition of persons with disabilities, equality of treatment between men and women, the status of workers on digital platforms, and the duty of vigilance imposed on companies to ensure they respect social rights, including in their relationships with their subcontractors outside the EU..
A range of financial instruments with a significant overall amount for a European competence known as support
The EU budget (2020-2027) allocates significant amounts to finance social or vocational training expenditures within the EU. The European Social Fund, one of the oldest instruments, is endowed with 88 billion for seven years, of which 6.7 billion is allocated to France. This must be supplemented by the professional retraining expenditures planned in the new Just Transition Fund and ad hoc funds, such as those related to refugee protection or assistance to the most disadvantaged. In addition to these funds directly aimed at social needs, one must also consider the funds intended for candidate countries for EU entry, the neighborhood policy funds, and the pre-accession funds, all of which include a social component. It is difficult to establish a total amount of EU funding in the social domain, but it can be said that the EU's financial interventions are far from negligible, even though European competence in this area is merely a supporting competence for national policies..
A concurrent and complementary intervention by the financial instrument of the Council of Europe, the CEB
The CEB, which is increasingly cooperating with many international organizations and other international development banks, is one of the natural partners of the EU. Cooperation with the European Commission, which is the main donor of the CEB, continues to intensify. The CEB relies on funding from the Commission to finance technical assistance and provide investment aid for the Bank's projects, notably by combining loans and grants. However, the CEB can also co-finance projects with the European Investment Bank (EIB), whose mandate is more climate-oriented. 25% of the CEB's interventions are made in partnership with the EIB, in the areas of education, local infrastructure, energy efficiency, and local transport..
The CEB now plays an important role in the financial architecture of European development by relying on the range of instruments provided by the EU budget. Since 2000, when the first contractual agreement was concluded, the Commission has contributed a total of 699 million euros, which represents 75% of the total donations received by the CEB. The strong leverage effect, that is to say, the high ratio between EU contributions and the projects supported by these funds, demonstrates the positive impact of the cooperation between the Commission and the CEB. To date, the total value of CEB projects that have benefited from EU donations amounts to 2.9 billion euros..
These funds can be direct (allocated by various directorates-general of the Commission, such as the Directorate-General for Employment or the Directorate-General for Home Affairs or the Directorate-General in charge of Neighborhood) or indirect, meaning they pass through specific mechanisms or regional platforms. The best example is the investment framework for the Western Balkans (WBIF) created in 2008, which allowed the CEB to lead a regional housing program for people displaced during the war in the former Yugoslavia, in connection with the UNHCR, the UN, and the OSCE. Today, nearly 36,000 people have benefited from it for a total amount of 238 million euros, thus financing nearly 11,300 housing units..
In 2016, to help Türkiye meet the needs of Syrian refugees, the Commission created the Facility for Refugees in Türkiye (FriT) and allocated 6 billion euros to it. The CEB manages two projects aimed at improving healthcare for refugees and host communities for a total amount of 140 million..
The CEB also relies on the budget guarantee facilities provided by the Invest EU instrument launched in March 2021 to stimulate sustainable investment, innovation, and employment in Europe, expanding the possibilities of the Juncker Plan. Approximately 3 billion of this 46 billion instrument is directed towards social investments. This guarantee allows the CEB to diversify its beneficiary partners (not only governments or public authorities but also foundations, cooperatives, and associations) and to take more risks, for example, by financing microfinance actors or social and solidarity economy initiatives. With 159 million in EU guarantees, the CEB was able to start a program in 2023 that includes a loan portfolio of 370 million in favor of social housing, training, and microfinance. In total, 740 million euros of investments will be secured in co-financing with the EU. Thus, the CEB granted a loan of 13.5 million euros to the Apprentis d'Auteuil Foundation in France in 2023..
Regarding Ukraine, a candidate country for the EU and a member of the Council of Europe and the CEB, the new European financing instrument for Ukraine was adopted in spring 2024 and amounts to a total of 50 billion euros. The CEB is eligible for pillar 2, which will support private and public investments from development banks in grants (1.5 billion euros) and guarantees (7.8 billion euros), particularly for social, education, housing, or health projects. The use of this new financial facility will amplify the CEB's efforts in favor of Ukraine (to date, 100 million in loans in the health sector, particularly mental health, and 2 million in grants for support of small repairs to damaged housing)..
Many EU policies (climate transition, digital transition, social cohesion, combating homelessness, welcoming migrants and refugees, assistance to candidate countries, support in case of natural disasters, support for resilience and reconstruction of Ukraine ...) resonate with the mandate of the CEB.
The expertise of the CEB is valuable for extending the action of the EU, for contributing to adding value to EU funding, or for intervening in areas where the EU is currently only minimally present, such as social housing financing..
The CEB, even though it targets its funding in a number of member states with the highest development needs (particularly in Central and Southern Europe), operates in all member states of the CEB. Social housing has been one of its priorities for many years. Thus, the CEB financed several social housing programs for low-income individuals in Lower Saxony in 2017 (a loan of 72 million euros to NBank), and in 2019 in Brandenburg to finance social and municipal infrastructure as well as social housing for vulnerable populations, such as migrants and refugees, people with disabilities, the elderly, and families with young children (a loan of 150 million euros to LBBank). In 2024, a loan of 100 million euros from the CEB will support the expansion of services of Berlin's largest municipal housing company, HOWOGE Wohnungsbaugesellschaft mbH, to provide an additional 1,394 affordable and modern social housing units as part of its new construction initiative. In France, the CEB relies on its long-standing cooperation with CDC and particularly ADOMA to contribute to the financing of housing for the most vulnerable..
The announcement by the newly elected President of the Commission, Ms. von der Leyen, on July 18th, to appoint a Commissioner responsible for housing issues is an important new direction for the EU and a new opportunity for cooperation between the EU and the CEB..
As was recalled in Vilnius last June during the celebration of the 25th anniversary of the European Social Charter of the Council of Europe, the role of the CEB is essential to operationalize and realize basic social rights enjoyed by Europeans under the treaties on the European Union or under the European Social Charter of the Council of Europe, such as the right to education, the right to health, the right to housing, and the right to access to clean drinking water..
The social Europe is based on a foundation of unique social rights in the world, effective through collective action. It is indeed the harmonious combination of public policies and national resources, EU financial instruments (Commission and European Investment Bank) and the CEB, as well as the impetus from civil society and social partners that promote social progress in Europe with an ambition and resources unmatched compared to the rest of the world.. »
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