EGF assistance for crisis-stricken companies and workers

2010-01-10



The Ministry of Regional Development is about to invite applications for financial aid under the European Globalisation Adjustment Fund (EGF). The Fund, set up almost a year ago, has since been modified to increase availability of support for companies forced to make deep job cuts in response to the worldwide economic crisis.
As part of the changes, Brussels relaxed eligibility criteria for receiving support by lowering the minimum number of affected jobs to 500 (over the nine preceding months) from the initial 1,000. Furthermore, there is a new eligibility option based on the number of jobs lost, not only at the applying company itself but across its supplier network (at least 500 jobs over the past four months). Moreover, the maximum level of EU support (as a share of total cost of a programme) was raised as well.
The changes have been welcomed by the Polish Confederation of Private Employers (PKPP) Lewiatan. In its opinion, the amended EGF can be an important tool for cushioning the economic and social impact of mass redundancies caused by the financial and economic crisis. At the same time, however, the confederation warned that some of EGF's other eligibility criteria, namely those tying aid to certain developments in a company’s business environment, could deny access to the instrument for Polish companies from sectors such as shipbuilding, automotive, or clothing. These criteria mention changing global trade patterns that lead to serious economic disturbances, in particular a sharp rise in imports to the EU or a sharp decline in the EU’s market share in a given sector, or relocation of economic activities to third countries.
The EGF funds active labour market measures to help workers made redundant as a result of globalisation. They include job-search assistance, re-training, job-search and mobility allowances, or lifelong learning activities. It has an annual budget of €500m.