1 Pillar 1 study Financing Models Brussels, April AFT-IFTIM

What is at stake ? Labour market fluctuations No entitlement to work No CPC 2 Compulsory training generates costs. Without funding, training costs are seen as a burden while it must be viewed as an investment in human capital. Review of funding mechanisms involved or not all stakeholders

Initial qualification average costs in Europe in option test only Member States 3 The costs indicated refer to fees (training selling prices) applied to candidates without funding. Comparison among Member States is not appropriate due to differences in living standards

Initial qualification costs in Member States with compulsory training and test option The costs indicated refer to training selling prices applied to candidates without funding. The huge differences could be explained by differences in living standards. 4

5 Funding of initial qualification Initial qualification could be obtained with traditional vocational schemes (apprenticeships). Within the compulsory training and test option brought by the Directive, public funding exists in some Member States: –Luxemburg: as agreed before transposition of the Directive, the State covers the costs. –In Finland, France, Spain, …employment policies have set up financing mechanisms aiming to bear the costs of the initial qualification for job seekers. But, as reflected by questionnaires collected, in a few Member States, the driver has to pay for her/his initial qualification: Romania, the Czech Republic, Poland, ….

Periodic training costs in Europe 6 Periodic training average tariffs (without financing mechanisms) range from an average of 70 € in Romania to 1000 € in Luxemburg. Comparison is not appropriate due to differences in living standards.

A dichotomy in funding practices of vocational training in Europe (1/2) A broad variety of situations co-exists in Europe: the State, the companies and/or the drivers contribute to finance the periodic training. In Member States that have a long tradition in vocational training involving also social partners: –Funding mechanisms of vocational training existed before implementation of Directive 2003/59, mechanisms in which compulsory training have naturally found their places; –Denmark, the Netherlands, Spain, France, … 7

A dichotomy in funding practices of vocational training in Europe (2/2) In Member States where vocational training systems are under development, funding are based on the driver and/or the company: in Estonia and Romania (and eastern Member States), in most cases, the driver bears the cost but it happens that the company and the driver share it under conditions Other States have set up specific mechanisms resulting from the consultation : in Luxemburg, periodic training costs are shared between the State (1/3) and the company (2/3) 8

The funding of initial vocational training in France Training is financed by the companies, the regions and the State. Companies contribute for 0,5% (taxe d’apprentissage) of the company’s gross total payroll (total wage and salary cost) to a fund for professional training. The contribution depends on the number of employees in the company. 9

The funding of periodic training in France All employers contribute to a fund for professional training (periodic training). The contribution depending on the number of employees is calculated on the basis of the company’s gross total payroll. 10

The funding of drivers compulsory training in France This tax is levied when issuing vehicle's registrations. The tax is based on the category of the vehicle. The proceeds of the tax are used for the development of the qualifications and for the funding of compulsory training € 127 € 189 € 285 €

The funding of training in Belgium The Fonds Social Transport et Logistique contributes to the drivers’ training within the collective agreement (CCT). It supports training costs of the workers reported to the ONSS. To obtain a C driving license, for example, the contribution of the FSTL could go up to 700 EUR. For the basic training in driving school and legal examinations for the driving license Cat. EC: maximum 950 EUR. For the Certificate of Professional Competence Group C: maximum EUR 500. These amounts are cumulative. 12

The funding of training in Belgium The Fonds Social Transport et Logistique provides an annual training budget for each company within the collective agreement for workers reported to the ONSS (CCT). The company can benefit from funds from the FSTL for its drivers training if its training plan has been approved by the FSTL before attending the training. To obtain a C driving license, for example, the contribution of the FSTL could go up to 700 EUR. For the basic training in driving school and legal examinations for the driving license Cat. EC: maximum 950 EUR. For the Certificate of Professional Competence Group C: maximum EUR 500. These amounts are cumulative. 13

The funding of vocational training in Denmark Initial qualification can be obtained through 2 ways : -3-year apprenticeship: free of charges for apprentices who are paid during the contract period from public funds; -AMU program (Adult vocational training): the participant pays app. 80 Euros per week, the rest is financed by the state from the 8% labor tax, plus funding deriving from compulsory payments from the companies (the AER-payments). AMU financing is based on a tripartite procedure (State, employer and trade-unions): contributions are paid into an Employer-Trainee- Fund (AER) jointly administered by the employers and the trade- unions. The fixed tax collected by State represents around 350€/employee/year. 14

The costs of drivers compulsory training in Denmark Initial training People without further education than a vocational training: 472 € Compensation for lost salary € People with further education than a vocational training: 3923 € No compensation for lost salary Periodic training People without further education than a vocational training: 79 € Compensation for lost salary 409 € People with further education than vocational training: 654 €No compensation for lost salary 15

Financing model in Spain: the key role of the Tripartite Foundation for Employment and Training The Tripartite Foundation is responsible for public policies related to employment and vocational training. It involves: –representatives of autonomous communities; –workers representatives; –Employers representatives. the Tripartite Foundation administers the system for allowances for training demand by companies and the justification process for the allowances; 16

Spain - Tripartite foundation funds Tripartite foundation funds that are fed by a contribution of 0.7% collected through the social security system (company 0,6%, employee 0,1%) are the most requested financial means: 60% of collected funds finance job training for the unemployed and 40% is dedicated to continuous training. Training for Employment aims at retraining unemployed workers and continuing training for the employee 17 Tripartite Foundation Employers 0,6% Employees 0,1% Traning for employment

Financing model in Spain Initial qualification through compulsory training and test benefits from Tripartite foundation funds and is also free for trainees that have to pay the administrative taxes (19€) related to the exams and the issue of the CPC license (33€). Periodic training for employees could also benefit from Tripartite Foundation funds if training plans elaborated together by workers’ representatives and employers representatives have been approved. Companies could deduct the total cost of training from its following monthly Social Security payment, in a certain limit. 18