1. Social Services of General Interest
The 2007 Communication on SGI and SSGI and its accompanying documents
Concetta Cultrera
European Commission
Employment, Social Affairs & Equal Opportunities DG
28-Feb-19
Directorate-General for Employment, Social Affairs and Equal Opportunities

2. The 2006 consultation process
SPC questionnaire
Study on SSGI
Legal Expert Group
At this stage, no need to change the rules, rather to explain them better!
28-Feb-19
Directorate-General for Employment, Social Affairs and Equal Opportunities

3. 2007 Communication
The 2007 Communication acknowledges the difficulties in understanding and applying Community rules experienced in the social field →
it expresses the Commission’s commitment to provide explanations about the rules applicable (enhance legal certainty).
28-Feb-19
Directorate-General for Employment, Social Affairs and Equal Opportunities

4. How does the Communication increase legal certainty?
First, it provides a series of clarifications of the legal framework that applies to SSGI.
Second, it puts in place the necessary tools to give concrete guidance on practical questions that are regularly raised by citizens, public authorities and service providers:
two Q&A documents on State Aid and Public Procurement, focused on SSGI
an interactive information service
28-Feb-19
Directorate-General for Employment, Social Affairs and Equal Opportunities

5. 2007 Communication – the IIS
Interactive Information Service (IIS)
ISS to address questions by citizens, public authorities and service providers “with a view to providing guidance on the pertinent Community law rules concerned”
Pilot in EN, FR, DE – then in all official languages
28-Feb-19
Directorate-General for Employment, Social Affairs and Equal Opportunities

6. 2007 Communication – the IIS
Questions can be sent to the Commission by filling out a mail form (name/country/organisation/question)
no analysis of the facts of an individual case or provide a formal interpretation of Community law in relation to a specific situation - no advice on how to structure calls for tender, contracts or on how to organise compensation mechanism
no legal advice on issues of national law
28-Feb-19
Directorate-General for Employment, Social Affairs and Equal Opportunities

7. Q&A document on public procurement
2007 Communication
Q&A document on public procurement
A public authority has full discretion to decide whether it provides services itself or entrust them to a third party (question 1.1).
Applicable legal framework is flexible in the area of social service - only a few provisions of Public Procurement Directive 2004/18/EC apply! - It is possible to define quality criteria. (questions 2.1 and 2.2)
Public procurement rules do not limit the number of service providers selected (question 2.5)
28-Feb-19
Directorate-General for Employment, Social Affairs and Equal Opportunities

8. Q&A document on public procurement
2007 Communication
Q&A document on public procurement
certain requirements related to the knowledge of the local context might be acceptable! Must be justified by the particularities of the service and strictly related to the performance of the contract (question 2.6).
under certain – very strict – circumstances, public authorities may limit the participation in tender procedures for the provision of social services only to non-profit providers (question 2.7).
Interaction PP and State Aid rules: when purely financing an activity – and not "buying" a service – public authorities will have to comply with State aid rules but not with public procurement rules (question 2.11).
Local context:
• A public authority may, for instance, require that the successful tenderer
establishes a local infrastructure such as an office or a workshop or deploys
specific equipment at the place of performance if this is necessary for the
provision of the service.
• A municipal authority intending to put in place a shelter for women in
difficulty, mainly addressed to women from a specific cultural minority, may
specify in the call for tenders that the service provider should already have
the experience of this kind of services in an environment presenting similar
social and economic characteristics and that the employees who will be in
contact with and/or address the needs of the women in difficulty should be
sufficiently familiar with the relevant cultural and linguistic context.
• A public authority that intends to put in place a job placement service
focused in particular on young adults from disadvantaged areas and
addressing in an integrated way the specific difficulties encountered by the
users (e.g. mental health problems, alcohol or drug addictions, social housing
and indebtedness) might specify that the service provider should have
experience with this kind of services for similar target groups. It may also
indicate that the service provider should ensure that as of the beginning of
service provision the employees dealing with the users have a knowledge of
the already existing networks of social actors with whom they will need to
liaise in order to address
Non-profit
a national law regulating a particular activity might, in exceptional
cases, provide for a restricted access to certain services for the benefit of nonprofit
organizations. In this case public authorities would be authorized to limit
participation in a tender procedure to such non-profit organizations, if the law is
in conformity with European law. Nevertheless, such a national law would
constitute a restriction to Articles 43 and 49 of the EC Treaty, on the freedom of
establishment and the free movement of services and would have to be justified
on a case by case basis. On the basis of the case-law of the Court of justice, such
a restriction could be justified, in particular, if it is necessary and proportionate
in view of the attainment of certain social objectives pursued by the national
social welfare system.
28-Feb-19
Directorate-General for Employment, Social Affairs and Equal Opportunities

9. Q&A document on State Aid
2007 Communication
Q&A document on State Aid
Concrete examples of activities that have been considered as non-economic (question 2.4), or not affecting trade between Member States (question 2.10), and therefore not subject to competition rules;
What does it mean when an activity is subject to competition rules? It does not mean that public authorities have:
to ensure that a multiplicity of operators operate on the market
to privatize public entities,
to abolish existing special or exclusive rights that are necessary and proportionate for the provision of the service (question 2.11)
28-Feb-19
Directorate-General for Employment, Social Affairs and Equal Opportunities

10. Q&A document on State Aid
2007 Communication
Q&A document on State Aid
Explains under which conditions public financing to service providers will not to be considered as State aid or will benefit from an exemption of the notification requirement (question 3.3).
Examples show that these requirements are rather basic; special focus on two important conditions:
act of entrustment: can take various forms/are compatible with the autonomy enjoyed by service providers;
a priori definition of parameters of costs: no obligation to provide detailed calculation in advance, but only to determine the basis for the future compensation
Act of entrustment: It is the official act which entrusts the company to carry out the
SGEI, spells out the mission of general interest of the undertaking concerned, as well
as the scope and the general conditions of the functioning of the SGEI/SSGI.
Examples of acts of entrustment:
• Concession contract and tender documents.
• Ministerial program contracts
• Ministerial instructions
• Laws.
• Yearly or pluriannual performance contracts
• Legislative decrees and any kind of regulatory and municipality acts and
decisions.
Basic nature of the requirements
In both cases, the examples given show that these requirements are rather basic. Acts of entrustment can take different forms (see reply to question 5.2) and are perfectly compatible with the autonomy and freedom of initiative enjoyed by many providers in the social field (see reply to question 5.6). In particular, when public authorities approve and finance a proposal made by a service provide, one possibility could be that public authorities quote in their decision the terms of the proposal made by the service provider (i.e.: the definition of the SGEI mission; the parameters for cost compensation the safeguards to avoid over compensation). The proposal made by the service provider may then be annexed to the decision of the public authority and referred to for more details. As for the establishment of parameters of costs (see reply to question 6.1), there is no obligation to provide detailed calculation in advance but simply to determine the basis for the future compensation, so as to ensure a minimum of transparency (e.g. it might be sufficient to specify that the costs will be compensated on the basis of a price per day based on an estimation of the number of potential users).
28-Feb-19
Directorate-General for Employment, Social Affairs and Equal Opportunities

11. Q&A document on State Aid - (questions 3.8 & 6.11)
2007 Communication
Q&A document on State Aid - (questions 3.8 & 6.11)
No judgment of the efficiency of the service provider
Public authority to define the extent of the mission
If non measurable tasks do generate costs (e.g. time spent with the people), these costs can be compensated.
28-Feb-19
Directorate-General for Employment, Social Affairs and Equal Opportunities

12. Q&A document on State Aid – example (question 5.4)
2007 Communication
Q&A document on State Aid – example (question 5.4)
A public authority wants to set up a shelter for women in need.
it would be sufficient to specify in the act of entrustment that
the SSGI provider is entrusted with the mission to set up a shelter which will provide the necessary assistance to women in need,
taking into account the multiplicity of these needs, in particular where necessary at the medical, psychological and social level (for example housing problems, failures in families etc.).
28-Feb-19
Directorate-General for Employment, Social Affairs and Equal Opportunities

13. Q&A document on State Aid – example (question 6.1)
2007 Communication
Q&A document on State Aid – example (question 6.1)
A public authority wants to set up a shelter for women in need.
Parameters for cost compensation could be:
the number of women and children accommodated in the shelter over a one year period;
the number of days spent in the shelter during this period.
28-Feb-19
Directorate-General for Employment, Social Affairs and Equal Opportunities

14. Regular updating of the FAQ documents
2007 Communication
Next steps:
Interactive information service will ensure that questions from public authorities, service providers and users are answered
Regular updating of the FAQ documents
State aid Package to be evaluated in
28-Feb-19
Directorate-General for Employment, Social Affairs and Equal Opportunities

15. Clarifications brought by the Communication
Underlines the role of the Protocol on SGI annexed to the Lisbon Treaty
increased political visibility;
highlights responsiblity of MSs as far as the scope and nature of SGEI are concerned - acknowledges the diversity of these services;
reminds that the single market framework only applies to economic services.
New article 14
Clearer distinction between economic SGI and non-economic SGI
Protocol on services of general interest
The Inter-governmental conference meeting in Lisbon in October 2007 agreed to annex the following
Protocol to the Treaty of Lisbon:
"The High Contracting Parties,
Wishing to emphasise the importance of services of general interest,
Have agreed upon the following interpretative provisions, which shall be annexed to the Treaty on
European Union and to the Treaty on the Functioning of the Union:
Article 1
The shared values of the Union in respect of services of general economic interest within the meaning
of Article 14 Treaty on the Functioning of the European Union include in particular:
- the essential role and the wide discretion of national, regional and local authorities in providing,
commissioning and organising services of general economic interest as closely as possible to the
needs of the users;
- the diversity between various services of general economic interest and the differences in the needs
and preferences of users that may result from different geographical, social or cultural situations;
- a high level of quality, safety and affordability, equal treatment and the promotion of universal
access and of user rights.
Article 2
The provisions of the Treaties do not affect in any way the competence of Member States to provide,
commission and organise non-economic services of general interest".
28-Feb-19
Directorate-General for Employment, Social Affairs and Equal Opportunities

16. Exclusive rights remain possible!
2007 Communication
Clarifications brought by the Communication
Article 86 (2) – sections 2.2. and 2.3 of the Communication:
Exclusive rights remain possible!
measures intended to regulate markets, such as authorisation requirements
special focus on social services where there is a lack of awareness - importance of acts of entrustments.
Article 86 (2) ECT
In the case of public undertakings and undertakings to which Member States grant
special or exclusive rights, Member States shall neither enact nor maintain in force any
measure contrary to the rules contained in this Treaty, in particular to those rules provided
for in Article 12 and Articles 81 to 89.
2. Undertakings entrusted with the operation of services of general economic interest or
having the character of a revenue-producing monopoly shall be subject to the rules
contained in this Treaty, in particular to the rules on competition, in so far as the
application of such rules does not obstruct the performance, in law or in fact, of the
particular tasks assigned to them. The development of trade must not be affected to such an
extent as would be contrary to the interests of the Community.
3. The Commission shall ensure the application of the provisions of this Article and shall,
where necessary, address appropriate directives or decisions to Member States.
28-Feb-19
Directorate-General for Employment, Social Affairs and Equal Opportunities

17. Clarifications brought by the Communication
Importance of existing State Aid legislation: services performed at local level generally exempted from notification requirements!
Announces clarification initiatives in the area of PPPs and concessions.
28-Feb-19
Directorate-General for Employment, Social Affairs and Equal Opportunities

18. What is the added value of the 2007 Communication?
It emphasizes the importance of social services for the fulfilment of EU objectives:
it lists a number of specific objectives that social services are often meant to achieve;
it explains how these objectives are reflected into principles expressing how social services can be organised, delivered and financed.
Building on the consultation process, a step forward in recognising the specificities of SSGI & enhancing mutual understanding!
28-Feb-19
Directorate-General for Employment, Social Affairs and Equal Opportunities

19. Examples of specific objectives (section 2.3. of the Communication):
SSGI are person-oriented services, designed to respond to vital human needs in particular the needs of users in vulnerable position; they assist in personal challenges and crisis, they are provided to families in a a context of changing family patterns but also
services which play a preventive and socially cohesive role and are adressed to the whole popultation, indepentendly of wealth or income;
services which contribute to ensuring equal opportunities for all (non-discrimination, gender equality, etc)
28-Feb-19
Directorate-General for Employment, Social Affairs and Equal Opportunities

20. 2007 Communication
Examples of principles of organisation (section 2.3. of the Communication):
these services must answer to mutliple needs. They should be conceived and delivered in an integrated manner;
the relationship between providers and beneficiaries is often asymmetric (vulnerable users);
the particularities of local situations often need to be taken into account (proximity between the service providers and users);
28-Feb-19
Directorate-General for Employment, Social Affairs and Equal Opportunities

21. 2007 Communication
Examples of principles of organisation (section 2.3. of the Communication):
importance of the autonomy of service providers;
services often driven by the principle of solidarity and highly dependent on public funding
important role of non-profit service providers and voluntary workers
Objectives + principles of organistation = important step towards recognising the specificities of these services
28-Feb-19
Directorate-General for Employment, Social Affairs and Equal Opportunities

22. A strategy to promote SSGI quality
2007 Communication
A strategy to promote SSGI quality
Need to develop mechanisms for the definition, measurement and assessment of SSGI quality
Why?
essential to facilitate the choice of services/service providers by the users, to increase their autonomy, to protect vulnerable users
useful for public authorities when outsourcing a service
28-Feb-19
Directorate-General for Employment, Social Affairs and Equal Opportunities

23. A strategy to promote SSGI quality – next steps
2007 Communication
A strategy to promote SSGI quality – next steps
developing, within the Social Protection Committee, a voluntary EU quality framework (principles, criteria, methodology)
supporting, through the PROGRESS programme, cross-European bottom-up initiatives aimed at developing voluntary mechanisms for the definition, measurement and assessment of SSGI quality
supporting the creation of a network of Local Observatories to monitor and promote best practices in the field of SSGI
promoting the training of public authorities in the field of public procurement
28-Feb-19
Directorate-General for Employment, Social Affairs and Equal Opportunities

24. Where to find the documents?
2007 Communication
Where to find the documents?
DG EMPL:
SG:
DG COMP
DG MARKT
28-Feb-19
Directorate-General for Employment, Social Affairs and Equal Opportunities

25. Questions? 2007 Communication 28-Feb-19
Directorate-General for Employment, Social Affairs and Equal Opportunities