EU aid for redundancies in the Belgian province of Hainaut

EU aid for redundancies in the Belgian province of Hainaut 

• Caterpillar and five suppliers hit by decline in EU-28 exports, increased steel prices and high production costs, in particular compared to China 
• EU funds to cover measures such as start-up grants, training and allowances

2,287 workers made redundant by Caterpillar Solar in Gosselies and five suppliers are set to receive EU aid worth €4,621,616 to help find new jobs.

Due to major structural changes in world trade patterns, in particular globalisation and worldwide competition in the construction and mining machinery sectors, Caterpillar shut down its plant in the town of Gosselies (Hainaut province, Wallonia) last year.

The fall in mining sector production in Europe, the dramatic decline in EU-28 exports since 2014, the increase in the European steel prices and the resulting high production costs for machines, have led to a reduction in the workforce in the course of 2017, says the draft report. In total 2,287 workers, the majority of whom are between 30 and 54 years of age, were laid off and should now benefit from measures co-funded by the European Globalisation Adjustment Fund (EGF) and the Belgian authorities.

This is Belgium’s second application for EGF aid concerning Caterpillar. EU assistance was granted to 1,399 redundant Caterpillar workers in 2014. The current proposal covers the remaining workers following the closure of all Caterpillar’s activities in Belgium. The dismissals occurred in the Hainaut region, which has a high unemployment rate. The job seekers in Charleroi are mostly low-skilled (50.6% without an upper secondary education) and 40% are long-term unemployed, says the text.

The EGF aid will cover 60% of the total cost, which amounts to €7.7 million. Five types of measures are planned. These cover job-search assistance, vocational training, entrepreneurship, start-up grants, and allowances. 300 young people not in employment, education or training (NEETs) will also benefit from the services provided.

The draft report by rapporteur Eider Gardiazabal Rubial (S&D, ES) recommending that Parliament approve  the aid was passed by the Budgets Committee on Tuesday by 27 votes to 2, with no abstentions.

Next steps

To take effect, the aid has to be approved by a plenary vote in Parliament, scheduled for 3 May, and by the Council, scheduled for 14 May.

Background

The European Globalisation Adjustment Fund contributes to packages of tailor-made services to help redundant workers find new jobs. Its annual ceiling is €150 million.