SSGI

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SSGI

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What is a social service of general interest (SSGI)?

The concept of SSGI is not defined in the TFEU or in secondary legislation. The communication Implementing the Community Lisbon programme: Social services of general interest in the European Union (COM(2006) 177 final of 26 Apr 06) identified two main groups of SSGIs in addition to health services proper:

  • statutory and complementary social security schemes, organised in various ways (mutual or occupational organisations), covering the main risks of life, such as those linked to health, ageing, occupational accidents, unemployment, retirement and disability;
  • other essential services provided directly to the person. These services that play a preventive and social cohesion role consist of customised assistance to facilitate social inclusion and safeguard fundamental rights. They comprise:
    • assistance for persons faced by personal challenges or crises (such as debt, unemployment, drug addiction or family breakdown).
    • activities to ensure that the people concerned are able to completely reintegrate into society (rehabilitation, language training for immigrants) and, in particular, return to the labour market (occupational training and reintegration). These services complement and support the role of families in caring for the youngest and oldest members of society in particular.
    • activities to integrate people with long-term health or disability problems.
    • social housing, which provides housing for disadvantaged citizens or socially less advantaged groups. Certain services can obviously include all four of these dimensions.

Moreover, the communication Services of general interest, including social services of general interest: a new European commitment (COM(2007) 725 final of 20 Nov 07) highlighted the objectives and the organisational principles which characterise SSGIs.

As these two communications make clear, SSGIs may be of an economic or non-economic nature, depending on the activity under consideration. The fact that the activity in question is termed 'social' is not of itself enough for it to avoid being regarded as an 'economic activity' within the meaning of the Court's case law. SSGIs that are economic in nature are services of general economic interest (SGEIs).

New guide to help public authorities to provide high quality and efficient services of general interest

A guide published on 28 Jan 11 provides guidance as to how the Member States may finance services of general interest in compliance with State Aid rules. It states clearly that the rules are not about imposing a particular model of the organisation of public services, but about ensuring that the funding provided does not go beyond what is necessary. It answers questions raised by various stakeholders on the entrustment of services of general interest to external providers and on the calculation of the compensation due to these providers.

The new guide addresses, in a user-friendly manner, the definition of important terms such as: service of general interest, general interest and act of entrustment. It explains that public authorities can use public procurement rules and, at the same time, ensure quality, innovation, continuity and comprehensiveness of social services. It also clarifies the conditions under which the provision of social services can be limited to non-profit providers.

Finally, the document provides specific guidance on applying the Internal Market rules, and the Services Directive, to social services. It highlights that this Directive does not prevent Member States from regulating, or from continuing to regulate, social services in order to guarantee their accessibility and quality.

Source: Commission staff working document. Guide to the application of the European Union rules on state aid, public procurement and the internal market to services of general economic interest, and in particular to social services of general interest SEC(2010) 1545 final of 7 Dec 10 at http://ec.europa.eu/social/main.jsp?langId=en&catId=89&newsId=977&furtherNews=yes

3rd forum on SSGIs

A sheaf of useful documents from the 3rd forum on SSGIs, organised by the Belgian EU presidency on 26-27 Oct 2010, are available at: http://www.socialsecurity.fgov.be/eu/en/agenda/26-27_10_10.asp

UK White Paper on Open Public Services

Published on 11 Jul 2011, this includes the role of the social economy: http://www.cabinetoffice.gov.uk/resource-library/open-public-services-white-paper

Social Enterprise Coalition response

Responding to the publication of the Public Service Reform White Paper, Peter Holbrook, Chief Executive of the Social Enterprise Coalition, said:

“We are concerned that the proposed reforms will create an unequal playing field in which social enterprises are unable to compete with large private sector providers for public sector contracts. Social enterprises often do not have the capital or scale required to compete with big private businesses in open markets.
“These reforms must protect our public services, not put them at risk. Without the necessary safeguards, the consequence of these proposals will be that private providers will dominate public sector markets. Taxpayers’ money will flow into profit seeking organisations that exist only to satisfy the needs of their shareholders. Public services must operate for the communities and people they serve, nobody else.

See press release: http://www.socialenterprise.org.uk/press-releases.php/249/reforms-must-protect-public-services-not-put-them-at-risk-says-social-enterprise-coalition