People’s Europe and the role of NGOs in the future?

Article
Riitta Särkelä
Ph.D. Soc.Sc, Executive Director, The Federation of Mother and Child Homes and Shelters

Online publication Future of Europe
© SOSTE Finnish Federation for Social Affairs and Health, February 2019

I examine the significance of the European Union for Finnish NGOs from the start of the membership to this day and ponder on the future options. I review the actions of the Finnish government between 1990 and 2010 and the shift of paradigm toward a service market which took place in the middle of the period. Finally, I look at potential ways of deviating from established market behaviour and redress the relationship between single market rights and fundamental rights.

Challenges of shared competence

Because of the shared competence of the European Union, the EU and its member states have been perceived to have their separate social policies. The EU social policy has consisted of the coordination of the social protection of the mobile workers. (Kari 2002.) Strengthening the social dimension of the EU has not been possible by strengthening the judicial actions, as many member states, Finland included, have objected to the project. The impact of each individual amendment regarding the social policy competence in the Treaties of the Union has remained modest. The social policy competence of the member states has been well protected. (Saari 2003.) The social policies of the European Union have meant networking, participation in EU programmes and sharing of experience (Särkelä 2016).

It was long held that the EU would not have an impact on the Finnish way of organising and funding its social protection system. Until the early years of the 2000s, it was thought that social policies are a matter of national competence. Thereafter, social protection has been rarely spoken of as a purely national issue. It has been recognised that in other policy areas, such as economic, employment and single market policies, the decisions made have great significance for national social policy leeway and decisions. (op. cit.)

At the same time that the member states safeguard their own social protection systems, the European Union is faced with major common challenges which have relevance for all member states (COM(2017) 206, 27 April 2017). There are 116 million people living in poverty in Europe (COM(2018) 130 final). Recently, the European Pillar of Social Rights has become a principal issue of discussion between the Commission and the heads of government in the member states. (Cf. COM(2017) 206, 27 April 2017; COM(2018) 130 final; Eurobarometer 2017.)

Finland as model student of single market and change in position of NGOs

The examination below is based on my doctoral dissertation NGOs: from public partnership to market squeeze. The change of NGOs as social services providers within the field of social services during 1990­2010 (Särkelä 2016), unless otherwise stated.

The social and health NGOs are significant in developing and producing social services in Finland. Many of the social services that the municipalities are responsible for have been developed by NGOs. The NGOs and the municipalities have had a common interest in responding to people’s need for assistance by a close partnership. There has been a change of paradigm in the relationship between the municipalities and NGOs. In the 1990s, they were based on the idea of mutual benefit. This broke down in the 2000s and changed into a procurement relationship, when the NGOs begun to be associated to companies. This shift in paradigm was connected to the building of the service markets, which was caused by national choices unrelated to the NGOs. The regulation in the European Union has boosted this development. Despite an atmosphere favourable to the NGOs, the change has occurred due to national decisions and by national choice.

There has been a shift in paradigm in the relationship between the municipalities and the NGOs: in the 1990s they were based on the idea of mutual benefit, but in the 2000s it became a procurement relationship.

The key factors in the shift of position of the social and health NGOs have been the creation of the service market, the application of market logic to public administration and decentralised decision-making. The change began in Aho’s government (from 1991 to 1995) during the recession. In the first national Procurement Act of early 1990s, social and healthcare services were not excluded. The aim was a service market and a stronger position for companies. When the Procurement Act was partially revised, it was not possible to totally rule out social and healthcare services due to the earlier national decision. Mainly thresholds and means to secure the special nature of the social and healthcare services were under discussion. The risks brought about by tendering the services of children, the aged and the handicapped or the position of the NGOs in social services was insufficiently provided for. During its EU membership, Finland has been pro-active in developing the single market and the service market, and hence one of the model students of the EU.

With the national application of the Procurement Directives, social and healthcare services became a commodity. Price became the key factor to the detriment of quality. Companies overtook the NGOs in the production of social services. In some sectors of social services, e.g. families with children and the handicapped, the NGOs still maintain a key position. The production of social services is also concentrating to big companies. This interpretation is also supported by the investigations of the Ministry of Economic Affairs and Employment on the developments in the service market.

All the governments active between 1990 and 2010 continued the strengthening of competitiveness and the markets. The governments of Lipponen (from 1995 to 2003) put more emphasis on the primacy of public services, public responsibility and the supplementary role of other than public service providers. Lipponen’s second government also proposed an amendment of the TFEU: social policy impacts should also be taken into consideration in the decisions of other policies. However, Finland was not able to push through its initiative. In the positions of the following governments, the primacy of the markets has been emphasised in relation to public services. This shows particularly clearly in the proposals of Sipilä’s government (from 2015 to 2019) relating to the reform of social and healthcare services, particularly the regulation of the freedom of choice. The change is significant, and stresses the importance of the market at the expense of public services, which will have a major impact on the Finnish social protection model.

The governments of Lipponen put more emphasis on the primacy of public services and public responsibility and an amendment of the TFEU was also proposed: social policy impacts should also be taken into consideration in decisions of other policies. The initiative was not successful.

Following 2010, the shift in the position of the social and health NGOs has continued, even accelerated. It shows e.g. in the investigations of the Ministry of Economic Affairs and Employment on the social and healthcare sector: there is a major shift toward the dominance of big, international producers. The development is totally contradictory to the goal of a multi-provider model, where the purpose was to maintain the position of various producers, NGOs and small entrepreneurs included, in the field.

On future choices and need for new mechanisms

The White Paper on the Future of Europe raises five different future scenarios. Firstly, it is possible to carry on as before, and EU­27 will implement and develop the current reform programme. Problems are tackled when they appear, and new legislation is enacted when necessary. Secondly, the development of the single market may be given priority more strongly than before. The third option is increasing coordination between the member states that are willing to cooperate. The member states would agree on arrangements to deepen the cooperation and others could join in later. Fourthly, a decision may be taken to do less but to do it more effectively. This would mean that EU­27 would focus attention and resources on chosen areas of policy, and actions in other areas would cease or be cut down. In the fifth scenario, much more would be done together: the member states would share power, resources and decision-making more than before in all matters. Citizens would then have more rights based directly on the Union law, and the eurozone would coordinate public economy, social affairs and taxation more closely than before. (COM(2017) 2025, 1 March 2017.)

Deciding on the future direction is a political issue. The EU elections will indicate the path. It is unsustainable for people if the European Union has such a strong position in the single market and such weak competence in social policy issues. The EU permeates the region of social policy through single market regulation. National social and healthcare policy goals are repeatedly left behind when the single market is developed. It would be wise to prudently expand the competence of the Union in social policy issues to obtain a better balance between fundamental social rights and single market freedoms. (Cf. Särkelä 2016.)

It is unsustainable for people if the European Union has such a strong position in the single market and suck weak competence in social policy issues. A better balance between fundamental social rights and single market freedoms is urgently needed.

What is the meaning of ratified international human rights agreements and the European Social Charter in relation to the development of the single market rights, or do they mean anything? The Finnish NGOs representing the disabled drew up a citizens’ initiative in 2017 titled ”Not for sale”. The initiative objects tendering in the organisation of necessary, life-long services to the disabled. It suggests that tendering the necessary assistance and support is against the UN Convention on the Rights on Persons with Disabilities which Finland ratified in 2016. The initiative demands that these services shall be excluded from the field of application of the Procurement Act. (Not for Sale citizens’ initiative 2017.)

The same issue is very relevant in child protective services. Finland has ratified the Convention on the Rights of the Child, and it requires that the child’s best interests shall be put above all in all actions concerning children. It is not in the child’s best interests that when the child has been taken into custody and placed outside family home, the price of the service obtained by the child is the key factor in determining the service provider. The child has no influence on the decision-making, the placement may change due to tendering and there is no continuity in the human relationships that are important to the child. Which takes precedence, the rights of the disabled and children or single market freedoms? For now, clearly the single market freedoms, even though the EU Charter of Fundamental Rights is legally binding.

Is there a way band ick from the regulation of the single market by national decisions? That would be required by the ”Not for Sale” citizens’ initiative, because Finland has included social and healthcare services within the sphere of the procurement law and single market regulations without limitations. The question will be even more important in the future when we rectify the errors of the social and healthcare reform. Is it possible to exclude established activities from the markets? The situation causes grave concern.

In the unofficial discussions conducted with the Commission, the view has arisen that a mechanism enabling a change of course is lacking from the field of services. It is therefore necessary that during its Presidency, Finland would raise the relationship of single market freedoms and fundamental human rights as a key issue in the development of the EU from peoples´point of view in the future. We would also need mechanisms to make a better balance between these two. Finland should be active at EU level in promoting the development of these mechanisms and in finding support for it from other member states.

Sources

  • COM(2017) 206, 27 April 2017): Reflection Paper on the Social Dimension of Europe.
  • COM(2018) 130 final.): Communication from the Commission to the European Parliament, the Council and the European Economic and Social Committee on Monitoring the Implementation of the European Pillar of Social Rights.
  • Not for Sale Citizens’ Initiative (2017)
  • (COM(2017) 2025, 1. maaliskuuta 2017.) Reflections and Scenarios: EU-27 by 2025.
  • Eurobarometer 2017 https://ec.europa.eu/commfrontoffice/publicopinion/index.cfm/Survey/getSurve- yDetail/instruments/SPECIAL/surveyKy/2179
  • Press Release of the European Council on the Istanbul Convention, 11 May 2017.
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This is an article of the online publication Future of Europe.
© SOSTE Finnish Federation for Social Affairs and Health, February 2019