EU Member States (Social Affairs Council) adopted a Recommendation on a “Fair transition towards climate neutrality”. The objective is to ensure that the transition of the EU towards a climate-neutral and environmentally sustainable economy is fair and inclusive. The Recommendation reflects the awareness that climate policies need to be socially just, against a background of growing precariousness due to the pandemic and the inflation provoked by the invasion of Ukraine.
We need to change our economic model as quickly as possible to limit global warming. The good news is that climate policies can contribute to reducing poverty and inequality if they are designed with this objective in mind. Climate Action Network (CAN) Europe recently issued concrete proposals in order to maximize the positive social outcomes of policies on decarbonising the buildings sector, ensuring cleaner transport, and expanding renewable energy. In the last weeks, we have been witnessing within the negotiations of the Fit for 55 files the great potential of climate and energy policies to address inequalities and injustices and to support the people who are most exposed to the economic and social impacts of climate change as well as of the transition. Unfortunately though, we saw no bold steps forward so far when it comes to concrete policy decisions and again the interests of big polluters prevailed. In last week’s tragic EU Emissions Trading System (ETS) plenary vote, conservative members of the European Parliament watered down the phase out of free pollution permits to industry so much that the entire reform was rejected and sent back to the drawing board. It means that these polluting industries will continue being resourced billions worth of tax breaks (free ETS allowances that they don’t have to pay). These lost revenues could instead have supported low-income households in the green transition, job creation in social and green sectors, or research and innovation to help heavy industry to effectively embark on a green transition.
The light in the tunnel is the expected adoption of a Social Climate Fund, which should provide Member States with resources for direct income support to low-income households who can’t afford their energy bill, going together with support measures to renovate their houses and shift to renewable energy to heat their homes, and towards cleaner transport modes. While not being perfect, this new EU fund, if the European Parliament votes for it on 22 June and the Council adopts it on 28 June, is a good start and shows that climate action can be socially just. But climate action cannot be a substitute for transformative social policies. Social and climate policies need to be much better coordinated in order to deliver a just and green transformation of our economies and societies. This is what the Recommendation adopted today by the Council is seeking to achieve.
It encourages national governments to adopt measures to support people who will be most affected by the green transition – in the field of education and life-long training; social protection; access to essential services; shift to renewable energy and renovation of homes. Member States are encouraged to support sustainable consumption and sharing schemes to promote social enterprises in regions facing transition challenges, and to reform taxation so that it is fairer and greener. Member States are requested to pay attention to the distributional impacts of policies with a gender lens, to involve trade unions and civil society in decision-making processes – including by using new participatory models involving people in vulnerable situations. There is also a demand for Member States to ensure complementarity between EU and national funds to serve a green and just transition.
The Recommendation adopted today is a welcomed starting point. However, if our governments across Europe really want the wealthiest people to bear the cost of the transition, they need to do more than adopting a Recommendation. They need to strengthen – and not erode – public services such as health and education; they need to tax wealth, financial transactions and large companies, notably those operating in the digital sector. They need to regulate to protect trade unions and the right to collective bargaining. They need to protect the right to housing and introduce a minimum income for all. And they need to resource grassroots civil society organisations, which play a vital role in modern participatory democracies.
A Council Recommendation is not legally binding, but it is a political commitment. Will our governments walk the talk? The future will tell us. Ultimately, it is just a question of political will.