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Social policy will be key to EU's green transition | View

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By Sharan Burrow and Luca Visentini
Opinions expressed in View articles are solely those of the authors.

Europe's ambitious climate-protection commitments promise economic and political shifts reminiscent of the Industrial Revolution two centuries ago, highlighting a need for social policy to take centre stage.

The European Union's "Green Deal" is a barometer of the global actions required to slash greenhouse-gas emissions and counter the increasingly frequent -- and increasingly damaging -- heatwaves, storms and floods resulting from climate change.

This makes the 27-nation EU a test case of the ability of countries around the world to marry the necessary switch away from fossil fuels, and toward renewable energy sources, with jobs and social justice, particularly for the most vulnerable segments of the population.

As it pushes ahead with plans to become climate-neutral by mid-century and to spur the rest of the world to follow suit, the EU is in a position to show how social policy can help foster political consensus in times of fundamental economic change.

A prime example lies in the European Commission's recent package of draft EU legislation meant to achieve a big step on the way to climate neutrality in 2050: a 55 per cent cut in the bloc's greenhouse-gas emissions in 2030 from 1990 levels (rather than just a previously agreed 40 per cent reduction).

The package includes a controversial proposal to establish a distinct European emissions-trading system for buildings and road transport. Such a regime would set an initial overall emissions cap for the two sectors, force polluters to acquire a permit for each tonne of carbon dioxide they release and, crucially, steadily shrink the annual supply of those permits.

This would be a new European tool to help EU countries meet their varying 2030 targets for slashing discharges from sectors outside the bloc's main emissions-trading system, or ETS, which covers power plants, factories and intra-EU aviation.

Unlike the existing ETS, the parallel European system for buildings and road transport would have a direct impact on consumers. It threatens to drive up fuel costs for households and road drivers.

The idea is producing unusual political bedfellows as EU governments and the European Parliament hold deliberations as part of the approval process.

Some Green campaigners are keen on the emission cuts guaranteed by the proposal and, as a result, find themselves aligned with conservative forces traditionally in favour of market-based policies.

At the same time, many right-of-centre voices have joined a chorus of left-wing critics of the proposal who warn it could worsen “energy poverty” in Europe and provoke a continent-wide popular revolt similar to the “yellow-vest” movement in France in 2018.

What unites all the voices is a desire to address the social implications of cleaning up buildings and road transport.

With more than 30 million Europeans already unable to afford adequate home heating, and amid sharp energy-price increases prompted by a natural gas squeeze, the EU is going to need just this kind of alignment of political views on social matters to keep the Green Deal on track.

Widen the lens, and it emerges that social considerations increasingly feature in EU policymaking involving the economy and climate protection.

Take the EU's 18-month-old system for classifying climate-friendly business activities, a regime known as 'taxonomy' meant to drive more investments toward sustainable projects.

While the subject has recently grabbed headlines over whether the bloc will label gas, a fossil fuel, as a green investment of sorts, the Brussels-based Commission has quietly been weighing an expansion of the European classification system to include social taxonomy.

Given that social matters in the EU have traditionally been regulated at national level, this Commission exercise is noteworthy. It shows the inextricable link between social investment and sustainable development.

A genuinely fair transition, especially for workers, also requires fully fledged European industrial and energy strategies. These need to go beyond training and social compensation; the goal must be the large-scale creation of quality jobs, particularly in regions where employment is now tied to fossil fuels.

Without this evolution in EU thinking, the Green Deal would cause social unrest and the rise of political extremism.

In this context, the EU should also:

  • Map and address the green transition's impact on jobs, industries and regions across Europe;
  • Establish a European framework for ensuring workers' right to information, consultation and co-decision when it comes to transition plans;
  • Create (at the EU and national levels) advisory boards composed of employer, worker and governmental representatives to help design Green Deal and just transition policies.

It is these kinds of people-focused initiatives that must anchor decision-making around the world on climate protection. The result would be to show that, in the age of environmental threats affecting us all, social policy can be the new political unifier rather than an old divider.

Sharan Burrow is general secretary of the International Trade Union Confederation and a vice chair of the European Climate Foundation's supervisory board. Luca Visentini is general secretary of the European Trade Union Confederation