EU commission launches new plan to tackle recession

The EU has offered its member states €19bn to combat a surge in unemployment amid the ongoing credit crisis.

On the eve of the European elections on Wednesday, the commission said it proposed to set aside €19bn to create new jobs, upgrade worker skills and increase access to employment throughout the EU.

Under the plan, the executive will earmark the cash from its funds to finance job-creation projects undertaken by member countries without the need for national co-funding.

The commission said that the European Social Fund expenditure will "support people hit by the economic crisis".

Usually, the EU requires member countries getting social funds to match these with money from their own funds. However José Manuel Barroso, the commission president, said that the recession was so severe that the EU would forgo the rule.

He said the funds would "help people to stay in work or move towards new jobs, through upgrading skills, encouraging entrepreneurship and improving public employment services".

There are also plans to spend €100m on a new EU microcredit facility to encourage entrepreneurship and keep small businesses afloat.

Unemployment is the number one concern at present, said Barroso at a news conference.

Of chief concern are young people just entering the workforce, he said. The new programme promises at least five million apprenticeships and proposes that unemployed youth receive training or work within one or two months of losing their jobs.

"The commission is taking further steps to save and create jobs," he said.

EU employment commissioner Vladimir Špidla said, "The crisis started in the financial sector but its effects are being felt by everyone."

He said the package was a "strong, forward-looking and coordinated" agenda to fight joblessness and boost job creation.

However, the pan-European Party of European Socialists, campaigning ahead of the European elections starting on Thursday, criticised the plan and other commission proposals aimed at cutting unemployment.

"If your house is on fire it is no good trying to put out the flames with a glass of water," PES president Poul Nyrup Rasmussen said. "Micro-credit is unlikely to have macro results in a hurry."

"This is a weak, conservative commission proposing a weak, conservative answer to the deepest social crisis for decades," he said in a statement.

The commission will ask heads of governments to sign up to the proposals when they meet in Brussels for a summit on June 18-19.

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