305 5. Domestic Adaptation to the ‘Policy ID’ of the EES: Policy Transfer and Diffusion Leading to ?-Convergence in the UK and Germany? Taking up the assumptions of the second guiding thesis (cf. chapter 2.3.2), the present chapter tests, whether the EES–by means of policy learning, transfer and diffusion–exerted an Europeanisation impact on the domestic employment policies and instruments of the UK and Germany. It analyses, whether the soft elements of the EES stimulated learning processes as well as the development of common understandings, perceptions, and ideas on employment policy-making. If the assumptions of the second guiding thesis proved to be true, adaptation of domestic employment policy styles, logics, instruments, and problem-solving approaches were to be witnessed as a result of the EES. British and German employment policies showed signs of adaptation to the general ‘policy ID’ of the EES (cf. chapter 3.2.2) and increased proximity not only to the European model–resulting in ?-convergence–but also in a cross-national perspective–leading to ?-convergence (increasing policy similarity)–as also domestic cognitive/normative structures proved to be open to change (cf. chapter 2.1.2.3.1 and chapter 2.3.2). The country-specific sub-chapters on the UK and Germany are again subdivided into two chapters, examining new domestic policy approaches presented in the NAPs, the recommendations and the JER. The sub-chapters, moreover, take into consideration domestic priorities for employment policy-making as outlined in the government’s declarations for the respective year. They highlight important policies and innovations introduced and referred to under the different EGs, present the recommendations issued to the two EU member states, analyse the countries’ responses to the recommendations in the NAPs and examine policy evaluation by the supranational institutions as outlined in the JER. Given that the analytical focus of this particular sub-chapter lays on the Europeanisation impact and on policy convergence, it will neither take the concrete implementation of policies into closer consideration, nor analyse the outcome of the policies adopted at national level (cf. chapter 1.1). The first part of the country-specific sub-chapters analyses British and German employment policies and their development under the ‘stand-alone’ EES (1997/98- 2002). The second part is dedicated to the examination of national policy developments under the streamlined, synchronised, and welded EES (2003-2005) (cf. chapter 3.2.3.3 and 3.2.3.4). Due to the extended three-year cycle and the adapted, simplified and more result-oriented character of the EES, the second period will be taken into account separately in order to draw conclusions on the distinct Europeanisation impact of the EES during these two periods. National Adaptation to the ‘Policy ID’ of the EES 306 5.1 British Employment Policies under the EES: Deviating from Beveridge, Thatcherite De-regulation, and Blatcherism while ‘Building Up’ Domestic Employment Policies? The British labour market underwent major changes already during the Heath and the Thatcher era (cf. chapter 2.2.2.1). Changing the post-war storyline of Keynesian policy-mix that targeted at full employment and caused a substantial expansion of the welfare state also in terms of costs, de-regulation, de-centralisation, and flexibilisation became key elements of reforms (cf. Heise 1999/2000:35). In the light of rising unemployment during the 1970s and 1980s, these reforms aimed at increasing adaptability of the labour market and employability of the British workforce. Hoisted the ‘TINA’-flag of Thatcherite neo-liberalism, socio-economic and employment policies became subordinated to supply-side and monetary policies. They aimed at stabilising the business cycle, reducing state interventionism and weakening industrial relations that means they also targeted at debilitating the strong position of trade unions (cf. ibid.; chapter 2.2.2.1). In this period, the overall focus of employment policies shifted towards training and qualification programmes, especially aiming at problematic groups such as women, youth, and long-term unemployed. They were, moreover, accompanied by several tax reforms to free the forces of the market and to increase the efficiency of industry. With these reforms, the British labour market, already during the 1980s, aligned with elements of the ‘policy ID’ of the latter EES (cf. chapter 3.2.2). They equipped the British employment policy armoury with activation measures at the expense of passive labour market instruments, but partially also at the expense of the quality of jobs and the number of full-time jobs. While the economic development under these reforms was favourable, the low-paid sector as well as wage differentiation increased as did the gap between the employability of highly and low qualified persons. Given this neoliberal reform approach to labour market and employment policy especially under the Thatcher government, the UK became one of the most de-regulated, decentralised and flexible labour markets in Europe. With the challenges of de-industrialisation and related re-construction during the 1980s and 1990s particularly in the north of the country, the British labour market was broadly left to take care of itself (Bertozzi/Bonoli 2002:5; cf. chapter 2.2.2.1). Moreover, no comprehensive, proactive approach to employment policy was developed to counterbalance industrial re-construction and, in line with Beveridge traditions, unemployment benefits were kept low in order to increase the willingness to take up work even in the low-paid sector (cf. Bertozzi/Bonoli 2002:6). National Adaptation to the ‘Policy ID’ of the EES 307 5.1.1 The ‘Stand-Alone’ EES (1997/98-2002): Autonomous Europeanisation Power and Embeddedness of the EES’s ‘Policy ID’ into British Traditions? New Labour, while not returning to a pre-Thatcherite Keynesian policy-mix, yet opted for a “right balance between economic efficiency and social inclusion” (HM Treasury 1997:3), instigating a societal transformation of the shareholder paradigm into that of a stakeholder society. As outlined in the 1997 Queen’s Speech, education of young people, the promotion of lifelong learning at the workplace, the fight against youth and long-term unemployment, business legislation and the improvement of competitiveness formed priorities of the incoming New Labour government for the years 1997 and 1998 (cf. Her Majesty Queen Elizabeth II 1997). Hence, at the dawn of the inception of the EES, British employment policies–introducing ‘Blatcherism’–embraced the ‘Third Way’ approach of New Labour embedded in the New Deal (ND) and Welfare-to-Work programmes. With these reforms, the promotion of employability to transform the UK into a knowledge-based and -driven society became even more important to fight unemployment than under previous governments (cf. HM Treasury 1997:3). In parallel, the strong focus on strict budgetary policies of low spending and borrowing in order to fight inflation and preserve monetary stability remained untouched. As outlined in the 1997 ground-breaking UK Employment Action Plan (cf. ibid.)– formulated in October as an input into the November 1997 Luxembourg Jobs Summit and taking up the government’s ‘Getting Europe Back to Work’ initiative even before the official launch of the annual NAP procedure under the EES (cf. chapter 3.1.2.2) as well as expressing the hope that other member states may agree to produce such annual plans–British socio-economic and employment policies broadly focused on five priority areas (cf. HM Treasury 1997:4): (1) Promotion of economic growth and stability: The strict macro-economic policies of the Thatcher government were continued to promote currency stability, sound public finances, economic growth, and job creation. New policies aimed at guaranteeing low inflation, a favourable ‘golden rule’steered fiscal environment–that is, borrowing only to invest and not to fund present expenditure–and at the increase of investment in new technologies, skills, and the industry. Additionally, a five-year deficit reduction plan was introduced with the July 1997 Budget to maintain sound public finances (cf. HM Treasury 1997:5ff.). (2) Investing in human capital: New Labour especially focused on the increase of participation rates in post-compulsory education. It aimed to reduce the number of early school-leavers and to increase basic qualification, such as basic literacy and numeric skills. The introduction of new approaches, presented with the July 1997 White Paper ‘Excellence in Schools’, and the extension of existing training and qualification programmes targeted especially at post-16 education and at employees in SMEs. They also included ‘lifelong learning’ programmes (cf. ibid.:7ff.). National Adaptation to the ‘Policy ID’ of the EES 308 (3) Helping people from welfare into work: A comprehensive reform programme was announced to facilitate the transition from ‘Welfare-to-Work’. It should include the ND programmes in order to (re-)integrate youth, longterm unemployed, lone parents, and other disadvantaged groups into the labour market. (Re-)Integration was to be achieved by the improvement of work skills, the balance of rights and responsibilities attached to unemployment benefit and the engagement of the business community. In parallel, a wide-ranging review of the tax and benefit system targeted at increasing the willingness to take up work and the reduction of non-wage labour costs (cf. ibid.:11ff.). (4) Improving the workings of markets: In order to improve product markets’ regulation, legislative reforms were envisaged to toughen competition policies, to align national and EU regulations and to improve the latter, to promote the activation approach easing mobility and employability of the work force, to review the pension system and to support the completion as well as simplification of the Single Market. At the same time, SMEs were especially to be targeted by reforms (cf. ibid.:16ff.). (5) Creating a fair and inclusive society: The political priority of setting up a cohesive society included “the right to decent minimum standards of fair treatment at work” (ibid.:24), the introduction of a National Minimum Wage (NMW), the promotion of social partnership, the signature of the European Social Chapter and the implementation of the Working Time Directive (cf. ibid.:24ff.). In order to improve national employment records in the medium-term, the 1997 Employment Action Plan underlined the relevance of a co-operative approach within Europe given that member states alone would “not succeed in .. [their] task if … [they tried] to improve one without the other” (ibid.:3f.). The document, furthermore, highlighted the relevance the British government attached to an European answer to tackle unemployment and proposed “the ratio of the working population to total population, the level of long-term unemployment [and] the rate of youth unemployment” (ibid.:4) as quantitative indicators to measure the impact of domestic employment policies. As the main instrument to put forward British domestic employment policy reforms, the ND programme was set up already before the establishment of the EES. Later on it functioned as the UK’s main response to the adaptation requirements of the EES. With these reforms of the Blair government, the British labour market over the late 1990s served as a model for many other EU member states. In terms of employment and unemployment rates it still does so today. National Adaptation to the ‘Policy ID’ of the EES 309 5.1.1.1 ‘Building the Base’ in 1997/98: The ‘New Deal’ and the EES – Fraternal Twins See the Light of Day? Tied in with the government’s priorities for 1997 and 1998 (cf. chapter 5.1.1), New Labour had already introduced a wide range of socio-economic and employment policies after coming into office in 1997. Tacking up these reforms, the focus of the first British NAP under the ‘stand-alone’ EES was put “on policies and programmes to get the longer-term unemployed into jobs, to bring those who have lost contact with the labour market into the world of work and to raise the quality of education and training to the level of the most successful economies” (United Kingdom 1998:2). The last aspect was especially promoted by the social partners (cf. ibid.:15). While underlining the role of social partners, the 1998 NAP thematically followed the five domestic priority areas outlined above. It, moreover, extended the strategic policy approach already outlined in the 1997 Employment Action Plan to the following areas that were highlighted as domestic priorities and as the continuation of national policy approaches rather than as responses to the EES: “ • sound macro-economic policies delivering sustainable, non-inflationary growth to provide the stability companies need in order to invest and create jobs; • competitive product markets with effective remedies for abuse of market power, effective enforcement of the Single Market and a progressive reduction in barriers to free trade; • a climate which is conducive to the creation and development of small and medium sized enterprises and allows them to realise their full jobcreating potential[;] • a highly educated, well trained workforce, able to adapt to the new information based technologies of the future; • the creation of a learning society in which people continue to acquire and update knowledge and skills throughout their working lives; • active policies to reconnect to the labour market those excluded through discrimination, deprivation or inadequate educational standards, in particular action to help women returning to the labour market; • targeted help for lone parents, most of whom are women, to gain access to the labour market; • a regulatory framework which provides decent basic standards for those at work while enabling firms to respond flexibly to changing market needs; • the modernisation of the tax and benefit system and the introduction of a minimum wage to ensure that work pays” (ibid.:3). In 1997/98, several ND programmes built the focus of domestic employment policy legislation to bring different disadvantaged groups from welfare back into work. The ND programmes were especially “designed … to provide intensive and substantial National Adaptation to the ‘Policy ID’ of the EES 310 support for those at risk, including the young and long term unemployed, lone parents, people with disabilities and ex-offenders” (ibid.:5). In different subprogrammes they aimed at • young people aged 18-24, who have been unemployed for more than six months (‘New Deal for Young People’, NDYP); • long-term unemployed aged 25+, who have been unemployed for more than 18 months (‘New Deal for Long-Term Unemployed’/’New Deal for People Aged 25+’, ND 25+); • lone parents (‘New Deal for Lone Parents’, NDLP); and • disadvantaged groups and disabled people most vulnerable in the labour market (‘New Deal for Disabled People’, NDDP). Parallel to the activation paradigm of the EES (cf. chapter 3.2.2), these programmes underlined the British government’s determination “to move away from a passive dependency on welfare towards an active system where everyone who is able to work has the opportunity to do so” (United Kingdom 1998:5) and is supported to do so as of day one of unemployment (cf. ibid.:8). After its launch in 12 pathfinder areas in January 1998, the NDYP was introduced on a nation-wide base in April 1998. It focuses especially on the enhancement of “the labour market attachment of young people by improving work skills and disciplines and helping them to find and stay in work” (HM Treasury 1997:13). It serves to bring young unemployed people aged 18 to 24 back into work and–complying with the EES’s idea of early intervention–becomes operational after six months of unemployment. It includes an up to four months period of personal advice, guidance, and counselling (‘New Deal Gateway’). Activation measures, co-financed by the ESF, include full-time qualification and training measures for up to 12 months, public funding for employers to subsidies training cost, temporary subsidised employment and the option of temporary voluntary/non-subsidised work in non-profit organisations or an environmental task force (cf. HM Treasury 1997:13f.; United Kingdom 1998:9f.). The payment of unemployment benefit is coupled with the acceptance of active integration into the labour market, balancing rights and responsibilities of the unemployed. The ND 25+ was introduced in June 1998. It comprises measures to help longterm unemployed over 25 years of age–those unemployed for more than 18 months– to return to work. It includes a so-called advisory period, an intensive activity period, and a follow-through period. Similar to the NDYP, its instruments contain temporary subsidised employment, the opportunity for 10,000 people to choose an up to one year full-time study period as well as a three month intensive training and work experience programmes. Not in line with the EES’s early intervention period of 12 months, the ND 25+ focuses on persons unemployed for over 18 months, even if intervention at 12 months is also envisaged within pilot projects under the programmes (cf. United Kingdom 1998:10f.). The choice for regular intervention at 18 months was backed by the experience that regularly unemployed move out of unem- National Adaptation to the ‘Policy ID’ of the EES 311 ployment before this period. Support is also offered by “providing funding to help the partners of unemployed people, who are themselves out of work, to get jobs. Childless partners under 25 will be included in the ND for Young People. Partners over 25 will be offered the advice and help they need to get back to work” (cf. ibid.:11). The NDLP was established as a voluntary programme in October 1998 to assist “lone parents with their youngest child in the second term of full time school” (HM Treasury 1997:14) to move into paid work and generally improve their employability as well as willingness to work by offering income support. Measures include “jobsearch, training and reskilling” (ibid.) “to help and encourage lone parents on Income Support to improve their prospects and living standards by taking up paid work or increasing participation in existing part-time work” (United Kingdom 1998:39). The NDDP was set up in December 1997 and extended nation-wide in October 2001. On a voluntary base, it tries to help individuals on incapacity benefits to move into sustainable employment by the assistance of personal advisers, a special research and evaluation programme as well as an information campaign (cf. ibid.:41). The 1986 ‘Job Seekers Allowance’ (JSA; cf. chapter 2.2.2.1) was renewed in 1998. With this renewal, aimed at removing “the distinction between passive and active assistance to unemployed people” (ibid.:12), unemployment benefit is restricted to unemployed participating in active labour market instruments. Such instruments are a job search plan, a New Jobseekers Interview, jobcentre visits every two weeks and further interview series after 13 weeks and six months, work trails, job search trainings or training activities. The JSA forms the key activation instruments of British employment policy apart from the NDs. Particularly supported by the social partners (cf. ibid.:15), the ‘University for Industry’ (UfI), tax free ‘Individual Learning Accounts’ (ILA) “to encourage people to plan for, and invest in, their own learning” (United Kingdom 1999:17) and the ‘Investors in People’ (IiP) programme, targeting at SMEs, were planned to develop the domestic lifelong learning approach. These instruments aim at improving employees’ skills and SME’s business performance by encouraging training activities (cf. United Kingdom 1998:16). Additionally, the ‘Investing in Young People’ (IiYP) programme–to ensure coherence of the previously rather fragmented domestic lifelong learning approach, which was also highlighted as a future priority (cf. HM Treasury 1997:9; United Kingdom 1998:5)–was introduced as a new instrument. It was especially supported by the social partners to develop a ‘Modern Apprenticeship’ system (cf. United Kingdom 1998:15) in order to reduce the number of early school-leavers. It aims at guaranteeing that 16 to 18 year olds remain in some kind of learning activity to “ensure that all young people reach 16 with the highest standards of basic skills and a secure foundation for lifelong learning” (HM Treasury 1997:7). Its instruments include the annual publication of pupils’ performance targets by schools, increase of work-related training for 14 to 17 year olds, ‘National Traineeships’, ‘Modern Apprenticeships’ and the increase of training quality (cf. United Kingdom 1998:18). Additionally ‘Career Development Loans’ offer National Adaptation to the ‘Policy ID’ of the EES 312 individuals borrowings for vocational training and ‘Small Firms Training Loans’ comprise borrowings for SMEs to finance training activities. They were introduced to remove barriers for in-house training (cf. ibid.:33). Several policies were adopted already in 1998 to reduce costs and burdens on labour and to facilitate self-employment. Such initiatives included a corporate tax rate cut to 20 pp (operational since April 1999) and instruments such as • the ‘Business Link’, comprising “local business support services to provide easy access to quality advice and support” (ibid.:21); • the internet-based ‘Enterprise Zone’ as “a ‘one-stop’ site for small businesses, helping them to find quickly and effectively the right, authoritative business related information on the world wide web” (ibid.:22); • a ‘Joint Education Programme’, involving “site visits by officials to explain tax administration and business responsibilities” (ibid.); • the improvement of the land-use planning system targeting at long-term economic growth in urban areas (cf. ibid.); and • a package of measures promoting British exports (cf. ibid.). Ten ‘Territorial Employment Pacts’ were proposed to enhance economic growth and job creation at regional and local level (cf. ibid.:25) and to respond to the regional dimension of the EES. Embedded in the envisaged tax and benefit reforms to create “an active benefit system” (ibid.:8), the ‘Working Family Tax Credit’ (WFTC) was introduced to become operational in October 1999. It aims at easing the transition from welfare to work for unemployed parents and to assist families with children by providing “a guaranteed minimum income for working families [and by raising] .. the earnings threshold at which many low-paid families begin to pay tax” (ibid.:28; cf. Hodson 2004:304). The WFTC was the starting point for the modernisation of the British tax and benefit system. It was flanked by a reform of the National Insurance Contributions (NIC) to “abolish NICs liability for employers of workers earning less than £81 per week (up from £64 currently), removing employers’ NICs liabilities entirely in respect of 1 million low paid workers; … [and] ensure that employer and employees NICs become chargeable, at a flat rate, only on wages in excess of that threshold” (ibid.). It became operational as of April 1999. The WFTC, including a ‘Childcare Tax Credit’ (CTC), was introduced to make work pay for families with children, reduce child poverty, and support women to re-enter work. Furthermore and interlinked with the need to tackle the gender gap, the ‘National Childcare Strategy’ was introduced. As the main instrument to balance parents’ working and family life with the increase of out-of-school childcare facilities to “match the provision of childcare with the labour market” (ibid.:37). In view of monitoring the enhancement of equal opportunities, the special ‘Women’s Unit’, established in 1997, was placed under the Cabinet office. It aims at supporting gender mainstreaming of policy formation and –making and “plays a leading role in the articulation of women’s National Adaptation to the ‘Policy ID’ of the EES 313 perspectives in the design, delivery and evaluation of policy initiatives” (United Kingdom 1999:Executive Summary and 41, 2000:6). The 1998 JER drew a rather positive conclusion on the 1998 British NAP and the policy reforms introduced. It assessed the employment performance of the country to be favourable compared to other EU member states. It especially emphasised the EES’s activation approach to be visible in the UK. Particularly with the ND programmes, the JSA, initiatives in the entrepreneurship area and the WFTC, the UK would be equipped to tackle some of the previous shortcomings. Yet, even if assessed positively, the ND programmes were also viewed to not precisely provide for an answer to the preventive approach of the EES. Specification of means for goal attainment were, thus, requested to be presented in the 1999 NAP (cf. Council of the EU/European Commission 1998:113). Table 27: Main British Socio-Economic and Employment Policies and Innovations introduced in 1997/98 Policy / Initiative Targeting at Thematically linked to the EES’s … pillar Classed under EG89 New Deal for Young People, NDYP Youth Employability 1 New Deal for long-term unemployed/New Deal for People Aged 25+, ND 25+ Long-term unemployed Employability 2 Job Seekers Allowance Unemployed Employability 3 University for Industry, UfI Employees, Employers, SME Employability, Lifelong Learning 5 Individual Learning Accounts Employees, Employers, SME Employability, Adaptability, Lifelong Learning 5, 15 Investors in People, IiP Employees, Employers, SME Employability, Lifelong Learning 5 Investing in Young People, IiYP Youth Employability, Lifelong Learning 6, 7 Business Link Business start-up, SME Entrepreneurship, Employability, Lifelong Learning 8 Enterprise Zone Self-employed, SME Entrepreneurship, Employability, Lifelong Learning 8 Joint Education Programme New businesses Entrepreneurship, Employability, Lifelong Learning 8 89 For the contents of the EG generally cf. chapter 3.2.2 and table 51. National Adaptation to the ‘Policy ID’ of the EES 314 Policy / Initiative Targeting at Thematically linked to the EES’s … pillar Classed under EG89 Working Family Tax Credit, WFTC Childcare Tax Credit, CTC Unemployed, Families, Women, Low-paid sector Employability, Equal Opportunities 11, 17 Career Development Loans Employees, Employers, SME Adaptability, Employability, Lifelong Learning 15 Small Firms Training Loans Employees, Employers, SME Adaptability, Employability, Lifelong Learning 15 National Childcare Strategy Families, Women Equal Opportunities, Employability 17 New Deal for Lone Parents, NDLP Lone parents Equal Opportunities, Employability 18 New Deal for Disabled People, NDDP Disabled people Equal Opportunities, Employability 19 Source: Own compilation based on chapter 5.1.1.1 and 3.2.2. With the coming into office of New Labour, the quasi ‘explosion’ of socio-economic and employment policy reforms laid the strategic focus of British policies and the 1998 NAP on four broad priority areas, in which change and adaptation was assessed to be most critical: • reduction of long-term unemployment and focus on disadvantaged groups, including public co-funding of activation and training measures; • support for families and enhancement of childcare facilities, including tax reforms in order to create incentives to take up work; • investment in human resources by increase in quality of education, including the availability of public co-funding for training periods and courses; • creation of a business- and employment-friendly economic environment, including tax system reforms as incentives for job creation. The 1997/98 socio-economic policy focus and the 1998 NAP were, thus, very close to the heart of the EES (cf. chapter 3.2.2). Both explicitly related employment and labour market policy reforms back to macro-economic policies, performance and reforms as well as sound public finances as most important background variables for employment growth (cf. chapter 2.2.2.3). The macro-economic development and the development of the labour market were, hence, viewed to represent two sides of one coin. Most of the measures adopted under the above four priority areas responded to the EES’s employability pillar, highlighting the UK’s broad understanding of the activation approach (cf. Council of the EU/Commission 1998:114). New instru- National Adaptation to the ‘Policy ID’ of the EES 315 ments related to the other pillars were, yet, not neglected either. The particular British understanding of activation not only embraced the coupling of benefit payments and active labour market instruments. It, moreover, set great store by providing advice, guidance, and counselling to bring unemployed back into work. The ND programmes, building the base of new British employment policies, were in line with the EES’s activation approach, creating a dense network of active policy instruments and coupling benefit payments with activation. At the same time they followed domestic needs and traditions, such as a relatively low level of state interventionism into industrial relations. As a consequence of this early development, the fraternal twins ND and EES followed in large parts the same underlying ideas, while particularities were still to be discernable inter alia in the Beveridge tradition of lower standard social security safety belts in order to raise incentives to take up work. In view of the Europeanisation impact of the EES at this early stage, a strong parallelism of domestic priorities and the ‘policy ID’ of the EES points at ?-convergence (through parallel developments) and the potential of the British government to successfully up-load its ideas in the first place. This diagnosis, yet, leaves cause for suspicion that the proximity of approaches was predominantly caused by parallel paradigms rather than an exclusive stimulus by the supranational level. 5.1.1.2 Further ‘Constructing the House’ in 1999: The Extension of the New Deals – Tending to All-embrace the Workforce In line with the government’s 1999 policy priorities to enhance long-term economic stability and growth, education and training, support for people with long-term sickness or disabilities and tax reforms related to family taxation (cf. Her Majesty Queen Elizabeth II 1998), the 1999 British NAP outlined the main challenges for domestic employment policy-making of the given year. Among them were most prominently the extension of efforts to face social exclusion and unemployment, the creation of a skilled and adaptable labour force and the move of unemployed from welfare back to work. With these priorities, the 1999 NAP took up the focus of the previous year’s NAP. It followed its predecessor in its strategic approach and heavily drew on the 1998 NAP wording, while targeting at: “ • sound macro-economic policies delivering sustainable, non-inflationary growth to provide the stability businesses need in order to invest and create jobs; • competitive product markets, effective enforcement of the Single Market and a progressive reduction in barriers to free trade; • a climate conducive to the creation and development of small and medium sized enterprises which allows them to realise their full job-creating potential and so help maximise employment in the economy; • a highly educated, well trained workforce, able to adapt to the new infor- National Adaptation to the ‘Policy ID’ of the EES 316 mation based technologies of the future, and the creation of a learning society in which people continue to acquire and update knowledge and skills throughout their working lives; • active policies to help people into work and provide security for those who can’t work, with provision for helping those excluded through discrimination, deprivation or inadequate educational standards; • a regulatory framework which provides decent basic standards for those at work, including health and safety at work, while enabling firms to respond flexibly to changing market needs; • reform of the tax and benefit system and the introduction of a minimum wage to ensure that work pays; • devolution to the Scottish Parliament and the Welsh Assembly, and the creation of business-led Regional Development Agencies in England” (United Kingdom 1999:1). The previous year’s political initiatives to combat unemployment were extended to the regional level by creating eight ‘Regional Development Agencies’ (RDA) to “co-ordinate economic development and regeneration activity in the regions … . [They were foreseen to become] the lead bodies at regional level for co-ordinating inward investment, raising people’s skills, improving the competitiveness of business, and social and physical regeneration … [and for] improving regional economic performance” (ibid.:2, 2000:2). New policies also broadened the ND programmes. The New Deal for People aged 50+ (ND 50+) was introduced in October 1999 and implemented from April 2000 onwards (cf. United Kingdom 2000:12). It expanded support programmes to older unemployed that hitherto had not been taken into closer consideration. Instruments of the ND25+ are applied in the ND50+ and “will be available to men and women aged over 50 who have been out of work and claiming benefits for at least 6 months” (cf. United Kingdom 1999:14). Furthermore, the government and social partners prepared a ‘Code of Practice on Age Diversity in Employment’, finalised in June 1999, as well as a cross-government active ageing project (cf. United Kingdom 1999:2 and 15, 2000:14). Similarly, the ‘New Deal for Partners of Unemployed People’ (NDPU) was introduced to help unemployed partners of JSA claimants back into work (cf. United Kingdom 1999:7f.). Before this new initiative, they were “excluded from receiving the help, advice and support the ES can provide” (ibid.:48). Acknowledging the relevance of creative industries, the ‘New Deal for Musicians’ in England and the ‘New Deal for Creative Artists’ were introduced. They target at “fine artists; performing artists; and film and video makers” (ibid.:10). These ND programmes took up the activation measures and instruments of the NDYP. Simultaneously, the reform of the tax and benefit system was pushed forward. A 10 pp income tax rate for the first £ 1,500, that means for the low paid, was introduced alongside changes in the NIC in April 1999. Moreover, as of April 2000, “the basic rate of income tax .. [was announced to] be reduced to 22p (from 23p), the National Adaptation to the ‘Policy ID’ of the EES 317 lowest basic rate for 70 years” (ibid.:37). The establishment of the ‘Single Work Focussed Gateway’ (SWFG) was planned to provide “a coherent and seamless service from the benefit system for unemployed and economically inactive people of working age by providing a single access point to benefit” (ibid.:13), including a Personal Adviser. Moreover, the NMW was set operational in October 1999 “to boost the hourly wage of almost 2 million low paid workers … by an average of 30%” (ibid.:13). The WFTC and CTC were intended to be fully implemented until April 2000, including a new income tax rate of 22 pp for families (cf. ibid.:14). The new ‘Employment Relations Act’ was establish to adopt minimum fairness standards for highly flexible forms of British work organisation. It contained “measures to ensure that companies can have a flexible, cost-effective and experienced workforce and that employees can have a work-life balance. For example, the Act ensures that part-time employees (by definition mostly women) are not treated less favourably than comparable full-timers” (United Kingdom 2000:23). Furthermore, new childcare strategies were expected to improve the situation of female workers (cf. United Kingdom 1999:38). Backed by the support of the social partners (cf. ibid.:15), the number of lifelong learning initiatives was again increased to target a broader scope of the British work force, to enhance employability and to flank already existing initiatives such as the ‘National Learning Targets’ and ‘Learning Participation Targets’ in England, the ‘National Advisory Council for Education and Training Targets’ (NACETT), the ‘National Skills Task Force’, the ‘National Training Organisations’ (NTO), the ‘Union Learning Fund’ and the ‘New Deal National Partnership’ network (cf. ibid.:15f.). In line with this enhancement of training and qualification activities to overcome the “significant divide between those who learn and those who don’t, and a long history of underachievement” (ibid.:16), the UfI, adopted in 1998, was foreseen to be fully implemented in 2000 in order to “set up a national network of learning centres” (ibid.:17). Various funds were raised to support different qualification programmes, including the ‘Further Education Access Fund’, the ‘Higher Education Access Fund’, provisions for disabled students and the ‘Adult and Community Learning Fund’. Initiatives aimed at significantly improving basic literacy and numeric skills as emphasised by the social partner (cf. ibid.:15). The IiYP was considered to be expanded to several new areas–such as a new pre-vocational gateway and a network of lifelong learning partnerships–in order to further reduce early and unprepared school-leaving rates. The setting up of a network of ICT training centres by the end of 1999 through the ‘Information Society Initiative’ (cf. ibid.:36) and the establishment of ‘Regional Employment Agencies’ (REA) added to these new initiatives “to invest in young people so that more can continue to study; double the number of learning places for adult literacy and numeracy; develop learning in the workplace; and develop an easily understood qualification system” (ibid.:16; cf. ibid.:17). Furthermore, a focus was laid on the integration of disadvantaged and disabled people into the labour market by the ‘Disabled Persons Tax Credit’ (DPCT), flanking the NDDP and introducing higher earnings ceilings and a guaranteed minimum wage for disabled people (cf. ibid.:24). The programme was to be implemented in National Adaptation to the ‘Policy ID’ of the EES 318 October 1999 in order to be fully operational in 2000/01 (cf. United Kingdom 2000:13). Additionally, legislation for a ‘Disability Rights Commission’, to be set up in spring 2000, was introduced in 1999 and particular targets were envisaged to reduce unemployment rates for ethnic minorities (cf. United Kingdom 1999:25). Several other activities were presented in the 1999 NAP to further reduce the financial burdens on SME’s and to support high-growth industries as well as selfemployment (cf. ibid.:28). As announced in the 1998 NAP, the ‘Advance Corporation Tax’ (ACT) was abolished in April 1999. The abolishment targeted at simplifying the tax system and at further reducing the second lowest non-wage labour costs in Europe (15 pp) as well as the corporate tax rate for SMEs to 20 pp (cf. United Kingdom 1998:22, 1999:37). Presented as a response to the EES’s entrepreneurship pillar, the government enhanced support for business start-ups such as by establishing the ‘Small Business Service’ (SBS) in late 1999. This SBS was planned to “improve the quality and coherence of the delivery of services to small businesses … [, to] act as a focal point within Government for communication on regulatory requirements, and offering practical assistance in complying with regulations .. [, and to] develop a new ‘Automated Payroll Service’ to help new employers” (ibid.:27). Moreover, the reduction of corporate tax level in April 2000 to 10 pp for “all companies with profits up to £10,000” (ibid.:37) was announced (cf. ibid.) and an ‘Enterprise Fund’ made national and regional venture capital available for SME (cf. ibid.:30). Finally, the new programme ‘Work Based Learning for Adults’ (WBLA) offered a training and qualification platform for people intending to become selfemployed (cf. ibid.:31). Activities of the devolved authorities amended these national initiatives (cf. ibid.:29). The 1999 JER welcomed the coherent approach adopted in the 1999 NAP “demonstrating greater co-operation between relevant departments and a more substantial contribution of social partners” (Council of the EU/European Commission 1999:Part II:87). Yet, social partner integration was assessed to be rather invisible in the area of modernisation of work organisations (cf. ibid.). The progress in reducing youth and long-term unemployment was highlighted, while the implementation of lifelong learning measures was perceived to be lagging behind. Furthermore, the JER expressed the need to outline the “balance between in-company training and policies to stimulate the individuals’ involvement in lifelong learning” (ibid.). The reform of the tax and benefit system was judged to be favourable to reduce inactivity, while the Council and the Commission criticised missing initiatives for childcare provisions. Given the high degree of de-regulation, the need to balance flexibility with social security was highlighted, even if this topic was taken up already by the British NAP itself, remarking that government was “committed to ensuring that flexibility in the labour market is coupled with fairness” (United Kingdom 1999:39). As a main instrument for balancing flexibility and security, the ‘Employment Relations Act’ was assessed to have the potential to improve the situation. Furthermore, the JER suggested that efforts should be increased to tackle the gender pay gap and equal opportunities (cf. Council of the EU/European Commission 1999:Part II:87). National Adaptation to the ‘Policy ID’ of the EES 319 Table 28: Main British Socio-economic and Employment Policies and Innovations introduced in 1999 Policy / Initiative Targeting at Thematically linked to the EES’s … pillar Classed under EG New Deal for Partners of Unemployed People, NDPU Employees, Families, Couples Equal Opportunities, Employability 1, 2 New Deal for Musicians in England Artists Employability 3 New Deal for Creative Artists Artists Employability 3 New Deal for People aged 50+, ND 50+ Older employees Employability 4 National Minimum Wage, NMW Employees, Low-paid Adaptability, Employability 4 Single Work Focussed Gateway, SWFG Unemployed, economically inactive persons Adaptability, Employability 4 Disabled Persons Tax Credit, DPTC Unemployed, Disabled Employability, Equal Opportunities 9 Small Business Service, SBS Self-employed, Unemployed Entrepreneurship 10, 11 Work Based Learning for Adults, WBLA Self-employed Entrepreneurship 11 Source: Own compilation based on chapter 5.1.1.2 and 3.2.2. While 1998 employment policies and the NAP built the base, the socio-economic policy reforms outlined in the 1999 British NAP further constructed the house. In line with government priorities outlined the same year in the Queen’s Speech, the focus of reforms remained strongly on enhancing employability and was again laid on lifelong learning initiatives as well as tax reforms to tackle unemployment and inactivity (cf. Council/European Commission 1999:Part II:87; United Kingdom 1999:6). Under this particular focus, a variety of education and lifelong learning activities were developed and started to target disadvantaged groups. They, moreover, aimed at facing problems of social exclusion, while, in parallel, job creation through further tax reforms for a business-friendly environment was prioritised to enhance the country’s economic performance. Compared to these efforts, reforms touching upon the adaptability pillar–such as especially the introduction of the NMW–were assessed to be “low key in tone, but .. [to] contain a shift of emphasis towards reinforcing security while maintaining flexibility” (Council/European Commission 1999:Part II:89). They were also perceived to create basic social standards for work. This record provides for evidence of a beginning asymmetry of ?-convergence towards the employability pillar of the EES. National Adaptation to the ‘Policy ID’ of the EES 320 Fewer new policies were introduced in 1999 than in 1998 and reform activities often extended the existing legislative framework adopted in 1998 to new groups in order to all-embrace the workforce, amending the employment policy armoury with funds and interlinking different areas. Moreover, the regional dimension of the EES started to become mirrored by first initiatives such as the creation of RDAs and REAs. 5.1.1.3 Taking Care of ‘Interior Fittings’ in 2000: Consolidating Domestic Policies in the Light of Good Performance The first supranational recommendations on the implementation of member state’s employment policies in 2000 urged the UK to focus on remaining structural shortcomings such as the reduction of youth and long-term unemployment as well as inactivity rates, the gender pay gap–still laying above the EU average–and the development of suitable policies beyond the NMW to tackle the former problem (cf. Council of the EU 2000b:Annex XV.1). The recommendations additionally criticised insufficient co-operation between the government and the social partners at all levels, requiring the enhancement of national social dialogue structures (cf. ibid.:Annex XV.2). Furthermore, the UK was asked to improve its statistical monitoring system (cf.. ibid.:Annex XV.3) and to further increase the quality of child care supplies in order to especially enable women to take up work (cf. ibid.: Annex XV:4). In its 2000 NAP, the British government–not enumerating budget implications of the single policy reforms as explicitly as in previous years–responded to these recommendations by underlining the government’s commitment to the gender mainstreaming approach. It additionally highlighted that “women tend to gain greater benefit than men from policies which are aimed at improving the work/life balance and more flexible opportunities to learn, given that women form the majority of homemakers and undertake the larger share of caring and domestic responsibilities in the UK” (United Kingdom 2000:6). It also acknowledged the overall relevance of social dialogue, however defended domestic social dialogue traditions given that they worked sufficiently, were tailor-made for the British tradition of de-centralised and voluntarist collective bargaining and were “in line with the principle of subsidiarity” (cf. ibid.:2). This protection of national traditions reflects the ‘agree-todisagree’ approach taken in case of disapproval of Commission criticism (cf. chapter 4.1.1.1). The 2000 British NAP also outlined policy responses to the recommendations, including • efforts to combat gender stereotypes (‘Connexions Strategy’, ‘New Equal Opportunities Strategy for the Career Service’); • improvement of child-care facilities and work-life balance; • combat discrimination in the pay system (incl. the ‘Valuing Women Campaign’); National Adaptation to the ‘Policy ID’ of the EES 321 • adaptation of the use and presentation of domestic statistical data; • increase childcare places and improve the childcare profession both in quantity and in quality through a national recruitment and training campaign (cf. ibib.:7ff.). The 2000 NAP explicitly welcomed the results of the Lisbon European Council (cf. United Kingdom 2000:3). It took the government’s policy priorities for that particular year–reforming the income tax and pension system as well as to further enhance education and training especially targeting at post-16 year olds (cf. Her Majesty Queen Elizabeth II 1999)–as main points of reference. It set “out the UK’s response to the challenges … [the country faces]: improving education and encouraging lifelong learning; the New Deal to help the unemployed to gain the skills that will help them into work; .. [the] programme of tax and benefit reform to make work pay and alleviate poverty for 1.4 million families” (United Kingdom 2000:FOREWORD). With this particular focus, the policy priorities of the 2000 UK NAP reflected those of the two previous years and the overall government targets for 1997, 1998, and 1999 (cf. Her Majesty Queen Elizabeth II 1997, 1998, and 1999). Since devolution of power to Scotland and Wales came into effect the previous year, tackling unemployment and employment policies remained paramount topics to be dealt with at central state level, while “authority over education, youth, training and learning, as well as economic development” (cf. United Kingdom 2000:2) became reserved to the devolved administrations. Hence, with devolution and the eight RDA established in 1999, which were amended by a ninth one for London in July 2000, the UK increasingly responded to the regional dimension of the EES. The ‘Regional Economic Strategies’, newly set up in England, form the prime instrument to support this regional dimension. They were designed to “take a holistic approach to economic and social issues and provide frameworks for better co-ordination of economic activity … joining up and developing activities in areas such as skills shortage and physical decay” (cf. ibid.:19). Regarding youth unemployment, the ND programmes–especially appreciated by the social partners (cf. ibid.:27), the Council and the Commission (Council of the EU/European Commission 2000:227)–were improved and expanded in April 2000. This improvement included the amendment of the NDLP (cf. below), the official launch of the ND 50+, the enhancement of advisory interviews and the intensification of contacts to the personal advisors under the ND 25+ (cf. United Kingdom 2000:12). Moreover and building on the experiences of the NDs, “a New Deal Continuous Improvement Strategy has been developed, linked to a New Deal Innovation Fund to support local performance improvement pilots” (ibid.). To facilitate job placement and counselling, the modernisation of the Employment Service (ES) was tackled by investing into ICT-based technology such as the telephone matching service ‘ES Direct’, the ‘ES Call Centre’ and the ‘Learning and Wordbank Internet’ site, providing for online access to vacancies’ database (cf. ibid.). Moreover, ‘Rapid Response Units’ in the different ES regions supported the local jobcentres in cases of urgency (cf. ibid.:19). National Adaptation to the ‘Policy ID’ of the EES 322 The merger of the ES and parts of the Benefits Agency was announced for 2001 in order to facilitate delivery of the two bodies and to review the domestic tax and benefit system (cf. ibid.:13). Moreover, additional tax and benefit system reforms included “changes to mortgage interest payments … allowing [for] a four-week run on to assist people waiting for their first wage” (ibid.), the extension of payments under the ‘Housing Benefit’ and ‘Council Tax Benefit’ and the introduction of ‘Job Grants’ for those leaving incapacity benefit or JSA (cf. ibid.). Some new lifelong learning initiatives were launched, aiming to provide higher quality work-based training and, due to splitting of competences, affected the authority of the devolved administrations with whose activities they were interlinked (cf. Culpepper 1999:29). Examples in this area were the ‘Learning Partnerships’ in England or the establishment of learning targets in Wales and Northern Ireland (cf. United Kingdom 2000:14). Engagement to reduce early school leaving and youth training was demonstrated inter alia by the revision of the ‘National Curriculum’ in England linking education, employment and enterprises in September 2000, the ‘Education Business Links’ and similar activities in the developed administrations as of April 2000, such as the ‘Youth Access Initiative’ in Wales, the ‘Careers Wales’ programme or the ‘Youth Gateway in Wales’ (cf. ibid.:15f.). At national level, the ‘General National Vocational Qualifications’ (GNVQs) and ‘Modern Apprenticeships’ (MAs) were upgraded and a national ‘Graduate Apprenticeship’ programme was to be launched in September 2000 (cf. ibid.:16). In order to actively fight discrimination, three commissions continued to support the government and the RDA in promoting equal opportunities (cf. ibid.:16): the ‘Equal Opportunities Commission’ (EOC), the ‘Commission for Racial Equality’ (CRE) and the ‘Disability Rights Commission’ (DRC). From April 2000 onwards, the latter disposed over “wide-ranging powers to work towards elimination of discrimination against disabled people” (ibid.:17). During 2000, all three commissions and the government collaborated in “developing Equality Direct, a pilot service which will make it easier for employers to get information about equal opportunities from a single source” (ibid.:16). Equality Direct was to be launched in January 2001. Adding to these efforts was the ES’s ‘Strategy for Engaging Ethnic Minorities’ under the NDYP. Moreover, the British government supported the integration of disabled people by passing the ‘Disability Discrimination Act’. The Act requests “service providers to make reasonable adjustments to give disabled people certain rights of access, thus helping to improve employment opportunities” (ibid.:17). As initiative to support business start-ups and SME, the ‘Enterprise Fund’ was announced to “start in as a means to increase the flow of equity finance and the growth of the venture capital industry” (ibid.:18). Additionally, the ‘PRIME’ initiative was launched to support people over 50 to start up their own business (cf. ibid.:19). Furthermore, the support of ND programmes to ‘Employment Zones’ at local level, established in 1998, was extended in April 2000 to especially “tackle the problems faced by areas where long-term unemployment is particularly high and persistent. A key innovation is the personal job account which will allow the pooling of National Adaptation to the ‘Policy ID’ of the EES 323 existing funds attributable to the unemployed through benefits, training programmes and other sources such as European funds” (cf. United Kingdom 1999:33). New initiatives announced for 2001 covered the establishment of ‘Workforce Development Plans’ within the NTO’s, “providing a structured and coherent way to define the learning and skills needs for all sectors, including the service sector” (United Kingdom 2000:20) and the introduction of the ‘Climate Change Levy’, an energy consumption tax for business comparable to the German 1999 ‘Ecological Tax Reform’ (cf. chapter 5.2), to be “offset by support for energy efficiency and a cut in employers’ National Insurance Contributions” (United Kingdom 2002:37, 2000:21). Moreover, activities of the devolved administrations, such as the review of the Scottish ‘Enterprise Network’ or the ‘Welsh Capital Challenge’, added to the initiatives in this area (cf. United Kingdom 2000:20). Presented as a response to tackle the gender pay gap and increase equal opportunities was the new ‘Equal Opportunities Strategy for the Career Service’, helping “young people to make and carry forward career choices that are free from bias. It provides opportunities for girls to realise their full potential and aim higher and in so doing removing the barriers that create gender job segregation and perpetuate stereotypical assumptions” (cf. ibid.:24). The government’s ‘Work-Life Balance’ campaign and the ‘Work-Life Challenge Fund’ were established to support the enhancement of family-friendly working conditions and the reconciliation of work and family life (cf. ibid.:25). Moreover, the implementation “of the Part-time Work Directive enhances existing legislation to further ensure fair treatment for part-timers accompanied by a programme to promote the advantages and opportunities of part-time work” (ibid.). Moreover, to foster re-integration into the labour market, a NDLP improvement package was to raise the effectiveness of the NDLP by increasing the opportunities for financial support and additional benefit instruments to facilitate transition back into work (cf. ibid.:26). The 2000 JER generally acknowledged the more visible co-operation between the British government and the social partners. It, moreover, considered the 2000 NAP to provide for a better policy mix in view of the overall ‘policy ID’ of the EES. This mix was assessed to more effectively balance the EES’s four pillars than previously, even if it was viewed to place stronger emphasis on employability and entrepreneurship. Yet, “by not distinguishing between existing and new policies, the style often renders the identification of new developments difficult” (cf. Council of the EU/European Commission 2000:224). Additionally, the contribution of social dialogue to the implementation of policies needed to be more strongly taken into consideration (cf. ibid.:225). With its “ambitious strategy to deliver full employment by ensuring job opportunities for all” (ibid.:223), the UK, according to the JER, offered sufficient response to the 2000 recommendations. Yet, challenges remained in the areas of preventing long-term unemployment by early intervention, fully implementing flagship lifelong learning policies, tackling the basic skills problem (cf. ibid.:222), increasing productivity and balancing flexibility and security (cf. ibid.:224). The UK’s employment National Adaptation to the ‘Policy ID’ of the EES 324 performance and growth were generally judged to have been favourable with the ND programmes strongly contributing to the overall positive development. Especially the NDYP was evaluated to have successfully fought youth unemployment in 2000 (cf. ibid.). Yet, regardless of this interim improvement, participation of lone parents, with the lowest rate in the EU, and especially long-term unemployment of disadvantaged people remained a cause for concern for social exclusion with the “tightening labour market .. [also] showing signs of skills gaps in certain sectors, particularly in IT” (ibid.:222). Hence, addressing low basic skills remained an area in need for further reforms, even if, by encouraging a culture of lifelong learning, the British government was believed to have made a good start. Moreover, the WFTC and the NMW were assessed to support the increase in living standards, the decrease of poverty in low-paid families (cf. ibid.:224) and the “closing [of] one of the largest gender pay gaps in the EU” (ibid.:222). Local initiatives to increase job creation as well as related initiatives of the devolved administrations and the central state government were assessed to respond positively to the regional dimension of the EES (cf. ibid.:223). Business start-ups were acknowledged to have risen significantly in 1999, compared to previous years. Improvements were related to domestic policy reforms, such as the SBS and tax reforms, creating a favourable business climate for job creation. Moreover, the ‘Employment Relations Act’ and the ‘Working Time Regulation’ were assessed to have impacted positively on the situation of women and on the British labour market in general (cf. ibid. 225). Adding to these improvements were the new provisions of childcare, establishing 170,000 new publicly funded places (cf. ibid.:227). Nevertheless, balancing flexibility and security and enhancing social security were assessed to be most important topics to be tackled by future British employment policy and labour market reforms (cf. ibid.:224) as was the proper implementation of the policy reforms presented in the NAPs over the past three years (cf. ibid.:225). Table 29: Main British Socio-economic and Employment Policies and Innovations introduced in 2000 Policy / Initiative Targeting at Thematically linked to the EES’s … pillar Classed under EG New Deal Continuous Improvement Strategy, NDCIS Unemployed, Inactive Employability 1, 2, 3 New Deal Innovation Fund, NDIF Unemployed, Inactive Employability 1, 2, 3 Job Grants Unemployed Employability 4 Graduate Apprenticeship Youth Employability 7, 8 Disability Discrimination Act Disabled People Employability, Equal Opportunities 9 ES’s Strategy for Engaging Ethnic Minorities Ethnic minorities Employability, Equal Opportunities 9 National Adaptation to the ‘Policy ID’ of the EES 325 Policy / Initiative Targeting at Thematically linked to the EES’s … pillar Classed under EG Enterprise Fund Employees, Self-Employed Entrepreneurship 10, 11 PRIME Older workers, Unemployed, Self-employed Entrepreneurship 10, 11 Workforce Development Plans Employees, Lifelong Learning Entrepreneurship, Employability 12, 13 Equal Opportunities Strategy for the Career Service (Female) Youth Equal Opportunities, Employability 19 Part-Time Work Directive Families, Parents, Women Equal Opportunities, Employability 20 Work-Life Challenge Fund Families, Parents, Women Equal Opportunities, Employability 20 Source: Own compilation based on chapter 5.1.1.3 and 3.2.2. While the 1999 NAP further constructed the house, the 2000 NAP provided for an outline on how to fit up the interior. While giving the 1997 to 1999 policy reforms sufficient time to impact, the 2000 reforms focused on the improvement of the existing legislative framework in order to make it fit for the needs of the workforce and the labour market and to align it with the new requirements of devolution. The latter aspect was paid tribute to by the integration of the devolved administrations’ programmes and reforms into the NAP. With the extension of the NDs, active labour market instruments were further intensified and policies continued to focus at disadvantaged groups such as disabled persons and ethnic minorities. The work of the three equal opportunities commissions (EOC, DRC, and CRE) underlined this focus. National priorities shined through in activities to improve the environment for business start-ups, new training and education initiatives, measures to enhance work-life balance and the reform of the basic income tax particular, targeting at families. Supranational priorities issued in the 2000 recommendations were taken up in view of gender mainstreaming activities and the amendment of childcare provisions. Not many entirely new policies were developed, but funds and grants were created and existing policies extended. However, the activation approach was enhanced (cf. Council of the EU/European Commission 2000:224) and the focus remained on measures to increase employability and entrepreneurship. Such activities again favoured the respective pillars of the EES, while, in parallel, turning the attention to ever more groups of the British workforce. This fanning out of activities was envisaged to touch upon, among others, not directly work-related sick workers, homeless people, or rural areas in order to tackle social exclusion on an even broader scale (cf. United Kingdom 2000:17). Hence and regardless of the remaining employability predominance, with the 2000 policy reforms the UK was assessed to further move “towards compliance … under the Employability, Entrepreneurship and Equal National Adaptation to the ‘Policy ID’ of the EES 326 Opportunity pillars” (Council of the EU/European Commission 2000:224), balancing previous years’ asymmetry in ?-convergence (similarity towards a common model). With the 2000 introduction of supranational recommendations, yet, also came about a partially defensive approach to encounter criticism raised by EU institutions and to explain national deviation from the EES’s ‘policy ID’ by referring to national priorities and traditions, such as in the case of social dialogue traditions. 5.1.1.4 ‘Corralling the Plot’ and ‘Unshuttering the Windows’ in 2001: Defending and Fine-Tuning Policy Choices For a More Inclusive Labour Market While recognising the UK’s “healthy employment growth … [with] employment rates for men and women .. clearly above the EU average” (Council of the EU 2001a:36), the 2001 recommendations underlined persistent structural problems of the British labour market. Among the most pressing ones were the constantly high influx in long-term unemployment, the remaining concentration of long-term unemployment on disadvantaged groups, skills gaps and a general low skills level as well as the relatively high gender pay gap accompanied by a high level of segregation between the sexes (cf. ibid.:36f.). The four recommendations issued in 2001 targeted at • “the balance of policy implementation of the Guidelines, so as to strengthen and make more visible efforts to modernise work organisation, in particular by fostering social partnership at all appropriate levels” (ibid.:37); • closing the gender pay gap and improving childcare provisions, while especially aiming at the enhancement of the situation of lone parents; • strengthening active labour market policies for the adult unemployed before reaching 12 months of unemployment given that intervention at 18 months was criticised to not sufficiently promote the re-integration into the labour market actively. This particular recommendation remained at the heart of disagreement between the supranational institutions, especially the Commission, and the UK over the years to come (cf. chapter 4.1.1.1); • intensifying the real implementation of lifelong learning initiatives and initiatives to enhance basic skills (cf. ibid.). These recommendations took up the previous year’s key points, indicating at a missing compliance of the UK to adapt and at the persistence of domestic approaches. As did the previous year’s NAP, that of 2001 responded to the recommendations by quite intensively drawing on national priorities. The British government responded to refuse intensification of early intervention before 12 month of unemployment given that most unemployed were re-entering the labour market before 12 months. Moreover, according to national assessment, the JSA and the ND programmes were offering sufficient activation measures at different points before 12 National Adaptation to the ‘Policy ID’ of the EES 327 months of unemployment, such as intensive job search interviews, the Restart instruments or participation in activation measures as precondition for benefit payments (cf. United Kingdom 2001:8f.). Presented as a response to this recommendation, the ND25+ was outlined to be further amended by “a Gateway of up to 4 months of intensive job search and help to gain work skills; an Intensive Activity Period of up to 26 weeks, including individually tailored access to basic skills or work focussed training, work experience, and support for self-employment; and a Follow Through, similar to NDYP, for up to 13 weeks” (ibid.:9). As response to the recommendation on the real implementation of the lifelong learning strategy, the UK referred to previous years’ reforms in the areas of the national curriculum, ICT training activities, the ILA, LSC, MA as well as NTO initiatives and the ‘Adult Basic Skills Strategy’ launched in March 2001 (cf. ibid.:13). Additionally, the government announced national targets for 2002, including the integration of ICT into school curricula (cf. ibid.:14). The 2001 NAP followed the 2001 government priorities of continuing to achieve a stable and high level of employment and economic growth as well as of enhancing education and training measures especially for people with disabilities (cf. Her Majesty Queen Elizabeth II 2000). The NAP, to which the devolved administrations had contributed their particular policy initiatives under the different EGs, outlines British policy responses to the EGs for 2001 in order to reach the UK’s “long-term ambition for at least three quarters of the working age population to be in work by 2010” (United Kingdom 2001:FOREWORD). This target was generally in line with the domestic aim to reach full employment as presented in the government’s March 2001 Green Paper ‘Towards Full Employment in a Modern Society’ (cf. ibid.:4). The main domestic targets laid down in the 2001 NAP were to “increase employment over the economic cycle; a continued reduction in the number of unemployed people over the age of 18 over 3 years to 2004…; increase the employment rates of disadvantaged areas and groups …; reduce the number of children in households with no one in work, over 3 years to 2004; and improve UK competitiveness by narrowing the productivity gap” (ibid.). Thus, basic skills training, especially in ICT services, and the integration of disadvantaged groups, such as long-term unemployed, lone parents, ethnic minorities, into the labour market remained at the heart of the UK NAP. New initiatives primarily aimed at reaching the most disadvantaged groups and areas. As already announced in the 2000 UK NAP, “the responsibilities of the ES and much of the Benefits Agency … merged into a single Government Agency for people of working age in 2001. The Agency … [puts] into practice a welfare to work approach with jobs and benefits delivered through a single body, making use of the latest technology and focussing on helping people to become more independent” (United Kingdom 2000:13). The NDs build a keystone of this new ‘Working Age Agency’ (cf. United Kingdom 2001:9). Moreover, the government “announced it would increase the minimum wage to £4.10 in October 2001 and, subject to the economic conditions at the time, to £4.20 in October 2002” (ibid.:11). New education and training initiatives focused inter alia on three ‘Ambition:IT’ programmes National Adaptation to the ‘Policy ID’ of the EES 328 that were to be launched in autumn 2001 as pilot projects in five cities in order to encounter skill shortages, offer unemployed skills for their integration into the knowledge society and provide them with ICT knowledge of different degrees (cf.ibid.:11). Furthermore, the full establishment of the ‘Learning and Skills Council’ (LSC) set up a network of local access points to learning opportunities (cf. ibid.:7), while the ‘Skills Task Force’ provided for an arena of tripartite social dialogue for the development of long-term lifelong learning strategies. Within this domestic lifelong learning strategy, the ‘Learning Age’ as well as the ‘Learning to Succeed’ programmes “set out the Government’s strategy for developing the ‘learning society’ by promoting post-16 participation in learning in the home, the community, the workplace and in traditional institutions” (ibid.:6). Related to active ageing policies, initiatives to support older workers were further enhanced by the ‘Age Advisory Group of leading Social Partners’ in March 2001 to co-operate with the government on age issues. Furthermore, this area was supported by the planned introduction of flexible phased-retirement schemes (cf. ibid.:12). Concerning the quality of education and training, the “new Connexions service, now being launched nationally, helps 13-19 year olds advance learning and training and works with teenagers not in learning to encourage them to re-enter” (ibid.:13). To combat discrimination and promote social inclusion, ‘Equality Direct’, announced in the 2000 NAP, was launched in January 2001 (cf. ibid.:18) and “the NDDP from July 2001 [was extended] to introduce for first time a voluntary Gateway to engage those flowing onto incapacity benefits and a national network of job brokers who could come from private, voluntary or public sector organisations …, and who will aim through matching needs to gain sustained employment for NDDP clients” (ibid.). Additionally, in November 2000 the UK government set operational the first national strategy ‘Full and Equal Citizens’ for the integration of refugees into the labour market. “A key component of it is not only to help refugees access the labour market but also to access it successfully. That means not only finding work but finding appropriate work which enables refugees to utilise skills that they learned in their countries of origin, to rebuild their lives in the UK” (ibid.:19). Moreover, in order to tackle the gender pay gap and to overcome the segregation of the labour market, from autumn “2001 eligibility for NDLP will be gradually extended to all lone parents who are not working or working fewer than 16 hours a week” (ibid.:29) and a new ‘Children’s Fund’ was set up to provide for additional financial support for children aged 5 to 13 years (cf. ibid.:31). Under the entrepreneurship pillar’s thematic focus, the UK, in January 2001, introduced the ‘Think Small First’ initiative “which provides the framework for support for all the UK’s Small and Medium Enterprises (SMEs), and identifies three priority areas to be addressed: • prevailing culture and environment, including macro-economic stability and the policy environment; • regulatory framework for business; and • support for business at each stage of the business life cycle” (ibid.:20). National Adaptation to the ‘Policy ID’ of the EES 329 Responding to the needs of devolution and to the territorial dimension of the EES, the UK government increasingly interweaved national efforts with regional and local initiatives, providing the latter with parts of the necessary resources for implementation (cf. ibid.:4f.). Moreover, to support regional and local action for employment, a new government approach to address area deprivation with a single budget for the RDAs was announced to become operational in April 2002 and the ‘National Strategy for Neighbourhood Renewal’ (NSNR) was introduced in January 2001 (cf. ibid.:22). Its key elements are local partnerships between public and private actors that aim at increasing employment rates and enhancing qualification and skills in order to improve the situation of most disadvantaged areas instead of concentrating on the improvement of the British average performance (cf. ibid.:4f.). Additionally, “Local Strategic Partnerships (LSPs) will bring together the public, private, voluntary and community sectors so that different initiatives and services support rather than contradict each other, particularly through LSPs’ duty to produce community strategies. … In support, the Government is providing a Neighbourhood Renewal Fund worth £900 million over the next 3 years, as well as a Community Empowerment Fund and a Community Chest to enable communities to run their own projects” (ibid.:5). In line with this focus, the 2001 NAP, moreover, paid considerable attention to the regional dimension of the EES by outlining the devolved administrations’ initiatives to tackle unemployment and social exclusion as well as to increase employment levels. Examples given were the Scottish ‘Social Justice … A Scotland were everyone matters’ programme established in 1999, the Welsh ‘National Economic Development Strategy’ or the ‘Northern Ireland Executive Programme for Government 2000-2004’ formulated in March 2001 (cf. ibid.:5f.). Again acknowledging the positive development of the UK labour market performance, the 2001 JER especially highlighted the ND programmes and the close link between the central state’s and the devolved administrations’ initiatives as contributing to this favourable positive development. Yet, shortcomings related to the 2001 recommendations–reduction of high inflows in long-term unemployment, skills gaps, high inactivity rates, and concentration of unemployment on disadvantaged groups–were again underlined and assessed in need to be targeted by structural reforms as was the low productivity rate (cf. Council of the EU/European Commission 2001:84 and 85). While recent policy initiatives were assessed to provide for a rather balanced response to the different pillars of the EES, the need of counterweighting the highly flexible British labour market with measures to increase security was perceived to be as relevant as in previous years. The same held true for a more institutionalised and less ad-hoc consultation process between the government and the social partners. Further points of criticism were the poor level of basic skills within the British workforce, the remaining large gender pay gap, for which targets existed, yet, no concrete policy approaches were discernible as well as the partial resistance to introduction early intervention at 12 months of unemployment (cf. ibid.:85). Although assessed positively by the 2001 JER, the ‘National Childcare National Adaptation to the ‘Policy ID’ of the EES 330 Strategy’ and the initiatives to integrate lone unemployed parents into the labour market remained areas, in which implementation was to be closely monitored (cf.ibid.:84). Table 30: Main British Socio-economic and Employment Policies and Innovations introduced in 2001 Policy / Initiative Targeting at Thematically linked to the EES’s … pillar Classed under EG Ambition IT Unemployed Employability 2 Working Age Agency Unemployed, Benefit claimants Employability 2 Connexions Service Youth Employability (Basic Skills) 4 Equality Direct Ethnic Minorities; Disadvantaged Equal Opportunities 7 Full and Equal Citizens Ethnic Minorities; Disadvantaged Employability, Equal Opportunities 7 Think Small First SME, Self-employed Entrepreneurship 8 Local Strategic Partnership, LSP Unemployed, SME, Self-employed, Regional Development Entrepreneurship 11 Neighbourhood Renewal Fund Unemployed, SME, Self-employed, Regional Development Entrepreneurship 11 Community Empowerment Fund Unemployed, SME, Self-employed, Regional Development Entrepreneurship 11 Community Chest Unemployed, SME, Self-employed, Regional Development Entrepreneurship 11 Source: Own compilation based on chapter 5.1.1.4 and 3.2.2. National Adaptation to the ‘Policy ID’ of the EES 331 While in 2000, the focus laid on fitting up the interior, the 2001 NAP aimed at corralling the plot with the justification of national priorities. In parallel, it focused on unshuttering the windows to integrate new groups of indigent disadvantaged people and new elements to enhance the domestic employment performance. Deviation from the supranational assessment summarised in the 2001 recommendations was, as in the previous year, justified by domestic priorities and traditions. So, partial resistance to adapt came through again in 2001 with the UK government’s priorities focusing on a stable economic environment for full employment, at enhancing education and training activities especially for disabled persons and at increasing labour productivity. Besides the improvement of delivery by the merger of the ES and the Benefit Agency, the increase of the NMW and the establishment of the ‘Children Funds’ mirrored efforts to create a more inclusive society. While the development of a business-friendly environment continued, the advantages of devolution were exploited more intensively by presenting the devolved administration’s programmes under the single EGs and by outlining the interweavement of regional and national initiatives especially in the area of education and training as well as the co-funding of regional activities by the national budget. Compliance with the regional and local dimension of the EES in order “to be even more joined up and to find new ways to work with local partners, as well as supporting and monitoring local progress, disseminating good practice, and changing central methods where necessary” (ibid.:5) was documented in this way. With a view to the main policy initiatives to achieve the government’s priorities and those prescribed by the EES, the 2001 NAP, like those of previous years, again referred to the ND/Welfare-to-Work Programmes, the Making-Work-Pay initiative and to related tax reforms (cf. United Kingdom 2001:4). Moreover, reporting on implementation and policy outcome took a strong position within the 2001 NAP. With the outlined policy initiatives, the 2001 NAP concentrated on the EES’s employability and entrepreneurship pillar, again reinforcing asymmetric ?convergence (similarity towards a common model). New major policy reforms were not undertaken and a clear focus was laid on fine-tuning the status-quo in order to create a more inclusive labour market. 5.1.1.5 ‘Outbuilding the House’ and ‘Designing the Grounds’ in 2002: Keeping to the Domestic Approach and Adapting Structurally to Devolution The 2002 recommendations, as did those of previous years, criticised four elements of perceived enduring mal-performance and structural inadequacy: • missing institutionalised approach to social partnership at national level; • persistently huge gender pay gap and imbalance of labour market participation of both sexes; National Adaptation to the ‘Policy ID’ of the EES 332 • remaining high rate of inactivity and inflow in long-term unemployment as well as low employment levels of disadvantaged groups and in disadvantaged areas; and • continuingly low basic skills levels (cf. Council of the EU 2002b:80). Resulting from this criticism, the four recommendations repeated the advice to focus stronger on the establishment of a more institutionalised national tripartite social dialogue and the extension of the present ad-hoc approach, especially with a view to work modernisation, labour productivity, and basic skills. The British government was, moreover, urged to amplify measures to diminish the gender pay gap and to enhance equal opportunities, including the analysis of the outcome of previous policies to increase childcare facilities. As in 2001, it was recommended to introduce early intervention for the adult unemployed before 12 months of unemployment to add to the existing support under the JSA. Special attention was suggested to be given to disadvantaged groups in this context. Finally, work-based training should be reinforced to increase basic skills and the overall level of qualification of the workforce (cf. ibid.). In view of the domestic situation, the UK government acknowledged that “even with stable growth and the right incentives, some people struggle to get jobs and need additional support tailored to their particular needs. A central challenge for the UK is therefore to match the people without jobs to the jobs without people, as quickly as possible” (United Kingdom 2002b:2). Regarding the 2002 recommendations, the 2002 NAP, as in previous years, responded by partially referring national practice back to domestic traditions. So, the recommendation to further institutionalise national social dialogue was again rejected by pointing at the already increased scope of social partner integration over the past years and at the “distinctive model of social partnership” (ibid.:6) within the UK. This model was assessed to allow for the broadest possible integration of stakeholders at national level, including national initiatives such as the ESF co-funded ‘Work Organisation Project’ (CBI), the ‘HEADSTART’ initiative (CBI), the ‘Partnerships for Prevention’ project (CBI/TUC), the ‘Changing Times’ process (TUC) or the ‘Our Time’ project (partnership project with TUC participation) (cf. ibid.:38). So, rather “than building new institutions and formal structures, the involvement of social partners, and civil society more generally, is determined by the particular needs of the issue under consideration” (ibid.), preserving the particular British approach not comparable to the Continental social partnership tradition. With this response, the UK government repeated its arguments of the two previous years without showing will to further adapt to the European model. Regarding the recommended reduction of the gender pay gap, the UK government referred to “an independent, in-depth review, known as the ‘Kingsmill Review’, into women’s employment prospects and pay in the UK” (ibid.:6). This review was presented in December 2001 along with a national scientific study on the gender pay gap in order to increase knowledge on the preconditions of that particular structural problem. Among the newly adopted measures to reduce the divide National Adaptation to the ‘Policy ID’ of the EES 333 between female and male participation and pay were the ‘Castle Awards’, “introduced in March 2002 to encourage, identify and reward good practice in reviewing pay systems and structures within organisations to recognise employers who show excellence in addressing equal pay” (ibid.:7), and the ‘Equal Pay Review Model’, announced to be developed by the EOC to set up a model for pay reviews. The government, moreover, started to co-fund the training of ‘Equal Pay Representatives’ “in pay negotiations and methodology in 2001-02” (ibid.) by the trade unions. It, furthermore, introduced the ‘Equality Standard for Local Government’ “as a Best Value Performance Indicator for 2002-03” and started the review of government department’s and agencies’ pay systems in April 2003, including equality and race issues (ibid.). Additionally, the inter-departmental review of childcare was announced to result in a 10-year vision of reconciling work and family life with the ambitious target to provide for a childcare place for every lone parent re-entering into work by 2004 (cf. ibid.:7f.). Compared to this rather proactive answer related to the gender pay gap, the government’s response to the recommendation on early intervention was more reserved. As in previous years, it referred to instruments already in place, such as the JSA and the ND25+ (cf. ibid.:9). It assessed the further “introduction of nontargeted, largescale programmes for the adult unemployed before this point .. [to] lead to significant deadweight costs (probably at least 90%)” (ibid.:10). It, moreover, referred to positive evaluation of the British practice by the OECD (cf. ibid.:11). Regarding future activities related to the fourth recommendation on the enhancement of basic skills, the UK government pointed at the ‘Workforce Development Strategy’ to be elaborated by the LSC. The strategy was foreseen to “set clear targets and measures for improving the skills levels of the workforce and will also include proposals for engaging more employers of all sizes in learning, including increasing the range of training offered by employers for employees” (ibid.:12). Adding to these proposals were the ‘Employer Training Projects’ that were introduced in six pilot areas in September 2002. They inter alia provide wage substitution by the state for employees taking part in training measures. In line with the 2002 government priorities of economic stability, further reform of education as well as the welfare, tax credits and pensions systems (Her Majesty Queen Elizabeth II 2001), the 2002 strategic goal of the British government was again to realise employment opportunities for all and, hence, to achieve full employment (cf. United Kingdom 2002a and 2002b:2). Taking up this priority, the 2002 NAP presented a domestic perception that was slightly deviating from the EES’s quality in work idea. The government stated that the core “prerequisite for quality in work is work itself .. [and that] there is no quality for those without a job; therefore meeting the Lisbon targets must be a first priority” (ibid. 2002b:4). Even if, over the past five years, the New Labour government had shown its interest to enhance the quality of working conditions and work organisation in the UK and reinforced this commitment in the 2002 NAP (cf. ibid.), this introductory remark, to a certain extent, reminded of the Thatcherite neo-liberal ‘any work is good work’ approach that did not really match with the underlying ‘policy ID’ of the EES. National Adaptation to the ‘Policy ID’ of the EES 334 The 2002 NAP presented medium-term targets for 2004 and long-term targets for 2010 to realise the envisaged employment opportunities for all. The medium-term targets included • reduction of the number of households with no one in work; • general decrease in unemployment of people over 18 years of age until 2004; • strengthening literacy and numeric skills for 750,000 people by the ‘Skills for Life’ strategy; and • inclusion of socially disadvantaged groups (cf. ibid.:3). As long-term targets the NAP set out efforts to • augment participation in the labour market in order to increase the number of people in employment; • aim at an increase to 70 pp of lone parents in work; • bring more young people into further and higher education; and • halve child poverty in order to eliminate it until 2022 (cf. ibid.). Additional future activities included the reduction of welfare dependence and inactivity, the diminution of remaining long-term unemployment, structural adaptation in view of early intervention to prevent long-term unemployment, the fight against discrimination of disadvantaged groups and the enhancement of skills, learning, and education (cf. ibid.). The creation of ‘Jobcentre Plus’ in April 2002 finally brought together all competences of the Employment Service and the Benefits Agency for providing job focused services for people claiming benefit (cf. ibid.:16). It established “the platform to ensure that everyone who wants to work gets the help they need, when they need it; a new approach to help people get into jobs, or improve their prospects for work in the future; face to face support on a regular basis, to check the right benefits; training and other help” (cf. ibid.:3). ‘Jobcentre Plus’ intends to advance the transition from “a passive benefit payment system into an active welfare state” (ibid.:16) and especially aims at bringing inactive people into work. Additionally, the ‘Step Up’ scheme was introduced in May 2002 in six areas with especially high unemployment levels, before 14 additional areas were included in December 2002. The scheme, also comprising training courses, provides for a new instrument to coerce unemployed to take up work instead of further receiving benefit payments (cf. ibid.). In line with these new instruments, the WFTC was announced to “be extended to those without children and disabilities in 2003, with the introduction of the Working Tax Credit” (ibid.:17). Moreover, the ‘Child Tax Credit’ was envisaged to be paralleled to these initiatives by the reduction of taxes for families. To improve the quality of education and training systems, the ‘Skills for Life’ strategy and the ‘Learning Participation Target’ provided for new national approaches to increase basic skills. They strongly focus on unemployed, benefit payment receivers and disadvantaged groups. The ‘Skills for Life’ strategy primarily aims at achieving the 2004 medium-target to enhance the skills of 750,000 people National Adaptation to the ‘Policy ID’ of the EES 335 (cf. ibid.:18f.). Moreover, the LSC campaign ‘Bite Size’ was announced to become operational in 2002 to encourage people to re-enter learning and the new UfI’s strategic plan for 2004/05 was launched parallel to the 2002 NAP. In order to support adaptability in enterprises, ‘New Technology Institutes’ were announced to be set up “to boost the level of research and development, innovation and technology transfer and to provide regions with the skills in ICT and high technology they need” (ibid.:31f.). Targeting to further develop job matching, several new initiatives to improve delivery by the ES were introduced. So, access “to vacancies … [was] further expanded from April 2002 with the introduction of: Employer Direct, which will enable employers to input and manage their vacancies directly via e-mail and the ES internet Job bank; and Jobseeker Direct, which will allow people to access vacancies at home, schools, and libraries. Also from April 2002, the ES will roll out CV Bank which will allow employers direct access to jobseekers’ employment details. These enhancements will encourage mobility within the UK as well as the EU, the latter through direct access and through EURES” (ibid.:30). Adding to these innovations, the ‘Sector Skills Councils’ (SSC) and the ‘Sector Skills Development Agency’ (SSDA) were set up in March and April 2002 respectively. They aim to improve the conditions for sectoral skills settlements, “are created by business for business” (ibid.:31) and collaborate with the RDA, the ES, the LSC and the Connexions initiative. To fight discrimination, new instrument were discussed during 2002 and a ‘Custody to Work’ programme was set up “to increase the number of prisoners … getting jobs or education or training places after release” (ibid.:24). Furthermore, modernising work organisation, the new Employment Bill–in the legislative pipeline in 2002–was foreseen to regulate notification and qualification periods, oblige employers to consider work flexibility for parents with children under six years of age if requested, facilitate dispute settlement in the workplace and support the prevention of pay and pensions gaps for some sort of contracts (cf. ibid.:39). Moreover, “the right to take time off in addition to paid parental leave, was extended to working parents of children born or adopted between 15 December 1994 and 14 December 1999” (ibid.). In view of measures to enhance equal opportunities, some of which co-funded by the ESF (cf. ibid.:45), the ‘Women and Equality Unit’ (WEU) announced to set up a ‘Gender Impact Assessment’ (GIA) framework for the evaluation of policy impact on both sexes during 2002/03. It “consists of a sequence of steps to be followed paying attention to, among other matters, the following topics: identifying issues, defining outcomes, collection of data, communication strategy, monitoring and evaluation” (ibid.:44). Moreover, the extension of maternity leave period as well as paid paternity leave was envisaged for 2003 to strengthen childcare provisions (ibid.:48). In order to create a more business-friendly environment, the British government announced further tax reforms, including facilitation of the VAT administration provisions, “new exemptions from tax on some gains, a cut which could cover three quarters of all business, and changes which mean that companies with smaller National Adaptation to the ‘Policy ID’ of the EES 336 taxable profits will pay no corporation tax at all” (ibid.:36). Additionally, new pilot projects to increase participation in training activities for people endangered by basic skills gaps were launched in September 2002. They included free training opportunities and state co-financing of employees’ wages during training phases (cf. ibid.:37). Amending the 2001 ‘Climate Change Levy’ (cf. chapter 5.1.1.4), the government announced to prepare “a new Sustainability Fund to reduce the environmental impact of aggregates extraction. Budget 2002 in April also introduced an exemption for all electricity produced by combined heat and power from the Climate Change Levy. Electricity generation from coalmine methane offers new employment opportunities as well as environmental gains, and this too will, from this summer, be exempted from the Climate Change Levy” (ibid.:36). More than in the previous year, the 2002 NAP was characterised by consolidating devolution with separate parts prepared by the devolved administrations annexed to the main NAP text (cf. United Kingdom 2002b:58ff.). In terms of initiatives, ‘City Growth Strategies’ to support economic and business development as well as a new ‘Skills and Knowledge’ programme were announced to be developed during 2002. The latter was foreseen to comprise “ • a Learning and Development Strategy …; • Community Learning Chests, to provide grants for people or organisations to access training and advice, or to finance study visits; • on-line access to evidence of ‘what works’ …; • recruitment of face-to-face advisers to support neighbourhood partnerships” (ibid.:33). Moreover, from April 2002 onwards the RDAs “have [finally] been given a single pot of funding, and increased autonomy, to pursue their regional strategies” (Council/European Commission 2003:274; cf. United Kingdom 2002:34). Also ‘Local Strategic Partnerships’ (LSP) were established to enhance public services’ delivery (cf. United Kingdom 2002:35). Additionally, the devolved administrations presented explicit initiatives and programmes to strengthen regional economic and employment performance very much aligned to the overall ‘policy ID’ of the EES. Among these initiatives were the Scottish ‘Working Together for Scotland – A Programme for Government’ and ‘A Smart Successful Scotland – Ambitions for the Enterprise Networks’, the Welsh ‘A Winning Wales’ and ‘Skills and Employment Action Plan as well as Northern Ireland’s ‘New Targeting Social Need Policy’ and the ‘Taskforce on Employability and Long-Term Unemployment’ (cf. United Kingdom 2002:4ff.). The JER 2002 was again positive about the labour market performance of the UK given that the overall economic slowdown had not intensively affected the country (Council of the EU/European Commission 2003:272). It was acknowledged that important new developments concentrated on fighting economic inactivity with the nation-wide extension of Jobcentre Plus in April 2002. The overall economic and legislative environment was perceived to be supportive to entrepreneurship, National Adaptation to the ‘Policy ID’ of the EES 337 especially in disadvantaged communities (ibid:274). With a view to enhancing adaptability, progress was recognised to have been achieved since 1997 in establishing a framework of minimum workplace standards, including the NMW, paid holidays and parental leave as well as equal rights of part-time and full-time workers. At the same time, the adaptability pillar was again assessed to concentrate too strongly on a decentralised and voluntarist social partnership approach (ibid:275). Planned steps to prevent discrimination in pensions and pay for employees with temporary contracts were evaluated to improve quality in work. Yet, it was also recommended to “strengthen incentives for employers to train low skilled women” (ibid.:276). The 2002 JER assessed quality in work not sufficiently mainstreamed in the 2002 NAP and the implementation of lifelong learning and training measures to have slowed down (ibid:273). Further efforts were viewed to be needed to integrate employers into efforts to enhance quality in work, even if progress related to national education targets seemed promising. “Policy should therefore be carefully targeted at providing incentives to those most in need of workplace (the low skilled) and those least able to pay for it (SME’s)” (ibid:277). While positively evaluating the progress in view of childcare facilities, the JER stated, that the “gap between supply and demand remains significant, so momentum should continue” (ibid.:277). Also the gender pay gap was assessed to require further attention (ibid:276). Table 31: Main British Socio-economic and Employment Policies and Innovations introduced in 2002 Policy / Initiative Targeting at Thematically linked to the EES’s … pillar Classed under EG Jobcentre Plus Unemployed; Benefit Claimants Employability 1, 2 Step Up Unemployed; Benefit Claimants Employability 1, 2 Skills for Life Unemployed; Benefit Claimants, Low-skilled Employability 4 Bite Size Workforce, Low-skilled Employability 4 Employer Training Projects Employers, Employees, Low-skilled Employability 6 Workforce Development Strategy Employees, Low-skilled Employability 6 Sector Skills Councils, SSC Employers, Employees, Low-skilled Employability 6 National Adaptation to the ‘Policy ID’ of the EES 338 Policy / Initiative Targeting at Thematically linked to the EES’s … pillar Classed under EG Sector Skills Development Agency, SSDA Employers, Employees, Low-skilled Employability 6 Custody to Work Unemployed, Ex-offenders, Disadvantaged Employability 7 Employment Bill Employers, Employees Adaptability 13, 14 Gender Impact Assessment, GIA Women, Gender Gap Equal Opportunities 16 Castle Awards Women, Gender Pay Gap Equal Opportunities 17 Equal Pay Review Model Women, Gender Pay Gap Equal Opportunities 17 Source: Own compilation based on chapter 5.1.1.5 and 3.2.2. While the 2001 NAP focused on corralling the plot and unshuttering the windows, the 2002 NAP concentrated on further outbuilding the house by keeping the domestic approach and designing the wider ground by structurally adapting the NAP to devolution. The 2002 NAP took up a more strategic approach than its predecessors by introducing medium and long-term targets for the development of the British workforce and labour market. It, moreover, laid the focus of attention on the EES’s employability and equal opportunity pillars. Initiatives such as the reduction of inactivity and welfare dependence, the fight against discrimination and long-term unemployment and the increase of basic skills indicated into this direction. They, yet, again tended towards asymmetric ?-convergence (similarity towards a common model). The establishment of ‘Jobcentre Plus’ added to the amendment of the British activation approach. The government’s focus on economic stability to achieve full employment, welfare, tax and pension reforms as well as increased education and training broadly determined the focus of the 2002 UK NAP, just like in previous years. Initiatives as the ‘Working Tax Credit’, the ‘Child Tax Credit’ reform, the amendment of the ‘Climate Change Levy’, the ‘Skills for Life’ strategy, the GIA, the SSC and SSAD as well as the new Employment Bill were outlined as main output related to these government priorities. Reflecting the outcome of devolution more precisely, the structure of the 2002 NAP was adapted by annexing particular sections prepared by the devolved administrations to explain their policy priorities and initiatives. The implementation of the regional dimension of the EES, hence, became more easily traceable by this adaptation. Even more than in previous years, the 2002 NAP was characterised by a strong focus on reporting on policy implementation and outcome to state compliance with the EES’s ‘policy ID’. Policy innovation and reforms remained limited. National Adaptation to the ‘Policy ID’ of the EES 339 5.1.2 ‘Extending the Driveway’: Expanding Existing Policy Approaches under the Streamlined EES (2003-2005) – Europeanisation Impact Intensified or Blurred? The 2003 and 2004 Council recommendations bemoaned the “relatively low levels of productivity in part due to insufficient levels of basic skills, and specific job quality-related problems like the gender pay gap and lack of access to training for some categories of workers” (Council of the EU 2003e:30; cf. ibid. 2004b:58). This problems were assessed to constitute main areas for necessary reforms particularly to be tackled by the further development of the national social partnership approach. Adding to this criticism, increasing disability and sickness benefit claimant rates as well as asymmetric access to the labour market disfavouring especially disadvantaged groups gave cause for additional concern. The 2003 recommendation, therefore, urged the UK to strengthen active labour market instruments to more intensively and proactively integrate disadvantaged groups. They, moreover, recommended to increase incentives to take up and stay in work by reviewing the domestic sickness and disability benefit system and by providing work for all those able to work. Once again, concerns were raised about the gender pay gap and it was proposed to improve cross-sectoral as well as cross-professional and training integration of women (cf. ibid. 2003e:30). Taking up this 2003 evaluation, the 2004 recommendations, additionally, urged the UK to improve productivity of work and the balance work productivity and wage development, to increase basic skills levels by enhancing national and regional skills and learning strategies in order to foster productivity, to decrease the rate of disability and sickness benefit claimants by focused active labour market policies, to provide for sufficient access to childcare places and to increase training measures particular for low-skilled and low-paid women (cf. ibid. 2004b:58). The 2003 and 2004 British NAPs responded to the recommendations in the main text, instead of merely annexing answers to the plans. Given that no recommendations were issued in 2005, the 2005 National Reform Programme (NRP) comprised no such part. In view of the recommendation on the improvement of the activation approach, the 2003 and 2004 NAPs pointed at the extension, modernisation, decentralisation, and adaptation of Jobcentre Plus by ‘Building on New Deal’ to improve active placement support as well as at the introduction of the ‘New Deal for Skills’ to enhance basic skills levels (cf. ibid.:9, 2004:3 and 6). Concerning the recommendation to further improve and institutionalise national social partnership, the British government, as in previous years, pointed at the autonomy of social partners, the well-established domestic practice of de-centralised and ad-hoc social dialogue and different national fora, providing for the integration of social partners into the political process, such as the RDA or the Low Pay Commission (cf. ibid. 2003:16). Yet, apart from this rather defensively-minded reference to national social dialogue traditions, interaction was intensified by the government’s request to the social partners to identify areas of future bilateral engagement and integration. Social partners answered to this request by pointing at the Low Pay Commission, the Work and Parents Work Force, or further co-operation to improve skills levels (cf. ibid.).