PURPOSE: to mobilise the European Globalisation Adjustment Fund (EGF) to assist Ireland following redundancies in its aircraft repair and installation services.

NON-LEGISLATIVE ACT: Decision (EU) 2015/643 of the European Parliament and of the Council on the mobilisation of the European Globalisation Adjustment Fund (application EGF/2014/016 IE/Lufthansa Technik from Ireland).

CONTENT: by this Decision, the European Parliament and the Council decided to mobilise EUR 2 490 758 in commitment and payment appropriations from the European Globalisation Adjustment Fund in the framework of the 2015 budget.

This amount shall assist Ireland following redundancies in Lufthansa Technik Airmotive Ireland Ltd and two suppliers in Ireland.

Given that the Irish application complies with the requirements laid down in Regulation (EU) No 1309/2013 ( EGF Regulation 2014-2020 ), the European Parliament and the Council decided to mobilise the abovementioned amount.

To recall, the European Globalisation Adjustment Fund (EGF) was established to provide support for workers made redundant and self-employed persons whose activity has ceased as a result of major structural changes in world trade patterns due to globalisation, as a result of a continuation of the global financial and economic crisis addressed in Regulation (EC) No 546/2009 of the European Parliament and of the Council, or as a result of a new global financial and economic crisis and to assist them with their reintegration into the labour market.

Council Regulation (EU, Euratom) No 1311/2013 laying down the multiannual financial framework for the years 2014-2020 allows the mobilisation of the EGF within a maximum annual amount of EUR 150 million .

ENTRY INTO FORCE: 15.04.2015.

The European Parliament adopted by 522 votes by 74, with 8 abstentions, a resolution on the proposal for a decision of the European Parliament and of the Council on the mobilisation of the European Globalisation Adjustment Fund for an amount of EUR 2 490 758 in commitment and payment appropriations in order to assist Ireland following redundancies in its aircraft repair and installation services.

Parliament recalled that the Union set up legislative and budgetary instruments to provide additional support to workers who are suffering from the consequences of major structural changes in world trade patterns and to assist their reintegration into the labour market.

Irish application : Ireland submitted application EGF/2014/016 IE/Lufthansa Technik for a financial contribution from the EGF, following a total of 424 redundancies in Lufthansa Technik Airmotive Ireland Ltd (LTAI) and two of its suppliers in Ireland. Members stated that the application does not fulfil the eligibility criteria laid down in Article 4(1)(a) of the EGF Regulation and is based on the exceptional circumstances provision contained in Article 4(2) of that Regulation. By exceptional circumstances, this means that the redundancies have a serious impact on employment and the local and regional economy, and justify a derogation from the intervention criteria set out in Article 4(2) of the EGF Regulation.

Therefore, Ireland is entitled to a financial contribution under that Regulation .

Parliament noted, however, that the exceptional circumstances in this case relate to only 250 persons and therefore recommended that the Commission to establish clear criteria for applications relating to less than 500 workers. It stated that if the criteria laid down in Article 4(1)(a) of that Regulation are not entirely met, applications should be assessed on a case-by-case basis and that there should not be an automatic endorsement of applications that don't meet the basic conditions.

Nature of the redundancies : Parliament considered that the redundancies in the 'repair and installation of machinery and equipment' sector in the region of Southern and Eastern Ireland are linked to major structural changes in world trade patterns due to globalisation, as shown by the closure of LTAI as a result of a serious shift in Union trade in goods and services resulting from a technological shift towards the production of new generation aircraft and components, by the shift in wider aircraft component production practices with resultant impacts on the market fundamentals of the underlying business model of LTAI and the shift in location of global aircraft production.

These redundancies are expected to have huge negative impacts on Southern and Eastern Ireland, which presents pockets of considerable local disadvantage , with low levels of educational achievement, lack of professional qualifications and a high level of local authority housing. All these factors point to considerable local disadvantage and poverty and that, moreover, a series of redundancies in enterprises in this sector over the last years has made it even more difficult for the workforce that possesses some very specific skills that are difficult to exploit in other sectors.

Parliament noted that Blanchardstown-Tyrrelstown, Tallaght-Killinarden, Clondalkin-Rowlagh and Tallaght-Fettercairn are a few of the areas where the Lufthansa workers reside where the average unemployment figure is around 23%.

Package of personalised services : Parliament noted that the coordinated package of personalised services to be co-funded consists of guidance and career planning, EGF training grants, training and further education programmes, higher education programmes, enterprise and self-employment supports, income supports including the EGF course expense contribution scheme.

NEET : the resolution noted that the Irish authorities decided to provide personalised services co-financed by the EGF to up to 200 young people not in employment, education or training (NEETs) under the age of 25 in addition to the redundant workers (despite the fact that this in this case, the NEETs do not belong to the group of redundant workers and were not employed in the same sector ). It noted the personalised services which are to be provided to NEETs consist of the same options as for the redundant workers but will be tailor-made for each NEET individual as appropriate.

Parliament noted that the authorities plan to utilise the maximum allowed 35% of all costs on allowances and incentives in the form of income supports including course expense contributions (CECs); acknowledges that those allowances do not replace the measures provided from national funds.

It also recalled the importance of improving the employability of all workers by means of adapted training and the recognition of skills and competences gained throughout a worker's professional career. Parliament stressed that EGF assistance can co-finance only active labour market measures which lead to durable, long-term employment.

Lastly, it recommended that the Commission evaluate the possibility of reducing the required minimum number of workers made redundant to 200 for EGF projects because of the impact on unemployment generated by redundancies in SMEs affected by the economic crisis.

The Committee on Budgets adopted the report by Victor NEGRESCU (S&D, RO) on the proposal for a decision of the European Parliament and of the Council on the mobilisation of the European Globalisation Adjustment Fund for an amount of EUR 2 490 758 in commitment and payment appropriations in order to assist Ireland following redundancies in its aircraft repair and installation services.

Members recalled that the Union set up legislative and budgetary instruments to provide additional support to workers who are suffering from the consequences of major structural changes in world trade patterns and to assist their reintegration into the labour market.

Irish application : Ireland submitted application EGF/2014/016 IE/Lufthansa Technik for a financial contribution from the EGF, following a total of 424 redundancies in Lufthansa Technik Airmotive Ireland Ltd (LTAI) and two of its suppliers in Ireland. Members stated that the application does not fulfil the eligibility criteria laid down in Article 4(1)(a) of the EGF Regulation and is based on the exceptional circumstances provision contained in Article 4(2) of that Regulation. By exceptional circumstances, this means that the redundancies have a serious impact on employment and the local and regional economy, and justify a derogation from the intervention criteria set out in Article 4(2) of the EGF Regulation.

Therefore, Ireland is entitled to a financial contribution under that Regulation.

Members noted, however, that the exceptional circumstances in this case relate to only 250 persons. Therefore, they recommended that the Commission establish clear criteria for applications relating to less than 500 workers. According to the Members, if the criteria laid down in Article 4(1)(a) of that Regulation are not entirely met, applications should be assessed on a case-by-case basis.

Members also welcomed the fact that, in order to provide workers with speedy assistance, the Irish authorities decided to initiate the implementation of the personalised services to the affected workers on 7 December 2013, well ahead of the decision and even the application on granting the EGF support for the proposed coordinated package.

Nature of the redundancies : Members highlighted that the redundancies are linked to major structural changes in world trade patterns due to globalisation, as a result of a serious shift in Union trade in goods and services resulting from a technological shift towards the production of new generation aircraft and components, and the shift in location of global aircraft production.

These redundancies are expected to have huge negative impacts on Southern and Eastern Ireland, which presents pockets of considerable local disadvantage and workers with a lack of professional qualifications. Moreover, a series of redundancies in enterprises in this sector over the last years has made it even more difficult for the workforce that possesses some very specific skills that are difficult to exploit in other sectors to find a new job. Members regretted that this is particularly true for those workers who are closer to retirement (around 20 % of the Lufthansa Technik workers) or have been with that same employer for a number of years.

Package of personalised services : Members noted that the coordinated package of personalised services to be co-funded consists of guidance and career planning, EGF training grants, training and further education programmes, higher education programmes, enterprise and self-employment supports, income supports including the EGF course expense contribution scheme.

They recalled that in line with Article 7 of the EGF Regulation, the design of the coordinated package of personalised services should anticipate future labour market perspectives and required skills and should be compatible with the shift towards a resource-efficient and sustainable economy.

NEET : the report noted that the Irish authorities decided to provide personalised services co-financed by the EGF to up to 200 young people not in employment, education or training (NEETs) under the age of 25 in addition to the redundant workers (despite the fact that this in this case, the NEETs do not belong to the group of redundant workers and were not employed in the same sector). It noted the personalised services which are to be provided to NEETs consist of the same options as for the redundant workers but will be tailor-made for each NEET individual as appropriate.

Members recalled the importance of improving the employability of all workers by means of adapted training and the recognition of skills and competences gained throughout a worker's professional career. They stressed that EGF assistance can co-finance only active labour market measures which lead to durable, long-term employment.

Lastly, Members recommended that the Commission evaluate the possibility of reducing the required minimum number of workers made redundant to 200 for EGF projects because of the impact on unemployment generated by redundancies in SMEs affected by the economic crisis.

PURPOSE: to mobilise the European Globalisation Adjustment Fund (EGF) to assist Ireland following redundancies in its aircraft repair and installation services.

PROPOSED ACT: Decision of the European Parliament and of the Council.

CONTENT: Article 12 of Council Regulation (EU, Euratom) No 1311/2013 laying down the multiannual financial framework for the years 2014-2020 provides that the EGF shall not exceed a maximum annual amount of EUR 150 million (2011 prices) over and above the relevant headings of the financial framework.

The rules applicable to financial contributions from the European Globalisation Adjustment Fund (EGF) are laid down in Regulation (EU) No 1309/2013 of the European Parliament and of the Council on the European Globalisation Adjustment Fund (2014-2020) and repealing Regulation (EC) No 1927/2006 (the 'EGF Regulation').

In this context, the Commission examined the application for mobilisation of the EGF to assist Ireland and concluded the following:

Ireland: EGF/2014/016 IE/Lufthansa Technik : the Irish authorities submitted application EGF/2014/016 IE/Lufthansa Technik for a financial contribution from the EGF, following redundancies in Lufthansa Technik Airmotive Ireland Ltd (LTAI) and two of its suppliers in Ireland.

The Irish authorities submitted the application within 12 weeks of the date on which the intervention criteria set out below were met. The deadline expired on 6 February 2015.

In order to establish the link between the redundancies and major structural changes in world trade patterns due to globalisation, Ireland argues that the closure of the LTAI is a result of a serious shift in the EU trade in goods and services resulting from a technological shift towards the production of new generation aircraft and components; a shift in wider aircraft component production practices with resultant impacts on the market fundamentals of the underlying business model of LTAI and a shift in location of global aircraft production.

Over the last 20 years, the most popular aircraft types have evolved from largely allmetal, mechanical, electro-mechanical, hydraulic and pneumatic designs to increasing composite, metal/composite structures, fly-by-wire automated, fully computer-controlled aircraft.

With the arrival of further new generation types such as the B737 Max and A320 Neo, operators have moved to retire the older classic aircraft and to some extent the older versions of the new generation types.

The traditional business model of LTAI was based on a number of elements which have come under severe pressure as a result of changes in the world aircraft fleet profiles and resultant rapid decline of the aircraft models that formed the base of the LTAI portfolio. A driving force behind increases in global air travel growth has been the industrialisation of countries such as India and China. In Asia Pacific and the Middle East, ambitious construction plans for new international and domestic airports will provide new opportunities for commercial aircraft MRO providers.

Lufthansa Technik has also in 2013 and early 2014 either entered into, or renewed, aircraft service contracts with Malaysia, India and Sri Lanka and Pakistan. These non-EU companies are clearly intended to provide capacity and services at lower cost than Lufthansa’s main bases in the EU and will help cater for the rapid growth of the aviation industry outside the EU.

The events giving rise to the redundancies in Lufthansa Technik Airmotive Ireland Ltd are the closure of the enterprise and the dismissal of the entire workforce.

The application relates to 148 workers made redundant in Lufthansa Technik Airmotive Ireland Ltd and 1 worker made redundant in 1 supplier of the primary enterprise during the same reference period of four months, from 1 March to 30 June 2014.

Basis of the Irish application : the Irish authorities submitted the application under the intervention criteria of Article 4(2) of the EGF Regulation, derogating from the criteria of Article 4(1)(a), which requires at least 500 workers being made redundant or self-employed persons' activity ceasing, over a reference period of four months in an enterprise in a Member State, including workers made redundant by suppliers and downstream producers and/or self-employed persons whose activity has ceased.

Ireland has argued that exceptional circumstances prevail in this case, as the redundancies have a serious impact on employment and the local and regional economy. In addition to the workers already referred to, the eligible beneficiaries include 275 workers made redundant before or after the reference period of four months. The total number of eligible beneficiaries is therefore 424.

The Commission therefore proposes to mobilise the EGF for the amount of EUR 2 490 758 .

FINANCIAL IMPLICATIONS: having examined the application in respect of the conditions set out in Article 13(1) of the EGF Regulation, and having taken into account the number of targeted beneficiaries, the proposed actions and the estimated costs, the Commission proposes to mobilise the EGF for the amount of EUR 2 490 758, representing 60% of the total costs of the proposed actions, in order to provide a financial contribution for the application.

The proposed decision to mobilise the EGF will be taken jointly by the European Parliament and the Council, as laid down in point 13 of the Interinstitutional Agreement of 2 December 2013 between the European Parliament, the Council and the Commission on budgetary discipline, on cooperation in budgetary matters and on sound financial management.

At the same time as it presents this proposal for a decision to mobilise the EGF, the Commission will present to the European Parliament and to the Council a proposal for a transfer to the relevant budgetary line for the amount requested.

At the same time as it adopts this proposal for a decision to mobilise the EGF, the Commission will adopt a decision on a financial contribution, by means of an implementing act, which will enter into force on the date at which the European Parliament and the Council adopt the proposed decision to mobilise the EGF.

PURPOSE: to mobilise the European Globalisation Adjustment Fund (EGF) to assist Ireland following redundancies in its aircraft repair and installation services.

PROPOSED ACT: Decision of the European Parliament and of the Council.

CONTENT: Article 12 of Council Regulation (EU, Euratom) No 1311/2013 laying down the multiannual financial framework for the years 2014-2020 provides that the EGF shall not exceed a maximum annual amount of EUR 150 million (2011 prices) over and above the relevant headings of the financial framework.

The rules applicable to financial contributions from the European Globalisation Adjustment Fund (EGF) are laid down in Regulation (EU) No 1309/2013 of the European Parliament and of the Council on the European Globalisation Adjustment Fund (2014-2020) and repealing Regulation (EC) No 1927/2006 (the 'EGF Regulation').

In this context, the Commission examined the application for mobilisation of the EGF to assist Ireland and concluded the following:

Ireland: EGF/2014/016 IE/Lufthansa Technik : the Irish authorities submitted application EGF/2014/016 IE/Lufthansa Technik for a financial contribution from the EGF, following redundancies in Lufthansa Technik Airmotive Ireland Ltd (LTAI) and two of its suppliers in Ireland.

The Irish authorities submitted the application within 12 weeks of the date on which the intervention criteria set out below were met. The deadline expired on 6 February 2015.

In order to establish the link between the redundancies and major structural changes in world trade patterns due to globalisation, Ireland argues that the closure of the LTAI is a result of a serious shift in the EU trade in goods and services resulting from a technological shift towards the production of new generation aircraft and components; a shift in wider aircraft component production practices with resultant impacts on the market fundamentals of the underlying business model of LTAI and a shift in location of global aircraft production.

Over the last 20 years, the most popular aircraft types have evolved from largely allmetal, mechanical, electro-mechanical, hydraulic and pneumatic designs to increasing composite, metal/composite structures, fly-by-wire automated, fully computer-controlled aircraft.

With the arrival of further new generation types such as the B737 Max and A320 Neo, operators have moved to retire the older classic aircraft and to some extent the older versions of the new generation types.

The traditional business model of LTAI was based on a number of elements which have come under severe pressure as a result of changes in the world aircraft fleet profiles and resultant rapid decline of the aircraft models that formed the base of the LTAI portfolio. A driving force behind increases in global air travel growth has been the industrialisation of countries such as India and China. In Asia Pacific and the Middle East, ambitious construction plans for new international and domestic airports will provide new opportunities for commercial aircraft MRO providers.

Lufthansa Technik has also in 2013 and early 2014 either entered into, or renewed, aircraft service contracts with Malaysia, India and Sri Lanka and Pakistan. These non-EU companies are clearly intended to provide capacity and services at lower cost than Lufthansa’s main bases in the EU and will help cater for the rapid growth of the aviation industry outside the EU.

The events giving rise to the redundancies in Lufthansa Technik Airmotive Ireland Ltd are the closure of the enterprise and the dismissal of the entire workforce.

The application relates to 148 workers made redundant in Lufthansa Technik Airmotive Ireland Ltd and 1 worker made redundant in 1 supplier of the primary enterprise during the same reference period of four months, from 1 March to 30 June 2014.

Basis of the Irish application : the Irish authorities submitted the application under the intervention criteria of Article 4(2) of the EGF Regulation, derogating from the criteria of Article 4(1)(a), which requires at least 500 workers being made redundant or self-employed persons' activity ceasing, over a reference period of four months in an enterprise in a Member State, including workers made redundant by suppliers and downstream producers and/or self-employed persons whose activity has ceased.

Ireland has argued that exceptional circumstances prevail in this case, as the redundancies have a serious impact on employment and the local and regional economy. In addition to the workers already referred to, the eligible beneficiaries include 275 workers made redundant before or after the reference period of four months. The total number of eligible beneficiaries is therefore 424.

The Commission therefore proposes to mobilise the EGF for the amount of EUR 2 490 758 .

FINANCIAL IMPLICATIONS: having examined the application in respect of the conditions set out in Article 13(1) of the EGF Regulation, and having taken into account the number of targeted beneficiaries, the proposed actions and the estimated costs, the Commission proposes to mobilise the EGF for the amount of EUR 2 490 758, representing 60% of the total costs of the proposed actions, in order to provide a financial contribution for the application.

The proposed decision to mobilise the EGF will be taken jointly by the European Parliament and the Council, as laid down in point 13 of the Interinstitutional Agreement of 2 December 2013 between the European Parliament, the Council and the Commission on budgetary discipline, on cooperation in budgetary matters and on sound financial management.

At the same time as it presents this proposal for a decision to mobilise the EGF, the Commission will present to the European Parliament and to the Council a proposal for a transfer to the relevant budgetary line for the amount requested.

At the same time as it adopts this proposal for a decision to mobilise the EGF, the Commission will adopt a decision on a financial contribution, by means of an implementing act, which will enter into force on the date at which the European Parliament and the Council adopt the proposed decision to mobilise the EGF.