Madame President, Honourable Members,
I am really honoured and happy to be here, honourable Members. It is also wonderful to be here in person, even with these restrictions. To see you present here, because it is a first sign that we are slowly recovering from the pandemic and slowly going back to business as usual. And I have to say, I would have never thought a year ago that I would be craving for what Bruce Springsteen calls ‘a human touch’, but we really are in need of meeting each other again and discussing many things.
The challenges we face are daunting - in the next months and years we will have to confront the real cost of the pandemic, both when it comes to our economy as well as restoring fairness and equality in our societies. One issue I would explicitly want to mention is what this has done to woman and girls across the European Union. Very often frontline workers, but also, sadly again, increased victims of gender-based violence. This has put society on edge. The most vulnerable in society have paid the highest price. Women, girls, but also minorities across the European Union, and people in vulnerable social and economic situations. Given the role of this institution, I think it is important that we discuss those things
You represent all voices in society -businesses, workers, civil society. And we need to discuss it with you. We need to zoom in on a topic that is very close to my heart: how to make the European Green Deal a just and social deal. Very simple, the European Green Deal is going to be just, or there is just not going to be a European Green Deal.
The need to take climate action
I would like to start by thanking you and this institution for the support for our increased climate ambitions for 2030. I think it is quite an achievement. The European Economic and Social Committee is, as I said, a microcosm of wider European society. If the debate here is along those lines, I am sure it reflects the situation in our society. Also with different interests, taking different positions and then coming to joint conclusions. That is the strength of the European Social model. So what you show here is, even with these different interests, all those voices can point to the same direction: the urgent need to act against the twin crises of the climate crisis and biodiversity crisis.
We at the Commission share this feeling of urgency. Despite the Covid crisis, the call from citizens to take action against these twin crises hasn’t gone away. Citizens sense that this is needed if we want avoid dangerous tipping points for nature and our world. They also know that the cost of non-acting, to see those tipping points spiral out of control, will dwarf the cost of doing something about it now, because very often we only talk about the costs of transition, but we should compare it to the cost of non-transition, which both in human terms and financial terms is much higher. That is why our two institutions support a green recovery, to avoid the ‘pound smart, penny foolish’ approach to rebuild whilst restoring the economy of the past.
We will be mobilising 1.8 trillion euros in the coming seven years. If we don’t spend them well, what is the legacy we leave for our children and grandchildren? How big will the debt be, how big will the unsustainable debt be they will be left with in an economy that doesn’t meet the demand of the future?
So we better get this right. We better get this right in the decisions that we’ll be taking in the upcoming years. They could have a huge influence on the livelihood and lives of our children and grandchildren. I can only compare it to what happened on our continent after the end of the Second World War where our grandparents were also called upon rebuilding Europe. They did not do it for themselves, but they did it for our children and grandchildren and we need to rekindle that feeling that now it’s up to us to do something not for ourselves mainly, but mainly for our children and grandchildren.
Climate action is socially fair
The first ones to suffer from the climate and biodiversity crises are vulnerable households. Small farmers who already struggle to get a fair price for their produce would face huge difficulties with increased droughts and freak weather events. They’ve kept us all fed, and fed well, during the pandemic. But there is no vaccine against droughts, against firestorms, against real changes in our natural environment, against the disappearance of more than 1 million species, pollinators, and more.
So by tackling climate change and biodiversity loss together, we deliver a better world for all.
But we should not close our eyes to reality. Whilst the destination of a sustainable and fair society may be clear, the pathway to get there will be tough and very hard work. Don’t create the illusion with people that it’s going to be easy. If you tell them it’s going to be easy now, they will be disappointed later. Better prepare them for what is going to be a tough transition. We need everyone to come along, we need everyone to do their part.
Today, I renew my pledge that we will pursue an inclusive Green Deal, as it’s the only way to have a Green Deal. On the 14th of July, we will come with a big package of climate proposals, the Fit for 55 package.
We will hardwire social fairness in these proposals. We will do it in two ways. First, throughout our proposals, we will share the burden of taking climate action in a fair way between industries, governments and citizens. Second, a lot has been said in recent weeks about the possibility that we extend emissions trading to heating and transport fuels, to put a carbon price on them. The electricity that we use is already part of that trading, and we need a stronger incentive for other fuels to bring down emissions.
So the climate rationale is clear, and logical. The social rationale, by contrast, may not be as clear, at least not immediately. But rest assured, if we do take this step and if households face growing costs as a result, we will ensure that a social mechanism, a climate action social fund, is in place that can compensate for any possible adverse effects, especially for our most vulnerable citizens.
I will get back to this last point because we are seriously working on proposals for that.
Inclusive Green Deal and Climate Action Social Fund
First about the inclusivity of the European Green Deal. As your Committee has shown the European Green Deal is about doing things together - about everyone playing their fair part. Just like we cannot afford to leave anyone behind, we cannot allow one sector, one company, or one region to freeride. Such a freeride would be a ride over a cliff edge – and that is exactly what we want to avoid.
That’s why in our package due on 14th of July, we will propose to share the burden in a fair way. We will push industries to innovate and bring citizens affordable clean solutions, for example by tightening the emissions trading system for industry, setting targets for the supply of renewable energy and targets for more electric vehicles to come to the market. If it comes to helping citizens to insulate their homes, we will double down on our Renovation Wave - our plan to assist households across Europe in renovating their houses, and to help neighbourhoods to make their schools and hospitals more energy efficient and bring down energy bills as a result.
Over time, clean energy in our homes and electric cars will become cheaper and allow citizens to save on fuel cost. But therein lies the challenge: this will happen over time. These clean options won’t be available at the same time to everyone, everywhere.
Before these options become cheaper, we must protect vulnerable households against potential price increases for heating and transport fuels, especially in regions where clean options aren’t readily available. It is quite a difference whether you live in a very urbanised environment or in a more rural environment. These aspects have a hugely impact on the way you live. So if we were to introduce emissions trading for these fuels, that means we must also take our commitment to social fairness a step further. Any proposal on emissions trading in these new sectors, must come with a proposal for the social impact at the same time.
Part of the revenues generated from emissions trading in road transport and buildings could be put into a dedicated fund, so that Member States can use those revenues to compensate the cost of this transition to vulnerable citizens. If they receive financial assistance, they could be enabled to make the switch to clean alternatives like zero emission heating and cooling, or electric cars and then experience the financial benefits of that switch sooner as well.
Just to give you the electric cars as an example, they are already cheaper to run today than a traditional combustion engine car, but not cheaper to buy. But in 6 to 7 years time, according to Bloomberg, they are also going to be cheaper to buy. It’s a good example of how this transition in a short run might be difficult to grasp, but in a long run just makes a lot of sense.
It has been and will remain the European Commission’s commitment – as well as my personal commitment – to make the European Green Deal a fair deal. The just transition must become a reality for there to be any transition at all. I think you will see on the 14th of July how we plan to live up to this commitment.
Of course, we must also make the social pillar of our actions count in the supply chain, for all the workers in the mines, the farmers on the peatlands and the employees in the industry value chains that will undergo a big transformation on their way to a climate neutral future.
Again here, we always say there is 2 million more jobs in the new economy. But you have to add to that, that there is also going to be a huge amount of jobs that are going to be disappearing with the old economy. We need to make sure that the people who are in the old economy have the opportunity to switch to the new economy. That is a huge transformational issue. We are in a good position, demographically as Europe, to do this in a right way.
I am a child of the transformation in my own home region. We went away from coal at a time where we were also in an energy crisis and economic crisis. The region actually never really recovered. Whereas now we have a different opportunity, we have huge opportunities in the new economy. The demographics are working for us. In some of the countries where coal is still dominant, unemployment is only 3 percent. If we do this right, if we organise this right, if we do it with the full involvement of social partners, we could really get this right, this time.
So on all these issues, honourable members, the Commission, my colleagues, Schmit, Breton, Vestager, Dombrovskis, we all work on this – The Energy Commissioner, the Agricultural Commissioner, everybody is working with the same goal.
I hope we can continue our own cooperation, which I see as very important and fruitful. I want to thank you once again for your commitments to build a climate neutral and clean future for next generations.
We have the skills, funds, and brains to deliver on this green recovery and our European Green Deal. I look forward to the discussion on your ideas to make that happen.
Thank you very much, Madame President.
Closing remarks EESC
Thank you very much. I will try and answer your questions and reflect on your remarks. My colleague and I have taken careful note of all that's been said and I'm sure we'll get an occasion to come back, so if I miss one or two or even more of your comments and you want to come back to me, I'm at your disposal at a later point. Especially once we have presented our plans in July and I'm sure at the latter part of this year we will have ample opportunity to reflect on some of these elements.
Let me start by saying that obviously the global perspective is of huge importance, given the fact that Europe is responsible for about 8% of emissions. If we only move towards climate neutrality in Europe, we would not achieve very much for the planet as a whole. But when we started out on the European Green Deal, with our ambition to be the first climate neutral continent 2050, it was still pretty lonely out there.
A lot has changed in the last year and a half, notably the change of government in the United States. A new commitment to the same goal, a new ambition also to have a successful COP in Glasgow in November. We've seen a Green Alliance we've entered into with Japan. Japan is also committing to climate neutrality by 2050, and the same is happening in South Korea and Canada. I was talking to my colleague from New Zealand this morning. In China: carbon neutrality by 2060.
This is becoming a global net zero movement. Not because they all believe that we did such a brilliant job and they think ‘well these Europeans know what they're doing, we will do the same.’ No, because science telling them to do this. Science is telling them to do this. The climate crisis is upon us. It's happening. We have the droughts, the wildfires. We have the Gota Fría in Spain, which used to happen once every 50 years, and is now almost happening every year. It's happening and there's no denying. That’s the reason why we need to act.
When we talk about the social dimension, obviously it's not just about work, it's about all the aspects of the social dimension: education, healthcare, participation in society, and pensions, obviously. All these elements play a role, and all of them need to be made sustainable, which can only happen if we make the transition to a sustainable economy quicker than before. That part of the world is going to be the first to transit into a sustainable economy, a circular economy no longer dependent on fossil fuels. It is also going to be the continent with the highest level of growth, with the highest level of social cohesion. These are all interlinked.
That's why your work is so incredibly important. That we see the interlinkages and act upon it. It is true that there will be no Green Deal without a social deal, but turn it around: you have no social deal, no Green Deal, and then what happens? Who are then going to be the biggest victims of non-action? Of course we need to make sure that this is done in an equitable way and that we protect people who are most vulnerable, that's why we are proposing these measures to look to the social side.
But if the climate crisis gets out of hand, people who have money, rich people, they can move to higher places, to healthier places. People with ordinary jobs or without a job, they have nowhere to go. They will suffer the worst consequences, so please keep in mind when we talk about making this transition socially just, we need to keep in mind that if we don't make the transition, then social injustice will explode even more.
I think this is important to understand that's why there is no contradiction between social justice and economic growth. Sustainable growth, not the traditional growth, and innovation and all these elements are extremely important. There is no conflict on this point, I would say, between employers and trade unions. We're on the same page, we have the same interests.
Of course participation is of huge importance. I see this working on a daily basis in different industries where change is going to be huge. Look at the automotive industry, where only two years ago, a year and a half ago, we heard talking that ‘they were never going to make the emissions norms for 2021’, ‘that we would have to impose huge fines’, and ‘that the Member States would will be all over us to prevent us from actually opposing those fines’. And that then the whole thing would come crumbling down.
But they made it. The automotive industry was able to make it. And they've also turned the corner. They know that electric vehicles have the future and they know that insisting on continuing with internal combustion engine for passenger cars and for vans is not the way forward. So you see changes happening. Look at the price development of renewable energy, you no longer need huge amounts of subsidies for offshore wind or for solar. It pays for itself. So we also have some really good developments in our economy and society and we should build on that.
We should also make sure that all the jobs that come with these new developments can be filled by people who would have to learn the skills to do those jobs. These are very often local jobs, these are very often jobs that can be sustained over a very long period of time. That's the future, I would say, of our labour market. But it will only happen if social partners are fully involved in all these discussions.
Social partners have the full measure, also on deciding of how we organize this. And this is a discussion about the full social model, about the nature of work, about the nature of employment, about the nature of protection in employment about the lifelong learning issue, about how you treat people who retire.
All of this is going to be of extreme importance, which brings me to the next point and that is the intergenerational issue we need to face and I can't say this enough: we had a level of solidarity of young Europeans over the last year and a half that is inspiring. Many young people ran very low risk in the pandemic. Still, they wore the masks, they stayed inside and did everything. They did not do it for themselves, they did it for us. Now it's time we repay that by showing our solidarity with their future. That's what the Green Deal is all about, that's why we need to do this. I spoke about debt before, but also about the degradation of our natural environment, of the opportunities they will have. Housing is a huge part for them, education is a huge part for them.
I was speaking earlier about low unemployment in some parts of Europe. I have to speak about the scourge of incredibly high youth unemployment at some other Member States. Sometimes half of our young people have no jobs, have no opportunity to find housing, have no opportunity to get a decent education. These are the things we need to fix, that have to be part of our Green Deal. They deserve it and we deserve it, because if we don't give them the skills they need in the economy of the future, we will lack the people to fill the jobs and then the jobs will leave Europe. It's that simple and that challenging at the same time.
So the industrial strategy we have developed and we're continuing to develop, is actually based on the knowledge that we are in twin transitions, we're in the middle of an industrial revolution right now and it's happening all across the world and it's happening at lightning speed. Europe can keep up with it, but only if we adapt, if we innovate. If we apply the new technology, if we invest in developing new technologies, if we use the right economies of scale in developing the technology, if we reach across borders.
Look at the potential of for instance green hydrogen across the European Union, who would have thought that possible a couple of years ago, and here we go. International partners want to be part of that; Europe leads the way. Thierry Breton’s idea of looking at sectors as ecosystems is working well for us, because it also means that we can involve with employees and trade unions on the basis of that ecosystem. What's going to happen in that industry, how are you involved, how can you play the full measure of your role, what is the outcome of this transformation. I think this is extremely important.
Participation is essential. I've spoken with the with Nicolas Schmit and the trade unions and employers last week. We will continue these dialogues also per sector. All my colleagues are very much engaged in this. We have a Climate Pact that will allow also participation of wider society into this. And we need to reinvent also new and innovative forms of social dialogue, not just on a national basis but also across borders, to show that everybody is involved.
On forests, I know this is a very topical issue, and I know this is an issue that leads to a lot of emotions. I would say we need to look for a virtuous triangle, which is: sustainable forests, economically viable forests, offering also a social basis for communities living off and in forests. That is what we need to reach. But we also have to be brutally honest about the fact that, although the forest coverage is going up, the health of our forests is going down. 75% of Europe’s forests are in a bad shape. Especially if you also address the issue of biodiversity loss. A forest is not just a bunch of trees put together. A forest is a full ecosystem and these ecosystems are suffering. Sometimes because of climate change, because you can't have the same vegetation. If one degree difference can make a huge difference for certain vegetations, it's affecting our forests. But biodiversity is also under huge strains, so we need a plan to reinvigorate the health of our forests. That's a long term plan, that's not something you do in 1, 10 or even 30 years. It's about decades and decades of sustainable forest management. We have some Member States with a lot of experience in this and we love to work with them on that. But these Member States should also embrace the issue that part of the solution needs to be protecting biodiversity. Biodiversity cannot be ignored in this and I hope we can work on that on that basis.
On the ETS reform, now I have to insist on this and very quickly Madame President, I know we're running out of time, but it's an important point. We've set in law that Europe wants to be climate neutral in 2050 and wants to reduce its emissions with at least 55% in comparison to our emissions in 1990. So we have nine years to take us from the initial goal, which was a reduction of 40%, to the new goal, which is a reduction of 55%. This is set in law.
Then you translate that into measures and that's what we will do when we present it on the 14th of July. If you don't like one measure, for instance, if you wouldn't like the potential extension of ETS to the built environment and transport, then you will have to tell us, if you don't like that, where are you going to get the results then? And how? The ETS has the effect of immediately influencing behavior. You see it in the industry already. The advantage of ETS is you can make money if you reduce your emissions. If you don't introduce ETS, but you introduce taxation or regulation that doesn't have that immediate effect on behavioral change. So you need to weigh the different options we have. You can't say ‘well if I don't like the options, then forget about the minus 55%.’ No. We've said that, and all Member States have subscribed to that.
If you don't like the elements, well then come with other elements and we'll talk about it. But the thing is, if we can organize it in a way that protects those who are vulnerable, then this is a goof way forward. And it it isn’t, we will find another way. But we can't just neglect the issue. We have to address it, it is extremely important. Industry can help here, because industry has experienced with ETS and actually, it's quite popular. The price has gone up and it leads to adaptation, sometimes difficult adaptation, but if we combine it with other measures such as the Carbon Border Adjustment Mechanism in sectors where it is needed, it could really help.
Fisheries was mentioned, and let me say that fisheries in some aspects is interesting, because the yearly discussion about taxing quota is actually telling the fishing industry that you need to live within the boundaries the oceans are setting. And if you don't respect the boundaries, the ocean is going to punish you by being depleted of the resources you need.
Actually, it's symbolic for what we need to do with climate crisis as well. This is the biggest task humanity has arguably ever had, especially in modern times: to learn to live within planetary boundaries. If we don't learn to live within planetary boundaries, and we have 10 billion people that all want to live like us in the future, the planet will not support us. But this is not about saving the planet, ladies and gentlemen, the planet is been around for more than 3 billion years without humanity and it could be around for another 3 billion years without us. This is about saving humanity, this is about giving humanity a place on the planet. I like the expression ‘if we attack nature, nature will fight back’. And that's exactly what's happening. So we really need to be fully aware of that.
On the issue on farming: we’re in the middle of negotiations now, with the Council and the European Parliament, on reforming the CAP. We need to reform the CAP. Look at what is happening, we’re overusing fertilizers, overusing pesticides, we're overmedicating animals and animal husbandry. It has it a horrible effect on biodiversity. There is a possibility to have a sustainable agriculture, I strongly believe in that. And yes, we will need to feed 10 billion people, that's a huge opportunity for the agricultural sector, but only when we can do it within planetary boundaries. It is possible with the latest technologies, with a different way of looking at what you reward farmers for, etcetera. It is all possible to do that. We need to start reforming the CAP. The Commission is very much on the line to try and find a compromise this month with the co-legislators to see that we can push the envelope towards a greener Common Agricultural Policy. And as Mr Healy knows very well, the USDA report has been analysed and found faulty on many aspects, but he knows that.
CBAM, the Carbon Border Adjustment Mechamism. It must be WTO conform, we want to make it like that, only for sectors where it is needed and only when it is needed. When is it needed? When other signatories of the Paris agreement do not take the decarbonising measures that we need to comply with the rules. Then we want a level playing field. We want to avoid carbon leakage from Europe, then we will need this instrument.
We need to reform our commercial policies. We're in the middle of doing that. I had, again with the climate minister of New Zealand, this morning a discussion about that things are really changing in international trade. But we will still need international trade. But we will need a different international trade. The idea that we could sort of create a fortress Europe and liberate ourselves with all the issues of trade, please don't fall into that trap. Our economy will depend also on international trade, even a sustainable economy. But it has to be a fairer trade, it has to be a trade where we create a level playing field, also for decarbonising our economy and making it healthier. And that's what we're working on with our international trading partners.
Deforestation is a huge issue in this, we have an incredible problem there and it's linked also to our consumption. It's linked to the way we produce. I want European consumers to see with labeling when they buy something that it’s been created with deforestation. But ideally, I just want us not to have products that lead to deforestation. Sometimes it's indirect. Animal feed, for instance. We have a huge problem in that. America, the Amazon, in central Africa and in Southeast Asia and we absolutely need to address it.
On the taxonomy very quickly. What is green is green and what isn't green isn't green, I can't change that. It's a scientific fact. Nuclear energy is very good in terms of having no emissions, but it ain't green. Natural gas is much better in terms of emissions than coal, but it ain't green. It's something that I can't change. Does that mean that there's not going to be investment in nuclear, not going to be investment in natural gas? Of course there's going to be investments there. But we can't say it's green.
You shouldn't overstate the case of taxonomy, but you should be clear about taxonomy. And on this, let me be very clear. Natural gas will be absolutely essential in the transition away from coal and wood to sustainable. We're not going to be able to help all our Member States to immediately go from what they're doing now, coal and wood, immediately to renewables. There has to be a transitional period and natural gas will play a role in that. If you make the investments in such a way that the network you create, the system you create is pre-fitted to then later on transport and distribute sustainable energy carries, such as hydrogen. Then you invest also in the future. But we have to avoid getting locked eternally into carbon fuels.
Madame President, I think I really overstayed my welcome now, let me stop immediately and I’m happy to be back at some point to continue our discussion, thank you very much.