The FINANCIAL — Brussels, 11 July 2011- The European Commission has approved an application from France for assistance from the European Globalisation Adjustment Fund (EGF).
The € 24 493 525 was requested by the French authorities to help 3,582 workers made redundant by Renault – and seven of its subsidiaries and downstream producers – back into work. The application will now be sent to the European Parliament and the Council of the European Union (the EU's Budgetary Authority) for decision.
"The financial crisis led to an economic slow-down which has hit the car industry particularly badly, said László Andor, EU Commissioner for Employment, Social Affairs and Inclusion, "Car production in Europe has dropped dramatically and its workers are still experiencing hardship. I am confident that the support and training provided through the EGF makes the former workers' transition to a new job easier”.
The French application relates to 4,445 workers made redundant by Renault and seven of its suppliers and downstream producers. The dismissals were a consequence of the financial and economic crisis. Renault suffered from the increasing cost of credit and the hardening of credit conditions from 2008 onwards. This seriously affected the company's ability to fund its own activities in the short-term, as well as its investment plans. It created insecurity about jobs, leading to buyers putting off any decision to purchase a car. Despite temporary measures such as scrappage schemes introduced by some Member States, the registration of new Renault cars in Europe dropped by 6.5 % between 2007 and 2008. During the fourth quarter of 2008 this downward trend accelerated and, in December 2008, the registration of new cars dropped by 27.5 % compared to the same time the previous year.
The regions most affected by the redundancies are Ile-de-France, Haute-Normandie and Nord-Pas-de-Calais. In Ile-de-France the redundancies mainly took place in the Guyancourt Aubevoie plant, Renault's headquarters. In the Haute-Normandie region, the job losses occurred in Cléon near Rouen and Sandouville, close to Le Havre. Le Havre in particular has suffered dramatic industrial decline with few opportunities for the job-seekers. In Nord-Pas-de-Calais, the redundancies mainly took place in Douai and Maubeuge. Both towns are located in areas with high unemployment (13.8 % and 15.5 %).
The financial assistance from the EGF is targeted at the 3,582 most disadvantaged workers to help them find a job by providing advisory services (guidance on job search, advice on business start-up, etc); training and re-training; support for business creation and allowances.
The total estimated cost of the package is € 37.6 million, of which the European Union will provide EGF assistance of € 24.4 million.
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