Better quality of life and new employment opportunities

IF – 04/2023

On 17 April, the European Parliament voted on parts of the "Fit for 55" package including the results of the negotiations on the Social Climate Fund (SCF) in Strasbourg. The final report has now been adopted by a majority. In March, the German Social Insurance European Representation (DSV) reported about the discussions in the committees of the European Parliaments.

Wishful thinking

The Parliament is now paving a way towards more climate neutrality in Europe by 2050. Efficient climate protection, more reform investments by European companies and direct support for citizens shall lead to a better quality of life. This would result in more employment opportunities for citizens in the EU.

Highly remunerative fund

The Social Climate Fund (SCF) is established for the period 2026-2032. In the first year, it will be financed by revenues from the auctioning of allowances from the existing Emissions Trading Scheme (ETS), estimated at around four billion euros. Once the new ETS enters into force in 2027, the SCF will be financed by auctioning ETS allowances up to an amount of EUR 65 billion, with a further 25 per cent covered by national funds.

Climate protection with social justice

The newly created SCF, with 86 billion Euro in support, is intended to reach EU citizens directly. The fund is linked to the new ETS by also including emissions from buildings and road transport now. To counter the risk of rising energy prices, ambitious measures and funding are planned for vulnerable households, transport users as well as micro-enterprises that are disproportionately affected by the clean energy transition. Only with social justice in each new initiative will the EU be able to be more resilient to various threats and crises. Environmental justice must be ensured across Europe to benefit disadvantaged regions that are severely affected by pollution and climate change.

Green social protection systems at national level

The SCF aims to provide access to affordable, sustainable transport and energy for all. In the debate, Members of Parliament (MEPs) call on the European Commission and EU Member States to build the SCF and develop green social protection systems at national level. This could strengthen social resilience to the impacts of climate change and environmental degradation. Optimisation of health protection for people affected by climate change and unemployment protection for workers who lose their jobs due to extreme climatic conditions or as a result of the closure of carbon-intensive industries shall be supported by the fund.