Why a fifth freedom is needed for a new internal market.

The European Parliament's Committee on Employment and Social Affairs (EMPL) met with Enrico Letta, the former Prime Minister of Italy, at the beginning of the new year to discuss the social dimension of his “Much more than a market” report. The report was commissioned by the EC and compiled by Mr. Letta. It highlighted the crucial importance of the internal market for dealing with Europe's major problems. Letta argued in favour of deepening and expanding it from economic, political, and social perspectives. His proposals focused on supporting the triple transition: digital, fair, and green. During the committee meeting, he made a particularly powerful plea for a strong social dimension in the internal market that is in line with the values of the European Pillar of Social Rights. He also spoke in favour of introducing a fifth freedom to define the European internal market.

The importance of social cohesion

The Letta report advocates stronger integration of the social dimension into EU policy in order to strengthen the legitimacy of the EU and harmonise economic and social objectives. The report highlighted the importance of social cohesion and social insurance. It also highlighted the central role played by an effective social protection system. Social investments are considered to be just as important as investments in development, infrastructure, and research. The same applies to employment protection. The Letta report advocates the strengthening of the European Labour Authority (ELA) as well as further developing strategies for health and safety in the workplace.

Digital, fair and green changes

The focus of Latvia's proposals is on shaping the European future as digital, fair and green. The report highlighted the need for an integrative approach that will combine environmental, social and technological objectives that can ensure sustainable growth and social justice. The internal market's structures must be adapted to meet this so that Europe's innovative capability can be strengthened, and sufficient private capital can be mobilised for the necessary investments alongside public sector capital. Letta sees these investments as including education, further training and investments in the people's ability to work and their health.

The fifth freedom

During the discussion, Letta emphasised that the four freedoms on which the European internal market is based are no longer sufficient to meet current and future challenges. The existing four freedoms - the free movement of capital, goods, people and services - should be supplemented by a fifth freedom for education, innovation and research.

Letta is also referring to the former President of the EC, Jacques Delors, here. Delors had previously considered a fifth freedom for education, innovation and research. During his speech, Letta emphasised that the European internal market, which is based on the four freedoms, is essentially based on theoretical principles from the 20th century. However, the distinction between goods and services is becoming increasingly blurred, and the intangible aspects of the digital economy and the opportunities and risks associated with the circular economy are not being recognised. According to Letta, Europe must create structures to protect intellectual property and simultaneously transform these assets into innovations and flourishing industries. Therefore, new fifth freedom for education, innovation and research is needed.