Economy

EU aid worth €700,000 to support 632 dismissed workers in Belgium

Published

2 years ago

November 29, 2024

Support for 632 former workers from machinery and paper enterprises Purmo and Sappi in the Flemish province of Limburg.

Many of the redundancies involve lower-skilled workers aged 50 years and older.

Financial support package includes counselling and vocational orientation, job search assistance, as well as skills training.

632 employees of the machinery and paper enterprises Purmo and Sappi who lost their jobs should receive €700,000 in EU aid.

The Committee on Budgets approved Belgium’s request for €704,135 in EU aid through the European Globalization Adjustment Fund for Displaced Workers (EGF). The aid will support 632 former workers from machinery and paper enterprises Purmo and Sappi in the Flemish province of Limburg. MEPs noted that the profiles of the displaced workers, one third of which are aged 55 years or more and 30 % are with low education, translate into severe barriers on the labour market.

Both Sappi Lanaken and Purmo Group had to lay off employees due to declining demand for their products and economic challenges. Sappi Lanaken closed its plant because digitalization reduced the need for woodfree coated paper and shifting production was too costly, while Purmo Group's Zonhoven plant ceased production due to a 60% drop in panel radiator demand, higher operational costs, and unfavourable market conditions influenced by the war in Ukraine and EU legislation favouring alternative heating systems.

The EGF funding will help pay for counselling and vocational orientation, job search assistance, as well as skills training in vocational, digital and language skills. The total estimated cost of these measures is €1.2 million, with 60% (€700,000) covered by the EGF and the remaining 40% (€500,000) financed by the Flemish Employment and Vocational Training Service (VDAB).

Next steps

The draft report by rapporteur Matjaž Nemec (S&D, Slovenia) recommending that Parliament approve the aid was approved by 29 votes, 1 against and no abstentions. Approval by plenary is expected during the upcoming 16-19 December plenary session in Strasbourg.

Background

Under the EGF regulation 2021-2027, the Fund supports displaced workers and self-employed people who have lost their activity due to unexpected major restructuring events. Since 2007, the EGF has allocated €696 million in 180 cases, providing help to more than 169,000 people in 20 member states. EGF-supported measures complement national active labour market measures.