European Semester spring package: Competitiveness and strategic autonomy should not be built on the back of Social Europe

On June 4, the European Commission released its 2026 Spring Package. It opens by stating that, at a time of major geopolitical shifts and tensions, the EU needs to continue strengthening its competitiveness and strategic autonomy to sustain its economic and social resilience and cohesion.

Social resilience and cohesion are presented as end goals, yet the Package treats them as costs to be traded and contained. The Competitiveness Compass governs this Semester cycle, social fairness trails at the end of the priority list, and fundamental social rights are invoked as an afterthought rather than forming its foundations.

For CESI, economic competitiveness and a social Europe are mutually reinforcing goals and cannot be traded against each other. Europe’s productive capacity depends on quality public services, well-trained and fairly paid workers, social stability, fair labour markets and high levels of social protection.

The Package’s fiscal architecture is telling. Defense enjoys every flexibility the framework can offer. Seventeen Member States have activated the national escape clause for up to 1.5 percent of GDP, SAFE channels up to 150 billion euro in loans, and the escape clause may now be broadened to energy security. Cohesion policy has meanwhile redirected 11.9 billion euros to defense and dual use investment, more than three times what the midterm review reprogrammed towards housing.

No comparable flexibility exists for social investment, which instead becomes the playing field for fiscal consolidation. In the country specific recommendations this translates into stepped up spending reviews, sustainability reforms in health and long-term care and a higher effective retirement age across a series of Member States.

In CESI’s view, security investments must not come at the expense of social cohesion, public services or long-standing Union policies, and should above all be covered by additional own resources.

The Package's treatment of revenue collection falls short of what honouring those obligations would actually require. It concedes that over 100 billion euro is lost annually to tax non-compliance and that progress on aggressive tax planning remains weak, yet its remedy is digitalised collection and broadened bases. Moreover, modernising and streamlining tax systems must lead to more efficient, progressive and socially just fiscal policies, with adequate taxation of multinationals and serious cross-border action and cooperation against tax evasion and avoidance. Broadening the tax base must not become a euphemism for higher VAT on working households, and the financing of Europe’s priorities must not fall disproportionately on workers.

The Package also champions digital public services and regulatory simplification. CESI recalls that a rulebook on digital public services already exists. The 2022 Framework Agreement on Digitalisation in Central Government Administrations foresees human controlled digitalisation including AI, protection against undue surveillance and trade union involvement in digital change. CESI calls on the Commission to build on this landmark agreement in shaping digital public services. CESI believes that regulatory simplification must not come at the expense of workers’ protection, and social partners belong at the table when rules are being rewritten.

The announced Fair Labour Mobility Package, with a Skills Portability Initiative, a European Social Security Pass and a strengthened European Labour Authority (ELA), addresses problems CESI has documented. CESI welcomes it under the following conditions: Skills recognition procedures must support quality employment and never be used to lower qualification requirements or occupational safety standards nor professional protections; ESSPASS must remain worker centered and accompanied by accessible human support services, multilingual guidance and non-digital alternatives where necessary; and ELA inspections must protect workers in sectors characterised by high level of labour mobility, temporary or seasonal work, subcontracting chains, labour shortages, high psychosocial risk, and elevated risk of exploitation.

The Quality Jobs Act will be the real test of whether Europe’s competitiveness and strategic autonomy are underpinned by high-quality employment, fair working conditions and strong workers’ rights, as CESI has stressed.

On social fairness, the Anti-Poverty Strategy, the reinforced Child Guarantee and the recommendations on minimum income and access to services point in the right direction. Yet services of general interest, health, education and social protection floors are precisely what the Package’s fiscal logic puts under pressure. Housing is the starkest case. The Package is silent on the systemic financialisation of housing, which has turned housing into an instrument of wealth accumulation, and addresses only the supply side of the problem, as a bottleneck of permits and procedures. While faster permit matter, housing must be treated as a social good through taxation, regulation and planning. Policy measures should address the shortages of affordable and social housing and tackle the speculative demand side too. CESI Youth has set the benchmark here: a European Housing Guarantee under which nobody spends more than 30 percent of income on adequate housing, large scale investment in social and not for profit housing, stronger tenant protection and tax rules that discourage speculation and vacancy.

Finally, on social cohesion, the Package reports persistent regional disparities and invokes the right to stay, while cohesion money flows to defense at more than three times the rate it is reprogrammed to housing. According to CESI. economic, social and territorial cohesion is a core foundation of European integration, not a flexible reserve for the priority of the day.

The choice before the Union is not between competitiveness and social justice, between security and cohesion. It never was. That is why CESI advocates a balanced approach built on fundamental social rights, one that pursues competitiveness, security, sustainability and social justice together. It must be financed fairly, through progressive taxation and genuine own resources, and shaped with social partners at the table. This is the only path to lasting prosperity and public support for the European project. Workers are entitled to a European Semester that treats their rights not as a cost of competitiveness but as its purpose.

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