Estonia to apply for EU fund support for laid-off VKG workers (1)

A VKG refinery in Kohta-Järve. (Tairo Lutter/Postimees/Scanpix)
BNS
2/27/2016 2:27 PM
Category: Economy

The Ministry of Social Affairs is passing around a possible bill that would allow Estonia to apply for support with the European Globalization Adjustment Fund (EGF) in connection with large-scale layoffs at the shale oil producer Viru Keemia Grupp.

Two ministries as well as the Innove foundation would be able to apply for and manage funds from the EU fund. The Ministry of Social Affairs would apply for funding, the Finance Ministry would audit the procedure, and Innove would control the distribution and use of the funds, the bill states.

Minister of Health and Labour Jevgeni Ossinovski, who distributed the bill to the other ministries, asked for opinions and endorsements as soon as possible, noting that up to 445 workers will be made redundant in three companies belonging to Viru Keemia Grupp (VKG) between March and May this year, and that support from the EGF could be sought only within a limited timeframe.

Furthermore, the domestic support management and control system needed to be in place before submitting the application to the European Commission, so shortening the deadline for opinions on the bill was justified, Ossinovski said. He said he expected answers in a week's time, by 4 March.

VKG announced massive layoffs in mid-January. Ossinovski announced on the same day that Estonia was considering the possibility of applying for support from the EGF.

The fund is a special financial instrument outside the EU's multiannual financial framework. Its maximum annual budget in the 2014-2020 period is €150m. It provides support to people losing their jobs as a result of redundancies, not to companies. It co-finances only active labor market measures aimed at helping workers find a new job.

Editor: Dario Cavegn

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