11
EU in order to maintain the possibility for different national conceptions of organising old-age
31
security systems to exist.
In contrast to the conventional legal tools of the EU (e.g. regulations and directives) the OMC
represents an instrument without legal binding (i.e. soft-law). Altogether, the OMC remains not
binding with regard to aspects of legal competence, decision relevance and finance. The OMC is
not supposed to establish legal sanctions on irregular policy. It rather aims at a process of bench-
marking, the determination of best-practice, and to promote a continuous process of learning-by-
seeing. Concerning this aspect it has to be noticed that several scientists and administration offi-
cials point out, that the OMC in the social policy area is not only influenced by the employment
area, but by the co-ordination rules of the EMU as well.32 It has to be mentioned in this context
that the OMC regarding social policy is based on a soft approach - and this differs from the hard
EMU approach. The latter is based upon the Treaty of Amsterdam and the SGP, which includes
sanction mechanisms. In the social policy area there is nothing alike yet.
Nevertheless, should the OMC be continuously developed accordingly, and in case the OMC
turns out to be an instrument to put into practice the formulated European broad common objec-
tives33, this (non-binding) process could cause peer-pressure even without sanction mechanisms.34
This peer-pressure could become the more intensive the bigger the differences between an exist-
ing old-age security system of a particular member state, and the conceptions formulated within
the OMC framework respectively the best-practice. In view of that, to sum up, the OMC repre-
sents a new type of policy making and regulation: on the one hand, it is softer than the classical
legislative approach, but on the other hand it implies more than simple non-binding recommenda-
tions or political declarations even without sanction mechanisms.35 Keeping these facts in mind,
let us have a closer look on the role of European institutions and policy committees related to old-
age security.
31
32
33
34
35
In detail, the Commission of the European Communities (2000: 13) pointed out that “member States [have]
to decide what pension system they want and what policy mix is required to maintain adequate incomes for
older people without jeopardising the stability of public finances, undermining employment incentives or
squeezing out other essential public expenditures.” For these aspects see Council of the European Union
(2001: 2) as well.
For this aspect see the extensive comments in Verband Deutscher Rentenversicherungstrager (2002) and
Devetzi / Schmitt (2002: 236) as well as Hodson / Maher (2001: 720 ff.). It is mentioned that this process is
inspired by the experiences of the Luxembourg-Process and the ESS, which has been institutionalised by
the Treaty of Amsterdam in 1999. Nevertheless, it is important to notice that the process of OMC as a
whole is not embodied in the Treaty of Amsterdam yet. Furthermore, there is no explicit reference to it in
the articles of the Treaty of Nice. On the other hand, Hauser (2002: 252) and Schulte (2002: 19) as well
stated that the new article 137 of the Treaty of Nice describes a method that - according to their interpreta-
tion - shows similarities to the OMC.
The formulated European broad common objectives will be described in part 3.2.
Cf. Streeck (1996: 77 ff.), who called this kind of governance ‘neo-voluntarism’. Especially governance by
persuasion, e.g. due to recommendation, expertise, explication and consultation, shows similarities to the
OMC.
For comments on these issues see Scharpf (2000: 22 ff.) as well as Gesellschaft für Versicherungswissen-
schaft und -gestaltung e.V. (2001: 11 f.) and Schulte (2002: 23 f.).