The Directorate-General for Internal Market, Industry, Entrepreneurship and SMEs (DG Grow) has scrapped the unit responsible for social economy (SE) and social entrepreneurship – a move attacked by social economy actors, including co-operative apexes.
A directorate-general of the European Commission, DG Grow focuses on upholding and managing the EU’s single market.
The European Commission’s Expert Group on the Social Economy and Social Enterprises (Geces) members criticised the decision, adding that they were neither consulted nor informed in advance about it.
In response, Geces members signed a joint statement, sounding their alarm about the move.
“Dismantling this unit will see the institutional knowledge built up over the last decade lost,” reads the statement. The members said they found it “alarming” that “some funds supporting SE actors Cosme were suddenly cancelled, raising substantial concerns for the ecosystem.”
The statement argues the decision “makes neither economic nor administrative sense”, adding that the social economy has over four million enterprises and organisations directly employing over 11 million people and a turnover of nearly €1tn.
Geces members also point to the sector’s role in integrating economic, social, and environmental objectives, prioritising social goals over profit, reinvesting earnings into the social objectives, and operating with democratic governance.
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The statement warns that the dismantling of the DG Grow social economy unit will have far-reaching consequences, undermining the progress achieved and stalling future advances.
The decision means that the sector will now be solely under the responsibility of the Directorate-General for Employment, Social Affairs and Inclusion (DG EMPL), headed by Commissioner Roxana Mînzatu, who has a mandate to support the SE. Until now, DG Grow and DG EMPL have worked together to deploy the SE in their respective activities and policies.
The statement’s signatories believe confining responsibility to DG EMPL is “inadequate” since issues like public procurement require continued involvement from DG Grow.
Geces members also warn that the social economy should be viewed through multiple lenses, not only social and labour policies but also entrepreneurship, industrial strategy, and broader transitions. As such, they argue that separating the economic and industrial dimension from its social mission undermines the impact of SE, which plays a critical role in advancing industrial autonomy, competitiveness, and territorial resilience. Geces also fears that the unit’s removal weakens cross-sector collaboration.
“Disbanding the SE Unit within DG Grow is a major mistake, there will be no one left dealing with the Single Market to oversee initiatives and policies that impact on the SE,” adds the statement.
“Not only does it weaken the understanding of SE, it impedes a coherent approach to SE in economic policies, and will end DG Grow’s initiatives to enable SE businesses access markets and supports on an equal basis with the private for-profit sector.
“This cut will result in fewer human and financial resources and expertise for SE businesses within the Commission. In fact important funding for SE has abruptly been stopped last week, with no explanation.”
The letter calls on the European Commission to maintain strong institutional support for the social economy across DGs, especially in implementing key EU initiatives like the Social Economy Action Plan and the Transition Pathway.
The statement reaffirms Geces members’ commitment to advancing the SE as a central pillar of Europe’s development strategy, concluding with a request for a meeting with the responsible Commissioner to reaffirm support and chart a path forward.
The statement has so far been signed by 236 individuals representing social economy apexes from the European Union, including 47 co-operative organisations.
Those wishing to add their name to the letter, hosted on Social Economy Europe’s website, can do so using this link.
