The purpose of part II is to critically assess the development and outcomes of key European procedures and initiatives in employment and social affairs: the European Employment Strategy (EES), the European structural funds, European Social Dialogue and the Open Method of Co-ordination (OMC). The benchmark is their capacity to reform themselves, first by overcoming the emerging difficulties they often contributed to create, second by dealing with new objectives in relation with the future of Social Europe. From a ‘cooperative growth strategy’, as advocated in the 1994 Delors White Paper, EES has degenerated into employability and activation policies at the expense of a capability approach (Gilles Raveaud, chapter 8). The European structural funds, although promoting a catching up between countries, have failed to correct imbalances at regional level. This calls for more ambitious mechanisms for redistribution, redesigned to deal with inequality of regional capabilities (Jacky Fayolle and Anne Lécuyer, chapter 9). Emmanuel Julien and Jean Lapeyre – social actors, respectively, on the employer (UIECE) and on the union side (ETUC) – argue in chapters 10 and 11 for a greater degree of autonomy and innovation in the agenda and processes of European social dialogue which, they say, should be less constrained by the Commission's strategy. Seen in the light of the principle of subsidiarity, the OMC, however, develops other political lines. Its impact on European governance, especially on European social dialogue, remains unclear, depending on the scenarios that actors come to adopt in the future (Philippe Pochet, chapter 12).