Resumption of the session
President
I declare resumed the session of the European Parliament adjourned on 19 June 1998.

McCarthy
Mr President, I am sure you will be aware of today's very historic events. Following the Good Friday Agreement and just five weeks after the referendum the new Northern Ireland Assembly is meeting at the same time as we are. It is five minutes into its new programme. This is a historic day for Northern Ireland and given your interest and support for the peace process, would you, on behalf of all Members of Parliament, send a strong message of support for the implementation of the Good Friday Agreement, wishing all the elected members well in their work of building peace for the communities of Northern Ireland.

President
Mrs McCarthy, as you have said, this Parliament has always been supportive and this morning I sent a telegram to Mrs Marjorie Mowlam. It said: ' On the occasion of this first meeting today, please convey the best wishes of the European Parliament and my own personal best wishes to the new Northern Ireland Assembly. The European Parliament expresses continued solidarity with the people of Northern Ireland and its new assembly in the on-going process of peace and reconciliation' .

Banotti
Mr President, we all know of your full and warm-hearted support. Thank you for your good wishes and for sending the telegram this morning. Let us hope that in the next few days we will not see any breakdown of the current positive actions in Northern Ireland.
I raised a point at the last session on Parliament's budgetary problems following the judgment of the Court of Justice with the NGO networks working on social cohesion. There is serious and widespread alarm about this. I hope we may be able to get a statement from the Commission.

President
Mrs Banotti, if I may say so, you have anticipated the matter by about five minutes. We are just about to begin a debate on the matter with Mr Liikanen.

Günther
Mr President, I refer to Rule 151 of the Rules of the Procedure, which states that the meetings of the committees are open to the public. One of my visitors, who is a wheelchair user, experienced great difficulty getting into the D III building. May I ask you to ensure that disabled people have access to this building?

President
Thank you, Mrs Günther. We will look at it immediately.

Elmalan
Mr President, I would like to pay tribute to the memory of Lunes Matub, vilely assassinated in Algeria last Friday. Lunes Matub was a singer and spokesman for Kabylia and Berber culture as well as a symbol of the Algeria which is struggling and suffering. I have every sympathy with the emotion and anger of the Algerian people in the face of this dreadful act and their revulsion at the fundamentalism which has strengthened the hand of the assassins. Algeria is now suffering and fighting and I hope that the Algerian people and the Algerian government will be able to rapidly find solutions so that his situation can move forward.
I would like to end with the remark, as his mother declared with great dignity at his funeral, that while Matub may no longer be with us in person, his songs and poems will remain deep in our hearts for ever and his struggle for peace will continue.

Galeote Quecedo
Mr President, during the last mini-part-session here in Brussels we had about twenty councillors from the Basque country with us, and we had the opportunity of expressing our solidarity with them in their constant dedication to the fight for freedom and democracy. And during the next part-session, in Strasbourg, we shall also be inviting a party of Basque councillors. But there is one Basque councillor, Mr President, who will not be able to come back this time. I refer to Manuel Zamarreño, a councillor from Rentería. He was an unemployed workman, his wife earned a living cleaning staircases around their neighbourhood, and he had gone out to buy some bread to have for breakfast with his four children. He was introduced to politics by another councillor, José Luis Caso, whose death we noted with sorrow in this Parliament only a few months ago.
Mr President, the only way we democrats have of responding to murder, to bullets in the back of the neck, is with words. This we do, strong in the knowledge that we are simply crying out for a people, the Basque people, to be given a chance to live in peace, freedom and democracy.

Medina Ortega
Mr President, I would like to add a very brief word to express my solidarity with Mr Galeote. But I want to emphasize that this case is of particular importance, because Mr Zamarreño was the councillor who specifically represented the People's Party on the Rentería council. His predecessor had been murdered - between them there had been a councillor who resigned her seat because she was threatened - and it is clear that they are determined to prevent the People's Party from having a representative, duly elected by the people, on that particular council. This is an attack on democracy and we must use all possible means to prevent it from happening, because the truth is that it is an act of fascism to prevent a representative of the people from sitting on a council.

Gutiérrez Díaz
Mr President, as Mr Galeote has said, we shall not tire of raising our voices. We democrats will always have the weapon of speech. And, therefore, as long as fascist brutality goes on trying to silence those who have been democratically elected, we will tirelessly go on denouncing it again and again. But at the same time, Mr President, is it right that we should be wondering whether to offer opportunities for dialogue to those who have no words other than murder and bullets? Mr President, Europe, which is in favour of dialogue, empathy and comprehension, cannot understand why we should want to offer dialogue to anyone who offers nothing but death.

Imaz San Miguel
Mr President, on behalf of my party, the Basque Nationalist party, I too want to condemn the brutal murder of Councillor Zamarreño, a representative of the Basque people, who has been murdered by the ETA terrorist organization. I would like to express my condolences and solidarity with his family and also my total solidarity with the People's Party, which Mr Zamarreño represented. I would assure them of my total solidarity with that other political family of his, out of my conviction that arms and violence cannot silence the People's Party's legitimate defence of its ideas in the Basque country. I only hope that we Basques, the vast majority of whom want peace, might be able to find the way to rid ourselves of the violence that still goes on in our country and among our people.

Vallvé
Mr President, I too wish to express the strongest condemnation of the murder of the Rentería councillor, as a representative democratically elected by his fellow citizens. And in that respect, we believe that democracy and peace can only be achieved by listening to the voice of the people and never by taking the lives of their representatives.

Robles Piquer
Mr President, I do not propose to speak on this sad event - which naturally grieves me as well - but I regret that I have to report to my fellow Members in this House, particularly the ladies, the death, in this case from natural causes, of Carmen Llorca Vilaplan, who was a Member of this House for many years and worked hard here, especially in the fields of culture and women's rights. I am sure she will be remembered with affection by many Members.

Nicholson
Mr President, I should like to take this opportunity to thank you for your message this morning to the new assembly in Northern Ireland which I hope is now getting under way. For the first time in over 25 years the people of Northern Ireland will soon be able to decide on their own destiny. I would also like to thank you personally for having come to Northern Ireland and thank this Parliament for its support in many ways down the years. It is a historic day. I have no doubt there will be difficult times on the road ahead but I hope and pray that in future when I rise in this Parliament, to speak on behalf of the people of Northern Ireland, it will be about good things and not the dark days we have come through over the last 25 years.

Approval of the Minutes
President
The Minutes of Friday, 19 June have been distributed.
Are there any comments?

Provan
Mr President, I refer to page 16 of the Minutes. Under Item 8, the COM on oils and fats, there is a reference to Rule 99. This is a report taken without debate so it should be Rule 97 which is a matter of urgency requested by the Council. As far as I am aware, the Committee on Agriculture and Rural Development agreed to urgency on this and there was a full debate on the Friday morning.
I now refer to the middle of page 19 in the English version, where it says that Mr Colino Salamanca, the chairman of the Committee on Agriculture, requested that this report be referred back to committee. There is a matter of principle here. It is not possible for a chairman of a committee to refer an urgency back to committee when that committee has not been involved in the debate that has taken place. There were no amendments from the committee and I am not quite sure on what grounds the chairman was asking for referral back when he was representing the committee. This matter needs to be looked at either by the Bureau or by the Committee on the Rules of Procedure, the Verification of Credentials and Immunities.
Mr Colino had every right as an individual to seek referral back to committee if he so wished but to do so he would have needed the support of his own political group or 29 Members. That was not requested by the President at the time. I am not criticizing the President who has our complete support every Friday morning that he is in the Chair. But it is a matter of principle that the Bureau needs to look at.

President
Thank you. I think not only the Bureau but, if necessary, also the Committee on the Rules of Procedure should remedy this omission.

Varela Suanzes-Carpegna
Mr President, I have a comment on the Minutes of Friday, 19 June 1998. On page 18, in the vote on my report, there are two errors. One relates to paragraph 10: although I made an oral request for a linguistic correction to the Spanish version, this has not been done, and I wanted to say that in the various paragraphs where the word 'oil' appears this should read 'olive oil' . And a new paragraph 13 has been wrongly added, when I indicated in my oral amendment that this was an addition to paragraph 12. I should, therefore, be grateful if what appears as paragraph 13 could instead be added to paragraph 12.

Bösch
Mr President, I am very pleased to have the opportunity to speak. I put my name down to do so some time ago, but perhaps you need more staff in the Bureau so that you are aware of all the Members wishing to speak.
I should like to raise one point. At the last sitting in Strasbourg at midday on Friday, we agreed at short notice to adjourn a number of agenda items until the next sitting as there were not enough Members in attendance. This is now the next sitting. The items in question do not appear on the agenda. When do you intend to deal with these items in the House?

President
They will be dealt with in Strasbourg. This will be put to the Conference of Presidents, which will be meeting today and is the appropriate body to approve the draft agenda. This, of course, could not have been done earlier. In any event, my assistants are sufficient for the time being.
Mr Colino, I assume you are asking to speak regarding some personal remarks.

Colino Salamanca
Mr President, it is just that my name has been mentioned by Mr Provan. Rule 60 states that once amendments have been voted on, the Commission's opinion on those amendments may be sought, and it expressly states that before proceeding to vote on the draft legislative resolution the chairman of the committee or the rapporteur may, if necessary, request that it be referred back to committee. Since there was no rapporteur, I made that request as chairman of the committee. I agree that this is undoubtedly a problem of interpretation of the Rules of Procedure, but in any event I acted in accordance with the Rules of Procedure themselves.

de Vries
Mr President, we have been discussing points of order for 25 minutes now. I have no wish to deny any of my colleagues the right to introduce points of order but I feel that we would be better to start with the Commission's communication at 3.00 p.m. as stated in the agenda. First let us hear the Commission's communication and then, when that ends at about 4.00 p.m., give Members the chance to debate points of order. Both we and the media are here for the real debate. The Commissioners are entitled to expect us to discuss this important political issue before we regulate our own internal affairs. I would therefore like to propose, Mr President, that in future we start with the Commission's communication at 3.00 p.m. sharp and postpone any points of order until 4.00 p.m. when we start with the normal agenda.

President
Mr de Vries, you know as well as I do that points of order must be raised at the appropriate time, and none of us has any option but to be extremely disciplined.
(The Minutes were approved)

Welcome
President
I would like to inform you that a group of Dutch members of parliament invited by one of our Members are now in the official gallery, and at this point I would like to convey our greetings to our colleagues from the Dutch parliament.

Court's ruling in Case C/106
President
The next item is the Commission's communication on the follow-up to the Court's ruling in Case C/106 (legal bases in the budget).

Liikanen
Mr President, a recent ruling of the Court of Justice has raised serious questions about the execution of the Community budget, both in 1998 and beyond. The Commission is aware of the concerns which these difficulties have created, and I welcome the opportunity to inform you of the state of play on this matter. I would, however, like to state from the outset that any answer provided today can only be preliminary: the examination by the Commission of the budget lines concerned is going on at this moment. As agreed at the Budgetary Trialogue of 23 June, the Commission will draw its conclusions on 14 July, in time for the discussions between the European Parliament and the Budget Council of 17 July.
The judgment of the Court of Justice of 12 May 1998 is the result of a legal action brought by the United Kingdom, later supported by Germany, Denmark and the Council. The action was brought against a decision of the European Commission in 1995, to finance projects to combat poverty and social exclusion, although the proposal for a legal base for the 'Poverty 4' programme had been blocked in Council. In its defence, the Commission was supported by the European Parliament which had inscribed credits for such projects to the 1995 budget. But the Court concluded that the Commission was not competent to fund the projects concerned.
Furthermore, before the specific case at hand, the Court set out a number of principles of which the Commission must take account as regards the implementation of the budget. In brief, the Court insists that funds for significant Community action can only be executed if there is both an entry in the budget and a prior adoption of secondary legislation, that is a so-called 'legal base' , authorizing the action itself. The Court accepts, however, that a legal base is not required for non-significant action.
The Court does not define 'non-significant' . But it insists that a small amount or a short duration are not, per se , sufficient criteria. Instead the Court points towards the right of the Commission to exercise its power of initiative by initiating, on its own responsibility, the studies or projects required to prepare its proposals. From that it can be derived that pilot projects, preparatory measures and studies to prepare or update legislation can be executed without a legal base. In addition, autonomous actions of the institutions have not been disputed.
In this situation, once the ruling of the Court had become available, the Commission had no choice but to suspend temporarily the execution of all budget lines of the 1998 budget without a legal base and to examine as quickly as possible whether they can still be executed in the light of the ruling of the Court.
The situation of this examination as of today is the following: 90 budget lines have been temporarily suspended. The total budgetary volume in question was some ECU 870m; for 19 of these budget lines, the Commission has proposed legal bases, some of them already four years ago. The volume concerned is some ECU 500m; more than 30 of the temporarily suspended budget lines have already been re-opened, as the Commission is satisfied that they meet the criteria of the Court. Thus execution has resumed of some ECU 240m; for the rest the examination continues and the Commission should take its decision on 14 July 1998.
In parallel to its internal investigations, the Commission has contacted Parliament and Council to discuss the situation. The Budgetary Trialogue of 23 June has permitted to agree an action plan with three elements. Firstly, Council and Parliament will accelerate the adoption of legal bases for which the Commission has already made proposals. This is very important because it concerns some major budget lines, in particular the 'Community measures for NGOs' (for which a legal base has been proposed in 1995) and the 'Human Rights and Democracy initiative' (proposal one year ago). Fortunately, the legislation for the European voluntary service has now been concluded (after two years) and the execution of the programme can resume shortly.
The Commission will have an opportunity tonight and tomorrow to draw the attention of the Austrian presidency to the urgent need to adopt these legal bases. But it is up to the legislative authority to make a special effort in this respect.
Secondly, in the Trialogue the Commission committed itself to conclude its examination in time to provide results for the meeting between the Budget Council and the European Parliament of 17 July 1998. This will be done. Thirdly, the institutions will make their best efforts to come to a 'code of conduct' for the question of legal bases already on 17 July. The Commission has been trying for years to secure conclusion of such a code of conduct. It has made a number of proposals which, unfortunately, have not been agreed between the Council and Parliament. The most recent proposal has been made in the framework of the Commission proposals of 18 March 1998 for the next interinstitutional agreement. Discussions at a technical level are going on among the institutions. We will do everything we can to be able to conclude the discussions at the next Trialogue in two weeks' time.

Cot
Commissioner, you have just said that the Commission had no choice but to suspend over 40 budget lines. But you are fully aware of the consequent effect of the judgement, and especially the fact that this was a very particular situation since the problem was not the lack of any legal basis, but the abolition of a legal basis: the Poverty 3 programme.
Do you not agree, however, that - like Lucky Luke, the cartoon cowboy - you are firing quicker than your shadow and by sending this catastrophic signal to a group of people directly concerned with programmes which affect the most deprived of our citizens, you have deepened the crisis of confidence between the most deprived section of European society and ourselves?

Liikanen
We must remember that the decision of the Court concerned issues which affect the weakest part of our society, namely the budget lines against poverty and social exclusion. We all think these actions have been extremely important but when the Court announced its decision on the Commission's competence to implement these budget lines, we had no other choice but to seek legal certainty for the implementation of the budget from now on. Suspension was the only choice we had. Of course since then we have been working day and night to find solutions as quickly as we can. But the Commission is not above the law. We must respect the decision of the Court of Justice even though it gives us many difficulties. I am sure that in two weeks' time the situation will have become clearer. I cannot guarantee that everything will have been resolved but the vast majority of the issues will be.

Christodoulou
Mr President, in spite of what has been said regarding the settlement of the current issue, that is, the suspension of budget lines following the ruling by the Court of Justice, I nevertheless wish to draw the attention of the Commission and the Members of this House to the issue of the institutional solution to the problem.
This issue has been shuffling around Parliament since 1982 and each year all kinds of problems surface which curtail Parliament's possibilities to exercise its powers.
In parallel, therefore, to the solution of the short-term problem, that is to say, the specific issue of the current budget, in the debate that will take place on 17 July a solution must be found to the long-term problem. In other words, we need to define an institutional framework which will allow the institutional problem to be solved on a predetermined basis and in a legally acceptable way, so that the problem of legal bases will not arise each time and cause the problems that it does.
I am of the opinion that, in the event that a solution is found to the short-term problem, we must also have the institutional solution in parallel. If not, I very much fear that the consequences for the current budget and for subsequent budgets will be considerable and the responsibility for this will lie with everybody.

Liikanen
I agree with this statement. It is very important to try to solve this problem which has been pending since the 1980s. In the best scenario, by 17 July we could have a clear situation for the 1998 budget and a solution for the long-term which could then be a part of the interinstitutional agreement which must be concluded before the end of this Parliament. If we can agree on all the basic elements that would be the basis for the action from now on. There are two questions here which are very important. The first is: what is non-significant action? The common opinion is that it essentially helps the work of the Commission in the execution. The second issue which must be discussed is what is to be done in the case where a legal base has been proposed but not accepted. There is clearly a difference between these two dates and technically that could lead to a situation where we must cut off the action. We must find a solution which will make a bridge from the normal preparatory action to the date when the legal base has been accepted so that the legislative procedure will not stop an activity.

Ojala
Mr President, much damage has indeed been done, and it will take years to patch matters up. The confidence of the public and that of the national organizations has gone, and, though we may find a quick solution, the damage is going to take time to repair. I maintain that the reputation of the European Union, Parliament, and all EU institutions has been tarnished. Mr Liikanen, you stated that a quick solution is now being sought. It is most important and necessary that a quick solution be found and that this code of conduct be implemented. But what if we have no solution on July 17? Will Parliament, in that case, have to use the only means ultimately available to it, which is that we refuse to discuss the budget if no solution is found? Can you assure us that the Council will in this case now approve this joint agreement and give it a legal basis? Can you give us a guarantee of that?

Liikanen
Mr President, we need three parties to the agreement: the Commission, Parliament and the Council. No agreement will emerge unless all three find a way to compromise. Much work obviously needs to be done here, and we also need a sense of good will as well as an appreciation of just how serious the crisis will be if legislation and the budgetary authority are at loggerheads. In this respect, I hope this very unpleasant situation has at least raised awareness of how essential a solution to the problem is.
The Commission cannot give guarantees that the Council will go along with the Commission's position, but at least the former chairman made a commitment to doing everything possible to find a solution. Today and tomorrow the Commission and representatives from the country holding the presidency, Austria, are staging a conference in Vienna, where this matter is up for crucial discussion. We hope to see a sufficient degree of coordination in the Council, also, for those nineteen proposals for legal bases which they have there, and many have been around for a long time now, to be dealt with quickly.

Giansily
Commissioner, I think that this matter illustrates the saying donner et retenir ne vaut .
What kind of a situation do we have here? Thanks to the Interinstitutional Agreement, we can have the last word on noncompulsory expenditure. However, this Court ruling has simply led you to freeze some of the credits on the grounds that we must wait for a supplementary regulation. I think that you are going too far, because we all know perfectly well that a legal base has been missing for a good number of years and that it is essential, as regards decisions taken by this Parliament, that such decisions be implemented.
Who is affected by your decision? In the final analysis, it will affect a large number of NGOs, that is, organizations which need these funds in order to exist and which cannot wait until the long drawn-out bargaining processes between the Council and the Commission are over. So I hope that you will not wait until 17 July, but if you do have to wait until then, that you will be able to provide us with an assurance, on that day, as to the commitment of these funds.

Liikanen
We must remember that the Commission cannot behave as if the Court ruling had not taken place. The Court of Justice is an independent institution in the European Union and we are obliged to follow its ruling. Whatever we think of the contents of a particular budget line, we are not above the law. The political adjustment cannot go in a different direction to the clear contents of the Court decision. The clear message is that according to the Court, significant Community action requires both appropriations in the budget line and a prior legal base. We must follow that decision now. There are areas where we have more margin of judgment such as pilot projects, preparatory actions and autonomous actions. But we must review everything.
We must remember the poverty programme was blocked in the Council. We wanted to continue some actions which were very close to many European citizens which we had implemented, supported by the European Parliament, but then the Court of Justice announced this decision. So we cannot continue as if the decision had not happened. Of course, we are working as hard as we can towards clarifying the situation by 17 July. I have told you already that we have been able to clear budget lines which amount to approximately ECU 240m. For the rest, I hope we will have completed our work in the next two weeks.
We must treat this very seriously because the Commission has the responsibility for execution thereafter. We do not want to restart the same problems which led to the Court case.

Malone
I am not totally convinced that Commissioners Flynn and Bonino would agree with your very restrictive interpretation of this Court ruling. As you have quite rightly said, the areas and the budget lines affected are those which are closest to the citizens and which, coincidentally, have been put in by the Members themselves. If you are trying to keep the link between Parliament, Commission, Council and the people, you must try hard to get a quick solution to this. NGOs are closing down at this very moment because they cannot enter into any new commitments. No new contracts can be signed and so on.
When the Treaty of Amsterdam is ratified by all the Member States and comes into being, how do you view the unanimity clause as regards the non-discrimination and social exclusion provisions. We could fund certain of the poverty lines and the social exclusion lines under the Treaty, but we still need unanimity. Perhaps you could enlighten us with the legal expertise at your disposal. We might still be in a legal quagmire unless we have a proper interinstitutional agreement.

Liikanen
I am afraid that your target is wrong. The Council did not accept the legal base but when the Commission decided to execute that legal base, Members of Parliament attack the Commission. Our decisions have been annulled and we must follow the law. There are many areas in the budget which are very close to what I would like to do but that under the Treaty and financial regulations we need a prior legal base and appropriations in the budget. The Court has now clarified that position. We cannot continue as if Court of Justice decisions had no bearing on how the Commission acts.
We must be extremely clear about this. We have some margin of manoeuvre when you talk about pilot projects, preparatory actions and autonomous actions. We are trying to clarify every case. I do not want to be in a situation in the future where a new decision of the Commission will be annulled by the Court of Justice and perhaps then the organization will have to pay the money back. This time that did not happen. The Court has said we do not have to pay the money back. However, if the same thing happens intentionally in the future, then the damage to European public opinion will be disastrous. I agree it is important to be close to the European citizens; it is also important to respect the founding treaties on which the whole Union is based.
As far as the Treaty of Amsterdam is concerned, it is possible to think along the lines of whether we could do something preparatory for the new Treaty. This contains new articles on employment and the social field. We are having intense discussions on that and perhaps that could be a base for preparatory actions. Thirdly, this legal interpretation has been prepared in the Commission by our legal service and by our budget department and agreed fully in the Commission. There has been no political difference of opinion in the Commission on that decision.

Brinkhorst
Of course we accept that the Commission must respect the law. But the Commissioner has also said there is a margin for interpretation. I would like to ask the Commission to show some political courage. The Commission cannot sit silently between the Council and Parliament and say whichever is stronger will win. Specifically, I should like to ask the Commissioner, in the event of a choice between Article 235 which requires unanimity, and other legal bases, will the Commission always try to use the legal base which gives most powers to co-decision with Parliament?

Liikanen
That is a very important question but it does not help in this matter. The present problem is whether there is or is not a legal base. As you know, our position has always been to support co-decision within the whole decision-making system as much as possible. I do not disagree with Mr Brinkhorst on the matter in general.

Dell'Alba
Commissioner Liikanen, the Commission has been in operation since 1 January 1995 and since that time you have been responsible for the budget. This Parliament has not given a discharge for the 1996 budget and has reserved the right to do so in September. The officials went on strike because your proposals, Commissioner, came, shall we say, unexpectedly and were kind of makeshift solutions. Now we have this matter that the Commission apparently did not discover until 12 June? Since it has the power of initiative, how do you see the Commission's responsibility in this matter? It is a matter that certainly puts the European Parliament in very serious difficulty but also greatly damages the European Union's image, considering the problem of the legal basis and the fact that the Commission knew for years that the institutions had to be given one. Certainly, the Council, in particular, is seriously behind in its work, but the Commission is perhaps somewhat at fault too. I would like to know what you think about this, Commissioner.

Liikanen
You are right when you say that. This Commission has been in office since January 1995 and we must remember that these budget lines were executed in 1995. It was this Commission's decisions which have been annulled. That is why we must take it seriously. If it had been otherwise, we would say that it was not our responsibility. But, it is our responsibility - mine and the whole College. To say that we interpret this to mean that everything can continue as before would be contrary to the Treaty and the whole spirit of the European Union. We have given the role of resolving conflicts to the Court of Justice and now we must follow its decisions. In some areas, there is a margin of manoeuvre, and we will try to use this as much as we can.
As far as our initiatives are concerned, your colleagues in the Committee on Budgets know that we have made proposals all the time to solve the issue of the legal base. I have raised this matter every year in every Trialogue since the beginning of this Commission. Mr Christodoulou, the rapporteur for the European Parliament, has been very active on this matter. The Council has been extremely hesitant. Now I am a little worried that we are missing the target in the debate. We have taken the initiative to seek an agreement between the institutions. We have made proposals for the legal bases. The Council has not accepted. We have not found a solution on an interinstitutional agreement but a lack of initiatives is not the problem. There are plenty of initiatives. But now we need a solution. I am sure that your colleagues in the Committee on Budgets and those who take part in the Trialogue will do everything they can together with us to find a line which could be acceptable for all three institutions.

Ullmann
Mr President, Commissioner, thank you for clarifying a number of the points which I had intended to raise. You are quite right to stress that the Court's ruling must be adhered to, but this is precisely the point of my question, which relates in particular to Paragraphs 39 to 42 of the ruling. In this respect, the Commission's action differs fundamentally from what the ruling says. The ruling has exempted a whole range of existing contracts and payments from suspension. The Commission is proceeding on a very different basis. It is examining everything and is now giving us a total of everything it has examined, but this does not satisfy the concern felt by the general public. I would like to ask you to respond now to this public concern by providing a second answer in line with the wording of the ruling, which refers to specific categories.
Secondly, you have repeatedly told us that you are working towards an interinstitutional agreement. However, our priority is to find legal bases - and since you have also argued in these terms, I assume it must be your priority too - and an interinstitutional agreement is not a legal basis in terms of the ruling's requirements.

Liikanen
The Commission policy since 1994 has been to interpret an action which involves less than ECU 5m and of a duration less than two years as not significant. We have applied this interpretation since 1994. The problem is that the Court did not accept it. It said that small amounts or short duration are not good enough arguments. So, our position has been questioned. Secondly, on the question of legal bases, as I said in my statement, we have 19 legal bases now pending in the legislative authority. ECU 500m are dependent on those legal bases. We need to get them through. In many areas there is no disagreement on the political contents. There is very often disagreement on the different procedural issues or comitologies or the article on which to base the legal base. We need a strong political will and strong coordination in the Council to get them all through.
The interinstitutional agreement is important for those so-called grey areas. We must try to have a common opinion on what is 'non-significant' . The unilateral position of the Commission has not been accepted by the Court. But if all three can agree on some interpretation, then we will have a new situation.

Banotti
The Commissioner is under a lot of pressure today and Parliament has expressed a significant amount of concern. Could the Commissioner tell us how the full College of Commissioners will respond to his very obvious good will in this situation? Also, we must note that, unfortunately, Courts of Justice are not elected and their members do not have to feel the citizens' hot breath on the backs of their necks. Many NGOs, in particular in the area of safety and protection of children, have so far not qualified for any funding under previously existing rules. I hope that those organizations who do not have the opportunity to avail of Structural Funds will be given priority when the decisions are made in the Commission.
I would also like to ask the Commissioner what he thinks about the Committee on Budgets' opinion. It has not been mentioned this afternoon but I believe it is not as sympathetic to us as we might want.

Liikanen
Mr Christodoulou, the rapporteur for the Committee on Budgets, asked me about the legal base and he has expressed the position of the European Parliament. On the basis of the Trialogue, my conviction is that we are not very far from a solution but we need a strong effort by the Parliament on the basis of the decision which has been taken and also from the Council. If we have the basis for an agreement, the Commission will do all the technical preparations necessary.
As far as the NGOs are concerned, in the future the key matter for them is that we have a basic legal basis for their activities. That is what we have been proposing since 1995. If the Council accepts that legal basis it is cleared for external actions. Internal actions will need the same. On the political priorities of Parliament, I do not want to interfere in discussions between the Committee on Budgets and the other committees.
Finally, I have received personally every NGO which has asked for contact. I have talked to them directly and explained the situation. We must try to find solutions which support the political priorities of Parliament and the Commission but which are legally solid. We cannot have it any other way.

Green
The Commissioner will now have heard the anxiety across the political spectrum in this House about what has happened with these legal bases and budget lines. This Parliament is deeply committed to those lines for several reasons. Firstly, they take this institution and the Union closer to the people. But also we - like the Commissioner - have been on the end of the lobby from NGOs, organizations and people who have been supported by those budget lines and now find they are not available. The Commissioner has made it clear that the real problem lies with the Council, not with this Parliament and not with the Commission. Could he perhaps then join with us in saying that what we need now is a concerted Parliament and Commission line which says to the NGOs and the people of the Union that they can continue to write to us but they should direct their anxiety and lobby the Council and the national governments. We in this House can perhaps provide addresses, telephone numbers and faxes of relevant ministers so they can feel the same heat as us. Commissioner, we would like your support.

Liikanen
I fully agree. It is important that our actions in the Commission and in Parliament are targeted on the areas where the problems are. Many problems are solved on the day the Council accepts the legal base. We must try to convince them. We tried with the previous presidency and we begin tonight with the Austrian presidency. I am sure that this very unpleasant crisis has transmitted the concern of the citizens to the Council. We must try to find a solution which will attract popular support.

Galeote Quecedo
I am pleased that the Commission has taken cognizance of the concern which exists regarding this situation. That concern is quite obviously shared by the European Parliament and civil society is very sensitive about the matter. I think we must show that we share that concern by introducing transitional measures, once the ruling is known, until there are legal grounds for approving the various regulations that will authorize the actions provided for.
Mrs Green is right that we should bring pressure to bear on the Council. But the European Commission must also do its duty and give specific answers to the questions placed before it. For example, how does the European Commission interpret the scope of the words 'non-significant measures' in the ruling?
Secondly, what will the European Commission be doing about the programmes approved in the 1998 budget?
And thirdly, ...
(The President cut off the speaker since he had exceeded his allotted time)

Liikanen
We try to analyse all the budget lines now in the spirit of the Court ruling so that we have a right to execute pilot projects and preparatory actions. All those actions which fulfil these criteria can be executed without a legal base. We work on this basis. When the Court does not accept our interpretation about a certain amount of money, we cannot insert a new sum because it says clearly that a small sum is not a sufficient condition to execute a budget line as being not significant. So that basis does not exist. But pilot projects can be small and can be larger. Preparatory action can be small but can be bigger. The key thing is that we have to try to make a qualitative analysis of the old actions, not quantitatively as was done in the past.

President
Thank you, Mr Liikanen.
This matter is closed.
Mr Telkämper wishes to speak.

Telkämper
Mr President, I think that you should give an answer to this question in your capacity as President. The point is that we cannot ask - or indeed complain about - the Commission because there has been a shift of power: the Commission and Parliament are now in the same boat with regard to the Council. It is now time for Parliament to make a statement on this issue. I think that you yourself have recognized that Parliament has become weaker, and it is up to us, as Parliament, to take a political initiative to ensure that this shift of power which has occurred - and I think there has been a shift of power vis-a-vis the Council - is removed by Parliament. I would ask you to ensure that this item is included on the agenda at the next part-session in Strasbourg and that we, as Parliament, take an initiative to restore Parliament's power in this respect. It is a question of the Treaty; perhaps, on principle, a codecision procedure should be introduced ...
(The President cut off the speaker)

President
Mr Telkämper, that, as you know, is not within the President's powers. It is the prerogative of the Conference of Presidents, with which you may raise this issue through your political group, as any other Member may raise an issue through his political group. The President, however, is not responsible for drawing up the agenda. That is for the Conference of Presidents to decide, and ultimately the whole House when it approves the agenda.

Colom i Naval
Mr President, I respect your authority as President to conduct the debates, but perhaps, in a debate of this kind, if the rapporteur asks to speak it ought to be one of the 20 or 30 Members who could put a question.

President
Mr Colom, this is a debate which is ordered in such a way that all Members can have an opportunity to speak, whether they are rapporteurs, chairmen of groups or anything else. And, within the limits of the President's powers, and there are many such limits, we try to strike a balance between nationalities, political groups, etcetera. In your case, unfortunately, you have asked to speak but so have other members of your group, and rightly or wrongly, I had to choose one of them.

Euro-Mediterranean Agreement with Jordan
President
The next item is the report (A4-0165/98) by Mrs Aelvoet, on behalf of the Committee on Foreign Affairs, Security and Defence Policy, on the proposal for a Council and Commission Decision on the signature and on the conclusion of a Euro-Mediterranean Agreement with Jordan (COM(97)0554 - C4-0171/98-97/029(AVC)).

Aelvoet
Mr President, let us turn our attention to the Euro-Mediterranean Agreement between Jordan and the European Union. This Agreement forms part of the overall process known as the Barcelona process, a process whose purpose was - and I hope will continue to be - to achieve closer links between the European Union and the countries of the southern Mediterranean, and of course between the European Union and the Palestinian Authority.
The main objectives were: to help achieve peace and stability in the region; increase economic cooperation, for which a perspective was drawn up on the establishment of a free trade agreement between Jordan and the European Union after a period of twelve years; increase regional cooperation; provide more opportunities for social and cultural cooperation through organized links; and finally, to allow Jordan access to MEDA funding.
Since the establishment of the Barcelona process, four similar association agreements have been concluded with Israel, Tunisia, Morocco and the Palestinian Authority. Unfortunately, it looks as though the Middle East peace process has ground to a halt. There is increasing evidence that this is so. This naturally places a very heavy burden on the original purpose of the Barcelona process whose very aim was to give peace more of a chance. In June, further efforts were made at Palermo to give new impetus to the peace process by convening a meeting of Foreign Ministers of the European Union and partner countries. Ultimately though, it is events that determine future progress and not just meetings. A meeting may help but it cannot act as a counterweight if everything else continues to point towards a harsher reality. The situation in Israel is giving more than cause for concern.
The Agreement with Jordan has been a long time coming. This is largely because Spain expressed opposition after the original agreement had been initialled. It felt that one particular clause was too prejudicial to the Spanish tomato market given the possible import of Jordanian tomatoes. This finally resulted in the clause being altered and an increase in the quota of tomato concentrate. Jordan had then to forego an overall review of the quota. This is an embarrassing example of how a project aimed at giving shape to a European Union foreign policy can ultimately stumble over a few cases of tomatoes. There is not really anything to boast about.
Turning to Jordan itself, there can be no doubt that its economy is weak. Like the Palestinian economy, the Jordanian economy is suffering a great deal due to the deadlock in the peace process. There are many in the European Parliament who plead for sympathy for the situation in Israel. They should take a look at the situation elsewhere and see how every economic initiative is grinding to a halt because of the difficulty there is crossing borders. This is because there are only two bridges that can be used in either direction and because Israeli border checks continue from early in the morning until late at night. The country that summoned the political courage to sign a peace agreement with Israel in 1994 is now paying a very heavy economic price for doing so and not reaping the rewards it had hoped for the political courage it actually showed.
With regard to democracy, it is clear that Jordan has a long way to go before it meets the main criteria for a well-functioning democracy. In some respects, the situation is actually deteriorating. But if you compare the situation in Jordan with the average situation in all of the other countries in the region, then Jordan is doing relatively well. As I suggested in my report, I think that the European Parliament is doing well to define what problems there actually are and plead for the adoption of the cooperation agreement; at the same time we should monitor the situation with regard to democracy and human rights and use this agreement to demand more progress, because things have got to improve.

Günther
Mr President, firstly, I should like to thank the rapporteur for her work, and also for her comments here today. I can only agree with her that whereas Jordan is not a developing country in the traditional sense, it has not really been the focus of the European Union's attention for some time. Certainly - and I agree with the rapporteur on this point too - Jordan has a less than perfect record on human rights and democracy, but I am sure we would all be pleased if Jordan's achievements, which Jordan itself is keen to improve, could be repeated in other parts of the world, especially in the 'classic' developing countries.
Democracy and human rights are always issues which we are increasingly stressing in our cooperation with other countries. Mrs Aelvoet herself has also undertaken the work necessary in connection with the Amsterdam Treaty and the Lomé Convention to enable us to make democracy and human rights a criterion for cooperation in general. The Committee on Development and Cooperation is therefore pleased that this, too, has been laid down in Article 2 of the Agreement.
Another point in the Agreement which we welcome very much is the intention to facilitate cooperation between the Parliaments, which is certainly important within the framework of the parliamentary forum of the Euro-Mediterranean process too. We are currently preparing the first meeting of this forum, and for this reason too Jordan is thus in an advantageous position to breathe life into this Agreement.

Sonneveld
Mr President, although the number of Euro-Mediterranean Agreements is continuing to increase, I have to say that the measures that were proposed at Barcelona far outweigh those that have actually been put into practice, particularly in the eastern Mediterranean. This is largely due to the deadlock in the peace process. Good headway in the peace process had to form the basis for greater economic cooperation between the countries in the region. The European Union promised that it would play an important supporting role.
A new cooperation agreement with Jordan would, of course, have to play a prominent part in this. Now that things have gone awry, we must welcome the new agreement with Jordan with open arms. As well as having genuine economic significance, it will play an important symbolic role. Jordan is a country with a long-term vision. It knows that its fate will depend on relations between Israel and Palestine. It wishes to play a positive role in the peace process and will, therefore, be an important participant in any future negotiations.
By signing this agreement, the EU will indirectly play a similar positive role. We share Jordan's desire for close links with Israel and the Palestinian Authority and do actually have such links. The very fact that the European Union is the most important provider of support to the Palestinian territories underlines our commitment to the future of the entire region.
The agreement is wide-ranging and ambitious. In twelve years' time, the European Union and Jordan will have established a free trade area. The agricultural sector will also have to play a prominent role. There is no sense denying that agreements of this kind will cause problems for the European Union as regards horticultural products.
In the years to come, we will be willing to strengthen our relations with Mediterranean countries in the area of agriculture, but not if our own EU producers will have to cushion our partners against market developments in the fruit, vegetable and flower sectors. Plans for these sectors in the Mediterranean region are very ambitious, too ambitious, in fact. We hope that it will be possible to increase cooperation in the agricultural sector but in a reasonable and sensible manner.

Terrón i Cusí
Mr President, I would like to welcome this Association Agreement with Jordan, which has been a long time in coming, as the rapporteur, Mrs Aelvoet, was saying. I would like to say that our group, the Socialist group, will be expressing its satisfaction with the Agreement by voting in favour of the rapporteur's proposal that we give our assent to the Association Agreement. And I would like to take this opportunity to say that we are concerned that the necessary ratification by Member States of the European Union will take another four years from now, and the implementation of this Euro-Mediterranean Agreement will, thus, be delayed even further.
Jordan is a country that has opted for peace and a country in a difficult region and a difficult situation. Jordan has to prove to its public that the peace it has opted for will benefit them. Jordan is a country that has maintained a constructive attitude in the dialogue process signed in Barcelona and has continued along the same road since. And the financial and economic cooperation that can come out of this Agreement is important to Jordan's political development.
With regard to agriculture, the sector that has caused the delay in reaching an agreement with Jordan, we have to accept its inclusion in this free trade area and find quicker formulas for achieving cooperation in that respect.
This Agreement also includes a political dialogue and a parliamentary dialogue which we have called for many times. In October, in this same House, there will be a multilateral dialogue between the parliaments of the region and the European Parliament. And I believe it is going to be important to ensure that this Agreement, like the rest, has been signed by then.
The Agreement also contains provisions for monitoring the observance of human rights and support for democratization. The situation in that field is not perfect. We are concerned not so much about the human rights situation - which, as previous speakers here have already said, is comparable to that in other areas of the world - as about a certain tendency for the situation regarding political rights - the right to hold meetings, the right of association, the freedom for elected members to carry out their duties, etcetera - to deteriorate, and we want that situation to improve. But we want to sign this Agreement precisely in order to be able to do that: to be able to play a proper part in the monitoring of human rights, as has been mentioned, to help in the democratization process.
I therefore reiterate our intention to vote in favour of the rapporteur's proposal. I only hope the Jordanians will not have to wait for a further generation before this Association Agreement is ratified by all the Member States of the European Union, and that sentiment applies equally to the other agreements that come out of Barcelona.

Konrad
Mr President, ladies and gentlemen, the conclusion of the Agreement with Jordan is a positive step, since this Agreement is an example of how the European Union can conclude treaties with other countries - in this case with the Mediterranean region, in particular - which are below the threshold for accession. I think that this can, and must, be a model for the future. We cannot only intensify cooperation when there is a prospect of accession to the European Union at the end of the process; instead, we must find other ways of proceeding. This Agreement is an example of how close relations can be achieved on the basis of an accord.
Agreements of the same type have already been concluded with Tunisia, Israel and Morocco, and this new Agreement thus fits in with the European Union's policy on the Mediterranean. A Cooperation Agreement with Jordan has existed since 1977. Four supplementary financial protocols have already been signed within the framework of this Cooperation Agreement. After a transitional period, the aim is to establish an area of free trade which should be achieved on a step-by-step basis. I believe that this is an important move towards a Euro-Mediterranean free trade area, which is what we are aiming for. The Christian Democrats in this House, the Group of the European People's Party, has always supported and worked actively towards this goal; I should like to emphasize this point very clearly once more.
However, there are criticisms which we can make in relation to Jordan, and which we should not gloss over today. The rapporteur made brief reference to this at the beginning; however, her report does not make these issues as clear as I would have wished. I think that two points should be made in this connection, and I shall name them: the restrictive press laws in Jordan, and, above all, the ban on all forms of political assembly. I think that the discussion process with Jordan can be a way of initiating talks about these issues too. They could thus be dealt with through political dialogue in such a way as to ensure that democratic conditions are achieved as we would wish and in line with the conditions set by the European Union, at least in the final phase, when it concludes agreements of this kind.
I am pleased that this Agreement has been reached and that solutions were found within the framework of the trade talks too, for I believe that Jordan, in particular, must be given our support. Jordan has always been a reliable partner in the Middle East and also contributes to the stabilization of this region. I am looking forward to the dialogue between the European Parliament and the Jordanians.

van Bladel
Mr President, I regard closer links with Jordan as a natural means of strengthening the agreements that have already been concluded with Israel and the Palestinian Authority. We are clearly leaving out Syria and Lebanon although that is not such a problem. But what about Egypt? I have been rapporteur for Egypt for three years now and regret to say that negotiations are still deadlocked over a number of issues: agricultural products and human rights. Mrs Aelvoet has already mentioned agricultural products. An agreement should not hang on a case of tomatoes. I say we should give Egypt a fair export quota. The situation with regard to human rights is rather more complicated although I will not go into that here.
The Commission has negotiated very hard with Egypt and has now reached the end of its mandate. I would therefore like to call upon the Commissioners to come and report on the situation as soon as possible. On this the first day of the Austrian Presidency, I would call upon Vienna to ask all of the Member States to speed up the agreement with Egypt because we do not want the first country in the Middle East that had the courage to start the peace process with Israel to be one of the last to be able to sign the agreements.
I hope that in the coming months the Council will not just give its attention to enlargement but will make one of its many tasks to call upon the Member States to bring the agreement with Egypt to a successful conclusion.
Very positive results have already been achieved with those countries with which we have already signed agreements. I am referring in particular to Morocco. I regularly come across Moroccan parliamentarians with whom we can talk business. I would like to see the same thing happen with Egypt and, of course, Jordan. I would also like to congratulate Mrs Aelvoet because she has worked hard to keep those cases of tomatoes out.

Bertens
Mr President, the Liberal group welcomes the conclusion of this agreement with Jordan. The European Union is doing well to pursue this Mediterranean policy under the Barcelona process.
We should not be put off by complications arising from deadlock in the peace process. Jordan is important to the peace process. Jordan was prepared to sign a peace treaty with Israel despite Israel's occupation of part of Jordanian territory in 1967. This is a sign of great willingness. King Hussein has quite rightly earned a great deal of respect. Since the time of the Israeli occupation, Jordan has continued to act as protector of the occupied territory. Jordan also has very large groups of Palestinian refugees within its borders.
Despite all these complications, Jordan is one of the few democracies in the region. We must encourage further democracy because improvements are possible and necessary. Mr Konrad has already mentioned those involving freedom of the press and the formation of political parties. If Jordan had been part of Africa, I think things would have been different and there would have been no agreement. I therefore think that it is right for the agreement between the Union and Jordan to contain a clause on democracy and human rights. I hope that we can adhere strictly to the clause.
In the current explosive situation in the Middle East, we must use this agreement to promote the prospects of a lasting peace. This agreement will hopefully help give the Jordanian people more chance of achieving economic progress. Hopefully, it will also help the country continue to promote peace and reconciliation. The Liberal group therefore accepts this agreement and joins me in sending compliments to my friend and colleague Magda Aelvoet.

Antony
Mr President, ladies and gentlemen, we approve the basis of this report and the improvement in relations between the European Union and Jordan. But I would first of all like to pay tribute to King Hussein, tribute which he so justly deserves for the many long years during which, under the most difficult circumstances, he has shown wisdom and worked for peace, torn as he was - as was his country - by powerful forces. In common with the Lebanon, Jordan has suffered problems due to the creation of the State of Israel, through the presence of many Palestinian refugees in Jordan who have sometimes behaved as a conquered state, forgetting their own difficulties and foisting their problems upon their host country.
This report is too critical because what we mean to say here is that human rights are far from perfect in Jordan; but what conditions prevail in the region? There is far less denunciation of things which happen in the neighbouring country. The daily press reports that huge crowds gather in Jerusalem itself. Mr Netanyahu goes there and up goes the cry, "Death to the Arabs' .
Curiously, those who appreciate the extremist positions in Israel are those who would sometimes like to teach us a lesson, whilst we only want to ensure that the basic sovereign rights of our people are respected. This is home to the Arabs; this is home to the Palestinians, and Jerusalem's policy of conquest and expulsion of the Palestinians and Arabs is a real catastrophe.
Here, people talk about freedom of the press, but if we take a close look at ourselves, we see that it does not exist. There are laws which a great journalist from our French daily newspaper, "Le Figaro' , a former Stalinist and something of an expert, who has acknowledged the errors of her youth when she was an editorial writer with the Jewish Tribune, called the intolerable Jewish thought police. We have laws which prohibit freedom of thought, freedom to write, so how dare we pursue in Jordan, living in a state of war, something we are unable to enforce at home, where we have an intolerable thought police. But, as always, there is truth on the banks of the Jordan, mistakes on the banks of the Seine.
As regards the free trade policy, we would like to impose some limitations on this concept, which we do not always agree with. But, in general, we would like to welcome the improvement to be made in our relations with Jordan, by voting for this report.

Speciale
Mr President, I too consider Mrs Aelvoet's report excellent and the agreement with Jordan positive, also because a solution has been found for some problems with agricultural production that were blocking the agreement. But you see, in all these agreements a problem occurs: either negotiations are delayed or some obstacle prevents subsequent ratification of the agreement reached. If it is not one Member State posing problems, it is another: this is the case for Egypt whose agreement still has to be completed or for Morocco whose agreement was concluded two years ago but has not been ratified.
This is not acceptable! We, the European Parliament, were right in taking a position a month ago and reminding the Commission and the Council of their responsibilities so that they, in turn, remind the Member States of their responsibilities. Otherwise, it is too contradictory: we cannot want to relaunch the Mediterranean strategy and then block agreements with individual Mediterranean countries. This is too contradictory.
We must, therefore, again recall this aspect. Jordan is an important country in Middle East affairs; it certainly has a few economic and social problems and also problems with full democracy, but - as Mrs Terrón recalled - in comparison with other countries, fundamental liberties and rights are guaranteed and there is a certain cohabitation between religions. We must make sure that this situation does not regress but instead gradually progresses. This aspect is, in my opinion, very important.
We must rekindle - now is the time to say it - political dialogue between parliaments: it will be very important if we succeed at the end of October in organizing the first interparliamentary forum between the European Parliament and national parliaments and in taking full advantage of this opportunity. We must, therefore, rekindle interparliamentary dialogue in general, and Euro-Mediterranean dialogue in particular. The meeting of Foreign Ministers on 3 and 4 June was useful in this sense, and I believe that it can help the third Euro-Mediterranean Conference.
The most important question relates to the peace process. As you know, the Palestinians have said that they accept the American plan whereas the Israeli government so far has not said that it does. This creates a very difficult situation. Some of today's newspapers carry an interview with President Arafat who expresses his deep concern about a very worrisome situation: he denounces Israel's siege of and stranglehold over the Palestinian Territories, a situation that cannot be accepted over a sustained period of time and that can only generate despair and especially hinder development and prevent the solution of poverty, a situation that is a kind of embargo, so to speak. The interview ends with a very serious and pressing appeal to the European Union, the only one that can help call off the siege. This is a very strong reminder of our responsibilities. We must tell everyone that you cannot play with peace, but especially that this region cannot be kept in a situation of marginalization, poverty and non-development. I understand that this is in the interest of some who today are stronger and more powerful, but this is not in the interest of all the peoples and not in the interest of the European Union; we must therefore remind everyone of their sense of responsibility in concluding this peace process.

Pinheiro
Mr President, ladies and gentlemen, this agreement follows the signature of two similar association agreements with Tunisia, Morocco, Israel and the Palestinian Authority in the context of the new EuroMediterranean partnership. This Agreement creates the necessary conditions for establishing the nucleus of a future integrated economic area, as soon as the political situation permits, in the Middle East and North Africa. By creating this network of agreements based on similar provisions, the Community is attempting to create an economically prosperous EuroMediterranean area and encourage the development of South-South economic relations, which are essential to peace and economic stability in the region. We hope the new Agreement will lead to a thoroughgoing renewal of our bilateral relations with Jordan. The Commission is aware that the gradual establishment of free trade with the Community is an enormous challenge to the Jordanian economy and Jordanian society.
In that respect, although the Community can only act as a catalyst for the efforts of Jordanian society, it will not fail to provide technical and financial assistance, through the existing channels, to support the changes Jordan will have to make.
The Commission is especially pleased that Jordan fully accepts the provisions relating to respect for human rights and fundamental democratic principles, as well as the need to prevent illegal immigration.
Finally, the Commission wishes to congratulate the European Parliament, and particularly Mrs Aelvoet, on the excellent work of the committees that studied the Agreement. We hope that the process of ratification by the Jordanian parliament and those of our Member States will soon be completed so that the Agreement can begin to produce its beneficial effects as quickly as possible.

President
The debate is closed.
The vote will take place tomorrow at 11.00 a.m.

Urban environment
President
The next item is the joint debate on the following reports:
A4-0177/98 by Mrs Pollack, on behalf of the Committee on the Environment, Public Health and Consumer Protection, on strengthening EU urban environment policy; -A4-0172/98 by Mrs Napoletano, on behalf of the Committee on Regional Policy, on the Commission communication "Towards an urban agenda in the European Union' (COM(97) 0197 - C4-0235/97)Draftsmen of the opinions: () Mrs Benassar Tous, on behalf of the Committee on Employment and Social Affairs; Mrs Pollack, on behalf of the Committee on the Environment, Public Health and Consumer Protection; Mrs Terrón i Cusí, on behalf of the Committee on Civil Liberties and Internal Affairs (Hughes Procedure); -A4-0206/98 by Mr Novo Belenguer, on behalf of the Committee on Regional Policy, on regional planning and the European Spatial Development Perspective (ESDP).
Pollack
Mr President, an analysis of the urban environment in Europe was undertaken in the excellent Commission Green Book of 1990, together with the parameters of a general approach at the European level, and we commented on that in my report in 1991. Further development from the Commission comes in the form of the urban communication which we are looking at later on in this debate.
The purpose of my new report is to take stock of what has happened since then and to suggest ways in which we can move forward by strengthening the development of European Union environment policy for urban areas. A lot of mileage has been made out of the subject of a peoples' Europe and yet our actions are not perceived by the majority of our citizens to touch their lives. It is my contention that the many factors which make up the urban environment are precisely those where we should be able to connect with people more closely. Policy development, however, must be from the bottom up, involving NGOs, women, men, old and young people and social partners. If we are indeed to develop the role of cities as generators of prosperity and economic growth and combat the under use of human resources, then an integral component of our work must be a tangible improvement in urban environments. I cannot stress strongly enough that social and economic development are partners of a better environment and quality of life in our cities.
What are our European objectives for our cities? I do not yet see a clear answer from the Commission. The main ingredients of quality of life are surely health, a safe and pleasant place to live, work and a variety of cultural experiences. We in Europe are proud of our cities, large and small, in which our culture, civilization and democracy have flourished and developed for many centuries. Yet these same cities are the scene of a wide rift between the haves and the have-nots. Poverty, racism, unemployment, ill-health, crime, traffic congestion, noise and air pollution scar the lives of far too many. So where is our vision?
Whilst celebrating the good with our cities of culture and so on, it is our duty to play our part in tackling the bad. I say play our part, President, because this is not something which the EU can or should tackle on its own. Clearly, a large part of the task must be for the local, regional and national authorities to deal with.
First, I would like to pay tribute to the work of the expert group on urban environment and to the sustainable cities campaign. Each has made enormous contributions to the development of urban environment policy, awareness raising and real actions which have taken place over the last few years. It is essential that they are guaranteed a continuous existence and do not have to worry about the future with every annual budget. Also, that proper resources are made available for the development of a partnership approach to urban environment and support is continued for collaborative schemes on best practice. Environmental degradation in our towns and cities is as widespread as the problem of social dislocation. We know that the poorest and most socially disadvantaged people tend to live in the most polluted areas. This in turn affects their health, particularly the weaker members of society such as the elderly and children. Yet there is a knock-on effect on the whole urban population as poor quality of life, high crime rates and pollution drive out employers and make life, even in the more attractive parts of town, a misery. Given the new public remit under the Amsterdam Treaty, criteria should be included in the new Structural Funds regulations on combatting levels of health-damaging pollution.
We have a serious task in front of us and there is still insufficient coordination inside the Commission to deal with urban environment. Yes, there is an inter-service working group but I believe it needs to be upgraded to a proper cross-departmental unit with a clearly specified reporting mechanism. We currently have no clearly articulated vision for a sustainable urban future across the range of policy areas. We also lack any fund whose primary aim is to improve urban environment. Clearly, some of the tasks for the near future need to be a proper sustainability audit and the development of comparable sustainability indicators. This must go hand-in-hand with the widespread dissemination of better information on the state of Europe's urban environment and an ongoing programme of pilot schemes.
One of the most important developments in recent years has been the proliferation of Local Agenda 21 schemes. Putting sustainability at the forefront of our efforts in urban areas is the key to successful action in the future and we need continued support for the Agenda 21 organizations. Sustainability is not only about the need to arrest environmental degradation and ecological imbalance and prevent the impoverishment of future generations. It is also about the need for quality of life and equity between current generations; an urban model which excludes a substantial environmental component is incapable of achieving this. I welcome the news that an urban environment action programme will be launched in Vienna in November. Please can we assure that flexibility is built into these action plans so that they can be applied to all areas in cities and not confined to restricted areas. If we can move forward along these lines, I believe we can begin to develop our cities so that they can be places of creativity and fulfilment for future generations.

Napoletano
Mr President, ladies and gentlemen, I believe that this resolution is a starting point for our Parliament because the European Commission's communication has the merit of initiating a debate and, for the first time, approaching urban problems from a global, comprehensive viewpoint. I believe that this is important because, to date, we have dealt with cities, but only in the context of sectoral policies. Furthermore, the Commission's document begins with the observation that 80 % of Europe's citizens live in cities: cities are where the greatest economic and social changes have occurred these past few years, cities have to face the processes of economic globalization that often upset their economies. Therefore, cities are where the greatest number of contradictions exist: in general, cities are where there is the most wealth - the level of the Community's gross domestic product is actually the highest in cities, but it is also where poverty is the most severe and where there is another, perhaps even more serious phenomenon, that of exclusion. All this therefore leads the Union to take a careful and concerned look at the development of this situation and these policies.
However, European policy has not yet drawn all the conclusions from this analysis. If you will allow me to give a naturally positive judgement of the Commission's communication, it is that this communication identifies and develops the problems in depth but is not very coherent in identifying which instruments should be used to intervene more effectively.
I will say immediately that this is not a simple matter, because it is obvious that the instruments are disseminated in various policies and, therefore, the policy that is more visible in terms of impact, including impact on citizenship, is cohesion policy. We must, however, be careful not to burden cohesion policy with the responsibility of assuming what should be the objective of other policies: I am talking about environmental policy and research policy but also agricultural policy, because cities are the place where the relationship between producers and consumers materializes, a relationship which is often rather critical and based on imbalances in the ability to control and participate.
Nonetheless, I believe that we are at an interesting point in our work, the point where we must link up various instruments with various courses of action; I personally think that we were right in organizing this debate in conjunction with the debate on regional planning in which Mr Novo will speak, because cities are in a region and we cannot, therefore, imagine a policy on cities that is not linked to regional policy.
Lastly, we will need to take immediate account of the single most important matter, reform of the Structural Funds and Agenda 2000, and with this report we are calling on the Commission to be more coherent in its policies on cities. It is fine to have introduced an urban dimension into Objective 2, but it is quite inappropriate to propose cancellation of the URBAN programme which does not in any way contradict this objective. It is also important that in Objective 1, the Interreg programme and Objective 3, which deals specifically with training and employment, greater attention be given to the impact of these policies on cities. And it is especially important that a conscious effort should be made to involve locally-elected representatives, for it is a major policy, an important policy with many challenges which, as a Union, we now want to take on, beginning with the challenge of employment.

Novo Belenguer
Mr President, this own-initiative report on planning and the European Spatial Development Perspective is part of the work being carried out by the governments of the countries belonging to the Committee on Spatial Development. On 9 and 10 June 1997 in Noorwijk, during the Dutch presidency, this work produced a first official draft of the European Spatial Development Perspective. This first draft stated that we have not yet considered, at European or national level, the three principal aspects of regional planning: the spatial aspect, based mainly on the location of people, activities and equipment; the economic, social and cultural aspect, based on employment and the search for work; and the aspect based mainly on the protection of the environment.
The report we are debating today concentrates on the content of the first four sections of this first draft perspective, the spirit of which is specifically summarized in the first part, defining the purpose of regional planning. That purpose is based on the principle, which we have constantly and frequently defended in this Parliament, that truly balanced competitiveness throughout the whole territory of the European Union can only be achieved on the basis of social and economic cohesion and the nurturing of sustainable development.
The second part of the document is the analytical part, which gives some idea of the difficulty of obtaining harmonized comparative data from the different Member States by complete and reliable methods. This demonstrates the need - as I have also specifically mentioned in the report - for the creation of a European Observatory for regional planning, as recommended at the 1994 Leipzig Council, and for a budget heading to make it financially viable.
The third part of the document is the political message itself, and this defines the European policy we ought to follow to achieve our regional planning objectives. I believe, Mr President, that that policy is incomplete inasmuch as it does not take sufficient account of cross-border and transnational areas.
The fourth part of the document refers to the practical application of the perspective, making allowance for the difficulty of an obvious institutional weakness at European level, which makes us incapable of carrying it through. I have tried to draw special attention to this aspect in my report. I therefore emphasize that the possibilities of intergovernmental action in that respect are now exhausted, and so it is absolutely essential that the policy on regional planning be officially introduced at Community level. And on this point I want to remind the House of the continuous calls by the European Parliament to give definitive official status to the Council of Regional Planning Ministers and to make the Committee on Spatial Development a permanent body, seeking, too, ways and means of enabling regional and local authorities to play an active part in the process.
There are, nevertheless, various existing Community instruments that can be used to implement the perspective, such as the Community policies affecting the spatial balance and the structural policies defined in Article 130a of the Treaty, the reform of which will have to take account of the political principles and options defined in the perspective.
And finally, I must draw your attention to the question of cross-border and transnational areas, as previously mentioned, especially in view of the future enlargement of the European Union, which is now imminent. In that respect, there was an interesting meeting of the Council of Regional Policy Ministers in Glasgow on 8 June, which, among other matters, considered the effects of enlargement on the present 15 Member States, which will undoubtedly affect the subsequent definition and content of regional planning in the European Union.
While on the subject, Mr President, I consider that we ought to add a further chapter to the perspective document to cover enlargement. This is the thinking behind the three amendments I have tabled, apart from wishing to include the Glasgow Council's conclusions in my report.
With regard to the other 14 amendments tabled, I would like to explain to you, Mr President, the reasons why I am against their inclusion in the document. It is because their philosophy is profoundly contradictory to that of the report. This report was approved by the Committee on Regional Policy because it emphasizes the need for a Community policy which gives the European Union itself the leading role in regional planning development, which, as I have already mentioned, will encourage social and economic cohesion and competitiveness within the Union itself; this is, of course, subject to the principle of subsidiarity, with the object of dealing more efficiently with the particular practical needs of the regions and thus including all interested sectors.
I would like to conclude, Mr President, by saying that it is now time for us to leave behind the fears of all Member States that regional planning policies may directly affect the reform of the Structural Funds, although we ought at least to suggest - from now on - that regional planning policies be used to coordinate the implementation of certain Community policies - agricultural, environmental, research and development, etcetera - all, as we have also mentioned, subject to the principal objective of genuine economic and social cohesion.
Finally, I would like to thank all my colleagues in the Committee on Regional Policy and the whole of the technical team, especially the technical secretariat of the Committee on Regional Policy.

Bennasar Tous
Mr President, the Committee on Employment and Social Affairs agrees with the need for the coordination of Community policies concerning cities and an integrated overall view of them that will lead us to develop an effective urban policy. We are all agreed that the URBAN, INTEGRA and Interreg initiatives have been successful and that their objectives should be maintained in the future. European cities have improved greatly, thanks to these initiatives, but the effort must continue. Our cities still have problems of unemployment, social integration, immigration and safety which call for joint action by citizens and authorities to find solutions.
Planning must take into account the ageing European population, young people and the difficulty they have in getting their first home, children, whose safety is in doubt in many cities, the disabled, housewives, and the unemployed. Although all different, they all have one need in common: they want to live with dignity, and there must be a place for them in the city.
Nurseries, day centres for adults and the disabled, domiciliary care and neighbourhood services must be a priority, both as sources of employment in the service sector and because they are urgently needed to enable women to reconcile jobs with family commitments. Cities can be innovation laboratories for social and employment policy, turning problems into opportunities.
We call on the Commission to give priority to local employment initiatives and territorial pacts.
Urban sustainability will require greater awareness in the use of public transport, saving water and energy, and the management of waste and noise, which very seriously affect industrial and tourist-orientated cities. Local authorities must reduce property fever and land speculation, which do not bring progress, but rather instability and anarchy, and must provide for all these things without ignoring social conventions, by seeking development models that do not involve destruction and impoverishment. We urgently need to protect our European natural and historical heritage and develop parks and green spaces in cities. We must learn to make the city a more human place and become more human with it.
And, to conclude, I would like to remind you that a strict application of the principle of subsidiarity must not prevent the European Union from concerning itself with the weakest members of society by taking actions which, although they may be small and cost little, help to create a European social conscience.

Pollack
President, may I first congratulate my colleague Mrs Napoletano on her excellent report and the very constructive comments which I also fully support.
We in the Environment and Public Health Committee welcome the Commission's urban communication but we also want to register some concerns which we have articulated in greater detail in our opinion. Obviously, the Environment Committee's report, which we are also debating, feeds directly into this particular area. The environment and public health side of urban issues seems to be submerged in the debate about economic urban regeneration and spatial development.
We accept, of course, that problems of high unemployment and social exclusion are particularly serious in cities. Nevertheless, several OECD studies have indicated that improving quality of life in the urban environment not only improves life for its citizens but helps attract and create jobs and investment. Therefore, by improving the urban environment we can, at the same time, increase economic regeneration.
The urban communication lacks an overall vision in this respect and it is essential that environmental sustainability is taken on board as an important part of the urban equation. The eleven suggestions under the heading of environmental aspects in the report are crucial in developing urban environmental action. I do not really have time to discuss them here, although I would like to go through each and every one of them, but I stress their importance. I hope the Commission will pay very serious attention to them since they have had the endorsement also of the Regional Affairs Committee. We need a real cross-departmental urban affairs unit in the Commission to ensure that these matters are more coherently pursued than at the moment and that there is much more integrated development of policy than currently exists.
One final point, there is now a very strong move in the revision of the Structural Funds to relegate urban actions to areas simply covered by Objective 1 or 2. This is simply not good enough. Eighty per cent of the European Union's population is in towns and cities, most of which are outside these areas and the need to tackle social dislocation and urban environment problems refuses to fit neatly into these administrative and budgetary borders. The disappearance, in particular, of the urban community initiative into Objective 2 means that the flexibility needed to be able to develop environmental sustainability in our cities, where it is so desperately needed, is missing. Since we have no fund which has as its main aim improving urban environment, I strongly urge the Commission to construct its action plans in such a way that flexibility can be maintained.

Terrón i Cusí
Mr President, I would firstly like to add my congratulations to the draftsman of this report. I think it is a report which helps us to understand the problem and makes important proposals. We welcome both the Commission's communication and its conviction that we need to create a European Union policy that both includes and concentrates on our cities. I come from Barcelona, a city which is very proud of its status and its local government, and I know how much local government authorities look to Europe and how much the presence of Europe needs to be felt through our cities so that citizens can see and hear how important and how close to them it is.
The first proof that we have adopted such a policy, as the report says, will be the reform of the Structural Funds, and in that respect it seems to me that some interesting suggestions for reform have been put forward, especially the reform of Objective 2. But I would also like to express my concern that, at the same time, there is talk of abolishing such a beneficial initiative as URBAN. I think the retention of URBAN, together with the right sort of financing, is not incompatible with the reform of the Structural Funds, but is consistent with the guidelines we want to lay down for the reform of the Funds.
The Committee on Civil Liberties, Mr President, is also looking very carefully at what is going on in the cities. We think the subject of urban safety is highly important, and we also think it highly important that we in the Union should also work to create cities where people not only can, but also believe they can, go out at night. Only then can citizens feel free, and only then can we live in an environment in which violence, whether that of delinquents or that carried out by the private protection systems we see proliferating everywhere, will not go on and on increasing.
We must work against phenomena such as racism and xenophobia - and there is provision for this - and we must introduce a series of structural and social measures which involve the citizens and which strengthen the social fabric and civil society in order to do so. But we also need to help the cities to do what they can for themselves, what they have the competence to do, and to strengthen their competence and capacity in certain areas. And I believe, for example, that it is very important to establish systems of summary justice and community reparation for petty crimes, and support other, little-publicized, types of action, such as the drug and heroin addiction prevention and control plans which are being implemented in many cities, without much fuss, and which are extremely effective.
I think this series of measures would be important and I hope this report and the Commission's initiative will help to place this subject, too, at the top of our agendas.

McCarthy
Mr President, Commissioner, colleagues, I believe today's debate on both the EU's urban agenda and the report on regional planning and European spatial development perspective raises two very important and yet related dimensions of European regional policy. It is particularly relevant for Parliament to give its opinion on the future development of these policy areas given that under the British presidency the informal meeting of Ministers in Glasgow chose to devote one whole day to discuss both urban policy and the European spatial planning perspective. I congratulate Parliament's rapporteurs on their work and indeed the quality of both these reports and all of those people who have provided very good opinions to the reports.
The draft spatial planning document has now made progress, thanks to the push given by both the British ministers and indeed the group of experts. But this is not just some academic planning exercise; it needs to be supported by real decisions. We need to agree on how to plan for the future and making sure the results of such an exercise are accessible. The real audience are our citizens and the countries of the European Union need to bring governments closer to the citizens.
The key we believe is sharing best practice. We want real solutions for real issues. For example, the complexity of transport flows offers some areas new opportunities yet other areas get congestion and pollution. We also see the pressures on our urban and rural areas and yet we want to see the benefits of new technology spread right across many of our regional areas. We need to foster cooperation between the Member States and get common approaches to share problems and opportunities and get a better balanced development with an integrated approach across the sectors. We, in Parliament, want to be involved in translating the Eurospeak into real action and we look forward to the final draft of the European spatial perspective which we hope will be agreed at a future Council meeting.
One further aspect where the British presidency conclusions agreed that further work was needed was better consideration of the changing role and functions of urban areas. I welcome the initiatives that were taken at the informal meeting. Indeed, the Presidency document on urban exchange produced a very good exchange of experience on looking at a comprehensive approach to regeneration, to tackle problems faced by disadvantaged people concentrated in particular areas, to look at town centre management and to address urban quality issues. Very close to our hearts in the Parliament, was the emphasis on the need for community involvement and good government in order to improve the working of local democracy.
I would agree with Mrs Pollack that simply to include the urban dimension in Objective 1 and 2 programmes is not sufficient. We believe that the urban community initiative has, in fact, given very good public recognition to the urban ideas. We want to see that promoted. Therefore, it will be no surprise to Members of the House and to the Commission that in our meetings we are asking for a continuation of the urban community initiative.
At the informal Glasgow Council, children from across the European Union fifteen Member States were asked to design and present to ministers their ideal city of the future. Children, by providing a high-tech vision of a safe, sustainable city, were laying down the challenges of fulfilling our responsibilities. I believe that begins now. We need to create dynamic cities that respect people and the environment and involve community groups in the planning and process and in regeneration processes as such.
I was pleased to table amendments to Mrs Napoletano's report to look for a much more sustained approach with better funding for our urban areas and I hope the Commission will take these views on board when they produce their Agenda 2000 proposals, following negotiations with ministers in Council.

Varela Suanzes-Carpegna
 Mr President, Commissioner, ladies and gentlemen, Europe needs a planning policy. Just as Member States have their territorial policies, which include regional and local policies, we now need a European planning policy which incorporates the different national policies. This is a common objective: we need to combine economy and territory.
Planning is bound to influence future regional policy, because there will be no economic and social cohesion without territorial cohesion. We cannot go on designing and implementing isolated common policies, because we are doing something bigger than that, we are building a continent, and we need to do so in a spirit of cohesion and solidarity between the 15 existing Member States and those that are knocking at our door, in order to build the great Europe. So coordination, cohesion and territorial-based planning are essential.
Planning is synonymous with balance, or, if you prefer, with restoring balance. The great Spanish philosopher Ortega y Gasset once wrote that 'Europe is not a thing, it is a balance' . There are many bees, but one flight. And from that swarm of interests, planning should emerge as a policy to restore the balance of European spatial areas and policies.
I therefore support the ESDP and my compatriot Mr Novo Belenguer's excellent report, and I would only wish to restate here what I added to the report in committee: that the European Spatial Development Perspective should go beyond its obvious terrestrial dimension and include the maritime dimension it lacks at present.
We plead for the promotion of European ports, especially the small and medium-sized ones, which are a catalyst for local and regional development in backward and peripheral regions, and the development of all forms of maritime transport as an alternative to the congestion of land transport and the deterioration of the environment, with support from the Structural and Cohesion Funds.
And permit me one last comment. Speaking for this Parliament, I call for support from the Commission and the Council for the Atlantic side of Europe, an area where 50 million Europeans live, where three of the present four cohesion states are situated, two of them fully within Objective 1, and where there are 32 peripheral and ultra-peripheral maritime regions. These regions, from the Highlands of Scotland to Andalusia in Spain, demand their inclusion in real terms in the European Spatial Development Perspective and support for a trans-European maritime network which will boost European Atlantic and transatlantic communications as a special backbone for their future development.

Vallvé
Mr President, I would firstly like to express my appreciation of the fact that my group, the Liberal group, has been given a position in the order of speakers which now actually represents fairly the number of Members it has. We are discussing a regional matter here, as presented in two reports which I think are two sides of the same problem: the one on planning and the European Spatial Development Perspective and the other, Mrs Napoletano's report, on urban policy for the European Union.
Why do we need planning? The rapporteur has told us the reasons: to achieve greater economic and social cohesion, sustainable development, and geographically balanced competitiveness.
Obviously there is something missing from our planning system: the Treaty makes no provision for Community planning powers. But it is difficult to draw up regional policy unless there are instruments for territorial cooperation at European level, which transcend those artificial lines that constitute boundaries, and the Interreg initiative has already played an important part in cross-border cooperation, but there is still a great deal to do in that field. I am, therefore, strongly in favour of the creation of a European Spatial Planning Observatory.
Secondly, there is the problem of the cities. European policy must have a direct effect on cities as a whole, not only their sectoral aspects, in order to deal with the serious problems they have, as the rapporteur has mentioned, especially those of unemployment, social integration and immigration, which is also normally concentrated in these areas, and to develop citizen participation and improve the quality of life.
Agenda 2000 provides for the abolition of the URBAN initiative. This may make it difficult to implement the city schemes contained in that great compendium of measures, the proposed new Objective 2. In that respect, I consider that we ought not to waste the experience of city development that URBAN has provided for us.
Finally, I would like to say that this urban policy is not incompatible with regional policy, but rather complementary to it.

Baggioni
Mr President, ladies and gentlemen, the European Spatial Development Perspective (ESDP) is a document which, even though it depends simply on intergovernmental cooperation, aims to give a real political framework to Community, national and regional actions as regards regional planning. At Community level, this framework will help to give coherence to the various Union policies, and in particular to structural policy and transport policy.
If I restrict myself to discussing the matter which is closest to my heart - namely that of insular regions - and I hope you will forgive me, I note that the framework provided by the ESDP is not consistent with the resources currently included in the Structural Funds. Must we conclude that some regions, currently considered by the Union as being in great economic and social difficulty, do not warrant being included in Community spatial planning because the document scarcely mentions them? How is it possible that a document, which is so important, does not promote the new provisions of the Amsterdam Treaty, which quite specifically acknowledges the particular handicaps of insular regions and the urgent need to remedy this situation?
The ESDP, and the proposals for regulations on the Structural Funds appear to want to bypass these provisions and bring no message of hope to the 14 million people living in insular regions who are still waiting to be integrated into a major European regional planning project.
I would not like to appear too pessimistic, and so after congratulating the rapporteur on an excellent piece of work, I would very much like to welcome the promise reiterated on 8 June by the European Ministers for Regional Planning, who met in Glasgow, to think more seriously about the territorial development of the Mediterranean basin. In my opinion, this is one of the main challenges which faces the European Union at the dawn of the 21st century. I hope that this commitment will not, once again be relegated to a mere declaration of intent and that, here again, we shall not forget to take proper account of the situation of the very many insular regions in the Mediterranean.

González Álvarez
Mr President, I am going to refer in particular to Mrs Pollack's report, because we are both members of the Committee on the Environment. 80 % of the inhabitants of the European Union live in cities; yet less than 50 % of the European budget is allocated to dealing with their problems. We know that a very major share of the European budget goes to agriculture.
The European Environment Agency calculates that between 70 % and 80 % of cities with over 500 000 inhabitants have problems of air pollution, noise pollution and deficiencies in the general quality of life. It is true that the European Union has taken some sectorial measures relating to air quality - with the Auto-Oil programme, which was debated in the Committee on the Environment -, to water quality, and also to waste management. There is a campaign for sustainable cities, supported by over 320 local authorities. But, today, there is still no overall statement of the European Union's position on the quality of life in the cities, even though the Green Paper on quality in the cities was debated and published 7 years ago.
I would conclude, Mr President, by saying that we need an overall framework programme for air quality and the urban environment, with sufficient and coordinated funds. And we must allow for the fact that measures to deal with unemployment, poverty and poor health conditions must be inter-related, and finally that citizens need to be educated and their awareness raised to enable them to contribute to improving their quality of life.

Orlando
Mr President, I would like to make a few remarks regarding the Pollack, Napoletano and Novo Belenguer reports. The report by Mrs Pollack, on behalf of the Committee on the Environment, Public Health and Consumer Protection, should be underlined and deserves praise for the sensitivity shown towards the great problems facing us today, including the problems of our cities. The report by Mrs Napoletano on the Commission's communication 'Towards an urban agenda in the European Union' is commendable because of the extensive work done on the environmental and social aspects of urban problems and on related civil liberties, regional development and structural interventions. The committee also deserves to be commended for its own amendments which have made a very positive contribution to Mrs Napoletano's work. However, without a clear direction and a clear mission for Member States regarding urban policy, the current debate is obviously limited to a list of problems and solutions, even if it is an admirable inventory.
It seems to me that the most relevant aspects and most significant requests in the motion for a resolution are: firstly, the definition of a European strategy for urban policy and the coordination of all Community policies concerning urban areas; and secondly, the need for European support of European strategies on sustainable urban development.
The report by Mr Novo Belenguer is particularly commendable, because it attempts to solicit and develop a political perspective for the technical proposals for informal work on regional planning: there is a return of the strong relationship between cities and overall regional planning policy, although with some concerns that I believe should be underlined. First of all, the major trans-European networks risk connecting only the major metropolitan areas, and so are likely to intensify metropolitan concentrations. I think, therefore, that we must be aware of this risk and avoid a situation where the needs of small and medium-sized cities are totally forgotten. We must be aware of this, because otherwise we risk making the stronger cities much stronger and the already congested cities much more congested. The risk is that we will not give priority to taking advantage of areas that are still natural and making use of our environmental heritage. Instead, priority must go to reducing the process of urbanization in Europe. We have a point of reference: ' NETWORK AND NATURE 2000' . It should be taken as the point of reference and we must abide by the principles of this document for any intervention in the matter.
I have two more remarks that I would like to make regarding what has already been said. First of all, I, or should I say we, see the URBAN project as positive. I also have the experience of a city like Palermo which is one of the 49 urban areas that has positively implemented this project. However, maintaining this initiative, which is very positive, must not penalize small and medium-sized cities - again I am back to the same topic - and so provision must be made for forms of cooperation between cities.
Secondly, as regards the new Objective 2 which covers both urban and rural areas, guarantee clauses should be included so that when individual Member States make their selection, they cannot entirely overlook rural areas and just select strong areas that are inevitably, in all countries, urban areas.
For this reason we are still awaiting an action plan for cities from the Commission which, before this Parliamentary term is over, will finally give concrete expression to the strategic guidelines that have emerged from today's debate on the problem of cities in Europe.
Lastly, I have just a couple observations. Cities are the most complex achievement of the human race. The entire complexity of life is represented in cities: culture, transport, economy, art, health and sport. The human race has not achieved anything more complex than the city. The overwhelming majority of European citizens lives in cities - 80 % - and the greatest wealth is produced and traded there. Despite this, cities seem to symbolize places of hardship that cannot be enjoyed. To make our cities enjoyable and suitable to be lived in is, I believe, what our citizens want and the obligation of the current city governments; however, it is still not an organic and strategic objective of the European institutions. We all want this debate to underscore the need to build enjoyable cities worth living in throughout Europe.

Blokland
Mr President, the Pollack, Napoletano and Novo Belenguer reports have quite rightly been clubbed together on this afternoon's agenda. They share one thing in common: neither urban policy nor regional planning policy have any foundation in the Amsterdam Treaty. Both were left out of the Treaty. Attempts have of course been made in the meantime to incorporate these matters into the European agenda. We are only partly in favour of this. Anything that can be done locally should be.
Fortunately, the Pollack report is short but forceful and not too demanding, unlike the Napoletano report. When I read the reports, I did wonder why there was such a desire for a Community-wide policy. One of the reasons given was that there were major problems in towns and cities throughout Europe and that over 80 % of the population lived in towns and cities. Can this really justify the implementation of a European urban policy? I think not. There has to be a real benefit and I have my doubts about this. Anyone who has spent any time in local or regional politics will know that the problems involved are often very specific and require specific solutions.
Only in the area of regional planning do I see opportunities for Europe. But even then, you would need to have a very good idea of what would and would not be possible on a European level. The European Spatial Development Perspective is a very good way to get discussions going but no more than that. It is an illusion to think that it would be possible to harmonize regional development policy in the various Member States. Fortunately, everyone is agreed about this.
The approach adopted by the ESDP is therefore quite a cautious approach. It merely raises a number of very general assumptions and perspectives. Europe itself has a great deal of influence over regional development. Just think of the internal market, transport systems and agricultural policy. There is then already some control over regional planning on a European level. There is, in my view, also a certain amount of potential for ecological development and the preservation of ecological corridors. I think these are important elements in the ESDP document. If we are to accept this sort of approach, I think we will need a formal Council of Regional Planning Ministers, although I suspect that this will also be the most we are likely to achieve.

Amadeo
Mr President, I would like to rise above all the repetitive talk we have heard these past few years on the urban environment. It has become fashionable to say: ' the city for the city, the province for the province, the region for the region, ' in a false autonomy that, in substance, creates not progress but regression. Indeed, without broad and comprehensive planning, we end up making incomplete choices that never solve the problems of citizens or of the businesses that offer jobs. Do you realize that seven years have passed since the Green Paper on the urban environment was published? Yet, despite many initiatives, virtually nothing has been achieved. Do you realize that because it does not want to be unjustly accused of interfering in the day-to-day management of European cities, the European Community, which got off to a good start, has never fulfilled its main role which is to define a framework for urban policy?
We are convinced that Europe's urban environmental policy, launched by the European Parliament's own-initiative report in 1988 and included in the 1990 Green Paper, is today the only instrument capable of promoting an integrated approach to the problem of European urban areas and defining a Community strategy focusing on at least three important and specific problems: first, measures to improve the quality of life and the environment in European urban areas; second, the elaboration of a Community project for sustainable cities; third, the definitive inclusion in the Structural Funds of financing for areas suffering from urban decay.
In the light of this, how can we not interfere to coordinate and harmonize? At the second European Conference on Sustainable Cities held in Lisbon in 1996, it was shown that pollution in our cities was deteriorating at an exponential rate and that we are far from making our dream of a clean and healthy environment come true in Europe, because urban pollution does not seem to take account of existing national or Community legislation. Moreover, the unevenness of Community interventions leaves us puzzled when we see that over half of the Community budget is aimed at rural areas while 80 % of the population actually lives in urban areas. So, yes, we support the Pollack report and, yes, we give our unconditional support to a stronger Union policy on the urban environment. Our job is to improve the lives of consumers, certainly not to chase after the autonomous yearnings of some dreamer, or worse, some profiteer.

Frutos Gama
Mr President, ladies and gentlemen, I would firstly like to congratulate Mrs Napoletano on her splendid report and the great determination with which she has taken on the by no means easy task of gathering together all the opinions and ideas on the urban problem that have been expressed in this House in the course of its preparation.
It seems to me that this report highlights two fundamental issues. The first is that almost 80 % of European citizens live in urban areas. The second, which is becoming ever more obvious, is that the European Union needs to unify and coordinate its own policies for those areas. Both issues should mark a starting point for a Community strategy to achieve the harmonious development of the European geographical area.
But there is a third element in this report on which I should like to dwell for a moment. If we want all kinds of citizens to feel at home in the cities - adults, traders, artists, young people, entrepreneurs, immigrants, women -, the European Union, as well as the governments of the Member States, must combat the effects of exclusion and the division into haves and have-nots which is at the root of the serious conflicts we are seeing every day in European urban areas.
Women, ladies and gentlemen, form a social group whose needs and difficulties in the cities tend to be minimized. The European Charter for Women in Cities, a discussion paper sponsored by the Equal Opportunities Unit of the European Commission in 1995, contains some of the key ideas that can help us in our general thinking: the opportunity of gaining access to employment; the number and quality of neighbourhood services, especially those relating to child care; access to decisiontaking authorities in cities; and the issue of safety in urban areas.
Ladies and gentlemen, European urban policy needs to recognize these specific women's issues, as summarized in Mrs Napoletano's report, because women urgently need to become involved. We must encourage their participation in decisiontaking authorities and increase exchanges of information and innovative projects. Their point of view needs to be taken into consideration when determining socio-economic and cultural indicators for the cities, and our male colleagues should be made more aware, so that they will take more notice of women's points of view.

Rack
Mr President, more and more Europeans live in cities. As has often been pointed out, four out of five EU citizens are city-dwellers. Cities are thus also enjoying increasing prosperity and their infrastructure is improving all the time. In this connection, I am pleased that my city, Graz, was recently selected as the European City of Culture for the year 2003. However, cities are not only places of beauty and culture; they face growing problems with poverty, unemployment and exclusion. They have more crime and are less safe, and they suffer environmental damage on a very large scale. Against this background, it is obvious why urban issues are crucially important within the framework of structural policy and why they must continue to be so, but - and this cannot be emphasized often enough - not everything should be regulated at European level. We must not get carried away; we must take account of the principle of subsidiarity not only in speeches but also in our very practical political work.
A second important aspect should be mentioned in this connection, however. European structural policy, and European urban policy too, cannot be defined from the top down; it must be a bottom-up process and we must take partnership with the cities seriously.
Thirdly, the principle of divide et impera has often been applied in the past, with much, therefore, being imposed from the top. We must adopt a different position: we must support networking by those involved, and we must support what has already been discussed here today, namely the sharing - and challenges - of best practice. Diversity is out there in the European cities.
The excellent reports before us today - especially the reports from our committee by Mrs Napoletano and Mr Novo Belenguer - take account of all these issues to a substantial degree. However, in some respects the enthusiasm goes a little too far, and I have thus attempted, with my amendments, to modify one or two points. This is not directed against the issues themselves; rather, my intention is to ensure that we should also, and above all, respect the reports submitted by the Commission and the aims which they contain, and also take this respect seriously.
I have nothing against URBAN, but we must take ourselves seriously and thus integrate URBAN and its objectives into general Community policy and structural policy, even if we would prefer to have our own programme. I have nothing against the initiative for cities, but we must not forget the region around the cities either. I have one final point: I have nothing against a further extension of the right to vote in local elections for all citizens living in our European Union, but first things first, we should be concentrating on EU citizens above all.

Spaak
Mr President, as Mrs Napoletano's report emphasizes - and I would like to congratulate her on her work -, it is essential that the European Union tackles the issue of urban policy, since a large majority of Europeans live in cities. As long ago as 1995 I was very concerned by this problem and tabled a motion for a resolution on large conurbations which suffer many of the problems which beset today's society. These include: unemployment and its associated disastrous effects; poverty and the homeless; large-scale and small-scale crime; the lack of social infrastructure; emigration of the welloff to the more pleasant outlying districts with the consequent deterioration of the environment of town centres; lack of funds for the development of public transport; the deterioration of local infrastructure; and very weak support for historical and architectural heritage.
Even with its limited resources, the URBAN projet has produced good results in the less advantaged parts of our towns. Should we not be concerned that its initiatives, incorporated within the huge canvass of Objective 2, might lose their effectiveness there. We need a regional planning policy which respects the balance between habitat and green spaces, meeting and leisure spaces, if European towns are to remain attractive. The proposal for an urban audit is, therefore, an excellent one and it will be useful for all our towns to think about this.
Finally, I fully subscribe to the importance which the report gives to the participation of citizens in local democracy, and, therefore, to the compulsory and unrestricted application of the Treaty as regards the voting rights of European nationals in municipal elections. I hope, therefore, that the Belgian government, which has dragged its feet on this matter, will finally implement this provision as soon as possible.

Querbes
Mr President, the report by our colleague, Mr Novo Belenguer, expresses its agreement with the main aims of the ESDP project and emphasizes the shortcomings of an overly urban and continental vision of Europe. It demonstrates the inconsistencies with Community policies and the aims of the ESDP. But is there not a more basic criticism to be made of this draft plan?
Is it right that the ESDP should start with the needs of business rather than those of people and propose that the territory should be structured so as to benefit business by achieving a high level of productivity. With this approach, the plan hardly makes any reference, if at all, to the human dimension, that is, employment, culture and education. It ignores the role played by public services and local policies in terms of land use. It does not say anything about local resources, with the exception of water, which lead to human settlements and agricultural, industrial and energy activities. Last of all, it ignores the strategy of large groups and financial bodies which have a significant influence on the planning of the land.
The current plan for Community spatial planning responds, in my opinion, to one fact and to one project. The fact is the land crisis, at the centre of which lies the competition for land. The price of this crisis is the transfer of the considerable wealth from the population to economic and financial activities. It is the forging of imbalances in land use and the concomitant urban overdevelopment, rural abandonment, saturation of the main axes of communication and social and environmental destruction. The project is the result, stressed in the ESDP, of the implications of the introduction of the euro and the pursuit of economic liberalization. What additional problems will be created with the arrival of the euro and the enlargement of the Union? And how should we deal with this?
The rapporteur proposes putting a fence around European policies to encourage the development of social and economic cohesion and lasting development. He hopes to see, as I do, democratic development of the ESDP and he points out the priorities in the plan as regards the harmonious development of employment and activities in the various regions of the European Union. But will this be enough? Should we not be thinking about quite a different process for developing the ESDP based on the needs of the citizens and the territory, an approach which would ensure that economic and financial activities met with and satisfied these needs.
I hope that the discussions organized within the Member States and at Union level will make it possible to listen to the needs of the people and of the land and that the final plan will be centred around jobs, as well as the social and environmental aspects.

des Places
Mr President, the report by our colleague Mr Novo prays that there will be a European regional planning policy. This is an excellent initiative. In fact, rural areas represent approximately 80 % of the Community territory, and a balanced regional planning policy depends on their vitality. The ESDP document notes that European agriculture will continue to play a principal role in the development of the vitality of several rural regions. Mr President, the Commission must also be well aware of this and take account of this in its proposals for reform of the common agricultural policy. Our rural areas are currently undergoing profound change which can be seen in the diversification of activities and all too often, unfortunately, in abandonment. In some regions, agro-tourism will not be enough.
It is, therefore, essential that we respond to the challenge of this change and avert the dangers so that, by contrast, we derive as much benefit as possible. Thus, intensive development can encourage investment, provided that quality and the environment is not sacrificed to quantity. Quite the opposite. Diversification can offer new opportunities for the promotion of our cultural and natural heritage, as well as the development of rural tourism affecting small- and medium-sized firms and craft industries. Extensification and marginalization can create better conditions for the protection of the environment and reafforestation, always provided that we can prevent a haemorrhage of manpower and the abandonment of agricultural holdings by using land in a different way.
We must recognize that Community action has sometimes had very damaging consequences on an economic and social cohesion of which we are often voluntarily proud, but it should be restored. Thus, the abandonment of some of our countryside has been aggravated by the implementation of the 1992 common agricultural policy and the reduction in agricultural prices. The new reform of the common agricultural policy which, amongst other things, involves a marked reduction in prices, can only further unbalance regional planning through a major reduction in the number of farmers.
So we hope that, rather than claiming new powers, the European Union will simply consider the effects of its policies, and in particular those of the common agricultural policy, on the balance of the Community territory, in order to avoid negative consequences, and that it will insist that the health and the well-being of animals will be taken into consideration in future WTO negotiations...
(The President cut off the speaker)

Cellai
Mr President, considering that there is broad agreement with the report by Mrs Napoletano, the European Commission's document is a basis which can be used to launch a serious and constructive debate to outline the terms of a Europe-wide urban policy. It is clear that a new strategy is needed to strengthen or restore the important role that European cities must play as regards social and cultural integration, the supply of resources, sustainable development and as a pillar of democracy. The purpose is not to develop Europe-wide urban policies in areas that can be better dealt with at local or regional level but rather to facilitate solutions and their application at European level, adopting a more targeted approach based on the instruments that exist in Member States and at Community level, with increased cooperation and coordination at all levels.
Most cities today are a hodgepodge of many realities: business districts and residential neighbourhoods, historical centres and outlying dormitory towns, office areas which are deserted at night, shopping centres, student neighbourhoods, etcetera. Many neighbourhoods in the outlying areas are host to acts of vandalism and crime arising out of a lack of job opportunities or social and cultural life that keeps them isolated. To regain control of urban areas there must be better regional planning that revives the true notion of neighbourhood and reintegrates huge peripheral areas into the urban fabric, and this must be accompanied by efficient public and private transport.
In our opinion, cultural activities must be promoted as a feature of development in cities, regions and throughout Europe, given the wealth of heritage available to us. This will have two effects: one direct effect, that of encouraging the creation of jobs that are often permanent; and one indirect effect, connected to what is produced and which could offset the loss of jobs in the primary and secondary sectors. So, promoting the development of cultural activities as a factor of social and economic cohesion must be one of the new directions. For all this, it is fundamental that we increase the amounts earmarked for the Structural Funds, give more importance to studies on the theme of new services, and give attention to all the possible forms of tax relief, beginning with a reduction in the Value Added Tax on work to restore, recover and preserve cultural assets. Another area where cities can and must play a fundamental role is in the conservation of the environment, because the most serious environmental problems are concentrated in cities.
Therefore, when planning and developing future strategies, greater attention must be given to urban development and rehabilitation of the decaying outlying areas, since this will favour synergy between specific actions at both local and regional level.

Walter
Mr President, ladies and gentlemen, I should first of all like to express my appreciation of the excellent work undertaken by Mrs Napoletano and Mr Novo Belenguer. Both reports underline the most important issues arising in the closely linked debates on regional and urban development and put forward a number of valuable suggestions in terms of developing these very new European policy areas further. I should like to make three points. Firstly, the various European Union policies - such as agricultural policy, structural policy, transport policy or even competition policy - directly affect the spatial structures of the European Union, but have hitherto done so, as regards regional planning, in an uncoordinated and incoherent manner. Furthermore, in terms of Europe's population structures, its transport, energy and communication structures, the spatial distribution of its economic activity and its environmental links, Europe forms an interconnected network. We must, therefore, move away from our often very limited viewpoints and develop a European perspective on the impacts of spatial planning, both for the territory covered by the current European Union and also for an EU which is enlarged towards the East. A European observatory can contribute substantially to this process. However, clear progress towards collating basic statistical data on these issues is even more important.
Secondly, developing a European perspective and coordinating it at European level does not mean that we must shift competencies to Europe to a substantial degree. What is vitally important in this respect is that we adhere to the principle of subsidiarity and respect for established local government traditions, and that we ensure the participation of local actors.
Thirdly, I would like to make a point about the cities. It would be a grave mistake to view the cities in isolation. The very complex interaction between urban and rural areas must be taken into account. It is true that 80 % of Europe's citizens live in urban areas. More than two-thirds of Europe's wealth is generated in the cities. Yet this is only possible against the background of the rural areas' ability to balance out economic, social and ecological interests. It would be a mistake to focus solely on the major urban areas. It is the smaller and medium-sized towns and cities in the rural regions, in particular, which perform an important bridging function and shape the economic and social landscape of Europe. We are still at the beginning of spatial planning at European level. If we take on board the conclusions of the two reports submitted today, we will be taking a major step forward.

Fernández Martín
Mr President, up to now the accent in the regional policies we have been implementing has been on development in the less favoured regions of the Union, as a means of advancing economic and social cohesion. Yet in recent years more and more people have been calling our attention to the fact that we ought to be placing more emphasis on the citizen as the beneficiary of our environmental and planning policies.
The Commission has already pointed out this trend in its Europe 2000 communications and, more recently, in its Europe 2000+ document on planning, and Parliament voted in favour of the report, of which I myself was the rapporteur, by an overwhelming majority.
It is very important that we should not forget the peripheral and ultra-peripheral regions, the subarctic areas and the sparselypopulated mountain regions, so as not to aggravate geographical imbalances. But Europe, Mr President, is, first and foremost, an urbanized continent. The most serious cases of poverty, marginalization, unemployment, social exclusion and crime are now found in the urban areas of the Union.
The bigger the cities, the more serious these problems are. In the urban agglomerations of London's docks, next door to the City itself, there are the most appalling cases of human misery. The same applies to Naples, Amsterdam or Madrid. None of the major cities of Europe is free of this problem today. That is why I share the Commission's view on Agenda 2000, which does not propose a reduction in urban development funds, as some critics seem to believe regarding the URBAN programme, but does, in fact, seek to restructure those funds to create a greater and more efficient volume of investment to support development in the urban areas of the Union.

Eisma
Mr President, I have three brief comments to make on these three excellent reports. Firstly, I am pleased to see that Mr Novo Belenguer, in particular, has recognized how important proper coordination of regional planning policy is to sustainable development - particularly with regard to nature conservation policy - and has included this in one of the points of the resolution. I myself have tabled an amendment, establishing a link between the habitat and birds directives and the instrument involved in coordinating regional planning. This is because the Natura 2000 initiative says that every Member State must leave 20 % of its territory to nature in order to protect biodiversity in Europe. There is, however, scarcely any coordination between the Member States. Some countries have too few black grouse and others far too many. Coordination of this kind is a very good way of implementing a nature conservation policy within the European Union.
My second comment relates, in particular, to that part of Mrs Napoletano's report where she says that we should support Agenda 21 and consider introducing a new budget line. I can agree with this because I am chairman of a local 21 group in The Hague and can see the importance of promoting a system whereby we can exchange experiences.
Finally, Mrs Napoletano and Mrs Pollack have pointed out that 80 % of the population live in towns and cities and that the European Commission wants to scrap the URBAN initiative. We are sorry to learn that the URBAN initiative will also be disappearing from Agenda 2000 because it forms part of Objective 2, although towns and cities in areas not covered by Objective 2 are excluded from the urban system.

Novo
Mr President, ladies and gentlemen, the draft European Spatial Development Perspective is an approach to planning matters which I consider limited, inasmuch as it places little importance on the problems of the human dimension of the occupation of land, that is to say, on its cultural and educational aspects and the question of social exclusion. Similarly, it does not enquire as to the role public services, regional policies and specific economic activities should play in rational planning, particularly through giving the attention that is desirable and necessary to the peripheral and ultra-peripheral regions and the islands.
The report by Mr Novo Belenguer, whom I take this opportunity of congratulating, is in its turn a welcome reminder of the need to pursue a policy of economic and social cohesion with a strategy of sustainable development and balanced competitiveness, although it might have dealt with the gaps and omissions in the European Spatial Development Perspective at greater length.
In the context of institutional politics, however, we find Mrs Napoletano's report - and I congratulate her as well - more balanced, fairer and more realistic. It also supports the creation of a European Spatial Planning Observatory, but accepts the present informal framework of a Council of Regional Planning Ministers and recognizes the potential for development of urban and territorial planning policies, based on increased cooperation, dialogue, partnership and subsidiarity.
Because we consider this vision more appropriate, we have suggested some amendments to try to give the Belenguer report the same political and institutional rationale and render the two texts more consistent with each other. This is because we do not think standardizing planning policies at Community level is the way to find solutions to problems which often are and will continue to be specific and varied, and for that reason will continue to depend essentially on the proper discharge by the national, regional and local government authorities of their responsibilities.

Karamanou
Mr President, the adoption of an integrated European policy and a strategy for the viable development of towns and cities today takes on a certain urgency as, in many towns and cities, the downgrading of the natural environment, the problems of political, cultural and social exclusion, and the problems of crime and traffic chaos have brought about a serious deterioration of the lives of millions of people.
Moreover, the crisis in our towns and cities places the competitiveness of the European Union, the mechanisms of integration, and the policy of economic and social cohesion in great jeopardy. The Commission communication and the excellent report by Mrs Napoletano constitute a positive response to the new challenges and a global approach to the problems in the framework of a broader spatial planning policy. We need to act now in order to secure a minimum quality of life in the towns and cities of the future.
In my opinion, priority must be given to the following.
First, we need to consider the creation of a new equilibrium between the large urban centres and the countryside.
Secondly, the strengthening of ties between small and medium-sized towns is essential.
Third, we need to create technological and industrial parks and cultural and recreational centres, with the active participation of local self-government and social organizations.
Fourth, we must give consideration to the needs of children, the elderly and people with special needs, during the planning of towns, buildings, roads and means of transport.
Fifth, we need the necessary reforms aimed at maintaining a high level of social protection, in view of the projected increase in the number of people over 60 years of age by 37 million over the next 25 years.
Sixth, we should look at the provision of resources for social infrastructures, day nurseries, and up-to-date homes for the elderly, in the light of the reform of the Structural Funds.
Seventh, we must provide public transport which is accessible to all and which will respect the environment and reduce the use of private cars.
Eighth, we need to consider measures aimed at combating racism, xenophobia and at crime prevention, in other words, measures to safeguard the rights of the citizens of Europe to a life that is free from fear and insecurity.
Last but not least, we must promote the active participation of women in all decision-taking authorities and in the planning of the societies and towns and cities of the future.

Hatzidakis
Mr President, after first congratulating Mrs Napoletano on the very good report she has prepared, I would like, in turn, to dwell on a few points which I consider to be important in the issue of "the urban environment and the European Union' .
Bearing in mind the significant role played in the economic and social life of the European Union by towns and cities and large urban centres, in which a very large part of the population lives and where more than two thirds of the wealth of the European Union is concentrated, I think that the Commission must promote a European urban strategy that will acknowledge the vital role of towns and cities, as well as the special problems they face, one which is also aimed at coordinating the various Community policies which may affect urban regions either directly or indirectly.
Of course, a European urban strategy cannot be understood in isolation, but only as an integral part of a broader spatial planning policy, which is mentioned in the other report we are debating jointly today, that of Mr Novo Belenguer. I would also like to support this report wholeheartedly, as it contains some very good points and observations relating to the already ambitious Commission communication on a draft for a European Spatial Development Perspective.
Be that as it may, what I would like to dwell on at this moment are some more specific issues. Given that the Community initiative "URBAN' , which for the most part has been extremely successful, is nearing its end without any possibility for its renewal, as with most Community initiatives, greater emphasis must be given to the innovative actions of Objective 10 of the European Regional Development Fund relating to the urban environment. In this regard, the Commission could examine the idea of strengthening small and medium-sized island towns which face, in addition to the other difficulties, all the particular problems which arise because of their island status, not on the basis of the criterion of an upper limit of 100 000 inhabitants, as provided for in Objective 10 of the ERDF, but of the influence they wield as key towns and cities, that is, as poles of economic, social and cultural development within the broader geographical unity with which they are associated.
In addition, I consider it useful to point out the following.
Firstly, incentives must be given, in the context of relevant Community policies, for the restoration and upgrading of historical buildings for cultural, social or economic use.
Secondly, special emphasis must be given to urban tourism, which could constitute the basis for growth for many regional towns and cities.
Finally, we must encourage the accession of regional towns and cities to Europe-wide networks and, more generally, strengthen coordination and cooperation at all levels between towns and cities and the European Union.

Papayannakis
Mr President, I would first of all like to congratulate Mrs Napoletano and Mrs Pollack on their excellent reports and to stress that I think we need something more, something much more, than simple communications from the European Commission, which may indeed be laudable, but which do not have much practical value.
The urban environment is something akin to a biosphere for the vast majority of European citizens. The enormous problems of the quality of life they face, even at the level of public health, are being faced additionally by the European Union, with relevant programmes for air quality, for regional regeneration and for cultural interventions. These programmes are often useful and even pioneering. However, the Court of Auditors itself has pointed out that they do not have multiplicative outcomes or a global logic and usefulness, simply because they do not have a specific framework for global consideration and a global perspective.
The citizens of Athens, for example, are very well aware of this. Of course, ensuring the cohesion and the perspective of such interventions in the city belongs to the national, and chiefly to the municipal, authorities which, in Athens, for example, have not done their job, beyond a short-lived push forward for political reasons.
Nevertheless, they can and they must do their job. And I think they will be greatly helped by general Community legislation, a programme, a framework directive which will put in place a general framework of principles, guidelines and criteria, so that whatever relevant programmes are debated and adopted will take on significance and perspective.
It is about making a qualitative change, which I think will reduce arbitrariness and waste and will increase the overall gain of citizens from any Community intervention.

Howitt
Mr President, having had the pleasure of chairing the European Parliament Hearing on the Urban Communication with our rapporteur, Mrs Napoletano, and having chaired an association of ten towns in my own region in the United Kingdom before being elected to this Parliament, I welcome the progress being made towards an urban agenda for the European Union. Not simply do the vast majority of European citizens live in towns and cities but such urban areas include pockets of deep poverty and incidences of racism and social exclusion and of environmental degradation which demand action at European level. Yet the action programme, to be proposed by the Commission, is not yet a fully-fledged urban competence for the European Union. Initiatives to benefit towns and cities still have to be made by diverting powers from other headings. The next revision of the European Treaty must remedy this deficit.
The proposals within structural fund reform which will enable European support for housing projects and for the regeneration of derelict sites for the first time, are welcome steps forward in meeting urban needs. But as other speakers have made clear, the abolition of the urban community initiative would dismantle European support in 110 cities benefiting half a million people across Europe. Retaining a separate urban community initiative would allow innovative and trans-national urban projects to be maintained as well as aid to the majority of people who live in particular in small and medium-sized towns. No European-aided town in the Nordic countries or in Austria, currently exceeds the 100 000 population mark; their needs must not be ignored.
Meanwhile, welcome as the newer urban strand in mainstream Objective 2 structural funding would be, the proposed 2 % population to be aided is a feeble figure. The 5 % proposal requires far more serious consideration.
In my own constituency, in Basildon, European ADAPT funding is currently being used to appoint a town centre manager to combat the drain of shopping to out-of-town centres. Today, in the Parliament, we have a visitor who is working to increase the recycling of waste in London from less than 10 % to 50 % by the year 2005. These are the exciting urban regeneration initiatives that we should be supporting. Are we up to the challenge?

De Esteban Martin
Mr President, ladies and gentlemen, I should firstly like to thank the rapporteur and draftsmen of the opinions for having drawn up this report which opens our dialogue on the future of urban development. It is essential that we recognize the need to pay more attention to the problems of cities at Community level. Nevertheless, as you are fully aware, we have no mandate to create a common urban policy. We do, however, need to try to formulate a coordinated and consistent response to tackle the growing number of problems affecting our cities.
European cities are having to deal with an ever-increasing number of problems, from unemployment, environmental deterioration and traffic congestion to poverty and social marginalization, housing problems, crime and drug addiction. A more coherent programme will enable cities to deal with these problems more effectively and make the best possible use of their resources.
As a member of the Committee on Civil Liberties, I would like to emphasize, in particular, the need to direct our efforts towards the fight against marginalization, racism, xenophobia and drug addiction. Many immigrants make their homes in the cities and, therefore, one of our objectives is to create appropriate polices for integrating them into the community, making it possible to comprehend the problems and interests of minorities within the urban population, encouraging immigrants to participate in community life and providing them with information on the resources and services available to them.
In that connection, it is also essential that we train social workers and partners and campaign against xenophobic and racist activities.
As far as crime is concerned, we all know that urban areas are the most seriously affected. The growth of crime is a serious threat to the respect of citizens' rights in the Union, and for that reason we must endeavour to go on creating a Europe of safety and justice, encouraging the competent authorities to maintain progress in the exchange of information that will benefit all the citizens of the Union.

Gutiérrez Díaz
Mr President, ladies and gentlemen, Mrs Napoletano's report, the contents of which I entirely agree with, highlights and gives due importance to the need to define an urban strategy that is clearly differentiated, as regards both powers and institutions, from our regional strategy, in view of the important roles of two sub-State authorities - the autonomous community and the city council - in the construction of the European Union and the creation and implementation of its policies. In that context, and from the point of view of the objectives to be achieved at the beginning of the year 2000, we must ensure that local autonomy is protected and municipal authorities are given full responsibility in the partnership. In my opinion, however, the limited attention given to the municipal authorities in Agenda 2000 gives us cause to fear that the amendment of the regulations, even if we acknowledge that they have some part to play, will in practice be of little effect.
It is quite obviously insufficient to relegate the urban problem to Objective 2. This clearly means that the structural policies of Objective 1 will have to meet the needs of large and medium-sized and country settlements. At the same time, we call on the Commission - please do not forget to pass this on to Mrs Wulf-Mathies, Commissioner - to decide in favour of keeping the URBAN initiative - in view of the positive results of its implementation in over 100 European cities -, improving the resources allocated to it and making good use of the information that has resulted in its being applied, as Mr Howitt reminded us earlier, in over 100 European cities.
If we want to make European citizenship really meaningful, citizens must see it at work in the first institutional layer that represents it: the town hall. To forget that, Commissioner, would be a serious mistake, which we hope the Commission will avoid.

Imaz San Miguel
Mr President, I would firstly like to congratulate the rapporteurs, Mrs Pollack, Mrs Napoletano and Alfonso Novo, for the reports they are presenting today. And I believe they all reach the same conclusion: that the European Union should seek a coordinated urban strategy, since the Union is already having a decisive influence on our cities today.
Furthermore, they also make it clear that our urban problems need a global approach, as regards both the internal problems of the cities and the relationship of cities to geographical areas. They then go on to identify the most urgent needs the cities are facing: unemployment, which is a serious problem for social integration; citizens' safety and their participation; and the environment, and specifically the quality of life in our cities.
They also mention funding. I share the concern over the abolition of URBAN, which has produced so many successful results within our Community urban policy. The new Objective 2 covers a different set of issues. It deals with the problems of industrial decline, rural development, urban areas, and fishing subsidies within a general instrument comprising a total sum which, let us not forget, is reduced by 13 % in constant ecus during the 1999-2006 period in relation to the amount that is allocated to all these Objectives at present. I must, therefore, express my anxiety about the financial aspect, especially since medium-sized cities may find themselves at a disadvantage when the funds are shared out. The European Union should, therefore, endeavour to concentrate its attention essentially on those aspects which have a Community dimension.
And I would end with this thought, Mr President: it is also essential that we should do something about cross-border urban areas, where there is a real problem Europe can do something about. I would say that I live in a Basque Euro-city, straddling a national frontier, on the main road from San Sebastián to Bayonne. And there is regrettably no Community legal framework at European level to extend the significant increase in cross-border cooperation to cover planning matters, so as to improve the quality of life of our citizens.

Ephremidis
Mr President, the reports and the debate that has been going on for so long have provided a sampling of the many serious problems that the urban Community territory is suffering from. It is clear that there are more problems, and the outlook is that they will get worse and they will multiply. What is noteworthy and surprising in this? Nowhere does anybody name the main causes, those guilty of this situation, that is, the jungle of the law of multinational interests and unbridled competition, which has run amok, in the pursuit of profit in the context of the arrant free market.
We run the risk of being regarded as hypocrites and accomplices in the cover-up of illegal interests, or, of it is not the one or the other, we run the risk of being regarded as political and parliamentary masochists, continually bemoaning the problems, not naming the causes, and consequently not confronting the problems in order to find a solution.
Let this Parliament at last rise above these syndromes and let it show that it truly represents the tormented people in the urban centres of the European Union.

Piha
Mr President, cities are too often seen in terms of black and white, either as places for the rich and privileged, or as problem areas. Cities have their own, individual problems but cities are, above all, centres for innovation and they are in the forefront of development. Besides, most new jobs are now being created in urban areas.
Last year it was emphasized at summit conference level, no less, how Europe's immense unemployment problem needs to be brought under control. Investment in urban areas and seeing them as places of opportunity rather than as problems must be one of the principles of the European Union too. Structural funding reform should attend to the targeting of EU regional funding at areas which are more certain of producing the result we want, that is, the improved welfare of citizens, and not squander resources in developing desolate or impoverished areas. The spill-over effect will mean that prosperity will spread out of the cities to other regions. By strengthening opportunity in the cities we improve prospects for rural regions.
At this time, regional policy thinking is still on the wrong track when it comes to funding. Although 80 % of EU citizens live in urban areas, over half the Union budget still gets spent in rural areas. It is easy to muse that the EU is one big rural project that ignores urban areas and urban folk alike. There is no longer any great trend for people to move to cities, but there is a large proportion of people who are staying and who enjoy being in the city.
Although the details contained in urban policy are ultimately the province of decision-makers in individual countries and regions, as they should be, the European Union has its own important duty to solve in particular problems that are common to all. Urbanization has brought with it new problems for society, such as exclusion, drugs and environmental problems. We certainly want everyone in the future to enjoy clean drinking water, fresh air and a safe city environment. One unfortunately good example of urban environmental problems is the collection of waste and recycling. Brussels, for instance, would seem to have a lot more to learn along these lines.

Ojala
Mr President, first I would like to congratulate Mrs Napoletano on a very successful report. I am especially glad the report gives great emphasis to the importance of the opportunities for residents themselves to have a say in urban policy. There can only be full-blooded development of cities when it leads to city dwellers having an influence on decisions that affect them. That is why different forms of residents' and local democracy should be investigated and developed, and there should be greater possibilities for keeping residents informed and for them to get involved, for example, by making use of new technology.
We support with particular warmth the report's proposed insistence on getting women involved in urban development. Studies have shown that when women are involved in urban planning the results are very different from the plans of men only. Women consider the smooth flow of the working day more important than the monumental outward appearance of buildings. Women remember to see to it that children and prams, elderly people and the disabled can move around and live in comfort.

Berend
Mr President, ladies and gentlemen, I would first like to pay tribute to the rapporteur, Mr Novo Belenguer. I can support the main conclusions of the own-initiative report. However, in Germany we have found that successful spatial development policy needs a bottom-up approach. Regionally balanced social and economic development, in other words spatial cohesion, can only be achieved if local communities and regions are equally involved in spatial planning and decision-making from the outset. A top-down approach to spatial development is wasteful of people's energy, entails the risk of bad planning and our citizens are reluctant to accept it.
The rapporteur is, therefore, quite right in calling for the principle of subsidiarity to be strictly observed in implementing the ESDP. I believe that we should reject any attempt in the ESDP to tie EU Structural Funds to spatially relevant programmes. I am also afraid that they could be used as financing and regulatory instruments of regional planning policy. I do not think that we have any reservations about generally grouping regions into target areas or about the control and coordinating function which the Commission accordingly has to exercise. However, a European Spatial Development Perspective is not needed for this. Instead, the implementation of EU structural assistance should remain the responsibility of Member States, and should not be made more difficult because of additional regional planning criteria, so that it becomes a greater burden for Member States involving increased administrative expenditure.
We should reject any attempts to make structural and sectoral development policy in the Member States subordinate to key regions and central locations under a European Spatial Development Perspective. We must not lose sight of that in this debate.

Seppänen GUE/NGL)
Mr President, in the European Union, theory and practice differ in many matters. This is particularly true of urban environmental policy. Let us take Brussels, for example. Here, all our excrement gets directed untreated into the River Samme, which takes it untreated into the River Schelde, which takes it untreated into the North Sea. From there we get our excrement back in the form of mussels in those months which, in French, have the letter R in them. Brussels' first waste water treatment plant, which, therefore, is not a sewage plant, but a water treatment plant, will be completed next year. According to the reply I got from the Commission to a written question, Brussels is breaking the terms of Directive 91/271/EEC, and Article 17, in particular. It is going on under the Commission's very own nose. I propose that we embark on an urban policy by treating our own waste and making Brussels do the same. Brussels is an environmental disaster when it comes to urban policy.

Pinheiro
Mr President, ladies and gentlemen, I would like to start by thanking Mrs Napoletano, Mrs Pollack and Mr Novo Belenguer for their important reports, and all the other Members involved in preparing them. I would also like to take this opportunity of congratulating the House on its efforts to give urban issues a more central position on the Community's political agenda, in accordance with the communication presented by the Commission last year on the initiative of my fellow Commissioners, Mrs Wulf-Mathies, Mrs Bjerregaard, Mr Flynn and Mr Kinnock.
The Commission is engaged in a systematic examination of Community policies on urban planning. And, on the basis of that examination, we are preparing a plan of action for sustainable urban development, trying to achieve a strategic integrated approach to urban issues. I hope the Commission will shortly be adopting that plan of action, so that it can be discussed at the Vienna Urban Forum on 26 and 27 November this year. We are sure the European Parliament will also play an active part in that forum.
Many of the matters that have been dealt with in Parliamentary reports and Members' speeches will of necessity be taken up in the Commission's plan of action. We fully agree with the view that the creation of local capacity and development at local community level are essential aspects of urban regeneration and should be stimulated by the Structural Funds involved in this type of action.
The Commission shares this House's opinion that we must strengthen the environmental dimension of our policies for urban areas and that greater emphasis should be placed on more general questions related to the quality of life of urban populations. In the light of that opinion, then, what actions should the Commission's action plan entail? The challenges identified in the Commission's communication essentially relate to four matters: the need to improve productivity, economic development and employment in urban areas, especially in under-developed regions, the need to support equality of access and reduce social exclusion, which is increasing in urban areas, the need to make cities more sustainable from the environmental point of view, and the need to promote innovative and flexible decision-making processes in which our partners in the public, private and Community sectors can participate, at European and local level, and increase the synergy between institutional processes and existing resources.
The Commission has not yet finished preparing its plan of action, and so it is premature at this stage to put forward any concrete and specific proposals on the matter. Nevertheless, Mr President, ladies and gentlemen, we can in the meantime look at certain questions which are clearly matters of concern and will be included in the plan of action.
In the first place, increasing productivity in cities in under-developed regions, in order to reduce regional disparities, is a major challenge to the Community. Strategic urban planning must become more explicit where Structural Funds are concerned, and cities in eligible regions most play a more important part in future programming. We must also think in terms of actions going beyond priority regions. All cities must encourage on-going training and adaptability; they need to become training cities and incorporate technological advances for the benefit of the local economy and the local people. In that respect, the Commission needs to work out how to make the new Socrates and Leonardo programmes relevant in the urban context, and also the 'City of Tomorrow' scheme in the Fifth Framework Programme. Cities also need to develop local development methods and local employment, and the Community is working on this topic. Apart from these points, the Commission will also have to research the best way of accommodating the need for a balanced European urban system within the European transport and telematic systems.
Another aspect is the question of social equality and cohesion in urban areas. Among many other actions in that connection, the Commission intends to concentrate part of the next package of Structural Funds on deprived urban areas located in Objective 2 regions, as proposed in Agenda 2000. But we also need to encourage a similar concentration of resources in specific inner-city districts under Objective 1. Housing is an essential factor in the fight against inequality, social exclusion and crime in urban areas, and is also a sector with potential for job creation and the development of small and medium-sized businesses.
For these reasons, the Commission will be considering the possibilities of directing Structural Fund financing to specific housing programmes, where these are crucial to community development and part of an integrated urban regeneration effort. I am aware, and the Commission is aware, that Parliament is in favour of continuing the Community initiative, URBAN. In the light of the success of URBAN as a locally-based initiative, the Commission has decided to include it in the actions covered by Community support frameworks as from 2000. One aspect of its inclusion is that the definition of partnership in the draft Structural Funds regulation will be extended to include local authorities and social and economic organizations, which some Member States seem to find rather controversial. From the Commission's point of view, the inclusion of local authorities in partnership arrangements is essential if we are to find a solution to urban deprivation and achieve the successful integration of URBAN into our policy-making.
Another problem that arises, and will be addressed in the Commission's action plan, is that of the quality of the urban environment and urban life, which is also prominent in our reports and Members' speeches. Here we have to find more sustainable ways of managing our European cities so as to improve the quality of urban life, secure business competitiveness and protect the global environment. Environmental legislation is certainly the Community's most important means of improving the quality of the urban environment, particularly the measures we have taken on air quality, water quality, waste management and control of industrial pollution, all of which have had significant effects on urban areas.
The present legislation on assessing environmental effects also provides us with a valuable instrument for ensuring that new development in urban areas is sustainable from the environmental point of view. The Council directive on strategic environmental assessment will require the environmental effects of development to be taken into consideration from the beginning of the planning process, thus adding to the battery of instruments we already have at our disposal. We are seeing a considerable number of local projects in this field, as part of a process the Commission itself is encouraging. But we still need to renew our efforts to create environmentally sustainable cities by means of more structural measures, in which respect the Commission may consider a number of actions and studies. I refer to questions such as subsidizing mobility costs and encouraging toll systems, giving priority to reconversion development schemes, taxing energy to encourage more sustainable use and building up ways of reducing labour costs and increasing employment.
Finally, I come to the important question of local government and local power. The Commission can assure local and regional authorities that it will support their efforts to find more integrated solutions to complex urban problems. The Community must take action to develop the capacities of European cities and promote familiarity with urban problems at international level. It can do this by encouraging small-scale actions in the area of urban reference indicators and standards, as you have emphasized in your report, by organizing exchanges of experience, inaugurating research and integrating the knowledge gained through these various projects. We have already done this and will continue to do it, although, we hope, more efficiently.
In conclusion, Mr President, the Commission and the European Parliament are in agreement that the urban agenda is not merely a local agenda but, on the contrary, requires action at all administrative levels. For a number of reasons, including the fact that it will achieve the objectives of the Treaty, there are grounds for believing that Community involvement in this issue will bring obvious benefits. Certain urban challenges can only be effectively met if the Community plays its part, which admittedly is modest in some sectors, but a leading one in other areas, such as the environment and social and economic cohesion. In any event, we shall fully respect the principle of subsidiarity when deciding what actions should be taken.
Mr President, may I once again refer to the excellent and comprehensive report on planning and the European Spatial Development Perspective. Both the Commission and the planning authorities in Member States express and will express their appreciation and will feel encouraged by the enthusiasm and clear support shown in the report. In addition, the report provides a useful excuse for the Commission to state its point of view on recent developments following the Ministerial meeting on planning matters held in Glasgow on 8 June.
Mr Novo Belenguer's report rightly emphasizes that, because of the complexity of the matter and the need to achieve consensus between the 15 Member States, the process of working out a European Spatial Development Perspective is inherently a slow one. I nevertheless consider it highly encouraging that, despite the moderate progress in preparing the document on the 'European Spatial Development Perspective' , several Member States, indeed many Member States, have expressed their willingness to promote it, that is to say, to promote it within their own areas of responsibility. Thanks to those indications, we can hope for a joint incentive during the Austrian and German presidencies which will enable the first European Spatial Development Perspective to be approved next spring.
The Commission will continue to nurture a good working relationship with the Member States, supplying them with technical assistance where necessary and providing a wider transnational platform for the public debate that was inaugurated at the Ministerial meeting in Norwick last year. Its contribution to the process will include the following tasks:
helping Member States to finalize the 'European Spatial Development Perspective' document and providing secretarial services for the Committee on Spatial Development; -organizing the rest of the fourth transnational seminars on access to knowledge, urban-rural partnerships, the management of environmentally sensitive areas and the territorial impact of enlargement, and a major forum in Brussels next February to bring together the results of the public debate within Member States and at European level; -supporting an experimental two-year research programme to strengthen the European Spatial Development Perspective, with the object of introducing a network of European planning observatories; -preparing a preliminary report on Community policies and planning; -and, finally, supporting transnational cooperation in order to demonstrate the advantages of a 'European Spatial Development Perspective' approach, which at present we are doing through Interreg II-C, and from 2000 will do by means of a new Community initiative based on trans-European cooperation and designed to promote stable and harmonious development.In my judgment, the importance of these matters has quite rightly been underlined, but we should also emphasize our constant and genuine respect for the principle of subsidiarity, while fully shouldering our own responsibilities. In the immediate future, the Commission views it as its special responsibility to promote its own services, and to increase awareness of the implications of the various Community policies for planning, especially their contribution to achieving a more balanced geographical distribution of economic activities and the sustainable use of land, as well as meeting specific territorial needs.

President
The debate is closed.
The vote will take place tomorrow at 11.00 a.m.

Ad hoc procedures for 1999 budget
President
The next item is the report (A4-0256/98) by Mrs Dührkop Dührkop, on behalf of the Committee on Budgets, on the "ad hoc' procedures for the 1999 budget, as provided for in the Interinstitutional Agreements of 29 October 1993 on budgetary discipline and improvement of the budgetary procedure, and of 16 July 1997 on provisions regarding financing of the Common Foreign and Security Policy, and in the procedure concerning financing international fisheries agreements, pursuant to the Joint Declaration of 12 December 1996.

Dührkop Dührkop
Mr President, ladies and gentlemen, this debate opens the ad hoc procedure for the 1999 budget, as provided in the Interinstitutional Agreements of 29 October 1993, which stipulate that at the request of the European Parliament the ad hoc procedure may be opened if either of the two arms of the Budgetary Authority wishes to depart from the preliminary draft budget on agricultural spending submitted by the Commission.
With the trialogue held on 23 June, Parliament and the Council formally opened the ad hoc procedure for the budgetary year 1999. This procedure will remain open until an agreement is reached; in principle it will be closed in the autumn. It will, thus, provide a more realistic and appropriate budget estimate.
The budget procedure has been further improved and the ad hoc procedure now consists of three sections: agriculture, fisheries agreements and the common foreign and security policy.
Although it may appear to be a routine technical exercise, I should like to underline the political content of this ad hoc procedure, because it represents an extension of the European Parliament's influence over the budgetary procedure. In recent years its advantages in terms of budgetary rigour have been well and truly proved.
Before getting down to the contents of the motion for a resolution, I would like to mention the different views of the two institutions, the Council and Parliament, on the classification of certain items of agricultural expenditure, on which progress has been slow. For that reason, the European Parliament's point of view, as we commence our dialogue on the 1999 budget, is contained in Annex I of the resolution.
With regard to the forecasts for agricultural expenditure in the 1999 preliminary draft budget, the Commission suggests a figure of ECU 40 440 million. However, we must take into account, firstly, the fact that numerous items of agricultural expenditure have constantly been overestimated by over 10 % since 1994; secondly, that in 1997 the preliminary budget figure was ECU 42 305 million, but in the last review for that year there was a surplus of ECU 2 709 million; and thirdly, that the latest forecast, adjusted on 1 June 1998, predicts a surplus of approximately ECU 1 200 million, to which we have to add an initial reduction of ECU 1 000 million with regard to the Commission's original estimates. We thus arrive at a total of ECU 2 200 million less than the Commission's original estimates in terms of actual expenditure.
For all these reasons, I myself, as rapporteur, and the Committee on Budgets consider that the European Parliament should insist on a category 1 reserve, precisely because of our experience in previous years and the obvious difficulty of obtaining a more accurate forecast.
The creation of a reserve does not mean that we have to cut down on essential agricultural expenditure, because our intention is that Member States should only pay out what corresponds to real expenditure, and not have to provide the Commission with resources which will not be used and will have to be repaid to them later on.
In my original draft report, I suggested three separate reserves, one relating to support measures, in the absence of a truly effective evaluation report from the Commission, and a second on lines for which there is no legal basis. This is because I believe that if the Council insists that all non-compulsory expenditure must have a legal basis, the same should apply to compulsory expenditure, which the Council appears to have overlooked. There are, in fact, thirteen lines which lack a legal basis; these represent a total sum of ECU 150 million.
I should like to thank my colleagues in the Committee on Agriculture, with whom we have reached an agreement to provide for a total reserve of ECU 700 million for market uncertainties and support measures, provisionally on a linear basis, until the Commission's Letter of Amendment notifies us of the adjustments to be made according to the requirements and development of the sector.
I am appealing to the Council to reach an agreement with the European Parliament on a strict budget. Let us hope that it sets an example. However, it is worth mentioning that the pressure we have exerted through the ad hoc procedure in recent years has had notable results.
With regard to the question of international fisheries agreements, we should be very pleased at the confirmation of the principle that no payment should be made unless Parliament is first consulted. However, the reserve provided for in the preliminary draft budget appears to be overestimated, because there are too many uncertainties over the conclusion of certain agreements. Thanks to the collaboration of the Committee on Fisheries and the Commission, we are asking for the reserve to be reduced as indicated in Annex II.
With regard to our common foreign and security policy, this resolution also summarizes the position of the Committee on Foreign Affairs, particularly with respect to the reduction of the reserve allocated to emergency measures in support of other policies, such as democratic transition and electoral processes, and the prevention of conflicts, as well as the issue of the nomenclature proposed in Annex II of the resolution.
For all these reasons the Committee on Budgets and I, the rapporteur, call on the House to approve this report as a mandate for negotiations between the European Parliament delegation and the Council.

Sonneveld
Mr President, at this part-session, Parliament will be deciding on the mandate for negotiations with the Council covering, in particular, compulsory agricultural expenditure for 1999 as part of what is known as the ad hoc procedure. In previous years, we have gained a good deal of positive experience of this procedure, particularly last year with the 1998 budget. All of the parties involved believe that the ad hoc or Tillich/Mulder procedure must continue. This means that negotiations between Parliament and the Council should no longer focus on the preparation of a draft budget but on the autumn when the Commission sends the two arms of the Budgetary Authority a Letter of Amendment containing details of the most recent estimates of compulsory expenditure.
At this moment in time, we need to decide what changes might conceivably be made to the preliminary draft budget both in terms of income and expenditure. In view of actual expenditure for the financial year 1998, Parliament feels that it might perhaps be possible to make savings in 1999. It is acting on this assumption by allocating ECU 700 million to a general reserve to cover market uncertainties and related measures.
There are also tentative proposals for a straight cut in the agricultural budget. Any reduction will be temporary assuming that the Commission comes up with proposals for a more selective reduction in a number of substantial budget lines. It is a temporary solution given Parliament's express opposition to a genuine straight cut in compulsory expenditure. This opposition stands. The procedure must, of course, also work well if on balance we do not achieve savings but merely increase expenditure.
I would also like to say a few words about related measures arising from the 1992 agricultural reforms. These measures are becoming more and more important and expenditure is increasing significantly. What we are lacking is a proper analysis and evaluation of these measures. Parliament believes that an evaluation of this kind must be carried out very quickly, particularly as these measures will form a substantial part of the new rural policy proposed by the Commission. Parliament and the Council must be able to make a sensible decision on this. It is high time that Parliament carried out a thorough examination of the effectiveness of these related measures.
Parliament will propose increasing the budget item to combat fraud in the agricultural sector. This is in line with the Commission's intention to embark on new programmes of action. There must be no slackening in our efforts in this area. The Commission can embark on new campaigns immediately if funding is guaranteed.
Finally, the Dührkop Dührkop report contains proposals that involve dividing up the agriculture section of the budget in a different way. Separating traditional market planning expenditure from direct payments to producers, which have increased significantly, would, in particular, be very useful. The same goes for structural expenses in the Guarantee section. This item also demands specific attention given the Agenda 2000 initiative that has already been announced. Each of these cases involves compulsory agricultural expenditure although this is not to say that they would be able to escape the political will of Parliament. The way in which Parliament could exercise its authority in a proper manner must form part of an agreement between the various institutions, a new agreement. The new classification proposed by the rapporteur would be a good start.

Brinkhorst
Mr President, Mrs Dührkop's report demonstrates that in the Parliament progress can be made without changing the Treaty. For many years, the Council has refused to subject the budget to proper democratic control. We have been fighting for years for proper overall budgetary control, both for compulsory and non-compulsory expenditure. We have been also been fighting for years for democratic control over fisheries and for the budget on common foreign and security policy to be under democratic control. This proves that without Treaty change, provided Parliament is consistent, efficient and does not spend too much money, we can make progress. This is what we now have: the ad hoc procedure.
It has taken the Commission some time to understand that over-estimating budgetary expenditure in the field of agriculture is counter-productive. Finally, two years ago we made a start and I congratulate my colleague Mr Tillich who last year succeeded in gaining a firm commitment both from the Commission and the Council to accept the principle of the reserve. Much has been said about the reserve. It has always been said to be an abuse of power by the Parliament. But the reserve is not an abuse by the Parliament: it is the proper use of public money by a publicly controlled legislature. It is against that background that I believe we have the best starting point for the debate which will begin in the next few weeks.
One comment on the legal basis. This afternoon, it was again demonstrated in the debate with Commissioner Liikanen that the legal basis is not ultimately about the law, it is about the political willingness to understand the needs of the population. The fact that 90 budget lines are at present not being executed is shameful for the development of civil society. We have just passed the Herman report which makes it very clear that we can make progress providing the Council is willing to work with us. Let there be no misunderstanding: if we do not achieve in a trialogue a political breakthrough on the legal base, relations between the Parliament and the Council, but I would also add relations between the Parliament, Council and the Commission, will suffer: I hope this message will be received by all those who were not present here today. I see that the Commissioner for Africa is here and I hope that he can pass the message along to the Agricultural Commissioner. I believe that with what has been achieved so far we have a good starting-point and I am confident that we will come to a good conclusion.

Giansily
Mr President, ladies and gentlemen, the ad hoc procedure born of the provisions of the Interinstitutional Agreement of 29 October 1993 on agricultural expenditure has been extended to include fisheries agreements and the common foreign and security policy. Undoubtedly, this has enabled progress to be made, both as regards improvement of the budgetary procedure and preparation of the European Union's budget. The concertation which preceded the second reading of the 1998 budget is the best example of this.
On the one hand, the European Parliament is allowed to look over the section of agricultural expenditure, whilst on the other hand, by accepting certain positions of Parliament as regards compulsory expenditure, the Council can obtain certain concessions as regards non-compulsory expenditure. In the past, because of the supposedly unreasonable scope of the European Parliament's budgetary decisions, this has often represented a bone of contention, if not a source of conflict, between the two arms of the Budgetary Authority. Another significant and positive step forward is the agreement concluded between the Council and the Commission, as a result of which the Commission must now submit a Letter of Amendment for agricultural expenditure to its preliminary draft budget, before the first reading of the budget, so that the budget forecasts can be better assessed, this being a difficult exercise as regards agriculture.
These improvements are wholly acceptable for two reasons: firstly, it becomes possible to put an end to a kind of war over budgetary decisions between Parliament and the Council, which has gone on for far too long in the past; and secondly, they give Parliament a more coherent and unified role in exercising its authority. The situation of the budgetary hemiplegia of our Parliament, which only gave us power over half of the budget, leaving the Council the second part of the budgetary authority, is now seen as out of date and unrealistic. We are in favour of the ad hoc procedure as a code of good conduct between the two arms of the Budgetary Authority: budgetary etiquette ensures better results when drawing up the budget. But we must be careful that this does not engender, by insidious means, a confusion of powers, because as far as Parliament can see, it amounts to no less than a proposal to amend the structure and classification of agricultural expenditure, in other words, the abolition of compulsory and non-compulsory expenditure.
Without questioning the rationale behind the ad hoc procedure, nonetheless, we cannot support the rapporteur, for the basic reason that since agricultural expenditure is so specific, it could not, in the main, be treated as general, non-compulsory expenditure. By its very nature, non-compulsory expenditure is subject to the free will of the legislator, depending on the choices made. It is desirable, for example, to reduce a budgetary allocation in favour of a programme of wind power, depending on the interest and credibility attributed to this energy source. Most other agricultural expenditure has to be treated very differently, including expenditure concerning market support and that relating to direct aid or structural measures. This expenditure has to be guaranteed and, because it is so specific, it must be excluded from excessive attempts at classification. The ad hoc procedure must only be applied within the framework of the Interinstitutional Agreement and must not go beyond this. Whilst not wishing to swim against the tide, it is a step which my group and myself could not take.

Miranda
Mr President, I would make a general comment first of all to say that we consider the ad hoc procedure positive inasmuch as it provides a way for Parliament to contribute to the introduction of improvements in the distribution of compulsory expenditure, particularly agricultural expenditure. It guarantees that they are more rigorous and more transparent.
But we also consider - and this is a point we would like to emphasize - that this procedure neither can nor should be devalued by making it into a mere mechanism for proposing reductions in expenditure. This applies twice as much to the special reserve proposed in category 1. We can certainly agree to the creation of this reserve, particularly for the purpose of providing a cushion against market uncertainties. But we do not think it should be created as a matter of course; it should be consolidated and limited to very well-defined situations.
In this context, however, there is one idea which has already been raised in a previous report, and which we find controversial, namely, the idea of a dedicated fund. We understand the intention to lighten the budgetary burden on Member States, but we must draw attention to the dangers of such a trend, either as a precedent which may tend to become generalized, or, more especially, as a way of completely negating the concept of own resources.
Unless some precautions are taken, we run the risk that this concept of own resources will be transformed into mere routine transfers by Member States. And that is a situation with which I am sure none of us would agree.

Müller
Mr President, ladies and gentlemen, before I comment on Mrs Dührkop-Dührkop's excellent report, I must make a short additional remark on this afternoon's debate on legal bases, as this seems relevant to me and was not mentioned. The crucial point is not whether a judgement has to be complied with. That goes without saying. The crucial point is how we can get the Council to agree to policies that Parliament wishes to initiate. Unfortunately, we have not received any institutional reply to this question so far. As long as the Council refuses to make any concessions on this point, we will have to use the means available to us as the Budgetary Authority and bring pressure to bear.
At the last meeting of the Committee on Budgets, all the groups were in agreement that if the Council dug its heels in, we should make full use of the margins available to us in categories 3 and 4 of the 1999 budget. The Council has to realize that we know perfectly well how to get round its blocking tactics. After all, we are talking about at least ECU 1.3 billion. The Council can be quite sure that we are in a position to spend this money well. It will have to come clean on this in the trialogue.
Now let me turn to the Dührkop report, which - if we leave the specific estimates to one side for the time being - refers to three important institutional disputes that need to be resolved in the context of the next Interinstitutional Agreement. In addition to the problem of the legal basis, which I have already mentioned, it also refers to the classification of expenditure and also sounds a warning note about using the creation of a reserve to achieve increased flexibility. To this extent the Dührkop report is an important stage on the difficult road to interinstitutional cooperation. My group supports the efforts of the rapporteur and of the Committee on Agriculture and Rural Development to pay more attention to evaluating programmes. This also applies, of course, to sustainable regional agriculture programmes.
However, we wish to stress that everything possible must be done to guarantee that these particular programmes, which call for a high level of commitment by Member States, are made relevant to our citizens. With regard to creating an insurance fund to compensate for damage suffered as a result of animal diseases, I would like to emphasize that for me the key motive is to reduce the burden on the budget. Checks could accordingly be carried out so as to guarantee the self-insurance principle. I cannot, therefore, agree to the creation of a budget line at present.
Finally, I have another point about expenditure under the common foreign and security policy. We entered into the ad hoc procedures under the Amsterdam Treaty because it seemed important to us to preserve the non-compulsory nature of this expenditure. Nevertheless, these procedures assume a minimum of responsibility on both sides, which I believe the Council has not fulfilled. It is particularly regrettable that neither the Council nor the Commission has so far complied with Parliament's wish to establish a European Civil Peace Corps.

Fabre-Aubrespy
Mr President, ladies and gentlemen, once again we are studying an important report on budgetary procedure here in Brussels, which is different from the texts which our headquarters manages, confirmed by the Court of Justice.
The report submitted to us is far from being neutral. In fact, whilst, in theory, the ad hoc concertation procedure consists of formalized discussions between the two arms of the Budgetary Authority as regards the amount and distribution of compulsory and non-compulsory expenditure, in practice, this procedure allows the European Parliament to open a dialogue and to politically blackmail the Council, both as regards the amount of compulsory expenditure as well as the nature of some of this expenditure. I would like to discuss the two categories which are subject to the opening of an ad hoc procedure in the report, namely, agricultural expenditure and CFSP expenditure.
As regards agricultural expenditure, the European Parliament justifies its regular recourse to the ad hoc procedure by pointing out the endemic overestimating of the past 10 years. The Committee on Budgets believes that some lines in the agricultural budget are permanently provided with excessive appropriations. It calls on the Commission to submit a Letter of Amendment so that the budget includes only credits which match real needs as closely as possible. However, we should not be fooled by the real motives of the Committee on Budgets; their real and only objective is to influence the character, content and amount of compulsory expenditure, which is usually controlled unilaterally by the Council. I had tabled an amendment which proposed that Parliament should regard the ad hoc procedure as an instrument designed to improve the allocation of credits and not a political method for upsetting the current balance of power between the two arms of the Budgetary Authority. This amendment was rejected.
As regards CFSP expenditure, the problem is slightly different. To start with, the Maastricht Treaty treated this type of expenditure differently. The Interinstitutional Agreement of 16 July changed things, without respecting the procedure, or waiting for ratification of the Amsterdam Treaty. There is also a desire, in this respect, to change the texts and influence the Council's proposals. Contrary to what we are told, the ad hoc procedure is not a way of rationalizing expenditure, but a desire to redefine the classification of this expenditure.

Fabra Vallés
Mr President, the budget for 1999 is the last of the present financial perspectives. It is, therefore, a budget which, although it follows the same lines as those of previous years, has already begun to look towards what will be the new financial perspectives, and this is no less true as regards its agricultural aspect. We are well aware that the purpose of the ad hoc procedure is not to cast doubt on the competence of the budgetary authorities but is, on the contrary, to provide an opportunity for debate between the Council and Parliament on the classification of expenditure.
The Committee on Budgets approved Mrs Dührkop's report on the ad hoc procedure at the same time as it was confirming the value of the Tillich/Mulder procedure we introduced last year. We will apply it once again to the Commission's Letter of Amendment, which will be submitted at the end of October, in order to achieve greater harmony between predicted and actual expenditure.
I would also like to emphasize the fact that we have voted for the creation of a special reserve for market uncertainties and accompanying measures, while waiting for a Letter of Amendment from the Commission. It is allocated ECU 700 million from a linear cut in all B1 lines of the EAGGF - Guarantee Section, without an increase in its total amount, thus preventing an overestimation of agricultural expenditure. Whether the Council is prepared to accept it is another matter.
An additional innovation that has our support is the new expenditure nomenclature proposed by Mrs Dührkop, based on the purpose of the expenditure, in order to achieve a better evaluation of the common agricultural policy.
In addition - in the absence of any agreement with the Council on the legal basis in the trialogue, and to be coherent with the ruling by the Court of Justice -, the rapporteur suggests that funds relating to lines for which the legal basis has yet to be approved should be placed in a special reserve. In this way, the appropriations will be transferred from the reserve to the line only when the legal basis for it has been adopted.
The Tillich/Mulder procedure, which has already been mentioned, includes international fisheries agreements; therefore, the Commission's Letter of Amendment enables us to reach a better assessment of the situation as regards current negotiations, and if the agreements are not concluded in time, we can decide to reduce the amounts held in the reserve still further.
I do not want to finish, Mr President, without mentioning that there are some Members who have some reservations about dedicated reserves, because of the danger of accumulating expenditure at the end of the year and having to pay it all at the same time.
As far as the financing of the CFSP is concerned, we can accept a reduction in the allocations for emergency measures if this means that loans provided for the prevention of conflicts will be increased.

Virrankoski
Mr President, Mrs Dührkop has prepared a thorough report, for which I thank her profusely. I should like to look more closely at points 13 and 14. These tackle the questions of environmental support for agriculture, early retirement and afforestation.
Firstly, I would like to point out that European Union policy and funding should not extend to forestry as such. Only afforestation, which concerns reverting arable land to forest or rough pasture, might possibly fall within the European Union's sphere of activity, as might activity that sets out to prevent erosion or desertification. Point 14, in particular, focuses on the agricultural policy to be applied. It sees requirements for agriculture as being too vague and non-binding. At the same time, it calls on the Commission to make special proposals to enhance sustainable agriculture by developing regulations for good agricultural practice as well as functional standards for the environment and production.
I believe point 14 places too much faith in administration and bureaucracy, indeed in rules that extend to regional policy. We must remember that the European Union is a community of 370 million inhabitants. It is impossible to imagine that the Commission would be capable of drafting good agricultural policy for every nook and cranny of Europe. The same goes for meticulous standards also. For example, this spring, the Commission changed the final day for sowing for my particular country several times. Why should the Commission be trying to decide details such as this? Agriculture has ben practised for centuries in that Member State. They know perfectly well when the land can be sown there and when it cannot.
The basic prerequisite of the common agricultural policy is a respect for the principle of subsidiarity. The responsibility for agriculture lies with the Member States as well as the EU. Up until now the environmental protection of agriculture and associated activities has been dealt with through agreements between the Member State and the European Union, and both sides have contributed to the costs. Putting these into practice and monitoring the result are mainly the responsibility of the Member State. This has worked well, as the Member State has had both the functional and economic responsibility. I hope that these matters of subsidiarity will be resolved positively in conjunction with the CAP reform when the AGENDA 2000 programme is being decided.

Mulder
Mr President, I would like to turn to an aspect of Mrs Dührkop Dührkop's interesting report on combating animal diseases. This has cost the European budget a great deal of money over the past few years, on account of BSE, and swine fever, in particular. Presently, in the event of an outbreak of a contagious disease, 50 % of the costs are borne by the Member State and the remaining 50 % by the European budget. The present situation is that in certain Member States - for example, in the Netherlands, to name a country which is close to my heart - the 50 % of the costs which are borne nationally are borne by the farmers of that country. It is clear that this is not yet the case in other countries. Does the Commission not think that this could be a case of distortion of competition? Would it be possible for the Commission to evaluate all existing schemes relating to combating animal diseases in the Member States of the European Union in the near future? I already referred to this last May.
I believe that it is certainly worthwhile to consider Mrs Dührkop Dührkop's proposal to investigate the feasibility of establishing an insurance fund at European level for this. There are, however, many details to be discussed before then.

Pinheiro
Mr President, The Commission is pleased that the European Parliament seems to accept the overall amount proposed for EAGGF Guarantee and that there is a large measure of agreement on how it should be allocated between sectors. The rigour of this budget is evident not only in its 'zero-growth' , but also in the efforts which have been made to reduce the over-budgeting seen in the past on certain budget lines.
As for the proposed creation of a reserve inside the EAGGF Guarantee, I have to say that the Commission does not see how the creation of a reserve without making any change to the overall amount of the budget contributes to our common aim, namely a rigorous budget. The Commission is opposed to a linear reduction of all lines in order to fill a reserve.
However, if this is what the budgetary authority wishes to do, the Commission can accept to treat about 250 million euros as 'provisional appropriations' and place them in the reserve chapter B0-40. These appropriations can be drawn from five budget lines, which either tended to be consistently under-executed during the period 1994 to 1997, or where expenditure is not certain, such as the fight against outbreaks of animal diseases. To reduce the appropriations for the actions of control and prevention by 3 million and to inscribe them into the chapter B0-40, seems illogical. The Commission would not be able to carry out an evaluation of the accompanying measures, as Parliament has requested, and to which it is committed, if Parliament withdraws the appropriations.
Concerning the transfer of a supplementary 17 million euros to the B0-40, obtained by a linear reduction of the budget lines, the Commission does not see the usefulness of this action. In its preliminary draft budget the Commission is committed to presenting new actions to control and prevent fraud, if possible in the framework of the Letter of Amendment.
In the future, the agricultural Letter of Amendment in the autumn will be a crucial step in the EAGGF-Guarantee budgetary procedure As in the past, it will allow the latest developments in production and on markets to be taken into account. In this regard, developments up to now do not lead us at this stage to expect savings on the amount proposed in the 1999 PDB. The rectifying letter will also be the right occasion for an update of the PDB in the light of legislative decisions, including those on the price package, market reforms and, probably, the adaptation of the agri-monetary system following the introduction of the euro.
Concerning fisheries agreements, following the new estimations, the Commission can now endorse two changes to the preliminary draft budget if the budget authority can agree on them. The first one is the transfer of 0, 5 million euro from the line B7-8000 to the reserve relating to the agreement with the Gambia which will most probably not be signed in 1998 and thus will not be in force at the beginning of 1999. The second is a reduction of up to 7 million euro of the reserve intended for new agreements, due to the fact that it will most likely not be possible to conclude a new agreement with Russia in the near future, for which such an amount had been foreseen in the reserve. However, at a later stage the Commission present updated estimates and propose the corresponding changes to the proposals for new agreements. As agreed during the trialogue of March 1998, the final distribution between the reserve and the budget line should be decided in the Letter of Amendment that the Commission will transmit at the end of October to the budget authority.
Finally, concerning the financing of the common foreign and security policy, with regard to the line for urgent actions (B8-015), appropriations proposed in the Preliminary Draft Budget for 1999 have been increased in the light of the relatively swift execution in the first months of 1998. However, the Commission could endorse a certain downward revision of the allocated amount, such as the 2 million euro proposed by the European Parliament and reinforce for example the line for prevention of conflicts and support for peace processes (B8-013).
Minor modifications in the nomenclature do not pose any problem for the Commission. But if no agreement can be found for some budget lines, the Commission proposes to revert either to the nomenclature agreed upon in the 1998 budget discussion, or to the nomenclature agreed upon in the Interinstitutional Agreement.

Dührkop Dührkop
Commissioner, I would like to make it absolutely clear that this resolution does not propose any reserve for support measures. I have said quite clearly that I would have liked to ask for much more specific reserves instead of a general reserve. But the general fund that has finally been decided on has been agreed with the Committee on Agriculture. And if you read the report carefully, you will see that it says "provisionally linear' . During all the years of the ad hoc procedure this House has always stated that it is clearly against linear cuts. For the time being, until we see from the Letter of Amendment where the real needs lie, we prefer to say "provisionally linear' .
As far as fishing agreements are concerned, Commissioner, I would like to say that, as we both know, not only is there little chance of the agreement with Russia being included in the 1999 budget, but this applies to one or two other agreements as well. We shall see how things stand around autumn, as we shall with agricultural expenditure, when we look at the amendments to the budget.

Pinheiro
Thank you, Mrs Dührkop, for your explanations and clarifications, which I do of course note. With regard to fisheries agreements, however, and inasmuch as I am involved from time to time, at least collaterally, in negotiating some of these agreements, it is extremely difficult to make a reliable prediction. I will give you an example: the fisheries agreement with South Africa. This is an agreement which looked impossible last year, on which negotiations began this year, and which, in spite of everything, we have some hope of being able to conclude by the end of the year.
We have some hope, but no more than that! Because it depends much more on the South African authorities than the Community authorities. For that reason, we have to view these matters with some degree of caution, accepting that there is some uncertainty. This was the point I wanted to clarify, while assuring you that I do, therefore, understand the difficulty both my colleague and the Member and her colleagues find themselves in, because they would like a strict budget, while at the same time they are confronted with these uncertainties with which they have to grapple.

President
Thank you, Mr Pinheiro.
The debate is closed.
The vote will take place tomorrow at 11.00 a.m.

Vendor control systems
President
The next item is the report (A4-0230/98) by Mr Riccardo Garosci, on behalf of the Committee on Economic and Monetary Affairs and Industrial Policy, on the Commission report on the vendor control systems applied by the Member States (COM(96)0245 - C4-0589/96).

Garosci
Mr President, this is my first speech in my new seat in this Parliament, finally in the centre.
Starting with the bad news, 30 June 1999 could perhaps be the last day on which people who travel between Member States will be able to purchase duty-free goods such as specialty items, crafts, luxury articles, alcohol, and tobacco in tax free shops. This date will change an important feature that has been with European travellers for 50 years. Its abolition is, however, the direct consequence of the creation of the single market on 1 January 1993. Given the sector's socio-economic importance, the Council granted a special extension from 1 January 1993 until 30 June 1999 so that the sectors could gradually phase out the tax-free system. The Council also authorized duty-free sales during the extension period in the two Channel tunnel terminals and increased the duty-free allowance for third countries to ECU 175 and for Community countries to ECU 90. Given the lack of border controls, the Council has set minimum standards of control on tax-free sales dealt with in this report.
The Commission should have presented the Council with a report by 1994 on the functioning of this transitional system and on the related systems of vendor controls. This report was not produced until 1996, and today, a little more than one year before the end of the extension, the Parliament is called on to give its opinion on this Commission report and, therefore, indirectly on the future of duty-free.
The first airport with tax-free points of sale was Shannon in Ireland in 1947. To give you an idea of how this tax-free airport has developed, from the first flight with thirty passengers in 1945, we have reached a turnover of $10 million in 1977. The Shannon concept spread rapidly to all of Europe and since then all the major airports have adopted the duty-free system. Following the example of the airlines, the ferries also developed tax-free sales on board, especially the small companies with year-round service, and today these sales still cover a large part of their management costs. In the European Union, the sector now carries weight in the three fundamental channels - airports, ferries and on board aeroplanes - with a sales turnover of $7 billion in 1996.
In 1991, the Commission said that it was in favour of producing a study on the socio-economic consequences of eliminating duty-free. Unfortunately, this report was never produced, and the information available today for understanding the current importance of the sector in question is still the information compiled by the sectors and the information contained in a European Parliament study. The creation of the internal market on 1 January 1993 and the relative absence of Community borders made it necessary to introduce a system to monitor sales and guarantee compliance with the set duty-free allowances. The manager of duty-free sales - and here we arrive at the central issue of the report - has to pursue two separate objectives: increasing sales whilst making sure that sales do not exceed the set limits.
The Commission states that compliance by managers of the guidelines laid down by the Council in 1992 has been far from satisfactory. In most cases, shop managers have not applied systems that keep track of purchases and have not set up systems that calculate how much duty-free allowance passengers still have. There has also been no coordination of controls for purchases made on aeroplanes. The duty-free sales manager does not have all the relevant travel information for the passenger concerned at the time of the individual purchase. This is due to the shortcomings of the control systems, but is also justifiable because the provision of effective controls coordinated between the various modes of transport and for the various stages of each journey would require huge investment.
For their part, the controls set up by tax free shop managers are only the same as those carried out by warehouse managers and only guarantee that the goods have not left the store or the tax-free area without having been registered. The shortcomings observed are probably due to the fact that Member States have not, between themselves, had the time to organize, coordinate and invest in these systems.
The extension to 30 June 1999 could have been a way of helping the sector make the necessary, gradual adaptations, but since 1991 nothing has been done to convert the duty-free system in preparation for the end of duty-free on 30 June 1999. There is also another problem of fairness with traditional shops. Even if sales were to decrease, the development of air traffic would offset any initial drop. Furthermore, the abolition of duty-free does not mean the physical closure of the points of sale but only the end to duty-free allowances for travel within the Community. Another important factor is the physical location of duty-free shops and shops in the city, which is difficult to compare.
So, whether we like it or not, the completion of a real internal market must include the end to duty-free sales within the Community. The case of duty-free, however, raises socio-economic problems that Parliament cannot ignore. The sector directly employs about 140 000 people, and the abolition of duty-free allowances will mean that a lot of these jobs will be in jeopardy; in addition to the risk of job losses, there will be negative effects on the tourist industry, particularly in certain peripheral regions.
Furthermore, the elimination of duty-free sales will jeopardize the process of liberalization of the transport industry, especially for small and medium-sized operators. The consequent rush by the airlines to save money could also endanger transport safety.
For that reason we are placing a lot of trust in the amendment that the Commission is sponsoring to use regional funds. We understand that the decision to eliminate duty-free sales, unless there be some new unanimous political assessments, is final and we agree with the Commission's assessment that the situation is rather unsatisfactory. The idea of using the duty-free system also for the arrival of the euro is important. Therefore, without changing the deadline of 30 June 1999, it is our duty to provide the managers with instruments and methods for improving their control and for providing the network of duty-free shops with an opportunity to make a gradual conversion into normal points of sale.
We therefore consider that the second of the two amendments which I have tabled is fundamental. This amendment enables travellers whose final destination is outside the Community, but who have a stopover, to make duty-free purchases at the point of departure.

Metten
Mr President, those of us who fly regularly know that the control on compliance with the regulations in respect of duty-free sales is absent, or at least it is full of loopholes. Individuals who have bought their quantity of duty-free alcohol or cigarettes in the airport have no difficulty in obtaining another lot on board the aeroplane. Those purchasing goods above the permitted duty-fee sum find that they have not paid VAT after all, as the shopkeeper will have paid it.
These problems are as old as duty-free sales themselves. The fact that they have not yet been resolved says a great deal. The duty-free sales within the European Community may disappear in a year's time from today, but they will remain in place for journeys out of the Union. As a result, the problem of uncontrolled double duty-free sales remains with us and this is the subject of this report.
The Group of the Party of European Socialists agrees with the rapporteur that it is time effective controls were in place, and we agree with his recommendations, which are astoundingly easy to implement. My group thinks it is right that the Garosci report only deals with the control of duty-free sales. Indeed, the European Commission's report on the subject is rather out of date. We did not agree with the way in which the original report tried to table the Ecofin Council resolution dated December 1991, on the subject of ending duty-free sales within the Community, again. We are, of course, also concerned about jobs in duty-free shops, but firstly, consumer purchases will be moved to other shops where jobs will be created and secondly, governments will be able to lower taxes by raising additional, different tax revenues, or increase their expenditure in order to create new jobs. After all, attractive as duty-free sales may be to the consumer, they are anything but free. They are a subsidy on flying from which the better-off traveller in particular benefits, and to which all citizens contribute. It is, therefore, a socially regressive tax. It is a subsidy to the most polluting form of transport which discriminates against environmentally-friendly forms of transport which cannot make use of this privilege. It is a subsidy which discriminates against shops in towns and villages who must pay VAT and excise duties, in favour of shops at airports. It is a subsidy on alcohol and tobacco, in particular, as these more than any other products are affected by the freedom from tax. Yet these are not the kind of products we would choose to subsidize before all others, given a free choice.
Research I have conducted showed that consumers benefit from only one-third of the non-paid tax, while the shopkeeper retains two-thirds. This enormous percentage of profit on sales in duty-free shops explains the enormous campaigns and gigantic pressure put on us as Members of the European Parliament. But we will not succumb to this pressure, based on the arguments I have submitted. We will, therefore, support the Garosci report in its present form.

Lulling
Mr President, I cannot, of course, agree with the previous speaker, who like a typical socialist can only see the downside when it comes to tax-free sales. No, I am one of those people who is passionately committed to keeping duty-free shops at airports and on ships for people travelling inside the European Union, who should keep the right to buy typical products, artefacts and other goods free of tax. However, all this is due to end on 30 June 1999. I know that there are some people who adhere strictly to principles, and that it can be said that duty-free is incompatible with the internal market. This principle is a hobbyhorse of the Commission and, in particular, of Commissioner Monti. The Commissioner has refused to extend the 30 June deadline again, for example until 1 January 2002, as our rapporteur, Mr Garosci, had proposed in a spirit of compromise. That is, of course, when we will have euro coins and notes in our pockets.
I am not just an advocate of duty-free because I want to make it easy for executives with money to spend to buy luxury goods on business trips. But right now I simply cannot ignore the fact that there are 18 million unemployed in the European Union and that tens of thousands of jobs are being put at risk by abolishing duty-free at airports and on ships, not to mention the effect on the cost of flying. Is it not rather contradictory to organize grandiose employment summits, set up action plans to preserve and create jobs, and then simultaneously, by rigidly adhering to principles, jeopardize more jobs than programmes of this kind could ever preserve or create? I also know that politics is the art of the possible. So I can only express my regret that the good intentions of our rapporteur, Mr Garosci, whom I warmly thank and who wanted to save duty-free, have become the victim of a procedure which has swept all his excellent proposals aside by limiting his report strictly to vendor control systems.
I am the joint author of two amendments, the aim of which is to ensure that we do not at least just lock the stable door after the horse has bolted, in other words, after we have destroyed jobs by abolishing duty-free. Instead, we intend that a system of sectoral and regional aid should be provided for the regions and sectors that will be hardest hit by the abolition of duty-free. We want to ensure that Community funding is made available for this. I also hope that Parliament will agree to our amendment, which stipulates that travellers departing from ports and airports in the European Union will be able to make duty-free purchases if their final destination is outside the Union, but they have to change inside the Community. This is particularly important for Luxembourg, as we can usually only fly to third countries via Frankfurt, Brussels, Paris and Amsterdam, and I hope ...
(The President cut off the speaker)

Boogerd-Quaak
Mr President, Mr Garosci's report is, of course, an extremely interesting report. This is particularly true, as we do not say what we really wanted to say, as the Committee on Economic and Monetary Affairs and Industrial Policy has decided to stick with the European Commission report. But the question which arises is whether implementing the measures in the Garosci report will be effective, considering the fact that by the time bureaucracy has processed these recommendations, duty-frees will be abolished. That is what I think anyway.
Nevertheless, Parliament has made a wise decision in my view. Parliament has not been tempted into the trap of giving its opinion on a problem whose future direction is in the hands of the European Commission. The question remains concerning the stage at which the duty-free zones must be abolished.
In theory, we are agreed, of course, that these duty-free zones must be abolished, but on the other hand, the European Union and the Council in the vanguard, with the European Commission in the rear, have not been able to resolve a number of tax issues. Society might have expected that these tax issues would have been resolved by now.
Another issue relates, for example, to how this system of abolished duty-free allowances is to function in regions such as the European Economic Area. European citizens travelling from Amsterdam to Switzerland or from Paris to Norway may encounter, for example, different rules than when they travel direct to Sweden. I fear that we are facing a problem which we are not resolving correctly, as we anticipate events while still leaving issues unresolved. I would, therefore, urge the European Commission to reconsider carefully all aspects of this issue and, in particular, to review the inevitable effects, rather than just the recommendations in this report.

Gallagher
Mr President, I recognize that the primary thrust of the Garosci report relates to the general need to tighten up the rules governing the purchase of duty-free products at airports within the territories of the European Union. However, it is difficult at this time to debate such an issue without referring to the broader need to maintain duty-free operations within Europe post-1999.
I understand that the outgoing President of the Ecofin Council described this debate as the most emotive one on the political agenda and I believe most people would agree with that. The abolition of duty-free will be a highly regressive step in the light of the fact that it commands such widespread support among the citizens of Europe. It is a consumer-friendly measure and one which commands widespread public support. In fact, at a time when many people contend that they feel alienated with the workings of the European Union, they find it virtually incomprehensible that the EU is abolishing what is a very popular mode of social shopping for many people working and travelling to different Member States within the Union.
The European Commission is not giving an inch on the need to look closely again at the effects of the abolition of duty-free and the effect that this will have in many Member States of the Union, particularly peripheral regions. We should not forget that the Commission gave an assurance that this study will be carried out and they have failed to have fulfilled this commitment. The Commission is not endearing itself to the general public by taking such a wholly unsympathetic and forthright position.
On 3 April, this House overwhelmingly voted for a resolution calling on the European Commission to carry out a social and economic study. The fact that the European Commission is refusing to do this, once again reinforces the fact that it is unwilling to listen to the wishes of the only democratically elected body within the European Union. The Council of Ecofin Ministers met on 19 May and contrary to press speculation there was no decision or reaffirmation by the Council that duty-free would be abolished. The issue will be back on the Ecofin agenda when working documents on the issue are prepared. I welcome the fact that the Mr Garosci in his report believes and recognizes that an alternative solution must be found to the abolition of duty-free shopping. He makes the clear and correct observation that the decision would immediately jeopardize a sector which employs 140 000 people in Europe.
If duty-free operations discontinue, the effects for my country, Ireland, will be very serious. There would be job losses across all sectors; price rises in both air and sea travel; higher access costs for travel; threats to the viability of year-round ferry services to and from Ireland. It is a very serious situation and I would hope that the Commission will at last take into consideration the views of the Members of this House and the wishes of the vast majority of the people of this Union.

Blokland
Mr President, first of all I would like to express my appreciation for the fact that the Garosci report keeps to the subject it deals with: the point-of-sale control systems. The Committee on Economic and Monetary Affairs and Industrial Policy convened a hearing on this subject which unfortunately proved to be overcrowded by lobbyists who pleaded in favour of duty-free sales.
The European Commission report is clear. The controls are slack in many ways. The main cause is that people are riding roughshod over one of the basic principles of the administrative policing. The vendors, in whose interest it is to maximize their turnover, are at the same time required to ensure that their customers do not exceed their purchase limits. The inevitable result is that the improvements proposed by the rapporteur remain stopgaps, which is not to say that they should not be welcomed.
The duty-free sales on internal European journeys conflict with the single European market. The distortion of competition is all the greater, due to the defective controls. The price level is still considerable, despite the duty-free regime. The consumer hardly benefits, not least because jobs are sucked away artificially from the normal distribution chain stores and smaller shopkeepers. Duty-free sales frustrate the required internalization of the external effects of transport, due to cross subsidies. We should not forget the environment. To conclude, there are more than sufficient reasons to reject all amendments tabled.

García Arias
Mr President, I would like to congratulate the rapporteur and point out that, although formally this debate ought to have been limited to the Commission's report on the vendor control systems used by Member States, it is clear that it has been brought up at every Parliamentary committee meeting in which the economic and social repercussions of the abolition of duty-free shops within the boundaries of the European Union have been debated. Has this been the case, as some speakers have suggested, because the commercial sector affected has taken the opportunity to inform us of its arguments against the abolition of duty-free shops? Or is it because the Commission's report itself and the debate within the Council has led some of us, as Members of the European Parliament, to consider the possible disadvantages of their abolition in greater detail and with greater interest, and - why not? - with some anxiety? The fact is that there are valid arguments both for and against this measure.
I think the Committee on Transport's conclusions have shown us that it would be fitting for the Commission to prepare a more detailed study, particularly on the effects the abolition of this kind of shop might have on the funding and management of transport infrastructures, and the possible threat to consumers of an increase in terms of transport service costs as a result of increased airport charges.
Mr President, I am not in a position to express such a forthright opinion as some Members have done. I would like to see a more detailed study of the subject, which is being called for not by the sector but by the representatives of some Member States. I would also leave out some of the accusations we have heard concerning the sinful attitude of certain Members or Member States. I should like us to avoid debates of that sort. I, at least, have had neither the opportunity nor the intention of speaking to any representative of the lobby involved.
In any event, Mr President, what the Commission's report does say is that there are serious problems regarding controls in terms of the level of sales, especially for airport and in-flight sales. And I totally agree that we should support all measures to enforce the observance of the laws of the European Union and its Member States and prevent abuses in that sector.

Ilaskivi
Mr President, the question under debate here is how the control of the duty-free system works. The Committee on Economic and Monetary Affairs and Industrial Policy decided after voting that it cannot, nor, consequently, can Parliament itself, take a position on the main question under debate. It is the question of the possible continuation of dutyfree sales which interests the ordinary citizen.
I would like to make two marginal notes. Firstly, the decision to end dates from 1991. At that time, Finland and Sweden, for example, were not members of the European Union. However, duty-free sales were absolutely essential for their shipping traffic, and partly also for their air traffic. Finland, isolated as she is by the sea, has through them built at reasonable cost a bridge over to mainland Europe. Ending duty-free will sever this connection.
Secondly, ending duty-free will create unemployment. 40 000 people in the Union and 13 000 in Finland will lose their job. This is in direct conflict with the EU pledge to pay serious attention to averting unemployment. The one hand does not know what the other is doing. Besides, even if duty-free sales are abolished and there is apparent harmonization, the high and disharmonious levels of tax on alcohol and tobacco in the Nordic countries will continue.
Who will benefit? There might be a spurious element of prestige in it for the Commission and Ecofin. Another beneficiary will be Estonia, which is outside the EU. Ships plying between Helsinki and Stockholm may preserve the duty-free system by stopping off in the future in Tallinn. But how high will the port costs be that Tallinn will levy in that case? The matter has not been thought through from all sides thanks to a bullheaded Commission and a toothless Ecofin.

Donnay
Mr President, ladies and gentlemen, at a time when unemployment remains the main concern in all our countries, I am not at all sure that it is wise to further increase unemployment through changes which some are immediately planning for duty-free trade. This has been properly pointed out in the study prepared by Parliament's Directorate-General for Research.
With regard to the study, I would also like to point out that the Commission has not fulfilled its commitments or kept its word as given at the time of Mrs Scrivener. Between the commitment made at the time and today, a lot of time has passed but nothing has been done. We should also remember that the Commission did not think it worth replying to the request from the Transport Council of 17 March 1998 nor to the European Parliament's resolution of 3 April. Nor does its proposal, of the Ecofin Council of 19 May, correspond any better to its promise of 1991 or to Parliament's request, reiterated in its resolution of 3 April and adopted by a very large majority.
Once again, therefore, we have to point out that the scheduled end of duty-free trade within the Union cannot take place unless certain very specific conditions have already been met. Otherwise, we shall run the risk of very serious repercussions in terms of jobs in the regions affected. So, ladies and gentlemen, whereas paragraph 19 of the Commission's report on vendor controls recognized that duty-free sales make some contribution to the funding of airport infrastructures, help to minimize the effect of airport taxes and thus favour the tourist industry, it would be quite appropriate to provide for aid and appropriate compensation measures, especially in peripheral regions, which will suffer disproportionately from the consequences of the abolition of duty-free trade.
In this context, particular attention will also have to be paid to transport services in isolated and peripheral regions, and the Commission must look seriously into the possibility of Community funding. Therefore, Mr President, no-one will be surprised to learn that our group will vote against Mr Garosci's report in its current version, as it represents an accelerated death warrant for duty-free trade without there having been any study or serious actions and will inevitably have disastrous repercussions on employment and on the regions concerned.

Miller
Mr President, when I was a young boy living in Scotland, at nighttime I used to listen to a children's programme called 'Jackanory' ; it told you fairy tales. Well, tonight I think I have sat through another episode of it because I have never heard so much disinformation coming across on the question of duty-free.
I heard Mrs Boogerd-Quaak saying 'duty-free is going' . Duty-free is not going. Duty-free will still exist for all those travellers outwith the EU. Can I say why it is important that we discuss vendor control tonight? I will give you a prime example. If you travel via Brussels airport, as most Members here do, you go into the main lobby in terminal B and you can buy a bottle of spirits and 200 cigarettes. You then go down terminal B to get to your gate and there are another two duty-free shops there where you can buy another bottle of spirits and another 200 cigarettes at each one of these shops. Therefore, you have three litres of spirits and 600 cigarettes. While you are flying back to Glasgow they come around asking if you would like to buy duty-free. You can buy another bottle of spirits and another 200 cigarettes. Then you have 4 litres of spirits and 800 cigarettes. The only problem you would have in getting them back is not whether customs stop you, it is actually carrying the bloody stuff. If we are going to continue to operate properly as a Union, we have to tighten up on the vendor control system.
Let us drop this whole question of duty-free coming or going. That argument will be won or lost in the Ecofin Council; it will not be won and lost in this Chamber. It is high time people recognized that. Therefore, the Committee on Economic and Monetary Affairs and Industrial Policy have put down amendments to the Garosci Report showing ways that we can get around the abuse of the system within airports, ports and airlines. It is important that we take these up and implement them. If we do not we are allowing fraud to continue within our system and also there is loss of revenue to exchequers in the various Member States. Therefore, let us concentrate on the issue which is in front of us. It is not duty-free, it is vendor control. Please stick to the issue.

Cassidy
Mr President, it has been a stimulating debate so far and I particularly appreciated the contribution from Mr Miller who demonstrated very clearly the point made by the rapporteur, in his excellent report, that vendor control is simply not working.
Mr Miller described graphically what happens at Brussels airport. Let me tell you what happens on cross-channel ferries. Some rogues collect up boarding cards from innocent and naive passengers and take them along to the duty-free shop and cash them in for much larger amounts than they are actually permitted by the regulation. It is a system which is subject to wide-scale abuse. I agree with those people who have regretted that the whole debate has been hijacked into an entirely irrelevant consideration about duty-free.
I am a great supporter of lobbies, I believe profoundly in their ability to come here and try to influence us. I do not agree however that they should tell lies in doing so. One of the worst of the untruths that they have been telling is about job losses. There has been an unscrupulous playing on the fears of their employees for their job futures. Obviously people are going to continue to travel by air. Indeed, in the United Kingdom airports are expanding their shopping facilities all the time.
There is, of course, a problem on some ferries, particularly those crossing the Channel. Those problems are caused by the fact that there are too many ships chasing too few passengers, particularly now that the Channel Tunnel is open. The Channel Tunnel, where incidentally you cannot benefit from duty-free if you travel on the Eurostar.
So I support what Mr Garosci has done, I entirely agree with the points made by Mr Miller and indeed somewhat exceptionally too, with the points made by Mr Metten. So I hope we will support the rapporteur and reject most of the amendments.

Guinebertière
Mr President, the decision to abolish the duty-free sector on 30 June 1999 was confirmed by the refusal of the Ecofin Council on 18 May 1998 to comply with Commissioner Scrivener's promise made to the Members of the European Parliament to carry out a study on the impact throughout the Union.
Since I only have two minutes, I will simply deal with one single aspect of this problem. The directive which was passed in 1991 formed part of an overall plan for a harmonized tax system for Europe. Unfortunately, we are hardly, if anywhere, near that yet. Europe must not be created at the expense of jobs. And yet, during the hearing of 29 October 1997, Commissioner Monti recognized that the abolition of duty-free sales would affect employment and the economic activity of certain regions in Europe. Of all duty-free products sold, 41 % are of French origin and duty-free trade is the best possible shop window and the best possible way of promoting products made for export.
I come from the Cognac region in France and more than 30 % of its production is sold duty-free on the world market. It is the main sector in the Cognac region and accounts for a major share of top quality sales. A specific study has shown that 1 000 jobs are affected by this European decision and that 2 000 hectares of vineyards will be grubbed. And this comes on top of the Asian crisis. In some regions, such as the Nord-Pas-de-Calais, which already has 20 % unemployment, 3 500 jobs will be lost.
Europe will not be able to justify itself to the electorate with such inept and brutal decisions. Have we thought about a different approach, which would be more in harmony with the economic and social constraints which prevail at the end of the century? What about, for example, a progressive tax rate which would be more flexible and more pragmatic? Perhaps there is still time to step back. Who is going to pay the bill? Airports? The airline and shipping companies? The consumer? No doubt all of them will to some extent. But it will cost far more to rehabilitate the credibility of the European institutions and the prime movers within them who deliberately destroy jobs.

Paasio
Mr President, we must agree with the position of the Committee on Transport and Tourism and others that problems caused by the ending of duty-free sales should have been discussed in connection with this present topic for discussion. I will take the liberty of wondering out loud how difficult it will be to effect and conduct proper discussions on the subject. We tend to stick rigidly to legal interpretation without paying sufficient attention, for example, to the EU's massive aim to substantially reduce unemployment. The EU should not be making decisions that run counter to this aim. But that is what appears to be happening in this debate.
It is patently obvious that ending duty-free sales will weaken, for example, Finland's ability to maintain communications with the rest of the European Union. Finland is an island as seen from Central and Western Europe, and one that needs sufficiently efficient and competitive maritime links. Duty-free sales have done a great deal to guarantee high-quality Finnish maritime links to Scandinavia and the Baltic. Because of duty-free sales, fares have been kept so moderate that anyone, including the unemployed, can enjoy these crossings. This is the main thing that has kept passenger numbers high and traffic busy, thus enabling, furthermore, high freight capacity. Some have clearly laboured under misconceptions such as the idea that all this has to do with protecting the interests of the wealthy. But this is really not the case; on the contrary, it is emphatically about the interests of the less well-off, and therefore about equality between citizens.
Effective and regular car ferry services are a part of Finland's main route connections to Scandinavia, the Baltic and thus to elsewhere in Europe. Any deterioration in these will mean higher freight costs and bottlenecks regarding capacity, causing problems for economic development for the whole country. Discontinuing duty-free sales will mean higher fares and the threat that some services will cease altogether. This would have an immediate and deteriorating effect on maritime employment. The effects on employment will not, however, be confined to the maritime sector. Road traffic employment will similarly come under threat. The rise in costs and transportation difficulties will also mean an increase in costs to the export industry, affecting its competitiveness and, indirectly, employment. A fall in capacity will also result in fewer orders for the shipbuilding industry with a crushing effect on dockyard employees and subcontractors everywhere in the EU.
We sincerely hope that the Commission will take seriously the demands expressed in the European Parliament for a thorough clarification of the total effect of discontinuing duty-free sales.

Gillis
Mr President, in 1991 by a unanimous vote the Council of Ministers decided to abolish duty-free sales for journeys by air and sea within the European Union from 30 January 1999. The best estimates we have indicate that up to 140, 000 jobs may be lost as a result of the Council decision. Despite considerable pressure, the Council of Ministers has refused on a number of occasions to reconsider their decision to abolish duty-free. It is clear that many air companies and ferries, in particular those operating in peripheral regions such as Ireland, will have difficulty surviving the loss of income the abolition of duty-free will bring. In addition, the ticket cost to the travelling public will undoubtedly increase.
I will continue to strive to overturn that Council decision. However, it is necessary to consider the plight of those whose jobs will be put in jeopardy by the Council decision. The Commission must urgently examine the situation of people whose jobs will be put at risk by the abolition of duty-free sales and bring forward a proposal in good time to alleviate the adverse consequences for those involved. A number of ferry companies face severe loss and even bankruptcy as a result of the Council of Ministers' decision. The Commission must examine in particular the structure of air and ferry companies servicing peripheral regions and bring forward measures to prevent loss of services to those regions concerned and prevent job losses.

Lukas
Mr President, when the Council decided in 1991 to extend the existence of duty-free shopping until 1999, it could certainly not have known that unemployment in the EU in 1998 would be 18 million and rising. The Council also had no idea that in 1999, despite monetary union becoming a reality, there would still be no question of tax harmonization. So the internal market has not really been completed. The Council and Commission's inflexibility on this point borders on irresponsibility! Abolishing duty-free means killing several birds with one stone, in a negative sense, of course. A large number of additional unemployed people will come onto the job market. The EU will voluntarily sacrifice an important shop window for its branded export goods, and the tourist trade will suffer demonstrable damage.
A cynic might say that the first concrete employment policy measure taken by the Community will be the destruction of over 100 000 jobs by abolishing duty-free. I find it absolutely incomprehensible that the Council has not reviewed its position given the situation in the job market. There is a wide and unanimous consensus that the main topic of political debate and the objective of all our actions should be the fight against unemployment. So why is not possible to reach unanimous agreement to alter this decision, which will clearly create so many additional unemployed?
The new President of the Council, Austria's Federal Chancellor, yesterday appealed to the EU partners to make the fight against unemployment the focus of their attention. If he means that seriously, than he should convince his partners that by keeping duty-free, many jobs would be saved.

Pinheiro
Mr President, ladies and gentlemen, the system that applies to duty-free sales up to 30 June 1999 involves the exercise of controls by the seller over his own sales.
Two years ago, in July 1996, the Commission drew up a report on the application of these controls by Member States. The conclusions were somewhat negative, inasmuch as they highlighted, in particular, the diversity of the measures taken at national level and the gaps in their control systems. At this point I would like to thank Parliament, and especially the rapporteur, Mr Garosci, for his work on this issue, the sensitive nature of which is generally acknowledged.
I am delighted that Parliament agrees with the Commission's approach regarding the conclusion to be drawn concerning controls. The Commission fully endorses the recommendations for the improvement of controls, whether by the airline ticket cancellation method or by increased use of computer technology. Nevertheless, we would draw your attention to the fact that it is less appropriate to introduce measures of this kind now that we are only a year from the deadline of 30 June 1999. The fact is that the need to introduce additional control measures would require further investment, which might amount to a misleading signal to operators as regards the deadline of 30 June 1999.
I would also emphasize that since preparing its report the Commission has been informed that operators have tightened up their controls. They have already started to make the adjustments that will be necessary until these sales are abolished, and will now have to concentrate their efforts on actions at ground level.
Mr President, I would now like to talk about the proposed changes, most of which are separate from the question of controls and relate to the general problem of duty-free sales. On this point, my colleague, Mario Monti, has had occasion to explain the Commission's position to you a number of times. I can confirm that there has been no change in that position, and indeed it has recently been reaffirmed here at the Ecofin Council on 19 May 1998. I would, therefore, like to restrict myself to the following observations.
In the first place, we will not in any way entertain the suggestion that the date for abolition of these sales should be postponed. On 19 May, let me say again, the Ecofin Council gave no indication to that effect, not did it even agree that the debate should be re-opened. It also seems to me that any association between duty-free sales and the introduction of the euro would be artificial or even dangerous for the image of the Community. The Commission still considers that Member States are in the best position to examine the consequences of abolishing duty-free sales at national level, and to take the appropriate decisions, if necessary.
There are also a certain number of changes relating to sectoral and regional support measures. These recommend the use of Community funds to assist in dealing with local difficulties. Measures proposed by Member States which involve the use of Community mechanisms, such as Structural Funds, will be considered by the Commission on the merits of each case. In addition, the Commission has promised the Council that it will draw up a working document clarifying which Community instruments can be used by Member States in that connection. Obviously the European Parliament will be kept informed.
Finally, Mr President, Community legislation does not contain any provision allowing passengers travelling to third countries to buy duty-free goods at airports within the Community where they first embark. This is initially an intra-Community flight. There is nothing, however, to prevent contact between strictly Community passengers and passengers travelling to third countries. This fact could lead to abuses which would be unacceptable to the Commission and Member States.

Garosci
Mr President, I would very briefly like to thank the interpreters for going beyond the maximum time limit and for bearing with me earlier when I forced them to rush during the reading of my speech. I would also like to thank the draftsmen and remind them that I have only tabled two amendments for tomorrow. If these two amendments go through - and I also say this to the Commissioner - we will solve a lot of the sector's problems. The first amendment concerns the possibility of making purchases already at the points of sale of boarding, something that according to our verifications I do not believe is contrary to Community rules; the second amendment is to use regional funds. I repeat, if these two amendments go through, we will be solving most of the sector's problems.

President
Thank you for those concluding remarks.
The debate is closed.
The vote will take place tomorrow at 11.00 a.m.
(The sitting was suspended at 8.15 p.m. and resumed at 9.00 p.m.)

Recognition of professional qualifications
President
The next item is the report (A4-0232/98) by Mrs Fontaine, on behalf of the Committee on Legal Affairs and Citizens' Rights, on the proposal for a European Parliament and Council Directive amending Directives 89/48/EEC and 92/51/EEC on the general system for the recognition of professional qualifications and supplementing Directives 77/452/EEC, 77/453/EEC, 78/686/EEC, 78/687/EEC, 78/1026/EEC, 78/1027/EEC, 80/154/EEC, 80/155/EEC, 85/384/EEC, 85/432/EEC, 85/433/EEC and 93/16/EEC concerning the professions of nurse responsible for general care, dental practitioner, veterinary surgeon, midwife, architect, pharmacist and doctor (COM(97)0638 - C4-0657/97-97/0345(COD)).

Fontaine
Madam President, ladies and gentlemen, we approve the Commission's underlying principle in presenting us with this proposal for a directive on the recognition of qualifications, that is, the consideration of three distinct elements: firstly, to take account of the initial lessons to be drawn from experience and, in this respect, I would like to point out that our European Parliament had very carefully studied the Commission's first report in April 1997; secondly, to take account of the SLIM initiative aimed at rationalization; and, finally and obviously, to take account of the development of the case-law of the Court of Justice.
On this basis, the Commission proposes some measures which will, undoubtedly, make it easier to grant recognition of qualifications, by incorporating, in particular, the principle established by the Court of Justice in the Vlassopoulou judgement which puts a value on professional experience. I would remind you, ladies and gentlemen, that our European Parliament had frequently argued this point and we are absolutely delighted that the Commission has listened to our demand and has respected the commitments it had formulated in this connection.
Our wish to have the powers of the group of coordinators strengthened and extended has also been heard. Our Committee on Legal Affairs and Citizens' Rights was able to talk to the group of coordinators and question them. We noted that they were putting together key items in the provisions for the practical application of the system of recognition of qualifications.
As we are now dealing with horizontal modifications of sectoral directives, we are delighted that the Commission is tackling the problem of Community nationals who have had training outside the European Union. This is a very delicate matter, which has been frequently raised and which often continues to be raised by our citizens. Of course, the Commission is still taking a very timid approach since all that is happening is that the qualifications in question are only being taken into account, rather than being recognized. Nevertheless, we consider this to be progress and we welcome it as such.
The specific amendments of sectoral directives do not require any particular comment from our Committee on Legal Affairs. I would simply like to say that, in this context, we thought it important to point out the need to find an appropriate solution for Irish architects whose training could not be recognized in time for that to be possible. I think it is worth saying that such recognition could not go beyond the specific problem raised, and we would like to hear what the Commission has to say on this point.
Finally, we have no objection to the reform of the advisory committees, which would make them less cumbersome and more flexible, inasmuch as - and I would like to stress this point - these committees will be required to operate with maximum efficiency and transparency, and we are making a number of proposals to this end.
Please allow me, Madam President, to finish with a much broader observation. Today, our three institutions feel the urgent need to bring the citizens of Europe closer. I am tempted to add that we say this every time. Moreover, we are not forgetting that the people of Europe face two very important stages in the months ahead: ratification of the Amsterdam Treaty in those countries where this has not yet happened, and, of course, the elections to the European Parliament next June. What better way could there be of achieving this aim of getting closer to our citizens than to make it practically possible for citizens to carry out their profession without hindrance outside of their own national borders? However, we have to recognize that we are not there yet. Our Committee on Petitions could, moreover, bear witness to this as it receives a constant stream of complaints on this subject and we know that most of the complaints involve the refusal to grant recognition.
Commissioner, we know that the Commission is very aware of this, but more than being aware of it, we must act and remove the last obstacles which remain. To date, we have received no formal assurance from the Commission that the revision of the system will take place, as expected in 1999, following a substantial evaluation of its implementation. That is why we are sending you a very strong signal via the amendments from the Committee on Employment and Social Affairs which our Committee on Legal Affairs has taken up. Commissioner, can you give us an assurance that there will be a new directive in 1999, and that this directive will go as far as possible in the right direction? The European Parliament and the citizens of Europe are waiting for an encouraging reply from you and I would like to thank you in advance.

Morris
Madam President, there is no doubt a great need for mutual recognition of professional qualifications throughout the EU Member States. We have heard of cases in which a well-qualified professional person from one Member State is denied a job or compelled to accept a lower salary in another Member State because his or her qualifications are not recognized as equivalent.
Mrs Fontaine's report will extend freedom of movement in actual practice, allowing workers greater mobility and ensuring greater transparency in legislation. Experience and qualifications meeting minimum standards gained in one Member State should contribute towards the experience required in another Member State. To ensure equality throughout the Union, if Member States require professionals to undergo further tests, they should firstly inform the Commission. This proposal is not only a welcome move towards transparency in decision-making we should also see it as a move against unfair discrimination and even xenophobia.
Xenophobia and racism are already prevalent throughout the Union. Especially with the onset of enlargement, my fear is that it will increase dramatically unless we can set in place measures which bring about fairness in recognition of qualifications. This proposal of Mrs Fontaine will give well-qualified migrant workers from countries outside the EU who have worked in one Member State the right to transfer their skills and expertise across the Union. I therefore propose that a certificate of equivalence be issued by the host state to ensure that these workers from third countries gain equal - no more, no less - rights to their counterparts in other EU states. I urge Parliament to support the Fontaine report.

Banotti
Madam President, I would like to congratulate Mrs Fontaine on her excellent report. She has a very distinguished history in dealing with these issues. I have to confess to a certain national relief that Mrs Fontaine has accepted the amendments relating to the rather unique position of the Irish architects. I am most grateful for that. This has been a difficulty in my own country for as long as I have been in Parliament. As both previous speakers have said, the Committee on Petitions receives more petitions from people who are experiencing discrimination in relation to the recognition of their professional qualifications than for any other single issue affecting our citizens.
To give you a bit of history, you may recall that the first directive on architects came at the end of 18 years of trying to decide what an architect was. The architects' directive became the first under the Fontainebleau Agreement to say finally: Let us get out of the deep water and recognize certain basic qualifications. At the beginning this was not noticed and in many cases with the first attempt to draft some kind of recognisable harmonization of qualifications, the vast majority of professionals in all areas of life in our countries were simply unaware of the need to feed into that process and to take care of their best interests.
That is the reason why there is this anomaly in Ireland which Mrs Fontaine has very generously agreed to accept as an amendment to her report. I look forward to hearing whether Mr Pinheiro is going to accept the amendment. This significant group containing some of our most eminent architects will receive this recognition. The practical aspect of it is that without this kind of recognition they are unable to tender for contracts outside their own country.

Gebhardt
Madam President, ladies and gentlemen, we are so used to the thorough and committed approach of the rapporteur, Mrs Fontaine, that I have to say that there is almost nothing left to add. Today's agenda includes a whole string of reports which are important for our citizens. These include, in particular, citizenship of the Union and the directive now before us, which is to amend 14 different directives on the recognition of professional qualifications. The updating of mutual recognition of professional qualifications which we are debating today is especially important for young people, who are expected to be ever more mobile. On behalf of the Group of the Party of European Socialists, I would, therefore, specifically like to welcome the European Commission's response to a request made by Parliament on several occasions, to the effect that nationals of Member States who complete their education outside the European Union should also be taken into account.
The approach adopted is tentative. We would have preferred actual recognition. Nevertheless, we realize that the Commission needs to gain experience in this area before it goes any further. We also specifically welcome the simplification of the advisory committees and the extension of their powers. My group also fully supports the amendments, which will lead to greater transparency, and which call for the deliberations of the Coordination Group to be made accessible to the general public. It is only in this way that we can genuinely respond to the public's demand for greater transparency, making the results easier for our citizens to understand.
We have deliberately refrained from tabling more far-reaching amendments at this stage, because we are aware that the Commission needs to embark on a general process of further simplifying legislation in the general area of mutual recognition of professional qualifications and must do this by 1999. For this reason, we are somewhat impatient to see the report the European Commission is to prepare on its experience to date with the implementation of the directives.
We were promised this report for this spring, but it is still not available. We need this report quickly, as we want to create as positive a future as possible for young people. That is our job as legislators and we want to do justice to this task.

Añoveros Trias de Bes
Madam President, our Vice-President, Mrs Fontaine, has produced an exceptional report as always. The Committee on Legal Affairs, as Mrs Banotti has commented, has adopted a very clear position on the matter, and at the meeting of 23 April it examined the proposal and approved it unanimously.
The directive brings the whole Community system for recognizing qualifications up to date and gives concrete expression to its undertaking to simplify the up-dating of qualification lists.
To recount the events that support this measure: the Commission has submitted a report on current progress in the implementation of the general system for the recognition of higher-education diplomas; there have been developments in the case-law of the Court of Justice, which has given several preliminary rulings; and the Commission has sent the Council and Parliament its communication on the SLIM initiative.
The result of all this is a proposal to amend at least 14 directives, a number of which have certain problems in common, and it is thus possible to identify them and examine them much more systematically. Experience shows that this formula guarantees a sufficient degree of legal certainty and fully respects the principles of subsidiarity and proportionality.
The contents of this proposal will incorporate the principle of case-law whereby, on receiving an application for the recognition of a qualification, the host Member State must take into consideration the experience acquired by the interested party since that qualification was obtained. Directive 89/48 must also introduce the concept of regulated education and training. The aim of this is to oblige the host state to take account of any education or training received by the emigrant even if the Member State of origin or the home Member State has no corresponding regulation of the profession to which such training relates. This new provision will make it possible to prevent the host state from demanding years of professional experience.
Three explanations should be made regarding the Committee on Legal Affairs' interpretation of these amendments. The first is the amendment of the 1989 and 1992 directives relating to the general system. From now on, the host Member States must recognize a citizen's even where training, as I mentioned, the Member State does have any corresponding regulation. The second is the horizontal amendment of the directives. The third is the specific amendments to the sectoral directives, implementing specific amendments and adjustments, and updating lists of diplomas, certificates and other qualifications.
In my opinion, the directive has advantages: it incorporates into the general system the obligation, which - as I have already said - is established in case-law, whereby experience gained after obtaining a qualification is taken into consideration when considering the application for recognition, and it introduces, too, the concept of regulated education and training.
By way of conclusion, it may be said that this directive responds to the need to enable citizens of the Union to work where they like by recognizing their higher education and professional training qualifications. In short, the aim is to ensure that no citizen of the Union is ever again confronted with same old problem, and to create genuine freedom of movement through this directive.
These, Madam President, are the objectives. Will it all work in practice? Obviously the directive is a very important step in that direction, and it is logical that we, the Members of the European Parliament, should place very significant emphasis on it.

Oddy
Madam President, I agree with the previous speakers that Mrs Fontaine has produced an excellent report. It is an important plank in the free movement of workers which is a basic right in the Treaty of Rome. If qualifications are not recognized by other Member States, then mobility is extremely difficult for workers to achieve. Sadly, problems still occur in this area and most MEPs receive case work on this subject. Therefore, the directive is welcome as it addresses an important problem.
There are two main thrusts to the report. Firstly, it applies to two general directives on higher education diplomas and on professional education and training. The second area relates to specific professions such as nurses, veterinary surgeons, midwives, architects, pharmacists and doctors. In particular, the report seeks to set out clearly the provisions for Member States being allowed to apply aptitude tests. Although we see the sense of aptitude tests, sometimes Member States have used them to distort the true purpose of the directives. I reiterate the points made by Mary Banotti. I too have had correspondence on the specific problems of architects. I trust these have been successfully resolved.
I can only stress that in my view the free movement of workers is essential for the proper operation of the Treaty of Rome. I commend this report.

Malone
Madam President, I should also like to thank Mrs Fontaine for a very excellent report and also my colleague Mrs Berger who took on board several amendments regarding the architects.
As you know, in the original directive of 1985 on the recognition of architects' qualifications, certain Member States did not get derogations for what is known as an established right to practice. These architects were seen by the competent authorities in their Member States as having sufficient acquired experience and ability to be allowed to practice as de facto architects. This was despite their not having the exact qualifications laid down elsewhere in the directive. Unfortunately, while countries like Germany, the Netherlands and the UK received the derogations, Ireland did not. The result was huge discrimination and a large group of practising Irish architects of great ability and experience failed to get their status recognized elsewhere in the Community. This situation continues to this very day.
The amendments we tabled and which have been taken on board by the Committee on Legal Affairs and Citizens' Rights will hopefully help to bring about the free movement of workers, as Ms Oddy mentioned, and these people will be able to practice anywhere in the Community. I hope I will be able to report back to these architects that the result of what we are doing here today in conjunction with the Council will contribute to the ongoing completion of the single market.
It is up to Member States to recognize these workers' rights to fair treatment and I hope that Member States and the Commission - especially Commissioner Monti, who has been rather intransigent on this whole issue and I hope the message can be taken back to him - can agree that those countries that did not apply for the 1985 derogation should have the right to do so now.

Berger
Madam President, ladies and gentlemen, I too wish to express my very warm thanks to Mrs Fontaine for paying special attention in her report to the outstanding proposals regarding the directive on architectural qualifications. Parliament only recently had occasion to formulate some of these proposals when it considered a report specifically about the architects' directive which I had the honour of drafting. Thanks to Mrs Fontaine's report, these proposals may now be implemented. This applies in particular to Amendment No 14, which has already been mentioned several times today. Its aim - and like Mrs Fontaine I wish to stress that this is its only aim - is to give a small group of Irish architects a fresh chance to have their qualifications and attestations of competence recognized, something they were inadvertently deprived of when the directive was implemented in Ireland.
The architects' directive has a number of peculiarities that set it apart from the other directives, which is why we also wish to keep this as a separate directive. However, these peculiarities in no way justify the fact that the advisory committee established under the architects' directive is to be excluded from the proposed reform of all the advisory committees. Just as with all the other directives, a reduction in the number of members on this committee and more effective procedures would also help to improve its workings under the architects' directive.
I would also like to emphasize that a solution to the problem of recognizing educational qualifications gained in third countries is also of great importance in the architectural world.

Pinheiro
Madam President, ladies and gentlemen, first of all I would like to thank Parliament for the interest which it has shown in this proposal and for the important work carried out by the Committee on Culture, Youth, Education and the Media, the Committee on Employment and Social Affairs and the Committee on Legal Affairs and Citizens' Rights, as well as the rapporteur. I would like to thank Mrs Fontaine in particular; she has provided an excellent summary of all the proposals, reports and amendments which have been tabled.
The Commission is delighted to see that the substance of its proposal has been well received. The main aim of the Commission's proposal, in accordance with the recommendations of the team on recognition of qualifications, is to simplify the updating of the list of qualifications appearing in the sectoral directives, as part of the SLIM initiative: nurses, dental practitioners, veterinary surgeons, midwives, pharmacists and doctors. This new proposal has been seized upon as an opportunity to implement other recommendations which appear either in the Commission's report on the general system for the recognition of professional qualifications, or in the Commission's report on specific training in general medical practice.
It is, therefore, in this context that the amendments tabled by your Parliament should be considered. In this respect, we unfortunately have to note that the majority of amendments would, if accepted, impede the efforts aimed at simplifying laws and administration, since they are likely to impose new procedures which would sometimes be very onerous on Member States and/or on the Commission.
Examples of this are Amendments Nos 1, 4, 6 to 9 and 11, which seek to oblige Member States to inform the Commission of their intention to introduce compensation measures for each professional sector involved. It is also true of Amendments Nos 5 and 10, since they tend to afford a great deal of publicity to the deliberations of the Coordinators Group. It is further true of Amendment No 12, which extends the system for updating the list of qualifications proposed by the Commission, and delays its application. Amendments Nos 3 and 13 aim to establish automatic recognition of training obtained in a third country, where these have already been recognized by the first host state within the EU. On this subject, the Commission wishes to reiterate its position expressed during the consideration of the proposal for a directive aimed at inserting comitology rules into Directive 1100. This is a matter which will be studied further, after the publication of the report which the Commission will present in 1999 on the general system for the recognition of professional qualifications.
The Commission therefore believes that the proposal contained in Amendments Nos 3 and 13 is premature. As regards Amendments Nos 2 and 14 concerning the architects' directive, the Commission carefully notes the invitation extended to it via Amendment No 2 to give some thought to the desirability of including in the architects' directive the formula to simplify the updating of the lists of qualifications. We will consider this matter. As to the message contained in Amendment No 14, which aims to regularize the situation of some architects, the Commission would like to point out that your Parliament rejected a similar proposal when considering the report on the architects' directive on 26 March last. On that occasion, Parliament suggested that Article 7 of the Directive already offered an adequate opportunity. Amendments Nos 15 to 21, in the field of general medical practice, will also be looked at in the context of the Commission's report on the system of recognition for professional qualifications, to be presented, as I have said, next year.
In conclusion, Madam President, ladies and gentlemen, the Commission cannot support the amendments which contradict the legal and administrative simplification sought by the SLIM initiative, or which are contrary to the letter and spirit of current directives. It notes the messages contained in other amendments, and will present the result of its deliberations as and when appropriate.

President
Thank you very much, Commissioner Pinheiro.
The debate is closed.
The vote will take place tomorrow at 11.00 a.m.

Citizenship of the Union
President
The next item is the report (A4-0205/98) by Mr De Clercq, on behalf of the Committee on Legal Affairs and Citizens' Rights, on the second report from the Commission on citizenship of the Union (COM(97)0230 - C4-0291/97).

De Clercq
Madam President, Commissioner, ladies and gentlemen, what is the state of the citizenship of the European Union? This is the question concerning us in this debate. A number of rights to which European citizens can lay claim have been incorporated into the Maastricht Treaty under Article 8. Union citizens comprise all those possessing the nationality of one of the Member States. Fortunately, the Amsterdam Treaty specifies that Union citizenship is complementary to national citizenship.
The implementation of rights associated with European citizenship has accomplished much, though there is still room for improvement. Allow me to put forward some key points.
As far as the right of persons to move and reside freely in the whole of the European Union is concerned, we are certainly dealing with a right which is possibly the most concrete for citizens. It is, therefore, unfortunate that these same citizens still experience so many difficulties. The main cause lies in the fact that this right is regulated through different clauses, depending on the category of citizens. We would, therefore, call on the Commission to convert all existing legislative instruments to an easy and generally effective instrument.
Free movement and residence in the Union will not come about until the last barriers are lifted, including: the abolition of all border controls and the comprehensive acceptance of the Schengen acquis; education systems which are geared to each other, aimed at the mobility of employees with children of school-age; a simplified recognition of all diplomas and professional qualifications, in particular for young people; the tracking down of unfair administration practices which are practised by national governments to hinder the policy right; and the protection of rights relating to supplementary pensions. There is much to be done. Another important point is the direct functioning of Article 8a. This would mean that each citizen would be able to petition their right to free residence and movement in front of any national judge in the Union.
As far as the active and passive right to vote in local elections is concerned, I will be brief and to the point. This means that the right to vote in local elections should be introduced for all EU citizens by all Member States, including Belgium. France has done so already. In terms of the active and passive right to vote in the European elections, the implementation of the directive by all Member States should be simpler and more uniform. EU citizens often are not aware of how they can exercise this right in the Member State in which they reside. Better information is, therefore, required.
As far as consular and diplomatic protection is concerned, we are only just at the initial stage. A common definition must urgently be sought, so that the European citizens realize that this produces added value outside the Union as well.
As far as the right to petition and the right to apply to the ombudsman is concerned, the first annual report by our European ombudsman shows how these rights are useful and necessary, even if their exact scope is still unknown. Here, too, better information is required.
In conclusion, I would say that the Amsterdam Treaty has added something, namely, the right to apply to any European institution in one of the official languages of the Union and the right to reply in this language. However, this has not yet been implemented and can, therefore, not be evaluated today.
Madam President, ladies and gentlemen, the introduction of European citizenship underlines that European integration is also a political project. The rights associated with this must certainly make an essential contribution to a greater European awareness in the same way the plans relating to jobs, and recently the euro, have undoubtedly brought Europe closer to the citizen
Our task is to make this permanent and to show the citizens that Europe offers added value, and is there for them. This is not only done by legislating for a number of citizenship rights through a Treaty. It is just as important for these rights to become known and for them to have sufficient content and not least their practical implementation is of fundamental importance.
Free movement, the right to free residence, the right to vote, the right to apply to an ombudsman belong, of course, not just to the European Union. They belong to any self-respecting democratic constitutional state. Whatever its importance, it is not sufficient to involve the citizen closer in Europe. More attention paid to European symbols or to our shared history will certainly help us, but we are in urgent need of restoring the confidence of the citizen in Europe. This requires a change of mentality amongst not only the citizens, but first and foremost among the European decision-makers, the administration and the media.
The Europe of the citizen begins with those who are concerned every day with European matters. They must prove their solidarity with Europe. The European Parliament has a large role to play in this. Parliament is one of the main players and we help to determine the strategy. As European representatives we must ensure that the citizen is involved as much as possible in this game, that the game is an attractive one and, in particular, that we ourselves adhere strictly to the rules. In short, we must set a good example in Europe. Good examples always come from the top.

Ullmann
Madam President, Commissioner, anyone who has ever worked on the European Parliament's Committee on Petitions knows how much trust citizens' petitions express in the institutions of the Union. For that reason, citizenship of the Union has to be strengthened, developed and made a separate issue if we want to reduce the present democratic deficit in the Union. The Commission's report formed a good basis for Parliament's opinion, because it openly addressed the evident shortcomings and weaknesses in the current legal position and practice. I do not need to repeat the details, so I shall restrict myself to those areas where we need to go beyond the Commission's observations.
We need to surmount the limited and sectorally circumscribed applicability of the article on freedom of movement, Article 8a. At the very least, the right to invoke freedom of movement in national courts should be upheld, as called for by the rapporteur. The most effective way of doing this would be for a charter of fundamental rights to be included in the EU Treaty, which would define citizens of the Union as those entitled to the rights contained in it. Access to citizenship of the Union should not depend solely on nationality but should also be open to nationals of third countries after five years' residence in the Union. Moreover, it is a matter of the utmost urgency, in view of the forthcoming elections in 1999, that the obstacles to exercising the right to vote in European Union elections which still exist in some Member States, and which are generally of a simply administrative nature, should be eliminated.
We are delighted that France's National Assembly has just removed an important obstacle. This is exactly the kind of thing that will make citizens of the Union feel that we are not just talking about their rights, but actually doing something about them. My thanks go to everyone involved in this work, to the Commission and, above all, to the rapporteur, who has truly led the way here.

Gebhardt
Madam President, ladies and gentlemen, the rapporteur deserves to be congratulated on his thorough and committed work. I offer these congratulations without any reservations, but at the same time I must admit that I am somewhat envious of Mr De Clercq. I envy him the auspicious moment at which he is presenting his important report on citizenship of the Union. The timing could not be better! With the introduction of the euro, we have laid the last foundation stone for Economic and Monetary Union. Now we can concentrate on our citizens, on their wishes and dreams. There is nothing more to stop us going ahead with European political union at full steam. The De Clercq report points in the right direction, and my group will therefore be voting for it.
We have tabled a few amendments, but they are not at odds with the report. They are simply intended to amplify certain areas and make some points even more explicit. I hope that the rapporteur will see it that way, and that he will find this helpful and recommend acceptance of our amendments. The recitals include various references to encouraging citizens' European awareness. What could be more obvious than to demonstrate this awareness with a symbol as delightful as a common European holiday?
But we must not fool ourselves. Our citizens will not be satisfied with symbols and fine declarations alone. They expect citizenship of the Union not just to deliver rights on paper, but also tangible advantages. Our citizens expect political union in Europe to make their everyday lives easier. For instance, let us take the example of the citizen's right to freedom of movement, which we love talking about, but which so far has only progressed in Lilliputian stages. Our citizens cannot see any more than that. Freedom of movement is not just a question of pulling down barriers: first and foremost, it is about dismantling bureaucratic obstacles. The Commission must, therefore, immediately bring forward a legislative proposal to eliminate differences in rights of residence as between Member States and to promote genuine freedom of movement for the Union's citizens. In particular, we need to remove obstacles to mobility for young people and to make it easier for them settle wherever they wish. We therefore need simple, easily comprehensible and unbureaucratic means of recognizing diplomas and professional qualifications, which we have just been talking about.
That means that school-leaving qualifications, professional qualifications and diplomas should be equally valid in all Member States. If we adopt this approach in all areas, we can transform citizens' rights from pieces of paper to a living European reality. There is a long road ahead of us, and we should never forget one thing: we should be focusing on people and not on profits.

Palacio Vallelersundi
Madam President, it really is reassuring to listen to this report here today. It is reassuring because the conclusions of the Cardiff European Council are still ringing in our ears, and because we can still hear the echoes of recent statements that people want less from Europe, less integration, declarations that even call for certain policies to be placed back in the hands of the national authorities. I therefore think it important that the European Parliament is today flying the flag of citizenship in the splendid presentation we have heard from the Chairman of the Committee on Legal Affairs and rapporteur.
It is a balanced report; balanced between the real world and symbolic values; balanced between practical measures and the poetry, which Mrs Gebhardt mentioned. We too need a little imagination and poetry.
Among those practical measures, Mr De Clercq has emphasized the need for the free circulation of persons and choice of country of residence for European citizens to become a reality. Article 8a must also become a reality that can be directly pleaded in our courts of justice. Publicity must be given to the rights already conferred by this still embryonic European citizenship, such as the right to vote in local elections and the right to vote in European elections. Finally, we must continue to create - and this is where we move from reality to poetry, from reality to the realms of myth - symbols of integration. We need to make Europe exist as a cultural concept.
The European People's Party will not only support Mr De Clercq's report, but also the Socialist group's amendments and some of those tabled by the European People's Party, although we have rejected Amendment No 5.
The fact is, Madam President, that these are bad times for Europe. Against such scepticism, it may be said - and here I agree with Mrs Gebhardt - that our ally, paradoxically enough, is the market. Life is full of paradoxes: the Europe of the markets is going to help us to create a real Europe of the citizens, because if the euro is to succeed, if the single market is really going to work, we shall have to shape free circulation in its fullest sense. We shall have to move on to further integration.
And therefore, Madam President, I believe that here today, at the beginning of the Austrian presidency, we must all congratulate ourselves on this European Parliamentary report which, once more, reaffirms its role as the voice of conscience, as a warning, against certain circumstances which today seem to advocate a hard-nosed, short-sighted Europe. Now, against that hard-nosed, short-sighted Europe, the European Parliament is raising its voice, and that of its citizens, saying that Europe will come into being only through integration, and that, in contrast to the concept of the Europe of the markets, we have to ensure that the reality of the Amsterdam Treaty translates into a genuine citizens' Europe.

Voggenhuber
Madam President, I want to congratulate the rapporteur, and I am pleased that Parliament is once again advocating the implementation of the rights enshrined in the Treaty, in the framework of citizenship of the Union. I would like to suggest that we take a look at the fundamental significance of citizenship of the Union. What is it all about? I firmly believe that it means the Union recognizing nothing less than that our citizens are the driving and sovereign forces of the European unification process. Citizenship of the Union therefore plays a key part in legitimizing the Union. And it is not just legitimized indirectly via national governments and treaties, but also directly, personally and immediately, by giving all citizens a legal status.
Citizenship of the Union was, therefore, quite logically introduced in the Treaty on European Union to strengthen the protection of the rights and interests of the nationals of its Member States. We are, therefore, looking at a statute that covers the fundamental and civil rights of all citizens. So far, so good, as far as the theory goes. In practice, however, we are still a very long way from achieving an all-embracing guarantee of fundamental and civil rights, from recognizing the citizen's sovereign role in integration. Of the four freedoms, surely the most personal, the most existential, the most human is freedom of movement of persons, the implementation of which has been the most protracted, subject to the greatest reluctance and has had the most obstacles put in its way. Border checks for individuals have not been abolished. They have not been eliminated by the Schengen Agreement, but rather replaced by barriers that are sometimes even higher than the old ones we pledged to get rid of.
The right to vote and the right to stand for election to the European Parliament is often undermined, and even more so the right to participate in local elections. These rights are often sabotaged to some extent, and in some capitals, in Vienna for example, they are limited to taking part in city district elections. Consular protection is also virtually non-existent in practice. However, I also believe that we have to look beyond the Treaty texts, and the rights enshrined in the Treaty, to the comprehensive protection of fundamental and civil rights. I hope that the special summit in Vienna will allow us to progress from mere technocratic institutional reform to genuine democratic reform.

Oddy
Mr President, I should like to thank the rapporteur for his learned and thoughtful report and commend his European vision.
If we are to ensure that the European Union flourishes, the citizens of Europe must feel that we have ownership of this project and that we benefit too, not just the commercial organizations and governments. The Commission's second report on citizenship is therefore an important plank in building a corps d'esprit and a sense of European belonging.
I particularly welcome the right to vote and stand as a candidate at municipal elections in the European Parliament, although I would flag up the generous voting rights granted to Commonwealth citizens in the UK and urge there is no reorganization of this and no attempt to water down the rights which exist.
As draftsperson on the Commission action plan on free movement of workers, I welcome the remarks of Mr De Clercq on obstacles to the free movement of people, such as pension mobility, family responsibilities and the educational needs of children. I fear that this is a little adventurous for my British group as yet but I believe the Commission could look at promoting the international baccalaureate.
The creation of the Ombudsman can only be commended but I feel that its office needs greater promotion. I agree that the key to feelings of closeness with the European Union hinge on information. I therefore ask the Commission to make even greater efforts to inform the citizens of Europe.

Zimmermann
Madam President, ladies and gentlemen, this evening's debate is concerned with citizenship of the Union. We all know what that means and what a key role citizenship of the Union occupies for the citizens of Europe, and above all in European integration. But I wonder if people in Europe actually know about this? Do the very people whose rights are associated with citizenship of the Union know this? Do they know to whom they can turn, whom they can ask and where they can obtain information? In the course of many conversations with ordinary citizens, I have repeatedly had the feeling that people only have a sketchy idea and precious little knowledge about this.
However, it is not only our citizens who know very little about this. For example, take a look at the information issued by the European Commission, which often does not deal with certain areas at all. For instance, we were recently sent a brochure, the Single Market Review, which contains over 38 reports describing how the internal market is being implemented in practice. Yet this brochure contains next to nothing about freedom of movement. When I see that, I wonder how our citizens are actually supposed to be informed! Another example: when I mention to officials in the Commission or Parliament or even outside that as a citizen of the Union with a Dutch passport I have a seat in the European Parliament for Germany, I always get asked: how is that allowed? Where does it say that? How is that possible? This demonstrates that even the right to vote and to stand for election, to the extent that it must be in the Treaty, is something we have not really grasped. Nor has it really been grasped by the people who decreed it or by our citizens or by my colleagues. Many of my colleagues have not actually realized this yet either.
I think it is important that we ourselves should take on board citizenship of the Union, with everything that it implies, and give it serious thought. We will then be better placed to inform people about it, so that people really understand it too.

Pinheiro
Madam President, on behalf of the Commission, I am very pleased with Parliament's detailed examination of our second report on citizenship of the Union and, in particular, I would like to highlight the excellent work of an outstanding European called Willy De Clercq.
I consider this debate on citizenship of the Union as a kind of invitation to all politicians to concentrate on the essentials of the construction of Europe, and a warning regarding the advances and setbacks that are taking place in the construction of Europe, and may detract from our citizens' sense of 'belonging to a political community under the rule of law' , to quote the expression used in your resolution. As Members are aware, this concern was also expressed at the recent Cardiff European Council, where it was declared that all citizens should be able to benefit from the advantages of Economic and Monetary Union and the single market, and that the Union should be brought even closer to ordinary citizens.
This second report on citizenship of the Union covers 1994, 1995 and 1996. It therefore pre-dates the conclusion of the Intergovernmental Conference that led to the adoption of the Amsterdam Treaty. In this report, the Commission has been at pains to describe and analyse the new rights conferred by the Maastricht Treaty, to investigate what progress has been made since the publication of its first report in 1993 and to indicate a series of objectives to be achieved.
Your motion for a resolution is rightly addressed to all interested institutions, and likewise to Member States. The fact is that future progress can only be achieved by means of combined action at all levels, particularly in the field of improving legislation by making it more readable and capable of more efficient application. I can assure Mr Willy de Clercq and this House that as far as Schengen and the application of Article 8a are concerned, the following issues are on the table before the Commission: infringement procedures, administrative practices, the right to vote, consular and diplomatic protection, permanent dialogue mechanisms, education and the recognition of qualifications, protection against threats to individual safety and freedom and trade.
Even today, at the Commissioners' meeting, the first part of the meeting was, in fact, dedicated to European citizenship. And we hope that with the impetus provided by this House and input of the kind we have received through this resolution, we can all achieve real citizenship that much earlier.

President
Thank you very much, Commissioner Pinheiro.
The debate is closed.
The vote will take place tomorrow at 11.00 a.m.

Safe use of the Internet
President
The next item is the report (A4-0234/98) by Mr Schmid, on behalf of the Committee on Civil Liberties and Internal Affairs, on the Commission proposal for a Council Decision adopting a Multiannual Community Action Plan on promoting safe use of the Internet (COM(97)0582 - C4-0042/98-97/0377(CNS)).

Schmid
Madam President, ladies and gentlemen, until a few years ago, the Internet was the preserve of specialists. Today it is so much a part of everyday living that even we as Members have access to the Internet in our offices. This is clear proof that miracles can still happen! The Internet offers great potential - more than ever before in human history - to gain rapid access to a large volume of information. On the other hand, there is also a certain amount of material on the Internet which is harmful to minors or illegal. Also, like traditional forms of telecommunication such as the telephone or even the post, it can be used for criminal activities.
The advantages of the Internet largely outweigh its disadvantages. Nevertheless, action is needed on the problems I have touched upon and we need answers. But the answer cannot be a stricter yardstick than we apply to other media such as film or television. Just because there has been a heated debate, especially on the part of people who have never used the Net for a single second, it does not mean that we should treat it differently from other media. The response should, therefore, reflect the specific characteristics of the Net rather than stipulate stricter standards.
What is special about the Internet? First of all, it does not belong to anyone. No-one is the overall owner of the Internet. I always say that it is really a fundamentally communist structure. Second, the Net is global and, therefore, accessible worldwide. Third, legal action against criminal content is in accordance with the criminal law of the country where computer on which the data is stored is located. Fourth, material can be transferred from one computer to another easily and quickly, in just a few seconds. Fifth, access to the Internet is anonymous. A computer cannot tell who is sitting on the other side of the screen and it is not limited to certain times.
This has implications for the protection of minors, because on the Internet there is no-one behind the counter or in the ticket office as there is in a cinema or video shop, who can say to a six-year-old 'you cannot come in here' or 'I am not letting you take out that video' . That is the real problem. The Action Plan that the Commission has now proposed to us claims to guarantee safe use of the Internet. I believe that it can perhaps help, but 100 % safety is not possible in this case. Furthermore, this idea promotes the misconception that parents no longer need to worry about bringing up their children, because they can leave the protection of minors to technical systems and filter software. We should not be encouraging this misconception. That is why I am in favour of changing the whole concept to 'safer use of the Internet' . That would reflect the real world.
In any case, we need to be aware of the limitations of the measures proposed. Given that the number of commercial pornography providers is growing every day around the world, it would be rather naïve to expect much from self-regulation. The fact that Members of the House yesterday received an advertisement for pornography in their e-mail - not a very good one, incidentally, and the price was far too high - shows the direction we are heading in. The embargo on the Dutch XS-4-All server because the journal Radikal was being disseminated on this server shows how far you get with that approach. Previously, Radikal was only available on that one server. After the embargo it became available on 53 servers on the Internet, because mirror sites were immediately set up around the globe. So the embargo approach has its limitations.
Because of the multiplicity of languages in the European Union, it is also doubtful whether the use of word recognition programmes for filtering would really help. Using image filter programmes also involves blocking all pictorial scientific material and all graphics. I am certainly in favour of this proposal, let there be no misunderstanding. I am simply pointing out that it has its limitations and that we have to be aware of these limitations.
Another of these limitations is that in the real world children generally understand more about computers than their parents do. As regards the idea of installing filter software on PCS, I have put it to journalists like this: filter software is a programme that a 12-year-old can use to prevent his dad accessing porn websites on the Internet, because he has been stopped from watching television. That is how it really is. Nevertheless, I am in favour of using filter software; we simply need to be aware of its limitations.
The proposed action plan is chiefly intended as a tool for combating undesirable content on the Internet, that is to say, pornography, politically extreme sites and so forth. Because the European Union lacks criminal law and law enforcement powers, the action plan addresses illegal content only in terms of encouraging the preparation of a study on national measures necessary.
In my view, the real problem is not so much illegal content as undesirable content. It is truly amazing what you can find if you spend just a few hours on the Net and make a specific search; I was doing that just yesterday while preparing for a press conference. You can find instructions on making your own bombs, unlocking doors without keys, producing illegal drugs, other terrorist activities, forging credit cards, hacking into computers without permission, and so on; a whole range of things.
As things stand, combating illegal content is a matter for Member States. I have no intention of questioning that. In practice, it is made considerably more difficult by the fact that not even in the European Union are there identical or at least comparable legal standards governing important issues. Prosecution in the case of child pornography is difficult if the age at which 'child' stops and 'adult' begins is defined by differing age limits under different legal systems. In some Member States it is 14 years, in others it is 16 years. It is difficult if there is no definition of what illegal pornography is. It is also difficult if an illegal content is subject to prosecution but a pointer from another Internet site to that content, at the click of a mouse, is not itself subject to prosecution. It is quite a simple matter then. It is also difficult if - as is the case today - you can connect a computer to the Net without it being possible to establish who the operator is, and if - as is also possible today - an e-mail can be sent without it being traceable to a particular person, in other words, if servers can be operated anonymously and electronic mail sent anonymously.
We therefore require at least preparatory studies to establish what kind of legislation we need. I know that there has been some resistance during deliberations in Council. Home affairs are now the preserve of the nation state, whereas they have lost military policy: NATO does that now. The only area where there the state has a monopoly on the use of arms is the police. This is the apple of their eye and is protected accordingly. I know that there is some resistance to the idea of embarking on such studies, but they are still needed. The fact is, we can ultimately only solve the problem of illegal content by global agreements. Global agreements on such things will face the same problems as we have with GATT: if the Community turns up with 15 different opinions, we will not get anywhere! If the USA, the European Union and Japan all have roughly the same ideas, it will happen relatively quickly. For that reason, we need to establish common standards, not only because of law enforcement within the European Union, but also because of the need for international agreements. Without such standards we will not make any further progress on this issue. I would like to ask the Commissioner to tell me in his summing up what amendments the Commission is willing to accept, because that would help me.

Argyros
Madam President, the opinion of the Committee on Economic and Monetary Affairs and Industrial Policy on this issue, with the amendments it has tabled, aims to promote the development and the adoption of efficient technical systems, the main aim of which, of course, is the protection of minors and human dignity, but also the strengthening of business and financial activity.
It also attempts to improve global cooperation on this issue, in order to ensure the dynamic growth of the Internet industry. More specifically, regarding the field of implementation of the action plan, and taking account of the possibilities offered by the Internet for financial and business activity, and indirectly in the employment sector, it proposes the adoption of a broader approach. Beyond the issues that affect minors or human dignity, the possibilities offered by the action plan for the protection of financial and business activity will be examined.
The trust of users, both individuals and businesses, of the Internet will create a favourable environment for the growth of business activity in the information society sector. In this way, the Internet will be, in addition to a secure source of knowledge, a valuable tool for business activity.
The second important issue in the opinion concerns the principles which must govern the actions to get rid of the harmful and illegal material on the Internet. Briefly, these principles are as follows.
First, we must support industry in the development and adoption of desirable and effective systems to control the content of the Internet. In addition, cooperation between interested bodies, above all industry, is the determining factor in the successful institution of self-regulatory systems and filtering and rating mechanisms.
The second important condition for the effective control of the content of the Internet is the clear separation of the roles and responsibilities of each element involved in the creation and distribution of that content.
The final point I would like to stress is the demand, due to the transborder nature of the Internet, for substantial cooperation and coordination of the actions of the programme at global level. Cooperation is the only way to ensure maximum efficiency of the actions undertaken at European level. For this reason, I think that the European Union must aspire to a leading and active role in the process of instituting principles and technical models that are acceptable at global level.
In finishing, I wish to congratulate Mr Schmid and my coo-draftsmen on their contribution to the issue of the safe use of the Internet, and to thank them for supporting the opinion of the Committee on Economic and Monetary Affairs and Industrial Policy.

Cederschiöld
Madam President, this is not the first time that we have discussed the Internet, nor will it be the last. Developments are going in the right direction. Not only here, but everywhere, there is growing awareness of the value of this revolutionary form of free information. It is the freedom we should safeguard, not the rules.
A year ago we discussed the Pradier report on harmful and illegal content on the Internet. The demands for regulation from various quarters then were extensive, including the registration of Internet users and a ban on digital encryption. Many were then unfamiliar with the new and thought that old world thinking should also apply to the new world.
Once upon a time, those who did not see the new age wanted to smash Gutenberg's printing press. The Reformation started because they did not succeed. Through the printing press, citizens were given entirely new ways of obtaining new and much more easily accessible information. That time it led to a decentralization of power.
Now we are facing the second reformation in that citizens are able to obtain knowledge and information and become more and more independent of authorities and states. In the long term, this will probably lead to less regulation of the day-to-day lives of individuals and entirely new opportunities for contacts and supply.
However, illegal material on the Internet must be dealt with, but without affecting the basic premise of freedom. The Commission wants to set up direct lines for the reporting of illegal material on the Internet, to support filtering and classification systems and education and information. The report complements the Commission's line by wanting to investigate the legal aspects of harmful and illegal material on the Internet. These are reasonable proposals, since they take into account the nature of the medium.
Before, there was a preoccupation with developing separate European systems. However, we should respect the fact that this is about global and international contacts. It is a global and international medium. The solutions must, therefore, be international and global. Internationally workable systems have already been developed and have won acceptance and popularity. In this context, I would like to thank the rapporteur for having been so accommodating with regard to my amendments in this area.
Finally, I would like to welcome the understanding which has been shown with regard to avoiding compulsory systems. The market has, of course, a direct interest in self-regulation. In addition, quality marking could lead to a better market position for Internet service providers who want to make use of it. It is pleasing that the Commission does not regard it as the task of the authorities to regulate the content and use of the Internet. However, it is the authorities' task to combat and suppress criminality wherever it appears, whether it is with the help of the Internet or out on the streets.

Lindholm
Madam President, the explosive development of the Internet is seen by most of us as positive. However, as we all know, it also has a very dark and unpleasant side. Through the Internet, everyone, including children and adolescents, can easily find detailed recipes and descriptions of drugs, as well as recipes for explosives, paedophiles can look at child pornography and women can be bought and sold, etcetera. It is quite clear that we all want to put a stop to this.
The problem with the Internet's dark side is that it is global and does not recognize any borders. A complete solution must, therefore, also be global and can only be brought about in cooperation with the industry. It is something which we all must work towards. Meanwhile, the Commission's draft action plan is a beginning which could also effectively contribute to a real international debate and hopefully a solution.
Among the most important points in the action plan are the proposal to work together with the industry for self-regulation and codes of conduct, the development of systems for filtering and classification and a broad information campaign. Personally, however, I distance myself from all attempts to regulate the Internet problem through directives at EU level. It is something we have to resolve in a different way and more internationally. I am, therefore, going to vote against Amendment No 23. However, the Green group as a whole is going to support the Schmid report.

Matikainen-Kallström
Madam President, when we talk of the safe use of the Internet, the notions of free expression and the dissemination of illegal material often travel along a collision course. By its nature, the Internet is free and unrestricted, and it must be kept so. The flip side to the coin is always the knowledge that someone is trying to abuse freedoms.
The grossest form of abuse is unarguably the spread of child pornography and paedophile material. The general availability of this material on the Internet is stunning. According to a study by Interpol, the result of just two months' monitoring of the network revealed over 70 000 sights containing images of child pornography. The number is so large that ethical selfregulation among those active on the Internet will not be enough in itself to restrict it.
It would be wrong to charge Internet server providers with transmitting illegal material. Although their role as guardians of self-regulation is a crucial one, we can only achieve the results we want through tight cooperation between the authorities responsible for the form and content of the computer technology industry and the Internet. Because the Internet is a worldwide phenomenon, mere action on the part of Europe will not be sufficient in the struggle against child pornography. What are needed are global publicity and information systems and standards, by means of which those purposely transmitting porn can be caught. A good example of official initiative in the fight against child pornography is the tip-off phone and web page set up by the Finnish police, which you can contact to give information on paedophile activity you have found on the network. When international material has been found, the police propose to tip off, in turn, the authorities in the countries concerned.
Finally, I would like to thank Mr Schmid for some excellent work in tackling this difficult subject on such a large scale.

Palacio Vallelersundi
Madam President, may I begin by congratulating the rapporteur not only on his excellent report but also on his absolutely brilliant speech. This is a very important subject, which is fundamental to our future as a society that protects both the rights of the individual and industrial development. But all this should not cause us to forget the fundamental issue that justifies our existence: our decisions must be rooted in the Treaty, the legal basis of our political acts.
My speech, therefore, will concentrate on the proposal put to us by the Committee on Legal Affairs, that the legal basis of the proposal for a decision be changed and that we use Article 129a relating to consumer protection, instead of Article 130 relating to the competitiveness of industry.
Madam President, there is no doubt that Article 130 tells us that measures will be taken to encourage an environment favourable to initiative and to the development of undertakings, and it is true that a better and safer environment will encourage industry. But it is no less true, Madam President, that it is very difficult to apply the objectives of Article 130, for example, that of establishing the necessary conditions to make Community industry competitive, to actions intended to warn consumers about the content, be it sex or violence, on the Internet by creating self-regulation systems and setting up filter mechanisms.
Having examined this proposal for a decision, therefore, the Committee on Legal Affairs has decided that the appropriate legal basis is Article 129a, which allows us to take this kind of action to encourage and protect a safe environment for consumers in general terms.
Madam President, I would also mention that this change of legal basis gives this Parliament more of a leading role in the whole of this action, because Article 129a provides for the codecision procedure, whereas Article 130(2) merely provides for consultation. And I think it is essential that on such a socially relevant and indeed burning issue this House should have a loud and strong voice, and not merely a consultative role.
Therefore, Madam President, I believe this is a subject that concerns all of us. The Treaty gives us a clear basis to participate with the Council on an equal footing, and we should try to see that this change of legal basis is reflected in the proposal.

Malerba
Madam President, I would first like to speak as the rapporteur for the document 'Initiative for international coordination of the Internet' in the Committee on Economic and Monetary Affairs and Industrial Policy. I agree with the European Commission's communication on the action plan for the safe use of the Internet, but I am not convinced that all the amendments which the rapporteur suggested making to the Commission's text are appropriate. Just this Monday, at the invitation of the European Commission, I participated in a panel discussion with the leaders of this world industry and a consensus was reached on three points Firstly, we must avoid setting up complicated rules that create conflicts between states and that are difficult to enforce, but we must also take a political initiative so that the courts do not have to issue rulings and set legal precedents. Secondly, we must promote a legislative framework which allows the Internet to develop, imposing self-discipline within the industry, together with involvement by the political authorities and the competent international organizations in a form of structured dialogue similar to the successful Transatlantic business dialogue. And finally, we must try to achieve an international consensus on a multilateral basis that includes, therefore, not only the United States and Europe but many other countries, in as global a context as possible.
While it might be obvious that there are areas where new codes must be written, for example, electronic signature specifically for use on the Internet, it is not obvious that new crimes will be committed on the Internet that have not already been invented and provided for in law. Rather, the Internet is an extraordinary means of communication that enables each individual to become a publisher, gives companies an instrument for the globalization of electronic trade and - I emphasize - makes it possible, if necessary, to trace all too well the origin and destination of transactions. I personally believe that we are faced with a young child that is taking its first steps and that we must help it grow in a favourable legislative context.
I have problems with certain amendments, Amendments Nos 6 and 12, on the authorities responsible for the content of the Internet, and Amendment No 7, on the responsibility of the distributors, but I am sure that we will come back to this debate with other thoughts and experiences.

Pinheiro
The Commission wishes to thank the rapporteur Mr Schmid and the Committee on Civil Liberties and Internal Affairs for a very positive report. The Internet is growing at a rapid pace and is no longer just used by scientists and researchers. Now it is part of everyday life in offices, homes and schools. It has proven to be extremely useful and important for business, education and culture. The vast majority of content poses absolutely no problem.
However, the Internet can be used for illegal activities and distribution of illegal contents. Parents and teachers are concerned at the availability of content which could be harmful for children. If the consumers and industry of Europe are to take full advantage of the opportunities offered by the information society, these issues must be addressed. Over the last year the Commission has worked hard with the Council, the European Parliament, Member States, industry and users to propose solutions. The action plan is the result of the response received when the Commission first addressed the problem and it has been developed in coordination with the Council recommendation on the protection of minors and human dignity.
The present action plan takes a non-regulatory approach, involves industry and proposes concrete measures to deal with the problems. It implements a political consensus and ensures the follow-up of actions already undertaken at EU level and in Member States. This approach has received strong support from the Bonn Conference, the Internet working party and the Council and European Parliament. The action plan has four action lines: first, creating a safe environment, including the creation of a European network of hotlines and support for self-regulation; second, developing, filtering and rating systems taking account of Europe's cultural and linguistic diversity; third, encouraging awareness actions; fourth, support measures.
Each of the action lines aims at reaching certain main objectives: to empower the user to protect himself and his family from undesirable harmful material; to strengthen reporting mechanisms for illegal material to be dealt with by existing legislation; to ensure that the specific multicultural and multilingual needs of Europe are addressed adequately; and to build trust in the new environment so that the consumer can benefit from the new services and so that industry can use the opportunities of electronic media.
The action plan is not the only means for achieving these objectives. It is a financial instrument that stimulates initiatives that must be addressed by Member States, the industry and users. It is not a legal instrument for solving the various legal issues connected with the Internet. However, many of the problems in the new environment do not call for new legislation. They calls for approaches where existing legislation can be applied to the Internet and how to provide sufficient solutions without legislation. Therefore, care has been taken to focus on the non-regulatory measures in this action plan.
Concerning the amendments, the Commission is able to support most amendments tabled by Parliament. In fact, 20 of 24 amendments tabled are wholly acceptable to the Commission. Regarding Amendment No 14 on comitology, I must point out that the Commission intends to use the exact wording of the 1987 Council decision on type 1 committees. There are, however, three amendments - Nos 7, 12 and 17 - which cannot be accepted. Two of them deal with legal issues and, in particular, liability. These certainly need to be addressed but the action plan, being a financial instrument, is not the place to do it. The Commission is, however, working on a legal instrument, a proposal for a directive, to deal with this subject.
The third amendment proposes the inclusion of labelling systems in industrial codes of conduct. The need to adopt labelling systems is already stated in the recommendations on protection of minors and human dignity. We can expect codes of conduct to be developed along the lines suggested in this report. I can assure you that if a separate European labelling system is needed, the action plan will certainly promote such a system. Nevertheless, if flexible international systems can be adapted and this proves to be convenient, there will be no need for a separate European system which could be a waste of money. However, there is no reason to believe that the concerns reflected in the suggested amendment are not already covered by the proposal.
I again thank Parliament for its work and its response so far. In line with this, now is the time to follow up on the initiatives of the European Union institutions. Parliament has already recognized the importance of dealing with these issues and I hope its decision will confirm the need for action by giving the action plan the full support needed to have a substantial effect.

President
Thank you very much, Commissioner.
The debate is closed.
The vote will take place tomorrow at 11.00 a.m.

Combined goods transport
President
The next item is the recommendation for second reading (A4-0239/98), on behalf of the Committee on Transport and Tourism, on the common position adopted by the Council with a view to adopting a Council Regulation concerning the granting of Community financial assistance for actions of an innovative nature to promote combined transport (C4-0173/98-96/0207(SYN)) (Rapporteur: Mr Ulrich Stockmann).

Stockmann
Madam President, ladies and gentlemen, you have just heard the full title of the regulation. Intermodality is the key concept of present and future European transport policy. It aims to create an overall transport system. By linking together various means of transport to create door-to-door transport chains, the advantages of each one are put to good use. Combined transport, which we are debating here today, is a tried and tested forerunner of intermodal goods transport. Combined transport has long been a keynote of our speeches, speeches by politicians concerned with transport, so that the rhetoric has far outstripped the reality. However, last year's statistics may mark a change in the trend here.
In addition to possible regulatory measures, at European level we have had the pilot actions for combined transport, PACT, since 1992. Following the success of the first programme, which expired in 1996, we have been working on PACT II since last year. The combination of the regulation and the increased, although still far from adequate, budget should now result in a proper programme, by which I mean one with a legal basis. The fact that we have not reached the second reading of the regulation until today very much reflects the birth pangs of the regulation, during which the Council showed itself to be a poor midwife.
Regarding the content of the regulation, we in the Committee on Transport and Tourism welcome the partial agreement of the Commission and the Council, particularly the inclusion of inland waterways and the reference to trans-European networks as a criterion for project selection. On the other hand, we consider the rejection, in the Council's common position, of some of the amendments which we originally tabled at first reading to be short-sighted, given that we need a strategic, and as I see it, forward-looking transport policy. The Committee on Transport has, therefore, confirmed the need for Amendments Nos 1 to 6 before us today. So what do we consider important here? Firstly, just as this has now become feasible for certain other programmes, we want PACT to be extended to candidate countries with which negotiations have already started, with a corresponding additional budget of ECU 4 million for the years 2000 and 2001.
A far higher level of funding for infrastructural measures for the central and eastern European countries was envisaged in Agenda 2000 for this period. We would like to see a small part of this earmarked now for combined transport. We are already witnessing an excessive increase in goods transport from the candidate countries. There is also a marked trend towards shifting goods from rail to road. This trend is generally irrevocable if it is not resisted early enough; we can tell you a thing or two about that in Germany's new Länder .
We cannot just stand by and watch changes like this. That is why we are calling for a strategic policy to be formulated at this point, and not a reactive policy that could cost us much more in ten years' time. Our second main concern is to establish synergies. A good programme can always be made better if it both aims at synergies with other programmes and it supports other policy objectives.
We still believe that synergies with the PHARE programme and projects under the Cohesion Fund should be possible. We consider that priority should be given to PACT projects in the catchment areas of freight freeways, which are politically desirable even if they are still hard to implement. Synergistic effects could also be achieved with activities planned under the Fifth Framework Programme on Research. This is the aim of a further amendment we have tabled.
At this point I would like to say a few words about Mr Jarzembowski's amendment, even though he is not here today. We have certainly not made things easy for ourselves with the reference to preventing competition, which initially sounds plausible or even self-evident. However, we finally decided to reject the amendment because we believe that any support programme inevitably implies positive discrimination, in this case away from transporting goods exclusively by road and towards combined transport, and also in favour of regions and competitors who give priority to combined transport. I would like to thank all my colleagues, including those who are absent today, who played a part in this report and I urge you to adopt it tomorrow.

Schierhuber
Madam President, Commissioner, ladies and gentlemen, I would firstly like to thank the rapporteur very sincerely for the excellent work he has done and to congratulate him on it. The Commission's proposal on support for combined transport takes account of the fact that the European Union needs a reliable trans-European transport system to guarantee efficient trade and also mobility. I therefore deeply regret that the Council has only accepted a small number of Parliament's proposals. This would be a perfect opportunity to act instead of just talking for once. As I have already said, I think it is a matter for regret that in its common position the Council has not seen fit also to give priority to projects which create links with the central and eastern European countries and thus achieve synergies.
Likewise, in selecting projects the Commission should try to strike a balance between regions and Member States, so as to avoid distortions in competition. Parliament accepted this point at first reading and it has now been confirmed in the amendment tabled by Mr Jarzembowski on behalf of the Group of the European People's Party. I urge the House to support this amendment too.
I would also like to mention that it is essential to integrate trans-European 'rail freight freeways' for the sake of environmentally sound development and to utilize trans-European transport networks. I see these freeways as a particularly important and innovatory aspect of the transport policy. Regrettable is not a strong enough word for the budget, which the Council has set at just ECU 35 million. Appropriations of at least ECU 43 million are required for the period from 1997 to 2001, if, as has already been said, we want action and not just words. A budget of this level should therefore be approved, even if I still think this is only a drop in the ocean.
I believe it is vital to develop the European Union's transport system, particularly in view of enlargement and the everincreasing significance of environmental issues. I therefore support the amendments tabled, as do all the Members of my group, and I hope that they will also enjoy the support of the House.

Wijsenbeek
Thank you very much, Madam President, particularly for giving me an opportunity not only to congratulate the rapporteur, but also to say that he is an excellent role model for people willing to retrain from being theologians or musicians to real technicians and politicians!
Let me now change over into my own language and say something on the report itself. In my opinion, we have here a typical example of how the Council could have shown for once through deeds, rather than just through words, how we, in this Parliament, as a body support the idea of a general shift from road to railways and inland waterways. We are once again here compelled to accept that we will have a major collapse in traffic before long if we do nothing. The responsibility for this lies with the Council and the Commission, not with Parliament.

Pinheiro
Madam President, let me first of all thank the rapporteur, Mr Stockmann and the House for the work on the proposals to continue our successful experience of pilot actions for combined transport, PACT.
It is a clear demonstration of Parliament's continuing commitment to promoting combined transport. While we appreciate the constructive attitude of Parliament in this dossier, I am sorry to say that the Commission will only be able to accept two of the amendments, although this should not detract from the broad agreement that exists between Parliament, Council and the Commission.
Amendments Nos 1 and 4 seek to introduce, as Parliament proposed in the first reading and the Commission agreed, the notion of the trans-European rail freight freeways into the regulations. Since the rail freight freeways are an important Commission initiative, I can continue to support their inclusion as an evaluation criterion in the PACT regulation.
The freeways are a significant step towards the true liberalization of the rail market. I can assure the House that both the Commission and the Member States will give high priority in the selection of procedures to any project that wants to make use of the freeways.
Amendments Nos 2, 3, 5 and 6 seek to reintroduce the possibility of funding actions outside the European Union and of allowing non-EC companies to be beneficiaries of PACT funding. The Commission is quite aware that combined transport policy cannot stop at the EC borders. Traffic flows and the opportunities for inter-modal transport are too important with our eastern neighbours. Therefore, the Commission proposal originally foresaw this possibility. However, discussions on this point in the Council have clearly shown that the regulation as such would not have a chance of being accepted by Council if the Commission insisted on this point.
Member States agree that the Community must help the candidate countries in their endeavours for a sustainable transport system. Many Member States thought that other instruments, for instance within the PHARE programme, should be used or further developed to assist combining transport services.
The Commission will, therefore, examine whether the current programmes can be used for PACT-like projects for inter-modal transport in the candidate countries. In the same vein, the Commission cannot accept the topping up to ECU 43 million because this sum conflicts with the financial perspectives of the Community for PACT.
Moreover, certain aspects of Amendments Nos 3 and 5 cannot be accepted; neither can we accept Amendment No 7. On the one hand, synergies with other funding programmes will be ensured through the necessary inter-service consultation within the Commission. On the other hand, the Commission continues to believe that the selection criteria, in simple terms, improvement of competitiveness, of combined transport through innovation are clear and limited in the interests of transparency. Other priorities or considerations could, we believe, only muddy the waters.
Even if I am not able to convince Parliament of the Commission's position in all respects, I hope I have at least clarified that position. Let me close by again thanking Parliament, and in particular the rapporteur, for the interest taken in combined transport and for the valuable contribution it has made concerning these regulations.

President
Thank you very much, Commissioner Pinheiro.
The debate is closed.
The vote will take place tomorrow at 11.00 a.m.
(The sitting was closed at 10.50 p.m.)

