Approval of the Minutes
President
The Minutes of yesterday's sitting have been distributed.
Are there any comments?

Smith
Mr President, concerning item No 10 on page 16 of the Minutes, Mr Novo raised the matter of the use of the bridge over rue Belliard to film a demonstration. The President said that he would reply in writing. It was a legitimate question and we are all entitled to hear the answer. If Parliament's premises are to be used by the goons and the ginks and the finks we are all entitled to know.

President
Perhaps the Minutes do not record the President's words accurately, Mr Smith. He asked Mr Novo to submit his observations to him in writing. Clearly, he could not give an immediate reply, and since he did not have direct knowledge of the events in question, he asked Mr Novo to make his point in writing, so that he could make the necessary inquiries and provide an answer as soon as possible.
(Parliament approved the Minutes)

Calendar of part-sessions
President
At its meeting of 13 June, the Conference of Presidents decided to propose the following calendar of part-sessions for 1997:
13 to 17 January; - 29 to 30 January; - 17 to 21 February; - 10 to 14 March; - 7 to 11 April; - 23 to 24 April; - 12 to 16 May; - 28 to 29 May; - 9 to 13 June; - 25 to 26 June; - 14 to 18 July; - 8 to 12 September; - 24 to 25 September; - 6 to 10 October; - 20 to 24 October; - 5 to 6 November; - 17 to 21 November; - 3 to 4 December; - 15 to 19 December.The deadline for tabling amendments to these dates is 5 p.m. on Wednesday, 3 July.
The vote will take place at 12 noon on Wednesday, 17 July.

Tomlinson
Mr President, am I correct in thinking you said that the deadline for tabling amendments would be Wednesday 3 July? That would be preposterous. It would be before we have a proper discussion in the main group meetings. You have to allow the full group meeting in the week before the plenary session so that groups can make decisions as to how they will vote. This is not the prerogative of four or five people sitting in a smoke-filled, or any other, room. The groups have to meet. I urge you to look at the deadline for amendments so that the proper full group meeting that is normally only held on a Wednesday afternoon and Thursday morning can take place and so that the Members of this House have some say in how and where they meet.

President
Thank you, Mr Tomlinson. The President set this deadline precisely so that the political groups would be able to discuss the calendar beforehand. In any event, I shall pass on your comments to the President. There is another meeting of the Conference of Presidents this Thursday, and the group chairmen will thus have an opportunity to discuss the deadline and change it if necessary.

Decision on urgency
President
Mr Santini has the floor to give the opinion of the Committee on Agriculture as the committee responsible.

Santini
Mr President, since Mr Jacob, the chairman of the committee is not here, I wish to express in his place the view of the Committee on Agriculture and Rural Development, that is to say the decision we have taken not to agree to urgency on this matter.
(Parliament rejected the request for urgent procedure)

Müller
Mr President, I would formally request the House to agree to urgent procedure. We have fallen badly behind with our emergency aid for Bosnia-Herzegovina. I was there with other Members a fortnight ago, and we were able to see that the emergency aid of ECU 92 million cannot be put into effect because of the lack of a legal basis. Please do not make the people in Bosnia-Herzegovina, who desperately need this money, pay the price of the disagreement over the legal basis. If we do not agree to urgent procedure, it will take longer still for this money even to reach the start of the administrative process. I would implore you to vote in favour of urgent procedure in this case.

Giansily
Mr President, we shall be looking at the question of finance tomorrow afternoon, and I hope that we can take the vote on Thursday, because the Committee on Budgets adopted that report unanimously yesterday evening. So I do not see how urgency will make any difference as far as the report on the regulation is concerned.
We would prefer to keep to the planned timetable, in other words to have the vote on the Committee on Budgets' report on Thursday and the debate on the report on the regulation in due course.

Cars
Mr President, with reference to the alarming situation in Bosnia, agreement was reached in January of this year at a tripartite meeting of Parliament, the Council and the Commission on guidelines for the budget concerned. Most of the appropriations are to be used for the procurement of goods for the reconstruction of Bosnia-Herzegovina. In other words, thanks to Parliament's decision in January to approve disbursement, EU aid is already a reality in the region and continues to flow in. The legal formalities surrounding this aid do not therefore need to be dealt with as a matter of urgency.
Secondly, Mr President, the Commission and the Council have taken six months before deciding they wanted to seek Parliament's views on these legal issues. If Parliament now takes one month it can hardly be regarded as unreasonably dilatory.
Thirdly, however, Mr President, we in the European Parliament have objections to the procedure proposed by the Council. The Council decided on the regulation at its meeting of 10 June 1996 in Luxembourg, when it also amended the Commission's proposal. Now Parliament is being consulted on an issue on which the Council has already adopted a standpoint. I do not wish to rule out the possibility that Parliament will request negotiations with the Council once it has given its opinion in July. In any event, Mr President, we should today reject the proposal from the Council for a special urgent debate on this subject.

President
Thank you, Mr Cars. We have heard one speaker in favour and one against, and Mr Cars has spoken on behalf of the Committee on Foreign Affairs.
I now put the request for urgency to the vote.
(Parliament rejected the request for urgent procedure)

EMI annual report - Currency fluctuations and the internal market -
Exchange rate relations- Broad guidelines of economic policies
President
The next item is the joint debate on:
the report (A4-0180/96) by Mr Gasòliba i Böhm, on behalf of the Committee on Economic and Monetary Affairs and Industrial Policy, on the second annual report of the European Monetary Institute (C4-0228/96); -the report (A4-0181/96) by Mr Pérez Royo, on behalf of the Committee on Economic and Monetary Affairs and Industrial Policy, on the communication from the Commission (COM(95)0503 - C4-0011/96) on the impact of currency fluctuations on the internal market; -the report (A4-0186/96) by Mr von Wogau, on behalf of the Committee on Economic and Monetary Affairs and Industrial Policy, on the interim report by the Commission to the European Council (CSE(95)2108 - C4-0308/96) on the exchange rate relations between the Member States taking part in the third stage of Economic and Monetary Union and the remaining Member States; -the oral question (B4-0561/96-0-0126/96) by Mr Cassidy, on behalf of the Committee on Economic and Monetary Affairs and Industrial Policy, to the Council, on the recommendation on the broad guidelines of the economic policies; -the oral question (B4-0567/96-0-0130/96) by Mr Hughes, on behalf of the Committee on Social Affairs and Employment, to the Commission, on broad guidelines of the economic policies.
Lamfalussy
Mr President, ladies and gentlemen, I shall be very brief. I do not intend to outline the report by the European Monetary Institute, but simply to comment on three rather important points which it raises.
First of all, there is the work done by the Institute since the end of last year, which I am pleased to be able to tell you has gone according to schedule. In other words, we are still on course to complete the structure for the future European Central Bank, and we have not encountered any serious delays. There is therefore every reason to believe that the Bank will indeed be able to get the single currency up and running in 1999. This was the first point I wished to make.
Secondly, there is the analysis of the economic situation which we give in the report. There have been no significant changes since the report was drawn up. Of course, we are all concerned about current economic developments, and we are all wondering, individually and collectively, how likely it is that we shall see signs of a recovery in the course of this year. In my personal opinion it is extremely likely, and I expect to see a recovery in the second half of the year, though I cannot predict how strong it will be. But whatever doubts there may be at the moment about its scale and strength, it is growing increasingly likely that it will happen.
Thirdly, there is the process of convergence, which the report covers in some detail. I am pleased to say that further progress has been made on convergence on inflation, interest rates and the stabilization of exchange rates, and we are certainly heading in the right direction. Our budgetary concerns are, of course, the same as they were when the report was drawn up, but it is encouraging to see that the analyses carried out in the various countries and the budget plans announced by the governments are converging too.
I think that each and every country is fully aware of the scale of the problems confronting us, with or without Maastricht. So the fact that our thinking, analyses and determination to find a solution to these problems are all converging is of crucial importance, and is essential if the government policies which are currently being put in place are to succeed. We will have a clearer picture towards the end of the year, once we have seen the budget forecasts for next year.
These were the comments I wished to make to accompany our annual report.

Gasòliba i Böhm
Mr President, ladies and gentlemen, the second Annual Report of the European Monetary Institute contains an adequate analysis of the progress made by the Union's economies in the process of economic and monetary convergence, as well as a detailed description of the preparatory work for the third stage of economic and monetary union, with particular emphasis being placed on the report on the changeover to the single currency which formed the basis of the European Council's decision of December 1995, the agreement on the interconnection in real time of gross settlement systems - the 'Target' system - and the coordination of the instruments of monetary policy.
There are still far too many question marks over the final outcome of this process, in which the European Monetary Institute plays a fundamental role. Despite the fact that six months ago, at the Madrid summit, the Heads of State or Government of the Member States firmly reiterated their commitment to achieving economic and monetary union and introducing the single currency, certain statements made in political, economic and financial circles have been casting doubts on whether these objectives are entirely viable.
As Mr Lamfalussy said, the process of economic convergence is meeting with success in three respects: inflation, interest rates and exchange-rate stability. Furthermore, we have sound and competitive economies, as is demonstrated by the positive development of the European Union's balance of trade. Nevertheless, the hoped-for economic recovery - which six months ago, the European Commission was calling robust - has failed to materialize. We are in a period of uncertainty, of economic sluggishness - there was even a slight recession in the first quarter of the year - which can only be explained by the lack of consumer and investor confidence brought about respectively by the high level of unemployment and the necessary budgetary cutbacks, all of which is preventing the economic upturn from occurring.
However, as is also stated in the EMI's report, there is a clear need to reduce public deficits and debts substantially. In my view, therefore, the only course is for the Community institutions - and especially the Council - to give a clear and resolute signal that the process of economic and monetary union, as set out in the Maastricht Treaty, is irreversible. Consequently, it is essential for economic operators to be provided with adequate guarantees that enable them to give a boost to the kind of economic activity in which investment plays a key role in both promoting the recovery and ensuring that the European economy is sufficiently competitive in the medium term.
In this context, the report by the Committee on Economic and Monetary Affairs and Industrial Policy stresses the need to enhance the role and the capacities of the EMI, especially in view of the fact that 1996 is a decisive year for economic and monetary union, since according to Article 109f of the Maastricht Treaty, the EMI must specify by 31 December the regulatory, organizational and logistical framework necessary for the European System of Central Banks to perform its tasks in the final stage of EMU. We believe that in its activities hitherto, the EMI has been excessively reserved and restrained. Our committee takes the view that the EMI should adopt a firmer and more resolute approach, enabling it to play a more active role in the coordination of the Member States' monetary policies and to establish flexible working relationships with the international financial institutions, in particular the International Monetary Fund. Also, the committee gives its backing to the proposal that the EMI should be rigorous in the application of Articles 104 and 104a of the Maastricht Treaty, which prohibit monetary financing and privileged access - cases of which have occurred, albeit on a small scale, and which must be eliminated completely.
Our committee also stresses the need for the adjustment of internal control mechanisms, with the introduction of new and effective procedures aimed at preventing the kind of distortions which occurred in connection with financial derivatives. Finally, it is calling for the European Monetary Institute's activities to be extended to more operational fields, in view of the timetable and objectives entrusted to the EMI, which is a key player - and, we would wish, a more active one - in the process of preparing for economic and monetary union and the single currency.

Pérez Royo
Mr President, ladies and gentlemen, the report which I have the honour of presenting to the House today concerns the monetary fluctuations which occurred during 1992 and 1993 - and indeed 1995 - and which, as we know, had a significant impact on the functioning of the European exchange-rate mechanism and the internal market itself, leading first and foremost to changes in competitiveness in favour of those currencies which suffered depreciations.
Secondly, it should be remembered that as a result of these monetary fluctuations or upheavals, two currencies left the European Monetary System in 1992. The EMS was itself modified in 1993, with the broadening of the fluctuation bands. Above all, however, the distorting effects on the internal market caused by the uncertainty and insecurity in the markets resulting from these fluctuations should be underlined.
The main concern of our report is not so much to produce a balance sheet of winners and losers as a result of these fluctuations, but to draw the lessons from the past which must be taken into account in the future, especially when it comes to defining the relationship between the euro and the currencies which temporarily remain outside EMU.
As far as the causes of the fluctuations are concerned, we must focus principally on the inadequate coordination of the economic policies of the Member States, whose economies, prior to 1992, displayed very different patterns of behaviour as regards inflation, budget deficits and interest rates. This situation contrasted with the stability of nominal exchange rates, which progressively diverged from real exchange rates, giving rise to the corrective action of the markets, which was also encouraged by the lack of flexibility of the EMS which existed at the time.
With regard to the effects of the fluctuations, we agree with the Commission communication that they were not particularly noticeable at macro-economic level, neither in terms of the volume of external trade of the countries affected, nor the increase in market share. On the whole, the effects were mainly felt at sectoral level, with a reduction in the profit margins of undertakings in countries whose currencies appreciated.
In any event, we would stress that the principal damaging effects were those caused to the smooth and effective functioning of the internal market. This was especially due to the fact that the fluctuations of European currencies were accompanied by fluctuations of the dollar and yen, underlining Europe's need for a single currency - the euro - capable of functioning autonomously as a reserve currency at international level and offsetting the fluctuations of these and other currencies.
I should also like to draw attention to the fact that in recent years - those of the second stage of EMU, the current stage in the process - there has been an improvement in the coordination of the economies of the Fifteen, which have made progress towards convergence. This progress has been underpinned by the behaviour of the markets, which appear to be demonstrating their confidence that the timetable for economic and monetary union will be met.
Since 1993, the European Monetary System has functioned satisfactorily. Despite the broadening of the fluctuation bands, the currencies which form part of the EMS have been moving within reduced margins which correspond to the narrow bands in force before the summer of 1993. This very week, if we examine the EMS grid, we can see that the difference in parities between the strongest and weakest currencies is less than 2 %. And this has been the case continuously now for several months.
In this context, the report recommends that an explicit call should be made for those currencies at present outside the European Monetary System, both those which left it in 1993 and those of the new Member States - which, with the exception of Austria, have not yet joined the EMS, to be integrated into it as soon as possible. And, in this respect, we must welcome the rumours - because at present they are no more than rumours - of the imminent return of the lira to the EMS, as well as the entry of the Finnish mark.
Looking towards the future, it is important to stress the need to strengthen the mechanisms for coordinating economic policies at European level; and it could even be argued that the ECOFIN Council should progressively become a kind of economic government of the Union.
Finally, I should like to make a few brief comments concerning the relationship between the 'ins' and the 'outs' - between the euro and the currencies which remain outside EMU. This issue is the subject of the report which will be introduced next, so I shall deal with it very quickly. There is a broad consensus on the need for a system which has the euro as a pivot, in relation to which the currencies which remain temporarily outside EMU would float within bands of an agreed width. This system would be complemented by a practice of inflation targeting approved jointly by the European Central Bank and the central banks of the countries outside EMU.

von Wogau
Mr President, ladies and gentlemen, the third stage of economic and monetary union will begin with the establishment of the European Central Bank on 1 January 1999. However, it is probable that not all the Member States will participate, because they are either unwilling or unable to do so. This means in effect that monetary union will be achieved at various speeds, and we must ask ourselves the question: is this in fact compatible with the Treaty of Rome?
For Denmark and the United Kingdom, the relevant protocols to the Treaty make explicit reference to the socalled 'opting in' and 'opting out' . It is fairly certain that one of these countries, and possibly both, will make use of this opportunity. Thus the Treaty itself makes provision for a two-speed Europe. Other countries will initially remain outside because they cannot yet meet the stability criteria.
I would remind the House on this point that the criteria were decided jointly by all the Member States, and then ratified by all the national parliaments without exception. We must abide by these criteria as stipulated in the Treaty; they must not be relaxed. But nor should any further conditions be laid down before the entry into force of monetary union.
It would of course be preferable for all the Member States of the European Union to accede to the monetary union simultaneously, but that could only happen at the expense of stability. The Maastricht Treaty sets out the priorities unequivocally: the stability of the common European currency is more important than its simultaneous introduction in all the Member States.
But will not a variable-speed monetary union jeopardize the smooth functioning of the European single market, one of our major achievements? I would refer here to the exchange-rate turbulence experienced in recent years. Since 1993, competitive devaluations have caused numerous jobs in the European Union to be put at risk, and even lost. Unless stability in the exchange rate between the euro and the other currencies of the Union can be maintained, there will be a danger that the European single market could break up, even after the transition to monetary union, in other words even after 1 January 1999.
What instruments do we have to prevent this? The prerequisite for exchange-rate stability is that all the EU Member States should operate credible and sound financial, economic and monetary policies. In addition, the existing exchange-rate system should be retained in a modified form. However, when the new exchange-rate system comes to be designed, with the euro as its anchor currency, account must be taken of the experience gained with the EMS. The new system must demonstrate greater simplicity, transparency and flexibility than its predecessor.
Flexibility is the key: the new exchange-rate system must be more flexible than the previous one. Any necessary exchange-rate adjustments between the euro and the other currencies must be geared to the realities of exchange relations, and they must be made in good time. A major weakness of the 'old' EMS was that it was up to the Member States involved to initiate the process for adjusting exchange rates. Time after time, this resulted in delays for political reasons, leading to adjustments being made under chaotic conditions; such difficulties must be avoided with the new system. We therefore support the proposal that the right of setting the adjustment mechanism in motion should be granted to the President of the European Central Bank. What is more, the system must have fairly broad margins of fluctuation, to be set by mutual agreement.
Member States wishing to do so could choose to have closer links with the euro, as they make progress towards meeting the stability criteria. Intervention measures in support of currencies experiencing difficulties should be automatic when a currency reaches its fluctuation margin and possible before it does so, provided that such measures are justified by fundamental economic factors, and that their volume does not run counter to the objective of achieving price stability.
In my personal view, this new exchange-rate system will still function even if the United Kingdom declines to participate. The UK only participated for a short while in the present exchange-rate system: its lengthy absence brought no significant disadvantages, and nor did its brief participation lead to significant gains in efficiency for the system. It should be borne in mind, however, that under the Treaty, exchange-rate policy is a matter of common interest. The UK is therefore obliged to keep the rate of the pound stable against the euro; whether that happens within or outside the exchange-rate system is a secondary issue. However, if the UK were to join the system, the exchange rate on entry would this time - unlike last time - have to be set by agreement with the other EU Member States.
Finally, I would just comment briefly on stability policy after the transition to monetary union. Global public sector debt in Europe remains too high, and this works to the detriment of competitiveness and of the younger generation. We are therefore awaiting clear proposals from the Commission on how budgetary discipline can be maintained after the entry into force of monetary union. Clearly, however, the objective must be that ultimately all the Member States of the European Union will also be members of the monetary union.
1999 will be the decisive date for the central banks. The decisive date for the citizens of Europe will not come until the year 2002, when banknotes and coins in the new currency are to be introduced. If all the EU Member States pursue their convergence policies with determination, I am confident that by the second date, which is more relevant to the citizens themselves, a large majority of the Member States will be on board.

Cassidy
Mr President, it is not in any sense part of my job this morning to answer comments made by previous speakers. However, just in parenthesis, I will make the point, following on what my colleague, Karl von Wogau, has just said, that the question of the United Kingdom's relationships with the European Monetary System and exchange rates is, of course, one for markets and not for governments. But that is a matter which I am sure we will discuss endlessly in the coming months.
I speak this morning as the rapporteur on the annual economic report and part of the responsibilities that go with that rapporteurship is producing a report on the broad economic guidelines.
My first suggestion, addressed to the Commission - and I promise the Commission that this will be my last criticism of it - is that it would be most helpful in future if the Commission could contrive to produce its annual economic report and its broad economic guidelines in sufficient time for the Committee on Economic and Monetary Affairs and Industrial Policy and the Committee on Social Affairs and Employment because these two projects are the joint responsibility of those two committees. It would be helpful in future years if we could have the broad economic guidelines a bit earlier, because the trouble this time is that we have had to rush to conclusions because of the deadline at the end of this week of the 21 and 22 June meeting in Florence. This has meant that we have not really had time in the Economic Committee to produce a report debated in committee, adopt amendments in committee and then present to this House a report that is properly balanced in the way in which the three previous reports are balanced and reflect consensus in the committee.
The compromise resolution, which we shall be voting on later today, is therefore unsatisfactory in some respects, but that is an inevitable part of having a compromise. Compromises, by definition, do not satisfy everyone and we would say that the joint resolution is all right up to a point but we shall be tabling a number of amendments to it. One is to remove the Commission from the line of fire of criticism, because you will have noticed that our resolution is somewhat critical of both the Commission and the Council. But we believe that at this stage it is too late to criticize the Commission.
We shall also be tabling amendments on matters which we feel very strongly about and which, indeed, are in our question to the Council, because at the moment there is no reference in the final resolution to the need for the Member States to analyse the best practice in Member States and, in parenthesis, the United States, in order to identify the policies which can achieve results in bringing down unemployment rapidly. This is something which the committee as a whole felt strongly about in the resolution on the annual economic report and it is a significant omission that it is not in the resolution to wind up this debate. I hope that the House will agree to incorporate this point and that the House will also agree to the addition that the Member States should create an environment where employers are encouraged to take on workers. It is not part of my job to anticipate what the speakers on behalf of the Social Affairs Committee may say on that matter, but it is very clear, with the high level of unemployment in the European Union, that it is unacceptable that there should be something like 18 million unemployed in our society, with 50 million living in poverty or in near poverty.
Coming to the substance of what the debate this morning is all about, this is actually the European Parliament's opportunity to put forward its views to the European Council which meets in Florence at the end of this week. You will find in our resolution something to the effect that our President should take this resolution to Florence.
The other important point is paragraph 11 of our resolution which calls upon the Irish presidency to report very quickly back to this House on what action is going to be taken by the Member States on the broad economic guidelines. I do not know whether there is a representative of the Irish presidency here but, if not, perhaps the representative of the Italian presidency would be kind enough to pass on that message and a copy of our resolution.

Wolf
Mr President, ladies and gentlemen, I think we are moving towards an important decision. The House is likely, by a large majority, to reject as unrealistic and inadequate the broad economic guidelines presented by the Council. That is very important, and it is also very important that we should do so by a large majority. I agree with Mr Cassidy that we can no longer accept economic growth which is such that employment levels continue to decline. I would, however, like to discuss with him in more detail what he means by encouraging employers to take on workers. I believe that a very specific form of encouragement is required in the case of companies which are now able to earn far more from currency speculation than they can through genuine economic activity. We need a change of direction here.
As a Parliament - and here too I turn to Mr Cassidy - we have taken a joint decision in many areas that it is high time to put an end to the superficial strategy of pretending that all is well and there are no structural problems; these problems need to be resolved as a matter of urgency.
Parliament has asked a number of questions which the Commission has taken up in part, very tentatively, and which the Council has not even acknowledged. It is therefore the duty of the House to reject these guidelines, not merely for reasons of parliamentary etiquette, but because it is central to our task as a Parliament to tackle the mass unemployment and mass poverty which have become the real scandal of the European Community. I would assume that a large majority of us will address ourselves to this task.
Because of the speed of the procedure, and not any fundamental disagreement with the Committee on Economic and Monetary Affairs and Industrial Policy, the Committee on Social Affairs and Employment has asked the Commission a number of supplementary questions. This is not because we think that the Commission is the main culprit in this situation, so to speak - rather, the guilt lies chiefly with the Council and the Member States. However, the Commission too could do more, and we are therefore asking what initiatives it plans to take to bring about the necessary change in economic policy. We are asking about the implementation of our priority of combating mass unemployment effectively, because we cannot expect the citizens of Europe to tolerate another outpouring of meaningless fine words. We are also asking in particular about additional Commission measures to send a strong signal to the markets and help revive the economy. We are asking for the much-trumpeted initiative of a European pact on employment to be presented at long last. We are asking what efforts the Commission plans to make to redress the balance between fiscal and employment policies in the multiannual programmes submitted by the Member States. We are asking how the Commission is going to devise and apply common socio-economic indicators which make it possible for a binding debate to take place on the coordination of economic policy, no longer geared solely towards a monetarist approach to national debt. And we are asking for greater coordination between economic and employment policies.
The decision which we have to take today is not a trivial one. The real issue is the point in time when the European Community becomes relevant to every individual in this Community. It is a matter of making it clear at last that our Community is one which has set its sights on genuine improvements in the welfare of its citizens, and which is not solely determined to push through a narrow monetarist view of stability policy and a technocratically agreed timeframe and strategy for the introduction of monetary union, at the expense of millions of impoverished and unemployed people.
I hope we shall decide by a large majority that this cannot go on. I also hope that this will be the first impulse for real change. Unfortunately, the House does not yet have the power to force a change, but the governments would be well advised to react now, because otherwise the problems will seek out new governments.

Macciotta
Mr President, you said, when you spoke at the meeting held in Luxembourg on the Council's current economic policy strategy, that although the economic fundamentals were favourable, the Community's overall results were not yet satisfactory. That does not, however, mean that the strategy itself is called into question: progress has been made more difficult as a result of the slow-down in activity over the past twelve months but the current strategy needs to be continued and reinforced. The Council expects the positive impact of the action taken by the Member States in response to the maximum guidelines to become more perceptible as time goes on, with an improvement in economic conditions. The Council therefore confirms the need to continue with the balance-of-payments adjustment and control of inflation, in accordance with the provisions of the Treaty, and stresses the importance of achieving a stable and appropriate macro-economic policy framework as the pre-condition for increasing growth and reducing the level of unemployment.
The Council unanimously confirms the need to implement this policy combination, as these are policies which have the backing of the other Community Institutions, the Commission and the European Monetary Institute. Consolidation of the process of adjustment, in its current form, is the way to create a macro-economic framework which increases growth and creates jobs. That, naturally, presupposes in particular that further progress will be made in reducing government deficits and implementing stability-oriented monetary policies and trends in salaries and wages that are consistent with the objective of price stability and increased productivity.
If that very ambitious objective is achieved, we shall be able, in the medium if not in the short term, to create the macro-economic circumstances needed to improve the Community's negative record on unemployment, by cutting interest rates.
As far as structural measures are concerned, the maximum guidelines provide us with a useful set of policy recommendations that have to be implemented under the responsibility of each Member State, enabling us to banish the rigidity that currently affects the labour market by, for example, reforming the social welfare system to guarantee efficiency and fairness between the generations in the current systems; introducing improvements into the education and vocational training system so that priority is given to employment for the less qualified, young people and women; reducing indirect wage costs; encouraging, where appropriate, regional and intersectoral mobility; and reviewing working hours and the organization of work. Increasing employment is the main priority, and the Council is trying to identify those experiments which have been successful in the different Member States in improving the employment strategies of those same States. That will be one of the focal points of the annual report on employment at the Dublin European Council, and, naturally, as Mr Cassidy has requested, the Italian presidency will pass on your requests to the Irish presidency. I can assure you that the convergence programmes are the focal point of the Council's multilateral monitoring procedure. The aim of those programmes is to secure the convergence required for participation in the single currency area and they are important in themselves because they are designed to bring about sustainable and non-inflationary growth.
The Treaty itself establishes a useful range of procedures - maximum economic guidelines, convergence programmes and procedures covering excessive deficits - in order to secure effective coordination. This will be further improved as a result of the process which will bring into effect the third phase of European Monetary Union. The maximum guidelines for economic policy, as well as the procedures relating to excessive deficits will, of course, become more rigorous in the context of Monetary Union.
As far as the objective of sound public finances is concerned, some limited progress has already been achieved in the last year. The excessive deficit procedure is an effective means of encouraging the efforts of Member States towards consolidation; the concept of countercyclical policy, taken up by Mr Cassidy, is difficult to apply in the context of an open economy, but it is certain that achievement of the fundamental objectives of economic policy, as set out in Article 2 of the Treaty, in particular non-inflationary, stable growth which respects the environment and secures a high level of employment, depends on effective and close coordination between the Member States. If we are to increase growth and, therefore, levels of employment, there have to be measures designed to improve the operation of the markets, services and products. In its plan for the maximum economic policy guidelines of the Community and the Member States, the Council points out that, as far as the improved operation of the markets is concerned, the individual Member States very largely possess the key to this. The Council, however, appreciates that national measures can be reinforced via the guidelines at Community level.
The problem of increasing levels of unemployment is the main crisis area in a Europe caught between two requirements: the need to reposition its own economic and productive structures generally and the need to safeguard those fundamental social achievements that constitute the distinctive feature of Europe's cultural tradition built up over the passage of time. If we are to do that, we need to attach less importance to the role of financial returns and concentrate resources on productive uses. Since our approach cannot be to restrict the social rights of workers in an effort to increase Community competitiveness, we shall have rapidly to adopt measures designed to encourage innovation. The Commission's Green Paper on innovation makes a very useful contribution to the debate on competitiveness and deserves to be looked at closely in terms of how it can be applied at both national and Community level. The Council will be very interested to take part in and contribute to the forthcoming discussions designed to devise specific measures.
At its meeting of 3 June, the ECOFIN Council achieved some important progress in the field of economic and monetary policy that we are discussing here today. Let me just summarize the main issues: as regards preparation for the third phase of Economic and Monetary Union, the Florence European Council will reaffirm that it intends to conclude by the end of the year the technical preparatory work on the legal framework to be used for the euro; the Council has concluded that it would be helpful to consider in parallel the problems of exchange rate parities and budgetary discipline; it has also stressed that, regardless of whether or not they adopt the euro, it is of great concern to all the Member States that Economic and Monetary Union should function properly and that there should be an exchange rate parity mechanism which provides a point of reference for the application of sound economic policies.
Membership of the new system of exchange rate parities would continue, in the Council's view, to be optional; however, provision can be made for those Member States given an exemption to join the mechanism. The Council has suggested that, like the earlier systems, the new system will be set up on the basis of a European Council resolution and become operational following an agreement between the European Central Bank and the central banks of those Member States that have not joined the euro area. The Council stated that it favoured an asymmetric system in which the euro acts as an anchor. The new system would be designed in such a way as to permit various levels of convergence of the Member States.
Turning, finally, to budgetary discipline in the third phase, the Council has asked all of the Member States to aim in the medium term for a budgetary position that is close to equilibrium or in credit. That should allow the automatic stabilizers to operate throughout the whole of the economic cycle. The Council, finally, has proposed strengthening the procedure concerning excessive government deficits under Article 104c. It takes the view that it will be necessary to set rigid time-limits, based on the assumption that the Council will impose pre-set and proportionate penalties in cases where excessive deficit persist.

de Silguy
Mr President, ladies and gentlemen, the Commission is delighted that the House has decided to focus on economic and monetary union this week.
At this time, in the run-up to the Florence European Council, the Commission feels it is important to restate our clear commitment to the approach we have adopted up to now in pursuing a stable and healthy macroeconomic policy which enables us to take determined and coordinated measures to combat unemployment, while at the same time keeping the preparations for the third phase of EMU on schedule.
First of all, improvements to the macro-economic situation. There is no alternative to the Commission's recommended policy of reducing public deficits in order to create jobs. This year, the Commission has two new recommendations: first, that the policy mix should be made more flexible over the long term. The Commission has established the broad economic policy guidelines on the basis of Article 105(1) of the Treaty, and the macro-economic policy it recommends should help towards achieving the objectives of the European Union as laid down in Article 2 of the Treaty, namely growth, employment and stability. We cannot hope for a substantial reduction in unemployment without strong, sustained medium-term growth supported by growth in investment. So as far as the Commission is concerned, we must make credible budgetary improvements, but as well as the quantitative reductions in public deficits, we also need to redirect public spending towards productive areas such as investment in infrastructure, human resources and an active employment policy.
The social effects of budgetary consolidation also need to be carefully balanced, and wage increases should be kept at suitable levels. Instead of increasing overall fiscal pressure, the Commission recommends that increases in spending should be curbed and tax structures modified to reduce the tax burden on labour. This will enable the policy mix to be relaxed still further, making it possible to create monetary conditions that are likely to keep interest rates down.
Secondly, the structural measures taken to promote employment should be better coordinated. The pact on employment gives the Commission the tools it needs to implement the 1993 White Paper on growth, competitiveness and employment and the conclusions of the Essen European Council in this field. The pact is a collective initiative which spells out the various commitments undertaken by the public authorities and the social partners as part of an overall coordinated strategy.
As you can see, the Commission is following its own recommendations in trying to make unemployment a matter of common interest. But the broad economic policy guidelines are also a vital instrument in our progress towards economic and monetary union, and must be applied to the letter. Article 103 of the Treaty states that Member States must coordinate their economic policies as a matter of common concern, and this is why the Commission recommends that updated national convergence programmes should be developed this year. The programmes must make it clear how the convergence measures adopted pursue the general aim of strengthening growth and improving employment. If economic policy is to be better coordinated at Community level, the national programmes must represent a much firmer statement of political commitment, and the Commission asks that they should be approved as such by the Council.
The broad economic policy guidelines may be an effective and coherent method of achieving economic and monetary union, but transition to the third phase also depends on the achievement of monetary stability throughout the Union.
The reports by Mr Pérez Royo and Mr von Wogau are an important contribution to the work the Commission is doing on monetary stability and the need to avoid splitting Europe in two when the euro is adopted.
The Commission notes with satisfaction that your rapporteur confirms the analysis of the impact of currency fluctuations which it presented to the European Council in Madrid. Currency fluctuations are damaging to the single market, but at the same time we must not allow the market to be jeopardized by the introduction of protectionist measures.
The Commission is determined to remain vigilant, and as you have requested, we will keep a close eye on the impact of currency fluctuations by regularly monitoring the economic indicators. As your rapporteur himself recommends, the solution is to be found in closer convergence, particularly in the area of public deficits, and the introduction of the euro.
On the subject of relations between the 'ins' and the 'pre-ins' , in accordance with the instructions of the Madrid European Council, the Commission and the European Monetary Institute are working hard to set up a new monetary system between the countries participating in the euro and those not participating at the outset. The report by Mr von Wogau will make a useful contribution to the work which the ECOFIN Council has been doing on this subject since Verona, work which I would point out has involved a broad degree of consensus.
The Commission feels that this new system should both guarantee monetary stability in the Union in the transitional phase, while at the same time keeping the door to the euro open for those countries which are 'preins' . But we cannot have lasting monetary stability without convergence, and this is why there will be stronger convergence procedures running alongside the exchange-rate mechanism. However, if it is to be entirely credible, the new system must also be flexible enough to accommodate the various levels of convergence between the different countries. Although anchored to the euro, it will still have to have fairly broad fluctuation margins, with compulsory intervention within these margins, as well as credit facilities. As many Member States as possible will need to participate if the new system is to operate smoothly, and it will be in their interests to do so, since it will be to the advantage of all the Member States to join the economic and monetary union as soon as possible.
The new system will also open the door to the euro, and the conditions of entry will be the same for the countries which are 'pre-ins' as they are now for the countries which are 'ins' . The 'pre-ins' should join as quickly as possible, an idea which your rapporteur obviously supports when he asks the Commission to design new instruments to strengthen convergence and accelerate the process of integration. It is for this purpose that the Commission is currently examining ways of improving the present convergence programmes, which have proved that they are effective and will remain at the hub of the system.
In conclusion, I should like once again to underline the Commission's commitment to a coherent approach. Only by pursuing a healthy and stable macro-economic policy can we restore confidence and stimulate growth. The broad guidelines were adopted unanimously by all the Member States at the last ECOFIN Council. It is vital to maintain the overall dynamics of this policy by developing the necessary structural policies for promoting employment in Europe. All the preparatory work must be completed at least one year before the decision is taken to enter the third phase, so the European Council needs to decide how the new monetary system and the stability pact are to work and what legal status the euro is to have.
Economic and monetary union is a comprehensive project which will be concluded under the conditions and timetable set out in the Treaty.

Donnelly, Alan
Mr President, I should like to thank the Council and the Commission for their presentations this morning. I shall concentrate on the broad economic guidelines. The Socialist Group firmly rejects the guidelines adopted by the ECOFIN Council recently and we are deeply unhappy with the approach taken by the Commission regarding the economic prospects for the European Union.
The first point is to look at the economic fundamentals which the Commission claims are favourable. We have historically high levels of unemployment. Some 50 million people in the European Union are suffering social exclusion and poverty. Internal demand in the EU is depressed because of the attack on social protection and jobs. Real wages are stagnant. Business confidence fell again last month for the seventeenth month in a row and there is a collapse of consumer confidence. Public investment has fallen over the last ten years from 3.5 % of GDP to 2.5 %.
If the Commission and the Council claim these are favourable economic fundamentals I would like to see the statistics they are basing this on. Clearly Europe is in crisis and we need coordinated measures by the Commission and ECOFIN to try to bring Europe out of that crisis. The growth rate this year is 1.5 %, which I imagine will be estimated as even lower by the end of the year. There may be a growth rate of 2 or 2.5 % next year. It is completely insufficient.
That is why we have produced a very critical report on these guidelines. In particular, I want to refer to the guidelines as approved by the Council. Mr De Silguy did not refer to the way in which the guidelines were changed by the Council and I should like the Council and Mr De Silguy to deal specifically with the changes that have been made to those guidelines by the ECOFIN Council. I hope the Council is listening carefully to this. There are ten cases where the Council has deleted points from the Commission's guidelines, which Parliament was already unhappy with.
Why did the Council delete the reference to a better economic policy mix more favourable to growth? The ECOFIN Council deleted this. I want to know why. The reference to the European Parliament's opinion on the economic annual report was deleted by ECOFIN. Why did it delete that? A durable detente in macro-economic policy is essential to relaunch activity and strengthen growth in job creation in the medium term. Again, in the Commission text, the Council deleted that reference. Why did it do that? Monetary policy can, within the spirit of Article 105 of the Treaty, contribute in a substantial manner to the achievement of Community objectives as laid down in Article 2 of the Treaty. That reference was deleted. Why? The Council has to explain to the House why it made these changes.
The Commission text referred to the social partners and to the dialogue that exists. The Council deleted the reference to an efficient coordination between the different actors concerned and between countries as essential to ensure the coherence of these policies. That reference was deleted and we want to know why. It deleted the reference to the fact that measures aimed at improving convergence go hand in hand with the promotion of growth and employment in the medium term. Why did the Council delete that from the broad economic guidelines? In relation to TENs - the trans-European networks - the statement proposed in the Commission text, that action has to be taken to remove the last obstacles to the achievements of the TENs projects is deleted in the Council text.
The ECOFIN Council is acting with extreme arrogance if it believes it can simply disregard growth and employment in the European Union. We were deeply unhappy in this House with the Commission text but at least it made some effort to refer to the need to bring unemployment down and to deal with the appalling levels of growth. The Council text is completely unacceptable to this House. If the Council would look at paragraph 10 of the resolution that we will vote at lunchtime today it will see that we insist that in Florence these deletions from the Commission text be reinserted, and that is the text which should then be endorsed by the Council.
Unless that happens I warn the Council that whether it be the Italian presidency winding up to their presidency in July or Mr Spring or Mr Bruton presenting the programme of the Irish presidency, this Parliament will roundly reject the conclusions of Florence, unless the Council gives a real commitment to bringing unemployment down, getting growth back to Europe and ensuring that the EMU project can continue on a path that will mean something to the citizens rather than simply being something which is pursued by central bankers.
(Applause from the left)

Christodoulou
Mr President, allow me first of all to thank Mr Lamfalussy and Mr de Silguy for their reports.
As far as the report of the European Monetary Institute is concerned, I must say that, as with the previous one, a very good and serious attempt has been made to cover the issues of preparation for the third stage, and we are pleased to see that substantial progress is recorded.
In connection with Chapter 1, however, on the growth of the economy, I have a number of observations that I think deserve discussion at greater length at some juncture. For instance, the report does not stick as firmly as I think it should to the duration of financial performances, and the importance of that is something that I think needs to be stressed all the time. The cause of smooth transition to economic and monetary union is certainly not helped if a country, after achieving satisfactory convergence figures, suddenly goes off the rails.
The Institute's report is, of course, pervaded by a certain optimism. Thinking back to my previous remarks, I have to say that it is logical for there to be some element of optimism in these analyses. Statements given out by the institutions of the European Union cannot be pessimistic in tone or doom-ridden in their assessments. Naturally, there is a very big difference between that and projecting baseless assessments and analyses. However, one can see that the financial prospects, as analyzed, are not far short of reality. Despite the element of optimism the substance is pretty accurate. That applies for both the European Monetary Institute and the Commission.
As regards the Commission's analysis and the changes in the financial prospects, I, too, have to say that I find them totally incomprehensible. Unless, that is, ECOFIN decided to adopt a purely technical approach and to refrain from policy projections and appraisals. If that was the case - and if it was I would regard it as mistaken - the deletions can be justified, but it means that ECOFIN is now functioning as a technical body rather than the policy institution which it should be.
The EMI report refers to the internal market as the instrument for growth, by contrast with 1994 when the talk was of export-led growth. Of course, the internal market is supposed to promote competitiveness, but the big difficulty with regard to competitiveness in the European Union is that we have developed a quality of life and forms of social conduct that give us problems vis-à-vis those of our competitors who are not bound by the same criteria. This difficulty, however, must be tackled in a logical and constructive manner and not by opting for things such as a slackening of monetary policy, which is the sort of thing that we often hear advocated. At this present time there is no alternative to the strict monetary policy. There is no other policy available to us, and to tackle phenomena of a structural nature with measures that are appropriate for cyclical adjustment is mistaken because it would be damaging rather than beneficial.
On the matter of unemployment, to attribute it to something entirely independent, to something which is not the consequence of other phenomena, is a massive error. Unemployment did not appear from nowhere. It is the consequence of other phenomena, of structural phenomena to be precise. We have to try to rectify these structural weaknesses, but it cannot be done via the countercyclical measures that are always being recommended here. I say again: in these circumstances, countercyclical measures would in the long term bring a result exactly the opposite of that which is desired.
On the question of convergence and relations between the Member States taking part in the third stage and the remaining countries, I must say that here, happily, the Treaty is beginning to be implemented correctly and that the analysis of the parameters is beginning to show an element of flexibility. And why is this so? The reason is that is very important that we keep to the 1999 starting date and that progress is not impeded by certain very small percentages.
In this regard, Mr President, it is important that the analyses should take account of the criteria of those countries which wish to join the EMU but will not be in the first group and that notice is taken also of factors stemming from occurrences of an urgent nature. I am thinking of my own country which, precisely because the European Union would not give political support if it were to be faced with a threat of war, is now having to embark on an armaments programme to the tune of ECU 10 billion, which will totally negate all of the efforts of recent years to achieve convergence with a view to joining the EMS and the EMU. At some juncture more attention will have to be paid to this matter than at present.

Garosci
Mr President, let me begin by congratulating the three rapporteurs, in particular Mr Gasòliba, on the drafting of the reports we have been listening to. As did the Committee on Economic and Monetary Affairs and Industrial Policy, my group is examining closely the EMI annual report for 1995, as this is a major document that deals comprehensively with the state of preparations for Economic and Monetary Union. During the coming six months, however, it will be necessary to define the parameters of the framework as a whole, as we look to the third phase and the responsibilities attaching to the European system of central banks. As Mr Lamfalussy has already said, the process of economic integration is on the right path, but the recovery we had all hoped for has not got off the ground and unemployment remains Europe's number one problem.
The EMI report clearly indicates that the solution necessitates, among other things, consistent reduction in government deficits; in that connection, the Institute should take action particularly in regard to those Member States in which those problems are all too marked and have so far prevented them becoming full members of the European Monetary System. We need therefore to look more closely and more receptively at those Member States which, although not at the moment fully complying with the Maastricht parameters, are, nonetheless, showing signs of a change in trend, indicating that their - currently negative - parameters could, in just a little while longer, meet the conditions for the single currency system.
As Commissioner de Silguy has pointed out, the EMI framework defined in Maastricht should be directed towards a more active role in coordinating the Member States' monetary policies. There has also to be preventive assessment of what might happen as a result of the coexistence of those States that belong to the single currency and those that do not, with the distortion of competition and fluctuation in exchange rates that would ensue.
There is finally a practical aspect on which we are focusing particular attention: this concerns the introduction on to the market of the new currency, the euro, and its distribution in the Member States. Explaining to the citizens of Europe how the single currency operates will certainly not be an easy process: there will have to be the maximum of cooperation on the part of those market structures in which citizens actually come face to face with the euro. I have in mind here the retail industry, in all its guises, in which there will have to be a campaign of information directed towards businessmen, particularly small and medium-sized enterprises, and towards those working at the point of sale. That will in fact be the point at which consumers discover the euro and with it perhaps a greater understanding of the Community's economic system. Public acceptance and understanding of the single currency will also imply acceptance and understanding of a united Europe.

Cox
Mr President, I am speaking on the broad economic guidelines. The Group of the European Liberal, Democratic and Reformist Party believes that there is a credibility gap at the heart of Union economic policy, which is undermining public confidence in the entire enterprise. There is a gap between aspirations and their realization, rhetoric and substance, and economic guidelines and their implementation. The gap is measured most starkly by the 18 million people out of work and up to 50 million suffering from social exclusion and poverty. It is a dismal record.
Ecofin's report to Florence on what I would characterize as the non-implementation of the 1995 guidelines, following hard on the heels of the non-implementation of the 1994 guidelines, is a ritualistic, bland and passive document in the face of this pathetic factual record. Little wonder that in their day-to-day lives so many citizens are questioning Europe's ability to deliver the goods, because they know that action speaks louder than words.
The ELDR Group is strongly committed to achieving EMU in line with the Treaty criteria and timetable, but there remains space for real policy debate.
I have several questions to the Council in the time permitted to me. From the institutional point of view, I repeat the question: why has the Council, even in the preamble to its recommendations, made no reference to Parliament's opinions?
Policy-wise, I wish to ask the Council to respond today on the question of inflation policy, where we know that inflation is historically low and contained, according to our own analyses. Why is it that it recommends these results should be improved on? Does the Council not share the fear expressed recently by the Bank for International Settlements that there is a risk of deflation if we push the price stability objective beyond what is appropriate? What is the Council's view?
Finally, on the macro policy mix conducive to growth, employment and convergence, the Commission correctly referred to Article 105(1) and let me quote it briefly: ' Monetary policy shall support the general economic policies of the European Union, including those concerning a high level of employment' . The Council today needs to explain why politically it has scandalously disregarded this capacity for an appropriate flanking measure, because symbolically it is saying to the 18 million unemployed: we frankly do not care about the appropriate mix, we are monetarists and we will do it our way. If that is your way, it is a political mistake for the Council and for Europe.
(Applause from the centre and the left)

Theonas
Mr President, the single currency scenario is paving the way for a multi-speed Europe. Our group is extremely worried about the repercussions for the weakest countries, most of all, and for the millions of workers and unemployed people in the European Union. The whittling away of the whole concept of national sovereignty, with the management of monetary and exchange rate policy being handed over to bodies such as the European System of Central Banks, which have no political and democratic legitimacy, is a particular cause for concern.
The countries which do not join the EMU will fall even further behind those which do; divergence, in real as well as nominal terms, will increase. That will be followed by an even harsher anti-popular policy for the purpose of trying to meet the Maastricht criteria, which will remain an unattainable dream. The countries which remain outside will face serious problems over resources as capital, albeit for speculation at first, moves to the euro core, and this will have a domino effect on currency reserves, on growth rates and on the living standards of workers in those countries.
The abolition of the ECU will generate new problems in connection with the Community budget and fiscal relations between the European Union and the countries which do not join the single currency. Risk premiums and the obligatory circulation during the transitional period of the new currency in parallel with the national currencies will create additional difficulties for those countries, difficulties which they will have to tackle in various ways to the detriment of their economies.
The decision to pursue further enlargement of the European Union adds another complication to the single currency process, and the costs of enlargement will be transferred down to the countries which remain outside the system. Mr President, we hope that the peoples of the European Union will fight against these options, that they will rise up and demand referenda in the Member States when the new treaties come up for approval and that they will refuse to go quietly down the one-way path of bankers' democracy.

Hautala
Mr President, the common denominator in this morning's reports is that they all want to keep strictly to the schedule and criteria set for EMU, regardless of the consequences. It is clear however that by the end of the millennium we will not have a situation where all EU countries will be participating in a common currency. In addition to this it is of course questionable whether EMU will be implemented in the first place.
In any case EMU will cause divisions in the Union, and taking into consideration an expansion from the Eastern bloc there will be at least a 'three-speed' union. As we know EMU is a continuation of the internal market. It is interesting and indicative that even Mr Mario Monti, member of the Commission, has now tabled a question concerning the fact that the internal market has not fulfilled the expectations on a macroeconomic level. As far as employment especially is concerned the internal market has hardly had any positive effect. The Commissioner has also chosen to present this report during the summit in Florence. There has to be big question mark as to whether we are in for a similar disappointment as far as EMU is concerned, since the internal market and EMU are products of the same mind set.
The Green Group unanimously supports a healthy economic policy, where there is an equilibrium in the public sector and where budget resources do not have to be largely spent on interest payments on public loans. At the moment however the European or Nordic society is threatened, because we are aiming to implement these EMU criteria far too quickly, perhaps even arrogantly. For this reason the schedule simply has to be postponed.
Another reason for a postponement of the EMU schedule is that it makes a genuine rapprochement between the economies in the EU countries possible. The economies of the European Union Member States have, according to some research, recently moved even further apart from each other.
Perhaps we should agree on a factual precondition for EMU, that employment really should be halved before EMU is implemented. This objective has been voiced by many Member States with high unemployment and also by the European Union. A somewhat more flexible economic and monetary policy would have to be considered. According to some estimates a one percent increase in inflation could help to create two million jobs.
Above all the Green Group proposes a thorough reform of taxation. The Commission has recently published an interesting document on taxation within the European Union. The document expresses the view that, essentially, taxation at the EU level should be considered as a complete entity, rather than on a tax by tax basis, since the Member States have already lost a major proportion of their taxation sovereignty to the markets, much to the politicians' discredit. No solutions regarding taxation have been achieved at the EU level, and I would like to ask the Council whether it is aware of the enormous contradiction that is involved in aiming for a rapid implementation of the EMU and the complete inability to deal with taxation, a matter with far-reaching effects on the economy and on employment.

Ewing
Mr President, I rise on behalf of my group to support the compromise resolution and to say I would like to identify my group with the questions that were asked by Mr Cox and the criticisms that were expressed by Mr Donnelly on the question of the broad economic guidelines.
The compromise resolution speaks out against this terrible gloom and doom of the 18 million unemployed and the 50 million on the bread-line. There is such a colossal loss of dignity involved here that it is surely not to be tolerated. Nor should we tolerate the many fears of our citizens: fear of those in jobs - whether they will still have a job; the fear of the lack of social protection - we have seen that in the unrest in Germany and France; the lack of consumer confidence; our growth is low and getting lower and public investment is dropping. All this demands action and yet the Council and the Commission do not seem to be listening to the European Parliament which is the democratic base of all the institutions. They must listen to us and we must see investment boosted, consumption boosted, lower interest rates, a rise in labour-intensive growth and an increase in consumer confidence.
Today, when we see greater profitability, we do not necessarily see a reduction in unemployment or an increase in wages. I have just read in The Guardian today that British Steel made £1 billion profit. We have seen incredible profits made by British Telecom recently. This has not led to higher wages or a significant increase in employment.
We also all have to guard against the wishful thinking of some of the economic forecasting we have seen from the other bodies of the Community. Economic forecasting has so often had to be revised downwards. This creates yet more mistrust out there in the minds of our citizens; it worsens confidence and has negative effects on consumers.
Turning to EMU, few Member States seem to be able at this moment of forecasting to meet the criteria. I have noted them: Luxembourg, Ireland, Denmark and the UK. Denmark and the UK have an opt-out, so in effect that is two. I was privileged to be in the EMAC delegation to Dublin recently where we had an excellent address from the Irish Finance Minister. He was pointing out that despite Ireland's strong growth they have not reduced unemployment. So, you can meet the convergence criteria and still have the basic problem of unemployment. Ireland has that in a very serious way. It must be looked at as an entity, almost separately from all these other matters.
It is quite clear that France and Germany will have difficulties in meeting the criteria, Italy more so but making confident noises and Belgium has problems with one particular aspect but surely the Benelux countries will not go in and leave Belgium out. The date is being constantly reiterated as if it is all going to happen and yet there is an air of sleepwalking, it seems to me, and of wishful thinking. Because, when you examine the criteria, very few countries seem to be likely to meet them and the flexibility which does exist does not seem big enough - to me anyway - for 1 January 1999 to be the date.
I would like to support the compromise paragraph 6 and the emphasis on life-long learning, education, and the creation of new jobs in new sectors. I am at the end of my speaking time but this recent debate in the UK about being able to leave the EU is so disgraceful and so detrimental to consumer confidence that I feel I have to mention that as well.

Blokland
Mr President, the report by Mr von Wogau is extremely useful. The European Union's internal market benefits from having a monetary system which is designed to prevent fluctuations in the exchange rates between European currencies, and we agree with the rapporteur that a 'new style' of European Monetary System will be of great assistance here. The motion for a resolution rightly states, however, that monetary stability cannot be created by EMU or an exchange-rate mechanism, but depends on the Member States pursuing a credible economic and budgetary policy.
Like the rapporteur, I too expect relatively few of the Member States to take part in the third phase of EMU in 1999. Many Member States, including France, Germany and the Netherlands, do not currently meet the entrance criteria, and there seems little likelihood that the position will change in the short term. Some politicians have panicked and called for the criteria to be relaxed, but all this does is to undermine the credibility of the euro and place a time-bomb under any new exchange-rate mechanism.
I really do wonder whether there is any point in forming a monetary union with only three or at most four Member States, since the advantages would scarcely outweigh the costs of setting up EMU. An important practical reason why we should not establish a monetary union prematurely is that it would create a barrier to the early accession of countries from Central and Eastern Europe. It would be much better to align the economic and monetary policies of the present and future Member States in a totally unforced way, with the Member States themselves working to achieve monetary and exchange-rate stability. This would improve the operation of the single market and avoid creating any unnecessary obstacles to the accession of Central and Eastern European countries.

Lukas
Mr President, the Commission's report confirms the view of those who believe that both the Union as a whole and individual Member States will be adversely affected if the monetary union enters into force step by step on the scheduled dates. Degeneration into a two-speed Europe is inevitable, and even if this state of affairs were to be only temporary, it is at odds with the goal of economic and social cohesion. The prerequisite for unrestricted participation by all Member States in the euro will be that the budgets of those countries already meeting the criteria, weakened as they will be by savings measures, will have to provide substantial support for the 'outsiders' .
The distortions of competition, caused by unilateral devaluations, which are at present a burden on the external trade balances of certain Member States, cannot be overcome by the countries with soft currencies remaining outside. It is therefore particularly important to devise as soon as possible intervention mechanisms to neutralize speculative pressure.
This report, at any rate, contains only vague and general indications, and does not state when the general guidelines for the future exchange relations between participating countries and those not yet participating will be drawn up. Yet again, the fears of citizens in many Member States are being borne out: that in view of the poor economic situation, only a few countries will be able to meet the stability criteria; and, at the same time, that the vital question of the stabilization of exchange rates between the 'ins' and the 'outs' is unfortunately only now beginning to be addressed. Furthermore, in this divided Europe, some parts of the export and tourism sectors in countries with hard currencies will continue to suffer significantly from the adverse effects of savings measures introduced in order to achieve convergence.

van Velzen, W.G.
Mr President, the reality that our economic guidelines have to deal with is that there are at least 18 million people officially out of work, with another nine million not covered by statistics. They should be getting to grips with this problem, but they are patently failing to do so. Once again, we are faced with one-sided monetarist recommendations offering absolutely no support for the active structural employment policy for which the Delors White Paper and the Essen summit laid the foundations.
Monetary stability creates confidence, but monetary stability cannot be achieved by creating social unrest. This is a crucial time at which to be holding this debate, and it calls for more balanced guidelines than those before us at the moment.
First of all, instruments and indicators are going have to be adopted at the end of the year in Dublin to give the Essen agreements a more practical form and make them more binding.
Second, the Heads of Government will shortly be meeting in Florence to plot a course for a common, active European employment policy. EMU has already shown that coordination at European level which is binding on the Member States can prove beneficial, and in Florence this must be shown to be equally true for employment.
Third, the European Commission is currently making a desperate attempt to persuade the social partners to conclude agreements on a European employment policy in the form of a pact on employment. But this will only work if we abandon our unilateral faith in EMU in the broad economic guidelines and establish a basis for agreement with the social partners, such as on creating apprenticeships for the millions of unemployed people under the age of 25.
Finally, the negotiations at the IGC are currently considering how to establish a balance in the Treaty between monetary and structural employment policy. A move from taxes on labour to energy and environment taxes can only be made at European level, and competition between the Member States means that a common policy is needed for which the broad economic guidelines should establish a basis. But there is no sign of this happening. The balanced economic policy which Parliament has called for on so many occasions involves recognizing the economic importance of the European social model. The model is not just about expenditure: it is, first and foremost, a powerful means of promoting employment by maintaining purchasing power and demand, and thus creating stability. The same applies to decent wages, which can also in turn encourage continuing training and education.
In short, restricting economic policy to a single market and a single currency is simply asking for the European Union to remain economically weak and to continue to suffer mass unemployment. For this reason, these economic guidelines should be at the very least amended or better still, in my opinion, rejected by the Commission and the Council.

Herman
Mr President, ladies and gentlemen, following what Mr Donnelly said, there is one point I should like to make first of all about the broad economic guidelines, which is that we firmly support the line the Commission has adopted, especially as it is largely based on the consensus positions reached by Parliament itself.
Although we are aware of the financial constraints which restrict what the governments can do, our group nevertheless regrets the changes which the Council has made to the Commission's proposals. That is why, unlike the Socialist Group, we do not want to tar the Commission and the Council with the same brush.
Moving on to the von Wogau report, I would point out that changes to exchange rates between the currencies of countries belonging to the same common market have always been a matter of common interest. What this means is that the Member States can no longer do as they please. It is something which applies today and will continue to apply tomorrow, something which was spelt out in the Treaty of Rome and was not amended in the Maastricht Treaty, nor is it likely to be at the IGC.
This makes sense, because changes to the exchange rates which are not simply designed to redress imbalances in purchasing power would distort competition and seriously damage the operation of the single market.
That is why, despite the fact that after difficult negotiations and completely contrary to the spirit of the Treaties, two Member States have finally been allowed to opt out of monetary union, this does not mean that they no longer have to act in tandem with all the others when it comes to realigning exchange rates. It is also totally unacceptable for some people to say that they will refuse to be bound by any future discipline adopted jointly, by democratic methods and in accordance with the Treaties, in relation to exchange policy with the euro.
If the new European monetary system is sufficiently flexible, as the rapporteur has claimed, then the United Kingdom should not have any serious objections to taking part. It is therefore a mistake to give it the option, even now, of going its own way, which it tends to do all too often these days. That is why, on this particular point, we do not agree with some of our colleagues and have tabled an amendment reaffirming the basic principles on which Europe was founded.
One final comment on the 'ins' and the 'outs' , or the 'pre-ins' and the 'ins' , to use the current jargon. There is clearly a degree of solidarity involved here, as we have said on many occasions, but it should not, as certain amendments seem to imply, go so far as to restrict the independence of the Central Bank and impose in advance certain constraints or requirements regarding its interest-rate policy.

Giansily
Mr President, ladies and gentlemen, the reports before us cover three areas of major importance: economic and monetary union, the impact of currency fluctuations on the internal market, and the annual report of the European Monetary Institute.
The motion for a resolution is an important contribution to the construction of Europe's monetary system, and the mechanism proposed by Parliament is very similar to the outcome of the discussions in the Council itself, which was presented at the informal ECOFIN Council in Verona and is shortly to be presented at the European Council in Florence.
The exchange-rate mechanism is essential if we are to prevent currency fluctuations in non-participating countries and to protect the single market. The resolution rightly points out that while it relies mainly on the Member States achieving convergence and sound financial management, it also needs to include ways of supporting any currencies under attack.
Our group has some reservations, however, concerning paragraph 4. We feel that while stable real exchange rates are certainly necessary to prevent unfair competitive advantage, stable nominal rates are also a powerful deflationary force, help towards convergence and underlie the very principle behind the European Monetary System.
In order to prevent exchange-rate fluctuations in future, we agree with the resolution that we need greater convergence and closer monitoring of the macro-economic situation within the Union. The report also opposes any corrective measures which run counter to the rules of the single market, and it proposes specific measures to help small and medium-sized firms.
On the subject of combating currency fluctuations, I would point out that the French Finance Minister recently put forward three proposals to his Union counterparts designed to prevent exchange-rate turbulence. The measures involve keeping payments made under the Structural Funds in line with changes in the real exchange rates, introducing macro-economic conditionality for Structural Fund payments similar to that which applies for the Cohesion Funds, and making procedures stiffer under the broad economic policy guidelines.
The resolution proposes the right way to prevent currency fluctuations: stronger macro-economic and budgetary discipline in the Member States, which will boost economic convergence and prevent the imbalances which are the source of financial instability.
Once we have entered the third phase of EMU, the same question will arise in relation to the currencies of those countries which are still outside the system. The Council has already made progress in this direction by adopting, with the exception of the United Kingdom and Sweden, a proposed exchange-rate mechanism based on the EMS. The technical details are to be finalized at the Dublin Council, which is a concern raised in the motion for a resolution.
Our group has serious doubts, however, as regards the proposal to introduce a tax on currency speculation. How can you tell the difference between a speculative transaction and a cover operation? How effective would it be in a world where capital moves around freely and European currencies can be traded in financial centres in America, Asia and elsewhere? In other words, why should we give the rest of the world an advantage over Europe at a time when unemployment is still our biggest problem? It is subject to these reservations that our group supports all three of these reports.

President
I have received seven motions for resolutions pursuant to Rule 40(5) of the Rules of Procedure.

Boogerd-Quaak
Mr President, ladies and gentlemen, there are enormous challenges involved in introducing a single currency, and our experience up to now has taught us a number of important lessons about the exchange-rate arrangements between the countries at the centre of EMU. I would emphasize once again, perhaps unnecessarily, that any arrangement that limits reciprocal exchange rates is always better than no arrangement at all, and we should therefore follow the recommendations put forward by Mr Gasòliba i Böhm and Mr von Wogau. However, leaving aside the tremendous importance of EMU, which my group hopes will create jobs, we must not forget the terrible problem of unemployment. As many speakers have already mentioned, we have 18 million people out of work and many different forms of hidden unemployment. It is a subject we have been talking about ever since I have been in the House. An excellent report was produced on employment, growth and competitiveness which we have been discussing for two years now, but it has not yet been implemented. The Council is mainly to blame for failing to make adequate progress on its recommendations concerning education and training, greater flexibility on the labour market, new working hours, shorter working hours and above all shifting taxes on labour onto other targets.
I also gather that in the pact on employment which President Santer is taking to the Florence summit, the 17 areas where employment could have been created, mainly in the regions and the cities, have been dropped. I should like to know why the Council has decided against implementing all these specific examples on which Parliament and the Commission have worked so hard.

Svensson
Mr President, despite all the considerable doubts and criticism the leaders of the Union continue obstinately to insist on a dogmatic theory and its implementation - a theory which has no basis in reality. What are the consequences which we can all see? They include the inability to pursue a constructive economic policy, the destruction of important social infrastructure, powerlessness and cynicism in the face of mass unemployment and social crisis, total capitulation to the destabilising effects of speculative finance capital and now finally also the risk of splitting the Union.
What conclusion should be drawn? The conclusion is that it is time to give up an obsolete, dogmatic idea and choose a modern, flexible form of monetary cooperation and economic policy which is grounded in reality.

Berthu
Mr President, ladies and gentlemen, how we have seen our language and ideas change since the Maastricht Treaty!
In 1992, we were promised that all the Member States of the Union would adopt the single currency by 1 January 1999 at the latest, apart from a few minor derogations. We maintained at the time that this was completely unrealistic, and we asked instead that the European Monetary System should be reformed so that it would work properly. Today, those responsible for the single currency project have been forced to invent a new monetary system, more or less at the last minute, in order to prevent the Union from being split into two or more groups. Even worse, having proclaimed that the EMS was dead and buried, they are now having to resurrect it, and having said that the single market could not function without the single currency, they are now having to admit the opposite.
However, while the current developments are certainly heading in the right direction, we are still not entirely happy with them, for two reasons. First, the new EMS cannot be more than a temporary arrangement, since the official objective, in theory at least, is still a single currency for everyone and convergence in the foreseeable future. This policy seems as unreasonable as expecting all the Member States to go for the single currency at the same time. It suggests that it will be possible to apply a single economic policy across the board in the near future, which presupposes that our problems and therefore our societies will be as one.
In our view, this is ridiculous!
If disparate societies have this bureaucratic convergence forced upon them, it could have a very negative or even destabilizing effect on the system.
Another reason why we have our doubts is that the new system they are trying to invent has never been thought through and has never been democratically approved by the national parliaments, despite the occasional indications that you find here and there in the Treaty. It is difficult to impose discipline where it has not been accepted, and we cannot take a major step of this kind in the dark, so we shall sooner or later have to reopen formal discussions on the subject.

Martinez
Mr President, Mr Lamfalussy, Commissioner, the reports by Professor Pérez Royo - who totally disagrees, incidentally, with Milton Friedman, the monetarist, who thinks the single currency is suicide - Mr Gasòliba and Mr von Wogau bring us back to the 'theological' and 'teleological' problem of the single currency.
Let us consider the theological problem first of all. Is the Lord good? Is the single currency good? France's strawberry producers tend to think the single currency is good because of the devaluation of the Spanish peseta. But as it happens the Spanish peseta and the Italian lira, which are of interest to France's cattle breeders, will probably not even join the single currency, so the apparent advantages are somewhat deceptive. And even if the Fifteen all join, the dollar will not, nor will the undervalued currencies of South-East Asia, Morocco and so on. The single currency might suit the European single market, but the single market is becoming less and less European and more and more global, mainly because of the European Commission's free trade policies.
Another much more serious problem is that a currency is nothing more than a vehicle for information on the economy. It is the reflection or shadow of the economy, not the economy itself. It is like the story of Plato and the cave; it is the signifier, not the signified. But trying to force 15 different economies to have the same official monetary shadow is really just forcing them to chase their own shadows. Experience shows that if you chase your own shadow, you will eventually fall down exhausted and die. And that equates, in economic terms, with unemployment, austerity, recession and protests, even in Germany.
This brings us on to the teleological problem, or what it is all for. The single currency may be fine, but what is it for, what purpose does it serve? Is it Europe's objective to have a single currency, a single central bank and a single market, or is it prosperity, democracy and development? Forgive me for saying so, Mr Lamfalussy, but when Articles 107-109 say that the president of the European Central Bank shall not take instructions from anyone, it smacks more of oligarchy than democracy. So even if there are some kind of parliamentary controls, they will not go very far.
And if the aim is prosperity, Mr Pérez Royo, the situation of farmers in Andalusia, Finland and France reflects what Jaurès said about money being the blood of the poor. Just look how we have forgotten what history has taught us! We have already had a single currency in Europe and throughout the world: the gold standard. But it did not stop deflation. The great depression in America happened at a time when it had a fixed exchange rate with the gold standard.
I know that I will not convince you, Mr de Silguy, since this is a religious question. At least we shall know what to think about the disasters it will bring in its wake. Market forces produce contaminated meal.

Randzio-Plath
Mr President, if we wish to have monetary union, we must combat unemployment in the European Union, as is repeatedly stressed by both the European Monetary Institute and the Commission in its annual economic report. To my mind, however, it is not enough to carry on as before. We need to provide greater impetus on the structural policy side, and that is why the economic policy guidelines must indeed be reoriented, as Parliament is calling for today. This is now more important than ever, because we need a more optimistic and confident approach in order to complete the project of monetary union. If, happily - as is also noted by the EMI - the work is on schedule, this project must not be jeopardized by a lack of credibility as regards the other policy elements. I do hope that the European Monetary Institute will continue to adhere to the timetable, and that Mr Lamfalussy can give us a guarantee that the EMI will carry out its evaluation of convergence this autumn in such a way as to establish whether or not a majority of the Member States meet the convergence criteria, so that there is clarity about the appraisal and the scope for interpretation, and also about the need for participation in a European exchange-rate mechanism.
The House stated very early on that currencies not participating in European monetary union should be linked to it by means of an exchange-rate mechanism with the euro as its anchor-point. Fortunately the monetary institutions, as well as the Commission and the Council, have since come round to Parliament's position.
What kind of mechanism should this be? In my opinion, we need a European system of solidarity and stability, because on the one hand the currencies not belonging to the monetary union must be protected from speculative attacks, and on the other a split in the internal market must be prevented. Above all, we should assure the other currencies of our support and solidarity, so that they can join the monetary union as soon as possible. In fact, as the past few years have shown, exchange-rate turbulence has a detrimental effect not only on economic growth, but also on employment. It is therefore important to introduce an exchange-rate mechanism on these lines, in order to maintain the credibility of the initiative.
In my view, it is very important that the European Monetary Institute should conduct further studies of these exchange-rate fluctuations, in particular to examine their micro-economic effects, since these can give us a much clearer picture of individual sectors and branches of industry, especially in 1995, and show how these elements have contributed to the lack of confidence in business circles. Ultimately, what is crucial today is not wage costs, but the factor which distorts competition within the internal market by pushing up unit labour costs in countries with hard currencies, namely exchange-rate variations and fluctuations, as well as exchange-rate protection operations. So it is high time for us to invent a mechanism which makes one thing clear: that those currencies which do not participate in monetary union immediately will be able to join in later, and that the internal market as such will not be fragmented; rather, European monetary union is a further step towards its consolidation, and another contribution to the multinational dimension of the market.

Rusanen
Mr President, unemployment is at the moment a Europe-wide problem, to which a solution is sought in all Member States of the European Union. Unemployment does however not a constitute a barrier to joining the EMU, since EMU not only improves competition but also increases demand, which helps maintain employment. EMU reduces sharp economic fluctuations, lowers the interest rate particularly in smaller European countries and increases trade within the internal market. There is no short-cut to employment and it is not improved by short-term measures.
Economic and monetary union is a natural extension to the internal market, since full benefit from the internal market can only be achieved through co-operation and convergence within economic and monetary union. It is true that the implementation of the third stage of monetary union within the schedule set in the Maastricht Treaty is uncertain, due to economic problems. However, a postponement of the third stage and the postponement decision in itself will slow down the recovery of the European economy, keep interest rates high and cause great economic uncertainty. By fulfilling the EMU criteria stability can be achieved. The political decision-making within the economy, regarding both exchange rates and interest rates, will decrease, and this reduces the benefits of not joining the third stage.
After EMU's third stage, currency policy will be of general concern to Member States. Price stability has to be regarded as an essential objective both within and outside monetary union. Countries outside the EMU should receive help from the system to join at a later date, and the system should not complicate activities in the internal market or the European Central Bank's monetary activities. From the point of view of EMU support, it is important for the Commission to define the currency rules for the countries staying outside the EMU during the course of the current year. I hope that the Commissioner will see that this is implemented and aim at finding a solution to the situation as soon as possible.
The rapporteurs' views on the current situation of the EMU and on the preparatory stage prior to progressing towards a common currency are realistic. I find however that fulfilling the convergence criteria is more important than linking floating currencies to the European monetary system, since it enhances political credibility regarding economic issues and provides greater opportunities for achieving both monetary stability and national economic stability.

Gallagher
Mr President, in April 1996 the European Monetary Institute published its annual report for 1995. This excellent document contains a section detailing the economic and financial conditions in the European Union including the existing situation in the different Member States with regard to the Maastricht criteria of convergence necessary for the successful implementation of economic and monetary union.
Our group, for its part, recalls the necessity, eventually, for the participation of all currencies of the European Union in the exchange mechanism if we wish to guarantee the correct working of the single market and ensure the transition towards EMU. Mr Böhm's report, which we generally support, welcomes the EMI report and draws on its main principles, which are the need to follow the Treaty at all institutional stages towards the transition to the third stage of EMU; to continue the reflection on exchange relations between the future Euro-zones and other parts of the Union; and continued pursuit of the adjustment of public debt.
The Institute's report, like the rapporteur's resolution, goes in the right direction from the point of view of our group, with one slight exception. In fact in one of the recitals the motion for a resolution notes a contradiction between the EMI and the European Commission with regard to their explanations of the economic fluctuations which were so evident in 1995. The term is a bit strong and for our part we think there is consensus and that the prognoses of the two differ only in the respective importance given to the level of the rate of interest in 1994 and to the monetary fluctuations during the first quarter of 1995 as well as their impact on the confidence of economic agents. In this general outline our group welcomes the report by Mr Pérez Royo, which puts the emphasis on the efforts in terms of convergence and budgetary discipline, which alone are able to prevent monetary fluctuations.
In conclusion, we believe that the system of monetary cooperation is not the competence of the Commission and the EMI alone, but also the competence of the Council, the EMI and the Commission respectively. At the same time one should bear in mind that the possibility of narrower bands of fluctuations should not be the only resort of Member States concerned and that there should also be a multilateral framework at the disposal of the Ministers of Finance, of the European central banks and of the central banks of countries which are not yet in the system.

Kestelijn-Sierens
Mr President, ladies and gentlemen, I should like to make a specific comment on behalf of my group on the Pérez Royo report. The Liberal Group agrees with the main thrust of the report, but we have two fundamental objections to paragraph 4, which states that a tax on currency speculation can help to keep the exchange rates calculable.
First of all we doubt just how effective such a tax would really be, and it is not even a good idea in the first place. Why can we not introduce this tax? Because we could not limit it to currency market transactions, otherwise the speculators would simply turn to other financial transactions such as derivatives. Furthermore, the introduction of such a tax in Europe would simply mean that capital movements would shift to other countries such as Singapore and Hong Kong. In other words, if the tax is to be introduced, it must be extended to all financial transactions and to every country in the world. But even if we succeeded in introducing the tax, it would still not be a good idea. First, it would lead to less liquidity on the financial markets, which can in itself trigger greater currency fluctuations. Second, it would also make capital more expensive. It makes no distinction between genuine speculation and investment. Both business credit and cover transactions for direct investments would be affected, and curbing investment is surely the last thing we want. I find it extremely regrettable that the idea of taxing currency market operations is brought up time and time again without ever being properly thought through, and that is why I and my Liberal colleagues will be voting against the paragraph in question.

Ribeiro
Mr President, one more voice, one more minute. So that once more it can be made clear that the so-called path of consensus is not actually a path of consensus at all. What was decided about EMU and a single currency at Maastricht was not set in concrete. Reality has shown that the planned path cannot be achieved.
One voice and one minute to remind everyone of unemployment and social decline and the share of responsibility borne by the nominative criteria which served to impose a policy even though they were proved to be unattainable.
But after the total inflexibility shown towards arbitrary goals and deadlines we might now have a more easygoing and arbitrary flexibility in the interpretation of the Treaty articles once it has been realised that applying previously set and inflexibly applied conditions was out of the question.
Above all, one voice and one minute to assert that the problem is the fall in demand, the orientation of investment, the need to tax speculation and stimulate production and job creation. To change our economic policy to one where the single currency has its rightful place of monetary instrument and the objective is improving social conditions.

Belleré
Mr President, ladies and gentlemen, representatives of the Commission and the Council, since September 1992, there have been a number of devaluations of national currencies: one of the most significant, in terms of loss of value, was that of the Lira, which lost as much as a third of its value against the Deutschmark, causing the Lira to depart the EMS. And now, in Italy, all we hear about is the re-entry of the Lira into the European Monetary System as soon as possible.
This seems to be a priority which, in my view, is likely to cause us to lose sight of the fact that the prime objective that the Italian Government has to achieve is to reduce the government deficit and, therefore, apply a sensible and stable fiscal policy which may help ease the rate of inflation which, in Italy, continues to be one of the highest.
It is precisely because I agree with the spirit of the report by Mr Fernando Pérez Royo that I am worried therefore: the devaluation of the Lira has been the consequence of speculation and short-term economic policy but, at the same time, we have seen it recover very rapidly against the Deutschmark - something which I personally find it hard to come to terms with, precisely because of the rapidity of this development which leaves me confused. We need to have transparency: a policy of transparency is a good thing, and nor do I believe that this sudden revaluation of the Lira is the result of the so-called confidence of the markets in the stability of a government which has been barely two months in existence. I therefore ask that we delve deeper into the causes of financial fluctuations which occur too regularly not to be suspect, bearing in mind that there was a time in Italy when all it took was a 'leak' of information on guarantee notes to send the Lira tumbling, with the cost then being borne by Italian workers in terms of their purchasing power.
To conclude, Mr President: we need common aims and a common macro-economic policy designed to resolve those economic and monetary problems currently besetting certain Member States which could, however, affect others in the future.

Harrison
Mr President, in welcoming the 1995 EMI annual report, I wish to congratulate not only Parliament's rapporteur, Mr Gasòliba i Böhm, but also EMI President Alexandre Lamfalussy, who has recently announced his retirement in 1997. That does not, however, mean that the Socialist Group agrees with all that is set down in the 1995 report or, indeed, the rapporteur's gloss on it. In many areas the report adumbrates ideas given wide currency in the Commission's annual economic report, on which Parliament has already pronounced.
Some differences between these two snapshots emerge however. The EMU idiosyncratically scarcely mentions the shaky state of consumer and business confidence as a significant contributing factor in the current and recent economic slowdown. As a consequence, it omits to highlight the need for active measures, including the judicious use of monetary policy to prompt recovery of business and consumer confidence. On the other hand, the EMI report talks glibly about the rigidities of the labour market and seems to follow the simplistic approach that labour-market flexibility means poorer wages and conditions for workers rather than improving their mobility through education, training and investment. Similarly, the doubtful observation that percentage rates of public expenditure were unacceptably too high, was only half-heartedly qualified by Mr Lamfalussy when he came under fire in Parliament's Subcommittee on Monetary Affairs recently.
Finally, the EMI report failed to point a finger of blame at the rigid monetary policies pursued by some national monetary authorities whose effect in the real economy has been so deleterious. Socialist amendments underscoring some of these sins of omission and commission have been incorporated in Parliament's report. I am also pleased that future EMI reports will contain more detailed analyses and evaluations of the effect of the exchange-rate fluctuations on the economy.
Secondly, Mr Lamfalussy has promised that he and his successor are prepared to issue half-yearly reports on the EMI's preparatory work for EMU. This will give greater transparency to the EMI's work and that, in turn, will benefit us all.
Mr President, on a point of order. Every speech that I have sat through this morning has been extended one way or another through your incompetence in the chair. It is no good exhorting people to shorten their speeches. You are in the chair on behalf of Parliament to shut people up when they go over time, because they transgress on other people's democratic rights to speak in this Parliament. Could you wake up and do something about it?

Peijs
Mr President, if everyone keeps to what has been agreed, not just here in Parliament but everywhere else, then economic and monetary union will be in place by 1999. It is not just the politicians already in favour who believe it will happen, the financial markets also already seem to be counting on it, as we can see from the convergence of long-term interest rates in France and Germany. Next comes the man in the street. We are going to have to earn his trust in practical ways, by meeting the criteria and by providing proper information from now to 2002.
My group believes in the single currency, let there be no mistake about it. But we do still have a number of questions which I should like to put to the Chairman of the European Monetary Institute, Mr Lamfalussy. The Treaty states that the central banks must make themselves independent of the decision-making powers of their governments and parliaments by 1 January 1999 at the latest. At the same time, the institutions of the ESCB, the European Central Bank and the central banks, are not to take any further instructions. This is often referred to in the press as the sixth convergence criterion. The majority of the national central banks do not yet meet the independence requirements, and far too little progress is being made here. Finland, Greece, Ireland, Italy, Portugal and Sweden have done particularly badly. And even once a bank is formally declared independent, it may take a considerable time before it develops its own tradition of independent decision-making.
The independence of the future European Central Bank would provide a sound basis on which its president could build a reputation for reliability. France yesterday came up with a proposal that could become the political equivalent of the Central Bank, or something resembling an economic government, as Mr Pérez Royo described it this morning.
I should therefore like to ask Mr Lamfalussy two questions. What does he think in general terms of the progress made by the central banks towards independence? And does he see the French proposal as a restriction on the independence of the Central Bank in particular? Do Mr Waigel's 'stability pact' and other similar proposals also imply restrictions on the independence of the Central Bank?
I should also like to ask about the blueprint which the EMI is to produce for the future operation of the European Central Bank. According to the Treaty, this blueprint is supposed to be ready by the end of this year, and it is being increasingly widely reported that the Central Bank is probably going to pursue a policy of controlling the money supply. This was the system used by the German central bank, the Bundesbank , and according to reports it worked successfully in only ten years out of twenty. What is the argument in favour of using this system?
My third and final question is this: what does Mr Lamfalussy estimate the value of the euro will be against the Asian currencies? I ask this because I am convinced that in some sections of the market, the European currencies are overvalued against the Asian currencies and vice versa, and that this may lie at the root of some of our unemployment.

Watson
Mr President, thankfully we live in a Community where the weapons of war these days are economic rather than military. It is important that we seize the opportunity to get our economies together to prevent future conflict. It is a bit like the difference between nuclear fusion and nuclear fission. We all know that nuclear fission is an inherently dangerous process, as indeed is a fission in our economies. But if we were able to achieve the economic equivalent of nuclear fusion and fuse our economies together, we all know that the benefits would be great and that we would produce a lot of economic energy through a growth in trade on our continent and a lot more jobs, which is so important.
I belong to a tradition of a party in Great Britain which has always believed in the United Kingdom's full participation in economic and monetary union. Indeed, one of the more eminent members of my party, Mr Roy Jenkins, in his time as President of the Commission, was one of the main proponents of currencies coming together. I am proud to be in that tradition, to stand against the prevailing government policy and sentiment in my country.
Mr von Wogau said that perhaps it would be better if the UK did not join a single currency. I beg to disagree with him. I am arguing very strongly in my country that we should join a single currency. It is important for us irrespective of its importance to the European Union as a whole. On Black Wednesday in September 1992 we saw the immense damage that can be done by great devaluations of currency.
In his report, Mr Pérez Royo talks about the growth in Italian competitiveness through the short-term devaluation. One can also look at the growth in UK competitiveness and the damage it did to the French and Belgian economies. I do not agree with him that we need a tax on currency speculation but certainly we need to avoid this kind of movement.
Finally, I am arguing in my country that the logical consequence of an opt-out from the single currency is a lockout from the single market. Countries cannot co-exist in a single market with partners who reserve the right to indulge in competitive devaluations to gain short-term advantage over their neighbours. If we live in a union it is a union where solidarity in these matters must prevail.

Speciale
In our view, the point of this debate we are holding is that the economic guidelines and, above all, the political measures taken so far are insufficient given the real state of affairs; the truth is that we are in a stage of economic slow-down with an unacceptable level of unemployment. And so, if in those circumstances the internal market is not strengthened, if there is no fresh investment, if we do not have an effective employment policy, that slow-down could turn into a new period of recession and, if that situation persists, then the time-scales ahead of us cease to be credible. This is a political and not a technical problem. The closer we come to the third phase, to the single currency - which is essential and has to be maintained - the clearer it becomes that Economic and Monetary Union has not been brought into effect as a whole and, more particularly, that Economic Union has not moved forward. There is at present not even a trace of government of the economy; there is no coordination, save in theory, between the Member States; and the main guidelines are not being put into practice - despite the fact that those are the very elements that need to be given a boost, not forgetting the priority to be accorded to employment, as happened at the tripartite conference recently held in Italy. That is the point!
Finally, we must be clear that the policy of austerity, albeit vital, cannot be allowed to destroy development; that is fundamental point but does not seem to me to be taken fully into account in either the discussion or the documents of the Community Institutions. That is why I think it would be a mistake to make the Maastricht criteria stricter, as some would wish. What we actually need is to revert to an intelligent reading of Article 104c which says, among other things, that public investment needs to be rid of deficit - and that is a basic factor. I know that it is difficult to balance out deficits with a high level of public investment; difficult to reduce the fiscal pressure on employment, as Commissioner de Silguy said, but that is what needs to be done, and coordination between the Member States is needed for this.
I wish also to point out that, as President Santer rightly said in a recent statement: we need to make full and good use of the Structural Funds - ECU 170 bn - to aid investment and employment. The Commission and Council must do more here.

Carlsson
Mr President, honourable colleagues. The economic guidelines now before us are marked by the preparations for EMU and the tragic fact that the European model has created a situation involving 18 million unemployed and 50 million people suffering social exclusion.
It is obvious that the new jobs and sectors of the future are not thriving in today's EU. I am convinced that cooperation on economic stability and a common currency is the most important contribution that the EU can make towards the creation of better conditions under which we can all be more competitive, achieve greater growth and thus create new jobs.
Even for those countries which will not qualify for the first round of EMU the process has resulted in a thorough and in many cases necessary revision of the economy. For it is to be hoped that we have come to the end of the era in which budgets could be expanded and politicians could buy popularity by shifting the burden of debt irresponsibly onto future generations.
Much remains to be done, however, as part of a structural revision, responsibility for almost all of which lies with the individual countries. It is the responsibility of the members of ECOFIN and of the Ministers meeting in Florence to effect changes in the various countries' national tax, social security, labour market and education systems rather than just talking about them. As regards the Union, and not least us here in Parliament, it is a question of gearing our work to deregulation and not to new expensive regulations which hinder development.
I would stress what is said in the guidelines, namely the need to reduce expenditure and the fact that increased taxation is not an alternative, particularly with a view to our competitiveness. We must thus forcefully reject increased taxes, European taxes and in particular the proposed Tobin taxes.
There are no quick and easy solutions to the problem of unemployment. We could learn something from other countries' experiences, however, more quickly than getting bogged down in meaningless political formulations about vague ideas of an employment union which has shown itself to have no effect whatsoever, at least not in the way it has been put into practice in my country.
The old structural problems in Europe cannot be ignored. The omissions of many years must be dealt with in the short term if we wish to retain our prosperity. And we have white papers, Essen conclusions, these guidelines - which is to say that the conclusions and the direction to take are clear. I should now like to hear fewer fine words and see more concrete evidence that the leaders of the EU are really serious about their goal of halving unemployment.

Berès
The Commission's recommendations to the Council on the broad guidelines of economic policy are a source of some concern to us, since they appear to be determined by a strictly monetarist approach in which employment and growth are incidental considerations.
This approach could take us straight to the wall. Look at what is happening in Germany, Belgium and France. We cannot have a single currency if we do not have the support of public opinion. The currency has no virtue in itself, but it has a vital political dimension and represents part of what it is to be European.
What is more, experience has shown us that in industry for example, excessive belt-tightening can be counterproductive in that it destroys the social cohesion which everyone agrees is a vital element in being competitive. This is also true of the macro-economy, but its importance is underestimated, and I therefore wonder what Mr de Silguy means when he recommends 'suitable' wage increases.
In his preliminary remarks, Mr Lamfalussy told us that we should seek to get to grips with the serious problems facing us. But if we are to do so, we cannot accept the economic guidelines being proposed by the Council and the Commission. In particular, the Council must agree to adopt and finance the 14 major infrastructure projects proposed by Jacques Delors, which Parliament has called for time and time again. On the jobs front, our structural policy must be to reduce working hours. Looking beyond the accepted monetarist approach, simply saying that we intend to invest in infrastructure and human resources is not enough, we must also say how we intend to do this and how much we intend to invest.
I have one comment on the report by Mr Pérez Royo. His proposal for a tax on currency speculation is absolutely vital for the system we wish to introduce, and Europe should take the initiative on this subject at the next G7 meeting.
Finally, while we are in favour of monetary stability, it is our political responsibility to condemn the conditions under which the Council and the Commission expect us to pursue this objective. The Commission's economic guidelines are unacceptable, and have been made even more so by the ECOFIN Council. They merely demonstrate that our executive bodies have caved in to monetarist pressure, and they play into the hands of those who oppose the single currency.

Mann, Thomas
Mr President, what message do Europeans have for our almost 18 million unemployed people? Are we able to solve real problems, instead of simply making solemn declarations? New jobs in the environmental sector, social services and information and communications technology are not enough in themselves. Disputes over competence will not take us any further forward. Only when measures at European level are coordinated with those of the Member States will effective results be achieved.
Jacques Santer's confidence pact on employment in no way impinges on the legitimate aim of subsidiarity. A chapter on employment in the new EU Treaty will not in fact create a single extra job, but the foundations are being laid for an active policy on employment. After all, the Commission is supposed to complement, not replace, measures taken by the Member States.
It is therefore not a question of new programmes costing millions, but rather of jointly agreed resources, such as the Structural Funds, being coordinated so as to enhance their effectiveness. The European Council in Essen took the first real steps by establishing five areas for action. The Madrid Council then decided to reduce regional imbalances, not least as a means of combating long-term unemployment. Research and development must be strongly promoted, alongside small and medium-sized enterprises, which provide the bulk of the jobs and traineeships in Europe. We need more flexible working hours, greater investment in training and further training, the introduction of lifelong learning and more generally a policy of stability. The convergence criteria and the third stage of economic and monetary union must be adhered to. As a hard currency, the euro will help to boost investment and to create new jobs in Europe.
The social market economy is and will remain Europe's number one export in intellectual terms. But both parts must be in harmony: the economic part, with an increase in competitiveness, and the social part, which must never be allowed to fall by the wayside. Our model is based on consensus, not on confrontation. The alliances on employment which should be pursued and respect for the interests of the social partners belong in this context.

Hendrick
Mr President, I will start by bringing the House's attention to the Delors White Paper which was charged with the task of providing a blueprint to get 15 million of Europe's citizens back to work by the year 2000, an ambitious task but one which I believe we should still pursue. At the same time we have within the Maastricht Treaty a timetable laid down for monetary union which we need to stick to. Indeed until recently the growth projections of both the Commission and the OECD suggested we could still possibly complete that task of getting millions of people back to work by the year 2000.
What concerns me is the revision that has taken place on those growth figures and the likely impact on jobs. The jobs, I believe, will not come with such low revised figures and what we really need is the measures outlined in the resolution that will go before Parliament shortly so that those jobs are created. Modest growth in itself will not bring those jobs. What is clear is that the reductions in the number of people paying income tax because of the increased unemployment and the increased number of people dependent on social security payments will seriously affect the achievement of the debt and deficit targets of Member States in the European Union, and I draw Members' attention particularly to the situation in Germany. Only by getting people back to work, getting people to pay taxes, reducing social security spending as a whole, will we actually get to meet those debt and deficit criteria and see jobs and the single currency at the same time.
We know that growth does not guarantee jobs but without growth jobs will not be created at all. Mr Santer came to us with a package of confidence-creating measures which at the moment seems to many like a confidence trick. What we need are the measures outlined in our resolution in order to see the real growth and the real jobs that we need in Europe so desperately.

García-Margallo y Marfil
Mr President, I have listened carefully to the speeches of all those have taken part in this debate, and I was particularly struck by Mr de Silguy's comments. I would agree with the Commissioner that the introduction of the single currency must not give rise to a split between the rich and poor countries of the European Union, but I note with regret that this statement is far from consistent with the intention expressed by the French Government - and partly taken up by the Commissioner - of at least studying the possibility of paying Community grants in depreciated currency and - what is worse - of making Structural Fund support conditional on the improvement of public finances.
Besides having no legal basis in the Treaty, these two measures - and especially the second - would be in clear conflict with the Commissioner's statement, since they would mean adding new penalties to the existing penalty of exclusion from the hard core, increasing the 'pre-in' countries' difficulty in joining the common currency, and ultimately widening the disparities and causing the split which the Commissioner does not wish to be created.
The Spanish delegation supports the establishment of an exchange-rate mechanism which encourages the convergence of those countries which do not participate in the third stage of EMU from the outset and protects their currencies from external pressures. However, it does not - and will never - support the introduction of penalties which make convergence more difficult and impede the entry of those countries which initially remain outside the hard core.

Metten
Mr President, economic growth will not be a magic cure for all the European Union's problems, but adequate growth is absolutely essential if we are to achieve both our current main aims of higher employment and economic and monetary union.
The first thing we might expect the broad economic guidelines to do is to set a course for achieving adequate growth in the short term. It is therefore quite astonishing to realize that neither the version put forward by the Commission nor the ECOFIN version actually does this. What is worse, if we followed today's recommendations to the letter, our already stagnating growth would be slowed still further. The main problem seems to be that the Commission and the Council live in a one-dimensional world of supply economics where the concept of demand is completely taboo, so no account is taken of the impact which the recommendations given in the broad guidelines might have on actual demand. The Member States' convergence programmes are still under review, with adjustments being made to accommodate declining economic performance, and we shall not see the cumulative effect of all these until the end of the year at the earliest. Clearly, the idea that 90 % of the Union's gross national product is earned within the Union itself and only 10 % through external trade has not yet got through to everyone. If the Commission and the Council are recommending a number of measures designed to curb demand to all the Member States, where are we going to find the impetus for growth to help us increase employment and achieve EMU? From the 10 % of GNP which we earn from exports outside the Union, against a background of strict monetary policy geared towards lower inflation, when the BIS is already warning against deflation? By refusing to take advantage of the flexibility built into the EMU criteria and imposing an unnecessarily severe programme of belt-tightening on all the Member States, which would run counter to present economic trends? And by curbing wages in all the Member States, so that there is little growth in internal purchasing power and therefore in intra-European exports?
When our joint resolution says that the approach adopted by the Commission and the Council is unrealistic and inadequate, we are really understating the case. It is actually a danger to the Union, and must therefore be rejected.

Rönnholm
Mr President, we are here to discuss a common project, the single European currency, and its next stage. A precondition for the progress of EMU is that European citizens have confidence that it is justifiable. Large Member States play a significant role in this. The interest rate is a good example of the above. The interest rate of the anchor currency will have to be lowered before interest rates in my own country, Finland for example, can decrease, even though Finland has the lowest inflation rate in Europe.
Finland has discussed joining the European exchange rate mechanism. Before joining, however Finland wants to be certain that the anchor currency, the German mark, is not used to protect Germany's national interests, as was the case in the early 1990's, when Germany was forced to sustain an unrealistically high interest rate in order to prevent an inflationary election campaign of a politician which would affect the value of the German mark. This lead to a collapse of the entire ERM, and the weak ones are still struggling with high unemployment as a consequence.
In EMU discussions we are talking about necessary savings within the public sector. With regard to EMU's progress it is important that this concept is not misunderstood. Public savings should not mean that everybody is saving - on the contrary. The private sector in particular, where there is money, should invest and also spend. This serves to bring about an equilibrium in the public sector, more jobs are created, more tax revenue is collected and there are fewer costs related to unemployment.

Katiforis
Mr President, Commissioner, Mr Lamfalussy, ladies and gentlemen, I wish to concentrate on just one aspect of the subject that we are debating; on a very important aspect on which the success of the whole single currency venture may hinge. Namely, the relations between the Member States in the first group and those which remain outside.
We have before us a first class report, and I would like to congratulate Mr von Wogau on the intellectual range that he has displayed in producing it. However, various points have remained unclarified in this debate and I will recall them for you now.
First, the likelihood that the countries which are not in the first group will face a worsening of the terms of the Treaty because of the stability pact, otherwise known as the Waigel pact, about which there is intense discussion. The Waigel pact makes things worse, and it matters not whether those in the first group agree on it. What matters is that it will worsen the situation and make things much more difficult for the countries in the following group.
To put it in a nutshell, I think that the main issue that should be concerning us in the whole affair is the position of the European Central Bank which will support the currencies of the countries which are outside when they are threatened, but only sufficiently, so it tells us, to prevent a threat to the stability of the euro. And, of course, that is just as it should be. No one would wish to see the stability of the euro threatened in the very early days or to see it sacrificed on the altar of stability for the currencies which are temporarily outside. However, there is no reason why it should ever come to that, because each intervention by the Central Bank in support of a currency can be sterilized. The essential element is equitable apportionment of the interest cost, of the cost of interest rate changes, so that the economies of the countries which have remained outside are not excessively burdened. I would like the Commission and the European Monetary Institute to take note of this point.

Caudron
Mr President, ladies and gentlemen, with three days to go to the Florence summit, it was important for Parliament to say what it thinks about the economic situation in the Union and its economic and social prospects. The only option open to us was an oral question, and so I now have only two short minutes in which to restate my dissatisfaction at the far too liberal approach adopted by the Commission and the Council. Budgetary discipline, combating inflation, flexible working conditions and increasing competition have proved to be anything but the right way to get Europe out of its present severe crisis, with 18 million unemployed, 50 million people living in poverty, inadequate demand, a lack of confidence, falling investment and excessively high interest rates. None of these remedies has worked.
As the French socialists see it, we should instead promote economic growth by bringing interest rates down, abandoning the fight against inflation, which is now in any event practically non-existent, channelling profits towards investment in order to create jobs, implementing a regeneration programme based on the Delors White Paper, and reducing working hours so that people can share them more fairly. And, lastly, the Intergovernmental Conference must give Europe a social and, above all, a political dimension.
An economic Europe which is soon to have its own single currency will really need political government by a governing body. This may be a different issue, but the fact that Europe does not have a political dimension certainly partly explains the Union's poor economic and social performance at the moment, which has brought such condemnation from the public.

Lamfalussy
Mr President, ladies and gentlemen, I have listened very carefully to what you have said, and I have learned a great deal. Although I obviously cannot reply to all the questions you raised, I should nevertheless like to say something about EMS II and unemployment, two subjects which were mentioned in almost every question.
On the subject of EMS II, I would confirm what Mr de Silguy said: that there are not one, but two objectives. One is to ensure that the single market is able to function properly. The other is to prepare the way for those who are provisionally outside the system to join the first team. What we are all wondering is whether there is really any hope that EMS II will achieve these two objectives after the serious crisis that the first EMS went through in 1992 and 1993?
My reply to this is simply that there is hope, for a number of reasons. First, do not think that the 1992-1993 crises marked the collapse of the EMS. The EMS did not collapse, though it was certainly badly shaken. But the countries which remained in the EMS experienced far less turbulence in their exchange rates than those outside the system. Second, we can learn lessons from past experience, and the proposal which is currently being discussed and which is to be completed by the end of the year rectifies every single one of the deficiencies which the EMS showed in 1992-1993. Third, the convergence process is considerably further advanced than it was at the time of the crises in 1992-1993. Fourth, there is still talk of the danger of 'asymmetric' crises. We have already had one, in the shape of German unification, but it is not something which is likely to be repeated, or at least I hope not.
Furthermore, I would point out that the danger in the past has not come from 'asymmetric' crises, but from the asymmetric nature of the reactions to them, particularly the political repercussions. Think of how chaotic the reactions were to the oil crises in the 1970s.
For all these reasons, I am confident that EMS II will work, but I would stress one vital point, which is that EMS II cannot be more than a transitional or provisional arrangement, and that the final solution to exchangerate instability is monetary union.
Finally, a few words about unemployment. In every speech I have made, I have always recognized the fundamental importance of tackling the unemployment problem. I have never concealed my concern about this, nor do I intend to do so. But I would advise you to resist the temptation to draw parallels, as some people have occasionally done, between the preparations for monetary union, or even monetary union itself, and the increase in unemployment.
If there is such a temptation, it is misleading in that it does not correspond to what actually happened. The strong upward trend in unemployment began in Europe in the 1970s and gained momentum at the beginning of the 1980s, in other words at a time when monetary union was not even on the agenda and we were a long way even from the Maastricht negotiations. I therefore feel we should analyse the seriousness of the problem as it is now, instead of drawing over-simplified parallels which are easily exploited.

President
Mr Cox has asked for the floor; since we are about to start the vote, I would ask you to very brief and take the floor only to make points of order, given that I have still to give the floor to Mr Macciotta, on behalf of the Council, and Mr de Silguy, on behalf of the Commission.

Cox
Mr President, you have anticipated the point of order I wished to make. I welcome the fact that Mr Lamfalussy has made his closing comments but I must insist that the House also hear the other institutions. We have asked direct questions and we should have direct answers before we go to vote.

Macciotta
It is rather difficult for me to answer all the individual points; I shall therefore focus on a number of general considerations. To begin with, considerations of an institutional nature: there is no question that, objectively speaking, difficulties exist in relations between the Institutions, these provoke tensions and, looking ahead, represent an obstacle to further integration: we have a communications' deficit which is resulting in a shortfall in participation and democracy. We shall have therefore to find a way of involving the European Parliament, but also the national parliaments, in the decision-taking processes of the European Community. This is not an artificial concession but a real need to which it is in all our interest to respond through the appropriate institutional changes, which are, in any case, being considered by the Intergovernmental Conference.
A few points now on the substance: the achievement of Economic and Monetary Union will help reinforce the conditions needed to give a fresh boost to economic and social development in Europe, making it more competitive in relation to the three other major economic areas in the world, and will therefore make it possible to speed up the process of creating new jobs. If that process is to be pursued in a resolute and credible manner, the priority objective of reducing levels of unemployment is both a necessary and a consistent one. I should like to say to Mr Martinez at this point that not taking part in the stable system of exchange rates is not helpful, as is clear from experience in Italy which did not devalue in order to be more competitive but experienced, in 1992 and between 1994 and 1995, sudden instability from which it is only now emerging with difficulty and determination. A stable macro-economic framework is not then of itself enough to guarantee the creation of new jobs. If we are bring down unemployment to a reasonable level, we need to take more wideranging measures, of a structural nature, designed to improve the operation of the markets, in particular the labour market. There are indispensable constraints and objectives: first and foremost the social welfare model - which, as I have already said, is an essential feature of Europe - needs to be defended and preserved but, given the changes in the age pyramid and the professional qualifications of Europe's population, if we are to do that we have to review it to make it more effective and alter the balance.
Secondly, we need to increase investment in human capital which is the most important source of wealth for our continent, by strengthening and improving education systems and vocational training. Thirdly, we need specific measures to help the less-favoured groups in society: young people, women and the long-term unemployed, to make it easier for them to join or rejoin the labour market.
The issue of employment is a priority for the European Union. The Florence European Council, to take place at the end of the week, will focus essentially on that issue, with the objective of making still more targeted and effective the strategy for combating unemployment, the broad lines of which have already been identified in earlier European Councils, beginning with the Essen European Council. The tripartite conference, convened last week in Rome by the Italian Government, showed that the broad lines of that strategy enjoy a large degree of support from the social forces. We need to increase that support because it is vital if we are to make this strategy more effective and more vigorous. Strengthening consensus, through dialogue and consultation, underpins the confidence pact for employment launched by President Santer.
We are certain that the Florence European Council will be able to give fresh impetus to the strategy of combating unemployment and that resolute implementation of that strategy will soon produce real results. Noninflationary macro-economic policies geared to stable growth are not incompatible with the aim of increasing employment: they are in fact the vital prerequisite for achieving that objective. In that context, we need also to find and apply in all of the Member States fiscal policies able to reduce pressure on earned income - a hope that has been expressed in the course of this debate. That aim is not inconsistent with the need stated in the Council resolution not to reduce, for the time being, overall fiscal pressure: we are talking about a targeted redistribution of the tax burden.
The objective we have set ourselves is difficult and requires a collective effort at all levels, but it is essential, and the future of the European Union depends on its achievement.

President
I should like to thank the President-in-Office. Commissioner de Silguy will now take the floor on behalf of the Commission.

de Silguy
Mr President, I cannot hope to reply in just a few minutes to all the questions put to me, but I should like to make two points, one about the single currency and the other about unemployment.
On the single currency, I feel we should put an end to all the doubts and misunderstandings. There is no doubt that the euro will enter circulation on 1 January 1999. Public debate on this subject has been changing over the last few weeks and months, and the question now is not whether the euro is a good idea and whether it is really going to happen, but what preparations we should make in order to obtain the maximum possible benefit from it.
To prepare for the euro, we must of course carry on with the work on convergence, as we discussed at length this morning. We also need to set up a second European Monetary System. I would refer here to what we have just heard from the Chairman of the EMI on the subject, and I would point out to Mr García that the Commission has never said that it would make payments from the Structural Funds conditional on meeting certain macroeconomic criteria. It simply said that it would agree to a request from a number of Member States to carry out a study on the subject, which is not the same thing at all.
What we must also do to prepare for the euro, and I feel this is absolutely vital, is to introduce a stability pact, because there is no point in being ready on the day if we are subsequently unable to adhere to rules of good conduct and sound management for the duration of the monetary union. I would add that the policies we pursue here must be both credible and socially acceptable. These are two very important points.
We also need to introduce statutory regulations for the euro; you should receive the Commission's proposal shortly. Such regulations are essential if we are to provide the legal security which operators, firms and the markets in general demand of us.
Finally - and this is in response to many of the questions raised this morning - we must organize an information campaign in close cooperation with Parliament to convince public opinion that the euro is necessary, and to prepare people psychologically for the changeover and reassure them about what will happen. As you can see, we have an enormous task ahead of us, but it is also a very exciting one, in that we shall now be making real preparations instead of simply asking questions.
Moving on now to employment, this is a subject to which we should devote all our energies. It is a political priority, and as such should be the focus of our concern. When the Commission presented its broad economic guidelines, I told you that they were based on three vital elements: growth, stability and employment. So I was astonished to hear the criticisms made of these guidelines, criticisms which would seem to suggest that people would prefer to have inflation and deficits, neither of which has ever created jobs, as far as I am aware. If deficits created jobs, then Europe would probably be suffering from over-employment at the moment.
The euro is another subject on which we need to eliminate misunderstandings. The euro will mean less unemployment, simply because it will mean healthier public finances. I would point out here that 40 to 50 % of budget savings go to finance public deficits, whereas the money would be much better used to promote investment and consumption, and thus to create jobs. The euro will also put an end to currency fluctuations, and on this point I share many of the concerns expressed this morning. I would point out that in 1995, currency fluctuations cost Europe half a percentage point of growth and one and a half million jobs. So here too, the euro should make a big difference to our unemployment problem.
I am quite aware that although the euro itself may be a vital element, it is still not enough on its own and further measures are needed. This is where the structural policies come in, but these are primarily the responsibility of the Member States, with Europe merely providing the leverage. President Santer's proposals to be discussed at Florence adopt this same line.
Let me just mention three other points which I feel are important, and which reply to some of the questions raised this morning. One of Mr Santer's proposals is to exploit the potential of the single market by making small and medium-sized firms more competitive. He is also proposing that the major infrastructure projects should be stepped up, and the Commission intends to stress the urgent need for the trans-European networks, because it is totally unacceptable that, four years on from the Essen summit, the funding for these is available but has still not been released. There are also proposals for reforming the employment systems, and although the main burden here again rests with the Member States, the Union can still act as a very useful lever.
The measures we are taking are thus coherent, comprehensive and carefully thought out, and they need firm support if we are to restore confidence and return to growth.

President
Thank you, Commissioner.
The debate is closed.
The vote will take place tomorrow at 12 noon.

Votes
Desama
Madam President, since Parliament has, as was to be expected, rejected Amendment No 1, I should like to call on all my colleagues in the House to support Amendment No 5, tabled by the Union for Europe Group, since we shall then at least signal a certain amount of willingness on the part of Parliament to move in the direction wished by Mr Macartney.

Macartney
Madam President, as rapporteur I wish to say how disappointed I am at the vote on Amendment No 1 and I think this House will have cause to feel ashamed about that. As a fall back, at least we can adopt Amendment No 5, which puts in the word 'substantial' which has no legal force. But at least let us put it in. So I support Amendment No 5, although it is very much weaker and this House has just made a fool of itself.
(The President declared the common position adopted as amended)

Cornelissen
Madam President, I have a comment to make about the voting order. It seems logical to me to have the vote on the two amendments tabled by the Committee on Transport and Tourism, Nos 59 and 60, before Nos 64 and 65, in view of the substance of the amendments and the fact that the Committee on Transport and Tourism feels that they go further.
I would ask all Members who think we need to find a solution to the backlog to take another close look at Amendments Nos 59 and 60.

Desama
Madam President, the amendments by the Committee on Transport and Tourism certainly do not depart further from the text than the others, since they do no more than restore the Commission's original wording.
(In successive votes, Parliament adopted the two legislative resolutions)

Gasòliba i Böhm
Madam President, I should just like to thank the members of the Committee on Economic and Monetary Affairs and Industrial Policy for their support in drawing up this report, and especially for their valuable contributions in the discussions in committee.
I think we can vote on the report and the amendment together - given that there are no other amendments - but I should like to clarify the following technical point. We accepted Mrs Randzio-Plath's amendment to paragraph 10 in committee, but the second part of that paragraph - referring to the role of the EMI - has been left in by mistake.
Consequently, we should vote on the report and amendment together, but we should not vote on the second part of the paragraph in question.
That will leave us with the following:
'Stresses the need for a balanced policy mix' .
(FR) We therefore do not need to vote on the second part of this paragraph.

Thyssen
Madam President, I think our translators do an excellent job, but on this occasion I would like to ask for the Dutch version of the report by Mr Gasòliba to be revised again. There are four translation errors, all stemming from the same problem. 'Fiscal policy' is translated as 'fiscaal beleid ' instead of 'begrotingsbeleid ' . And 'fiscal consolidation' is wrongly translated in three places as 'fiscale consolidatie ' . This is not the first time this mistake has occurred, so I suggest that not only should this report be checked again, but that the problem should also be brought to the attention of the translation service, so that they know that 'fiscal' in English can be translated in two different ways in Dutch.

President
Thank you, Mrs Thyssen. We shall not only make the corrections, but ensure that these mistakes do not occur again in future.
(Since no Members opposed the tabling of the oral amendment, the President put it to the vote)
(Parliament adopted the resolution)

Ahern
This is an excellent report which proposed to make a concrete difference by its proposal for energy efficiency which in helping to reduce carbon dioxide emissions also addresses climate change.
The Green Group supports all the amendments by the rapporteur and I agree with Mr Macartney that it is a shameful day when this Parliament cannot take direct concrete action on a simple, straightforward issue like energy saving.
Linkohr report
Holm
I cannot support the EU investing a great deal of money in research which is not in line with the Greens' proposals. The research includes aerospace research, as the text states that air traffic will double within the next 15 years. Flying is not an environmentally friendly form of transport. More resources should rather be made available for research in the fast train industry. It is true that this is also included in the proposal but I would like to increase its share considerably.
There are many areas and objectives that I approve of, however, and I support the amendments, for example the reduction of the appropriation for nuclear safety by ECU 10 million. Unfortunately, experience shows that this money contributes to the continued use of nuclear energy and gives the impression, in the Eastern European countries as well as elsewhere, that nuclear power is safe. Nuclear power is not safe and we should instead invest money in renewable sources of energy in order to get away from nuclear power.
I am voting against Amendments Nos 50 and 51 because they do not take money away from Euratom. I support Amendments Nos 55-57 because they ensure that Euratom money goes into support for renewable sources of energy.

Malerba
On the occasion of the refinancing of the Fourth Framework Programme, Commissioner Cresson has altered the political objective of European research for integration and cohesion and geared it to new purposes:
support for the international competitiveness of European industry; - making the subject-matter of research comprehensible to Europe's citizens; and - bringing together national and Community endeavours.The rapporteur, Mr Linkohr, was quite right to take up the three issues he considered, but looking beyond those particular issues and the priorities relevant to each, it seems to me that, on the occasion of this all too short debate, Parliament should give an early signal to the Commission concerning the approach to be taken in the Fifth Framework Programme. I would like to suggest that we use this opportunity to take a further step forward by earmarking a percentage of the total budget for projects involving a technological challenge, the so-called 'challenge-led' projects.
A 'challenge-led' project is characterized by:
a high risk, such that it cannot be carried out at national level; - the possibility of triggering a multi-disciplinary approach and international cooperation (in the context of which it is Europe's interest to speak with one voice); - a real technological challenge - the breakthrough, when it comes, bringing with it substantial economic or social benefit.A 'challenge-led' project does not integrate existing technologies. Examples of challenge - but these are examples only - are:
the magnetic-levitation train or superconductor electric cable; - the super-efficient battery (all renewable energy technologies are limited by the problem of batteries); - vaccines which prevent illness: they are ruining the pharmaceutical companies but require major investment.Parliament and the Commission should start thinking now about the most important technological challenges - selecting one or more topics - and, in the context of the Fifth Framework Programme, adequate European resources should be earmarked for them, to ensure that specific programmes are viable and have a clear European profile. The Commission should not drag its feet, content to do only what it is well-equipped and knows how to do. If we want to keep pace with innovation, we must be prepared continually to re-invent ourselves.
It is good to have the task forces for the time being!

Vaz da Silva
Strengthening the funding of the 4th Framework Programme for technological research and development, in effect since 1994, together with as assessment of its activities, is of capital importance for guaranteeing Europe's competitiveness.
But I must point out that the area of technological R&D is particularly important for countries like Portugal.
By introducing the notion of task forces, interesting in fact in terms of principles, the Commission has somehow undermined the balance struck when defining the 4th FP. By banking on major applied research projects it runs the risk of harming cohesion, preventing the less developed countries from taking part actively, even though they want and need to take part for the whole Union's good.
All Member States must have a voice in defining the future task forces but it is also important that the priorities already defined in the 4th Programme should continue to be taken into account.
I agree with the rapporteur's proposal to concentrate priorities or focus on such basic areas as educational multimedia and hydraulic resources.
Educational multimedia is the perfect Trojan horse for stating European identity and the European Union must accept this and draw the necessary consequences.
The introduction of the new area of research on landmines deserves my full support. I am well versed in this problem since in Portugal's brother states, Angola and Mozambique landmines are still a scourge claiming countless lives among the younger generations in those Portuguese-speaking countries with so much to offer the future of our society.
I back the amendments referring to the multimedia priority but must stress that only the budgetary increase proposed by the Committee on Culture will make them operational. I back all the amendments referring to concentrating priorities, the amendment on mines and the amendment calling for better and more permanent interdepartmental interaction.

Wolf
We Greens believe that a key element of any sound economic policy in the future is effective support for research which is not thrown off course by cyclical pressure for cuts, but in fact lays the foundations for future progress in an anti-cyclical way, at the very time when the economic cycle indicates that the innovations made have been exhausted.
We therefore particularly regret that the proposed increase in resources for the fourth framework programme, which we shall support whenever we have the opportunity, has once again been inextricably linked to unacceptable changes in direction which will hamper and obstruct future developments, rather than facilitating them. These decisions include the funding for Euratom, for research into fusion and aeronautics - which might be of use 50 years from now, if ever - as well as the one-sided concentration on research carried out by large industry and the reckless determination to pursue biotechnological research without adequate risk surveillance.
We regret this, and call on Parliament to devise a procedure for similar decisions in the future which enables us and others to make our criticisms of substance in an appropriate way, without at the same time having to reject the EU's whole research policy.
Sindal report
Le Rachinel
Madam President, ladies and gentlemen, the main concern of this report is to make sea transport more flexible and attractive. There is a need to give a greater role to this mode of transport, so as to relieve pressure on the others.
However, various problems and shortcomings have come to light in the course of examining of this report, especially as regards environmental protection and safety standards. Indeed, the vessels employed in short sea shipping are particularly small and dilapidated. The risks of an accident are therefore greater.
We must now take all these factors into account, with a view to making short sea shipping a mode of transport which is environmentally friendly and safe.

Howitt
Madam President, in commenting on the Sindal report, I very much welcome the plans contained for a switch of 30 to 40 % of trade between Spain and Britain from the roads to short-sea maritime transport. It will be good for the environment, take 0.6 million tonnes of trade off our roads and it will be six times more efficient in terms of energy usage and reducing carbon dioxide emissions.
I rise in support particularly to plead to the Commission that it ensures that the port of Tilbury in my constituency is at the heart of this new increased trade. It is a port which is close to London and the major transport networks from the south-east of England to the whole of the United Kingdom. It has an unmatched range of flexible facilities. Recently it has announced a fast, daily container service to Rotterdam. It has the potential to benefit from this increased trade and I ask the Commission to ensure that it does so.

Langenhagen
After months of intensive work, Mr Sindal's report is now ready for adoption by the House and, despite some criticisms, I should like to congratulate him on behalf of my group.
An intensification of coastal shipping should have positive economic effects and a dynamic impact on employment in the coastal regions of the European Union, and above all in the least developed of them:
the necessary modernization of the fleet will revive the European shipbuilding industry, thereby preserving or even creating jobs in coastal regions; -moreover, an increase in the volume of turnover should result, and this will be of benefit to small and mediumsized ports as well as large seaports; -finally, an intensification of short sea shipping will above all benefit small and medium-sized firms in the maritime transport sector: it is mainly small shipping companies which are involved in the cargo sector, and a large percentage of the jobs on board vessels flying EU flags are concentrated in the short sea shipping sector.The Sindal report acknowledges that an intensification of coastal shipping must go hand in hand with a good deal of modernization, both of the fleet itself and of ports and their connections with the hinterland. At the same time, the text comes out in favour of free competition, which is generally to be welcomed, but against any aid measures, whether direct or indirect.
This appears, at least to those of my colleagues who were actively involved in drafting the opinion on the Sindal report in the Committee on Regional Policy, to be somewhat at odds with the reality in many coastal regions.
The Committee on Transport would therefore have been well advised to devote rather more attention to that committee's proposals, which were adopted with the strong backing of the PPE Group and the support of the socialist Members.
Because - and here I have three questions to those present - is there any such thing as 'fair' competition between prosperous and less-developed coastal regions, or between large and small ports?
Can it really be said that some individual Member States or regional and local authorities, for example in Objective 1 regions, have as much budgetary scope for the necessary modernization work as their more prosperous counterparts?
Was it taken into account that coastal shipping offers major development prospects in regional and planning terms, particularly in the Atlantic and Mediterranean areas, as demonstrated by the case studies for the planning document 'Europe 2000+' ?
More account should be taken in future of such imbalances and different geographical circumstances, especially in the context of transport policy. After all, economic and social cohesion is one of the fundamental objectives of the European Union: the individual Community policies are committed to supporting this goal, and there is a broad consensus in the groups as to its importance.
Finally, I have two further comments in support of a coherent European transport policy, as called for by most of the political groups:
it would have promoted safety on the high seas and the protection of coastal regions, which are of ecological importance as both residential and economic areas, if specific research or training measures had been called for in this sector: new, safe types of vessels and their handling, as well as portside logistical support for navigation, create a need here for accompanying measures; -lastly, it is strange, in view of the conciliation procedure currently under way concerning the trans-European transport networks, that the motion for a resolution fails to reiterate Parliament's appeal for short sea shipping to be included in the TEN guidelines.
Theonas
Marine transport, and specifically short sea shipping, has long been deprived of a proper level of attention from the European Union and the Member States, chiefly because of pressure from big monopolies whose prime interest is the growth of road haulage.
However, the development of short sea shipping via the improvement of infrastructures and ports and the establishment of multimodal links aimed towards combined marine and land transport, renewal of the fleet and the maintenance of a high level of safety would allow the comparative advantages of marine transport to be fully exploited and lead to lower transport costs, to an increase in the carriage of goods and passengers by sea and, most importantly, to a reduction of the pollution caused by road transport.
The constant growth in the volume of freight, growth which has become very rapid because of the internal market and the World Trade Organization agreements, makes it imperative to look for a different approach to transport and for priority to be given to marine and rail transport which are much more efficient and use much less energy per kilometre/tonne.
The promotion of short sea shipping could be particularly beneficial to the coastal and island regions on the periphery of the Union, especially those in Greece which have thousands of kilometres of coastline and numerous islands, which are currently beset by infrastructure weaknesses, a lack of regular transport links and an incapacity to develop productive activities and to achieve adequate levels of supply because of transport costs.
Furthermore, development of this transport sector, renewal of the fleet and adherence to the most stringent safety regulations for workers, passengers and freight, will ease the crisis in the Community's shipbuilding and ship repair industry, especially in less-developed countries on the periphery, such as Greece.
Special attention must be paid to the need for consolidation and extension of the social rights of seafarers, for improved health and safety conditions, wages and working conditions, for accident prevention measures and for the safeguarding of seafarers' insurance and pension rights.
The expansion of short sea shipping will require specific national planning within the framework of the overall organization of national transport modes, development of the requisite infrastructures, the deployment of financial incentives and disincentives and the application of legislative and administrative measures to create a climate which will divert investment away from its current orientation and towards short sea shipping.
Unfortunately, however, the benefits can only be realized if the European Union is prepared to re-examine this present directive - which really ought to be scrapped - and to think again about the liberalization of cabotage. Far from strengthening short sea shipping, this is likely to lead to a further worsening of the current level of services and to the creation of new problems, particularly for the island and more remote regions.
Promotion of national planning will permit wider planning of the development and exploitation of short sea shipping at the European level and facilitate the growth of the sector, the maintenance and expansion of employment, development of the island and coastal regions and protection of the environment.

van Dijk
The Greens have voted in favour of the Sindal report. In comparison with rail and air transport, short sea shipping uses very little energy and is therefore less damaging to the environment. The geography of Europe being as it is, with its many coastlines, short sea shipping could and should be much more widely used, which makes it even more incomprehensible that it does not form part of the TENs, a situation which should be remedied immediately.
My group has drawn attention to the rather surprising comparison made between road and rail transport in recital A and paragraph 6. These two are by no means developed and subsidized to the same extent.
There is a risk that the poor working conditions in short sea shipping will be used as an excuse to bring further pressure to bear on working conditions in land transport, and for this reason I would again stress the importance of paragraph 19.
Finally, my group was unable to support Mr Wijsenbeek's amendment, which would have reopened the debate on weights and dimensions.
We were delighted to give our support to Amendment No 2, which is an excellent example of how short sea shipping and inland navigation can be combined.
Gasòliba i Böhm report
Holm
I agree with the criticism in the report concerning the late arrival of the annual report and believe, like Mr Gasòliba i Böhm, that the Monetary Institute should submit regular interim reports to the EU Parliament and others. This is because the issue is one of the most important in the EU and one which affects all citizens of the Union.
What I miss in the annual report is a proper analysis of how the policy being pursued affects ordinary people, as regards such things as the coordination of Member States' monetary policy, budget consolidation and the transition to EMU as a whole. The annual report should also get away from the usual economic terminology and be easier for ordinary people to read, explaining simply what the Institute is doing and how it affects the man or woman in the street.
I oppose the introduction of a common currency in view of all the negative effects it will have. My goal of an ecologically sustainable society is not compatible with EMU.
In view of the above I am voting against the report in the final vote.

Kirsten Jensen, Blak and Sindal
Referring to the national compromise and the Edinburgh agreement, the Danish social democrats naturally cannot support those elements of this report which run counter to Denmark's four reservations.
Pérez Royo report
Holm
I am voting against all of this report by Mr Pérez Royo because it includes so much that I cannot support. It is primarily a question of the views expressed which pay homage to a common currency and the need for progress in the convergence process.
On the other hand, I support the idea of a tax on currency transactions because it would reduce speculation considerably. Such a tax should be introduced by countries outside the EU as well as the EU Member States. The tax should, however, not be seen as a stage in the process leading to the introduction of the common currency; rather it should be introduced simply in order to reduce speculation.
I find the totally uncritical praise of EMU, the convergence criteria and the schedule for those criteria totally incomprehensible. I am not against the national economies of the Member States being put in order but the cuts which are now resulting from the convergence policy should give cause for reconsideration. Rather than simply thinking in terms of the traditional economic objectives it is necessary to consider the new economic policy, the aim of which is an ecologically sustainable society. This objective is not compatible with the EMU project which must therefore be stopped.

Kirsten Jensen, Blak and Sindal
Referring to the national compromise and the Edinburgh agreement, the Danish social democrats naturally cannot support those elements of this report which run counter to Denmark's four reservations.

Lindholm, Schörling
Although it contains a number of good proposals, such as the tax on currency transactions, we are voting against the report because we are against the entire EMU project.

Wibe
The report contains many good proposals, for example in paragraph 4, which states that a tax on currency speculation would be an effective way of stabilising exchange rates. I am nevertheless abstaining because so many paragraphs of the report recommend completion of monetary union and the establishment of a new ERM.
I believe that a new exchange rate mechanism will encourage speculation and could result in the same kind of economic disaster we experienced in 1992. I also believe that completion of monetary union at a time when the Union has almost 20 million unemployed is an economic gamble which could seriously backfire both socially and economically. This is why I have chosen to abstain.
von Wogau report
Schörling
Madam President, it is remarkable that in different contexts - including the reports which have already been debated today and the Von Wogau report - it is stated that there is a broad consensus in favour of EMU and the main principles involved in the introduction of the common currency, including an exchange rate mechanism. However, there can be no-one who does not know that outside the EU institutions there is considerable doubt about the splendid qualities of EMU, the schedule for EMU and the convergence criteria. This criticism comes from politicians, economists, bankers and trades unionists. Demonstrations in Belgium, France and Germany bear indisputable witness to the social unrest which the convergence criteria are causing among ordinary people.
Naturally all countries must make every effort to pursue sound economic policies. However, this requires healthy development, not constant growth which adds to the growing environmental deficit. It also requires fair distribution of common resources and policies which prevent social exclusion and unemployment. With EMU, however, the EU has established an economic policy which puts price stability and balanced budgets above all else, which may entail cuts in public services and cause many more jobs to disappear.
From a democratic point of view the European Central Bank is unacceptable. The Von Wogau report speaks of accountability but the truth is that it is impossible to impose accountability on the decision-makers. The six members of the European Central Bank's board cannot be removed in the course of the eight years for which they have been appointed. EMU is to be administered by experts over whom no political control will be possible.
Economic and monetary union thus faces far too many unsolved problems and risks becoming a political owngoal, far removed from the real world and economic realities.

Ahlqvist, Theorin and Wibe
As the idea of an economic and monetary union is basically a federal one and conflicts with our belief in the creation of a Europe of democracies, we will abstain from voting on this report. Allowing monetary policy to be determined by officials at the European Central Bank is not in accordance with our view that economic policy should be governed by the people through their elected representatives.
On a separate point, it may be noted that during the membership negotiations Sweden made a unilateral declaration that we would decide for ourselves whether we would participate in EMU or not. The legal validity of this declaration is doubtful but the political view is that it is the Swedish people who will decide on EMU membership. As far as Sweden is concerned the matter has by no means been decided.

Holm
As an opponent of the entire EMU project I am voting against this report by Mr Von Wogau. There are some good amendments, which I support, but they do not outweigh all the less satisfactory parts of the report which remain.
I do not support the establishment of an exchange rate mechanism for the common currency in the present situation. Each country must bear responsibility for and be able to pursue its own economic policy, which takes into account the conditions in that particular country and the country's industrial structure. This will be made impossible by participation in EMU. It is naturally desirable that exchange rates fluctuate as little as possible. This is not only true with regard to the EU's Member States, however, but also with regard to those countries outside the Union, of which there are far more.
The report is permeated by the demand that the convergence criteria should be implemented. In view of the massive cuts which many of the EU Member States are now being forced to make or will make, there should be some pause for thought. Rather than fostering the expansion of social welfare EMU policy is now resulting in the dismantling of the welfare system in country after country. This is not a policy I can support.

Lindholm
As I oppose the entire EMU project I am voting against the Von Wogau report.

Poisson
I followed the debates this morning carefully. At no point was there any mention of the fears of the citizens of the Member States with regard to the single currency.
Our political leaders, the Commission in Brussels, deliberately encourage confusion between a single currency and a common currency. Clearly, the people of Europe find it hard to tell the difference. For example, if you talk to French people about a European currency, or indeed a single currency, they think you mean a common currency, and seem to be in favour of it. But if you clearly explain to them what is at stake, they are against it. When they realize that the introduction of the euro will mean the disappearance of their national currency, they oppose it - and they are right. Why?
The people of Europe have a deep emotional, psychological and practical attachment to their national currencies. Depriving them of a reference point as essential as their national currency would undermine them psychologically. In the words of General de Gaulle, the currency links the citizen to the nation.
I voted against the von Wogau report because, as a convinced European, I believe that Europe must not be built on a massive lie.

Voggenhuber
Since Maastricht, there has been a growing suspicion on the part of people in Europe that partisan economic interests are increasingly taking hold of the process of building Europe.
In this crisis of credibility in the EU, those who had been relying on the monitoring and corrective powers of the European Parliament have been deeply disappointed for months now. It is becoming increasingly apparent that the convergence criteria for monetary union are a vehicle for the destruction of welfare standards in the Member States. The pressure to achieve the criteria simultaneously and as soon as possible has begun to have a recessionary effect and is leading to a sharp increase in unemployment.
Yet people in the European Union are waiting in vain for the EU institutions to reform these criteria, which have long since become socially irresponsible. A few days ago the President of the Commission, Jacques Santer, drew attention once again to the Member States' responsibility for pursuing an active policy on employment, but he cynically failed to mention that these EMU convergence criteria are precisely what has eliminated the necessary political room for manoeuvre.
This inconsistency is heightened by the lack of any social initiatives at European level. In view of this policy, which is severely disrupting the social peace in Europe, it is the duty of the European Parliament to speak out strongly in favour of the development of a social and ecological Union, and against a policy of stultifying economic liberalism.

President
That concludes voting time.
(The sitting was suspended at 1.12 p.m. and resumed at 3 p.m.)

Fisheries
President
The next item is the joint debate on the following reports:
A4-0189/96 by Mrs Péry, on behalf of the Committee on Fisheries, on the communication from the Commission to the Council and the European Parliament (COM(94)0335 - C4-0086/94) on the crisis in the Community's fishing industry; -A4-0133/96 by Mr Arias Cañete, on behalf of the Committee on Fisheries, on the problems of the fisheries sector in the NAFO zone; -A4-0172/96 by Mr Arias Cañete, on behalf of the Committee on Fisheries, on the amended proposal for a Council Regulation (COM(96)0117 - C4-0299/96-95/0252(CNS)) laying down certain conservation and control measures in the Antarctic; -A4-0169/96 by Mr Kofoed, on behalf of the Committee on Fisheries, on the proposal for a Council Regulation (COM(95)0670 - C4-0033/96-95/0338(CNS)) amending for the sixth time Regulation (EEC) No 1866/86 laying down certain technical measures for the conservation of fishery resources in the waters of the Baltic Sea, the Belts and the Sound.
Péry
Mr President, ladies and gentlemen, we are debating the crisis in the Community's fishing industry. This economic, social and ecological crisis is affecting the entire sector. For a number of years now, we have been obliged to cut back on catch authorizations, apply more effective controls, reduce fleet sizes and step up structural and social accompanying measures. At the same time, although the amounts of fish caught have decreased - in my own country, for example - many species have suffered the effects of international market forces. In certain regions of Europe, fresh fish prices have fallen by an average of 25 %.
' Blue Europe' is a fragile common policy because it is incomplete. All Europe's coastal regions are looking to the future with concern. That is why I felt it essential to begin this report by calling on the Commission and the Council to map out some clear prospects and to show a willingness to ensure a maritime future for the countries of the Union. By chance, Commissioner, our respective timetables meant that we learnt your response a few days after this report went to print and after our seminar in Quimper. Consequently, our committee has not yet been able to debate the fourth multiannual guidance plan which you are submitting. Certainly, we were expecting a message of vision, but we were also expecting one of confidence. However, seeking to reduce fishing opportunities by an average of 40 % in five years will, as you well know, not only mean the scrapping of large numbers of vessels, but also lead to the certain death of several ports which are already heavily in debt as a result of their efforts to modernize. This is a very hard blow to the economic and social activity of the whole sector.
I am convinced that we must now display not only vigilance and firmness, but also imagination and political will as regards a number of new proposals which are capable of restoring confidence to the sector. I shall restrict myself to dealing with three key points, concerning resources, the markets and structural policies.
As far as resources are concerned, we are aware that sacrifices will still have to be made. So let us adopt stricter technical measures which genuinely make it possible for resources to be renewed. We refer in the report to the use of square meshes and more selective fishing gear, and to the protection of zones in which juveniles are concentrated. We propose the introduction of biological rest periods when species are particularly under threat. However, Commissioner, the Fisheries Committee also refers to the need for financial compensation.
The Commission's reply will be that the common fisheries policy does not provide for this type of funding, save in very exceptional cases. 'No support for incomes' , you will say. I do not believe that I make populist speeches very often: I will not conceal the difficulties, but I cannot accept that the sacrifices should be one-sided. If we have the money to compensate for the destruction of a vessel, then we should also be able to find the money to conserve resources.
In order to produce maximum effect, all these technical measures must be underpinned by constant and increasingly in-depth scientific research and far more rigorous controls. Hence it is essential not only to encourage those directly involved in the sector to assume their responsibilities, but also to equip ourselves with new means of surveillance.
I know that I am wrong to put forward ideas which are not financially neutral, Commissioner, but this will allow us to gauge if there is a genuine political will in the European Union and its Member States to maintain a competitive European fisheries sector.
With regard to the markets, I should like to point out firstly that the internal European fisheries market is heavily dependent on imports, both for consumption and supply to the processing industry. When the common fisheries policy was launched, the creation of a free market, a market which is open to international competition, was the choice that was made; and the crisis has affected the markets, the auctions and the distribution sectors. The industry as a whole must improve its systems of information and communication. The modernizing of the industry is vital in today's world. We also believe that it is important to involve producers more closely in the distribution sector, as well as to exploit the quality and the origin of fisheries products.
However, Commissioner, I do not believe that the 'blue Europe' of 2002 will be able to make do with such a weak 'market' aspect. I am firmly convinced that it will be necessary to establish a more binding Community framework - compulsory withdrawal prices, preference prices which are better respected - and to put in place a financial instrument to help fresh fish producers' organizations in times of serious crisis and when there is a collapse in market prices. Here too, I know that you will say: ' But that is a form of income support!' I would reply that when the market fails to perform its function, support measures are required, especially in view of the fact that only 2 % of the Union's fisheries budget is devoted to price support.
Time will not allow me to elaborate on my third key point, which relates to structural policies. This is undoubtedly the aspect of the common fisheries policy for which the Member States and the Union have provided themselves with the most extensive resources - and so much the better - through the Financial Instrument for Fisheries Guidance and the PESCA programme, which we wish to see implemented as a genuine 'SEA LEADER' . We also give our backing to your achievements in respect of early retirement measures - although we wish that the Member States would play the game too, when they know that the Union is already co-financing these measures by up to 50 %. This social dimension cannot be passed over in silence: it exists and must be adequately supported.
I have already overrun my speaking time, Commissioner. I would simply say, in conclusion, that we shall be equal to the task in terms of vigilance and firmness. We shall need courage too, but we shall discuss this guidance plan again. To my mind, it is unacceptable, both with regard to production and the sector as a whole; we must take more imaginative measures, and certainly give more financial support.

Arias Cañete
Mr President, ladies and gentlemen, I should firstly like to present the European Parliament's own-initiative report on the situation of the Community fleet in the NAFO zone and, within this context, fisheries relations between the European Union and Canada.
It is well known that since the creation of NAFO in 1978, the European Union's fisheries relations with Canada have passed through times of extreme tension. These relations, especially since 1984, have been characterized by regular clashes over fishing rights in the waters of the North Atlantic. One of the clearest examples of this - as pointed out by Professor Mallou - is Canada's achievement in fixing the cod TAC in division 3NO at zero for the years 1995 and 1996, without any sound scientific data.
The most recent fisheries conflict between the European Union and Canada - and unfortunately the one which perhaps gained the most international attention - was that popularly known as the 'Halibut War' . The facts are well known to everyone, but perhaps now is the time - with the benefit of distance - to examine in depth the reasons which led to this conflict. Firstly, we must look back to the meeting of the NAFO Fisheries Commission of February 1995, when a TAC of 27 000 tonnes of Greenland halibut was distributed, only 3400 tonnes of which was allocated to the Community fleet, whilst 16 300 tonnes was reserved for Canada. Parliament expressed its regret in a resolution at the action of the Community delegation, since for the first time a TAC had been established at a level lower than that recommended by the NAFO Scientific Committee, which had proposed an indicative limit of 40 000 tonnes.
Furthermore, it should be remembered that in 1994, the Canadian Parliament unilaterally adopted a law on the protection of coastal fishing waters, granting powers of control beyond the 200-mile limit. This law was subsequently invoked as the legal basis for making unjustified seizures.
A number of conclusions can be drawn from what I have described. The first, and Parliament has already criticized this fact, is that the European Union is inadequately represented in NAFO, both in the Scientific Committee - whose composition is extremely unbalanced, since Canada has far more representatives than any other country - and in the Fisheries Commission. In NAFO, as in other international fisheries organizations, there is the problem of the weakness of the European Union, which despite the fact that it represents many states, has only one vote. This is an objective problem to which attention must be drawn: the stronger the European Union becomes, as new members join, the weaker it becomes in certain international organizations, because it only has one vote.
Secondly, Parliament believes that there is a lack of a genuine Community policy of scientific research within NAFO, and there have been cases in which zero TACs have been adopted without adequate scientific data being provided and without the European Union being able to respond.
Thirdly, the Canadian legislation which allows the authorities to carry out controls and seizures outside the country's territorial waters continues to remain in force, despite the fact that, following the events which unfolded after the seizure of the 'Estai' , the NAFO mutual inspection programme, which sets out the obligations of the contracting parties as regards inspection and surveillance, was modified substantially and at great budgetary cost.
Notwithstanding these controversial issues, Parliament takes the view that the prime objective, both for the European Union and for Canada, must be to avoid future clashes and take advantage of the welcome conclusion of the bilateral agreement of April 1995 in order to launch a new phase of understanding and cooperation. However, there are difficulties which it will not be easy to overcome: firstly, Canada's retention of its unilateral legislation; and, secondly, the fact that the bilateral agreement which was negotiated with great difficulty in 1992 - and which Parliament supported, with considerable reservations, because it realized that there was a need for an effort of rapprochement - has still not been ratified by Canada. This creates a serious obstacle at a time when the drawing-up of a comprehensive action plan is being considered, as the Council of Ministers has made clear. Consequently, the fact that Canada has softened its hostile attitude with a measure limited to opening up its ports is not, in our view, enough to allow a comprehensive framework of normal relations to be established.
We believe that the Community must endeavour to improve these relations, while always remembering that the defence of the Community's fishing opportunities must be a cornerstone of Community action, and that international relations need to be based on the principles of equality, cooperation and solidarity.
We feel that the agreement on the conservation and management of transzonal fish populations which was adopted on 4 August 1995 in New York will provide a useful framework for improving the situation, as long as it is implemented in an intelligent and balanced way. We trust in the Commissioner's ability to ensure that this is so, and that the agreement is ratified in circumstances which make it possible to achieve stability in the Union's fisheries relations with Canada, so that the incidents of the past are forgotten once and for all, and we can cooperate as the friends we are in a rational and normal commercial environment.
I now have the honour of presenting, on behalf of the Fisheries Committee, the report on conservation measures in the Antarctic. This report was adopted unanimously by our committee, since the aim of the Commission proposal is to amend the legal provisions in force, clarifying the existing regulation, the clarity of which has undoubtedly been diminished by repeated modifications.
Similarly, the proposal seeks to incorporate into Community legislation the provisions adopted by the Commission for the Conservation of Antarctic Marine Living Resources at its meetings in Hobart of 8 November 1994 and 3 November 1995.
Finally, it sets out, in a Community act, the commitments entered into by the Community as a result of its accession to the Convention on the Conservation of Antarctic Marine Living Resources by virtue of the Council decision of 1981.
Our committee approves the Commission proposal unanimously, but wishes to make a number of observations in this context. Firstly, once again, it is to be regretted that Parliament was consulted by the Council by means of the letter of 4 December 1995 - seven months, that is, after a number of the proposal's provisions were due to enter in force for all the contracting parties. In these circumstances, the consultation of Parliament was clearly an absolutely pointless and symbolic exercise, highlighting the need to continue working together to improve the existing procedures, so that Parliament can deliver its opinion in good time and before provisions enter into legal force.
With a view to the future, therefore, the Committee on Fisheries has drawn up an amendment whereby the Commission will be required to inform the European Parliament in advance of the changes it intends to make to the regulation and of the measures taken in order to implement the recommendations adopted by the Commission for the Conservation of Antarctic Marine Living Resources.
Secondly, the Committee on Fisheries believes that the ecological balance of the Antarctic - a wilderness which remains virtually unexploited - must be preserved as far as possible. To this end, we are calling for a report to be drawn up - if budgetary resources allow - on the impact of catches on marine and bird species in the area, as well as requesting the submission of an annual report on the assessment of fishing activities in the Antarctic and the strengthening of surveillance measures.
With these comments, the Committee on Fisheries, as I said before, approves the Commission proposal unanimously.

Kofoed
Mr President, ladies and gentlemen, the purpose of establishing the International Baltic Sea Fishery Commission in 1974 was to create an institution in which the countries bordering the Baltic Sea could jointly take responsibility for the management of fishery resources in those waters. Its decisions were to be based on advice from biologists, with the countries' own biologists also taking part in the IBSFC. This form of cooperation has worked extremely well, though there were some difficulties during the communist regimes in the Baltic States and Poland. Conservation policy has been based on the usual principles: an assessment of catches and the state of juvenile stocks, with quotas being allocated accordingly to the various countries. In addition, of course, there are the other technical measures such as mesh size and so on.
The report which is before the House today concerns the approval or rejection of a decision which was taken last year and applies to 1996. In its report, the Committee on Fisheries criticizes the fact that we are being consulted so late in the day. I hope that the Commissioner will try to ensure in future that these decisions are forwarded to us somewhat earlier. It would also be a good idea if the Commission were to invite some members of the Committee on Fisheries as observers to the preliminary negotiations which begin in Warsaw in September. It is naturally not the task of the European Parliament to act as an administrator, but in our consultative role this would surely be a good idea, because Parliament could then have a better basis on which to take the proper legislative decision in due course.
In my report, there are one or two proposals for the forthcoming negotiations in the IBSFC. What I have tabled in the report are amendments for the future. Amongst other things, they seek to introduce conservation measures which are different from those used in the past. Thus I am proposing the introduction of a limit on the engine power of vessels, such as 400 horsepower for vessels fishing cod and salmon. The reason why I am making the proposal now is that the Commission should be aware that Poland, the Baltic States and Russia are in the process of modernizing their fleets. If these fleets are modernized to include large vessels which are too effective, it will not be possible for fish stocks in the Baltic to be maintained. I am also proposing this because the fisheries policy which has been pursued in the Baltic Sea has not produced an increase in fishery resources. The stocks of cod, for example, are even lower than they were in 1984.
I also have something to say as regards the quota policy. This involves a mass of control measures, imposes constraints on fishermen and criminalizes fisheries to some extent. It is also impossible to produce correct figures on what is not being fished, on what is not being reported under the quotas, so we have no idea how much we are talking about, and the biologists' models for what quotas should be adopted in the future will not be correct either. I am therefore proposing that a limit on engine power should be introduced, and if people want to have quotas, then give the large vessels quotas for a certain period and a certain quantity, and let all the other boats under 400 horsepower fish without quotas. I think I can promise the Commissioner that fish stocks would not fall, but on the contrary would increase. In this way, the wind and the weather would have an effect on when fishing took place, as opposed to now, when the big vessels fish in all weathers. So the fish are never left in peace in these areas.
Furthermore, as a suggestion to the Commission, some of the areas should perhaps be protected during the spawning period, so that there is no fishing at that time. If you are a hunter, you do not hunt game during the breeding season, and the same principle should in fact be introduced in fisheries.
Finally, I should like to say that I hope we can have a debate on how this instrument can be applied. I am not a supporter of quotas, because they criminalize fishermen, even if the aim of conserving fishery resources is a very good one. So I do not think that our fisheries policy should be based on the Machiavellian idea that the end justifies the means. The means cannot be to turn people into criminals.
I should like to thank the Commission and the members of the Committee on Fisheries for their cooperation.

Baldarelli
Mr President, today's debate is an important one and one reason for this is that, on three different issues, we have had the impression - and, I believe, concrete proof - that our own Committee on Fisheries has proposals of its own, having drawn up specific documents and had, for some time now, the real technical capacity to tackle proposals relating to reform of the common fisheries policy.
Well then, Mr President, we need reform of the common fisheries policy, and are very much persuaded that the texts that have been submitted represent a step in that direction. We are hoping for a reform that takes account of new environmental balances, that seeks to retain employment in the sector and also takes account of the capacity needed to meet consumer requirements. The Socialist Group will be tabling its own text officially, on Thursday, in this Chamber. We would take this opportunity to invite the representatives of the Commission to take part in our initiative here, in Strasbourg, on Thursday.
The document put forward by Mrs Péry is a very important one, the product of the substantial experience she has gained in this sector. It in fact contains a number of very important and innovative elements: firstly, as I said a few moments ago, the fisheries sector must take account of environmental balances but it must also be able to retain an adequate market position. Production and market have therefore to be substantially integrated, and that can be achieved through technological innovation and the capacity to be able to handle increasingly large transactions which are both of Community origin and guarantee fishermen an adequate price, as a result of the role that the fishermen's organizations can play to an increasingly greater extent as an important point of reference. We shall also have to discuss again the consolidated arrangements, so to speak, for fisheries ownership.
We favour an approach here whereby fishermen participate in ownership; we are therefore also in favour of local multi-ownership experiments which are becoming a point of reference and, in that sense, we are in favour of a form of integrated management between multi-ownership and the local institutions. We are also very much in favour of involving the local institutions and are also, naturally, persuaded that the fisheries policy should be a common policy but that the regional and local authorities should be associated with it because of the fundamental role they can play, including in relation to the integrated management of coastal fishing.
This also offers a way of eliminating the over-fishing that has occurred in recent years. From that point of view, we consider that the programming document is important and when we have an opportunity of discussing it in official fora, we shall look at the substance in greater detail. For the moment, we regret the fact that we have yet to be involved as Members of Parliament.

Langenhagen
Mr President, I regard the fact that a substantial debate is taking place this afternoon on the subject of fisheries as a sign of the importance of Europe's future fisheries policy. Today's reports relate to waters from the Baltic Sea through the Atlantic to the Antarctic, showing that the fisheries crisis is a worldwide problem. It is therefore right that we should take a global approach to the problems and how to solve them. The way in which we manage our fish stocks will show whether or not we are capable of exploiting worldwide food resources on a sustainable basis. That is the message which we are receiving from institutions such as the FAO; it is the unequivocal message coming now from environmental organizations such as the Worldwide Fund for Nature, organizations which have begun to join forces with some of the world's largest multinational food-producing companies.
The Member States and the fishing industry must heed these authoritative voices. The seas are being overfished: none of our waters will survive if they continue to be fished so intensively. There is only one answer - fewer fishing vessels and less fishing effort, and Mrs Péry clearly endorses this approach. The fishing sector will not emerge from its current crisis unless, on the basis of realistic calculations, the European Union fleets are finally adjusted to match the food resources available in EU waters and beyond.
Restructuring must be accompanied by socio-economic measures. Even if we cannot offer all fishermen jobs at sea, we should not abandon them. We must find them alternatives, either in the fishing industry or in another sector. A team of Community experts, led by the Danish scientist Hans Larsen, has recently made an assessment of fish stocks, and they too have drawn attention to the critical state of affairs.
Mrs Bonino, you have had the courage to present a proposal which is based on a scientific recommendation that the fishing effort should be reduced by 40 %, as Parliament called for back in 1990. Since 1990, the Fisheries Ministers have approved reductions of 20 %, 25 % and even 0 % - depending on the type of fishery, and a further reduction in tonnage is being made between 1992 and 1996 - but not as much as 40 %.
We are calling on the ministers to hold a credible, down-to-earth discussion on the basis of the scientific report and Mrs Bonino's proposals. The House has taken the initiative of concentrating on fisheries today, and we have used this opportunity to bring forward some ideas on how to consolidate the common fisheries policy. Now it is up to the Member States to initiate the action which is required to save the fishing industry in Europe.

Girão Pereira
Mr President, ladies and gentlemen, Madam Commissioner, it is timely for the European Parliament to be dealing at the same time with the general fishery crisis and the NAFO zone crisis, which epitomizes the former. These are issues that must be tackled by implicating the European Union's political will and clear cooperation by the Member States. Some European Union countries tend to ignore the real significance of the fishery sector for the whole European economy. Yet it should be pointed out that in peripheral maritime countries fishery accounts for much economic activity and many jobs.
Take the example of NAFO. My country has been fishing in that zone since the 15th century, cod in particular, the historic reason for which Portugal is now the world's biggest market for that fish. Portugal's accession to the CFP and the NAFO crisis have lead, in four years, to a 70 % reduction in the fishing fleet and the direct or indirect loss of some 12000 jobs.
I can state here that Portuguese shipowners intend to continue fishing responsibly in order to conserve stocks. They therefore agree with moves to strengthen taxation and controls carried out by the European Union. But it is difficult to understand why these controls are not carried out so intensely on ships belonging to nonCommunity countries which have signed the Convention.
Another aspect which we should pay special attention to is that of scientific research which carries out on-going analyses of stocks and changes in their patterns. It is difficult to see why the European Union should have delegated to Canada scientific research in areas as important as 2J, 3K, 3L and 3NO, knowing full well that the interests of both parties clash over this. This research should also be extended to Community waters, taking into account information supplied by fishermen and producers. Take the case of sardines. When the Commissioner tells us that we must cut catches by 40 %, apparently on the basis of data she was supplied with - possibly by my country - the fishermen say that this decision is unfounded given that the stocks are still healthy and have just moved to other areas. This can lead to conflicts that affect the credibility of our institutions and the Union itself.
As is stated explicitly in the documents we are discussing, agreements with third countries should continue to deserve the support and full weight of the European Union given their importance for supplies and safeguarding production. We think, however, that every time that association agreements are concluded with third countries - in which, apart from Community funding fishery products are exempted from customs duties - we should negotiate fishery quotas for Community producers that correspond to the amount of non-received customs duties. I commend the value of these texts and think that they are a good starting-point for dealing with the whole problem of fishery.

Teverson
Mr President, when the Commission report on the crisis in the fishing industry came out in 1994, as Mrs Pery has reminded us so well in her report, it was primarily about prices. Since then the fishing industry has been far more in crisis because of the biological aspect of depletion of stocks and the failure of the management system of the common fisheries policy to address any of the problems and to work effectively within the industry.
What do we have in terms of a solution? First, we have to scrap the common fisheries policy as it stands at the moment. I am not in favour of renationalizing it. That would be an extremely bad idea but we need to scrap it as it exists. We need to make sure that we reduce this constant friction between scientific evidence, the fishing industry, Member States and the Commission. The only way to do that is to push power downwards, to manage fish stocks around the areas of the fisheries rather than around the states which surround these areas and rather than from an inland city of Belgium centrally managing the whole system. That will not work.
In the meantime we have to address the matter of quota hopping and, although we have had many discussions with the Commissioner and I welcome her constructive comments, we have to move this matter on. We cannot get a sensible solution within the current legislative framework. We have to look to derogations from the Treaty to solve the problem.
In terms of the 40 % cuts we are discussing at the moment, there is no chance of getting this through sensibly and I condemn the Council of Ministers for the way it is treating the matter, without at the same time offering positive alternatives to the industry as part of the solution.
With regard to Canada, I am delighted that in the Committee on Fisheries we made this report less antiCanadian than it had been. We now have access to ports in Canada. We need to sign the EU-Canada action plan and we need to make the objection procedure much better. I welcome Mr Kindermann's amendments on that as well.

Jové Peres
Mr President, with regard to the report on the crisis in the fishing industry, I should like to make a number of comments. While we were working on this report - and here I would congratulate Mrs Péry on her efforts - the Commission drew up its proposal on the restructuring of the fleet during the period 1997-2002. It is true that the fisheries sector is suffering a crisis caused by the scarcity of resources, to which the liberalization of trade, the reduction of tariff protection and the growing difficulty of access to other fishing grounds are not unconnected. However, we believe that the Commission has drawn up proposals which it is difficult to accept.
The problems affecting the fishing industry cannot be resolved solely by dismantling the Community fleet. There is a whole series of problems which cannot be ignored, and which in my view are explained quite well in Mrs Péry's report. For example, the social dimension of the common fisheries policy has developed favourably in recent times, but is not commensurate with the large-scale adjustments proposed by the Commission under MGP IV.
Also on Mrs Péry's report, and with many doubts in my mind, I should like to express the following reservations. The report advocates the establishment of 'prices and markets' instruments and mechanisms similar to those of the common agricultural policy, but I do not feel that these are problems which can be addressed in a mechanical way. Given the Community's capacity for self-supply and the present level of tariff protection, application of a prices and markets policy raises difficulties, and could perhaps lead to undesirable effects in terms of the conservation of resources. As for PESCA, it is an initiative which has produced few results. The problem is that if we wish to apply the LEADER model, access to the alternatives envisaged under that model will perhaps be far more limited. I say this too with serious doubts in my mind.
Turning to the report by Mr Arias Cañete, we fully support it. I should just like to underline the weakness of the European Union, which is sometimes the fault of the Union itself, and sometimes the fault of the positions adopted by the different Member States. And I would say to Mr Kofoed that we understand and agree with his comments concerning quotas.

McKenna
Mr President, the four reports being discussed today concern fisheries in widely different areas of the globe: the Antarctic, the Baltic Sea, eastern Canada and here in Europe. This demonstrates the wide extent and influence of EU fleets. The common theme running through them all is the effect that the excessive amount of fishing capacity has on European fisheries.
The Péry report on the crisis in the fisheries sector quite correctly points out that there are several problems that affect the industry, but surely the most important is the fact that there are too many boats chasing too few fish. This is probably the most important issue that faces the EU this year as it prepares the multi-annual guidance programme - the fourth one - to reduce the size of the fleets. It is certainly the most contentious political issue. Everyone accepts that many of the EU stocks have been over-exploited. The most effective single action that the European Union can take to resolve this problem is to decrease the size of its fleet. If this is not done, and done very soon, then the crisis in the sector can only escalate. The ones who would suffer most would be the small boat owners, those with a small economic base and very little political clout but who, in fact, actually provide the most employment.
The decisions on how to reduce the fleet should consider not just the status of the stocks the fleet fishes but also other impacts of the fleet. For example, some gears have a higher by-catch than others or inflict more severe damage on the sea bottom. Environmental impacts of gear are a very important factor. Similarly, in terms of the employment generated, preference should be given to vessels which provide most jobs relative to the amount of fish they catch.
In summary, the fleet reduction is urgently needed and it must be vigorously implemented. The Green Group submitted amendments on this issue in committee but they were not accepted so we have re-submitted them to plenary. I hope that they pass this time. For unless there is a rigorous programme implemented right away then the next report on the sector may well be its obituary. I was glad to hear Mrs Péry say that she will vigorously support efforts by the Commission. So I hope that she will support our amendment now.
The issue regarding the Baltic concerns the adoption of a closed season for salmon. Whilst stocks of salmon in the Baltic have been decimated by habitat destruction and over-fishing - including the use of long drift nets - the recent Lassen report on fishing capacity in the EU actually recommends the complete closure of the fishery, so a simple seasonal closure is totally insufficient.
The waters east of Canada have seen fishing vessels from Spain, France and England for hundreds of years. They used to be one of the world's greatest fishing grounds, which is probably why fishermen went so far under difficult conditions to fish there. But in the 1980s the bloated size of the European fleets forced the EU to claim unilateral quotas on several stocks there. It is unacceptable behaviour in a multilateral convention to regulate fishing. These unilateral quotas contributed to the obliteration of some of the stocks in eastern Canada; I say 'contributed to' for the responsibility does not actually lie with the EU alone. Canada has shown that it can actually wipe out its stocks without any help from anyone else. But here the European fleets did help.
As regards the Antarctic, the European Union has no real fishing interests, at least on paper. However, some vessels fishing down there are European vessels flying other flags and established under joint ventures. So the long arm of the European Union's excess capacity reaches out even as far as there.

Macartney
Mr President, I should like to congratulate Mrs Péry on covering a large amount of ground and putting things very tactfully, but nothing that she says in her tactful way can disguise the scope of the crisis - not just the crisis in stocks and management but also the crisis of confidence of our fishermen right across Europe. This presents a very real challenge and difficulty for the Commissioner. I think we should look at ways in which we can bridge the gap. I congratulate Mrs Péry. I should also like to associate myself with the points made by Mr Baldarelli, Mrs Langenhagen, Mr Girão Pereira and Mr Teverson. We are all facing a common problem together. But we have to find a solution so that we can say to our fishermen: this is a solution; it is not being imposed on you by Brussels, but it is in your interests. The key thing is not to talk about imposing 40 % cuts - which everybody can then blame Brussels for - but to say: how would you tackle the problem yourselves? That is where the decentralized management which has been proposed by several speakers is absolutely fundamental. At the moment the fishermen, certainly in Scotland, are terrified that somehow the foreigners will come and take all their fish and then go away again and they will be left with nothing. Whatever you say, they are apprehensive that they do not really own the fisheries resources off their coast.
Therefore, the way forward - I am quite convinced as are many colleagues in the Committee on Fisheries - is to have a decentralized management system so that the fishermen in the particular sea, whether it is the Baltic, the North Sea, the Adriatic or whatever, whose livelihoods are at stake and whose descendants will benefit if they conserve things, will take responsibility.
At the same time there are things that have to be done right across Europe on an equal basis. One of the gripes is that inspectors, for example, do not apply the rules universally across Europe. We have to address that to make sure that the same standard, the same misery, where misery has to be applied, is applied to everybody. Then people would begin to see some justice in the system and we could address all the other burning questions - such as quota-hopping and so on, which I do not have time to go into - to make sure that we have a common fisheries policy which is sustainable and which will be supported.

Souchet
Mr President, I should like to congratulate Mrs Péry on her thorough and discerning analysis of the causes of the serious crisis currently affecting the Community's fishing industry. Unfortunately, the Commission communication on which this report is based fails to put forward any proposals commensurate with the scale of the crisis. It recommends a policy which is more stopgap than imaginative, more resigned than determined. This policy seems to be based on a fatalistic premise: that the disappearance of the Community fishing fleet, overseen by the CFP, is inevitable.
However, Europe's fishermen are expecting a different message. As the elected representative of a maritime region in the west of France, I can assure the House that they are expecting us to send them a message of hope, telling them that the profession they have chosen is not doomed, that it may be suffering a crisis, but that they can trust in its future and that their children will be able to practise it. That is the message which I propose we send to all the communities throughout Europe which depend on fishing, by adopting the amendments that I have tabled on behalf of my group.
Firstly, all the measures aimed at reducing the size of our fleets are the consequence of the almost total opening-up of the Community market to imports from third countries, whose methods, as the House well knows, are frequently at odds with our legitimate concern to conserve fishery resources. This issue is not addressed in the Commission communication, although it is a matter of urgency to restore the confidence of our fishermen in the conservation efforts that are required of them, above all by establishing a protective European framework in the face of imports from third countries.
Also, surely the mechanisms of market support should be replaced by a more pro-active policy, for example one which establishes the compulsory levying of a countervailing charge on the import of species found in the Community, amounting to the difference between the import price and the current guide price, which could be used to promote the fishing industry in the developing countries?
Finally, it also seems essential to me to involve the sector more closely in the management of resources, in particular by giving it responsibility for managing the resources of specific fisheries, on the basis of historical rights, within the framework of decentralized regional conferences.

Le Rachinel
Mr President, ladies and gentlemen, in her report, Mrs Péry analyses in detail the causes of the crisis in the fishing sector and attempts to provide some solutions. Unfortunately, those solutions are not enough to halt the decline in the French and Community fishing industries.
The diagnosis is correct, but the proposed remedies are quite inadequate to cure such a serious illness. And the findings are correct, particularly when it comes to condemning the deregulation of the world market without an ounce of security, the serious disturbances resulting from unfair competition, and the global downward pressure on prices. On the other hand, the solutions proposed are not equal to the challenges to be faced. Mrs Bonino, as the Commissioner for fisheries, wishes to cut the Community fishing fleet by 40 %, to scrap hundreds of vessels and force thousands of fishermen into retirement. In a word, she wishes to decommission our fishing fleet in order to leave the field open for predators who use the GATT agreements for their benefit alone.
We are told, rightly or wrongly, that there is overcapacity in the fishing industry, that fish stocks are becoming dramatically scarce, that juveniles are inadequately protected, that the level of marine pollution is alarming, and that the use of certain fishing devices and practices is wrong. At the same time, however, Mrs Péry considers it essential to modernize the fleet with vessels using more selective fishing gear, and also wishes to dismantle tariff and customs protection. There is a blatant contradiction here.
As with the CAP, as with the disaster-stricken industries, there is no wish to see the real causes of the crisis or to tackle them. Who but us will have the courage to say that destructive free-market policies and the globalization of trade desired by GATT and the Europe of Maastricht are placing our fishing fleet at the mercy of third countries which respect no rules and sell their fish at dumping prices, thereby jeopardizing our producers' organizations?
In ten years, our dependence on fish imports has increased by 30 %; and the processing industry depends almost entirely on imported fish.
I wish to stress - because, I too, like my colleague Mr Souchet, am the elected representative of a maritime region in the west of France - that there is now a need to set clear priorities for the entire sector. What are these priorities? The promotion of non-industrial coastal fishing; the application of minimum import prices; compensation for fishermen for loss of income in the event of a fall in prices; and the strengthening of controls, especially on third-country vessels fishing in Community waters. We should also like to see more low-interest loans and debt-relief for fishermen; the reduction of port charges; the amendment of the common customs tariff, which does not allow the principle of Community preference to be guaranteed; the restoration of quality by means of a labelling policy and better exploitation of fresh fish; and the improvement of the links between research, training and the profession.
Yes, France's fishing industry still has a future, but it is not the fourth multiannual guidance programme which will restore confidence to 16 500 French fishermen. They need to be listened to, supported and defended. This is the decision that has been taken by our group, whose chairman, it should be remembered, is the son of a fisherman who was killed at sea.

Kindermann
Mr President, ladies and gentlemen, I am only speaking about Mr Arias Cañete's report on the problems of the fisheries sector in the NAFO regulatory zone. Although this is a very thorough and open-minded report, my group has some difficulties with it, and that is not because it is so openly critical of the Canadians at various points. In our view, this criticism is mostly justified. However, the report focuses too narrowly on the maximizing of fishing opportunities and fails to take account of some important aspects which should certainly have been addressed in an own-initiative report of this kind. I would firstly mention the monitoring arrangements: instead of dismissing the monitoring arrangements contained in the bilateral fisheries agreement of 17 April 1995 between the European Union and Canada as discriminatory and too costly, its innovative aspects should have been given greater prominence.
It is true that the new inspection arrangements are costly, but they are obviously working and have, above all, helped to defuse the situation. Far fewer infringements have been detected than before, and so the potential for conflict between the parties to the agreement has been much diminished.
It is also questionable whether different arrangements - as called for in the report - really would be more effective, or whether they might ultimately dilute monitoring practice. To my mind, on-the-spot inspections still remain the most effective way of monitoring catches and the type of gear being used. Satellite surveillance cannot replace these inspections, but only complement them in order to determine the location of vessels, as is in fact stipulated in the NAFO monitoring arrangements. The relatively high cost of carrying out such measures should be regarded as the price to be paid for dwindling fish stocks and for past neglect. In any event, we should like the existing NAFO monitoring arrangements to be recognized as an improvement in terms of the conservation of stocks, thereby helping to safeguard fishing effort in the future.
Another very important aspect which is also omitted from the report concerns the decision-making procedure in the NAFO Fisheries Commission. Those in the know agree that the main reason for the appalling state of fish stocks in the NAFO zone is the fact that the NAFO decisions on management and conservation measures are not binding. The scope for raising objections has undermined all the measures, and any party dissatisfied with the catch quota allotted to it has routinely been able to award itself higher catch quotas. For my group, therefore, the abandonment of this objection procedure is the key to further progress in fisheries management in the NAFO zone. Unless this happens, in our opinion, there would in fact be little point in putting any of the other demands into effect. What, for instance, would be the use of the rapporteur's call for a more balanced composition of the NAFO Scientific Committee, or for a voting system in NAFO which is more satisfactory to the Union, when in a borderline case another party which is outvoted can raise an objection to certain management measures, thereby triggering the next conflict?
While it is true that my group's request does not correspond to the currently accepted international principles, it would nevertheless be very appropriate in a report which in several respects takes issue with those principles. One need only look at the proposals concerning the voting system in international organizations. Also, our request is by no means out of place, since the UN agreement on the conservation and management of straddling stocks and discrete stocks explicitly obliges coastal states and countries engaged in deep-sea fishing to cooperate in laying down conservation and management measures.
My group has tabled a number of amendments reflecting our concerns, and it is vital for them to be adopted if we are to support the report. I therefore ask Mr Arias Cañete too to look favourably on these amendments.

Fraga Estévez
Mr President, Commissioner, although some Members may think that Mr Arias Cañete's report is excessively critical of Canada, I personally - having closely followed the European Union's fisheries relations with that country - wish to congratulate the rapporteur on the even-handedness of his report, which avoids dwelling on the periods of tension which Canada's stance has forced the Community to endure. Now it is a question of looking to the future.
In my view, this is another indication of the European Union's goodwill and readiness for dialogue. However, I am bound to condemn the fact once again that - judging by the latest news - this is not an attitude which is shared by Canada. It is true that the Canadians have expressed their willingness to open up their ports to the Community fleet - although only in certain cases - and are giving to understand that this is a generous concession on their part. The fact that this is a unilateral decision, however, leads us to fear that it can be revoked at any time.
If Canada really wished to permit access to its ports, it would have signed the bilateral agreement, one of the key points of which concerns precisely the normalized access of the Community fleet to Canadian ports. However, Canada continues to show great reluctance to ratify the agreement in question.
It is my understanding, moreover, that in the latest round of negotiations between Canada and the European Union, Canada continued to insist that it had a complete right to manage certain stocks exclusively and absolutely - cod, for example - in international waters. This is a fresh sign of its intention to take action outside the 200-mile limit, in violation of the International Law of the Sea.
Consequently, I would call on the Commission once again to defend our fishing rights, since the European Union is just as sovereign as Canada, and to defend Community interests in accordance with the Union's international weight, which is far greater than the results achieved recently would suggest.
With regard to Mrs Péry's report on the crisis in the fishing industry, the rapporteur deserves to be congratulated on her efforts to unite positions. On the specific question of markets, however, I should like to call on the Commission to present, in its new draft regulation, a genuine reform which is geared to the challenges of the common fisheries policy. This time, it must be an in-depth reform, based on non-discriminatory criteria and free of the excessive red tape which is a burden on a sector that needs mechanisms to allow it to respond rapidly, ensuring it a permanent position on the fishery products market.
And with reference to Mrs Péry's comments concerning the social measures for which there is such a need in the fishing industry, I believe that a good indication that something is amiss is the fact that in the next budget, only ECU 50 000 is earmarked for such social measures, whereas ECU 3 000 000 is set aside for observers in the NAFO zone, for example. In my opinion, something is not right in this sector.

Gallagher
Mr President, at the outset I want to congratulate all of those who have presented reports here today. Due to time restrictions I shall concentrate on the Péry report. The current crisis assailing the Community's fishing industry is sapping morale from the most important employment sector in peripheral coastal regions in this Community, including my own country of Ireland.
It would surely be considered a great scandal for the Community if, after obtaining control over significant areas of the most productive fishing zones in the world, we were proved incapable of managing fisheries in a coherent and, more important, a practical fashion for the benefit of the Union's consumers and producers. There are matters affecting us where short-term decisions could be taken. What have we done about imports of salmon from Norway. We have introduced minimum import prices. They have not worked. What about quantity restrictions? What about the low cost of cod imports? Nothing has been done there by the Commission.
I believe Parliament can play an important role in assisting in the restoration of confidence to an industry where morale is at its lowest. We must point to a more positive future. Tax and quotas and not GRT or carrying capacity have regulated the landings of various species over the years. Of course we are looking at technical conservation measures. We have not been presented with specific measures as yet. At the same time the Lassen Report is indirectly being presented to us and suggests we should slash the fleet by 40 %. I would suggest to the Commissioner that is not the answer. Tax and quotas are the answer. We are unable to make our boats safer. It is an indictment of the Member States and the Commission that we were unable to make our boats safer. If we add to the GRT, we cannot receive permission although we are not adding to the carrying capacity or to the landings of fish. It makes little sense to me.
There is a crisis and the Commission is adding to the crisis because of the veterinary charges to be introduced later after a short derogation period. What is Commissioner Bonino doing about that? And what are we doing about early retirement? It is too horrendous to contemplate what will happen with a drastic reduction.
Finally, I and many of my colleagues speak on behalf of the industry in Ireland, but Ms McKenna does not. We are not prepared to share the pain. We have shared too much pain over the years. We have paid too great a price in Ireland. We want to ensure that Irish fishermen are fairly treated in the years to come.

Cunha
Mr President, Madam Commissioner, ladies and gentlemen, with growing demand it is no surprise that the management of fishery stocks should once again be a priority in the common fisheries policy.
But we need to be aware that the problem of balanced stock management should not be the sole responsibility of the European Union but should be done worldwide. It is also important to point out, in this regard, that some of our current problems are due to the ingenuity of the Commission in its negotiations with third countries.
In fact, only a few years ago we were accepting reductions in our fish quotas but these countries were increasing theirs. That is unacceptable, because the rules must be the same for everyone. Having given in in international negotiations, the Commission has now resorted to the draconian management of our waters, proposing reductions in the fishing fleet by up to 40 %, such as for sardine fishing off the Portuguese coasts.
Has the Commission, Madam Commissioner, actually assessed the economic and social effects of an almost 50 % cut in the fishery sector which represents more than 15000 jobs in Portugal? If the issue of stocks was so serious, why is it only now that the Commission is acting? Who supplied the Commission with these figures? What alternatives does the Commission propose to fishermen, industrialists and workers and their families whose livelihood depends on Portuguese fisheries?
The Péry report - and I congratulate Mrs Péry on its quality - seems to take a balanced look at the main issues of the common fishery policy. It will therefore win my backing especially since it takes on board some of the amendments tabled by me and approved by the Committee on Agriculture and Rural Development, such as those on international negotiations, the reaching of interprofessional agreements and the possibility of introducing a storage premium to be paid to the industry under certain conditions.

Novo
Mr President, ladies and gentlemen, Madam Commissioner. For a long time we have been campaigning for conservation of fishery resources, taking all the technological, social, monitoring and taxation measures needed to bolster the industry properly.
However this strategy, albeit vital, has not been very transparent nor has it been applied by everyone, indeed by very many. First of all because the decisions are very often taken on the basis of at times inadequate or distorted scientific studies which fail to take into account local reality. Also because these decisions overlook the appropriate and vital intervention of fishermen's organisations and fail to take account of any preference trade policy for the Community fisheries sector. All of these and other facts justify and generalise climates of mistrust and conflict among fishermen and ship-owners in the Member States. On the other hand - as shown by the figures and recent declarations by the Commissioner herself - there are few countries (like Portugal) that in recent years have observed (excessively sometimes) obediently and scrupulously the decommissioning plans while other countries, unfortunately the majority, have not done so.
Against the background of a crisis in the fisheries sector, non e of this should be forgotten. Neither the Commission, nor the Member States, nor the government of my country. As well as conserving stocks, we need more transparency and equal participation in the decision-making processes - e.g. in NAFO, where I must repeat my utter failure to understand the proposals to reduce the TACs without proper scientific grounds - or the case of cod, also in NAFO waters. We must express our opposition to any reduction proposals which are not the same for all countries and species (e.g; sardines) without taking into account the reduction efforts already made by various countries and not taking into account recent facts which have been to the detriment of Portuguese fisheries, such as the agreement with Morocco and its effects on fish preserves and fisheries in general.

van der Waal
Mr President, our desire to have a modern, large-capacity fleet can easily come into conflict with the need to maintain fish stocks at steady levels, so the Péry report is right to call for stricter controls on the observance of quotas, for the spawning grounds to be protected and for trust to be restored between marine biologists and fishermen.
On this last point, there is the problem that less and less money is being made available for research into fish stocks, which undermines the quality of the data and the fishermen's confidence in them. It is therefore essential that adequate funding should be provided for detailed research. The huge fluctuations in the annual TACs are also very damaging. The flexibility now brought to the quota regulations through the introduction of a current account system is a step in the right direction, and the Commission should actively pursue the idea of multiannual planning.
I am less enthusiastic about the calls to increase Community price support. This may limit loss of income in the short term, but in the long run the sector will be better served if the producers' organisations themselves take measures to regulate the market.
Finally, on the subject of imports from non-Community countries, these are extremely important for the fish processing industry. Because of the reduced quotas, the European fleet is no longer able to meet demand from the industry, but in order to prevent unfair competition with the European fishermen there should be stricter controls to ensure that products from outside the Union meet the Community's quality and hygiene requirements. This is an area in which the Union's fisheries sector has invested heavily.

Crampton
Mr President, I want to talk mainly about Mrs Péry's report, for which congratulations and support. I fear I shall say some of the things that have already been said.
We have here the views of the Committee on Fisheries on the continuing crisis in the fishing industry. The basic crisis has been with us for many years and it will be with us for many years more unless we do something radical about it. In fact, it will probably become hardly worth fishermen putting to sea in many parts of the European Union's waters. That has immense consequences, of course, not only for the fishermen but for all those involved on shore and for the consumer.
We have to pay serious attention to this problem, which is a problem accentuated by a lack of political will, by far too much nationalism, and dare I suggest that we should look at the policies of the Norwegians and Icelanders and how they tackle their problems. The basic reason is, of course, simple: too many boats chasing too few fish. You can tackle this in two ways, and both need to be tackled. The first one - too many boats - obviously needs a serious decommissioning scheme. Now some countries have put decommissioning schemes into practice; my own country has not been serious about this and therefore is marked down for a 40 % cut. That is not an acceptable solution for fishermen and for the people who are dependent upon them.
The other side of the problem is too few fish. Now there is much that we can do here and much that the Commission and the various Member States' governments could do. In many cases the research is already there. Mrs Péry mentions many of the things that could be done: improvements in the gear that is used, to allow many smaller fish to escape; improvements such as inserting square-mesh panels in nets. There is a whole range of technical improvements that have been tried and that work. We obviously need large areas to be closed off for fishing part of the year or, in some cases, permanently or near enough permanently, to allow the stocks to recover and to allow the juvenile stocks to grow. So we need conservation areas, if you like. We need to somehow get into being a policy which ends the practice of discards. I do not know about other areas, but in the North Sea sometimes 50 % and more of the catch of a fishing boat is discarded because it is too small, unmarketable, or whatever. So we have a whole range of measures on both sides of the equation.
Finally, I must stress that we need a very rigorous evaluation and inspection system and I and many of the fishermen I talk to would prefer it if that was operated by the European Union.

McCartin
Mr President, I wish to thank Mrs Péry for her report and to say that I agree with her when she implies that the common fisheries policy is just a half-baked policy. Unlike the common agricultural policy it does not have the confidence or respect either of the producers or the consumers.
In fisheries, the policy always seems to be about reducing the catch. The European Union is only 50 % selfsufficient and stocks are falling, yet prices continue to go down. We feel more concern about cheap supplies to processors than about the income of the fishermen whose interests we are supposed to support. This policy is doing the image of the Union no good either with its own producers or abroad. The common fisheries policy seems always to be about control but the benefits never seem to come. The Member States are unwilling to concede to the European Union the full responsibility for a comprehensive policy but are always willing to blame the European Union for the negative factors.
There is one thing about the Commission's proposals which I would question: why all the emphasis on tonnage if we have a quota policy which is working? Why, if quotas are being observed, do we need such emphasis on tonnage? Quotas could be policed: with a proper computer system, a proper satellite system and proper import controls we could regulate the amount of fish taken out of the seas and marketed, if we really set ourselves to do so. If we are serious about supervising landing and if Member States cooperate, then tonnage reduction could actually be on a voluntary basis with compensation. If we had a policy of maintaining proper prices, then lower quotas would be much more acceptable in the fishing regions. Some trade restrictions are acceptable in view of the social environmental problems that are so obvious. If there is a precious and scarce resource, why do we exploit it and give it away at prices that are far below its real value?
I agree with Allan Macartney when he suggests that the policy needs a fundamental reappraisal and that the disadvantaged areas should be given more control over both the exploitation and the marketing of the resource that is adjacent to them.

Sjöstedt
Mr President, I should like to say a few words about the Kofoed report on fisheries in the Baltic Sea. The report has been drafted in response to a Council regulation on salmon fishing entailing the further extension of the closed season in order to protect, above all, wild salmon. They are good measures even if they do not go far enough in view of the crisis conditions which exist as far as wild salmon in the Baltic is concerned.
In connection with this report the rapporteur has, however, tabled two amendments on cod fishing in the Baltic. These amendments propose replacing the existing quota system with rules on fishing boat engine power. I do not think this is an especially good or well-thought-out idea. The problem with the current system is that certain countries stick to their quotas while others do not do so in the same way; what is needed therefore is better monitoring. Another problem is the level of prices for cod caught in the Baltic.
I believe that a change to engine power would instead make it still more difficult to check how much fish is actually caught in the Baltic. It would also be more difficult to adjust fishing to actual stocks. I will not vote for the proposals on engine power.

McMahon
Mr President, I welcome the Commissioner. It is going to be a pleasant change to hear her views rather than read about them in the Financial Times and the other press.
Fishing in the Communities is a very volatile, very political matter at the moment. We have too many fishermen chasing too few fish. Everyone accepts that. I think it is symptomatic of open competition, which is compounded by the increasing efficiency of our fishing vessels and particularly the gear. Indeed when I was at school we were told that the United Kingdom was a lump of coal surrounded by a teeming sea of fish. There is very little coal left in the United Kingdom and if we go on using the gear we are using now then there will be very little fish either. The Union has got to call a halt to this.
We are, at the moment, in a crisis in the fishing industry in Europe and particularly in the UK where the fishing fleet is the third largest within the European Union. The government is again preaching the virtues of deregulation. We have seen in the last few weeks the effects of deregulation on the agriculture industry. We do not want to transfer the bad practices of BSE into the fishing industry by deregulating everything and believing it is the way ahead. In an attempt to reduce the number of vessels by the doctrine of laisser faire economics the United Kingdom Government has left the fishing industry in Britain suffering at the hands of market forces. This is not conducive to promotion of conservation of fish stocks or to security of jobs of local fishermen, or to the livelihood and the thriving of local communities. It is no wonder, therefore, that local communities which are totally dependent on fishing for their livelihood view the United Kingdom Government and others with suspicion. The same government began decommissioning vessels as late as 1984 and offered grants in return for surrendering licence. It is now crying out in outrage about quota-hopping. Indeed the same government which is crying out about quota-hopping is the government which, at the moment, to popularize its own party is parading its xenophobia and has started blocking European institutions.
We need action on quota-hopping but we must disassociate ourselves from the nationalistic sentiments surrounding it. There is a solution to the problem of quota hopping: there should be some recognition and licensing done by the Member States, to ensure some control of the quota-hoppers.
The fundamental problem remains that fishing stocks are becoming dangerously scarce; Europe's fishermen are going out of business every day; sustainable conservation needs to be promoted and enforced. This can be helped by a reduction in the entire fleet capacity of the EU. The three multi-annual guidance programmes have all failed to allow Member States to reduce their fishing fleets. In the UK alone it will not be possible to meet the 1996 fleet reduction requirements. We have to deal with this problem. We have to come forward with proper methods of conservation and proper methods of supervision.

Varela Suanzes-Carpegna
Mr President, ladies and gentlemen, firstly I should like to welcome the fact that this important joint debate on four reports by the Committee on Fisheries is taking place. Of these four reports, two relate to the conservation of fishery resources - an issue of concern to the European Union - in two areas: the Baltic and the Antarctic. The latter, incidentally, is an area in which the Community fleet does not have a presence and where, in my view, specific and experimental fishing campaigns should be carried out, with strict respect for the ecological balance.
With regard to Mrs Péry's report, it sets out the diverse and complex set of problems currently affecting the fishing industry, where I would stress the need for socio-economic and structural flanking measures, given that, as we know, the fishing industry is based in areas which are heavily dependent on this sector. I also welcome the notable inclusion in the report of a call for the strengthening of fisheries agreements with third countries, both old and new.
Lastly, Mr Arias Cañete's timely and important report on the problems of the fisheries sector in the NAFO zone makes it clear that major steps still need to be taken in order to balance the fishing effort in this area and ensure that the European Union participates in that effort on an equal footing. We wish to underline the urgent need to establish a voting system which is in keeping with the European Union's actual weight; to modify the composition of the NAFO Scientific Committee; to increase Community investment in research in this zone; to improve protection of the Community's fishing opportunities in this fishing ground; to reduce the cost of monitoring systems; and to call on the Canadian authorities to make practical gestures - such as withdrawing the legislation which discriminates against the European Union and ratifying the 1992 bilateral agreement - and to insist that they lift their ban on access to Canadian ports by Community vessels totally and for good. These measures are vital, Commissioner, for the improvement of the European Union's relations with Canada in general, and its fisheries relations in particular.

Provan
Mr President, there is no doubt in my mind, nor I am sure in colleagues' or the Commissioner's minds, that there is a crisis of confidence in the fishing industry at the present time. In my own country some in the fishing industry are calling for the scrapping of the common fisheries policy. They conveniently forget what it was like before the common fisheries policy was introduced in 1983 and that at that time there were many international agreements. Fortunately we now have a policy but we all recognize that it needs to be adapted because it is not working properly.
The 40 % reduction which is being proposed at the present time may be a suggestion which is not properly understood. People do not understand either that there are fewer and fewer fish in the sea. But I would suggest that we must work with the fishing industry and make sure that it fully understands the problems. I welcome the fact that the Commissioner has gone round many of the ports in the Community discussing the issues with the fishermen. She has raised her own profile and that of the Commission regarding fisheries and that is to be welcomed.
I hope we can look at and address properly the issue of quota hoppers. I do not believe that quotas and the single market are compatible with each other. That is something we must look at. If we are going to have confidence in the industry we cannot allow quota that is allocated to one country to be fished by another country. That is the major issue we must face.
There are many problems we must solve and I hope we can work with the Commissioner to get the right messages across.

Iivari
Mr President, Madam Commissioner. In his report Mr Kofoed deals with the situation of the Baltic salmon in a most creditable way. With regard to the population of wild salmon the situation is already alarming. There is a danger that entire salmon stocks will become extinct. Wild salmon forms only 5-10 % of all the salmon in the Baltic Sea.
By definition wild salmon is a salmon stock from a particular river which goes back to spawn in the same river in order to reproduce. Finland, for example, now has such salmon stocks in just two rivers, Tornionjoki and Simojoki.
Special action is required to save the wild salmon population. The most important measures are fishing restrictions both at sea and in the spawning grounds, and the regeneration of fish stocks in order to preserve the genic genotype of wild salmon. It is very positive that the necessity to regenerate fish stocks, an issue which is not very well known within the European Union, is included in Mr Kofoed's report.
Another thing worth mentioning is that it is a great waste to catch wild salmon in the sea where it is half-grown, often weighing only a few kilograms. The price of salmon consequently remains very low compared to the price a fisherman would pay the local authorities for fishing salmon in a river as a sport.
Well looked-after fish stocks are of great importance to tourism in Finnish Lapland. The strengthening of Tornionjoki's position as a salmon river is to be regarded as good from the point of view of both regional and environmental policy. That is why fishing restrictions to protect wild salmon and fish stocks to secure the salmon population are required. I feel that we are here today on the right track on this issue.

Imaz San Miguel
Mr President, I shall concentrate my remarks on the question of fishing in the NAFO zone, and especially on the problems of a fleet which has undergone one of the toughest decommissioning programmes in the European Union over the last few years. I refer to the Community cod fleet. I should like to thank the Committee on Fisheries - and in particular Mr Arias Cañete - for adopting my amendments to this report concerning the cod fleet. Because the fact is that the Community fleet's fishing opportunities in division 3NO - the 'nose' of the Terranova Great Bank, which is in international waters - are currently nil, since a zero TAC has been set.
Let us remember that the NAFO Fisheries Commission fixed a TAC of 6000 tonnes for cod in division 3NO for 1994, 2213 tonnes of which were allocated to the European Union. But at the beginning of 1994, Canada called for a meeting to be held in Brussels. At that meeting, which took place in February, without any new scientific data being put forward to justify the amendment of the TAC for this division, a zero TAC was set which has also been applied in 1995 and 1996.
Commissioner, you are well acquainted with the crisis afflicting this sector, whose fleet is in some cases confined to port for up to ten months a year. I would urge you - with your customary firmness, which has brought such good results for the Community fishing industry and other sectors - and the rest of the Commission to play a leading role in securing the amendment of this TAC, the application of which is not based on sound scientific data. 93 % of the Terranova Great Bank lies in Canada's exclusive economic zone, and the Community fleet, operating in international waters, must not be made to pay for Canada's mismanagement in this area. Above all, Commissioner, we cannot continue to let Canada pursue its eternal fisheries strategy: concealing the promotion of economic and commercial interests behind environmental arguments, whilst it destroys and exhausts its own fishery resources.

Izquierdo Rojo
Mr President, time has proved us right - and not only time, but also the speeches that we have heard in this debate today, in comparison to those that were made in the past. Furthermore, the scientific and legal analyses have also made it crystal clear that in the 'Halibut War' , the European Union and Spain were entirely in the right. As the Commissioner rightly said at the time, the seizure of the 'Estai' was a case of hijacking, and Canada was violating international law. Today, the claims to be protecting the environment made by the mercenary Canadian Fisheries Minister at the time are clearly laughable.
However, let us examine the facts - because the facts which gave rise to that conflict still remain: Canada wishes to drive the Community fleet out of international fishing grounds which are not its own; it has not ratified the bilateral fisheries agreement; it retains laws which are unacceptable to the European Union; and it is calling into question access to Canadian ports by Community vessels. These facts are keeping the tension alive. Canada is not acting in good faith - far from it - but is maintaining its hostile attitude.
There is a need to demonstrate, even if only once, that the European Union is acting in a coordinated way in the Commission. It needs to be made clear that there is institutional unity and coherence. Consequently, if the Commission, as a collegiate body, refers in its programme of work to relations with Canada as an industrialized country, and if it intends to conclude agreements with Canada in the fields of competition and research and development which are in Canada's interests, then what we must do, logically, is refuse to decouple those agreements from the fisheries dispute.
Commissioner, I would urge you to speak to your colleagues with responsibility for research and development, competition policy and relations with the industrialized countries, and ensure that the conclusion of any agreement with Canada is made conditional on that country genuinely pursuing a policy of good fisheries relations. We must not isolate the fisheries question. There must be unity and coherence in this respect.
We are discussing the halibut dispute, which was caused by a bad decision in the allocation of the corresponding TAC quotas. And the fact that the Spanish fleet had been operating in those fishing grounds since the sixteenth century counted for nothing. Similarly, I have to say that the Spanish Agriculture and Fisheries Minister was unduly hasty in accepting a quota for scorpion fish which is so small that it reduces the authorized Spanish catch by up to 20 % in comparison with last year. This readiness to accept intolerable decisions is astonishing.
I shall end by saying, Mr President, that the other occasion on which the Spanish minister in question turned the other cheek concerned the decisions taken on mad cows by mad British ministers.

Chichester
Mr President, I should like to congratulate Mrs Pery on her report. She is right. There is a crisis in the fishing industry of Europe. The fishermen I represent in Devon are very unhappy about it. They are not happy about quota hopping by re-flagging devices. I welcome the Commissioner's initiatives in bringing forward ideas to try to solve that problem.
Many are aware of the failure of the quota system to conserve, manage and regenerate our fish stocks, not least because of the high proportion of discards which must be thrown back and are no use for conservation, no use for fishermen's income and no use for the consumer at home. The response should be to come forward with better conservation measures, perhaps a 'days-at-sea' policy which could be honoured by all fishermen throughout the Community, and not more proposals for decommissioning, particularly when our fishermen do not believe there is fair play in the implementation of the decommissioning schemes.
Because of the volume of discards our fishermen believe there are more fish in the sea than the scientists say there are. There is distrust of scientific advisers in this area. There is widespread concern about industrial fishing for fishmeal, scooping out immature fish from the sea and damaging the possibilities for regeneration of the stock. I wonder what the Commissioner has to say about that particular aspect of the industry.
As for the 40 % reduction in fleet capacity, I trust this is an opening bid for debate to catch our attention. Above all we want to see fair and even-handed implementation of any measures that are agreed upon.

Apolinário
Mr President, Madam Commissioner, I must first of all congratulate Mrs Pery on her report. I should then like to develop two or three ideas in respect of the Arias Cañete report.
First of all, I think that this report will be a reference text marking - I am quite certain - the line to be taken by the Union in respect of NAFO. We want a relationship of mutual respect and cordiality with Canada within the standards of international law but we were right to condemn the conduct of the Canadian authorities motivated by the interest of domestic politics and not backed up scientifically. Like the rapporteur we agree that the number of votes in NAFO should take into account the number of countries represented by the Union, that the opinion of the Scientific Committee should take prevalence when defining admissible catches, that the Canadian authorities should ratify the bilateral agreement and allow access to Canadian ports by Community ships.
But in this debate and in respect of a discussion which also took place here on the POP IV programme and the debate taking place in my country, I should like to deal with a couple of questions. First, industrial and deepsea fishing is now at loggerheads with a heightened awareness of ecology, environmental preservation and responsible fish stock management, all of which came about when Portugal and Spain joined the EEC - something that should not be overlooked when fisheries are being discussed, in terms of boats and catches and which does not justify an anti-European or anti-construction discourse.
Secondly, in the European Union and Portugal in particular, the social and political weight of fisheries is far greater than its economic weight, by tradition, history and culture. Nobody can forget, especially when we are discussing the Multiannual Guidance Programmes 1997-2002, when we debate the crisis in the sector or thinking beyond the year 2002. The Commission must now carry out its duties, dispel mistrust and win over the people. There can be no fisheries without fish, it is true - but there can be no fisheries without boats and fishermen either.

Malone
Mr President, as a representative from Ireland, I wish to express my deep opposition to the Commission's proposals which we know are aimed at reducing the size of the European fishing fleet by 40 % over the next six years.
Fishing communities by their very nature are located in the most peripheral parts of Europe. In these areas the only indigenous resources that can be fully utilized are the fish in our waters. Current policy, however, places limits on the degree to which this resource can be exploited. Now we all accept that fishing activity must be limited in line with declining resources, but the Commission's proposals are unfair and contradictory. They take no account of the size or the age of the boats that ply the European Union waters and it is simply ludicrous to suggest that identical restrictions should apply to a ten-metre boat and to a seventy-metre boat.
Here I call on the Commissioner to target fleets which impose unsustainable pressure on key stocks. Particular attention must be given to the needs of small, isolated coastal communities that rely exclusively on fish. I agree with Mrs Pery when she says fishing communities throughout Europe have little confidence in present policy. In order to rebuild this trust, there has to be a complete crackdown on illegal fishing. I am glad to say that the Irish presidency intends to make this a priority in its forthcoming term.
Simply setting minimum prices for imports or financial compensation schemes are not sufficient: further action is required. I therefore welcome the rapporteur's calls for the improved management of resources, stabilization of incomes, measures to compensate for income losses and the creation of 'SEA LEADER' programmes.

d'Aboville
Mr President, Mrs Péry's report analyses the different factors in the long-term crisis afflicting the Community fishing industry. The rapporteur underlines the need for a political priority to be established, that of restoring confidence to the sector, since we must accept the fact that Europe's fishermen have lost all confidence.
What message is the Commission sending them? It is always the same: there is overfishing, and boats must be scrapped. Certainly, there is overfishing of some species. Certainly, there are catches of some fish which are too young. Certainly, it is the Commission's duty to sound the alarm.
But fishermen are not fools, Commissioner. They know very well that the survival of their profession depends on managing the resources responsibly. It is simply that they are obliged to work more, to produce more, because the collapse of fish prices leaves them no alternative, if they wish to survive. And we are talking about tremendous rates of work, crews who go out to sea for 320 or 340 days a year, ageing vessels which fishermen have neither the time nor the money to maintain, and a single obsession: to fish more in order to avoid bankruptcy.
Contrary to some simplistic ideas, the more the price of fish falls, the more our fishermen increase their catch tonnage in order to balance their books. It is not just a question of scrapping vessels, but above all of breaking this vicious circle. The crisis affecting the fishing industry is clearly a market crisis. The role of the common organization of the market is, in particular, to regulate the conditions of competition between Community producers and to prevent unfair competition from third countries. However, prices are being undermined from outside as well as inside the Community. From the outside, they are being undermined in general terms by what are token health controls; from the inside, they are undermined by unfair competition, caused by monetary and social disparities and encouraged by the Commission, which refuses to take the necessary market organization measures.
When will it be understood that the resources currently available are enough for the existing equipment to be profitable, provided measures are taken to make price stabilization mechanisms compulsory, so as not to encourage overfishing? When will it be decided to impose the application of minimum prices - which only make sense if everyone plays by the same rules - on the producers' organizations? I know that this seems to run counter to the sacred dogmas of economic liberalism. However, Commissioner, this is the reality which must be faced: the reality which means that whilst over the last four years, producer prices have fallen by 25 %, they have done nothing but increase for the consumer! The consumer is not being made king, but once again taken for a fool.
Today, the Commission is presenting its fourth fisheries guidance plan. With the commendable aim of conserving resources, this plan provides for further drastic fleet reductions. If a price regulation mechanism is not implemented at the same time, as Mrs Péry proposes with regard to the role of producers' organizations, then this plan will not restore the confidence of fishermen, but ensure their lack of support and anger. The industry will go from crisis to crisis until - and I wonder if this is the Commission's aim - the total disappearance of the patients will allow the doctor to announce triumphantly that he has eradicated the disease.

Bonino
Ladies and gentlemen, thank you all for taking part in this debate and, above all, thanks to the rapporteurs for the four reports we are discussing, although, naturally enough, the debate has expanded to cover many others aspects of the common fisheries policy, as was bound to happen.
I should like, if I may, to divide what I have to say into two parts: the first providing a specific Commission response to the four reports on the agenda, that is the Péry report, the two Arias Cañete reports and the Kofoed report; and a second in which I shall attempt to reply to more general issues raised here by many colleagues and many honourable Members.
I should like to begin by thanking Mrs Péry for her report on the crisis in the fisheries sector, particularly because it is always helpful to listen to other ideas, other possible solutions regarding a sector in which no-one - or at least so I hope - can claim to have the complete answer, always at the ready and for all purposes. At any rate, I believe that the contribution of this debate is very valuable, particularly with a view to the report that is to be considered by the Council. For instance, you, Mrs Péry, tackle a range of issues on which I am in agreement; however, when we come to the problem of the market, a problem to which many of you have referred, I have clearly to remind the House that the professional organizations do not fit in with a free market situation - as you, Mrs Péry, are perfectly well aware - and that, consequently, since these bodies represent a departure from the basic rules, membership of professional organizations cannot be made compulsory; far less, it seems to me, can withdrawal costs be made compulsory for those who do not belong to the professional organizations. I am afraid therefore that we need to look at the proposal concerning the markets in all its complexity, and it is for that reason that the seminar, dedicated solely to the issue of the markets, that Parliament and the Commission are organizing jointly with the industry for the month of October - in fact I believe that the date has already been set for this single-topic seminar bringing together the Commission and Parliament and the European industry and focusing on the market issue - will help us to produce some ideas. It is in fact common ground that a problem exists, but there are times when the solutions proposed seem frankly to me to be impracticable or counter-productive. Let me give you an example: if we arrive at a withdrawal price that is too high, or kept high, do we not perhaps risk encouraging purchasers to buy imported fish which is, objectively speaking, less expensive? I say that because I believe that some negative effects that we do not wish to see could also occur. For that reason, although I am not today inclining towards one idea rather than another, I have to say that the seminar with the sector on that one topic may help us take into account all of the constraints, including the fact that it will, in my view, be rather unlikely that we shall ever have the power to change the common organization of the trade or GATT - we may want to believe that but frankly it seems to me to be rather unrealistic, not because I am someone who gives in easily but because, in those terms, the balance of power is, to be honest, overwhelmingly weighted against us.
Moving on to the measures to conserve resources, the Commission endorses many of the principles expressed by the rapporteur. But I would venture to say that, fundamentally, as far as financial assistance is concerned, what the report is basically proposing is more or less permanent compensation to anyone having to leave the profession. I have to say that the Commission is encountering huge opposition here, although it has sought - with some success, I believe - to introduce elements of social policy into the common fisheries policy, much against the will of some States, as Mrs Péry is, I imagine perfectly well aware; this is, moreover, of an optional nature, but now that the possibility is available to them, many Member States, although in favour, are not particularly disposed to make use of it.
At any event, I believe that this debate and those that follow will help us all to reach the stage that we have all to face - and the Commission certainly has to face - namely the 2002 reform, change or time-limit for the common fisheries policy. And for that, apart from the other reasons, I thank the rapporteur.
Turning now to the other two reports - on NAFO and the Antarctic. The Commission very much welcomes the report on NAFO, but the rapporteur will allow me to make two points: I have already said on a number of occasions in the House that the conflict whose political objective was, I am afraid, to expel the Community fleet from the NAFO international waters, has for the time being been resolved with the Community fleet which is within the NAFO zone. In those terms, I consider this a positive aspect at least. The overall package, which was then made multilateral in relation to all the monitoring measures and so on, has also, I believe, been a positive factor; like you, I realize that the current situation in relations between the European Union or, rather, the Commission and Canada appears to have improved but is far from satisfactory - quite the reverse. I therefore believe that we should persist in order to achieve a more balanced outcome, bearing in mind specifically that while things have certainly improved we are still a long way away, in my view, from a balanced and satisfactory state of affairs.
A third factor, however, on which I do not particularly agree, is that of the voting system in NAFO. I believe - and not just because I believe in the European Union and its importance - that it is better to speak with a single and authoritative voice than with six different voices and the dissonant tones of various Member States. I say this not just from a political point of view, because I believe that having a common fisheries policy means speaking with a single voice, otherwise it is not a common policy. I am concerned, particularly in an area as sensitive as fishing, about the differing positions of the various Member States because I am not certain that they are always moving in the same direction: in fact, I seem to recall that there have been occasions, when this was possible, when we took up positions that were not particularly in tune with one another.
As far as the other report is concerned, you Mr Arias Cañete know perfectly well that, currently, there are no Community fishing vessels operating in the Antarctic. That being so, it is frankly not possible to draw up a report on by-catches because there are no - Community at any rate - fishing vessels fishing in that zone. The Community has, as you know, been a contracting party to Commission for the Conservation of Antarctic Marine Living Resources since 1982, and I believe that, that being so, is already complying with the four amendments that you are proposing. I have already told you that I am unable to accept Amendments Nos 1 and 3 for the reasons I have already explained, nor can I accept the amendment concerning the programme of scientific observation which has been under way since the early 1990s. But what the Commission can undertake to do is to transmit the data as rapidly as possible; in fact, we shall also be able to look into the possibility of collating the data in a uniform manner - that is something we can do but, of course, using data collected by others.
The final report is Mr Kofoed's report. The Commission will keep Parliament informed about the measures adopted to safeguard the wild salmon stocks in the Baltic; it will inform the House of the progress achieved by the various working groups dealing with this issue; but I cannot accept the amendments proposed to the effect that the International Baltic Sea Fishery Commission should consider the possibility of providing for limited fishing of cod on top, as you will be aware, of the introduction of a TAC which is in fact one of the milestones of the common fisheries policy.
As regards the procedure for consulting Parliament, which Mr Kofoed backed, the Commission is quite prepared to inform the House of the deliberations of the different sessions of the International Baltic Sea Fishery Commission in real time, that is to say not immediately it receives the official documents. The Commission undertakes to do that: however, Mr Kofoed is aware that the House can express an opinion only on a formal proposal for a Council regulation that has been put forward, obviously, by the Council itself. That proposal is not submitted to the Council by the Commission until the 90 day period for raising possible objections has expired, that being the time-scale set down in the Baltic Convention.
I think then that I have explained the procedural issue and the simplification of procedure and have also entered into specific commitments on the provision of information, as far as the Commission is concerned.
Mr President, ladies and gentlemen, now that I have made those brief technical comments on the four reports, allow me to make a number of points on certain issues of a more general nature that have been raised in the House, particularly concerning the Commission proposal on POP IV. Let me begin by reminding you that Mr Arias Cañete had asked me to attend the committee on 29 May, something I could not do because that was the very day that the Commission discussed and approved POP IV: the problem was therefore that of being in two places at once, a problem I am, unfortunately, not yet able to resolve. Incidentally, on the afternoon of the 26th, the Commission will be taking part, at the chairman's invitation, in the meeting of the Committee on Fisheries which has on its agenda the elements of POP IV.
At this stage, allow me to mention three things: firstly, we have, clearly, a whole series of misunderstandings and, maybe, inadequate information. I am sorry, for example, that Ms Malone is not here, but I have no idea where she read that the structure of the fleet is not taken into consideration. That is not true, nor is it written down anywhere - quite the reverse. As you know, there is a general proposal to reduce the mortality rate of certain stocks. This is not a generalized reduction of 40 per cent of the European fleet - that is categorically not the case! The plan provides for a reduction in the mortality rate of certain stocks whose situation is more desperate, and that reduction can be achieved by cutting the fleet and/or by managing fishing.
That more general decision will be attached to the 13 national plans which the Commission will have to negotiate with the thirteen Member States. There is therefore an obligation to meet an objective, an obligation to achieve a specific result, to put in legal terms, but the way of achieving the result may be a combination of reducing fishing capacity and/or cutting down on fishing.
The objective of reducing the mortality rate by 40 per cent concerns some stocks whose plight the experts consider to be desperate. On this occasion, we had two committees of experts: the usual group and the Larsen group. I would inform the House - which is aware of this - that every Member State is in practice represented in those committees, that the decisions of the committees are taken unanimously and that, in the end, after having consulted two committees of experts, I have to believe someone, I cannot conjure up a third, fourth or fifth committee of experts! It is clear that, at an international level, there will always be some experts who do not agree with the conclusions of their expert colleagues, but sooner or later a decision will have to be taken on the basis of some data.
The third point: there are then stocks in which mortality rates will fall to a lesser degree because their situation is less serious; there are stocks for which reductions are not yet needed but in regard to which the Commission is proposing that there should be no increase as a result of improved technology: we have therefore a reduction over six years of 12 % - 2 % annually - to prevent increased fishing as a result of improved technology. These are arrangements that we are setting in place with the fishermen. I would point out that, before we submitted POP IV, we held 38 regional conferences with the fisheries sector. I repeat: thirty-eight. That proposal did not then come out of the blue: it, along with various other issues, was discussed in 38 regional conferences. But it may be said that that is not enough: of course, 50 is a larger number than 38 but there comes a point at which 38 seems to me in itself to represent a great effort. In addition, we set up meetings between the experts and the fishermen so that they could talk to each other, given that one of the objections is always that the fishermen do not believe the experts. Certainly, it is difficult to set up ten committees of experts!
Small-scale fisheries, which provide more jobs, are excluded from this programme. Non-industrial fishing is not therefore part of the programme specifically because the Commission does not consider itself a 'Super-Larsen' , that is having to deal with biological issues only; the Commission takes the view that it also has responsibility for mediation at a social level, to take account of the social impact. Therefore, small-scale fisheries, which provide more jobs, are not covered by the proposed reduction. But clearly, ladies and gentlemen, we shall, if you wish, discuss all of this again on the 26th.
As far as the gallineta is concerned, I can inform the honourable Member that that type of fish, which could be fished freely, has never been fished by the Spanish fleet. It began to fish scorpion fish - gallineta in Spanish - in November and December of 1995, no earlier. If I have to propose a TAC and a quota then I have to take into consideration a specific period and, as in the case of NAFO, the chosen period is five years. The honourable Member will allow that a fleet that began fishing two months ago cannot have the same quota as a fleet from another Member State that has been fishing that type of fish for years. I therefore think that a degree of reasonableness would really help everyone to act a little more responsibly.
A final point, ladies and gentlemen: I do not enjoy proposing cuts in the fishing effort, that is plain; I would rather be managing a sector in expansion. It may be self-evident but that is how it is. I urge you to believe that the proposed measures are the minimum needed to secure a future for that sector. It will be for the governments to take a decision: unanimously they can also reject the Commission proposal. But they know that, in terms of democratic transparency, we have all to shoulder our own responsibility. It is true that we must give the sector a sign of confidence, but ladies and gentlemen, we must be aware of the distinction between conveying confidence and conveying an illusion! There is a future for the sector, but on certain conditions: that it is able to modernize, that it is able to change, that it is able to meet challenges, including that of the globalization of the market and of technological change. We all have a responsibility to say this, because we can all do at least one thing, both you and I and the fishermen: increase the number of fish. That is just what we are not doing! And if there are no fish, then there is no sector for an industry which is one of your concerns, ladies and gentlemen, but - believe me, is one of mine too!

Cunha
I must thank the Commissioner for the information she has given us but my question remains unanswered. My question was: who gave the Commission the information used as the basis for the proposal for a 40 % cut in Portuguese sardine catches?

Izquierdo Rojo
Mr President, I would ask Mrs Bonino to read the transcript of my speech, where she will see that I did not refer to her at any time, and I am quite sure that she has fulfilled her duties as a Commissioner. I referred to a Spanish minister, criticizing the fact that she accepted a 20 % reduction of the scorpion fish quota at the start of the negotiations.
I said that this was a clear mistake on the part of the minister in question, but I did not refer to the Commissioner at all.

Gallagher
Mr President, I would like to ask the Commissioner if she would reply to the safety factor which is all-important. Safety should be the prime objective of the Commission, Parliament and the Council. There is a very serious situation in Ireland. If fishermen want to make their boats safer they are prevented from doing so because it is suggested by the Irish authorities and by the Commission that they are adding to the capacity. This is totally untrue. They are making them safer. They are not increasing the capacity of the vessel. They are not increasing the carrying capacity. They may be increasing the tonnage but there is no relationship between one and the other and Commissioner Bonino should take this matter on board and try to ensure that the boats are safer. We have an ageing fleet and this should be taken into consideration.

Fraga Estévez
Mr President, I do not like to speak in the European Parliament on domestic policy issues, but since a Spanish socialist Member has made some personal remarks about a Spanish minister, I think I have a duty to explain the problem to her.
It is not a question of a mistake by our minister. The fact is that for years, during the time of the socialist government, the Spanish fleet asked the Spanish Ministry of Agriculture and Fisheries for permission to fish for scorpion fish in the NAFO zone. The former socialist minister repeatedly refused that request. Now, with the establishment of a TAC and quotas based on historical rights, the problem is that unfortunately our fleet does not have historical rights in that fishery. That is the problem, Mrs Izquierdo Rojo. And it is not the fault of our minister, but of the former socialist government.

Bonino
Mr President, as usual, this debate on the fishing industry has aroused a great deal of interest.
Please forgive me, but many questions were asked which I was unable to answer individually, although we shall be seeing each other again on 26 June. With regard to the report containing the scientific data on sardines, this data has twice been passed to the International Council for the Exploration of the Sea, a body which brings together the leading scientists in this field, including those from Portugal. I described the situation concerning sardines - notably in Portuguese waters - in the House last year. The problem is not a new one, therefore.
As for the question on safety, MGP IV in fact provides for the establishment of facilities to increase safety at sea, provided these are compatible with the need to conserve resources. In accordance with Article 10 of Regulation No 3699, modernization of the fishing fleet, in particular for occupational health and safety reasons or with a view to the use of more selective gear, continues to be a priority of the structural programmes. This must not lead to developments which conflict with the aims of revising fishing capacity. It is therefore possible to achieve this goal, even under MGP IV.
I hope that this answers the question. I shall not go over the national issues again, except to confirm that this is the first time that a TAC for this type of fishery has been established. I would add that after a long debate, the Commission and the Member States have shown themselves to be reasonable and understood perfectly well who had historic rights and who did not. I have no wish to restart the debate, but I should simply like to clarify the Commission's proposal.

President
The debate is closed.
The vote on the four reports will take place tomorrow at 12 noon.

Practice of the profession of lawyer
President
The next item is the report (A4-0146/96) by Mrs Fontaine, on behalf of the Committee on Legal Affairs and Citizens' Rights, on the proposal for a European Parliament and Council Directive (COM(94)0572 - C4-0125/95-94/0299(COD)) to facilitate practice of the profession of lawyer on a permanent basis in a Member State other than that in which the qualification was obtained.

Fontaine
Mr President, ladies and gentlemen, the report which I have the honour of presenting to the House, on behalf of Parliament's Committee on Legal Affairs and Citizens' Rights, concerns the freedom of establishment of lawyers. This is a subject which we need have no hesitation in describing as thorny, given the intense debate, not to say controversy, to which it has given rise within the profession in question over the last few months.
Now, thankfully, the mood is one of conciliation, and it is against a more serene background, therefore, that I shall try to answer some of the basic questions that certain Members, at one time or another, will have quite legitimately asked themselves.
Firstly, why is a special directive for lawyers necessary, when respect for subsidiarity naturally remains a key principle? Quite simply because the Treaty has given us the task of ensuring the freedom of establishment of all the regulated professions in the countries of the European Union; and also because, for the last four years, the entire profession, with the sole exception of the lawyers of Luxembourg - a country which, as we know, is particularly exposed to the freedom of non-nationals to practise their profession - has been calling for this directive.
We asked them why, and I well remember our colleague Jean-Pierre Cot questioning the chairman of the Consultative Committee of European Bars. Their answer was that experience had revealed the shortcomings, limitations and inadequacies, as far as the profession of lawyer is concerned, of the general directive which Parliament approved in 1989, and which has been in force since 1991. Thus the aptitude test for joining the bar of a country other than one's own has frequently been used as an effective protectionist barrier.
Similarly, the right of lawyers to practise their profession permanently, under the professional title of their home country, on a basis other than the restricted and temporary context of the provision of services, is still being disputed. And while their freedom of establishment is subtly hindered in this way, the Union's lawyers are forced to watch powerlessly the proliferation in their own countries of large, multidisciplinary practices, of American or Japanese origin or inspiration, which are able to circumvent the obstacles and tap the European legal market.
The Commission heeded this call. It produced a proposal for a directive, which it submitted to Parliament in March 1995. In the very difficult circumstances of which the House is aware, this draft directive provided us with an initial working document, on the basis of which we have tried to square the circle, as it were. What does that mean? Although, as I have said, the desire for this directive amongst the profession was almost unanimous, opinions on what the directive should contain were sharply divided. Some wished the aptitude test for joining the bar of a host country to be retained and the permanent practice of the profession under the home-country professional title to be authorized. Others, conversely, wished the aptitude test to be eliminated and the practice of the profession under the home-country professional title to be restricted to a certain length of time.
If we have succeeded in this impossible task - and I have no wish, of course, to anticipate the result of tomorrow morning's vote in plenary - if we have succeeded in reconciling the irreconcilable, in securing the support of a large majority for the broad outlines of a consensus, then I have to say that it is thanks to the tremendous sense of responsibility demonstrated by every member of our committee. We were guided by two imperatives: the need to listen carefully to the profession; and the need to respect the spirit and the letter of the Treaty, as clarified by the case law of the recent Gebhard judgment. And we were guided, I would add, by a common political will to achieve a result.
I should like to tell you, ladies and gentlemen, that I appreciated this cooperation greatly. Things were not easy for any of you: neither for our German colleagues, nor our British colleagues, nor our Spanish colleagues, nor for your rapporteur, particularly in view of the fact that she is a national of one of the - let us say - more reticent Member States with regard to this issue. We all knew that concessions had to be mutual and that, at the end of the day, no one could be entirely satisfied with the result.
I should also like to pay tribute to the very great political awareness of Commissioner Monti, who understood and accepted the necessary amendments that we proposed to him.
You accompanied us, Mr Monti, with a great deal of attention and political intelligence, down a road which was nevertheless full of pitfalls. In my capacity as rapporteur, I thank you.
I sincerely believe that the compromise that we have adopted is well balanced. Integration into the host-country bar is facilitated by the elimination of the aptitude test. However, the competent authority of the host Member State will be able to verify that the lawyer in question has been practising seriously and effectively for the requisite amount of time. The right to practise without a time restriction under the home-country professional title has been accepted, but a Community national who declines to join the host-country bar and chooses to practise under his home-country professional title alone will be subject to the same professional and ethical rules as his counterpart in the host-country bar. In this context, I should be grateful if Commissioner Monti would clarify this important guarantee for us. Finally, provision has been made for joint practice, but we have taken care to protect lawyers from any danger of unfair takeovers by other professions.
If tomorrow, as I hope, the House votes in favour of this compromise, I trust that it will help to dispel, once and for all, both the fears and the whiff of protectionism which may persist in some quarters. Because it is a matter of urgency for the European legal profession to organize itself in order to adapt to the inescapable reality of the globalization of world trade. It is a matter of urgency for the Union's lawyers - taking advantage of the new freedom offered by this directive - to forge organic links between their practices and set up European practices which are capable of resisting the competition of large firms from outside the Community.
Finally, it is a matter of urgency for them to build a European partnership, so as to be able to raise the level of their services further still and meet the challenges that will face this especially noble profession in the coming years, which is so eminently symbolic of European democracy.

Rothley
Mr President, I should like to begin by complimenting Mrs Fontaine on her diligence and care in drawing up this document, and on her cooperative spirit, which has ultimately led to an excellent result. I would appeal to Commissioner Monti: we really did not take this matter lightly, and we have, I believe, achieved a very good result. The legal profession needs this directive, and I hope that the Commission will soon express an opinion on this matter and follow Parliament's proposals if at all possible.
Things are moving at last in the European legal profession. The internal market has given rise to a good deal of cross-border economic activity: the creation of companies, mergers, subsidiaries and partnerships. In addition, people are engaging to a growing extent in cross-border activities which are not merely economic. Lawyers have seen themselves for too long as a part of their own national judicial system, and not as consultants whose services are also needed across borders.
I am extremely grateful to the CCBE, the association of European lawyers: it has made a major contribution to a fresh understanding of legal practice, and has been arguing for more than a decade in favour of facilitating the freedom of establishment for lawyers in other Member States. Without the persistence and the helpful suggestions of the CCBE on the proposal for a directive which is now under discussion, we would not have reached this stage.
In the mid-1970s, in its landmark judgment in the Reyners case, the European Court of Justice ruled that legal practice was covered by the freedom to provide services and the freedom of establishment. Twenty years later, we are at last making this principle of primary Community law a reality, at least in respect of the right of establishment.
After the 1977 directive on the provision of services and the 1988 directive on the recognition of higher education qualifications, the results of which - as the Commission has acknowledged - have not been satisfactory in practice, we now finally have a proposal for a directive to facilitate the establishment of lawyers. This directive is a necessary one: firstly, it makes it clear that lawyers can establish themselves permanently in another Member State and practise the law of the host country, under the home-country title. This did need clarifying, because despite the Court of Justice ruling of 30 November 1995 in the Gebhard case, doubt is still being cast on this right. I would therefore draw attention to what is probably the most important sentence in that judgment: membership of a professional body cannot be regarded as a constitutive element of establishment.
Secondly, the integration of lawyers wishing to join the bar of the host country is to be facilitated. They will no longer be expected to sit an aptitude test under the directive on the recognition of qualifications, but will be able to prove their aptitude by practising the profession for three years. I would stress that this arrangement is in line with the case law of the Court of Justice, which made an important judgment in the Vlassopoulou case in 1981, at the time when the directive on the recognition of higher education qualifications had just been transposed. This judgment obliges the Member States to take account of the title acquired by the lawyer in the home country to practise the same profession. Should the knowledge and skills of the lawyer not correspond to the specific knowledge required in the host country, that country can demand that it be acquired differently, for example through practice. This judgment therefore entitles lawyers to prove their ability by means of successful practice.
Thus the Vlassopoulou case forms the basis of the provisions for integration into the bar of the host country, as proposed by the Committee on Legal Affairs and Citizen's Rights. The arrangement proposed by that committee, approved by a large majority of its members, is a fair and liberal one. It is also courageous. It demonstrates that European spirit which is so often lacking nowadays. And since I have just said that the committee's proposal is a courageous one, I should now like to thank Mrs Fontaine not only for her diligence and her care, but also for her courage!

Lehne
Mr President, ladies and gentlemen, I really do believe that the directive being discussed today at first reading is a very important one. There still remain a number of professions within the European Union - albeit not many - to which the rights of freedom of establishment and freedom to provide services, as laid down in the Treaty, have not so far been applied. Lawyers have until now belonged to this category, since there have naturally been restrictions on the practice of the legal profession because of the differences between legal systems.
I therefore warmly welcome the presentation of a directive which will solve precisely this problem, and will in principle grant lawyers the rights enjoyed by all other European citizens in the practice of their professions in Europe. These provisions are long overdue, and represent a major step forward. And that is no doubt why the vast majority of lawyers have expressed support for such a directive becoming European law in the near future. It is, however, only natural - and what else could one expect of lawyers? - for there to be disagreement as to what should be included in this directive, and how the problems should be solved. Within the legal profession, there has been some dispute about how, but not whether, to proceed. It has therefore been the task of the committee, and tomorrow it will be that of the House, to resolve this dispute over the approach. I believe that thanks to the help and the willingness to compromise of everyone concerned throughout the discussions, in particular the rapporteur, the Legal Affairs Committee has produced what is a truly viable compromise.
There were two main points at issue: firstly, whether or not to retain an aptitude test. Our view here was that in principle a test can be dispensed with, if a lawyer can provide evidence of sufficient practical experience in the country to which he moves. This was a courageous decision, and one which runs counter to what is to some extent a majority view among both the legal profession and the governments involved, whose opinions will be sought again in the course of the legislative procedure.
The second point was the question of so-called compulsory integration. Here the Commission originally proposed that after the expiry of a certain period of time, the lawyer must have an opportunity to decide either to become a full member of the local bar or to return home. The committee decided to abandon this principle of compulsory integration, simply because it was our unanimous view that this is not in keeping with the principle of proportionality. It is illogical to allow a lawyer to practise in a foreign country for a certain period of time and then, merely because a certain period has elapsed, to tell him that he may not do so any longer unless he applies formally for membership of the bar. The committee proposes that the House should take a decision on this important point as well.
My group and I believe that it should be possible to find a compromise in the Council on the proposals contained in this report, and that after everything we have heard today from the legal profession throughout Europe, they should be broadly acceptable in principle. I would therefore appeal to the Council not to block - by failing to act - an important decision in the interest of this group of professionals, but to carry forward this draft legislation in the Council on the lines which I hope will be approved here tomorrow by an overwhelming majority, and to adopt an appropriate common position on this proposal.
In the light of our discussions with the Commission, I take it that the Commission is likely to accept in principle the amendments tabled by the Committee on Legal Affairs and Citizen's Rights, even though it has not yet stated its views officially. But it will no doubt do so over the next few days, or indeed at our sitting today or tomorrow.
All things considered, the PPE Group supports this report in the amended form produced by the Legal Affairs Committee. The amendments represent a broad compromise between national interests, the interests of lawyers, and also between the different views of the political groups.

Florio
Mr President, Commissioners, ladies and gentlemen, the UPE Group, which I represent, supports the spirit of this proposal which was approved by our committee. I must therefore take this opportunity of thanking Mrs Fontaine for the very valuable work she has done and also add my thanks to those extended by Mrs Fontaine to Commissioner Monti for the assiduous and helpful assistance given to the Committee on Legal Affairs in drafting this important proposal. Personally, I believe that the compromise achieved, which basically satisfies even the point of view taken by the European lawyers' organization - and it is appropriate to stress that - is of a kind that will encourage expansion in the forensic profession and enable it to face up to the competition that is feared from outside the Community, as Mrs Fontaine herself said.
Those who spoke before me underlined the new elements as compared with the Commission proposal these basically consist in abolishing the aptitude test which seemed to mark some kind of attempt to reintroduce through the back door the kind of protectionism which was meant to go out of the front door, and also abolition of the principle of compulsory membership of the professional register of the host country.
I believe that this directive, if approved in the terms in which the Commission has adopted it, will help the forensic profession, as I said earlier. I would like to voice a hope from this side of the House: I have ascertained that of the fifteen Community countries only two, one of them my own country, still exclude the possibility of exercising the profession in company format. I therefore hope that the domestic legislation of those two countries also will be able to rectify what I consider to be an obstacle to the modernization of the profession.

Wijsenbeek
Mr President, I am very glad to see our rapporteur in this role, as we have just had an eventful time together in a conciliation procedure, but now I can contradict her a little in the open.
Mr President, the rapporteur talked about squaring the circle and finding an acceptable compromise with which everyone could be happy, because it ultimately gives everyone freedom of establishment. But for the Liberals this is not enough, because we do not believe that there is any reason why there should be different rules for lawyers from those which give any other professional group freedom of establishment in the European Union. Why can doctors, who deal with life and death, move from one Member State to another and look after patients there, whereas lawyers cannot? I simply do not understand it. But the answer is, of course, as it has always been: professional groups tend to wish to protect themselves from outsiders and adopt protectionist practices. And unfortunately there are still traces of this protectionism here in this directive in the form of the equivalence test, just like in the Cassis de Dijon case, rather than relying on mutual trust. There is still only a limited right of establishment for people to practise under the home-country title, and we wish to see equal treatment for everyone throughout the Union.
We have tabled a number of amendments on this subject, and we hope that the rapporteur and the House will respond favourably to them.

President
The debate is adjourned and will resume after the evening suspension.
The next item is Question Time.

Question Time (Commission)
President
The next item is Question Time to the Commission (B4-0566/96).

President
Question No 40 by Mark Killilea (H-0435/96)
Subject: Termination of the EU's Helios programme
Will the Commission confirm that the EU's HELIOS Programme for the disabled is to wind up at the end of this year?
Can it confirm that the staff in the HELIOS Brussels office have already been told that they are to be let go by the end of the year?
Will it also confirm that it does not intend to renew the programme for a further 4 years, and that there is no comparable programme being put forward to replace it?
Given that there will be no successor HELIOS Programme for the foreseeable future, will the Commission formally and extensively consult disability groups on what action they want for follow-up programme? Why has there been no consultation on these proposals?
Disability is the first programme to be abandoned by the Commission because of the problems with Article 235. Is this an indication that disability is a low priority with the Commission?

Flynn
The Commission has been active for many years in promoting better living and working conditions for people with disabilities. As has been clearly indicated in its White Paper on the future of social policy and its rolling social action plan, the Commission is committed to a continued strengthening of the Community's contribution in this field. Already the potential of the structural funds in supporting people with disabilities has been enhanced.
In addition to the HORIZON employment initiative, significant resources are also targeted on people with disabilities through the mainstream structural fund programmes. Quite clearly therefore it is the structural funds, and in a very special way the European Social Fund, which constitute the most important financial instruments at Community level for improving the situation of people with disabilities and the Commission is anxious to build on this.
As far as HELIOS is concerned, the Council decision on 25 February 1993 establishing the HELIOS II programme provided that the programme was to be carried out in the period 1 January 1993 to 31 December 1996. Consequently, the contracts with outside experts assisting the Commission in implementing the programme will finish at the same time as the programme itself. The final evaluation report on the implementation and results of HELIOS II will not be available until the middle of 1997. Pending that evaluation it would be premature to propose any further programme of the HELIOS type.
In the meantime, however, the experience of, and the lessons learned to date from, HELIOS II are being actively considered by the Commission in the context of a review of its overall strategy in this field. Although, as I have already mentioned, the final evaluation report of HELIOS II will not be available until well into next year, it is already possible to set out the overall strategy to provide both continuity and reinforcement of its action. The Commission recognizes that the European Parliament, the NGOs and, most importantly, disabled people themselves have high expectations of continuity of effort in this regard. Accordingly, a communication setting out the main lines of its strategy will be issued by the Commission in the near future.
Finally, with regard to consultation of groups representing the concerns of disabled people, the Commission fully recognizes the value of the communications, practices and the experiences developed within the HELIOS programme, and by the NGOs and the European networks dealing with disability issues. The Commission intends to consolidate and further develop its links with these in a common endeavour to encourage the development of better policies and the implementation of better practices throughout the European Community. In this context the House may be assured that future strategy and any new initiatives will be discussed with the disability groups and, in particular, with the European Disability Forum.

Killilea
I thank the Commissioner for his reply. I want to compliment him on the wonderful work he has done to help the disabled since he came into office and also on the recent statement in Mayo concerning the funds that should and could be spent by national governments for the disabled.
I have a few points. Is it not rather odd that it takes until the end of the HELIOS programme before an assessment is made? Could it not have been made to coincide with the ending of the HELIOS programme? Then perhaps, in a different form but with the emphasis on the same strategy, the HELIOS could be applied under a new name in the mainline programme which is to be announced by the Commission in the very near future as outlined by the Commissioner. I would make the following suggestion. It is fundamental in the allocation of structural funds or other major programmes that the amount of money available for the physically disabled should be identified.
(The President urged the speaker to conclude) I am sorry, Mr President, but I am sure you, unlike the Council, can allow a few moments for the disabled and less well-off in our society.

Flynn
I thank the honourable Member for his interest in this matter. I can assure him that it is a shared interest. He will be aware that the programme runs out at the end of December. The full evaluation will take place some months after that. It was not possible of course to carry out the evaluation until the programme was finally completed. I must tell Mr Killilea that we have an interim evaluation on the HELIOS II programme which was carried out by independent experts. They highlighted a number of problems. Consequently, I think it is much better that we have a really dedicated programme on the next occasion so as to take full advantage of that evaluation and the further details in the final evaluation.
As regards finance, the HELIOS II programme was designed to co-finance the exchange of ideas simultaneously right across the Union and so it nicely complements the European Social Fund which cofinances innovative action in the Member States. I am trying to get a better understanding between the cofinancing for the international networks and the co-financing at Member State initiative level. As you know, in the preliminary draft budget some ECU 6m has been allowed under heading B 34102 for 1997. That is a proposal for the preliminary draft budget. It has been adopted by the Commission as a whole but it does not commit the budgetary authority. The budgetary competence for non-compulsory expenditure rests with Parliament and it can take its own decision in that regard.

Titley
I am more confused now that I have heard the Commissioner than I was before. Could he answer some simple questions. Is there going to be a comparable programme in the future? Is disability a priority of the Commission? Will there be continuity from the HELIOS II programme? It sounds to me as if HELIOS II is going to come to an end, the Commission is going to think about what it might do in the future and then it hopes the issue will disappear. Is there going to be continuity? Is it a priority of the Commission? Will there be comparable programmes in the future?

Flynn
Let there be no confusion on this matter. The question of disability and what can be done to help people with disabilities is of the highest priority for the Commission. Let that be clearly understood by everybody.
It is certainly our intention to have another programme. There will be continuity of understanding and consultation with the people with disabilities themselves. We do not want to go into the next programme until we have completed evaluation of the existing one. That is why we are taking some time to consider what is the best way forward and to get the best synergy possible. It is the highest priority and because it is the highest priority we are not just allowing a follow-on of what has been done heretofore because some uncertainties have been identified in the interim report.

Crowley
I also wish to join in the thanks to the Commissioner for his work in the area of disability and in particular to welcome his commitment to involve the NGOs in the area, especially the European Disability Forum.
He mentioned that it is a priority within the Commission. I think everybody accepts that as true. In his discussions with the Italian presidency and the incoming Irish presidency, has he had any commitments from them that it will also be a priority for the Council?
Secondly, is it possible to remove the blockages which have been put in place because of dependence on Article 235 by Member States, particularly in programmes that relate directly to alleviating the poverty traps which disabled people have fallen into because of the lack of work at national level? If not, then what are the proposals from the Council - especially the incoming Irish presidency if it has any - with regard to implementing a new article to ensure that these social action programmes can be undertaken?

Flynn
Firstly, I should confirm here that I have heard nothing to suggest that any less priority would be given to people with disabilities and to what can be done for them by either the Italian presidency or the incoming Irish presidency. On the contrary, I have only heard very positive remarks at all times concerning what can be done.
There is the continuing situation with regard to Article 235, as the honourable Member has mentioned, and I have to say that Article 235 is the only possible legal base for the actions that are carried out under the current Helios programme. The House knows very well the difficulty we have been having concerning some of the social programmes insofar as the use of Article 235 is concerned. It should be stated here that the Council's Legal Service has confirmed the principle of using Article 235 to achieve Treaty objectives where there is no specific legal base. We might also note that the European Parliament's Committee on Legal Affairs and Citizens' Rights made a similar recommendation when we talked about the programme for the elderly and that there was no other adequate legal alternative. So I was perfectly satisfied that Article 235 is quite sufficient and proper in these circumstances.
You can rest assured that everything will be done to promote this matter as effectively as possible under the Irish presidency.

President
Question No 41 by Ivar Virgin (H-0412/96)
Subject: Closure of nuclear power plants in the EU on safety grounds
Have all nuclear reactors in the EU been fitted with pressure-reducing filter systems so that even major accidents do not pose risks to the public?
Do grounds exist for shutting down any reactor in the EU as a result of safety requirements not having been complied with?
Is there any safety-related evidence which is giving the Commission cause to consider recommending that a reactor be shut down in any country?

Bjerregaard
There are various kinds of safety measures, systems and procedures which are needed to limit the effect of a serious accident on the reactor shield, depending on the type of reactor and the national legislation in this sector. Such measures are provided for at all the nuclear power plants in the Community where there could be a risk of excess pressure within the shield. The national nuclear safety authorities ensure that the safety standards in their countries are complied with. All those Member States with nuclear power plants also have qualified, independent nuclear safety authorities which issue operating licences and, if necessary, order plants to be shut down. At present, the Commission therefore has no plans to recommend the closure of any nuclear power plants in the Community.

Virgin
Thank you for your answer. The background to my question is the fact that it was decided, in connection with the very intensive debate we had in Sweden at the beginning of the 1980s after the Harrisburg accident, to invest in safety measures of the kind I mentioned in my question, namely pressurereducing filter systems.
As the question undeniably is of more than national significance I believe it would be reasonable for the Commission to take an active interest in these issues. I should therefore like to ask if the Commission actively supports plans to make this kind of safety investment in other countries. My judgement of the matter is that, precisely as a result of these safety investments, the Swedish public have a confidence in nuclear power which they would not have had, or would have been unlikely to have, if the investments had not been made.

Bjerregaard
I agree with the questioner that it is important, when it comes to the development of nuclear power, that the population should have confidence in what is being done, and there is no doubt that safety measures play a very significant role. The Commission therefore also supports the safety measures taken by the Member States. The situation is that under the Euratom Treaty, the Commission does not have the authority to intervene and introduce common safety standards for the Member States, but through the various resolutions which have subsequently been adopted, we have been given scope for cooperating with them to secure mutual recognition of the various national standards. This means that in many areas, a common stance has been formalized to some extent on these important safety-related matters.

President
Question No 42 by Anita Pollack (H-0448/96)
Subject: Potential trade war between Italy and the USA
What is the Commission doing about the USA threat to stop importing all fish products from Italy by 28 July unless Italy stops all illegal driftnetting?

Brittan, Sir Leon
On 28 March 1996, following a ruling by the United States Court of International Trade, the United States identified Italy as a country engaged in large-scale driftnet fishing in international waters. As a result sanctions may be introduced against Italy. The timing of US internal procedures allows 30 days from 28 March for consultations between the United States and Italy, with a further 90 days to reach agreement. In the absence of agreement the United States has 45 days in which to apply sanctions, which would take the timetable of the procedure to early September.
The Commission sent a diplomatic démarche to the United States State Department on this issue, which states that the Community shares US concern over the incidental death or serious injury to marine mammals caught through drift-net fishing whether large-scale or not, but reiterates Community opposition to the extra-territorial application of US jurisdiction. The Community also stresses that such unilateral trade sanctions contravene the basic principles of the WTO and the United States' obligations within that organization. The Community reserves its rights under the WTO should such trade sanctions be introduced by the United States.

Pollack
I thank the Commissioner for his fairly predictable reply. I wonder if the Commissioner would have come to Parliament about this issue if we had not asked the question first? We have about US$1 billion worth of products involved here, including jewellery and perfume as well as fish products. We really need to know what the implications are for multilateral trade agreements.
Does the Commission think it might be useful to try to persuade Italy to stop using illegal drift-nets? While we have EU rules which limit drift-nets to a maximum of 2.5 kilometres in length, is the Commission aware that the Italian swordfish fleet uses nets as long as 20 kilometres? Scientific studies show that less than 1/5 of the targeted species that are caught in the nets are actually used, while the rest of the catch is often thrown back dead. So what is the Commission going to do to persuade Italy to put a stop to this very sorry state of affairs?

Brittan, Sir Leon
The Commission has started infringement procedures against Italy as provided for under Article 169 of the Treaty. The issue will soon be raised again with the Italian authorities. I hope that a satisfactory outcome can be achieved without delay. If that is not the case, then the Commission will proceed with the case to the Court of Justice in the normal way.

Imaz San Miguel
As Mrs Pollack has already indicated, there is a clear risk to the Community fish market in connection with this issue, since the amounts at stake in a ban on the import of fish products into the United States would be in excess of PTA 100 000 million. It should also be borne in mind that the same organization which brought this matter before the US Court of International Trade is also investigating the activities of the fishing fleets of other Member States using drift nets in the Atlantic. Consequently, should not the Commission take this matter seriously and consider that the way to avoid these possible sanctions, which may have a serious impact on the Community fish market, is to ban the use of these nets, the illegal use of which may cause substantial damage to the entire Community fish market?

Brittan, Sir Leon
The position is that under United States' legislation, if the matter is not resolved, the United States would and could introduce sanctions against marine products from the Member State concerned, that is from Italy. We do not regard that as justifiable for the reasons that I have given and reserve the right to take action in the World Trade Organization to deal with that situation should it arise, although it has not arisen. I hope it will not arise because we also take the view that the action that has taken place is contrary to Community law and it is for exactly that reason that we have started infringement procedures against Italy.
I share the concern expressed about the infringement of the law and, therefore, I very much hope that the issue can be resolved by Italy causing the necessary action to be taken for the procedure not to need to go forward and therefore, of course, the United States' sanctions also not to proceed.

President
Question No 43 by Wolfgang Nußbaumer (H-0446/96)
Subject: Standards and regulations on certification
What is the Commission's assessment of the effect on competitiveness of the numerous and different standards and regulations on certification within the European Union and what measures does the Commission intend to take in this connection?
How does the Commission guarantee that a standard which does not meet the fundamental requirements provided for in directives, but which is referred to in the Official Journal, conforms to Community provisions?

Bangemann
Mr President, standards are in the first instance private norms, in that they are drawn up by standardization organizations but do not generally have a binding effect. They can of course become binding if the Commission makes them mandatory and incorporates them into safety provisions, but that only happens in exceptional cases.
The existence of different private norms alongside one another is of course damaging, and that is why we set up the three standardization organizations CEN, CENELEC and ETSI, whose workload has increased substantially. At first, the formulation of these European standards, which replace a multitude of national standards, made a slow start. After all, every standard requires technical preparation. More recently, however, these bodies have been working very effectively: over 1000 European standards per year are currently being produced, which means more than four standards every working day, and that is a considerable number in view of the sometimes difficult technical preparatory work. It is not too many, though, because these standards do replace a whole multitude of national standards. Cooperation with national standardization bodies is also very good. The CE mark, which is not a quality standard, but simply confirms that a product meets the European standards, is being used increasingly, and is also having an impact on the certification procedures serving the needs of the internal market.
In principle, the standards drawn up by these organizations have no technical flaws, and this is ensured by the fact that they are checked by independent experts from outside these bodies. However, should a standard exceptionally fail to meet the relevant basic requirements in full, it is withdrawn by the Commission, once its shortcomings have been noted and after the appropriate consultation procedure has been followed.

Nußbaumer
Thank you for your answer, Commissioner. I am always being told that many SMEs are deterred from patenting their inventions by major procedural and, above all, financial obstacles put in their way by the relevant authorities. How can the Commission encourage the Member States to reduce their red tape, thus removing the competitive disadvantages suffered by European firms, especially in relation to American and Japanese companies, and giving them an incentive to develop new processes and products?

Bangemann
First of all, to my mind, one must distinguish between standards and patents. It is of course very much to the advantage of small and medium-sized firms to apply standards, so as to offset to some extent the disadvantages which they suffer in calls for tender because of their size. In order to make smaller firms more aware of standards and facilitate their application, we are working closely with an association created by small and medium-sized enterprises, whose brief is to ensure that these standards are known and complied with during the production process. I believe that, as a result, more and more small firms will begin to apply standards.
Patents are of course something quite different. I do not know whether that was a slip of the tongue, because patents have nothing to do with standards. Naturally, a patent must be registered in accordance with certain procedures. This is done either nationally or through the European Patent Office, which is increasingly taking over the work of the national patent offices. It is true that the fees charged are sometimes fairly high, which in the case of the European Patent Office - where we have a certain amount of influence - is due to the fact that the Office is funded entirely from these fees. The European Parliament itself regards it as essential that such authorities and agencies should be funded out of their own revenue, and clearly this is a financial burden which we cannot reduce.

Meier
Commissioner, to what extent does European standardization go hand in hand with international standardization, given the fact that over 40 % of European standards have already been recognized internationally? Is it not our duty to respect not only the three standardization bodies in Europe, but also the worldwide standardization network, for example in the telecommunications sector?

Bangemann
The honourable Member is absolutely right. What you say is indeed logical, and ideally standards would be applicable internationally. In many sectors, we already have a global market, and you rightly mention telecommunications. Together with the European standardization organizations, therefore, we are attempting to ensure that these standards apply worldwide. In practice, there are two ways of doing this: the first is to participate in the work of the international standardization bodies which already exist. Here we are more active than anyone else: for example, almost 80 % of the work leading to such international standards - and, incidentally, of the financial resources too - is provided by the European Union. I myself would not have thought this massive percentage possible, but at a meeting with our American friends, who have always accused us of seeking to use our European standards as a form of protectionism, we looked into who does what in the international standardization bodies. The Europeans carry out the bulk of this work.
Secondly, there is a method which is very effective once a standard has already made an impact on the market. The best example of this is GSM, the technical standard for mobile communications. Once such a standard has made its impact on the market, this impact spreads to the global market, and we hope that many of the standards which we are drawing up in this new sector - telecommunications - will have a global impact.

President
Question No 44 has been withdrawn.

President
Question No 45 by Allan Macartney (H-0336/96)
Subject: Commission policy and criteria with regard to the need for NGOs to have expatriate presence in the countries where they work
Many NGOs work through local organizations in developing countries, in recognition and support of the experience and capacity that exists in those countries. In the past, the Commission has supported this approach and encouraged European development NGOs to work with local counterparts. In the fields of food aid, rehabilitation and longer-term development, the Commission has on numerous occasions stressed the importance of civil society and private initiatives in developing countries. Yet, on other occasions, Commission services have turned down applications by European development NGOs on the grounds that those organizations do not have sufficient expatriate presence in the country concerned.
What criteria do the Commission apply in determining whether there is a need for European NGOs to have an expatriate presence in a particular country?
What are the advantages for the Commission and for the NGO programmes of the use of expatriate European staff as opposed to staff of local organizations?
Does the Commission agree that, in the light of its discussions on the linkages between emergency aid, rehabilitation and long-term development, there is added value in strengthening local organizations by working through them?

Pinheiro
Mr President, the Commission entirely agrees with Mr Macartney that it is important to strengthen local organizations and enhance their role in guaranteeing the linkages between emergency aid, rehabilitation and development. The importance of this aspect was especially highlighted in the recent Commission communication to the Council and the European Parliament on this very issue. Generally speaking, the Commission bears in mind, as far as possible, the need to strengthen and implicate local partners in the execution of the various financial instruments.
Against this background, as far as possible, NGOs must resort to local staffing, as mentioned in the very conditions of co-funding for executing structural development projects. It is obvious that this approach must be adapted according to the specific aims of the different budget rubrics and in situ conditions.
When assessing requirements for an expatriate presence for a given project, the Commission bears in mind the objective of the given project, the country's logistic and technical capacity in terms of the planned action, the experience and financial management capacity of the beneficiaries. As a result in emergency situations and/or during the rehabilitation stage in countries which have just undergone serious crises and whose political, economic and social structure has suffered profound upheaval, it may be necessary to resort to a greater expatriate presence than, for example, in normal development stages. Resorting to expatriate aid workers is usually done so along with a unit of training staff to teach the local people so that the project's viability in the medium or long term can be guaranteed once the foreign staff have left.

Macartney
I do not know whether to be reassured or otherwise by the Commissioner's response. He seemed to be saying all the right things. If I could just clarify it a bit, did I correctly understand him to say that, other things being equal, he would prefer to rely on local staff in NGOs rather than having Europeans acting to some extent as minders, which I take it could well be the perception? The reason I ask that is because, after many years of decolonization, there is still an impression in some countries that the European Union has not changed its basic mentality. I hope I am wrong and perhaps he could confirm that I am wrong in that regard.

Pinheiro
Let me reassure you that you are right in your concerns but wrong in your subsequent conjectures. In fact, in 1995, of the 67 projects which we financed under the budget lines that are mainly concerned with rehabilitation and crisis management, only seven of those projects fell into the category to which you referred in your question, in which reinforcement of European personnel was required. The reason was that the administration was in a shambles and it really was not possible to carry out some essential projects if we did not contribute some expertise of our own. But the principle is that unless there is a local partner - we always try to be the main force in the project - we simply do not finance the European NGOs. This is a very strong principle. You will see that in the report we are presenting to the Council and Parliament at the beginning of next year that this is set out as one of our main objectives. Thank you for the question because it is an important one.

President
Question No 46 by Marianne Eriksson (H-0461/96)
Subject: Development aid policy
An increasingly small proportion of EU aid goes to the world's poorest countries, most of which are sub-Saharan ACP countries. The EU's insistence on giving priority to aid to Eastern Europe and the Mediterranean region is being pursued at the expense of the very poorest countries.
What is the Commission's position on this problem?
Does it intend to endeavour to change this state of affairs and, if so, how?

Pinheiro
Mr President, European Union aid to sub-Saharan Africa is comprised, as you know, of resources earmarked in the Union's budget and the European Development Fund which, as you know, too, is currently and against the will of the Commission not yet receiving European budget funding because of the Council's refusal. The authorizations granted in the framework of the European Development Fund have continuously increased. Under the VIth Fund the funding levels reached 7.5 billion ECU rising to 10.9 for the VIIth and 12.8 for the VIIIth. In other words, the funding for the EDF has gone up by almost 20 %. The share of g overseas aid taken up by the Fund has remained steady since 1991, around 45 % of all Community overseas aid. This is important and especially so since of the 48 least developed countries identified by the UN, 40 of them belong to the ACP and are funded in terms of overseas aid by the European Development Fund.
As far as the Union budget is concerned, the importance attributed to the ACP countries and especially the poorest ones in the framework of aid and cooperation policies has likewise not gone down over recent years. Indeed the Cannes summit set a share-out of aid among various geographical groups, namely the countries of Central and Eastern Europe, the Mediterranean, ACP countries, Asia, Latin America, the former Soviet Union and former Yugoslavia. This share-out will remain in effect until 1999 and nothing suggests that it will be changed to the detriment of resources earmarked for the ACP countries. European Union aid to the countries of Central and Eastern Europe is indeed important and has steadily increased since 1990. Resources for the Mediterranean region will also increase substantially given our new Euro-Mediterranean partnership. But I should like to emphasize that none of this has bene to the detriment of the ACP countries. I have given some figures but I should like to emphasize that translated into dollars, the currency usually used for development aid cooperation, the increase from the VIIth to the VIIIth EDF budget was almost 50 %. When translated into local currencies - i.e. purchasing power on the ground - the increase is far greater than 50 %. In other words, ladies and gentlemen, I can say with some certainty that the number of projects which the European Union will be able to fund under the VIIIth EDF will probably will half as much again as those funded under the VIIth Fund.

Eriksson
I should like to thank you for your answer. What you said was not unexpected, I must admit. One of the reasons I asked the question is that the Swedish government has now decided to make cuts in aid in Sweden, partly on account of the EU aid programme.
I have examined EU aid with this in mind. Even though I can agree with the Commissioner that in ready money the changes are not so large, it is clear that it is emergency aid which the European Union has agreed to which is also at the expense of more long-term development projects. I therefore believe that my question still requires an answer. Am I making a correct interpretation, does the Commission share it and if so, how does the Commission intend to work to improve things for the 20 poorest countries in the world today?

Pinheiro
Overall public expenditure on aid by the international community has decreased over the last decade, not because the European Union and its Member States have decreased it - on the contrary, we have increased it - but because some of the major donors, namely the United States of America, have dramatically decreased their contribution and also because the Japanese, who were one of the major contributors, decided after the Kobe earthquake to reduce their aid commitment.
The second aspect which I would like to underline is that the multilateral approach is not a substitute for some of the bilateral approaches. In that regard I have been urging Member States that we should coordinate our efforts and find ways of working together and that there should be no decrease in the bilateral effort which has been crucial in many countries and places for many different reasons. The Nordic countries especially have set an example of very good cooperation, especially in ACP countries and through some of the best NGOs we have working in the ACP countries. I therefore hope that Sweden, as one of the main countries that has pursued that policy, will continue to do so in future.
A second aspect concerns the poorest countries. The Commission has decided that the funds provisionally earmarked for the next five years should allow for a greater increase for the poorest countries - the poorest of the poor. Therefore we established a system that means that of the poorest countries no-one will get less than a 25 % increase in their EDF funding. Most probably they will receive 50 % more in the five years to come as regards the EDF financial envelope. Why have we done this? Among other reasons, because we have two tranches in EDF spending. In principle the poorest countries will be less able to absorb it and therefore it will be the better off that will get some extra money in the distribution of the second tranche . In creating this imbalance in favour of the poorest countries at the beginning, we have tried to make sure that the overall balance is not destroyed at the end of the next EDF.
Nowadays not only the quantity of resources available is crucial but also the coordination. That is the reason why the Commission is now engaged in a very intensive coordination effort with Member States and other international donors, namely the World Bank which, as we know, is one of the main donors, and also United Nations agencies such as UNCTAD, UNIDO, UNICEF, FAO and others. It is a deliberate policy which is already paying off. I will be able to come back in September after a seminar we are holding with the World Bank to report on the common action that we have decided to undertake in order to maximize the resources available for assistance to the ACP countries.

President
Question No 47 by Graham Watson (H-0317/96)
Subject: Microsoft monopoly
Is the Commission aware that Microsoft is exploiting its monopolistic position in the computer software market to the detriment of European suppliers and users? Having secured around 80 % of the market in this sort of software, Microsoft enjoys an unrivalled domination in the sector. According to the magazine 'Personal Computer World' , the computer software giant sells copies of Microsoft Office to US suppliers for only $80 whilst charging UK and presumably other European competitors £140, almost twice the US rate for exactly the same package. High levels of demand for the Microsoft Office, which includes WORD wordprocessor and EXCEL spreadsheet, amongst consumers limits UK, and hence European, suppliers' competitive ability and diverts business to the US. What action does the Commission intend to take to end such a blatant example of predatory pricing which clearly breaches the spirit of GATT negotiations?

Van Miert
The Commission shares the honourable Member's concern about the behaviour of dominant firms and we are particularly concerned where abusive behaviour by a dominant firm may be impairing the ability of its European customers to compete. The extent to which Microsoft , which appears to be a dominant supplier, can charge different prices to different customers and other aspects of their licence contracts with computer manufacturers are currently being discussed with Microsoft 's management.

Watson
I am grateful for that information from the Commissioner that this is being discussed because this strikes me as a blatant example of predatory pricing which clearly breaches the spirit of the GATT negotiations. If the allegations contained in the magazine, Personal Computer World , are true - they are certainly reported very bravely in view of the possible loss of advertising - they suggest that this practice is more wide-spread than it should be. Indeed it is possible that this is not the only case of predatory pricing by this particular company. I do not believe that there is any way in which we can prevent what is a very good product being the standard for office software in Europe. All attempts to promote alternatives to it from Europe will probably be a waste of money because it is a very good product and very successful with consumers. But pressure, adverse publicity and perhaps financial penalties for predatory pricing are more likely to be successful. Any assurance that you can give the House that action could be taken if this is discovered to be true would be gratefully received.

Van Miert
As I said, we are discussing this with the management of Microsoft . Before coming to conclusions one must be very much aware of the fact that first of all, the pricing information we have is of a confidential nature. But on the other hand, we have already seen a range of licence fees. They are very different. It is not appropriate to jump to a conclusion now. I must be aware of very different situations which need to be looked into more closely.
On the other hand one should not forget, again before jumping to conclusions, that there are different fees for different services. Comparing only two amounts if not good enough. I want to stress that point. Therefore please accept that I cannot be more specific today. But I confirm that the Commission is discussing this with the necessary confidentiality and with determination to find out what is really happening.

President
Question No 48 by Pat Gallagher (H-0390/96)
Subject: Tendering procedures for mobile phone licences
With regard to the awarding of a second mobile phone licence in Ireland, can the Commission confirm the accuracy of the statement made by the Irish Minister for Transport, Energy and Communications in the Dáil Eireann on 22 November 1995 regarding the European Commission's involvement in the award of the second mobile phone licence, including the following comment by the Minister, ' A cap of £15 million was put on the licence fee in the context that Eircell would also pay £10 million. That led to the approval in advance of the selection process by the Commission' ?
What is the view of the Commission regarding the content of letters sent by the Irish Department of Transport and Energy and Communications, in June and on 5 July 1995 to the bidders for the second mobile phone licence process, to the effect that the EU and the Department of Transport, Energy and Communications had fixed a £15 million 'entrance fee' for the new operator?

Van Miert
To understand the involvement of the Commission in the Irish tender procedure, it is necessary to recall that the Commission opened a formal proceeding regarding the maintenance of the GSM monopoly in Ireland in May 1994. On 8 March 1995 Minister Lowry confirmed that all the preparatory work for the opening up of the GSM market to competition was completed. By letter of 27 April 1995 the Commission had to draw the attention of the minister to certain conditions of the call for tender which could appear to be discriminatory.
The main issue was the amount the applicants were invited to pay for the right to the licence under clause 19. It was explained that such an option resulting in a fee which is only imposed on the second operator can significantly distort competition and favour the extension of the current dominant position of the incumbent telecommunications organization. At the same time it was stressed by the Commission that it was not entirely clear from the competition documentation submitted by the Irish authorities whether Telecom Eireann which already offered its own GSM service would also have to pay the same amount as the new competitor.
The Commission letter also mentioned that such an initial payment would lead to higher tariffs to recoup the money paid thus rendering the mobile service less affordable and restricting consumer access to the market contrary to the objective behind Council Recommendation 87/378. Subsequent to this letter, the representatives of the Irish Government during a bilateral meeting held in Brussels suggested to cap the initial payment and to impose a similar payment on Telecom Eireann. The Commission considered that if such an approach were followed, together with additional measures such as the right to establish own infrastructure, there would be no grounds for further action under Article 90(1) in conjunction with Article 86 irrespective of the option fee imposed on the second operator.
The role of the Commission is not to choose a given approach but to ensure that the approach chosen is in conformity with the rules of the Treaty. During these bilateral talks, the bidding procedure was suspended until the official confirmation of the Commission on 14 July 1995. After that date the Commission was not involved in any of the subsequent stages of the selection process.
The Commission was not consulted on the letters of June and 5 July 1995 mentioned in the honourable Member's question.

Gallagher
I thank the Commissioner for his detailed reply. I would say to him that there is concern in Ireland over the allocation of the second mobile phone licence. This is a key element in our telecommunications strategy. There was confusion as to the role of the Commission and I am pleased that has been clarified by the Commissioner this afternoon in view of the correspondence from the Irish authorities indicating that the Commission was responsible for the delay in expediting the process.
I should like to ask the Commissioner if it is customary for the Commission to become involved in the capping of fees as was the impression given by the Irish authorities. This evening's reply is important in the light of the political and media speculation in Ireland over the last few months. Could he confirm if the Commission could be involved in any way in the delay in expediting the process?

van Miert
Well, first of all let me recall that it is our policy to try to convince the governments not to impose a fee for a new operator. But if a government does so - which was not only the case in Ireland, it was also the case in Belgium, Italy and Spain - then the Commission obviously asks the authorities to be even-handed and to impose the same fee on the incumbent operator, who is usually already on the market. But that is the second-best choice because, at the end of the day, the consumer has to pay the bill.
Again, if the government chooses another approach, then it should be an even-handed one. In the light of our remarks, the Irish Government was willing to cap the fee. That was an attempt to limit - to put it in this way - the bill to be paid by the consumer, because our first concern is to have competition and by having competition also to serve the consumer best and to have the most attractive tariff.

President
Question No 49 by Anne Van Lancker (H-0392/96)
Subject: Implementation of the guidelines on aid to employment
On 12 December 1995 the Official Journal published the guidelines on aid to employment . These guidelines provide for a number of derogations from the rules of competition and the rules relating to state aid to firms for the benefit of certain groups of workers and unemployed persons who are difficult to place. Can the Commission say to what extent Member States (and regions) have been availing themselves of these opportunities and announced or taken measures to support employment for specific categories of workers? Which Member States have done so? Do firms in the social economy sector (such as those described in the Commission's communication on local initiatives ) and sheltered workshops qualify? Is the Commission considering an initiative aimed at encouraging the various authorities to take advantage of these measures?

Van Miert
The Commission has tried to make its policy on this subject rather more transparent and to define the rules and practice as clearly as possible for the various national and other authorities which are likely to be providing state aid for employment. There are, of course, a number of practices and instruments in use. The guidelines to which the honourable Member has referred are designed to make it clear which general measures do not come under the rules on state aid or, if they do come under these rules, when the Commission has no objection to them, such as when aid is provided for certain categories of workers who are difficult to place: the long-term unemployed, unemployed young people and female workers.
The Commission has now gone a little further in its interpretation, and as you know there have recently been a few cases where it has applied this in practice. I am thinking here of what is being done in France to help cities with extremely poor areas, for which extra aid can be provided without us seeing this as contravening the rules on state aid, because the effects are purely local and thus cannot be regarded as distorting competition.
In the context of the guidelines, two governments have notified us of their intention to take certain measures - I think this was what the honourable Member wished to know - in Sweden, where the measures were ones which had already been taken earlier and we are now discussing with the authorities how they can be adapted to comply fully with the rules, and in Spain, where we considered that there was no reason to raise any objection at all.
I can also assure the honourable Member that there is never any problem with purely local initiatives, since they can never be regarded as distorting trans-frontier competition. There is no reason why they should not go ahead. What we cannot allow are measures specifically designed to distort competition with neighbouring countries in particular, or measures which are claimed to be aid to employment, but which are really also designed to give firms an advantage in a given sector. The Commission has no choice but to oppose these. For the rest, you know how seriously the Commission takes the problem of unemployment, you are familiar with the White Paper, you know about the initiatives which President Santer and the Commission have proposed. I do not think anyone could accuse the Commission of not being militant here, if I may use the word, but we also have to try to maintain a proper balance and ensure that such measures do not result in distortions of competition.

Van Lancker
My thanks to the Commissioner for his detailed reply. It clearly proves that social principles can still be observed even when competition rules are applied, and I am very pleased to see it. I think far too few people realize that this is possible. I would just like to ask the Commissioner whether I can conclude from this that social clauses may be included in public invitations to tender, provided that they do not give an advantage to a particular firm, but simply seek to create opportunities for a particular social group which faces difficulties on the labour market?

Van Miert
I do not wish to give a specific answer on this, because I feel that it is something that should be dealt with by the Commissioner responsible for the internal market. Clearly, we have no objection to governments providing aid for special categories of workers who have difficulties in accessing and staying on the labour market, or for bodies dealing with such workers, for example. But where the measures affect competition and have a cross-border impact, then we naturally have to impose certain limits.
We try to interpret the concept of permitted state aid for employment as broadly as possible, provided that the governments or authorities are not trying to use this to gain an unfair advantage over one another. One thing we do hope is that, as the White Paper recommends, we can gradually bring labour costs down - not what people actually earn, but the additional related costs, so that labour is less severely penalized than it is today.

President
Question No 50 by Jörn Svensson (H-0460/96)
Subject: Competition rules
A company called Danisco has a monopoly over the sugar market in Scandinavia. It has decided to close down a profitable sugar refinery on the Swedish island of Gotland and is putting obstacles in the way of someone who is interested in taking over the refinery. Current legislation does not prevent such tactics.
Does the Commission intend to take steps to tighten up the rules of competition so that such situations cannot arise?

Van Miert
Since the matter raised by the honourable Member has not been referred to the Commission under the EC competition rules and the Commission does not have all the relevant information at its disposal, it is not in a position to comment on the merits of the case as such.
In principle, the Commission would not, on the basis of the competition rules, oppose operations whereby a company, even in a dominant position on a national market, for reasons of restructuring aimed at rationalization of production, moves production from one production unit to another within this market. This is happening every day. Obviously, when a company in a dominant position is abusing its position, for instance, by behaving in such a way as to keep other competitors out of that market at any price or buying other companies to close them down to limit potential competition, there might be a problem. But in this specific case we have not been received any specific complaint or any information. Therefore, I cannot be more specific.

Svensson
Mr President, thank you Commissioner for your answer, even though it was by its nature rather vague. We shall perhaps return to this question and I will then try to produce more concrete information on the case as such.
What we are talking about is in the first instance to all intents and purposes a monopoly; no sugar is sold in Sweden that does not come from this particular company. I consider that this in itself is a situation which should call for steps to be taken. Secondly, this company is preventing the establishment of an alternative on the island of Gotland, which is important from the point of view of regional policy and where the sugar industry plays a major role.
A small follow-up question: what attitude would the Commission adopt towards stricter Swedish legislation to prevent monopolistic behaviour in the sugar industry of the kind we are seeing today?

Van Miert
Since Sweden has only recently become a Member of the European Union, some of the problems which might arise and monopoly situations which are there have to be tolerated for the time being. In this respect I would ask national competition authorities if necessary to perform their own function. But if it is a question of a dominant company or monopoly abusing its position then that must be established. You must have evidence to show that. If you say that the company in question is trying to prevent another competitor from buying that company and wants to close it down in order to avoid competition and if you have the evidence, you can send this to the Commission or the competitor could file a complaint. That is why we have competition rules and a competition authority which, as you know, is the Commission. As long as we do not have a complaint and as long as there is no evidence, the honourable Member will understand that the Commission has no reason to act.

President
Question No 51 by Mikko Rönnholm (H-0493/96)
Subject: Business concentrations in Finland
Finland is in a strange position at present as regards competition policy: banking and insurance activities and the retail trade have been concentrated in the 1990s into ever fewer hands. In 1991 the market share of the two largest banks taken together was 55 %, whereas in 1995 it was almost 80 %. The corresponding figures for the retail trade were some 60 % in 1985 and nearly 90 % in 1995. The emergence of business concentrations particularly since Finland's membership of the EU is causing surprise among Finns, because it results in rising costs and a falling level of services. Does the Commission regard the current competition situation in Finland as contrary to the Union's competition policy, and if so, what has the Commission done and what does it propose doing to remedy this situation and prevent the wrong picture being given in Finland of the effects of EU membership?

Van Miert
It is not surprising that when countries join a big single market such as the one we have there is also a movement of concentration, mergers and acquisition. This is part of the game and is happening every day everywhere in Europe. Obviously, and fortunately I would say, there are rules of the game. We have had the merger regulation since 1989. In the most important cases the Commission has the exclusive right to vet the mergers and the acquisitions. By the way, since 1988 we have had to vet more than 400 cases of big mergers and acquisitions. Everyone would agree that it has been a rather successful policy and in several cases we had to impose conditions on such mergers and acquisitions. In Finland there was the merger between Kymmene and Repola . We imposed some conditions on that. In some other cases the Commission went as far as giving a red light and did not allow a merger or acquisition to go ahead.
That is the rule of the game. The basic rule is that acquiring a dominant position by merger or by acquisition is not allowed. This is a real guarantee against too big mergers and certainly against the creation of dominant positions by means of mergers and acquisitions.
I should also tell you that we have another instrument, namely Article 86. No-one should point the finger at a company which acquires a dominant position by virtue of its own strength rather than by merger or acquisition. But if it is abusing that position, the Commission can act and possibly impose heavy fines and this occasionally has been done. We have rules and if there are cases which the Commission should know about or where competitors think they have a case, they should file complaints with the Commission. Not that I am asking for extra work. Last year there was an increase of one-third in the number of cases, more than 30 % of the number of cases in the competition field, and this was only partly because of enlargement.

Rönnholm
Mr President, as pointed out in my question, the situation looks serious to the Finns, since the business concentration in question has taken place since we joined the Union. I would therefore once more request the Commission to underline the importance of competition, and to make its opinion known on the present situation, where acquisitions in the retail trade clearly have been made at a price considerably higher than the market price. This, I believe, demonstrates that it is a question of preventing competition, and not of rationalization or any other radical restructuring.

van Miert
Let me just say one thing. First of all, as you probably already know, the Commission wants to reduce the thresholds for the implementation of the merger regulation, because we are only competent with regard to big mergers, that means beyond ECU 5 billion for the companies concerned, which is really a large amount of money. We would like to reduce that threshold to ECU 2 bn, which would already give more scope for the Commission to look into that kind of merger.
This might well apply in the case of Finland. There is the so-called Dutch clause - Article 22 of the merger regulation - which allows national authorities to take a case before the Commission even if the figure does not reach the threshold. So the government can send a case to us and the Commission will scrutinize it and if appropriate take a decision. So it is already possible for a national government to take that step. Although this clause is rarely used, it could well be used very soon in Finland, if I am well informed. I cannot be more specific but as far as I know the Finnish authorities are rather in favour of that kind of cooperation.

President
Question No 56 by Felipe Camisón Asensio (H-0422/96)
Subject: Tobacco farming in the EU
What prospects does the Commissioner for agriculture envisage for tobacco farming in the EU in general and in Spain in particular?

Fischler
Mr President, ladies and gentlemen, I can tell the honourable Member that, as provided for in the basic Council regulation on tobacco, the Commission will shortly be presenting a proposal on the future tobacco regime, to apply from the 1998 harvest onwards. The reform of the tobacco sector, carried out in 1992, will be reviewed at the same time. This review is not yet complete, and I therefore regret that at present, I am unable to make any detailed comments.
With regard to Spain, however, I would make the point that, as in other less-favoured regions of the European Union, tobacco growing represents practically the only source of income for many small farmers there.

Camisón Asensio
Your answer was not a very specific one, Commissioner. However, I am grateful for the information you have given us concerning tobacco farming in the European Union in general, and in Spain in particular. I had hoped that this question would provide an opportunity to set out some specific guidelines for the future for the many small tobacco farmers in southern Europe - Greece, Italy, Spain and Portugal - and, more specifically, in the north of the province of Cáceres, Extremadura, which is the area that I am familiar with on a daily basis.
You will be aware, Commissioner, that these farmers and their families are concerned for their future, since tobacco farming is an activity of great social importance which creates and supports a large number of jobs in the regions concerned. And I am sure that it is quite clear to the Commissioner that what must never occur is a drastic reduction in tobacco farming without prior provision for farming of an alternative, substitute crop with the same characteristics in terms of socio-economic benefits. This consideration must be taken into account, I believe, in the proposals for 1998, to which the Commissioner has just referred.

Fischler
Since the honourable Member is well acquainted with the procedure in the House, you will know that - once the Commission has completed its report - there will obviously be an opportunity for Parliament to discuss the issues you have raised. I am well aware how important tobacco growing is for many small farmers in the European Union. According to our estimates, some 400 000 jobs throughout the Union depend on it.

President
Question No 57 by Ulf Holm (H-0428/96)
Subject: Subsidies to tobacco growers
About ECU 1 billion is paid to tobacco growers in the Union every year, whilst the smoking of tobacco causes diseases and human suffering. The provision of medical care for smokers costs vast amounts of money every year in the Member States. EU and national health programmes are aimed at reducing smoking as a way of combating cancer and other diseases.
Does the Commission intend to cut aid to tobacco growers in future, in order to achieve consistency with its health-related objectives?
Does it intend to introduce measures to help tobacco growers switch over to growing other products which satisfy more basic human needs?

Fischler
Mr President, ladies and gentlemen, the question is now being put the other way round, as it were. The questioner asserts that aid for tobacco growing leads to an increase in smoking, thereby compounding the health risks. But if you look at the state of the international market in tobacco, you will note that all that would increase, if the European Union were to discontinue its aid for tobacco growing, is imports on the one hand and unemployment on the other. People would be unlikely to smoke either more or less. After all, we do not subsidize the cost of cigarettes or cigars or any other smoking materials; all we try to do is enable European tobacco growers to operate cultivation methods and structures which can keep pace with world market prices for tobacco.

Holm
Thank you for your answer, Mr Fischler. In view of the damage which tobacco causes and the health programmes run by both the Union and the individual Member States it is of the utmost importance that we should reduce smoking. There is naturally a conflict here and this is why I asked my second question about whether the Commission has any proposals on how to change production over from tobacco cultivation to the cultivation of some product which is more humane and more geared to good health.
This is the answer I was really after in that the question you answered earlier mentioned that a great many small farmers continue to cultivate tobacco. How does the Commission intend to deal with this problem and find a new crop for these small farmers to grow?

Fischler
I would repeat that even if we were to give these small farmers an opportunity to grow different crops, that is no reason to expect people in Europe to smoke less. The two things are completely separate, and must be kept apart.
In any event, I think it would be premature to hold a detailed discussion today. I can assure you that our report, soon to be presented, will also ask what would happen if aid for tobacco growing were discontinued, so that you too will be able to assess the likely results and consequences of such an option. Some Members of the House - including the last questioner - have drawn attention to the importance of retaining this aid and preserving jobs in tobacco growing. We shall be able to discuss this with one another.

Provan
Commissioner, I must say that I tend to take Mr Holm's line and I am glad that he has tabled the question, because it is the inconsistency of Community expenditure that worries many of us in this House. When I last looked at this issue, I discovered that 80 % of the value of the product is in fact Community subsidy to tobacco growers - 80 % - and that is not very helpful. The annual payment that some of the tobacco growers get is, in fact, more than the value of the land that tobacco is grown on. So, again, there is a huge inconsistency in what the Commission is trying to achieve.
I tend to agree with alternative production, but some of these growers are very small growers indeed. Therefore, Commissioner, I would like to suggest to you that what we should do to try and get consistency in Community expenditure is, in fact, to decouple the payment from the product.

Fischler
I have a good deal of sympathy for what you say, but you should realize that you have at the same time given evidence of the fact that tobacco cannot be grown profitably in the European Union without subsidies. So a decision has to be made: either not to provide aid, but that then means no tobacco growing; or to keep the door open for tobacco growing, and that can only be done by granting aid.
As to whether aid to tobacco growers is currently being provided in the best possible way, that is open to discussion, and will likewise be addressed in my report. I therefore do not wish to embark on a full discussion here and now.

Hardstaff
I wish to point out that subsidies for tobacco production not only go to the very poorest Members of the European Union but also to countries like France, Germany and Austria, which have among the highest income per head within the Union. Surely we should not be subsidizing very rich countries to produce what you have just said is a very unprofitable crop when there is absolutely no economic reason for doing so? We should do away with that completely and help, through structural funds, those countries where there is a real economic problem and help them to develop alternative crops.

Fischler
Mrs Hardstaff, with the best will in the world, I cannot go along with your assertion that there are simply poor countries with poor farmers, and then rich countries with rich farmers who are not deserving of support. Unfortunately, because of the structures which exist - even in the country with the best structures in the European Union, namely the United Kingdom - some farmers are experiencing real income problems. It cannot, I am afraid, be inferred from the fact there are many wealthy farmers in the UK that those who do have problems there deserve no support. We cannot discuss the matter on this basis.

President
Question No 58 by Gerard Collins (H-0427/96)
Subject: Emergency aid for Nyre Valley sheep farmers
Has the Commission been made aware of the freak snow storms in the Nyre Valley, Co. Waterford, Ireland last March which resulted in large scale losses of sheep and has the Commission been requested by the Irish Government to make emergency aid available to the Nyre Valley farmers?
Will the Commission now bring forward proposals to aid the many farmers who have had to endure large scale losses as a result of the abnormal weather conditions?

Fischler
Mr President, the Commission is aware of the difficulties referred to in the question, which were caused by this snow storm and the freak weather conditions in the Nyre Valley in Ireland. However, I can tell you that the Irish authorities have not sought assistance from the Commission. The reason is very simple: as you know, the Community is not responsible for disaster relief and protection, which is the responsibility of the Member States. Support measures or emergency aid in the case of adversities caused by the weather can therefore only be provided at national level.

President
As the author is not present Question No 59 lapses.
Question No 60 by Christine Crawley (H-0453/96)
Subject: Job losses in agricultural industries
What does the Commission estimate is the number of jobs lost and under threat in the European Union, in agriculture-related industries as a result of the BSE crisis and subsequent export bans? What mechanisms for monitoring the effect on jobs has the Commission put into place, and what support will the Commission be making available to those people and industries affected by the BSE crisis?

Fischler
The Commission has no precise statistics on how many jobs have been lost, or are at risk, in the processing industry, in slaughterhouses or in the cattle trade, as a result of the BSE crisis. We do not possess such information. It goes without saying, however, that the Commission is well aware of the problems and has begun to consider how they can best be minimized.
One of the most important short-term measures which we have taken in this context is of course intervention. If, with the aid of intervention, we can compensate to some extent for the current slackness of the market and hasten a return to more normal market conditions, then that is the best thing we can do for those employed in this sector.
Over and above that, to my mind, it is chiefly a matter of seeking to adopt longer-term confidence-building measures to boost the consumption of beef. Here the Commission is of course trying to help find solutions to overcome these serious difficulties and to restore consumer confidence.
Also of relevance in this context - and this has major implications in terms of employment - are the measures agreed for animals over 30 months old which have recently been put into effect in the United Kingdom. The same applies to the measures, still to be agreed, which are intended to accelerate the eradication of the BSE disease. I believe that all these measures, taken together, do provide some relief in these difficult circumstances.

Crawley
I thank the Commissioner for his answer. I find it disappointing given the scale of the crisis that we have with BSE that the Commission has not yet asked for figures or started to look at the monitoring of the situation as far as jobs are concerned beyond the measures that the Commissioner has spoken about such as intervention and confidence-building. It is the Commission's responsibility to produce an annual employment report in the European Union and therefore I would suggest that it is very important that the Commission actually starts some scheme of monitoring the jobs and the sectors that are under threat in this crisis. I know anecdotally, as an individual Member of the European Parliament, that there are thousands of jobs under threat across the European Union because of the BSE crisis, not only in my own constituency, but in many of the European Union countries outside the United Kingdom. So I believe that it is important for the Commission to take this very seriously. I would ask what steps the Commission intends to take to ask for figures from the Member States on the threat to jobs and jobs that have already disappeared because of the BSE crisis?

Fischler
Perhaps I might add that certain programmes are being implemented on a continuing basis: there are, for example, the Structural Fund resources, which can be used to assist Objective 5b or 5a areas, and which could be applied to support the restructuring of the rendering industry in the United Kingdom, for instance, or to promote investment. Other initiatives can also be taken under the Objective 3 and Objective 4 measures; these offer very specific support. With statistics alone, we cannot help anyone. However, if you think it important to have precise figures on the employment situation in this sector, I shall gladly pass the matter on to my colleague Mr Flynn, who is the Commissioner responsible. We could perhaps carry out a detailed survey, or else obtain information from the UK authorities.

Smith
Mrs Crawley's question was about people in associated industries, the people who lost their jobs as a result of the ban, who work in the road haulage industry, the slaughterhouses, the meat-processing industry. I asked the Scottish Office if there are any programmes we can use to help, for example Objective 5(a) or Objective 5(b). The Earl of Lindsay tells me that there are quite insurmountable obstacles in using EC structural funds. There are detailed legal obligations which cover these measures and it is not possible to set aside these provisions. But Objective 5(a) concerns grants for marketing and processing of agricultural products. If people are prevented from marketing or processing agricultural products, could we not use Objective 5(a) funds to assist them with this particular problem that we have at the moment?

Fischler
I think we actually need to look at the scale of what is involved here. If you think that intervention costs are lower, I would point out that across the EU, the total amount in intervention has reached 150 000 tonnes. The cost of intervention for 100 000 tonnes is ECU 240 million. This means that we have already spent ECU 360 m on these measures alone, to enable the animals to be slaughtered immediately, because ultimately this boosts employment in slaughterhouses. If they are then stored in refrigerated warehouses, people are employed there too, and so on. If you now consider that an additional 25 000 animals per week are currently being slaughtered, under the provisions on animals over 30 months old, you will get some idea of the effect this is having on employment.
I therefore believe that these large-scale measures are in fact the most important contribution in terms of employment. Moreover, I would draw your attention to the fact that the volume of turnover is significantly greater in the United Kingdom than in many other Member States. Although prices to farmers are low, the turnover of slaughterhouses is higher than in other Member States. The question of employment can certainly not be seen merely in the UK context.

McCarthy
I should like to come back to Objective 5(a) and particularly budget line 886. I understand that from the period from 1994 to 1999, ECU 226.487 million were available to the UK to use for marketing and processing. In fact I understand that the UK Government is only wanting ECU 51 million of that, therefore not taking up ECU 175.304 million. For me that is a massive dimension of funding which could very well be invested in the UK economy to help those people in the industry.
If you were to have a request from the UK Government to reinstate that ECU 175 million to use to solve the crisis and help the workers in the industry, would you be prepared to look at that favourably and would you be prepared to released those monies to the UK?

Fischler
The figures which you have given tally exactly with my own figures. It goes without saying that the Commission is prepared to take decisions on measures under any directive, but we do need a request from the government responsible.

President
As you will see from the footnote, the Commission has asked if we could take Question No 94 from Mrs Crepaz on basic foodstuffs - consumer protection.
Question No 94 by Irene Crepaz (H-0465/96/rev. 1)
Subject: Basic foodstuffs - consumer protection
Which final products are directly or indirectly affected by the lifting of the ban on gelatine, tallow and bull semen?
What measures have been taken to inform and protect consumers (certificates, labelling, information campaigns)?
What is the Commission's attitude to the statement made in the context of the BSE crisis that producers of basic foodstuffs should take responsibility for these?

Fischler
Mr President, ladies and gentlemen, in addition to bull semen, the final products covered by Decision 96/362 include products containing gelatine and tallow, which in the United Kingdom are manufactured strictly in accordance with the requirements of that decision. Under the decision, the raw material used to manufacture these products must originate from cattle under 30 months old that are not infected with BSE or suspected of infection.
In addition, only tissue from types of raw material in which the virus has never been detected may be used. The raw material must be processed under veterinary supervision and in accordance with the procedures laid down in the annex to the decision, whereby an independent laboratory must certify that any infectious residue which may have been present in the original materials has been rendered inactive. The products listed in the annex must be labelled, or otherwise marked, with details of the manufacturer and the manufacturing process, and must bear a certificate of fitness for consumption issued by a veterinary official.
The composition of the final products is visible to the consumer from the list of ingredients, which must appear on the label pursuant to Directive 79/112 on the labelling of foodstuffs. The Commission will consider the question of extending the rules on product liability to primary producers in the context of its current work on preparing a green paper on food legislation.

Crepaz
Thank you for your comprehensive reply, Commissioner. I just have a brief supplementary question. The health of consumers really should be our overriding concern, and with regard to final products we now know, for example, that gelatine is contained in cake glazes and in jelly-babies, which are so popular with children. Can you assure me, with a clear conscience, that these do not contain any pathogens, and that they represent absolutely no health risk to consumers? And with regard to bull semen, can you state with a clear conscience that no disease can be transmitted through it?

Fischler
In reply to your last question concerning bull semen, I can say the following: we based our decision on the view of the experts on the Scientific Veterinary Committee, according to whom there is no risk associated with bull semen. As far as gelatine and tallow are concerned, perhaps I might describe the present situation once again: firstly, we asked the scientists to define a procedure which ensures that any possible trace of the BSE virus is inactivated, in other words destroyed.
Secondly, we have stipulated that every manufacturer of gelatine and tallow in the United Kingdom must obtain a licence from the British Government. Thirdly, we have ensured that only certain specific products may be used to manufacture gelatine and tallow, namely those which I have already described. Only such tissue may be used.
Fourth, the British Government is obliged to inform the Commission as soon as it awards a licence to an industrial company. Fifth, the Commission carries out an inspection in the UK - and invites all the other Member States to join it - and only once all these matters have been resolved to our satisfaction will the Commission formally decide that a particular British company may once again place gelatine or tallow on the market. Even then, every consignment must be accompanied by a certificate from the veterinary official, stating that all the rules have been complied with during the production process, and indicating the frequency of inspections carried out in that company by the veterinary official. In effect, this means that we now have a blueprint for the future, and it is now up to the British Government - and of course the industry in Britain - to see how rapidly they can adapt their procedures so as to meet the requirements for safe production and enable these inspections to be carried out. No one can say at present when exports of gelatine will in fact be resumed.

President
Question No 61 by Roy Perry (H-0474/96)
Subject: BSE
The significant difference between the large number of cases of BSE in the United Kingdom and the declared cases of BSE in other Member States has been partly attributed to the United Kingdom's greater vigilance and understanding of this disease. BSE has only recently become a notifiable disease, and it is evident that this disease has not been as closely monitored in other Member States in comparison with the United Kingdom.
Does the Commission consider the statistical evidence of BSE to be both accurate and equivalent for all Member States, and has it set up a mechanism whereby cases of BSE can be accurately monitored and confirmed throughout the EU?

Fischler
Mr President, according to the latest information, the most likely cause of the BSE epidemic is the feeding of cattle with meat and bone meal derived from processed materials containing sheep carcasses affected by scrapie. The unusually high incidence of BSE in the United Kingdom, compared with the other Member States, can be attributed to various factors. A risk assessment of these factors has revealed that the circumstances which can cause such a high incidence of the disease, and also a high prevalence of scrapie - a change in the method of processing carcasses and a high proportion of meat and bone meal in feed - exist to this extent only in the UK.
BSE became a notifiable disease throughout the Community under Decision 90/130/EEC, in the context of Council Directive 89/894. Commission Decision 94/474/EC stipulates that where carcass inspections reveal clinical signs of BSE, such animals must be confiscated and their brains examined for BSE.
The Commission has arranged training courses for national experts on issues relating to the detection of BSE, so as to ensure that all the Member States are adequately equipped to diagnose it. The Scientific Veterinary Committee, having examined the question of disease monitoring by means of sample checks, concluded that such a procedure would be unlikely to contribute significantly to detection of the small amounts of the BSE virus which might exist in the Member States.

Perry
I thank the Commissioner for his reply but I have to say that farmers in my constituency say to me they have grave doubts about the validity of statistics in other countries of the European Union which are very low compared with the United Kingdom. Only this weekend there are reports from scientists in such places as the Dutch Institute of Science and Health and Tübingen University, which throw grave doubts on the figures coming from other European countries. Between 1985 and 1989 57, 000 cattle from the United Kingdom were exported to countries in the European Union. Had they remained in Britain those scientists would have expected something like 1, 600 cases of BSE to be declared. In reality only 30 cases have been declared and I repeat the question: does the Commission have any system at all for monitoring and validating the statistics that are coming from these other countries? Has he any comments on these reports now coming from European scientific foundations?

Fischler
Mr President, the Commission keeps the scientists informed continuously both of the detailed statistics and the most recent history of the disease, and frequent discussions also take place in meetings of the BSE subcommittee of the Scientific Veterinary Committee. The fact that, to date, 99 % of cases have occurred in the United Kingdom and only around one per cent in all the other countries of the world is not attributable to other countries being less meticulous as regards the obligation to notify the disease. This disease is notifiable in all countries, and we can therefore assume that the Member States are fulfilling their responsibilities in this respect.
It would also be very useful in future - although a good deal of research is still needed - if we could find out not just after an animal has been stricken with BSE that the sickness has occurred, but could also test for the disease, as it were. That is why I have asked the so-called Weissmann Group to propose some research projects, so that such tests might become a reality as soon as possible. That would considerably facilitate the handling of this disease.

President
That concludes Question Time. Questions not taken for lack of time will be answered in writing.
(The sitting was suspended at 7.27 p.m. and resumed at 9 p.m.)

Practice of the profession of lawyer (continuation)
President
The next item is the continuation of the debate on the report (A4-0146/96) by Mrs Fontaine, on behalf of the Committee on Legal Affairs and Citizens' Rights, on the proposal for a European Parliament and Council Directive (COM(94)0572 - C4-0125/95-94/0299(COD)) to facilitate practice of the profession of lawyer on a permanent basis in a Member State other than that in which the qualification was obtained.

Sierra González
Mr President, the draft directive which is the subject of this debate has two objectives: on the one hand, to give effect to the freedom of establishment of lawyers within the European Union by means of a specific directive; and, on the other, to facilitate the participation of legal experts in crossborder commercial operations in which, by virtue of the very nature of the internal market, international, Community and national legislation are increasingly overlapping.
There is no reason why these two objectives should conflict, but nor are they are necessarily complementary, as this draft directive makes clear. Indeed, certain safeguards built into the draft directive, and which can be seen as an attempt to ensure expert advice in cross-border operations, do themselves represent obstacles to the freedom of establishment, such as the restriction of the practice period and the retention of aptitude tests.
These restrictions, if applied, would give rise to different conditions for the practice of the profession in a host Member State for migrant lawyers and lawyers who are nationals of that Member State, and this would obviously be a violation of the right of establishment, which is based on the principle of equal conditions.
Certainly, it is not all negative. The draft directive has some positive aspects which I have no difficulty in recognizing, such as the satisfactory solution to the question of professional and ethical rules; the establishment of the possibility of group practice; and the completion, in spite of the restrictions I have referred to, of the Community legal framework for the freedom of establishment of lawyers. However, the amendments proposed by the rapporteur - which, as she herself said, are the product of a compromise - markedly improve the draft directive, especially those aimed at guaranteeing the right to maintain more than one place of work within the Community, strengthening consumer protection and safeguarding the independence of the legal profession and the right to practise independently.
Finally, I am obliged to say that we should have taken liberalization much further and deleted all references to temporal restrictions, including the requirement of three years' regular pursuit of an activity involving the law, which I regard as a lesser evil. In these restrictions, certain features of the type of corporatism which I reject survive, although a reasonable effort to achieve a compromise has been made. Naturally, on behalf of my group, I support that effort.

Saint-Pierre
Mr President, ladies and gentlemen, I should firstly like to congratulate Mrs Fontaine on her clear and effective treatment of this second version of the proposal for a 'lawyers' directive.
Indeed, whilst this draft directive complements its predecessor from 1977, which was restricted to liberalizing the provision of services, there was a substantial risk of seeing this project becoming bogged down in the quagmire of national preference. The various players involved - the Commission, the Consultative Committee of the Bars and Law Societies of the European Community and Parliament's Committee on Legal Affairs and Citizens' Rights - quickly realized that the success of this codification proposal depended on their joint agreement. The painful birth of the 'pharmacists' and 'dentists' directives, which took 16 and 17 years respectively to adopt, provided an example to avoid.
The Group of the European Radical Alliance welcomes the outcome of the vote in the Committee on Legal Affairs, which improves the proposal for a directive of 21 October 1994. We support the replacement of the aptitude test with a fair and equitable procedure for assessing the professional competence of migrant lawyers. We welcome the consensus achieved with a view to protecting lawyers' interests in the case of the establishment of multi-disciplinary practices. We support the provision allowing migrant lawyers to practise under the professional title of the host Member State after practising their profession effectively and regularly for at least three years.
On the other hand, perhaps - and I stress perhaps - the provision enabling migrant lawyers to practise under the home-country professional title for an unlimited period of time ought to be questioned. And perhaps the committee's recognition of a hybrid status of established free service provider should be questioned too.
While the ARE Group might wish to see a smoother process of integration from Community to national level, it can only endorse this report, which is the product of a consensus. It deals with the interests of the profession of lawyer and, above all, the interests of European citizens subject to the law.

Gollnisch
Mr President, ladies and gentlemen, the peculiarities of the British legal system, with the division of the legal profession into solicitors and barristers, and the peculiarities of the Romano-Germanic legal systems which apply in the majority of the other Member States, have too often resulted in a total lack of reciprocity in the freedom of lawyers to exercise their profession in another Member State.
Mrs Fontaine's report concerns the interests of the legal profession as a whole. It deals in particular with the question of the right of migrant lawyers to practise their profession permanently under their home-country professional title in another Member State.
The National Front and the Group of the European Right support the original position of the French bar, which was in favour of the automatic integration of migrant lawyers into the host-country bar and the adoption of the host-country professional title following a period of practice in that country. Like many lawyers in France and other Member States, we have reservations as regards the possibility of practising permanently under the home-country professional title, without any limit of time. And like the French bar, we are opposed to the absence of genuine controls and restrictions on the activities of migrant lawyers in host Member States.
We also wish to protect the interests of citizens subject to the law, and we are calling for genuine and de facto equal treatment of lawyers registered in France, for example, and migrant lawyers. In particular, fiscal and public service constraints must not be a burden on host-country lawyers alone.
The French bar expressed its opposition to the first draft of this report, which it considered to be prejudicial to the profession. Mrs Fontaine and her colleagues in the Legal Affairs Committee have finally drawn up a compromise text. We pay tribute to the rapporteur's considerable efforts, but we are not entirely satisfied with the resulting text, in which, against all the odds and with a great deal of perseverance, she has managed to combine a variety of points of view.
It is for this reason that we are reserving our position on the report and the draft directive.

Cot
Mr President, the draft directive on the practice of the profession of lawyer is the outcome of fruitful cooperation between the Commission, Parliament and the profession concerned, aimed at achieving a balanced text which effectively ensures the freedom of establishment, whilst retaining certain essential safeguards.
Following the adoption of the general directive on the mutual recognition of qualifications, the bars of Europe - with the exception of the Luxembourg bar, which bowed out from the start - took the view that there was a need for a specific directive to give full effect to the 1988 directive, and not to restrict its scope, as Mr Wijsenbeek seems to believe, if I understood him correctly.
The profession, as represented by the Consultative Committee of the Bars and Law Societies of the European Community, worked hard on this project for a number of years. The CCBE made sufficient progress to convince the Commission of the need to submit a proposal for a directive, but not to achieve the very broad consensus necessary for the adoption of the text. We undoubtedly owe it to the authority, patience and persistence of Mrs Fontaine that it was possible for the profession and the European Parliament to overcome the remaining obstacles and reach agreement on the text submitted to us.
I should like to make two comments concerning this text. Firstly, the debate has understandably centred on the remaining obstacles: aptitude tests, and the right to practise under the home-country professional title. However, this should not lead us to forget the other important provisions of the text. I am thinking in particular of those concerning joint practice, which should enable our bars to compete on an equal footing with large-scale United States and Japanese practices, which have never needed directives in order to cream off the legal market in Europe by playing on our divisions.
My second comment concerns the particular question of the right to practise under the home-country professional title, an issue on which, as was pointed out a few moments ago, the French bar is especially sensitive. I believe that the proposed text gives the necessary assurances. It clearly makes migrant lawyers practising under their home-country title subject to the regulations, codes of conduct and disciplines of the bars of host Member States.
Lastly, Amendment No 35, which provides a useful clarification of the integration mechanism that is being established, will meet the expectations expressed by a number of bars, including in particular the Paris bar. It now remains for the Council to put the finishing touches to the text, with the help of Mr Monti. Is it being overoptimistic to hope that it will do so quickly? The adoption of this directive has been dragging on for some ten years now - if not for the 17 or 18 years of other directives. In any event, it is undoubtedly desirable to consolidate the consensus which has been achieved on Mrs Fontaine's report without delay.

Palacio Vallelersundi
Mr President, the proposal for a directive which we are discussing today is undoubtedly one of those measures which, to paraphrase Robert Schuman, strengthen the building of Europe. And this measure, like so many others, bears the hallmark of men and women who have proved capable of overcoming national fears and prejudices in the interests of a European vision of Europe, as Carl J. Friedrich says in his book 'Europa: Das Entstehen einer Nation' .
Besides your own name, Commissioner - and I wish to echo the praise of previous speakers - that of the rapporteur, Nicole Fontaine, a French and European lawyer, whose good offices will for ever be associated with this directive, stands out on this list. And I should also like to place on record, in the report of Parliament's proceedings, the efforts of another lawyer, this time European and German - Hans Weil, who from his position as chairman of the CCBE, the legal profession's representative body in the European Union, illuminated the debate with his intellectual honesty and rigour.
Tomorrow's vote will therefore have the particular importance of setting out the future of Europe's legal profession. At the same time, however, it will be of general importance, since the issue under discussion goes beyond the strictly professional domain to encompass European society as a whole, and to encompass the citizens whom this Parliament represents - because indeed, we lawyers are the 'voices of the law' , to use the fortunate expression coined by Alfonso X, Spanish and European king, in his compilation of the laws of Castile.
The debate on this directive in committee brought to the surface the most obscure national fears and the most deep-seated mistrust between those of us who are called upon to pursue this common project of social, cultural and political integration, based on the rule of law.
In the face of such mean-spirited and short-sighted attitudes, the Committee on Legal Affairs, led by the rapporteur, has managed to achieve through the amendments a comprehensive solution which is both prudent and courageous - as Mr Rothley rightly pointed out - and which I am sure will receive the overwhelming support of the House tomorrow. For let no one doubt the fact: European integration must be based on the rule of law. Europe will be a Community of law, or it will be nothing - in other words, it will rapidly return to being what, strictly speaking, it has never ceased to be: a single market governed by the prevailing economic forces.
Europe will be a Community of law, or it will be nothing. And this project will only be consolidated if professionals in the legal arts, especially lawyers, become aware of their social function and prove capable of rising above the particularities of national legal systems, to build Europe on the acquis communautaire represented by the general principles of the law, as refined by our legal history and embodied in the Union's founding treaties.
For if lawyers are not capable of ensuring that the general takes precedence over the particular, of emphasizing that which unites over that which divides, can we realistically expect this attitude from those who are not specialists in the law, which is the art of integration par excellence ? Lawyers must prove capable of recognizing the fact that the principle which ultimately governs acceptance of a case is the ethical obligation not to participate in a lawsuit, not to give advice, without sufficient knowledge. And this rule requires a Spanish lawyer, for example, not to take part in a case involving the statutory provisions of a Catalan will, although his professional title formally permits him to do so, in exactly the same way as it requires him not to participate in a case involving German inheritance law. It should not be forgotten that what prevents him from taking part in these cases is the responsibility imposed by his professional code of conduct not to participate without sufficient technical knowledge.
I am coming to the end, Mr President. I referred to the social function of lawyers. The legal profession is faced with the exciting challenge of combining the inevitably commercial aspects of the practice of the law with its social function. Because its ultimate raison d'être , beyond any other consideration, is to defend our citizens, our fundamental rights and public freedoms, and the spiritual heritage which constitutes the foundations of European civilization.
Clearly, the creation of an area of freedom and security is everyone's joint task. But lawyers will play a particularly important role in this respect. As the voices of the law, they must speak out clearly and firmly in defence of the law and justice, and in defence of Europe, in order to ensure that the European Union provides a reference point and an incentive in a world of turmoil.

Pelttari
Mr President, following a virtually unanimous request put forward by lawyers, the Commission has presented a proposal for a directive, which we are now discussing.
The general directive from 1988 on the acknowledgement of qualifications with respect to this sector has proved poor and inadequate, since most Member States of the EU have chosen an alternative permitted by the directive involving the introduction of a compulsory aptitude test for professional practice, which in reality has hindered the free practice of the profession of lawyer.
It is regrettable that despite the experience gained from the regulations in force and from the practice of the European Court of Justice, the Commission has not presented an amended proposal to this general directive nor a proposal which would at least make the free movement of lawyers possible. I consider this free movement to include not only the free movement of practising lawyers, but also the actual freedom to offer one's services. The Commission has however chosen to give a special sectoral directive and to maintain the principle on a restrictive aptitude test.
Today the Committee on Legal Affairs is proposing 27 amendments, by which fundamental changes are made to the Commission's proposal. The purpose of these amendments is to increase the opportunities for a lawyer of one Member State to establish himself in another Member State. The committee proposes that it would be possible to practise the profession of lawyer in all Member States provided that the lawyer permanently uses the professional title from his own country.
The group that I represent is not certain whether the proposal put forward by the Committee on Legal Affairs in principle is consistent and logical. We have therefore presented amendments with the purpose of emphasizing that each lawyer has the right to move to a Member State other than where he has qualified for the profession and to practise the profession in accordance with the regulations of the host Member State. May I ask the Commission to give its view in detail on the amendments put forward by the Committee on Legal Affairs and the group that I represent. Finally I would like to congratulate Mrs Fontaine on an excellent report.

Schreiner
Mr President, I should like to begin by congratulating Mrs Fontaine on her excellent report, on which there are a number of comments I wish to make. With this report, we are at something of a crossroads. The legal professions, of which lawyers are one of several - business trustees, notaries and the like - are of course based on their national legal systems. In recent years, however, there has been a growing need within the European Union for these professions - to which I myself belong - to look beyond national borders. This has obviously made it necessary to get to grips with other legal systems.
I am not in favour of compartmentalizing this profession by erecting an artificial barrier to access, and the report says the same thing. On the other hand, the legal safety of the citizens in our countries is at stake. That means devising a system which will serve two purposes: on the one hand, free access to the profession must be guaranteed, in any country of the European Union; and, on the other, a lawyer must have sufficient knowledge of the legal system concerned to ensure that clients and companies receive the best possible advice.
I believe that the Commission's proposal - to lay down a clear definition of this professional title throughout Europe - is a very good one; the discussion about whether lawyers can operate in joint practice, or in companies with share capital or partnerships, is also very welcome, because I think that this question will be of particular relevance to the profession in the future.
The functions of lawyers should not, in my opinion, be seen in narrow terms, but they should also be regarded as business advisers. In the future, it will certainly be necessary to do this. If these directives and the debate on them open up such a prospect, then the report is a good starting-point for a very fruitful discussion.

Oddy
Mr President, I would like to thank Mrs Fontaine and colleagues on the Committee on Legal Affairs and Citizens' Rights for their considered and intelligent discussion of this topic. This is an important plank in the freedom to establish services and the completion of the single market. It gives room for recognition of the fact that lawyers can practice under home title in other countries. It is particularly important for lawyers in England and Wales as English law is an international commercial law. It is particularly important in the areas of shipping contracts, i.e. charter parties, commercial contracts, insurance, reinsurance, banking contracts and rescheduling of debts, which often specify English law as a law-governing contract even though neither of the parties is of English origin.
I would like to flag up one linguistic problem. Amendments Nos 25 and 35 should state 'public interest' and not 'public order' as has been translated.
In conclusion, this is the usual understated, erudite competence which we expect and usually find from Mrs Fontaine.

Anastassopoulos
Mr President, the report that we are scrutinizing today is a compromise. A compromise which embraces various approaches and attempts to indicate ways forward on the important issue of the practice of the profession of lawyer in a country other than that in which the qualification was obtained.
However, Mr President, I do not think that it matters very much that the result of so much time-consuming hard work, which has been overwhelmingly approved in the Committee on Legal Affairs and the plenary and accepted by the great majority of the administrative councils of the Bars and Law Societies of the European Community, is a compromise.
Of much greater importance, in my view, is the quality of the compromise, and in that regard Mrs Nicole Fontaine deserves all our congratulations. Because this compromise, as set out in her report, leads in the right direction. It gives real meaning to freedom of establishment. It constitutes an advance for the Union and for Europe.
We are getting rid of provisions which, essentially, have perpetuated protectionism and cast doubt on our reason - how else could the imposition of examinations on professionals who have practised their profession for years be explained. So I think that we should all accept that Mrs Fontaine's compromise is a good step forward. On such a subject it is only natural that many people should have had reservations and objections. We in Greece, too, have had a lot of difficulties. Just as an example, I can mention the problem of the establishment of law firms in Greece via a particular method and with elements that are not applicable in other European countries. Of course, we all had to surmount those problems rather than persist with reservations which would have worked against the solutions put forward today by Mrs Fontaine.
I followed at close hand the first stage of this substantial and lengthy endeavour of hers which has led to today's outcome, and I think that both she and the Committee on Legal Affairs, and, from tomorrow, the whole of Parliament, will be able to feel well-satisfied with the new prospect that has been opened up.

Vallvé
Mr President, firstly, I should like to congratulate the rapporteur, Mrs Fontaine, on this report on the proposal for a directive on the practice of the profession of lawyer. I believe that ensuring the freedom to practise the profession of lawyer throughout the European Union represents a further step towards achieving the political integration of the Union and guaranteeing the democratic rights of all its citizens.
We must interpret the rules concerning access to the professional title of a host Member State, whereby automatic entry to the bar is prevented and a period of practice in the host country is required, as a positive step which in the short term will enable the system to function and, in the long term, may be adapted to new circumstances. The current problems may well be simply the kind of temporary difficulties which are characteristic of an adaptation period - a period which will pave the way for the proper functioning of the system in the future.
Furthermore, I welcome Amendment No 7 to Article 1, which provides for the establishment of the professional title 'lawyer' in all the official languages of the Spanish state. It is a good thing that this recognition of all Spain's official languages should appear in a text concerning the profession of lawyer, since lawyers are traditionally the most important defenders of human rights and the collective rights of peoples.

Reding
Mr President, I should firstly like to congratulate Mrs Fontaine on her excellent report and thank her for the understanding that she has shown throughout her work for Luxembourg's special circumstances.
The Luxembourg bar currently has 620 lawyers, 27 % of whom are non-nationals. This is clearly proof that the free movement of lawyers is a reality in Luxembourg. Furthermore, national and non-national lawyers in Luxembourg coexist in a harmonious and collegiate way, and the user of legal services - the citizen - has confidence in lawyers registered with the Luxembourg bar, whatever their nationality, because he has the assurance - since all these lawyers have received specific training in Luxembourg law, which is different from French, Belgian, German or any other law - of being properly defended before the courts by lawyers who know both their job and Luxembourg law, as well as the specific jurisprudence of the country.
If this new directive is applied, what is in danger of happening? Firstly, the user of legal services will no longer know where he stands. Will the lawyer he chooses be familiar with Luxembourg law or not? There will be a risk of being poorly defended before the courts, and this will lead consumers to choose their lawyers according to nationality, something which at present does not happen in Luxembourg. Consequently, instead of promoting the free movement of lawyers, the new directive is in danger of hindering it.
Furthermore, there will also be discrimination between national and non-national lawyers who have taken the supplementary courses in Luxembourg law and their colleagues who are admitted to the profession without having undergone the same process.
In order to protect the users of Luxembourg's legal services, without jeopardizing the freedom of movement, and to defend the interests of lawyers of all nationalities registered with the Luxembourg bar, I have tabled two amendments. The first concerns the obligation to know the law of the host Member State, and the second concerns the requirement to be familiar with the languages legally recognized as judicial languages in the host Member State. I should like to thank in advance all those Members who are kind enough to support these amendments.

McIntosh
Mr President, I too extend my congratulations to the rapporteur, especially for the compromise text that she has produced, with which I find myself overwhelmingly in agreement. There was one very important point that I made at the committee stage which, I regret to say, has not been taken up by the services: that is to point out that Article 10(3) should be correctly translated into English as 'public interest' , not 'public order' . As colleagues are aware - particularly those who follow football and other sporting events where public disorder is very much the order of the day - it is important that the text should read correctly in all languages. I would like your assurance that tonight the services will take this on board and that Article 10(3) will now read 'public interest' , and not 'public order' .

President
This problem has already been dealt with by the relevant services.

Linzer
Mr President, ladies and gentlemen, I too should like to join the ranks of those congratulating the rapporteur, Mrs Fontaine, on her tremendous feat of having produced this excellent report. I also welcome the objective of this report - to improve freedom of movement for lawyers by means of this specific supplementary directive - especially as the general directive fails to clarify the question of the right to practise on a permanent basis under the so-called home title, and because the aptitude test laid down in Directive 89/48 has often been a real obstacle to the freedom of establishment of lawyers.
Personally, however, I wonder whether the approach of the Fontaine report to solving these problems will find favour with the professional groups concerned and, more generally, if it will meet the needs of people seeking legal advice. Guided by the Community-spirited principle of mutual trust between the Member States, Mrs Fontaine, you have drawn up a very far-reaching proposal. Through your exemplary work, you have managed to align the position of the European Parliament with that of lawyers in many areas.
The amendments to Articles 2 and 5 of the Commission proposal, on the practice of the profession and home titles, address comprehensively what is a pressing concern of lawyers. However, the crux of this directive is the provision in Article 10 which eases the existing requirement of an aptitude test. This certainly goes too far: to my mind, it is not enough to guarantee automatic, complete integration after three years of effective and unbroken activity in the law of the host country, without any formal criteria. I suggest taking up the proposal of the CCBE that an interview, rather than an examination as such, should be held. That would, I believe, be a thoroughly fair compromise, which would in particular suit the smaller Member States.

Monti
Let me, on behalf of the Commission, congratulate the rapporteur, Mrs Fontaine, for the commendable way in which she has succeeded in the difficult task of achieving a balanced agreement on an issue that is so controversial and so complex, showing genuine concern for the general interest of the European Union. I also applaud the work of the Committee on Legal Affairs and Citizens Rights' which has achieved a balanced position on the crux of the problem, succeeding in reducing to 27 the 94 amendments that were tabled. I am grateful also for the kind words addressed to the Commission.
The Commission is able to accept the main amendments and the bulk of the others: I am therefore able to accept Amendment No 10 which rejects the five year limit on practising under a lawyer's original title, as well as Amendment No 24 which provides for exemption from the aptitude test following three years' activity involving the law of the host Member State.
In the Commission's view, the difficulties arise in regard to four amendments only which, although of secondary importance in the general scheme of the proposal, raise issues of principle: these are that part of Amendment No 7 concerning the addition of Netherlands procureurs ; Amendment No 9 on the exclusion of lawyers holding a ministerial office; Amendment No 12 on the requirement of attestations of honourability; and Amendment No 21 on exemption from joining the social security scheme.
As far as the eight amendments that were adopted after the vote in the Committee on Legal Affairs and Citizens Rights are concerned, Amendments Nos 28, 34 and 35 are acceptable, whereas Amendments Nos 29 to 33 raise problems because they run counter to the report of the committee. To avoid any misunderstanding, I therefore welcome the opportunity to do as Mrs Fontaine has requested and provide some clarification concerning professional or ethical codes. Observance by lawyers practising under their home-country title of the professional and ethical code of the host Member State is a fundamental element in the proposal for a directive.
These rules include, among others, those relating to the interdisciplinary aspect, to incompatibility and incapacity that are designed to guarantee the independence of the profession of lawyer. Those rules must be applied in compliance with the provisions of the Treaty, the case-law of the Court of Justice in that field and this directive. Let me give you one or two examples of professional and ethical rules: the prohibition in some Member States on maintaining two practices in the territory of that State; certain restrictions on the exercise of the profession of lawyer in tandem with other professions; the ban on the exercise of some activities which could prejudice a lawyer's independence; and professional secrecy.
I shall conclude with two very brief points, Mr President: as the Commissioner with responsibility for the single market, I look upon the progress of this directive not only favourably but enthusiastically. To create a single market for lawyers, if I may put it thus, is important not only for the profession, in itself very significant, it is also - very - important for the whole of the single market, extending far beyond the profession itself. Lawyers, the bearers of the law, might be described as the life blood of Europe's legal structures; their freedom to establish themselves will strengthen the institutional and cultural foundations of the single market, making it genuinely an area of European legal civilization.

President
Thank you very much, Commissioner.
The debate is closed.
The vote will take place tomorrow, Wednesday, at 12 noon.

Satellite personal communications services
President
The next item is the report (A4-0179/96) by Mr Hoppenstedt, on behalf of the Committee on Economic and Monetary Affairs and Industrial Policy, on the proposal for a European Parliament and Council Decision (COM(95)0529 - C4-0517/95-95/0274(COD)) on an action at Union level in the field of satellite personal communications services in the European Union.

Hoppenstedt
Mr President, ladies and gentlemen, when Ronald Reagan launched his Strategic Defence Initiative - known as 'Star Wars' - in the early 1980s, the general reaction was to regard it as a piece of science fiction. The plan was for a network of satellites to monitor the entire planet in real time in order to detect enemy missiles and knock them off course, possibly using lasers. Although the project is more than likely to be mothballed indefinitely, it had a spin-off in terms of research - initially subsidized research - into satellite technologies. That is why America is now the leader in the field. The main practical uses of these satellites are in telecommunications and broadcasting, services that we use very intensively.
Most telecommunications or broadcasting satellites currently in use are geostationary, orbiting at a height of 36 000 km, and of course they need to have a 'footprint' on the earth's surface, which is a relatively cumbersome and unwieldy arrangement. For that reason, development work began on new technologies using satellites at lower orbits. Some of these are at a height of 10 355 km, but there are also some in the range 7001400 km, the so-called LEOs - low earth orbit satellites - which are the subject of our debate today.
I believe there has been a lack of awareness among Europeans in recent years as regards the development and use of these new technologies. The leaders in the field are American companies which are able to obtain licences in America but then seek to operate throughout the world. In Europe, we have failed to give European companies a stake in this area of development. We are merely passengers in these sectors, trying to hitch a ride without knowing exactly where we want to go or who is in the driving seat.
That is why it is vital for the industry in Europe to wake up and play a part in shaping satellite development, and in particular to have some structural involvement so that we can also then keep pace in terms of jobs.
No matter how many white papers on employment we produce, we shall never make up for any missed opportunities in this field. The Commission has responded in the right way by stating that it has a responsibility to spur the Member States of the European Union into action. We must keep reminding them that this particular area of satellite technology is one in which new markets will develop. The Commission has done a good job in this respect. Unfortunately, however, the Member States of the European Union were caught napping again at the ITU conference in Geneva last year, and allowed Bill Gates and his new company to reserve all the frequencies in individual countries throughout the world for data transmission through a system of 840 orbiting satellites. This means that terrestrial frequencies may face new competition in a form over which Europeans no longer have any influence.
A considerable number of launchers will also be needed to put 844 satellites into orbit. That will cost money and that is added value - and we may miss out on our share of it.
In this proposal, the Commission has asked to be involved in issuing licences and in international negotiations with third countries. The Member States - who are not our main concern in this debate, although as rapporteur I had to bear them in mind in order to achieve a practicable result - are naturally also involved, because they are responsible for allocating frequencies. Here in Parliament, therefore, we have proposed that in the event of a failure to agree on frequency allocation, or in international negotiations on the issue, the Commission should be given a mandate.
I hope that the Council will recognize the pragmatic nature of what we are asking for, and will not interpret it as weakness on the part of Parliament. I am sure that the Commission will assert its rights in negotiations with the Council, so that a sensible outcome can be achieved for European companies.
I am also sure that the Commission will continue to press for a mandate from European companies and the Member States, because only recently, at the WTO conference, the Americans tried to have the whole satellite system excluded from the agreement on telecommunications. What they were up to there is not clear. We must be vigilant in this area, and I am sure that the Commission too will continue to take a lively interest in it.

Malerba
Mr President, Commissioner, I wish to make a number of points that I put forward in the Committee on Energy, Research and Technology, that were mentioned in my opinion and follow on quite naturally from what has just been said by the rapporteur on the substance, Mr Hoppenstedt.
There is an important difference between satellite telephone services and multimedia services via satellite. In the case of the former, the reference is to mobile terminals whose main purpose is planet-roaming, the possibility then of travelling all around the world with just one telephone terminal. The technology is there, the international consortia have been set up - and European industries are also involved in them - and the pilot projects are ready to get under way. In contrast, the multimedia satellite service sector, Teledesic - that of Bill Gates, let us be clear about this - is still at the stage of technological development, particularly as regards onboard satellite processing in which interesting possibilities of technological competition between the United States and Europe remain. Furthermore, the content of the services and the actual operators have yet to be clearly identified. That being so, I have suggested that a clearer distinction be made in the Commission proposal for a decision between the approach to the former and the latter.
As regards satellite telephone services, given the very small number of potential operators and the relatively limited interest in Europe for that service as compared with the cellular service, GSM, there seems to be no justification for the Commission setting up a new selection procedure which would delay bringing the new services into operation. Moreover, the fact that there are several operators means that competition is secured.
I agree with the rapporteur, however, on the need to harmonize the procedures for the award of licences, but I do not think that the role of the Commission can extend beyond that segment.
I have spoken on other occasions in the House - and Commissioner Bangemann will remember this - in favour of a 'European Federal Communication Commission' . I am therefore in favour of the European Union having a regulatory function but I do not believe that this dossier justifies the Commission being given responsibility for selection.
Through Amendment No 11, however, I am suggesting that we increase research into, the promotion and regulation of multimedia satellite services, the other category in fact. It is in that sector that the future of the information society is being played out and it will be important that Europe is not caught unprepared.
To conclude: there has been substantial agreement with the views of the Committee on Economic and Monetary Affairs and Industrial Policy and the rapporteur, Mr Hoppenstedt, whom I congratulate on an excellent piece of work.

Caudron
Mr President, ladies and gentlemen, as Mr Hoppenstedt has explained with his customary skill and great clarity, we are examining this evening a proposal for a decision on an action at a Union level in the field of satellite personal communications services. In fact, a network of satellites covering the whole planet in real time already exists. It is the bastard offspring - so to speak - of President Reagan's 'Star Wars' project. This network makes possible the creation of satellite personal communications systems, which will offer the equivalent of cellular phones with a world coverage - although, of course, at a far higher cost - and will therefore be used in sparsely populated regions which are not served by cellular networks.
Substantial investment will be necessary to achieve this goal, and this opens up some interesting prospects for the European space industry. Furthermore, it should not be forgotten that this project also covers fields other than telephony, notably multimedia communication.
A project of this importance undoubtedly requires a coordinated approach at international, and especially European level. And it is in this context that the Commission is envisaging the adoption of a single Community procedure for selecting operators and granting licences to them. Whilst I understand the Commission's thinking, I have to say that, on the whole, I do not support its proposal for a decision, an attitude which is very much in line with that of the Committee on Economic and Monetary Affairs and Industrial Policy. Besides the problem of the Member States' sovereignty, which is largely ignored in the Commission proposal, there are other considerations which disturb us. Indeed, given the small number of potential global competitors, who are bound to reach agreement on the distribution of the available spectrum, we feel that it is pointless to impose the selection of operators.
Moreover, the proposal does not seem to take account of the requirements of the draft 'licences' directive regarding harmonization and the possibility of obtaining an authorization which is valid throughout the Community from a single regulatory body. Even if this directive does not concern individual licences, it could provide a framework for discussions which the Commission should try to complement. Like the rapporteur, I approve the Commission's concern to establish a harmonized Community approach to the issue as soon as possible.
Finally, we believe that prior to any international negotiations, Community cooperation should be promoted, with a view to establishing a single position which the Commission can then defend in international forums.

Giansily
Mr President, ladies and gentlemen, Mr Hoppenstedt's excellent report brings us up to date on the implementation of an information infrastructure project of which the least that can be said is that it is truly global. The strategic implications of the systems and services involved are considerable, and very important to the European market and European industry, especially in view of the global consequences of the transfers of technology from the military to the civilian sector, in particular in the United States.
At international level, the question of satellite personal communications systems and services recently took a new turn when, in the multilateral negotiations on telecommunications in the WTO, the United States decided to adopt a more intransigent attitude, threatening to exclude this sector from any future agreement. At present, therefore, there is no guarantee that satellite systems will be included in the final commitment that the United States will make at the end of the negotiations. Furthermore, the fact that a mechanism exists in the United States for granting space segment licences will give rise to discrimination against systems of non-US origin.
The Commission's initial draft has provoked strong opposition from a number of Member States. This is mainly for institutional reasons, since it provides for implementing procedures which are difficult to accept - especially as regards the powers attributed to the Commission - and give rise to serious doubts as to their conformity with the Treaty.
In view of the new situation created by the state of the negotiations in the WTO, it is essential to harmonize the negotiating positions within the Council as soon as possible, and to refer to the mechanisms provided for in the draft directive on licences when it comes to matters concerning the harmonization of authorization conditions and the content of terrestrial segment licences.
The amendments adopted by the Committee on Economic and Monetary Affairs and Industrial Policy and the Committee on Research, Technological Development and Energy, at the instigation of Mr Malerba in particular, make some important improvements in this respect, for example the removal of the questionable mechanism for the selection of space segment operators by the Commission. Another step in the right direction is the proposed integration of the rules on the terrestrial infrastructure for satellite personal communications services into the harmonized system of licences and authorizations.
In the view of the UPE Group, the proposed amendments in the international section also help to improve the draft decision, except for the possibility of giving the Commission a mandate to negotiate the allocation of frequencies within the ITU, in place of the Member States. There does not appear to be any good reason for such a delegation of authority, which would also seem to be incompatible with the current statutes of that organization.

Wolf
Mr President, ladies and gentlemen, I should like to congratulate Mr Hoppenstedt, but also take the opportunity of making the following comment of my own: when will the Commission finally submit a framework directive that will allow us to debate the basic outline conditions for liberalization of the telecommunications sector and the preconditions in terms of social policy? And when will the common framework for general authorizations and individual licences - which the Commission has already submitted - make its progress through the legislative procedure?
I should also like to raise some questions which, while they may be naive, concern what I regard as fundamental issues. Firstly, there are the conditions for harmonizing selection, as referred to in the reports and by previous speakers. I think it is clear that the Commission has consciously chosen not to make a sharp distinction between satellite-based personal communications on the one hand and broadband multimedia services on the other, in order to have an instrument that will allow it effective involvement in selection decisions in the latter area. That is by no means an unwise move, if one recalls the saga of satellite broadcasting and the key role that it played in the establishment of private television channels.
My second point is that a market is being talked about here, and at the same time we are being told that there are currently three providers operating across the world. I cannot help recalling the words of the great John Locke, the founder of modern liberal thinking, on the question of what constitutes a market: ' Being but two they could not agree' . Does this mean that if they had been three, it would have been possible to set up mutual relations based on the exchange of equivalents? If there is anyone here who believes that, I will buy them a drink!

Bangemann
I should like to begin by thanking the House, and in particular Mr Hoppenstedt, for the swift response to our proposal, since in spite of all the differences between your position and ours which came across clearly in the debate, there can be no disagreement on one point, namely that if we do not act quickly, no solution will be achievable - whether it is the one proposed by the House, that sought by the Commission or a compromise between the two - because what Mr Hoppenstedt said was true: our competitors, especially in the USA, are wide awake! They scored a partial success at the ITU conference. They are going to invite European companies to take part in the venture, indeed they are already making moves in that direction, but Mr Hoppenstedt was also right to say that the European firms are likely to end up as passengers. Their share will not be enough to give them a decisive role, and they will certainly not be able to determine the course of events.
There are many possible definitions of a market. Where there is only one operator, however, there is no market, but rather a monopoly. The problem with satellite communications, for whatever purpose they are used, is that in place of the public monopolies which existed in Member States in the past, there will now be a private monopoly. Parliament has repeatedly warned us that while deregulation might break up public monopolies, it could open the way for private ones.
I am genuinely at a loss to understand the tone of the debate. On the one hand, while we are to remain vigilant, there is thought to be relatively little chance of our competitors turning their lead into actual monopoly positions; on the other, our proposals are dismissed as an understandable but basically unacceptable attempt by the Commission to acquire new powers.
That is certainly not what we are doing, and the selection procedure, which has attracted various comments in the debate, must definitely not be the norm. It may even be that it is the exception, and we go so far as to assume that that will be the case. To that extent, we do not regard the arguments which have been put forward here in favour of the amendments as being conclusive.
Of course the House was right to make the point in the debate that satellite personal communications will come under the general 'licences' directive which is soon to be approved. However, that directive does not address issues of harmonization - which are certainly not covered by individual licences - and nor are there any plans for the coordination of decisions by the individual countries in good time, and that is the crucial factor.
I have always had the greatest respect for Mr Hoppenstedt's contribution in this area, even before I took over this portfolio on behalf of the Commission, but I must be absolutely frank about one thing, and Mr Hoppenstedt knows that it is a point of difference between us. What Parliament is proposing here with these amendments may well be the position which eventually emerges as a compromise from the Council. That is quite possible, and we can only hope that a compromise does emerge. But in terms of tactics and strategy, I think it is illadvised to open discussions with the Council from such a position, and that is why we are against allowing individual national licences which would merely be coordinated. Such a system will not be in place in time and it will not work, quite apart from the fact that in some cases, Mr Caudron, there are inherent anomalies, for example if every Member State has to issue individual satellite licences. Luxembourg is a country for which I have the very greatest respect, but I have to query the idea of one or more satellites intended for use in satellite personal communications in the European Union having to be authorized in Luxembourg. I can adapt to many things, but you must forgive me if I have some difficulties with that.
What I am saying is that we agree with the House on the need for action. However, I am not sure that the Council will move sufficiently on the basis of what Parliament is proposing here. Nor do I see why a distinction should be made between systems that use the frequencies assigned to mobile telephony services and broadband multimedia systems, which also operate on higher frequencies. In terms of regulatory policy, the two categories are quite comparable, and I do not think the difference in use is a justification for separating them. Let me end by saying that I have felt during this debate as if I was arguing with the Council. I will leave it to the House to decide whether or not that is a compliment.

President
Thank you very much, Mr Bangemann.
The debate is closed.
The vote will take place tomorrow at 12 noon.

Two or three-wheel motor vehicles
President
The next item is the recommendation for second reading (A4-0199/96) on behalf of the Committee on Economic and Monetary Affairs and Industrial Policy, on the common position adopted by the Council (C40149/96-00/0470(COD)) with a view to adopting a European Parliament and Council Directive on certain components or characteristics of two or three-wheel motor vehicles (rapporteur: Mr Barton).

Barton
Mr President, firstly I should like to congratulate all the individuals and organisations who have contributed to creating the compromise package before Parliament on the future of two- and threewheel vehicles. I give particular praise to individual bikers who have directly lobbied their Members in all Member States and in a very responsible manner argued for measures which will improve safety, reduce pollution and tackle the very real problems created by an irresponsible minority of bikers who ride bikes with very noisy exhaust systems.
The European Union as a whole needs to learn the lessons pioneered by the European Parliament; that good legislation is only made possible when you have constructive dialogue with the citizens who are directly affected. This exercise has been made possible in this case because of the work of national and international bikers' rights organisations coordinated by the Federation of European Motorcyclists, or FEM. I should pay a special tribute to their secretary-general, Simon Millward. This process stands as a classic example of how to connect the citizen to the workings of Europe.
The Council must now take this backing seriously, unlike when it responded at first reading. It is simply not acceptable for the Council to ignore practical proposals such as the one that would make it unlawful to trade in illegal, noisy exhaust systems. These are the systems that create the greatest nuisance and give biking in general a bad name. Nor can we allow manufacturers to brand specify replacement parts such as tyres. The customer must be allowed to choose from a range of suitable replacement parts as long as they meet the relevant technical and safety specifications.
By way of an example, a manufacturer such as BMW cannot require that only, say, Pirelli tyres could be fitted as a replacement when, for example, Dunlop or other manufacturers had made perfectly suitable and possibly, in some cases, superior alternative tyres.
Parliament's package requires that before we agree the next stage of controls on noise and emissions joint research should be done with riders' organisations and manufacturers to ensure that realistic and practical proposals are forthcoming. If the Council's position on anti-tampering was not amended, riders would be discouraged from the maintenance periodically needed to minimize pollution levels. After all, it would be ironic if such proposals were by default to jeopardize the future of two- and three-wheel vehicles. Motorbikes have a positive role to play in providing an economical as well as an enjoyable form of personalized transport, causing far less congestion and pollution than their four-wheel counterparts.
I urge Parliament to approve en bloc all the amendments tabled by the Committee on Economic and Monetary Affairs and Industrial Policy with the exception of Amendment No 3, which hopefully will be replaced by a new compromise amendment, Amendment No 20. Sadly it seems inevitable that the Council will not immediately embrace our amendments. Nevertheless there is one message that it must understand: if the European Union is to be connected with the everyday concerns of its citizens on biking or, for that matter, any other subject it can only do so in dialogue with the people directly affected. Parliament has conducted a meaningful dialogue on this item and we will not take kindly to that work being ignored by ministerial officials meeting in secret. A very important democratic principle is at stake.

Metten
Mr President, we could have a very interesting discussion on what Mr Barton has said about the people concerned by this directive. This is precisely what I wish to talk about. For those who view motorcycle noise from the other side, the non-bikers who mainly see only the negative aspects of biking, this has been a very difficult debate, because when one interest group makes itself heard as loudly as those representing the heavy bikers, it is difficult for Parliament not to side with them.
Given that the representatives of the non-bikers have not made themselves heard at all, I think that we in the House have actually done quite a reasonable job. Exhaust emission requirements are to be tightened up and the possibilities for tampering with engines drastically curtailed. However, when it comes to noise, major concessions have been made compared with, for example, a voluntary directive which has been in force in the Netherlands and Germany since 1978. What Parliament is now proposing is much less strict on noise levels and the measuring methods used. Personally, I think this sends out entirely the wrong signal both to users and the industry. All motorcycles sold in the Netherlands and Germany already meet strict standards, measured using even stricter methods. The main argument put forward by the biking lobby, that these stricter standards will mean the end of air-cooled engines, is manifestly wrong if you look at which models are sold in the Netherlands and Germany. The real argument is probably that less noise will mean less engine capacity, which leads me to suspect that the lobby we have been talking to mainly involved 'superbikers' . But the Council also has no room to talk. The real problem is with souped-up engines and illegal exhaust systems, but up to now it has rejected every compromise proposed by those who take the noise problem seriously. This fortunately includes the rapporteur and many bikers themselves, who have called for steps to be taken to enforce greater compliance with existing noise limits.
I sincerely hope that the negotiations that we will certainly have to hold with the Council and the Commission will produce satisfactory solutions to the problems of noise and the use of illegal exhaust systems.

Larive
Mr President, I think we need to go for the conciliation procedure. The Council has refused to incorporate our amendments from the first reading in the common position, so I think Parliament now needs to show that it means business. We must be sure that we get the 314 votes we need tomorrow, but they must be votes based on the facts of the issue, not used as a negotiating tactic, which is the approach the Council seems to be taking. And I would bet a good European motorbike that we win, Commissioner, then we can both ride on it.
The Council is playing a strange kind of game. On the one hand we have the 80 decibel limit, but since the first reading the Council has come up with the idea of using the highest result of the four measurements instead of the average, which actually brings it down to 78 decibels in practice. Terribly environmentally-friendly, do you not think? In fact, it is not. As Mr Metten has already said, the Council is refusing to deal with the problem of illegal exhaust systems, so all this is just window-dressing really. Not even the rules as they stand at the moment are being obeyed, and the police, for example in Amsterdam, are sitting with their hands in their pockets. So simply tightening up the rules will not achieve anything. I would ask Mr Bangemann whether the proposed measuring system has been influenced in any way by pressure from the Germans, whose technical skills could give BMW a major competitive advantage. We need to have standards that are realistic and likely to gain public support. So we should go for 82 decibels and a total ban on the production and sale of illegal exhaust systems, because they are the root of the problem, not the decibel level.
Anti-tampering is only useful in this context to prevent category-hopping. What the Council means is upgrading a moped to a small motorbike, and a small motorbike to a large one. But it has missed the point here, because all marking and plating does, even for larger bikes, is to create more red tape. The idea of using shear-bolts too will mean an enormous increase in costs for European bikers, who already find it expensive enough to maintain their machines.
Finally, let us make an appeal to the bikers themselves. 82 decibels and an average measurement result are fine, but be strict with yourselves and with others. Do not allow those who spoil things for everyone and flout the rules to get away with it. Help the police to take effective action against offenders. Cooperate with the police. Then there will be no need to change the rules in 2001, as Amendment No 20 calls for. I am looking up at the public gallery when I say: the ball is in your court.

van Dijk
Mr President, in my opinion the Council has given way to Parliament on a number of issues. Parliament seems intent on pandering to the bikers, so that as far as the House is concerned they can go on making as much noise and creating as much pollution as they like. A very sad state of affairs, in my opinion.
As Mr Metten said, on the one hand we have the bikers, who seem to revel in noise, fumes and dirt, and on the other we have the powerlessness of those who, as far as Parliament is concerned, simply have to accept that these young people have the right to come and disturb them. I would invite the rapporteur, the Commissioner and all the Council ministers to visit our river dykes and listen to the noise of the hundreds of motorbikes that come to shatter the peace of the local inhabitants from Ascension Day onwards and throughout the summer. I cannot understand why we have to protect the bikers' interests, and not the interests of these poor people. Why should they have to stay inside with their doors and windows shut? I find it both incomprehensible and disgraceful.
The possibilities for technical progress which Parliament usually regards as so important when it comes to environmental issues are being completely ignored here. The rapporteur is under pressure from the bikers' lobby to which he himself belongs and which is still not content. Mr Barton has tried to sink any attempt to tighten up the regulations. The vast majority of my group remain totally opposed to giving any ground on harmful emissions or noise at second reading. I really cannot understand what is happening here, and I can only hope that the Council will stick to its guns in the next round.

Barton
Mr President, on a point of order, it was mentioned that I was part of the bikers' lobby. As an elected Member for all citizens in my constituency I take great exception to being considered part of the bikers' lobby. I will work with the bikers' lobby and I will work with all responsible lobbies but I really resent being called part of the bikers' lobby. That is not true.

Blokland
Mr President, the European Parliament can be quite content. The Council has incorporated almost all its amendments from the first reading in the common position, except on the permitted noise levels, where it would not accept Parliament's rather curious wishes. And rightly so, in my opinion, because the noise limits originally proposed by the Commission were included in the second phase of the directive as long ago as 1987.
The House would lose all credibility if it decided to relax the noise limits now. Amendment No 11 would be a slap in the face for the innovative motorbike manufacturers who have voluntarily kept to the existing limits, only to be told in 1995 that they must now meet stricter requirements. This sort of ungentlemanly conduct is not acceptable.
The bikers' lobby argues that it is not the requirements that need to be tightened up, but how they are monitored. They see maintenance as the problem and feel that emphasis should be laid on preventing mopeds and motorbikes from being tuned up, by banning the sale of tuning kits.
In fact, we must cover both. Bikers who make too much noise not only spoil things for others who are out enjoying themselves, they also spoil things for other bikers who behave in a more socially responsible and environmentally-friendly way. The anti-tampering measures are absolutely essential, as are the stricter noise limits. But we should not be thinking of simply keeping the 1987 noise levels in force until 2006, as Amendment No 3 proposes. Anyone who believes that this will put us in the best possible starting position for the conciliation procedure is entirely mistaken. In negotiations, it is extremely important that your opponent takes you seriously, which is hardly likely to be the case here.

Blak
Mr President, I should first of all like to commend all the many people, not least in Denmark, who have campaigned actively for this proposal. There has been effective lobbying by the motorcycling population, not only members of the well-known groups, but also ordinary office workers who ride their bikes on Sunday. They have helped to persuade the European Parliament that the positive aspects of motorcyclists' outdoor life should be supported. Clearly, there can be situations where motorcycle noise may be a nuisance, but the point at issue here is not whether people are sensitive to noise, and I disagree strongly with the Greens, but they are still too much under the influence of cyclists. The point here is that the Commission has once again had its technical experts produce some fairly absurd regulations, without any regard for common sense or the realities of the outside world. The standards for noise should match the actual situation. And there are in fact not many people who can tell whether the noise level is higher than 82 decibels. The Commission should concentrate instead on ensuring that the motorcycles produced in Europe do not suffer from unfair competition. After all, unemployment is one of the worst problems in Europe today, so it cannot be of any help if we make it impossible to keep jobs in Europe by imposing unreasonable requirements on our own workplaces in the Union.
I very much welcome the substantial amount of work which Mr Barton has done on this issue, and there have been a number of creative attempts to bring the points involved home to the Commission. Indeed, even Mr Bangemann has been for a motorcycle ride with Mr Barton to find out that Parliament's proposals were on the right lines. Motorcyclists are people who like the outdoor life and the quality of life, and for goodness' sake let us stop spoiling this with stupid limits which cannot be measured. So I would say finally to the Greens once again: this may have been a brave attempt to do something for cyclists, but I am an active cyclist myself, and I think you should stop producing such ideas, because it will end up with people selling their bicycle and buying a motorcycle instead.

Bangemann
Mr President, this is a strange evening. In the previous debate, I heard the kind of arguments which I normally encounter only in the Council, and now I am listening to myself. What I said two years ago has been said by almost every speaker except Mr Blak - and another thing, Mr Blak, I have not yet taken a motorcycle ride with Mr Barton, but I have done so with Mrs Larive and that was, if anything, more enjoyable than with Mr Barton. However, I am also prepared to go for a ride with Mr Barton, I have no difficulty with that.
Of course I understand - and I say this to Mr Barton - that when an elected representative has a special relationship with a particular section of the population or of his electorate, he can sometimes become a mouthpiece for ideas of this kind, and that is quite legitimate, it is part of his function. However, I cannot accept the way in which Mr Barton has sought to exceed that process today, implying that he represented the people, whilst Commissioner Bangemann represented who-knows-what. In any event, it is not industry that I represent in this case. I have in fact tended to assume the role of my colleague Mrs Bjerregaard. It has always been my position that motorcycles should be subject to the same standards which Parliament applies to cars, light commercial vehicles and heavy goods vehicles. It is not often that I agree with Mr Metten, but I was really impressed by his speech this evening. It could have come from my own lips, and I can only congratulate him on it.
Incidentally, I found it amusing that England beat Holland 4-1 this evening, but four Dutchmen spoke after Mr Barton, so that redressed the balance.
What course of action is open to us as things stand now? I would say that since the Council has adopted a good many of Parliament's amendments, we should finally bring this process to a close. The file has now run to 657 pages! I would therefore ask you to appreciate that I cannot accept those amendments which seek to improve on elements already agreed by the Council. Parliament will be doing itself a favour if it decides to accept in essence what the Council has already accepted. That is substantially more than the motorcycle lobby could have expected at the outset. There is nothing wrong with lobbying, and of course people have to defend their interests, but motorcyclists are by no means the only people involved here. There are also those who suffer from the activities of motorcyclists. Mrs van Dijk reminded us of that. I would add that you have no need to invite me to measure noise levels - invite Mr Barton and other Members of the House! I would not wish to imply that your invitation is in any way threatening - please feel free to invite me, but not so that I can listen to motorcycle noise. There is no need for that. From the start, I have said that we should treat this issue just as you would any other.
I am, however, prepared to accept the position previously established by Parliament, and to that extent I too am part of this democratic process and I can accept that, even if it is hard for me to swallow at times. I would therefore propose that we should accept nine of the 20 remaining amendments, namely Nos 6 and 7 and Nos 13 to 19. The latter are all concerned with the procedure for measuring noise levels, and their purpose is to reinstate the text originally proposed by the Commission. The common position made the procedure more rigorous, effectively introducing more stringent limit values. I would point out that the measures to counter noise pollution are already tightened up considerably in the Commission's original proposal, because we are making the optional limit values binding.
With our proposal, we are therefore roughly midway between what the Council is seeking - which is even tougher - and the significantly less stringent proposals from Parliament. We cannot accept the remaining 11 amendments, for the following reasons: Nos 1, 4 and 5 are at odds with the prohibition on introducing to the market equipment that does not comply with the provisions of the directive. We have already stated that quite clearly in Article 15 of the framework directive. We cannot accept Amendment No 2 because trailers are definitely not covered by these provisions. Amendment No 3 seeks to postpone the date on which the limit values come into force. If we wish to postpone the whole thing until the year 2006, then we can let this go too. Why not, Mrs van Dijk, seek a postponement until 2026? I wonder how that would be received?
The amendment tabled yesterday on the same subject is likewise unacceptable and would create substantial delay. Amendments Nos 8 to 11 are intended to delete various provisions relating to anti-tampering measures. We need to consider for a moment what is meant by anti-tampering measures - we are not concerned with DIY enthusiasts, Mr Barton, or young men who buy themselves a motorbike and then make alterations to it in an attempt to give it more power, all of which is perfectly understandable. But with these amendments you would seek to permit, for example, any illegal modifications to motorcycles above a certain cubic capacity, in other words to big bikes. Do I see you shaking your head? This is something which we really cannot accept, therefore, and for that reason we have to reject, in this context, these measures whose only purpose is to allow performance-enhancing modifications with a minimum of risk. I would note in passing that these amendments refer to the Commission's original text which was not queried by the Council in its common position, nor by the House at first reading; in other words, from a purely formal point of view, the amendments are in a state of limbo, as it were, because they refer to something that has neither been proposed by the Commission nor adopted by the Council in its common position.
We are unable to accept Amendment No 12 on sound level limits. Measures which have already been considerably diluted, because their application is to be optional, are being watered down further still, and I would say to Mrs Larive who wondered at the Council's attitude: I wonder not at the Council on this issue, but at Parliament. In every other area, you find fault with us. Today we approved a programme on motor oils and its impact on emission levels for cars, a joint proposal by my colleagues Mrs Bjerregaard and Mr Papoutsis and myself, and I have no doubt that Mr Barton will tear it to shreds. He will ask how we came to set such low limit values. Wait and see.
Section 7, paragraph 4, contains the following note: ' L'inclusion du point 4 ' . It is in French, Mr Barton, if you would please bear with me. France had a victory tonight too, so...
The inclusion of paragraph 4, ' Provisions concerning the branding of components' , in paragraph 3 implies that the provisions concerning branding will only apply to mopeds and light motorcycles. In that case, mediumweight and heavy motorcycles would be completely excluded from the scope of the anti-tampering measures.
(DE) Imagine such a situation, if you would! Caught between motorcyclists on the one hand and a group of decent people on the other, Parliament has to find a way of remaining consistent. You must stick to the line that you have taken - and things have come to a pretty pass when you need an Industry Commissioner to tell you that.

President
The debate is closed.
The vote will take place tomorrow at 12 noon.

Leghold traps and pelts
President
The next item is the report (A4-0151/96) by Mr Pimenta, on behalf of the Committee on the Environment, Public Health and Consumer Protection, on the proposal for a Council Regulation (COM(95)0737 - C4-0105/96-95/0357(SYN)) amending Council Regulation (EEC) No 3254/91 prohibiting the use of leghold traps in the Community and the introduction into the Community of pelts and manufactured goods of certain wild animal species originating in countries which catch them by means of leghold traps or trapping methods which do not meet international humane trapping standards.

Pimenta
Mr President, ladies and gentlemen, the subject of our debate is this object which I am holding up: a leghold trap. Is there anyone here who would like to place their leg or hand in it? - then you will find out what this method of catching animals is really like: a cruel and inhumane death. This is what we are discussing here today, Mr President. We are also discussing a gross violation of Community law by the Commission and the GATT and the issue of the native peoples of Canada and the United States.
Let us begin with the gross violation of Community law. We had a regulation which is still in force, dating back to 1991. This regulation should have entered into force in 1995 but was delayed by one year in accordance with the terms of the regulation itself and following a request by the social and economic cohesion to improve its implementation. But the truth is that it should have entered into force on 1 January 1996. It so happens that by means of a press release and a letter signed by to Commission officials, it was decided that the 1991 regulation would not enter into force.
Mr President, I am no lawyer by I have been taught that in order to revoke a law or amend it a legislative act of equal judicial dignity is needed. In other words in order to annul a regulation or amend it, it would have been necessary for the Commission at some time in 1995 and according to legal procedures to present a proposal. This was not done. If it wanted to amend the regulation it failed to take action. On 1 January 1996 it was already too late. The European Parliament, through a vote in the Committee on Legal Affairs and a letter from President Hänsch, initiated the process to take the Commission to court for failing to comply with Community law, for the failure to apply the 1991 regulation. It is very important for the dignity of this house to make a response in order to safeguard the democratic legitimacy of applying legislation.
Secondly, we are discussing the GATT. The European Parliament has been duped and I was one of those who fell into the trap. The Vice-President of the Commission, Sir Leon Brittan, addressing the European Parliament in plenary session in Brussels, in order to obtain the ratification of the GATT over whose ratification - or nonratification - the European Parliament had sovereign powers, told us that there was no European environmental or social legislation that might be called into question by ratification of the GATT. Six months later Commissioner Brittan's own department told us that we would have to ditch the 1991 regulation because of the GATT. Does Vice-President Brittan speak with a forked tongue? What faith and confidence can we have in him? He obtained the European Parliament's vote by withholding the truth and did not even have the courage to come before this Chamber - once again it is the environment Commissioner who is here - to face the Members of the European Parliament and tell them that he lied.
The third question is that of indigenous peoples. There has been a lot of demagoguery about this, because it is a serious problem and must be dealt with seriously. These are the figures - official figures from the Canadian census. Only 1045 natives are full-time professional hunters. According to the Hunters' Association, they earn only 1 dollar for 5 dollar's worth of pelt. The money makers here are the fur traders and not the indigenous hinters, Mr President. We have the figures here. These thousand or so full-time professional hunters earn no more than 7000 dollars a year, something that could easily be compensated by regional development aid and other subsidies. We spend more in the European Union on farmers in difficult or mountainous areas. Recognising the seriousness of certain situations I have incorporated into my report amendments tabled by colleagues, which I accept, and propose the following. They should be entitled to take part in the negotiations which began a year ago, with consultative status. We should give these people the greatest possible right - even if Canada does not want to reach an agreement with us, the European Union should give them the opportunity directly to seek an agreement with us, through the Ottawa authorities. We should open up negotiations with them.
I return to the subject of cruelty. It is inhumane and cruel, it is impossible to allow animals to die in this way, allowing them to agonize for days on end - this cannot go on, regardless of any other considerations. There are more humane, less cruel ways of hunting and killing. At the end of the 20th century we cannot, as a civilised nation or people, allow this kind of thing to carry on.

Pollack
Mr President, the reason we have this report from Mr Pimenta today is that the Commission has back-tracked on legislation properly carried by the European Parliament and approved by the Council of Ministers. There really is a serious problem of lack of democracy here, which we have to continue to pursue.
When the regulation of 1991 was approved it was agreed that imports of fur into the European Union from countries which had not banned this barbaric and cruel leghold trap would cease in 1995. We had the debate about the substantive issue back in 1990, withstanding ferocious lobbying in the process, and we won the argument. It is a little unfair that we have Commissioner Bjerregaard here tonight to take the flak rather than Sir Leon Brittan. But of course this is the price of so-called collective culpability, unfortunately. So I am sorry for Commissioner Bjerregaard. But the collective Commission decided to operate a let-out clause and to wait for a fairy tale, which was the hope that an international committee in Geneva would come up with a humane leghold trap, thereby letting off the hook the major fur trapping countries. So it extended the deadline for a year until 1996. There is and there will be no such humane trap. So the impossible dream did not materialize and towards the end of last year the Commission started to get nervous in the face of threats from Canada to take the European Union to the WTO under GATT.
There is an available solution for the fur-trapping nations and that is to ban this leghold trap and to use some of the different kinds of methods which are available. But let us face it; the Canadian Government is making huge amounts of money from an industry designed for rich people to wear fur coats. It is on quicksand as far as its arguments are concerned on this issue.
Anyone with a grain of backbone would have been able to face up to this threat. It is perfectly clear that we have plenty of GATT clauses for legal people to argue under: Article 20 is one that comes to mind. But the Commission decided in its infinite and arrogant wisdom that a possible and dodgy threat from a foreign government with a big vested interest in making a lot of money out of its exploited indigenous people was more important than democracy, more important than the European Union's own law, duly enacted, more important than the interests of 350 million citizens and consumers and more important than animal welfare.
One could go on for hours about this sorry saga. There are facts and figures that could be argued well into the night, but the essence is that the Socialist Group and the Committee on the Environment, Public Health and Consumer Protection and this Parliament are outraged that the Commission sees fit to flout the democratic process of the European Union in this way. We will not stand for it. There is no case for the pathetic and weakkneed new proposal from the Commission, belated though it is, and it knows it. We fully support the excellent report by Mr Pimenta which we know is based on very carefully researched facts. There is only one way forward for democracy, for animal welfare and for a citizens' Europe and that is to implement the original regulation and to ban imports of fur from countries which are continuing to use the leghold trap.

Schnellhardt
Mr President, ladies and gentlemen, the issue of the so-called leghold trap regulation is a never-ending saga: this is episode five, if we are counting in years. Why is that? Could it be that we took the wrong approach in trying to exert indirect influence, through legislation, on activities which quite justifiably meet with our disapproval? Events would seem to support that conclusion. Since 1991, it has been the position that the regulation was to enter into force on 1 January 1996. That should have allowed sufficient time to work out the implementing provisions. Although I was not a Member of the House in 1991, I would point out that the aim was to see more humane trapping standards applied. In particular, the use of leghold traps was no longer to be permitted, and rightly so. But the regulation has failed to meet its objective in this respect. Of course, there are various reasons why it has failed and I shall go on to analyse those reasons briefly, one of which I have mentioned already.
A dilemma then arose. By the end of the year, no implementing provisions had been drawn up, so they could not be applied. At this stage, the Commission submitted a fresh proposal. It is my view that this proposal cannot possibly be approved, for a number of reasons. For a start, both the timeframe and the objectives are very vague. On the basis of such a regulation or proposal, negotiations could go on forever and I think that cannot be in our interest.
What is presented in this regulation is an over-simplification. Mr Pimenta, who courageously and quite rightly chose a different approach, therefore has my best wishes. This is an approach that we can support, although I make no secret of the fact that we have different views and expectations on certain points.
Let us consider the situation of the native peoples, especially in Canada. Mr Pimenta does indeed mention the figure of 1045 people, the fact that wages are low, and so on. But there is another point that we must bear in mind: in the areas where these people work and hunt, there are no species which are threatened with extinction. There are no problems with conservation and the environment. The people are adamant that their areas should be preserved and protected from so-called 'industrial progress' .
Now we come to the anomaly in our approach: we are creating a situation in which a people who strongly defend the causes of animal and environmental protection - causes which we support - are suffering because of us, and may lose their livelihood. We therefore have a duty to take account of the native peoples and what they require to make their living. The regulation does take account of these factors to some extent, and we have tabled some amendments which should improve the position. I hope that they will also have the support of the House.
We do not agree with the rapporteur, however, that the implementing provisions themselves should be included in the regulation. That is the Commission's task, which is for it to perform. So we would remove the items in question, but I have to stress that this does not mean that we disagree with the way they have been formulated. Basically, all the Commission has to do is copy them out. However, we believe that their inclusion here would require the House to consider every change in detail, and we do not have the time. We ought to bear that in mind. It is a job for the executive, and in principle that means the Commission.
If we bear that in mind, we may find the best way to proceed. The working party is still seeking to establish standards, and however illusory these may be, they have not yet been ruled out. Where do you draw the line between humane and inhumane methods? Perhaps the working party will eventually come up with an answer to that question.

Baldi
Mr President, Commissioner, ladies and gentlemen, it is important that we succeed in laying down international rules to enable us to reach a framework agreement on catching wild animals using traps or methods that do not involve cruelty. The availability or otherwise of any type of trap, be it the kind that kills or the kind that restrains animals, should in any event be based on standards agreed between the States of the Union, third countries and the indigenous population, with professional trappers, those who study wild animals and veterinary experts being consulted.
The negotiations currently under way for the definition of standards for more humane traps are going well and represent a first step towards an international agreement founded on scientific knowledge and the concern better to protect animals. That being the case, even if a final agreement has not been reached by 31 December of this year, it will be appropriate to assess the progress achieved by that point in time but not to place a radical ban on imports of pelts obtained from wild animals caught in traps.
We have, however, to bear in mind that an important part of the way of life of some indigenous peoples - the Inuit, for example - is based, for environmental reasons, on hunting and fishing which currently still represent an important economic resource. If, on the one hand then, it is vital that a framework agreement is reached on rules on trapping without cruelty, it is also necessary that those same rules should safeguard the interests of the indigenous population.
The entry into force of the rules must also allow the countries which produce the pelts of wild animals to adapt to the legislation by guaranteeing, as requested, that the methods of capture using traps which they employ for the species contained in the list comply with the standards adopted: immediate or premature entry into force would thwart the efforts so far made to facilitate methods of capture or practices which are not cruel, but would above all put at risk the livelihood of 200, 000 people involved in the pelt processing industry and employed in the Union. That is a risk that we cannot accept and which can be avoided by adopting a reasonable time-scale for the entry into force of the rules. We should bear in mind that combating unemployment is a priority not only of the individual Member States but also of the Union as a whole.
Finally, one last point: on issues of interest such as this, it would be helpful if the Commission consulted Parliament in good time and not at the last moment as has happened in this instance.

Eisma
Mr President, there is really no need to go through all this again. In 1991, the European Environment Ministers decided to ban the import of pelts from countries where leghold traps are still used. The ban was to come into force on 1 January 1996, one year after leghold traps were banned in the countries of the European Union. We were therefore totally taken aback when, at the end of last year, the Commission proposed that the import ban should be postponed indefinitely. The Commission has yielded to pressure from the fur trade and the threat from the United States and Canada that they would fight the ban on the basis of the WTO rules. The interests of trade are apparently more important to the Commission than democratic decisions to reduce the suffering of animals. The European Parliament must not make the same mistake.
What happened at the end of 1995 was that Commissioner Bjerregaard lost out to Commissioner Brittan, and I think she should be ashamed that things were allowed to go so far. The European Parliament must reverse the Commission's decision. I can only agree with Mr Pimenta when he says that once legislation has been proposed, the result can never be that no legislation is adopted, since this would set a precedent that would undermine the credibility of the Commission and of the whole Community decision-making process. That would be completely unacceptable for us. We all know that leghold traps deliberately condemn animals to a slow and lingering death, which is what makes the pelts such good quality and brings the best prices.
Leghold traps are extremely brutal instruments and must be banned. There must be more humane trapping methods, but we in the House must not allow ourselves to be blackmailed by postponements and other tactics into delaying the approval of these methods.
Throughout the whole debate, the importance of leghold traps for native peoples has been deliberately exaggerated. The Commission wants to introduce an automatic exemption from the import ban for native peoples, but such an exemption would undermine the whole directive. I entirely agree with the rules proposed by Mr Pimenta on the subject.
We should give Mr Pimenta's very detailed report our fullest support, but we also wish to see some immediate action. One of the things the Commission must do now is to publish the list of countries which do not use leghold traps. It should be required do this within the next month, otherwise Parliament will take it to the Court of Justice. I should like to ask the Commission whether it intends to publish this list in the immediate future?

González Álvarez
Mr President, Commissioner, if we agree that leghold traps are a cruel and inhumane means of trapping animals, and if the European Union has banned their use within its territory, it is surprising that the import of pelts from third countries in which animals are caught by means of these traps should be accepted.
The successive postponements of the entry into force of Regulation No 3254 cast doubt on the Commission's political will to comply with Community law, when it should be setting an example in this respect to the Member States. The Commission knows that the talks between Canada, the United States, the European Union and Russia aimed at establishing humane standards may go on for ever; it is extremely difficult to determine these standards. Mr Pimenta's proposals include the necessary implementing provisions, take account - in various amendments - of the social and economic implications of the regulation for the indigenous peoples, and bear in mind the responsibility of the Member States to help improve those peoples' living and working conditions. They provide for the ban on imports to be lifted once credible rules, including a reasonable implementation period, have been agreed.
Commissioner, we all know that without clear rules and specific deadlines it is very difficult to ensure compliance with Community law. We have seen this with regard to the legislation on the substances that are destroying the ozone layer and on CO2 levels, and we are seeing it with regard to this regulation. This regulation must be implemented, if we wish to ensure respect for, and the credibility of, the Community's institutions.

Bloch von Blottnitz
Mr President, this is lunacy! Here we have a five-year-old regulation - a piece of legislation adopted by the Council - and the Commission simply digs its heels in and fails to put through the implementing provisions. Is this what we can expect to see in future? Along comes a lobby group - in this instance the Canadian, American and Russian fur industry - and kicks up a big fuss, and we are left with nothing. If that is the shape of things to come, then we can save ourselves a great deal of work. I think it is outrageous! Even more outrageous - and I shall not mince my words here - is the fact that virtually no notice will be taken of the amendments and proposals in Mr Pimenta's report, although they are excellent and have our full support. And where will we be then? We might as well shut up shop for half the week, because half our work is not being taken seriously by the Commission. What exactly do they think they are doing?
I shall tell you another thing. Over the next year, there are to be talks on humane trapping methods, and humane traps are to be developed. What rubbish! There are no such things as humane traps. Whether or not there is a bit of padding on the teeth of a trap, the animal in it will die a miserable death. Nor is there such a thing as a selective trap. An animal cannot read a sign that says 'Lynxes please do not use this trap' ! There are no selective traps. Protected species also get caught, and trapping is simply inhumane. If people insist on catching animals, then they should be sensible and shoot them. Any other method is inhumane. I fail to see one good reason for supporting the fur lobby, hunting animal species and damaging the environment to the point that they are now almost all extinct. Damn it all, why should a few people deck themselves out in furs? There is no call for it. We must develop a different relationship with the gifts that nature has given us, and that certainly does not mean that we have to carry off the last remaining animal pelts.
As for those who are so concerned about human beings - and I hear endless expressions of sympathy for the poor native peoples - I have to tell them quite frankly that they are hypocrites. We are shamelessly hypocritical when we import uranium which continues to be mined at the sacred sites of native peoples; when forests are felled and people lose their homelands and we import the wood. Those are the facts, if you please, and I would ask the Commission seriously if it has any intention of respecting our regulations, or if the situation will simply continue as before, with nothing being done!

Barthet-Mayer
Mr President, our group firstly wishes to pay tribute to the work of Mr Pimenta, who has addressed this particularly complex question with his customary tenacity. This issue has all the elements of a psychological drama which we should very much keep in mind: the campaign against the unnecessary suffering of animals; the need to ensure the survival of northern indigenous peoples and their traditional way of life; the pressure from commercial lobbies and governments, which use unscrupulous arguments; and an interinstitutional conflict between Parliament and the Commission, which prefers to evade its responsibility to Parliament rather than risk opposing some of its partners in the World Trade Organization. On the majority of these points, we agree with the Committee on the Environment's proposals.
First of all, I should like to say that we must indeed put pressure on the negotiators to define satisfactory trapping standards. Too much time has been lost already. By ensuring that the ban comes into force as soon as possible, we shall increase the chances of achieving a result swiftly. Even if it may sound paradoxical, or even absurd, you will see why the date of last January should be retained.
It is unthinkable for Parliament to accept being presented with a fait accompli in this way. It is a question of principle. Furthermore, the procedural schedule in Parliament which is necessary to prepare for second reading and conclude this legislative procedure will provide an additional breathing space which must be used to good effect by the negotiators in the International Organization for Standardization. However, I would stress the fact that the interests of indigenous peoples whose survival may depend on hunting must also be taken into account. The inability of the Commission and their governments to conclude the negotiations must never constitute a threat to their way of life.
In this respect, while there are some sound points in Mr Pimenta's arguments, we believe that it is preferable to follow the Commission proposal. Our group will therefore be supporting the Committee on the Environment's amendments, with the exception of Amendment No 24.

Blokland
Mr President, there are two almost irreconcilable interests in the debate on the use of these inhumane leghold traps: the economic survival of a group of hunters who have no other means of earning a living in the short term, and animal welfare. From the outset, Mrs Sandbæk and I have adopted the position that the native hunters must not be deprived of their livelihood, and I am pleased that the amendments from the Committee on the Environment now specifically call for attention to be given to this threatened group.
We too are aware that the number of genuine native hunters is relatively small, and that they are just about able to support themselves. But this is no reason to stop them selling any more furs at all because of the trapping methods which they use. Here in Europe we apply transitional measures in all kinds of situations, and I see no reason why we should not do so with trapping methods. This is, after all, what this group of people relies upon to earn their daily bread.
We very much hope that all the political controversy surrounding this piece of European legislation will finally result in the speedy introduction of safer trapping methods. There can be absolutely no doubt, as far as we are concerned, that these barbaric traps must be abolished.
The Pimenta report is, in my opinion, a good compromise between the various viewpoints. What I should now like to hear from the Commissioner is what is happening about the proceedings against the Netherlands, which has declared that the regulation will come into force as originally scheduled on 1 January?

Lukas
Mr President, the rapporteur deserves to be thanked for taking over the job of doing the Commission's homework. As we approach the end of the millennium, our society must give the same priority to preventing cruelty to animals - preventing unimaginable and prolonged suffering among living creatures - as it does to consumer protection. Preventing cruelty to animals is almost a form of consumer protection from a different angle. It means protecting consumers from going about clad in the fashionably processed suffering of mammal species. A person's ethnic origin can never entitle them to use cruel trapping methods.
It is quite amazing that the USA and Canada have so far refused to recognize that leghold traps are inhumane. It is scarcely possible that regional development and the welfare of the people concerned should depend solely on the use of leghold traps, which are not even a traditional trapping method.
We should also recognize clearly that the decline in recent years in the sale of furs and skins is part of a pattern of changed practices on the part of consumers. By following the proposals of the rapporteur, the European Parliament would be sending out a positive signal.

Banotti
Mr President, as I stated in the last discussion about this issue, I was the hapless rapporteur on the first report on the leghold trap. That was in 1990. In the course of preparing my report I did a great deal of research; I took it extremely seriously. I was the butt of - as Mrs Pollack has said - some of the most ferocious lobbying ever seen in this Parliament.
I am very happy indeed that Mr Schnellhardt has said, on behalf of my group, that we will be supporting Mr Pimenta's report. But I wish I could agree with my colleague, Mr Schnellhardt, that the Commission should be left to get on with the job. I do not think it has done, and I do not think it did in the past what this Parliament asked it to do in 1990.
Mr Pimenta faces the issue that was the most agonizing for me, personally, in my work on the report: the serious concern he has for the indigenous people in Canada. I met them. I went out on a trap line. I have seen exactly what happens there. As a result of what I saw then I deliberately set out to give longer time to develop an alternative method of trapping in order to cause the minimum amount of difficulty to the indigenous people in Canada. But unfortunately it took quite considerable time for anything to be done on that. It was clear when I was in Canada in 1990 that nothing had been done on it up to then.
What I think happened was that the Commission just kept its head down and hoped that it would all disappear; that it was a flash in the pan and that nobody would take it terribly seriously and nothing would have to do be done about it. But a lot of attitudes have changed radically in the last few years, particularly on issues of animal welfare. Nobody ever thought that the poor old cows or sows or whatever were really being taken seriously. In the last few years we have started to look on these as moral issues. I think we have to continue to do so.
I am very happy to support Mr Pimenta's report.
Finally, if I lived in northern Canada in the cold and wind that exists there - and I lived in Canada for well over a year in the 1960s - I would wear a fur coat. I would probably wear one of those long furry things that were quite cheap and very practical at the time. But the market for fur coats now has generally collapsed. It is really only those rich people who live in southern hot countries who are buying them. So I ask myself: do we really need to go the wall about a political issue like this? But the trap that Mr Pimenta has held up is evidence that this is a very nasty piece of work. By now we should have found some alternative to it.

Ripa di Meana
Mr President, intimidated by the threats of the Canadian and US Governments to appeal to the World Trade Organization, the Commission agreed, in July 1994, to suspend for a year the entry into force of the rules. As was absolutely predictable, that postponement failed to produce the hoped-for results in the search for traps that do not involve cruelty. Once that deadline had expired, the Commission took it upon itself illegally to suspend the entry into force of the regulation itself as of 1 January 1996, for the sole purpose of according the Americans and Canadians a further opportunity of developing so-called 'humanitarian' trapping standards.
That task, which the North Americans in fact gave to the ISO - the International Standards Organization - back in 1987, has proved hopeless for two reasons: the clear impossibility of developing trapping methods that are not cruel and the substance of the research which focuses less on studying improbable methods of trapping without inflicting pain than on legitimizing those methods already used by Canadian and US trappers.
It is therefore vital that the House confirm robustly and resolutely that it is a matter of the utmost urgency that the general principles of Regulation No 3254/91, on which I worked, as a Commissioner, along with Parliament in the early nineties, are complied with: if it is allowed to slip further the real intention will be to get rid of it for good.
It is in that firm belief that, as mentioned by Mr Bloch von Blottnitz, the Greens are prepared to support the amendments to the Commission text tabled by Mr Pimenta: Amendments Nos 19, 20, 21, 22, 23 and 28 in particular remedy the unacceptable loopholes which the Commission proposal to amend Regulation No 3254/91 would allow for the purpose of continuing to bring into the European Union pelts obtained using traps.

Bjerregaard
Mr President, this is not the first time that I have had the opportunity of discussing this issue with the House; several speakers have already described the course of events, and so I shall confine myself here this evening to the formal response which can be given to today's debate. First of all, I should like to thank the rapporteur, Mr Pimenta, for his report on the extremely vexed question of leghold traps.
I know that the Commission and Parliament essentially have the same goals in this area. We differ as to how those goals can be achieved. As is made clear by Mr Pimenta's report, Parliament is in favour of introducing a trade ban and then discussing the conditions for it to be removed. You will be aware that the Commission's stance, following its most recent decision, is the opposite, and we have therefore already had talks in the quadripartite group - including the USA, Canada and Russia - with a view to achieving results before we begin to consider what further steps can be taken. Given the fundamental difference in our approach, it will come as no surprise to the House that the Commission is unable to accept the proposed amendments.
In addition, there was a direct proposal from Mr Eisma, who asked me for a response to Parliament's letter of 13 May to the Commission. The Commission has not yet come to a decision on the request from the President of Parliament for it to publish a list of countries which prohibit the use of leghold traps. Naturally, the Commission will respond to this request within the deadline which it has to give a reply.

President
Thank you very much, Mrs Bjerregaard.
The debate is closed.
The vote will take place tomorrow at 12 noon.

Market organization in beef and veal
President
The next item is the report (A4-0203/96) by Mr Jacob, on behalf of the Committee on Agriculture and Rural Development, on the proposal for a Council Regulation (COM(96)0242 - C4-0291/96-96/0148(CNS)) providing for additional payments to be made in 1996 with the premia referred to in Article 4b(6) and Article 4d(7) of Council Regulation (EEC) No 805/68 on the common organization of the market in beef and veal and amending Article 4i(4) of that Regulation.

Jacob
Mr President, on this report, the Committee on Agriculture and Rural Development unanimously agreed to the Council's request for urgent procedure, in view of the extreme urgency, complexity and sensitivity of this issue for all beef and veal producers, as well as all European consumers.
Firstly, I should like to say that I am presenting this report on behalf of the Committee on Agriculture, in my capacity as chairman of that committee.
The proposal submitted to us by the Commission is, in my view, fundamentally balanced, in that it contains a section devoted to specialized breeders - in other words, producers of suckler cows and young bovines - and another section devoted to the national element, which will enable each Member State to adapt and respond according to its own specific circumstances.
I tabled a number of amendments which did not receive the support of the Committee on Agriculture, and which I am now retabling in plenary on my own behalf. These amendments seek to increase the aid to specialized producers to ECU 50 for each animal. What seems essential to me in this debate is to support those specialized farmers and breeders in Scotland, Ireland, Italy, Portugal and France who live from the production of beef and veal alone and whose future depends on this activity, as opposed to other farmers who are undoubtedly affected by the crisis, but who produce beef and veal alongside other activities. I therefore believe that it is important to support these specialized producers, whose animals have never seen an ounce of meat meal in their lives, because they are reared on grass. There are producers of this kind throughout Europe. These are the producers who should be supported in particular, and that is why I am proposing to increase the compensation to ECU 50 for suckler cows and young bovines.
I am also making this proposal in order to send a political signal, because all that people can find to say to me on this subject is: ' The package will be inadequate, and so we shall have to show self-restraint and distribute it as widely as possible' . I am surprised, however, by those who are defending this kind of argument. They are the same people, one should remember, who react vigorously from time to time to prevent the common agricultural policy from being touched, saying that they are against renationalization. Now the same people are rejecting all those amendments which are designed to support specialized producers, in favour of distribution by the Member States. If there is one category of breeders who should be supported, in my view it is traditional breeders. Undoubtedly, other breeders are affected, and that should be taken into account. But let us not forget those who are currently losing around FF 2000 per animal, and who are now in an extremely difficult position, because they have no borrowing arrangements, few investments and social security entitlements, and low incomes - an average of FF 50 000 for beef and veal producers. For such farmers, the consequences of this crisis are dramatic.
It is therefore necessary to increase the package proposed by the Commission. This package is inadequate - and I am sure, Commissioner, that you are aware of that today. Given the extent of the crisis, there is a need to increase the proposed package substantially in order to provide support for these farmers, whose role goes beyond the mere production of beef and veal and is very important in terms of the development and management of Europe's regions.
I have therefore tabled these amendments, and another which I should like to deal with by supporting the amendment by my colleague Mr Happart concerning the increased use of plant proteins in animal feed. I entirely endorse this amendment. I believe that it is essential. This means, however, that there is also a need to renegotiate a number of matters. The agreements on plant proteins concluded during the GATT negotiations must be discussed again. They no longer hold good! Similarly, we must have an assurance that meat meal has not been used in the production of imported beef and veal, since the current situation will give rise to an increase in protein prices to the benefit of third countries - which has already begun - since the European Union has a substantial shortfall in protein production.
In conclusion, Commissioner, I believe that it is important to support specialized producers, and so I am retabling my amendments in a personal capacity, even though they did not obtain the support of the Committee on Agriculture. Furthermore, I also believe that it is important to strengthen the European Union's capacity for protein production, since given the extent of the crisis, we cannot accept the GATT agreements in the form in which they were concluded. This sector must therefore be completely redeveloped.

Fantuzzi
Mr President, Commissioner, I take a slightly different view from Mr Jacob, although I respect his opinion: while it is right to applaud the speed with which the Commission moved to take this measure to support producers affected by the BSE crisis, it has to be said that in substance that particular measure is the source of a good deal of injustice.
While the Council had said that it was necessary to support in the short term all beef and veal producers, with the idea of earmarking no less than ECU 534 of the ECU 650 for the supplementary premium for male cattle and suckler cows, in my view, the Commission is ending up by helping only a section of European producers. And it is precisely those producers that are already enjoying the largest helping of aid from the common organization of the market in beef and veal. It is true that there is a need for speed and to commit spending, which has to be kept within very strict timescales, but it is also the case that there is something to think about here: I ask you, Commissioner, to consult the table that appears on page 49 of the first volume of this year's price package from which it is clear that there is a small minority of countries which have many more premiums than they do head of beef cattle and a majority of countries where the imbalance is precisely the reverse.
We could discuss at length, Mr Jacob, whether there are specialized producers and, if so, which producers they are and whether priority should be given to that group or to others. But what I do not want to see this evening is those producers who have specialized in obtaining premiums being advantaged.
I believe that all should be given the same opportunities and that Parliament's amendments - at least those of the Committee on Agriculture and Rural Development whereby the flexible portion available to the Member States would be increased from ECU 116 m to ECU 424 m - will make it possible largely to resolve this problem.
More resources would certainly have been better but we have to be realistic. We have then to be very careful to check that national aid becomes the exception and not the rule. I ask you, Commissioner, whether we ought not to conclude from this that some kind of review of the COM in beef and veal is needed, and whether the time is not now ripe, given the news we have heard, to move on to other measures, since the eradication programme seems to be beginning to achieve some results.
You, Commissioner, have had the courage to take difficult decisions which have laid you open and continue to lay you open to criticism and probably will cause acute tension in the European institutional balance in Florence two days hence. I therefore believe, Commissioner, that it is very important that there should be mutual understanding between Parliament and the Commission and a shared perception of what we want to do and the way to do it, including as regards this evening's measures. I therefore believe that it is for you this evening to show consideration for the work of our committee - our group, the Socialist Group, is counting on this.

Funk
Mr President, since early 1996, when the British Secretary of State for Health reported that new cases of Creutzfeldt-Jakob disease had occurred among humans in the United Kingdom, beef consumption has once again plummeted. The market for beef has collapsed not only in the United Kingdom, but in virtually every region of Europe, including Member States which have not had a single case of BSE. Thankfully, the Commission has taken a range of measures, including buying in beef and an export ban to protect consumers.
To reduce the impact of the heavy losses suffered by beef producers, the Commission promised an emergency programme. For technical reasons connected with the budget, that programme must be paid for immediately, in other words by October 1996. We are grateful to the Commission for its proposals. The Committee on Agriculture and Rural Development has considered the document that was submitted and has formulated a number of principles for approval by the House.
The committee is calling for a standard subsidy for suckler cows and male cattle. The subsidy should amount to an additional grant of ECU 10 per head. At the same time, I must acknowledge that dairy farmers have also suffered losses. The price of cull cows and calves has fallen just as sharply as that of beef cattle. Furthermore, the Commission itself admits that it will be hard to include all the stock that should, in fairness, attract compensation payments. Let me give you one or two examples: for instance, those cases where farmers are claiming subsidies for growing pasture instead of livestock premiums, or where they have not kept within the limit of 2.5 livestock units per hectare. Virtually all the farms in these categories will be excluded, because they are not currently entitled to premiums.
For those reasons, the committee decided to increase the proposed sum to be made available to the Member States to compensate for losses that would not otherwise be covered. In the short time that is available, it will not be easy, even for the Member States, to distribute this money in such a way as to compensate farmers to some extent for their losses. We should therefore give the Member States as much latitude as possible, so that they can get the money to the farmers in good time. We have to be clear that these subsidies are only a drop in the ocean. Nonetheless we must make the most of them. I shall be grateful to you if we can find a viable means of doing so.

Santini
Mr President, Commissioner, in my view, the Council's proposal for a regulation properly has the air of an emergency measure in what is developing into a real crisis, not only from the economic point of view but also because of its political and institutional implications. It seems to me, however, that the haste has been ill-advised because instead of remedying situations of hardship, the measure is likely to compound the imbalance and the discrimination that exists between those countries which already make full use of Community resources and others that suffer from an historical disadvantage linked to the system of producer premiums.
In the table of statistics, mentioned by Mr Fantuzzi and annexed to price package for which I was the rapporteur, we voted, at the last part-session, for a state of affairs that is worrying to say the least. There are countries which receive amounts far in excess of their entire production. Right at the head is Luxembourg with 227 %, followed by Ireland with 147 % and France with 123 %. At the bottom, needless to say, is Italy, which has received only 29.6 %, although with 2, 200, 000 head, it is Europe's main producer. It is not my intention to pave the way, here in the House and in these circumstances, for national claims, but it is at any rate right to ask the Commission and Council to prevent chronic under-utilization of Community resources becoming the inescapable rule for emergency measures.
The subdivision into the three methods of intervention - suckler cows, male cattle for fattening and the national element - seems to be completely inappropriate and allows only 30 % of Italian producers to have access to the premium. We therefore propose concentrating resources as much as possible on the national element by unhooking the measure from the system of premiums. But that is not enough: it also seems appropriate to give the Member States the opportunity to award national aid to offset the loss of income on cattle excluded from the premium. To conclude, Commissioner, the resources of ECU 650 m are clearly inadequate. It seems then that in Italy alone we are talking about an estimated ECU 250 m. And so I ask myself, with no more than a hint of bitter irony: will the other fourteen countries be content with the remaining ECU 400 m?

Mulder
Mr President, in our opinion the Commission is entirely justified in proposing to make ECU 650 million available for dealing with the effects of the BSE crisis. The crisis which individual farmers are currently facing is not their fault, it is the result of failings on the part of the governments. And if it is the governments which have failed, it is also up to the governments to put things right again.
We wonder whether ECU 650 m will be enough, but I am assuming that it is not possible to make more available at the moment. We do have some fairly major objections to the Commission's proposal itself, which as we see it gives an unfair advantage to extensive cattle breeders. The BSE crisis affects all beef producers, both extensive and intensive farmers. We therefore feel that measures must be taken which deal with both sectors fairly.
The amendments which have been adopted by the Committee on Agriculture are definitely heading in the right direction. More is still provided for the extensive farmers, but the national governments are now in a better position to provide support for the intensive farmers too. This gives the Member States the scope to channel aid towards the sectors which they judge to have been worst affected. We think it is also very important that this should not mean the renationalization of agricultural policy, as Mr Jacob suggested. It does not need to be. The Commission must be careful to keep a close eye on competition, but it is primarily up to the Member States to take the lead here.

Barthet-Mayer
Mr President, I spoke earlier in the debate on leghold traps. Now, however, I should like to put things in perspective: cattle breeders - and, by extension, the entire beef and veal sector - are today the human victims of the economic consequences of the epidemic of mad cow disease that has been raging since 1986.
For several years, beef consumption has been falling in Europe. For the last three months, the beef and veal sector has been totally disaster-stricken throughout the European Union. As time has passed, it has become absolutely vital to draw up a rescue plan for the beef and veal sector, from the producer to the retail butcher. Such a plan requires a coordinated, comprehensive and united approach. Among the possible measures, the matter of greatest urgency is immediate compensation for producers, in order of priority. Firstly, there are the specialized beef and veal producers with herds of suckler cows. Beef is the only source of income for their farms. They have taken the full force of the crisis, and their loss of income is in direct proportion to the fall in prices. What are they doing? They are waiting, while millions of cows grow fat in the fields and a solution is postponed. And secondly, there are the dairy farmers, for whom beef nevertheless represents around a quarter of their income, in the form of veal calves and cull cows.
Tens of thousands of breeders, whose loss of earnings is currently put at between FF 1500 and 2000 per head of fattened animal, are waiting for our decision with impatience. They will find it hard to understand why we have reduced the proposed aid to an additional ECU 10 per premium. I ask myself, moreover, whether we were not unwittingly misled at the time of the vote in the Committee on Agriculture the other day.
Consequently, I call on the House - without, of course, rejecting the Committee on Agriculture's amendments as a whole - to support Mr Jacob's amendments, which favour non-intensive breeding. Let us not forget that in order to repair beef's image and restore consumer confidence, there is a need to discourage industrial production methods and replace them with natural methods, for example by encouraging the production of protein plants.

des Places
Commissioner, a crisis of unprecedented gravity is affecting the cattle breeding sector in the European Union. And it is to be feared that as well as being exceptionally grave, it will be exceptionally long. It took only a few days and a few decisions - or an inexcusable lack of decisions - for consumer confidence to be lost. However, there is no doubt that it will take months, or even years, and also firm guarantees of quality control for that confidence to be restored.
We must face the fact that as well as this exceptional crisis, there is a structural problem of adjusting supply to demand, to which solutions have to be found within the totally destabilized economic environment obtaining in the sector. Breeders are hostages to this situation, and they no longer know what to do. Faced with a widespread slump in sales and unduly low selling prices, they still have to meet their costs. At the same time, they are being asked to invest substantially in order to comply with environmental requirements, particularly in terms of the campaign against nitrate pollution.
The cost of setting up environmentally friendly systems of storage and effluent treatment is very high, at a time when some breeders are wondering whether to continue their activity in the current economic situation, or if they should switch to more extensive farming methods.
Since the European Union has not yet clearly indicated how it intends to resolve the economic and structural crises affecting the beef and veal sector, I think it is wise to pause before applying any measures which involve heavy investment in cattle breeding. There is surely no logic in asking breeders to invest now in plant which is of no use in the future, but for which they will still have to make the annual repayments. If we are to avoid hindering the establishment of a new European cattle breeding policy, we must not delay in showing cattle breeders, who are in the midst of a crisis, that the Union understands their concerns for the future and will not require them to invest in plant which may subsequently prove useless or unsuitable.
In conclusion, I should like to draw attention to one of the implications of changing the composition of animal feeds. If animal proteins are replaced with plant proteins - for reasons which I think are quite legitimate - we shall have to review the agreement on protein plants concluded in the context of the GATT agreements, because the European Union's rate of self-supply is currently low and will increasingly decline. It is for this reason that we shall be supporting Mr Jacob's position.

Happart
Commissioner, the least that can be said is that we were not caught unawares. It was impossible not to know. The laxity of the last few years was bound to have serious consequences. As a result, in order to restore consumer confidence, we need to follow the path of the contaminated meat meal, identify the holdings where this meal has been used as cattle feed, single out the animals which are contaminated or likely to be so, slaughter them, analyse the brain, spinal cord and lymphatic fluid, and incinerate or deeply bury the carcasses of the animals which are contaminated or suspected of being so.
The cost of the analyses and the destruction of the carcasses, as well as that of the compensation for the loss of earnings of the beef and veal sector as a whole, should of course be borne entirely by the producers of this type of cattle feed. Those who have cheated have to foot the bill - and I am choosing my words carefully. It is unacceptable, it is criminal, that meat meal deemed unfit for consumption in the United Kingdom should have been exported for consumption in other countries.
If the directives on the labelling of food products were applied throughout the Union in such a way as to indicate the region of breeding and slaughter, consumers would be able to decide in a more informed way whether or not to buy this product. It would only be necessary, for example, to label meat from the United Kingdom 'British beef' for consumers - households or restaurants - to know exactly what they were buying.
In any event, the BSE crisis has demonstrated the fragility of the European Union, the instinct for renationalization, and the failure - or rather the non-existence - of European policy.
Consequently, Commissioner, I should like to ask you the following question: to which budget will the administrative costs of providing these ECU 10 or so of compensation per animal be charged?

Gillis
Mr President, first I would like to thank the Commissioner for coming forward with the proposal so promptly. I welcome the idea of setting aside a portion of the package to be distributed by the individual Member States to meet the needs of farmers facing acute financial problems. However, the crisis in the beef industry is unprecedented and much deeper than anything witnessed in the past. The losses to livestock farmers are colossal. In Ireland alone it is estimated that losses so far - since 20 March - are in the region of Irish £250 million. The price fall has not yet levelled out.
In my view, stability will not return until decisive, radical and refocussed eradication measures are put in place and are seen by consumers to be producing results. Losses will continue for as long as we have not restored consumer confidence through total and complete eradication. It is obvious that the size of this package is totally inadequate to meet the real losses incurred by farmers. A package several times greater would be necessary to compensate farmers even for the losses incurred so far.
I therefore propose that the fund be substantially increased. As a first step the package should be increased to ECU 1, 000 million. Also, the situation must be kept under constant review. The ECU 116 million - that is, ECU 9.5 million for my country, Ireland - to be distributed to Member States to meet cases of acute financial distress is also inadequate. Whatever the final figure is, we must ensure that this money is also used to support the producers of heifer beef who, under the present system receive no premium or compensation of any kind. Their losses have been greater than those of the producers of male cattle. This needs to be recognised and included in the package before us.

Hyland
Mr President, I wish to acknowledge the Commission decision to provide ECU 650 million compensation package for farmers who have and still do experience serious financial losses resulting from BSE. The collapse of the beef market is undoubtedly the most serious catastrophe to hit European agriculture and indirectly, employment in the agri-food sector.
Scientists differ in their interpretation of the impact, if any, of BSE on public health. Consumers are understandably concerned and confused. In the process European farmers - the people on whom we rely to produce our food requirements - are in serious financial difficulty, so much so that many of them, even with compensation, will be forced out of business. In relation to the proposed compensation package I would say to the Commissioner that payment should be fast and efficient. There is no need to remind the Commissioner that the beef sector, even before the advent of BSE, was in financial difficulty. The problem with export refunds and the associated difficulty of developing third country markets had a bad impact on the profitability of the entire European beef sector.
In our desire to compensate all farmers affected, and in particular the farmers most affected, we should try avoid introducing an over-bureaucratic system which would only tend to slow down the payment of compensation. I believe we should use the existing established structures of the special beef premium and suckler cow grants, both of which are part of the agreed CAP framework, as a means of determining the shareout of the additional funds between Member States while at the same time allowing individual governments to decide how best the package can be applied to each sector. I also believe that as a short-term measure and for the purpose of dealing with the build-up of animals due to the market collapse, beef heifers should be included with steers as being eligible for compensation.
I do not believe that the compensation package of ECU 650 million is sufficient, but it is a start. We must put the system in place immediately for its implementation.
My concluding comment is: get this money into the system fast; intensify our efforts to restore consumer confidence in beef as a quality food product, which is what it is; and assist in every way possible to develop third country markets as a profitable outlet for European beef.

Billingham
Mr President, I seek to paint a broader picture here tonight. A week ago I brought four workers to Brussels to make their case for recompense. They were workers from the Midland Meatpackers, one of the many abattoirs in my constituency which has been cruelly hit by the BSE crisis. They represented hundreds of workers who have already lost their jobs or whose jobs are under threat. They came to Brussels to seek justice. They are the hardest hit sector of the whole beef industry for their skills are not transferable. So they see themselves as having no future. They have lost everything. In two days they met many of the influential people and groups within Parliament. You, yourself, generously gave them some of your time. The workers returned home to Northamptonshire buoyed-up and encouraged by the support from all sides. You, Commissioner, are on record as saying that those most severely affected should have priority funding. But fine words are cheap and that encouragement will soon melt away. I tonight would remind you of your words. I would remind you of the undertaking in the Treaty on the CAP which promises the means for agricultural workers to find gainful employment. I would remind you that money is available both in Objective 5(a) and 5(b) and in Objective 4 to find recompense for these workers. So, I have five questions to put to you, Commissioner.
First of all, do you agree that these workers are entitled to recompense and do you endorse it? Secondly, that the funding that I have mentioned should and could be used for that purpose? Thirdly, that although the UK Government has opted out of Objective 5(a) it could and should be encouraged to take that option up again and use the money accordingly? Fourthly, will you give an undertaking that all funding will be allocated on the basis of need, not just to farmers and abattoir owners but to everyone who has been so cruelly affected by this appalling disaster? Finally, will the Commission urge the UK Government to use the contingency funding at its disposal to offset the job losses?
If you give these undertakings, Commissioner, you will demonstrate that the European Union is indeed an institution that has at its heart the wellbeing of all its citizens irrespective of influence, status or political favouritism, and as such you will be an institution that will be applauded.

Hallam
Mr President, I would like to add my voice to those expressing their concern about those beyond the immediate farms who are being affected by this crisis. A county council in my constituency, Shropshire, has produced this report. I believe it is the first report of its kind to look at the local impact on the economy of the BSE crisis. It paints a very worrying picture. We already know that at least 700 jobs have been lost in meat processing, road haulage and in the markets. We also know that an estimated £100 million has been taken out of our local economy and that will have further knock-on effects.
We also know that this impact is being felt most acutely in our small market towns which already have fragile rural economies and that is why they already qualify for Objective 5(b). This is a blow that they just cannot cope with. We now need to focus on how we can bring help to those people. We need to look at Objectives 5(a) and 5(b). Possibly we need to look at something like a RECHAR or RESIDER programme for agriculture, but action is needed very, very quickly.
Commissioner, I have your copy here. I will give it to you before you leave tonight. There have been reports on the BBC tonight that the Commission meeting here has worked out a formula for the end of the ban on British beef. I would be very grateful if tonight you would tell us exactly what that formula is so that we can report it back to our constituents.

Martinez
Mr President, losses have been suffered. Very large losses have been suffered, Commissioner, in this animal health disaster. We could have dealt with this disaster on the basis of a simple principle - that of the assumption of responsibilities: by the British producers of Doncaster, in Yorkshire; by the British Government; and by the French importers. You have opted for the principle of solidarity. You are making the responsibility collective, and that is all very well.
On this basis, compensation should be provided for all losses. But no, you have decided on a figure of ECU 650 million for the 81 million cattle that are affected. That actually makes ECU 8 per animal. According to the proposal, it is ECU 10 per animal. Mr Jacob's proposal of ECU 50 per animal - which is little enough - has been rejected. And the idea of an additional premium for non-intensive farms has been rejected too.
In other words, you have rejected responsibility in favour of solidarity, and you have dismissed solidarity in favour of greed, mediocrity and accounting. Nor is there any provision for preventive measures - Mr Happart referred to this - or the renegotiation of the agreements on protein plants and oilseeds.
I must say, Commissioner, that this affair is getting off to a very bad start. I am not addressing you personally, but the Commission as a whole, as well as your predecessors, who bore a very great responsibility and who, when the time came to meet that responsibility, did very little, as the records make clear. Put yourself in the place of the cattle breeders. I understand why they have doubts about European integration and the protection that it will afford them.

Fischler
Mr President, ladies and gentlemen, I should like to begin by thanking the House sincerely for the urgency with which it has addressed the important issue that we are debating today, and also for the speedy way that the Committee on Agriculture and Rural Development, and particularly its chairman Mr Jacob, put together this report.
The first point I have to emphasize is that since 20 March, beef producers throughout the European Union have found themselves in a major crisis and have been facing serious financial pressures. Since that date, the Commission has initiated a whole range of measures, starting with the opening of intervention which has already accounted for 150 000 tonnes of meat, with a further 30 000 tonnes earmarked for intervention in June. We have made use of every market instrument at our disposal, from an increase in export refunds to private storage, in order to at least reduce the impact of the problem.
Like you, however, I am aware that all of this taken together is not enough. We must go a step further and provide additional income subsidies. There is a general consensus - and this was evident again from today's debate - that producers must be helped as quickly as possible, with a minimum of red tape. However, this also means that we must organize the income support within the 1996 budget. The fact that the EAGGF year ends on 15 October means that we must design our measures in such a way that they can be implemented before that date. We therefore began by trying to estimate the loss of income among beef producers which could be expected in the current year, and to establish how much scope we had in the 1996 budget. On that basis, we came up with the figure of ECU 650 million which is being discussed today. As I told the House earlier in the month, an additional ECU 200 m has been earmarked for support measures in connection with BSE. When that is spent, however, we shall have exhausted all the scope available to us, according to the current estimates of our budget margin for this year. This means that we cannot go above the sum of ECU 650 m.
We then come to the question of how the ECU 650 m is to be shared out. Under the first proposal, made by the Commission on 20 May, additional payments were to be provided only to those producers who had claimed premiums for suckler cows or male cattle in the previous year. While this option is a very simple one to implement, it does, of course, have certain disadvantages. The Member States therefore sought a more flexible approach and called for account to be taken of those issues which were not addressed adequately in the proposal.
In response, we came up with a flexible arrangement for 20 % of the ECU 650 m total, a figure of ECU 116 m, which was to be shared among the Member States, with the option of including in the distribution of that sum those producers who are receiving no premiums, or only limited premiums.
According to the amendments from the Committee on Agriculture and Rural Development, it is now proposed to allocate a larger proportion of the total for national distribution and a smaller proportion for topping up cattle premiums.
However, an option as far-reaching as this would lead to serious problems, particularly as regards the coherence of the measures in question, and above all would jeopardize the main objective of getting these sums of money paid out to farmers quickly, in other words before 15 October.
This objection concerns in particular Amendments Nos 1, 5, 6, 7, 8, 9 and 13. Also, a considerable period of time would be required to set up appropriate new administrative and indeed monitoring mechanisms in time to be effective, and this would create difficulties that would make it impossible to ensure that the resources were shared out in good time. However, the Commission recognizes Parliament's wish to create greater flexibility and will convey that concern to the Council, to the extent that it does not jeopardize the main objective to which I have already referred.
As for the request that the Commission should do its utmost to ensure greater use of plant proteins in animal feed, and to guarantee that cattle are fed solely on plant rather than animal products, I must emphasize on the one hand that there is already very considerable support for plant protein cultivation in the European Union, and on the other that a prohibition on feeding animal or bone meal to ruminants has been in place for some time, and of course we intend to retain that prohibition in the future.
Moreover, we believe that we must take a rather cautious approach to further intensification of stock-farming, particularly in view of likely consumer trends in the Union. Finally, as regards the option of providing national subsidies, I would point out that measures of this kind were applied during the last beef crisis in 1990 and 1991. By providing government subsidies, Member States can address specific problems of their own that are not fully covered by the Community resources.
On the question of assistance for those employed in the processing industry, I would remind you that I addressed that issue in depth during Question Time earlier today. President Santer, in his speech tomorrow morning, will give his detailed views on the Commission decision this evening on the so-called framework programme submitted by the British Government.

President
The debate is closed.
The vote will take place tomorrow at 12 noon.
(The sitting was closed at 12 midnight)

