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

Rosado Fernandez
Madam President, I would just like to say something, and I will speak in French so as to be more quickly understood by everyone.
Yesterday I raised a question which our 'Superior' - because I consider you a monk of this monastery - judged to be a personal matter. I must obey him and I do so with pleasure, in view of the liking I have for him. However it was not a personal matter, it was a political question. Indeed, when I speak as a politician, in a political context, I am no longer dealing with a personal matter which I can resolve in the corridors, but a political question which I cannot resolve with my fists in the corridors.
Madam, that is what generally happens. I wanted to defend the honour of my party. I know very well that honour is not a fashionable thing, but all the same I wanted to defend it, and I did not want lies to be spread about my party, that is all. I thereby close the subject, in obedience to the Superior of the monastery and as the monk obedient to and respectful of democracy I am pleased to continue to be.

President
Mr Rosado Fernandez, I admit that I have trouble deciding whether your speech was for a personal matter, a motion of procedure or a comment on the Minutes, but you have made it so politely that I am very willing to take note of it.

Rack
Madam President, yesterday the President read out the ratification of the appointments of various Members, following verification of their credentials by the Committee on the Rules of Procedure. However, I see that we obviously have a new colleague in the House whom the President did not mention. Since yesterday, a young man has been sitting next to Mrs Green. I should like to know which group he belongs to, and I should also like to know what the PSE Group has done with Mr Hänsch!

President
Mr Rack, I will reassure you doubly. We have not omitted to announce the arrival of a new colleague, because the person is not a new colleague. Secondly, Mr Klaus Hänsch has not disappeared from our Parliament.

Caccavale
Madam President, I wish to inform the House that yesterday I tried to obtain a copy of the Ford report, which is on today's agenda, so that I could table amendments before the deadline of 7 p.m. At 6 p.m. the Ford report was still not available in all the official languages, which clearly made it impossible for Members to prepare amendments in good time. I would ask you, Madam President, whether this is in keeping with our Rules of Procedure. Surely it is now impossible to vote on the Ford report today, given that amendments could not be submitted in time.

President
Mr Caccavale, I do believe you when you say that you could not find this report. We are going to check whether it was available in all languages and if not, it will obviously not be possible to vote on it. We are going to check, I can assure you.
Are there any other comments on the Minutes? It might also be noted that the three observations which have just been made were not about the Minutes.

Andrews
Madam President, I want to draw to your attention and that of the House the fact that Jimmy Goldsmith's Referendum Party in Britain has provided £150, 000 to the Ulster Unionist Party. I wonder if £150, 000 is the prop that keeps the Referendum Party represented in a group in this Parliament by Mr Nicholson? Is that the price to be paid for jingoism of this kind? The Ulster Unionist Party has received so much support from this House time and time again, and at the same time, in the European Parliament, we have the Referendum Party propping up a single Member with £150, 000 for the general election campaign in Britain. A political group, the Referendum Party, that is a meaningless party in Britain, is interfering in internal Irish politics. I want to protest very strongly about this.

President
My dear colleague, you are perfectly well aware that that was not an observation on the Minutes. Now, we are going to proceed in an orderly and methodical way, keeping to the subject of the Minutes, which I would like to be able to declare adopted once all of you have spoken.
Are there any other comments?

Wynn
Madam President, on the roll-call vote recorded in the Minutes, I complained profusely that my machine was not working until Mr Harrison pointed out that I did not have my card. I then asked that my vote against be recorded, but it is not on the list. Could it be recorded, please?

President
Mr Wynn, I am told that your name does appear on the list. In any case we will check. If your name does not appear, obviously we will make a note of your declaration in today's Minutes.
Are there any other comments on the Minutes?
(The Minutes were adopted)

Nicholson
Madam President, this is not the first time Mr Andrews has got to his feet in this House and made totally inaccurate statements. Knowing Mr Andrews it will probably not be the last time. I find it unfortunate, Madam President, that you allowed him to make such a statement. I recommend that in future you stand by the Rules of this House and ensure that such assertions, not based on fact, are not made. I want to make it very clear that what he said in this House was totally wrong, a parcel of lies. I totally reject what he said.

President
Mr Nicholson, you know very well that when a colleague asks to speak, one never knows if it is really a motion of procedure or not. And it is not very polite to interrupt a colleague while he is speaking.

Respect for human rights in the European Union
President
The next item is the annual report (A4-0112/97) by Mrs Roth, on behalf of the Committee on Civil Liberties and Internal Affairs, on respect for human rights in the European Union (1995).

Roth
Madam President, ladies and gentlemen, the ideal of free human beings enjoying freedom from fear and want can only be achieved if conditions are created whereby everyone may enjoy his economic, cultural and social rights, as well as his civil and political rights.
The same text appears almost verbatim in the preambles of two major UN covenants: the International Covenant on Civil and Political Rights and the International Covenant on Economic, Social and Cultural Rights. Both date from 1966 and have been signed by over 100 states.
We in the European Parliament must take the UN concept of human rights as our basis, and this comprises three central categories: firstly, what might be termed the negative rights to freedom, i.e. the right of each person to enjoy freedom from unjustified state coercion and other violence. Secondly, the positive rights: these guarantee the participation of the individual in political and social decision-making processes. And, thirdly, social rights and the right to development, which are invoked particularly by Third World countries: they insist that civil and political rights also include the conditions that are necessary in order to exercise these rights. These are the human rights of the new, the third generation. If both the rich and poor are equally entitled to sleep under bridges, this is a very inadequate and cynical type of freedom from the point of view of the latter. This freedom alone is not enough.
The purpose of social human rights is to ensure freedom, equality and codetermination under the conditions of an industrialized society. Social human rights complement the traditional liberal freedoms. And this matter is worth thinking about. I remember last winter, when numerous people froze to death. The news programmes reported that they died of cold. In fact, they died of poverty.
It is easy to call for human rights elsewhere. It is far more difficult to admit to shortcomings in one's own country. We have often enough condemned crimes elsewhere: Turkey, China and Iran. This report, however, is about our own failings. If we are to be credible, we need to examine conscientiously our own human rights record in the European Union. We cannot - and must not - console ourselves with the thought that the situation is much worse elsewhere. As Bertolt Brecht said: ' Let everyone speak about his own disgrace' .
In drawing up a report on the human rights situation in the European Union, we must avoid hypocrisy. We cannot - and must not - create a separate European Union human rights concept. That is the true meaning of the frequently quoted remark: ' human rights are indivisible' . In speaking of the human rights situation in the EU, therefore, we must adopt a holistic approach, and not say like the Pharisee in Luke 18, 11: ' God, I thank thee that I am not as other men are' .
This report is accused of being biased. Of course it is biased - biased in favour of human rights! There is no such thing as a neutral, disinterested human rights report. There are only two options: a report which tries to describe the situation accurately, without concern for sensitivities; or one which plays down, covers up and glosses over, which treats what happens in our own countries as at most a pardonable sin, on the basis of the maxim that, compared to the situation elsewhere, things are not so bad in the European Union. But the theory of relativity belongs to physics, not in a report on human rights.
This report clearly addresses the situation in the individual EU Member States. Anyone who criticizes this as interference in the internal affairs of states shows his ignorance of international law. It is now generally recognized that human rights - and this was recently confirmed at the 1993 Vienna Conference on Human Rights - are no longer the internal affairs of individual states. No government - not even a European one - can justifiably complain of unacceptable interference if it is criticized for human rights abuses. Whoever wants to reduce the number of human rights - or even half them - should bear in mind the words of President Roosevelt when he formulated the anti-fascist war objective in 1941: he said that freedom from material want should have the same status as freedom of speech, freedom of belief and freedom from fear. It is impossible to define human rights more simply or poignantly. Roosevelt was 25 years ahead of the 1966 UN covenants. In 1997, we must not fall behind him.
I should like to thank all those Members who have taken part in this highly controversial debate so far. I hope that we secure broad support for this report today. I hope that we achieve a good result, even if hurts - for a report on human rights must criticize, or it fails to serve its purpose.

Dell'Alba
Madam President, I am speaking about the presence of Commissioner Van den Broek, whom I would like to thank for coming here and following this debate.
However, I was wondering, in view of the subject of our debate - human rights in the European Union - whether Mr Van den Broek, who is already following a number of dossiers, is really the competent Commissioner in this matter.

President
Mr Dell'Alba, I am convinced that the Commissioner is perfectly competent for all subjects and particularly for this, on which he is going to speak in a moment.
(Interruption by Mr Herman: 'The Commission is a college!' Exactly, Mr Herman!

Schulz
Madam President, ladies and gentlemen, it is to be expected that what has happened in previous years here in Parliament will be repeated once again this morning, namely that the debate on the annual report on the human rights situation in the European Union for 1995 will degenerate into a discussion marked on the one hand by fundamental differences of opinion on what a human rights debate should involve and, on the other hand, by self-interested national and group tactics. The latter will undoubtedly colour the vote on both sides of the House again today, in all groups, and I regret that very much.
Mrs Roth rightly said, and the debate and vote in committee also made this clear, that it is a luxury for the European Union to draw up two different human rights reports: one on the situation in the Union, and one on the situation in the rest of the world. It is as if there were two different kinds of human rights: one for Europeans and one for non-Europeans! It is completely absurd for us to say that today's report sets everything out, but that no Member State can be mentioned by name in relation to a specific human rights abuse, and no Member State can be accused of failing to respect human rights fully and completely. Because the fact is that a debate has been gathering force in all the political groups over the last few years which is aimed at preventing precisely that, in other words saying that human rights are indivisible. Verifying respect for human rights has nothing to do with a state's membership of a political union or any other kind of international community, but a great deal to do with whether politicians, governments, administrations - it does not matter where - are capable not only of observing the fundamental rights which they themselves have established, but also of monitoring and, if necessary, enforcing compliance with those rights.
This brings me to two crucial sections of this report, which I should like to bring to the attention of the House. Mrs Roth deals with the question of the rights of people in detention. There is no better indication of how humane a society is, how closely it observes human rights, than the degree to which it respects the rights of those who have violated society's basic rules.
They are nevertheless entitled to an assurance of basic humane treatment, access to a fair trial and observance of the fundamental principles of human dignity while they are in detention. A democratic state or a democratic international organization such as the European Union - which, as Mrs Roth said, points the finger at other parts of the world, and we in the European Parliament are not exactly restrained in this respect, but seek to reinforce such condemnation - must allow the legitimacy of its criticism of the human rights record of other countries to be judged in the light of its own record. And, as far as the rights of people in detention are concerned, this report makes it clear that the situation in almost all the Member States leaves a good deal to be desired.
This section alone makes it clear, therefore, that we can longer afford to conduct such a debate - which is characterized by individual interests, and by tactics and manoeuvres aimed at securing a majority in order to prevent a disagreeable outcome - if we wish to retain even a glimmer of credibility in the long term.
There is something else that I should like to draw to the House's attention. In past years, we have sometimes had to put up with disgraceful attempts to turn the human rights report into an ideological battleground at the time of voting. We cannot afford this in the long term. I would therefore ask the House to consider, in view of the fact that we proclaim in our reports that human rights are indivisible and equally valid throughout the world, whether we need two different human rights reports. Should we not have a single report on the human rights situation in the European Union and the rest of the world, to be debated and adopted by the House? I believe that this would serve to neutralize these tactics to some extent.

De Esteban Martín
Madam President, this year as in previous years, the Group of the European People's Party has sought rapprochement and consensus in Parliament to make this annual report on human rights in the Union a balanced, structured, legally correct document which impartially reflects the true human rights position in the Union. Unfortunately the result is not what we hoped for.
Everyone knows the Group of the European People's Party promotes and upholds respect for human rights, is active in their defence and firmly opposes any violation wherever and however it may occur. That has been demonstrated not only in words but in deeds. But after what Mr Schulz has said it needs to be put on record that the Member States of the Union belong to a group of countries which guarantee full respect for human rights through democratic and pluralist political systems with effective parliamentary institutions and independent legal systems.
All the same there is no doubt that the risk of violation of those rights still exists in the Union. Such violations must be denounced before this house, but always clearly and meticulously, after detailed study of each alleged case to establish whether there has been damage to appropriate measures of protection and respect for human rights, or whether the violation has been properly dealt with under the national legal and administrative systems. Obviously, as a co-legislative body, the European Parliament must ensure that Union law develops in a context of respect for the fundamental rights of the human being, because the main aim of any genuinely democratic social project must be the freedom and dignity of the human being.
But we must stress the need for knowledge of national and international law on human rights in drawing up a report on the human rights position in the Union, as well as an exact idea of the legal concepts and strict application of precise terminology. It is also important to use legal sources as the basis for the document, not reports without legal foundation based on mere statements of principle or accusations which are sometimes unfounded. These premises are basic to the design and production of the report and if they are ignored the result may be a profusion of pre-programmed statements which make no sense, a quite arbitrary classification and processing of rights, imprecision in the use of legal concepts and excessive attention to isolated cases only reflecting exceptional situations.
Consequently the report on respect for human rights in the European Union must be circumscribed by our principal guide on the road to European construction: the law originating in the treaty. The treaty establishes the meaning of the concept of human rights to be respected by the Union and its institutions clearly and unequivocally. As Members are aware, no act or legislation emanating from the European Union or its Member States can contradict the original law of the Union as set out in the treaties. So a report on human rights must be structured on the principles contained in the Treaty of Rome.
It is true that as law, politics, and economic and social life have evolved, the States have been recognizing other guarantees linked to the welfare state. The Group of the European People's Party has therefore introduced two amendments urging the parliamentary committees covering social affairs and the environment to prepare appropriately thorough reports on respect for those guarantees as they affect their areas of responsibility.
Let me end, Madam President, by expressing my regret that the Group of the European People's Party finds it impossible to support this report, but this is forced on us because the draft report does not respect the fundamental and necessary legal basis: the Treaty of Rome. I also want to express my hope that the next report by this Parliament on respect for human rights in the Union will be a structured and rigorous document, a consensual report which is not pre-programmed, a report which does not distort reality to turn it into a political issue.

Schaffner
Madam President, firstly I am anxious to thank Mrs Roth for the work she has done and for the time she has devoted to trying to come up with a text on which there is a consensus. But in an area in which there should indeed be a consensus, difficulties arise when it comes to the details and when reconciliation of the irreconcilable is ruled out, because then we come up against some real choices of society.
One of the essential criticisms I would make of this report is that it wants to sweep over all aspects of life in society, enumerate all situations, add up all cases of appearance. It is no longer a report, it is a catalogue. In wanting to be exhaustive, the report runs the certain risk of being imperfect. The sick and the well, able-bodied and handicapped, young and old, women and men and others, free and imprisoned, servicemen and conscientious objectors, believers and unbelievers, black and white, etc. And if I may joke about such an important subject: redheads, Mrs Roth? You have forgotten redheads! Not so long ago they were the subject of serious persecution.
Seriously, though, I am still convinced that the model of the genre remains the declaration of human rights of 1789. 17 articles, not 171! Precise, concise articles which apply everywhere. Everything summed up in its first article: ' Men - from the Latin homo and not vir - are born and die free and equal' .
In wanting to do too much, one also runs the risk of defending the indefensible. In wanting to defend freedom of celebration of religions and cults, in article 26, without reference to our national legislation, you are also defending one of the greatest scourges which affects many young girls of African origin: circumcision.
Of course, our Europe is not perfect. Of course, our States still have some way to go. But here, in the European Parliament, I, like members from every State in the Union, enjoy one of the greatest rights which exist, that of being able to vote against your report.

Wiebenga
Madam President, Europe has a good reputation when it comes to human rights, and while the European Union is right to try to improve the human rights situation throughout the world, if we wish to do this with any authority, we must first put our own house in order. That is why the ELDR Group welcomes the fact that we have this debate on the human rights situation in the Member States every year.
The annual report contains a number of good points, but there are three criticisms I would make. Firstly, our group feels, after discussing the matter amongst ourselves, that the resolution is too long and that this will discourage people from reading it. We would therefore prefer to shorten it by a few paragraphs.
Secondly, it needs to be less sweeping in certain places. The situation in prisons cannot be described as bad in every case, though it is true of some.
And thirdly, the resolution mentions a number of areas where the Member States have sole responsibility, rather than the European Union. A clear example is paragraph 18 on euthanasia. The European Union does not need to legislate for this, so we would prefer to drop this paragraph altogether.
Unlike the Christian Democrats, the Liberal Group considers that the report should give some attention to basic social rights, such as the right to a healthy environment, but these are quite different from the traditional basic rights in that governments are only required to try to respect them, rather than to guarantee them.
All things considered, we hope that the debate and the votes on the amendments will produce a well-balanced resolution.

Mohamed Ali
Madam President, our democratic societies must create the necessary conditions to ensure that every person, simply by being a person, enjoys human rights, understood not only as civil and political rights, but also as economic, social and cultural rights.
We cannot speak of human rights today without speaking of social rights. Issues relating to jobs, wages, working conditions, respect for minorities, the fight against racism, and so on, have a great deal to do with human rights. Poverty is rising in European Union countries. Increasing numbers of people are victims of this evil for one reason or another and it is essential to promote social assistance and government support to combat it. We need a policy which promotes fundamental social security and genuinely guarantees equal opportunities.
A wave of racism and xenophobia is engulfing our countries and events in various parts of the Union in the last few days make it clear how serious the problem of racism is becoming. There is still discrimination against foreigners in Europe, and the law still regards those citizens as a danger to security and public order - targets for police surveillance, not individuals who enrich our society socially and culturally. Having foreigners and their cultures amongst us definitely adds a socially valuable multicultural aspect which is good for the progress of European society. We must prevent the development of a hierarchy of people. Only foreigners from Union countries are good foreigners in the European Union. All the other immigrants, whether looking for work, refugees, or whatever, are second class human beings with increasingly limited fundamental rights.
In European Year against Racism Member States have a greater duty than ever to guarantee foreign communities protection against racist violence and all forms of discrimination. And the Community institutions must give priority to funding projects geared to the fight against racism. A European society which straightforwardly aspires to democracy, solidarity and a high level of respect for fundamental rights, cannot fail to guarantee social security to all its members. And it is wrong to devalue the multicultural enrichment brought to our society by the integration of foreigners.

Orlando
Madam President, ladies and gentlemen, the annual report on human rights in the European Union can and must be an important opportunity to find out facts, to take stock and make proposals. The rapporteur, Claudia Roth, and the Committee on Civil Liberties and Internal Affairs have worked extremely hard on this report.
I should like to begin by saying that I am pleasantly surprised. This report does not actually reflect Mrs Roth's personal opinions. Rather than setting out her own opinions, which are - if I may say so - quite extreme in some ways, she has made a great effort to give a comprehensive overview of human rights in the European Union. That is why I am pleasantly surprised, and I would add that the annual report on human rights in the EU must not - as has unfortunately happened in the past - be the cause of a clash of views between different factions. I hope that this year, Parliament will manage to rise above such unproductive argument, because there are certainly other ways of measuring the numerical strength of the various groups and factions, rather than by examining and discussing human rights.
I wish to make it clear at this point that I shall be voting in favour of the report, even though I cannot go along with certain parts of it; I do, however, agree with its overall thrust and am convinced that it is useful and necessary for progress in Europe. To stress the need to overcome hidebound attitudes, I spoke out several times in committee against the rapporteur's draft, and I believe that not even she herself agrees entirely with all the paragraphs of the report.
Having read and re-read this report, I have not found any passages in it which are radically at odds with my own views. I do, of course, beg to differ on certain points, but nothing is fundamentally unacceptable - if it had been, I would certainly not have voted in favour.
The rapporteur has said this morning that, in some respects, her report takes sides. In one sense it does indeed, in that it is not restricted to human rights as defined by the International Covenant, but covers the broader subject of social rights and social security.
I should like to make one thing clear here. Given that we are dealing with human rights within the European Union, it would be unproductive not to tackle the subject of social rights and social security. In short, out of respect for human dignity and the role of this House, I hope that in the vote today, we shall manage to avoid factionalism and a distinction between human rights, on the one hand, and social rights and social security on the other.
If we were to vote on partisan lines, in a small-minded way, we should have to ask ourselves what is the point of voting in plenary if all we are doing is recording votes which are unrelated to the content of the report, but determined only by the hidebound attitudes to which I have referred, and by the composition of the groups. Quite apart from the need to respect human dignity, I believe that it is also essential to show respect for the European Parliament and its role, which must not be either passive or unproductive.

Pradier
Madam President, the work which has been done by Mrs Roth was indispensable. Of course, I realise that a number of criticisms were made on the rather rag-bag nature to which her work has been likened. No matter. I think that, whether we like it or not, to fundamental rights and liberties should be added what were once known as the formal liberties, which are those of association, opinion, expression, etc.; we must also take into account the right to receive care when one is ill, the right to education and training when one has none, the right to a decent job, the right to decent conditions of imprisonment, the right to breathe clean air. Of course. All of these rights are as inalienable as the preceding ones.
However, it is also true that borderline areas exist, and I am very pleased that the rapporteur has pinpointed a fundamental issue, euthanasia. You do not play around with life, an area in which you exercise in a very real way a social choice, and that has been stated here. Nevertheless some definitive advice has been taken here, and I would like the whole Parliament to follow her on this subject.
At the same time, it's true, what can we hope for the future? To make progress, certainly, to make progress with these rights, but really it would not be a bad thing if we could just stop regressing, because, in our countries, the rights of foreigners in particular, are being nibbled at, eaten away little by little, and defending the rights of foreigners in our land is now part of the battle for human rights.
Somebody said that we were dealing with a social choice. Yes, it's true, it is a social choice, but let us make it clear that, if we want to be faithful to what is required of us, we must work for this society in which men are open to each other, pay attention to each other, that is, for a more brotherly society. It is for that that I thank Mrs Roth.

van der Waal
Madam President, I have to say that Mrs Roth has interpreted the concept of human rights extremely broadly, but apart from that I agree with a number of the demands and statements that she makes, and I am grateful to her for including the paragraph on euthanasia.
Nevertheless, I have a number of serious objections to the report as a whole. First of all, there is the fact that it places responsibility for human rights in the Union entirely in the hands of the national governments. Of course each country is responsible for establishing and maintaining law and order, but it is equally the responsibility of each person in society to accept and comply with this. Laws and regulations are all very well, but it is we as individuals who determine the quality of the society in which we live. Think of things such as tolerance, destructiveness and anti-social behaviour. This is where the root of the problem lies, and if we are to tackle it effectively, we need a clear system of standards and values. This is what I think is missing in this report. It is merely window-dressing to try to combat the sexual exploitation of women and children while at the same time allowing pornography and advertising a completely free rein.
My second objection is that the report assumes that we are all our own independent legislators. This might seem a possible basis for a humane society, but if we do not recognize God's law in our lives, then not all human rights are safe from attack. The weak in society are given protection, but the weakest and most vulnerable of all, the unborn child, is left to fend for itself. Also, every attention is given to alternative forms of society, yet the report fails to make any positive statements about marriage between men and women, which is what God ordained.

Féret
Madam President, in this report, in this interminable inventory which resembles less a poem by Prévert and more a catalogue of a grand raffle, there is everything. I am not the only one to say so this morning. There is everything and its opposite. That is how it is that Member States are to be discouraged from thinking about the possible reinstatement of capital punishment for foul crimes while total freedom of expression is to be given to the killers of children yet to be born. In Belgium, where I come from, the death penalty was abolished one year ago. It was buried, in Charleroi, where, several months later, the bodies of young girls were being exhumed, who had been tortured and murdered.
Again we find in this report the tireless socialist cliché of the right to health, when no doctor, even the most gifted, can pretend to give it, only to dispense the best possible care for all. After that, in this order of ideas, next to the surrealist right to health, I would like to inscribe the duty of intelligence for all. This report really is in need of it.

Lindeperg
Madam President, for my part I am sorry that, as in previous years, this important report on human rights has given rise to the same interminable shilly-shallying when defining the limit of the subjects to be dealt with: the static conception of human rights as opposed to an evolving and dynamic meaning. Mrs Roth's report, of excellent quality, has not escaped polemics, and I think it is a pity. Not that the left-right confrontation appears to me to be systematically harmful, quite the contrary, but I am afraid that this opposition on such an important report might put the real division into the background, that which separates the vast majority of this hemicycle, which is conscious that the respect for human rights is one of the essential values of the European Union, from a minority, which will not rest until it has discredited this concept. Only the right to freedom of expression finds favour in the eyes of the extreme right. It calls upon this freedom better to pillory legislation which, in France particularly, permits the sanctioning of incitations to racism and the denial of crimes against humanity.
That is why I would like to recall the fact that the United Nations committee responsible for monitoring the application of the international treaty on civil and political rights by the 133 signatory countries made an important decision last November. It nonsuited the negationist Robert Faurisson, who was claiming that the loi Gayssot attacked his freedom of expression and education. The committee considers that it does nothing of the sort and that freedom of expression can be subjected to restrictions necessary for the respect of the rights or reputation of others. You might think this goes without saying. But it undoubtedly goes much better for being said.

Nassauer
Madam President, ladies and gentlemen, the original aim in drawing up this report was to legitimize the European Parliament's condemnation of human rights violations in other parts of the world. The report has moved a very long way from this initial approach. It no longer has that purpose. Indeed, it is difficult to see how this report can legitimize Parliament's criticism of human rights abuses in China or Zaire. I should like to give you an example. The report states that the European Parliament 'advocates the drawing-up at Community level of a binding legal instrument laying down minimum guarantees in respect of income, social protection, and the right to medical treatment and housing' . With respect, Mrs Roth, how does making such a boundless demand legitimize Parliament's condemnation of human rights violations in Zaire?
The problem with this report is the following: it does not deal with specific human rights violations, but lists political demands. It has a political agenda. It sheds more light on the rapporteur's political views than on the human rights situation in Europe. And that is precisely its weakness. We must change that, if we wish the report to be taken seriously around the world. There are some examples of this too.
The rapporteur takes a critical view of the demand for so-called 'zero immigration' . She condemns the fact that no Member State allows unrestricted immigration. And that is portrayed as a human rights violation! Mrs Roth, it is quite wrong to call this a human rights abuse. You are way out of step with the general political consensus.
Furthermore, the rapporteur rails against the application of the concept of a 'safe third country' with regard to the right of asylum. Clearly, this is a question open to dispute, but to portray it as a human rights violation is, if you will forgive me for saying so, entirely wrong.
I should like to propose a way out. I propose - and here I share the views of Mr Schulz - that we abandon the distinction between human rights in Europe and human rights in the rest of the world. If the concept is indivisible, it must apply in Europe in exactly the same way that it applies in China and Zaire. I therefore propose that we include in the report only human rights violations for which an action can be brought before the Court of Human Rights here in Strasbourg.
I would suggest that we consider entrusting this task to Parliament's Subcommittee on Human Rights. This dispute, which is inevitable if such a political agenda is put forward, is helping neither the cause of human rights nor Parliament.

Caccavale
Madam President, ladies and gentlemen, I too wish to compliment Mrs Roth on the careful, meticulous work that has gone into this report, most of which I too can agree with, although certain paragraphs are a little controversial, I have to say. Debate in the House has crystallized very much around what have been defined as the static and the dynamic concepts of human rights - and today is no exception.
I have no answer to that: I do not know which of these two notions is correct. What goes without saying is that we all have to come to terms with rapid change. The concept of human rights is changing because the rights themselves are changing, in particular so-called social rights. We cannot, of course, agree with many of the report's prescriptions - to coin a term - concerning social rights, and still less those concerning the right to social security: when the right to social security is taken to extremes and effective social and economic protection is demanded - including the right to a home, to good health, to a family, to beauty, to a wife, to make love, to do everything - well, that is obviously a way of devaluing the concept underlying this report. However, I do regard economic freedoms as fundamental, but for the opposite reasons to Mrs Roth: it is in fact because the welfare state is overloaded that cases of grinding poverty, exclusion and unemployment exist today.
Of course Europe must set an example, and Mrs Roth is quite right about that: prison cannot be regarded as a place for punishment or, even worse, torture, but is for rehabilitation; trials must be just, so there must be genuine equality between the prosecution and defence; there must always be respect for the rule of law, even when combating terrorism or the Mafia; citizens should not be encouraged to become informers; asylum-seekers must also have a fair trial, including those fleeing from war or famine who are seeking hospitality from us - obviously this does not mean opening the floodgates to immigration. On all these points we shall naturally be voting in favour of the Roth report; the Italian delegation will vote in favour of the report despite its doubts concerning many paragraphs, such as paragraph 18 on active euthanasia, which we do not understand, paragraph 26 on depriving sects of freedom of religion, where it is unclear what constitutes a sect, and paragraph 142 on the right - amongst others - of adoption for homosexuals.

Goerens
Madam President, could this report be too reckless, too daring? On sight of the amendments, this would seem to be the opinion of many of our colleagues. But human rights are not a static thing. Their definition is prone to change with time, with changes in mentality and in accordance with the conception one has of man and his dignity. That does not mean that it is okay to reduce the classic corpus of human rights: it retains all its value. Perhaps the time has come rather to complete it.
Our rapporteur invites us to do so explicitly by adopting the now classic distinction between human rights of the first generation and those of the second. She invites us to codify and guarantee a third generation of human rights.
Of course the objection can be made that in wanting to increase and extend human rights, there is a danger of stripping them of their impact and diluting the very strong symbolic and political significance which characterises them. This objection should be taken seriously, but the fact remains that thinking towards an extension of human rights is perfectly legitimate and undoubtedly necessary, if only because it makes us think about the destiny of our society and because it allows us to correct certain developments while there is still time.
This evolutive approach is also justified by the fact that the classic declarations and texts are also the result of an evolution which took place over several centuries before arriving at a legally binding codification. This is particularly true for legal matters of an international nature, where the time lapse between what had been accepted for a long time at home and a code of good conduct applicable to relations between States is particularly striking.
Of course, there is also this other mismatch between the solemn proclamation of great principles and the sociopolitical realities which, sadly, make human rights remain unheeded.
Mrs Roth has taken great pains to show us that everything is not for the better in the best of worlds, as far as the respecting of human rights and basic freedoms in the European Union is concerned. This rather damning report may shock some but, in this area, it is important to be particularly exacting and not to give way to the tendency to hide one's face or look away from unpleasant things. It is upsetting to note that, even where we live, reason of State can take precedence over the respect of principles which should be dear to us.

Pailler
Madam President, I am sorry that Mr Nassauer has left. What hypocrisy! A political conception of human rights? But when Mr Caccavale says that poverty is attributable to the Welfare State and to assistance, which constitute obstacles to economically useful business activity, is that not a political conception of human rights? As for the solid examples, you know very well as soon as the case of one country is cited you make an amendment to erase it. So, let's stop the hypocrisy!
Contrary to the claims of a large part of the right of the hemicycle, the State can attack liberties. Power can be abused by the State. Power often is abused by the State: inhumane treatment inflicted on detainees, calling into question of human rights in the army, etc.
This right wing has still not assimilated the fact that some rights are debts upon society, positive rights, like in France since 1848 for example; the economic, social, cultural and ecological rights are human rights.
As for me, I would like to focus my speech upon immigration, or rather on the way in which certain political forces - and unfortunately some governments - use immigration for internal political ends. In France, the Pasqua and Debré laws are concrete examples of this. On the European scale, many decisions place the whole body of immigrants under suspicion and attempt to destabilise their position. This legislation, whether adopted or under preparation, is an attack on fundamental human rights.
In Paris, as in Brussels and Strasbourg, we must refuse to occupy the ground chosen by Le Pen. We must stop making immigrants the scapegoats of the crisis, with all the racist and xenophobic drifts which this creates. To treat strangers with suspicion is to threaten the whole of European society.
Let us say it with force: the problem is not immigration, it is social crisis, unemployment due to the application of economic policies founded on competition with regard to wages, and on social exclusion. As for customs, there is in this case an inability to take developments into consideration, as well as the will of some to continue to discriminate against homosexuals and homosexual couples, which would endanger marriage and the family.
If only those who would not vote for this report would think about what Descartes said - and I will end with this quotation: ' I do not approve at all of the fact that one should try to deceive oneself by revelling in false imaginings. That is why, seeing that it is greater perfection to know the truth, even if it is to our disadvantage, than not to know it, I confess that it is better to be less joyous and more knowledgeable.'

Ullmann
Madam President, ladies and gentlemen, whenever the question of human rights in the European Union is on the agenda, national sensitivities suddenly begin to dominate again, and indeed under the banner of non-interference in countries' internal affairs, a concept which I remember well as a cornerstone of the human rights policy of the Communist countries. But the European Parliament is checked here by the European Convention on Human Rights - the only legal framework for any discussion of the protection or violation of human rights. It clearly was not created with this in mind!
A twofold error underlies this approach. Firstly, Article F(2) of the Treaty on European Union requires the Union to respect fundamental rights, not only as guaranteed by the European Convention for the Protection of Human Rights and Fundamental Freedoms, but also as they result from the constitutional traditions common to the Member States, in which the social and cultural basis of human rights is taken into account and amply developed - and certainly not always as restrictively, Mr Nassauer, as in the German Constitution.
Secondly, Parliament is not the European Court of Human Rights and is not conducting a trial, which can naturally only take place on legal grounds. This is a report which has to draw on the human rights concepts embodied in the relevant UN Declarations, the International Covenant on Economic, Social and Cultural Rights, the UN Convention on the Rights of the Child, and lastly the whole body of non-discrimination legislation of the European Union itself: everything, that is, which the Helsinki Final Act and the Charter of Paris refer to as the 'human dimension' . Indeed, this forms part of the Member States' common legal philosophy. How can it be neglected, therefore!
The purpose of this report is not to freeze human rights concepts and practices at their 1950 level, but to update them in accordance with the totally different circumstances of our times.
Since the Council has just given a lamentable example of the weakness of the European Union's human rights policy, it is now up to Parliament to rouse itself and demonstrate to the people of Europe and the world that a sufficient number of Europeans wish to rectify that weakness.

Vandemeulebroucke
Madam President, ladies and gentlemen, I welcome the fact that we are discussing the human rights situation in the European Union today. Mrs Roth is right to call for the abolition of every form of discrimination on the grounds of race, sex, sexual identity, religion, persuasion, age and disability, and to state that human rights are one and indivisible. I also think she is right to call for the concept of human rights to be extended to include such things as social, environmental and health rights. However, I feel that there is still one thing missing in her excellent report: the right to be able to live freely in one's own culture.
Linguistic diversity is part of the European Union's rich heritage, and communities must have the right to express themselves in their own culture and to do so with Europe's protection. The European Union has made considerable progress here. European funding is now provided to support the so-called minority languages and cultures, and it would have been a further step forward if all fifteen Member States had signed the European charter for regional and minority languages. These are fundamental human rights too, and I regret the fact that two Member States have been unable to sign. In my opinion, this is a really glaring shortcoming in our attempt to achieve unity through the recognition of diversity. Only when diversity is treated decently shall we be able to make progress towards a strong and genuine European Union.

Le Gallou
Madam President, from this side of the hemicycle, we are following with some amusement the division between right and left on the more or less extendable definition of human rights.
But we think that, before creating new rights, it is first necessary to make sure that the fundamental rights are respected, that is, firstly the right to freedom of expression, including for those who think differently from you, including for those who think differently from the dominant cultural or political power. Because, in truth, it is primarily for political minorities that liberties should be granted and defended.
Right to freedom of expression, right, also, to the freedom of association, including for opponents of power, including for people who meet up to say things which you do not like or which the dominant majority do not like.
Lastly, human rights also mean the right to electoral freedom and trade union freedom. And there is in France, from this point of view, much abuse where trade union freedom is concerned, since it is only possible for workers to stand for professional elections if they are members of unions which are duly approved and limited by law. It is not possible to create new unions, it is not possible to stand freely, in France, in trade union and professional elections and this is obviously a very serious attack upon human rights.
This attack has just be stregthened by the Perben law, which limits the liberties which still existed in the civil service in this area. This freedom is also limited by a number of court decisions taken by sleeping judges, on the orders of the authorities, which have finished up by prohibiting a number of national unions, in particular the Force national-transports en commun (TGWU), which aimed to enable the representation of free workers in the transport sector.
So, yes, human rights in Europe must be defended, but first we must defend the fundamental liberties: electoral freedom, trade union freedom, freedom of speech, freedom of expression, and freedom of association.

Lambraki
Madam President, I too would like to congratulate Mrs Roth on her excellent report. It confers a political and social dimension on the concept of human rights which sits well with developments in European thinking on the subject. We have moved forward a step or two from the concept of human rights developed at the time of the French Revolution.
One year ago I wrote a letter to the new Greek Minister of Defence, Mr Akis Tzohatzopoulos, informing him of the resolutions and concerns of the European Parliament on the question of conscientious objectors and requesting him to make better arrangements for such cases. I am glad to be able to tell the House today that a bill providing for an alternative form of national service which will, I believe, finally resolve an issue which has troubled the European Parliament and many of us, too, for so many years, has already been laid before the Greek parliament.
We have tabled an amendment with Mrs d'Ancona which will, I hope, with the assent of Mrs Roth, be accepted, because in Greece, which is the only Member State with no border with another Member State and in which military service is compulsory under the constitution, the issue is quite a contentious one. I hope that the arrangement that is being made will meet the requirements of the constitution - which makes national service compulsory for all - and make it possible for those who object to bearing arms to serve their country without compromising their principles.
On another point I wish to say that since the fall of the Greek junta in 1974, after the terrible experience of dictatorship, the Greek constitution has actually been very progressive. It does enshrine and guarantee the right of freedom of association and assembly for all citizens, including those belonging to minorities. The provision of paragraph 47 in Mrs Roth's report is probably the result of false information, because the Greek constitution does actually enshrine this right.

Pirker
Madam President, the human rights report now before the House continues the tradition of previous years. It is certainly not a report on respect for human rights in the European Union, as the title would have us believe, but once again - if we compare it with previous reports - an attempt by Socialists, Greens, leftists and liberals to present to Parliament and the public at large, under the guise of human rights issues, ideological positions which could not otherwise be discussed in such depth.
We in the Group of the European People's Party believe that human rights are simply too precious to be allowed to serve as an ideological battleground. We therefore recommend that Parliament should return to discussing actual violations of human rights, highlighting and condemning any such violations in the European Union and doing everything possible to ensure that they are not repeated.
Like previous reports, Mrs Roth's report discusses everything under the sun. It calls for the right to health, the right to social security and the right to a healthy environment. Clearly, these things must be discussed; but they must be discussed in the committees responsible, and not under the guise of a debate on human rights.
If everyone thinks they are obliged to say something on every subject, Parliament will run the risk of being branded a talking-shop by the public! I am in favour of things being discussed responsibly by the responsible bodies. We are running the risk of discrediting ourselves. When we read that Parliament is concerned at serious and inadmissible human rights violations, the existence of degrading detention conditions and the erosion of basic rights and fundamental freedoms, that it is deeply concerned at cases of torture, cruel, inhuman or degrading treatment, including cases of death, we could be forgiven for thinking that we were in Burundi or Zaire, and not the European Union. We must get back to the facts when discussing human rights, and we should not have to remind ourselves where we are.
We in the Group of the European People's Party would like to see Parliament get back to legally enforceable rights, discussing actual human rights abuses and calling for respect for human rights in cases where the path of human rights has been abandoned.

Andrews
Madam President, one would expect nothing less from somebody like Mrs Roth, whom I consider an extraordinary individual. Mrs Roth has produced a report which contains a number of paragraphs that some Members have reservations about. Nevertheless, I have to say that, overall, the weight of this report encourages me to vote in favour of it.
I would cite, for example, the references to the treatment of prisoners and the protection of children. Taking a position on euthanasia is not a responsibility of the European Parliament. The lack of concern about the victims of crime has, to a certain extent, been redressed by the amendments adopted in committee. But much more must be done for the victims of crime.
While I fully endorse giving priority to setting up units to provide palliative care for the terminally ill, so that they can die with dignity, I believe that the sensitive question of euthanasia is not one that should be dealt with by the European Parliament.
There is justifiable criticism in the report of the use of violence, inhuman, cruel or degrading treatment or punishment inflicted on persons on remand by the security forces or the forces of law and order. Those responsible for such abuses should not go unpunished. Belmarsh security unit in England, which I visited recently, is a virtual concrete tomb in which prisoners are incarcerated for long periods of time. Women imprisoned in jails anywhere in the Community must be treated properly and with dignity.
I wish to thank the Committee on Civil Liberties and Internal Affairs, and particularly its chairman, Hedy d'Ancona, for accepting my amendment calling for appropriate facilities to be provided for pregnant women in prisons. I welcome Mrs d'Ancona's proposed visit to Holloway Prison. The way in which Roisín McAliskey, an unconvicted prisoner and expectant mother, has been treated in Holloway Prison is outrageous. In March, the Guardian newspaper wrote that Miss McAliskey's case illustrated how prisoners awaiting extradition or deportation hearings could find themselves treated worse than those who had been convicted. The Guardian also reports that the German Government has promised Miss McAliskey that, if extradited, she would be able to take her child with her. I want to thank the German Government and the German Members of Parliament for their understanding of this particular case and for their support for my campaign for the proper treatment of prisoners in English jails.

Dybkjær
Madam President, I would like to give two examples to illustrate that the report is, in my view, unrepresentative and far too general.
1) Denmark is named several times, whereas other countries scarcely appear. I would not wish to conceal the situation in Denmark, but it is quite simply an inaccurate picture of Denmark with respect to the other countries in the Union. But perhaps this is because we do not have a representative on the committee and can therefore serve as a scapegoat. For example point 159 is completely wrong and point 33 misleading.
2) If the environment is to be included in these annual reports, then one should point out specific violations of the environment legislation, and not make do with general statements.
In conclusion, Madam President, I must say that the report does not fulfil its function and appears to be in appropriate. I would recommend that future reports be shorter, more precise and more accurate.

Ephremidis
Madam President, we intend to vote for Mrs Roth's report because of its comprehensiveness, sincerity, boldness and objectivity. In addition we shall support it because of the way in which certain sides of this House have spoken against it during the debate.
We shall support it, moreover, because it makes it abundantly clear that if the Community wishes to have credibility it must first of all ensure full respect for human rights within its own borders. That condition is not fulfilled in a Community in which several of the leading countries are plagued by racism and in which xenophobia culminated in the recent sinking in the Adriatic of a ship carrying women and children refugees from Albania.
We support it also because it makes specific mention of the fundamental right to work and to a proper standard of living - a right which is being denied to 25 million unemployed people in the Community, 50 million who are living on the verge of hunger and an equal number of homeless people.
Finally, we will be voting for it because it insists on absolute respect for nature and the environment. This, too, is lacking in the Community, because mad cow disease is the result of a violation of nature and the genetically modified maize that we debated here yesterday is also a violation. Likewise, the continued production of nuclear waste by leading Community countries for dumping in various regions of the Community and elsewhere is a violation of nature.
And, furthermore, Madam President, we will be voting for it because on certain points it is critical of Greek policy in this area and - even though one may have certain reservations in that regard - we consider such criticism to be very useful for my country.

Wolf
Madam President, ladies and gentlemen, let us take an inclusive political view of this matter, rather than a divisive legal one. It is a question of the equality of freedom of all people as living beings. We breathe the same air, we drink the same water - as Antiphon the Sophist said, who first expressed the idea of equality of freedom. The thinkers of the Enlightenment revived this concept, and it was never applied merely to abstract legal entities or property-owners, but to real, physical, historical, social living beings. In other words, the distinctions that are being made here are artificial. They were invented subsequently. We need to develop a human and civil rights policy like the one which Etienne Balibar has set out repeatedly in his most recent publications.
Let us all finally recognize the fact that human and civil rights policy represents a key element of Europe's heritage that is essential to building a Europe which seeks to make its own specific, positive and constructive contribution to the development of human civilization!

Hager
Madam President, a report calling for respect for human rights should really be quite straightforward. If only because of its scope, however, the report which is now before the House does not really lend itself to detailed discussion. While expressing a general criticism of the report's unclear definition of human rights and echoing some of the points which have already been made, I should therefore like to focus on a particular paragraph - paragraph 146, understandably enough - which attacks Austria's legislation on the age of consent for homosexual relations. Leaving aside considerations of international law, I see this as an unwarranted interference in Austria's jurisdiction. Perhaps we Austrians are rather sensitive to German proposals in this area.
Furthermore, this criticism is not justified by the facts. After long and controversial deliberations on the criminal law amendment bill of 1996, after organizing hearings of experts and taking all the arguments into account, the Austrian Parliament reached the conclusion that the protection of minors was of paramount importance.
In response to the claim in paragraph 54 that the failure to comply with the commitment to freedom of establishment has caused citizens to lose confidence in the European institutions, I would suggest to the House that the public's impression that those up in Brussels, as it is always called, simply wish to brush aside democratically established laws is leading to a far greater loss of confidence. That is the public's real concern. And it casts doubt on the professed commitment to subsidiarity.
I was a criminal judge for many years, and I am also the father of a fourteen-year-old boy. Speaking from both points of view, I wish to say that I firmly believe that the repeated claim that a homosexual orientation is genetically pre-programmed is not exclusively true. Anyone who has one in their family will know how easily influenced, how immature, young men of that age are. The report's call for tolerance for homosexuals is not called into question; but tolerance must include understanding for those who wish to protect their sons while they are growing up.

White
Madam President, I congratulate Mrs Roth on an excellent report and I am very sad that the right and the centre-right have taken the attitude which they seem to have taken a couple of years ago with the Newman report.
We on the progressive side of this House understand individual rights collectively acquired. Women would not have got the vote had there not been collective action with the Suffragette movement. Trade unions would never have been recognized had people not combined together to ensure their recognition. Therefore our experience is different from that of the right and that is why we consider that collective rights are as important as individual ones although we recognize and understand the latter in terms of this report.
Can I, although Mr Nassauer is not here, remind him that the title of this report is in fact human rights in the European Union not human rights in the entire world.
Having said that I believe that individual rights can be acquired collectively, can I point out the relevance of paragraphs 53-59 which concern the right to free movement for European Union citizens?
I believe that the Schengen agreement does not obviate the duty of Member States to comply with Article 7a of the Treaty, but it is being used in that way, and the fact that a number of states have concluded the Schengen agreement does not enhance the fundamental right of citizens to move freely within the European Union. This is greatly to be regretted since only a limited number of states have signed the Schengen Agreement and therefore the individual right of free movement is not guaranteed even collectively. That is the reason why I endorse paragraphs 53 to 59 and I say that free movement is a human right essential not only for the citizen but for the working of the European Union.

Moretti
Madam President, Europe wishes to place itself on a pedestal as an international guarantor of democracy around the world, but without having put its own house in order. Its statements and declarations, which undoubtedly have a basis in democracy, are going to waste, as are its criticisms, condemnations, reproaches, concerns, indignation, observations and comments, because of the sanctimonious exhortations which it never fails to utter when commenting on the major social tensions which are brought to our notice every day by the diligence of the press agencies.
Whenever social tension erupts in Europe - or elsewhere in the world - it is now customary to accuse the peoples of the EU of selfishness, and their great sacrifices, their tremendous commitment to their work, are never recognized. All too often, ordinary Union citizens have to shoulder the responsibilities of governments and wealthy capitalists. The rapporteur mentions a number of sacrosanct rights and principles which the Union cannot overlook, not least because it needs to claim the role of international guarantor of human rights in order to draw a veil over the real, anti-democratic Europe of big business. The report makes no reference to the Europe of workers and small businesses, whose rights are obstructed every day by infuriating laws. It does not refer to the right to self-determination of the peoples of the Union, nor to the daily injustices suffered by the inhabitants of Sardinia, Corsica, Padania, Ireland, Scotland and so many other peoples whose calls for freedom are systematically ignored and dismissed as selfish.

Malone
Mr President, my congratulations to Mrs Roth.
Many of us in this Parliament deal on a regular basis with human rights in the world. We talk about forced labour and child labour in various parts of Asia and we condemn them, quite rightly so.
Now today, while we concentrate our focus on human rights in Europe I would urge you to look at one section of our society in Europe for whom the situation is no better than anywhere else in the world: I am talking here about women. We, that is 50 % of us, do not have the right to walk the streets in safety. Furthermore, the existence of poverty and unemployment throughout the Union constitute continuing breaches of fundamental human rights.
Here I would urge support for the establishment of a binding legal instrument laying down minimum guarantees as regards income, social protection, medical treatment and housing, and particular attention must be devoted to the needs of elderly people. Finally, I want to endorse the call that is made in the report for Member States to recognize the rights and needs of the travelling community, in particular their accommodation needs, their medical needs and indeed their education needs. Until we recognize these particular rights we do not have the moral authority to criticize others elsewhere in the world.

van den Broek
Mr President, ladies and gentlemen, I was not surprised to hear Mr Dell'Alba ask, as a point of order at the beginning of this debate, to what extent the Commission should be involved in the discussions, given that it has no formal powers in the field of human rights in the Union. I quite understand why he made this point, but I am nevertheless grateful to have had the chance to listen to the various speeches, which have shown how incredibly complicated this issue is, and how difficult it is to reach a consensus on the human rights situation in the Union. It is especially difficult to define what human rights actually are, and to agree on whether certain things are simply desirable, or are really needed to correct abuses of the fundamental rights and freedoms set out in international conventions.
The Commission entirely understands that this is a very difficult distinction to make, but at the same time I would point out that when working with the Member States' governments on external policy matters, including the Union's external human rights policy, we in the Commission set great store by the fact that we can be part of an internal debate which is, as we see it, primarily designed to promote self-criticism and self-examination within the Union, so as to increase the credibility of our external human rights policy. It does sometimes happen in the international arena that we are accused of criticizing various countries for failing to respect human rights while the situation in our own countries still leaves a good deal to be desired. So I think that this kind of debate, which shows the world outside that we are prepared to take a critical look at ourselves within the Union, can have a very positive effect.
In view of the limited time available, I should like to give a few examples of what the Commission is doing to help to protect fundamental rights and freedoms within the Union. Take, for example, an extremely important topic which a number of speakers referred to this morning: equal treatment for men and women. This is a fundamental legal principle and also, in our view, an integral part of democratic citizenship, which is one of the reasons why the Commission has put forward a number of proposals on the subject in the report which it is currently preparing for the Intergovernmental Conference, including a recommendation that the principle of equal treatment should be included among the tasks of the Union. There is also a proposal to introduce a new non-discrimination article banning sex discrimination, since equality is a basic right. The Commission has also made a number of statements and recommendations about equal pay for work of equal value, and equal treatment in terms of work and occupation.
I would also mention the role which the Commission has played in combating racism and xenophobia. Was it not the Commission which proposed that 1997 should be declared the European Year Against Racism? We see this as a milestone for the European Union, in that it was the first time that the European institutions agreed to take practical measures to combat racism from within the Union's existing institutional framework. In our opinion, this sent out a very positive signal. Of course, the European Year Against Racism is only part of our overall strategy for combating racism, and real progress has been made on this since the Cannes summit. I am hopeful that a European Monitoring Centre for Racism and Xenophobia will be set up in the not too distant future.
Finally, the Commission has stated in its report for the Intergovernmental Conference that the Conference should include provisions in the Treaty banning any form of discrimination and condemning racism and xenophobia.
A further point is that the elements of social security that are specifically designed to prevent poverty and marginalization are naturally to remain the responsibility of the Member States. Since the 1970s, various initiatives have been launched to help to combat poverty and social exclusion.
Another important subject is the fight against the trade in humans, both adults and children, and the sexual exploitation of children. On 26 January 1997, the Council approved joint action to criminalize certain types of conduct and to improve judicial cooperation in this field. The types of conduct covered include the exploitation of children for the purpose of producing, selling, distributing or otherwise trading in or possessing illegal material.
In short, the protection and promotion of human rights and fundamental freedoms are indeed tasks which are primarily the responsibility of the Member States, but they are also tasks which affect the whole of the international community, and any measures taken will be all the more effective if all the members of the international community, every organization and every institution, including those of the Union, join forces to promote them.
I should like to end by thanking Mrs Roth for her report, and in particular for the tremendous efforts she has made to produce a report again this year, even if a consensus has yet to be reached on it. I hope that the foundations have once again been laid for a further constructive debate on this extremely important subject next year.

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

Monitoring Centre for Racism and Xenophobia
President
The next item is the report (A4-0110/97) by Mr Ford, on behalf of the Committee on Civil Liberties and Internal Affairs, on the proposal for a Council Regulation (COM(96)0615 - C4-0070/97-96/0298(CNS)) establishing a European Monitoring Centre for Racism and Xenophobia.

Ford
Mr President, I have just spoken to Mr Caccavale. The report is now available in all languages. However, I have tabled an amendment which is not yet available so I accept the ruling that we will vote tomorrow, even though that will cause me some difficulty.
I have been speaking for almost twelve years now on the subject of racism and fascism, xenophobia and antisemitism. I chaired a Committee of Inquiry from 1984 to 1986 on the growth of racism and fascism in Europe. I was rapporteur for a second Committee of Inquiry between 1989 and 1990 on Racism and Xenophobia. I have spoken in a multitude of urgency debates on issues ranging from the bombing of trains in Italy by right-wing terrorists through to the horrors of the desecration of the Jewish cemetery in Carpentras. In addition I participated in the annual debates on racism on a number of occasions.
However, today is a first. For the first time we are actually talking about a technical report from the Committee on Civil Liberties and Internal Affairs with an opinion from the Committee on Budgets about a solid proposal to address the issue of racism and xenophobia. This is a report on a proposal for a Council Regulation for the establishment of a European monitoring centre for racism and xenophobia. The origins of this proposal from the Council lie with the late François Mitterrand and Helmut Kohl who, at the Corfu Summit in June 1994, established a consultative committee including the representatives of fifteen Member States plus the Commission, the Council of Europe and Mr Oostlander and myself from Parliament, to look at the problems of tackling racism and xenophobia.
Over a series of four reports that outlined the need for such a centre, having been asked by the European Councils in Cannes and Madrid to do such work, the Council, following the report of the consultative committee, agreed in principle and asked for further elaboration. This was done and a full proposal was presented to the European Council in Florence. The study was approved and the consultative committee instructed to continue its work. At the Dublin European Council it was reiterated that the Council wanted to press ahead and to see the launch of such a centre at the Amsterdam European Council.
In the European Parliament, we are clearly completely in support of the principle of such a monitoring centre and have demonstrated that in a series of resolutions. However, we have a few reservations and observations. Firstly, the European Parliament would like to see not just a counting-house producing an annual, dull, desiccated report consisting of rows of numbers listing racial incidents or even racial attacks. What we want is an institution capable of drawing up and drawing together local, regional, national and international resources already available all around the European Union and outside, using especially the expertise of the Council of Europe which, very successfully, ran its 'all different, all equal' campaign last year. We want to draw those together to produce evidence of the best practical means of preventing and combating racism and xenophobia and producing lists of recommendations for local, regional and national governments and also for Parliament, Commission and Council.
That explains the amendments we have tabled - Nos 1 to 7. I would bring Amendment No 6(g) especially to your attention. This calls for the establishment and coordination of a European racism and xenophobia information network that draws together specialist centres at regional, national and international level to enable common criteria and comparable data to be established. I would also mention Amendment No 6(e), that the centre formulate conclusions and recommendations for the Community and its Member States primarily at the request of the European Parliament, the Council or the Commission. Amendment No 7 calls for information and data to be collected, in particular on preventative measures and means of action. There is also a new amendment tabled by Mr Oostlander asking us to look at the issue of religious freedom and racism, in particular related to the issue of Islamophobia.
Amendment No 14 requests that we have a representative on the management board from the European Parliament, not a Member but someone appointed on behalf of the European Parliament. Amendment No 17 deals with the issues of staffing. In our amendments we deal with two points. One, that the staff should be recruited with no discrimination on the basis of nationality, race, religion or colour. Clearly it would be absurd to have an antiracist observatory that discriminated in its staff recruitment.
But more importantly in one sense, we ask that the staff be recruited mainly on temporary fixed-term contracts or on secondment. We want this to be a clearing house, the centre of a network of expertise that is drawn from those people already involved. We want to avoid the problems of bureaucratic capture. Amendment No 18(c) mentions the possibility of outside sources of funding. Someone asked me where this is coming from. One might well look towards Switzerland where the Swiss Government has recently set up a fund to fight racism and to engage in research on the issues of racism, xenophobia and anti-semitism.
There are a number of other amendments from the Committee on Budgets. I agree with them and so does the Committee on Civil Liberties and Internal Affairs. Mr Tappin, draftsman of the opinion, will explain those in more detail. However, there is one technical point I should like to make. Amendment No 18, the last part of 4(c), should go to Amendment No 18, Article 13, new 1(a). This is quite important. It says that without prejudice to the provisions set out below, the principles and provisions governing the revenue and expenditure of the Community shall be applicable. That should apply across the board.
My last point is that 1997 is the Year against Racism. It was meant to be a beginning, not an end. It will be a severe disappointment to the 12 to 14 million third country nationals and the four million black Europeans if this was to be an end. There are proposals for Treaty changes to include racism but even if those are agreed in June, it will take several years for legislation to be established. The observatory is symbolic of progress.
One Member State has indicated that it has problems with Article 235 although the Drugs and Health and Safety Agencies were both set up on that basis. We believe that our amendments will allow the monitoring of racial harassment, the other problem that Member State has, and my own party believes there will be no fundamental problem in approving such an institution, should there be a change of government on 1 May in the United Kingdom. I look forward to Parliament adopting this report leading to the establishment of such an observatory at the European Council in Amsterdam in July.

Tappin
Mr President, Parliament has a long history of supporting the fight against racism. As colleagues will be aware, last year the Committee on Budgets supported the raising of the budget line to ECU 8m from the ECU 4.7m proposed by the Commission. Mr Ford has gone into great detail on the reasons why this agency should be set up. We fully support this in the Budget Committee. I will just address myself to a couple of points that Mr Ford has taken on board but really are to do with the Commission itself.
As regards the budgetary aspects of this agency, our concerns remain the same as they are with other agencies. Amendments have been put forward to ensure that it operates according to harmonized regulations including the right of Parliament to give discharge. We are not prepared, from the Budget Committee or from a Parliament perspective, to have the management board giving discharge. I wish the Commission would accept this argument without our having to go through this same process every time.
We also seek greater involvement on the part of Parliament and have asked for a representative, nominated by Parliament, to sit on the management committee. That has now been agreed by the Committee on Civil Liberties and Internal Affairs.
The next question is the question of own resources. We argue that the agency should be set up in line with Article 142 of the Financial Regulation and that own resources should be treated as Community resources and shown as such within the budget itself. However, as Mr Ford has indicated, there may be additional, ad hoc resources available to this agency. All that we ask is that the staffing arrangements and work programme for those additional resources are funded and kept separate from the budget lines.
As far as the future is concerned, when the organization comes on line, we would like to see our budget line B34114 reduced in a concomitant way. But the Budget Committee supports the establishment of this agency within the general lines and regulations we have set out for all other agencies. We support Mr Ford in his proposals.

d'Ancona
Mr President, the arrival in the House of right-wing extremists in 1984 marked the start of a series of activities designed to combat racism and xenophobia. With the Commission and the Council, we have covered this extremely important aspect of European integration - the prevention of another Holocaust and the right to equal treatment of anyone lawfully resident in the territory of the Union - in resolutions, annual debates and the work of the important advisory committee set up under Mr Kahn.
My group sincerely hopes that this year, in which the IGC reaches its conclusion, will also see the implementation of three of the Commission's recommendations. Firstly, the inclusion of an article on non-discrimination in the Treaty of Amsterdam; secondly, a code of conduct for political parties to prevent normally reputable parties from peddling extreme right-wing views for electoral reasons; and, thirdly, a Monitoring Centre for Racism, which is the subject of this morning's debate.
We also hope that the Major government will abandon its opposition to the Monitoring Centre, because its argument that there is no legal basis for it is both weak and irresponsible. With a little creativity, we could find other articles as well as Article 235 to use as a legal basis, such as Article 6, which prohibits discrimination on the grounds of nationality, or Article 49 on the free movement of workers, Article 160 on education and, in particular, Article 213 on carrying out checks. A combination of Articles 213 and 235 would mean that we could make the earliest possible start and send out a very important signal, because we must do everything we can to make it clear that we take our fight against racism, anti-Semitism and xenophobia very seriously.

Oostlander
Mr President, the setting-up of the Monitoring Centre is really the crowning glory for the Kahn Committee on racism and xenophobia, which has done its best to include the input from the European Parliament in its final proposals. The rapporteur, Mr Ford, and I have tried to ensure that the House's ideas were reflected, and I think it was a good thing that we tried to include as many of the initiatives put forward in the Kahn Committee as possible, and to refer to some of the European Union's existing projects and programmes, of which there are many in the social affairs, education and cultural sectors. It is perfectly possible to include racism and xenophobia as part of these, as we have already done with the subject of equal treatment for men and women, which is now automatically taken into account in programmes intended to benefit the people of Europe.
Combating racism and xenophobia is not something that can be done in isolation, but must form part of an integrated approach. There were a good many points in the Commission's proposal to which our committee - and indeed my group - objected, but we worked hard in the Committee on Civil Liberties with the rapporteur and Members from various other parties, and managed to produce an excellent result without any polarization. I do not believe in polarization, to hark back to the previous debate. What struck us as strange was that the Commission proposed an EU organization with the independent nature of an NGO. This is clearly a feature of what we refer to as agencies, and it may therefore be that the idea of an agency is not such a good one, since it will mean that there is, by definition, little parliamentary control. We should like the Commission to have a great deal more responsibility and to have political control over what happens to the Monitoring Centre, and we have tabled amendments to this effect. We should also like the Monitoring Centre to give priority to questions from Parliament and the Commission. We need to be able to monitor the budget, rather than just rubber-stamping whatever the Management Board puts in front of us, and the Committee on Budgets has our support on that point. It is in fact unfortunate that the Management Board is organized as if it were a government consultation body. This undermines the independence of the Centre itself, and we are doing everything we can to have that changed.
We would emphasize that the Centre should be there to serve the research institutes. It has an enormous budget of ECU 6 million, which has already worried some organizations, such as United. We think that six million is actually about right, but it must be put to maximum effect, and should therefore be used to help to encourage and promote research in existing research institutes. We should aim to secure the greatest possible benefit from it, especially given the importance of fighting racism. This is why we have proposed that the Centre should employ people from the network on secondment or on temporary contracts, so that there is a constant flow of ideas in both directions.
Coordination, harmonization and promotion will be the main functions of the Monitoring Centre, and we hope that it is very successful in helping to combat racism and xenophobia.

Caccavale
Mr President, all instances of racism and xenophobia, both old and new, are utterly contemptible, as we all agree. But I believe that it is wrong - as has happened once again this morning - to point the finger at one part of the political spectrum, in this case the extreme right, not so much because the extreme right does not sometimes show its racist and xenophobic colours, but because I believe that this way of focusing the debate will encourage, not prevent, racism and xenophobia: the more the finger is pointed at them, the more this phenomenon will flourish underground.
I do believe that the idea of the observatory is justified in theory, but in practice it still strikes me as somewhat vague. The reason I say so is that it unfortunately remains a dialectical exercise - which will cost the European taxpayer between ECU 6 and 7 million, I would point out - the aims of which have been clearly set out in the report by Mr Ford, whom we would compliment on his work: research, ad hoc working groups, annual reports, conclusions and recommendations, meetings of experts, debates, round tables, other similar meetings, and so on and so forth. In short, it all seems to me to be a theoretical exercise which may well often prove pointless. In my view, the root cause of racism and xenophobia is ignorance, and above all a lack of mutual understanding which generates suspicion and mistrust. Practical ways must therefore be found of exchanging knowledge and information, especially among young people: that is the most effective way of combating racism and xenophobia.

Pradier
Mr President, I am sorry to bring a discordant voice to what will probably be a great harmony, but I think that what we are working towards is the inflation of some structures. In short, this observatory seems to me to be superfluous. When you know the quality of the initiative of the Council of Europe, of which we here are the hosts, and which does a considerable body of work which has been kept under a wraps when it should have been the concern of our entire continent, all of these elements seem rather puzzling to us.
Indeed the kind of institution chosen, a monitoring centre, is part of a movement which consists of accumulating structures likely to do the same work twice over. Next, it encourages the relaxation of policy and more precisely of political action, in favour of an observational role, which illustrates well the rather slack consensus with which our Parliament is happy to be quite familiar. Finally, it presents itself as an alternative to civil action which is being increased in the territory of the Union by various associations and which seems to me to be much more important.

Vanhecke
Mr President, this is the umpteenth report on racism or the fight against racism which Mr Ford has thrust under our noses, this time about the setting-up of a European Monitoring Centre for Racism. This new toy is going to cost the European taxpayer around ECU 6 to 7 million a year, on top of the ECU 8 m we have already wasted this year on the European Year Against Racism. On the pretext of fighting racism - which may exist as a marginal phenomenon, but has not reached sociologically or politically relevant proportions in any Member State - the taxpayer is having to foot the bill for a centre which is merely designed to gag freedom of expression, along the lines of those that exist already in various Member States.
In my own country, for example, there is already one of these 'propaganda units' led by a man called Pater Leman, who has quickly earned the nickname of Grand Inquisitor Torquemada. What it is really about, of course, is not combating racism, which is scarcely of any relevance anyway, but combating freedom of expression and any policy or expression of national or European preference.
Whenever I read the reports by Mr Ford, I am transported to a different age, back to the stifling totalitarian and intolerant atmosphere of the Spanish Inquisition, the book-burnings in Nazi Germany or the Moscow trials. This may sound exaggerated, but having seen violent demonstrations just last week here in Strasbourg outside a conference organized by a party which won 26 % of the votes in the region, demonstrations that were welcomed and funded by both the State and Europe, I really do not think it is such an exaggeration after all.
Every day, ordinary people in the Member States have to face the true misery of life in so-called multicultural neighbourhoods, terrorized by violent gangs of foreigners like those who totally destroyed the 'Café Local' in Amsterdam last weekend. Almost every major city in Europe has a time bomb ticking away, a time bomb of displaced and impoverished people who are presented to us as the 'multicultural society' . The House would do better to draw up a report on that instead.

Terrón i Cusí
Mr President, in this European Year against Racism, Xenophobia and Anti-Semitism I believe it would be extremely positive if we could get beyond declarations and create a permanent centre working for those three objectives. Many people are working on these issues in society, and especially in local and regional government which have prime responsibility for problems of arrival and abode - and I mention arrival because that is what is happening in my country - relating to people from third countries.
It is most important for this observatory to provide networking and information exchange facilities, and assistance to those already active in the field. I do not think the ECU 6 million we are going to devote to it will be much of a burden on the Union budget and if it can also serve the purposes of coordination and raise the alert about racist phenomena, that may even save money and rationalize the use of resources.
That seems to me to be the meaning of the text the rapporteur has put before us and that is why I think it should be supported. So I only hope the pitfalls in the Council will disappear and the observatory will be created during this European Year against Racism and Xenophobia, in line with the objectives we are expressing here today.

van Bladel
Mr President, the Monitoring Centre is a theoretical instrument for combating racism, but in my view, practical measures are still the most effective ones, such as fighting unemployment, crime and the drugs trade; establishing a clear and - eventually, I hope - a Community approach to asylum and immigration policy; and, in particular, promoting education to prevent racism. I am still not convinced that the Centre is going to be more than just the sum of all the small organizations that are already working to combat racism, and I hope the Commission can give me some kind of assurance on this point. I certainly do not want to see it turn into just yet another gravy train. We must not allow this to happen, because we have already seen racism lead to genocide here in our own continent.
The fact is that there is a covert form of racism and discrimination at work in Europe against Islam. People clearly seem to find it hard to distinguish between Islam and Islamic fundamentalism, and this is precisely what we need to guard against. Perhaps the Monitoring Centre has a role to play here. Racism is a complicated issue which causes a great deal of confusion. Turkey, for example, regards our attitude in relations with it as covert racism, whereas it is actually the logical consequence of the Universal Declaration of Human Rights. I was in Geneva last week, and I found out that the UN Commission on Human Rights is still treating the joint opinions delivered by the European Parliament as intergovernmental statements. If this is what the prospects are for the Monitoring Centre, then we are unlikely to make any progress at all.
Finally, I would point out that an absolute majority will be required in Parliament for the discharge of the budget of the Monitoring Centre.

Zimmermann
Mr President, earlier this morning, we discussed human rights in the European Union and the various kinds of human rights violation. For some Members, that went too far; for others, not far enough. The report by Mr Ford which is now before the House deals with racism and xenophobia, and I ask myself whether this kind of human rights violation is the cause of lack of respect for people, or the effect of it.
In today's society, which is built on a sense of community and tolerance, racism and xenophobia are not marginal phenomena, but are regrettably on the increase. Society frequently tolerates right-wing, xenophobic slogans without questioning their consequences. At a time when social security is being undermined by unemployment, poverty and organized crime, these problems are not being blamed on inadequate economic management or government mistakes, but on the immediate environment, which is more tangible and more accessible.
People in our society are no longer viewed as a whole. Some people are allowed to be here because of their nationality; and others, whom we call foreigners, are allowed to stay because they have lived here for a long time. But there are others who have no right of residence, and whom we should like to see removed from our territory as soon as possible. There are many other kinds of unequal treatment. For example, there are people who have work, and there are people who are not given the opportunity to work, because there is no work for them. But people with different religious beliefs, the elderly, the disabled, and so on are also frequently the victims of discrimination.
1997 is the European Year against Racism, and establishing the European Monitoring Centre for Racism and Xenophobia this year would not only be symbolic, but would represent a natural addition to existing efforts.
The task of this Centre will not only be to collect and process data, but above all to inform, instruct and raise people's awareness of the causes and effects of these phenomena. History has taught us that racism and xenophobia destroy people and cause enormous suffering.

Flynn
Mr President, on behalf of the Commission, I wish to congratulate Mr Ford and the Committee on Civil Liberties and Internal Affairs on the excellent work they have done, and particularly on the rapidity with which they have dealt with this particular proposal.
I hardly need stress that the Commission and Parliament are completely united in their struggle against the ugly phenomenon of racism and xenophobia and that, on this particular proposal, there are no fundamental differences between us.
It is very appropriate that this matter is being debated here in Strasbourg where, in their demonstrations just two weeks ago, the people showed the repugnance they feel towards this phenomenon. The setting-up of this observatory underlines the commitment of the Community to defending human rights and, more particularly, to respecting human rights in its legislation and policies. In order to do this the Community and the Member States must have at their disposal accurate and objective information concerning all the problems associated with racism and xenophobia.
With regard to the specific amendments which are proposed in the report, I am pleased to say that I can accept Amendments Nos 1, 2, 4, 9, 10, 15, 16 and 19 in full and Amendments Nos 6 and 14 in part.
Those amendments which the Commission cannot accept fall broadly into two groups: the first group are those which change the nature of the Centre or go beyond the original scope of the proposal, and the second group are those which change standard formulae or raise matters of a general interinstitutional nature which would be better dealt with in a different, more general context. In this respect, I refer in particular to Amendments Nos 13, 18, 20 and 21 which concern budgetary matters.
Let me now look in detail at the amendments. These are the ones I cannot accept: Amendment No 3 misrepresents the role of the Centre when it speaks of it being 'given over to research' . Amendment No 5 gives a misleading impression since it overlooks the fact that the Centre will be independent from the Commission. Amendment No 7 would extend the field of action set out in Article 3 to areas which do not have a specific basis in the Treaty and would, therefore, hinder adoption of the proposal in the Council, where some Member States already have concerns, as has been stated by Mr Ford, about the legal base. Amendment No 8 cannot be accepted since it is unnecessary: the wording proposed by the Commission is a perfectly standard and adequate formula and the conferring of legal personality is not restricted to application of the Financial Regulation. Amendment No 11 is unnecessarily restrictive of the Management Board's autonomy. Amendment No 12 is, in the Commission's view, unnecessary.
Amendments Nos 13, 18, 20 and 21 concern budgetary matters and, as I have said, raise broader institutional questions. Here the Commission's original proposal very closely mirrors the texts establishing the other agencies and it would therefore be inappropriate to diverge from these texts in this particular case.
Finally, Amendment No 17, relating to recruitment of staff, is not acceptable. The formulation used in the proposal is perfectly standard and it is not appropriate to change it at this time.
I reiterate again that any differences between us are really minor compared to the large measure of agreement which exists as regards the basic aim of the Centre.
Finally, I wish to thank you once again for the speed with which you have dealt with this particular proposal. I trust that the Commission's proposal can now go forward for rapid adoption by the Council, amended, as of course it will be, following Parliament's opinion.

Ford
Mr President, I should like to thank the Commissioner for all the work he has done with regard to the centre. In general I welcome the statement he has made with respect to Parliament's opinion. The only point I would ask him to look at again on behalf of the Commission is Amendment No 17. I understand the necessity, normally, for following formal rules but, as I said in my introduction, it would be rather absurd for us to discriminate against people legally resident in the European Union who did not have the nationality of one of the Member States in recruiting staff for an organization fighting racism. I realize this would not be standard practice but this is not a standard institution. So I would ask him to look at this point again.
Lastly, in reply to Mr Vanhecke's point about book burning. They may not be burning them in Orange but they are certainly taking them out of the libraries!

Flynn
Mr President, I have some sympathy there with Mr Ford. I recognize the point he is making. If he could try to see it from my perspective, we are trying to put it into the context of the existing system that operates so far as staff recruitment is concerned. He has made a point and I will consider it. But he should understand that a certain system already exists and is applied right across the board, and that this would be a change that might not be possible at this time.

Oostlander
Mr President, I would like to ask the Commissioner under what circumstances a standard procedure might be changed. We cannot simply say that once such a procedure exists, it may not be departed from at any time or in any way. Surely, given the particular nature of this report and the need to make the Centre as effective as possible, we should also be allowed to change the procedure?

Flynn
I appreciate the point Mr Oostlander is making. But you must also try to appreciate that any change would have to go right across the board.
I am prepared to discuss this with Mr Liikanen, my colleague, who is responsible for questions of personnel. It would not be appropriate I believe to just simply make a change regarding this particular agency without concerning ourselves with its general application right across all of the Union's operations. I do however take your point.

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

Growth, employment and convergence
President
The next item is the report (A4-0111/97) by Mrs Randzio-Plath, on behalf of the Committee on Economic and Monetary Affairs and Industrial Policy, on the Commission's Annual Economic Report for 1997 - Growth, employment and convergence on the road to EMU (COM(97)0027 - C4-0078/97).

Randzio-Plath
Mr President, ladies and gentlemen, economic growth in the European Union is like the current season: spring has arrived, but it is still cold. Despite the excellent starting conditions, business activity is sluggish and not taking off. The horse has been led to water, but it will not drink. However, the annual economic report does not reflect this everyday reality in the European Union. Its tone is too bright and too optimistic, despite the greater realism it shows in comparison with last year, and despite the new attitude to the impact of globalization and technological progress and the role of monetary policy.
Unfortunately, the confidence of economic operators in European growth - and this must be emphasized - remains low. Only lack of confidence can explain the fact that, despite high company profits, lower interest rates and reduced company taxes, investment has failed to materialize, especially in the private sector. And it is not encouraging that the rate of public investment has also fallen, from 3.5 % to less than 2.5 % of GDP.
I would point to the absence - and this is a weakness of European economic policy as a whole - of clear objectives and sound and reliable decisions in European economic and financial policy.
The Member States have been working with the so-called broad guidelines of economic policy for over two years, without managing to develop concerted and coordinated economic policies. This is another explanation for the weakness of European growth.
The Member States are still much too far away from coordinating their modernization and innovation initiatives. The Union will continue to lose competitiveness and jobs if energies are not focused in this area, and if the Community instruments for financing this process of modernization, this innovation revolution, are not finally mobilized. We must promote a spirit of innovation, strong investment and employment in the European Union. This requires greater action at Community level. Then the annual economic report will certainly also show some different results.
Hopefully, the upturn is now gathering pace and unemployment will finally be reduced. Also important, however, is a different policy approach, which makes it clear that employment policy has to be integrated into virtually all other policies - from structural, regional, innovation and industrial policies to economic, financial and wage policy.
Supply-side conditions in the European Union can certainly be improved - from the easing of cumbersome authorization procedures to the urgently needed reduction of taxation on the labour factor. It is more important, however, to overcome the weakness of investment, to stimulate domestic demand within the European Union and to boost consumer purchasing power.
We know that anti-cyclical programmes carried out at national level have little effect. Given that up to two thirds of aggregate demand in Europe comes from outside, demand stimuli that are applied only at regional or national level will obviously peter out. Hence the need to formulate a European economic policy worthy of the name. With the introduction of a single currency for a single market covering 90 % of EU production, it will clearly be possible to pursue effective demand management.
The lack of confidence of economic operators is an obstacle to growth and investment. Ultimately, it is not only private investors who are holding back. It also has to be said that the investment that is being made is aimed at improving productivity rather than expanding capacity, and is therefore not creating jobs. The annual economic report fails to highlight this weakness.
It is absolutely scandalous that, although an employment chapter is being drawn up at the Intergovernmental Conference, the European employment pact is still far from being realized. Parliament sees this annual economic report as a unique opportunity to promote the implementation of the decisions of the European summits from Essen to Dublin, not least as regards the employment pact.
Economic development in the European Union requires the following policy approach. First, it must be made clear once and for all that monetary union will be introduced. The constant creation of uncertainty by the political élites among the public and the markets is counterproductive for investment. Europe's civil war over monetary union is an obstacle to increasing the EU's economic power.
Secondly, the Community must have an appropriate and balanced policy mix, since it is increasingly difficult to pursue exclusively national policies successfully within the world economy. There is a need for financial policies which bolster rather than undermine the fragile economic structures.
Thirdly, budget consolidation must continue, but it must be organized and implemented in the medium term in such a way as to ensure that it does not cause additional macroeconomic problems, but makes it possible to continue to pursue sound investment policies. The implementation of the Delors White Paper has so far foundered, though not because of Parliament's decisions.
Parliament has therefore rightly continued to point to the need to mobilize the Community financial instruments. Why should ECU 10 billion a year not be innovatively employed in EU infrastructure modernization programmes, via the European Investment Bank? It is high time for this to happen.
Since the entry into force of the Maastricht Treaty, the European Parliament has regarded the broad guidelines of economic policy as a means to implement the provisions of Article 103 and overcome the difficulties of economic and monetary union. To date, no Council presidency has been able to contribute to surmounting those difficulties, because the Member States have always agreed on the lowest common political denominator. Perhaps this critical analysis of the annual economic report will help to bring about concerted political action and ensure that a market economy underpinned by a socially responsible economic order and job-creating growth finally sees the light of day in the European Union. Without the productivity factor that is the welfare state, there can be no stable economy, and the European Union is therefore faced with a creative mission, which it must acknowledge.

Hernández Mollar
Mr President, the European Commission's Annual Economic Report for 1997 comes at a crucial time in the process of integration that has been taking place on the continent since the signing of the Treaty of Rome, and we have just celebrated its fortieth anniversary.
The signatories of that historic treaty could surely never have imagined that 40 years later the problem of unemployment would be the most serious threat to their project for achieving a united, prosperous and mutually supportive Europe.
Everything the Community institutions are currently doing is dominated by the prospect of economic and monetary union. This new step in the deepening of integration will undoubtedly have positive consequences for resolving the unemployment problem.
So I think this Parliament has a responsibility to collaborate as effectively as possible to achieve monetary union of as many countries as possible under the terms of the treaty. The Commission's report is essentially positive, because it highlights the effort being made by the Member States to keep that historic appointment. For instance, my own country, Spain, which has the highest rate of unemployment in the European Union, hopes to demonstrate that only by adopting strict economic measures - aided by the exemplary social agreement on reform of the labour market which is reaching its culmination - can we be optimistic and confident of a hopeful future for jobseekers.
There are certain points in the report approved by the Committee on Economic Affairs which my group finds hard to support, but I want to thank Mrs Randzio-Plath for her willingness to incorporate some of our committee's conclusions into her report. However, given that I am speaking as draftsman of the opinion of the Committee on Social Affairs, my task is to analyse the report from the unemployment angle.
Investment in infrastructure, coordination between the various departments responsible for unemployment problems, the creation of mechanisms of financial assistance to small and medium-sized businesses, the elimination of administrative and bureaucratic burdens, the exploitation of new sources of employment in sectors like environment, leisure, culture and the third age, the incorporation into the treaty of a new chapter on employment, with a greater involvement of Parliament in the planning and development of employment policy, and the new formulae to combat unemployment proposed in the Commission's report represent many opportunities for action, so we should not resign ourselves.
But we must act with the urgency that the problem demands. The Commission's Annual Economic Report is a good document on the whole and should help us, all of us who have any responsibility, try to change the scenario it depicts of weak job creation over the next few years.
European integration has achieved the longest period of peace between the countries concerned, but it runs the risk of being held liable for unemployment if we do not succeed in defeating this problem together.

Donnelly
Mr President, on behalf of my group I would like to thank Mrs Randzio-Plath for an excellent report and we certainly will be supporting her report when we vote on it today.
I want to address my points to the European Commission, because we have to look at the annual economic report and ask ourselves why it commands such little attention in the press and the media, and in the debate that goes on within the European Union, if you compare it to the OECD report. That report is reported much more widely in the financial press and is debated in the Member States.
There are three reasons why the annual economic report of the European Union seems to have such a low profile. Firstly it deals largely with the issue of fiscal and monetary policy. It is too narrow in scope. It does not deal with the broad structural policies which balance fiscal and monetary policy. It does not deal in detail with issues related to investment, research and development, training and education. What we would like to see from the Commission in next year's annual report is a proper balance between these issues. We need to see all of the economic activities of the European Union analyzed more comprehensively.
Secondly, Commissioner, on growth and employment; we all know, and have debated many times in this House and within our committee, that we have inadequate growth in the European Union and excessive levels of unemployment. Yet your report largely concentrates on the issues of inflation and interest rate policy which of course are important but in themselves are not the only issues of concern.
What about investment levels? I know from talking to your own economists in DG II that they are very concerned about the inadequate levels of investment within the European Union. We have an investment rate of only 19 % of GDP in Europe today. We need an investment rate of 25 % if we are going to boost the growth potential and growth opportunity of the European Union so that we can create jobs. We need to say more in the future about this issue.
Of course the third reason why this report is largely disregarded by the people who debate economic policy in Europe is that it is seen as subjective; it is not seen as objective. It is seen as largely a theoretical exercise that is now conducted by the European Commission.
We must recognize that this is the E in EMU, it is the economic aspect of EMU and unless we can give the economic aspects of EMU real resonance in the European Union people will believe it is a monetary union only.
That is why I would like to propose to you, Commissioner, that for the 1998 report we should have proper consultation with all the economic players within the European Union and that your own economists should speak to independent experts as they do in Germany and the United States and the OECD. By doing that we will get a proper debate in the European Union on economic policy instead of the rather sterile debate we have today.

von Wogau
Mr President, ladies and gentlemen, for Parliament, the annual economic report represents an important basis for the discussion of the employment situation that will continue over the course of the year.
In the debate in the Committee on Economic and Monetary Affairs, we were able to see that the realistic optimism which characterizes this report is shared by the majority of members of the committee. This realistic optimism was also apparent at the Council's deliberations in Noordwijk, where, firstly, the timetable for the introduction of monetary union was confirmed; secondly, the relationship between the countries which take part in EMU from the outset and those which join later was clarified in an agreement on the European Monetary System, and its continuation in a modified form; and, thirdly, agreement was reached on the stability pact. As chairman of Parliament's Committee on Economic and Monetary Affairs and Industrial Policy, however, I wish to stress that the discussion of the stability pact has not finished, that Parliament will be holding a second reading on this subject, and that we are expecting Parliament's views - and we shall do our best to conclude our debate by the middle of this year - to be taken into account in the final deliberations.
Now to the problems. We can see that export trends are positive, but that, as the rapporteur has said, domestic demand still leaves a good deal to be desired. We note that investment is weak, even though the basic conditions for the economy are extremely positive, and that it is essential to boost confidence. In discussions with economists and investors, I repeatedly observe that confidence in the prospect of clear economic growth is still lacking in many EU countries. Then there is the totally unsatisfactory employment situation. We are convinced that unemployment is a structural problem, and that the forecast growth rate of 2.3 % will not be adequate to resolve it.
Let me comment on some of the important points raised in this debate. Firstly, there is the question of having to economize because of Maastricht. It is widely said that the Maastricht Treaty and monetary union require us to economize. It must be said, however, that we would have to economize with or without the Maastricht Treaty and monetary union, because total debt in the European Community is far too high and interest charges account for 20 to 30 % of our budgets, on average. This makes it clear that we are losing our room for manoeuvre and our competitiveness, and that we must continue down the road of budget consolidation.
A second issue addressed in Mrs Randzio-Plath's report is that of the leeway in assessing budget deficits and government debt. This is a question that will undoubtedly occupy us in the coming months, and we do need clarification in this context.
I would point out that a number of preliminary decisions have already been taken which indicate that the leeway for assessment will be used responsibly. For instance, the Maastricht Treaty provides that the decision on which Member States participate in the first wave of EMU on 1 January 1999 may be taken on the basis of either estimates or hard figures. We have now learnt that it has since been decided that this decision will be taken on the basis of hard figures. A number of other decisions on these lines have also been taken, and I presume that on 23 April, when the Commission presents its assessment of the figures for 1996, Parliament will have the opportunity - in the debate which I assume will take place before the press conference - to request further clarification on this matter.

Garosci
Mr President, our regular examination of the economic report looks at how the European Union is preparing for the landmark events in its future. It is our duty every year, when discussing it, to stop and reflect on what has been done over the past twelve months to create genuine economic cohesion among the Member States. If this issue were to be tackled properly, we would in fact see improvements in the Community in terms of the three main areas covered in the report: growth, convergence towards monetary union and unemployment. However, the citizens of Europe, and in particular industrialists - large and small - still cannot see any significant, practical results in these three areas, which are so crucial to the economic future of Europe.
The most glaring example of the Community institutions' unsuccessful efforts is their inability to solve the problem of unemployment, which is still the greatest of all those confronting the individual Member States and the Union as a whole. And if we fail on the economic front, those failings are bound to have repercussions in the social sector. Excuses can be found if we are incapable of forming a European military corps to help solve the conflicts in former Yugoslavia, but there can be no justification for neglecting to help businesses stay competitive in the market, to grow, develop and hence create new jobs.
The Committee on Economic and Monetary Affairs has tabled a resolution which, while on the one hand commending the Commission's work, calls on the other for direct, immediate action to revitalize the labour market. The solution lies principally with small and medium-sized enterprises. Helping them grow also means making their job more straightforward and less bureaucratic, relieving them of excessive taxation and improving the image of business people so that they will serve as an example and stimulus to young people, who may otherwise be attracted by easier options leading inevitably to unemployment.
Finally, there is one instrument which is both a means and an end when it comes to a successful Community-wide economy: the single currency. Thanks to the euro, the citizens of Europe will discover, as consumers, that they are living in a large internal market where they can purchase, study and travel in fifteen different countries with just one currency. Thanks to the euro, industrialists - especially in small and medium-sized firms - will be able to offer their products or services to a market of 370 million consumers. And finally, once the obvious teething troubles have been overcome, the euro will be what compels all the Community institutions and the Member States to think in European terms.

Gasòliba i Böhm
Mr President, ladies and gentlemen, analysis of the Annual Report for 1997 presented by the European Commission is particularly interesting in a key year for achieving the two objectives of economic and monetary union and the euro.
In the process of economic convergence the economies of the European Union are developing extremely well in terms of inflation rates, interest rates and monetary stability. The difficulties lie in attaining the targets for reducing debt and public deficits, because, in addition to essential budgetary austerity, it is crucial to meet the forecasts for economic growth, which are the most important indicators - in my view - at this time.
We share the concern expressed in the report on the need to pay special attention to the most serious social problem in the European Union: unemployment. The high rate of unemployment is significantly limiting the Union's options, and that means we must concentrate on overcoming the grave deficiencies and inflexibilities which are having a negative affect on the productive structure of the European Union. As Mrs Randzio-Plath says in her report, this requires further liberalization of key sectors, more intense application of research and development programmes, deepening of the European internal market and implementation of the Delors White Paper proposals - which are unfortunately blocked by the Council.
I just want to stress that we stand more firmly by our position on the achievement of the European single market and the elimination of inflexibility, than on certain rather interventionist aspects of Mrs Randzio-Plath's report, so we will support the amendments that accord with our position and give our overall support to the report on the Annual Economic Report for 1997.

Ribeiro
It is a pleasure to begin by heartily agreeing with my colleague, Mrs Randzio-Plath who reiterated and stressed the concern about over-optimistic ideas becoming the officially accepted norm.
In our opinion this optimism reflects an intention and an attempt to create a climate conducive to an economic policy strategy which are in no way worthy of the holy water contained in today's analyses, and similarly cannot, if they are followed, bear out the optimistic tone of the forecasts for the future. We are aware that confidence is needed to enable the forecasts, as a factor in economic trends, to help to improve the short and medium-term situation, but we do not accept that this strategy and these policies should still be pursued on the basis of a misrepresentation of the facts.
We also note, on the other hand that the report before us clearly lacks an all-round approach taking appropriate account of the essential link between supply and demand, the role of public investment and the effect of keeping too tight a rein on public finances, thus immobilizing this public investment, which is after all essential.
This aspect seems to us to be all the more important in view of the state of the productive economy and, above all, of the social situation caused by the policies elected as regards supply and by conflict and dissension over working and social conditions, which also often means that forecasts are not met.
We therefore think we should once again condemn the insistence upon and speeding up of economic strategies and policies which led to these situations, since it is clear that they could not improve trends before making them worse.
It almost goes without saying that in our view to depict the single currency as a great objective or great national and European scheme, or the panacea for all the economic and social ills, is to create fatal conditions for a fresh wave of frustration - the Chechini announcement, which was not pursued; Maastricht was cracked up to be the opposite of what it turned out to be, the White Paper on Competition, Employment and Growth did not prevent the employment rate from continuing to rise, cure the lack of or weakness in growth or increase competition.
We should like to draw attention to one new point in the Commission report before us - the emphasis placed on the question of the wage spread based on the example of the United States and some mythical downward flexibility, which we can only regard as an unfortunate reference, since it fails to consider situations such as those in Portugal where the range of wages is comparable to that in the United States but where such downward flexibility would exacerbate social inequality which is already on the limit of what is acceptable, if not for the sake of the economy then from the social aspect.
We urgently need to give consideration to cutting through the unfounded optimism, the lack of a global economybased approach, disregard for the social consequences of economic choiced made and the retention and stepping up of undeniably negative aspects.
There is no desire to moderate the strategy and economic policies because they serve certain interests and financial groups. We understand that, but that only makes it more essential for us to assert more strongly and more doggedly that there are other interests and groups to be supported, other social situations which need to be considered as a matter of priority. Economic, but not solely economic.

Hautala
(FI ) Mr President, the Commission's economic report for this year places far too much stress on growth and the strengthening of supply mechanisms. Mrs Randzio-Plath's report deserves praise in particular for pointing out that at present demand is weak in the European Union. This weakness in demand poses an obstacle to economic recovery and to so-called rational investment.
In her report, Mrs Randzio-Plath puts forward a number of very interesting and original proposals which our group supports. She points out that investments should not be treated in the same way as consumer spending, which does not give rise to innovations or foster future development. This is indeed an idea which should be taken into account in the Maastricht criteria. The overall impact of public spending should be assessed in the light of longterm perspectives. It is absurd to make savings today in areas which will later give rise to very substantial costs both for us and society. It could be said that a sound, sensible social policy also represents a sound, sensible investment for the future.
We could also discuss whether the idea of rational investment geared to the future could not be applied to the entire Community budget, which tends to look back into the past. Half the budget is accounted for by agricultural subsidies. Could we not see the Union budget as a whole as creating the conditions for future economic development? All in all, our position differs from that of Mrs Randzio-Plath only as regards the issue of whether the time has now come to make the transition to the Euro. Personally I would say that until such time as the thinking behind the Union's entire economic policy has been clarified, and while that policy offers no genuine prospects for the future, it is a somehwhat brave step.

Castagnède
Mr President, I would firstly like to thank Mrs Randzio-Plath for the positive qualities of her report. Its quality of diplomacy, first of all, when she delights in the optimistic evaluation of the Executive Committee. Its quality of content above all, when it comes to supporting the process of monetary union while also asking for forceful measures in favour of growth and employment, after recalling the dramatic weakness of demand within the Union.
As far as we are concerned - and we will perhaps be a little less diplomatic - we are even so a little surprised to hear the Committee in its recent report on the beneficial state of strengthened cooperation recall to mind what it calls the 'workforce potential' available to the Union, made up not only of 18 million unemployed, but an additional reserve of at least 9 million people who would enter employment if there were jobs. Really the fear must be that the European Union might not survive the lengthy conservation of such a heritage.
Mrs Randzio-Plath is quite right to say that after winning the confidence of the markets - which has now almost been done - it is now an urgent necessity to win the confidence of consumers, that is, the citizens of Europe by boosting growth and employment. The question, of course, is knowing how this should be done, especially when monetarism can no longer be used and when, moreover, member countries, bound by the stability agreement, are unable to provide the necessary answers, since circumstances deprive them of any room for manoeuvre. The answer therefore has to be European. It is on a Union-wide scale, we think, that a vigorous policy for growth and employment must be defined and put into effect, undoubtedly as a priority by the means suggested by Mrs Randzio-Plath, namely the revival of private and public investment. The revival of private investment by facilitating the access of small and medium-sized businesses to credit, we have already talked about. The revival of public investment by developing network policy, the policy of research and development, and in a more general way, by the development of structural policies.
In relation to that we can only be seriously worried by the spirit of stabilisation, even of reduction, of the means of the Union, which is presiding over the preparation of the Union budget for 1998, over financial prospects in the medium term and the reform of the structural fund. This is, on the evidence, an economic and political nonsense taking account of the circumstances and the state of our public opinion. In a more fundamental way, this view runs against the objective of construction of economic , we stress, and monetary Union.
Certainly, the Union must have a stable and secure currency, which is the heritage of all Europeans, protected from any manipulation. It cannot be deprived of the means of an economic policy which Member States are unable to conduct.
Europe's economic policy will be inevitably complementary to monetary union. Let us waste no time, let us not allow a period of vacuity of economic power in Europe to settle in. On the contrary, let us demand that the Executive Committee prepare for us the ways and means of action for economic government of the Union.

Berthu
Mr President, last year we had discovered within these walls that the Commission's Annual Economic Report contained almost nothing on a theme essential for growth and employment, that of investment. What is more, the few occasions we found it was mentioned, here and there, seemed extraordinarily lax.
This lacuna has been corrected in the current report, but the passages it devotes to the subject show a worrying situation, as we had feared. Indeed, with the current rates of investment, the pace of growth of the economy of the Community in the future can only be very slow, which is incompatible with the need to create jobs. We would certainly see a convergence develop in Europe, but it would be a convergence downwards, towards a situation of major chronic unemployment.
The report seems powerless to explain this situation, and all the more so since, in its view, the return on capital at the end of the day would not be too bad. So why this languor? In our opinion, the explanation should be sought in the interaction of investment and employment. Because of the high cost of our workforce, in a context of active competition and the establishment, directly or indirectly, of a sort of global employment market, investment intended to substitute capital for work with the aim of improving competitiveness has been very high. But as this evolution itself contributes to unemployment, as well as to the development of a psychological climate of depression, demand has remained low and capacity investments, for their part, have not followed. In all, global investment is trailing. We would also like to add that it is not enough to say, as the report does, that the return on our investments is the same today as it was yesterday: you also have to show that it is comparable with the situation in other parts of the world, since the market for capital is now also global. Now, that is not proven at all, and anyway, the Economic Report does not mention it at all.
Under these conditions, it seems to us that to get Europe out of the crisis of languor in which it is struggling, it is a matter of urgency to change policy and renew our thinking on the radical changes globalisation is imposing upon us, a globalisation which up to now we have not been able to control.

Lang Carl
Mr President, my dear colleagues, we have all read the Commission's Economic Report for 1997 attentively. It truly is a beautiful text, technically, well-researched, with figures, graphs and tables. You can smell professionals at work. It would be nice to feel able to believe what these gentlemen from the Commission say, but in actual fact, it is hard to do so.
It is hard to believe that globalisation is not a cause of unemployment, because of the unfair competition it inflicts upon our businesses, because of the relocations it brings about, because of the downward pressure it exerts upon wages. It is a factor of social regression. It is hard to believe that unemployment is a question of figures and flexibility of the labour market. Furthermore Parliament's report has the merit of emphasising the pauperisation of our continent and the growth of inequality. The flexibility of the labour market which you call for is synonymous with job insecurity, with deterioration of working conditions and with social regression.
It is hard to believe that the deflationary policies you are imposing will have a positive effect on growth and employment. It is hard to understand your dogmatic fixation with budgetary deficit, exchange rates and price stabilisation. The reconquest and the protection of our internal market should be your priority for producing European goods, in Europe, by Europeans.
Furthermore, the Eurocrats consider imbeciles those who do not think like them and have the cheek to write it, covertly of course, on page 31 of the document. But there is a vast lacuna in their world of figures and statistics: men are only a variable for adjustment, when they should really be at the centre of all concerns.
What do you think the markets will make of the persistant imbalance of employment when it comes to quoting your single currency, the Euro? Is an economy in good health an economy in which public debt is lower than 60 % of GDP, where the budgetary deficit is less than 3 %, or that of full employment? Really your open Europe is one of insecurity, social regression, unemployment and poverty. The policy you are pursuing has only one aim: to reassure markets for the introduction of the single currency, but it is for Europeans that you must construct Europe, and that is what you have forgotten.

President
The debate on the report by Mrs Randzio-Plath will be adjourned at this point.
We now come to voting time.

Votes
Ojala
, rapporteur, - (FI) Mr President, in my capacity as rapporteur I should like to ask that the vote on my report be held over to tomorrow, Wednesday. Mr President, to justify this unusual request, may I point out that yesterday we heard the statement by Commissioner Bjerregaard, but unfortunately Commissioner Flynn was not present. The answers gave rise to some confusion and now Commissioner Flynn and other members of the Commission can provide further explanations. From Parliament's point of view, it is very important that we should have this additional information before voting and that is why, Mr President, I should like the vote to be held over to tomorrow.

President
Mrs Ojala, you are asking that the vote be adjourned pursuant to Rule 131. Should we adjourn it until noon tomorrow or until noon on Thursday?

Ojala
Mr President, I think that tomorrow, Wednesday, would be a suitable time to hold the vote. Our committee is meeting today and we will be able to discuss the matter at that meeting - Wednesday is thus entirely satisfactory.
(Parliament approved the adjournment of the vote on the second reading on the common position adopted by the Council until noon on Wednesday)

Fabre-Aubrespy
Mr President, excuse me for interrupting, but it seems to me that you committed an error at the time of the vote. The amendment was not the subject of a separate vote since it simply replaced the first terms of the phrase by terms which were not the subject of a request for a separate vote anyway. Proceding as you have done, I think that you are going to make us repeat votes which have already taken place. You should have put the amendment to the vote first, then have taken a separate vote on the rest of the paragraph.

President
Mr Fabre-Aubrespy, when I commented at the beginning about confusion being caused in certain votes by various requests from the political groups I also had this point in mind. It is not necessary for you yourself to have requested separate votes on the paragraph in question. Other political groups have requested them, and I am effectively obliged to repeat the voting because that is what the Rules demand. I cannot decide that a vote is not required. I am obliged formally to do what the groups request.
On paragraph 39

Schulz
Mr President, I should like to know if paragraph 39 falls because of the adoption of Amendment No 9.

President
The services of Parliament do not subscribe to that view, Mr Schulz, but I would like to ask Mrs Roth for her opinion.

Roth
Mr President, it was agreed beforehand that paragraph 39 would fall if Amendment No 9 were to be adopted.

President
I have no objection to accepting your view, even though Parliament's services see things differently. We cannot, therefore, miss out paragraph 39.
On Amendment No 3

Schulz
Mr President, I have the unfortunate feeling that someone is creating confusion here. An Amendment No 3 has been tabled. That amendment must be put to the vote as a whole. If it is adopted, the original text will be changed; if it is rejected, the original text must be put to the vote. However, I have not heard anyone asking for a split vote on Amendment No 3. The rapporteur has not requested it. Above all, the author of the amendment has not requested it. I would therefore ask you to put Amendment No 3 to the vote as a whole, as requested by the Liberal Group, and then to put the original text to the vote.

President
Mr Schulz, allow me to say that you cannot always know what others have requested. Just because you have not requested it yourself does not mean that others have not done so. The Green Group has requested a split vote item by item.
On Amendment No 15

Roth
Mr President, the Swedish and Danish versions of this amendment have been mistranslated. They say that legal possibilities are being prepared in Sweden and Denmark. That is incorrect. These possibilities already exist in Sweden and Denmark. There is therefore a mistake in the translation. The amendment should say that Sweden and Denmark provide for these legal possibilities, since they already exist in those countries.

President
We will check the performance in those languages.
(Parliament adopted the resolution)

Tamino
Mr President, my group and I are voting in favour of Mrs Roth-Behrendt's report, which spells out clearly what this House has stated on several occasions, namely the need to leave intact those parts of the directive concerning the abolition of animal experiments in the area of cosmetics. The report which we have received on this is an inadequate one yet again; furthermore, the Member States have been found wanting, and above all the bodies set up by the European Union to implement the directive have not met their targets. However, this cannot justify reneging on the commitments laid down in the directive. So while expressing a favourable opinion on the report, we must repeat - with reference to what the Commissioner, Mrs Bonino, has said - that it is important not only in the case of finished products, but also for the ingredients contained in cosmetics that, as from 1 January 1998, animal experimentation should no longer be permissible, both because it is unnecessary and because effective alternatives exist. The European body which was to validate alternative methods has failed to carry out the tasks it was given: it must check the literature as soon as possible and identify research which deals satisfactorily with the problem of validating credible, reliable scientific methods which show respect for consumers and avoid unnecessary animal suffering.

Carlotti
The principle challenge we have to take up daily if we want to build a more humane Europe is the struggle against suffering: the suffering of men, but also of animals.
The latter concerns thousands of 'living beings' submitted to experiments every year. The cosmetics industry is particularly involved in these processes. More than thirteen types of experimental method, where this industry is concerned, are likely to use animals.
The directive 93/35/CEE, adopted in June 1993, planned, firstly, for 'prohibition of the marketing of products, ingredients or combinations of cosmetic ingredients tested on animals from 1 January 1998' . Furthermore, within the framework of this directive, the Commission is bound to 'present to the European Parliament and the Council annually a report on the progress made in terms of the development, the legal evaluation and the acceptance of methods which may be substituted for animal experimentation' .
The report by Mrs Dagmar Roth-Behrendt stresses quite rightly that, despite the criticisms made of the 1994 report, the 1995 report still contains no emergency measure on the methods which may be substituted for animal experimentation.
On the pretext of the absence of measures in this area by the OECD and the United States, the Commission has judged it impossible to impose a prohibition on animal experimentation. Does that mean we should tag along behind the United States? No.
Parliament has a role to play and should lead the Commission to give unrestricted support to the prohibition from 1 January 1998.
The Commission must undertake to start taking measures right now to develop alternative methods of experimentation.

Ephremidis
Every year 30, 000 animals die in cruel experiments to assist the production of cosmetics, despite the prohibition, in Directive 93/95/EEC, of the marketing of cosmetics containing ingredients or combinations of ingredients tested on animals and the commitment to promote alternative methods to replace animal tests.
This unacceptable situation is still with us because the Commission persists in delaying implementation of the prohibition and is kowtowing, for the umpteenth time, to pressure from very powerful commercial and financial circles and acting as a loyal disciple of the rules of profit and competition imposed by the big cosmetics manufacturers. Its systematic disregard of strong public opposition and of the resolutions of the European Parliament constitutes an act of complicity in the barbaric torture of thousands of animals and is discouraging any serious attempt to develop scientifically acceptable alternative methods which could replace animal testing in the cosmetics sector.
It is pretty obvious that no real pressure is being put on the industry to engage in the research and development of alternative methods which can provide a high and reliable level of safety, and that the resources needed for serious research and technological endeavour towards meeting all of the safety requirements and ensuring that the abolition of animal experiments does not lead under pressure of competition to new products, with new and inadequately tested ingredients which may have unforeseen side-effects on the consumer, are not being allocated.
In the light of that there is no justification for postponing implementation of the ban on products tested on animals after 1 January 1998. And there should be no exemptions to the ban. Quite the opposite, there should be a commitment to take specific measures to ensure that firms and industries which carry out experiments on animals are obliged to participate in development and validation studies and to fund research and work on alternatives.

Reding
The EU has problems when it comes to restricting animal testing in general, and to banning such testing in the cosmetics industry in particular.
Regrettably, it seems that the Commission is giving in to pressure from the industry and is totally unwilling to pursue a policy of promoting alternative testing methods. This means that more than 15 million animals will also be 'used' in European laboratories in the future.
This is an unacceptable situation, especially since effective alternative methods are already available. Because of a clear lack of political will, however, these are not being promoted.
In an effort to explain its inaction, the Commission takes cover behind the fact that the USA has also failed to introduce a ban on animal testing in the cosmetics industry. In my view, however, this argument does not hold water, since if it did, the EU would be unable to legislate independently of the USA at all. It is absurd!
Given that the European Parliament - the representative of the people of Europe - is calling unequivocally for a ban on animal testing in the cosmetics industry, there is no valid argument for failing to implement such a ban on 1 January 1998, as Council Directive 93/35/EEC allows.
Such a ban does not have to be to the disadvantage of the cosmetics industry. On the contrary, if products were to be labelled 'not tested on animals' in a positive campaign, it could even represent an additional selling point on the world market, in the interests of producers, consumers and animals!

Sandbæk
, in writing. (DA) The Commission's report is defective and does not seek the objective of implementing the ban on animal experiments. A ban which should and must be introduced, as promised, and not deferred any longer. The ban will not mean any adverse effects on consumer safety, and the development of alternative testing methods is already considerably advanced.
I am against standards being based on the principle of the lowest common denominator. So when the Commission states that a ban on the sale of cosmetics that have been tested on animals is not possible, partly because the USA does not have similar regulations, this is simply a pretext. Rather introduction of the ban in Europe could have a knock-on effect resulting in international recognition of alternative testing methods.
Regarding research into alternative methods, there is need for a programme of priorities. Without a framework, incorporating deadlines, it will not be possible to bring anyone to account for violations. We would then end up with a series of postponements, which is what the Commission's report seems to have been an attempt at.
It is expensive to research and try out alternative methods. Therefore the ECVAM approved money (9 million ecus over 3 years) must be used for its intended purpose. In 1996 a delegation of MEPs realized however that the approved money was not getting through in the full amount. This problem must be corrected. It is necessary to set up a group or committee which will keep a close watch to ensure money reaches its target. Otherwise we will get nowhere.
Only a framework and a proper, targeted contribution can encourage these alternative methods. But whatever it is, animal experiments in the cosmetics sector must stop - and now!
I fully share Mrs Roth-Behrendt's criticism and therefore vote in favour of the report.
resolution on genetically modified maize
Hautala
Mr President, my explanation of vote concerns the resolution on transgenic maize. I should like to draw attention to two points: first of all, it is clear that we are about to abandon the principle of prudence, which should be the main principle guiding politicians in the European Union. Decision-making should not involve risks which are likely to develop into full-blown problems. In this case, the Commission has clearly yielded to the demands of the representatives of commerce and industry anddisregarded the principle of prudence. I dare not imagine where this will lead us in the future, when the pressure will be even stronger.
Secondly, I should like to draw attention to the public's right to be informed of decisions which the Commission takes concerning genetic engineering. At present, the principle of transparency is being flouted and the scientific committees work behind closed doors. I have been trying in vain for three weeks to obtain from the Finnish authorities documents concerning the authorization place transgenic maize on the market. In my view, we cannot go on like this: each and every citizen has a fundamental right to be informed of the reasons on which the Commission bases its decisions.

Berthu
The transgenic maize affair offers up worrying similarities with that of mad cow disease and shows that the Commission has learned nothing, and understood nothing, unless it is the case that it has been pushed by unspeakable forces which it finds impossible to resist.
Once again, the Commission has shown itself to be more sensitive to the necessities of commerce and the free circulation of products than to risks to consumers. I should say that, this time, there was the added fear of upsetting the United States, which apparently had so little doubt about the malleability of their correspondent that they had already shipped their maize to our ports before they had even obtained authorisation to put it on the European market. What happened proved them right: the Commission gave way all along the line, after Leon Brittan explained to it, as the press reported, that we had better not upset our relationship with this great nation.
Apart from the obsession with trade and the free circulation of goods, there are other similarities here with the mad cow case. Firstly, one finds the absence of transparency over the reasons for the decision, and in particular over the soothing scientific opinions which, it appears, supported the Commission's decision, but which were only published in abridged form. Secondly, the Commission's singular method should be highlighted, by which it used outrageous procedures which exist which give it the right to substitute itself for the Council when the Council cannot come to a unanimous decision, exactly as it had when it lifted the embargo on British gelatine last year. However it might be noted that in the present case, thirteen States out of fifteen, in the Council, were in favour of the prohibition on importing transgenic maize and that the Commission had no hesitation in defying that crushing majority to place itself in the ranks of the two lax States, of which, sadly, France was one.
Thirdly, as in the mad cow affair, we have seen certain Member States defend their citizens, despite the position of the Commission. Austria, and even Luxemburg, have prohibited the distribution of genetically modified maize on their respective markets, to protect their populations. Finally, in this business too, the temptation is seen to be growing in the Commission to attack the recalcitrant States for obstructing freedom of circulation.
Thus are we called to regret once more the fact that the Commission is using the powers given it by the countries of Europe to destroy our defences, when its purpose on the contrary is to strengthen them. This unworthy conduct - because the Commission's primary concern should be to ensure the security of Europeans - can no doubt be explained by a total lack of patriotism, and a major susceptibility to external pressures. In their turn these faults are not fortuitous, they arise from the institutional structure itself of Europe today, dominated by a technocratic structure which considers itself superior to the nations and which, because it is so far removed from them, ends up losing all reference to reality and to the needs of people.

Deprez
I am anxious to show my keenest support for the resolution on genetically modified maize, voted for by our Assembly.
There is currently great concern among consumers about genetically manipulated foodstuffs. In this context, it seems to me essential, as far as one can accept the principle of putting genetically manipulated foodstuffs on the market, that the two following conditions be respected:
Firstly, the implementation of strict evaluation - based upon the most up-to-date independent scientific data - of the harmlessness of a product to human health, the health of animals and the environment, before it is put on the market; secondly, once this harmlessness has been proved, it is important to ensure that consumers are effectively informed, both by the broadcasting of relevant scientific opinion and by appropriate labelling. Everybody must be able to choose, with confidence, to consume what he wishes to consume, in full knowledge of the facts.
In the case of the request for authorisation to market genetically modified maize by the firm CIBA-GEIGY, the Commission decided on 18 December 1996 to give a favourable response, although none of these conditions was fulfilled. Indeed, the harmlessness of this product is not the subject of a consensus, the possibility of transmission to humans of resistance to an antibiotic being mentioned in particular; the complete scientific analyses by three scientific committees, upon which the Commission's decision was founded, have not been published; suitable labelling has proved impossible, because of the insufficient provisions of directive 90/220, and the fact that the regulation relating to new foodstuffs is not yet in force.
Consequently, I request that the procedure of authorisation of this product is suspended exceptionally, until firstly, a complete re-evaluation of the consequences for human health, animal health and the environment of its appearance on the market has established without ambiguity that it is harmless; secondly, all scientific opinions of the committees consulted by the Commission for this purpose have been made public; thirdly, the Commission has explained clearly, if necessary, if and in what way it intends to apply and enforce respect of the provisions of the regulation relating to new foodstuffs, as far as the labelling of genetically modified maize by CIBA-GEIGY is concerned.
To conclude, I would like to add three comments: in the first place, it would be a great pleasure for me personally to hear the Commission's position on the precise content of the labelling which will be offered in practice, when this type of maize and its derivatives reach the consumer; then, at the same time, given that large quantities of this imported maize are currently arriving in bulk in Europe, perhaps it is not pointless to envisage the establishment of strict standards, defined by a group of experts within GATT and recognised worldwide; finally, I dare to hope that the Commission will demonstrate, in the process of modification of the directive 90/220, that it has learned some lessons from this sensitive affair, knowing that this type of request to market is apparently likely to develop in the future.

Holm
The Commission's action with regard to Ciba-Geigy is dubious and irresponsible to say the least but not particularly surprising. Once again the Commission has bowed to financial and commercial pressure instead of protecting the environment and people's health. But it is surprising, however, because 13 of the EU's 15 Member States opposed the introduction of this maize onto the market.
It is positive and encouraging to hear that Austria and Luxembourg have not accepted the Commission's decision anyway and are now taking measures to prevent the sale of genetically modified maize on the market. I hope that other EU States will react in the same way, including my homeland Sweden.
People's concerns about eating genetically modified food are justified and must be taken seriously. In my opinion, there ought to be an immediate end to the cultivation and sale of genetically modified food. This situation is more than desirable but unfortunately there does not appear to be any action.
The European Parliament's common resolution is good, even if it is not sufficiently critical in some sections and I have no hesitation in voting for this proposal.

Jackson
The British Conservative MEPs are strongly in favour of taking all the necessary safeguards to establish that only foods which are safe are placed on our market. They also recognize that genetic modification is a scientific tool of possible benefit to mankind which should not be dismissed out-of-hand. Its possible usefulness in terms of the increased availability of food supplies and a diminution of dependence upon pesticides should be subject to rigorous scrutiny.
We believe that two considerations must be paramount in the consideration of genetically modified food: consumer safety and consumer choice.
On consumer safety, we note that the Commission consulted three expert committees before giving marketing authorization to this product. The findings of those committees and the list of their members are available to Members: for example, the membership of the Scientific Committee for Food is given in Official Journal C218 of 23 August 1995, and subsequent updatings have also appeared in the Official Journal. Where the Commission can be faulted is in not having closer contact with MEPs, especially in the Committee on the Environment, Public Health and Consumer Protection so that they get an early copy of the reports of such specialist committees and up-dated lists of their members. So long as Parliament feels shut out from the work of such committees, suspicion and lack of confidence between the institutions will grow.
On consumer choice, we welcome the fact that the Commission is to propose that all products containing GMOs will have to be labelled, thereby extending the current information requirements. If Europe's consumers do not want genetically modified products, then consumer power will tell, and firms marketing those products will find that the European market is not profitable for them.
We also welcome the news that Commissioner Fischler is to come forward with a proposal for similar labelling of animal feed.
We believe that with these safeguards Europe's consumers and Europe's farmers will be in the best position to combat competition from the US and to judge for themselves whether they want to choose genetically modified products or not.
We regard the joint motion for a resolution as seriously flawed in its rejection of the authorization that has been given, and out-of-date in that it does not take account of the announcements made by the Commission on 2 April regarding the labelling of all GM products. It does contain some useful points regarding the need for the European Parliament to be more closely involved in the process of authorization of GM products, and we have supported these elements. The only honest course open to us in the final vote on the whole text was therefore abstention.

Lindqvist
It is unacceptable for the Commission to allow the spread of genetically modified maize on the European market. A large majority of Member States are against this and public opinion is very critical. The EU ought to have learnt from the BSE crisis that health and consumer protection must take precedence over short term commercial interests. There have been insufficient scientific studies. The maize may be resistant to antibiotics and would therefore pose a great risk to people's health. It goes without saying that all genetically modified foods should be labelled so that consumers know what they are buying and eating.

Péry
The European Parliament condemns the irresponsibility of the Commission, which has authorised Member States to import and market products based upon genetically modified maize in spite of all of the negative opinions of the European Parliament, and which has done this to the detriment of the principle of precaution concerning the health of consumers and the protection of the environment.
France has, for this reason, seized upon this authorisation to permit American imports while prohibiting the cultivation of genetically modified maize, and the inconsistency of such a position can only be condemned.
It is true that the marketing of this maize had been authorised, several days before, thus nipping in the bud a crisis with the Americans, who had a cargo of 'Corn gluten feed' locked up in one of our ports.
Some very large interests are at stake. I will briefly recall the fact that transgenic maize has been made resistant to the larva of a crop-devastating insect. Its cultivation, which has already been carried out in the United States and Canada, produces better crops and strengthens the competitive edge of a product in a very competitive world market, as we know.
The uncertainty about long term effects, the desire to reassure consumers still traumatised - and quite rightly - by the mad cow crisis, have weighted the French decision, which many observers have judged inconsistent and preelectoral.
I am not out to reject scientific discoveries, because life is synonymous with evolution. Furthermore, the region I come from - the South-West of France - has largely profited from progress in seed. But the recent scandals and dramas which we have experienced must make us more cautious.
If the experts subscribe falsely to the view that there is no possibility of risk regarding modified maize, the Scientific Committee on Foodstuffs has admitted that there is a risk of transmission to humans of the marker gene which is resistant to antibiotics.
This re-evaluation should be pursued and, while awaiting this, authorisation granted to import and market these products should be suspended.
For us, the primary need is for transparency in the information conveyed to consumers. They must take their responsibilities in full knowledge of the facts, with the mandatory requirement for clear labelling of all foodstuffs containing transgenic products. This law was voted in by the European Parliament in January 1997 and should soon be applied in all 15 countries.

Souchet
Mr President, despite its deficiencies, I voted in favour of the joint motion for a resolution, because it condemns the irresponsibility of the Commission which, unilaterally, took the decision to authorise the marketing of genetically modified maize in spite of the negative opinion of the very great majority of the Member States and the European Parliament. But it should have gone much further than that and demanded that the Commission go back on the decision it made on 18 December 1996, for as long as sufficiently serious independent scientific assurances have not been given on its consequences as regards protection of human health and of the environment.
The same mistakes are being made over and over again: whether we are talking about authorisation to import genetically modified maize from the United States or the lifting of the embargo on gelatine, suet and bovine sperm originating from Britain, they are the same procedures which are leading the Commission to substitute itself for the Council and to act to the detriment of public health and the environment in our States. No lessons have been learned from the 'mad cow' crisis. And all over again, the Commission is setting itself up as the defender of economic interests which are not those of the Member States of the Union.
To my very great regret, the French government carries a great deal of responsibility in the process which is currently under way. It was the vote of the French minister which enabled the Council to obtain the qualified majority, thanks to which the substitution of responsibility could operate to the benefit of the Commission. It was the French government, with its decree of 4 February, which was the first and is still the only government to authorise the marketing of genetically modified maize (30, 000 tons of which, curiously, had already been in French ports for a month), while other European countries like Austria, Switzerland and Luxemburg decided to protect their populations. The two French Commissioners have naturally followed in the footsteps of their colleagues, AngloSaxons in particular, to authorise, without hesitation, the entry of MGM on to the market.
Thus we end up in France with the worst scenario: our own farmers are prevented from using the most productive seed, while products of genetically modified seed from third party countries are freely marketed. Consistency would have had it that the Union impose a complete moratorium (since maize is likely to be followed rapidly by genetically modified soya and rape, with all the risks they bring), until research with convincing results has concluded either that the marketing of this seed is harmless or dangerous. Why, on such an essential question, be so afraid of a dispute with the United States before the WTO? Or else, is the vocation of the European Union no longer to defend the interests of Member States, aspiring only to become, in the words of Valéry 'an American Commission' ?
Roth report (A4-0112/97)
Le Gallou
Mr President, we have voted against the Roth report both because of its aspects which are unrelated to the subject and because of its lacunae and omissions.
Indeed, the Roth report does not speak about the persecution to which the unions are subject in France. That is how a Force national-transports en commun Union came to be created in France in 1996. When this union nominated union delegates to the RATP, a major public transport company in the Ile de France, the management took these union members to court. Several weeks later, these union members presented a list for the professional elections. This list was refused and there were further proceedings, proceedings brought by the management and the unions of the system and won at the expense of the free union members, the legal system giving in to the demands of the authorities and the dominant unions.
There is therefore a serious attack on freedom of representation and the electoral freedom of workers here. These liberties are also threatened by attacks by the management of this major public enterprise against national unions: threats against union members and instructions to departmental managers to harass them. We are sorry that these attacks on freedom of representation do not feature in Mrs Roth's report.

Andersson, Hulthén and Waidelich
We welcome the Schengen Agreement as an important step towards the right to freedom of movement for the people of the Union. But we think that the way point 57 of the report is written could allow different interpretations particularly on the issue of using strong measures in the fight against drug trafficking. This is something we cannot accept.
Antilla, Lindqvist, Ryynänen, Virrankoski and Väyrynen (ELDR), Eriksson, Seppänen, Sjöstedt and Svensson (GUE/NGL), Gahrton, Holm and Lindholm (V), Bonde, Lis Jensen, Krarup and Sandbæk (I-EDN), in writing. (SV) The struggle for human rights is very important everywhere. In no way does the EU have sole rights in this domain.
Much of the content of this report is totally unnecessary in a report on human rights. Why should the EU become a legal entity and sign conventions? Why should so many of the measures be raised to a federal EU level? Why do Community level controls need to be introduced?
We are against this and think it is totally unnecessary in an otherwise quite good report. Of course we will also be voting against the proposal that the European Court should have jurisdiction over the implementation of the Schengen Agreement.
The good thing about the report is that it is progressive on many points and highlights a number of matters which are currently badly handled by EU Member States. But this does not mean that they would be better handled at community level. On the contrary, there would be even less democracy in the EU.
We think that the criticism of the repressive and often racist asylum policies is justified.

Banotti
I voted against Amendment No 43 on abortion information - as it is worded it is unacceptable.
Not even the most radical pro-choice supporters are actively advocating abortion. Abortion is a choice many women make for a variety of reasons - many tragic.
In Ireland we have a very high level of abortion, disproportionately high in comparison with other EU countries.
I believe our resources should be focused on prevention of unwanted pregnancies and support for those who feel forced to take this choice.
Our constitutional referendum overwhelmingly supported information and freedom of movement. So do I.

Berthu
We are sorry that the European Parliament has thought it right, despite our negative votes, to adopt the Roth report which contains a whole series of aberrations, like the request to Member States to recognise homosexual couples and to grant them the right to adopt children. We also find that the European Parliament has once again declared that freedom of circulation is not a reality in Europe, on the pretext that border controls on persons have not been abolished completely. Once again, this is not our opinion and when we move around in Europe we do not experience controls as hindrances to our freedom of circulation.
I would, however, focus my explanation of vote on a specific technical point, since Parliament has just asked that the Schengen Agreement come under the competence of the Court of Justice of the European Communities. We do not agree, for two reasons, of form and of substance.
On the form, we do not see why the Court of Justice, which is a community institution which comes under the fifteen Member States, should deal with specific agreements which certain States conclude among themselves, except of course if the States request it expressly. But that is not the case here. This observation should be relocated to the context of the debate at the Intergovernmental Conference on differentiated cooperation, which we hope we will not see become a matter a priori and systematically for the Court of Justice.
On the substance, it is unlikely that matters relating to the circulation of persons, and in particular foreigners, which closely affect public liberties and national sovereignties, will be able to be entrusted to the arbitration of an institution which is not a democratically elected assembly and which is not a national constitutional Court subject to the democratic regulation of each State either.
We are presented with an acute problem, which nobody wants to look in the face, of distortions between the status of the Court of Justice, which was at the start a Court intended to deal with technical problems linked with the interpretation of a well-defined treaty, and the breadth of competence which one would like to give it today, which would result in the serious diminishing of national democracy and straightforward democracy itself.
We hope therefore that the Intergovernmental Conference might demonstrate realism, and that, before any extension is made to the competence of the Court of Justice, it should revise its status in such a way as to introduce into it, one way or another, the right of appeal before national parliaments on questions of principle.

Imaz San Miguel
The Roth report looks at important aspects of promoting human rights in the European Union, including reaffirmation of the position of the European committee against torture, support for victims of violence and terrorism, and many others.
However, on the rights of persons in detention, paragraph 76 'reaffirms the principle that imprisonment should IN MOST CASES take place at a location that is as near as possible to the detainee's family and/or social environment' . The introduction of the words 'in most cases' in the Committee on Civil Liberties restricts a universal right which is implicitly recognized in the European Convention for the Protection of Human Rights, leaving it to the arbitrary decision of governments.
That is why I abstained in the final vote.

Kirsten Jensen, Blak, Sindal and Iversen
The Danish Social Democrats in the European Parliament have voted in favour of Parliament's annual report on respect for human rights in the European Union (1995) with the exception of point 159.
We believe that the report is satisfactory in general. Our opposition to point 159 is due solely to the fact that it contains a factual error. Thus Danish criminal law contains an unequivocal ban on the possession of 'photographs, films or similar items portraying children having intercourse or sexual relations other than intercourse' (Criminal Law § 225, point 2). This ban also covers paedophile magazines.

Lucas Pires
I voted with my Group (the PPE) against the Roth resolution even though I supported over 90 of its paragraphs and appreciated many aspects of the rapporteur's work. The report does, however, contain inaccuracies and goes beyond the scope of a work of this kind, which ought above all to help to bring to public awareness the problems concerning the fundamental rights of citizens in the European Union who deserve better attention and treatment. On the other hand it seems to me that social rights and environmental rights not only hold a different significance, but should be studied in greater detail by the relevant Parliamentary committees.
In addition to this general criterion which helped me to finally make up my mind about the report as a whole, my criteria for voting on the various paragraphs were as follows:
I voted in favour of many paragraphs on the mechanisms for strengthening human rights, the right to life and the right to freedom of movement, the rights of access to justice, rights of prisoners, the fight against racism and xenophobia, the right to privacy, non-discrimination and children's rights.
I voted against those paragraphs mentioning individual Member States which have not had the opportunity to put their side of the case which must be regarded as States following the Rule of Law, plus those paragraphs dealing with national policies on asylum and immigration when there is still no real European policy in this area;
I abstained on those paragraphs on human rights outside the European Union or concerning events in years other than 1995 and on paragraphs which wove fact in with fiction.

Miranda
We find it very positive that the European Parliament is making a serious and in-depth analysis of respect for human rights in the European Union, all the more so since there tend to be too many value judgments made about what is happening in this field outside the Union. There are various significant problems noted within the European Union.
Fundamental rights and freedoms are not infrequently called in question. Racism and xenophobia are spreading. There is a growing tendency to curb the right of asylum. All forms of discrimination are on the increase. It is important to stress that negative phenomena are on the increase particularly in the social sphere, and they cannot be ignored here, despite what some sectors of this House claim. The right to a job, steady employment, adequate social security and finally a dignified standard of living are undeniably essential aspects of human rights; this list should also include the fight against unemployment, poverty, exclusion and marginalization.
Mrs Claudia Roth has for the most part approached this subject in a thorough, positive and appropriate manner in her report, which we welcome; we shall be voting for it. We shall for the same reasons be voting against the proposals tabled which run counter to the spirit of this approach.

Reding
When it comes to human rights, Europe must defend its good name on the world stage. I therefore greatly regret the fact that the opposition of some EU Member States to a resolution which critically analysed the human rights situation in China has meant that the Union is not now tabling a human rights resolution before the UN.
The human rights debate has been supplanted by concern for business interests. I also wish my negative vote to underline this scandalous situation!
Human rights have no political complexion. They are neither Christian Democrat nor Socialist. Rather, they are universally valid, as is enshrined in the relevant international conventions. The concepts must therefore be clearly defined, and these general principles strictly applied.
Unfortunately, this is not the case in the Roth report. The report is ideologically biased, and contains many elements which have a great deal to do with economic, social and environmental policies, but absolutely nothing to do with human rights. It is a ragbag of issues, problems and lists which mean everything and nothing.
I would have preferred to see a discussion of fundamental rights, such as the rights to life, integrity, adequate defence before the courts, freedom of expression, privacy, non-discrimination and the like.

Wibe
Any report on this subject should, in my opinion, deal with excesses against fundamental human rights such as the freedom of speech, freedom of the press, religious freedom and freedom of association. It should also investigate and advise on whether the right to legal aid and the right to be allowed to do military service without bearing weapons are being correctly enforced in the EU Member States. But to expand the term, as has been done in this report, to include the right to freedom of mobility within the Union, social security, the right to medical treatment and so on is incorrect. These issues belong in other political arenas. Perhaps future issues of this annual report could be extended to include comments on other failings based on a model for good quality of life, such as the right for all citizens to live near beautiful municipal parks.
Of course it is never wrong to demand better health care. But that is not the point. The core of our criticism lies in the fact that the term human rights is being confused with the term quality of life through such an expansion. 'Human Rights' has a quite distinct meaning in the international arena.
Point 119 of the proposal for the Resolution complains that more and more districts, particularly in France and Germany, outlaw begging. Expressing oneself in this way in a report shows that we accept begging as a source of income for some people. This cannot be tolerated.

President
That is the end of voting time.
(The sitting was suspended at 1.35 p.m. and resumed at 3 p.m.)

Growth, employment and convergence (continuation)
President
The next item is the continuation of the debate on the report ((A4-0111/97) by Mrs Randzio-Plath, on behalf of the Committee on Economic and Monetary Affairs and Industrial Policy, on the Commission's Annual Economic report for 1997 - Growth, employment and convergence on the road to EMU (COM(97)0027 - C40078/97).

Metten
As long as our governments put all their energy into meeting the convergence criteria, unemployment is unlikely to fall. We know why this is. Economic growth in the Union is too low. Average growth of 2½ % is needed simply in order to absorb the increases in productivity and the growth in the supply of labour, but we are not achieving this, and the outlook for the future is poor. Why is the economy in the European Union not enjoying more robust growth? The Commission has no answer to this. Like last year, it concludes that all the supply factors such as inflation and wage levels are favourable for stronger growth, but it refuses to believe that the cutbacks of an average of 1½ % of GDP which the Member States are aiming to make in 1997 have anything to do with the low level of growth. On pages 77 and 78 of the Annual Economic Report, for example, it claims that a further cut in interest rates and the feel-good factor will compensate for the fall in demand caused by the cutbacks. It therefore feels, quite wrongly, that it no longer needs to insist that those Member States which are in a position to focus policy on maintaining and promoting growth should actually do so. Yet stimulating employment by promoting growth should be given at least the same priority throughout the Union as achieving the convergence criteria. And promoting growth and achieving the convergence criteria are not mutually exclusive, of course. Higher growth not only creates more jobs, but also makes it easier to achieve the convergence criteria anyway. Both objectives, employment and the convergence criteria, are the joint responsibility of the entire Union, and this is why the countries which already meet the EMU criteria and are enjoying stronger growth should be urged at least to maintain growth at its current levels, for the benefit of other Member States.

Cassidy
Mr President, last year I was the rapporteur on the 1996 annual economic report and I am very conscious of the difficulties under which both the Commission and the rapporteur have had to work. I wish to congratulate the Commission this year on having got its annual economic report together rather more coherently and rather earlier than last year. I would also like to congratulate the Commission on a welcome note of realism in this year's annual economic report.
There has been a tendency in the two previous years to be a little bit too sanguine about the prospects for the European Community's economy. Quite rightly, this year the Commission has highlighted that there has been absolutely no improvement at all in the overall employment position here in the Community. That remains the fundamental problem which faces Europe. As the front cover of The Economist said this week: Europe is not working! The answer to that problem, of course, lies not really within the European Commission and still less in the European Parliament, it rests with the authorities in the Member States.
I am delighted to see that, although I do not agree with everything the rapporteur says in her report, there is an acknowledgement - in paragraph 8 of the resolution - of the harmful effects of 'high statutory non-wage costs on labour' , which leads to a reluctance to hire people. But, on the other hand, there is a lack of realism: in an earlier reference in paragraph 5(ix) we have the usual rehearsal of left-wing objections to the activities of speculators. It is not often appreciated that speculators can be Member State governments, for example, who might hold off paying money to the European Community, expecting to have an improvement in their national currencies' exchange rates against the ECU.
There is, however, one thing to which I would like to draw attention: paragraph 26, which calls for an end to 'what is unfair competitive taxation in the European Union' . If taxation is 'unfair' , it is because some Member States maintain too high levels of tax, and the effect of competition in tax, as in air fares and everything else, should be to bring down tax rates. That would increase Europe's competitiveness and would also result in a revival of the European job market.

Soltwedel-Schäfer
Mr President, ladies and gentlemen, I should like to concentrate on our amendments, and in particular Amendment No 9 on growth, employment and convergence on the road to EMU. Economic growth alone is not an adequate indicator for combating and reducing unemployment. When you consider that the German Government has promised to halve the number of unemployed by the year 2000, a similar exaggeration with regard to Europe is not difficult to understand.
It is quite wrong to regard growth as the sole driving force and goal of Europe's economies. Economics and ecology go hand in hand; unfortunately, however, people are coming to this realization far too slowly, and not in sufficient numbers.
The annual economic report - and this will be nothing new to those attending this debate - lacks a forward-looking European economic philosophy. And I use the word philosophy quite deliberately - it simply lacks the sense that Europe needs to bring its economies into line with one another. The situation in Germany, which has a publicsector share of 51 %, is totally different from that in the United Kingdom or Greece, for example. We therefore also need to address the issues of the public-sector share and bringing Europe's economies into line with each other.
With regard to monetary union, let me say the following: we must not begin monetary union by lying to the people. I would particularly ask Mr de Silguy to bear that in mind. Paragraph 12 of the annual economic report refers to pension liabilities and the reserves to cover them. If it is the case, as in Germany, that this question of pension liabilities is not raised, not even in the context of the criteria for EMU, then this is starting with a lie, and the criteria are being fudged. We must remain credible. The postal workers in Germany will be the latest to see that something is amiss in that country.
Lastly, I wish to point out that the German version of Amendment No 5 contains a translation mistake. It should say 'ineffective control' , not 'inadequate control' .

Lis Jensen
Mr President, Mrs Randzio-Plath's report states, among other things, that one cannot go along with the Commission's proposal on greater wage distribution between the regions. I am very much sympathetic to this view, since this is not a matter for either the Commission or Parliament to tackle, but something that must be handled locally, either between bodies involved in the job market or in the national parliaments, in accordance with the regulations of the individual countries. The annual economic report from the Commission also expresses a wish for greater wage distribution within the different sectors and branches. It is a pity that the rapporteur is not here now because I would have liked to hear her views on this.
The report fully supports Delors' white paper on growth, competitiveness and employment, and this surprises me somewhat because this also advocates wage distribution. Moreover I must refrain from supporting the resolution to introduce gradually absorbed wages for the least qualified, the young or the long-term unemployed, since in my own country this has always meant a violation of collective bargaining rights which are enjoyed by those operating on the employment market. And to propose a form of economic control at an EU level would mean going off at a tangent. Let us give this more thought, and let us instead discuss whether adoption of the EMU convergence criteria is not the real reason for the unacceptably high unemployment rate in all EU Member States, before convincing ourselves and others that the unemployment problem can be resolved by adopting the EMU. Let us listen to the strong protests being raised against the EMU plans throughout the countries of the European Union.

Lukas
Mr President, I agree with the rapporteur's view that the annual economic report is too optimistic and does not take the problem of rising unemployment seriously enough. It makes an over-simplistic connection between competitiveness and labour costs, whilst ignoring the importance of creativity and innovation to both production and marketing.
The mania for budget consolidation in both the public and private sectors is directed too much towards cutting jobs and too little towards investment. The example of France makes it clear that competitiveness cannot be improved by reducing labour costs alone: despite the reduction of labour costs in that country, unemployment has not fallen, and there have been further losses of market share. It will therefore be important in the future to take a critical look at the EU's patterns of expenditure.
As long as the bulk of the Member States' financial contributions is poured into support for agricultural overproduction, while comparatively paltry sums are earmarked for research and development, we should not be surprised if the EU's competitiveness is declining.

Fayot
Mr President, the great debate which casts a shadow over the Commission's Annual Economic Report is, of course, that of employment.
We know that we cannot satisfy ourselves in this respect with the single thought, and that we must find something else. We cannot satisfy ourselves with economic policies at national level, when monetary policy will be on a Europe-wide scale. We cannot allow unemployment, poverty and exclusion to develop and leave everything to the market. The excellent report by my colleague Mrs Randzio-Plath is intended to give a lesson in voluntarism in this respect and, with your permission, I would like to extract two ideas.
The first idea is the need to give a European dimension to economic policy. Mr President, Commissioner, I come from Luxemburg, a country which every year for the last ten years has created thousands of distinct new jobs, and yet unemployment rises inexorably. Why? Because the country lies at the centre of a basin of cross-border employment in which unemployment is as high as 10-15 %, or more than that. This shows very well that a country which is pursuing a policy of growth faster than its neighbours above all is supporting the economy of its neighbours. And if we want national policies to succeed, we should at least make sure we coordinate them at a European level.
The second idea is the need for a common policy for growth. The dyed-in-the-wool dogmatists say no, that is not possible. Because they are absolutely set upon the criteria of convergence for reaching the single currency, they want neither to let another penny go to the Community budget, nor to care about their neighbour. The Socialists say yes. Without lapsing into a blissful Keynesianism, they think that it is possible to act upon demand, even with a European budget which is only 1.27 % of GDP.
If I may permit myself, Mr President, to paraphrase Jacques Delors, would the European Union, which is borrowing so that it can lend to Bulgaria and Hungary, not do so to invest in its own quality of life or the future of its younger generations?
Mr President, I therefore think indeed that as the rapporteur proposes, we must have an economic policy of European dimensions and, above all, an economic policy for growth.

Fourçans
Mr President, I am perhaps going to make myself look like a defender of the single thought, which will please Mr Fayot, but that is too bad, I will go ahead anyway. I would like to give my reaction both to the Annual Economic Report and to Parliament's report.
I would be less critical of the Annual Economic report than is Mrs Randzio-Plath, but I still have a number of remarks to make on the Commission's text.
Like the Commission, I think that the improvement in performance of the European Union should be saluted, and the renewal which is under way should encourage us to continue along the route we have mapped out. Having said that, and I think everyone agrees, we should not rest on our laurels because we are a long way off reaching the target for growth and for unemployment, which, as we know, is still dramatically high.
Why, in fact, do we have this poor growth rate and high unemployment rate in Europe? For a large part, it should be said, because of the poor economic policies pursued since the beginning of the '90s: budgetary policy which is too lax, monetary policy which has been badly managed, until recently at least, and an employment market which has become too inflexible.
So, my dear colleagues, let us learn lessons from these examples from the past. We will not solve our growth and employment problems by relaxing budgetary discipline, and we will not solve our growth and employment problems by relaxing monetary policy. In proposing these kinds of measures, the report which Mrs Randzio-Plath has presented to us misses the mark.
The reduction in real interest rates, which our rapporteur quite rightly hopes for, will not come as a result of this kind of relaxation. It will result from the pursuit of budgetary cleansing, from the removal of risk premiums on interest rates and therefore from a stable monetary and fiscal environment.
Contrary to what has been proposed to us, we must reduce public spending and obligatory contributions, and to do that, we must implement a number of structural reforms in order that these reductions actually take place and will last.
From this perspective, we have two large areas of work to be done in Europe. The first concerns the reform of the labour market. This must, as a general rule if not in all countries, be rendered more flexible. Above all, we must accelerate the reduction in labour costs, in particular for the least qualified, contrary to what our previous speakers have said. Because that is where the key to unemployment lies, unemployment among the poorly qualified, which is the largest sector of unemployment in our various countries. And to do that, there is no other solution than to reduce obligatory contributions. I am rather sorry that the Commission has not stressed this matter a little more, even if it has mentioned it.
The second area of work concerns the problem of globalisation and the progress of technology. The Annual Economic report gives an interesting chapter on the subject. There again, I think the subject deserved to be developed. Perhaps it will at the next presentation. I would like to stress one thing on this subject, which is that there is no a priori reason why globalisation should not lead to the creation of jobs, even if this poses a number of problems in the short term, as we know.
Anyway, I will stop there, Mr President. I would just like to say that, with the PPE group, I and Mr Herman have put forward a number of amendments: the fate reserved for these amendments will obviously determine the group's vote.

Svensson
Mr President, for twenty years there has been mass unemployment in the European Union. One of the reasons for this has been the dominance of orthodox economic theories in economic policy. So the report by Mrs Randzio-Plath is a refreshing change. It advocates an aggressive, expansive policy. It offers an insight into the active role played by the public sector in finance policy. The report breaks with orthodox opinion which is otherwise the hallmark of debate in the European Union and its institutions.
On the other hand the report contradicts itself by expressing confidence in the role of currency union. It is precisely the EMU regulation system which must bear the greater part of the blame for deflationary policies. The notion of convergence must be given up in the long-term if we are to deal with the crisis. We must establish a new freer currency co-operation on a more global basis. Despite these criticisms the report is still a ray of light in the darkness of dogmatism.

Moretti
Mr President, crying over spilt milk will not solve the problem of unemployment in Europe. The obstacles to true economic growth and increased employment are well known by now, and most of the Member States are falling over one another to suggest solutions which they do not then put into practice. Italy is a bad example, one not to be followed, where the fashion is still to nationalize losses and privatize profit. The Wages Guarantee Fund applies only to large companies; small firms have no access to it. Why is the Union wasting time before setting up well-targeted projects in favour of small and medium-sized enterprises?
The data available confirm that the many economic and employment-related problems can only be solved by giving a helping hand to small businesses. Let us waste no more time: let us invest in infrastructure, transport networks, the environment and energy; let us organize ourselves better, so that small and medium-sized enterprises can benefit from research investment and the Member States can reduce the fiscal burden consisting of taxes and social contributions.
We have been heading in the wrong direction, but we can remedy the situation by putting an end to unfair competition in the fiscal sector: a fiscal protocol should be incorporated into the Maastricht Treaty, containing a good practice guide for Member States on the taxation of businesses and capital.

Caudron
Mr President, my dear colleagues, this afternoon's debate on the Commission's Annual Economic Report gives me the opportunity, first of all, to commend our colleague, Mrs Randzio-Plath, warmly on the quality of her work as well as the thoroughness and intelligence which are characteristic of her in all her work. This report also leads me, Mr Herman, to say that the Executive Committee has worked hard, in the context of the treaties which govern us, obviously, and the decisions of the Council of Ministers, without of course forgetting, Mr Herman, the dominant liberal ideology in which our Union basks.
But when you have 18 million unemployed and 9 million people who would enter work if jobs existed, the rather artificial convergences required for the single currency, the small amounts of growth which have no real impact on unemployment, and the proposals which rush towards greater flexibility of work, less social protection and greater liberalism, are no longer enough.
While I approve of some of the Executive Committee's proposals on education and training and on local employment initiatives, I would say, like many others here, that unemployment needs shock treatment, along with effective stimulation of internal demand for goods and services, a reduction in interest rates, an increase in research and development, a less dogmatic and ideological approach to the criteria for convergence, a way of proceeding with restructuring which is undoubtedly gentler, and finally a genuine desire for industrial development.
What it requires therefore - and I am concluding in a general way - is that before any decision is made, all the decision-makers analyse its effects on employment in the short and medium term. That is how, and it is the only way, confidence will return and, along with a progressive reduction in working hours, unemployment will finally fall.

Langen
Mr President, ladies and gentlemen, I think it is unfortunate that the rapporteur is not present for the continuation of the debate this afternoon. However, I would not have congratulated her, since her report is not as good as others have made it out to be. In fact, it contains a great many contradictions.
I should like to thank the Commission for a good and generally realistic annual economic report. The criticism of Mr de Silguy is unjustified, since ultimately it is the Member States which are responsible for economic and financial policies. The Commission cannot be blamed for the Member States' failings in their entirety.
As many speakers have already pointed out, Europe's main problem is high unemployment - structural as well as cyclical. Increased growth alone will not be sufficient to remedy these structural shortcomings. It is certainly needed to create new jobs, but it is not enough. As the Commissioner rightly indicates in his report, Europe has opted to take an unequivocal free-market course. Through the single market programme, the Maastricht Treaty and EMU, clear and promising ways to improve the competitiveness of European jobs have been set out.
Key objectives are to establish the free movement of goods, services and persons; to enhance Europe's competitiveness through the liberalization and privatization of important sectors such as telecommunications, transport, postal services and energy; and to extend the trans-European networks, for which the funds are still lacking. Other important goals are to rein in the State and reduce state responsibilities - a matter covered by the Maastricht Treaty - and also to fight inflation and achieve the convergence of monetary and financial policies.
A currency's domestic stability is ensured in particular by a low rate of inflation. Europe can boast a number of successes in this respect. We are agreed - and the portrayal of EMU in the report is therefore accurate - that we can achieve the introduction of the euro, the launching of stage three, without relaxing the criteria and by interpreting them in accordance with the Treaty. However, what we certainly cannot do - and here Mrs RandzioPlath's report contradicts itself - is take remedial action in the form of short-term, Keynesian anti-cyclical programmes designed to stimulate economic activity, which merely produce a flash in the pan in the wrong places. On the contrary, we must eliminate structural shortcomings in the right places, as indicated by Mr Fourçans in his speech and amendments, for example by regarding public investment not as a substitute for, but as the basis of, private activity.
Above all, we must promote the flexibility of the labour market and eliminate the problems in the internal market - the remaining barriers to trade, for instance - as soon as possible. I would therefore urge you, Commissioner, to stay on the right track and carry on with your policies as you began.

Theonas
Mr President, the excessive optimism of the Commission's report is provocative: it speaks of a successful transition to EMU, of real growth in GDP, of new job creation, of strong economic recovery.
In our country, Mr President, we use the expression 'God first drives mad those He would destroy' to explain the self-destructive consequences that can occur when a person is out of touch with reality. This Greek popular saying appears to be totally apposite to the case of the European Union's principal institutions. The persistence with a policy that is increasing unemployment, poverty and social exclusion in Europe by the day is truly remarkable. The European social model is falling apart; the worker is gradually metamorphosing into someone who just has a job; the labour relations that have been built up through the struggle and sacrifice of an entire century are literally disintegrating; the demands of bankers are taking precedence over the democracy of the people.
I can see no alternative to popular mobilization and a fight by the workers in defence of their rights. Only then, perhaps, will the European Union draw the conclusions that it should draw.

Katiforis
Mr President, Commissioner, ladies and gentlemen, I had prepared a note, but it shall not speak from it because I want to dispute some of the things that have been said by Members on the other side of the House.
For example, it has been said that we should not rest on our laurels! Which laurels, Mr Fourçans? Where did you find them? The workers of my country are finding only thorns, and resting on thorns is not very easy.
It has also been said that we must reduce taxes and air fares. Down to what point should we reduce them? To the point at which the planes start to fall out of the sky? Are we to have a cost- benefit study setting the added profit of the airlines against the added value of the lives of the passengers who will die? Financially such a thing would make sense: the value of the lives of the passengers is limited. And, of course, the added profit may more than compensate for those lives. Is that the sort of value judgment that we should be getting in to? Economics is not an exact science. It is a science full of value judgments, and, before we finish with the technical aspects, we would like you to tell us which of the values out of those that we defend are furthered by the economy.
I am not one of those who believe that unemployment should be used as a weapon for getting on top of inflation. That, in effect, is what your report advocates. Not is so many words, of course; but it does, essentially, advance the case that unemployment should be used as a means to controlling inflation. We would have preferred a different report, because there are ways of getting on top of inflation other than by allowing unemployment to race out of control to the current 12 % and to the 20 % that it will rise to very soon and to the 30 % that will come after that. Where will it end? This business that began in 1970 when stagflation was tackled to the detriment of the workers, where will it end? That is what the whole of your case boils down to. Year after year you say the same things over and over again. You never make the slightest effort to find another way through the problem.
In finishing I would like to endorse the proposal made by Mr Donnelly this morning that other viewpoints on the matters covered by these reports should at long last be given a hearing so that we can escape from the intellectual cul-de-sac that you have led us into.

van Velzen, Wim
Mr President, in the annual report, the Commission calls - rather surprisingly - for greater wage differentiation between the regions. I cannot think of any arguments in favour of this. I do know that people in Europe already have tremendous problems with the wage differences between the various countries and the unfair competition which these create, and I can therefore only imagine that the Commission's proposal will force wage levels down, and with them the benefits that are directly linked to wages in many countries, as well as the minimum wage. I think the Commission's proposal is a really outrageous one, especially when it has not had the courage to bring forward a directive at the same time on a minimum wage. In other words, it has produced a proposal which will force wages down, yet it refuses to introduce a directive which will give the people of Europe the minimum basic protection that they need. I think the only sensible thing to do is to withdraw the proposal as quickly as possible.
Another reason for opposing this proposal is that it would seriously weaken the position of the trade unions, and there are absolutely no grounds for doing this. On the contrary, we should be trying to find ways of improving and consolidating their position as part of the social dialogue that we are forever discussing.
Finally, one of the biggest problems we have is that firms are currently moving to locations outside the Union, and the Commission's proposal is only likely to increase this trend. I cannot understand why this was not given due consideration. It seems to be yet another attempt to substantiate the old complaint that the workforce is not sufficiently mobile.
If we want to increase mobility among the workforce, then we need to ensure that something is finally done about harmonizing wages and social security. This would also mean finding a genuine solution to the problems faced by frontier workers in the areas between the Netherlands and Germany and between the Netherlands and Belgium, which have been under the microscope for ten years now without any sort of useful proposals coming from the Commission.

Willockx
Mr President, I should like to speak first of all about the Maastricht Treaty, monetary union and the convergence criteria. We insist on a correct interpretation of the convergence criteria and reject any simplifications or talk of symbols, but after the recent ECOFIN Council and having read the newspapers over the last few days, I fear that we are indeed gradually becoming bogged down in symbolic discussions and that it is becoming increasingly difficult to produce a serious interpretation of the convergence criteria which is in keeping with the spirit and the letter of the Maastricht Treaty. My second point is that we naturally need to prepare for the third stage of monetary union, and I would refer here to what Mr Cassidy said about fiscal competition. I am extremely concerned about fiscal competition and the ease with which tax bases can be moved from one Member State to another, and I am afraid that this will mean less money for social protection, and that if we have monetary union while we still have fiscal competition, but without tax coordination, social protection will come under increasing pressure. Thirdly, the finishing touches were last week put to the stability pact, which is now to be known as the pact for growth and stability.
Commissioner, I wonder if you could tell us where, in the stability pact, ' growth' is described as a proactive objective? The stability pact rightly assumes that the convergence criteria must continue to be observed even after the third stage, and I entirely agree with that. But what the stability pact lacks is the growth element.
I would strongly urge you to do something about this. If you do not and my fears become a reality in the Member States, while you continue to insist that only a monetary free market can ensure the future of the people of Europe, it could mean the end of the European ideal as far as the public is concerned, which is the very worst thing that could happen.

Wibe
Mr President, I would just like to point out that there are a number of serious errors in the description of the economic situation in Sweden in the Commission's report. For example, it states that interest rates have never been as low as they are now and that the difference between the interest rates in Sweden and Germany has never been so small as now, but this is totally untrue. The Commission is basing its information on nominal interest rates but, as every economist knows, it is real interest rates which are important in this respect and these have never been as high in Sweden as they are now.
It goes on to say that the level of savings has gone up in Sweden as a result of lower growth rates, i.e. a sort of reverse Keynesian relationship. Once again the truth is the opposite: We implemented a tax reform in Sweden which increased the profitability of savings. The level of savings rose, demand fell and the rate of growth fell as well. Every Swedish economist is aware of this.
The Commission cites these mistakes to provide an illustration of the fact that economic development in Sweden has been favourable because we have followed the economic policy recommended by the Commission, whereas traditional Social Democratic policies failed. But it is the reverse which is true. It was when Sweden ended their Keynesian demand policy, when we started to fight inflation before fighting unemployment, when we started to apply the convergence criteria, or to put it briefly, when we adopted the new liberal policy recommended by the Commission, that Sweden began to have problems. It was then that our unemployment went up from 2 to 12 percent. Swedish development is therefore an excellent example of the fact that a traditional social democratic policy works, a policy which tackles unemployment before fighting inflation.
It is my tragic prediction that unemployment in the Union will not be reduced until both the Commission and the Council understand this fact. Unfortunately, the many errors in the report makes me fear that it will be some time before this realisation hits home.

Pérez Royo
Mr President, the most salient feature of the Annual Economic Report is the Commission's self-satisfaction in assessing the economic situation in the Union.
The result of that is a passivity which entrusts all economic certainty to the maintenance of a few healthy balances or macro-economic fundamentals, public finance and inflation in particular, as if this were enough to ensure growth and the creation of jobs.
The evidence from the various economies does not confirm this analysis. The macro-economic fundamentals are improving, nominal convergence is progressing, but the hiatus in growth is persisting and unemployment remains at intolerable levels. As the only explanation, the Commission continues to rely on the vague concept of lack of confidence. And yet citizens are experiencing day by day the economic horror which provided the recent title for a famous French bestseller.
As far as we are concerned, the economic situation in the Union exhibits significant deficiencies in crucial aspects which need to be stressed. Despite high levels of saving, investment is far lower than in the past. Public investment is becoming the major casualty of the process of achieving healthy public finances in the various Member States.
So we propose that when public deficits are judged excessive a fundamental distinction should be made between current expenditure and capital expenditure, between deficits to finance current spending and deficits to finance investment.
Even more worrying is our lag in research and development, especially in terms of the information society. A European strategy must be implemented urgently to reap the existing benefits of an economic area integrated at Union level. Action continues to be dispersed because this is an area where public authorities have a determinant influence, but each State is operating on its own account, coordination is extremely limited and direct action by the Community institutions is minimal.
In conclusion, we socialists think it is wrong to reduce all economic policy to the objective of ensuring a healthy economic framework. It is also necessary to commit ourselves to active policies for employment, training, investment, research and development strategy, a more active supply side policy, and management of aggregate demand as well. We hope these considerations will be taken into account when the broad guidelines for economic policy are drawn up.

de Silguy
Mr President, ladies and gentlemen, allow me first of all to address Mrs Randzio-Plath who has demonstrated or tried to demonstrate, in her absolutely brilliant exposé, that Spring is still very cool. Undoubtedly she was alluding to the ambient temperature this morning, in the streets of Strasbourg. Perhaps like me after dinner, she might have realised that the temperature had warmed up. That leads me to think that just because Spring is cool it does not mean it cannot be followed by a beautiful Summer and a rich harvest in the Autumn.
But to take in a good harvest, Mrs Randzio-Plath, you also have to put in some good work. Meteorological conditions do not explain everything. That, definitively, is what we wanted to do with the Annual Economic Report, because the report contains all the elements needed for a strategy for an overall economic policy, not only on convergence and economic and monetary Union, but also for growth and employment, which are two themes I would like to tackle now.
Permit me, nevertheless, to make a parenthesis, directed at Mr Donnelly - who, sadly, is not here to hear my reply, which you will transmit to him: he asked for the Annual Economic Report (AER) to be the subject of publicity, a greater public explanation. Personally, I find this an interesting idea. We are going to think about it and I think there are several ways to proceed. First of all, we can think about having the next rapporteur, for the next AER, named earlier and we can hold preparatory discussions with some parliamentarians before publishing the Annual Economic Report. We can also think about holding a public debate with economists, research institutions, journalists and parliamentarians. I am ready to consider all of these ideas and work on them. That is how I would reply to Mr Donnelly.
I come now to my two subjects - which I would like to stress - so as not to waste your time. First of all, growth. I think that many of your questions, in this hemicycle, have revolved around the following question: how can growth be improved?
First of all, I would say that growth - perhaps regrettably - cannot be decreed. It results principally from sound economic foundations. I am sorry, Mr Willockx, but public deficits have never created jobs. If they did, we would be in a position of overemployment. You have accused us of seeking, above everything else, excessive stability, to the detriment of employment policy. What I say, what I think, is that a sound economic policy is a prerequisite for the constitution of an economic framework favourable to growth, even if - and here I agree with you - it does not make it possible to sort out the unemployment problem entirely, and that these policies must be complemented by other policies.
Why are economic policies orientated towards stability necessary? Because they make it possible to ensure medium-term growth, which will be drawn along by demand and supported by investment.
First of all, growth must be supported by demand and on this subject I would like to stress this: that the Commission does not dispute the fact that demand must accompany growth and that the current deficiency in internal demand explains in part the caution of the current renewal. I would remind you that growth was 1.6 % in 1996 and that it will be between 2 1/4 and 2 1/2 % in 1997. But artificial support for demand, which with a budgetary expansion or an increase in wages which was too rapid would threaten the foundations, would be counterproductive and therefore short-lived. Why? Because gains in productivity are an important driving force of growth and because the reduction in relative prices, in sectors in which productivity is showing a strong increase, makes it possible, indeed, to increase demand for the purchase of goods and services in sectors in which productivity is increasing more slowly and in which, all the same, jobs are being created. An attempt has been made to demonstrate this on page 34 of the AER.
As your Assembly recommends, this process is facilitated by the suppression of obstacles to innovation and by a policy of research and development which is better directed. But I would add that demand is picking up again in Europe today, and on a sound footing. Exports have been the first support for this. They should now hand over to private consumption, which should grow by 2 % in 1997 and 2.5 % in 1998. These improved prospects for demand should also stimulate investment.
I come now to my second point, that is growth supported by investment.
The Commission shares the concern of your Assembly, Mrs Randzio-Plath, on the relative stagnation of investment in Europe. It is true that, up to now, the renewal in investment worldwide is still timid. However, we can already see an improvement in performance of investment in machinery, even if the construction sector is still slow to react. I think, and this is not to demonstrate excessive optimism, Mr Ribeiro, that all of the elements are in place for a more open renewal in business investment, which represents all the same 85 % of investment worldwide, particularly thanks to an appropriate return on capital invested and a more relaxed policy mix.
However, more specifically, concerning public investment, I recall that the Commission has always insisted, including in the Annual Report for 1997, that public investment is preserved. Indeed it is an important factor for long term growth. The Commission has therefore constantly lent its support to community investment projects, beginning with the trans-European networks.
That is what I wanted to say to you very quickly on growth, an essential condition for the creation of jobs.
Now, very briefly, because time is limited, I will say a few words on the second question, that is the creation of jobs: how can we facilitate the creation of jobs in Europe? On this point, too, the 1997 Annual Economic Report contains some important analyses and recommendations regarding the employment market. These measures, may I remind you, fall essentially, in this area, under national competence. Mr Langen has quite rightly highlighted this, moreover. The Commission therefore invites Member States to assume their responsibilities in the matter.
I would very quickly like to tackle two problems - the employment market and wages policy - which have been mentioned within these walls, this morning and this afternoon.
The employment market, first of all. The most active policy on the employment market should be pursued. Indeed, during the period which followed the first oil crisis, the high level of labour costs, wages and non-wage costs, and in some cases, the existence of rigid regulations regarding job security, reduced the interest in labour as a factor of production. To remain competitive, businesses continued to substitute capital for labour. However, employment markets in the European Union adapted progressively and this has led to a considerable improvement in profitability.
Mr Berthu and Mr Lukas, and also, to a certain extent, Mrs Randzio-Plath, raised the question of investments for rationalisation - these are necessary to safeguard competitivity, but may destroy jobs - as opposed to investments for expansion, which increase our capacity for growth and therefore employment. The Annual Economic Report analyses these problems in relation to the substitution of capital for labour. What we need is to add many more investments for expansion, which create jobs, to the investments for rationalisation. The conditions of development, at that point, become much more favourable. But the effects of the employment intensification process of growth are not immediate. The Commission recommends therefore that the capabilities of employment markets should be improved, their capability of adapting to economic changes, in particular by modernising the organisation of work and by increasing geographical and professional mobility.
The Commission is convinced that it would be desirable to implement pragmatic solutions to broaden the scale of labour costs, according to qualifications and according to region and, up to a certain point, according to sector. This could be done, for example, by lowering non-wage costs, by lightening the tax burden on the wages of poorly qualified workers - I join with what Mr Fourçans said along these lines - and by instituting first-time employment wages for disadvantaged workers. But this adaptation of the labour market also involves a certain wage differentiation, which would have to be agreed between social partners.
To judge from your draft resolution, if I have understood correctly, a certain wage differentiation between regions can only favour the downward revision of wages, and can only result in new relocations. Well, no, the Commission does not share this point of view. I can reassure Mrs Lis Jensen and Mr Wim van Velzen. Exactly the opposite! Provided that they are based upon the different levels of productivity according to region, these differentiations would not lead to any business relocations from one region or from another. On the other hand, they would lead to the creation of new business activity and new employment in areas with high levels of unemployment.
Allow me, Mr President, Ladies and Gentlemen, in conclusion, to underline, and to recall, the fact that the Annual Economic Report responds to an overall coherent strategy of growth, employment and convergence which is developing in Europe. I give as proof the short term reduction in real interest rates in Europe, by nearly 500 basis points since 1993, that is a historical reduction of 70 % - I give as proof also a large, and probably more meaningful, reduction in long term interest rates.
The debate we have taken part in today will enable us, Mr President, Ladies and Gentlemen, to refine our analysis for the development of the major orientations of economic policy, which I will come and present to you on 23 April, that is, the very day on which the Commission will adopt them. You will be informed in real time and, then, on the basis of this analysis, we can take the debate on European economic policy up again.

Randzio-Plath
I have a question to put to you, Commissioner. You referred, amongst other things, to the formulation of the broad guidelines of economic policy. Can you tell the House whether you are prepared to anticipate the debate on the formulation of the broad guidelines of economic policy by letting Parliament know which aspects of the resolution it adopts tomorrow will be incorporated into those guidelines, so that an exchange of views between Parliament and the Commission can take place in good time before 23 April?

de Silguy
Mrs Randzio-Plath, I have only two concerns on this matter: to respect the Treaty and to strengthen the collaboration between your Assembly and the Commission. First of all, I consider that the intense, active debate which has taken place on the Annual Economic Report already gives us a great deal of information. I am ready, nevertheless, Mrs Randzio-Plath, if you wish, to organise a working group between a delegation of parliamentarians and my departments, before we have the Annual Economic Report adopted by the Commission. To respect the Treaty, I am obliged, however, to make it a meeting of an informal nature.

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

Support facility for balance  of payments
President
The next item is the report (A4-0105/97) by Mr Metten, on behalf of the Committee on Economic and Monetary Affairs and Industrial Policy, on the report from the Commission to the Council and the European Parliament (COM(96)0545 - C4-0588/96) - review of the facility providing medium-term financial assistance for Member States' balances of payments - Council Regulation (EEC) No 88/1969.

Metten
Mr President, my report looks at two questions: firstly, whether the existing funding facility for balance of payments problems should continue beyond the start of EMU on 1 January 1999; and, secondly, whether this kind of assistance for payment problems might not also be useful for Member States in the Economic and Monetary Union which experience national difficulties.
To begin with the first question, the funding facility for balance of payments problems has proved its usefulness in the past. It has been useful for the countries which have had recourse to it, because they obtained cheaper loans than they could otherwise have done themselves, while the other Member States gained stability on the internal market and were able to obtain repayment guarantees through the conditions attached to the loans. Because the loans are usually paid in tranches, the implementation of the conditions designed to help economic recovery can be closely monitored.
The important thing with this facility, therefore, is that both the recipient Member State and the Union as a whole benefit from it. The total costs are paid by the beneficiary countries, and the only risk the Union takes is that the loan cannot be repaid, which has never yet happened. Should this facility now be abolished when EMU begins on 1 January 1999? Parliament's Committee on Economic and Monetary Affairs recommends not. Not all the present Member States will be joining the EMU straight away, and the 'pre-ins' and the 'outs' initially outside the EMU might well encounter balance of payments problems. So the facility should certainly continue until these countries join the EMU.
But even once all the present Member States have joined the EMU, which might be the case in 2002, there will still be a clear need for this instrument. From 2002 onwards, the first Central and Eastern European countries will be joining the EU, and at least one, Hungary, has already indicated that it will certainly need a few more years before it is ready for EMU. So there will be a period when countries which have joined the EU but not the EMU could well encounter balance of payments problems. It is thus a useful instrument which should certainly not be abolished just yet. This brings us on to my second question.
Would not this facility, which operates via the capital market in the form of loans guaranteed by the Community, be a useful one during the third stage of EMU, particularly for countries facing national difficulties? The Maastricht Treaty expressly provides for this possibility in Article 103a(2), but no action has yet been taken under it. One of the possible problems that may result from EMU is that Member States are less able to cope with national upsets, in other words shocks which affect one country and not the others. Exchange rates will no longer be an option, and the capacity of the budgets to act as shock absorbers will be restricted by the stability pact. A positive instrument which could help Member States out of an unexpected recession would certainly be very useful, and there is no reason to fear that Member States would be less disciplined if such an instrument were available. It must be approved unanimously by the Council; there are strict conditions attached, and all the costs are borne by the beneficiary country.
A further factor is that the stability pact, which expects governments to have healthy finances that can cope with less serious national upsets involving less than a 2 % reduction in the economy, is likely to make things worse rather than better for the Member States concerned, since they then face payment of a fine or a deposit. Mr Zalm, the President of the ECOFIN Council, compared the stability pact to an atom bomb which is there as a deterrent rather than to be used. Or as President Santer said, it is like a pre-nuptial contract: never intended to be implemented. That being so, an instrument which served the same purpose but could actually be used would be extremely valuable. I would therefore call on the Commission to undertake to develop a proposal under Article 103a(2) and to forward it to Parliament and the Council.

Herman
Mr President, my dear colleagues, will it be necessary to extend the financial support facility for balances of payments beyond the date set for the entry into monetary union? As Mr Metten has said quite rightly, as far as the first years are concerned in any case - the years during which not all Member States will be members of the monetary union - this facility may still be of some use.
However I will make a distinction, which Mr Metten did not make, which consists in putting on the same footing those countries which would like to join the monetary union, but are not in a condition to do so at present, and those countries which are in a condition to belong but refuse to do so. It is obvious that if one wishes to encourage Member States to remain outside the monetary union, it will, of course, be necessary to apply advantageous conditions of the aforementioned facility to them. That is not, I think, the vision we have. I do not think it is the vision of Mr Metten either, because it is in all our interests that the extent of the internal market should coincide with the territory of monetary union.
From that time, we are not going to give those who fulfil the conditions and who do not wish to join - essentially for political reasons - the additional gift of saying that they will benefit from our solidarity if they have any problems. We are neither masochists nor sadists, but we must at least keep our feet on the ground. If we create a structure together in which we would like everybody to participate, we are not going to encourage those who remain outside it to remain outside it! Personally, I am not going to follow Mr Metten down that path.
The other question which arises is this: will it be necessary, as Mr Metten suggests, to design a facility of this kind and maintain it when monetary union is complete and everyone belongs to it? Indeed, he says, there will still be situations in which Member States suffer shocks which will require that they are helped out. That is a case which will become very limited. Why?
Because, when you have a large market, a single currency and, in addition, not only criteria of convergence but also stability pacts, it is obvious that most of the shocks which will continue to occur will be shocks from outside. Internal shocks will be reduced, it seems to me, to very little. They will be accidents which may result either from natural disasters, or from political disasters such as prolonged general strike. It is permissable to imagine similar situations, but in this case, the appropriate technique does not seem to be that which Mr Metten suggests.
That is why I am expressing reservations on the final part of his exposé, and I wonder if it is necessary to imagine, on the basis of Article 103, paragraph 2, a facility similar to the current facility, but intended to sort out the problems of budgetary adjustment of Member States. I do not think so.
I think that, to confront this situation, it is more sensible to play with the few elements of flexibility which exist in the stability pact because, according to his analysis, Mr Metten records that as being among the problems which will have an influence on budgetary balance. Now, as regards problems of budgetary balance, it is not a facility intended for the balance of payments which should be used: it is another facility. And I am quite ready to support the idea that something should perhaps be planned. Whatever happens, we have plenty of time because this problem will not arise until after the year 2000.

Katiforis
Mr President, the report by Mr Metten brings a most serious issue to the forefront of our discussions: the stabilization of the European economy during and after the introduction of the single currency. Although stabilization is an important aspect of economic policy in the contemporary economy and in the control of finances, very little is said on the subject at the official level. So we should be grateful to Mr Metten for his very important contribution and for endeavouring to draw our attention to the subject.
You will all be aware, ladies and gentlemen, that currency stability is a prerequisite for participation in the exchange rate mechanism and, of course, for participation afterwards in the single currency venture. Although at this moment the mechanism allows fluctuations of up to 15 % from the central parity, it is accepted that the countries which are hoping to move to the euro are striving, unofficially, to maintain much more stringent parities, and already some of them have begun to face balance of payments problems and tensions. The crucial thing that should be borne in mind now is that it cannot be excluded that those difficulties may become worse when the sheep are separated from the goats, that is to say when the countries which join the euro are separated from those which stay out. That will be the tricky time, and at that time the stabilization mechanisms must be strengthened and not removed. We must not follow the Treaty and terminate a stabilization mechanism which could be important for those who stay out. Stabilization problems will continue to exist within the euro system as well, because that system will be composed of economies with varying productivity levels, and it is common knowledge that the existence of such disparities in productivity levels can lead to internal shocks which it will be possible to counter only by budgetary measures in the federated states. Mr Metten's proposals are flexible on this point. They use whatever is in the Treaty and I feel that they deserve our support.

Cox
Mr President, on behalf of the Liberal Group I want to note the elements of agreement and disagreement with the emphasis placed by Mr Metten in his analysis.
Firstly, in the area of agreement, we share the rapporteur's view that this balance of payments facility should continue beyond the establishment of the Euro in Stage III, but only for those states that are in a pre-in condition. I agree with Mr Herman. We have got to look seriously at what we owe in the way of solidarity to those who could qualify but clearly choose politically to stay out.
We do not owe them solidarity. They do not show us solidarity. But in so far as Mr Metten agrees on this and suggests it should continue for pre-ins, I accept that because that is what the Treaty says. Article 109k(6) provides for precisely such a possibility. However, when Mr Metten, by the back door - and that is what this is - recycles a balance of payment facility into some kind of a stability pact accelerator/decelerator model to deal with cycles in the economy, I have a problem. I do not like dealing with so serious an issue through the back door.
The difficulty is that it is a back door mechanism because the balance of payments facility for those states inside the Euro is clearly provided for; in the Euro it will cease to exist. Why? Because the balance of payments constraint and problems will cease to exist. That is perfectly logical. So if we want to have a discussion about how we conduct a balanced economic programme to cover various exigencies as they arise, let us have it up front and openly. I do not like the back door. I take note of the novel, innovative suggestion of the rapporteur, but I do not support it through the back door.

Castagnède
Mr President, very briefly I would simply like to register the complete agreement of my group with respect to the proposals made by Mr Metten as regards both, on the one hand, the maintenance of the current support facility for balances of payments for the benefit of States which will be unable to join the economic and monetary union from 1 January 1999, and, on the other, the creation of a community loan instrument which would make it possible to contribute in a slightly more flexible way to the absorption of macroeconomic shocks which could occur once the third phase comes into effect.
Indeed, we think that it is essential to complete the monetary instruments and add to them other instruments for economic guidance. We still do not know if there will be a pilot in the cockpit during the years to come - we do not know today - but at least, with Mr Metten's proposal, we are assured that there will already be a first control lever.

Blokland
Ladies and gentlemen, Commissioner, the Commission document and Mr Metten's report look in detail at the question of whether the balance of payments facility should continue after the start of EMU, and the rapporteur is rightly concerned about how Member States which have joined the EMU will cope with national upsets. And what do we mean by national upsets? Natural disasters, mismanagement in a particular economic sector or, in more general terms, an economic crisis in a sector which is vital to the Member State concerned.
He concludes that the defence mechanisms against national upsets come under pressure from EMU, but he is reassured by the fact that Member States will probably be slightly less susceptible to such upsets anyway. That is still unconfirmed speculation. Of the examples I gave, it is difficult to see why those types of sectors should be any less susceptible. The problem is that EMU has no automatic stabilizers. The stability pact will continue to have a destabilizing effect as long as there is no budgetary equilibrium, since Member States with large deficits are required to pay substantial fines.
Little help can also be expected from the ECB, whose primary objective is price stability. That is all well and good, but national upsets are almost certain to bring higher unemployment and higher interest rates. I would remind the House of what the Bundesbank did after the monetary union between East and West Germany. To avoid the risk of inflation, it simply cut off the money supply. Inflation was stifled, but interest rates and unemployment soared at the beginning of the 1990s.
In the period between November 1991 and March 1995, there were ten occasions on which a Member State had to devalue its own currency because it appeared too high against the German mark. Basic economics indicated that this was the right thing to do, and you have to listen to basic economics. That is the strength of exchange rates: they can prevent unemployment and migration by cutting their coat according to their cloth. Balance of payments assistance is an artificial device which may help efforts in the short term, but cannot offer a structural solution if that is what is required. The problem we are facing is not an economic, but a political one.

Willockx
Mr President, ladies and gentlemen, there are two points I should like to make. Firstly, the state of a country's balance of payments is one of the fundamental factors which determines the value of its currency. If we are soon to enter the third stage with some of the Member States in and some out, or out for the time being, then it seems logical that the existing balance of payments support facility should remain in place, if only to help those countries whose balance of payments could, as Mr Katiforis said, come under even greater pressure once the single currency is launched, to show solidarity with them and to help them towards convergence.
Secondly, the road to convergence, Commissioner - and this is not intended as a criticism, it is simply a statement of fact - has a number of deflationary effects. I can see this in my own country, which has been making tremendous efforts to achieve convergence over the last few years. I have always been in favour of making these efforts, but they have tended to cause deflation. In other words, there is a price to pay.
I think that Mr Metten has come up with a very important idea, that Community loans should be granted not to help countries cope with national upsets, Mr Herman, but to deal with collective shocks as part of an anti-cyclical policy that may yet need to be introduced. So it could be vital for the Commission actually to expand the Community loans facility, and I would urge the Commissioner to act on this. The Treaty makes provision for it, and I think it could become an important addition to the traditional methods used in monetary policy.

Peijs
Mr President, the facility we are discussing today has proved its worth on eight occasions since 1974, four times for Italy. The assistance provided makes the markets more confident that a particular country can improve its financial situation. The PPE Group therefore agrees with the Commission that it is likely to continue to play a useful role during the transition to the third stage of EMU, when balance of payments problems could still occur despite the progress made towards meeting the convergence criteria and the continued integration of the markets. It could even continue to be useful for those countries which are unable to join EMU in 1999, the pre-ins and the new members. For the countries which have opted out, the facility should be available only until they meet the criteria: beyond that point, our solidarity with them should extend as far as their solidarity with the rest.
However, the PPE Group feels that the facility should not be available for Member States which join the EMU, since it will not encourage the necessary discipline and stability, and will undermine the stability pact agreed last year in Dublin. That is why we have tabled an amendment to Mr Metten's report, which we have toned down in the hope of reaching a compromise, so that the facility is not an alternative to the stability pact, but merely offers a basic level of support.
The fact that having a financial assistance facility for EMU countries is neither necessary nor desirable is also clear from the fact that the stability pact itself makes an exception for countries with excessive deficits caused by exceptional and temporary problems, such as an unusual event beyond the control of the Member State which has a very negative effect on its financial position, or a very serious economic downturn. In both cases, the national governments can concentrate on reviving their economies, without having to worry about sanctions being imposed under the stability pact.
In conclusion, my group would urge the Commission to consider, when it makes its new assessment of the facility, what provision the stability pact also makes for the EMU countries. The facility cannot be an alternative to the pact, nor should it really be able to provide assistance for countries in difficulty, since this is already provided for in the pact. The PPE Group therefore intends, as Mr Herman said, to vote for the resolution, but only in order to support the Commission, and we leave Mr Metten to be responsible for the substance of the report.

de Silguy
Mr President, ladies and gentlemen, Mr Metten's report, on behalf of the Committee on Economic and Monetary Affairs and Industrial Policy, on the facility providing medium-term financial assistance for Member States' balances of payments, justly highlights the usefulness of this loan facility.
Your rapporteur raises two different questions, which the debate has really brought to light. The first question relates to the maintenance, for the 'outs' - the Treaty's euphemistic name for those who will not be in the Euro area at 1 January 1999 - anyway, the maintenance, for the 'outs', of the instrument of assistance for balances of payments provided for in Article 109 H after EMU has come into effect; the second question relates to the implementation of financial assistance provided for by Article 103 A, paragraph 2, for a Euro State which is in difficulties.
Very quickly, I will make a distinction between these two elements. Regarding the maintenance of the current instrument, the Commission - and you must grant me this - can only go by the Treaty. Now, in accordance with Article 109 K, paragraph 6, of the Treaty on the European Union, the Commission recalls the fact that the 'outs' will continue to benefit from this financial support facility for balances of payments provided for by Article 109 H. In 1998, the Commission will, therefore, proceed to re-examine the current facility. To do so, we will have to wait until decisions on the passage to the third phase have been taken and the names of the countries who will participate in it are known. This will be done at the end of April/beginning of May 1998. We will have the chance to talk about it, I think, in a little while in the Committee on Monetary Affairs.
So what the Commission will have to do will be to check whether the regulation currently in force, that of 24 July 1988, still applies, and secondly, whether the line of 14 million Ecus, let us call them Euros, written into the Community budget is still appropriate. As you wish me to, I can assure you that the Commission will inform your Assembly of its work as soon as possible, after it has carried out and concluded its thinking on this.
The second problem is that of financial assistance for a State within the EMU. Mr Metten's proposal calls up two comments from the Commission. Firstly, Article 103 A, paragraph 2, pursues a different objective to that of Article 109 H. Indeed, it institutes an exceptional facility which should permit a Member State which is, I quote the Treaty: ' in difficulties or is seriously threatened with severe difficulties caused by exceptional occurrences beyond its control' to confront them. It cannot, therefore, be linked to the stability and growth pact. This pact is permanently in application and I will remind you that, by its preventive aspects, it aims to give Member States budgetary room for manoeuvre which is sufficient to confront difficulties which are not of an exceptional nature.
The second comment is that Article 103 A, paragraph 2, was not created to respond to balance of payments crises, but to really exceptional events, for example earthquakes, tidal waves, or comets which might crash into Member States, the list is not exhaustive, of course. However, on the occasion of next year's review of this loan facility for balances of payments, the Commission, with the Council and Parliament, will look at how to implement the provisions of Article 103 A, paragraph 2.
I cannot give you any solutions today. I can, however, tell you that on that occasion we will have to examine four questions. The first question concerns the appropriateness of a Community regulation to respond to events of an exceptional nature. Would it not be more appropriate to give the Council the ability to make decisions on a case by case basis?
The second question relates to the definition of instruments covered by Article 103 A, paragraph 2. They are not solely concerned with loans. The notion of Community financial assistance - that is the Treaty's expression - does not, indeed, exclude genuine budgetary interventions.
The third question concerns the regulation of application of Article 103 A, paragraph 2.
The fourth question, and I can assure you I will stop here, concerns the possible means of financing of this financial assistance. These have to be defined.
In conclusion, because I do not want to prolong the debate on this point, I am anxious, Mr President, to thank you and thank the Parliament for its suggestion, which opens a first track for the application of Article 103 A, paragraph 2 once the third phase on economic and monetary union has come into effect. I can assure you that the Commission will not fail to make the most of this facility when it re-examines it next year, and that we will have the chance to talk about it again.

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

Competitiveness of European industry
President
The next item is the report (A4-0113/97) by Mr García-Margallo y Marfil, on behalf of the Committee on Economic and Monetary Affairs and Industrial Policy, on the communication from the Commission (COM(96)0463 - C4-0622/96) on benchmarking the competitiveness of European industry and the Commission Staff Working Paper concerning a European Quality Promotion Policy for Improving European Competitiveness.

García-Margallo y Marfil
Mr President, Mr Commissioner, the Commission Communication to Parliament and the report I have the honour of presenting to you have an obvious point of departure: European industry is currently less competitive than American industry and Japanese industry. As proof of this statement, the Commission Communication presents the loss of market share that European industry is suffering, especially in the emerging markets - the most vigorous markets - while our main competitors, America and Japan, are maintaining their position.
The Commission Communication seeks the reason for this loss of competitiveness. And to find that reason it uses the technique of comparison - or benchmarking - between European industry and its competitors. Benchmarking can be applied at various levels: it can be used to compare systems, framework conditions, and structural factors which are the responsibility of the public authorities; it can be use to test the efficiency of industry as a whole, or some of its sectors or subsectors; and finally some - or all - of the companies that compose them.
Although all these levels of comparison must concern them, it is obvious that this Parliament and the public institutions should concentrate their analysis on the framework conditions, the responsibility of the public authorities. And to complete what may be called this 'methodological' or 'introductory' stage, I would say that the Commission starts from the sensible position that competitiveness is not an end in itself, but a means of obtaining better living standards and higher levels of welfare. And this line of thought, which coincides with what may be called 'revived capitalism' , seeks to define standards of living by using criteria which are non-quantifiable and nonmeasurable, but which have an incidence on the welfare of the citizens. Sustainable development is one of these and has been emphasized by various groups.
The points the committee had to examine, and which this report centres on, basically cover four areas: services and infrastructure, as they affect competitiveness; the labour market, social legislation and training of workers; capital markets; and finally, the position of research and development in European industry, by comparison with its competitors.
As regards services, there are three basic findings: the purchase of services absorbs 20 % of the profit and loss account of European industrial companies; European services, which affect competitiveness, are dearer than services in the United States and Japan; thirdly, there are sectors protected from competition and therefore less efficient. And starting from these statements - which I agree with - two measures are advocated: liberalization of services - acceleration of the processes of liberalization already in progress - and opening up to competition - the opening up of those markets in service sectors that are still protected.
In terms of infrastructure, there are two findings in the report: first, that the infrastructure stock, obviously, affects the competitiveness of industry and, secondly that it is desirable to reduce the imbalances between the various regions of the Union to promote their competitiveness and access to the favoured areas.
Starting from these findings, the report and the Communication it deals with come out in favour of benchmarking between our levels of investment and American levels of investment, of seeking formulae for cooperation and collaboration between the public sector and the private sector to finance investment in these difficult times and, thirdly, of encouraging all Union institutions to reduce differences in infrastructure between the various regions, making the principles of cohesion and solidarity effective.
There is just one finding about the labour market: our rates of employment and productivity are lower than those of our competitors and this translates into our lesser capacity to create jobs. So the stress must be on active measures of training and mobility rather than passive measures geared to mitigate the consequences of unemployment: a review of taxation on earned income which act as a brake on entry into the labour market, especially in the lower bands; the idea that stability and flexibility are not opposing concepts; and, finally, greater recognition of workers' qualifications to make the free movement of workers effective, one of the remedies for coping with the crises of imbalance we were talking about just now.
I end by mentioning the capital market: the restrictions in this market - basically on mortgages, pension funds, etc. must be brought to an end. And an observation on R+D: our rate is lower than the American rate, the private sector effort is lower here and the American technique of tax incentives achieves better results than the aid we use here.
Thanks to all those who tabled amendments, almost all of which I have accepted, and to the committees which have worked on this report. I believe it can be of use to the Commission in pursuing a technique which we would like to see encouraged at all levels.

Wolf
Mr President, ladies and gentlemen, benchmarking is set in the context of both the drive for competitiveness and the pursuit of a new model of sustainable development which is more in keeping with the times. And in this respect, it should be clearly borne in mind that while determining the level of competitiveness is a market method for gauging efficiency, the economical use of resources and the sure achievement of goals, it is only an indirect method. In other words, we must not fall into the neoliberal trap of believing that market indicators are the be-all and end-all, and that the most reliable expression of competitiveness is permanent export surpluses. On the contrary, there must be mutual benefits, as I am sure Mr Bangemann will agree. A world in which everyone has permanent export surpluses is impossible. It is therefore a question of countries benefiting each other in the long term, and in this sense, the drive for competitiveness without cooperation is misconceived.
It is important to apply the same criteria to public services and the production of public goods, since they also require the economical use of resources and the sure achievement of goals. And it is important too for the modern techniques of quality management to be more widely applied.
If we regard benchmarking not as the illusory replacement of policies with self-management of the economy, but rather as a methodical attempt to achieve qualitative goals by means of organized action, then we can begin to refer back productively to the Delors White Paper - in which the two sides of the argument were still unbalanced - and actually use benchmarking to achieve the methodical renewal of policies. In this sense, Mrs Schörling, on behalf of whom I am speaking, is calling for the adoption of a benchmarking method for employment and environmental policies as well as for sectors of industry, with the aim of speeding up the monitoring and diffusion of best policies and practices that reinforce sustainable development.

Murphy
Mr President, I would like to thank the rapporteur for his report and also the Commission for its proposals. This is a report which is of genuine interest to a lot of the small and medium-sized enterprises throughout Europe and certainly to smaller companies in the area I have the privilege to represent - towns like Wolverhampton, Dudley or Halesowen in the industrial West Midlands. I must stress that for this process to be successful it must be inclusive. We must involve all the interested parties. If people feel threatened by the process, it simply will not work: we need to involve everybody in a partnership. If we do that then benchmarking can be a real opportunity for us to increase the competitivity of our businesses, increase profits in our businesses and, most of all, increase the job creation potential of our businesses.
I should just like to draw attention to three or four key paragraphs. Firstly, as paragraph 5 states, it is important that we look at specific mechanisms to help our small companies make the most of benchmarking. Secondly, I should like to see the Commission give us some information as to why certain sectors of European industry actually outperform their counterparts in America and Japan. We ought to look at our own successes and learn from them and, similarly, learn from the successful cases of countries in Europe which have lower unemployment rates compared to our main competitors, Japan and America.
It is also important that Parliament itself be involved with the tripartite visits which the Commission organizes to America and Japan to look at benchmarking to see what we can learn from other countries. I hope the Commission would accept that as a positive development. Finally, in Paragraph 14, Parliament calls for the Commission to look at the quality of our managerial skills in Europe. Much of the time it is not the fault of the workers but the weakness of our management structures. We need to look at that and here benchmarking would be very useful.
If we look at this as a partnership approach involving all the social partners, it will be successful and will be a positive asset to us in our ability to create a competitive Europe.

Peijs
Mr President, a few weeks ago we read headlines in all the newspapers about how far Europe was lagging behind America and Japan. The report held our attention for a week or so, but now Europe's poor competitive position in relation to the other OECD countries and a number of improving Asian countries seems to have slipped into the background once again. The fact remains that even our exports to the OECD countries have fallen since 1985. Now, however, we have battened down the hatches and put our noses to the grindstone - and that is just as well, since no one else is interested. Investors are looking anywhere but Europe. We have too many rules, too much industrial unrest, we are not flexible enough, and our decision-making procedures are much too long. In other words, all we do is talk, not act. In the Netherlands, an investment project takes 26 years to get from the drawing-board to the official opening - 26 years. What firm would want to do that? At international business meetings, the word Europe is only ever mentioned as an example of how not to do things. We are currently obsessed with the convergence criteria and being tenths of a percentage point above or below them. Why on earth are we bothering about that? The German mark has been the anchor currency up to now, and even if Germany's deficit is 3.5 % and the euro is not introduced, the mark will go on being the anchor currency for the time being. We are fussing about it all unnecessarily, and every day we are undermining the confidence of the major financial markets further still. I say that the mark will remain the anchor currency 'for the time being' quite deliberately. The international community sees Germany as in crisis. At an important meeting of the Global Forum, a senior official from the Deutsche Bank gave Germany three years to carry out the necessary reforms, otherwise it would not be able to join the EMU.
Workers and trade unions should 'benchmark' the productivity, flexibility and employment of Germany against those of their competitors. The miracle is no longer working in Germany: in fact, it is not happening at all.
It is clearly a great mistake to label as 'social' an old-fashioned social market economy which dates from the time when Europe and the United States led the world. Those days are gone, and a policy that still has its roots there is not sustainable. It does not suit all conditions and is actually asocial rather than social, as we can see from the 4 million unemployed people in Germany and the almost 18 million in Europe as a whole. And the Netherlands, which observers generally regard as doing better than average, is classified by the OECD as having a major nonparticipation problem. The difference is that the Dutch economy is growing and the Netherlands has gradually made its system a little more sustainable, but that is the only difference. Mr García-Margallo Marfil's report is an excellent one, since relevant comparisons could well open Europe's eyes. Not just to the fact that our share of the market is declining: of course it is. America's share is also falling. Our share of the world market can never grow as quickly as the market itself, and the newly industrialized nations are too big to enter the world economic stage unnoticed. We are a mature economy and we must compare ourselves with other mature economies, such as the United States. That is what benchmarking is all about: comparing comparable quantities in order to find out why one is doing better than another. And in terms of maturity, we can well compare ourselves with the American economy. The question then is why should employment be growing in the US, whereas here it is not just stagnating but disastrous?
Of course, there are demographic factors which are not in Europe's favour, but to take just one example, why are we still just talking about continuing education for workers, when the Americans have already put it into practice? Perhaps we should be sitting down when we come to see the real results of benchmarking, otherwise the shock might knock us over.

Giansily
Mr President, my dear colleagues, the report on the promotion of benchmarking - for which I would prefer it if we spoke, in correct French, about location and standardisation of performance - has the support of our group.
We consider that the Commission's document is heading in the right direction when it stresses the three possible levels to the subject, that is, level of performance in relation to framework conditions which should permit the evaluation of the capability of Europe to attract as a production zone because of costs, infrastructure, skills and innovation, that of sectors of activity which should permit the measurement of European industry's capability to adapt to globalisation and, finally, the level of businesses, which comes under their own responsibility but for which Community action could be useful to SMEs and could contribute to harmonisation of the methods employed. All the same, it is advisedly that the Commission proposes, on the basis of a partnership between industry and the Member States, the establishment of a work programme for 1997 from pilot projects intended to test the validity and the feasibility of the application of benchmarking at the level of the European Union.
Our group gives a favourable welcome to the quality report of Mr Garcia-Margallo y Marfil, as to all initiatives aiming to improve the competitiveness of European industry. However, we consider, for our part, that such an activity should continue to be principally the responsibility of the private sector as far as industry is concerned and that it should be approached with caution at the level of the framework conditions.
Indeed, we would have a few reservations about the benchmarking of framework conditions if the consequence of it was that matters which are essentially matters for subsidiarity were analysed at Community level, that is, the competence of Member States, such as the organisation of public bodies in their relations with industry, as is the case with energy policy for example.
We also think that it is difficult to make a useful comparison of macro-economic factors without taking account of the individual environmental, economic, social and cultural policy of each State. We also think that it would be more sensible rather to give greater importance to the benchmarking of the industrial sectors, and we think that there is everything to congratulate, in this respect, in the work undertaken by the Dutch President in the electronics sector.

Kestelijn-Sierens
Mr President, Commissioner, ladies and gentlemen, I should like to congratulate the rapporteur on his report. He is right to say that we can only maintain our social model and thus our standard of living if we can rely on an industrial sector that is in a position to compete. I would remind you that the European Round Table of Industrialists has been trying its best for over three years now to put the competitiveness of the European economy on the political agenda, and the interaction between competitiveness, employment and growth was explained in the Delors White Paper.
I am also delighted that the Dutch presidency is making benchmarking one of its priorities. Benchmarking employment is probably the most urgent task currently facing Europe and our national governments. Conditions will have to be made much more favourable if our economy is to become more competitive, and I think we have a good deal to learn here from the United States or even, closer to home, the Netherlands, both of which have managed to expand their economies and create jobs.
Government at all levels must constantly test out the business climate and policy in the countries with the best performance and then take whatever steps are necessary, such as making the labour market more flexible, liberalizing government services, investing in human resources, promoting research, and developing and pursuing a quality-led policy. Only then can we hope to bring about lasting improvements in the competitiveness of our industrial sector and, in the long term, our standard of living.
The Liberals support the Commission's plan to put forward a benchmarking programme, in close consultation with the industrial sector and the Member States, in order to monitor progress in key areas. I would also point out, however, that the SMEs must not be forgotten here.
Finally, we are also looking forward to having the results of the pilot projects that the Commission has launched, which the Industry Ministers are to examine on 24 April.

Katiforis
Mr President, Commissioner, ladies and gentlemen, I wish to say at the outset that I am in favour of benchmarking and that I shall be voting for the report. I say that because I would like to avoid wasting time on praise and instead make a few critical observations, having made my position clear on the main point.
The first thing that I want to say on this matter, Mr President, is that it is essential to make a clear distinction between means and ends. We can compare means, but it is not always easy, and perhaps not desirable either, to compare ends. The report says that gross domestic product is not a good measure of prosperity. That is very true. But gross domestic product is an end rather than a means, and it is not easy to fit it into the benchmarking framework.
Then there is the attractive 'undertaking-economy' example. Namely, that because benchmarking works well for companies we can transfer it to the economy in general. Things are not that simple, because two companies of the same type have the same 'objective function' . It does not follow that two economies have the same objective function, and what constitutes the objective function of an economy is in itself a very big question. The factor that maximizes the objective function in the one case cannot necessarily be said to maximize the objective function in the other. One could go to Brazil, for instance, and see canals which are open sewers right by the side of aristocratic neighbourhoods. I do not know if the Dutch would like the canals of Amsterdam to become open sewers for the sake of competitiveness.
Lastly, Mr President, the strength of competitiveness does not lie in sameness. When we do benchmarking we necessarily compare the same things; otherwise the exercise makes no sense. But the strength of competitiveness is not found in sameness, but rather in difference. It lies in innovation, and as far as that is concerned nothing can help us. No research into how others do it is going to give us innovative ideas so that we can do something different and thus gain an advantage. So benchmarking does have a place, but only when closely applied to an undertaking, at the sectoral level and with very great caution, and not to the economy in general.

Malerba
Mr President, the Commission's communication on the competitiveness of European industry prompts me to make a number of comments. I welcome the attempt to analyze the parameters for industrial competitiveness in a rational, scientific way, and I agree with the rapporteur on the need to maintain a strong production apparatus in Europe and to eliminate inefficiency and waste, while preserving the essential protection which has been achieved for the weakest members of society.
I should like to dwell briefly on a second point which is of great concern to me, namely the relationship between technology and industrial competitiveness, to which it should somehow be possible to apply benchmarking. It seems to me that industries and services are no longer high or low-tech nowadays. As well as boosting productivity and - regrettably - sometimes replacing manual work, technology can improve the quality of a product or service, and therefore creates added value and, in the long term, new job opportunities.
I believe that more should be done to utilize public research to increase industrial competitiveness, and I wonder whether benchmarking could be taken further in this area. On the one hand, we must continue investing in basic research, without which we would lose out in the future; on the other, greater synergy is needed between expenditure applied to the Member States' research institutes and research programmes carried out by the Union and industry.
It seems to me that the fifth framework programme is designed along these lines, but I think that a further appraisal, based on the criteria proposed in this communication, would be useful for studying and evaluating other measures in terms of taxation, job motivation and mobility, with a view to improving the link between technology and industrial competitiveness.

Caudron
Mr President, my dear colleagues, Commissioner, one thing is certain: to improve our economic performance and therefore have the chance to reduce unemployment, we must have competitive economies and businesses. Who disagrees?
One other thing is also as certain: it is necessary to have the means to measure this competitiveness and to act upon its causes and on any hindrances to it. So I have nothing against the standardisation of performance as a tool, nor anything against comparisons for the purpose of choosing the best solution.
All the same, does it really have to be the case that along the way it is exploited for the purpose of issuing us once again with all the old recipes for the liberal economy and to put the blame for all our difficulties at the door of too little liberalism: public deficit, State aid, flexibility, labour cost, etc. I will end the litany there.
Of course Commissioner, I do not think so, as you know! And like many of my colleagues here, I would say that competitiveness is not an end in itself. The end in itself is the reduction in unemployment, services rendered to the public, social cohesion, a better lifestyle for the majority and, of course, for there to be no increase in unemployment, even when the objective announced is the improvement of productivity.
Greater solidarity is needed therefore, particularly financial and fiscal solidarity, and if benchmarking has any use as a management tool, it should perhaps also be applied to the comparison and standardisation of the policies of the fifteen Member States in the domain of employment, with the prospect of a genuine partnership of these States.
In conclusion, Mr President, economic science certainly does need tools - and I approve of them - but take care lest the tool replaces the objective: it is the objective which should be reached using the tool, and if that is not the case harmonisation will always be downwards, and with that we return to the previous debate of the economic situation of the Union.

Bangemann
Mr President, I should firstly like to thank the rapporteur and all those Members who have taken part in this debate, since although the word benchmarking may not at first appear to be particularly meaningful, if we succeed in developing a method for determining why certain undertakings are successful in creating jobs and thereby combating unemployment, it will be an important step forward.
That is the background for our communication, and we are pleased that the Dutch presidency took up this idea immediately. What is benchmarking? It is not, of course, a scientific or economic end in itself. It is a method of acquiring certain information. And it is a method which has the advantage of enabling us to avoid the kind of ideological disputes that Mr Caudron always likes to start with me, and simply concern ourselves with practical examples of things that other countries do better than us.
Clearly, there are differences in results - within the Union, between the Union and the Member States, and in relation to third countries - and we wish to start by analysing those differences at three levels. Firstly, at the level of undertakings. First and foremost, of course, small and medium-sized enterprises must be included, and both sides of industry - not just management - will take part in all these deliberations. That can be a very great help. Some undertakings have struck better deals than others with their workforce or with the unions, for instance on flexible working hours. They are more productive and therefore even able to give job guarantees. For example, the chemical industry in Germany has agreed certain rules on working hours with the unions. Because of these agreements, it has been able to pledge that there will be no more operational redundancies before the year 2000. So if benchmarking is used properly, it can contribute to the achievement of goals that we presumably all share.
Secondly, we wish to analyse the differences at the level of industrial sectors. We have already done this in the past, moreover, when considering what policies should be pursued for the car industry in the internal market. In doing so, one of the most important questions was: is the car industry still competitive? What do we have to do to make it more competitive? We first examined this in relation to other automobile industries. We issued communications and drew up recommendations aimed at ending the protection of the industry from foreign competition by means of quotas. Because the fact is that protectionism - I am sorry to have to tell Mr Caudron, although free trade is a Liberal concept - merely leads to the protected industry becoming weaker and less competitive, so that it has to confine itself to its home market. And if that market is one day opened up, the industry can no longer compete with its rivals. That was already happening. As I have already mentioned, we are currently benchmarking the chemical industry - moreover with the aim of improving the skill levels of the workforce, so that if workers remain in the industry they will be more productive, and if their new skills help them to find another job, they will improve their future prospects.
And, thirdly, we wish to analyse the differences at the level of political systems, both within and outside the Union. Certain Member States - Ireland, for instance - are performing brilliantly. Ireland is on the periphery of the European Union, but because of its close economic links with the other Member States, it is now performing excellently. Why is Ireland performing better than a great many of the larger Member States? Germany has already been mentioned. We should give this some careful thought.
If, for example, a large industrialized country invests money in industries that are clearly no longer competitive, Mr Caudron, I cannot help it...
(Heckling from Mr Samland) I was thinking of the coal industry, Mr Samland, but we can also take the example of agriculture - and perhaps you should reflect on whether your amendments to the Commission's proposals are always in keeping with what you are clearly thinking at the moment. I sometimes think they are not, but that is something we can discuss.
So if funds are not used well, if - Mr Caudron - black holes are allowed to appear in budgets because state-owned industries are making enormous losses, then we should not be surprised if the money is not available for creating sustainable jobs. That is a simple fact. It has nothing to do with ideology. If you or I, or we together, throw our money down the drain, it cannot be used for sensible purposes.
That is what benchmarking is. It is not an end in itself, but a tool for achieving goals in the interests of combating unemployment.

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

Driving licences
President
The next item is consideration of the second submission (A4-0087/97) from the Committee on Transport and Tourism regarding the Council's directive on amendment of the directive 91/439/EEC on driving licences (C4-0011/97-96/0040(SYN)) (Rapporteur: Farassino).

Farassino
Mr President, ladies and gentlemen, we have arrived at the second reading of the directive to define a system of harmonized codes for the particulars to be included in the Community model driving licence issued by the Member States.
We have discussed this proposal and the whole question of the driving licence at great length, perhaps even a little too much so. Parliament adopted its opinion at first reading on 5 September 1996, calling amongst other things for the extension of mutual recognition by Member States to include provisions governing the suspension and withdrawal of a driving licence following an offence committed in a Member State other than the one which issued it, as well as the creation of an advisory committee to assist the Commission.
Of the eight amendments adopted by an overwhelming majority in the House, only two have been taken up by the Council: Amendment No 1, which adds a reference to subcodes to the text; the part of Amendment No 5 providing for harmonized codes 02 for hearing aids and 03 for mobility aids, so as to clarify these particulars, with the addition to codes 70 and 71 of a reference to the EC/UN symbols for third countries; and the part of Amendment No 5 concerning the addition of a code 79 to govern the equivalence between categories of licences issued before the entry into force of Directive 91/439/EEC on 1 July 1996 and the categories specified in Article 3 of that directive. In addition, the Council has amended the Commission's proposal by making provision for the setting-up of a regulatory committee, to be known as the committee on driving licences, an amendment which the Committee on Transport has accepted.
I must say that I am not at all satisfied with the conduct of the Commission and the Council, which rejected the bulk of our amendments - very important amendments which had been agreed with the representatives of all the political groups in Parliament, in other words with the clear backing of my colleagues and the other groups as well. On behalf of the Committee on Transport, I basically decided to retable the two main amendments contained in my report which, as I said a moment ago, had already been approved at first reading in the House, seeking to extend the principle of mutual recognition of driving licences by Member States to include their suspension or withdrawal; indeed, it seems quite natural to me that if someone commits a serious offence against the law or human rights or a country's cultural heritage or anything else in one Member State, then that crime should be recognized in another, and the decision of the competent authority in the Member State where the offence was committed should have legal effect throughout the European Union. That strikes me as common sense. All I can do, since the Council justifies its rejection of these amendments on the grounds that this question falls under the third pillar, is to repeat that I am firmly convinced - as a matter of principle - of the importance of harmonizing the circumstances for suspension or withdrawal of a licence at European level. I believe that this is a key element if the free movement of persons within the internal market is to become a reality. Moreover, I am encouraged by Parliament's recommendation for second reading. All I can do, therefore, is recommend that the House should stand by the position which it adopted at first reading and hope that the Commission and the Council will review their position and accept these amendments.

Morris
Mr President, obviously we welcome this report because it serves to harmonize driving licences and develop a system of codes which can be easily understood by all authorities throughout the EU. It is a positive step towards eliminating difficulties with translation and communication between drivers and various authorities and it will take the 'aggro' out of many incidents.
It will also create more problem-free driving, and we hope that will happen Europe-wide. In order to make this directive as effective as possible it is crucial that mutual recognition should also be extended - and this is important - to cases where licences have been suspended or withdrawn. We now have the absurd situation where, for example, a driver from Italy touring the UK might be responsible for a serious accident. He is then prosecuted and banned from driving in the UK for ten years or even for life. But he can return to Rome, get into his car in the airport carpark and drive away as if nothing at all had happened. This is totally unacceptable in the European Union.
Therefore, it seems logical that Parliament should support the two amendments which I have retabled from first reading. These insist that mutual recognition should be extended to bans on driving also. This is a logical step and one which all of us should accept as a matter of course.

Stenmark
Mr President, let me begin by thanking the rapporteur, Mr Farassino for the work that he has put into his report. The proposed Directive before us on which we must take a decision is concerned with establishing a list of categories which can be included on a Community type driving licence. This could give information on whether the driver wears glasses for example, or the restrictions placed on a handicapped driver, or if a driver may only drive under certain conditions for medical reasons. It could also give information on any technical changes to a car which are required in order that the holder of the licence may drive, for example reconstruction of the gear box, clutch, brakes or accelerator, an adapted control unit or other restrictions which a vehicle may have.
The proposal aims to bring about a necessary and important harmonisation. Of course it would be a great advantage if we could have the same rules for this in all the EU Member States and by so doing make it possible to recognise a driving licence regardless of which country the driver is in and the language in which the driving licence has been issued. This is of particular importance as people travel across ever more borders and more frequently drive in countries other than the country in which they themselves live. These measures may seem small but they are still important to our common goal of mobility within the internal market.
But we in the PPE group feel that the rapporteur has gone one step too far in wanting to delve into the area of criminal law as well. For this reason the PPE group will vote against the amendment proposals which have been put forward. We do this in accordance with the position we have adopted on this throughout the work. But we do accept the common position which is under consideration now.
The rapporteur has, in my view, made two mistakes: firstly he wants to make an addendum which in my view really has nothing to do with the core issue. If we want EU Member States to have common rules for withdrawing driving licences, a perfectly legitimate point of view, we must work towards putting forward a proposal for this. Simply to add a short addendum is scarcely to be recommended. Co-operation in the area of criminal law is not that easy. I think that such a proposal should be considered very carefully. So it is good that the Council has rejected the proposal in this section, and it is sensible to vote against those of the rapporteur's amendment proposals concerning this matter.
The second mistake which I think that the rapporteur has made concerns the subject matter itself, i.e. do we really want the same rules governing the withdrawal of driving licences in the EU. As I see it, we members must one day all sit down and think about what we want to use the democratic tool of the EU for. As members of the European Parliament it is easy to rush all over the place and propose many things for the EU to get involved in. But we must also ask ourselves if this a desirable development. My vision is that the EU should concern itself with a limited number of extremely important issues. We often talk about subsidiarity. This word should be writ large on our notebooks every day. This subject in my view is no exception. We must make a distinction between those things which ought to be determined by the EU and those things which should be determined by the countries themselves. Imposing punishment is something which should be the task of the individual Member States and is really not something which the EU should get involved in.

Wijsenbeek
Mr President, I should like to begin by congratulating the rapporteur on his report, which is all about common rules. I am extremely disappointed in the Council and, I have to say, in the Commissioner himself. Perhaps he can tell us why the Council has come up with such an incomprehensible position, claiming that sanctions come under the third pillar and therefore cannot possibly be used here. The Commission has put forward a proposal to introduce a Community driving licence - which was what my and Commissioner Bangemann's old mentor, the late Cornelis Berkhouwer, always wanted - and now when we have come this far and are ready to introduce it across the Community, there are suddenly objections that if it is a licence from which points are deducted, it cannot be used on a Union-wide basis. It makes no sense at all, and I hope the Commission can give us an explanation.

Belleré
Mr President, the Council decided in September 1996 that Directive 91/439/EEC on driving licences, already amended in 1994 to include a temporary derogation for Finland and Sweden, should be further amended. It is worth noting that the Committee on Legal Affairs decided in June 1996 not to deliver an opinion. We are now on the home straight, having come to the recommendation for second reading. In my opinion, Mr Farassino has done a good job in achieving part of the intended objective, especially since some of the proposed amendments - though not all of them - have been accepted: at least there is a system of harmonized codes for the particulars to be included in the driving licence, such as the compulsory wearing of spectacles and the adaptation of vehicles for disabled drivers.
I should like at this point, however, to ask the Council and the Commission what has become of an amendment tabled by the Alleanza nazionale concerning driving licences for persons with mild diabetes. That amendment should be accepted. It makes sense to me that Parliament should wish to extend mutual recognition by the Member States to include provisions for the suspension and withdrawal of driving licences, a proposal which the Council has taken on board, moreover, in announcing the setting-up of a European committee, to be known as the committee on driving licences, whose task will be to harmonize an approach to safe driving in the various Member States.
Mutual recognition of driving penalties constitutes a vital element if the free movement of persons within the common market is to become a reality.

Schmidbauer
Mr President, a driving licence entitles the holder to move freely in a motor vehicle within the European Union. If a citizen of the EU decides to live or work in another Member State, it has hitherto been necessary for him to exchange his driving licence within a certain time limit. With the introduction of a Community driving licence, that is now about to change, and the 1991 directive must therefore be amended.
For the principle of mutual recognition to be applied in practice, the codes for each type of check must be readable and understandable in every Member State. That will be helpful for the officials who carry out the checks, but also for drivers themselves. It is not enough for a document to have the word 'Europe' printed on it: its contents must also be geared to the free movement of persons and the freedom of choice of residence. This applies in particular to disabled driving licence holders, since the system of harmonized codes will now set out the conditions for driving a motor vehicle in a clearly non-discriminatory way. To this extent, we welcome the Council's common position.
At first reading, however, Parliament called - and we have just repeated that call in the Committee on Transport and Tourism - for mutual recognition to be extended to penalties, i.e. the suspension or withdrawal of driving licences. Unfortunately, neither the Council nor the Commission took account of those amendments, and we are now retabling them.
It cannot be the purpose of freedom of movement to make it possible for road hogs whose licence has been suspended in one Member State to continue driving with impunity in another Member State with the same licence. If the argument of subsidiarity is put forward to defend such an abuse, the people of Europe will have little sympathy for it. They are not interested in which pillar of the Treaty is concerned, they simply wish to have workable proposals.

Koch
Mr President, ladies and gentlemen, I welcome the Council's common position on the creation of a standard Community model for national driving licences. Firstly, this will contribute to facilitating the movement of persons within the Community; secondly, to increasing road safety and enhancing legal certainty and consumer protection; and, thirdly, to facilitating the establishment of residence in a Member State other than the one in which the driving licence was issued.
In order to achieve these goals, it is necessary for all particulars - all additional information and restrictions that must be recorded in a driving licence - to be presented in a non-linguistic form. The proposed system of standard coding of both the notes on the conditions for driving a vehicle and the notes on the administrative procedures for the harmonization of driving licences will make driving licence endorsements easier to understand and simplify checks on national driving licences, which will continue to be valid.
So far, so good. But I fail to understand one section of this House: how can you accept the continuation of national responsibility for issuing driving licences - even if on the basis of a standard Community model - and at the same time call for Community legislation on the suspension and withdrawal of licences?
Clearly, double standards are being used here. Surely matters of justice and internal security are still aspects of the Union's third pillar, and therefore subject to intergovernmental cooperation? I can only recommend the rejection of these amendments, which are in breach of existing Community law and which, I am sorry to say, were adopted by a majority in the Committee on Transport and Tourism.
I should like to thank the Council for its common position, in which it takes over the amendments adopted by Parliament at first reading and accepted by the Commission.

Ferber
Mr President, Commissioner, ladies and gentlemen, I assume that Mr Watts has to campaign in the United Kingdom until 1 May. Once again, we are discussing the question of driving licences, and we must finally bring this debate to a close. Firstly, because the Community driving licence was supposed to have been introduced on 1 July 1996 - and I have an example here of what it is supposed to look like. Now we are talking about 1 July 1997! Secondly, because we now only have to decide on the codes, on which we are actually agreed. We must therefore seriously consider whether we wish to have driving bans which are valid Communitywide, or only at national level.
I am my group's spokesman on the design of the standard Community driving licence, and I have always supported the introduction of such a licence. As Mr Koch rightly said, however, the individual Member States are exclusively responsible for issuing driving licences, and they must therefore also be exclusively responsible for withdrawing them. And so it must remain!
The example of the Italian in the United Kingdom that Mr Morris just gave was very revealing. This is the nub of the matter! Until we drive on the right everywhere in Europe, we shall continue to have such problems. When we drive on the right throughout Europe, we can talk about Community-wide driving bans. This is a clear case of distortion within the European Union.
We should now accept the Council's common position and avoid delaying further still - through a quite unnecessary conciliation procedure - the introduction of a standard Community driving licence.

White
Mr President. I do not contend that there should be the same legal, or criminal legal system throughout the European Union. I do not think that is likely to happen. But it is possible to have several legal systems within one Union or indeed, as in the case of the United Kingdom, one country.
I am an English lawyer. I am not entitled to practise law in Scotland, and that means I could not plead before a Scottish court unless I went through special procedures.
Nonetheless, a driving ban imposed by a Scottish court is recognized in England. And all we are saying in this report, or at least all the amendments say, is that such a ban should be recognized throughout the European Union.
I cannot believe that in the world of E-mail and computers it is not possible for there to be mutual recognition of bans and indeed of the points system. I hope very much that the Commission will have listened very carefully indeed to the point made by my colleague Mr Morris whose amendments I profoundly support.

Bangemann
Mr President, since today's debate has again revolved around the issue that featured most prominently at first reading - because otherwise we are in agreement - I should like to concentrate on that point. It could of course be said, simply in terms of human logic, that it can surely make no difference if a person receives a driving ban in an EU country which is not his country of residence. As you know, the proposal provides that if a person receives a driving ban in his country of residence, the ban is valid throughout the Union. That does not apply if he receives the ban in another EU country, in other words a country that is not his country of residence.
The Commission entirely understands this point of view. However, as the Council has repeatedly explained - and this is why it did not take over the amendment in its common position - the Member States' legal systems are such that a constitutional problem arises, as well as other legal problems. And the Commission cannot escape that argument. I have to beg your indulgence.
Clearly, Mrs Schmidbauer, this will not be supported by Parliament either. I listened very carefully to the speakers from the Liberal Group, but I was not really able to tell what they intend to do. In any event, the Christian Democrats will presumably hope to reject the amendment with the support of the Liberals. And even if the Liberals do not side with the Christian Democrats, there will still be no majority to carry the amendment. That is what I would assume. We are therefore debating something at the moment which probably has only theoretical significance.
It may of course take on practical significance if the Council should agree - perhaps at the Intergovernmental Conference - to transfer the responsibility for certain matters to the Community. Then we can discuss it again. What Mr Ferber said is quite right: if Parliament retables these amendments - and the rapporteur, whom I wish to thank for his work, has argued forcefully for this - the whole process will remain stalled. Not all Member States support these amendments as enthusiastically as Parliament. Then we would not get a result. That may not necessarily be a reason for not trying to push through Parliament's opinion, but the fact is that then nothing would change. Then not even the mutual recognition of bans imposed by the country of residence would be possible. That would surely be an unsatisfactory outcome, whereas the proposal represents a first step forward, which may achieve good results if all the Member States find it reasonable in practice. That is how the Commission sees the situation.

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

Question Time (Commission)
President
The next item is Question Time to the Commission (B4-0164/97).

President
Question No 30 by Konstantinos Hatzidakis (H-0225/97)
Subject: Controls and systems of control for the detection of fraud and other irregularities in respect of various agricultural products
The Commission has invoked 'fraud' as the reason for reviewing the COMs in cotton and, more recently, in olive oil. However, it is strange that almost all the publicized irregularities concern Mediterranean agricultural products. Moreover, it is only to be expected that fraud will be detected where the control structures (control bodies, etc.) are strongest and where particularly stringent controls are carried out, and that, by the same token, fraud will not be detected where no such controls are carried out, in the absence of the relevant structures and/or prejudice.
Can the Commission say whether over the past five years there has been a balance between the controls carried out by product and measure (for instance, export subsidies, interventions, etc.) in respect of northern and southern products, and whether or not these controls reveal that only the above-mentioned Mediterranean products are subject to fraud?

Gradin
A number of products are geographically limited to certain Member States. So it is not surprising that there are irregularities on certain types of assistance in these Member States. Olive oil and cotton are examples of products which are only produced by certain countries. The Commission would like to stress that it is above all the Member States which are responsible for controlling the investments to be financed by the Community. There is specific Community legislation covering controls in the agricultural guarantee section. It is the Commission's role to ensure that controls are applied uniformly. This is done through our own on site investigations and through the national control programmes. Over and above the Regulation on Financing the Common Agricultural Policy there are a whole range of regulations dealing with measures such as export subsidies. There are also particular rules concerning particular products. There are special inspection offices for olive oil and tobacco for example and inspection bodies for fruit, vegetables and wine as well. One of the objectives of the Regulation governing on the spot controls is to ensure that there is a standardised level of protection for the Community budget in all Member States. Under Regulation 595/91 Member States are responsible for informing the Commission of any cases of fraud or irregularities detected by their control bodies.
The Commission's annual report on fraud clearly shows the great variety of measures taken and generally speaking - this is something we should remember - there is deception in all of the EU Member States. So the reform of common market organisations is not just limited to olive oil and cotton, but also covers, for example, the recent amendments made in the regulations governing assistance for flax, hemp and cattle fodder. The regulations covering export subsidies have also been considerably tightened.

Hatzidakis
Madam Commissioner, I am not saying - and I am clear about this in my question - that fraud occurs only in the northern countries. It does, of course, occur in the southern countries as well. However, the Commission seems to be focusing its criticism on the southern countries alone, and that is reflected in the revision of the single market regulation in the case of olive oil. I am fully aware, of course, that Regulation 595/91 obliges the Member States to notify information about fraud that they detect. From one standpoint I am completely satisfied with the reply of the Commission; with its acknowledgment, that is to say, that the information notified makes it clear that northern products as well as southern products are subject to fraud.
I must, however, make the following points. First, the Commission has given me no figures from the controls carried out by itself, rather than by the Member States, because, obviously, it is from those controls that it gets its figures for fraud. What figures, for example, are revealed by controls carried out in respect of northern products? Second, if it is true that, as the Commission has acknowledged in its reply, fraud and general irregularities are also noted for the northern products, I find it very remarkable that it is not proceeding with revisions of the common market regimes for those products as well. Why is olive oil the only example of fraud that the Commission is concentrating on?

Gradin
The Honourable Member has totally misunderstood the Commission on this point. In the report which is produced every year both for this House and for the public we have clearly and distinctly shown that there are irregularities in both Southern and Northern States within the European Union. And it may also be more appropriate to tackle certain products in certain areas individually. The Commission has recently adopted a new way of tackling assistance particularly for olive oil and there have also been irregularities in this area.

Redondo Jiménez
I would like to put two questions to the Commission based on the fact that fraud must not only be controlled, the amounts fiddled must also be recovered. Unfortunately 90 % of Community fraud is undetected; only 10 % is detected.
First, is the Commission is prepared to set up a single organization to detect fraud in all countries? Secondly, what criteria does the Commission apply to its power to reduce or provisionally suspend monthly advances under EAGGF-Guarantee? Because money could be recovered in that way and I know it has only been applied in certain very particular cases in southern countries, but I do not know if it has been done for cattle fraud, cereals fraud or other types of fraud.

Gradin
It is true that the Member States within the Union are not very good at ensuring that payments which have ended up in the wrong pockets are repaid. We need greater cooperation in this respect to ensure that the percentage of repayments increases. It is worth mentioning here that the Commission's Financial Control has started to draw up agreements with individual Member States. These agreements are intended to help find a system for following up each project, for evaluating the use of funds in each country and for achieving a general improvement in cooperation which will encourage us to take care that tax payer's money is handled in a responsible way.

Filippi
Mr President, I merely wished to repeat a question which has been asked in the past, but has remained unanswered. The proposed reform of the COM in olive oil does indeed devote particular attention to the situation in the south of Europe. The only reason given for this reform is combating fraud: I should therefore like to know on the basis of what data and what inspections an approach of this kind was adopted in the case of olive oil, and how many inspections were carried out in this case compared with those concerning other products, for example rice imports from the Dutch overseas territories, or bananas arriving in the port of Antwerp?

Gradin
According to Commissioner Fischler, who is after all responsible for the agricultural sector, there were a number of reasons which made a change in the form of aid to olive producers necessary, as the aid and the existing organisation was inadequate. So now for example there is a proposal for a new way of tackling the irregularities which unfortunately also arise within the olive producing sector.

President
As the author is not present, Question No 31 falls.
Question No 32 by Mr Burenstam Linder (H-0252/97)
Subject: The cost of eastward enlargement
The estimated impact of eastward enlargement on the EU budget has attracted much attention, and the cost of such enlargement is often cited as an obstacle to the admission of new Member States.
The benefits of an improved security situation may be measured only in qualitative terms, but the budgetary impact of redistributing resources from existing to new Member States may be set against huge economic benefits in the form of increased growth.
Academic research has been conducted which indicates that eastward enlargement would benefit the Union greatly.
The debate would be more balanced if the Commission had soundly-based research carried out into the great economic benefits which eastward enlargement would yield for both existing and new Member States. What are the Commission's views on this, and is it planning to conduct such research?

van den Broek
I should like to make the following points in reply to the question from Mr Burenstam Linder. The enlargement to include the countries of Central and Eastern Europe is a historic challenge for the European Union. Enlargement is a political necessity and offers tremendous new opportunities. If we prepare for the process carefully and execute it well, we shall strengthen peace, security and stability in Europe and stimulate the European economy. The honourable Member rightly points out that the budgetary impact of enlargement needs to be seen in the broader context of its impact on the Union's economy as a whole. The enlargement of the internal market with the addition of hundreds of millions of consumers will mean enormous benefits for the existing Member States in terms of greater trade and economic activity. To be able to take full advantage of the economic benefits of enlargement, the applicant countries and the Union must prepare thoroughly in advance and tackle any post-enlargement adaptation problems effectively.
At the request of the Council, the Commission is working on a study into the effects of enlargement on Union policy and how these are expected to develop. The Commission will be forwarding this impact study and other related documents which the Council has requested to the Council immediately after the end of the IGC. The impact of enlargement on EU policy will be set against the expected economic effects in the broader sense, which will therefore also be evaluated. In addition to the work being carried out by its own services, the Commission is also looking at other scientific research in this field, including research into the anticipated economic benefits.

Buremstam Linder
Let me thank Commissioner Van den Broek for his answer. The advantages of eastward enlargement have of course been discussed often but it is good that Mr Van den Broek has raised the issue again. I hope that this impact study will provide a concise analysis and will attempt to make a quantitative evaluation of the benefits of such a step. Even though the European Union was founded on the principle that integration promotes freedom and peace, the fact that these are indisputably great benefits is not made clear in the debate. Today we are discussing the costs of enlargement which form a considerable barrier to that very enlargement. There is a risk that enlargement towards the east will become harder. So I am really looking forward to this impact study and hope that it will also contain this quantitative attempt at calculating the benefits.

van den Broek
I sympathize with the honourable Member's desire to have precise information on the impact of enlargement, but I think it is rather speculative to try to quantify the broader economic benefits and costs of such a complex process, given the often very uncertain factors involved. That is why I am rather reluctant to give quantitative estimates. However, I am quite happy to promise to include existing scientific research in our analysis, as I said earlier, although allowance must of course be made for the uncertainty regarding economic developments in the European Union itself as a result of the impact of enlargement on certain aspects of European policy, and the uncertainty regarding future economic developments in countries which have applied for membership. All these various factors make it difficult to give any exact figures.
I would finally point out to those who doubt the extent to which the integration of the new members will create new economic opportunities that we can already see how much trade has increased with the applicant countries since their transformation in 1989. There are many sectors, including agriculture, where we currently have a considerable trade surplus, and while we must hope, for the sake of the Eastern European countries, that the situation evens out eventually, at the same time the high level of imports of investment goods in Eastern European countries which are modernizing their economies is one of the positive side-effects of the current imbalance.

Hardstaff
As somebody who is about to go to Poland next week with the joint parliamentary committee, I should also like to emphasize the very high levels of growth being achieved both by Poland and the Czech Republic among the applicant states. Like the original questioner, I should very much welcome from the Commission a breakdown of just how much countries will contribute to the overall economy of the EU, both in terms of expanding markets for the existing Member States and the contribution of those countries to overall economic expansion.
Is the impact study being done by the Commission to consider these positive advantages as well as possible costs?

van den Broek
I shall be quite brief here, because the honourable Member should find an answer to his questions in the report which the Commission hopes to submit in mid-June, and which the government leaders are to use as the basis for deciding, probably at a European summit at the end of the year, what is to be done as regards beginning the accession negotiations. I would therefore ask you to be patient, because the evaluation and detailed research into the exact figures are already in hand, and I hope that you will be able to get a clearer picture from the reports which the Commission is currently drawing up on all ten of the applicant countries.

Redondo Jiménez
I would like to highlight the magnitude of the impact the integration of the eastern countries is going to have on Community agricultural policies, alongside the political importance of their joining the European Union.
But I want to ask whether this impact study we have been promised has evaluated in detail the impact on agricultural policies as regards products and payments.

van den Broek
Here too I must ask for your understanding. I know that these questions are more than justified in view of the plans for enlargement, but because the government leaders have asked us to report soon, around mid-July, on how all the aspects of enlargement are interrelated, including the impact on Union policy in important areas such as agriculture and structural policy, I can only deal now with certain aspects of your questions. The honourable Member knows that work has been going on for some time now on reforming the common agricultural policy within the Union, partly as a result of the implementation of the MacSharry proposals and partly as a result of the agreements at the Uruguay Round, and those reforms are now going ahead. We are also expecting a new world trade round at the end of the century on the possible liberalization of the agricultural sector. If we also relate this to the forthcoming enlargement towards the east, then it is clear that there can be no question of a radical upheaval in our own agricultural policy, but further adaptation will be needed, just as the applicant countries will be urged to adapt, first and foremost by ensuring that their farmland is privatized, where this is not already the case, and by restructuring and modernizing their agriculture so that the systems can be brought more closely into line.

President
As the authors are not present, Questions Nos 33 and 34 fall.

President
Question No 35 by Mr Camisón Asensio (H-0214/97)
Subject: WTO Information Technology Agreement (ITA)
Can the Commission explain the conditions agreed on at the recent WTO meeting in Singapore with regard to international trade in the context of the Global Information Technology Agreement (ITA)?

Brittan, Sir Leon
The agreement takes the form of a ministerial declaration adopted on 13 December 1996 in Singapore to which there are fourteen parties, including the European Community. It sets out the general objective of tariff elimination by the year 2000 for a detailed list of information technology products. Unless otherwise agreed, tariff elimination is to take place through equal steps beginning on 1 July 1997, for completion by 1 January 2000.
The ITA stipulated two conditions before it could enter into effect. Ninety per cent of world IT trade had to be covered and there had to be agreement on exceptional staging, that is to say providing for tariff cuts and elimination either ahead of or beyond 1 January 2000. These two conditions have now been met. On 24 March, the Council took a formal decision for the EC to conclude the ITA. It noted that more than 90 % of world trade was covered and agreed to the staging requests of certain participants. On 26 March, 25 participants representing 92 % of world trade information technology products met, reviewed and approved their respective schedules for the elimination of tariffs on an agreed list of IT products on a consensus basis, thus bringing the Information Technology Agreement into effect.

Camisón Asensio
I am grateful to the Commissioner for that information, but I had hoped he would take the opportunity to clarify what concessions had to be made as regards customs duties on information technology products at that meeting to gain advantages in trade in alcohol, because that was not made clear.
We would like complete transparency about the real weight on each side of the scales, as well as the reaction of the national governments to this agreement, because it is astonishing to promise a three-stage reduction in tariffs on trade in semiconductors up to the year 1999, if we still hope to achieve the planned strong increase in jobs in the European Union through exports, and if greater access is being achieved, as promised, for European industry through better quality of equipment at more competitive prices. Mr Commissioner, I would just like fuller information on that.

Brittan, Sir Leon
The spirits drink agreement was reached in parallel with the United States while in Singapore, and amounted to the elimination of tariffs on certain spirits which had not previously been covered in the Uruguay Round. It has, of course, nothing formally to do with the ITA, but it was reached, if you like, as a further concession to the European Union in those talks. There was a particular problem about the application of this agreement to rum, but the detailed modalities were finalized on 1 March to the satisfaction of the European industry.
As far as the ITA itself is concerned, I mentioned that there were provisions for special staging by agreement. An understanding was reached with the United States, within the ITA, on the semiconductor issues. This understanding provides for an elimination of EEC semiconductor duties more expeditiously than under the general rule set out within the ITA, but also in return for that, the elimination in one step of certain US duties of interest to the European Community. It was a hard-fought negotiation and that was the outcome.
As a result the European industry will participate in the inaugural session of the World Semiconductor Council which was originally established by the United States and Japan, which we were anxious to get into; indeed we insisted on this as a condition for even beginning negotiations with the ITA in mind. That objective has been achieved. The Council will overview cooperation activities between industries. We were extremely anxious that the Japanese and the Americans would be going ahead without us. Now we will be there as well.
As a result of all this, the European industry warmly welcomes the ITA and thinks that it both reduces the costs for the many industries that are the consumers of imported ITI products and provides new opportunities for European Union ITI product exporters.

President
Question No 36 by Mr McMahon (H-0221/97)
Subject: Norwegian salmon dumping
Can the Commission inform Parliament what action it is going to take pending its investigation into unfair practices by Norwegian salmon producers and processors in the export of salmon into the EU?
Does the Commission favour quantitative restrictions or a levy in the form of a tax on Norwegian salmon exports into the EU and will the Commission raise the matter with the EEA surveillance court?

Brittan, Sir Leon
Two separate investigations into alleged dumping on the one hand, and alleged subsidization on the other hand, of farmed Atlantic salmon originating in Norway were initiated by the Commission on 31 August 1996. Both these investigations are well advanced. Since they are governed by statutory deadlines, any provisional measures which the Commission may impose must be published by 31 May at the latest. No final decision has yet been taken by the Commission but Parliament will be informed of the outcome.
Should there be a decision to impose measures, they usually take the form of a duty calculated on the CIF import price. Since no request for safeguard measures has been received by the Commission from a Member State, a quantitative measure cannot at present be envisaged. Since such action takes place under the relevant Community law on anti-dumping and anti-subsidy which is based on WTO agreements and not on the EEA, it is not considered appropriate to raise the matter in the context of the EEA agreement. Informal discussions have taken place in the EFTA surveillance authority.

McMahon
Mr President, while I thank the Commissioner for his answer I would like him to give us a little more information - if I could tease some out of him.
Yesterday, according to the press, there was a meeting of the Advisory Committee in which - it is alleged - several Member States decided not to support the Commission's proposal for action: as a tax of about 12-15 % in particular was mentioned. I should like to ask the Commissioner what actually happened at the meeting yesterday.
Secondly, he says that no Member State has made any representation. Would he also confirm or deny that the Government of Norway has made representations, and would he confirm or deny that there was no representation from either Raymond Robertson, the Scottish Office Minister responsible for fishing, or Michael Forsyth, the Scottish Secretary of State? Has he had any contact with Mr Robertson since his abortive meeting and contretemps with the Commissioner for Fisheries, Mrs Bonino? I would like some answers to these questions, please.

Brittan, Sir Leon
I will do my best to give the information that can properly be given. The honourable gentleman must have misheard me, because I did not say that we had not been approached by any Member State, I said that no request for safeguard measures had been received. That is quite different from requests for anti-dumping or anti-subsidy measures to be taken. I can assure the honourable gentleman that the government to which he referred has been active in advancing the case to which he also referred and has an interest. So, in a word, there is no electoral mileage in this one at all.
I would go on to say that, as far as the Norwegians are concerned, they have made their views known. I ought just to say, to be quite clear about it, that since fisheries were expressly excluded from the EEA, not least following a demand from the Norwegian Government, the normal provisions of the Community's anti-subsidy and antidumping instruments apply, and we do not accept that Norway is exempt from their application because of its membership of the EEA.

President
Mr Commissioner, may I respectfully ask that when a question is put, I give you the floor. I am not just insisting on doing my job, those of us who do not know your language need the interpreters to provide us with the questions and answers. So I would be grateful to you if you would let me give you the floor, not only to justify my work and salary.
Mrs Thors now has the floor for a one-minute supplementary question.

Thors
We now know more about this issue due to what has recently been written in the World Fisheries' Report , where it was stated that there are plans for both duties and special penalty taxes. I hope that what is written in the newspapers is correct because it is obvious that it is not just the Scottish fish farmers who have suffered greatly. For example in our archipelago in Finland we have not asked for a single Mark in investment assistance from the Pesca programme for fish farming because the situation is such that prices have dropped from 25 to 15 Marks per kilo. Imports of Norwegian salmon have doubled. I ask therefore: is there any possibility of using this penalty tax to compensate fish farmers for the damage that they have suffered as a result of imports from Norway.

Brittan, Sir Leon
The honourable lady is quite right to draw attention to the fact that - by implication - if measures are introduced, these will not be for the benefit of any one country or any one group of fishermen. They will be measures imposed by the European Union on those who are found guilty of dumping or awarding subsidies - if measures are imposed - and they will be imposed for the benefit of all who suffer from that dumping, because the effect will be a duty which will, in future, be payable by those found guilty of dumping or providing subsidies.

President
Question No 38 by Mrs Kinnock (H-0261/97)
Subject: Panam Project
In view of the reservations expressed by Parliament in 1994 about the Panam project, is the Commission satisfied that our concerns in the following areas have been fully addressed under the current project proposal?
Have NGOs been fully consulted and involved? Has a full environmental impact assessment taken place? Will the Tibetan people be the sole beneficiaries of the project?

Brittan, Sir Leon
The NGOs working in Tibet were consulted at each stage of the project's preparation. Moreover, specialists who had worked previously with the NGOs contributed towards the writing of the project. The NGOs have also been fully involved in the reappraisal of the project, which took place in September 1995. Since then, the Commission has maintained regular contacts with the NGOs, which have expressed their specific interest in participating in the project.
The September 1995 project-appraisal mission concluded that the project, with its specific features of river stabilization, tree-planting and pasture-growing, would have a beneficial impact on the environment. A full environmental impact assessment study is foreseen as part of the baseline studies, which will be carried out immediately after the start of the project, to ensure that the impact remains positive.
The Commission can confirm that the project has been designed in a way which ensures that it will solely benefit the local Tibetan population. Tibetan people were consulted in conditions allowing them to express themselves freely during the project design and appraisal phases and will also be in charge of the management of the project if it goes ahead when finalized, as long, of course, as they qualify for the different management and engineering posts concerned.

Kinnock, Glenys
Thank you Commissioner. I am sure you will sympathize with the fact that I have to catch an aeroplane to return to the United Kingdom.
I am interested in what you say. I am glad that you say that NGOs have been consulted. That is good, but of course I am aware that is a fact that some key NGOs have not been involved at all. I want to ask the Commissioner for information about exactly which NGOs he is referring to and I would also like to know whether any contact has been made with those NGOs during the last six months.
I would also like to know why the environmental assessment will take place after the start of the project. Surely it would make a lot more sense if it were to take place before implementation of the project because that would ensure that anything untoward or any difficulties that might occur could be avoided.
I am also pleased that you talk about the design benefiting the Tibetan people. That is good. But I would also like to know whether you are ensuring that the delivery of project will also benefit the Tibetan people, not just its design, I would also like to ask the Commissioner to ensure that this is a much more open and transparent process than the last incarnation of this project and that the relevant documents will be available to Parliament and other interested parties.

Brittan, Sir Leon
I am grateful to the honourable Member for her continuing interest in the project.
Perhaps I could deal first of all with the question of the environmental impact assessment study. As I said, that is foreseen as part of the baseline studies which will be carried out immediately after the start of the project. In a sense it will be before the project really gets under way, but of course it cannot be done except as part of the project. In that sense it is happening at the very beginning in order to make sure that nothing happens during the course of the project which renders the situation worse than it was before anything was done on the ground. So I think we have a common purpose in this which will be achieved in a way acceptable to the honourable Member.
I certainly agree that it is essential to ensure that the delivery of the project is for the benefit of the Tibetan people as well as its design, and the project monitoring is precisely intended to achieve that objective.
I have no interest in anything other than transparency and will continue to keep Parliament fully informed of the process. Finally, and perhaps most importantly, the last outstanding points that have to be finalized and without which I would not be prepared to agree to give my final consent that the project should go ahead, are, firstly, that we should be really sure that the project will benefit the ethnic Tibetan population. Secondly, the NGOs should be allowed to participate in the project implementation, so we have of course been in touch with such NGOs as Médicins sans Frontières and the Save the Children Fund in the last six months, and it is our intention that those NGOs who wish to participate should be enabled to do so. This has, I know, been of great interest to the honourable Member throughout.
I think that is now finally assured but I will not give my final consent until I am totally satisfied that is indeed the case.

President
Question No 39 will not be taken as it deals with a subject which is already on the agenda for this part-session.
Question No 37 by Mr Howitt (H-0224/97)
Subject: Anti-dumping duties in the textile sector
In imposing dumping duties on grey cloth, pushing up prices for textile companies in the UK including Greige in Benfleet in my constituency, how does the Commission distinguish between European importers who apply and monitor their own ethical standards against child labour and other breaches of acceptable labour practices, and less scrupulous companies who do not seek to monitor such standards in their suppliers?
Can the Commission also explain how it ensures this measure does not inhibit fair trade access to European markets for reputable producers in less developed countries? Does the Commission plan further action in this respect?

Brittan, Sir Leon
, Vice -President of the Commission. In carrying out anti-dumping investigations, including the one in question relating to the imports of grey cotton fabrics, the Commission is bound by the provisions of Council Regulation (EEC) No 384/96 which reflects the WTO agreement in this area. The instrument is designed to eliminate the trade distortion caused by imports of goods at dumped prices and does not therefore inhibit fair access to the Community market for producers in any country, developed or otherwise.
As regards the issue of child labour, the Community's revised scheme of generalized tariff preferences, the GSP, permits us to withdraw temporarily and totally or partially the benefit of the preferential regime in respect of countries where the most degrading forms of child labour are practised, namely slavery or forced labour.
Furthermore, the scheme provides for additional preferences, that is to say at further reduced preferential rates of duty, to be granted from 1 January next year to beneficiary countries which effectively respect the standards of certain International Labour Organization conventions including Convention 138 relating to child labour.
In due course the Commission will submit a proposal for a Council decision on such additional preferences and the modalities for applying them.

Cunningham
I have a very simple question. What answer would the Commissioner give to companies in my own constituency such as J.W. Wilkinson of Kendal and Stead McAlpine of Carlisle who very much fear that the imposition of such high duties on grey cloth will create unemployment, inflation and irreparable damage to the textile industry, not only in the UK but across the European Union?

Brittan, Sir Leon
I do not agree with those who express that view although I respect their sincerity in thinking it. We have looked into this very carefully. We must first establish whether there has been dumping - and I think it is clear that there has been. We then have to see whether there has been damage to the European industry that is engaged in producing the products which have been imported cheaply at dumped prices. It is clear that there has been damage.
Then we have to look at the whole question of whether it is in the Community interest to proceed, and that means whether there are other people who are likely to suffer more from the imposition of the duties than people who are faced with this competition would gain. It is fair to say that we have carried out the exercise of looking at the Community interest with greater thoroughness in this case than on previous occasions.
We have looked very carefully at the arguments presented by those who feel they need this protection for their own production and in our view that is a fear which is not justified. We do not think the effect of the duties will be to deprive them of their own proper business opportunities. If I thought the balance was the other way I would not have put forward the proposal.

Titley
Commissioner, my understanding is that this decision went to the anti-dumping committee where the vote was 7 to 7 with Germany abstaining. Could you confirm that was the case? Secondly, I understand that it has now gone to the Member States for consultation. Could you tell me how long you anticipate that process continuing? Will anti-dumping duties continue to be provisionally imposed during that consultation period until we finally get a decision?
If anti-dumping duties are ultimately rejected by the Council of Ministers, is there any question of compensation for those companies who have been adversely affected? Finally, given that the effect of these anti-dumping duties has been to distort the market in the textile industry and the relationship between spinners, weavers and finishers and that European finishers have been put at a serious disadvantage by these anti-dumping duties, is there not a case for anti-dumping duties to be imposed throughout the textile industry and not in just one part of it?

Brittan, Sir Leon
I do not agree with the last point. I do not accept that it is possible to impose anti-dumping duties in relation to products about which there has not been a complaint. That is not an available option. As far as the procedure is concerned, it is not appropriate for me to comment on the committees to which the honourable Member has referred. It is for the Commission to put forward a proposal to the Council by 20 April. That will be done. The Council must decide within one month, by 20 May, if the measures are to be applied.

Smith
Thank you, Commissioner, for that reply. You will recall that three weeks ago in the REX Committee, I asked you the very same question based on an article that appeared in The Financial Times . You said that The Financial Times was guilty of a piece of contentious reporting. Do you still hold to that view or was The Financial Times quite accurate in that article?
You say you have carried out all the tests which apply to dumping. Included in that is that damage has to be shown. Perhaps it would help us if we knew who had been damaged because, as my colleagues have said, the information we are getting is that certain parts of the industry could be adversely affected and, indeed, employment could be damaged.

Brittan, Sir Leon
Rather than focus on The Financial Times , admirable newspaper as it is, I would prefer to focus on the actual issues which the honourable Member raised. We all know that the purpose of yesterday's newspapers, however excellent they are, is to wrap up fish. Therefore I do not think we need to hark back to The Financial Times . But the substance of the question is an important one.
The answer is that these duties are not just arbitrarily proposed because the Commission thinks that it is a fancy thing to do, but because of a complaint made. The complaint is made by people who are producing the product which has been imported. They allege that this has been imported at dumped prices and that it is damaging their legitimate business.
We have no interest in interfering with fair trading. That is why I said that the first test is: has there been dumping? Are the prices dumped prices? The second question is: has the industry been affected, or does it risk being affected, to which the answer is 'yes'. The third question is: are there other people, whether they are consumers or other industries, who would be adversely affected and worse affected than the people who made the complaint? We have looked very carefully at that third point. The Commission finds that there is not sufficient evidence to justify a finding that there would be damage which would justify not intervening, even though the initial dumping case, both with regard to the fact of dumping and its injury appears to have been established.

President
Thank you very much, Mr Commissioner. You are doubly thanked, first for your replies and secondly for your patience with the President who repeatedly broke the House of Commons rhythm you were trying to impose on the questions and answers. But remember, working with eleven languages has its obligations.

President
Question No 40 by Mr Gerard Collins (H-0246/97)
Subject: Regional policy in Ireland
In view of the overall growth in the Irish economy and with a view to assessing which parts of the country will qualify for Objective 1 status after 1999, has the Commission undertaken any research into the disparities in economic development between the different regions or sub-regions within Ireland and, if not, will it now undertake such research as a matter of urgency?

Wulf-Mathies
Mr President, as far as the Structural Funds are concerned, the entire Irish national territory constitutes a single level II region under the NUTS classification system. Because eligibility for Objective I support is decided at NUTS level II, it has to be assessed on the basis of data for Ireland as a whole, not on the strength of regional or subregional statistics.
However, the Commission recently asked EUROSTAT to provide estimates of GDP per inhabitant for the regions of Ireland at NUTS level III, using the so-called ESA method of national accounting. According to estimates for the period 1992-94, certain Irish regions were below the threshold level of 75 % of average GDP per inhabitant in the EU as a whole - although by 1995, the figures in question were already showing a significant improvement, thanks to an impressive national growth rate of 8 %.
However, I would emphasize again that these estimated figures at NUTS level III are not the same as those used in the Objective I eligibility criteria, which are applied at NUTS level II.

Collins, Gerard
My sincere thanks to the Commissioner for her reply. Can she say what information she has, and can she make this information available to us, with regard to the level of development in the different subregions of the country? Can she say to what extent discussions have taken place with the Irish Government on the possibility of sub-dividing Ireland into a number of regions in the context of the regional policy programme expected to follow the present one which finishes in 1999?
Can she say what sort of time-scale is involved in arranging for Ireland - currently a single-zone territory for Objective 1 status - to be divided into more than one region so that areas in the west of Ireland, from Donegal down along the coast to South Kerry or West Cork, might be still considered for Objective 1 area status in the post1999 programme?

Wulf-Mathies
Mr President, there has been no application from the Irish Government nor any attempt on its part to alter the existing NUTS classification. Indeed, it could not be altered without corresponding changes at an administrative level, and I am in no doubt that the present system is more advantageous to Ireland as regards support in the period up to 1999.
It is true that the figures available to us show levels of some 66 % for the border counties, 58 % for the mid-east, 63 % for the midlands and 78 % for the west, but as I said, these are figures from 1994; the new phase of funding from the Structural Funds begins in 2000, and you can see that if the present pace of development is maintained, the figures will not take long to reach the 75 % level. The Irish Government has not yet come forward with any proposals for a different approach, but should it do so, the Commission would consider them in the same way that it would consider proposals from other Member States.

President
Question No 41 by Mr Lindqvist (H-0258/97)
Subject: Streamlining the Structural Funds
The day-to-day management of EU Structural Fund operations is heavily criticized on account of its red tape and delays with payments. The EU also takes money unnecessarily from Member States in the form of contributions, only to give it back to them in the form of Structural Fund assistance. Would it perhaps not be better to reduce Member States' contributions and allow them to organize and finance structural operations directly themselves?
How will the Commission simplify, streamline and strengthen measures to assist sparsely populated areas and the peripheral regions, cut red tape and prevent situations where money is given with one hand and taken away with the other?

Wulf-Mathies
Mr President, Mr Lindqvist, Article 130a of the EU Treaty explicitly lays down the goal of strengthening economic and social cohesion. In particular, the Community commits itself to seeking to reduce disparities between the levels of development of the various regions and the backwardness of the least-favoured regions, including rural areas. The same goal applies in the relatively affluent Member States with regard to their less-favoured regions.
Article 130b identifies the Structural Funds and the Cohesion Fund as the financial instruments available to the Community for supporting its actions to strengthen economic and social cohesion. Funding for the period 1994-99 was approved by the European Council in December 1992. There was unanimous agreement on the goals of the Structural Funds, the tasks to be accomplished and the procedure to be followed, including the rules on financial procedure. Part of the reason for the complexity of the administrative process and the length of time taken for disbursement lies in the need to ensure the efficient financial management, effective control of expenditure and evaluation which European taxpayers are entitled to expect. Frequently, however, delays also result from the length of time taken for decision-making within the Commission - something we are tackling through the SEM 2000 process - and shortcomings in the administrative and budgetary procedures of the Member States, which hold up the transfer of funds from central government to regional or local level. Given that the Structural Funds are used to cofinance national measures, it is clear from this situation that national structural policy is not, as a rule, any more efficient than its European counterpart.
Another point to bear in mind is that this Community funding is used for additional, strategic projects which would otherwise be implemented only at a later date or not at all. The cohesion report identifies some impressive achievements of European structural policy in the poorer and less-favoured regions of the EU, but it also contains a number of pointers for the future, with a view to promoting more effective and transparent use of European money, targeting scarce resources, reducing red tape and putting more emphasis on success.
This applies to all the objectives that are promoted by the Structural Funds, not least those which you mentioned, Mr Lindqvist, of assisting sparsely populated rural and peripheral regions. The Commission will present its proposals for the reform of structural policy as part of the Santer Package in July this year, and will spell them out in detail in its proposals for a review of the Structural Funds regulation in early 1998.

Lindqvist
Thank you very much for such a detailed answer. My idea that perhaps we should not be sending money backwards and forwards unnecessarily between the Member States and the EU but should perhaps, reduce the Membership fee as I have suggested and instead allow countries to keep this money is just one idea among many.
Another suggestion would be for the EU to adopt certain fundamental positions, for example, concerning jobs, integration projects between different countries i.e. co-operation on integration and the environment: fundamental principles governing the use of the Structural Funds, with the aim of balancing regional injustices of course. Within this framework the Member States could then decide totally for themselves how the money will be used.
A third idea would be to have better co-ordination between EU subsidies and National subsidies, for example by allowing locally elected bodies such as the County Councils in Sweden and the district authorities to decide how the funds should be used. I would be grateful for comments on these suggestions.

Wulf-Mathies
Firstly, as you know, tax policy lies outside the competences of the European Union and the Commission. Of course, tax policy can be one of the tools of regional development, but it is not part of Community regional policy.
Moreover, Mr Lindqvist, provision exists within the partnership-based approach of our structural policy for the very thing you are advocating, namely taking decisions on projects at local level. We have monitoring committees, on which regional and local authorities are represented, and it is their job to select projects for support. Indeed, the fact that the level of funding commitments and payments to Finland and Sweden is still below the Union average is not unrelated to the learning process that we are jointly engaged in - a fruitful process, I might add, and one that is steering us towards closer partnership. But partnership implies an input from all the partners, and I believe that the experience of the European Union and the Commission has greatly helped the development of regional structural policy in Finland and Sweden in every respect. That, at any rate, is the feedback we have received from the numerous local discussions that we have organized.

Wibe
I have a very specific question for the Commissioner. I have criticised one particular aspect of the Structural Funds, namely that incomes in different regions are calculated using the measure of GNP per capita and that there is no adjustment for the level of buying power. If these were adjusted using the level of prices in the different countries the differences between regions and countries would be considerably reduced. Is this something which the Commissioner has considered and which may perhaps be included in the improvements now being talked about?

Wulf-Mathies
Mr Wibe, GDP is naturally one of the bases on which the respective purchasing-power parities are calculated, so we do already take this particular factor into account. Generally speaking, one could of course argue all day about any of the criteria that are used. A very important consideration, and one which is occasionally overlooked, is the fact that we are not able to gather and compare regional-level data for all the criteria throughout Europe, and this means, for example, that we have to opt for certain criteria, particularly when we are dealing with regional development, as opposed to straightforward national averages.

President
Question No 42 by Mr Titley (H-0262/97)
Subject: Structural Funds policy after 1999
Can the Commission report what progress has been made in its deliberations as to how EU Structural Funds will be organized after 1999?

Wulf-Mathies
Mr Titley, I should like to begin by explaining that the Commission will present its proposals, including those on the important decisions concerning the Structural Funds, in the form of the Santer Package, once the Intergovernmental Conference has concluded - hopefully in July. We are also currently engaged in internal discussions within the Commission.
I assume, however, that your question also refers in part to the problem of delays and the time factor that has characterized the funding period 1994-99, and I should therefore like to add that the timetable which we have now set ourselves will certainly put us in a position to adopt the proposals for the new Structural Fund regulations as early in 1998 as possible, just as soon as a decision is taken on the Santer Package. That would then give the Member States roughly a year in which to prepare their programmes as thoroughly as possible and submit them in good time.
The proposals that the Commission will make will be based firstly on the conclusions of the cohesion report and secondly on the deliberations of the so-called cohesion forum that is to be held at the end of this month, with input from the European Parliament. We should wait until we have specific proposals before us, which can then be discussed in detail by the House.

Titley
I thank the Commissioner for her answer. I have two questions. Firstly, in deciding eligibility for the structural funds, unemployment figures are an important element. Has the Commission received any representation from the United Kingdom Government to the effect that UK official unemployment statistics are an ineffective way of deciding eligibility for structural funds because they conceal real unemployment? My understanding is that the Commission has received such a representation.
Secondly, in deciding the future of Objective 2 regions, will the Commission take into account that Objective 2 regions which have received support have been able to deal with the problem of industrial decline in the past but are still not yet able to show value-added production, and will therefore need to have ongoing support beyond 1999 if they are to regenerate the traditional industrial areas.

Wulf-Mathies
You will appreciate, Mr Titley, that such suggestions are unlikely to emanate from the British Government. I have, however, received papers from certain academic institutions concerning the usefulness of United Kingdom unemployment statistics, and you can be assured that this is one of the issues that we shall look at. However, I would ask you to bear in mind that we do, of course, receive unemployment statistics from all over Europe, and that agreements exist as to which aspects of those figures we should take into account. Obviously, one of the issues that we shall be discussing is whether our statistics form an adequate basis for assessing questions of support, not just now but in the future.
As regards Objective II, I would ask you to appreciate that, at this stage, I cannot give what amounts to a guarantee that specific aims will continue to receive support. We shall have to discuss the entire package of structural support and the criteria on which we intend to base it. Generally speaking, I certainly take the view that structural policy will have to continue not only to support the most structurally disadvantaged regions in the socalled poor Member States, but also to offer solidarity at European level in dealing with the problems of structural change in the richer Member States. However, the questions of whether, when and in what form this should take place must be discussed in the overall context of structural reform.

McCarthy
I just wish to ask the Commissioner about another aspect of looking at unemployment criteria. We have just voted in the Committee on Regional Policy on my report on the implementation of funds in the UK, and we are very much aware that employment rates are higher in the UK. I am not talking about hidden unemployment in this case, but the fact that the UK is the country creating the highest number of low-paid, parttime jobs.
That, of course, distorts the employment criteria and, indeed, our unemployment figures. Therefore we have voted to ask that in adopting future selection criteria, in the case of the UK the Commission should take into account industrial change, GDP and the relationship between falling unemployment rates and non-sustainable employment in low-paid, part-time sectors.
I wonder whether the Commissioner could say whether it is possible to look at those criteria in a cross-comparative way, because I fear that we will neither fall within the Objective 1 criteria on raw GDP, nor perhaps be eligible under defined unemployment statistics for Objective 2 after 1999, in which case we will fall between both stools.

Wulf-Mathies
Of course, Mrs McCarthy, we shall consider carefully any information that we receive concerning unemployment trends in Member States. Obviously, however, we have to lay down criteria that will allow us to make general comparisons, and we shall not in future be able to base the selection criteria on special quotas for particular countries. I would therefore ask you to appreciate that we have to consider the overall applicability of the information we receive, and broadly speaking rely on EUROSTAT figures which - because they have the same statistical base in each instance - are the only ones that can ensure a fair comparison.

Pomés Ruiz
Mrs Wulf-Mathies, we are anxious to know what will be the criteria for the future structural funds in the context of enlargement of the Community to poorer countries, and I applaud the fact that aid to the most needy will be compatible with maintaining internal Union solidarity with those regions where structural problems generate unemployment in countries with advanced economies.
Do the studies you have carried out cover the possibility of putting some kind of limit on aid as a function of gross domestic product, in case major Community aid to recently joined countries in a deep state of poverty cannot be absorbed by their economies? Because this is probably the challenge of designing the future structural funds as from 1999.

Wulf-Mathies
I would point out first of all that we are in the process of discussing with all those affected and involved what we have learned from previous funding periods and the decisions that we shall have to take on future structural support, and I believe that the Commission is right to begin by consulting widely, rather than leaping forward with proposals and taking decisions which could then only be changed with great difficulty.
However, you are right: of course we shall also try to learn from experience and take into consideration the capacity of future Member States to administer structural support effectively, to absorb the money they receive and provide the necessary cofunding. Indeed, these three elements are essential if our structural policies are to succeed at all, and we shall certainly take that into account - not least in relation to enlargement towards the east - when we put forward our proposals in the Santer Package.

President
As the time allocated for this part of Question Time to the Commission has run out, Questions Nos 43, 44 and 45 will be answered in writing.
I want to thank Mrs Wulf-Mathies for attending and for giving these important answers.

President
Question No 46 by Mr Teverson (H-0197/97), taken over by Mr Mulder.
Subject: BSE and the lifting of the UK beef export ban
When does the Commission anticipate allowing the export of British beef from certified herds, as set out in the submission from the UK Ministry of Agriculture to the European Commission? Does the Commission intend to impose equally stringent health standards on beef from other Member States?

Fischler
Mr President, ladies and gentlemen, as you know, the steps that have to be taken and the rules that have to be followed in relation to the lifting of the ban on British beef exports were laid down at the Florence summit. Now the United Kingdom has submitted a working document to the Commission which is intended to show that the conditions laid down in Florence have been met. It sets out the arrangements for certifying exports, and offers scientific opinion justifying a resumption of British beef exports on the basis of those arrangements.
Under the Florence agreement, three further steps are now required. Firstly, the scientific committees have to discuss the British working paper, and the proposal must be considered by the Standing Veterinary Committee; secondly, there must be a successful Community inspection; thirdly, a draft Commission decision must be presented for approval by the Standing Veterinary Committee.
Clearly, the Commission would not wish to pre-empt this process of consultation and deliberation by suggesting any date for a resumption of British beef exports. In answer to the question about other Member States, the Commission has already approved BSE control programmes for France and Portugal. A similar procedure is under way for Ireland. Although the risk in these countries is substantially less than that in the United Kingdom, stringent measures are being taken to ensure that public health is protected.

Mulder
I should like to thank the Commissioner for his reply to the question by my colleague, Mr Teverson. I have a supplementary question on control methods. Certain countries where the disease has occurred have elected to slaughter individual animals or animals displaying symptoms of the disease, while in other countries whole herds are being slaughtered. Has the Commission assessed these various control methods and, in particular, what are the implications for the payment of compensation, which is partly to come from European funds?

President
Excuse me, Mr Commissioner, but the interpreters need to finish informing the various Members in the eleven languages. So if you reply immediately we will not have heard part of the question. Now that the interpretation is complete, please reply to Mr Mulder.

Fischler
Mr President, it would undoubtedly be a great pity to lose part of the question. In answer to the point raised by Mr Mulder, I would say this: firstly, there are of course measures being taken in a number of Member States which could to some extent be regarded as additional precautions, and some of which also go rather further than the Commission requirements.
As regards compensation payments, the question also arises as to whether such compensation should be paid under the heading of health protection measures, or whether it falls within the scope of market regulation. There are examples of both approaches, and obviously each Member State must reach agreement on possible forms of compensation, and indeed on whether the Union should offer compensation at all in a given case, before it embarks on any activities. That is the arrangement at present.
There is no clear-cut scientific opinion to indicate that a single specific measure is the right one. Clearly, the decision also depends to a very great extent on the objective that a particular measure sets out to achieve. Even as regards the cases that have come to light in your own country, Mr Mulder, there is no single, adequate scientific explanation. You will also appreciate that in some areas we still lack information, quite simply because not enough progress has been made in terms of scientific research and findings. On the other hand, this creates a demand for precautionary measures which do have a positive effect, it must be said; but with the best will in the world, it is impossible to say if they are really necessary from a scientific point of view.

Hardstaff
I should like to ask the Commissioner to go back to the original question from Mr Teverson - the first part. He set out a number of guidelines and stages to be gone through but did not actually give any timescale. Can the Commissioner give any idea of dates when possibly cattle could again be exported from BSEfree herds in the United Kingdom?

Fischler
I have already stated clearly that no date for a decision can be given at this stage, simply because various procedural steps have yet to be completed. But I can say this much: first of all, we need inspections to demonstrate that all the agreed conditions have now been met which form a prerequisite for any move towards a lifting of the export ban.
We recently sent an inspection team to the UK whose principal task was to convince us of the extent to which the additional slaughter programme was being implemented. The inspectors' conclusion on that occasion was that the slaughter programme was only really being implemented in Northern Ireland.
We therefore agreed to send a further inspection team: that is the first point. As for the specific British proposal, it will now have to be examined by the committee which takes over from the multidisciplinary committee, and that body will also decide which experts should be assigned to consider the matter.
We cannot impose a rigid deadline on the scientists for completing their evaluation of the proposal. But as soon as they reach a positive conclusion, we in the Commission will lose no time in bringing forward a proposal, and at that stage the normal decision-making process will begin - in other words, the Commission will submit a proposal to the Standing Veterinary Committee. If the Standing Veterinary Committee takes a decision by a qualified majority, the matter will be settled. Otherwise, the Commission will have to submit a formal proposal to the Council, and it will then depend on the Council's reaction to that proposal. If there is a qualified majority of Ministers in favour, then the proposal will be deemed approved by the Council. But if a majority of Member States are against the proposal, it will fall and cannot be tabled again. If there is a simple majority of Member States in favour, the proposal will go back to the Commission, which will then take the final decision. That is the agreed procedure, and that is why it is very difficult at this stage to set any definite date.

President
Question No 47 by Mrs Thors (H-0209/97)
Subject: Export aid for live animals for slaughter
Despite new provisions on the transport of animals, the cruelty is continuing, especially in connection with the export of live cattle for slaughter. Finnish television recently showed an appalling documentary film on the subject. On the basis of Commission Regulation 3846/87 , the figures showed that a total of ECU 296 million (about FIM 1.8 billion) was paid out from the Community budget in aid for the export of live cattle between 16.10.1995 and 15.10.1996. This was one fifth of all export aid for bovine animals. No such amounts of aid are paid for sheep or pigs.
The most logical way of bringing the cruelty to an end would be for the EU to stop paying aid for the export of live animals for slaughter. When and how does the Commission propose to bring this aid to an end?

Fischler
Mr President, ladies and gentlemen, I should like to begin by assuring you that the Commission shares the European Parliament's growing concern for the welfare of animals that are traded between the Union and third countries, and it has already expressed that concern in answers to numerous written and oral questions.
For example, at Question Time in December last year, I promised to consider how export refunds for live cattle might be linked to compliance with the transport directive, even where animals were being transported beyond the borders of the European Union.
I am pleased to be able to tell you today that these preparations have been completed, and a proposal will be submitted to the Council and Parliament before the end of this month.
For its part, the Commission has already begun discussions with the Member States with a view to cancelling refunds to exporters who have manifestly failed to comply in full with the rules on the welfare of animals in transit.
However, measures to this effect will require an amendment to Regulation No 805/68 on the common organization of the market in beef, and certain amendments to implementing provisions.

Thors
I am pleased to hear that the Commission shares Parliament's concern for the welfare of animals. The programme to which I referred in my question is in fact an updated version of the same programme which was shown on the continent last Autumn and which caused much discussion even then. Unfortunately the update shows that no improvements have taken place since then. For this reason, the majority of the Finnish members of the European Parliament are proposing in a letter to the Commission that export subsidies for live animals outside the Union be stopped. I ask therefore: has the Commission fully discussed the issue which we raised? Secondly: Is it possible for the executive committee through a separate decision to stop export subsidies as well? Has such a proposal for beef been put to the executive committee?

Fischler
When we talk about cancelling refunds in respect of live cattle or cattle for slaughter, then as I see it we have to deal with two separate issues. The issue that I addressed in my answer was that of seeking to cancel refunds in cases where we can prove that a shipper of live cattle has breached Union rules, in particular those of the transport directive.
In the longer term, we might also have a second and possibly more effective sanction in such cases, because as you know, the new transport directive requires anyone trading in or shipping live cattle to hold a licence. It would also be quite feasible, in cases where the rules are repeatedly broken, to withdraw licences from offending shippers, thereby preventing them from transporting cattle again at all.
The other issue that you raised is whether all refunds in respect of live cattle ought not to be cancelled. We know from practical experience that various third countries prefer to import live cattle. For those European Union operators involved in this trade, a blanket cancellation of refunds would mean that live cattle destined for the countries in question would no longer be purchased in the European Union, and would instead be procured overseas or in other third countries. Already - to offer you a practical example - a significant proportion of the live sheep that are imported into Egypt no longer come from the European Union, but from Australia and New Zealand. I am sure no one would try to suggest that such a long sea voyage could be less stressful for the animals than the much shorter crossings that would be entailed in importing sheep from countries of the European Union.
I think we should also be clear that even if we are not paying refunds, we need rules to ensure that animals are properly treated in transit, whether or not refunds are involved. That is why the approach that the Commission has chosen - that of making transport subject to conditions - is the right one to take in the first instance.

Anttila
Mr President, I should like to thank the Commissioner for his answer, which suggests that things are moving in the right direction. Nevertheless, I personally fear that these continuing instances of cruelty and these repeated contraventions of the rules will have an impact on consumer opinion and lead to a further reduction in beef consumption. These problems could be avoided only by halting the live transport of animals for slaughter and slaughtering them in Europe.
For that reason, I should like to ask the Commission whether it intends at least to examine the possibility of halting these shipments and creating the requisite slaughter capacity in the European Union, taking into account religious slaughtering methods? Can nothing be done to halt the shipment of animals and arrange for their slaughter on the territory of the European Union? Why precisely must animals be transported alive?

Fischler
Mr President, Mrs Anttila, we need to be clear about something here: when we talk about slaughter capacities, we have to realize that slaughter capacity in one location is not simply equivalent to slaughter capacity in another, because many countries that import beef from the European Union demand very particular slaughtering procedures. The European Union has a number of abattoirs which are equipped to carry out the rites prescribed by certain religions, but such facilities do not exist in every part of the Union, and this means that some transportation is still necessary.
Let me also mention a specific case in which I was involved. A substantial proportion of our live cattle exports are to Lebanon. The Lebanese argued that they depended on live imports because they lacked adequate refrigeration facilities, so under the MEDA programme we have now offered to build cold stores, and just three weeks ago I received a positive initial response from Lebanon. But if we do not also put in place the logistics which are necessary to ensure that there is no break in the chain of refrigeration there, Lebanon will go on importing live cattle, because conserving meat obviously poses no problems so long as the animal is alive. Clearly, therefore, these aspects also have to be borne in mind when we are considering solutions.

Eisma
I welcome the Commissioner's announcement that a new proposal is to be put forward this month making the granting of Community aid conditional upon compliance with the existing directives. Then, of course, there are the rest periods, journey times and so on. What I would like to know is how the Commission intends to monitor whether a transporter is obeying the directives? This has always been our biggest problem: we have no system for checking compliance. Will the Commission employ extra inspectors to check whether transporters are obeying the rules? If they are not, they should not be given any further aid.

Fischler
Yes of course, Mr Eisma, we must also monitor how the rules are observed. And in cases such as those you mention, i.e. exports to third countries, we depend on cooperation from the Member States. For example, as regards facilities on the ships which are used to transport animals, these can very well be inspected during loading in the port of departure. At the same time, inspectors can ensure that the animals are being handled properly during loading and carry out health checks and so on.
Another question is how to inspect the way the animals are handled during unloading at the port of arrival, and we considered this problem when we were drafting the directive to which I have referred. I would also remind you that two years ago, when the transport directive was being adopted, the Commission asked for three specialist inspectors to be employed exclusively to pursue this matter in third countries. Unfortunately, to the best of my knowledge, the promise to appoint additional staff has not yet been kept.
Finally, I would also point out that we are in the process of drafting rules that would allow us to involve nongovernmental organizations - in particular animal protection organizations - in monitoring shipments of livestock. This would require us to put in place an appropriate legal framework.

President
Question No 48 by Mr Harrison (H-0211/97)
Subject: Antibiotics in pig feed
In the opinion of the Commission does the Swedish system of banning the use of antibiotics in pig feed represent a better approach to food safety than the current EU system for which Sweden has a derogation up until the end of 1998?
Does the Commission agree that the use of these antibiotics could be seen to be like the application of growth promoters, where emphasis is laid on maximising productivity at the possible expense of consumer safety?
Is the Commission further concerned that some antibiotics are no longer working to destroy bacteria and that proposals for genetic modification could intensify the problem?

Fischler
Mr Harrison, ladies and gentlemen, the Commission is not yet in a position to answer your question conclusively. However, it will very soon be looking again at the whole question of the use of permitted antibiotics in feed. Under the Treaty of Accession, Sweden has a derogation which allows it to retain its own national legislation, banning the use of antibiotics in feed, until 31 December 1998.
Sweden has also been asked to supply the Commission and the other Member States with the scientific data on which it is basing its application for this ban to be extended throughout the Community, and for Community legislation to be amended accordingly. However, the Commission can assure you, Mr Harrison, that permission for the use of additives is granted on the basis of a very stringent assessment procedure which puts the safety of consumers first.
The Commission recently took an extremely thorough look at the problem of resistance to antibiotics in animals, the possibility of that resistance being transferred to humans and the loss of effectiveness of certain antibiotics, in connection with a particular antibiotic named Avorparcin, and it decided on 30 January this year, on the basis of its findings, to prohibit Avorparcin. This is a precautionary measure, and it will be reviewed before 31 December 1998, in the light of new test results. But it should be pointed out that no conclusive link was established between the use of Avorparcin and resistance to similar antibiotics that are used to treat humans.
Nonetheless, the Commission intends to initiate a number of studies on this question, and it has also asked the industry to carry out a programme of surveillance for antibiotic resistance in animals. I can assure you that the Commission gives careful consideration to the problem of resistance when it is granting authorizations for genetically modified products.

Harrison
I am not sure your answer will satisfy my constituent, Mrs P. Adams of Nantwich, in several respects. You did not answer the very last question about genetic modification, whether that will intensify the problem of bacteria which is possibly not destroyed by weakened antibiotics. I also learnt from you that you were intending that industry should undertake these studies. Could I have your assurance that you will monitor what the industry itself does in these studies?
Thirdly, you talk about banning Avorparcin. We could do with more details about that particular precautionary measure as you describe it. Finally, you talk about the onus being on Sweden to give the scientific evidence as to why it should be allowed to continue to ban the use of antibiotics in pig feed. Surely it should be the other way round. Until the case is proven we should be following the Swedish model.

Fischler
Perhaps in the brief time available, I did not adequately explain what we intend to do, Mr Harrison. I did say, however, that we are not relying on the industry at this stage: the Commission is initiating its own studies, but we have also asked the industry to be vigilant. Secondly, it is surely in everyone's interest that the Commission should ask Sweden to inform us of the grounds on which it decided to introduce such a ban, just as it is in Sweden's interest that the ban should apply throughout the Union. Since the Council of Ministers will take the ultimate decision on the matter, it seems sensible to me that appropriate contacts should also be established with the Member States in relation to this issue, so that the ground can be prepared for presentation of the Swedish case. I think that this is only logical.
As for the question of genetically modified organisms, another argument which is put forward here is that crosscontamination may have a role to play in the case of one particular product, namely genetically modified maize. However, I am convinced that, rather than straying into the realms of speculation on this point, the important thing is to carry out the necessary tests or to seek the advice of experts on the basis of tests which have already been carried out. In my view, it would be a mistake to venture away from tried and tested scientific opinion in this field, and to start taking arbitrary decisions.

Sjöstedt
Firstly I would like to say that I agree with Mr Harrison that the burden of proof should lie with the Commission and that we should apply a general principle of caution to all artificial food additives. Then I would like to ask the Commissioner if they are prepared to extend the Swedish exemption for antibiotic additives, so that if the Commission is still reviewing its regulations once the time limit has expired, Sweden can be allowed to extend its ban until the review is complete. I would also like to ask another question in this connection. There is also another ban on food additives in Sweden which has been in place for a few years. This is a total ban on all carcass meal in fodder. Can you here this evening promise that the Commission will never call into question the total Swedish ban on carcass meal?

Fischler
Mr Sjöstedt, in my view, the right course of action is to keep to the agreed procedure for achieving the objectives that were set out at the time of the negotiations on Sweden's accession. It was in the context of those negotiations that Sweden requested this ban, which will apply until 31 December 1998. Sweden has agreed to that. The first consideration in making such an arrangement was not that the ban should be extended beyond the agreed date, but that sufficient progress might be made in the meantime for the ban to be applied not just in Sweden, but throughout the Union. So it is with a view to facilitating a decision on the lines which Sweden seeks that I have submitted my proposals. And I still see no reason why Sweden should not make its findings and arguments available to the other Member States.
That is why I tend to regard debate at this stage about whether the Swedish derogation will be extended beyond 1998 as counterproductive. As I see it, that question will arise if it proves impossible, within a reasonable timeframe and before the end of 1998, to achieve the main objective of a lasting, Union-wide ban on certain substances. I believe, therefore, that we should stand by the agreed approach.

President
As the time allocated for this part of Question Time to the Commission has run out, Questions Nos 49 to 91 will be answered in writing.
Question Time is closed.

Eisma
On a point of order, Mr President, I regret the fact that although Question Time is clearly divided into three parts, you fail to keep to this and the third part keeps disappearing. I think we should be able to rely on having the last 20 minutes of Question Time for the third part.

President
Mr Eisma, I have been keeping an eye on the time, but if one of the parts ran over time, I will be more careful in future. The remaining questions will be answered in writing and in future I will apply what you have said scrupulously. If there was any mistake, I assure you that in future we will take care that it does not happen again.
Ladies and gentlemen, the sitting will resume at 9 p.m. The sitting is adjourned.
(The sitting was adjourned at 7.28 p.m. and resumed at 9 p.m.)

Settlement finality and collateral security
President
The next item on the agenda is the report drawn up by Mr Lehne, on behalf of the Committee on Legal Affairs and Citizens' Rights, on the proposal for a European Parliament and Council Directive on settlement finality and collateral security (COM(96)0193 - C4-0306/96-96/0126(COD)) (A4-0097/97).

Lehne
Mr President, ladies and gentlemen, the title of this directive is somewhat obscure. The Commission is proposing a European Parliament and Council Directive on settlement finality and collateral security. Exactly what is it all about?
The difficulty is that in Europe today, there is a whole raft of what are known as interbank payment systems. The purpose of these systems is to process and settle all the transfers of money between banks. As we move towards the introduction of the single European currency, the euro, we shall have a major European interbank payment system - the Target System - operating alongside the systems that already exist, and this may in turn lead to the introduction of even more such systems.
The problem which this directive sets out to address is one that has surfaced repeatedly, namely the possibility of a bankruptcy at one bank and the adverse consequences this could then have for interbank payment systems, affecting in turn the ability of those systems to function and, in a worst-case scenario, dragging down other banks as well - in other words, the possibility of one bankruptcy leading to others.
The proposed directive sets out to avoid such a situation. Basically, therefore, this is a proposal for a directive that seeks to put interbank payment systems, and ultimately also banks, in a privileged position as creditors of a bankrupt institution in certain specific circumstances.
At this point, the main area of conflict which we have to deal with here becomes clear. On the one hand, the concern is to protect payment systems - and therefore also banks. But on the other hand, one has to ask how far such measures can go without unduly damaging the concept of creditor protection in possible bankruptcy proceedings.
The Committee on Legal Affairs and Citizens' Rights, for which I was the rapporteur, took the view that it made sense in principle to have such a directive. Overall, however, we felt that the systems of protection and the measures being proposed were too strongly bank-oriented, and that it would be useful if the legislation included certain restrictions with a view to giving creditors greater protection.
The main additional elements that we have proposed are as follows. Firstly, not every payment system that is agreed between banks should automatically fall within the scope of the directive; only those systems deposited with or notified to the authority responsible for supervision should be covered. A second modification which we have proposed concerns the fixing of the decisive moment that determines when the protection offered by the interbank payment system, and the insolvency protection, should take effect. The Commission had originally proposed that the relevant moment should be that of the opening of bankruptcy proceedings. In the Committee on Legal Affairs, we regarded this as an unsatisfactory solution because, in effect, decisions on the opening of bankruptcy proceedings are often taken in the privacy of a judge's chambers and no one outside knows the precise moment of the decision, so problems of the retrospective settlement of transactions which had already taken place would not be avoided, but would inevitably continue to arise in every case of insolvency.
Finally, the Committee on Legal Affairs decided to choose a different point in time, namely the moment when the banks participating in the payment system are informed of the opening of proceedings. In recent weeks, we considered this question again within the PPE Group, and the view there was that this moment may also be less than ideal, because there could then be a requirement for proof to be furnished that individual participants in a payment system had been notified. With several thousand banks participating in a European payment system, that could be very difficult.
We have now tabled a further amendment on this point, Amendment No 21, which we would ask you to support, identifying the decisive moment as that when notification is given to the supervisory body - the central bank or a supervising authority - which then has an immediate duty to inform all other participants in the banking system.
A further unresolved question was that of which law should apply in cases of dispute where there was a conflict of legislative provisions. On this point, the Commission had originally proposed that the applicable law should always be that of the country where the payment system was located, rather than that of the country where the bankruptcy took place. Our view in the Committee on Legal Affairs is that this arrangement increases the likelihood of a conflict of laws and we believe, therefore, that where there is any dispute, the law which should apply is that of the country in which the bankruptcy occurs.
These are the three main elements covered by the amendments that have been tabled here. One final aspect is also important: we are talking here not simply about payment systems - we have also proposed that the protection of the directive should extend to all securities clearing systems. That is all I wish to put before the House in my capacity as rapporteur.

Rothley
Mr President, ladies and gentlemen, I am not one of those who is enchanted by the idea of subsidiarity. Nevertheless, I have to ask the question: who stands to gain here? The rapporteur had to refer back to an incident that happened in 1974 in order to make any sort of case for the necessity of this directive. The Commission has provided no facts whatsoever to demonstrate why it is necessary; instead we are referred to a theoretical danger. I have some difficulty with this, because there is surely something problematic about sitting down at a desk to think up dangers and then taking steps to prevent them.
That, however, is a very big subject, and I can be brief in what I have to say. We are in agreement with the rapporteur. We accept the amendments that have been tabled by the Committee on Legal Affairs and Citizens' Rights, and the new Amendment No 21.
But this brings me to what is a basic problem for the Commission's legal policy. The difficulty to which the rapporteur referred so diplomatically is a real one. In both the instances he mentioned, the effect of the Commission proposal is to grant the banks considerable latitude. In other words, the banks are being excluded from the normal provisions of the law so that they can retain a substantial degree of discretion. This is a problem, and it applies in relation to the applicable law as well as the question of when a payment system has been agreed. I share the rapporteur's view that this is an area where we need clear legislation within which the banks will have to operate. They cannot be allowed to stand outside the law. And I would call on the Commission, when it is making proposals in future, to ensure that the law applies to everyone.

Palacio Vallelersundi
Mr President, Mr Commissioner, it is an honour and a pleasure for me to take the floor to express the unalloyed support of the Group of the European People's Party for the guidelines established in this report by Mr Lehne, rapporteur for the main committee.
This solid support from my group is merited by the rapporteur's excellent approach to his work. Not only has he done an impeccable job technically, he has also succeeded in explaining the need for the directive and the reason for the amendments in terms everyone could understand, when the importance of both is only equalled by their complexity.
So the Group of the European People's Party will vote for all the amendments tabled by the Committee on Legal Affairs and the Committee on Economic Affairs, and for Amendment No 21 which we have tabled.
Today, Mr President, I want to stress the need for this directive, but above all the importance of the modifications, expertly piloted through by the rapporteur, which Parliament will no doubt approve tomorrow. In particular, the inclusion of the securities settlement systems in the scope of its application, as well as the block of amendments which respond to the concern of Parliament for the primacy of the principle of legal validity - which is the ultimate guarantee of the proper functioning of the market - and which relates to the law applicable on the dies a quo , and to the need to establish the obligation to lodge agreements on settlement and securities systems with the authority responsible for supervising them.
Finally, Mr President, obstacles to the task of completing the internal market are currently arising from all sides and creating pessimism and the temptation to accept weak solutions, by their nature often poorly defined, which lead to fictitious harmonization and serious distortion when it comes to incorporation into national law. So this firm initiative from the Commission, with its high quality and wealth of consequences, encourages Parliament to act in fulfilment of its co-legislative function.

Janssen van Raay
Mr President, it is a bad sign that the rapporteur and the Committee on Legal Affairs have already had to table an amendment to the title of the directive, which is incomprehensible. Settlement finality and collateral security does not mean anything to anyone. Fortunately, the rapporteur has come up with an amendment that we should all vote for, which at least makes it clear what the directive is about. The impenetrable fog surrounding this proposal, which the rapporteur has done his best to disperse, merely symbolizes the sceptical approach which the lawyers working on this have adopted, Mr Monti. However, I do not wish to go into that. The rapporteur has done his work well and the Commission has reacted accordingly, so let us hope that something good comes out of it. The main thing - and I am always glad to see the Commissioner here so that I can pass on my thoughts in person - is that all directives dealing with bankruptcy, such as this one, show just how urgently we need to harmonize bankruptcy law. Mr Rothley has rightly pointed out the theoretical nature of the risk provided for in this directive, but it is high time that we had harmonization in the interests of our businesses. I know that it is difficult, I know what the problems are, Commissioner, and they are not easy to resolve. I am also well aware of the problems with the priority list of debtors, which is also not an easy matter. But every time we deal with issues like this, we come up against the fact that differences in national bankruptcy legislation mean problems for businesses at international level. And even though I assume we all support the rapporteur and his report, I still wonder if we are giving sufficient attention to the position of the banks.

Monti
Mr President, ladies and gentlemen, I should like to compliment the Committee on Legal Affairs and in particular its rapporteur, Mr Lehne, as well as the Committee on Economic and Monetary Affairs and its rapporteur, Mr Katiforis, on their substantial contributions to our examination of this proposal - a highly technical proposal, and a difficult but important one.
Indeed, this proposal represents an important step towards the greater liberalization of capital movements in the European Union. Whereas in principle the free movement of capital is fully guaranteed, in practice a number of obstacles still remain, such as the fact that payment systems and securities settlement systems are still not adequate to ensure true freedom of movement across borders, because of the existence of different legal systems in the various Member States. A minimum of legislative harmonization, which is the purpose of this directive, will eliminate the most significant barriers and allow for the creation of real cross-border highways for capital movements throughout the European Union.
I am particularly pleased that the committees responsible have proposed the inclusion of securities settlement systems within the scope of the directive, having obtained a favourable opinion from both the European Monetary Institute and the Economic and Social Committee. We note, turning to the individual amendments, that this is the thrust of Amendments Nos 4, 5, 7, 8, 9, 11, 14, 15, 16 and 17.
Amendment No 1 seeks to modify the title of the directive: although such a change is acceptable to the Commission, its effect would be to indicate in the title that the directive relates to these systems in cases where institutions participating in them are involved in insolvency proceedings. However, this directive does not concern bankruptcy as such, but only deals with it to the extent that it creates systemic risk. Perhaps the following title could be adopted: ' proposal for a European Parliament and Council Directive on the systemic risk inherent in payment systems and securities settlement systems' .
Amendments Nos 2 and 3 - which the Commission can accept - add some useful information about the directive: the addition of a provision on a notification procedure, as through Amendment No 6; and another change aimed at improving legal certainty, thereby helping to achieve the goal of the directive, namely the avoidance of systemic risk. However, the depositing of the agreement on which the system is based with the authorities responsible for supervising the institutions participating in the system, followed by the publication of a notice announcing the fact, strikes us as unnecessarily complicated. What is more, in several Member States, the authority responsible for supervising such institutions is different from the one in charge of supervising the system itself, which would lead to an artificial division of powers and create confusion. The Commission therefore has some difficulty in accepting this amendment. The same applies to the addition of the words 'rules for clearing balances in connection with settlement' in Amendment No 10, since such a wording could detract from the clarity of our definition of a payment system. For the purposes of the proposal, a system is called an EC system if the law applicable to the agreement on which it is based is the law of a Member State. That is the criterion which underlies the Commission's proposal, and it would not seem possible to apply a geographical criterion. Amendment No 11 does nevertheless seek to introduce such a geographical concept by suggesting that a system is located in the Member State where the book entry takes place. However, for a given operation, more than one book entry may be made with different institutions, such as the clearing house and the settlement agent. In my view, it would therefore be necessary at least to clarify which book entry is meant; in the absence of such clarification, we find it difficult to accept this amendment.
Amendment No 12 expands the original definition of a third country payment system by using the more general term 'third country system' , so as to include securities settlement systems. In principle we can accept this modification, but we need to complete it by adding the words 'securities settlement systems' . Since the central banks carry out transactions in financial derivatives, these must indeed be included in the definition of monetary policy operations, as proposed by Amendment No 13.
Amendment No 16 contains three paragraphs, the first of which gives us no cause for concern. The second replaces the words 'contracts entered into' with the words 'contracts entered in the EC system' . But the Commission is using the term 'entered into' to mean 'concluded' , and is not referring to the registration of contracts in payment systems. As for the unwinding of the settlement and of securities transactions, the amendment appears to be saying that once payments or securities transactions have been settled, they can no longer be unwound. But the aim of the directive is to protect remittance orders from the risk of unwinding solely while they are within the system, because that is when systemic risk exists; once the settlement has been made there is no longer any systemic risk, so there is no reason to prohibit the unwinding of sums relating to payments already settled.
The effect of paragraph 3 of Amendment No 16 is to delay the opening of insolvency proceedings against an institution participating in the system until the moment when the competent authority formally notifies the other participants that proceedings have been opened. This seems to be an excessively cumbersome procedure, because news of the bankruptcy of a participant in a system tends to spread very quickly through the financial markets; moreover, such a procedure would extend the preferential regime, as established under the directive, beyond the moment when the participants in the system actually learn of the insolvency in question, which cannot be justified in terms of attempting to avoid systemic risk; we therefore have difficulty in accepting Amendment No 16, and the same applies to No 21.
Amendment No 17 states that payment orders or orders for securities transactions may not be revoked after the opening of insolvency proceedings. It would seem obvious, however, that if a participant in the system becomes bankrupt, that participant's assets are frozen and revocation is therefore impossible. I do not see any need for further clarification here. The Commission's proposal had a different aim, namely to prevent third parties from revoking any remittance order which has been entered into the system, given that such third party institutions cannot do so on the basis of the legislation of the other Member State concerned. It is clear, in fact, that if this were to happen in respect of a substantial sum, systemic risk could occur: the reference to third parties must therefore be preserved.
Amendment No 18 is acceptable since it helps to clarify the text. No 19 proposes the deletion of the article whereby, in the event of the insolvency of a participant in the system, the insolvency law applicable is that of the country where the system is located. That deletion would run counter to the directive's goal of reducing systemic risk, and for two reasons in particular: the need to guarantee legal certainty, and the need to avoid conflicts of legislation. All of which leads to the conclusion that the directive can achieve its goal of protecting systems from systemic risk only if Amendment No 19 is rejected. On the other hand, the Commission welcomes No 20, which clarifies the meaning of the text.
Mr President, ladies and gentlemen, I hope that my attempts to clarify matters might cause you to reconsider the advisability of those amendments, in particular Nos 17 and 19, which the Commission does not find acceptable.

President
Thank you very much, Mr Commissioner.
The debate is closed.
The voting will take place tomorrow at noon.

Simpler legislation for the internal market (SLIM)
President
The next item on the agenda is the report drawn up by Mr Crowley, on behalf of the Committee on Legal Affairs and Citizens' Rights, on the communication from the Commission to the Council and the European Parliament on &#x02BC;simpler legislation for the internal market (SLIM): a pilot project' (COM(96)0204 - C4-0446/96) (A40108/97).

Crowley
Mr President, I should like to thank the Commissioner for being here for our deliberations on what I consider to be a very important and urgent topic. The idea behind the single market was one of dynamic movement in the European Union and in 1985 when the Commission set out its idea in the White Paper for the single market programme, there was a belief that this would all be completed by 1992. Unfortunately we have not been as successful as we set out to be. However, our optimism and desire to succeed and to go further remains and we should not be diverted from the task of trying to achieve what is ultimately the finest and most efficient goal for the European Union.
The pilot programme SLIM, simpler legislation for the internal market, came about because of the recognition of the need to ensure that the legislative acts which the Commission, Parliament and the Council adopt and ask the national authorities to transpose into national law should be as effective as possible in tackling the specific issues with which they are concerned. It has always been a downside of the European Union that the format used for the legislation makes it inaccessible to the ordinary European citizen.
Despite the fact that I have been working in the system for three years and have a legal training, on a number of occasions I have been unable to follow the sequence of events which goes to make up the final legislative document. It is essential that, when we pass laws, there is a definite basis in fact that can be understood by each and every individual, whether a practitioner, a business person, a government official or the individual citizen.
To look at another couple of examples, I would point out that in the Paternoster there are sixty words, in the Ten Commandments there are 128 words, in the American Constitution there are 457 words with 142 added through amendments in the past fifteen years. In a recent EU directive on the presentation and sale of certain types of products there are 29, 547 words. Is it necessary for us to have so much verbiage in our legislation. I think not.
I have put forward some very simple and basic suggestions in my report which could help to overcome this problem. Firstly, looking at the whole area of codification, we can bring together previous legislative acts that deal with the same topic and combine them all into one single individual legislative act. This could make it easier for the practitioners of law, for the people in business and the employees who have to comply with these laws to find the exact reference they are looking for.
Secondly, as from now we should start to make our new legislation simpler. Let us lead by example. Let us set down the yardstick which must be followed by ever Commission and every Parliament after us to ensure that we have a proper, simpler legislative process. In that regard I would draw the attention of all Members to the length of my report. There are ten paragraphs in the conclusions. In a report we dealt with this morning there were 178 paragraphs. We must lead by example. Make it simple, make it plain but make it so that no doubt can be cast on its accuracy or leaving it open to different interpretations.
We must encourage Member States not to use the European Union as the whipping boy when they want to bring in bad legislation at national level. They should not abuse directives by including things that they do not have the courage to bring in under separate national legislation as they should under the rules of subsidiarity. We must also ask the national governments to ensure that they have a simpler legislative process where individual citizens can understand the whole process.
Finally, I should like to draw the Commissioner's attention to the fact that I am very disappointed with the new projects which the Commission hopes to follow under this SLIM project. I ask that we make them more relevant and immediate to the task of the single market, in particular focusing on intermediation and distribution of financial services, public procurement, the machinery directive and the directive on the marketing of dangerous substances. We can make it real, we can make sexy and we can make it understandable to the European citizen.

Murphy
Mr President, I should like to thank the Commission for its proposals regarding SLIM, and also Mr Crowley for his excellent report.
Simpler legislation for the internal market, I believe, has key potential to improve the competitiveness, profitability and, most importantly of all, the job creation potential of businesses the length and breadth of the European Union. Speaking as somebody from the Committee on Economic and Monetary Affairs and Industrial Policy, this is a key area for us to look at in regard to SLIM.
But success in this area will only come about if we have an inclusive approach. There are fears and concerns that certain key actors, in particular SMEs and, to a lesser extent, trade unions, have not been fully involved in the SLIM process. I would stress that for this to work everybody has to feel confident. What we are trying to achieve is something quite radical and something we ought to be trying to achieve.
I would like briefly to touch on two or three areas which are of key concern. Firstly, we need to introduce our legislation in such a way that it is impossible for national governments to gold-plate the legislation. Gold-plating European legislation actually harms the single market, harms competitiveness and the ability of companies to create jobs.
Secondly, we must accept quite clearly that national legislation is far more the enemy than the legislation we generate at European level. We ought to be taking the challenge of national legislation head on. The Commission produced an excellent document in February of last year called 'National Regulations Affecting Products in the Internal Market: a Cause for Concern' . It was never formally adopted by the Commission, yet it shows clearly how it is national legislation as well as our own legislation that creates problems.
The SLIM process, I believe, can be excellent news for small companies in my area of the United Kingdom, the industrial Black Country, and throughout the whole of the European Union. But we must have this inclusive approach and we must highlight the dangers of gold-plating and the dangers of national legislation.
I would just like to welcome again the Commission's proposals and thank Mr Crowley for his report.

Cot
Mr President, I would like to congratulate the rapporteur on having succeeded, with such a slim subject, SLIM, to be brief. That being said, who would not subscribe to the idea of simplifying Community legislation?
But what strike me on this matter, are the superabundance of means and, somewhere, the modesty of results. Four subjects were chosen by the Commission. On Intrastat, it is a matter of bringing the number of commodity codes down from 10, 700 to 7, 000, which is no doubt laudable. On the subject of construction products - I quote our rapporteur - the situation is not very clear. On the subject of the recognition of diplomas, you are going to make some proposals. And on the subject of ornamental plants, it is complete blockage.
At this rate, Commissioner, what prospects does this exercise offer? That is the question I would like to put to you. Is the SLIM exercise an experiment, an experimental mode of legislation called to become a method, or is it already a method of legislative reform in itself? And at the rate it is going, what then is the perspective of this reform? Will it require ten years, one hundred years or even more?
Of course SLIM does not represent the whole of the strategy of simplification and codification of European law implemented by the European Commission. But I would like you to give us some indication as to the rest of the strategy, as to the general framework, because once again, even if the method is quite remarkable, the superabundance of means turns out with some rather modest results, if you consider the whole of the portfolio for which you are responsible.

Mosiek-Urbahn
Mr President, it was Montesquieu who urged legislators to be guided by a spirit of moderation. The rapporteur certainly gave a practical example of that spirit, and it is clear from the Commission's pilot project, which is before the House today, that the spirit of moderation is now to be taken seriously in the process of enacting European legislation.
Following on from the Molitor report, the SLIM initiative represents a further important step towards improving and simplifying Community law, and for that reason it is to be warmly welcomed. However, I should like to make a number of observations.
The Commission ought to have clearly explained the basis on which it selected the sectors that the SLIM teams have considered. Such an explanation would have been particularly welcome given that the topics selected were not exactly burning issues for the public. Suffice to say that one of them was ornamental plants. The fact that one Member State was keen to have this sector included is surely not sufficient justification. We need more than that. Sectors which merit urgent consideration in the future include public procurement and financial services, because these are areas of particular importance to our national economies.
However, the Commission ought to begin by focusing on sectors where extensive legislation has actually been adopted. For that reason, issues such as those of migrant workers and taxes are not particularly appropriate priorities for the SLIM initiative. The composition of the teams should be transparent and balanced so that they can operate with maximum efficiency. It is particularly relevant in the context of the SLIM initiative that the Commission should base its approach, in a comprehensible way, on the checklist that was drawn up by Parliament when it presented its response to the Molitor Report. This should become a compulsory part of the process of drafting new laws or reviewing existing ones, so that tendencies to over-legislate can be exposed.
The whole idea behind the SLIM initiative is to reduce the costs to national economies and business which arise from over-complex legislation. The aim is to make Europe more competitive and above all to improve the potential for job creation. But the SLIM initiative will only serve to achieve that aim if its conclusions become a basis for making legislation genuinely more readable and straightforward in practice, and if that effect works its way through to the Member States.
The Commission should pull out all the stops to achieve that aim, and then demonstrate its achievement to the public. With that in mind, I would encourage the Commission, as a matter of urgency, to push ahead with this project.

Janssen van Raay
Honesty compels me to admit that the Commission often puts forward perfectly clear and comprehensible proposals which national bureaucracies subsequently make such a muddle of that no one can understand them. That was the first thing I wished to say.
The second point I would like to make is that we unfortunately had the wrong idea about the monitoring report. It was not the solution we wanted, which is why I am particularly pleased that the Commission has come up with this initiative, and I wholeheartedly support what the rapporteur has said. The main thing is to ensure that those who deal with the law should find it comprehensible and readable. Mr Monti, if you could find a way to have the Maastricht Treaty rewritten without changing its substance but producing a text which professors of law could understand, you would be taking a great step forward and I would wish you every success with it. It is absolutely vital that lawyers at least should be able to understand the legislation we produce. The examples which the rapporteur gives are very good ones, but our work on simplifying texts and making them more readable must focus on both existing and future legislation. It is a very laudable project, and I wish you every success.

Thors
Mr President, at the beginning of the 1990s in my homeland we had a campaign to simplify legislation, a campaign which was in fact quite successful. It was particularly good for getting rid of regulations at a lower hierarchical level than laws. I think this is also important in connection with the SLIM project. It is not really the legislative work in this House which is affected. When we succeeded in simplifying things at National level there were cynics who said that it was like carting away standards in a wheelbarrow - then in comes a lorry from the EU. This comparison has indeed been shown to have some truth in it. So I also have a desire for the SLIM project to succeed.
As many earlier speakers have already said, it has not produced many results so far. We have really only seen any form of result in two of the pilot projects. Those of us in Parliament who have not been so closely involved are asking ourselves: Why did they start with that particular area? This is something which the rapporteur also touched upon. Why did we start with building products when we know that the Community has tried for years to simplify this sector?
As part of a more open spirit in the work I would also like to see a fair participation from different parts of the region. As we mentioned in the committee report the area of public procurement is crying out for simplification and there is a need for procedures in several Directives to be standardised. Why do we continue to have different methods of procurement? The legal committee would like to see procurement subjected to a method of slimming which is more lasting than the slimming methods found in women's magazines in the spring. We also know that many suppliers and the public sector would like to see a simplification.
The fact that application of the legislation must be safeguarded, something which I understand the Commission has said in another context, is no real answer. There are examples of situations where Directives have been amended before they have even come into force.
I hope also that the management of the Commission pay attention to the fact that there can be considerable opposition at a lower level from Commission staff. We could decide, for example, within this sector and other sectors, that from a particular time onwards a regulation is valid for five years unless it is renewed. I think this is one way to really speed up legislation.

Scarbonchi
Mr President, my dear colleagues, I hope to congratulate the Commission on the SLIM initiative which can only meet with approval in its principle, even if the pilot project looks, especially in its state, like an operation of aesthetico-legal surgery.
Indeed, I am sorry that the four sectors chosen are so far removed from the daily concerns of European citizens. What is more, the simplification of legislation relating to the internal market must not in the future at any event, become the Trojan horse of European deregulation, of which you can measure daily the social divisions it creates and the increases in unemployment which it feeds.
Finally, I note with disappointment, as it relates to the future of the SLIM initiative, the total absence of common vision between the Executive Committee, the 'Internal Market' Committee and the Committee on Legal Affairs. Let there not be any doubt, Commissioner, working less but working more effectively for the well-being of European citizens is the only common challenge which can be taken up to enable the completion of the single market.

Wijsenbeek
Since I only have a minute's speaking time, I shall begin by offering my brief congratulations to the rapporteur.
First point: accessibility. We have tabled an amendment on this, because we feel that the kind of language and the complicated constructions used are often the result of compromises between the Member States and were not in the original Commission proposals.
Second: consolidation. There are now so many different types of legislation on various subjects and in various places that these should be consolidated and brought together.
Thirdly, we feel that it is extremely important to include simplification and accessibility in the work being done on fiscal harmonization. It is precisely these kinds of discrepancies in fiscal treatment that make the internal market so difficult and lead to more unemployment.
Finally, I would point out that the Member States are far more to blame than the European institutions for producing too much complicated legislation. Commissioner Bangemann made the point here in the House that 80 % of the 440 new pieces of legislation introduced in 1994 were initiated by the Member States.

Monti
Mr President, ladies and gentlemen, I should first of all like to thank Mr Crowley and the committees responsible for their work and their support for the SLIM initiative. Let me tell you briefly what stage we have reached and what we are proposing to do next.
Firstly, as far as the first phase of the SLIM initiative is concerned, comments have been made regarding the four pilot sectors chosen and the fact that they are somewhat remote from the lives of our citizens. I would remind you that the idea of the SLIM project originated at the end of February 1996; I believe that we have carried it out, albeit as a pilot project at this stage, in a far shorter space of time than is customary for the European institutions, with whose pace of work you are familiar. In a true spirit of simplification, we even persuaded the Member States that they need not all be represented in each of the SLIM teams, which was no easy matter; the Member States divided the work among themselves, and we were therefore able to set up streamlined teams capable of deliberating fairly rapidly. However, the choice of sectors was influenced by the speed with which we wished to carry out this initial pilot. Are these sectors remote from our citizens' lives? I would say not. Perhaps ornamental plants might raise a few eyebrows, but INTRASTAT is something that firms were finding very burdensome in their day-to-day operations; as for the recognition of diplomas, please do not tell me that this issue is remote from the lives of our citizens, and the subject of construction products is linked to one of Europe's leading economic sectors, but I am sorry to say is the area in which we have made least progress.
How far have we come in the first phase? On ornamental plants, a large majority of Member States are in favour of simplifying the directive and opposed to an optional directive system. There is also a consensus on the degree of simplification and the aspects of the directive to be simplified. The Commission intends to present a detailed proposal by May, in keeping with the timetable which has been drawn up. As regards INTRASTAT, it might - I repeat - appear to be remote from citizens' lives, but it is extremely close to the day-to-day concerns of firms, in particular small businesses. In this sector too, rapid progress is taking place: efforts have been made to reduce the number of data to be collected and to alter significantly the INTRASTAT nomenclature. The Commission is to meet regularly with representatives of industry between now and June, when it will submit a proposal which it hopes will be adopted in November.
Turning to the recognition of diplomas, here the Commission intends to bring forward proposals by the end of the year to establish a simplified method of updating the lists of diplomas benefiting from automatic recognition and to streamline the advisory committee procedure: this provides a partial reply to Mr Cot's question, and in some cases it is a matter of establishing a method, a kind of blueprint, to be used on a case-by-case basis. The recommendation that the provisions on education and training in the sectoral directives should be re-examined, with a view to laying down competence-based criteria giving more weight to education and training outcomes, rather than to rigid rules on content, is currently being looked at by the advisory committee in the context of nursing education.
As for construction products, I do not deny that this is the sector in which we have encountered the greatest difficulty. Of the proposals on how to improve this directive, the Commission has opted for the one combining short-term action to lay down the standards needed if the directive is to function properly with an appraisal of necessary modifications to the directive in the medium term. In the committee responsible for this sector, the Commission came up against vigorous opposition from the Member States to any amendment of the directive. Here I would make one comment: we are all, in principle, in favour of simplicity and simplification, but what I hope is one of the merits of this procedure is that it demonstrates how difficult simplification is in practice, and how many calls for simplification encounter resistance from those in the Member States who would be affected by simplification. I therefore hope and believe that this is in itself a useful undertaking and something of a learning exercise, which shows the gap between talking about simplification and putting it into effect.
I should now like to say a few words concerning the second phase and the choice of sectors which Mr Crowley also mentioned. In the light of internal discussions and requests put forward by the Member States, the European Parliament, the Economic and Social Committee and representatives of the sectors concerned, I intend to propose to the Commission very soon that the next phase of the SLIM programme should be based on the following sectors: certain aspects of the present VAT system, financial services - Mrs Mosiek-Urbahn - beginning with the banking sector, the combined nomenclature for foreign trade and a commodity sector yet to be defined.
I have no time to explain why we have pursued this approach or why I intend to propose these particular sectors to the Commission. Some of you referred with good cause to public procurement: I would point out that simplification in this area is already being considered within the Commission, and is the subject of consultations following the publication of the Green Paper which deals specifically with public procurement.
I would end by thanking you for your support and your understanding of the difficulties, and I would ask you to see this as a practical and pragmatic exercise which will enable us all to move on from the easy matter of talking about simplification to the difficult task of putting it into practice.

President
Thank you very much, Mr commissioner.
The debate is closed.
The voting will take place tomorow at noon.

Capital adequacy and investment services
President
The next item on the agenda is Ms Oddy's recommendation for a second reading on behalf of the Committee on Legal Affairs and Citizens' Rights on the common position adopted by the Council with a view to adopting a European Parliament and Council Directive amending Council Directive 93/6/EEC on the capital adequacy of investment firms and credit institutions and Council Directive 93/22/EEC on investment services in the securities field (C4-0005/97-95/0188(COD)) (A4-0093/97).

Oddy
Mr President, the substantive issue in this report is fairly simple. It is just a question of setting up a committee in accordance with Decision 87/373 of the European Economic Community. However, it raises enormous questions of procedure, and in particular comitology.
In its original proposal, the Commission proposed a Type III(a) committee. Parliament, in its first reading, recommended a Type II(b) committee. The Council, in its wisdom, decided to ignore both the wishes of the Commission and of Parliament and has put in the common position a recommendation for a III(b) committee. Nor does the common position include a reference to the modus vivendi which was agreed between the three institutions in 1995. All three institutions are bound by that agreement and that is what should govern this situation.
The common position also includes a number of unusual features such as the committee in question would adopt its own procedure which is not in accordance with Decision 87/373 and the Commission may consult the committee on any new situations. The Committee on Legal Affairs and Citizens' Rights is quite unanimous that this common position is not in the interests of parliamentary democracy or transparency and it is not democratic. It simply undermines the position of Parliament.
Consequently, the Legal Affairs Committee voted unanimously to restore the original amendments in the first reading and to return to these in the second reading. The Legal Affairs Committee is quite adamant that the Council should not seek to undermine Parliament in this way and we wish to go to conciliation to sort out these difficulties.
Since the vote in the Legal Affairs Committee, a number of further concerns have come to my attention. The declarations made in Council have only just become available and I would criticize this delay. The Declaration 1 runs counter to the modalities set out in Decision 87/373, as it is the Commission which is assisted by the committee and not the chairman as is usual. Further, the Member States should have the possibility to convene meetings and have items entered on the agenda of the committee. In this case, however, the declaration states that it is the Commission and no one else which should submit draft measures to be taken, contrary to Decision 87/373.
The declaration concerning Article 1(6) talks about the practice followed, systematic use and consulting the securities committee when it plans to submit new proposals. These are illegal under Decision 87/373 and it would be extremely detrimental to Parliament to agree with this pseudo-legal and possibly illegal practice.
The Commission is supposed to be the guardian of the Treaties. I maintain that the guardian of the people of the European Union is the Parliament. We are the thin line. We are the organization which protects the public of Europe. If the Commission and the Council flout the wishes of this Parliament, then we will have dictatorial bureaucracy. That is not acceptable to the people of this European Union. The Commission and Council must think again and must listen not only to Parliament but to the people of Europe who are entitled to have transparent and open decision-making and legislation.

Alber
Mr President, ladies and gentlemen, in fact I hardly need to take the floor here. I would just say that the PPE Group entirely supports the report by Ms Oddy, and therefore agrees with all the amendments which have been retabled. We also endorse the criticisms which the rapporteur has just expressed in the debate. We too believe that this is first and foremost a question of transparency.
We are once again having to deal with this tiresome issue of comitology. Of course, it is quite legitimate and, to some extent, understandable that each side should choose the system which suits it best and gives it most scope to bring its influence to bear. However, the Commission and the Council should in fact consider that one of the reasons for the negative attitude displayed by our citizens towards Europe is that many people disapprove of these secret negotiations which remain unknown to the outside world. Simply for the sake of making Europe transparent and comprehensible for our citizens, we should opt for the procedure being proposed here, namely a management committee of Type II(b), and not a Type III(b) regulatory committee.
Type III(b) is the so-called contre-filet procedure. I have to say that just at the moment I would prefer a faux-filet ! We are opposed to the contre-filet procedure, and we believe that the modus vivendi should be adhered to, as set out in the Oddy report. Unless we settle this whole comitology issue once and for all, and so as to bring about transparency, then the process of comitology will eventually become one of criminology, and that would not be a good thing for the Commission or the Council, nor indeed for Europe and ourselves. In conclusion, I would repeat that we entirely support the Oddy report.

Janssen van Raay
Mr President, I am only here to say bravo, Christine! We support you. Get on with it!

Monti
Mr President, ladies and gentlemen, I am grateful to the Legal Affairs Committee and its rapporteur, Ms Oddy, for their excellent work on a proposal for a directive as complex as the one to establish the securities committee. The establishment of this committee, to sit alongside the banking advisory committee and the insurance committee, will constitute another step towards the completion of the internal market.
As you know, the securities committee will serve two important roles: its function will mirror the so-called committee procedures under the directives on investment services and capital adequacy; from now on, the task of making technical adjustments to these two directives will be performed by the Commission with the assistance of the securities committee. In this context, account will clearly have to be taken of the need to involve Parliament in the process of updating the directives, as was agreed under the modus vivendi of 1994. Secondly, the new committee will have an advisory role, providing scope for useful exchanges of views between the Member States' representatives and the Commission concerning developments on the securities markets.
Turning to the amendments proposed by Parliament at first reading, the Commission is willing to accept Amendment No 3. Indeed, in our amended proposal we have already seen fit to add a recital referring to the previously agreed modus vivendi . I regret, however, that the Commission is unable to accept Parliament's proposal that the committee should operate on the basis of the Type II(b) procedure, rather than Type III(a). In our view, there is no reason to confer on the securities committee the power to take urgent decisions, as exists under the Type II(b) procedure. It is our opinion that the Type III(a) procedure is the one best suited to the duties assigned to the committee. For this reason, the Commission is obliged to reject Amendments Nos 2, 6 and 9, all of which relate to the committee procedure. I hope that Parliament will be prepared to reconsider its original position on this matter and lend its backing to the Commission's draft text.
Amendments Nos 1, 7 and 10 are not acceptable, since they propose to abolish the committee's advisory role, which in the Commission's view is its principal function. Amendment No 4 seeks to abolish any reference to the requirement for the new securities committee to cooperate with other committees, such as the banking advisory committee. On the contrary, in the light of the various links between the regulation of credit institutions and investment firms, I would stress the importance of maintaining an explicit reference to such a requirement. It therefore goes without saying that this proposed change cannot be accepted by the Commission.
Finally, I would point out that to accept Amendments Nos 5 and 8 would uncouple the planned system from the directives on investment services and capital adequacy which, pending the establishment of the securities committee, stipulated that certain duties were to be performed by the Council. It would appear advisable that, once this committee is established, it should take on the role originally assigned to it under the two directives which I have mentioned and which, as I said, called specifically for its establishment.

President
Thank you very much, Mr Commissioner.
The debate is closed.
The voting will be held at noon tomorrow.

Resale rights
President
The next item on the agenda is the report drawn up by Mrs Palacio Vallelersundi, drawn up on behalf of the Committee on Legal Affairs and Citizens' Rights, on the proposal for a European Parliament and Council Directive on the resale right for the benefit of the author of an original work of art (COM(96)0097 - C40251/96/0085(COD)) (A4-0030/97).

Palacio Vallelersundi
Mr President, as I open the debate on this report, I feel sure it will become a case study for experts on the process of European integration because rarely, Mr President and Mr Commissioner, has a Community initiative aroused so many contradictory arguments and opposing visions, such fierce defence of legitimate interests, such disparate sensitivities and also such clear positions where ultimately realism and common interest confront fear and special interests. And for that I want to pay tribute to my colleagues on the Committee on Legal Affairs.
The first point I feel bound to approach as rapporteur is the need and justification for this Community action. In line with the treaties, account must be taken both of strictly legal reasons and of economic reasons, with the added difficulty that, in the reality of the market, law and economics form an amalgam which is hard to separate. But we will try.
From the legal point of view, resale right is the inalienable right of all plastic artists, all authors of unique works designed for viewing, to participate in subsequent sales of their creations, excluding the first transmission. This right was introduced in France in 1920 and has been extremely beneficial. The legal arrangements of 11 of the 15 Member States, as well as the Berne Convention, currently include resale right amongst author's rights. So it falls within the scope of intellectual property rights. It is not some kind of tax or duty.
As this is a question of intellectual property it comes under article 100A of the Treaty of the European Community, as established by the Court of Justice ruling of 13 July 1995 in the case of Spain versus the Council. Or to put it another way, the harmonization of resale right contributes to achieving the objectives set out in article 7A of the Treaty on Union for the functioning of the internal market.
After these legal considerations, the economic aspects must be dealt with. The market for contemporary works of art actually consists of two separate markets: one of individual buyers - any of us when we go to an auction or a gallery to buy a picture to hang in our houses - and the other of institutional investors and major collectors on the demand side, and artists of international standing on the supply side.
The latter is also an expanding market because over the last few decades plastic works have become a special safe haven for investments. In a world of growing economic uncertainty, where reference currencies are scarce and unstable, the definitive uniqueness of the original plastic work constitutes a solid reality which often generates outrageous price rises, which are not immune from speculative interests.
It is difficult to define the boundaries of these two markets in terms of prices. From various reports and from conversations and discussions with representatives of artists, galleries and auction houses, I understand that the lower limit of the institutional and collectors' market is located in works whose price fluctuates between ECU 50, 000 and ECU 100, 000. Besides involving these two sub-markets, the purchase and sale of works of art in the European Union has a special feature which we cannot and should not remove: Europe has one of the two main trading centres for great contemporary works of art, London. That is a common heritage for all of us and all of us must therefore preserve it.
We must protect the legitimate interests of plastic artists because recognition of creation and establishment of authors' rights is one of the essential features of European culture. Europe believes creation deserves collective recognition and that, and nothing else, is the ultimate raison d'être of intellectual property. In the case of literary, musical or audiovisual works, there is no controversy in the European Union about the recognition of authors and the establishment of certain specific rights for them by reason of their creations, but the same does not apply to plastic artists for various reasons which I cannot go into in this speech. But I would like to put on record that in the context of the legal development of author's rights, resale right appears to be a kind of devolved right for authors of plastic works, a right related to a value which undoubtedly existed in the work initially, but which progresses with recognition by the collectivity.
But we also have a responsibility to protect the interests of dealers as well as artists, because in the end without either the market would not exist, and the essential interests of dealers cannot be affected without negative repercussions on artists.
I now come to the actual justification for Community action in terms of the specific need for harmonization. In addition to the legal reasons in favour of this initiative, it is hard to sidestep the reality that disparities in national provision on resale right, which does not exist in four Member States, produce distortions in the internal market. Alongside other considerations which figure in the Commission's study, this affirmation is underwritten, in spite of themselves, by the very arguments used by those who claim that the Commission should not act. In fact those who hold that the introduction of a resale right would cause a relocation of sales to centres outside the European Union cannot avoid the fact that this same reasoning, applied inside the European Union, results in centres which do not have resale right attracting sales to the detriment of those located in Member States which do regulate this right.
To summarize this general part, the rapporteur's broad focus on the issues raised, which virtually coincides with the solution adopted by 20 votes in favour and 3 abstentions in the Committee on Legal Affairs, after lengthy debates and hearings of the various interest groups, is that the Commission's initiative is legitimate and perfectly grounded in the text of the treaties. Put another way, the rapporteur, like the Committee on Legal Affairs, regards this directive as justified and necessary, and supports the great principles which inform it. There is just a different emphasis on the need to weigh up the legitimate interests present in the market so that Community regulation does not result in a decrease in competitiveness.
I would like to make one last general comment before briefly dealing with the wording of the proposal for a directive. As rapporteur, I am against the inclusion in the wording of an instruction linking implementation of the directive to the completion of an impact study by the Commission on the economic repercussions of this measure on the market. This is not only because, after the many debates, I do not think reliable data exist to carry out such a study beyond what the Commission has already done, but also because of consistency with this Parliament's function as co-legislator. In my opinion, this amendment would contradict our responsibility under the treaties. The rapporteur and the Committee on Legal Affairs support the Commission's criterion on the duration of resale right and the determination of resale right holders. I would like to clarify this last point, because it is disputed. There is a subsidiarity problem because Member States are responsible for determining right holders and the Community institutions do not have a legal basis under the treaties to limit this right to legitimate heirs. Finally we also agree with the Commission on the threshold of application contemplated in article 3.
As rapporteur, I agree with the Commission on all these points, but I depart from it on certain fundamental points, especially excluding manuscripts from the scope of application of the directive, the need to define the criterion of originality, and excluding what are termed 'promotional sales' in the trade. Above all I urge Members of Parliament, as well as the Commission itself, to think about article 4, the real Gordian Knot of this directive. The rapporteur proposes the adoption of Amendment No 57, tabled by the European People's Party, or the very similar No 21, originating from the Committee on Legal Affairs, as a reasonable solution which responds to the principles constituting the identity of European culture - that is, the protection of artistic creation - and fulfils the purpose of correcting distortions inside the single market and maintaining the competitiveness of the Union in the external market.

Kerr
Mr President, I should like to say that our committee approved the principle of the artists' resale rights unanimously. It is important to bear that in mind. Personally, I consulted widely with artists' organizations, galleries and auction houses on this. Although, as Mr Cox may perhaps say, when he contributes to the debate later, if you wanted to help artists you might not begin from here, we recognize the political reality of Europe: eight Member States already have the legislation, eleven have agreed it and there is a qualified majority in the Council. The job of Parliament here is to try and modify and produce the best result possible, which is what I hope we have done in our report from the Culture Committee. I hope that by voting tomorrow - on a first reading, it is worth remembering - Parliament will actually establish a position which we can then negotiate with the Council and the Commission to make sure that we improve the Directive and then test its impact in the market place.
Mr Cox's amendment is a wrecking amendment suggesting that we have an impact analysis before we have the directive. It seems to me difficult to envisage how you could do that other than by using some economic model. It is just a method of delay. If he was honest, he would admit that.
The arguments of the British Government are well known, but the arguments of the British Government are largely those of Sothebys and Christies. I should point out that Sothebys has recently been found guilty of international art smuggling on a large scale. Therefore, perhaps their word is to be taken at less than face value. They are also owned by an American billionaire, so their European nature is also to be questioned. It is also worth pointing out that the major auction houses have auction houses in New York, Geneva, Hong Kong - they can sell paintings wherever they can get the best return. Again, we should be sceptical of that.
The key, it seems to me, is that the artists themselves want this; a quarter-of-a-million artists in Europe want this Directive for a number of reasons, not least to get back part of their heritage and to understand the nature of their market. We, in Parliament, should be on the side of the artists, not on the side of the auction houses.

Medina Ortega
Mr President, I want to start by congratulating the Commission on this initiative. I think the time has come for the Commission to harmonize artists' intellectual property rights in their work through resale right.
Parliament has done serious work on this proposal for a directive in the Committee on Legal Affairs, and the rapporteur, Mrs Palacio Vallelersundi, has done an excellent job, achieving a very high degree of approval. I think the twenty-odd amendments passed by the Committee on Legal Affairs, and others presented by the Socialist Group, are aimed at improving the text presented by the Commission. I would draw attention to some of them, in particular Amendment No 4, which refers to the international conventions. It is a good thing to harmonize Community law, but if Community law is harmonized and there are countries outside the Community which still fail to grant the authors their intellectual property rights, we will be facing cases of real piracy. At a time when the whole of commercial and services law is being harmonized, consideration must be given to the appropriateness of drawing up an international convention which removes the reference in the Berne Convention to resale right as a purely optional right.
I also want to draw the Commission's attention to Amendments Nos 2, 3 and 18 - as well as part of Amendment No 9 - which define the scope of resale right to exclude manuscripts, but deal with resale right in a work which has a certain originality and is intended to be viewed.
So we are talking about a work which is an expression of creation and therefore the intellectual property right is protected. Finally, Mr President, I hope that the amendments from the Committee on Legal Affairs and some of the socialist amendments, which we hope will be approved, can rely on Commission support at the second stage of approval by the Council.

Mosiek-Urbahn
Mr President, ladies and gentlemen, I should firstly like to congratulate the rapporteur on the stamina and patience which she has shown in drawing up her report. With this report, she has presented a very balanced and practical final document. In the light of the closing discussions in the Committee on Legal Affairs and Citizens' Rights, I should like to emphasize in particular once again that resale rights are a matter of copyright in favour of the artist, and not a tax to benefit the Member States. I think this is a very important point to make.
The discussions revolved around two issues in particular: whether we need to harmonize resale rights at all; and, if so, how these rights should then be expressed in terms of percentages for each band.
The first question - do we need to harmonize resale rights - can clearly be answered in the affirmative. Where art is concerned, the European internal market is characterized by extremes. We have some Member States where there are no resale rights, and others where there is a right of 5 %. We need this harmonization.
The main arguments against are as follows. Resale rights or administering them would consume the proceeds. The response is that this can be countered by the rapporteur's balanced proposal that the rights should apply only from a threshold of ECU 1000. Also, many of the systems currently in operation serve to undermine this argument.
Another argument which is repeatedly put forward, namely that the art market would migrate to the United States, cannot be sustained. There are already resale rights in California, and efforts are in fact being made in the USA to introduce them throughout the country.
Turning to the bands and the percentages for resale rights, there are major differences in the Member States. We spent a great deal of time discussing where to draw a line that was justified on practical grounds, but came to the conclusion that the threshold of ECU 1000 is one which is justified, taking all the counter-arguments into account, and it should be maintained. The upper rate is also in keeping with the realities of the art market and the interests of the artists involved.

Schaffner
Mr President, this proposal for a directive aims to eliminate major legal disparities between the States, from the absence of resale rights in the United Kingdom and the Netherlands, to the highest rates in Portugal. The Commission, using this disparity, has attempted an average proposal forgetting that, in certain States, the resale right appears in texts, but has no application in fact, forgetting that in some countries in the Union no true art market exists, or exists any longer.
The Committee on Legal Affairs, through the impetus of Mrs Palacio, has attempted a more realistic approach. Certainly, there is no question of depriving the artist of a genuine resale right over his work: the resale right is a way of letting the artist benefit from the added value which his work gains over time and providing him with an appropriate and uniform level of protection. But the reality of the figures is implacable: less than 10 % of resale rights benefit artists who are still alive.
What is more, far from favouring young artists, the resale right has a perverse effect. It lowers the price which the potential buyer is prepared to pay and, for the work of contemporary artists who are already highly rated, it encourages sellers to go abroad. Today, they go to London or Geneva, but once harmonisation has been achieved under the current conditions of the proposal, it could be feared that the market will move to New York, thus eliminating any art market worthy of the name in the Union. So, the objective of social protection which the European legislator has set itself will not be achieved.
It seems to me equally important to put in place a significant resale right for the works of artists who are starting out or who are little known, as it is to set the resale right for internationally renowned artists close to zero, insignificant, since the cost of relocating the sale is derisory in comparison with the right which may be earned. In this domain, as in many others, let us refrain from an excess of zeal, the better being the enemy of the good.

Thors
Mr President, I would like to see young artists given good opportunities to work in Europe. I would like to see the results of their work here. I would like to see a smoothly functioning art market which offers returns which can then be used to benefit the artists. This will be achieved if we have many different art dealers and galleries and through reliable art dealers.
If we were to have internationally binding regulations and resale rights which applied in every country which had signed the Copyright Convention the situation would be different. Then we could support this Directive, but that is not the case today. I can assure Mr Kerr that experience from countries other than Great Britain has shown the consequences of the introduction of resale rights. This was introduced in my country and now it can now be seen that art dealing does not take place through reliable art dealers and auction houses i.e. it takes place on a grey market which is not a good situation.
Another consequence of resale rights is that the galleries have started to experience an even tougher time and are finding it difficult to operate, which means that the prices which they are able to offer young artists have gone down. As we have said, it is not the young artists which will benefit from this, a point which was made very well, I thought, by Ms Schaffner.
We in the liberal group want to see the principle of subsidiarity respected which is another reason why many of us are critical towards this proposal. We want to see a critical examination of whether the proposed Directive really will lead to an improvement in community principles and if there really are 'dysfunctions' in the market which require regulating.
After all there are no international binding standards which force us to adopt this legislation. We do not think that the Commission has demonstrated the need for a Directive convincingly or that the lack of a Directive would cause serious disruption.
Let me say - even if Mrs Mosiek-Urbahn has said that this should not be compared with a tax - that those who maintain that resale rights are required for the internal market should also demand a standard income tax in the Union. For our part, we do not think that the Directive should be introduced until the Commission has drawn up and presented a thorough impact analysis of how the art market really functions and how it functions with respect to third countries. Such a study I hope would also give an insight into how the diversity of the art market would be affected. It is as much in the interests of the buyer as of the artist to ensure that there is diversity of players and that there is true competition. At the same time it is obvious that the proposal will not lead to improvements for artists in those countries where resale rights already exist.

Sierra González
Mr President, the lack of legal harmonization in artists' rights to participate in the benefits generated by their work is currently distorting competition and undermining the proper functioning of the internal market. This proposal for a directive should be understood as an attempt to put an end to this perverse situation, and it is high time to do so. The Commission is seeking to regulate transactions which give rise to payment, the threshold for the application of the right and the type of resale right.
We agree with the choice of issues that require regulation and also with the generic proposal which inspires the directive. What we are not convinced about is whether it adequately matches the requirements of the internal market and the protection of the artists' living and working conditions. We harbour these doubts because of the method of regulating practical aspects of the exercise of resale right. We disagree with some of the measures put together to regulate this, like the minimum thresholds and the percentages to be received by the artists when their work is resold.
On the first point, we think the minimum threshold is extremely restrictive, and if it is not reduced artists whose works are less well known or valued and give rise to modest economic transactions will remain outside the scope of resale right. This would enshrine an exclusion which we think should be put right by reducing the minimum threshold to extend the exercise of resale right to the greatest number of artists. As regards the percentages, it is claimed that these measures give the artist a share in the profits earned by his work. It seems common sense to increase the percentages, otherwise the redistribution will be more symbolic than real. So we support the amendments proposing an increase in the percentages. Finally, I want to point out that the objective of the directive should be cultural as well as economic. We believe it must aspire to strengthen artistic creation, which is and always has been one of the identifying marks of European culture.

Ullmann
Mr President, ladies and gentlemen, since this proposal for a directive has been the object of sometimes violent criticism, I should like to return to the question of the legal basis - not the one contained in the Union Treaty, which the rapporteur has explained adequately tonight, but rather two urgent legislative needs which this proposal seeks to meet.
The first - and here I agree with the previous speakers - is the ending of a market distortion based on legal differences originating from markets which have a privileged position because of national legislation, since they do not have to take account of resale rights. There was only one way to correct this false situation, namely to introduce a resale right throughout the Union, with all the consequences that entails. An area without internal borders must also be a market without privileges.
The other urgent need lies in the unequal treatment of creative artists, as opposed to writers and musicians. While the latter are protected by copyright against economic fluctuations and the vagaries of the market, creative artists are at the mercy of the marketing strategies of the art trade, if they do not yet have a personal reputation and the influence that goes with it. In this context, resale rights serve as partial compensation, and as acknowledgement of a right which cannot be denied to these artists.
I should like to make one further comment on the amendment on resale rights which I have tabled, together with other Members. Our purpose here is to follow as far as possible both the Commission's proposals and the ideas from the artists' associations. Finally, I should like to thank the Commission for its bold initiative, the rapporteur for the determination and the caution with which she has approached the issue, and the draftsman of the opinion of the Committee on Culture for his contribution.

Krarup
This proposal on the resale right sends out a very clear political message, and that is quite simply the European Union's insatiable desire for expansion, or to put it in EU speech: the proposal violates both the principle of subsidiarity and the principle of proportionality.
What is at the forefront of the debate, and what gives weight to the proposal - looked at in rational terms - is a concern about the distortion of competitiveness in that some countries have this resale right, and others do not. But the existing research shows that the resale right has effect firstly on sales in the country of sale when the work of art in question has a sale price of at least 50, 000 ECUs. When it comes to less valuable works of art, due to transport and insurance costs, it may simply not be worthwhile selling elsewhere in order to avoid the resale right. The existing reports refer to an examination of the sale prices of works of art which indicate that 95 % of works of art are sold at prices under around 20, 000 ECUs, that is to say $25, 000. In other words, the attempts at harmonization contained in the proposal are targeted at under 5 %, probably only 2-3 %, of combined sales. In all essential respects the resale right is a national matter and that is what it should remain.
For Scandinavian artists, where we have had the resale right - in Denmark's case for several years - the proposal simply means a significant reduction. Scandinavian artists have, in a joint statement, protested against the proposal and this reduction, which Marianne Eriksson will be addressing in a subsequent speech.
My conclusion to this is that, speaking for myself and for the group, I am able to support Mr Cox's amendment which is aimed at simplicity and seeks an assessment of the need, particularly amendment No 40.

Cot
Mr President, I want to pay homage to the Commission which has introduced this necessary draft and especially to Mrs Palacio, who has invested a great deal in this matter and has shown evidence of remarkable qualities, even if hers was at times a thankless task.
I think our Commission has produced a profound piece of work. It has held hearings, consultations and long debates. The conclusions I would draw from it are as follows.
Firstly, there must be a harmonisation of the resale right. This right exists in certain States; it does not exist in others. This situation distorts the internal market. It is important that the result of our deliberations is an agreement on the principle of the resale right, even if the rate may be modest, or even minimal where the lowest rate is concerned.
Secondly, the need for the legitimate remuneration of artists, and particularly young artists, must be recognised for works of art which are not of very great financial importance.
Thirdly, we do not have the right to misjudge the globalisation of the art market and the effects of relocation, today to London, tomorrow to New York, Tokyo or elsewhere.
The socialist group has taken these elements into account, which have led it to propose a wide range of rates, going from 5 % for modest works to ensure the adequate remuneration of young artists or works of art by nature not very commercial, to 1 % for more important works. I would like to make it clear that the rate of 1 % has not been accepted, but it has not been disputed in principle, Mr Kerr, by the representatives of the large British houses you have cited and who were present at our hearing. So, we think there should be a wide spread as far as rates are concerned. In the same way, we think that thresholds should start at 500 Ecus and go up to 250, 000 Ecus, that is, to widen the range put forward by the Commission.
I note that there is some difficulty over agreement - including within my group - because of the diversity of traditions and interests. I will put the question which we will have to ask ourselves at some point: do we, or do we not, want a directive? I hope, for my part, that a substantial majority of you will stand out for the proposals presented. Otherwise, I am afraid that by letting things go we will see worse relocations, to the detriment of artists as well as to all the intermediaries and other active parties in the art market in Europe.

McIntosh
Mr President, I should like to congratulate the rapporteur on the work she has undertaken. The fact that I disagree with her in no way detracts from the hard work she has put in on this report. My starting point is simply this. Article 108 of the Treaty is an erroneous Treaty base. This is not a harmonization measure. Indeed, the case for harmonization has not been proved. If the objective were to be harmonization then both the Commission directive and the Palacio Vallelersundi report would fail to hit the mark.
The actual effect of a measure such as that before us tonight will clearly be to drive this art business out of Europe completely and into the welcoming arms of Switzerland and New York. In any event, as Mr Krarup has said, these proposals lack proportionality. I would remind the House that if you look at the market in France alone, 75 % of the droit de suite raised goes to only six families. In my view the principle of subsidiarity should clearly apply here.
I would draw the attention of both the Commission and the House to the fact that three Member State governments are clearly against the application of this directive. These are Ireland, Holland and the United Kingdom. There are several reasons for this: the principle of subsidiarity to which I have already referred; the fact that harmonization in this case is simply not justified; thirdly, there is no convincing evidence that the absence of the right in some Member States and the difference between other Member States creates barriers to trade. Artists' resale rights should be left to national law.
I would also add that the main international copyright convention - the Berne Convention - to which all Member States are party, gives freedom whether or not to apply this right. This freedom must be respected. The costs and risk involved far outweigh any conceivable benefits. Before the present proposals and Mrs Palacio Vallelersundi's report enter into force, the Commission must conduct and report on a complete evaluation of the impact on the market of resale of the works of art in both the European Union and between the European Union and third countries. This report should be examined by the Council and the European Parliament should be consulted on it.
I would like to make a forecast. If this directive and the amendments tabled to the Palacio Vallelersundi report were adopted, it would result in a net loss to the European Union - a loss of earnings and jobs in the European Union. We simply cannot afford to let that happen. So, in the words of Mr Kerr, I conclude by saying: Let the market decide and let the market be. Like a previous speaker, I commend to the House the amendments tabled by Mr Cox, in particular Amendment No 40. We should vote these amendments through and not those tabled by Mrs Palacio Vallelersundi and other colleagues or indeed the Commission report.
There are huge potential job losses and a huge loss of income to all Member States and I regret that while Mr Kerr said that he conducted a very full inquiry, in fact he did not go to all the art galleries in the United Kingdom so they could have benefited from his contribution tonight.

Ryynänen
Mr President, in my opinion it is undeniable that the current situation with regard to resale rights in respect of works of art is unsatisfactory and is causing distortions of competition on the modern art market. However, the main problem stems from the differing legal positions of artists in those countries where they sell their works. A further cause of inequality is the situation of visual artists by comparison with other artists whose right to payment of royalties for repeated uses of their works is guaranteed everywhere.
The consideration of the directive gave rise to a justified criticism of the so-called threshold level. There is a risk that only established artists or their heirs will benefit from the rights in question. This is why I support the reduction in the threshold value to ECU 500, as proposed by the Committee on Culture, and a higher level of compensation in the lowest price category, since this would help and encourage new young artists.
The elimination of red tape and the application of the subsidiarity principle must be encouraged everywhere where such measures are justified and feasible. However, the harmonization of resale rights is justified precisely because it will help bring about more equal treatment of artists. This harmonization must be carried out in such a way as to encourage artists and the arts in general.

Eriksson
Mr President, unfortunately I cannot pass on my congratulations for this report although I know that a great deal of hard work has gone into it. But it is our view that this proposed Directive contains regulations which are more far-reaching than required to achieve the stated objective.
If this Directive is adopted it will be necessary not only for the three Scandinavian Member countries of Sweden, Finland and Denmark but also for Norway and Iceland to amend their existing legislation. This change will bring about a marked deterioration in the rights which Scandinavian artists in the five countries enjoy under existing National statutes.
The Directive, in its current format, takes no account of small national markets. It has been drawn up with no regard for the conditions in the Scandinavian countries. If the Directive is adopted in its current format it will mean, in the case of Sweden, that working artists will not for the most part be eligible for remuneration and that instead this will be a benefit to well known foreign artists. Total remuneration would be halved while administration costs would rise considerably. As I am running out of time to speak, I refer you to my proposed amendment and would unfortunately, as we say in Sweden, ask that both the Commission and the Committee do their homework again.

Barzanti
Mr President, the European Union's cultural policy is marking time: it is not experiencing a happy period, to put it mildly; there is insufficient will to promote it, and a lack of funds to implement it. So it is crucial that the legislative framework, which is necessary if there is to be a real single market, should at least take due account of the particular nature of artworks - plastic artworks, in this case - and should actively support all forms of creativity.
Moreover, our enthusiastic support for the extension, judicious harmonization and proper application of resale rights stems from a policy line which we have always vociferously advocated. Mrs Palacio's fine report records the outcome of intense debate within the Committee on Legal Affairs, and expresses full approval - which I endorse - of the proposal which the Commissioner has been bold enough to present. It is quite proper to recognize the rights - and we are not talking here about a hand-out - of those who produce works for which they often receive an initial payment that is out of all proportion to their subsequent market value. So the practical fruits of their success should not result in the exclusive and far superior gain of dealers and large galleries, but should also benefit the original authors on an appropriate scale, be they young or not-so-young. We are therefore hoping for a broad consensus in the vote in Parliament, and we particularly support Amendments Nos 53, 54 and 55, which are key ones. We shall struggle hard to defeat the specious arguments which will undoubtedly be put forward to block a long-awaited directive which is both necessary and useful, in order to ensure that a significant part of the market is governed with due regard for original, unique, unreproducible artworks that are an essential reflection of the imagination and traditions of the Europe which we hold so dear.

Casini, Carlo
Mr President, I too would like to pay my compliments to Mrs Palacio: I am not complimenting her merely for the sake of form, but because I am in full agreement with her report. Like Mr Barzanti, I too hope that it will be widely supported in the House.
I believe that everything has already been said, in particular by Mrs Palacio, so I shall confine myself to just one comment. Ultimately, the difference of opinion seems to me to relate neither to the details, nor to the threshold, nor to the percentages, but to whether or not resale rights should exist at all. And therefore, since mention has even been made of markets, competition and a possible shift of sales outlets from the European to the American continent, I feel duty bound to say that, above all else, this is a question of justice. We are talking here about intellectual property, in other words the ownership of something intangible and imponderable - ideas. And a figurative artist's idea has one specific characteristic: the idea cannot be cloned, to use the latest jargon. A novelist's idea can, in a sense, be cloned, in that hundreds, thousands or even hundreds of thousands of copies of a book can be produced and marketed. The same also applies more or less to a musical work, but a figurative artist produces one copy only. The idea remains in that form and the owner, the holder of the intellectual property, always remains the same because the idea cannot be sold. There then arises the question as to the usage of that idea, of which at least two features differ from that of a novelist, to stay with that comparison. The initial sale of a book involves high production costs, and its author receives a percentage, whereas the creator of a figurative artwork receives almost the entire proceeds of the first sale. But whereas, at a later stage, the sale of multiple copies of a book enables the author to benefit further from its value, an artwork gains in value by being passed from person to person, by becoming known and being seen; in other words, the original has to move about, and its value is linked to its circulation. It therefore seems to me that it is a question of elementary justice to give the owner of the idea, the artist, an equivalent economic advantage, and that is precisely what resale rights do.
I do not believe that, beyond the threshold percentage, it is legitimate to deprive artists of these rights. I do not intend to dwell on the detailed objections which have been raised, since some of them strike me as relatively unimportant; the basic issue as I have explained it is, I think, a convincing argument for the adoption of Mrs Palacio's report.

Gebhardt
Mr President, ladies and gentlemen, I should first like to make a point of thanking the Commission for taking this initiative. I think that what is happening here is very important. This directive is a very important one. The differences between rules in the EU are obstructing the internal market and the equal treatment of artists in the Union. It is completely unfair if a British person who sells a work in Germany or Portugal obtains resale rights, but a Portuguese or German person does not obtain such rights in the United Kingdom if they sell a work there. This injustice must be eliminated, especially in such a sensitive area.
What is actually the point at issue here? It is to involve artists in the resale of their work. That is not too much to ask, when one considers that in Germany, for example, artists have an income of around DM 2000. People cannot live on that. The market and market conditions are extremely tough for artists. Half the sale price goes to the gallery owner or art dealer, and it is not asking too much for these dealers or owners to hand over part of the proceeds when they resell these works.
Particularly important here is the fact that this contribution is especially high for the young artists who are not yet well known and do not have so many opportunities. That is why it is so important for us as socialists and social democrats that the 5 % rate for resale rights should apply to the lowest band. We set great store by this, and by having this band begin at ECU 500.
There is another problem with Amendment No 57. This concerns these narrow price bands which are being envisaged. There are in fact only a few works involved here, and the auctioneers in France have worked out for us that all of 120 works are sold for more than ECU 250 000 each year. So this means that in general terms there cannot really be enormous sums of money involved, but it is of course a great deal of money for the individual artists. I also think that the Commission's proposal is a very good one. If we take a work which costs ECU 110 000, then under the Commission's proposal or our own, the artist would receive ECU 3300; under the rapporteur's proposal, it would be all of ECU 1100. Is that fair? And do you believe that for the sake of ECU 3300, works will migrate to the United States, when you think of the cost of insurance and transport? I hardly think so! I would therefore call for this generous scheme to be adopted, without too many disadvantages being created for German artists, who are in fact used to always receiving 5 %.

Vaz da Silva
Mr President, copyright is one sector in which subsidiarity demands - rather than allows - Community intervention. Only if copyright is harmonized will it be possible for all forms of art to circulate freely. I am referring both to a single original work of art, as in the case of the plastic arts which we are discussing today, and to works which are reproduced such as books, records and audio-visual material. We should not however forget that multimedia communications are opening up new avenues for the reproduction of works within the plastic arts. Resale rights are particularly important in relation to artists in the field of the plastic arts, who are the least protected of creative artists in this matter owing to the unique and un-reproducible nature of their works.
The Palacio Vallelersundi report is a serious and balanced piece of work, since it tries to reconcile the various conflicting interests - those of the dealers and those of the artists. The Berne Convention leaves it to the discretion of the signatory states whether or not to adopt this resale right, so instead of being a right recognized by eleven signatory states, it is in practice applied badly in practically all of them. The United Kingdom, which together with the United States has an eighty per cent share of the international art market, is one of the four states which never incorporated this right into its legislation.
There are two reasons which make it urgent to harmonize laws in this field. First when the internal market becomes fully operational equal conditions for purchase and sale will be required throughout the Community territory, even to prevent the art market from shifting to non-member countries. Secondly but no less important, the recognition of the social role of the arts as a force for development which should take the form of the setting up of support mechanisms for artists. Since the law in Portugal is considerably more severe than the present proposal for a directive, I should like to stress the clear advantage of giving consideration to the following amendments proposed by the Committee on Culture which reflect the unanimous concerns of artists: the lowering of the minimum threshold for the application of the provisions of Article 3; the amending of the sliding scale of percentages provided for in Article 4; the promotion of the joint administration of the right provided for in Article 6. I should also like to point out, as I have done on so many occasions, that it is again clear that Article 128 should be amended so that it can be used as a basis for any texts with a bearing on culture. This is the only way to bring coherence and uniformity to cultural policy in the Union.

Rothley
Mr President, I should first like to congratulate the rapporteur, who has done an excellent job as always. After the compliments, let us now get down to the facts. It is only too easy to take up the cause of artists, but out of all the resale rights, just 9 % goes to living artists, 9 %! The other 91 % goes to holders of rights and successors in title, and 9 % to living artists!
No mention has been made of this. Nor does the Commission mention it in its proposals. Furthermore, the dealers naturally also make money out of this system, between 10 and 20 % in fact, and that is why they are campaigning so vigorously as well. The people who receive the least are the living artists. That will be reinforced by the Commission's proposal. Clearly, harmonization is required. To get down to the facts, I should like to give an example of how what the Legal Affairs Committee is proposing would actually have worked out over the last 25 years. I should be glad to provide details of the source on which this is based, but that would take too much time now - it is a very thorough piece of work.
So, let us go back to 1970 and the market in the United Kingdom, where 3072 works have since been sold for more than ECU 100 000. In the same period, 1970 to 1996, 3630 such works were sold in the United States. So this is a very tight market, with very tough competition. If we had had the proposal from the Legal Affairs Committee - let alone the incredible proposals which go beyond that, just the Legal Affairs Committee's proposal - then these 3072 works which were sold for more than ECU 100 000 would have cost the European market ECU 1 033 856 359. Do you still seriously think that this would not have led to a relocation of the market? Do you still seriously think that with such a cost to the market, sales would just have carried on cheerfully in Europe? Such an idea is madness! You will ensure that no more works by Picasso or Van Gogh are sold in the European Union, that nothing at all is sold, and that art is no longer talked about in the EU. That is what will happen!

Mouskouri
Mr President, Commissioner, ladies and gentlemen, I would like first of all to compliment the rapporteur on her report and to offer her my support.
Harmonization of the resale right for the benefit of authors in the European Union seems to me a very good and justifiable initiative. Unfortunately, it is encountering strong opposition. On the one hand, this opposition stems frequently from ignorance about the actual underlying basis for the right and, on the other, from worry about a major movement of sales of art works to other countries in which the right is not applicable.
The underlying basis for the right is the desire to lessen the injustice suffered by the authors of certain original works of art which are destined to become objects of viewing. As things stand, such authors, unlike other authors, are not able to benefit from revenues accrued through reproduction rights and the renewed presentation of their work.
We should appreciate that the resale right is actually a right of the author and not a tax, as the opponents would have it. It is a right which is exercised for the benefit of the author and not for the benefit of some public authority. Furthermore, it is recognized as such in Article 14 of the Berne Convention.
As regards the danger of a transfer of art work sales to countries which do not recognize this right, it does not appear to be very acute. In actual fact, the situation should not change very much, given that the regressive scale of percentages applied to successive categories of the sale price makes export of little interest when, for example, transport and security costs are taken into account. It also has to be said that the existence or otherwise of this resale right is not a definitive factor as regards the movement of transactions, but rather one factor among others. As far as the United Kingdom is concerned, the danger of a move by the market is small, because what the world is looking for when it goes to London is the experience of professionals in the field and their traditional technical expertise, and it knows that it will find guarantees of quality and security there for its transactions.
That said, I draw attention to the fact that the proposed harmonization can only fulfil its true role if it can be ensured that the Member States will implement the resale right down to the last detail, which in many Member States is not done at present.
In finishing I would like to stress that the international dimension of the art market must of necessity be taken into account. If the European experience in this field proves positive for the development of the art market generally, and for the promotion of new artists in particular, we must direct our efforts to making this right obligatory in all countries, given that the Berne Convention at present provides only for the possibility of the Member States introducing it into their legislation.

Oddy
Mr President, I am speaking on behalf of the British European Parliamentary Labour Party. I wish to make it clear that we are not against artists. We are just not convinced that the case has been made for this specific proposal and that it will actually help artists. We are concerned that the art market may move to New York and to Switzerland. We are concerned about potential threats to jobs. We are worried about the burden on smalland medium-sized businesses. We are concerned that small antique and art shops in tourist areas may have difficulty as a result of this proposal.
Consequently, my group will be supporting Mr Cox's amendment, requiring an impact assessment on the art resale market. I am particularly concerned that the Commission has not fully thought through the definition of plastic arts and the extent to which extra-territorial effects will affect this proposal.
My group is not in favour of reducing the threshold to 500 because of the burden on small- and medium-sized businesses, nor are we in favour of increasing the percentages. My group will be abstaining on the final vote as we are simply not convinced that the Commission has properly made the case for harmonization in this area.

Monti
Mr President, ladies and gentlemen, on behalf of the Commission, I would commend Mrs Palacio and Mr Kerr on their hard and meticulous work in presenting to the Committee on Legal Affairs and Citizens' Rights and the Committee on Culture, Youth, Education and the Media such a comprehensive report on a matter which is crucial to the completion of the internal market in the art sector. As the many speakers have indicated, the aim of this proposal for a directive is to eliminate distortions of competition by extending and harmonizing resale rights throughout the entire Community, and to put an end to the discriminatory treatment suffered by the authors of modern artworks. The Commission therefore attaches considerable importance to this initiative, which does not stand alone but is connected with other measures adopted by the Commission to liberalize the art market.
The Commission can accept nearly all the amendments tabled by the Legal Affairs Committee. The only substantive amendment which, on grounds of principle, it intends to reject at this stage concerns the percentage rates of resale rights laid down in Article 4 of the proposed directive. Nor can the Commission accept certain other amendments, from various political groups and individual Members, which are designed to modify the minimum threshold for the application of resale rights, reducing or increasing the percentages to be applied and changing the proposed price bands.
The same applies to the proposal to calculate resale rights on the basis of added value, in other words the difference between the resale price and the sum paid to purchase the work. The few cases in which attempts have been made to apply similar systems in the past - ones based on added value - have proved unsuccessful as a result of practical problems.
Furthermore, the Commission cannot agree to refrain from harmonizing the categories of works or transactions to which resale rights apply. To leave such matters to the discretion of the Member States would conflict with the goals of the internal market in the modern art sector. I would point out that, generally speaking, art galleries should be subject to resale rights in exactly the same way as any other commercial trader in twentieth-century art. The proposed derogation in favour of commercial transactions taking place within three years of the trader having acquired the work is similarly unacceptable.
I regret that, on grounds of constitutional law, it is not possible after the artist's death to restrict the benefit of resale rights to his or her legitimate heirs.
Finally, the Commission has to reject various amendments seeking to insert in a Community act recitals which state that this same act should not be adopted.
With regard to Amendment No 40, which would make the directive's entry into force contingent on a further assessment by the Commission of the impact on the art resale market - an assessment to be validated by the other Community institutions involved in the legislative process - I must point out that this does not accurately reflect the institutional balance established by the Treaty on European Union.
I am convinced that in a second phase we shall be able to reach complete agreement on this proposal, taking account of all the potential risks for the future art market in Europe.
I thank you once again for a discussion which I personally have found very interesting, because it has highlighted both the complexity of this proposal and the gap which the proposal is designed to fill.

President
Thank you very much, Mr Commissioner Monti.
The debate is closed.
The voting will take place at noon tomorrow.

Masses and dimensions of motor vehicles
President
The next item on the agenda is Mr Barton's recommendation for a second reading on behalf of the Committee on Economic and Monetary Affairs and Industrial Policy on the common position adopted by the Council with a view to the adoption of a European Parliament and Council Directive on the masses and dimensions of certain categories of motor vehicles and their trailers and amending Directive 70/156/EEC (C4-0632/96-00/0348(COD)) (A4-0102/97).

Barton
Mr President, thank you for that very catchy introduction to this report. Some years ago we set out to get a Europe-wide agreement on the masses and dimensions of certain vehicles and their trailers in order to create free movement and the single market and all the advantages that will give the citizen. We have to note that much progress has been made in this whole area. A clear agreement on this item would have completed that process but to this day the final stage eludes us.
Unfortunately the Council has not been able to bring forward specific measures that would finally complete the process. Some five years after our first reading all that is now available to us is a common process as to how the national authorities should go about deciding these limits, the maximum permitted values. The hope and expectation is that this will eventually lead to harmonized results because of using the common process. It is regrettable that we cannot yet achieve that full agreement.
This report has to reflect that reality. It is no use our dreaming about these items. We make two 'friendly' amendments in the report. These require that when national authorities are using this procedure they give high regard to the safety factors. I would remind the Commission and Council of the concerns the European Parliament expressed in this regard at first reading, particularly as regards the use of trailers up to 750 kilogrammes without the need for those same trailers to have braking systems. Parliament has very real concerns about that. We have not tabled an amendment because the procedure dictates that should be decided at national level - at least in the intervening period.
I sincerely hope that the Council and Commission can also take on board our constructive amendments in this regard. Hopefully, the Council and Commission will be able to inform the House that the matter will be kept under review, and if this process is not seen to be producing the required results within two years or an indication that it will be successful, we would expect the Commission to bring forward fresh proposals to accelerate that process.
Some Scandinavian MEPs have rightly raised the matter of their concerns about specialist vehicles, especially in the forestry industry. The question they raise is will European harmonization jeopardize their right to operate their specialist vehicles? The simple and short answer from this Parliament is that no such danger exists. Whichever procedure we use to decide the European standards, they in no way stop the national authorities from approving the use of specialist vehicles as they see fit. The only restriction is that those vehicles do not have the right to free movement to operate in the rest of Europe.
In conclusion, I hope we can now proceed with this proposal and that citizens will soon get the benefits of a safe single market in vehicles and their trailers.

Monti
Mr President, ladies and gentlemen, I am grateful to Mr Barton for his excellent report on this proposal for a directive on the masses and dimensions of certain categories of motor vehicles and their trailers. The Commission welcomes both of Mr Barton's amendments, subject to a few minor changes of wording.
I would also inform the House that the Commission is prepared, if necessary, to re-examine the situation regarding vehicle safety in two years' time. I must thank the House for its work on this directive, which is an important step towards harmonizing the legislation of the Member States on the type-approval of vehicles and their trailers, with the exception of motor cars, in respect of their masses and dimensions. There is every likelihood that the proposal will be adopted and can thus be ready to be applied by manufacturers prior to the entry into force of the directive, which is scheduled for two years after the adoption of the proposal.
I very much hope that Parliament will adopt the proposal at second reading, as Mr Barton has said.

Barton
Mr President, I am very happy with the Commissioner's response. I hope that the textual changes referred to do not mean that we have to take the matter into conciliation. I would remind the Commissioner that we discussed these matters previously and amended the wording to try and accommodate the Commission. I am sure it is not the intention of the Commission that we should have to activate the conciliation procedure. If the textual changes that you now seem to believe would be necessary can be agreed without activating that procedure, I have no problem. If it would activate the procedure I would ask the Commission to think again.

Monti
I will now read out the proposed changes. I hope the rapporteur will agree on the definition of 'minor' , that I took the liberty to use. We would like to see changed in Recital 6 - let me read the last four lines which at present say: ' ... and to pursue the constant improvement of safety, in particular regarding to the use of certain categories of carriages or trailers' . We would like it to read: ' ... and to pursue the constant improvement of safety, in particular regarding certain categories of trailers' . This would imply deleting the words 'to the use of' and the words 'carriages or' . I hope this is considered to be minor.

President
Thank you very much, Mr Commissioner.
The debate is closed.
The voting will take place tomorrow, Wednesday, at noon.
(The sitting was suspended at 11.27 p.m.)

