Resumption of the session
President
I declare resumed the session of the European Parliament adjourned on 16 May 1997.

Approval of the Minutes
President
The Minutes of the previous part-session have been distributed.
Are there any comments?

Marset Campos
Mr President, I regret that I have to protest again to the plenary - as I also had to do last time, in Strasbourg - at the burning, in Montpellier, yesterday, of a lorry from Murcia, bound for Russia, with a load of chewing gum.
What is occurring is very serious and I would like you to intervene to restore the freedom of circulation of goods.

President
Thank you, Mr Marset, we shall take note of this protest and, of course, it will be passed on at once.

Macartney
Mr President, the first item on the order of business is a communication from the Commission on urgent political matters of major importance. I wish to raise a matter which has been excluded from the agenda, namely the question of Norwegian salmon dumping and the salmon subsidy. The Norwegians have been proved guilty and the penalty should be notified by the end of this week. I want to the Commissioner to tell us what is happening. We have heard nothing. Apparently certain committees of this House are able to place certain topics on the agenda under this item which means that ordinary Members cannot raise others.

President
Mr Macartney, you know perfectly well what the rules are on the procedure for asking questions of this type.

Andrews
Mr President, you will recall that since Christmas this House has taken a special interest in the case of Roisín McAliskey who was incarcerated in Holloway Prison in England. She has now given birth to her baby and is out on temporary bail. Following the visit by Mrs d'Ancona on a personal basis, I would ask you to intervene with the new British Home Secretary to give her bail so that she can return home with her child, as evidence of the compassion that Tony Blair and the Socialists promised in this particular case during the election.

President
Mr Andrews, this is not the time or way for expressing your opinions on the subject. I repeat that I want to know if there are any comments about the minutes of the previous part-session.

Killilea
Mr President, on a point of order. Arising from what Mr Macartney raised concerning the Norwegian salmon deal and taking into account its serious implications right across the EU, could you explain to me how, as Members, we could raise that matter and sound the alarm in this House. What Rule do we use? How is it done?

President
Mr Killilea, you are a veteran parliamentarian and you know the rules governing the way in which you should ask questions of this kind - and this is not a point of order at this moment in time.
However, it is not for me to have to tell you - you know the rules sufficiently well.
(The Minutes were approved)

Agenda
President
I have been informed that Council commitments prevent it from being present before 5 p.m..
I therefore propose that we begin with the joint debate on the Christodoulou and Randzio-Plath reports at 4 p.m., and adjourn it for the debate on the European Council of 23 May 1997, and then resume it once that debate is over, i.e. between 6 and 6.30 p.m.
Are there any objections?
(Parliament agreed to this proposal)

President
The Union for Europe Group and Group of the European People's Party have asked for the Tomlinson report, on behalf of the Committee on Budgets, on the estimates of revenue and expenditure of the European Parliament and the estimates of revenue and expenditure of the Ombudsman for the 1998 financial year, to be postponed to the June II part-session pursuant to Rule 131. Although they could have put their request when the debate began, I thought it more correct to consider it now, as there are more members present.
I give the floor to Mrs Oomen-Ruijten, to move the request.

Oomen-Ruijten
Mr President, I should like to propose on the basis of Rule 96 that you should take the Tomlinson report off today's agenda and reschedule it for the second June part-session. The reason for this - and I understand that Mr Pasty has tabled a similar proposal - is that it deals with a number of highly sensitive issues that were voted through in the Committee on Budgets, but which we know only ever receive a very small majority in Parliament. Our groups are not entirely happy with the outcome of the votes on these issues in the committee.
Let me give you a few examples. Take the funding system for the political parties. I had understood that the group chairmen had reached agreement on a number of points which are unfortunately not included in the Tomlinson report, and we would like the chairmen and indeed the groups themselves to have the chance to discuss these in detail.
Then there is also the proposal on the Strasbourg part-sessions, which is something we really should leave well alone, it is such a sensitive issue.
Thirdly, and this is something else we have to consider, there is the letter we have all received from the Staff Committee, which says that the Committee on Budgets' proposals on fringe benefits could have serious consequences for staff. We should at least have the chance to discuss this in the groups.
I also note that the Bureau did not vote today. For some reason, it was not able to. The coordination with the group leaders on all the proposals has also not been as it should be. This, together with the fact that so many of our French and Irish colleagues are not here today, is why we would urge you to postpone the report to the second part-session in June.

Fabre-Aubrespy
Mr President, on behalf of my group, the Group for a Europe of Nations, I should like to support this joint request.
In addition to the reasons just given by Mrs Oomen-Ruijten, I should give this one: the budgetary texts are usually discussed during Strasbourg part-sessions. We are being asked to discuss the budgetary guideline or provisional reports here in Brussels.
I think that we should also mention the fact that the Intergovernmental Conference is due to take a decision on the headquarters issue and we should not anticipate that decision but continue to discuss budgetary questions in Strasbourg.
That is why my group supports this motion.

Wynn
Mr President, as you would quite rightly assume, I am going to speak against the suggestion from Mrs Oomen-Ruijten. The reasons she gave are quite spurious. This has been on the agenda now for some time. It went through the Committee on Budgets with quite a substantial majority. There were no problems then. We discovered there was a problem at 12.30 p.m. today. This is not the way for the House to run its business.
(Applause from the PSE Group) As for the problems, the sensitive issues which Mrs Oomen-Ruijten talks about will still be there in June. I would suggest that we leave it on our agenda. If there are any points in that report which she disagrees with, her group can vote against them there and then and that will resolve the issue.
(Applause from the PSE Group)
President
I put this motion to the vote.
(Parliament approved the request)

Urgent political matters
President
The next item is the communication by the Commission on urgent political matters of major importance.
There are two subjects: the situation in the Democratic Republic of Congo and Turkey-Iraq relations.
Situation in the Democratic Republic of Congo
Pinheiro
With the change of power in Kinshasa, the moment has come to turn back to the broader picture of the Great Lakes region and Central Africa, since none of the many crises in the region has been durably settled. There is a continued inter-dependence of political instability, caused by population movements, cross-border alliances and an ethnic pattern which transcends national borders. A daunting potential for further violent conflict and humanitarian disasters still prevails in the new Democratic Republic Congo and its nine neighbours.
The fact that the alliance has been sucked into a political vacuum enabled the rebellion to undertake a breathtaking military campaign, but it left the alliance with a number of poorly trained and ill-disciplined new recruits and a few very loosely controlled contingents with specific ethnic characteristics, be it Banyamulenge or an independent historic origin, as the descendants of the so-called gendarmes Katangais .
The sharp contrasts of Kabila's humanitarian commitments on the one side, and the continuing persecution of Rwandan refugees and harassment of international aid workers on the other, show a clear lack of cohesion or a lack of communication within the alliance, notably between the top political leadership and local military commanders. In the present crucial phase of political reorganization in the Democratic Republic Congo, this lack of control over the armed forces can cause serious difficulties.
Furthermore, the spill-over of the Zaire conflict into neighbouring countries could have long-term consequences, notably in Congo-Brazzaville and the Central African Republic, where the arrival of former Rwandan soldiers risks upsetting a precarious political and military balance. In Congo-Brazzaville it could also jeopardize the forthcoming presidential elections if the 'armed refugees' from Rwanda and former Zaire spark off a violent campaign between the main candidates. In Angola the possible return of 'mercenaries' of MPLA or UNITA origin may jeopardize the peace process which has already been aborted once before by an escalation of violence in the aftermath of the 1992 elections.
As regards Sudan, the dismantling of the rear bases of the anti-MUSEVENI opposition movements in the eastern part of former Zaire has given the Ugandan army and its Southern Sudanese allies a strategic advantage which is likely to lead to intensified fighting and increasing pressure on the regime in Khartoum. Thus, this conflict which has been smouldering for several decades could enter into a decisive phase and produce unexpected geo-political changes.
In Rwanda infiltrations across the border or under the cover of refugee repatriation have led to widespread insecurity. In some regions close to the Congolese frontier there are daily confrontations between government troops and heavily armed guerilla groups. If the situation deteriorates further, it could approach low-key ethnic warfare as in the case of Burundi. A new and preoccupying element is the reported alliance between militias Babembe and the armed Burundi opposition, the CNDD, in South Kivu. It corresponds to the declared ideological aim of the perpetrators of the Rwandan genocide and their Burundian sympathizers, that is to say the launching of a regional military campaign of 'Bantu' people of the Great Lakes against the presumed 'hamitic' invaders. In view of the critical demographic pressure in the region, the combination of this genocidal ideology and the advanced militarization of society creates an explosive political mixture.
In the new Democratic Republic of Congo, Laurent Kabila announced the formation of a new government within a presidential framework. We had hoped for a broad-based government, including all the main political forces, presumably excluding so-called Mobutees. The fact that one of the main leaders of the opposition to Mobutu, Etienne Tshisekedi, has been left out, despite good arguments, has been perceived as somewhat self-defeating. The fact that Mr Kabila promised to produce a new constitution and hold elections within two years is quite understandable, bearing in mind that his organization is a loose organization and time is required to stabilize the country, organize it, give it a government and finally have free and fair elections. It is better to wait and have a good electoral process, rather than rush and have some kind of unfair and corrupt electoral process.
Let me conclude by saying that we are extremely concerned about the humanitarian situation in the region, mainly because the lack of communication between the head of the alliance and some of the military commanders in the field has led to massacres of unarmed refugees. That is absolutely unacceptable and the European Union has made that quite clear not only in its communique but in a recent meeting held between our envoys and the Laurent Kabila's foreign minister.

President
Thank you very much, Mr Pinheiro.
You have the floor, Mr Robles Piquer.

Robles Piquer
Mr President, I would like to ask the Commissioner if this explanation - which was very reasonable and balanced - has been adequately conveyed to the Council. I also think it is scandalous that the Council should be absent today and I think that that scandal should make us think more about the other scandal, that of the absence of Europe in the development of the drama in Central Africa.
I should like to know whether those same arguments and description have been transmitted, with enough conviction and force, as this is a truly dramatic situation, so that, as the competent body for these matters, the Council might take appropriate measures in due time. It seems to me that there has been a total European vacuum here and once again that vacuum has been occupied by the US initiative.

Pinheiro
I should like to refer to the declaration made on 22 May 1997 by the Presidency on behalf of the European Union in which many of these elements were contained. I should also like to emphasize the fact that a European troika yesterday met with the Minister for Foreign Affairs of the new Democratic Republic of Congo and that the message sent was exactly along the lines of the statement I have just made.
I should also like to add, for the information of the European Parliament, that this afternoon I had the opportunity to talk to President Julius Nyerere about the situation in the Great Lakes and that the Commission today held a two-hour meeting with President Nyerere to hear his wise counsel and hear the experience of someone who knows the region well.

Andrews
What steps has the Commissioner taken to freeze the assets of Mr Mobutu which are held in Member States? Will the Commission take legal action in these Member States to try to recover the assets looted from that country so that they can be used for the reconstruction of the new Democratic Republic of Congo? I would also ask that the Commission take note of the fact that the European people would welcome Mr Mobutu as much as they would the greatest criminal. He should not be given refuge in the European Union under any circumstances.

Pinheiro
I am afraid the Commission has not the power to do so. Personally, I fully agree with your sentiments.

Kinnock, Glenys
I would like to ask the Commissioner two questions. Is he not encouraged by the axis of African Governments which has been formed and is led by Uganda at this time, sharing similar political, economic and military approaches to the Great Lakes area and the problems he has described? Which way does the Commission think it should best work with this axis?
Secondly, is the Commissioner aware that President Mandela has urged the West not to demonize Mr Kabila in Kinshasa and impressed on us that it would be suicidal for us to suggest that political parties, for instance, should be formed in Zaire at this time? Does the Commissioner intend to take President Mandela's advice and agree that it is not wise for us in the West at this time to give too much advice to Mr Kabila as he tries to restore law and order in that country?

Pinheiro
One must realize that in the former Zaire there were more than 100 parties and that did not contribute to democracy. So, I tend to agree with President Mandela and President Nyerere when they say that the top priority is law and order and stabilization. But, having said that, we must be sure that we are not running from a dictator into an autocratic system.
Therefore, it is very important that a clear calendar of commitment to the constitutional process and free and fair elections should be established as soon as possible. We think that two years is the upper limit and we are prepared to work with the authorities there in order to make sure that all the conditions for free and fair elections are met in due time.

Fassa
Commissioner, the United States was instrumental in bringing Laurent Kabila to power in the Democratic Republic of Congo. Is the Commission planning to coordinate its own action with that of the USA, or alternatively to protest if such action were to hamper the real - and not merely nominal - process of democratization in the Congo, which we are all hoping for and which, I understand you to be saying, still hangs in the balance?

Pinheiro
The role which the United States played in all the phases of the situation until Kabila took power has not been fully appreciated. My personal opinion is that our partners on the other side of the Atlantic helped to let the genie out of the bottle and afterwards tried somehow to put it back. But they did not manage. It was not a campaign of conquer. As I said in my statement, Laurent Kabila was sucked into the power vacuum which existed in former Zaire.
Having said that, I have been keeping in contact with the United States about how it sees the situation and how we can best cooperate in order to have law, order and a democratic country. The European Union has already expressed its point of view and its willingness to help in the rehabilitation and reconstruction of the new Democratic Republic Congo. But let there be no misunderstandings. There are some preconditions which have to be met. I am not prepared to sign a blank cheque.

Aelvoet
Commissioner, a few days ago your colleague Mrs Bonino stated that the humanitarian organizations were still unable to get to a number of places in Kivu where there were problems. Have there been any developments on this?
Secondly, you quite rightly referred to the need to restore law and order, but it must also be borne in mind that if there are problems, such as have already occurred in Kivu, for example, where the Association for the Protection of Human Rights has already had to step in, there must always be the possibility of taking action if human rights are being violated. What measures is the Commission planning to take here?

Pinheiro
The only reason why I did not go into detail with regard to the humanitarian situation was because I had already gone three minutes over my time. But Emma Bonino was absolutely right in pinpointing the humanitarian problem as a dramatic one. We are not overstating it. The numbers of refugees and displaced persons, be it in Tanzania, in South Zaire or in neighbouring countries is above 600, 000 at least. We are talking about a number equivalent to the population of Brussels, so it is a dramatic situation. We were very disappointed when the local military rulers did not allow the United Nations Centre for Human Rights and other agencies to send a fact-finding mission on humanitarian needs because the conditions imposed were such that it could not be accepted.
From the contacts we had with our special envoy who met the Foreign Minister of the Democratic Republic of Congo yesterday, it would seem that the difficulties have been overcome and we hope that in the very near future a fact-finding mission on the humanitarian situation and of the needs to respond to quickly will be made inside the Democratic Republic Congo.

Plumb, the Lord
The financial support into the whole of the Great Lakes region over recent years has been very considerable. In view of change, and since much of the money was going into the refugee camps over that period of time, I would like to ask the Commissioner how he sees development in the future and where the financial aid is going to be directed?

Pinheiro
Some programmes have continued, for instance in humanitarian assistance or in health programmes. They have continued despite the difficulties throughout the former Zaire. Our intention now, as I explained to this House a few months ago, is that once some peace and stability is achieved, the Commission is prepared to implement a global plan of reconstruction and rehabilitation in the Great Lakes region. We hope to provide a coherent plan which responds to the needs of that region.
In the meantime we have made known to our special envoy and to the Council and now to this House that we are ready to mobilize ECU 90m in order to help the immediate needs of the Democratic Republic of Congo, providing those conditions which I mentioned earlier are met. I sincerely hope that before the summer this will be clarified. The needs are urgent and we cannot wait for the normal procedures in order to commit and disburse this money.

Katiforis
Mr President, I should like to ask the Commissioner whether he will try to find out from the IMF or the World Bank about the scandalous loans granted to Mobutu, in full knowledge of the fact that they would not be properly used, because they had relevant files about the matter going back to 1988. Nonetheless, not only did these international bodies continue to lend him money but they even increased their loans.
I think that we have the legal powers to carry out an inquiry because money belonging to European taxpayers also went into Mobutu's pockets.

Pinheiro
I would like to emphasize that the Commission is not represented in the World Bank or the IMF but Member States are. So I hope that our Member States will act according to your suggestion because past history should teach us some lessons for the future - I refer to lending. And I do not mean only to dictators but also to heavily indebted countries which have no chance of paying back the debt in a normal way.

Vecchi
I gather, Commissioner - and could I please ask you to confirm - that your approach is based on one consideration and two conditions. The consideration is the following: clearly, in a situation such as that in the former Zaire, now the Democratic Republic of Congo, where - as has been pointed out here - a major power is conspicuously present, Europe must avoid being sidelined and excluded from the relations which that country and its new government will establish in the future. And the two conditions being laid down - with which I agree, but which I should like you to confirm - are as follows: firstly, regardless of the timing of the elections, the process of democratization must get off to a very clear start, so that there is no need to ban political activity and parties in order to maintain law and order; and, secondly, the problem of access to areas where refugees are located must be resolved immediately, and light must obviously be shed on the massacres.
That would appear to be the position, Commissioner.

Pinheiro
Apart from the fact that you did not mention the idea of having a broad-based government, you put it much better than me.

Maij-Weggen
Mr President, reference has already been made to the way in which President Mobutu's regime embezzled funds from development cooperation budgets and other sources. Will the Commission investigate how much European development aid funding has disappeared in Zaire? Is it prepared to bring proceedings against President Mobutu if necessary in order to recover those funds from the huge assets apparently held in Switzerland, so that they can once again be made available to the people of Zaire?

Pinheiro
Let me repeat - because it is important that this House knows - that the identified corruption cases, connected with Commission cooperation, are virtually nil. The reason is simple. The money is kept in such a way that it pays for services or work done or projects but is not fed into the beneficiaries' accounts. Where it happens - for instance with STABEX - there is such close control that it is virtually impossible for significant cases of corruption to take place. Nevertheless, we have asked our services to look at the situation closely to make sure that the money allocated to us was properly used and did not help to swell Mr Mobutu's bank accounts.
Turkey-Iraq relations
van den Broek
Mr President, the next subject is the situation in northern Iraq. On 16 May this year, the European Union issued a statement about the activities of the Turkish army in northern Iraq which made it clear that, although we can understand Turkey's desire to take action against groups planning or carrying out terrorist activities, in the final analysis the only possible solution to the Kurdish problem is a political one. It urgently called on Turkey to demonstrate the utmost restraint, to respect human rights and to withdraw its troops from northern Iraq as soon as possible. The Turkish authorities indicated that it was not their intention to establish a permanent military presence in northern Iraq, and that everything had been done to spare the civilian population. Of course it remains to be seen whether they actually keep to their word.
The current situation in northern Iraq is seriously hampering the humanitarian assistance that the Commission is providing for the area through the ECHO programme. A total of some ECU 10 million has been allocated in 1997 for projects mostly run by non-governmental organizations, often under difficult circumstances. This is why it is clearly essential for the Turkish army to withdraw as quickly as possible.

McMillan-Scott
It is quite clear that the situation is deteriorating in Turkey and we must all deeply regret the action the military have taken. Indeed, in September 1996 the European Court of Human Rights found the military guilty of a series of transgressions and only three days later Parliament tabled and adopted its famous resolution which declared that democracy and human rights activities need to be supported in Turkey. Alongside Piet Dankert we have been working to try to make sure that takes place.
Given the deteriorating situation in Ankara and the possibility that the military are moving into a position towards a possible coup d'etat , what would be the position of the European Union in that event?

van den Broek
I do not know whether it is very sensible to talk here about a coup d'etat in Turkey, or to speculate on what our position would be towards it. Let us be quite clear about this. A country such as Turkey, which has tried its best in recent months to demonstrate that it qualifies, albeit in the long term, for membership of the European Union, is hardly likely to solve its internal political problems through a coup d'etat , and nor, I have to say, do I expect it to do so. However, this does not mean that its internal political tensions are not clearly visible from outside. But just as I called for a political solution to the Kurdish problem, so I would hope there is all the more reason to call for a political rather than a military solution to Turkey's internal political tensions.

Roth
Mr President, Commissioner, you know that many Members of the House made their approval of the customs union with Turkey contingent on compliance with the call for an immediate Turkish withdrawal from northern Iraq. The previous operation in 1995 involved 30 000 troops and around 50 tanks. As you are well aware, the present operation is on a much bigger scale, with the deployment of 50 000 troops, 250 tanks, F14 and F16 bombers and Cobra helicopters. There is no reason to expect a withdrawal in the foreseeable future. I should like to ask, Commissioner, whether you consider such an intervention to be compatible with international law. What practical steps does the Commission intend to take to compel the Turkish armed forces to withdraw? And could you please explain what you mean by saying that Turkey has been asked to exercise restraint? What do you mean by restraint? And how, in your opinion, can the human rights of the civilian population be effectively guaranteed?

van den Broek
As we know, this invasion of northern Iraq is not Turkey's first military action against the north of that country, where there is currently a power vacuum in the absence of any sort of normal government, where different Kurdish groups are fighting for supremacy amongst themselves and one Kurdish group, so Turkey claims, has called on Turkey to come and help it to defend itself against the PKK. We witnessed a similar situation a few years ago. Then as now, the European Union made it clear that we categorically rejected any form of terrorist action by the PKK or other groups, and that we also recognized Turkey's right to protect its own people against terrorism. However, in taking any such action it must abide by the rules and principles of the constitutional state and the fundamental principles of human rights and, especially where military action is involved, it must refrain from using excessive violence to achieve its objectives.
Finally, we insisted that work must start on finding a political solution to the problem that lies at the heart of this situation, the unresolved Kurdish problem, since we do not believe in military solutions. I would point out to the honourable Member that there is little that we can actually force Turkey to do, but what we can do is to make it clear that the European Union and the international community are closely monitoring how this conflict is being handled, particularly as it concerns a country with which we have been holding talks on this very issue for such a long time, and which is hoping for closer relations and even further integration with the European Union. I hope that Turkey's ambitions in this respect will make it heed our concern about its military intervention and bring it to an end as soon as possible.

Green
A few weeks ago I led a delegation from my group to Ankara where we met with General Cevic Bir the deputy chief of staff of the Turkish armed forces. At that meeting General Cevic Bir said to us that as far as he was concerned the military had done everything they could in the Kurdish lands. What was needed now was a political initiative to deal with some of the problems the Kurdish people living in those areas had. Now just a few weeks later we see 50, 000 Turkish troops invading Northern Iraq to deal with what they claim to be the PKK terrorism in those lands.
This reminds me of the promises we received from somebody called Tansu Ciller, then Prime Minister, now Foreign Minister of Turkey, that she was the bulwark against an Islamic Government in Turkey. She is now in government with an Islamic Prime Minister in Turkey. Would the Commissioner agree with me that this House and that the Commission and the Council have been manipulated by the Turkish military and civilian authorities and that it is incumbent on us to expose the duplicity of the Turkish Government and military for the Turkish people?

van den Broek
I think that there is little more that the European Union needs to spell out to the Turkish Government. Our position could not be more clear: we categorically reject any acts of terrorism by the PKK, but at the same time we will not accept the excessive use of force or systematic human rights violations in combating terrorism.
Mrs Green mentioned the figure of 50 000 troops, but quite honestly I do not think the number is so important. Other independent sources talk about 30 000, while the Turkish authorities have not given any figures. The fact remains that this was a military incursion into neighbouring territory which is not under the control of the central authorities in Iraq.
All I can promise is that in our regular contacts and dialogue with Turkey, we will continue to urge it to accept Parliament's position, which is that the continuing threat of PKK terrorism should be proof of the need to start talks on a political solution. This would also, ultimately, resolve the issue of Turkey's military intervention, which we utterly condemn.

Alavanos
Mr President, I should like to ask the Commissioner whether he thinks that Turkey's activity in Iraq is an isolated, if repeated, incident or whether it is part of a general aggressive strategy by Turkey outside its borders.
Is it just pure chance that every five or six months Turkey invades or attacks Iraq? Is it pure chance that part of the Cypriot Republic has been occupied by Turkish troops for more than 20 years? Is it pure chance that Greece, Turkey's neighbour, has had its territorial integrity threatened by that country?
Given the more general aggressiveness shown by Turkey, what are the European Union's reactions, intentions or precautions? With particular reference to the Kurdish problem, the Commissioner has already referred to the terrorism carried out by the PKK but I should like to ask him whether the European Union is ready, as it did in Chechenya and Yugoslavia, to make proposals for a political solution to solve the Kurdish problem on both sides?

van den Broek
Turkey has never, either now or in the past, expressed any territorial ambitions with regard to Iraq.
There is also no reason to assume that it has such ambitions, since these would be totally indefensible under international law. I prefer to assume that Turkey is simply doing what it feels it must, and using means which it feels are justified to defend itself against an undeniable PKK terrorist threat, or at least to tackle it at the root. The fact that it is doing this on neighbouring territory is actually only possible because of the unusual situation in Iraq, where the lack of government and central control from Baghdad since the early 1980s when the Iran-Iraq conflict began has made the northern part of the country the only place where this could happen.
All we can really do for the Kurds and the Kurdish problem is to bring pressure to bear on the Turkish Government to start talks with the representatives of the various groups to see whether a political solution can be found.
You know that constant efforts are being made outside Turkey to bring the groups together to consider and discuss this question. If I am not mistaken, another of these seminars involving various representatives is to be held in the Netherlands shortly.

Lindqvist
I consider the Commissioner's response to be far too weak. We have entered into a custom's union with Turkey. As part of that agreement Turkey has committed itself to fulfilling certain democratic requirements which we have stipulated. Since concluding the custom's union, the situation in Turkey has progressively worsened. We have discussed the issue time and time again and have received unsatisfactory answers from the Commissioner. I think it is time that we adopted a hard line towards a partner which attacks its own people in its own country and all we do is sit back and listen month after month.
My question is: is the Commission prepared to issue a final date by which time the Turks must end their aggressive war against the Kurds? If not, is the Commission prepared in such circumstances to break off the custom's union with Turkey?

van den Broek
If the honourable Member is asking us to give an ultimatum threatening to abolish the customs union, we have to ask whether this would represent any kind of real pressure, given that the European Union currently enjoys an enormous trade surplus with Turkey precisely because of the customs union. But quite apart from that argument, I thought the House was aware of how carefully the Commission has been evaluating and monitoring relations with Turkey over the last few years, and how it has made a number of recommendations for a multi-faceted and carefully constructed policy. Parliament has also expressed the wish in our discussions that all forms of financial aid or instruments should be provisionally frozen if they are not being used directly or indirectly to improve the human rights situation in Turkey. I therefore think it would be fairly senseless and also less effective to start hitting out wildly and threatening Turkey with even stricter sanctions if it does not end its action against the PKK terrorists within a certain period. However, this does not affect the political statements which the Union made earlier, or our promise to Parliament that we will continue our efforts to bring about an improvement in the situation.

Dankert
The Commissioner has just repeated what the Council of Ministers said: that there has to be a political solution to the Kurdish problem. However, this was flatly rejected by Mrs Ciller at the Association Council before the invasion of Iraq. There is currently the threat of a government crisis in Turkey, and at the same time the Commission is telling us that there are various initiatives in progress that we would certainly support, which I quite agree with. We are monitoring the situation very carefully. But when I put the Kurdish problems together with the impending problems in Turkey's internal situation, I cannot help wondering, Commissioner, whether we need some rather more drastic measures, either from the EU or from NATO, than those which are currently being taken?

Lambrias
Mr President, with all due respect to the Commissioner, Mr van den Broek, I must confess that I cannot understand how such a serious violation of international law, a violation of borders, an invasion of another country, can be excused because the Iraqi government is unable to control that part of the country.
In the past my country has suffered from an influx of revolutionary elements from a foreign country, so to speak, but at no point was there any possibility that we could have upset the international order by ignoring frontiers. But if this violation by Turkey, together with its threats towards other countries, is accepted just because the Kurds have been carrying out terrorist attacks, that is giving Turkey carte blanche and I think it is an insult to the European Parliament to suggest that violations of this kind can be acceptable.

van den Broek
I hope that Parliament still agrees that no matter how justified the political claims are, we cannot in any way support the PKK's separatism, although we could support some kind of recognition of cultural identity. However, even where such claims are justified, we will continue to reject categorically and absolutely the use of terrorism in the pursuit of them, and it must be generally recognized now that the PKK is guilty of this.
People in Parliament ask me what else we can do to bring pressure to bear on Turkey. Both Mr Dankert and Mr Lambrias know that tremendous diplomatic and political pressure is being applied in talks with Turkey at present to try to find a breakthrough in the troubled relations between Greece and Turkey and to resolve the disputes in the Aegean Sea. A huge political and diplomatic offensive is being carried out to try to persuade the two communities on Cyprus, or at least the Cyprus Government and the Turkish Cypriots, to come to the negotiating table by the middle of this year to start talks on a political solution for Cyprus.
Thirdly, in our discussions with Turkey, we are constantly trying to ensure that the new legislation on the promotion and protection of human rights which Turkey promised would be introduced is actually enacted and adopted by the Turkish parliament.
I hope, therefore, that the honourable Members will believe me when I say that we are already stepping up pressure on Turkey to bring about improvements in all these areas. I would simply point out that when it comes to the Kurdish problem, which I freely admit to Mr Dankert is not really viewed as a problem by the Turks, who see the terrorism as the problem, but not the Kurdish issue which lies behind it, we are not at present in a position to force through a solution.
None of this changes what I said in my earlier replies about signalling to Turkey that this military action needs to be ended as quickly as possible.

President
Thank you very much, Commissioner.
The debate is closed.

Excessive deficits and economic policies
President
The next item is the joint debate on the following reports:
A4-0181/97 by Mr Christodoulou, on behalf of the Committee on Economic and Monetary Affairs and Industrial Policy on: I. the recommendation for second reading on the common position adopted by the Council with a view to adopting a Council Regulation on the strengthening of the surveillance of budgetary positions and the surveillance and coordination of economic policies (C4-0174/97-96/0247(SYN)) and II. the report on the proposal for a Council regulation on speeding up and clarifying the implementation of the excessive deficit procedure (6931/2/97 - C4-0577/96-96/0248(CNS)) and - A4-0184/97 by Mrs Randzio-Plath, on behalf of the Committee on Economic and Monetary Affairs and Industrial Policy, on the economic policy of the Member States of the Community (COM(97)0168 - C4-0190/97)
Christodoulou
Mr President, on 28 November 1996, the European Parliament adopted, at second reading, resolutions on the Stability Pact concerning two proposals for regulations. The first was on the strengthening of surveillance of budgetary positions and the surveillance and coordination of economic policies on the basis of the cooperation procedure, and the second was on speeding up and clarifying implementation of the excessive deficit procedure on the basis of the negotiation procedures.
As you know, at the Dublin European Council, on 13-14 December 1994, a political agreement was reached on the general principles and main elements of the Stability Pact. The European Council also called for the preparation of a draft resolution on the Stability Pact to be adopted, recording the commitments of the Member States, the Commission and the Council to a strict application of the Treaty and the legal provisions of the Stability Pact.
At the informal meeting of the ECOFIN Council, in Noordwijk, the texts of the two proposals for regulations and the draft resolution were agreed and the common position on the first of those proposals was forwarded to the European Parliament and was adopted in first reading, while it requested to be consulted again on the latter proposal.
In the preparation of the amendments, as part of the relevant examination, the following elements were taken into account:
First of all, the political will expressed at the Dublin Summit.
Secondly, the European Council's decision to opt for a strict application of the Stability Pact and, at the same time, the fact that the Council changed its name to the Stability and Growth Pact. Unfortunately, this qualitative improvement, as expressed by the new title, is not reflected in the texts which have been sent to us from the ECOFIN Council. The title has changed but the content has remained more or less the same.
The inclusion in the regulation of surveillance for the Member States not participating in stage three of EMU is an important new element. Whereas the original proposal by the Commission foresaw only the submission of convergence programmes by those Member States participating in stage three of EMU, there is now a separate section on the submission of convergence programmes by Member States not participating in it. We have tabled an amendment on this which I shall analyze for you later.
We think that the Stability Pact has to be effective. That effectiveness will depend upon its ability to be implemented and the confidence in it. Any changes made will have to be made in that direction. The relative inflexibility of the provisions and the generally automatic and mechanistic character of those provisions fails to take into account the dynamic nature of economics and of monetary phenomena which restricts the implementation of these provisions and as a consequence will undermine the confidence in those provisions and the Pact itself.
Finally, the proposal for a regulation for the implementation of the excessive deficit procedure foresees the imposition of the penalty of a deposit which could be turned into a fine. Here we have a very serious problem in that the original Commission proposal foresaw that the product of the fine and interest generated would constitute revenue for the Community budget but the new proposal, although not yet finalised, is that it should be distributed among the Member States which do not have an excessive budget and this seems to be the overriding opinion in the Council. The result of this imposition is a paradoxical phenomenon and I shall not criticize it now, but I should just point out that, until now, no legal basis or clear procedure for implementing this idea put forward by the Council have been found. However, although this has not yet been finalized by the Council, we must vote for the corresponding amendment that we have tabled, which has come out of the Committee on Budgets, because that would express the European Parliament's will to maintain the principle of budgetary unity, an elementary basic notion, and something which must be maintained come what may. Given the difficulties which the Council is facing in finding a legal basis, it is very likely - and here I am hazarding a guess, of course - that these amounts will be inscribed in the budget and that they will be shared out subsequently according to political commitments and perhaps a subsequent amendment to the relevant budgetary provision. However, that is no reason for us not to vote for this amendment, even though it refers to a text which has yet to take its definitive form.
Therefore, our amendments are aimed at improving the Pact in its main points. In particular:
First of all, they lend the draft resolution of the European Council its rightful dimensions, on the basis of Article D of the common provisions of the Treaty. This draft resolution will then be seen to be setting political guidelines for the subsequent and opportune implementation of the Stability Pact, but that it is not part of the articles and has no legal content. It is simply a political guideline.
Secondly, these amendments define the public investment expenditure which are a decisive factor for economic growth and development. We would, therefore, be giving substantial content to the meaning of 'development' added to the Pact by the Dublin Council. I am pleased to tell you, Mr President, that this has been accepted by the Council and the Commission and will be included in the articles of the regulations.
Thirdly, the provisions for the convergence programmes are made more realistic and bring into the regulation on surveillance a sense of strengthening those Member States not participating in stage three of EMU, by protecting them from profit making in the framework of the new exchange rate mechanism, i.e. protection by the European Union's bodies from profit-making attacks. Special circumstances are also planned for, such as not regarding as a budget deficit any expenditure connected with protecting the territorial integrity of Member States.
Fourthly, without easing up on the strictness of application by any means - and I must emphasize this, Mr President - the amendments allow a certain flexibility, which is necessary if the Stability Pact is to function properly and if it is to be both applicable and reliable. In many cases, absolute inflexibility means a lack of feasibility and confidence suffers as a result.
Finally, they reinforce a basic principle of budgets, as I referred to earlier, by retaining within the Community budget the fines imposed and interest generated on them. These are the basic principles underlying the amendments we have tabled and which we have brought before the European Parliament for its vote. They are included in one text and all of them have been approved by the Committee on Budgets.
Taking into account developments so far, the need for a stable euro and the need for sustainable provisions, we have made an attempt to avoid an excessive number of amendments so that those elements which we believe to be absolutely necessary can be stressed. Therefore, we are not bringing before the plenary for voting those amendments which were not approved by the Economics Committee, apart from amendments on a technical matter, which I have just mentioned and on which I shall give my opinion later on.
To conclude, I propose, as rapporteur, an amendment to the common position on the regulation on surveillance and an opinion on the regulation on deficits, in accordance with the amendments adopted by our Committee, thereby concluding the second reading.
To finish, I would like to emphasize the importance of this matter from both the political and economic points of view and to stress that, if we were to reject these proposals, we would be sending the wrong signal to the outside and the European Parliament would then be excluded from the taking of important decisions. Therefore, I hope that the opinions expressed in this text will be given your resounding support. However, we think that it is vital for the Commission and the Council, which unfortunately are not present at this moment in time, to pledge that at the next Councils, due to take place shortly, they will adopt the proposals which have been accepted, in other words relating to the draft regulation, on the issues of development and public investment, and the other elements which have been accepted during the three-day negotiations and subsequent communications which we had with the Council and the Commission. In all good faith, we are proposing that both of these regulations be voted for. I would like to hope, or rather I am sure, that the Commission and the Council will promise to honour their obligations due to us.

Randzio-Plath
Madam President, the economic trends in the European Union, and above all the employment policy trends, must be viewed with grave concern, and for that reason the broad guidelines for the economic policies of the Member States and the Community are particularly important. As I see it, we have failed in previous years to make sufficient use of these guidelines to actually achieve a greater degree of concertation and coherence in European economic policy, affecting measures in both the public and private sectors. This year, therefore - one year before we have to decide who is to participate in monetary union - we must give particular attention to how these guidelines are drawn up. I very much regret that the Commission's thinking hinges on the idea that, simply by pursuing and respecting the objectives of monetary stability and budgetary consolidation, we shall more or less automatically achieve the increased investment and growth that we require, and that this will also halve unemployment by the year 2000.
In my view, this is not enough; in fact, it is far from enough to ensure the implementation of all the political initiatives that have been expressed in Parliament's resolutions - initiatives on which we are united. Broad guidelines for economic policy must therefore be based on more than a mere restatement of the convergence criteria. I do welcome the fact that the Commission is seeking to direct public expenditure towards productive investment; this is something which Parliament has also called for, and in this respect the Commission is going a step further than in last year's annual economic report. I believe that we must concentrate on promoting investment to a much greater degree than has previously been the case in the guidelines. We need a system of benchmarking for investments, because when we consider that in Germany alone, investments fell last year from 18 billion to 1.1 bn, we realize just how vulnerable our situation is, and it is only by pulling together that we shall be able to escape from the hole that we are in.
I should like to emphasize one point in particular: precisely because it is important for us to act together at Community level, the guidelines will have to be much more binding, so that they can actually be applied and implemented in practice. It is therefore important that we should take an approach which makes employment policy a defining element in all other policies. This means that the broad guidelines for economic and employment policy must be woven together, as it were, so that we can do more to promote economic policy with a view to creating new jobs.
I feel that this is genuinely important, because people are the raw material of the European Union, and any kind of investment in people - whether in terms of providing them with qualifications, further training or lifelong learning, or through accompanying measures such as research and development and support for innovation - will help us to make real progress within the European Union. We have to keep on reminding ourselves that the decisions which were taken at summits from Essen to Dublin are still awaiting implementation. That is why we must create a new set of circumstances, although it is quite clear that, far from turning our backs on the pursuit of monetary stability and budgetary consolidation, these must continue to be our objectives.
The House should be able to agree on a number of demands: we need to channel public funds more directly into productive investment; private companies must be more strongly reminded of their duty in terms of promoting the economy and jobs; and we need better coordination of economic policies and stronger links between the policies of the Member States and the Community. At the same time, we should not forget that national economies have become increasingly interdependent - to a degree that was previously unimaginable - and of course this means that any measure taken in one Member State is bound to affect the measures in others.
I think it is also important for the political players to speak out more clearly, since it is only by conveying a clear sense of political direction and letting it be known unequivocally that the monetary union will begin on 1 January 1999 that we shall regain the confidence of economic operators. What we need is not only increased investment and the confidence of the business community, but also the confidence of the population at large. Rates of saving in the European Union are at record levels, without historical parallel, but the people who have money are not consuming, while those who have no money are unable to consume. This is an indication of how essential it is to raise the level of demand and increase purchasing power.
I would reiterate just how important it is that we should ultimately reduce the tax burden on the labour factor, because that is the way to increase purchasing power in real terms. I attach particular importance to this, specifically in terms of the measures which need to be taken to create the right overall framework. I would also urge once again that we in the European Union should work towards integrating our policies and directing them towards achieving a high level of employment. We must make a real effort, through our policies, to bring about the kind of synergy effects which can no longer be achieved by an individual country for the benefit of its own economy and people.
I therefore believe that it is extremely important to direct the measures which affect economic policy towards a single goal, and to integrate our structural and financial policies. For their part, the Member States must finally fulfil their commitments by actually making the resources available to complement the structural funds that are earmarked for promoting employment policy objectives. Otherwise, there is little point in having a European policy. Commitments must be honoured both at Community level and by the Member States of the European Union.

Hernández Mollar
Madam President, with too little time but with great interest we have analyzed, in the Committee on Social Affairs and Employment, the regulations which are the subject of today's debate. We have done so in the light of our great concern, which could be none other than the effects on employment, on our social model, of the measures to be adopted in the framework of both of these regulations to supervise the economic policies of Member States and introduce surveillance over public deficits in the run-up to this exciting event for the European Union which is now nearly upon us.
On the other hand, these regulations reflect the need for the economic policies of the Member States of the European Union to advance in tandem in order to strengthen monetary union, since there can be no talk of a single currency with divergent economies as that could not guarantee stable prices or growth. Therefore, it is obvious that only if we have a stable and controlled budgetary situation and if our economies are converging can we coordinate efficient, job-creating employment policies.
Therefore, I also think that - apart from the need for the Council to take into account the unemployment rate and the rate of job-creation when examining the stability and convergence programmes - in order to adjust its objectives, it must also analyze not only the size of deficits but also the type and, therefore, to pay particular attention to public expenditure, in particular, on education, training, investment and infrastructures, which have beneficial effects on Europe's regions, especially in times of crisis.
This by no means contradicts the fact that a healthy budgetary situation is fundamental if we are to respond rapidly to adverse economic situations and, at the same time, to control the public deficit. After all these are basic elements for economic growth and subsequent job growth. It is for this reason that we have tabled amendments in the Committee on Social Affairs and Employment to these regulations.
We must also contemplate the overall situation of a country before imposing sanctions on it as heavy as those foreseen in the regulation on excessive deficits and, at the same time, it seems to me a good procedure to help to add to the credibility and confidence in the future European monetary union.
On the other hand, in relation to the economic guidelines for 1997, nobody doubts that the European Union is, at this moment in time, facing a challenge which can only be compared with its very birth. Europeans, especially those governing their destinies, have committed themselves to the adventure of uniting their economic, human and social potential in order to confront an undeniable need: working and subsisting in an increasingly globalized market, an increasingly technical market, an increasingly interdependent market. Monetary Union is just one more step towards joining forces. Unemployment, the European Union's most serious problem, cannot only be measured in figures, because above all it is the young, women, elderly, disabled, citizens who will blame us if we do not achieve our main objective in this adventure of ours, that of creating jobs.
In front of the European Parliament, today, the workers of Europe have been calling for a special clause, in the future Treaty, referring to employment. To turn a deaf ear to them would be doing the European Union a disservice. We must show our sympathy and solidarity with them. On the other hand, workers harming other workers, as has recently occurred in the case of attacks on Spanish lorry drivers, imbalances and injustices in the social security systems or an excessively rigid labour market in Europe are factors that seriously hinder progress towards our European project. Therefore, the Committee on Social Affairs and Employment, while recognizing the Commission's efforts in the form of these major economic guidelines which we are debating, once again wishes to voice its concern at the high level of unemployment in the European Union. In order to combat unemployment we must have growth, we must compete and we must invest, but we must also increase domestic demand and that will only happen if we generate confidence, and people have confidence when investment is productive, when employment and social security systems are effective and when workers, women or men, receive a fair and adequate wage.
Fortunately economic policy and employment policy do seem to be going hand in hand and the Commission document has set aside a special paragraph for using structural reforms to favour job growth. That is not enough. We must make better use of the European Union's instruments, such as the Committee on Employment and the labour market or the multiannual programmes in order to improve coordination of economic and employment policies, so that we can also make it easier for both sides of industry to discuss matters at European level.

Willockx
Madam President, ladies and gentlemen, the Committee on Budgets focused its attention on the methods to be used for recording and applying the sanctions laid down for Member States violating the 3 % rule in future. We agreed with Mr Christodoulou that the procedure itself should not be called into question. We feel that the stability pact forms part of the overall concept of a single currency and we therefore wish to approach it constructively, which is why we held informal three-way talks at which we were able to put our views to the Council. However, I have to say that we are still faced with a procedural problem that is difficult to accept in democratic terms: establishing whether the Council thinks there is a legal basis for the method it wishes to use for channelling the revenue to the participating members which are not in breach of the rules, in other words excluding the opting-out countries and the countries paying the deposits or fines.
We in the Committee on Budgets consider that this would be impossible to implement and would set an unacceptable precedent. We would refer here to other existing sanctions such as in the agricultural sector or the Structural Funds, where the revenue from the sanctions is pooled in the Community budget. This is not to be the case here, and we fear that this precedent will throw the budget into turmoil, especially if there is to be flexibility in various sectors in the future. For this reason, we would urge the House to consider our amendment to Article 16, and we would also urge that a definitive answer should be obtained from the Council as soon as possible - preferably before tomorrow's vote - on the legal basis it intends to use, which is by no means clear at the moment.

de Silguy
Madam President, ladies and gentlemen, today's debate offers yet another possibility for examining the Stability and Growth Pact and the main thrust of economic policy. This is a timely moment, because the Commission wishes to implement them and also show the coherence attached to the conditions of achieving and operating Economic and Monetary Union. The Pact and the coordination of economic policies will ensure sustainable stability, growth and employment in Europe.
First of all, I should like to specify a number of points on the Stability and Growth Pact. First of all, I wish to thank personally, on behalf of the Commission, Mr Christodoulou, for the quality of his work, his sense of responsibility and his extremely useful contribution to the definition of this Pact.
Following the informal 'trilogue' held on 6 May 1997, the Commission expressed two major preoccupations which it shares with your rapporteur, and it has not failed to be the ardent defender, in this respect, of the European Parliament's view in the Council. Those preoccupations are, first of all, the definition of an improved interinstitutional balance within the Pact and, secondly, strengthening the role of public investment.
Therefore, the Commission is in a position to accept most of the amendments tabled by your rapporteur, namely Amendments Nos 1, 2, 3, on the resolution of the European Council, Amendment No 4, first part, Amendments Nos 5 and 8 on public investment and expenditure, and Amendments Nos 6, part 2, and 9, part 2, on the regulation based on Article 103.5. Similarly, the Commission is willing to accept Amendments 1, 2, and 4, part 2, to Regulation 104.C.
A word on the fines, in other words Amendment 5 to the regulations. I recall that, although there has been no Council decision, the European Parliament can of course vote on an amendment on this text concerning fines. I recall that the European Parliament is delivering its opinion on the modified proposal of the Commission. On this score, the Commission maintains its initial proposal for complete budgetization. It cannot accept the European Parliament's amendment, because it must maintain its room for negotiation and play its role as the debates in the Council evolve. That said, I can assure you that the Commission will do all that is necessary for all of the European Parliament's budgetary prerogatives to be honoured and for a transparent solution to be found.
I now come to the main guidelines of economic policy which are an essential instrument for improving the coordination of economic policy in Europe. This year they confirm that the macro-economic strategy is bearing its fruit because recovery is now showing. On the basis of this encouraging fact, the Commission recalls that only a strict respect of the convergence criteria can enable us to pursue the 'policy mix' and thereby contribute to a sustainable improvement in growth, and in turn lead to the creation of employment and productive investment in Europe.
In this framework, the main guidelines are intended, as your Assembly demanded in its resolution on the annual economic report, to give a further boost to the European Union's economic strategy. It is first and foremost a strategy in favour of employment. The Commission cannot accept the criticism that its recommendation would not sufficiently develop the conditions for growth and employment because it is perfectly aware of the seriousness of the scourge of unemployment in Europe.
On this score, I must make two comments. First of all, employment cannot be 'decreed away' . The creation of employment results from strong, sustainable and balanced growth. The positive results in terms of convergence make it possible to pursue the policy mix which serves both growth and employment. Secondly, like the European Parliament, the Commission is well aware of the essential role played by demand in the growth process. If demand grows at a faster rate than supply, or if demand is artificially stimulated, new imbalances will be created. Corrections will then be necessary and that would threaten the current policy mix, i.e. growth and employment.
I think that I should be able to reassure Mrs Randzio-Plath, whom I found a little too pessimistic, personally, because demand, consumer demand in particular, is improving in Europe: + 1.9 % in 1997, + 2.4 % in 1998, but investment demand is also growing: investment in equipment, for which we are taking the figure of + 4.8 % in 1997 and + 6.3 % in 1998. In order to stimulate the net creation of jobs, the Commission is therefore recommending this year an improved coordination of the economic policies of Member States, including those related to employment matters. I must recall that, at its initiative, surveillance over employment was set up back in 1995. On the basis of the programmes presented every year by the Member States, a joint report by the ECOFIN Council and the Social Affairs Council was adopted by the European Council at the December meeting.
As far as the Commission is concerned, the following major lines of action, in macro-economic matters, should be pursued. First of all, we must promote innovation, research and development and improve systems of education and vocational training. Secondly, we must improve the functioning of the goods and services markets. For this purpose, the Commission will be presenting the European Council in Amsterdam with an action plan on the internal market. Thirdly, reforms of the labour market must be pursued and, in the Commission's view, that must not lead to lower salaries but a reasonable overhaul of the salary structure, in line with differences in productivity. In other words, a strategy for employment but also a strategy which liberates investment is our recommendation.
Like you, in the European Parliament, the Commission has found the state of affairs rather disappointing but the last figures which I gave show that this pessimism should nonetheless be tempered. Indeed, current surveys already show growing confidence among producers, and investment profitability in the European Union is at its highest level since the 1960s.
The Commission also notes that employees have contributed to a healthier macro-economic framework through wage moderation. It, therefore, thinks it is vital that employers should now seize the opportunity provided by the excellent economic conditions, and their own financial situation in most cases, to relaunch job-creative investment.
Any relaunch of investment should concern private investment - 85 % of the total, may I recall - as a priority, and in all forms: physical, immaterial and human investment. But the Commission also recommends maintaining public investment and expenditure, especially on the trans-European networks. As you know, this expenditure is vital if the European Union is to be given a sustainable growth potential in the medium term. It is investment for the future of society as a whole.
By way of conclusion, I would first of all very quickly like to say that, concerning the Stability and Growth Pact, and with those of your amendments which the Commission accepts, i.e. most of them in terms of substance and many of them in terms of quantity, we have now, I think, reached a balanced compromise. This compromise should enable the European Parliament to assert its point of view on the adoption of this essential text. Now, we must conclude, because we have no more time if we are to meet the deadline.
Please allow me, also in conclusion, to respond to the suggestion made by your rapporteur, Mrs Randzio-Plath, on the main guidelines concerning an inter-institutional agreement for implementing Article 103 of the Treaty. For its part the Commission has always shown willingness to set up such an agreement, as long as the Council can take it on board. The Commission has not sat idly by in recent times but has worked to bring the European Parliament more into the multilateral surveillance process. I think that today's debate bears witness to that.
Therefore, to conclude, I wish to emphasize the need for both of our institutions to pool our efforts to implement this Pact and the recommendations in order to accompany as well as we can the introduction of the euro within the framework of the conditions and calendar scheduled by the Treaty.

Randzio-Plath
I did not entirely understand the Commissioner, and I should like to know if he would be prepared to include Parliament's proposals in his draft for the broad guidelines of the economic policies of the Member States and the Community.

Christodoulou
Madam President, I should like to thank the Commissioner for the proposal he has made and for the announcement that he is accepting these amendments.
I should like to ask him to take another little look at Amendment No 4 to the first regulation, Recital 10, given that, in its own position, as it was presented to the Council, the Commission accepted that amendment. The Commission refers to its own text, which happens to have fallen into my hands, Madam President, in which reference is made to the mechanism for protecting exchange rates, i.e. the ERM.
Whereas this mechanism will also assist them - the countries which are not members of economic and monetary union - to resist unwarranted pressures on their currencies in the foreign exchange markets.
We say exactly the same thing in the Explanatory Memorandum for this amendment and I must ask why the Commission cannot accept it.
Therefore, as for the rest, I repeat that I must thank the Commissioner but I would like him to take another look at this matter and see whether that amendment cannot also be accepted.

President
Mr Christodoulou and Mrs Randzio-Plath, the Commissioner will have the floor again at the end of the debate to answer your questions. For the moment, we shall proceed with the debate.

Donnelly, Alan
Madam President, I should like to thank the two rapporteurs for their reports to which I shall make some brief references later. First, however I should like to say to the Commissioner that the whole conduct of the procedure for the Pact for Stability and Growth has been a very sad series of incidents where attempts were made time and time again to exclude this Parliament from participation in this debate. It is only due to this House's resilience that we are now at a stage where the Commission is recommending that it accepts some of our amendments. I hope that in the future we will have a better relationship when we deal with these extremely important economic and monetary questions.
There is a paradox in the Commissioner's presentation today. On the one hand he talked about the broad economic guidelines, the fact that the Commission has as its goal increased research and development, increased growth and better systems of education. On the other hand, he presents to us a Pact for Stability which has the word 'growth' attached to it, although there is nothing in the Pact related to growth, only to stability, which potentially undermines any measures we can take to boost research and development, systems of education or growth. As the Commissioner knows, wrongly used the Stability Pact could be highly deflationary, reduce growth and add to unemployment. That is why I insist that the Commission exercises its responsibility under the Treaty of European Union so that this Stability Pact is not used by those forces in the Council of Economic and Finance Ministers that want to undermine the development of employment within the European Union.
If we want to have growth and stability in the European Union, we have to boost investment. At the moment investment represents 19 % of GDP. The Commissioner's own economists suggest that investment must rise to 25 % of GDP. How do we square the circle of the Pact for Stability and Growth and bearing down on borrowing and budget deficits with the need to increase investment in the European Union. Even Mr Ciampi in his report on competitiveness said that public investment has a key role in stimulating private investment in Europe's economy. Therefore, it is the responsibility of this Commission to make sure that we promote public investment, that we do not impede it, so that it leads to wider private investment and greater growth opportunities within the European economy.
I say to the Commissioner that we will be watching very carefully the role of the Commission and the role of organizations such as the Monetary Committee which has no transparency, no democratic legitimacy. Will the Commissioner stand up to the Monetary Committee? Will he exercise his responsibilities under the Treaty of European Union?
I shall conclude with a comment on employment. The Commissioner has stressed the need to boost employment in the European Union. We will now put in place the Pact for Stability and Growth. We are putting in place the final instruments for the management of monetary policy. We must activate the European Investment Fund and the borrowing requirement at a European level to compensate for the borrowing that Member States themselves are not able to introduce. That is why I would ask you, Commissioner, between now and next year's annual economic report and broad economic guidelines to fight to defend what the Commission and the Essen summit agreed, namely to support the Delors and Santer initiatives on borrowing at European level to help boost investment levels.

von Wogau
Madam President, ladies and gentlemen, the stability pact is undoubtedly one of the major steps on the road to European monetary union, and the question of whether it can be approved, on schedule, in Amsterdam is crucial.
As you have heard in the debate, certain differences of opinion exist - between Parliament and the Commission, but in particular between Parliament and the Council - concerning the stability pact. That is why we have engaged in negotiations with the Council, and we had a very constructive exchange of views with Mr Zalm, the Dutch Finance Minister and President-in-Office of the Council. Our discussions centred on three issues: firstly, the essentially institutional question of cross-referencing between the proposal for a Council decision and the two directives; secondly, the question of including in the stability pact the golden rule, with which you are familiar, which requires that the level of investment provided for in a budget must be higher than that of new borrowing; and the third point concerns the budget, and has been dealt with very fully and clearly by Mr Willockx. In our view, no special budget can be created for fines to be paid into; if fines are paid, they must go into the budget of the European Community. Those were the points at issue in the negotiations.
I think I can say that the negotiations indicated that the Council might be prepared to move some way towards us on two points: cross-referencing and the question of the golden rule. As regards the budget, I am not yet sure what the position is. However, it is my belief that we have the law on our side, since the Council's legal advisors are still searching, somewhat desperately, for a legal basis on which to resolve the issue, and I think they could end up by falling in with our proposals.
Finally, I should like to stress one point: it is absolutely essential that we should not at this stage think of postponing the report or delaying it, but should decide now to take a vote on it tomorrow and deliver our opinion. I have heard - and I find this quite incomprehensible - that there was talk in the Socialist Group of postponement or referral back to committee. I would regard any such move as highly dangerous, and I think that it should not be allowed under any circumstances. We must vote on the Christodoulou report tomorrow.

Giansily
Madam President, ladies and gentlemen, I think it is vital, on such an important subject, first of all to recall some very simple principles.
The greatest challenge that we have to face in most of our countries is that of unemployment. Yet the improvement of the labour market depends on more growth and that is something which cannot be decreed. It results from healthy parameters. Public deficits have never created jobs, otherwise we would have too many jobs now. You only need to look at the situation in the United States and in Holland.
Similarly, growth must, in the medium term, be encouraged by demand and sustained by judicious investment coming mostly from competitive companies, at the rate of 85 %. We see that, in Europe today, demand is recovering on a healthy basis, which ought to stimulate investment.
Finally, it is increased productivity which leads to growth and we should remain very attentive to developments in wages and deficits. All of these reasons are such that the texts that we are discussing today are of capital importance for the future of Economic and Monetary Union. By the same token, the informal Council meeting held in April, which was a success, only represented, if I may say so, the legal 'setting to music' of decisions already taken at the Dublin European Council in December.
We are also convinced that the adoption, as soon as possible, by the European Parliament of the text proposed to us concerning excessive deficits and strengthening the surveillance and coordination of budgetary policies is absolutely vital if we are to have the text finalized in time for the Amsterdam Summit.
With this in mind, all of the texts of interest to us, i.e. those concerning the EMS Mark II, the Stability Pact, and those concerning Articles 103(5) and 104.C, also naturally receive our approval, as does Mr Christodoulou's high quality report.
Madam President, ladies and gentlemen, I also note, with regard to the fight against excessive deficits, that the system proposed is meant essentially to be preventive and dissuasive. It does not seem to be an approach which puts emphasis on sanctions.
Finally, today we wish to congratulate the Commission which has succeeded in making sure that budgetary surveillance is exercised in the future not only on a country-by-country basis but also in the European Union as a whole. This is a major achievement if we are to have a budgetary overview of the European Union and will be particularly useful for us in the multilateral macro-economic dialogue to be conducted with the European Union's main partners.

Cox
Madam President, I am speaking on behalf of the Liberal Group on the Christodoulou reports. In effect, I could give a very short speech because I agree entirely with what was said by Mr von Wogau. On the question of cross-references between a Council political declaration and the regulations, the Liberal Group agrees that those references should be minimal. On the question of the so-called golden rule on investment, we can support references to Article 104(c) in the relevant paragraphs within the multilateral surveillance proposition.
On the Stability Pact, the Liberal Group welcomes the emphasis placed by Parliament on the need for interest on deposits and on fines which arise under this pact to be, in principle, assigned to own resources. Finally, I agree entirely with Mr von Wogau. Under no circumstances, having secured additional commitments from the Council and recognizing the critical importance of the Stability and Growth Pact to EMU, will my group be prepared to postpone the vote tomorrow.

President
The debate is adjourned.
It will be resumed after the debate on the European Council meeting of 23 May 1997.

European Council of 23 May 1997
President
The next item is the Council report and Commission statement on the results of the European Council meeting of 23 May 1997.

Patijn
Mr President, I am most grateful to you for allowing me to come here today. This is the first time that I have spoken in your new building, and I only hope that the future of the European Union looks as flourishing as your accommodation!
I should like to give you a brief report on the informal meeting of the European Council held in Noordwijk on 23 May. The only subject on the agenda was the Intergovernmental Conference, and in view of the informal nature of the meeting there were no official documents for discussion and no conclusions were reached. However, this does not mean that no preparations were made.
A week or so before the meeting in Noordwijk, the presidency issued a kind of summary working document which had no official status, but simply gave the presidency's view of how the negotiations had gone so far and clearly indicated to the contracting parties where we stood and how we were to proceed on the basis of the presidency's proposals. The text, and indeed the overall situation in the negotiations, were discussed in advance at an informal meeting of the group of personal representatives which was held in Houthem near Maastricht on 16 and 17 May. Representatives of the European Parliament also attended much of the meeting. On Tuesday, 20 May the Ministers of Foreign Affairs met to discuss the subject, and I was delighted that you too were able to attend and put forward your ideas. I should like to congratulate you on the very communicative and constructive approach which you and your representatives maintained with the presidency and the negotiating conference at every level, not least in informal contacts, and I shall be returning to this later in my speech.
In Noordwijk, there was the usual meeting with yourself as President of the European Parliament, followed by a short discussion. I wished to mention this specifically because it is one of the permanent features of the European Council. As we saw in Noordwijk, there are still a number of difficult issues to be resolved before we get to Amsterdam, which is where we still expect to conclude the Intergovernmental Conference.
However, generally speaking the Heads of Government felt that the Conference had made excellent progress, and the round-table discussions looked at a number of different subjects. Among these was the review, which covered the inclusion of more specific provisions on human rights in the Treaty, the introduction of the principle of non-discrimination, a chapter on employment, the reintroduction and consolidation of the social protocol and the removal of the United Kingdom's opt-out, a new legal basis for openness and transparency, the consolidation of the European Parliament's legislative role and the simplification of procedures, the extension of the powers of the Court of Justice - particularly under the third pillar, and the combating of fraud. These are all areas where the presidency has the impression, especially having heard what was said at Noordwijk, that the Conference is largely in agreement. This is not to say, of course, that there is not still a good deal of fine-tuning going on, but this is what you would expect when the time comes for the politicians to hand their work over to others, particularly lawyers.
I would point out that it also became clear at Noordwijk that agreement has yet to be reached on a number of issues, particularly the communitization of the free movement of persons, the integration of the Western European Union into the European Union, and flexibility. There is as yet no political agreement on any of these issues. Nevertheless, it appeared from the general assessment made by the Heads of Government at Noordwijk that there was a clear political will, already seen at the conference at The Hague on 20 May and now confirmed in Noordwijk on 23 May, to bring the IGC to a successful conclusion with an Amsterdam Treaty at the Amsterdam summit. It was also clearly stated, much to our appreciation, that thanks to the documents put forward by the presidency, there was also a very real prospect of actually producing this Treaty.
Apart from this general round-up, there were also a number of other issues, particularly institutional questions, on the agenda at Noordwijk. These are areas where the presidency has always hesitated to spell its ideas out in specific provisions or proposals, because we could only ever really guess at what the eventual consensus might be. The first of these issues was the effectiveness and composition of the European Commission, on which it was clear from the discussions in Amsterdam that there had been a definite political shift, which the presidency was delighted to see. There was total agreement that it was essential for the President of the European Commission to be given a much stronger role in the political and other management of this important institution if the Commission was to become more effective and to be given greater legitimacy, particularly as the number of Member States increases in the next century. In particular, it was decided - leaving it up to the lawyers to consider the finer details - that the European Council will appoint the President of the Commission in a four- or five-phase procedure, subject to confirmation and approval by the European Parliament. Then there will be a phase where Member States appoint their Commissioners, in agreement - I say agreement, but I cannot think of the precise legal term - with the President. So there will be consultation and agreement on the appointment of Commissioners. Subject to the Member States' powers of nomination, the entire Commission must then appear once again, figuratively at least, before the European Parliament to obtain its seal of approval.
The European Council also clearly wants the internal organization of the Commission to be rationalized in future, though this has yet to be fleshed out. The broad outlines have already been developed by the current Commission and have met with general approval at the IGC, particularly the idea that the President should have more say in the allocation and distribution of portfolios. We also need to examine, though this has not yet been discussed in detail, whether he should be given some kind of rights in this respect, but this is not clear at the moment.
What is less clear is what exactly should be done about the size and composition of the Commission. There has been a very frank discussion on how to contain the political risk which this represents, since it has grown to become the most politically sensitive issue for the Member States at the IGC. The possibility raised during the discussion that some Member States might no longer be represented on the Commission in future, but would have to take part in rotation, met with considerable opposition from a number of them. It became clear that this issue presented a considerable threat to the entire outcome of the IGC if it was not handled very carefully and resolved to the satisfaction of all the Member States.
The indication at Noordwijk was that this issue should not be pushed too far, which may imply that the decision on the size and composition of the Commission will be left until the time comes in the accession procedure when it has to be settled. The real problem comes if three, five or six countries are admitted and they all want their own Commissioner, and it is clearly seen as an option to defer the decision until that time.
A great deal of time, within the constraints that very busy people always face, was spent discussing the issue of reweighting votes and the qualified majority. It was clear that a considerable number of Heads of Government regard it as extremely important to find a fair and acceptable solution to this question, bearing in mind that the majorities to be obtained must be seen to be legitimate. Agreement has yet to be reached on the method to be used. Some Member States are in favour of a double weighting or ratio, while others support a reweighting of the votes within the Council. There are all sorts of variations, on which no decision has been taken. However, the one issue that needs to be closely examined in the context of institutional relations and which is particularly sensitive is the extension of the qualified majority under the third pillar.
Finally, Mr President, there is something that is not directly connected to the European Council but follows on from what you said at the beginning of your address to the Council of Ministers three weeks ago. You proposed that the Intergovernmental Conference should not make foreign policy spending compulsory expenditure, and you offered to enter into an interinstitutional agreement on behalf of Parliament to regulate relations on this issue. The offer was taken up by the President of the IGC, Mr van Mierlo, who was authorized by his colleagues to negotiate on this. What I would like to tell you now is that this is still the intention of the high contracting parties at the IGC, and that as far as I am concerned, the results of the first exploratory talks that you and I have held have been extremely encouraging. I would like to thank you once again for the initiative you took three weeks ago in the Council of Ministers.

President
Thank you very much, Mr Patijn.
You have the floor, Mr Oreja.

Oreja Aguirre
Mr President, Mr President-in-Office of the Council, ladies and gentlemen, barely three weeks from the European Council in Amsterdam, where the Intergovernmental Conference must conclude its work, this is a good moment for assessing the progress made so far and to reflect on the objectives of the Conference following the recent informal European Council in Noordwijk. Fourteen months on from the Turin Council, I should like to point out the commonsense of the contribution made by three 'actors' . First of all, the successive Presidencies of the Council, in particular the Dutch Presidency, whose document presented at the meeting of personal representatives in Houtem is, in my view, probably the likeliest to be accepted by the governments and the minimum acceptable by public opinion; for that I must, in particular, congratulate Mr Patijn on his work, without whose determination it would probably have been impossible to reach these results.
Secondly, the Opinion of the Commission of 28 February 1996, which is a point of reference for expectations for the Conference.
Thirdly, I should in particular like to mention the importance and constructive contribution of the European Parliament, its representatives, Mrs Guigou and Mr Brok, and the action taken by the President of the European Parliament, at the Conference of Ministers and the European Council.
Now, at the risk of stating the obvious, I should like to reiterate the reasons for which the Intergovernmental Conference was convened in the first place. The Conference was convened with three aims: to boost political union, prepare the Union for enlargement and meet the terms of reference of the Maastricht Treaty which, on certain issues, already foresaw the convening of the Conference in 1996 and which, inter alia , sought the establishment, in the future Treaty, of the identity of a common European defence.
We might ask whether the Conference has so far met those aims. I think that, in order to be able to make an accurate assessment at this moment in time, we would have to establish exactly where we stand and exactly where we are going. The first point has already been dealt with by the Presidency of the Council. Would you therefore allow me to concentrate on the future: where are we going? Where is the Conference heading at this moment in time? How great is the ambition of the future Treaty? Having reached this point, I should like to tell the European Parliament that I am confident that we are able to conclude it satisfactorily. However, I will not conceal my concern, because we are now in the home straight of the negotiations and there is still a lot to be done, and I am therefore concerned because it seems vital that the Conference should conclude with a level of ambition which will enable the European Union to be able to meet the challenges facing it in the years to come.
Europe needs a far-reaching reform, to strengthen its democratic legitimacy, to improve the effectiveness of its institutions, to meet the concerns of its citizens, and to enable us to speak with a single voice in the international arena. Please allow me to recall the way in which the Conference - in my view and that of the Commission - is looking at these aims. As far as bringing Europe closer to its citizens is concerned, in my view there are two major questions: employment and social policy, and cooperation in judicial and internal matters.
As far as employment is concerned, the Conference's work has led to a so-far positive result, in that there is a consensus among the Member States that the new Treaty should include a chapter on employment. In the framework of the Essen Strategy, the inclusion of specific provisions on employment will make it possible to improve the coordination of national policies and will also to consider employment as a question of common interest for all Member States, to facilitate the exchange of experiences and to be more effective in the fight against unemployment throughout the European Union. However, I must express my concern over one very practical point: the risk that incentives for job creation might well disappear from the original text because of opposition from certain states. I think that that would undermine the effectiveness of the European Union in social matters. I also think that it is essential that that should be maintained in the future Treaty. As far as social policy is concerned, the social protocol will be included in the future Treaty, thereby putting an end to the anomalous situation accepted in Maastricht. Nevertheless, I am concerned at the maintenance of unanimity for taking major social decisions, something to be incorporated mechanically into the text of the protocol to the Treaty. I think, however, that following yesterday's session notable progress has been made over issues of fighting social exclusion.
As far as judicial and internal matters are concerned, the Conference has concentrated its work on three main subjects: first of all the 'communitarization' of questions relating to asylum, immigration, external border controls, visas, administrative and civil judicial cooperation, ensuring the full participation by Community institutions, progressively, over a number of stages. This process, initially based on a right of initiative shared between the Commission and the Member States, with unanimous decision-taking, would lead to a final stage when the Commission would have a monopoly of the right of initiative and decisions would be taken by a qualified majority. This question has not yet been concluded by any means or the form of participation by the European Parliament which, in the Commission's view, should be the codecision procedure.
Secondly, a substantially improved third pillar with new judicial instruments and, for the first time, the participation of the European Parliament and a certain role, albeit limited, for the Court of Justice.
Thirdly, integration of Schengen into the Treaty, through a protocol which would make it possible to integrate into the Union strengthened cooperation between various states over the 'Europe of Security' which has been developed so far, as everyone knows, outside the Treaty. Despite the definite ambitions of the text produced by the Dutch Presidency on these areas, I should like to tell you what my main concern is at the moment. My concern is that, in the run-up to the final negotiation, as a consequence of the difficulties raised by this text, the result might be rather more modest. If that were the case, that would in some ways dash the expectations of our fellow citizens who would like to enjoy fully effective and greater freedom of circulation within the European Union in order to be able to travel, live or work in another Member State. They also want immigration policy and the control of external borders, and the fight against organised crime to develop effectively, alongside the freedom of circulation. I think it would be regrettable if the final negotiation were to stumble and frustrate our aims, maintaining the status quo. That would probably be the major failure of the Intergovernmental Conference. I wonder how we could explain to our fellow citizens that, after so many months of negotiations, it was impossible to make any progress on this subject.
Another subject which seems to me to be extraordinarily sensitive for our fellow citizens is that of the protection of public health. In order to enjoy a high level of protection in respect of all Community policies, the main novelty is, in the new Article 129, new judicial bases guaranteeing the adoption of binding rules by a qualified majority and in codecision with the European Parliament. I think it is absolutely vital that the European Parliament's full participation in this should be guaranteed.
Another issue that I would like to mention and which the Presidency of the Council mentioned a few moments ago is 'simplification' . It seems that we are unable to present clearly the result of the Conference in a Treaty text in which the provisions are merged and restructured. Unfortunately, we have not achieved this aim.
I shall now refer very briefly to the chapter concerning the common foreign and security policy. I think that, on this score, the future Treaty will introduce improvements to the instruments and procedures for decision-taking. The creation of the 'planning and analysis cell' will enable the European Union to have a capacity to anticipate and process the basic elements in foreign policy, with the existence of a Secretary General, alongside the Presidency of the Commission, to ensure the European Union's representation abroad; for that is necessary to have full coherence between the Council and Commission throughout the procedure. I think that it will also be possible to facilitate decision-taking by the use of qualified majority by means of a mechanism separating decisions by consensus in the European Council and by majority in the Council of General Affairs. This involves anything to do with constructive abstention which is being prepared in the Conference debate.
Now, all of these technical improvements will be insufficient if there is no clear political will among the Member States to develop a truly common foreign and security policy or, in other words, we must avoid the risk of introducing more bureaucracy into the common foreign and security policy. Europe must have an external policy which enables it to speak with a single voice on the international stage, together with a credible defence policy, in order to develop it. I am not going to insist on the subject of financing the common foreign and security policy, since it was referred to just a moment ago by the Presidency of the Council. I have every confidence that this interinstitutional agreement will soon have a happy ending.
As far as trade is concerned, it is vital to improve the efficiency of our action, in particular at the World Trade Organisation. In the past, Article 113 permitted a common and effective action in respect to our partners in the trade of goods. Nowadays, as you know, commercial trade is developing at a growing rate, especially in terms of services, intellectual property and investment and, therefore, Article 113 must be adapted to this new situation. Unless we continue to modernize our common commercial policy at this Conference, Europe will have lost a perfect opportunity to locate itself at the forefront in terms of our competitors and I must confess to you that I am very much concerned by the fact that, in the run-up to the final negotiations, the text drafted by the Presidency might again be weakened and could even lead to a regressive wording. If that were the case, I think that it would be preferable to make no modifications at all and actually maintain the current version of that Article.
I shall conclude with a few words on the institutions: the third main chapter of the negotiations is institutional reform. The Commission's subject was the subject of debate at the informal European Council in Noordwijk and has already been referred to extensively by the Presidency. I have little to say as a result. One subject mentioned was that of strengthening the powers of the Presidency of the Commission, and the effectiveness and legitimacy of the European Parliament, through ratification of the designation of the European Council.
There are other matters pending, however and, probably, they will still be on the negotiating table at the eleventh hour. I am referring, in particular, to the subject of qualified majority. We in the Commission have repeated until blue in the face that maintenance of unanimity in an enlarged Union would lead to paralysis. On this matter, the status quo is unacceptable. It is possible to allow exceptions and qualified majority for constitutional matters and quasi-constitutional matters, the accession of new Member States or own-resources, but qualified majority must be the rule if we are to prevent the European Union from hurtling towards paralysis and ineffectiveness.
Let us now look at the problem of codecision. I am going to be very clear on this: the extension of codecision to legislative matters cannot, by any means, be considered as a mere concession to the European Parliament or to sectors which are more inclined to be partisans of European integration. I am very concerned that this might be the attitude of certain participants at the Conference. Codecision is a basic principle which must lie behind the constitutional structure of the European Union itself, both for economic and social matters and all areas affecting the rights and obligations of our fellow citizens. It seems to be unthinkable that, in the future, the European Union could do without political mediation representing all social forces and European citizens when taking decisions that are to set the trend for various policies. It is a fundamental requirement of democracy.
I will conclude, Mr President, with one last thought: I am well aware that I have left out many very important matters in my address. I preferred to concentrate on what seemed to me to be essential. I am sure that, as the debate goes on, many questions will arise and will be asked by Members of the European Parliament, and if anyone refers to the fact that I have not mentioned flexibility, may I remind you that, on this subject, we held a special debate in the plenary session of the European Parliament a few months ago. But, for me, the important thing at this moment in time was to make an appeal to all the political forces present in the European Parliament over the situation facing the Intergovernmental Conference. It is a critical moment. The next three weeks will be decisive as to the model of European Union that we wish to design for the future. The final negotiations will be very tough, compromises will be difficult, national interests on many subjects will be divergent, and nothing has yet been decided, nothing has been won or lost for good. Therefore, the Commission wishes to call on the European Parliament to appeal, along with the Commission, for the Member States to make one last effort in the run-up to the final negotiations.
At this moment in time, a lot is at stake at this Conference: we are capable of constructing a strong, credible Union, capable of deepening its political union while opening up to enlargement, without dilution, while maintaining the dynamism of the Community method of integration, and this is undoubtedly our great challenge. To renounce that objective would mean renouncing our own destiny, weakening the ability of the Union and each of our fellow citizens, and refusing to be present on the international economic and political stage. That is why I am making this last appeal to the European Parliament. I think that we really must join forces to make sure that the future Treaty preserves the European model of society, a model for which the European Parliament and the European Commission must be willing to fight.

President
Thank you very much, Mr Oreja, for such an informative statement. I again thank Mr Patijn for his informative report.
I give the floor to Mrs Green.

Green
Mr President, I want to begin by thanking both the President-in-Office of the Council and Commissioner Oreja for their contributions today. It was in accord with his positive and sunny nature that the President-in-Office of the Council gave us his usual optimistic version of what he thinks is going on in the IGC. Commissioner Oreja was just a bit more realistic, if not to say a bit more honest in his assessment of the way in which we think it is going.
In this Parliament I hope there are none - certainly in my group - who wish to be negative, difficult, or awkward. We want a positive outcome to the Amsterdam Summit. We are determined there will be if we can have any influence on that process because it is crucial for the development of the Union into the next millennium that we have a positive outcome. But, if we listen to the President-in-Office's report, it is indicative of the fears and anxieties of the people of the European Union.
He made clear that the major politically-sensitive issues are those concerned with the institutional questions. I would rather he had said that the major politically-sensitive issues were about how we could really strengthen employment creation and the social dimension, move forward on creating a better environment, better consumer protection, better public health. My anxiety about what he said is that those issues are already the process of a large consensus which means that they are already decided and there is not much in them. That is why it is so easy to find political consensus on them.
It is important that we make politically clear that the citizens of the European Union are concerned about job creation. If we are serious about a chapter in the Treaty that deals with job creation, our citizens do not just want pious words. They want at least the Treaty to give us the right to start to coordinate our macro-economic policies to generate job creation at European Union level. That is the only way that the employment chapter will have any meaning.
Similarly, on the social dimension, I am delighted that the social protocol will be integrated into the Treaty of European Union and delighted that 1 May, Labour Day, saw the election of a Labour Government in Britain that will allow that to happen. But we want to see some strengthening of that social protocol as well. We also want to see a move forward on gender equality and on an anti-discrimination clause with some real meaning. And we want to see these dealt with by qualified majority voting and co-decision and not by unanimity which I suspect we may see, certainly on the anti-discrimination clause.
These are the things which affect people in the Union. These are the things which should be driving the last few days of the IGC, to make these things stronger, to make the message clear to our people. Commissioner Oreja made a very telling statement when he said that what we have is the minimum that public opinion could accept - the minimum! And that worries me and my group very much. We want to see the Union moving forward but its first priority must be to deal with those issues that have so destabilized public opinion in the European Union countries themselves about the value of the European Union to them and their families.
Let us see a real drive forward, not just pious rhetoric about these issues but a real step forward in the Treaty. My group will be assessing the Treaty on whether it meets the aspirations of the people of the Union.
It must also make the Union ready for enlargement and that means institutional changes. We could have hoped that our heads of government could have understood that in order to have an effective and efficient Union we must have institutional changes. They should be automatic if we are going to see the enlargement of the Union to the countries of Central and Eastern Europe. So there really is an imperative to prepare the Union for enlargement by dealing firstly with the institutional situation that needs to be remedied. For instance, we need to reduce the Union's decision-making procedures to three and we want to see that happen. It has been the demand of this Parliament for a long time and we hope it will happen. And of course we want to see the extension of qualified majority voting and co-decision. We want to see all those things that will ensure that this Parliament's rights are maintained.
We cannot and will not accept the diminution of any of the present rights of this Parliament - either its budgetary or legislative rights - in any field. I hope that will be taken back very clearly to the Intergovernmental Conference.

Brok
Mr President, ladies and gentlemen, I should like to extend my special thanks to the Presidentin-Office of the Council and to Commissioner Oreja, not only for their words to us today, but also because I have had the impression over recent months that they have both been prepared to look in detail at the arguments which Parliament has put forward, and indeed to implement a number of our proposals or contribute to their implementation. I should like to thank them personally for that.
Over the years, I have listened here in the House to a number of great speeches by great Europeans, and in recent weeks I have found myself recalling two such addresses, one by former Italian President Sandro Pertini and one by Václav Havel. Both speakers very clearly conveyed the idea that what we need is not a Europe of technocrats, but a Europe that is geared to meeting the needs of its citizens - at the service of its citizens.
When I see how intergovernmental negotiations work in practice, I sometimes have my doubts as to whether we actually measure up to that ideal. It is becoming increasingly complicated and difficult to explain European decisions to the people of Europe, to give people the opportunity of understanding who is responsible for what and monitoring who is taking good or bad decisions, and to put across the idea that people can bring their own influence to bear in order to steer things in the right direction.
This brings me to the particular issue of the European Union's capacity for action, and the Intergovernmental Conference as a preparation for enlargement of the Union. Everyone talks about extending majority decisionmaking, but everyone brings to the table their own set of exceptions, courtesy of the ministries of their national governments, and it is almost impossible for those in charge of the negotiations to prevent a zero-sum outcome. Now, as the Intergovernmental Conference draws to an end, we should remember that the principle of unanimity is the principle of mistrust and lack of imagination. The principle of unanimity is being maintained because there is a lack of trust between the partners, a fear of the majority deciding in a way that goes against individual national interests.
I think this must be seen as a painful truth, because everyone can cite their own examples of such mistrust, and I would refer to just a few points that serve to illustrate it. The Council presidency is in fact seeking to extend qualified-majority voting in the area of commercial policy under Article 113 to decisions on services, investments and copyright, for example. However, it is clear that the only way of making this work is by drawing up protocols and subprotocols setting out hundreds of exceptions - I exaggerate, but let us say a great many exceptions - and it is only subject to those exceptions that the members of the Council will be prepared to take decisions by a qualified majority.
If, then, it is to be the case that every time the principle of majority decision-making is extended on a particular issue, there has to be a special preliminary agreement in the form of a protocol, the end result will be a situation which - while it may empower the Union to act - will leave it legally hamstrung and rob it of all vitality. And I could cite many more examples of such an outcome.
So what is the reality? There have in fact been virtually no instances of a qualified-majority decision, even with regard to internal market legislation, where any country has had to sacrifice its national interests, or lost a vote. Ultimately, even where decisions have been taken by qualified majority, the negotiations have still been conducted on the basis of the principle of consent. Why, then, can this approach not also be applied in other areas?
What are the implications of this situation as regards enlargement? A number of Member States have not yet considered the fact that positions which, in their own national interest, they have so far unanimously supported will have dramatically different implications in an enlarged Community - not least from the point of view of national interest. In this context - and without going into any detail - I would mention the Structural Funds, for example.
We are still debating the principle of sovereignty, but still only in terms of its formal aspects rather than its real substance, and ordinary people are several steps ahead of us here. In discussions concerning the third pillar and those aspects of the third pillar which should be brought under the Community umbrella, we often hear it said that this or that is not feasible and that national sovereignty is at stake. Ordinary people have not the slightest interest in this. My point is that they wish to see solutions to the problems we are facing, and what we need is a new form of politics, not a new form of bureaucracy. In order to make progress, we need a European foreign and security policy which includes decision-making procedures. But it must not be hedged around with so many provisos that the central idea of majority decision-making is undermined and overlayered by the principle of unanimity, thereby choking the whole apparatus.
We wish to see an improved social policy, basic rights and greater transparency. The Intergovernmental Conference may be moving towards giving the European Parliament more rights, and we would like to hope that such a move would benefit not only Parliament, but the European Union as a whole.

President
Thank, Mr Brok.
I give the floor to Mr Azzolini.

Azzolini
Mr President, ladies and gentlemen, we shall not conceal our doubts and concerns as regards the progress of the IGC's work, as revealed yet again at the recent Noordwijk summit. Although we appreciate the tremendous efforts of the Dutch presidency and the cooperative spirit of many Member States, for which my group is sincerely grateful, it has to be said that at Noordwijk - where, just a few days prior to the Amsterdam European Council, agreement should have been reached on extending the application of the Maastricht Treaty - what prevailed once again was the nationalism of the past. A good deal is at stake, of course: an increase in the European Union's powers implies a gradual abandonment of national sovereignty. So it hardly comes as a surprise that ideals give way to partisan interests whenever national prerogatives are called into question.
We cannot believe that, as the eminent Spanish professor, Rafael Gómez Pérez, put it, the European ideal is now a spent force. Once, the idea of Europe conveyed the notion - in a cultural sense - of a common home; yet that natural feeling of 'being European' has faded with time, because Europeans have lost their sense of togetherness, and have stopped thinking about and striving for true European unity. But we believe that Europe has much to offer to itself, its own citizens, and the whole world. To do this, however, it also needs, above all, to add a political dimension to its presence on the international stage by strengthening its policies and institutions, first and foremost the European Parliament, and by fully involving its citizens. Such is the spirit with which, in our opinion, the IGC should be imbued, in order to rewrite a treaty which is no longer equal to the major challenges of the coming decades.
As everyone knows, the European Community has certainly taken huge strides forward since its inception, but that is not enough. We want a Europe which does not betray the spirit of its founding fathers, who saw the political dimension as its true strength; we want a strong, free, democratic Europe, serving our citizens' needs and offering them prosperity. As the European Union's powers increase, however, a solution must be found to the serious problem of its democratic deficit: powers - and, consequently, democratic control - cannot be removed from the national parliaments merely to increase the powers of unelected decision-making bodies. These powers must be finely balanced. An expanding Europe, which is seeking a high-profile political presence on the world stage and aiming to become dependable and strong, must enter into a clear pact with its citizens: either their full sovereignty is recognized, through democratically elected institutions with full powers, as in any democracy, or they will feel that they inhabit not a common home, but a mere geographical entity with centrally controlled and remote supranational institutions.
Mr President, the citizens of Europe must not be forgotten when we reform the European Union!

Brinkhorst
Mr President, this is the penultimate time that Parliament will be discussing the IGC before decisions are taken at Amsterdam. It is clear that every group has its own desiderata. Here are the four points on which we in the Group of the European Liberal, Democratic and Reformist Party will judge whether or not Amsterdam is a success.
First, codecision. A great deal has been said about this. Codecision is essential in every field where there is legislation. We are concerned that where sections of the third pillar are to be transferred to the first pillar, justice and home affairs are likely to become qualified majority fields, but Parliament will not be able to exercise its rights as much as it would like. It is vital for the Court of Justice to have a role to play here, as the guarantee of a genuine constitutional state. Article H is a monstrosity in legal terms, Mr Patijn.
Next, the qualified majority. There are still 35 cases where unanimity is required. The Community cannot function like this. Can the President of the Council assure us that the presidency will take new measures to try to reduce the number of cases requiring unanimity?
Thirdly, a common foreign and security policy will not work without the necessary instruments. The Western European Union needs to be integrated into the European Union if we are to have credible instruments for pursuing a foreign policy. Such instruments do not currently exist, and the Western European Union is appearing more and more like a NATO satellite, rather than an instrument of the European Union.
Finally, simplification. I am sorry to see that the Presidency's proposal contains a token entry, as Mr Oreja mentioned. People will judge this treaty on whether or not there really is new simplification and new clarity. The fact that the present text is unclear is down not to the Dutch presidency, but to the impotence of the Council, which has actually succeeded in making the Maastricht Treaty three times as obscure. I wish the President-in-Office every success in his work over the next few days.

Puerta
Mr Patijn, Mr Oreja, as you can see, all of the spokesmen have thanked you for appearing before the European Parliament today and nearly all of us recognize that the Dutch Presidency has worked very well, as did the Irish Presidency before it; our representatives, Mr Brok and Mrs Guigou, have had good communications with you; the previous President of the European Parliament, Mr Hänsch and the present one, Mr Gil-Robles, have made an effort to communicate with and represent the European Parliament at the Intergovernmental Conference, but all of us must show our concern, nonetheless.
A Commissioner like Mr Oreja - it is impossible to find a better educated or more cautious Commissioner in the history of the European Union - has expressed his preoccupation on many occasions. He said so in a friendly tone, but he has shown considerable concern on behalf of the Commission, and I wish to express considerable preoccupation in the European Parliament on behalf of the ten million citizens who voted for the parties belonging to our group - and we are a small group. Just look, Mr Patijn, at the quantity of voters who supported the bigger groups, because this European Parliament is not an academic corporation for debating or analysing, but it is a representative body, as you well know, and respect, of European citizens.
We know that the Intergovernmental Conference is advancing since everyone has done their duty, but what about the contents? Are they up to the expectations which have been raised? Will they really respond to the political problems of our time? Of course, we support the notion that our fellow citizens should have work and employment, but there is also a political union structure. At the moment, almost ten years after the fall of the Berlin Wall, I should like to tell you - and this is not a joke - that the European people are now at the wailing wall. With unemployment, anxiety, problems, and we must share those problems and try to find solutions. Therefore, I should like briefly to give a few examples of our concerns and reasons why we are worried. As far as the method is concerned it is clear: you are looking for the final stable equilibrium in the final moments and it should be of concern to those citizens that their governmental representatives are incapable of establishing the rules of the game and a code of confidence for taking such vital decisions.
I must say that this could produce a similar situation to that when the Maastricht Treaty was drafted, in another delightful Dutch city whose name now arouses such a lack of confidence in Middle Europe, because the Maastricht Treaty was done behind the backs of public opinion and we should not repeat that situation. I do not want to hold Mr Patijn responsible - and he is making signs to me that he agrees that he is not responsible for the Maastricht Treaty - but we shall have to take clear decisions if we are not to reach the same situation. As for the content, we were meant to be taking a great step towards political union, with an institutional equilibrium, overcoming the democratic deficit. And that is not going to be the case and we are taking small steps; not even the European Parliament is able to produce an opinion on revision of the Treaties in the future. We do not think that there is going to be genuine codecision in areas as important as the budget and legislative processes.
The European Parliament has a certain mistrust, and we have to take major steps forward towards political union. We are not speaking corporately of the importance of the European Parliament but we are talking here about Europe's democratic fabric. On the common foreign and security policy, there is no political will to take those steps and, as for promoting economic and social policies at the service of the ordinary people, we are very much afraid that we are not going to achieve this. There will definitely be a chapter on employment and a social protocol will be incorporated - probably better than the previous one - but the main objective is not rhetoric about employment or limited social policies of an 'assistance type' , nor creating social and economic policies which are not totally subordinate to the convergence criteria.
I do not have enough time to talk about the lack of solutions for the problem of enlargement. This is a purely transitory situation but I would ask you, Mr President-in-Office of the Council, that we should not leave everything for the Conference to the last minute and I hope that we are not going to end up with a few crumbs which will be no solution for the problems of the European Union, its peoples and its citizens.

Roth
Mr President, ladies and gentlemen, one of the issues at stake in this debate is the role that we, as the European Parliament, ascribe to ourselves. Are we to adopt an amicable stance towards the forthcoming Intergovernmental Conference in Amsterdam - a quiet and unassuming attitude? Are we to play the part of supplicants, imploring the Council to grant us more rights? Are we prepared to go to any lengths - short of rebellion - in order to win a little more or lose a little less as a reward for good behaviour? Are we an extension of the national governments, hastening to show obedience by refraining from making essential demands of the Intergovernmental Conference? No indeed - that is certainly not our role!
I am convinced that the very specific task of the European Parliament, here and now, is to do some straight talking, because what is at stake is nothing less than the ability of the European Union to face the future. What is at stake is the establishment of a real European democracy, a balance between political and economic integration in Europe, and the development of a common, non-military foreign policy. What is at stake is a total European perspective that will enable the Union to be enlarged. However, when I turn to consider the proposals which have been tabled so far, I really have to conclude - and I do so with a good deal of dismay and concern - that the governments of the Member States are in the process of reforming the European Union in a way that will further erode democracy, transparency and openness, replacing them with technocratic, intergovernmental procedures - supposedly in the interests of greater efficiency - and by doing so will jeopardize the original concept of developing European democracy.
The draft treaty that has been submitted is not an adequate response to the social, environmental and democratic crisis in which the Union finds itself; not only is it inadequate in terms of reform, but it is also steering us in the wrong direction. Statements on human rights and non-discrimination are not worth the paper they are written on unless there are legally enforceable guarantees. Freedom of movement of persons - one of the greatest benefits that the European Community has to offer - is to be postponed indefinitely. The so-called communitization of elements of the third pillar is a pig in a poke, because the introduction of the qualified majority principle is not coupled with codecision powers for the European Parliament and competence for the European Court of Justice. If you look at Chapter H, you will see that the opposite is true: the remit of the Court of Justice is being reduced.
It is planned to expand Europol and give it operational responsibilities without extending the mechanisms for democratic supervision. This is an erosion of the principles of government by the rule of law! A common foreign policy must be a policy for peace and security, with the aim of setting up a Europe-wide security system; integration into the WEU is exactly what we do not need, and would in fact represent a step towards the militarization of the European Union, which used to be a community dedicated to promoting peace.
Another revealing feature is the obvious purpose of the objective of full employment: the promised chapter on employment has become a piece of high-sounding political verbiage without any binding force - the height of irresponsibility, given the mass unemployment that we face. So it will scarcely come as a surprise that the European Parliament may not get the additional rights that were spoken of by the third great European of the week, Elmar Brok, but may in fact end up with fewer rights, for example in the budget. Instead of rejoicing, we ought to be on red alert, because this Maastricht Treaty Mark II will make the future of Europe less secure.
(Applause from the Green Group)

Dell'Alba
Mr President, ladies and gentlemen, I should like to ask the President-in-Office of the Council - as well as the chairman of the representatives negotiating the new draft treaty - whether he has noticed the rare degree of unanimity which has so far echoed around this House in our comments on what is taking place, and on the draft text which he himself has referred to in optimistic terms, unless I am mistaken.
The reaction in the House seems to me to indicate the level of concern felt in Parliament, concern expressed likewise by the Commission, moreover. I know that the work is to be completed this weekend; let us hope that the draft treaty will be available in time for us to respond in detail on the individual points at our earliest opportunity, in June, prior to the Amsterdam summit.
But let me issue a word of warning in a political vein, as other colleagues have done, Mr President-in-Office. Please remember: 16 and 17 June represent an important stage, of course, the stage at which you had hoped to conclude these negotiations. It seems to me, however, that you have reached it in the worst possible way, through a series of set-pieces, with only minimum agreement on the minimum content of a revised Maastricht Treaty. Without going into detail, I would merely ask you whether you think that 16 and 17 June are the sole opportunity to finalize this text, as if agreement among 15 Heads of State and Government were in itself sufficient and there were no need - as we saw with Maastricht - for as much public endorsement as possible in our Member States. What, I wonder, will the people stand to gain, if the treaty reform is to take the shape that is now emerging in a piecemeal way?
Never before has European foreign and cooperation policy been as negative as in recent years, since the CFSP was codified, and never before has it led to such political inertia. Your response to this situation is to strengthen intergovernmental mechanisms wherever possible, and even to propose that the whole affair should be managed by a middle-ranking official.
On all the other issues, your response is not a political one: it is a technical response, a weak one which we fear will not be supported by our citizens. Please think this through and bear in mind that, if there is not yet sufficient substance, 17 June might perhaps not be the last opportunity to finalize the new draft treaty.

Cellai
I hope that the President-in-Office of the Council and Commissioner Oreja will forgive me for highlighting the discrepancy between the broad optimism of the former and the deep concerns - the realism, perhaps - of the latter. Of the two positions, one is obviously forced, to put it mildly. What kind of European Union is emerging, Mr Oreja? Certainly not a political union which faithfully reflects European ideals, and certainly not a social Europe which is more than a mere talking-shop, given that certain nations are still putting obstacles in the way of innovative solutions to the tragedy of growing unemployment. The social clause alone is not enough, and nor is the social protocol; there is little cause to be optimistic concerning the outcome of the Amsterdam European Council next month.
There is a risk that the IGC, which it appears has to end by a certain date, come what may, might achieve very little and could fall flat after all; but why not postpone it, given the likelihood of a minimal outcome?
Reading between the lines of the Noordwijk summit, one realizes that the European Union might turn out to be nothing but a 'ministocracy' . How else is one to interpret the fact that the people negotiating the institutional reforms - and not only those - are government representatives, unelected by the people and responsible for rampant bureaucracy? And how much attention is being paid to the fears and anxieties of the 370 million EU citizens in this process?
Fifteen Heads of Government, plus 15 Foreign Affairs Ministers, met for five hours without clearly tackling and resolving even one of the difficulties which have been holding up treaty reform for a year. What kind of Europe are we building? Certainly not one which interests our citizens, whose concerns lie elsewhere: the unemployment, poverty, social exclusion and violence which are afflicting all the EU countries. So is it really necessary to enlarge the Union before deepening it? Or rather, is there not a need to make it function better and equip it to meet the challenges, both internal and external, that are now confronting it? No new accession can be properly dealt with until the institutions have been thoroughly overhauled to allow for greater political integration. The Union must be deepened economically and politically on the basis of a strong political blueprint, otherwise that much-vaunted economic and social cohesion will become nothing but a sad, pathetic mirage and Europe, perhaps, a dream to be postponed yet again.

David
Mr President, I am pleased that good progress appears to be being made. That is no doubt down to the skill of the Dutch presidency but I would also suggest that it has something to do with fact that in the United Kingdom there is a new government. This government is practising what it preached in opposition and has determinedly opened a new chapter in its relationship with the rest of the European Union.
To date, and particularly in the so-called non-paper, there is a clear evidence of progress being made: the incorporation of a social protocol into the Treaty proper, the creation of the employment chapter, sensible extension of qualified majority voting, tougher provisions against fraud, the commitment to extend co-decision powers with Parliament, more practical arrangements for CFSP and recognition of the anti-discrimination issue as the hallmark of a democratic, free society. All these are positive measures and we should not underestimate their significance.
As has been said, there are still difficult issues which need to be resolved: free movement, the future of the WEU, the number of Commissioners and the vexed issue of flexibility. But what is singularly impressive at this point is the genuine desire among all the Member State governments for a real agreement to be reached. We should celebrate that fact. If agreement can be reached at Amsterdam, it will give us a base to go forward and to tackle so many of the issues which the people of Europe are concerned about. It will give us a base to reform the common agricultural policy, a base to complete the single market and generate jobs and growth. It will give us a base to create a citizen's Europe and it will give a base to prepare for the process of enlargement which is the next big issue on Europe's agenda.
However, I have to say that is not enough. I sincerely hope that careful note is taken of the comments from Members of this House today. It is not simply enough to have a Treaty on which there can be a minimalist agreement. We need a Treaty which inspires people, which pulls people behind it, a Treaty which can point us to a much better future and inspire hope and confidence. A minimalist agreement will not achieve that. That is why it is so very important that note is taken of the comments here. Let us hope that this agreement will not only be one which this Parliament can meekly accept but one for which we can be positively enthusiastic.

Maij-Weggen
Mr President, after the informal European Council meeting in Noordwijk, the Dutch presidency said that the discussions had been constructive, and that the Heads of Government were determined that there should be an Amsterdam Treaty. The Dutch Prime Minister subsequently announced that a decision had already been taken to strengthen the position of the President of the European Commission. This sounds all well and good, but there is one point I would make here, in line with the criticism voiced by Mr Brok.
To decide that the President of the Commission should be proposed by the Council, subject to the approval of the European Parliament, and to give him the possibility of recruiting his own Commissioners is certainly putting him in a much stronger position. But to then immediately decide to appoint a secretary-general for foreign policy at the Council means that while the Commission President's position has been strengthened, the position of the Commission itself has been weakened. The Commission President has been given proper attire, while the four Commissioners responsible for foreign policy have been stripped of their clothes.
I would remind you that Parliament has rejected the idea of having such a secretary-general at the Council on many occasions. It is a bureaucratic and technocratic solution to a political problem. We also wonder whether future Commission Presidents will be able to dismiss individual Commissioners? Parliament has always proposed that it should have the right to dismiss Commissioners who fail in their duties - what is the position on this?
My second point concerns another subject of great interest to the House: making the Union more transparent and democratic. Parliament currently has the final say on around two thirds of the legislation and two thirds of the budget. I understand that a certain amount of progress is to be made in the area of democratic controls on legislation, but I have also heard that at least 35 to 40 subjects are to continue to require unanimity. This appears far too great a number to me to be talking about a breakthrough, and the situation seems even worse when I hear that although some of the police and justice policy is to be communitized, Parliament's role is not to be strengthened accordingly. I find this totally unacceptable, and I think we must warn the Dutch presidency that we will not tolerate another hole in the fabric of European democracy.
The reports about Parliament's budgetary powers are even worse, indicating that there is no chance that the House will be given the final say on the compulsory section of the budget. This involves the agriculture budget and the EDF, a total of ECU 50 billion. It is quite ridiculous that such a huge amount of money should remain outside Parliament's democratic control. What is even more serious is the fact that the Dutch presidency also opposes the idea of Parliament having such powers, and made its views so plain that a motion was adopted in the Netherlands parliament calling the Dutch presidency to order on this point.
Moving on to the subject of vote weighting, the current arrangements are generally regarded as satisfactory, so any reasons for changing them need to be good ones. We feel it would be best if we could maintain a fair balance between the large and small Member States after enlargement. What we do not want is for the large states to shout down the small, as happened 40 years ago. As the largest of the small countries, the Netherlands must stand up for them and for itself, otherwise there will be a domino effect.
One final comment about the lack of transparency. I understand that documents on legislation are to be made available sooner for the general public, the national parliaments and the European Parliament. We welcome this as an urgently needed measure. However, there does not seem to be any similar good news about the openness of the Council's decision-making process. Is it to carry on taking decisions on legislation behind closed doors, like some sort of Politburo? How can we ask the countries of Central and Eastern Europe to democratize if we do not do this ourselves?
To sum up, Parliament will be happy to support the Council on any progress it makes in the Amsterdam Treaty, but we can never accept its failure to reduce the democratic deficit in Europe, which is even being increased in certain areas. I wish the Dutch presidency every success, but the question is not whether we will have an Amsterdam Treaty, but whether we will have a fair and acceptable treaty in which everyone is respected, not least by our own citizens.

van Bladel
Mr President, if we are realistic, we cannot have any particularly high expectations of this review of the Maastricht Treaty. The Dutch presidency has never given the impression of wanting to make any over-ambitious changes, but instead seems happy to make more modest collective progress. It has been hampered in this by the elections in the United Kingdom and France, and the only question now is whether even modest progress is still possible.
In my opinion, this review of the Maastricht Treaty has come too early, and has now been completely overshadowed by the significance of yesterday's NATO meeting in Paris. Let there be no mistake about it, this was our guarantee of stability in Europe. Nevertheless, we still have to ask ourselves what else the Union can do to make itself a fit place to live in for its new inhabitants, and the answer, I think, is to provide greater security. Countries should be more prepared to cooperate, but the question is how. Why are we always given technical answers to our requests, as Mr Dell'Alba said, rather than political, practical ones? Why does no one ever say that we are going to clamp down on hashish coming from Morocco via Spain and France, heroine from Turkey via Germany, and cocaine from Surinam via the Netherlands? The Dutch presidency recently received questions on this from Mr Donnay and Mr Pasty, but it has not responded. Are you not brave enough to answer, or is the Dutch presidency hiding something?
The Council is largely to blame for the deepening democratic deficit, and I have unfortunately not detected any signs of improvement. I also think, and here I totally agree with Mrs Maij-Weggen, that it is not a good sign that the Commission is to be made more efficient by giving its President greater powers. This is approaching it from the wrong direction. We are starting from the top, whereas in fact we should be cutting down on the number of Commissioners.
Parliament sees it as a bad omen that it is not to have wider powers when it comes to legislation and the budget. However, I am at least confident that this presidency has firm plans to make the Union more governable in order to restore public confidence as we go into the 21st century. And we should not be too pessimistic: there are still three weeks to go before the Amsterdam summit, and as Commissioner Oreja said, there is still everything to play for.
Keep up the spirit of Noordwijk, and try to ensure that the changes made are those we need for enlargement and a stronger role for Parliament. I wish you courage.

Wiebenga
Mr President, this is Parliament's last opportunity today before the June summit to say exactly what it wants, and I shall be focusing my attention on the area of justice policy. I have to say, looking at the documents available on this, that I have very mixed feelings. Fighting crime and police cooperation are not to be communitized, and I would ask the presidency to explain how you can fight crime effectively at European level without unanimity.
Parliament's position in the area of justice policy under this pillar is also still too weak. The Court of Justice has fared rather better, though there are still a number of points to be criticized. And although the communitization of asylum and immigration policy is a good thing in itself, it does also raise certain questions. I feel, like Commissioner Oreja, that this is the absolute minimum that needs to be communitized, and if even this is not done, then the whole thing is likely to be a disaster.
Mr Patijn, my fellow countryman, knows the expression 'the emperor's new clothes' : it is probably universally understood. He knows that in the story the people rejoiced, but in fact the emperor had no clothes on at all, and this is what he must ensure does not happen here. I wish him fortitude in the forthcoming negotiations. My thanks to you and to Hans Christian Andersen.

Miranda
Mr President, there has been quite a lot of talk about the citizens of Europe, but what we know already and what has been confirmed to us today about the evolution of the IGC negotiations leads to an inevitable conclusion: that the reservations, doubts and criticisms raised by the previous revision of the Treaties have not been taken into account. Worse still, it seems that we are still heading in the same direction! Above all, that is clear from the refusal, as we know, to reconsider seriously the most relevant and consequential problem which, as everyone knows, is EMU itself.
Again we hear of the possibility of including a social protocol in the Treaty and a chapter on 'employment' in the same text. This is something that we have asked for consistently but I should like to stress the fact that we should harbour no illusions about the effective scope of that decision, if ever it does come about. That is because solving social problems, especially the enormous problem of unemployment, calls, above all, for new macro-economic policies and fundamentally the abandonment of the current monetarist fixation which we are all aware of. And that is not being done!
There are reasons for apprehension in other areas, too. There are no prospects, for example, for filling in the democratic deficits that we are all aware of. Once again national parliaments are being forgotten and they will have, as we know, to ratify the revision of the Treaty.
There are proposals on the negotiating table at other levels which also lead to serious objections. For example, concerning the weighting of votes in the Council of Ministers, and concerning proposals as to the future membership of the Commission, that would, in the long run, lose its universal character, despite being and continuing to be the only institution with the ability to initiate legislation.
Another concerns strengthened cooperation through the definite type of exclusion which underlies it and which would reveal a trend towards setting up 'directoires' , plus the problem of integrating Schengen into the Treaty.
Of course, we shall wait for the outcome but, at this moment in time, we cannot hide our considerable nervousness about what is likely to emerge.

Voggenhuber
Mr President, ladies and gentlemen, the Dutch presidency is reluctant to appear before the House. There have been numerous delays - and the situation has attracted comment again this afternoon. Many Members of the House entirely fail to understand and are highly critical of the presidency. But I understand very well - I too would be afraid to appear before the elected representatives of the people of Europe and present them with the likely results of the current Intergovernmental Conference.
I too would fear that Parliament might recall the promises which were made after Maastricht: promises of creating a political union, of overcoming the democratic deficit in Europe, of establishing a common foreign policy, of finding a balance between economic and political integration and creating the conditions for enlargement. But I wonder whether the President of the Council might not be more afraid of Parliament than he needs to be. Looking at the motions which have been tabled, it would seem that the majority in the House is afraid that Parliament might end up cast in the role of Don Quixote in a battle of the giants between Member States, Council and Commission.
In my opinion, there is a much greater danger of the House ending up like Sancho Panza - who was content simply to complain, to hang back eating his lunch, and to stretch himself out under the trees. And in the face of mass unemployment and the tremendous crisis of democracy and credibility in which the Union finds itself, the citizens of Europe would censure Parliament far more heavily for doing that than for taking sides in this historic argument and fighting to ensure that a historic opportunity is not gambled away - which is precisely what is happening now in the Intergovernmental Conference.
This House is not as powerless as it makes itself out to be. Should the Commission fail to support us - and for eighteen months it has failed to support us on these issues - then we can send it packing if we summon up the will and the resources to do so. We can boycott budgets, we can delay our consent for the negotiations on accession, and we can call on the national parliaments and, of course, the public to form an alliance with the European Parliament. But we have to begin by summoning up the necessary courage and strength. Whether we are prepared to do so will be the decisive question in the weeks ahead.

Paisley
Mr President, I welcome the manner in which the representatives of the newly-elected UK Government have been received by the European Council. It is surely clear as we enter a new millennium that Europe is not and cannot be a rigid unification but rather a rich diversification. For millenniums bloody wars have been fought to make it a unification. They have failed and are bound to fail.
Surely the way forward is the closest possible cooperation between the European nations, not the incorporation of those nations in a European superstate. Europe is not a country, it is a continent and therefore no structures of any known country in the world can be imposed upon it. The question of safeguarding external frontiers must be a matter for sovereign states and must be diverse as suits those states in their present circumstances and challenges. The fact is that uniformity is not necessarily unification.

Swoboda
Mr President, Mr President-in-Office of the Council, Commissioner, this non-paper contains a chapter which claims to deal with an effective and coherent foreign policy. It is quite obvious to everyone, I would think, that we are in no position to talk about coherent and effective foreign policy at the present time. Whether we look at Albania or at the situation in the Democratic Republic of Congo, we see Europe - where it actually manages to do anything at all - trailing permanently behind. The very mention of the Democratic Republic of Congo points up one aspect in particular: at a time when Europe was still in many respects allied with the former regime, a regime which people associated with corruption and personal gain, America was already negotiating with the incoming regime for mining rights and other economic advantages.
It is clear, therefore, just how important a common and coherent foreign policy is, and - unlike some other people - I believe that the activities of the Dutch presidency have been instrumental in achieving progress on a number of fronts. However, various critical observations are in order here. In the chapter which sets out to define foreign policy, I am sorry that not enough attention has been given to the question of prevention - how to avert crises, and the need to take appropriate measures - and that the focus is exclusively on the EU and WEU.
It must also be clear that unity in its broadest, long-term sense cannot be allowed to mean giving the armed forces a greater say within the EU; on the contrary, I believe that civilian elements which are geared to the tasks of peace must be given appropriate weight, in relation to the EU as elsewhere. As for the proposals from the troika, in my view it is right to set out what are in some respects transitional measures here, and I do not think that the powers of the Commission are being reduced; on the contrary, I believe that it is also very important for the Commission to be in a position of strength.
What has been said about the decision-making process is important too. However, I do have one criticism here, and I wonder how the presidency sees this point: on the one hand we have unanimity, with constructive abstention, and that is as it should be. Then, when we come to implementation, we have decisions by qualified majority, and here there is another opportunity for countries to block the procedure temporarily at least - for national reasons, of course. While I appreciate that this is a controversial area, I do not quite see how on the one hand we can have a common foreign policy, while on the other hand this same policy can be obstructed by national interest. It is my firm belief that, once decision-making procedures exist, it should not then be possible for individual Member States to block those procedures on grounds of national interest.
The same is true in relation to the chapter on foreign and security policy, and in other areas too: Parliament's role is grossly undervalued. This House has demonstrated - not least through some very recent decisions - that it is prepared to cooperate constructively on foreign policy. I would therefore call on the Council to give Parliament a voice - in other words, to give the democratically elected representatives of the people a voice - on foreign policy, as on other issues.

Cardona
Mr President, the proceedings of the Intergovernmental Conference are coming to an end. For the last two years, the negotiators have been looking at the revision of the Treaty on European Union. From our point of view, that revision is not going to achieve the aims recommended by the Treaty itself. This is a minimalist revision.
We very much regret this. It already seems impossible to reconvert some of the institutions provided for in the Treaty, apart from the fact that no progress has been made on any of the others. We must now confer democratic legitimacy on certain bodies with decisive powers and competencies within European Union - which do not have them now - making them more politically responsible vis-à-vis the different Member States.
In this case, the expectations and ambitions announced in the end will be frustrated. The main question that we want to know is whether, since the Maastricht Treaty is complex, and has only been in existence for four years, for the most part against the voiced opinion of many citizens of the European Union's Member States, it will be reasonable to expect more of the IGC. Probably not! But all of the consequences of that fact must be borne.
The process of European construction, as I see it, must be coherent and consistent, in particular because it is aimed primarily at people. Like the constitutions of each Member State, European constitutive acts must be realistic and balanced.
In a nutshell, they must enshrine all the values and principles which unite all European citizens. In no circumstances must they be the reflection or desire of a few who, while opposing the others, show that they are unable to carry out that action in practice. European construction must be built on the will of the peoples composing it and that same will must never be alienated.
I should like to conclude expressing the hope that, nevertheless, we will stop speaking about Maastricht in June and that a new era in European construction will begin.

Daskalaki
Mr President, time is short and already a lot has been said about these matters. The Intergovernmental Conference raises particular questions, in general. Will Europe manage not to turn the allfamous convergence into a linchpin of diluting European unity and a foundation of Euroscepticism? Will it manage not to make millions of jobless the victims of the logic of numbers and international competition? Will it manage to maintain its social face? That is the first requisite. But many other challenges for the future are no less serious.
The European Union seems to have forgotten the dreams of its founding fathers. On the pretext of the imminent enlargement, an enlargement which is morally and practically necessary, planning some institutional changes which substantially undermine the European foundation and increase our democratic deficit. The lack of a common foreign policy and security policy will only accentuate domestic problems of insecurity and lead to questions about the famous Community solidarity, while in the international arena the European Union is often left weak and undependable. The united Europe of citizens and social justice, the Europe which offers equal opportunities and possibilities to women and men, the one which makes the most of its multicultural and multilingual character, with its dedication to peace and democratic values, that was the original dream. If all of these reforms really come about we have no right to sacrifice that Europe on the altar of a technocratic operation of doubtful effectiveness.

President
I have received eight motions for resolutions pursuant to Rule 37(2).

Patijn
Mr President, while we are still in the final phase of the negotiations, I find it rather difficult to start discussing whether expectations are too high or too low. What will the results be? Will they turn out well or badly? This is no good. That is no good. That could be better. I would actually prefer to put the whole issue of the results to one side and make one or two political comments instead.
First of all, Mrs Green compared me with Commissioner Oreja, and said that while I had given an optimistic version of events, Commissioner Oreja was more realistic. I would point out that I was giving a report on the informal Council meeting in Noordwijk, and if I was optimistic I was simply reflecting the mood of the Heads of Government at the meeting. If they make optimistic noises, then it is my duty as their humble servant to pass these on faithfully to the European Parliament.
Mrs Green also said that our agreements cannot be worth much because they have been reached too quickly. I think it is a pity that Mrs Green should talk like this, because the fact is that one of the reasons we have been able to reach agreement is because of the new government which the United Kingdom has had since 1 May, and a number of issues that were matters of dispute for the previous government are now no longer so. Let me just run through a few of these.
There is the agreement that human rights principles should be clearly taken into consideration in the Council's political actions and in the Court of Justice's judicial practice, and the acceptance of the anti-discrimination clause. The employment chapter is no longer really in dispute. Of course, one can always argue about the finer details, but it is mainly thanks to the agreement of the new British Government that it is no longer a controversial issue. The incorporation of the social protocol in the Treaty and even the upgrading of its terms and scope are also no longer controversial, again partly thanks to the British Government. It is also now cooperating on the inclusion of the principle of openness and transparency in the Treaty, consolidating the legislative role of the European Parliament by extending codecision, a successful agreement on the jurisdiction of the Court of Justice under the third pillar, and a successful agreement on stronger anti-fraud legislation, which may even be improved further still once we have discussed certain amendments from the British Government. So when Mrs Green says that this does not amount to much and that it is all uncontroversial stuff, I have to tell her that it is thanks to her party and her Head of Government in London that so many of these issues are no longer in dispute.
Let me be quite frank about this. In my opinion, there are really not many issues left on which the Amsterdam Treaty could come unstuck. But the one subject that is likely to cause real problems is the free movement of persons, the communitization of asylum, visa and immigration policy and the application of Community rules and procedures in this context, including the role of the European Parliament, codecision and the jurisdiction of the Court of Justice. If there is no agreement on this, it is because the British Government, whose cooperation we have welcomed on all the issues I just mentioned, simply cannot throw off the shadow of Mrs Thatcher and agree to regulate these matters in the treaty. It has not given any indication that it finds the presidency's approach acceptable in principle, or that it would consider amendments to take account of the special circumstances of island states or even to recognize the fact that the United Kingdom has a different tradition from the continental states when it comes to identity checks in its own country and at its borders. Yet we need the British Government's cooperation on the free movement of persons if a treaty is to be agreed at Amsterdam. Without it, I fear the worst.
Next, job creation. For the presidency and the IGC, this is not just a question of having an employment chapter. Job creation requires 100 % joint effort from all the organs of the European Union in every area: the operation of the internal market, a liberal trade policy, effective flanking measures in the social field and on cohesion and the Structural Funds, an effective transport policy, and help in establishing trans-European infrastructure. These are all elements that have a role to play. If we wish to create the right conditions in Europe for the market and the private sector to act as the driving force in generating employment, it is absolutely vital that the impetus and drive should come from every single policy sector, and this is actually what the aim of the employment chapter is. It is not simply a vertical process of creating jobs, it is all about creating a horizontal approach to the whole question of our competitive position, competitiveness, economic renewal, broader economic cooperation between Member States and creating the conditions for business to achieve its aims of economic growth and job creation.
If there is a second issue which concerns me at the IGC, and here I will take up what Mr Brok said, it is whether the Conference will be able to prepare the European Union for the 21st century, and in particular enlargement. As an inside observer, I have to say that I am somewhat concerned about this point. Institutional reform - in the Commission, in majority decision-making and in the simplification of procedures - will require greater efforts from the Conference. We shall have to go the extra mile for it. This means that the representatives at the negotiating table will always have to bear in mind, as Mr Brok said, that they are preparing for the 21st century and enlargement. We could quite easily carry on discussing until well into the 21st century whether each Member State should have its own Commissioner, but at a certain point, the talking has to stop and the institutions and procedures involved will have to be changed, and we need some indication of how this is to happen at Amsterdam, or even earlier.
My third point is the issue that was raised by Mr Brinkhorst and Mr Wiebenga, fellow countrymen and soulmates. They are concerned about the quality of the constitutional state, as indeed we are, and this is why the Member States and the presidency in particular have insisted that the Treaty should say that the Union is a Union of democratic states determined to maintain the rule of law at a high qualitative level. This means that we will do our best to provide stronger legal protection for the weak, for people who suffer wrong, for people who are discriminated against on grounds of nationality, and so on. But we must be sure we are not throwing out the baby with the bathwater. Mr Brinkhorst mentioned Article H, which is indeed something of a mess. It is a question of how many of the 200 000 asylum cases handled by the courts in Europe are likely to be referred to the Court of Justice in Luxembourg, which currently handles 200 cases a year, each taking on average two years. If we assume that a certain percentage of those 200 000 cases will come to the Court of Justice for a preliminary ruling, what this means is that the judicial process will be totally disrupted, because the cases will take far too long and the national asylum authorities will have to wait perhaps two, three or four years before they know the correct legal position for handing down their own judgments, which in turn will mean that asylum cases in the Member States will also grind to a halt. We have to take account of what can realistically be achieved, and this is why I do not feel directly concerned by the criticism which has been voiced about these kinds of issues. When it comes to the quality of the constitutional state and legal protection, I am convinced that the presidency and the IGC will make significant progress as regards the position of the Court of Justice on matters currently under the third pillar. I would also point out that there is almost complete agreement in the IGC that the European Parliament should have full rights of consultation on intergovernmental matters under the third pillar, whereas at present it has none.
I occasionally had the impression during the debate that we were not talking about the same treaty, but I suppose this is understandable, since we are of course looking at things from different political perspectives. I would assure the House that when the treaty is ready for signature by the Heads of Government, its substance, details and coherence will have been subject to the most rigorous scrutiny. The presidency continues to support the proposals it has put forward, and we are delighted that most of them - and I have told you about one exception to this - have met with approval. The presidency will be doing everything it can, with the support of the European Parliament and the cooperation of President Santer and Commissioner Oreja, to try to prevent the outcome from being adversely affected in the final weeks of negotiation.
Mr President, I shall stop there. I should like to thank you most sincerely for the time I have been able to spend with you.

Oreja Aguirre
Mr President, ladies and gentlemen, following the speeches we have heard this afternoon, including the one we have just heard from the President-in-Office of the Council, I should like to tell you first of all that this debate has come at a very good moment. We are now in the run-up to the final negotiations and the final ministerial meetings were held on 20 May, and the European Council on 23 May, and at this moment in time we are constantly in negotiations. Consequently, this debate has been extremely enriching for me. I have heard from the different political groups what their concerns are. Resolutions have been presented and tomorrow will be put to the vote, and for us they will be a very important reference. You can rest assured that the Commission is going to examine the resolutions approved by the European Parliament with all due care.
I should also like to say that, when I spoke, I did not intend to be either optimistic or pessimistic. I just told you how I see the situation at the moment but, above all, I wanted to draw your attention towards the risks that also exist. I think that the Presidency has played an important role throughout the recent months, but I should like to point out that, right now, we are on one of those levels from which it would be extremely dangerous to come down. That is what I wanted to draw your attention to. Not because the Presidency's document concerns me. What would concern me is if the level of the document presented by the Presidency were to be lowered.
As for the speeches we have heard, I would like to begin with Mrs Green's, in which she referred to the Presidency of the Council and I would like to point out the importance of some of the chapters which Mrs Green mentioned, in particular the fight against discrimination. It is one of those subjects which has been dealt with in depth in recent weeks and I think that it is one of those subjects on which a satisfactory solution could be reached.
Mr Brok referred to the fact that Europe must serve its citizens and he referred to an article which seems to me to be extremely important, namely Article 113. I also refer to it and there is an intention to submit it to qualified majority, as well as services and intellectual property. This question was not provided for in the Treaty because no problem of this type faced Europe in 1957. In 1957, problems affected goods not services. But today what is the main aim of trade? Mainly services and intellectual property. As a consequence, it would make no sense to distinguish between goods and services and intellectual property. Therefore, we must unite to improve the defence of the interests of companies, citizens, Europeans, and therefore I think that it is essential - yet we have not done this so far. Mr Brok said that, perhaps, we should think about a protocol with exceptions and that is undoubtedly a very good approach: there should be a general rule with some exceptions, included in a protocol appended to the Treaty.
Mr Azzolini mentioned that Europe needs a political dimension, and that is a dimension which we really must find. Mr Brinkhorst referred in particular to the subject of codecision and referred to one article, which shows that he is very knowledgeable about the subject which we are dealing with at the moment, namely Article H. It is precisely that which, in its current version, would prevent any presentation by the Court of Justice of appeals which would prejudice matters affecting the third pillar. That really would be very dangerous, because it would mean cutting off a possibility which those courts have and, if at least that possibility were left to the Supreme Court, that would be a guarantee for citizens and would give the Court of Justice a more important function.
Mr Puerta referred to a code of confidence which is a central matter. What we really need to do is gain confidence. Someone else referred to the idea of a pact with the citizens, and that is a phrase that I like and I am particularly sensitive to it. I think that is something we have to aim for and I think that that will also be the result of Amsterdam, in other words that we will achieve a pact with the citizens because it is the citizens who must be at the centre of the Treaty. I would also like to tell Mrs Roth - who referred to the role of the European Parliament - that the Conference is aware of that and I hope that the number of decisions will be reduced and I also think that we will make progress towards codecision. As a consequence, I understand very well - as Mrs Roth said - that you will obviously have to put forward your requirements and insist on them and I hope that they will be accepted in the resolutions and I think that they will be on the negotiating table of the Conference. As Mr dell'Alba said, there has been a unanimous decision in this forum, and that is a very important fact. This is a fact which the Conference cannot ignore, which the States cannot ignore. There is unanimity and a very solid position in many areas and I think that this is something that we will take into account, in particular.
Other speakers insisted on strengthening the European Parliament's powers and also referred to the fight against crime, the rejection of its 'communitarization' - it is not being 'communitarized' but greater powers are being given - and Mr Miranda spoke of the role of national parliaments. I should like to tell him that there is a formula, which is being accepted now, for the role to be played in the future by national parliaments. I think it is very important - and this is something mentioned by another speaker - that the European Parliament should give an opinion on modifications to the Treaty. This is a claim which the European Parliament has always made and which is now present before us and which I think is extremely important. It is very difficult to explain to the public, to the ordinary people, that the European Parliament could not give an opinion on modifications to be introduced into the European Constitutional Charter. You know that this is a claim which has the full support of the Commission.
I did detect a rather excessively pessimistic tone in some of the speeches. I should like to say that we still have a lot of room for manoeuvre and the European Parliament must play an extremely important role as it represents national sovereignties and European sovereignty. It is extremely important to know what its desires and aspirations are, and that will be recognised in the resolutions as I said, and your opinions will be taken into account at the negotiating table, both by the Commission and the Intergovernmental Conference. I hope, finally, that these uncertainties mean that we really are bent on creating a fairer, freer and more supportive Europe.

President
Thank you very much, Mr Oreja.
The debate is closed.
The vote will take place tomorrow, Thursday, at 11 a.m.

Excessive deficits and economic policies (continuation)
President
The next item is the continuation of the joint debate on the report (A4-0181/97) by Mr Christodoulou, on the recommendation for second reading (A4-0172/97 by Mr Christodoulou, and on the report (A4-0184/97) by Mrs Randzio-Plath, on behalf of the Committee on Monetary and Economic Affairs and Industrial policy, on excessive deficits and economic policies.

Theonas
Mr President, I only have one minute to speak but I should like to thank Mr Christodoulou and Mrs Randzio-Plath for their proposals concerning upgrading the role of public investment in a period in which untrammelled profit-making and obsession with the market characterise the European Union's economic and social policies.
Mr Christodoulou's amendments go in a positive direction compared with the Council's position and that is why we are supporting them. The same can be said for some of the ideas outlined by Mrs Randzio-Plath. However, the attempts by the rapporteurs to make the notorious Stability Pact acceptable are not enough and the same is true of the general directions taken by the economic policy of the European Union. The very serious problems of development, the drop in productive investment, rocketing unemployment, widespread poverty and the complete paralysis of Europe's social protection system will go on growing. The marginalization of countries and economies and worse labour relations will be the immediate effect of the policy now being pursued by the European Union.
It is clear, Mr President, that this social and economic model is completely contrary to workers' interests, and that is why we shall fight to overturn it. We shall step up this fight however we can.

Wolf
Mr President, ladies and gentlemen, it is right that we should deal jointly with the stability pact and the broad economic policy guidelines. Already last year, the House was advocating a policy mix as a means of moving beyond the obsession with stability. At this very moment, Lionel Jospin is in the process of winning an election in France on a platform which includes the demand that European stability policy should be integrated into an economic regime. It is also high time, I believe, that the Commission abandoned its blind belief in neo-liberalism and, instead of accepting a downward spiral of competitive deflation and fiscal dumping, changed course to return to and build on the ideas of Brüning, to create a situation and a policy that would take us beyond Keynes.
Mr Christodoulou, with his banker's intuition, rightly saw the error of the view expressed by one Member who said - not today, but in relation to these decisions - that even symbolic texts merited recognition. To recognize texts that were merely symbolic would be to destroy our credibility, and credibility cannot be earned through the kind of automatic, mechanistic approach that amounts to policy by numbers. It cannot be earned by strangling investment in the name of saving. I should also like to mention another aspect which is dear to Mr Christodoulou, and that is territorial integrity. It should be dear to us too, in the light of the increasingly bitter social divisions in our countries.
Anyone attempting to build on a stability policy that is not rooted in consolidation of the economy, socioenvironmental development and genuine economic convergence, and which does not serve the ultimate goal of implementing Chapter 10 of the Delors White Paper, must be prepared to face opposition. They must be prepared to be sent packing: and, as we have heard today, there are people ready and willing to do just that.

Blokland
Mr President, the stability pact needs to put the lid on any possibility of an over-flexible budgetary policy. Why? Primarily because the no-bail-out clause in the Treaty is going to be a paper tiger in practice.
The European Union is clearly going to be taking a serious risk if it follows the timetable for EMU in the Treaty. Various Member States are currently performing gymnastics with their accounts in order to meet the EMU criteria, but this has absolutely nothing to do with genuine convergence, as we shall see once EMU is a reality. If there is an economic recession around 1999, many of the EMU states will go into the red, and they will do anything they can to avoid sanctions.
As it currently stands, the Council regulation allows for the possibility of manipulating reductions in gross domestic product, and Mrs Peijs and I have tabled two technical amendments on this point. The Council must define in more detail the method to be used for calculating the reduction in GDP, so as to exclude deflationary creative accounting.
It is not a good sign that the Commission failed to do anything about this when it was pointed out by statisticians after Noordwijk. Indeed, the way in which this regulation has been handled so far hardly inspires one with confidence. Could I urge the Commissioner to pay more attention to building confidence in future? Eurosceptics cannot be expected to believe sales patter for the euro and EMU, and I have yet to meet a Dutchman, German or Belgian who would be prepared to trade in his currency for a soft euro.

Lukas
Mr President, the stability pact throws up a whole series of unresolved questions, ranging from the moral aspects of economic policy to institutional considerations. Given the need for budgetary discipline, we should support the automatic and systematic imposition of penalties in the form of non-interest-bearing deposits, and their subsequent conversion into fines. Too great a degree of flexibility here would open the way to all kinds of excuses, and that is not what we are seeking. However, what we must reject entirely is the plan to distribute sums received from a Member State which is in breach of the budgetary rules amongst those which do not have excessive deficits and which participated in the decision to impose the fine.
Such a procedure would almost smack of sharing out the spoils. Instead of aggravating a country's already difficult situation, we ought to seek ways of helping it to overcome its problems, and that should also be the thinking behind the imposition of a penalty deposit.
If monetary union is to become a reality, lasting stability is absolutely essential. But sanctions imposed by the Council would have no bite without some means of enforcement - and that would mean at least the possibility of bringing an action before the Court of Justice. On the other hand, if such measures were to go significantly beyond the coordination of economic policies which is provided for in Article 103, this would require an amendment to the Treaty, with all that such a step involves.
It is hard to envisage achieving a stable monetary union without, at the same time, institutionalizing cooperation and coordination. Anyone who supports monetary union must also support the creation of the conditions for achieving and maintaining it. But this will require a new, interventionist element in economic and budgetary policy, an element that will involve amending primary legislation and will therefore, under the terms of Article N, have to be dealt with by the national parliaments.

van Velzen, Wim
Mr President, as in the first round of discussions, I would criticize the calls from the Commission and now also the Council to promote regional differences in wages within the Union. I have to say that I completely fail to understand why the Commission wants this, and what its purpose is in calling for it. I can well imagine that Germany's problems after unification have left an impression, but I think it is going much too far to extrapolate these problems into a general European policy. And I find it particularly unacceptable since there is no mention in the proposals of any framework for doing this. Even in the discussion last time, the Commission failed to indicate which policy this was meant to be part of.
The matter is all the more serious given that we know that after EMU we can expect that competition between the Member States, which is often much greater than people realize, will be focused on social security and wages. I can only assume that the Commission actually thinks that such competition should now also be encouraged between regions within Member States once EMU is in place. I should be extremely grateful if the Commission could explain what the thinking is behind this, and what policy it is pursuing.
As you know, business relocations in the Union are becoming increasingly common, more so within the Union than to other countries, and many of these are associated with competition or dumping. Hoover moved to England because that particular area had its back to the wall and accepted below-normal wages and much poorer social conditions than in the rest of the country. It accepted this because it could see no other option, and it all formed part of the 'level playing field' policy. Such a framework is completely absent from the Commission's present approach, and Parliament has no choice but to oppose it as it stands.

Ilaskivi
Mr President, our colleague Mr Christodoulou has drawn up a very interesting report on economic policy, most of which can readily be endorsed. However, there is one detail which requires closer examination.
The report stresses strict adherence to the 3 % limit for budget deficits. Firstly, the 3 % figure beyond which strict penalty interest becomes payable has been selected arbitrarily. It could just as well be 4 %, 2 1/2 % or even zero. A certain flexibility is therefore called for.
Secondly, after the third stage of EMU, national economic policy-makers will have their hands tied. It will no longer be possible to use exchange rate adjustments between euro currencies. The European Central Bank will dictate monetary policy. The only remaining weapon will be budgetary policy, which it should be possible to use, especially in countries with low rates of public indebtedness, to fund investment which would generate employment. For this reason I tabled an amendment in the Economic Affairs Committee, but it was rejected. It read as follows: 'Urges the Council and Commission to monitor closely the development of the various Member States' budget deficits with the aim of making it possible, in order to tackle exceptional economic problems and serious mass unemployment, to waive the 3 % deficit limit provided that the deficit does not exceed this objective throughout an economic cycle.'
Since similar matters will be considered later in the Fourçans report, certain of my amendments to which have been adopted, I support Mr Christodoulou's ideas. Although the unemployment rate is not among the convergence criteria, employment policy ought to be a central concern to us Members of Parliament.

Gasòliba i Böhm
Mr President, ladies and gentlemen, our group agrees with the basic analysis presented by the Commission on the major thrust of the policies of the Member States and the Community as a whole, which is the subject to which I shall be referring implicitly.
We think that we have to deepen some aspects. The completion of Economic and Monetary Union and the introduction of a single currency mean that we need an authentic European Union economic and monetary policy. The Commission has shown itself to be over reluctant and in its next proposals it will have to offer us some guidelines for a genuine European economic and monetary policy to accompnay EMU and the single currency.
We also want to draw special attention to the need for creating favourable conditions for a more competitive productive system but we do not agree with the means proposed by Mrs Randzio-Plath. We do not think that the right way to do this is stepping up public investment or intervention in the public sector - which would only lead to undesirably higher deficits which would make EMU impossible - or by discriminating in favour of public investment as if that would lead to an improved productive system that would be competitive internationally and create more jobs.
On the contrary, we believe that we should head for a more open and more competitive framework, with a system which promotes private initiative, private investment and entrepreneurial initiatives. This is the way to create jobs and achieve greater economic progress.

Katiforis
Mr President, it is a shame that the general guidelines on the economy constitute a breach of duty. It is the duty of the Council to admit the failure of a policy when that failure has occurred. The European Union's employment policy, explained most extensively in the White Paper on competitiveness, productiveness and employment, has been an utter failure.
We were meant to have reduced unemployment to about half of the levels of 1995 by the year 2000. The year 2000 is nearly upon us and unemployment has not come down nor is it likely to reduce. The least we could have expected to be done as a result of the new guidelines would have been to sound an alarm signal and admit failure. Instead of that, all that has happened is they have again trotted out an apology for an excessively restrictive policy, which this Stability Pact is most likely to perpetuate.
Obviously, we have reached a point when we have to get out of this dialogue of the deaf, Mr President. But when officials lose their hearing, democracy loses its dignity. Already one prime minister has fallen after losing his hearing and others will do so in turn, Commissioner, and then perhaps we shall reach understanding as simple citizens and not as officials.

Ettl
Mr President, following what the Commissioner has said today, I really must make the point once again that we have more than 20 million people out of work in Europe, with one in five young people unemployed and unable to find work, and I have to say that the Commission's recommendation for the broad economic policy guidelines can only be described as toothless. It offers no real prospects for working people in Europe. It is for that reason, and in order to focus attention once again on the employment issue, that the trade unions in Europe have called today's day of action. It is a protest and a warning which we, as parliamentarians, must take very seriously indeed if we wish to ensure social stability and social peace.
Not without reason, the trade unions are looking to Amsterdam to make good the shortcomings of Maastricht. A virtually exclusive focus on monetary value, stability and consolidation is too narrow. If we fail to persuade the Council to make an active employment policy part of the broad guidelines for economic policy, and if we fail to create a policy mix under Article 3 so that we achieve the type of growth that generates jobs, the consequences will be a setback for Europe and a risk of conflict.
I welcome the clear line taken by the rapporteur on this question and her call for the guidelines to be more binding - something that the Commission was obviously unable to insist upon.

Torres Marques
Mr President, the Commissioner, Mr de Silguy ended his speech today saying that jobs would not be created by decree. I should like to remind him, on the other hand, that unemployment can be created by decree and that is what we, in the Socialist Group, want to avoid.
The Stability Pact was not foreseen in the Maastricht Treaty nor was it necessary in our opinion. What was written there already wisely decided how the economic situation of countries joining the single currency would have to evolve. For this Pact, which has no legal base, to be politically more acceptable the Council has added to the title the word 'Growth' without actually changing the content of the document.
What we are now demanding is that the proposals put forward and which have been translated in the Christodoulou and Randzio-Plath reports, as well as greater emphasis on employment, should be accepted. The Stability Pact proposes sanctions and automatic fines which we regard as unacceptable.
The institutionalization of a process of inter-institutional decision making, as proposed by Mrs Randzio-Plath, and integrating the Council, Commission and the European Parliament, will give the citizens of Europe the guarantee that rigour will be allied with growth and job-creation.

de Silguy
Mr President, I shall try to answer all of the questions put to me during this debate, in two parts. I shall take the questions in order and I would ask members of the European Parliament to excuse me if, in the time allotted to me, I do not manage to answer with precision all of the questions put to me.
Mrs Randzio-Plath, - and here I am also answering Mr Ettl - the Commission has already taken up, in its proposal on the guidelines, much of your resolution on the annual economic report. I remind you that we have, at your request, proceeded to informal consultations before even presenting our proposal. Now the main guidelines have been defined and the recommendation is there on the table. The debate now is in the Council, I would say. And I think it is more operational and effective to go in the direction recommended by the Parliament and to support the advances made by the Commission in its recommendations in order not to run the risk, as we did last year, of seeing the Council adopt a more restrictive stance than you would want.
Mr Christodoulou, I am going to reply to the problem of Amendment 4(2) which you have raised. I can tell you that, having looked at it again and thought further about it, during the suspension of the sitting, the Commission still cannot take on board this part of Amendment 4, as it is a subjective assessment which does not belong in a regulatory text. Furthermore, I would say that the notion is already contained in the wording of Recital 10. Finally, Mr Christodoulou, the expression 'inopportune pressure' seems to be unnecessarily provocative and I am astonished that a former eminent governor of a central bank should give in to such temptation.
Mr Donnelly, first of all I would like to tell you that it seems to me that the Commission has done all it could to involve the European Parliament in the preparation of the Stability and Growth Pact. I have worked it out: this is the sixth time since the month of February that I have come before the European Parliament or one of your committees. And I would add that, as far as the trilogue is concerned, the fact that it met at all is thanks to the Commission's action. I would also add that the amendments accepted by the Commission, following the European Parliament's first reading, have been taken up by the Commission and accepted by the Council. Therefore, I do not see why the same should not be true of the second reading.
Allow me, Mr Donnelly, to tell you that I do not share your feeling about the deflationary effect of the Stability and Growth Programme. The budgetary consolidation, under way, favours what in economic jargon is called 'crowding in' of investment. Investment in equipment will increase by 4.8 % in 1997 and 6.3 % in 1998. I should remind you that a 6 to 7 % investment growth per annum should make it possible to sustain medium-term growth of 3 to 3.5 %, which should create jobs at a rate of 1 to 1.5 %.
The Stability and Growth Pact does make it possible to recover the room for manoeuvre which did not exist, and to avoid the monetary policy from becoming overburdened, which would lead to an obviously overly restrictive policy mix. I would add that the Stability Pact does allow budgetary flexibility in that, when structural budgets are balanced, during slow-down periods, it will be possible to play with all automatic stabilisers. I have just given an economics lesson but in simple terms it is a question of knowing how to finance investment, be it public or private, when today, with the level of deficits that we still have, more than half of household savings are absorbed by debt repayment. Yes, we are in favour of financing investment but we are also in favour of reducing public deficits which would make it possible to use that money to finance investments rather than finance state debts.
I can assure you, Mr Donnelly, that the Commission is taking its responsibilities. It took them when it presented the Green Paper. It also took them when it presented regulations on the Pact on Stability and Growth. It also took them when it presented its regulations on the legal status. And it also took them in the interinstitutional dialogue in order to make sure that the European Parliament's view was heard as much as it could.
Mr von Wogau, the golden rule for public investment, which you mentioned earlier, will be achieved in 1998. Judging by our predictions, public deficits, if the policy is unchanged, will be 2.5 % in 1998 and public investment growth will be between 2.5 and 2.8 %. I think I replied to your other three points in my introductory speech.
Mr Giansily, I agree with your analysis on the stability and growth policy. I would say to Mr Cox that I also share his analysis, which is more or less the same as Mr von Wogau's. Concerning the fines, I think that I replied to your question in my introductory remarks, and the same is true of Mr Lukas.
Mr Wolf, I think that the policy mix makes it possible to overcome what you call this 'stability fetichism' . Once again a relaxed policy mix is favourable to growth and employment because it makes it possible to relax the monetary conditions. In a relaxed policy mix, there is no conflict between the objective of stability and budgetary and wage development. There is now a trend towards such a policy mix. As for 'economic government' - I do not have 'word fetichism' - call it what you like! What does it matter whether a cat is grey or black as long as it catches mice? - I think that what is important for us today, Mr Wolf, is that we are able to implement what we have set up. We have set up instruments for economic coordination. It is now for the policies to add a practical content to this and to implement what we have put into place.
Mr Blokland, on the important point that you raised, concerning what you call accounting 'somersaults' , I would like to tell you that there are a certain number of rules. We are not governed by the law of the jungle here. Rules are the European system of national accounts, the SEC, SEC 79 to be exact, as well as a Directive on GDP. These instruments properly define GDP and there is nothing to add to the Stability and Growth Pact on that score. The Commission is currently backing all of the efforts by statisticians who are trying to improve GDP calculations. This is a very important job. But I do not think it is the place, in a debate on the Stability Pact, to refer to these findings. You also say that the public are not going to believe in the euro. I disagree and reassure you that the public do believe in the euro - at least, according to the opinion polls which we regularly hold.
Mr van Velzem, you referred to the very interesting problem of the regional differentiation of salaries. I think that it is a normal economic mechanism which is contested by no economist. The best proof is that if regional differentiation of salaries did not take place, there would be major regional unemployment. I am thinking in particular of the Mezzogiorno. It is probably no fluke that Italian trade unions recently acknowledged regional differentiation and accepted it.
Mr Ilaskivi, you wanted to know why the figure of 3 % was chosen. There are several explanations for this. One which comes to mind is that when there is nominal growth of 5 %, 3 % real growth, 2 % inflation, in order to maintain a 60 % GDP debt rate, the public deficit must be no greater than 3 %. But the figure is unimportant. I personally think that a 3 % public deficit is very high. In many of our Member States that means that the state spends 20 % more than it earns every year. I would challenge any company, big or small, to survive if it spent 20 % more than it earned.
Mr Ilaskivi, you also refer to the problem of adjustment in the case of asymmetrical shocks. You know that the asymmetrical shocks of the last 25 years have been greatly amplified by divergent policies. That will no longer be possible if we have EMU. At cruising speed, budgetary stabilizers, political stabilizers and wage adjustment will be enough.
Mr Gasoliba i Böhm, I cannot fully agree with your claim that growth should not be stimulated through public investment and I am not sure that that will please Mrs Randzio-Plath very much. I think that public investment has to be maintained and I think that we have to have the major networks. As I demonstrated earlier, in my introductory statement, the future of coming generations, the future of our countries, relies in certain cases on major public investment that only States could afford and to which in any case they would have to contribute. That said, the Commission recognizes that public investment has suffered in recent years and that is why it can only deplore the fact that the Council has rejected its proposals concerning the major networks.
I think that I have answered nearly all of your questions. Allow me, in conclusion - and there I will be answering some of the concerns which have been raised, in particular at the end by Mrs Torres Marques, Mr Ettl or Mr Katiforis - first of all to say that the Stability and Growth Pact is nothing more or less than the Maastricht Treaty. The Commission has been particularly concerned, during the negotiations, to make sure that nothing is added to what was already foreseen in the Treaty. The Stability and Growth Pact brings together two regulations, one based on Article 3.5 and the other on Article 104, which are aimed at making the Treaty provisions operational and quite simply establishing the rules of procedure for the euro.
I shall conclude by saying that the real problem today is that of unemployment. We are perfectly aware of that. But we cannot believe that it is possible to create jobs out of thin air. We are not going to create jobs, including jobs for the young, unless we give European once again the conditions for healthy and sustainable economic growth. For some years now, thanks to the strategy pursued we have gradually re-established that framework. Now we must pursue that effort, and we must crown our success with the introduction of the euro. The single currency will definitely provide that framework for stability and growth - words which are not mutually exclusive - and we must also be very much aware of the fact that we have to shoulder our responsibilities vis-à-vis structural unemployment. That calls for structural measures, namely research, education, training - and I think, in particular, that it is very important to lower the tax burdens imposed on labour-intensive industries.

President
Thank you, Mr de Silguy.
Mr Christodoulou has asked for the floor to make a brief comment.

Christodoulou
Mr President, I should like to tell the Commissioner that the Greek text referring to that amendment, which I had asked him to accept, uses the expression 'unjustifiable pressures' , on the exchange market. I am sure that any governor of any central bank, whether eminent or not, would use such a phrase quite often. The meaning of the phrase 'unjustifiable pressures' in the exchange market is extremely well-known and it is used quite frequently.
I should also like to tell the Commissioner that the reason why we ask for certain amendments was that we wanted to facilitate implementation of the Stability Pact. The Stability Pact, as it stands, is so inflexible that its implementation, in my view and many others who have studied it - and they are practitioners in contact with the markets - we believe that it is not very easy to implement. What we tried to do, therefore, was to table certain amendments which would make it easier to implement the Pact and which would make life easier for the Commission. But they have not been accepted. I hope therefore that, tomorrow, the European Parliament will vote for the Pact so that we can try and make progress, given that it really must be accepted, even in this form.
However, the Commissioner must remember, when we meet again some time in the future, that there is no way in which the Stability Pact as it stands at the moment can really be implemented. It has no political base and, therefore, it seems very difficult for it to be implemented and, as we learned from the financial, monetary and other developments of the early 1990s, in particular 1990-1991, when we have no flexibility, the result is a catastrophe. It seems that this lesson has not been learnt by most of those who have presented us with this text and, as a result, we have something which is inflexible and very difficult to implement. I hope I am wrong. But I am afraid that I am right.

Randzio-Plath
Mr President, I should like to say to the Commissioner once again how much the House naturally appreciates the fact that informal dialogue has been possible with the Commission on issues including the broad economic policy guidelines. It would be good to see the Commission supporting the concept of negotiations with Parliament. Both the Monetary Committee and the ECOFIN Council have already indicated that they are prepared to give the idea their backing. It would mean that it should be possible to include some form of negotiation with Parliament in the process of reporting on and drafting the guidelines, because there is no doubt that, even without specific provision in the Treaty for trialogue instruments, it is still possible for the three institutions to agree on essential policy guidelines, in the interests of tackling mass unemployment effectively. It would be helpful if you too were prepared to support this idea, Commissioner. In conclusion, I should be grateful to our President if he could ensure that the decisions which we take tomorrow, on matters including the broad economic policy guidelines, are conveyed as quickly as possible to both the Monetary Committee and the Dutch presidency, so that there is enough time for the issue to be referred to and discussed at a dialogue or trialogue meeting.

de Silguy
Mr President, very quickly I wish to thank Mr Christodoulou and Mrs Randzio-Plath for the excellent cooperation and the work carried out together on these two extremely important documents. I hope, while warmly thanking Mr Christodoulou for his efforts, that he will also understand that we have taken on board and had accepted by the Council as many of the amendments as it was possible to have accepted. I now think that the compromise on the table is a balanced one and that that should be recognised legally. I also think, Mr Christodoulou, that it is sufficiently supple. I recall that, nonetheless, at the basis of the Stability Pact lie the Commission's proposal and initiative and the entire capacity of the Council's decision-making. There is also a framework. It is now for the politicians to bring it into life.
Thank you, Mrs Randzio-Plath, for your remarks. I am still open to suggestion and to see in fact how it is possible to involve the European Parliament even more in work on the main guidelines of economic policy. I think that we have made a breakthrough this year. I think also, when debating the annual economic report, one of your colleagues, Mr Donnelly, made some proposals to improve the procedure. We are thinking about that. I shall do so in a constructive spirit, because I think that strengthening dialogue, with greater transparency, is a vital condition now in Europe if we are to have our economic policies accepted by our fellow citizens.

President
Thank you, Commissioner.
The joint debate is closed.
The vote will take place tomorrow at 11 a.m.

EU tax systems
President
The next item is the report (A4-0169/97) by Mr Secchi, on behalf of the Committee on Economic and Monetary Affairs and Industrial Policy, on the report from the Commission on taxation in the European Union: report on the development of tax systems (COM(96)0546 - C4-0054/97).

Secchi
Mr President, ladies and gentlemen, it is a great pleasure for me to present this report on a topic which I regard as extremely important.
I should like to say first of all how glad I am that the European Parliament is debating EU tax policy and the development of national taxation systems just two weeks or so before the Amsterdam European Council, since this allows the people's representatives to express their authoritative opinion on a topic which should receive maximum attention on that occasion and, hopefully, be the subject of innovative decisions giving fresh impetus to a policy area which has been stagnating for far too long.
The Amsterdam European Council will in fact be addressing itself to the action plan for the single market, the purpose of which is to establish the timing and mechanisms for all the measures needed to complete a real single market sufficiently in advance of the transition to monetary union, and before the launch of negotiations on further EU enlargement. Naturally, the House endorses this objective and hopes that the results achieved at Amsterdam will live up to the expectations of Europe's citizens and economic operators.
Fiscal matters are particularly important in this context, in that without better coordination and harmonization in all the areas that are crucial to the smooth functioning of the single market, not only will this market be quite incapable of operating satisfactorily, but the success of monetary union will be jeopardized at the same time. This does not in any way mean denying the role of subsidiarity in fiscal matters: serious thought must be devoted to preventing the application of this principle from conflicting with the basic reasons for which it was quite rightly incorporated in the Treaties.
The Commission's studies and analyses, which were welcomed and examined carefully by Parliament, reveal on the one hand that the situation has gradually degenerated into one of damaging tax competition and, on the other, that a fresh approach is needed, without prejudice to the ultimate objective of abandoning the principle of unanimity for Council decisions in this area, as called for on many occasions by this House. In particular, excessive fiscal competition has had - and is continuing to have - adverse effects on the smooth functioning of the internal market, because of the distortions affecting flows of goods, services, capital and business activity; on levels of employment, because of the increased tax burden on the labour factor, as against a substantial reduction of the burden on income from capital; and, finally, on the development of the Member States' tax bases, because of heightened fiscal competition, the net result of which - given the growing international mobility of economic flows and of certain other factors - is to aggravate the situation.
The analysis of existing taxation systems in the EU has thus revealed that, as a result of the gradual process of completing the single market, no individual Member State is capable nowadays of abolishing all by itself the remaining fiscal barriers hampering the free movement of goods, persons, services and capital, nor is it capable of combating fiscal erosion. Moreover, in the context of monetary union, where monetary policy will be supranational, independent and targeted at price stability, it will be necessary, in terms of fiscal policy, to reconcile the prerequisites for the smooth functioning of Europe's system of production and its single market with the need for the Member States to maintain a degree of control over fiscal policy in order to preserve income redistribution policies and, more generally speaking, the role of the welfare state. The room for manoeuvre here, even following the Growth and Stability Pact, is very limited indeed.
Consequently, the only viable solution is to bring tax policies in the sensitive fiscal areas outlined earlier within the auspices of the Community, thereby rectifying the prevailing 'excess of subsidiarity' , which is harmful both to our common interests and those of the Member States.
However, given that the Member States appear unwilling to change the unanimity rule, one temporary solution to the problem could be, for example, a voluntary restraint agreement in certain specific, clearly defined fiscal areas.
This is the purpose of the code of conduct laying down a set of common rules guaranteeing forms of coordination between national taxation systems: the Committee on Economic and Monetary Affairs is proposing to the House that certain specific elements for such a code should be drawn to the attention of the Commission and the Council. To save time, I shall refrain from reading out these elements. I hope, in conclusion, that the European Parliament will seize this opportunity to convey a clear and convincing opinion in what is a sensitive and complex field, but one which, unless further progress is made, will prevent us from achieving greater economic and social cohesion.

Monti
Mr President, let me say straight away that I am delighted to be here, today, to talk about tax policy: here, because I believe that the European Parliament can play an increasingly prominent and supportive role in this area, and Mr Secchi's report and comprehensive motion for a resolution inspire confidence that this House really can help us to move forward; and today, a day when the problem of unemployment in Europe is at the forefront of our minds, is a particularly appropriate time to discuss taxation. Indeed, the link between uncoordinated fiscal policies in the European Union and its serious unemployment situation is becoming increasingly apparent. And when we speak of economic management, tax policy - besides the monetary aspects - is undoubtedly a key element.
The highly divergent trends occurring in Europe as a result of asymmetrical fiscal competition are well known, and Mr Secchi has already referred to them: a fall in taxation on income from capital and a rise in tax on income from labour, the exact opposite of what would help to create employment. Once the single currency comes into being, the lack of coordinated taxation on capital income will become even more noticeable.
The Commission has discussed these issues, over the past year in particular, with the Member States and with Parliament. I would remind you of the establishment of the Fiscal Policy Group, which consists of the personal representatives of the Ministers of Finance. In fact, leaving aside the difficulties concerning unanimity, the reason why limited progress on fiscal matters has been made in the past is partly, in the Commission's view, that the various proposals were always considered in isolation. Therefore, in order to obtain their approval for decisions, it appears necessary to draw the attention of the Finance Ministers to the need for a more overall approach to taxation.
Alongside the Fiscal Policy Group, consisting of the Finance Ministers' personal representatives, the Commission has also been able to involve the European Parliament in its reflections - and I am very grateful to you for that. Within the Committee on Economic and Monetary Affairs and Industrial Policy in particular, we have explored fiscal matters on several occasions. I regard Mr Secchi's report in particular as a major contribution to our thinking and to the drawing-up of a fiscal action plan aimed at completing the single market and making it truly operational.
The deliberations which are taking place within both Parliament and the Council have enabled us to produce a blueprint which we hope will lead to tangible results. Several ideas contained in the Secchi report have in fact been incorporated into the draft action plan for the single market, adopted by the Commission. The elements currently under consideration in the single market action plan are: measures to guarantee proper taxation of cross-border capital flows; measures to abolish taxation in the form of deductions at source of interest payments and royalties between associated companies; a code of conduct designed to limit damaging fiscal competition which impinges on the Member States' tax-raising powers - the points for inclusion in the code, as listed in the Secchi report, will be a valuable contribution here; and measures to eliminate competitive distortions deriving from a lack of harmonization in indirect taxation systems.
We realize that it will not be easy to reach a consensus in the Council on all these proposals, but I am convinced that this approach should be pursued if we really do wish to make progress on tax policy. A coordinated approach is essential, and we shall carry it forward. The draft single market action plan also refers to the need to create a common VAT system and to review the Community rules on energy taxation.
Finally, another point on which I should like to comment, since it is covered in the resolution, is Community action to combat tax evasion and fraud. As we all know, international fraud and its perpetrators recognize neither national borders nor tax jurisdictions. It is therefore worth stressing the need to improve cooperation between the Member States and to step up our anti-fraud activities.
In order to give fresh impetus to these actions, the Commission has proposed an ambitious programme known as FISCALIS, which is intended to help the national administrations cooperate with one another by equipping them with the appropriate tools. Cooperation, which is already vital now, will become increasingly so with the new VAT system proposed by the Commission. FISCALIS will certainly improve the existing VAT systems right away; however, I fear that these improvements will not make up for the shortcomings in the present system. These gaps will only be filled by means of the radical overhaul of the system which we have proposed.
Thank you for having given me an opportunity to give you a brief overview of the development of EU tax systems. I assure you that I am very keen indeed to cooperate further with Parliament on this issue.

President
Thank you, Mr Monti.

Pomés Ruiz
Mr President, after Commissioner Monti's good words, approving the work by Mr Secchi on our task to make taxation an element for fostering the creation of jobs and wealth, I would like to emphasize and attach due importance to the fact that the Commission itself suggests that any proposal for Community intervention in taxation matters must be fully in keeping with the principle of subsidiarity.
It is obvious that taxation sovereignty is shared not only among the 15 Member States but that there are also States, such as Spain, with autonomous communities, such as Navarre, and others, which also have their own ability to decide on taxation policy without any interference with the internal market. Furthermore, as the Commissioner knows, once we enter stage three of EMU, the requisite not to exceed 3 % deficits vis-à-vis GDP will oblige all States and all taxation administrations to match spending and revenue. In other words, whereas administrations with the ability to spend are free to decide the level of expenditure, they must also have the freedom to decide what type of fiscal revenue they want and how to collect that revenue. I fully support the creation of a code of conduct avoiding malpractice in terms of taxation sovereignty but it is not for the European Parliament nor is it the right time to discuss whether the principle of subsidiarity should govern Community action, and we must base ourselves on the current respect for taxation powers. It is obvious that, in the future, we must think that only if intervention by the Community genuinely respects the subsidiarity principle can we achieve respectability and applicability of the measures emerging from the Commission and the Council.

Cardona
Mr President, everyone knows that social employment and budgetary policies are inextricably linked to taxation. Tax fraud and evasion, complex systems, no machinery for exchanging information, the increased tax burden on the labour market, the proliferation of 'offshore' areas and more favourable tax regimes and impediments to the circulation of capital as a consequence of different rules for determining taxable objects and tax rates, inter alia, royalties and savings, are all obviously factors which explain the phenomenon of taxation competition.
Effectively solving all of these problems is something demanded by all those, including myself, who think that the single market, which is both free and fair, also requires fiscal systems that are fair, balanced and neutral. How it might be possible to overcome these difficulties was the response which we thought we would be able to find in this report.
However, we think that this is not quite the case. Indeed, we note that, in this context, the Treaty on European Union has gone no further but it already contains solutions which, if put into practice, could solve some of the problems arising from tax erosion, which Community institutions so far seem not to have succeeded in overcoming.
We are referring to the Directive in Article 220 on the rule for reaching a bilateral agreement on taxation matters. As you know, these treaties deal with all categories of income, aimed to eliminate dual taxation, bilaterally harmonizing effective taxation rates at source and in the place of residence and avoiding tax invasion. It seems that this analysis has not been carried out and, in particular, assessment of the adoption and application of these treaties in the Community area. I am surprised at this, and I am also surprised at the approach to mechanisms, such as those for changing the rule on unanimity over taxation matters, virtually without testing the political and practical consequences of the agreements referred to.
The Community has gone no further at this moment than a Directive on dividends, on acts of concentrating businesses and on the prices of transfers between associated undertakings. Harmonization of taxation on interest has been held up for a long time now in the corridors of politics. Therefore, I think that the proposals already tested, but without proven success, should now be renewed. This is not, from my point of view, an appropriate response.
In these circumstances, the effective creation of a single market, the fight against unemployment, the improvement in social conditions and the elimination of impediments to free circulation will be achieved through a concerted policy and incentives to reaching bilateral agreements on taxation matters. When, as in this case, fiscal sovereignty is at stake, consultation and consensus - from my point of view - should prevail.

Cox
Mr President, on behalf of the Liberal Group I should like firstly to say that we welcome the Secchi report and we congratulate the rapporteur. That said, the report is extremely ambitious. It is good to be ambitious but the Liberal Group, while not necessarily against everything that is in the report, has not yet arrived at a level of reflection which allows us to be for everything in the report.
Specifically, I will concentrate my remarks on two things. The first is in paragraph 3, the reference to extending the powers of the Union in respect of fiscal harmonization, to include not only indirect but also direct fiscal harmonization for company tax, tax on capital and so. We have a huge amount of unfinished business in that area of competence which is greatly developed but still not finished, namely the harmonization or the further approximation, to be more exact, of indirect taxation, like VAT and excise. That requires more urgency before we move on to the direct tax agenda.
My second general point concerns the voting rules. We have some concern about whether enough reflection has been given by Parliament - and certainly not enough in our own group - to say that we want to see majority voting in Council also for the area of direct taxation. We have brought ourselves to the point of accepting that, although it may not come out of the IGC, for indirect tax, but not yet for direct tax.
So, we will stop short of fully engaging in all the ambitions of this report, while at the same time not necessarily objecting to the evolution of thinking in that general direction. But not right now, not on the eve of the IGC. We do not think it is on.

Hautala
Mr President, I should like to congratulate Mr Secchi most warmly on a very fine report, and to thank Commissioner Monti for allowing members of the Economic Affairs Committee to participate in close consultations on taxation. In my opinion taxation is precisely one of the issues which calls for action from the European Union. The people expect this too. Ultimately it could be said that the whole of the European welfare state model depends on how we succeed in adjusting taxation. At the moment we are very worried about the level of public expenditure, but we ought to be equally concerned about declining revenues in various Member States.
I congratulate the Commission on its analysis of the dramatic changes which have occurred in taxation in recent years. The central message is that the more mobile production factors move to lower-tax areas, with the result that human labour, which is less mobile, is crippled by an unreasonable tax burden. Things cannot go on like this if we wish to eliminate unemployment. The more mobile a production factor is, the greater the need for harmonization. Capital, for example bank deposits, is one of the most mobile production factors, and taxation of it must be harmonized.
One of the Commission's touchstones is how successful it will be in securing the introduction of a common energy tax. I believe that the European Parliament will do all it can to support the Commission's efforts.

de Rose
Mr President, since tax is a pecuniary requirement, imposed by an authority, on individuals or corporations, mainly to meet public expenditure requirements, there is no doubt that taxes, be it in the choice of the type of revenue - direct taxes, indirect taxes, income tax or capital tax, or in that of expenditure, are one of the main instruments of economic intervention by the State.
On that score, and like monetary or social policy, a prerogative of this type belongs to national sovereignty. But what do we see? Not content to impose the respect of arbitrary criteria which have become incoherent in a period of quasi-recession in the name of the convergence pact, which has effectively dictated a strict monetarist economic policy depriving us of the budgetary instrument, Brussels is now attacking the fiscal instrument. The role of the economy is to serve society and not the other way around.
My group is opposed to the confiscation of the fiscal instrument under the cover of harmonization or coordination. In this way, rather than an association of sovereign nations making up a single market favouring internal free trade, the Commission is asking the States to give up their prerogatives in order to submit them to the growing control of centralizing and authoritarian European institutions.
Besides, how can the aberrations in the Commission report be ignored? Allow me to remind you of a few striking examples: How is it possible to coordinate tax systems as varied and different as these without calling into question the balance of each national tax system which is the result of a slow and progressive evolution? How is it possible to reconcile analytical taxes and synthetic taxes, distribution taxes and progressive taxes, declaratory taxes and pay-as-you-earn taxes, taxes on capital and taxes on labour?
Why and how is it possible to harmonize 15 national tax systems when specific bilateral tax agreements already pragmatically solve most of the questions? Why do we need to speak of such large disparities when they create unfair tax competition between Member States? To my knowledge none of the 15 Member States of the European Union is a tax haven. The reason for expatriation is not so much to seek favourable tax legislation but to seek more interesting employment situations in terms of wages and living standards.
How can we fight tax fraud at European level without creating a mega-file, when all we need to do is gather together and centralize information gathered in national tax files? What balance can be struck between the necessary decrease in compulsory deductions, in particular for small companies, in order to face up economically to the United States and developing countries, while maintaining budgetary receipts that can enable us to respect the criteria of convergence to which we are subjected? How can compulsory deduction systems be harmonized without calling into question certain social systems, because deductions are taxes but they are also social contributions, by employees and employers alike?
To conclude, I should say that, once again, I have a feeling that the idea is to reduce further the small number of national prerogatives remaining for the Member States of this economic union, i.e. the particularly sensitive field of taxation. It is very easy to raise the spectre of limited tax pressure in order to get people to swallow tax harmonization. But when will what remains of our national sovereignty stop shrinking away?

Amadeo
Mr President, quite frankly I have little to add to what the rapporteur and the Commissioner have said. But I feel that it is my duty, and a great pleasure, to comment on what has been said by two such illustrious persons, both of whom lecture at Italy's most prestigious economic university. I shall therefore attempt to make a brief comment, and am honoured to be able to do so.
Mr Secchi's report reaches one important conclusion which merits further consideration. It says: ' As a result of the gradual process of completing the single market, no individual Member State is capable nowadays of abolishing all by itself the remaining fiscal barriers hampering the free movement of goods, persons, services and capital, nor is it capable of combating the effects of tax erosion.' And the rapporteur adds that, if it exceeds certain limits, ' tax competition risks increasing the overall level of fiscal erosion owing to the free movement of capital and the opportunities for fraud and tax avoidance' . The lack of harmonization in tax systems and the resulting fiscal competition are exacerbated by the processes of completing the single market and creating the single currency.
In taking these steps to complete the internal market, I believe that various requirements need to be reconciled: firstly, national taxation systems must allow economic activity to flourish within the different EU Member States. To this end, it is necessary to devise simple, straightforward and effective tax systems with tax bases and lower tax rates of a kind that do not rule out fiscal incentives for SMEs. Secondly, a definitive VAT system, one which is simpler and more effective, must be introduced in an attempt to dispense with the complexity, fragmentation of the market and potential for fraud that are generated by the present transitional system; such distortions, moreover, are hitting SMEs particularly hard. Thirdly, the fiscal disincentives which are having a negative impact on firms, especially as regards cross-border capital flows, must be eliminated. Fourthly, greater flexibility of the labour market must be encouraged so as to avoid double taxation of workers, especially with regard to life assurance and pensions.
As Mr Monti has just said, the development of tax systems which penalize the labour factor was in fact referred to in the White Paper on growth, competitiveness and employment, and I would draw this crucial aspect to the attention of both the rapporteur and the Commission.

Randzio-Plath
Mr President, the European Commission was right to remind us in its strategy paper that fiscal policy in the European Union needs to be reorganized. In my view, the single market and the free movement of capital, rather than monetary union, are the factors that require us to think harder about tax harmonization, and ultimately to adopt measures that will promote it. I am very glad to see that the strategy paper deals with all the areas in which short- and medium-term solutions are required. What is needed here is improved cooperation on tax-related matters, a new approach to harmonizing company taxation, and the harmonization of tax on capital income. The important point in this context is that we should avoid unfair competition within the single European market between countries seeking to attract inward investment, and that we should help to ensure that tax systems in the European Union are genuinely fair. On the other hand, however, we must put a stop to the zero-sum game which is made possible by the existence of tax havens, by the distortion of competition for inward investment on the basis of unfair tax incentives, and by other distortions which, I am sorry to say, are possible under the various systems of taxation.
In the field of company taxation, we need to agree on definitions and bases for calculating tax. In my opinion, we should make an urgent start on the implementation of the Ruding committee recommendations. Another requirement in this area is to make a distinction between the taxation of profits that are withdrawn and profits that are reinvested. We need to take action on these matters urgently. The taxation of capital income has already been discussed many times in the House, and we have proposed various solutions. It is very important to recognize that state subsidies are not the only factor to be considered when it comes to measuring competitiveness. The destructive tax competition which we are currently experiencing in the European Union can be just as damaging, and it is therefore high time that the European Parliament got to grips with the issues in the Commission's strategy paper and, with the help of the Secchi report, defined a clear position on these topics once again.

Paasilinna
Mr President, the Secchi report displays expertise, as does the Commission's analysis. An effective internal market requires effective structures. Tax systems must become more equitable in the interests of employment and balance. Under a single currency system, the public finances of all Member States will be subject to precise individual supervision. Why should taxation not be subject to the same supervision?
The greatest problem is the increasing concentration of the burden of taxation on labour. For some reason it is imagined that businesses which provide employment are wealthier, as they are taxed disproportionately in comparison, for example, with business which go in for automation. In developing tax systems, the distorted way in which tax is levied should be corrected without delay. The minimum requirement is that businesses which provide employment should be placed on an equal footing with businesses using automation. Otherwise our society will wither away because of automation designed to avoid taxation.

Wibe
Allow me in these few short moments to explain why the Swedish party group cannot vote for this report. Our objections are primarily concerned with point 4 which states that decisions on taxation will no longer be taken unanimously in the Council, and point 9 which states that taxes in the Union may not be raised. We think that the right to determine the level of State income and expenditure is a fundamental democratic right for each nation in the Union. If the people in one particular country democratically decide to raise or lower their taxes we should not be able to prevent them from doing so.
Mr President, to uphold each country's democratic right to determine its own taxes we are voting against Mr Secchi's report.

Monti
Mr President, ladies and gentlemen, I would like to come back very briefly, both to assure you that the Commission will take full account of all your comments and to provide some reassurance in the light of the concern you have expressed with regard to subsidiarity. Subsidiarity is at the very heart of the Commission's approach, but as things stand the Member States, though believing that they still have complete fiscal sovereignty, have in fact lost it - and are losing it more and more as the market becomes integrated and opens up: by helping them to coordinate more closely, we are in effect helping the Member States to achieve their own national objectives.
Finally, it is true that more has been achieved as far as indirect taxation is concerned, but it is also vital to make progress on direct taxation too - and to make it soon in respect of capital movements in particular, as several Members have pointed out. This is necessary already for the functioning of the single market, and will be all the more so with the advent of the single currency when, once all the other distorting factors have been eliminated - such as transfer costs and exchange risks - fiscal differences alone will determine capital movements. And this is not an efficient way to allocate resources; that is why the single currency is a further incentive to introduce at least some coordination of taxation on capital.
A very difficult job lies ahead of us all, but if Parliament's attitude is to be as indicated in the Secchi report and motion for a resolution, our work will be greatly assisted by your support.

President
Thank you, Commissioner.
The debate is closed.
The vote will take place tomorrow at 11 a.m.
(The sitting was suspended at 8.25 p.m. and resumed at 9 p.m.)

Impact and effectiveness of the Single Market
President
The next item is the report (A4-0160/97) by Mr Harrison, on behalf of the Committee on Economic and Monetary Affairs and Industrial Policy, on the Commission's communication to the European Parliament and the Council entitled 'The Impact and Effectiveness of the Single Market' (COM(96)0520 - C4-0655/96) and on the Commission Staff Working Paper: ' The 1996 Single Market Review' (SEC(96)2378 - C4-0007/97).

Harrison
Madam President, today has been the ETUC Day of Action in favour of jobs and Europe is rightly crying out for jobs for its 30 million unemployed. But the quickest way for the EU to secure those jobs is by the strict completion of Europe's biggest enterprise, the single European market of 370 million people and by implementing all those important auxiliary measures which substantiate and supplement that market, of which EMU and the single currency is the prime example. Indeed, my report suggests that associating the completion of the market with one of EMU's significant dates could be the goal and ambition which could breathe new life into the European Union on the threshold of a new century.
This year's report on the single market is unusual and promising for a very important reason. For the first time ever we have some real proof of the rewards that result from the bedding down of the single market. Commissioner Monti's excellent series of essays and investigations tabulate well the effect of having a market on various sectors in Europe and of how Europe's competitiveness is being sharpened up to enable us to challenge and succeed on the world stage.
Just look at the figures revealed by Mr Monti's thirty-nine articles. Some 900, 000 jobs have been created directly attributable to the market. EU GDP income rose between 1987 and 1993 by 1 1/2 %. Inflation rates across the EU have been lowered by some 1 1/2 %. Economic convergence and cohesion between regions has been deepened whilst peripheral cohesion countries have strengthened so that now we describe Ireland as an Atlantic tiger economy. The single market programme of more than 280 directives has cut reams of red tape. 100, 000 national standards and labelling laws, 60 million customs and tax formalities have been shredded and binned.
But if that is the good news, there is still much to be done and richer prizes to be garnered. The 'black holes' , as Commissioner Monti describes them, of public procurement and state aid still have to be tackled. The creation of single markets in energy, private pensions and the media industry has yet to be achieved. Labour mobility, aided and abetted by fundamental education and training programmes remains unrealized. SMEs are still the Cinderellas of the market which was made principally with big business in mind. Indeed, only 56 % of the 1985 measures have been implemented by all Member States.
And here lies the source of the problem. It is the Member States who have hypocritically supported the principle of the market but who have been most guilty of failing to implement, monitor and ensure compliance with single market rules. Just look at the case of technical regulations. Some 450 new national technical rules are introduced annually. Sometimes Member States do not even bother to notify the Commission of these national variations, the effect of which is to undermine the market. My plea, and that of Parliament, to Mr Monti is to name and blame those countries which blatantly transgress agreed rules and I am pleased that the Commission's draft action plan to complete the market recognizes these points.
However, observing market rules alone is not enough. Active policies, like realizing the TENs for telecommunication, energy and transport are essential struts in the European infrastructure. Member States must be supporters, not blockers, of these wise flanking measures. But above all should be Member States' concern for the citizen in the street, including shoppers and consumers who have the right to expect effective protection. Moreover 120 million consumers - in other words, Europe's children - have a right to demand the market to work in their favour. Open borders favour not only business people but also child molesters.
Finally, I am pleased that Tony Blair, Britain's new Prime Minister, has declared that his presidency of the European Union in 1998 will see the completion of the market as a first target. Truly a new market for a new Europe and a new hope for all our people.

Berger
Madam President, in its opinion on the communication from the Commission, the Committee on Legal Affairs and Citizens' Rights also expressed its disappointment that the single market has not fulfilled all the expectations which it raised.
As we have already noted critically in other reports, the Member States are still very much dragging their feet over transposition of the directives that have been adopted since the 1985 White Paper; in many cases, our citizens and the economy are suffering from the fact that directives have not yet actually been applied. The legal means that are currently available to the Commission are plainly inadequate to enable it to play its full role as guardian of the Treaties. That is why we support any proposal which strengthens the hand of the Commission and the public in seeking legal remedies where the rules of the single market are being contravened.
In some areas, it is scarcely appropriate to talk of a single market at all. We have spent a great deal of time today discussing taxes, and I should like to refer to one example which concerns differences between rates of VAT. In the case of pesticides, it is no secret that it is still possible for one country to impose a VAT rate of 3 % while another imposes a rate of 20 %, all perfectly in accordance with the relevant EU directive. It is easy to see that this kind of distortion destroys companies' faith in the single market and, in this case, has led to detrimental effects on the environment. We are therefore calling for the completion of the single market programme, and in particular for harmonization in the areas of VAT and company taxation.
The point also has to be made that some other effects of the single market - about which the Commission has been quite frank - should actually give us pause for thought. The impact on employment can so far only be described as extremely meagre. It is clear from the figure of no more than 300 000 to 900 000 new jobs - which is a cumulative figure for a number of years - that the single market alone cannot solve the problem of unemployment. And the increased volume of traffic may result in the EU being unable to meet its international obligations as regards the reduction of CO2 emissions.
For these reasons, we support the Commission in taking any steps that will help it to be more effective in this area, and we would call on the Member States not to deprive themselves and their citizens of the positive effects of the single market.

Monti
Madam President, I should like to congratulate Mr Harrison on his excellent report: it gives us ample food for thought, now that we have reached the stage of preparing a final version of the action plan for the single market. In fact, Mr Harrison, we have already incorporated into the plan many of the points raised in your report. I hope I can take this as a sign that the Commission will be strongly supported by Parliament in carrying out the plan itself.
The origin of the single market action plan, to be presented to the Amsterdam European Council in June, was the analysis contained in the communication on the impact and effectiveness of the single market, which is the subject of the report before the House today. Our plan sets out the measures to be adopted as a matter of priority, so that the single market can underpin the transition to the single currency that will begin on 1 January 1999.
We all agree on the need for a new degree of political commitment to secure a single market that will meet our social requirements and achieve its full potential, which it has not yet done completely in terms of employment, growth and competitiveness.
In this major political initiative - the action plan - we are proposing that the European institutions and the Member States undertake a very serious task. It is just 18 months from now until 1 January 1999: we realize that agreement will not be reached on everything in such a short space of time. But we must focus on certain priorities and seek to achieve practical results, so as to launch a dynamic process in which a truly operational single market is the cornerstone of the Union's development.
I should like to take this opportunity to explain how the approach outlined by the rapporteur, Mr Harrison, fed into our action plan. I shall do so by touching briefly on four points: the first concerns the need to improve the efficiency of the existing single market rules. This is a crucial element if we wish to increase business confidence in the market, which requires better and prompter implementation of Community law in the Member States.
Our second priority objective is to combat the main distortions of the market, which result from fiscal barriers and anti-competitive behaviour. Only more coherent and better coordinated fiscal conditions will ensure that European companies really do regard the single market as a large national market. That is still a long way off. One key element of a fiscal package should be a code of conduct whereby the Member States undertake to act in a more transparent and coordinated way, in order to avoid excessive fiscal competition. A more rigorous approach to competition policy is also crucial for ensuring that the dynamic of the single market is not hampered by anticompetitive behaviour on the part of firms, or by state aids.
The third objective of the action plan is to dispense with the remaining sectoral obstacles to market integration. We wish to limit the adoption of new legislative measures to a bare minimum, in a policy geared to simplifying existing legislation, rather than creating new laws. In certain specific cases, however - such as financial services and teleshopping - a legislative framework could prove necessary. Similarly, decisions are needed on proposals which are still pending, such as those on biotechnology and company law - a sector where the Commission will consider how best to adapt the proposal on the Statute for the European Company in the light of the recommendations put forward by the Davignon group, at the initiative of Commissioner Flynn and myself.
Finally, there is the fourth but equally important point, which I am pleased to mention in the presence of Mr Flynn himself: the action plan will contain proposals designed to consolidate the social dimension of the single market in two major sectors: the protection of workers' rights and the development of mobility within the Union. The Commission is convinced that industrial restructuring, which is also assisted by market integration, is necessary and beneficial for the Union, but we appreciate that it can have damaging social effects. Full compliance with existing Community rules on the consultation of workers is absolutely vital to ensure unswerving political support for the single market.
In its action plan, the Commission calls on Parliament and the Council to examine the legislative proposals contained in it as a matter of priority, so that the best possible results can be achieved within the tight timeframe - 18 months, as I said - set out in the document.
I can assure you, on the other hand, that the Commission is thinking not so much of a formal interinstitutional agreement as of a political commitment to examine the legislative measures with the utmost urgency. Priority treatment should therefore be given in this case both to the proposals which are already before Parliament - biotechnology, the liberalization of gas supplies and the transparency mechanism for the information society - and to those which the Commission will present shortly as part of the action plan.
I am most grateful for the attention which the House has given to the communication on the impact and effectiveness of the single market, and I would compliment Mr Harrison once again on the high quality of his report. The Commission is looking forward to cooperating closely with you in implementing the action plan, and in this context I should be happy if the European Parliament could signal its agreement that the action plan, which I have outlined to you this evening, is indeed the instrument best suited to achieving our intended objectives - an indication that you agree with our chosen objectives and will support the process we have devised to put these into effect, as well as agreeing to attach the necessary priority to dealing with the legislative proposals which the plan contains. I am asking a good deal of the House, but I know how keen you are to see the single market fully completed.

Billingham
Madam President, I should also like to congratulate Lyndon Harrison for a very comprehensive and searching report which seeks to complete the single market. I would like to pick up three of the issues addressed which are vitally important.
The first concerns small and medium-sized enterprises which he rightly describes as the backbone of the European economy. They still find themselves thwarted by excessive directives, red tape, and literally hundreds of pieces of legislation which make their burden intolerable. This burden, as the Commissioner has just said, must be reduced and the procedures simplified.
Secondly, I should like to endorse the call in the Harrison report to complete the trans-European networks. Energy, transport and telecommunications are crucial to create the platform for economic success in Europe. Success equals jobs and on a day when thousands of workers demonstrated outside our Parliament their rightful demand for jobs, this is a positive way to redress the balance and the answer to their demands. More than that, transEuropean networks provide a proper basis for universal service for public services for all our citizens of Europe, making their lives better and building a better future.
Finally, I am sure that Commissioner Monti will not be surprised that I support Lyndon Harrison's proposals for labour mobility and a common European employment policy. As I speak, French ski instructors and authorities have prevented a single British ski instructor from working in the French Alps. And that is despite the assurances given by the Commissioner six months ago that not only was it illegal but that he would instruct the French ski instructors to act accordingly.
This report goes a very long way to sharpening up legislative procedures in the EU and therefore I welcome it.

Peijs
Madam President, my congratulations go to our rapporteur Mr Harrison, who has produced an excellent report on an extremely important issue. The application of the single market has caused a revolution in the Member States of the European Union. Even if the rather unrealistic expectations set out in the Cecchini reports have not always come to fruition, such as the millions of extra jobs, at least investment has increased, inflation has fallen, between 300 000 and 900 000 new jobs have been created, and the economies of the Member States have become closely interwoven. But there is still much that needs to be done. Look at public contracts, for example. France and Germany are making a complete hash of the directives in this area, and this is something that needs to be looked into very carefully. Then there are financial services and insurance, where we still do not have a single market within the Union and a great deal more needs to be done.
A considerable number of measures have still not been implemented by the Member States, and in order to give fresh impetus to the completion of the single market, the Commission is to put an action plan before the European Council in Amsterdam in June. It is urgently needed. Member States are either too late with their implementation, or else they introduce so much legislation that you cannot see the wood for the trees. Even Parliament, to be honest, is sometimes guilty of this. The target date for harmonization is long past, yet the barriers still remain.
Next, small and medium-sized businesses. As the Commission also notes in its working document 'The 1996 Single Market Review' , small and medium-sized businesses have benefited less from the single market than large firms, and my group would like to join Mr Harrison in expressing our concern about this through his resolution. The completion of the single market must be made more profitable for SMEs by increasing their exports, for example, which is where the euro and its associated payment systems will help.
The costs of complying with the new administrative, technical and fiscal single market legislation also present a major problem for small and medium-sized firms, and I would urge the Commissioner to listen very carefully to what these firms have to say about the problems they are facing. Simpler and clearer legislation would help them more than all sorts of different subsidies that are difficult to obtain.
What do small and medium-sized firms actually want? They want better consultation procedures in all kinds of fields such as economic dialogue, trade dialogue, social dialogue, perhaps even fiscal dialogue. They want improvements in the collective research and development programmes for SMEs, and they want them to be made more accessible.
Thirdly, there is the reduction in the financial burden for firms operating across borders and in the costs of international bank transactions. The directive on this is to come into force at the same time as the euro. I think we do not have any further problems with this, and I hope that the action plan will work. The single market is one of the European Union's most important achievements, but without this fresh impetus, we can only expect its benefits to be diluted by enlargement.
Strict management and discipline are required from the Member States if the single market is to be preserved.

Boogerd-Quaak
Madam President, I too should like to thank Mr Harrison for his report and in particular for including various amendments. I would urge Mr Monti and possibly also Mr Flynn, who is here today, to give closer attention to two aspects of the single market: taxation and, as Mrs Peijs said, insurance. If we look at what Mrs Berger's report has to say, for example, about how pension funds are not allowed to operate in certain Member States and cannot offer their services or invest there, it is clear that this is the other side of the single market.
The same applies to certain banking services. I can give you examples of dealings between my country, the Netherlands, and Belgium, say, where a mortgage offered by a bank in the Netherlands for a house in Belgium cannot be exempted from tax. I know that things have changed since the Bachman judgment, but it does not take us very much further forward.
I would therefore urgently call on both Commissioners to give particular attention to these aspects of the single market, which directly affect citizens wishing to use services provided in one country where they are working, for example, but which have to be processed fiscally or otherwise in a second country. This issue is dealt with in the Berger report and is also covered in Amendment No 12.
I would finally also ask for attention to be given to the Statute for the European Company. I hope that the Commission will succeed in getting this issue on the agenda for Amsterdam in June.

Porto
Madam President, I must congratulate the Commission, in particular Commissioner Monti, and Mr Harrison on the documents which have been presented, which are a timely assessment of the experience of the formation of the single European market.
There can be no doubt about the positive role of initiatives taken in the 1980s, beginning with the 1985 White Paper, followed by the setting of a date and simplification of the legislative process through the single European act. That positive role cannot be called into doubt given the developments which have fallen below the predictions in the Cecchini report, which were excessively optimistic, but back then it was impossible to predict the fall of the Berlin Wall and the recession of the early 1990s.
It is somehow significant that, according to the figures already divulged and analyzed on the basis of various models, the single market which began in 1993 has led to 300 to 900, 000 extra jobs and a 1.1 to 1.5 increase in the European GDP, as well as a 1.1 to 1.5 reduction in the inflation rate.
However, we cannot limit ourselves to observation of these figures, and it is important to know whether, in face of difficulties which have arisen, we would have been better off if this initiative had not been taken, and the answer to that is a resounding 'no!' , since the current problems would probably have been even worse - e.g. unemployment, a result fundamentally of a technological evolutions which we could not have avoided unless we wanted to put our future irremediably in danger.
Since this has been a positive experience, it is not enough now just to top it up or make a few adjustments. Together with the introduction of the euro, we must now take a global and ambitious initiative, through a coherent set of projects which, apart from immediate aims to be achieved, would mobilize enthusiasm and involvement by all Europeans.
That is the only way of meeting the challenges of creating stable jobs in competitive sectors worldwide. That is the desire that I wanted to express in my short speech.

Monti
Madam President, I should like to thank Members for helping us, through this debate, to finalize the Commission's action plan. Without commenting on all the contributions, I would single out the emphasis you have placed on SMEs - which are at the very heart of our action plan, especially in terms of legislative simplification; the attention which you have all drawn to proper compliance with the rules of the single market; and also the problem of enforcement, using the appropriate instruments to ensure more swiftly and effectively that the single market rules are indeed being complied with.
I shall not go into any other points, in spite of their importance - from the Statute for the European Company to financial services - and will end with the following remark: it seems to me that, at a time when so much attention is being devoted to the single currency and the timetable for it, we must not forget that economic and monetary union does indeed mean the single currency, but it means economic union as well. If we are to bring development and employment to the European economy, full economic union is just as crucial as the monetary union that will accompany it. The single market is the central pillar of economic union, and therefore all our joint efforts to complete the single market should be seen in this framework: one of full support for growth and employment in Europe.

President
Thank you, Commissioner.
The debate is closed.
The vote will take place tomorrow at 11 a.m.

Non-conventional medicines
President
The next item is the report (A4-0075/97) by Mr Lannoye, on behalf of the Committee on the Environment, Public Health and Consumer Protection, on the status of non-conventional medicines.

Lannoye
Madam President, I think it could be said, without risk of error, that the harmonization of national legislation concerning the medical profession and medicines is a process which is now virtually completed in the European Union.
As far as non-conventional medicines are concerned, i.e. therapeutic approaches not recognized by the medical order, this is far from being so. In fact, in the European Union, the diversity of legislative approaches is quite extraordinary. We also live in a system of incoherence. It is my opinion that we should put an end to this state of affairs as quickly as possible.
When I say difference of legislations I can give a few examples. In Germany, for example, homeopathic medicines are included in the national pharmacopoeia. In Great Britain, osteopaths and chiropractors are legally recognized professions, with normal surgeries, and the same goes for chiropractors in the Scandinavian countries, Sweden, Denmark, Finland.
Those are clear examples whereas in other European countries all of these professions are illegal and the practice of these therapeutic approaches if not banned at best are tolerated - but sometimes also prosecuted.
I think it is time, as I said, to bring an end to these incoherencies and meet increasing demand from patients. The obvious cannot be denied: increasing numbers of European people want to be treated by means of these so-called non-conventional therapies. Surveys carried out by the Commission itself have come up with striking figures, with as many as 50 % of those surveyed calling for access to these therapies.
What is the meaning behind the report which the Committee on the Environment, Public Health and Consumer Protection is proposing? It is precisely to embark on a process of recognizing these non-conventional therapies, obviously on the basis of existing achievements, particularly what has already been achieved in countries where those therapies have already been recognized, on the basis of vital studies which show the effectiveness of therapies to be legalized, on the basis of the requirement of high-level training for practitioners - diplomas and recognition should not be given away - and last but not least on the basis of organized dialogue between allopathic medicine and non-conventional medicine, so that this dialogue can lead to a harmony, making it possible to apply these approaches in complementarity.
That is the main spirit and content of the report which the committee is proposing to us and which I hope the majority of this parliament will support tomorrow.
I would like to make the most of the time remaining to refute some claims which I think are prejudicial. Contrary to some of these claims, we are not trying to open the door to charlatans, to recognize anything whatsoever, to lead to mayhem in health care. On the contrary, I think that the only way of protecting serious practitioners against charlatans and protecting patients is to adopt appropriate legislation. Burying our heads in the sand, despite the fact that a large number of people are already resorting to non-conventional medicines, would not be a responsible political attitude. It is a conservative attitude which, in any case, sooner or later, will collapse in view of the facts.
I should like also to take this opportunity to quote the Indian Health Minister who recently addressed the 50th session of the WHO Assembly in Geneva, which he chaired. He said that it was also necessary to recognise the role played by traditional systems of which many countries were rightly proud. He added that it was impossible to ignore these systems in a zealous attempt to subscribe exclusively to modern science and technology. He mentioned his own country, India, which alone had contributed to the creation of three medical systems, offering a wealth of scientific knowledge and a very rich literature which had enabled an effective response to be made to certain illnesses. The answer to all illnesses could not be found but certainly to some.
He continued by saying that, in order to meet the requirements of the modern world, these approaches had been given a legal framework in India and an organised structure. Standardization had been carried out and welldevised training courses existed, leading to a practitioners' register. It might be interesting to organize an international conference on the subject of traditional medicine systems, in order to find out what their potential was, to dispel misunderstandings and to decide on positive recommendations so that they could be adopted more widely.
Those were the words of the Indian Health Minister. I propose that we draw inspiration from what he said, not only about traditional medicines, but also for the more modern approaches which also have their part to play and which I think should be officially recognized. The European Parliament is certainly the most appropriate place to set that process in motion.

Alber
Madam President, ladies and gentlemen, it was the task of the Committee on Legal Affairs to determine whether the European Union has the power to regulate the field of non-conventional medicine in the first instance. We concluded that it has. It is a fact that a great many articles of the Treaty - Articles 3(o) and (s), 36, 56, 100a(3), 129 and so on - refer to health and health protection. And it is also a fact that none of these articles provides for Community legislation.
However, it can be concluded from these repeated references to health that health protection has to be an important component of European policy. The cross-border dimension of this question concerns in particular freedom of establishment and freedom to provide services, which also extends to non-conventional medical practitioners, as well as trade in goods - the relevant medicinal products - and services - such as the right of patients to choose their doctors across borders.
We felt that Articles 54, 63 and 100a in particular could be considered for the legal basis. The fact is, however, that Article 57(3) seems to provide the most appropriate legal basis, because of the specific reference there to 'medical and allied professions' - a comprehensive term. This wording is so general that it can be applied to nonconventional as well as to conventional medicine. Article 57(2) is concerned with powers of harmonization. It could be argued, however, that no - or only some - Member States possess legislation in this field, and that it is impossible to harmonize something that does not yet exist. Nevertheless, we believe that the Community does have competence in this field, since on the one hand there is a danger that the great variety of national rules could give rise to legal uncertainty and, on the other hand, national sovereignty - or the principle of subsidiarity as we now call it - does not rule it out.
As a second point, the Committee on Legal Affairs takes the view that different directives should not be enacted for each individual type of non-conventional medicine, since the very contentious issue then arises of what is nonconventional medicine? It can develop into conventional medicine, but it can also degenerate into magic or esotericism. In any event, it is much more important to enact a basic directive, and we therefore do not wish to have either an abstract definition or seven different directives.
I should personally like to say, moreover, that this report does not even refer to the most important form of nonconventional medicine: red and white wine.
We believe that it is more important to enact a basic directive that encompasses general points and is applicable to all. The most important principle is to ensure a very high level of patient protection. Perhaps the clock is wrong, Madam President. I have not spoken for three and a half minutes yet!
(Laughter, applause) The most important principle is the protection of patients, and the Committee on Legal Affairs is therefore proposing that very high standards for the training of non-conventional medical practitioners must be established. The latter do not necessarily have to be doctors who can produce a corresponding diploma, but it must be ensured that they have a basic knowledge of general medical principles. Naturally, the individual professional organizations should then participate in deciding on appropriate training standards.
An example would be the German law on non-medical practitioners. This is the level of regulation that should be introduced for non-conventional medicine. There would also have to be the requirement to provide information and compulsory liability insurance. This issue is too extensive to address in just two minutes, and since no one else will wish to make a long speech on this subject, I think that I should be allowed to overrun my speaking time. In short, the Committee on Legal Affairs has come to the conclusion that Community competence to regulate these matters does exist, and that, in the interests of patients and people seeking to be treated, it should undertake that regulation.

President
I realize that people like to listen to you, Mr Alber, but I did say - which you will not have heard just now - that we have an extremely long agenda this evening, and if we are to complete our work by midnight, it will only be by keeping to time. So I must insist that the following speakers keep to their speaking time.

Roth-Behrendt
Madam President, I shall try to stay within my speaking time, since I notice that, all of a sudden, the clock is right again, although it was unfortunately wrong during Mr Alber's speech - for which, I must admit, I am not ungrateful. Indeed, part of what I wished to say has been pre-empted by Mr Alber's comments on behalf of the Committee on Legal Affairs, and it is therefore superfluous to talk about the need for freedom of establishment or matters concerning the internal market.
Let me address a number of other points, therefore. In the European Union, we are very tolerant in our dealings with one another, and I trust that we shall also manage to be so in the debate on this item of the agenda. We are not discussing legislation here, but an own-initiative European Parliament report, which seeks to prompt the Commission to consider the need for legislation. When I look at the ideological war which has been waged by the professional associations of doctors over the last few months, however, I am not entirely sure what this matter is about.
For us - as Mr Alber has already made clear, I am glad to say - it is a question of safeguarding and upholding the principles of the internal market, notably the freedom of establishment, and also of ensuring a high level of patient protection. I do not know who has the right - or thinks they have the right - to deprive people of the freedom to choose their treatment. I do not concede that doctors have that right. I do not concede that the training of doctors gives them the right to decide what is best for patients. There are different situations in the different Member States. In some Member States, there are chiropractors, practitioners of different types of massage, non-medical practitioners, acupuncturists, and so on; and patients from other Member States must be provided with access to their services if they so wish. My group sets great store by the freedom of adult citizens of the European Union to choose and make decisions, and I trust that colleagues in the other groups do so too. I believe that, to a great extent, they are capable of deciding for themselves what they want. So it is important for us to insist that the people treating these patients know what they doing - in other words, that they are properly trained.
This is what Mr Lannoye and the Committee on the Environment are calling for in the report. They are demanding that anyone practising a form of medicine - any form of medicine - should be properly trained, so that they know their limits, and know when it is time to let a conventional medical practitioner, a surgeon, or an internal specialist take over. This requires them to have a qualification, and the granting of this qualification has to be regulated Europe-wide, since the safety of patients must be guaranteed in equal measure in the United Kingdom, Ireland, Denmark, Spain and so on.
If training courses and the granting of diplomas are regulated in this way, patients in the European Union will be protected, and will be able to decide for themselves whom they trust and who they wish to treat them. This is what we are calling on the Commission to do. We are calling on it to take action and bring forward appropriate legislation.

Liese
Madam President, ladies and gentlemen, during the debate over the last few weeks, we have become acquainted with a great many extreme positions, and it will undoubtedly be the case again this evening that these extreme positions clash with one another. At the beginning of my speech, therefore, I should like to introduce a somewhat more conciliatory tone. I am myself a so-called conventional medical practitioner. I underwent medical training and - to the extent that my time allows - I still work in the field of conventional medicine. I am sure that there will be general agreement, as a number of colleagues have pointed out, that conventional medicine has made tremendous advances over the last few decades and helps many people.
On the other hand, we have to recognize the fact - and I know this from practical experience - that many people do not find what they are looking for in conventional medicine. Especially when they are suffering from chronic illnesses or long-term health disorders, many people turn to so-called non-conventional therapies. There is, of course, a reason for this. Like many other colleagues, I believe that the vast majority of these therapies have absolutely no effect, other than that of a placebo. Nevertheless, people do turn to them.
I believe that the reason for this is, above all, that therapists and other practitioners of non-conventional medicine listen to people. They perform a function that clearly no one else in society fulfils. We cannot blame this on doctors alone, since because of the billing system, because of the costs, doctors are not always able to take as long with their patients as is perhaps necessary. This is a reproach to society as a whole. The decline of the family, perhaps in some ways also the increased detachment from the Church, are leading to the disappearance of traditional structures which once ensured that people always had someone to listen to them.
In some countries of the European Union there are non-medical and similar types of practitioners, and in others there are not. Perhaps the fact that there are no non-medical practitioners as such in Italy has something to do with the fact that this need is catered for by other mechanisms in that country. I do not know, and it is very difficult for us to judge the matter this evening. I am merely offering food for thought. We should not simply believe that everything about conventional medicine is perfect, but should give some thought to the reasons why people turn to non-conventional medicine.
Nevertheless, my group has serious problems with Mr Lannoye's report in its present form. I have long endeavoured to reconcile the different positions that exist in Parliament in some way. However, there is a key problem which we cannot get round, even with the best of compromise proposals. On the one hand, Mr Lannoye's report seeks the greatest possible freedom of choice for patients and therapists. On the other, it seeks the greatest possible safety - and therein lies the problem. It transpires that certain therapies have proven effects which can be scientifically verified. I am greatly in favour of promoting these therapies and their use by doctors. However, there are other therapies which, by their very nature, are not susceptible to basic scientific verification. The user believes that a therapy helps. Indeed, he is convinced of the fact. But a third party cannot verify this in accordance with scientific principles. The question is: how, in such circumstances, does one establish the border between use and abuse? How, for example, does one pursue an action for damages, if objective verification is impossible?
I believe we must consider this very carefully, not least because some non-medical practitioners in Germany and other countries maintain that it could be dangerous for Europe to lay down strict criteria, since that could lead to them no longer being able to practise in their own country as before. We also receive critical letters from users of non-conventional medicine telling us that it is better to leave well alone. The question of subsidiarity must also be considered in this respect.
I believe that all these reasons should lead us not to adopt Mr Lannoye's report in its present form. This is not a rejection of so-called gentle medicine. It is a rejection of what has so far been an inadequate attempt to harmonize it at European level.

Cabrol
Madam President, ladies and gentlemen, let us not be mistaken. The rapporteur is repeating his old refrain with new words. After having spoken to us in previous years of parallel medicine, complementary techniques, alternative therapies, now he is telling us of non-conventional medicines, in the hope that we will forget that behind this word are hidden esoteric notions - shiatsu, sikh, and others. These are vague, woolly, unverifiable notions.
The rapporteur is quite simply asking for a Directive to recognize these so-called medicines and those who practice them. But on what guarantees? The report is vague on that point. With a diploma? A university diploma? No. A diploma awarded by the practitioners themselves 'as a result of a rigorous self-regulatory process within the profession itself' . That means that these practitioners would form a jury and therefore be both the judge and defendant. Would you entrust your health to such practitioners? For example, would you travel in a plane with a non-conventional pilot in the cockpit?
The rapporteur wants to convince us by pointing out that some of these practices enjoy a form of legal recognition in certain Member States. Does that mean he wants us to align ourselves on the most laissez-faire States in such a serious area? By the way, he has no scruples about attaching a false meaning to certain articles of the Treaty, in particular Article 57 (3). Amendment No 10 calls for the assessment of these non-conventional practices. But by whom? By a serious, officially recognized scientific committee? Not at all. By a joint committee including practitioners from both schools of medicine, conventional and non-conventional. What on earth is this? You would think that we are at a religious synod or a trade union meeting.
But that amendment goes further. In the following paragraph, to simplify, it quite simply recommends committees comprising only qualified practitioners in these non-conventional techniques. Practitioners qualified by whom? Of course, in Amendment No 11, we should immediately stop pursuing these 'honourable practitioners' . Here, we can begin to detect some of the interference by the lobbies behind this project. While he is at it, the rapporteur also wants the pharmacopoeia to be reformed, changes to the list of authorized medicines and, as in Amendment No 15, to have medicines and practitioners reimbursed by the social security system.
This is an extraordinary paradox: just as Parliament is demanding a tightening up of security and safety for consumer protection, here we are talking of abandoning the health safety of those same consumers, our fellow citizens, our children, to individuals without qualifications - or with sham qualifications, using unproven medicines, at the taxpayers' expense. That really is going too far! I am certain, ladies and gentlemen, that you will reject a report of this kind which would discredit us in public opinion.
Mr Lannoye, stop showering us with these mass-produced letters, signed by the same hand, illegibly. It is not worthy of you or of us. And do you not think that this money would be better spent on a proper health project?

Kestelijn-Sierens
Madam President, non-conventional medicine in all its various forms and disciplines is a reality which we cannot ignore. As the rapporteur said, some Member States have already recognized a number of these forms, but they are all practised, even in Member States which have recognized none or only some of them. If we vote against this report today, it will not mean that non-conventional medicine will suddenly disappear overnight. On the contrary, we would simply be giving carte blanche to non-qualified practitioners. In our view, denying reality is the wrong approach and fails to solve the problem of illegal practice.
In the interests of patients, doctors and practitioners of non-conventional medicine, we are therefore calling on the Commission to carry out a detailed study to obtain information on the following questions: is the discipline in question safe and effective? How widely is it practised? What can it be used to treat, and what not? Is it a supplementary discipline to be practised alongside traditional medicine, or is it intended to replace it? And finally, in which Member States is the discipline already recognized? What are the conditions in each Member State? And what training in the discipline is available?
Until the Commission carries out such a study, we feel that there can be no question of coordinated legislation or legalization at European level.
Our group also feels that the problem of whether or not payments should be reimbursed by the social security systems is purely an issue of subsidiarity. We oppose Amendment No 15 tabled by the rapporteur.
The Liberal Group hopes that the majority of Members will vote for this report, which is an acceptable compromise, and in particular will approve the first section of paragraph 2. This is of the utmost importance for us. If this does not happen, then we shall be forced to vote against the report as a whole, which we should very much regret.

Ahern
Madam President, I rise to welcome this report which attempts to orchestrate some basic harmonies in a rather chaotic symphony. The popular acceptance of non-conventional medicines is a fact of life. But how this is to be regulated in the European Union is not so obvious. The rapporteur has made a valiant effort to achieve a consensus out of a variety of cultural experience.
For the English-speaking world I would venture to put on record that the acceptance of non-conventional medicine is a core value in that culture and is woven out of three different strands. One, that part of European traditional medicine which was excluded as Western allopathic medicine developed in the 19th century out of the disciplines of the apothecary and surgeon - and I speak of manipulative medicine and herbalism in particular and also of homeopathy.
Two, the traditional medicine of the non-European world which was overwhelmed by the power of the Western mindset, also in the 19th century. Three, the de-skilling of women as primary health care providers as medicine became institutionalized in the 19th and early 20th centuries.
In these three strands we are talking of the inclusion of what was excluded which is a major focus of democracy in the European Union. So, we are not simply talking about listening and caring, but about proper practices. Many of these disciplines are extremely profound and have their own practical traditions which are very effective.
Let us be sensible and adopt this sound and sensible proposal or we will risk a great divergence and indeed, discordance, in the Union. In any case, the UK and Ireland will persist as centres of excellence for nonconventional medicine. We have this tradition of regulation by professional bodies, not with the kind of legal base that is common in other states of the Union. Indeed, this is non-problematical in many areas of cultural life in these countries. The financial sector is a case in point.
I would ask the Commissioner to consider the amendments I have tabled on behalf of the Greens which give priority to non-conventional medicine disciplines which enjoy some form of recognition and organization at European level already. I hope we can take this excellent report on board.

Blokland
Madam President, the non-conventional medical practitioners have obviously done their work well, since here Parliament is discussing yet another report on improving the status of non-conventional medicine.
What is it all about?
The recognition of non-conventional medicines clearly involves a conflict of interests. Conventional medical science generally has a low opinion of non-conventional medicine, which it sees as competition and whose practitioners it even sometimes views as dangerous or unscientific. Behind this conflict lies a fundamental difference of opinion about mankind and what illness really is.
This motion for a resolution tries, fairly successfully, to bridge the gap between the 'objective scientists' and the non-conventional practitioners. The first two paragraphs rightly stress the need for detailed research into the safety and effectiveness of these medicines, which lifts the debate above the purely emotional level.
However, what I find less welcome is the fact that European law is now being expected to solve a conflict that is primarily being waged at national level between protecting the patient, quackery, and allowing the patient freedom of choice.
Including non-conventional medicine under 'medical and allied professions' under Article 57(3) of the Treaty is far too broad an interpretation. This was not what this article was intended to cover, as both the Commission and the Council have stated. Perhaps this could be confirmed again. The article in question actually deals with the coordination of the conditions for practising certain medical and allied professions in the Member States.
I would therefore prefer this issue to be dealt with through subsidiarity at Member State level.
Freedom of establishment is the only truly European issue here, and economic considerations must not be allowed to outweigh the medical or ethical aspects. Non-conventional practitioners have to pay the price for this: they must abide by the rules of the country in which they are established, rules which have been introduced through democratic processes. However, this need not be too great a burden, since successful research into nonconventional medicines may mean that treatments which are proven to be safe and effective are included in conventional medicine.
In my view, using European rules to impose greater freedom is not acceptable.

Féret
Madam President, first of all I must congratulate the rapporteur on the effort he has put in in such a specialized field. Mr Lannoye has always impressed me with his huge knowledge of ecological matters. But medicine is quite another science and I am disappointed to have to say that, in drawing up these reports on nonconventional medicines, Paul Lannoye has been ill-advised, misguided and misinformed.
All practitioners in the art of curing, including me, recognize the uselessness, even the danger, of over-relying on technological methods for reaching a proper diagnosis. Similarly, chemotherapy is part of the therapeutic arsenal to be used with discernment and moderation. I have always been a partisan of learning about and the use, as a complement, of less aggressive medical techniques, provided they are correctly practised - e.g. homeopathy, manual medicine, acupuncture - as well as massotherapy, unfortunately left out of this report.
But it is commonsense that whatever the means of therapy chosen, medicine can only be practised by medical doctors who have had full training in a European university - European universities being, nobody will deny it, the best in the world. The rare mistakes or excesses committed by a few doctors cannot justify leaving the art of curing in the hands of health 'officials' whose practices sometimes are more like witchcraft than medical science.
When a plane crashes following pilot error, nobody ever thinks of training non-conventional pilots. I therefore insist that all of my colleagues who are not doctors should understand the overriding need to integrate the teaching of so-called 'soft' , ' alternative' or 'non-conventional' medicines in the main university training courses for all doctors. The vital principle of primum non nocere cannot be reserved only to allopathic therapy but must apply to the art of curing in all forms.
I must express my very sincere regrets to the rapporteur, but I think that it is my duty not to vote for his report.

Needle
Madam President, very often Members of this Parliament are called on by our citizens to set out the benefits and disadvantages of the European Union. Very often we explain them in terms of rights and responsibilities, the freedoms and rights of the single market and the social and legal responsibilities which are fundamental to its fair achievement.
The debate about non-conventional medicines, which is undoubtedly controversial, crystallizes that wider debate. Our citizens are demanding rights. Consumers are clearly demonstrating their demand for non-conventional medical products and treatments. Studies, for example, by the UK Consumers' Association show that one in four people now visit non-conventional practitioners by choice. In turn, those practitioners seek the rights of movement enshrined in the treaties. Yet perfectly respectable osteopaths and chiropractors, for example, who are legally permitted to practise in some states, such as my own, face serious penalties in others - let alone receive any encouragement.
So, demand for change exists from both patients and potential healers. But for potential legislators, there must be responsibility too. The risk of exaggerated claims of miracle cures, of weakening of standards and of insufficient regulation is arguably real although international bodies which are strong in, for example, the field of homeopathy, have worked very hard to raise awareness and standards.
That is why Mr Lannoye's tenacity in bringing this initiative to Parliament tonight is to be applauded and should be supported by votes tomorrow, as my splendid colleague Mrs Roth-Behrendt has urged tonight. It may be imperfect as Members both for and against are arguing tonight but it represents a step in the right direction towards better access and choice for patients, the removal of barriers for responsible and properly regulated practitioners, recognized standards of training and qualification and the possibility of sensible integration into future conventional health systems at an appropriate later stage.
That has been gradually welcomed by the British Medical Association since 1993 and while we must work with the Commission and other agencies to scrutinize future proposals carefully and also consider very carefully remaining genuine reservations, it would be the right and responsible decision of this Parliament tomorrow to lead the way forward for an open-minded approach to tackling some of the very real health needs of citizens throughout Europe.
(Applause from the left)

President
Ladies and gentlemen, I have to say something to the visitors in the galleries. Our Rules of Procedure have been established, and these state that visitors in the galleries are to remain seated and keep silent. Anyone expressing approval or disapproval will be immediately ejected by the ushers. I would just point that out to you, because the rules are indeed administered in that way. We like the general public to have the chance to listen to what takes place here. But you are not allowed to participate in any way, whether you express approval or disapproval. I would ask you to respect this, since otherwise I shall have to tell the ushers to remove you from the galleries.

Trakatellis
Madam President, first of all I should like to emphasize the fact that medical science is a single science and there is no such thing as 'alternative' or 'non-conventional' medicine, just as there is no such thing as 'alternative' physics, chemistry or architecture.
Secondly, medical science has already shown what a considerable contribution it has made to protecting people's health and also to restoring it when it is endangered. That is obvious from the large increase in life expectancy, well-known achievements in the field of vaccinations, and the amazing progress in diagnosis and surgical methods. Heart surgery is now regarded as almost routine.
Thirdly, I should also stress the fact that medical studies are lengthy and difficult and usually last at least ten years in all.
Fourthly, in medical practice, apart from doctors themselves, there are also other scientists and professionals such as physicists, chemists, laboratory assistants, psychologists, physiotherapists and others all of whom work for the service of patients and always under the responsibility of doctors. That could also be the case of some of the teams referred to in the rapporteur's report but he wants to make them independent and give a licence to nondoctors who wish to carry out medical practices. I am totally opposed to that.
The fifth point I wish to emphasize is that in order to tackle a medical complaint a proper diagnosis must be carried out. The danger here is great since therapy by non-doctors, without proper diagnosis of the illness, could be dangerous and it could possibly lead to a delay in treatment by proper means and that is a basic point in medical science, unfortunately not accounted for in this report.
My sixth point is that everyone knows that it is impossible for any new medicine to be used by doctors unless it has undergone lengthy and documented tests so that responsibility can be taken for its circulation, something which again is overlooked in the report.
Finally, I should like to say that the health of European citizens, one of the most precious assets, must be the responsibility of doctors with whom any paramedical branches who wish to help sick people must cooperate. So far medicine has worthily assumed that responsibility with brilliant results.
I hope that the European Parliament will reject this report because, if it is adopted, I think that we will be taking several steps backwards in the protection of the health of European citizens.

Linser
Madam President, in the debate on the merits of non-conventional medicine as opposed to conventional medicine, the issues of a lack of humanity and the decline of the relationship of trust between doctor and patient are repeatedly brought up. I wish to emphasize in the strongest possible terms here that humanity, trust and personal commitment depend not on the method of treatment, but entirely on the person carrying out the treatment - in other words, the doctor or therapist.
The clear and unequivocal demand set out in recital J of the report for clinical trials and comprehensive, scientific tests of effectiveness to be adopted as a prerequisite for the recognition of non-conventional medical disciplines is very much to be welcomed. If the conclusions of a series of tests carried out in this way prove positive, then a method of treatment will have fulfilled the requirements of conventional medicine for verifiable and comprehensible operating mechanisms. The rush to embrace new, alternative therapies whose effectiveness is so far only partly proven is misguided. It would be more appropriate to test these new approaches and therapies fully and rigorously within the context of a tried and tested medical tradition, with a view to integrating those which prove successful into conventional medicine as soon as possible, so as to hold out to conventional medicine - which in the last few years has perhaps become too technical and equipment-oriented - the prospect of a more humane form of medicine, which views people as a whole and builds on their powers of self-healing.
Finally, I should like to refer to the financial aspect of this question. The treatments that we are all paying for dearly with our contributions must have demonstrably positive effects. We owe this fundamental quality assurance not only to patients, but also to taxpayers. For example, the president of the German Association of Health Service Doctors said in this context yesterday that it is unacceptable for all and sundry to practise Tibetan drumming or meditative Ikebana at the expense of the insured community as a whole, simply because they once did one insured person some good! That is not enough for them to be recognized as therapies and receive financial support.

Aparicio Sánchez
Madam President, not all members of the PSE Group share the views expressed by Mrs Roth-Behrendt, because many of us think that a progressive attitude to so-called 'alternative' medicines does not mean putting it above any other value of freedom of choice. That is an ultra-liberal attitude. On the contrary, we want to see a development of alternative medicines - progress, legislation on them, while guaranteeing, or at least protecting at all times, the health, safety and legal rights of ordinary people.
We do not think that the Lannoye report goes in this direction, on the contrary, and that is why we have tabled some amendments and we shall vote against certain articles and we will vote against the whole report if paragraph 2, for example, is kept as it stands. We go along with the defence of two basic principles: first of all, anyone wishing to exercise in the European Union one of the so-called alternative medicines should have a general medical training base and an official qualification guaranteeing that training. That qualification could be in medicine, but it could also be in naturopathy or homeopathy etc. But it must be a qualification issued by an academic authority rather than the current situation in which a so-called committee assesses the practitioner's qualification; secondly: the efficiency and, above all, the harmlessness of treatments must be assessed by scientific or academic institutions in the light of scientific, biological or statistical methods, etc., and by no means as a result of 'self-regulation' carried out by the profession itself, as the report would have it - this would be a step backwards.
These and other proposals are not compatible, in our view, with the scientific guarantees that European qualifications must offer nor with the safety of ordinary people, nor with the functioning of the European Parliament.
The history of medicine, like the history of mankind, is a fight between knowledge and beliefs: the more knowledge advances, the more withdrawn beliefs become. Will there come a day when medicine is an exact science? Obviously not. The final result will always be weak, because fighting death is the weak point of all of biological science. However, that must never be a reason for abandoning scientific bases founded on reason and knowledge.

Poggiolini
Madam President, all I would say, quite calmly and simply, is that this resolution would allow treatments typically performed by the medical profession to be carried out by persons who have not been trained on the basis of the European directives regulating medical school curricula, which have been established in order to permit the free movement of doctors throughout the Union.
Apparently, these therapists do not wish to practise medicine, but merely to be able to treat patients according to the principles of so-called alternative medicines, but there is no doubt that, by promoting direct access for European citizens to alternative therapists, these persons would also be entrusted with the very delicate diagnostic phase, without having the relevant training. The fact is that only once an illness has been identified, in other words after diagnosis, can the appropriate treatment be determined. Diagnosis is a basic task of doctors, and of doctors alone: an incorrect, over-hasty diagnosis of an illness that is curable by medical science - which, as is well known, has made tremendous advances in recent years - can often endanger the health and, sometimes, even the life of a patient.
An amendment tabled in committee, not approved by the rapporteur, calls for a study of the effectiveness and safety of alternative medicines to be carried out before any directive is issued. Naturally, many colleagues who are in favour of the resolution voted for this amendment because, despite everything, they are still not convinced of the effectiveness and safety of therapies which have not been scientifically verified.
Given the approval of this amendment calling for a thorough precautionary study of the safety and effectiveness of all non-conventional medicines, we are now faced with an absurd and contradictory resolution, Commissioner, because all the recitals and other paragraphs of the resolution itself are geared to obliging the Commission to allow so-called alternative medicine to be practised in all the Member States. I shall therefore vote against this resolution, as will my entire group, in the interest of the citizens of Europe, but also because I believe that in any event this matter falls under the principle of subsidiarity, which allows the Member States to make arrangements in keeping with their own customs and practices.

Kronberger
Madam President, Mr Lannoye's report makes us aware that the financing aspect of health is also very much at issue here, and that there are also some departments which do everything possible to ensure that they remain unchanged. I believe, however, that the systematic exclusion of therapies whose empirical effects can be recognized, but which cannot be explained or understood in traditional scientific terms, constitutes an unfortunate self-restriction on the part of conventional medicine.
I believe that recognizing complementary therapies would serve not only to protect patients from quacks and charlatans, but also to enrich conventional medicine with constructive new approaches and ideas. I refer, for example, to holistic treatments, which regard people as more than simply the sum of their parts. Traditional Western medical science would be in difficulties if it could not convince people through its high quality, but had to assert its position legally through a claim to be the sole legitimate representative.
All scientific claims to absolute right lead to totalitarianism, sooner or later. I therefore believe that we must adopt Mr Lannoye's thought-provoking report.

Malone
Madam President, I too want to congratulate the rapporteur. He has put in a lot of work since this own-initiative report was first referred to the Committee on the Environment, Public Health and Consumer Protection almost three years ago in October 1994.
As we know, complementary medicine is practised by thousands of people each year throughout Europe and it has been discussed at length at European level over recent years. Mr Needle said one in four people had partaken of complementary medicine and seen the benefits of disciplines such as shiatsu or - as in the case of my own mother where conventional medicine failed - received great relief from acupuncture.
Many practitioners of conventional medicine realize that traditional medicine has a lot to offer and reasonable, independent-minded people must realize that our whole future health and well-being undoubtedly lies in a good mixture of the two. I am asking the Commission to come forward now with a draft directive. There is a clear need for complementary medicine to be regulated legally and the professional qualifications of practitioners must be legally recognized. They must be allowed to circulate freely throughout the Union provided they meet basic standards.
The Commission is best placed to set out these rules. I would therefore urge Commissioner Flynn here tonight to come forward with a draft directive and I would urge Members to support the report and the amendments to which I have appended my name.

Heinisch
Madam President, I am convinced that non-conventional medicine can be of great use to patients. I take it as read that there is a need for action at European level in this field, but I would stress first and foremost that Community interference in the organization or contribution and reimbursement obligations of national health insurance schemes is unnecessary. In accordance with the principle of subsidiarity, dealing with these matters remains the responsibility of the Member States. As a practising pharmacist, I feel it is important that the report gives valuable impetus to the debate on the question of self-medication. There are calls for increased selfmedication in a great many countries, when health systems come under review.
Pharmacists must therefore come to grips with the question of self-medication and bring their knowledge to bear in consultations on the choice of treatment with so-called gentle medicines. In any event, they need to able to judge confidently the nature of the illness and the extent of the threat. Non-conventional therapies are based on the same natural laws as conventional therapies, but seek to stimulate the body's internal self-healing powers to a greater degree. It is also important to stress that the different types of therapy are not mutually exclusive, but complement one another.
It is extremely important for patients to be guaranteed a very high level of safety, and it must be ensured that they are given detailed information on the quality and effectiveness - and also the possible risks - of non-conventional therapies. It is therefore necessary to secure the highest possible level of qualification and a requirement to provide information. The level of Europe-wide qualifications must be as least as high as that already required for non-medical practitioners in Germany and Sweden. Furthermore, in the interests of patient protection, there is a need for compulsory liability insurance which is not of a lower standard than that required for conventional medical practitioners.
It has been my experience in the Committee on Petitions that we frequently discuss the recognition of diplomas at European level. And there is no indication in the Treaty that non-conventional medical disciplines should be excluded from such recognition. In the interests of securing cross-border mobility, the recognition of diplomas in this field must also be promoted. In general terms, it must not happen that the practice of a non-conventional medical discipline is prevented in a Member State because the profession does not exist in that country.
I also believe that, in an age of Europe-wide telemedicine and teleshopping, the existing study courses in medicine and pharmacy should be reviewed rather than harmonized, and I would likewise propose that courses in nonconventional medicine should also be offered at universities. I welcome Mr Lannoye's proposals for the Commission to draw up studies on non-conventional medicine, using them as a basis for any coordinating legislation, and for the Council and Parliament to encourage the development of research programmes in this field.

Ebner
Madam President, in following this debate, one sometimes gets the impression that one has read the wrong document. There is talk of witchcraft, and there are comparisons with the aviation sector. Engaging in polemics and trying to conceal matters or present them in a totally different light does not help matters, in my opinion. The point that different Member States have different regulations or problems is a reason for supporting Mr Lannoye's report, rather than an argument against it.
The ideological battle over this issue has rightly been condemned. However, it is not enough to condemn this battle if a colleague who does so then falls into the same error and rides roughshod over doctors. Our group has strong reservations and will vote against the report. However, a number of Members in our group hope that the Commission will finally carry out a thorough study of the safety, effectiveness and scope of non-conventional medicine and take steps towards harmonization. We hope that rules will be introduced in the interests of protecting public health, as well as in those of existing and perhaps future professions, not least in conventional medicine. For example, Mrs Oomen-Ruijten and I are of that opinion.
Although I am unable to endorse every paragraph and amendment, I broadly support Mr Lannoye's report, and I also fully agree with the substance of the comments made by Mrs Heinisch.

Matikainen-Kallström
Madam President, I should like to thank Mr Lannoye for his good report and for highlighting the problems associated with alternative medicine. Alongside conventional medicine, and in support of it, alternative medicine has developed. It should be borne in mind that conventional and alternative medicine are not mutually exclusive but in many cases, indeed, support each other, to patients' advantage. I have myself benefited from both of them.
However, the position and role of conventional medicine vary widely among the Member States. Different views are taken of alternative medicine. Trained chiropractors, for instance, have already acquired a legalized status in many Member States, such as Denmark, Sweden, Finland and Britain. Because of the differences of approach, it would be difficult to integrate alternative medicine as a whole into European social security systems. As Mr Lannoye observes, the position of consumers also differs greatly from one country to another.
In my view, treatments which do not form part of conventional medicine ought to be precisely defined, as should the levels of training required of their practitioners, so that, when choosing among treatments, patients know as accurately as possible what the various options are. It is important to harmonize legislation in order to determine the standard of training institutes for practitioners, to help new graduates find work, to supervise work and further training, and particularly to guarantee the effectiveness and safety of the care offered to patients.

Flynn
Madam President, on behalf of the Commission, I should like to compliment the rapporteur Mr Lannoye on the breadth and depth of his own-initiative report on non-conventional medicine. However, it would be only fair to say at the very outset that at this juncture the Commission cannot share all the report's conclusions.
The sphere of non-conventional medicine is at present a highly topical and emotive one. Discussions on this issue often give rise to strongly-held and conflicting opinions within and outside scientific circles. In fact, the difference of opinions and the diversity of attitudes which exist on this subject are very obvious even in the House this evening. This divergence of view is reflected, as the report itself points out, in the different approaches adopted by the legislation of the Member States. It is for this reason that the Commission feels that the time is not yet ripe for it to undertake the comprehensive study of non-conventional medicines and therapies which Mr Lannoye advocates.
In compiling reports of this kind, the Commission must rely on national data and policies to evaluate the need for action at Community level. But as we are so far from achieving consensus in this area, it is unlikely that such a study, if undertaken at this point in time, would be able to come to any decisive conclusions. Furthermore, given the very limited level of budgetary provision for public health programmes, we have, as you know, had to establish priorities for Community action and the severe constraints on our resources do not allow us to undertake other new commitments for the time being.
The report also invites the Commission to harmonize the conditions for the exercise of non-conventional medicine in the different Member States. In response to this specific request, I should first point out that the general system for recognition of diplomas, which has been in place for a number of years now, already guarantees free movement to practitioners between those Member States which recognize non-conventional medicine as a discipline distinct from conventional medicine.
As the recitals in the resolution point out, it is perfectly true that under Article 57 of the Treaty, the Commission could propose a directive which would provide for the creation in each Member State, subject to agreed rules on education and training, of one or more recognized professions in this field. But, in accordance with the Treaty, such a directive would require the unanimous approval of the Member States. I must be frank and say to the House that in view of the diversity of approach that I mentioned earlier, it is unlikely that any real progress on a proposal of this kind could be made in the foreseeable future.
On a more positive note, I should like to say that in relation to food supplements, the Commission in its Green Paper on Food Law adopted on 13 April 1997, announced its intention to initiate technical consultations as soon as possible on the need for and possible scope of Community legislation. Concerning pharmaceutical legislation for non-conventional medicines, the Community legislation in the field of medical products is based on the three requirements of quality, safety and efficacy.
The main problem for non-conventional medical products is the proof of efficacy. A special approach was taken with Directives 92/73 and 92/74 for certain homeopathic medicinal products, where a product was allowed to be marketed without fulfilling the requirement of efficacy. The Commission is prepared to examine the potential that this approach offers for giving effect to the views expressed in the resolution.
With regard to the specific issue in point 5 of the motion for a resolution, concerning budget line B6-7142 of the Biomed programme, I have to inform you that it was not legally possible to carry out the research projects referred to because non-conventional medicines are not included in this specific programme's objectives. On the other hand, in the case of budget line B6-8332, which is referred to in the preamble of the motion for a resolution, a report by a group of consultants dealing with research on homeopathy has been published in recent days. I have brought a copy with me for the honourable Members' information; other copies will find their way to Parliament through the normal channels.
Furthermore, the Commission has published a call for tender for a study relating to herbal medicinal products. A contract for this study will be granted shortly and it is expected that the results of the study will help the Commission in evaluating the situation and in developing possible proposals for specific legislation. Although the Commission feels that it will be some time before it is possible to provide a comprehensive response to all the many issues raised in this resolution at Community level, I am confident that Mr Lannoye's report will provide an important contribution to the debate which is already under way within many of our Member States.

Rübig
Do you intend to produce a green paper on this topic, Commissioner? The public very much needs information in this field. What form will future training standards take, and will it be possible to focus on new issues in the area of research?

Flynn
Madam President, it is not the intention at this time to propose publishing a Green Paper. The other matters referred to were dealt with in my reply.

President
Thank you, Commissioner.
The debate is closed.
The vote will take place tomorrow at 11 a.m.

Social aspects of housing
President
The next item is the report (A4-0088/97) by Mr Crowley, on behalf of the Committee on Employment and Social Affairs, on the social aspects of housing.

Crowley
Madam President, at the outset I wish to thank the secretariat of the Committee on Social Affairs and Employment, Nik Lane, for all his work and also the officials from my own group, Mrs Emma Petroni and Mr Denis Smyth. They have put a tremendous amount of work into what I consider to be a very important and vital report which deals with the social aspects of housing policy across the European Union.
I would like to convey to Members the ideology behind this report and also dispel any fears that some Members may have about it. One of the major arguments which erupted in committee when this report first came up for discussion was the question of subsidiarity. Through dialogue, negotiation and compromise with other groups in the committee and other interested parties, I have attempted to overcome their difficulties with certain areas. You will therefore find that there is no call in the report for a fundamental right to housing to be included in the Treaties. I had originally sought this, not least because of the imminence of the Amsterdam Summit.
However, the European Union already has some power with regard to housing. Under the European Coal and Steel Community, there is a specific budget line and a specific reserve for the granting of low-cost loans for the re-housing of coalminers and steel workers, and also for the renovation and re-development of housing in coalmining or steel regions. As Members know, the ECSC Treaty lapses in 2002. There is no reason why the European Union should not take over the powers of that Treaty. The Maastricht Treaty allows for us to do so and also to harness the reserves left in those budget lines and bring them back into use under a new European Union policy.
The human aspect of what we are dealing with is huge: 18 million people homeless in the European Union, supposedly the most wealthy economic bloc in the world. 13 million people live in inadequate or temporary accommodation. We are talking about nearly 10 % of the population of the European Union suffering because of the lack of a coordinated and proper policy towards housing. As well as that, one has to look at the unemployment figures. And yet despite the huge unemployment figures from the most recent information from the Commission, the number of people going into skills-based training is reducing every year. That means that possibly in five to ten years time there will not be sufficient skilled workers in carpentry, plumbing, building and so on to meet the demand.
We should look at this not in a negative but in a positive way, of Europe taking to its heart those who are most vulnerable in our society, living the true social model behind this European Union, to ensure that the wealth that is created in this Union will reach every citizen and that he or she will not be at an economic disadvantage because of barriers that are put in place by European decisions.
As well as that, we have an opportunity to create new employment and new training. As part of my research and discussions for this report, I met with the construction industry's federations across the Member States and they are willing to contribute financially towards a house-building programme in cooperation with the local and national authorities. I am asking that the European Union become involved as a expert facilitator to bring the best practices from every Member State to show how a sustainable housing development policy could work and also to instigate proper training and managements skills for the operation of those programmes.
Finally, on the matter of rural depopulation: this is a problem that can be overcome. In the last ten years we have seen a decrease in the rural population of Europe of 48 %. That has brought with it major problems for large urban areas where tenements have proliferated, where there are inadequate services, inadequate roads and schools and so on. This has brought social problems such as drug abuse and crime. By taking positive action, we can rehouse people in rural areas, re-vitalize rural communities and take some of the pressure off urban areas.
In conclusion, I would ask that all Members take to their hearts the ideology and the belief behind this. It is a People's Charter for a better Europe. It is showing that we can react to the real needs of every individual European citizen. I ask every Member to support it.

Waddington
Madam President, ladies and gentlemen, I should like to speak about one part of this report, namely the issue of homelessness. This is one of the causes and consequences of social exclusion. It is one factor of deprivation which, along with unemployment, poverty, social isolation and inadequate education and training, blights the lives of millions of European citizens. Homelessness particularly affects the young, the old and other vulnerable groups in society.
For example, in my own city, the largest single cause of homelessness is domestic violence, namely violence against women and children in their homes. Because homelessness is part of a complex multi-dimensional pattern of disadvantage, it requires a coordinated approach from public authorities, an approach which is sensitive to the needs and aspirations of the homeless, which takes account of the fact that homeless people need jobs, schools and health services and an income as well as a home.
That is the reason that the Committee on Employment and Social Affairs is calling for a Commission taskforce of relevant directorate-generals to develop integrated strategies to combat social exclusion. That is why we are saying that the homeless themselves and their organizations should be consulted about relevant European programmes. The major responsibility for the provision of housing lies with the relevant authorities of the Member States. If, however, the European Community is serious in its desire to build an inclusive society, Europe can add value to the work of Member States. For example, we could be using the structural funds. We could be unblocking the Council's veto on the poverty programme to explore new initiatives which address housing needs alongside the need for sustainable urban and rural development, skill training and employment.
We can create new pathways for the integration of those who are homeless and excluded. I hope that Mr Crowley's report, on which I congratulate him, will contribute to this process and that the pace of progress to build a social Europe will gather momentum in Amsterdam next month.

Pronk
Madam President, there is an expression in Dutch which says that the later it is in the evening, the more beautiful people become. I think this is certainly the case here, but I have to say that there are really very few of us to be discussing such an important issue.
The Commission recently published statistics on poverty in Europe which show that a considerable number of people live in relative poverty, in other words in comparison with the people around them. Of these one third are unemployed, one third are pensioners, and one third are in work. This means that a large proportion of these people are still fairly young. If we look at the figures for the homeless, we can see that more than half of them too are aged between 20 and 40. Most of them have worked at some time, usually in temporary or insecure jobs. So poverty and poor housing or homelessness tend to go hand in hand, and both can lead to social exclusion. This is why the fundamental right to decent and affordable housing needs to be put into effect through specific measures, first and foremost by the local and national authorities.
Last year at the Habitat Conference in Istanbul, the first steps were taken at international level to provide housing for all, and action now needs to be taken at local, national and global levels. The European Union's role could be to coordinate certain aspects of housing policy, and a European initiative such as a pilot project could be set up.
As regards the PPE Group's amendments to the Crowley report, I would stress that in the case of Amendment No 13 by Mr Mann, the German version is the original. This means that only technical support projects are to be covered, such as technical assistance in obtaining loans. It does not mean that housing projects themselves should be given European funding.
If the rapporteur is prepared to support our amendments, with this clarification, the PPE Group will vote for the report tomorrow. I should like to congratulate him on his work, which I think provides us with extremely striking evidence of why action is needed on a housing policy. The only question is who should take it, and how.

Mezzaroma
Madam President, Mr Crowley's report can be seen as an entirely satisfactory response to the problems connected with the social aspects of housing. Where I come from, in Rome, it is said that unless the construction sector recovers, the economy as a whole will not recover; so why not promote this sector across Europe, wherever it can provide a significant number of jobs? But quite apart from employment, housing also represents comfort and a focal point for the principal nucleus of society - the family. Every human being has a right to a decent, affordable home; indeed, certain families should be given one free of charge.
A home provides shelter from inclement weather. It serves as a meeting-place and base for those excluded from society. Homes are needed for the elderly, and family homes for the handicapped: just think how important it is to incorporate into our town planning - both old and new - family homes where handicapped persons can continue to live after the death of their parents.
Parliament and the Commission must pay more attention to this sector, which is so important from the social point of view. Obstacles exist, of course: there is inadequate funding. I am very familiar with the construction sector - I used to build houses before becoming an MEP - and I know that it is a depressed sector, a poorly supported one: the EIB does not yet fund building projects, the rules are still too complicated, and firms both large and small have difficulty in moving around Europe.
This problem will not be solved unless and until we find a proper solution to its financial aspects, without even mentioning the lack of planning.
The report touches on all the social aspects of the matter, as well as addressing itself to town planning in respect of housing. It is true that planning is essential to free people from the ghettos which would be created if housing were nothing more than bricks and mortar, for the use and abuse of speculators alone. Finally, Madam President, larger houses ought to be built, so that this old Europe of ours can have many children.

Boogerd-Quaak
Madam President, ladies and gentlemen, our group sympathizes with the sentiments behind this report, which expresses concern for those groups in society that need us to care for them. However, we in the Liberal Group feel that we cannot vote for it, because it expects far too much to be done at European level which we simply cannot achieve. For example, we have to disagree with recital B, which says that there is a general trend in the Member States towards the abandonment of their responsibilities in terms of housing policy. This and a number of other examples place far too much responsibility on Europe, and Europe simply cannot deliver the goods. There is also no legal basis for it, which is why we have said that we will not vote for the report. We would not oppose an action programme to encourage model projects, but this is the only thing we feel we can discuss.

Moreau
Madam President, more than 18 million people without a home or poorly housed in the European Union is an intolerable situation and one that is likely to get still worse.
That is one of the most dramatic consequences of policies based on financial profitability which, at the same time, scandalously encourage real estate speculation and increase unemployment, precariousness and exclusion. The implacable law of the markets applied to housing throws on to the streets millions of people - young people in particular - who are unable to find a stable job. The right to housing is a fundamental human right.
The report mentions some interesting proposals, such as measures against urban speculation or European funding of projects presented by Member States. But I think that an integrated European policy, as demanded by the report, is not a good solution - primarily because experience shows, alas, that most Community policies have lowered social standards because they are never based on the upper level.
I would also emphasize the fact that the Maastricht criteria and the criteria for the switch to a single currency have led to reductions in the financing of social housing construction and housing support. The problem of housing, which depends on each State, can be solved, however; all that we need is the political will to grant social housing the place and the means it deserves.
I should like to refer to three types of solution which might be food for thought. First of all, favouring the construction of housing at accessible prices, offering material support, lowering bank interest rates, taxing speculation. As for the homeless, the construction of social hostels where homeless people could seek shelter, and setting up housing centres respecting human rights and including social services so that the various problems posed could be dealt with.
Above all, we must find ways of halting the increase in the number of homeless. Therefore, the barbaric practice of evictions must cease, and must be banned when rent delays are have social reasons. Being thrown out on to the street is, in most cases, an irreversible step towards marginalization. Losing the roof over your head, especially for children, is terribly traumatic. Specialized committees could help people with rent payment problems and make them more responsible for their lives.
Finally, considerable aid must be given to charity associations whose support is vital, as they are devoted to alleviating the suffering of the least well-off and I would like to repeat the need to re-establish European credits in favour of the fight against poverty.
Trying to find solutions to solve the basic problem of housing means putting an end to the logic of financial markets and putting human beings rather than money at the centre of society.

Ojala
Madam President, in this House it is customary to congratulate rapporteurs on their excellent work. On this occasion, when I offer my congratulations, I do so quite sincerely. In this report, drawn up at the initiative of Parliament and the Committee on Social Affairs, Brian Crowley has very clearly demonstrated the central importance of housing policy as an element in social policy. Other employment and social policy measures are in vain unless people have decent housing from which to go out to work, in which they can bring up their children and where they can relax in their free time.
It has now become clear to us that there are enormous differences in housing policy between Member States. Some Member States spend as much as 3 % of their GDP on housing, others less than 1 %. It can also be said that housing policy has been shamefully neglected at Community level. It is not too late for us to seek the insertion in the Treaties at the Amsterdam summit of an article on social policy which would create the legal basis for common housing policy measures. There is a challenge for us here in the weeks ahead.

Flynn
Madam President, on behalf of the Commission I should like to thank Mr Crowley for his report and all the Members who have contributed to the debate. While we are all rightly concerned with the problems caused by homelessness, there are strict limits on what the Commission can or seeks to do in this field. Fundamentally, housing provision is a matter for the Member States and the Commission does not believe it has any significant role to play in the physical provision of housing.
Mr Crowley's resolution suggests that European low-cost housing loans could be modelled on the example of the ECSC. Certainly this was a programme which brought great benefits in its day but these loans are less relevant now than they were. Indeed, demand for them has fallen in several of the Member States, to the extent that part of the funds allocated remains unclaimed. The scheme is, in fact, being wound up at the end of this year.
The structural funds have been cited as a potential source of housing finance. This has not been the case in the past, although the Urban Community Initiative has, for example, focused on areas of housing deprivation. Whilst I do not know what the Commission will propose in the context of the post-1999 reforms, I wonder whether lowcost housing loans can really be given priority over, for example, our employment needs.
However, on a more positive note, while the Commission is unable to finance housing as such, it tries to contribute to efforts combating homelessness and the social effects of poor housing. We fully agree with the emphasis which the resolution places on the need to adopt an integrated approach to resolve the complex web of economic, social and cultural problems that are their root cause.
An excellent example of this integrated approach was the Poverty III programme which promoted multiagency approaches to tackling poverty. This programme supported a wide range of housing-related projects which range from improving shanty towns in Greece to aiding the regeneration of run-down social housing areas in Edinburgh. Indeed, housing action of some sort was involved in almost three-quarters of the projects that were supported.
Mr Crowley's resolution also mentions the IGLOO initiative. The Commission has already provided support to help establish this European network and I would very much hope that we can continue to support this type of activity in the future. I should like to thank Mr Crowley for his thoughtful report. The Commission will consider his proposals with due care and the material from the Member States is worth studying.

President
Thank you, Mr Flynn.
The debate is closed.
The vote will take place tomorrow at 11 a.m.

European Information System - Information technology for customs
President
The next item is the joint debate on the following reports:
A4-0062/97 by Mrs Terrón i Cusí, on behalf of the Committee on Civil Liberties and Internal Affairs, on the draft Council act (12029/94-9277/1/95 - C4-0249/95) drawing up the Convention on the establishment of the European Information System (EIS); -A4-0060/97 by Mr Schulz, on behalf of the Committee on Civil Liberties and Internal Affairs, on the Council Act (C4-0248/95 + C4-0520/95) of 26 July 1995 drawing up the Convention on the use of information technology for customs purposes, the Convention drawn up on the basis of Article K.3 of the Treaty on European Union on the use of information technology for customs purposes and the Agreement on provisional application between certain Member States of the European Union of the Convention drawn up on the basis of Article K.3 of the Treaty on European Union on the use of information technology for customs purposes.
Terrón i Cusí
Madam President, first of all, I would like to thank all groups for the cooperation which they demonstrated in the Committee on Civil Liberties and Internal Affairs and their very good will towards this report. I should also like to thank our Swedish colleagues for the patience they have shown, as they had their language version of the convention to which we are referring very late in the day. They had to start work on the English language version, until the Swedish translation finally appeared, so that we could discuss this report.
Today, Madam President, the Council and the Commission have explained to us the progress made at the Intergovernmental Conference, including progress on the free circulation of persons, one of the aims of the Union which is still far from being attained. This debate could not be more timely.
We are speaking today of a convention presented to us by the Council, establishing the European Information System, in order to replace the Schengen Information System. Today, I am not going to enter into details of the experience of the Schengen Information System, which we approved a long time ago, but I would refer to the report by Mrs van Lancker on that subject. I should like to focus on what seems to be the basis of my report: the request for a change to the legal basis of the establishment of the European Information System.
The Council has presented us with a convention based on Article K.3 of the Treaty on European Union. Article K.3 refers to Article A.1 of the same Treaty and Article K.1 specifically refers to the crossing of external borders, immigration policy, the policy on nationals of third countries, judicial cooperation, both civil and criminal, customs cooperation and police cooperation for the purposes of preventing and combating terrorism, unlawful drugtrafficking and other serious forms of international crime. However, the EIS covers a completely new area since its main purpose is to provide a compensatory measure in relation to the free movement of persons and the abolition of internal borders, an area in which the Community has exclusive powers on the basis of Article 7.A of the EC Treaty. The same Article K.1 of the Treaty on European Union provides that the cooperation described in Article K.1 will apply without prejudice to the powers of the European Community. Because of the exclusive Community powers, one would have expected Community rules, and that is exactly what we are proposing for the EIS.
The European Parliament has already expressed itself on various occasions to state that, bearing in mind that the free movement of persons should already have been achieved since the approval of the Treaty of Rome, in other words, virtually 40 years ago, controls on persons at external frontiers ought to be regulated in the same way as controls on goods. If we look at the content of the European Information System it is even clearer that Community legislation is called for. There is no doubt that the EIS concerns police cooperation, but not specifically in the fields of terrorism and unlawful drug-trafficking, nor other forms of international crime.
The main aim of the EIS is to sight and monitor the movements of persons wanted nationally, and control the whereabouts of persons subjected to national control, as this is no longer always possible at national level because of the removal of internal borders. In other words, as I said before, the main purpose of EIS is to provide a compensatory measure in relation to the free movement of persons. Changing the legal basis and using a Community regulation would offer many advantages, such as satisfactory consultation of the European Parliament over a subject for which there are not even any guarantees that national parliaments can effectively exercise their control. That would also enable this approach to be applied rapidly. I think that experiences such as the Schengen Agreement and Dublin Agreement make us fear the worst. Sometimes we have taken over ten years to reach an agreement. The Commission also needs a clearer role. In Community jurisdiction on a subject concerning personal data, the Court of Justice and Court of First Instance ought to be able to intervene when, for example, citizens are making claims or when a uniform interpretation of the convention is needed.
As it stands at present, the EIS Convention is linked to the so-called External Frontiers Convention. At no point is any sound reason given for this link and, in my opinion, nor is there any reason for making such a connection because the main purpose of the EIS - as I have already said many times - is to compensate for the lack of checks at internal borders. Checks at the external borders will be carried out come what may, regardless of whether there is an External Frontiers Convention. It is not easy to see why the setting up of the EIS has to wait until the conflict between Member States and the External Frontiers Convention has been resolved. A regulation, on the other hand, could not be subjected to a convention established on the basis of Article 6 of the Treaty.
Coming to a more practical point, I think that everything to do with refugees and persons asking for visas should be looked at carefully. It is dangerous that, as long as there is no approximation in this field, this subject should be included in the system, because anyone seeking asylum and having that request rejected could end up being included in the category of undesirable foreigners. I think that that is sufficiently serious for us to do everything that we can to stop it happening. I think it is unbelievable that the only thing that was specifically mentioned, before this convention was completed, was the fight against illegal immigration. I think that we should change that number by controls on immigration.
There is other minor information that I would like to see changed in the convention, but I wanted to focus what I had to say on the change of the legal basis which we are asking for. I think that, if that is done, it would be proof that what the Council tells us here sometimes is something more than just good words, something more than goodwill, and that there really is a political will to head towards the aim of the European Union, i.e. achieving the free movement of persons.

Schulz
Madam President, ladies and gentlemen, I should like to follow on from what Mrs Terrón i Cusí has just said. In doing so, I shall refer to another information system that is due to be set up in the European Union: the Customs Information System. The purpose of this system is to assist in pursuing serious contraventions of national laws in the customs sector. Its aim is to enable customs authorities to acquire and exchange as rapidly as possible the information necessary to combat serious crime, with a view to increasing the effectiveness of their cooperation and control procedures with regard to the transport of goods, the treatment of transport companies, the various means of transport, fraud and organized crime. It is also designed to enable them to improve their strategies for combating organized crime through the dissemination of this information.
Within the framework of this information system, the intention is to address the kind of cross-border organized crime now developing in the European Union, to draw up studies and make these available to the national authorities. Naturally, this will only be possible if information is also gathered on the persons committing the crimes - in other words, this information system will also contain personal data.
So far, so good. That is the right and sensible approach, and Parliament must support the Member States' authorities - not only the customs authorities, but all the other national authorities involved - in their efforts to step up the fight against crime in this area, which is constantly on the increase; and we support all efforts to set up the necessary information systems to this end.
What we cannot support, however, is that in the process of establishing this information system and putting it into operation, in the legislative process that is necessary to bring the Convention into force, Parliament should as usual be sidelined. Article K.6 of the Treaty on European Union provides for the European Parliament to be consulted on measures such as the setting-up of a customs information system. What did the Council do? It signed and adopted the Convention - and I would urge the House to note this carefully, since this is the Council's customary way of doing things - before its text was forwarded to Parliament in all the official languages. In other words, the Members of this House - not many of whom are present here tonight, which I can well understand - had to deal with this project by first having to fight to obtain copies of the necessary document in their respective official languages.
Moreover, Parliament must also note the fact that the process of consulting it - which in theory should be taking place tonight - is completely worthless, that everything we say tonight is completely pointless and meaningless, since the Convention has already been forwarded to the national parliaments for ratification.
This issue concerns the establishment of an information system which could include data on every single citizen of the Union, since the Convention contains passages which provide, for example, for the operators of the future European Information System to cooperate with all national authorities which could be involved in the collection of the data for this information system, without it being defined which national authorities are meant by this, or how these national authorities are supposed to transmit the data concerned to the Customs Information System.
In any event, it seems that nothing less than a race to set up information systems has broken out in the European Union, with a continuing disregard for the right of the freely elected representatives of the people of Europe to be involved. Mrs Terrón i Cusí has just told us about the European Information System; I am speaking about the Customs Information System; there is the Schengen Information System; and Europol has its own information system. These different systems sometimes process data collections which duplicate each other and overlap. In future, it will only be possible for a European citizen to avoid being included in an information system by residing outside the European Union - but not in one of the applicant countries of Central and Eastern Europe, since they are cooperating intensively in the establishment of the European Information System. This is what distinguishes the applicant states from the European Parliament. The Polish Minister of the Interior undoubtedly knows more about the Customs Information System than Parliament's rapporteur - I can assure you of that. The same is true of the other information systems, moreover.
The idea has been floated of creating a single, vast information system combining the customs, European, Europol and Schengen information systems - a sort of information Big Brother, outside the control of national parliaments and the European Parliament. The directors of such an information system would have a great job. They could collect whatever data they liked, without having to account to anyone for what they did with it.
If a Member of this Parliament, as an individual citizen of the vast legal area that is the European Union, happened to come into contact with such an information system and objected to the data held on him there, he could not bring a complaint before the European Court of Justice, because - surprisingly - the information system would be outside the ECJ's jurisdiction.
Following that broad description of this highly undemocratic situation, let me make the following basic comment: anyone who wishes to enlist the support of the EU's citizens for the marvellous European project for the future which could help to alleviate the difficulties in the European Union, anyone who wishes to encourage the EU's citizens to take part in this project, must make them feel that they live in a democratic legal system. It is unacceptable that in setting up information systems such as those I have been describing this evening, the aim of which - fighting organized crime effectively - is undoubtedly a good one, the fundamental requirements of democracy should go unobserved, and civil protection and the lawful establishment of the legal foundations should not be guaranteed.
And they will not be guaranteed, if Article K.6 of the Maastricht Treaty is constantly trampled underfoot! If that is the case, we shall be unable to persuade the EU's citizens that it is a good thing to take part in the Union. And I shall tell you why: it may well be that ordinary citizens - who, tonight, if they are German, are celebrating Borussia Dortmund's victory over Juventus - are not interested in the Customs Information System and do not care if the European Parliament, the German or any other national parliament deals with it - and I am sure that that is the case. But when they see, in the long term, that the European Union's entire legislation in the field of internal security is no longer being debated by national parliaments or the European Parliament, when they see that systems are being set up which can intrude in their daily lives without our citizens being able to have a say in how they are established, then I am quite sure that mistrust of these bodies will grow, instead of the trust they need in order to be able to combat those who pose the greatest threat to the development of the European Union - apart from the Council of Ministers, which, if it continues in this way, will be in permanent danger of being criticized for being an undemocratic institution. What really poses a threat to us is organized crime, which it must be the aim of all these bodies to combat. However, they will only be able to do so efficiently and effectively if their action is placed on a genuinely democratic footing.
Unfortunately, however, that is not the case. I regret to say, therefore, that we must make clear with this report that, once again, a project which is actually a very good one is being laid open to dispute, and will remain open to dispute in the process of ratification by the national parliaments - as is currently the case with Europol - because the Council, in its infinite wisdom - which, tonight, I shall for once describe as arrogance - failed to consult Parliament in good time.

Bardong
Madam President, ladies and gentlemen, I should like to refer mainly to the opinions of the Committee on Budgetary Control on the Convention on the use of information technology for customs purposes and the Convention on the establishment of the European Information System - the reports on which have already been introduced.
Cooperation in the customs sector raises the question of demarcation between the first and third pillars, and thus concerns a variety of competences. It involves administrative cooperation between the Member States' authorities, and their collaboration with the Commission in areas of Community competence. The result is that merely the exchange of information in the customs sector has two different legal bases, which hardly serves the purpose of improving cooperation between customs administrations.
We are therefore faced with a somewhat misleading title and, above all, an objective which does little to encourage integration. The Commission will simply be responsible for managing the system's technical infrastructure. Moreover, the Convention establishes no links with other Community databases - some of which have already been mentioned, such as SCENT or IRENE - the database for the fight against fraud, or the IDA proposal to facilitate the smooth functioning of the single market. The protection of the Community's financial interests is therefore not taken specifically into account.
The customs authorities are required to prevent and combat offences against both Community rules and national laws. So in the most complicated way, the expenditure for this system will be included in the Community budget and borne by the Member States. Under the terms of the TEU, the exchange of customs information must be set within the framework of the EC Treaty. Unfortunately, however, the Council has given in to the wishes of certain Member States and placed the Convention within - or let it drift into - the intergovernmental sphere. The artificially perpetuated hovering of this Convention between the intergovernmental and Community areas can, in my view, do nothing to promote the campaign against fraud and the protection of the Community's financial interests.
The paragraph in the motion for a resolution calling on the Commission to determine whether the system could be regulated under the EC Treaty by means of a directive or a regulation raises this problem only tentatively. The Convention on the establishment of the European Information System is also designed to improve the effectiveness of controls - this time on the Union's external borders - especially through the dissemination of information on persons or objects being sought.
Its purpose - and this has already been pointed out - is to transpose the Convention implementing the Schengen Agreement, which was signed by certain Member States as long ago as 1990 outside the framework of the EC Treaty. The European Information System will be funded solely from national contributions. There is no provision for any kind of links with the Commission's services - such as the anti-fraud unit - or access by Commission officials to the data in the information system.
These information systems are necessary and important. I too would recognize that. However, I have to say with disappointment that this is certainly not the ideal way to draw up Community legislation or create Community facilities. These systems will continue to be set up in parallel, and then isolated from one another. That is not what we want or need! Unfortunately, it cannot be said that the Intergovernmental Conference will produce any relief either, though that is a popular term there - at least, not yet, I am sorry to say!

Schaffner
Madam President, ladies and gentlemen, when the Committee on Legal Affairs and Citizens' Rights delivered its opinion on the convention on the establishment of the European Information System, it had at its disposal only a draft convention dated December 1995, which was still being examined by the Council of Ministers.
The Parliament's involvement in the framework of Article K.6 is an imperfect one and depends on the goodwill of the Presidency. It is not accompanied by the jurisdictional guarantees that characterize the European Parliament's participation in the legislative process, pursuant to Article 138.B of the Treaty. Article K.6 of the TEU provides for Parliament to be informed and/or consulted by the Council Presidency in the framework of Chapter 6. The letter by which the French Presidency forwarded a draft EIS convention to the European Parliament was informative rather than consultative. Nevertheless, the European Parliament decided to deliver an opinion.
The aim of this Convention is set up the means and even the conditions prior to the free movement of persons. The EIS Convention is an instrument of the Convention on Crossing External Frontiers of the Member States of the European Union. These two conventions are very closely interlinked.
Police and judicial cooperation set up by the EIS Convention between Member States with a view to rapidly disseminating information on persons being sought, under surveillance or to be arrested, with legal guarantees established by the convention, should make it possible to make progress towards the aim of the free movement of persons.
On the other hand, the Schengen Information System is the model on which the EIS is copied. On this model, the EIS comprises two parts, a national part, and the separate technical support function. This 'twin-arm' system inevitably has the disadvantage that each Member State will apply two separate laws: its own law and that of the Convention. The problem will, in all likelihood, arise in respect of the reporting procedure laid down in Article A.4.
Whereas the welter of international instruments involved in the Convention is proof of the importance of the questions dealt with, our committee fears that this interlink creates a supplementary factor of complexity which could mean that implementation of the EIS Convention will infinitely be delayed. Similarly, our Commission regrets that questions concerning the Court of Justice are dealt with separately. If they had been integrated that would have strengthened the legal security of the Convention when it comes to be applied.
Finally, to conclude, I should like to say personally that I strongly regret the fact that the Committee on Civil Liberties and Internal Affairs should not have thought it appropriate to consult the Legal Committee when its rapporteur considered changing the legal base. If, as is quite probable, the questions of crossing borders and immigration etc. are dealt with and communitarized at the Amsterdam Summit, it will then be necessary to transform the Convention into a regulation, but not before conclusion of the IGC - that was a little bit premature.

Cederschiöld
Madam President, judging by all the empty seats in the House it would appear that our citizens are not all that 'worked up' about these technical issues. So, looking at all the interpreters around me, I would like to say a special thank you to those of you who are struggling with us at this late hour when so many are absent.
But the subject does have important political implications. Our people must be able to feel safe in Europe. Criminals adapt to the new common order quicker than the legal system does. A Europe which does not have an effective system of combating crime or which has a feeble legal system will not win the wide, popular support needed to develop it sufficiently to ensure that people's hopes and expectations, in securing freedom of movement for example, can be fulfilled.
Free movement through the abolition of internal borders requires compensatory measures in the form of the EIS, primarily at the external borders, to make border controls more effective. It is essential for Member States to keep each other informed about items which have gone missing or fake items in circulation as well as about missing persons. As for criminals, information about them could be registered where there is good reason for supposing that they are about to commit a crime or where they have committed very serious crimes.
The fight against crime within the Union is based on the dissemination of information between the national authorities. There are currently four information networks. Of course there are some differences between them, since they all have different objectives; after all nobody wants a 'Big Brother' attitude in Europe. For this reason we need to be cautious about huge information networks. There must be clear restrictions surrounding the collection of information, but vital information relevant to a particular case must be included, otherwise it can never be a key instrument in the fight against crime and it has no other function to fulfil. At the same time any irrelevant information, and irrelevant information cannot be avoided, must be treated with great care and held at the lowest level possible.
We regret that the Council has taken so long to produce translations. Obviously, Parliament cannot adopt a position on a draft law which is not available in every language, which is why the Council's action could be taken as an indication of how much the democratic process in Europe is being eroded. Had the matter been raised under Article 235, the Council could have avoided the current unpleasantness. So we have put forward several amendment proposals intended to follow up formally on this position. Mr Bardong expounded the PPE group's view on these issues from a constitutional point of view so well that I will skip that section and simply point out that it would be of value if they are ultimately included within the framework of the Union.
In conclusion I would like to quote Mr von Wogau's words from the Committee on Economic and Monetary Affairs and Industrial Policy to the Committee on Civil Liberties and Internal Affairs. He states the following: ' The Convention creates the information system necessary through the Convention on Controls on External Frontiers, gives concrete reasons for greater co-operation in the legal sector and for police and customs co-operation, facilitates an improvement in the safety of people (and objects) on the Union's territory and contributes to the removal of barriers to the proper performance of national economies: the fight against the criminal economy, illegal trade of all types (narcotics, weapons), terrorism, criminality, crime and the embezzlement of capital.' Then we hope that this convention will be quickly ratified so that people can move freely. The broad consensus shared by both committees ought to be converted into practical action as soon as possible and be viewed as an important step towards freedom of movement.

Kinnock, Neil
Madam President, I would address the reports first by referring to Mr Schulz's report and then to Ms Terrón i Cusí's. On behalf of the Commission, I should like to thank Parliament for the significant work undertaken in various committees on the convention on the use of information technology for customs purposes. As the House will know, the aim of the convention on the customs information system is to create a database containing operational information on sensitive matters such as illegal drugs, weapons, pornography and so on which are currently outside the Community's legal competence for use by the customs administrations of the Member States.
As the House will also know, in parallel with this convention, a new regulation on mutual assistance and administrative cooperation in customs and agricultural matters was adopted by the Council on 13 March last. Clearly, therefore, the CIS under the convention is complementary to the CIS under the regulation. Obviously the Commission has no right of initiative in the field of customs cooperation under the third pillar.
Having regard to the link with the CIS under the above-mentioned regulation, however, the Commission will also manage the technical infrastructure of the CIS under the convention, whilst having no access to the data contained in this system. The House will also be aware of the Commission's active interest in the fight against fraud and the Commission believes that reinforcement of customs cooperation among the Member States, particularly through the use of computerized systems, significantly contributes to the effectiveness of those efforts.
Our practical experience is that the aspects of organized crime which the customs administration have to deal with cover, without any possible distinction, both first and third pillars. That is why the Commission, while respecting the legal constraints deriving from the Treaty of Union, has pushed very hard for operational customs officers to make technical use of the single computerized system. The CIS convention obviously falls within this framework.
To summarize, therefore, whilst the technical infrastructure used for the CIS under the regulation will also be used for the CIS under the convention, in legal terms there will be two different systems in accordance with the pillar structure of the European Union. The Commission agrees with the guidelines of the report made by Mr Schulz. However, whilst noting the various references made to the Commission in this report the House will know only too well that the Commission has no right of initiative in this area and has to take account of the pillar structure of the European Union.
Of course the issues raised in Mr Schulz' report could be resolved in the framework of the Intergovernmental Conference and I know that this Parliament and the Commission are in accord on that matter. I would, therefore, invite Parliament to continue to support the transfer of the administrative aspects of customs cooperation which are currently under Title 6 of the Treaty from the third pillar to the Community's sphere. Of course the penal and judicial aspects of customs cooperation should and would remain in the third pillar. But, as Members of the House and the Commission have argued, there are common advantages in administrative customs cooperation and change would consequently provide general benefits, without compromising the distinctive interests of Member States.
I commend the report to the House and I thank Mr Schulz and his colleagues for their useful work.
I now turn to Mrs Terrón i Cusí's report on the European Information System. I must say that the Commission shares the rapporteur's concern that the EIS Convention is deadlocked in the Council of Ministers and our disquiet is all the more marked because of the clear link between the EIS Convention and the Convention on Controls on External Frontiers. The Commission also agrees with the rapporteur's suggestion that the European Court should also become involved in matters relating to the conventions under Article K3.
I will take the opportunity in this debate to clear up a few misunderstandings which have become evident. Firstly, the European Information System (EIS) will replace the Schengen Information System (SIS). We will therefore just have one system and not two. Secondly, the Eurodac System is about the possibility of taking fingerprints in the case of asylum-seekers and has to do with the implementation of the Dublin Convention. Thirdly, CIREA and CIREFI are not information systems, they are working parties in the Council of Ministers. The Commission has pointed out on several occasions that the term 'Centre ' in both these titles could lead to misunderstanding so I emphasize that in this case Centre refers to groups and not to places. I trust that is crystal clear.
I agree with the rapporteur that we have to be careful to avoid an overlap between different information systems in the future, for example with Europol systems. At the same time the Commission is convinced that the introduction of the EIS system will lead to clearer and more rational information systems and, who knows, one day it may lead to clearer and more rational hours of debate for this Parliament.
In closing I would like to make a general comment on an institutional question which runs like a common thread through both the reports which are being debated tonight. Ms Terrón i Cusí suggests that the EIS Convention might be converted into a regulation. I have to say to her, however, that it is doubtful whether it would be possible to apply Article 235 of the Treaty in practice since, like Article K3 it requires unanimity in the Council.
The questions we have been discussing here tonight show that it would be much easier if we had a common legal framework. That is why the Commission proposed to the Intergovernmental Conference that everything in Title 6 with the exception of police cooperation and judicial cooperation should be transferred to the first pillar. Such a change in the Treaty would facilitate our work on both the EIS and the CIS and provide plain benefits for the Community and for its people. I hope therefore that Parliament will continue to give support to the Commission's proposal in the IGC and I also hope that the results of the Intergovernmental Conference and the new Treaty will mean that our common desire for greater efficiency can become a reality. I am grateful for the work done by Ms Terrón i Cusí and her colleagues in a report that gives further substance to the case for progressive change.

President
Thank you, Mr Kinnock.
The joint debate is closed.
The vote will take place tomorrow at 11 a.m.

Air carrier liability in the event of accidents
President
The next item is the recommendation for second reading (A4-0172/97) on behalf of the Committee on Transport and Tourism, on the common position adopted by the Council (C4-0092/97-95/0359(SYN)) with a view to the adoption of a Council Regulation on air carrier liability in the event of accidents (Rapporteur: Mr González Triviño).

González Triviño
Madam President, first of all I should like to thank all of those in the Committee on Transport and Tourism for their work, dedication and cooperation so that this duty could be performed. I should also like to thank the Commission for the sensitivity that it has shown to the amendments tabled by the European Parliament and its willingness to accept the Parliament's opinion. I should also like to thank Mr Sánchez, who was a Member of the European Parliament for two years and began this process.
In recent years, air transport has taken on considerable, unprecedented importance in the countries of the European Union, as a result mainly of the following factors:
First of all, higher incomes which have made this means of transport more accessible.
Secondly, liberalization and competition measures within the European Union, which have slashed air fares.
And finally, technological progress which has made it possible to use aircraft more intensively, increasing capacity over the last 20 to 40 years. The result is that, in recent years, the number of air passengers in Europe has been going up by almost ten million a year. The latest figures from the Association of European Airlines indicate that there are now more than 150 million air passengers a year. This is a very high figure, which clearly shows that air transport has become a system regularly used by a large proportion of the European population.
However, in the field of insurance cover for air carrier liability, this is still covered by the provisions of the Warsaw Convention and the Hague Protocol which, now more than 40 years old, are very antiquated, for obvious reasons. Logically, the same criteria for insurance protection in a system of transport initially regarded as very risky and used by a minority of the population can no longer apply. We have reached the absurd situation in which passengers using air transport have poorer coverage and protection than road passengers, despite the fact that statistics show that air transport has become the safest of all existing forms of travel, with an average number of deaths of approximately 700 persons a year.
A study carried out by the European Commission shows, for example, that an incident of a 40-year old manager dying in a road accident could result in damages of 650, 000 ECU, whereas his or her death in an air crash would lead to compensation of 30 times less than that. This is due to the fact that the maintenance of minimum guarantees stipulated in the Warsaw Convention is still the international norm, except in cases of airlines whose countries have approved separate national standards.
On the other hand, it is quite obviously unfair that no measures have been taken to uniformize the level of coverage received by all citizens of the European Union. That is why the Commission's initiative is a laudable one, and that is the one which is being submitted for the European Parliament's consideration today.
The debates and exchange of opinion in the Committee on Transports and Tourism showed that there is unanimity among the various political groups in backing the Commission's initiative.
The main aspects of the regulation are the following:
First of all, to waive all financial limits of liability where the airline is at fault for damages suffered by passengers in the case of injury or death.
Secondly, even if carriers can show that they took all measures to avoid damage to passengers, liability is set at the equivalent of 100, 000 ECU for each passenger. Furthermore, it lays down provisions for advanced hardship payments to victims to offset their most pressing economic needs or those of their beneficiaries. It is important to point out that the adoption of these protection measures for air passengers does not necessarily mean any considerable increase in transport costs, since the cost of insurance premiums varies from one to three thousandths of air companies' costs. It should also be mentioned that passengers in the European Union flying in planes belonging to carriers registered outside the European Community will have a lower degree of protection. It should also be pointed out that the regulation obliges non-Community carriers to inform their passengers of their degree of insurance coverage, i.e. lower than that existing in the European Union, at the time of ticket purchase. It is predictable that once this regulation is enforced higher levels of coverage will be extended to all air users, as many of these concepts have already been adopted by a number of world airlines in the inter-carrier agreements on passenger liability, voluntarily approved in Kuala Lumpur, in October 1995, covering already a total of 83 major airlines.
It should also be pointed out that the Legal Committee of the International Civil Aviation Organisation has just completed its proposal to revise the Warsaw Convention, to be put later this year or at the beginning of next year to the diplomatic conference of that Organisation. If, as is foreseen, the Council has to consider the content of the text that we are debating here in order to meet international standards in this field, we hope and desire that the final text will be submitted again for consultation by the European Parliament.

Megahy
Madam President, there have been a lot of changes between the first and second readings. But one thing remains the same. The debate seems to be taking place at about ten minutes to midnight. Those of us who travel regularly by air have seen year-on-year the increased number of passengers at our airports. Fortunately the risk to most of these air passengers from transport accidents is extremely low and I certainly took great comfort from the impressive statistics which the rapporteur produced to prove that. But when disaster strikes, there needs to be an adequate system of insurance protection which entitles consumers to full and fair compensation and gives access to funds within a short time to meet urgent commitments.
This regulation helps considerably in this respect and represents a big step forward in consumer protection within the EU. It is one on which there has been a very considerable amount of accord between the institutions and also between the Members of this Parliament. Up to now the obligations of air carriers, as the rapporteur said, have been governed basically by the 1929 Warsaw Convention. That is quite old - in fact, it is as old I am and that is quite old. Obviously this needs updating and many of the voluntary agreements amongst the European and other airlines have recognized this. The regulation brings these together and improves them considerably.
The original proposals which the Commission put forward have been greatly strengthened by the amendments carried in the European Parliament in the first reading, as, indeed, the common position of the Council indicates when it states that it takes on board most of these amendments, most of them supported by the Commission itself. The Committee on Transport and Tourism and the two rapporteurs can be well pleased at a job well done.
I particularly welcome the fact that the regulation waives all financial limits of liability, where the airline is at fault. This is necessary to keep pace with the vastly increased amounts being granted by the courts in these circumstances. Even in the case where the carrier did everything to avoid an accident, there is now to be a strict level of liability and in fact, there are also proposals for advance payments in the case of death. These are very much needed and have been a strengthening of the regulation. Of course these provisions apply only to European Union airlines, but, I am pleased to say, that non-Community carriers are obliged to inform passengers of their conditions when they purchase their tickets.
Finally, as I said, this is an improvement. But as European passengers are flying more and more outside Europe and new, and sometimes dodgy, airlines spring up, we must do everything we can in the way of striking new agreements with other parts of the world to see that this protection for air passengers is extended even wider.

McIntosh
Madam President, I regret that a matter of such sensitivity to air travellers is taking place at such a late hour. But I would like to thank everybody for staying on this evening, especially the interpreters and, obviously, the Commissioner, as well as fellow speakers.
The Group of the European People's Party welcomes the Commission draft regulation and I would like to congratulate Mr Gonzalez Triviño, the rapporteur, on his work in this regard. It is important to recognize that the common position reflects the main objectives of the proposal. Its main points are extremely important: to update the levels of liability for the carriers, recognizing the lower risks involved in air travel today but the higher level of damages paid to victims in transport accidents. It is important to waive the financial limits of liability where an airline is proved to be at fault but to impose a strict level of liability up to the equivalent of 100, 000 special drawing rights.
The most important thing is that non-EU carriers must inform passengers of their conditions of carriage at the time of purchase of the ticket. The situation in Europe today is regrettably very fragmented and in this regulation and our comments on it we should emphasize the need for uniform interpretation of liability. The proposed regulation is therefore extremely welcome in this regard.
My group will support the amendments with the exception of Amendment No 4 by Mr Wijsenbeek. We believe that the original text is better and stronger. We commend this proposal to the House and we are particularly grateful to our rapporteur Mr Gonzalez Triviño for the excellent work and for the Commissioner for his patience in being with us here this evening.

Jarzembowski
Madam President, Commissioner, since we are all in agreement, I should simply like to make two brief points. I am somewhat disappointed that the Council did not agree to the Commission's proposal that the regulation should enter into force six months after publication, but has extended that period to one year. I appreciate that airlines have to prepare themselves, but I preferred the Commission's proposal to the effect that six months are sufficient. That would clearly have improved passenger protection and would have been better.
Commissioner, perhaps you should say something about one of Parliament's amendments which I regard as particularly important. Amendment No 4 by Mr González Triviño calls on the Commission to ensure, in all future civil aviation negotiations with third countries, that those countries introduce liability rules in the interests of passengers that are similar to those laid down in the regulation. You know that the Council frequently makes life difficult for the Commission in its negotiations with third countries. We are therefore asking that legislation should be adopted to ensure that action is taken in the context of such negotiations. Ensuring that European passengers have the same rights of protection when they fly with non-Community airlines is presumably a concern that reflects both our views. If we decide this jointly, Commissioner, if the Commission supports this request, the Council will create fewer difficulties for us. And, above all, it will create fewer difficulties for you. I would therefore ask you to comment on this particular amendment by Mr González Triviño, and to accept Parliament's proposal that this issue should be incorporated into all negotiations with third countries.

Kinnock, Neil
Madam President, there is one advantage - and I think only one - in meeting and discussing important issues at this time of night. It promotes a certain kind of team spirit which is all to the good, especially in the development of further solidarity between the Commission and this Parliament. I am extremely grateful to those Members who have expressed satisfaction at the fact that the Commissioner is here to listen to this interesting debate tonight. All of us are here, of course, at no extra cost to the European taxpayer.
As the House will know and as Members have said, this proposal offers the legal prospect of welcome change and improvement in the protection of the interests of air transport passengers. Despite the fact that there is still a small point of difference with the Council, progress towards the adoption of this regulation is assured and the fact that the common position wholly or partly incorporates fifteen of the nineteen amendments adopted by this Parliament during its first reading, will mean that the House can feel some justifiable satisfaction.
The main objectives of the original proposal were, as the House will recall, the removal of the long outdated liability limits of the Warsaw Convention, the establishment of a principle of strict liability up to 100, 000 special drawing rights, about ECU 120, 000, and the specifying of a requirement for airlines to make an advance payment to persons entitled to such payments. I am pleased to say that those objectives are all intact. The only change of significance made by the Council was the deletion of the commitment to introduce application of the regulation in negotiations with third countries. That proposal has now been re-submitted in the amendment offered by the Committee on Transport and Tourism, as we have heard in the course of the debate.
As the House will know, the Commission considered this amendment and the proposal contained within it to be a useful and legitimate proposal which, without violating the rules of the Warsaw Convention, aims to encourage third country carriers to apply the same levels of insurance cover as Community airlines, while those third country airlines are operating within the Community. The Commission can therefore agree to Amendments Nos 1 and 4. I can also inform the House that in our preliminary discussions with the Central and Eastern European countries on air transport, the Commission has already adopted this approach by requesting that their air carriers apply such levels of insurance cover when operating to, from or within the Community.
The Commission can also accept Amendments Nos 2 and 3 to replace Article 6.2 and 6.3 of the common position. It is important that comprehensive information on the carrier's liability regime is accessible to passengers exactly as Mr Gonzalez Triviño has correctly argued. The conditions of carriage also contain other information of interest to passengers and a reference to those conditions clearly has value. The suggested system would mean that there was no need for several different notices to be attached to the ticket, thereby dealing with the problem highlighted in recent correspondence from IATA.
I would like to commend warmly Mr Gonzalez Triviño and the Committee on Transport and Tourism for the excellent work done on this issue, not just in the report we are considering tonight. I am very grateful for the continued support which has been consistently offered by this House to the Commission on this proposal.

President
Thank you, Mr Kinnock.
The debate is closed.
The vote will take place tomorrow at 11 a.m.
(The sitting was closed at 12.05 a.m.)

