
Posselt
Mr President, a rather serious problem arose this morning when the assistants were suddenly prevented from boarding the coach to bring us here from the Hotel Monopol, despite the fact that this practice has been applied without a hitch for the past 21 years. I should like to protest because there would have been five members in the coach and the assistants would have been late for work. It is a stupid regulation because the bus carrying five passengers could have been replaced by two cars, meaning that there would have been two drivers instead of one. This bureaucracy must have been thought up by our quaestors and we urgently need to abolish it so that members can take their assistants with them to work.

President
Mr Posselt, we will pass on your arguments to the College of Quaestors so that they can adopt the resolution that they think best and so that it will be known to all Members.

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

Dary
Mr President, I just wished to point out that I forgot to sign the attendance register yesterday evening.

President
We will take note of it.
(The Minutes were approved)

Vote on a request for urgent procedure
President.
Mr Varela, chairman of the Committee on Fisheries, has the floor to give his opinion.
Varela Suanzes-Carpegna (PPE-DE), chairman of the Committee on Fisheries. (ES) Mr President, I would like to inform you that the Committee on Fisheries has decided not to accept this request for urgent procedure, as we were not aware of the Commission proposal until 20 November, when we no longer had time to include it on our agenda. It was therefore not possible for us to deal with it with the urgency that was asked of us.
However, we will do everything we can to ensure that we will be able to debate it here in the next part-session of the new year.

President
Thank you very much, Mr Varela. As there are no other speakers, the Commissioner has the floor.

Schreyer
Mr President, ladies and gentlemen. the regulation on control measures in the area covered by the Convention on future multilateral cooperation in the north-east Atlantic fisheries stipulates that the provisions governing the application of these control measures only apply for the year 2000. The Council was unable to agree on a longer regulation at the time and the rules in question therefore expire at the end of this year.
If we delay in amending this regulation, we shall have no legal basis for European Union control ships in the international waters of the north Atlantic after 1 January 2001. This will undermine the whole control system and the regional fisheries organisations, which will be weakened as a result. The control system has proven to be a first rate system and we should spare no effort to strengthen and develop it further. The Commission therefore supports the Council's request for urgent procedure and calls on the members of the European Parliament to support this urgent procedure.

President
Mr Varela, chairman of the Committee on Fisheries, the committee responsible, has the floor again.

Varela Suanzes-Carpegna
Mr President, I regret very much that the Commission did not take all this into account before and did not inform us in sufficient time so that we could work on it in committee. However, the international measures mentioned will remain in force because this is an international agreement. They will not, therefore, be affected by the delay. Moreover, as I said before, I hope that we will be able to vote on this proposal during the January part-session.
In any case, it is regrettable that they are asking us for an urgent procedure now, at the last minute, because we have had all of 2000 to process this proposal for a regulation.
I think that the institutions, in this case the Commission, should work more responsibly to ensure that proposals reach this House in due time so that a rapporteur can be appointed, the Commission proposal can be examined, amendments can be tabled, they can be debated in committee and they can then come to the plenary, which they have asked us to do in a single plenary sitting, which is impossible.

President
Having heard the speeches from the Commissioner and the chairman of the Committee on Fisheries, I put the request for urgent procedure to the vote.
(Parliament rejected the request for urgent procedure)

2001 budget
President
The next item is the joint debate on the following reports:
A5-0380/2000 by Mrs Haug and Mr Ferber, on behalf of the Committee on Budgets, on the draft general budget of the European Union for the financial year 2001 modified by the Council (all sections)
[13830/2000 - C5-0600/2000 - 1999/2190(BUD)]
and on Letter of Amendment No 2/2001 to the 2001 draft general budget [13833/2000 - C5-0653/2000]
Section I, Parliament
Section II, Council
Section III, Commission
Section IV, Court of Justice
Section V, Court of Auditors
Section VI, Economic and Social Committee
Section VII, Committee of the Regions
Section VIII, Ombudsman
A5-0391/2000 by Mr Colom i Naval, on behalf of the Committee on Budgets, on the proposal for a decision of the European Parliament and the Council concerning the use of the flexibility instrument (Paragraph 24 of the Interinstitutional Agreement of 6 May 1999 on budgetary discipline and improvement of the budgetary procedure) [SEC(2000)2167 - C5-0665/2000]

Haug
Madam President-in-Office, Commissioner, ladies and gentlemen, allow me to start by thanking the President-in-Office, who negotiated with us, with Parliament, in a shrewd and tenacious manner, often without the support of her colleagues, by thanking the Commissioner, who never once lost sight of global European interests, both on and off stage, and by thanking all my colleagues who backed me at the most crucial moments, even where they were of a different opinion, and who were supportive and joined forces in order to defend Parliament's position. My sincere thanks to one and all. Without such teamwork we could never have arrived at what is now a relatively comfortable, by that I mean perfectly tension-free situation. There now appear to be no further obstacles to Parliament's passing a resolution on the European Union budget for 2001 on Thursday.
The chairman of the Committee on Budgets tells me that this is the very first time that agreement has been reached between the Council and Parliament at conciliation. So well done everyone!
There is a proverb which says that money makes an evil master but an excellent servant. As the elected representatives of the people, we parliamentarians have acted in accordance with this proverb. We have not harped on about principles. We have not set budgetary objectives in advance and then tried to tailor our policy to them. We wanted a proper, economical, logical budget which would allow us to honour our political commitments and really help those who need our help.
So we agreed with the Council during the night of 23 to 24 November on the main points of what is a perfectly reasonable, although by no means brilliant budget. Whichever way you look at it, it is reasonable not to give up in the fight against unemployment in Europe, which is why we keep insisting on the need for action at every political level - at local, regional, national and at European level. The European budget will include EUR 450 million to promote employment over the next five years by supporting small and medium-sized enterprises.
If we implement the action lines described in the charter on SMEs and help SMEs to apply new technologies, we shall, I think, have found a way of creating jobs. The agreed EUR 450 million is more than four times what the Commission proposed in the preliminary draft budget and frontloading EUR 100 million next year should get us off to a flying start.
The Committee on Budgets proposes that plenary remove the reserves set up at first reading. This applies both to the performance reserve under the heading foreign policy and the administrative expenditure reserve. We have stated time and again that we support the reform of the Commission and that we agree to the 400 new posts, combined with a new early retirement scheme, but only subject to certain conditions. Some of these conditions have now been met. The Commission has submitted its analysis of outstanding commitments and its strategy for eliminating abnormal outstanding commitments. We put the final touches to a joint declaration by the Council and Parliament in a trilogue last Tuesday. We all agreed that the Commission should draft a report by the middle of next year on progress made in phasing out commitment backlogs, implementing programmes and simplifying project cycles, a report on how comitology is working, on progress made in implementing the reform package and on the performance targets of the main programmes under Category IV, to mention just a few aspects of the joint declaration. We now expect the Commission to start work at soon as possible.
Apart from a few minor skirmishes started or continued by the Council at second reading, our second reading has been stripped of most of its contentious points, mainly because we have stated that we are prepared to help the Council achieve what it sees as the extremely important objective of reducing the increase in payments to 3.5%. This will be achieved mainly by removing the Structural Funds reserve set up at first reading and making fewer payments for Community initiatives, which need to be rebudgeted anyway. The Commission's Letter of Amendment no. 2 which, following renewed calculation, has deducted around EUR 900 million from the sum needed for Category I, was also extremely helpful here. This Letter of Amendment is most welcome and I imagine that Parliament's consent to it is most welcome in the Council, because it also contains an estimated surplus for the current budget of EUR 900 million, which can be entered straight away under revenue for 2001.
What worried us most right through the budget procedure was how to fund our foreign policy. Our financial perspective for Category IV was clearly way off target since the war in the Balkans. The Commission therefore suggested revising the figures by EUR 300 million. The Council fought against this tooth and nail and it was impossible to reason with it on this point, just as it was last year. For the Council, the financial perspective is a monstrance and must not be changed. It has made it into its evil master, to continue the proverb which I quoted earlier. We were therefore forced to do a deal with it on the EUR 200 million flexibility instrument, as if this did not represent a change to the financial perspective. But at least we now have a further EUR 200 million at our disposal, although we did in fact need another EUR 300 million. But we can at least fund what we think is the most important task, i.e. the democratisation and reconstruction of the western Balkans, from a total of EUR 839 million, including EUR 240 million for Serbia.
We refused to allow our other foreign policy priorities to be whittled away still further. We can finance cooperation with the Baltic region and our crisis reaction forces and we have given MEDA EUR 40 million more than the Council provided. So, as you can see, we have cobbled together a solution for the 2001 budget. However, this solution is weak on political and budgetary planning, because it takes no account of the fact that money is needed over a period of several years.
I should like to have responded to long-term requirements with proper multiannual planning. All this means, of course, is that we shall face the same mountain of difficulties during the next budgetary procedure.
I hope that the person who succeeds me as Parliament's general rapporteur and the Belgian Presidency of the Council, which will be taking over in the second half of next year, enjoy their discussions. I know from my own experience just how difficult it is to keep all the groups in Parliament together. However, I also know from the discussions that it is far more difficult to formulate a negotiable Council position, obtain a mandate and accommodate pure national chauvinism in a fairly reasonable and tenable overall European decision. Naturally, that does not only apply to purely budgetary processes, as the Nice Summit so graphically demonstrated yet again.
So we stand once again at the end of a year and ask ourselves how, in Heaven's name, we can make the Council see reason and make a good servant out of an evil master.

Ferber
Mr President, Madam President-in-Office, Commissioner, ladies and gentlemen, I must, of course, start by joining Mrs Haug in thanking all the officials and members and the Commission services, although the words do stick in my throat somewhat when it comes to the Council. I have the honour of dealing with the minor budgets: here the procedure is relatively straightforward and we all know who has the final word. They may treat us shabbily in Nice but to reverse everything Parliament has done, as in the case of the European Court of Justice, knowing full well that we shall correct it all again this week, is just a waste of resources and we could have helped protect the environment by using less paper. Meeting Parliament half way would not have come amiss here and would have saved us some work, although I have no objection to the work because what I want for the future is an efficient European Court of Justice which can do its job and, more importantly, clear the backlog of translation work. If the Council had shown itself to be more accommodating, we could have brokered an agreement back in October.
Having been allocated so little time, which is a pity because the budget - and the rapporteurs - deserve more than a derisory two and a half minutes, I must confine myself to just a few comments.
We must consider internally how all the present requirements can be developed into transparent procedures in the area of promotions policy. I am delighted that not only the Court of Justice and the Court of Auditors but also the Economic and Social Committee and the Committee of the Regions have already started to review their promotions policy and develop a transparent, merit-based procedure in which individual performance rather than seniority is the deciding criterion. I think that we are on the right path and, as part of the budgetary authority - in this case as the budgetary authority because the Council does not play the most decisive role here - we shall help to ensure that this continues in the future.
We here in Parliament must also check to see that our budget still meets the criteria of honesty and clarity. Let me be quite clear here: we have a number of vacant positions here in Parliament, which save us several tens of millions of euros from one year to the next. We must therefore consider if the whole way in which we draw up our own budget is still correct, which is why our resolutions will call on our own administration - and I hope that the House will come on board here - to submit a full report on the vacant positions in the House, so that we end up with a budget which meets the criteria of honesty and clarity.
I hope that work will progress on a European recruitment agency - or "joint recruitment office" as we call it in our very best German - so that we can jointly overcome the problems which all the institutions - the Council, the Commission, Parliament and the other institutions - will face over coming years, i.e. the problem of staffing over coming years. I trust that we shall make real progress here.
I have overrun by one minute and it was a pleasure to do so. Have I now been allowed more time? If so, I shall gladly give it to the group because I only prepared for two and a half minutes and intended to overrun by one minute. I have therefore met my personal target. I should like once again to thank all my colleagues. As far as the other institutions are concerned, we have worked together to achieve what I think is a good result which cuts across all party, group, country and other divides. If the Council were prepared to follow suit next year, if it listened to Parliament more readily, it would be even easier to achieve a good result.

President
Ladies and gentlemen, do not think that my heart has been softened by Mr Ferber' s arguments, but he actually had five minutes to speak and the services had only indicated two and a half minutes. Sorry, Mr Ferber. And if you wish to add anything later - because you had one minute left - I will give you the floor.

Colom i Naval
Mr President, when a delegation from this Parliament was visiting the People' s Republic of China some time ago, we were in Xiamen, in the south-east of China, and there was an island visible on the horizon. We asked what is was called and they said, "It is the unmentionable." It was Taiwan and its name cannot be mentioned in China. Here the thing that we are not allowed to mention is 'revision of the financial perspective.'
Ladies and gentlemen, I think that we should almost be kneeling down to deal with this matter, because it is a religious one. In the Council' s religion it is forbidden to mention the word revision. That is crystal clear. But I challenge my esteemed colleague, the President-in-Office of the Council, to explain to me what the difference is between the revision of the financial perspective and the use of the flexibility instrument: the majorities are the same, and the amounts can be the same.
Apart from it being taboo, it is really difficult to explain why the Council refuses to recognise the need for a revision of the financial perspective.
What is more, of the thirty-eight revisions that the Community has had since 1988, which is when this system was set up, twenty-odd have been annual revisions. So not even the argument for annual or multiannual revisions is an excuse.
Perhaps another reason why we should discuss this on our knees is the attitude of some Members of this House, as all they seem to want to do is blindly obey the instructions of the Council.
We have really fought a great battle in order to achieve a 0.02% increase in the Council draft budget. I do not know whether this is a great success for this Parliament. It can even be seen in the Structural Funds, where the Commission told us that 8 000 million additional payment appropriations were needed, and the result is that we have cut them by 340 million, which is, of course, the request of the Council, not of Parliament.
I wanted to briefly point out that, when we adopted the financial perspective in force, in 1999, we were still - I say 'we were' due to the involvement of the Union - bombing the Balkans, particularly Serbia. And we left it that when the conflict ended we would revise the financial perspective. We agreed this between the Council and Parliament.
The Council refuses to carry out this revision - it seems that now we should have the information - and I want to warn you: using the flexibility instrument two years in a row, two consecutive years, in fact, in less than fifteen months, and the first time less than six months after the adoption of the perspective, is financially draining the flexibility instrument because it prevents it from being replaced and from possible accumulation, which is planned for up to 600 million. But it is also draining it politically and this is much more serious, ladies and gentlemen, because it could lead to Parliament having a complete lack of confidence in the very system of financial perspective.
To be honest, the Council is leading us to believe that the system is not satisfactory because one of the contracting parties is not fulfilling the political requirements involved in signing an agreement.
The needs of the Balkans have not come to an end, they are multiannual. So now what are we going to do? At the moment we are beginning to sacrifice MEDA, which went down from EUR 980 million in 1999 to EUR 741 million in 2001. It is the first victim of not having a revision. I wonder who will be the next victim?
I would like to know, Mrs Schreyer, what is going to be done with the initial proposal for revision of the financial perspective. The Commission has not withdrawn it. I would therefore like to know what you are going to do.
Are we going to continue to fund the Balkans with juggling, as we have done now, at the end of 2000, "pre-budgeting" things and then introducing EUR 200 million in the 2001 budget? What are we going to do in March? I know that it will be the job of the Swedish Presidency, but in March we need to look at the perspective for 2002, and what are we going to do? The matter of the Balkans will not have been resolved.
To be honest, I think that I have to recommend to this House that it approve the mobilisation of the flexibility instrument because, in short, it enables us to solve the Serbia issue and because it is a revision that no one is daring to call by its name.
Ladies and gentlemen, the Emperor is not wearing any clothes.

Parly
Mr President, Commissioner, ladies and gentlemen, following the Nice European Council, where European integration made significant progress, which the President of France will shortly present to you, I am delighted to present you with the second reading of the draft budget of the European Union, as established by the Council on 24 November. It is a pleasure, but also an honour and an emotional moment for me to be here with you, at the heart of European democracy.
The Council' s second reading was preceded on 23 November by a conciliation meeting between the European Parliament, the Council and the Commission. The outcome of this long meeting was, I believe, a twofold success. It was a success for Europe because we were able to overcome our initial differences of opinion and a political success because this budget is an expression not only of a compromise, but also - especially - of our priorities.
Indeed, the representatives of the three institutions spared no effort to conclude an overall agreement on the 2001 budget and I wish to take this opportunity to thank, on behalf of the Council, both the members of the parliamentary delegation and Mrs Schreyer.
The Council has therefore proceeded to its second reading of the budget, taking account of the agreements concluded with the delegation from Parliament, with the ever-present desire to vote for a budget that will enable us to fund all of the European Union' s priorities and a budget that matches up to real needs and to our true ability to make use of appropriations. This budget will also enable us to implement the reform of the common agricultural policy and to carry out the programming of structural actions as defined in 1999, as well as all of the major programmes decided on jointly by Parliament and the Council. I am thinking specifically here of research, the Trans-European Networks and culture or audiovisual creation, with the MEDIA Plus programme, on which an agreement was concluded on 23 November.
I should now like to focus on the main progress made at the second reading in Council. The first point of agreement between the Council and Parliament concerns external action, that is, heading 4 of the budget, on which our institutions shared a common goal, which was to release substantial funding for the Balkans region in 2001, given recent developments in Serbia' s political situation, and to do so without passing the costs of this on to the other geographical priorities of the Union' s external action.
The agreement reached on 23 November therefore defines an overall allocation for the Balkans of EUR 839 million, of which EUR 240 million are earmarked for Serbia. This very considerable amount, which matches the heavy requirements for 2001, will be largely funded by mobilising the flexibility instrument for an amount of EUR 200 million. Parliament thereby retains considerable room for manoeuvre at second reading to fund all its other geographical priorities and to do so within the ceiling of heading 4, as the Council had hoped.
The second important aspect of the Council' s second reading concerns Letter of Amendment No 2, which enables the Commission' s new provisions in the field of agriculture to be implemented. The Council has accepted this Letter of Amendment in its entirety and, out of the same concern to act in accordance with the most recent data available, the Council has also accepted the European Parliament' s amendments on rural development expenditure, which demonstrate the progress that has been made in the adoption and implementation of national programmes.
Finally, the Council voted, as had been arranged at the conciliation meeting of 23 November, in favour of additional credits to the value of EUR 60 million, for the funding of screening tests for BSE. This sum of EUR 60 million is a preliminary, rapid budgetary response to the Council' s decision to extend tests carried out on cattle. It must therefore be seen as a provisional sum. The BSE crisis will indeed require other measures, for which a budgetary assessment has not yet been completed and when a system has been more precisely defined, we will, of course, have to take account of its potential impact on the budget and to release the necessary appropriations whilst, as a matter of priority, studying the possibilities of redeploying funds within heading I. Additional funding can then be provided through a supplementary and amending budget within the financial perspective.
I am delighted that our institutions have been able to reach agreement on adopting, at only one reading, all aspects of this Letter of Amendment No 2, which concerns not only agricultural expenditure but also the fisheries agreements and the inclusion of an estimated balance for the 2000 financial year in the preliminary draft budget for 2001.
The third important aspect of this Council second reading concerns the agreement reached on the allocation for the "Spirit of Enterprise" programme, which continues and complements the "Employment initiative" for the years 2001 to 2005. The Council and the President have agreed on a very substantial allocation of EUR 450 million for this period and on an allocation of EUR 100 million for 2001. The credit for this result, which is proof of the priority given by the European Union to the development of small and medium-sized businesses and to employment must be given to your rapporteur, Jutta Haug, who is in the Chamber today. This action is also one of the Council' s political priorities, as expressed at the Luxembourg, Lisbon and Feira Summits.
Lastly, agreement was reached on 23 November on an increase in payment appropriations for the 2001 budget, which is an increase of 3.5% over the 2000 budget. As you all know, this aim is particularly "dear" to the Council and I wish to emphasise that an increase of 3.5% will require a considerable effort on the part of the Member States, given that this is slightly above the increase in their national budgets. However, I am, of course, aware that this agreement will also require a considerable effort by Parliament, because it will require you to arbitrate on sometimes sensitive issues in your first reading.
This agreement on the increase in payments has been made possible by the Commission' s proposal to rebudget an amount of EUR 1600 million in commitment appropriations for Community initiative programmes for 2002 and for subsequent years. This proposal, which is the result of the time limits necessary for the adoption of these programmes, has been accepted by the Council and by Parliament. It therefore means that payment appropriations requirements for the preliminary draft budget will be reduced by EUR 700 million.
When the Council voted at second reading for a budget increase of 2.5%, it took due account of this new factor. For its second reading, Parliament therefore has the considerable margin for manoeuvre of around EUR 1 billion to fund its budgetary priorities, whilst remaining within an overall increase of 3.5%.
The Council did not, of course, limit its second reading to the four points that I have just mentioned. It also accepted several European Parliament amendments in heading 3 on internal policy, particularly in order to take account of developments in legislation.
Furthermore, the Council accepted certain preparatory actions and certain pilot projects within the limits laid down by the Interinstitutional Agreement, having consulted the Commission on their feasibility.
Finally, the list of points of agreement between the Council and Parliament would not be complete if I did not mention two important texts that have been adopted this year. First of all, a joint declaration on improving the information provided to Parliament and the Council on the Commission' s financial programming, which was adopted in July, on the initiative of Mr Colom i Naval, which I welcome.
Secondly, a joint declaration has just been adopted, quite recently, on the progress report on the reform of the Commission, on the initiative of Mr Elles.
These two declarations improve the transparency of the budgetary procedure and of the reforms currently taking place in the Commission. I think that they are bound to improve the efficiency of these procedures, which is, I believe, an objective shared by all our institutions. Personally, I consider this to be extremely important.
More generally, I wish to emphasise that the budgetary procedure that will be completed in a few days has clearly demonstrated the interest in the Interinstitutional Agreement of 6 May 1999. It is as a result of the consultation between the three institutions, which is provided for and regulated by this agreement, that we have been able to work together on this draft 2001 budget. Mobilising the flexibility instrument, which is one of the key innovations of the 1999 agreement, has therefore enabled us to conclude an agreement on the funding of the European Union' s external actions in 2001, whilst taking account of factors that may occur along the way. These additional appropriations will enable us to speed up the European Union' s aid programme for the Western Balkans in 2001. By the same token, within this Interinstitutional Agreement, the Council has left substantial margins within the ceilings of the financial perspective established in 1999, largely for heading 3 - internal policy - and for heading 4 - external action. These margins will give the European Parliament the opportunity, at second reading, to set its own priorities within the various Community policies and actions.
Lastly, before you proceed to the final adoption of this budget, I wish to stress the importance the Council attaches to some of the fundamental budgetary rules, in the field of entering appropriations in the reserve, the legal basis and the classification of expenditure.
First of all, the entering of appropriations in the reserve can only be carried out by the budgetary authority if the corresponding legal basis has not yet been adopted, in accordance with the provisions of the financial regulation. The Council therefore, at second reading, re-established all the appropriations entered into the reserve by Parliament for reasons other than the absence of a legal basis.
In this respect, I welcome the agreement that has been reached at first reading by our two institutions to abolish the conditional entering of appropriations in the reserve, which had been carried out by Parliament, for heading 4, the performance reserve, and for heading 5, with regard to appropriations relating to the reform of the Commission, under Letter of Amendment No 1.
Secondly, I should like to insist on the respect for the rules that is incumbent on the institutions with regard to classifying appropriations as compulsory or non-compulsory expenditure. Your Committee on Budgets has proposed to change two budget lines by amendment at second reading, one concerning the early retirement scheme and the other expenditure relating to the fisheries agreement.
I wish to draw the European Parliament' s attention to the fact that, under the terms of the Interinstitutional Agreement, these budget lines constitute compulsory expenditure, which was, moreover, acknowledged by Parliament at first reading. Consequently, appropriations included in these lines must be considered to have been definitively adopted following second reading in Council, in accordance with Article 272 of the Treaty and cannot therefore be further modified.
To conclude this overview, I wish to join those who have highlighted the excellent climate in which this budgetary procedure has taken place. The discussions were at times frank, but were always relevant and underpinned by ongoing exchanges of views, which enabled us better to understand each other and therefore to more easily conclude an agreement, which I hope everyone will find satisfactory. A good budget is a budget that has been thoroughly discussed. This budget should therefore be born under the best auspices. I wish to personally thank Terence Wynn, chairman of the Committee on Budgets, and the three rapporteurs, Jutta Haug, Markus Ferber and Joan Colom i Naval as well as all the members of the Committee on Budgets that I have had the pleasure of meeting during the six months of the French Presidency.
I can assure you that the Council' s objective, throughout this budgetary procedure, has been to produce a budget for 2001 that will enable the European Union to respond to the crises that affect it within Europe itself but also those occurring beyond its borders. I think that, together, going beyond the priorities of each of our institutions, we have created, step by step, a budget for the 2001 financial year, which reflects the ambition that we all advocate, of a Europe at the service of its citizens. You must now give this outcome your approval.

Schreyer
Mr President, ladies and gentlemen, unlike the negotiations in Nice, a substantial result was achieved on the 2001 budget in a single joint night sitting. Unlike Nice, all three institutions - the European Parliament, the Council and the Commission - are, I think, well pleased with the final result.
It provides a good basis for Community policy next year; to be honest, the Community approach has been most productive throughout the year, throughout all the preliminary discussions and, on behalf of the Commission, I really must thank you and your colleagues, Mrs Parly; you proved to be a very skilled midwife at the birth of this 2001 budget and focused the debates and negotiations on the core issues. I should also like to thank the rapporteur, Mrs Haug, for her highly original combination of total determination and willingness to negotiate which culminated in this good result.
I should also like to thank the rapporteurs, Mr Ferber and Mr Colom i Naval, the chairman of the Committee on Budgets, Mr Wynn, and the members of the Committee on Budgets for being so committed. It was thanks to their commitment that negotiations were brought to such a successful conclusion. The 2001 budget which we now have before us gives us funds of EUR 96.2 billion for new commitments next year and EUR 92.6 billion for payments. That translates into a rate of increase in the budget, as you pointed out, of 3.1 and 3.5% in comparison with the previous year, roughly in line with the rate of increase in the national budgets.
One very important point is that the total budget only accounts for 1.06% of the joint European gross national product and, in terms of expenditure ratios, is lower than this year's budget. This illustrates that we have applied budgetary discipline, but it also illustrates that the financial planning concept decided in Berlin, i.e. that expenditure for the current Member States is being cut back in order to find room to fund enlargement, is being taken into account and is working. However, we must also note that the figures before us today do not include the supplementary budget which still needs to be addressed in the wake of the BSE crisis. I shall come back to that in a moment.
First: what is so special about the 2001 budget? In the Commission's view, it is the fact that the second pillar of agricultural policy, namely promoting rural development, shows the highest rate of increase at 10%. I think this is worth mentioning because it means that we have a total of EUR 4.5 billion at our disposal. I really must disagree with the chairman of the Committee on Agriculture, who stated recently in a newspaper interview that this amounted to no more than a toothpick, never mind a second pillar, because this fails to do justice to the size of the sum in question: 4.5 billion is a considerable sum of money - it is almost as much as we have for the whole of foreign policy and the size of this sum and this ratio need to be highlighted. We really can say, in foreign policy, that the policy of the European Union is having a huge effect, even with this budget, and I am positive that it is thanks to Community policy that we now have democratisation in the Balkans and a chance, hopefully, of stability in the near future. I am positive that no such success would have been possible with the old concept of bilateral friendships, with Member States being played off against each other. It is the outcome of Community policy and it is therefore excellent that we have again managed to include EUR 839 million in the 2001 budget for the Balkans. It was no easy task, but we managed thanks to the agreed use of the flexibility reserve, which was used to provide funds over and above the sum provided for or decided in Nice as a basis for the Balkan policy - namely a total of EUR 4.65 billion over the period up to 2006.
In providing the EUR 200 million emergency package, the Union has also proven that it is perfectly able to act quickly and take full account of its foreign policy responsibilities. What is important is that no country in the Balkans will now be offered less aid than originally planned before developments in Serbia due to the democratisation of Serbia. I think it is also important to signal that we fully support the new potential for cooperation which has arisen at last.
I should like at this point to take the opportunity to thank Mr Kouchner for his splendid work in Kosovo; we were also able to provide huge support here from our budgetary resources.
The process of reforming the Commission is also extremely important, particularly with a view to good financial management. Good financial management needs sufficient, well-qualified staff. Allow me at this point, on behalf of the Commission, to thank the budgetary authority for its support and for approving 400 new posts. You have linked this with a call for a concerted effort to bring about improvements, especially in areas in which financial support programmes have been implemented late or badly and I can assure you, ladies and gentlemen - especially you Mr Elles - that the Commission will do everything it can to improve its past record on the implementation of financial programmes. But let us not delude ourselves: we need both good financial management and the corresponding means of payment if we are to eliminate outstanding commitments.
Nearly a third of the budget is set aside for structural policy, in order to help regions in economic difficulty overcome their problems and make up economic ground, especially through the Cohesion Fund. The Court of Auditors recently confirmed in a special report that this objective is being achieved and that the money from the Cohesion Fund is being put to good use. Here the Community is demonstrating solidarity by using Community funds to provide real support for economic development and it goes without saying that the regions and countries which are now on the receiving end of our solidarity will be prepared in the future to demonstrate their solidarity with the new countries, as and when we enlarge the European Union.
Ladies and gentlemen, with the new outbreak of BSE in cattle, immediate action was also required in the budgetary area in order to protect health and consumers and help the farmers affected. The budget being voted on today includes EUR 6 billion to subsidise beef production, in addition to the EUR 60 million budgeted in order to cofinance BSE tests. The agricultural ministers meeting in emergency session have proposed new measures in the wake of the BSE crisis, but we are all agreed that it makes no sense to postpone the resolution on the budget in order to include these new measures and that a supplementary budget will be submitted post haste in order to fund the necessary measures.
A considerable amount of money will be needed, which is why I think that the Ecofin Council needs to address the budgetary consequences as a matter of urgency, because there are still points at which there is a discrepancy between our claims, or what we have in mind, and the funds at our disposal. Plus - and this was again stressed in Nice - we have to comply with the financial regulations and ceilings for the agricultural budget. Here we are in the peculiar situation of having even less room for manoeuvre because of the change in exchange rates. I was therefore most annoyed when the agricultural ministers, whilst fully aware of the BSE situation, rushed and served themselves from Christmas tables piled high with fruit and vegetables, bananas and nuts which required a total of 85 million in increased subsidies.
I think that when a new emergency arises - and with the BSE crisis new priorities obviously need to be set in the agricultural budget - then certain consequences also apply and clear resolutions need to be taken and the core issues defined for the agricultural budget, which does, after all, total EUR 44 billion.
As the Commissioner responsible for the budget, I am completely behind the emergency action which needs to be decided, including support for the beef market, but the fact that we subsidise beef production to the tune of EUR 6 billion on the one hand and must now pay out thousands of millions to subsidise its destruction is proof positive, in my opinion, of the urgent need for action in the whole agricultural policy sector. I trust that the European Parliament will support me here.
Several decisions taken at Nice are highly relevant to the budget and the budgetary process. All the institutions will have their work cut out here. All the more reason to rejoice in the fact that negotiations on the 2001 budget were conducted in such a good atmosphere and led to such good results and, on behalf of the Commission, I should like thank everyone involved.

Colom i Naval
Mr President, as the rapporteur I thank both the President-in-Office of the Council and the Commissioner for their kind words, but I did ask a concise question in my previous turn. It was asking for someone to explain to us rationally, if not in a Cartesian manner, the difference between an annual revision of the financial perspective and the use of the flexibility instrument. I would like to have an explanation. If not, I will have to interpret that silence is the response.

Parly
Mr President, I should like to answer Mr Colom i Naval on the issue of the use of the flexibility instrument in revising the financial perspective. In fact, the repeated use, two years in a row, of the flexibility instrument could be considered, wrongly in my opinion, to be a form of revision of the financial perspective. Personally, I think that this is not true in terms of procedure and certainly not in terms of substance. The procedure for the flexibility instrument was laid down in the Interinstitutional Agreement for the purpose, in exceptional cases, of funding specific expenditure over and above the ceilings agreed in Berlin, without calling the financial perspective into question. I therefore think that, with regard to content, there is no contradiction between the two approaches, but rather a form of complementarity.
With regard to the specific cases that we have experienced for the last two years, in other words, Kosovo and Serbia, mobilising the flexibility instrument has enabled us to fund exceptional expenditure through an exceptional effort. In both of these cases, the flexibility instrument has enabled us to anticipate needs. In Kosovo, for example, there was a need to implement aid more quickly whereas in Serbia, the need was to commit a significant sum, even before a definitive assessment of needs was carried out and even before the distribution of roles between the various donors could be defined.
From the Council' s point of view, therefore, mobilising the flexibility instrument does not represent a challenge to the viability of the financial perspective laid down in Berlin. Furthermore, the Council has defined a multiannual sum, admittedly indicative in nature, which is compatible with this financial perspective, for the framework programme for aid for reconstruction in the Western Balkans.
I hope that I have answered Mr Colom i Naval' s question.

President
After this illustration, which I am sure will be very useful to all Members, we are going to do the round of the opinions of the various parliamentary committees.

Evans, Jonathan
Mr President, I wish to begin by thanking Mrs Haug for her hard work and her success in relation to small and medium-sized enterprises. That has been a high-order issue for the Committee on Industry, and we are very pleased with the success that she has achieved. However, it is not just a success for the Committee on Industry and for Parliament; it also reflects the priorities of governments in Europe. That is the point that causes me some consternation in relation to the position adopted in this process by the Council.
My committee is very interested in the research area. We praised Commissioner Busquin, who has exceeded our expectations in that area. We have heard the Council say on many occasions that it wants to ensure that Europe becomes pre-eminent in research. Then we see the Council make a significant cut in payment appropriations, so that Mrs Haug then has to make some changes. We have heard from the Council today that it is prepared to improve the record by 3.5%. That is the context of the process we are engaged in. I congratulate our rapporteur. However, our committee is somewhat disappointed by the approach of the Council.

Maat
Mr President, I would like to thank the rapporteur, Mrs Haug, for the outstanding cooperation, and also the chairman of the Committee on Budgets, Mr Wynn. I have two comments to make in connection with the document now on the table, and these are directed at the Council and the Commission.
To start with, I want to talk about the overall agricultural budget. Of course we know that it comprises almost 45% of the EU budget, but if you add up what the EU Member States contribute and what the European Union contributes to the agricultural budget, you arrive at 1.9%, and a substantial amount of that is spent on the development of rural areas and environmental development. That is a mere pittance compared with what other trade blocks in the world spend. If you consider that American companies receive the equivalent of three times as much aid and a capricious country such as Turkey spends in excess of 10% of government money on agriculture and horticulture, then it is Europe that wants something for nothing.
My second point concerns BSE. I think you should know that on the night of 23 and 24 November, when we sat round the table with Mrs Parly, we fought like lions to get more money for BSE. The Committee on Agriculture and Rural Development told us to use the financial leeway between the financial perspective and the final budget, which amounted to upwards of generous EUR 900 million at the time, EUR 600 million of which was to be used for BSE. We fought tooth and nail to add a few extra million euro. A week further down the line and two cases of BSE have come to light in Germany. This means that in actual fact we already need a supplementary budget of EUR 900 million. This would suggest that the Committee on Agriculture and Rural Development in this House was keenly aware of what needed to be done and was also fiercely critical of the Council and the Commission in this respect, for their handling of BSE policy. Swifter decision-making based on tests as opposed to draconian measures after the event would have cost considerably less and it would be too stupid for words, regarding this political policy, also on the part of the Council and the Commission, to say that from now on we will include the bill in the agricultural budget. That is impossible because we have an agreement with the Council and the Commission for the remainder of the agricultural budget, for all the necessary allocations, and that means supplementary budgets. It also means that this extra money must come from the Member States, and not be plundered from the existing agricultural budget, because - and I am addressing this comment to both the Council and the Commission - I assume you have given your word on this, regarding the agreement we reached.

Pohjamo
Mr President, I too would like to thank Mrs Haug for her excellent work in preparing the budget. Mrs Haug and the Committee on Budgets have taken account of the proposals by the Committee on Regional Policy, Transport and Tourism. Our committee' s main objective was to see that there were sufficient payment appropriations in next year' s budget. In this way, we ensure that problems with last year' s arrears are resolved and new programmes are introduced effectively. If necessary, the matter of payment appropriations must be examined in the supplementary budget in 2001. The amendments to cross-border cooperation are justified, but we were slightly off target with regard to Interreg and URBAN. The focus for transport is the development of the trans-European transport networks. I am grateful for the investment in sustainable transport, but it has to be said that transport and tourism appropriations are little more than token gestures. In the years to come we will need considerably more in these areas. Our committee will be monitoring the implementation of the budget. The effective use of resources will serve to improve the employment situation, particularly via SMEs and new technology.

Van den Berg
Mr President, as draftsman of the opinion of the Committee on Development and Cooperation, I would like first of all to say that the European Parliament has scored a major victory in as much as the cuts in the Latin American, Asian and African poverty programmes have been made good. I would particularly like to extend warm thanks to the Commission and the Council for this.
Latin America, Asia, Africa and the Balkans should be regarded as pillars of equal standing in our external policy and not played off against each other. This must shortly find expression - as is clear from the debate - in the multiannual programme.
Secondly, it gives me great pleasure to note that there is support from the whole of Parliament, right across the political spectrum, for the concrete objectives for tackling poverty, as have been proposed by the Committee on Development and Cooperation in the 2001 budget, partly on the basis of the historical data provided by the European Commission; in particular, the doubling of the budgets for basic education and healthcare in the regional programmes for Latin America, Asia, Africa and the European Development Fund, amounting to a total of around EUR five million, is a huge step forwards. Output instead of input. We are counting on robust instructions and spending from the European Commission, in line with these objectives. I would like to thank Mrs Haug most sincerely.

Avilés Perea
Mr President, I would also like to thank the rapporteur, Mrs Haug, for the magnificent work that she has done as the rapporteur responsible for the budget and for her efforts in dealing with the requests that the various committees have made.
As far as the Committee on Women' s Rights and Equal Opportunities is concerned, the final result is not exactly the one that we would have liked. The quantities budgeted are very far below what we had requested, but we accept that this has been a general practice and we therefore accept the result as it stands. This does not mean that in next year' s budget we will not once again be determined to obtain what we think is fairest and most appropriate, and what will enable us to achieve the objectives of the Committee on Women' s Rights and Equal Opportunities.

Perry
Mr President, first of all I support the overall budget. It operates within the financial perspective. We have no more important obligation than to live within our means.
I speak on what is probably the smallest line in the budget: EUR 2.9 million for the Ombudsman. That is a very small sum of money. It constitutes less than one cent per inhabitant of the European Union. Let us regard it as the "citizen's cent". We have to make sure that we listen to the citizens and if they have complaints, that there are procedures to redress them. That expenditure is well-spent. The Committee on Petitions very much hopes that its budget will now provide for a proper database so that citizens who are interested in pursuing their petitions will be able to see what progress is being made. We hope that will be achieved.
Finally, information is an important concern for this Parliament. We must see that we keep our information programmes. In particular I would cite Euronews so that people can see in the media what Parliament and the Union are doing.

Miguélez Ramos
Mr President, I would also like to thank Mrs Haug for her excellent work.
I fully agree with the comments made by our colleague Joan Colom on the revision of the financial perspective.
The amount for the common fisheries policy is scarcely 1% of the Community budget. However, this small quantity, which is essential for maintaining the activity of the sector and the economies of areas that are dependent on fisheries, is a very appetising snack, despite being small, each time we look at where to find money to fund new policies.
Commissioner, fish is an essential element for a healthy, balanced diet that is rich in proteins. When European consumers go to the market with concerns about what they can buy, in fish they find a safe, quality product. They will therefore think that this 1% of the European Union budget is being very well used.

Kuckelkorn
The 2001 budget gave rise to a fair amount of indignation among the members of the Committee on Economic and Monetary Affairs, the main reason being that 50% of the PRINCE information campaign was entered in the reserve. This decision would have prevented us from running the information campaign on the introduction of the euro in the year which matters, i.e. in 2001, at a time when uncertainty due to the fall in the value of the euro against the dollar and the need for information on the introduction of coins in 2002 are at their height. The Committee on Budgets decided during the last few days to propose to Parliament that the 50% be removed from the reserve and allocated to these lines. Our warmest thanks therefore to the members of the Committee on Budgets. The Committee on Economic and Monetary Affairs is satisfied and the Commission has the necessary planning security.

Iivari
Mr President, no great drama has been acted out around the debate on the budget this year. That does not mean, however, that things have been easy. The matter-of-fact approach of the rapporteur, Mrs Haug, has nevertheless shown its strength. The Chairman of the Committee, Mr Wynn, also deserves our thanks. It is a positive step, as far as culture is concerned, that the financing of multiannual programmes, i.e. Socrates, Culture 2000, Youth and the new Media Plus programme, are in order with regard to the budget. Hopefully, the problems that occurred in the implementation of the programmes are over. It is important that the Union should serve the needs of its citizens well. In the budget there is direct financing for European culture networks. There is no doubt at all that they need it. But the rules for financing are not yet working properly. There is too much that is arbitrary about all this. The Committee on Culture, Youth, Education, the Media and Sport intends to look into this matter early next year. The modest sums involved must be spent well and fairly.

Elles
Mr President, I speak for the European People's Party and European Democrats. I would like, in introducing our group's position on this, to welcome the work done by Mrs Haug and by our own rapporteur, Mr Ferber, to thank the Commissioner, Mrs Schreyer, and also the Council President, Mrs Parly, for their significant assistance in achieving a budget on 23 November which, as the presidency has rightly pointed out, was a landmark in the way in which Parliament, the Council and the Commission have been able to help decide collectively a budget for the European Union.
We have a budget which is under 1.06%, we have a budget, Mr Colom, which is within the financial perspective. I suspect that, to put it simply, flexibility is for small amounts and revision is for large amounts, but we will see in the next few years how that will go. But I would like to thank both the Commission and the Presidency-in-Office of the Council for their remarks about the joint declaration which we have put together, because that is also a first indication of how we are going to monitor improvements and performance in the running of the programmes, particularly in category 4.
Turning to that for a moment, we have a lot of work in front of us and we await with interest the report by Mrs Schreyer, preferably before 30 June, so that we can use its contents for shaping up the 2002 budget. But in thinking about the question of the backlog on commitments and how we limit the duration of new commitments - obviously this comes into the domain of the financial regulation which we will have to negotiate. We believe it is absolutely fundamental that this progress report should be seen to restore the confidence of our citizens in the way in which the European Union institutions operate.
A word on the reserve, Madam President-in-Office of the Council. You said, if I understood you correctly, that we should not be using the reserve because it was against the rules to do this. We use the reserve, particularly on first reading, to draw attention to particular points of weakness in the way in which policies are operating. The information policy in the institutions at the moment is a scandal and therefore, rather than putting money on the line for information policy when we know it is not being used effectively, we are going to be keeping much of that money in reserve waiting for the Commission to come up with the right proposals. Of course, the solution would be to allow us, as a joint budgetary authority, to lift funds being spent during the year and that may be an invention which we can insert into the revision of the financial regulation.
Lastly, I would say, looking to the future, that Nice has shown us that there is perhaps a feeling that we are shifting a little bit towards intergovernmentalism, with the Council deciding on the numbers of our Parliament without our being consulted beforehand. Our confidence as one of three institutions, will only be maintained - and therefore the institutional agreement and the financial perspective maintained - if we manage to create mutual confidence and if we are consulted at every stage on our fundamental interests.

Walter
Mr President, my thanks first and foremost to Florence Parly, who is just leaving but who, I think, is still within earshot. After the experiences of last year, I think she has created a very good atmosphere, both here and in the Council, with the active commitment which she has shown throughout her presidency. I should also like to thank Mrs Schreyer, who has continued to help us with her highly constructive approach and, of course, my friend Jutta Haug, who has done an excellent job, not forgetting Joan Colom i Naval and Markus Ferber.
We are now at the point at which we must decide whether or not we can vote in favour of this budget next Thursday. Obviously we need to take a very close look at it and this is exactly what Parliament in general and we Social Democrats in particular intend to do. We believe that we managed to do a great deal of good during the discussions, both retaining and extending crucial priorities. With unemployment still at over 8% throughout Europe, the European Union needs to use the budget at its disposal to send out a clear message and to set about fighting this scourge in the economy to our citizens, which is why it is important that we have this 450 million at our disposal next year, starting with 100 million this year. It shows people that we take their problems seriously and are doing something about them.
I am delighted that we have managed in Category IV of this budget to show those living in the greatest need or in the process of democratising their countries throughout the world that this European Parliament and this European Union has not forgotten them, even if we have our own problems to resolve, and that here too we are making sure that there is enough money to go round. It is important for the people in the Balkans to understand, following the long period of hostilities during which our side presented a united front, that they can also rely on us when it comes to reconstruction. There are people sitting in this House who are at pains to ensure that the money needed will in fact be provided as and when it is needed and that flowery words will be accompanied by specific actions.
So I think that, along with much else which there is too little time to mention, we have a great deal to be pleased about. We have also passed a number of resolutions containing instructions. Allow me to say to the Commission, by way of example, that we have agreed to the 400 additional posts because we want to improve how various programmes are implemented, because we want you to be able to work better than you have been able to do in the past. But we also say in no uncertain terms that this implies a responsibility and a commitment on your part, because we shall be watching over you throughout this process. We shall be checking up, we shall be in contact with you and we shall be keeping tabs on what is happening, ensuring that there really has been an improvement before we are prepared to go even further with you.
It is also a commitment vis-à-vis the Council. I have a couple of questions to put to the Council - not that I am questioning the compromise. But should we really have to try year after year to see what is left over from the previous year, what can be carried over to provide enough money for regions such as Serbia and the Balkans? Should we really have to check first and see what is left over? Is our message to these people: we will give you what is left over and then we shall see if we can add anything to it? Should that be our message? No it should not!
By refusing to discuss the specific long-term aspects of this challenge with us, you have brought the whole spirit of the Interinstitutional Agreement into question. You keep saying that the financial perspective is sacrosanct as far as you are concerned. But the Interinstitutional Agreement between the three institutions is also a valuable item and should help us to achieve joint planning security. The Balkans and other regions need planning security. Repeated use of the flexibility instrument also contradicts the Interinstitutional Agreement, because it was an instrument which this European Parliament secured in order to pay for contingencies and so that it could let it run up to EUR 600 million. It was never meant to be used for firefighting every year in areas which we have to fund in any case. You are undermining the Interinstitutional Agreement and let me assure you that we shall consider whether or not we intend to have a part in this next year.

Virrankoski
Mr President, firstly I would like to thank the budget rapporteurs, Mrs Haug and Mr Ferber, for their excellent work. The same goes for Mr Wynn, the Chairman of the Committee on Budgets, for the splendidly accomplished conciliatory work he has done and for his constructive leadership of the committee.
Next year' s budget will be very much based on strict budgetary discipline. Although agricultural expenditure, which accounts for almost half the entire budget, will increase by more than 5%, when the Letter of Amendment has been taken into account, the overall increase in the budget is just 3.5%. This means that great restraint has been shown in the use of funds in the other categories. This makes just 1.056% of GNP, which must be considered very low as the ceiling for the financial perspective is 1.11%. This means a saving of more than EUR 2 billion. This, however, conceals a danger. The budget will be seeing a structural distortion, as money spent on payment commitments comes to over EUR 3.6 billion more than that for appropriations for payments. This means that there will be an increase in arrears. For that reason, Parliament' s concern that the problem of arrears will have to be dealt with is a justified one, and that is why there has been a very real need for a joint declaration by Parliament and the Council.
Furthermore, the fact that the Council and Parliament reached agreement regarding the EU' s budget for next year is to be greeted with satisfaction. It shows that both budgetary authorities are taking responsibility for the administration of the EU in an appropriate manner. However, it is unfortunate that Parliament once again had to fight with regard to funds for the West Balkans. Regarding other matters, I would say that for my group it is a positive move that a 450 million euro multiannual programme was agreed for the employment initiative; and, moreover, that it was agreed that funds remaining unspent from Community initiatives - totalling EUR 1 600 million- would be budgeted in the years to come. We failed to fill a considerable number of parliamentary posts throughout this year. This shows that in future there must be better use of personnel resources. With these observations, my group is prepared to adopt the draft budget.

Rühle
Mr President, I too wish to thank the rapporteur and, of course, the Commissioner and the President-in-Office for their excellent work. Our group will also vote in favour of this budget because it shows that, once again, we have reached an exemplary compromise, despite being under increasing pressure. The main sources of this pressure are unemployment, the BSE crisis and the Balkan stability pact. We have resolved and reached satisfactory compromises on all these urgent problems - and never once to the detriment of the interests of the EU. We wanted to secure the EU's ability to act and the confidence of the people. Nonetheless, I should like expressly to agree with Mr Colom i Naval, who said earlier that the financial perspective has become more and more of a straightjacket, preventing any real planning, any real long-term planning. Constant use of the flexibility reserve is undermining the transparency of the budget and in time this too will lead to a loss of credibility.
Even the Notenboom procedure, whereby funds are transferred to critical regions, in this case to fund the Balkan stability pact, does not really guarantee a transparent budgetary procedure. It already looks likely that the huge risk of a clash between MEDA, Mediterranean rim projects and the Balkans will increase over the next few years, despite the fact that we all know that this is where money is urgently needed. On the other hand, we are also aware that the Council is perfectly capable of suddenly questioning the financial perspective when it comes to BSE, when it comes to national interests. I found Mr Chirac's statement at the Nice Council extremely interesting. I think the Council urgently needs to consider how it, for its part, intends to handle the financial perspective. In all events, Parliament will be a much tougher negotiating partner next year.

President
Ladies and gentlemen, we are suspending the debate at this point in order to hear the President of the Republic of France and of the European Council. The debate will resume when appropriate according to the agenda.

European Council/ French Presidency
President
Ladies and gentlemen, I wish to welcome Mr Jacques Chirac, President of France and President-in-Office of the Council,

and the next item is the joint discussion on the report by the European Council and the Commission statement on the European Council meeting in Nice and the statement by the Presidency-in-Office of the Council on the French Presidency' s term of office. I am delighted to give the floor, without further ado, to President Chirac.

Chirac
Madam President, ladies and gentlemen of the European Parliament, I am delighted to be with you here today to present an assessment of the French Presidency of the Union and also to consider the progress that has been made over the last few months.
You are all familiar with our aims. I discussed them in this Chamber on 4 July. I think that we have been able to fulfil our commitments, although you will be the judges of that. I am also aware that this outcome certainly owes a great deal to the contribution made by the European Parliament. I have just returned from Nice after four days of intense negotiations, led by my Prime Minister and the members of his government. Today I join you, the representatives of the European peoples, to tell you the results of the Intergovernmental Conference on institutional reform.
The stakes were high and we feel satisfied that we reached an agreement that would have been impossible three years ago. We feel satisfied that we overcame the difficulties blocking the path towards the much sought-after aim of fulfilling the commitments that were given at Helsinki to the candidate countries without destroying the Union, of enabling tomorrow' s Europe to continue to function effectively. I think I can say that we met these conditions.
I am quite aware that the Treaty of Nice does not fulfil all of the European Parliament' s desires, but I do believe that this treaty is the best agreement possible, given the existing constraints. It responds to the challenge we were presented with, which was to provide the Union with the ability to take decisions and to act once Europe has gone ahead with enlargement on an unprecedented scale. It is a balanced agreement and although the negotiations were tough, as you know, there were neither winners nor losers.
In Amsterdam, three and a half years ago, it proved impossible to achieve the tricky balance between being representative and being effective. We were able to achieve this at Nice, as a result of the efforts made by all the Member States. It must be said that some agreed to make more of an effort than others and we must pay tribute to them for that. We must also pay tribute to the European spirit, which finally enabled us to leave Nice having resolved those issues left over from Amsterdam and having paved the way for the future.
As we promised, there are no leftovers from Nice. We were concerned that the Commission should remain a strong institution within the Union, capable of making ambitious proposals. In deciding to abolish a second Commissioner, and in deciding on a varying upper limit for the number of Commissioners when there are less than 27, with a scrupulously fair system of rotation, the Treaty of Nice guarantees both the Commission' s task of embodying the interests of the Union and also its effectiveness.
This effectiveness will also be achieved by means of the new powers that have been given to the President, who will now be elected by qualified majority, which constitutes real progress. I know that Parliament considered the number of areas in which qualified majority voting will apply to be one of the priorities of these negotiations. This also proved to be one of the thorniest issues, but progress was made. I am talking about real progress, even if it does not go as far as the presidency - which, I should point out, has shown great openness at national level - would have wished.
When you consider the results of the Nice Summit, I would ask you not to underestimate what has been achieved. Thirty or so additional measures were switched to qualified majority voting and we made progress on justice and home affairs, external trade and cohesion, all chapters about which several Member States had major reservations at the beginning of the negotiations. The presidency regretted the fact that the same consensus could not be achieved in the fields of taxation and social affairs.
The agreement reached on the issue of the number of Member States' votes within the Council is a balanced one. Reweighting was made necessary by enlargement, but it also takes account of the legitimate concern to see Member States with a smaller population continuing to make their full contribution to the workings of the Union, a contribution that is crucial. I would add that the democratic legitimacy of the Council' s decisions will be guaranteed and that the Council will be able to function properly. The mechanisms that are implemented, be they the demographic verification clause or the so-called "majority of States" clause, will not affect the Union' s decision-making abilities.
I now come to one of the most positive outcomes of the IGC. This concerns the procedure for enhanced cooperation, which has, to a large extent, been made possible under the first and third pillars. This cooperation will always be open to everyone. It will, of course, take place in full respect of Community legislation and the institutional framework. By making this cooperation more flexible, however, we are enabling it to be used properly. This therefore provides us with a guarantee that Europe will be able, no matter what happens, to forge ahead rapidly. The opening up of enhanced cooperation under the second pillar is also a step forward.
I would also highlight the fact that this IGC resulted in an extension of the powers and competences of the European Parliament. The new mechanism provided for in Article 7 on the warning procedure in the field of fundamental rights gives a major role to your institution. A new legal basis has been laid down for the status of European political parties and Parliament has been given the status of institutional plaintiff laid down under Article 230 of the Treaty. These are notable advances, even though I acknowledge that progress in extending codecision falls short of your expectations, and of those of the presidency.
Finally, in addition to the IGC, the need was felt to engage in a rigorous debate on a few issues that are crucial to the future of the European Union. The further ahead Europe moves, the greater duty we have to strengthen its democratic legitimacy, the clarity and transparency of its institutions and to clarify the distribution of competences between the Union and the Member States. Only by so doing will Europe be able to respond to the aspirations of its citizens.
With a view to achieving these objectives, a study on the future of Europe will be carried out, as decided by the European Council. The European Parliament will, of course, be closely involved in this. This study should be concluded in 2004. We will thereby be responding to the concerns that have been expressed very forcefully in recent times. This process will by no means constitute a precondition for enlargement and will therefore not delay this project. These are, in short, the results of the institutional work carried out in Nice. They will take Europe forward and I am delighted that the candidate countries have welcomed them so positively over the last few days. This positive response bears witness to the fact that we have met their expectations.
After all, enlargement is clearly the major issue facing Europe today. It is both a huge challenge and an historic milestone on the path towards the reunification of our continent. The French Presidency has lent all its support to the progress of the negotiations. Thirty new chapters were closed, including some in the most complex areas of Community legislation, and some countries, which have only just entered into negotiations, are already demonstrating their ability to catch up with the longer-standing candidates. In Nice, on the basis of the excellent work carried out by the Commission, we gave ourselves a travel permit for the next eighteen months. This is proof that the Union intends to forge ahead. This is a powerful signal, which was given a very positive welcome at the meeting of the European Conference last Thursday.
In the last six months, Europe has also made progress in the field of growth and employment. We have continued to deepen economic and monetary union, we have improved the coordination of our economic policies within the Eurogroup and have speeded up our joint preparation for the entry of the euro into the daily life of the European public. In the last three weeks, progress has been made in three major areas.
First of all, the conclusion of the long-standing and difficult negotiations on the tax package, including savings tax and, secondly, the adoption of the European Social Agenda following a lengthy consultation procedure, particularly with our social partners. The Union has thereby given itself a working programme that sets objectives and meetings for the next five years in the fields of employment law, social protection, mobility, lifelong training and the fight against discrimination and exclusion.
Finally, the adoption, not without difficulty, of the social chapter for European society took place at Nice. This is the culmination of a project that dates back thirty years. The French Presidency is delighted to have been able to unravel the threads of these negotiations.
Next, the Union has begun to implement the Feira decisions on the new economy and growth. We agreed on a significant lowering of Internet access costs. This has been done. The Union decided to divide up access to the local loop. We wanted to introduce a Community patent and the Union has given a commitment to establishing one and is including the necessary legal measures in the Treaty.
Ladies and gentlemen, France' s ambition for its presidency was also to respond to the concerns of the European public. In Nice, we proclaimed the Union' s Charter of Fundamental Rights, a text of very great political importance. Its significance will be assessed in the future and I wish to pay tribute to your Parliament which contributed so greatly to its drafting. As a result of this Charter, our Union will be stronger and have greater guarantees of the values of dignity, freedom and solidarity that are its cornerstones. We shall now echo this as widely as possible and very shortly consider its status. I realise how much importance your Parliament attaches to this Charter.
Under this presidency, the Union has also given a new boost to cultural and student life in Europe. Two months ago, our Education Ministers adopted an action plan for mobility - a forty-two point action plan - and we agreed on a substantial allocation of EUR 400 million for the Media-Plus programme, which is so important for European cinema and audiovisual services and which - as you will be aware - the whole profession was hoping for.
Perhaps you remember that I mentioned in this very Chamber France' s desire to ensure that the Union took greater account of the specific characteristics of sport and its social function. This is the purpose of the declaration adopted at Nice and of the study that has been commissioned to coordinate the fight against doping at European level.
If we are to instil the adventure of European integration in people' s hearts we must also ensure that this union that we are building keeps its human face. We must preserve the things to which every citizen is legitimately attached: a familiar environment, the balance of our territories, and a good quality of life, by which I mean services of general economic interest. The presidency welcomes the fact that the discussion started within the Commission and the Council led to the adoption in Nice of a declaration that emphasises the crucial role of these services in maintaining Europe' s social and territorial cohesion.
Finally, in the course of the past six months, the presidency has firmly committed itself to making Europe respond better to the security needs of our citizens. The presidency has one ambition, which is to be more protective, in the best sense of the word.
In Nice, therefore, we laid the foundations for an independent food safety authority. The consequences of the mad cow epidemic are, of course, on everyone' s mind. What was needed first and foremost was to re-establish consumer confidence by means of immediate measures, which were vigorously advocated by France and adopted at the last Agricultural Council, such as the ban on meat meal in animal feedingstuffs and the widespread use of screening tests for BSE. Nor should we forget breeders and all the professions in the cattle industry that have been profoundly affected by this crisis and we have clearly highlighted this fact.
Something else that is also on everyone' s mind is maritime safety. A year ago, the Erika ran aground off the French coast and despite the amazing mobilisation of charities and the authorities, the coast is still suffering the consequences of this shipwreck. A few weeks ago, the chemicals tanker, the Ievolo Sun, sank just off the Channel Islands. There must be no more occurrences of this type of disaster, which is caused by human negligence.
Over the last few months, the study of the Commission' s excellent proposals has made considerable progress. Your Parliament gave a firm commitment, on 30 November, to a preliminary package of measures which, next week, will be submitted once again to our Transport Ministers. The Swedish Presidency, one of whose priorities, I would remind you, is the environment, now has the task of concluding the second batch of proposals, which includes in particular, the creation of a European maritime safety agency. As a quite exceptional case and in view of the urgency of the situation, the Nice Council urged the Member States to implement, in advance and as a preliminary stage, the aspects of this mechanism which will be subject to a political agreement.
As everyone knows, another threat we face is global warming. At the Hague, the European Union rallied together to reach a credible and effective agreement, in line with the urgency and the importance of the issue. We were able to demonstrate our coherence on the Kyoto commitments. We will ceaselessly continue our efforts to convince our partners to commit themselves too. Next year, we are due to conclude an agreement which will finally stipulate the necessary reduction in greenhouse gas emissions.
The Union has also made progress in the fight against organised crime: we now have a directive on the fight against money-laundering, concerted action has been taken against non-cooperating countries and territories identified by the Financial Action Task Force, Europol' s competences have been extended to the fight against dirty money and a European Police College has been created. These are the main aspects of a coherent and broad range of measures.
This is the backdrop against which the provisional judicial cooperation unit "Eurojust" was created, foreshadowing the body for judicial cooperation in criminal matters whose creation, due to take place next year, is already included in the Treaty.
Finally, the French Presidency fostered an international ambition for Europe, a long-term ambition, which was to give the Union the means to assert itself in major world affairs, to have its voice heard and to be able to act. This is the draft common foreign and defence policy. The French Presidency also fostered a more immediate ambition, which was to show straightaway the political determination of the Fifteen to assert their own interests when European issues are at stake, and I am thinking here of south-eastern Europe in particular.
With regard to these two aims, we have indeed made progress. First of all, at Nice we concluded the round of negotiations begun at the Cologne and Helsinki European Councils. We set objectives for ourselves and they were achieved. A year ago, we defined the military capabilities that the European Union should have by 2003 in order to be able to prevent and manage the type of crises envisaged by the Treaty. The Member States then committed themselves to providing a contribution in terms of armed forces and military resources. In addition to the troops themselves, the European Union will have the necessary resources for command, planning and intelligence gathering to lead complex joint army operations. The Union intends to use this military wing in complete harmony with NATO facilities and, if necessary, with their support. By making itself stronger, Europe will clearly be strengthening the North Atlantic Alliance.
Furthermore, at Nice, the European Union established the permanent bodies necessary to define and conduct a common foreign and security policy, which are: a political and security committee, a military committee and a European defence staff. The decision was taken to include the creation of the political and social committee in the Treaty, as this is the real mainstay of the system. Through delegation, the committee will be given decision-making powers when crisis management so requires. The revision of the Treaty on this point confirms the importance and the irreversible nature of the decisions taken in Nice.
We were also concerned, even before these bodies were created, that the Union should have a greater say on the major international issues affecting its interests. First of all, with regard to south-eastern Europe, we had to state more clearly what the aims and expectations of the European public were. I think that this message was fully understood at the Zagreb Summit, which, for the first time, brought together the countries of the Western Balkans and the Fifteen. The prospect of membership of the European Union was offered and every country saw that this path was also the path of peace, of human rights and of regional cooperation. Admittedly, the Zagreb Summit did not solve all the problems, but it set a course to follow by means of the process of stabilisation and association; it consolidated the progress of democracy and defined a prospect which is in line with the values underpinning European action.
Furthermore, the Euro-Mediterranean Summit in Marseilles demonstrated, despite, unfortunately, the crisis is the Middle East, the importance attached by all the participants to maintaining and renewing the Barcelona process. We can welcome the fact that the Union was able to announce that it would be dedicating some EUR 13 billion to the process over a period of seven years, including, of course, the loans from the European Investment Bank.
Madam President, ladies and gentlemen of the European Parliament, I think that today I can say that in the last six months, our Union has gained strength from the process of preparing to welcome new members, to reunite the family now that we are all assured of being able to work together, to gain a firmer place in the hearts of our citizens in the fields of values, growth and employment, of solidarity, security and the preservation of the European social model and finally, to grow stronger and gain support on the international stage.
Credit for this progress must be given to all of the institutions. I wish to pay tribute here to the quality of working relations between Member States within the Council. I wish to pay tribute to the Commission and its President, Romano Prodi, and to his determination to bring the initiatives and projects listed in the Presidency' s programme to a successful conclusion.
Here, however, in this Chamber, on my own behalf, on behalf of the French Prime Minister and Government, I wish first and foremost to thank this House for its contribution. It was crucial that the European Parliament, which is the mouthpiece for the European public and its ambitions, played a full role in taking the decisions that will affect the future of all of us. France has been particularly aware of this. You have often seen Mr Moscovici and the other ministers because the Council Presidency spoke 68 times on policy during your part-sessions and to the committees. The French Presidency thanks you, Madam President, ladies and gentlemen, for this cooperation, for your support and also for the warm reception you have given us.

President
I wish to thank President Chirac and I shall give the floor straightaway to Mr Prodi, on behalf of the Commission. Mr President, I give you the floor.

Prodi
. (IT) Madam President, Mr President-in-Office of the Council, ladies and gentlemen, the December 2000 European Council will be remembered as particularly lengthy and particularly complex. This was always likely, given its agenda and indeed that is precisely what happened.
Positive decisions were taken at Nice, some of them long-awaited. The Charter of Fundamental Rights was solemnly proclaimed. I personally have no doubt that this is a seminal text and I would like to remind those who feel that it does not go far enough - and I know that many in this House are of this opinion - that it was drafted and conceived with care precisely with a view to giving it legal status.

Parliament and the Commission have already made it clear that, for their part, they intend to apply the Charter in full. Ladies and gentlemen, the original foundations of a European Company Statute were laid over 30 years ago. It is a legal instrument of obvious value which our operators had long been pressing for and which was sorely lacking during the major company restructuring we have experienced recently. I am happy to say that now there is no longer anything to prevent us from implementing it rapidly.
With regard to enlargement, the strategy proposed by the Commission was endorsed. The Social Agenda was also adopted, the fruit of productive cooperation with the Presidency, as has been pointed out.
The Commission's proposals on maritime safety and the creation of a European Food Safety Authority met with strong support, as did the decisions on our seven outermost regions.
These are some of the issues which were put before the Heads of State and Government. I would mention one other issue which I can sense will be of considerable importance: the Council also discussed the way in which the summits are organised. These events involve a huge amount of work, they are complex and they are held in a different place each time. The European Council took the wise decision to move gradually towards holding them all in Brussels. This will further reinforce the city's status as the capital of Europe
(Applause)
and, once the summits which have already been scheduled have taken place, one out of every two summits will be held in Brussels. Once the European Union has grown to 18 Member States, the decision will apply to all the summits. I sincerely believe that we should welcome this convincing initiative from Mr Chirac.
(Applause)
Moving on to the Intergovernmental Conference and the Treaty of Nice, I would first of all like to pay heartfelt tribute to Michel Barnier for his work.
(Applause)
He worked, as I did but to a greater extent, in collaboration with Parliament, particularly with Giorgio Napolitano and his Committee, with the two rapporteurs, Mr Leinen and Mr Dimitrakopoulos and, of course, with Mr Brok and Mr Tsatsos, whose commitment was total and absolute. Finally, Madam President, I would like to praise the truly exemplary clarity of your own speeches to the meetings of the Council.
As you will remember, Madam President, the last time that I addressed this House, just before the Summit, I said that we needed a treaty with genuine added value. In particular, I promised to return to this House with a frank assessment of the outcome. Moreover, in your own address at the beginning of the Summit, you said that Parliament would judge the success of Nice in terms of quality as well as quantity.
It will be a little while before we can make a full, accurate assessment of the progress made at Nice, but we can at this stage hazard a few observations. The first relates to the extension of qualified majority voting. This is a quantitatively important step forwards because it has brought 30 or so new chapters under this umbrella. As a result, qualified majority voting will increasingly become the general rule at the Council, and this must not be underestimated. Qualitatively, the same cannot be said. Little or no progress was made on the sensitive issues of cohesion, tax regulation and social legislation.
(Applause)
In fact, in these areas, the Conference came up against the intransigence of some Member States. This is something which deeply disappoints me, not just because of the short-term consequences but because the attitude behind it shows a lack of openness and understanding. Anyone who sees Europe merely as a "clearing house"
(Applause)
to approach when necessary and to stay away from when they cannot get what they want or once they have got everything they want from it is not just making an error of historical analysis but is cheating future generations, who have the right to expect much more from Europe.
This inward-looking backdrop of reciprocal failure to make concessions does offer some small progress on justice and home affairs, however, although it has to be said that most of this progress has been deferred until after 2004. This is not to belittle it. It does, however, mean that the speed of development of the major new policy area of legal matters and cross-border crime, which was adopted in Tampere, is now under threat, and that the Tampere "scoreboard" will start to show delays. I hope that these delays will not be blamed on Parliament or the Commission.
Lastly, I would like to take this opportunity to thank President Chirac and the French Prime Minister, Mr Jospin, for making it possible to put paid to the main ambiguities of our commercial policy. A good balance was struck between the legitimate concerns surrounding issues such as cultural diversity, in particular, and the effectiveness of our powers of negotiating with our trading partners.
Another source of satisfaction lies in the result in the field of closer cooperation. Ladies and gentlemen, I feel that what we have here is a tool that is vital for the enlarged Union, one that the Commission will make use of while taking care to play its "guarantor" role fully, firstly to make it possible for countries that wish to work together more closely towards major new common goals to do so, and secondly to counter any risk of fragmentation that unregulated use of such cooperation might bring.
On the subject of the institutions themselves I would like to say three things. Where the Commission is concerned, there has been sweeping, far-reaching change. The Commission will be able to grow to 26 members. After that, the necessary and much hoped-for alterations will be made. These changes have been accompanied by the launching of major reform of the way in which the Commission is organised. The President will be appointed by majority rather than unanimous vote. After the vote of the Commission, the President will have the power to dismiss Commissioners and a wide degree of discretion regarding the actual organisation of the Commission itself, for example in matters such as the assigning of portfolios and the appointment of Vice-Presidents.
Parliament's main gain is a statute for political parties at European level. The Commission defended - unfortunately with no success although the matter has not yet been closed - our shared concerns regarding the protection of the Union's financial interests by proposing that a Prosecutor should be established. However, it is worrying that MEP numbers are being used essentially to counterbalance the equilibria in the Council. Much greater attention will need to be devoted in the future to this and other related problems, and we must move from a defensive role to a more strongly proactive one.
Lastly, it was the weighting of votes in the Council that gave rise to the most difficult debate and the most difficult decision. This was inevitable given the approach taken, but the outcome was regrettable for two reasons: firstly because it made a qualified majority more difficult and a blocking minority accordingly easier, whereas logically, in an expanding Union, the exact opposite is required;
(Applause)
and secondly because it has made the decision-making process even more complex, which runs counter to the legibility and transparency for which the citizens are calling.
(Applause)
To respond to our citizens' demands, we had advocated a double majority as the only solution which is objective, comprehensible and widely supported by smaller and larger countries alike.
(Applause)
At this juncture, we must pay particular tribute to the Belgian Prime Minister, Guy Verhofstadt, who fought to the very end for a more equitable presence for the candidate countries and to set the qualified majority threshold at a less unreasonable level - although one that is still too high. He thus confirmed Belgium's great historic role in the European Union.
(Applause)
Madam President, ladies and gentlemen, we must recognise that the hard-won conclusion of the Nice Summit was an achievement in itself. A conclusion had to be reached and, thanks to the efforts of the Presidency, we got there in the end. There are no leftovers from Nice. The next step is to work realistically towards ratifying the Treaty as soon as possible. This will enable us to move on to welcoming the new Members, in line with the Helsinki conclusions. We must proceed resolutely in that direction.
Ladies and gentlemen, I feel - as President Chirac remarked - that the Nice Summit was characterised by the efforts of many to defend their own immediate interests, to the detriment of a long-term vision. Nice does, however, include a declaration on the future of the Union which gives me cause for some optimism. The Commission is aware of the importance of establishing a more precise division of competences between the European Union and the Member States. Incorporating the Charter of Fundamental Rights into the Treaties, simplifying the layout of the Treaties and reviewing the role of our institutions. This review must be an open, thorough discussion on a vast scale, involving the governments, parliaments and citizens of the current Member States and the candidate countries and demonstrating the dynamism of a Europe which is still being built. There is a great need for such a discussion for the experience of Nice shows that the current method of reviewing the Treaties is no longer a valid one.
(Applause)
Like the Community structure itself, the process being used to produce institutional change is under stress and needs to be changed. The Commission will come up with proposals for improving this process, and I am counting upon your participation and support.
Madam President, Mr President-in-Office of the Council, ladies and gentlemen, after these initial, incomplete remarks which I have tried to put to you objectively and with conviction, I would appeal to everyone to remember that the final objective of the Nice Summit was, and still is, the unification of Europe. The new Millennium has given us an unprecedented opportunity to bind together the countries of our continent in a wide area of peace, stability and economic growth. Nice is a step in this direction: a shorter step than we had hoped for, or indeed, could have made, but a step in the right direction all the same. I therefore ask you to lend us your support.
(Loud, sustained applause)

Poettering
Mr President, Mr Chirac, Mr President of the Commission, ladies and gentlemen, Mr Chirac, our Group of the European People's Party and European Democrats has always received you here in the European Parliament with the greatest respect, open-mindedness and esteem. The same applies today because we value you as a person and because your office so demands. We appreciate the fact that you were here in July and have returned here today, but the esteem in which we hold both you as a person and your office does not absolve us from honesty and we have a duty to express our convictions loudly and clearly today in your presence.
You said at the end of the summit that the Nice Summit would go down in the history of Europe as a major summit. Unfortunately, our group cannot concur with that.
(Applause from the right)
We witnessed an Intergovernmental Conference which dragged on for months, followed by a summit in Nice at which we felt, even as we watched on television, that the Heads of State and Government - and this is a perfectly human trait - had reached the end of their physical and mental resources. Allow me to cite an example: thank God, the awful proposal that Poland should have fewer votes than Spain, despite having the same population, was revised. What sort of impression would Poland have had, with its experience of national socialism and communism, had it not been treated on a par with Spain. Thank God this has been corrected.

Mr President, I mention this because proposals such as this arise in the maelstrom of a summit such as Nice but should never be repeated in the history of the European Union. We say today to the people of central Europe: you are welcome in our European Union and it was Alain Lamassoure's proposal, which then became our group's proposal, Parliament's proposal, the Commission's proposal - and thankfully you too have adopted it - that we ensure that the first central European countries are able to take part in the next European elections in 2004.
(Applause)
Unfortunately, we also witnessed the contrast between large and small countries over recent months - and this too should never be repeated, because it acts as an insidious poison in the European Union - with many large countries behaving most meanly and many small countries behaving most generously.
(Applause)
And we have seen with great concern over recent weeks and months, that governments are taking ever greater recourse to intergovernmentalism and governmental cooperation and I can only hope that the spirit of Pierre Pflimlin, Robert Schuman and Jean Monnet will be the spirit and vision which determine the future of Europe ...
(Applause) ... because we are firmly convinced that only a Europe of communities with strong European institutions can safeguard law, democracy, solidarity and peace for us on our continent.
Nice obviously had its good and bad points; unfortunately there were a great many bad points. However, our yardstick for Nice from the beginning was the European Union's ability to act. Commission President Prodi, whom we thank, together with Michel Barnier - because we have not forgotten, Mr President, that Mr Barnier is a member of the Commission on your recommendation and we do not only want to criticise - has pointed out that it is precisely in the fundamental areas that qualified majority voting has not been extended in the Council of Ministers. For the European Parliament, which was the winner in Amsterdam, there has been no increase in codecision by the European Parliament and this is one of the great failings of the Nice Summit.
(Applause)
I do not intend to comment further on the complexities of the decision-making process because Elmar Brok from our group will certainly do so directly. But we have not achieved greater transparency. We have hope for the future and we do also see the good side, such as your commitment to the foreign, security and defence policy and the increase in Commission posts. We take you at your word, President Chirac, and I was delighted to hear that you want to involve the European Parliament closely in the post-Nice process. We expect all the Member States of the European Union and their governments to configure a conference in which the European Parliament is involved and helps to set the agenda and the procedure. We take you at your word that this will happen and then we shall perhaps move together towards a brighter future.
We have heard many fine words. You rightly speak of transparency. Above all, we need transparency in the Council of Ministers and we are most concerned to see that even the secretary-general - Mr Solana is more of high representative than a secretary-general - is prevented by the Community procedure from performing his duties as secretary-general as he would perhaps like to do.
We were delighted to hear that the European Parliament will be fully involved in the post-Nice process. On this depends our final answer, whether we say yes or no to Nice. We want a post-Nice process in which the European Parliament is involved both in setting the agenda and in the decision-making process. If you secure this then we shall have the chance to work together in a spirit of trust. We shall have to keep a very critical eye on the Council over coming weeks and months in order to ascertain if it too is in a position to safeguard the transparency of which you spoke.
These will be our yardsticks and, like you, we hope to be able to do our job so that we, the European Union, with our values, are truly open to the people of central Europe, who suffered a long time under Communism and who now wish to join our Community. We must open the door, but decisions must be made so that the European Union is also in a position to enlarge.
(Applause)

Barón Crespo
Madam President, Mr President-in-Office of the European Council, Mr President of the Commission, ladies and gentlemen, finally the Summit concluded with a result. For now we have got out of the tight spot. Now we need to look at the text carefully in Parliament.
For now, Mr President-in-Office of the European Council, I can tell you what is on the Council web site, or at least what was on it at 10.00 this morning: the Treaty will be available when it has been approved. Please ask the Council staff to at least update the text. I think that 'something' was approved in Nice.

In any case, the fact that an agreement has been reached is an achievement in itself. Because it was not about residue, leftovers or ends to tie up from what was discussed in Amsterdam and not agreed on. It was about fundamental issues for the governance of Europe, and we can now start working on this.
We are taking your word on the content of the agreement but, from what we are gradually discovering, there is not much cause for satisfaction. It should be pointed out that, in principle, the aim of the Intergovernmental Conference was to improve the functioning of the Union in order to achieve enlargement. I am afraid that we have before us a compromise between national interests that has been hammered out all in one go, at night, which will make it even more difficult to make Community decisions in the future.
Not only is the unanimity rule being maintained in a few crucial areas, but we also now have three types of qualified majority. The level of 62% of the population has been replaced, according to some, by 71% and, according to others, by 73.49% in order to achieve a qualified majority. The percentage is so high that it amounts to re-establishing a veto, especially for the largest countries.
This is a step backwards that applies to all areas of Community life, and I predict, Mr President-in-Office of the European Council, that our fellow citizens - and I am afraid also the Members of Parliament and the Heads of Government - are going to have to go back to school for lessons in arithmetic.
(Applause)
We will have to look very carefully at the role that has been allocated to the Commission and Parliament in the Union' s decision-making process. If we want the Union to reflect the interests of all of its Member States and all of its peoples as a community of values, according to the Community method, the institutions that can guarantee this are the Commission and Parliament, acting within the framework of the Charter of Fundamental Rights. If those institutions are weakened and the Charter remains outside of the Treaty, how are we going to bring Europe closer to its citizens?
At the same time, the declaration on enlargement - which is a positive one - says that the applicant countries will be able to join the Union at the end of 2002, and the Heads of Government of the countries that are in negotiations have welcomed Nice. Now we have to take something into account: this is like when a child invites his friends to a birthday party and it is not sure whether there is enough room in the house or whether there is enough money for the food. We have to be responsible in our commitments.
How have we come to this situation? It is too easy to blame the President-in-Office of the Council, especially as the majority of the political families represented here are also represented in the Council. And we have come to this situation because the method of the Intergovernmental Conference no longer works.
How can the Union make constitutional decisions by staying up for three nights? What was the point of eleven months of Intergovernmental Conference, two conclaves and countless meetings of the General Affairs Council?
(Applause)
I would like to point out, by the way, Mr President-in-Office of the European Council, that this is paid for by taxpayers.
How can decisions that reflect the dual legitimacy of the Union be made by only one side? I would like to make an appeal to you: no more Intergovernmental Conferences behind closed doors.
(Applause)
In the declaration on the future of the Union - which I welcome on behalf of my Group - for the first time there is a mention of the need to renew its working methods: the need for a wider debate in which all the parties involved can take part. There is already such a method. It is the convention method: nine months, a happy delivery...
(Applause)
...while in Nice, we still do not know what the child is like. And I really think that we should use the convention method to determine the future of the Union.
To conclude, Mr President-in-Office of the European Council, Mr President of the Commission, ladies and gentlemen, it is certain that, as far as the subjects of Nice that you yourself, Mr Chirac, pointed out - the European Company Statute, the Social Agenda, mad cow disease, maritime safety - there are sufficient causes to say that the Summit was a success.
As far as the institutional matters are concerned, however, we will have to study them and make a judgment. Today, we cannot take a decision. We want to make a positive contribution, but now - and I will now conclude, Madam President - in order to live up to our ambitions, what we have to do is ask the Swedish Presidency to initiate the process of debate, in which we need precision timing, because it is what this Union needs, positively affirming our defence policy and developing the Community method.
This is the challenge that we now face.
(Applause)

Cox
Madam President, Mr President-in-Office and Mr President of the Commission, colleagues, my group welcomes the fact of the Treaty at Nice. That is my point of departure, because without a Treaty at Nice we would be in a significant political and institutional crisis; without a Treaty at Nice we would send a clear signal to candidate states that there were indeed serious obstacles in our path. Therefore the outcome is to be welcomed. With regard to the content of the Treaty of Nice, as others have said here today, we must reflect, we must see the texts, we must form a considered judgment.
I can say that there are parts we like and much about which we are concerned. The ambition which was taken to Nice was the greatest European ambition for a summit meeting now for many years. It was the ambition to prepare the way for a continental-scale enlargement in Europe and that is the test by which we must judge the content at Nice. Is it capable of delivering an effective operational continental-scale enlargement? That was the ambition, and many in this House fear that it may have fallen short of what was required.
My group has nonetheless reached one definitive conclusion which others have also referred to today. That is that the current intergovernmental model of deciding these things reached and passed its sell-by date with Nice. After nine months, more than 330 hours of preparation in formal sessions, thousands of hours of preparation surrounding those sessions, it ended up in the spectacle of the extraordinary difficulty of the negotiators being stuck at the end still having to try to resolve everything because in all that had gone before, nothing of substance had been decided. That is not the way to do business for Europe, nor, in fairness to the French presidency, is it the way to ask any presidency to have to conclude such a complex process. We believe the time for change has come.
(Loud applause) I should also like to comment, albeit at second-hand having followed in the media the detail of what happened at Nice, about the general atmosphere surrounding the discussions. When we look at the progress which has been made on the reweighting of votes, clearly it is complex and difficult to explain, but the emphasis that was coming out of Nice in reports to the media from the various national delegations was how things could be blocked rather than how things could be promoted. The atmosphere had more to do with the negative aspects of a great European project and vision than a positive promotion of what is deep and good about the European dream, and that is a disappointing feature of Nice.

I want to salute the work of the European Commission. I want to salute the European fortitude of Romano Prodi. I want to salute the detailed work of Commissioner Barnier. I want to salute the European spirit of Mr Verhofstadt, the Belgian Prime Minister which held up to the very end at four or half past four in the morning. But those who stood up most for Europe, I think found it rather a thankless task and that is greatly to be regretted. I want to say for my group that when it comes to dealing with the European Commission, when it comes to the model that has made Europe achieve what we want to see, when we look at the dual legitimacy of the European process based on a Monnet method with a strong intergovernmental input, we do not see the European Commission and their advisers as petits fonctionnaires. They are central to our European politicians' mission and they are essential to that task.
(Loud applause)
There are tensions now. There is a creeping tendency towards intergovernmentalism. But the Schuman-Monnet method has helped us not only to create but to deliver the European dream. I would say to those who trample on that: do so with great caution because you trample on our dreams when you break up a method which has worked so well. I know some sceptics do not like it but they never will. The substantial majority in this House, however, believe in it and the substantial majority in this House appreciate why it has worked.
Finally, to contemplate the next phase 2004. I am pleased to hear President Chirac remark it will not be an obstacle to enlargement. I believe it will be an opportunity and we must grasp the opportunity also to raise the questions of reforming the Council, of reforming the method that we bring to these important tasks and to make sure that the Charter on Fundamental Rights becomes meaningful as law and not simply as a proclamation. This will give us a real opportunity to address the perceived shortcomings of Nice. I have listened carefully to what Romano Prodi has said. He said we must be ambitious but temper our ambition with reality. It is an important message and it is understood.

Lannoye
Madam President, Mr President-in-Office of the Council, Mr President of the Commission, I should like to give you a little history lesson, concerning a famous French doctor, whose name was Coué and who invented a method - the Coué method - based on the principle of autosuggestion and self-hypnosis.

This doctor suggested that every one of us should say the following to ourselves, when we get up in the morning: today I feel better than I did yesterday but not as well as I will feel tomorrow.
(Laughter)
I think that in politics, this is a valuable principle, but it should not be used too liberally. I welcome the fact that the various Members present today have not done so. I therefore welcome their speeches. I do not often feel this way but I am actually very happy with what has been said so far. My personal view of the Nice Summit is that it was a failure. I consider it to be a failure not only in terms of the European Union' s stated ambition to change the institutions so that they are capable of properly receiving the new Member States by improving the European Union' s efficiency, but I also consider it to be a failure in terms of another important aim, which has perhaps not been sufficiently highlighted, which is the rapprochement of the European Union and its citizens.
With regard to my first point, I think that everything necessary has been said on the matter. I would nevertheless like to mention a number of factors that concern the European Parliament, the European Parliament to which President Chirac very kindly paid tribute, but which has largely been forgotten in the Treaty of Nice.
(Applause)
For the first time - and I would remind you that I took part in Maastricht and in Amsterdam - Parliament has been given less weight in the European decision-making process. This is a very serious matter. Granted, the number of Members of the European Parliament has increased in relation to what had been envisaged, which goes a little way to allaying some of our fears, but the result will be more Members with fewer powers. I am not sure that this is a good thing.
(Applause)
I now come to my concerns for democracy and transparency. I should like to give an example with regard to transparency: Article 133 on commercial policy. I have not seen the definitive texts - no one here has - but I have seen three pages, annexes 5 and 6, on commercial policy. I read them three times and I promise you that I did not fully understand them. Perhaps I am not clever enough, but the truth is that I could not fully understand them. Nevertheless, I did understand one thing: the European Commission would gain power; the Council would increase its control and Parliament would be left out. In an area as sensitive, as politically sensitive, as this, for which there is popular support, I consider this to be a serious political mistake. I felt the need to say this.
(Applause)
There are many things I could say about codecision. Where is this codecision? Almost no progress has been made on this. This is also extremely serious. I therefore believe that, on this point, as Members of the European Parliament and as representatives of the public, we have a genuine obligation to show our annoyance and, politically, to translate our annoyance into positive action. This is what I shall be taking a few words to do. I think that what was lacking at Nice was a European vision.
(Applause)
This was completely absent from the Nice Summit. It is national governments that are responsible for this and I am not blaming any particular government here - and I am not blaming the French Presidency more than any other presidency, as this is not the time or the place to do so. Mr Barón Crespo was quite right when he said that we must challenge the whole intergovernmental method. Governments are responsible for their image in international national public opinion and must look after this image. This is quite reasonable, but nevertheless, they do not bother about their image where international public opinion is concerned. A few do, but many do not make any effort. We should be aware that this leads to considerable nervousness in European thinking. We must therefore find a new method. We have seen the limits, which have become clearer and clearer. We now have the beginnings of a process.
I am somewhat less enthusiastic than others about the Charter of Fundamental Rights. This has been described as a baby that is delivered at full term, but which is nevertheless a puny little thing. I had hoped for a healthy baby, and that is why we would need a method which is probably based on that of the Convention, but which has a much more ambitious mandate for the reform of the European institutions and above all, which functions more democratically. We cannot escape from having a widespread debate on the European Union' s objectives, on the European Union' s ambition on the world stage.
(Applause)
That is what I hope for. I take genuine pleasure in the consensus that I feel exists in this House. This is the first time that our analyses of the situation converge so strongly and I think that this is a positive indication for the years to come.

Wurtz
Madam President, Mr President of the Republic, Mr President of the Commission, ladies and gentlemen, my group takes a very dim view of the Fifteen following the rather unappetising spectacle they put on for the European people, who were probably amazed to see on that occasion, and at first hand, the real common vision, sense of solidarity and mutual trust that exists between the major European leaders. Although, despite everything, I welcomed the conclusion of an agreement with a certain amount of relief, I did so because, as Mr Cox said, a failure at Nice would have been used by the shameless opponents of enlargement if not to sound the death knell, at least to call for the indefinite postponement of this great project. We would then have sent the peoples of Central and Eastern Europe a signal of incalculable political consequences. There is nothing less secure today than a successful enlargement but at least the way remains open for action in favour of such a prospect.
Besides, what a cruel illustration of the crisis which is not only institutional, but which, at a deeper level, is an identity crisis for European integration in the face of the titanic issues confronting the European Union! The problem facing the Fifteen lies, I believe, less in their difficulty in providing sound responses, than in their refusal to address the right questions. We feel that the right questions are those on the lips of the impressive human tide which converged on Nice from all over Europe on the eve of the Summit.
This was not a handful of troublemakers from the margins of society but workers who were uniting with the most representative waves of public opinion in their respective countries. Some of them were supporters of the beginnings of European integration and probably voters - men and women - from most of the political families represented here. Beyond their differences, all their questions in one way or another concerned a fundamental issue: the purpose of this integration whose institutions we wish to reform.
For whom is it designed? What is its point? Where is this Europe of the Fifteen headed today, and even more to the point, the great Europe with twenty-seven or thirty, tomorrow? Is it condemned to collapse under the current system of liberal globalisation? Is its purpose to speed up the process of deregulation? To make competition the be all and end all of their economic policy? To try to destroy everything that is the essence of our societies through the rationale of commerce, to the point that people need to rally together to achieve a few exceptions and to concentrate all the power at the top, far from everyday life and far from the people?
Is there any more relevant question than that of whether other choices are conceivable? Choices in which most members of the public can recognise themselves? Major joint projects in Europe itself and on the international stage, in which they would find reasons and pleasure in committing themselves together, projects designed to achieve a shared dominance of the markets, a common, proactive political approach in the economic, social and cultural fields, real access for social actors to the necessary information and to the decision-making and control procedures, from their company to the institutions. What preliminary answers to these legitimate questions did the Nice European Council give the public? The Charter of Fundamental Rights, which was supposed to be a figurehead for this summit was dispatched without ceremony.
Neither is the European defence force, along with the military language that has accompanied its miraculously rapid creation, able to give the European adventure the boost that it needs. Symptomatically, it is in the few areas in which the demand for concrete measures had been clearly demonstrated in our societies that a few positive agreements have finally been reached between the Fifteen. I am thinking of food safety, maritime safety, the declaration on the specific nature of sport with regard to competition rules or even the European Company Statute. With regard to the Social Agenda, although we would be hard pushed to find the specific objectives that we hoped for, at least it offers elements that will provide support for action in the next five years. That may be true, but this does not make a project and unless there is a common project, institutional reform could only lead to a form of soulless and unceremonious inter-State horse-trading.
To conclude, I share my group' s view that the Nice European Council will ultimately have been the turning point for a kind of institutional and political construction that has shown its limitations and has reached the end of its useful life. The absence of a coherent, comprehensible, and inspiring common project, the refusal to hold a public and transparent debate on the various options due to an apparent consensus, which is inevitably liberal and hostile to any sign of independence from the established order, the exacerbation of violent relations between partners from the same Community and the excessive concentration of power in the leadership of States over the heads of their citizens - these are all issues that are not recent but which are now undeniable in the open debate on Europe' s future. Thank you.

Pasqua
Mr President, I should first of all like to congratulate you on the marvellous stamina that you demonstrated at the Nice marathon. My congratulations must end there, however, as I am sorry that you did not apply this stamina to the subjects that were entrusted to you.
You said that the Nice Summit was a success because it finally led to an agreement. I would say to you, "big deal!" because everyone knew from the outset that the French Presidency was set on doing everything to ensure that an agreement was reached in Nice, largely for reasons of domestic politics. I wish to say, at the risk of destroying your illusions, that no one here has been fooled. The obstacles between the Fifteen that multiplied during the Summit are symptomatic. Any clear-thinking person can see that they herald the very serious consequences to which the project of a Federal Europe of 27 or 28 Member States is leading us. The most astonishing thing is that you are cobbling together this pipe dream at a time when the opinion polls suggest that the majority of Europe' s citizens are against this.
Speaking mainly on behalf of the French members of my group, I will say that there is a permanent contradiction between the virtues attributed to this Europe and the aberrations seen in the daily workings of the Union. Europe' s leaders, of which you are one, are reduced to carrying out increasingly frequent operations to manipulate the media and public opinion. The technique is now tried and tested: always put off for another time the burden of proof; take decisions that are void of content or which will not be implemented for a long time and finally present the whole business as a magnificent success. The Nice summit is to some extent the apotheosis of this sleight-of-hand strategy. First of all, the Fifteen signed the agreement on the sly and under the smokescreen created by the Charter of Fundamental Rights. This document is a monument of ambiguity and was presented by some people as a crucial text, which would be a prelude to a future European constitution, and by others, as a simple declaration of intent with no legal force.
This text has been exalted as the democratic progress of a citizens' Europe but no one has bothered, of course, to find out what the European public actually wants. You yourself, Mr President and your Prime Minister have presented this text as the triumph of French secularism and by Chancellor Schröder as the victory of German religious sentiment. All it took to achieve this was quite simply to have the French and German versions of the Charter not say the same thing. We should have thought about that!
The Nice Summit then adopted a European Social Agenda, but this document has no binding power. It simply sets a handful of objectives for the next five years, which the Member States are free to decide whether to pursue or not, depending on the policies they choose. Then the summit announced that an agreement had been concluded on maritime safety. Hallelujah! Is this a decisive agreement? Not at all. It is simply a decision inviting the Member States' Transport Ministers to agree on the measures needing to be taken. Let us add to this list of triumphs the announcement of the creation of a food agency that will not come into operation until 2001. To crown it all, the European leaders who met at Nice decided to open a new institutional project in 2004. This will - apologies for it being so minimal - clarify the European Treaties, the precise status of the Charter of Fundamental Rights and lay down the distribution of competences between the Union and the Member States.
There is clearly something rotten about the whole business. From evasions to pretences and from hypocritical agreements to sermons on the future, this Federal Europe is beginning to look like a house of cards whose roofs are growing higher and higher but whose foundations are quaking, because the real lesson of the Nice Summit is the enormity of the historical misunderstanding in which our continent has been mired since the Treaty of Maastricht.
The Member States do not have the support of the people because there is no such thing as a European people and they are therefore forced by public opinion to advocate their national interests with increasing fervour, even if this means changing the maximum number of Members of the European Parliament set by the Treaty of Amsterdam, which is already out of date, and even if this means increasing the number of European Commissioners to 27, even though the current Commission of Fifteen does not work.
Mr President, I also wish to emphasise that, after Nice, France appears once again to have been the clear loser. Because you are paralysed with the fear of having fewer seats than Germany in the Council of Ministers, you have definitively capitulated on everything else: on the number of French Members in this Chamber, which is reduced from 87 to 74 - oh, I agree, this would not be a big loss - whereas Germany will keep its 99 Members without losing a single one: at least for the sake of those who believe that this House serves some purpose, the number ought to have been maintained; on the so-called "demographic slice" principle, which gives a considerable advantage to Germany; on one of the two Commissioners in Brussels and on our right of veto in the very many areas concerning our vital interests.
The final result is preposterous. No one understands the operating rules of this labyrinthine system any more. It upsets almost everyone, beginning with those known as the smaller countries. The only clear outcome is that the European nation-states are on their way - unwillingly - to becoming nothing more than provinces within an authoritarian federal state, whose strategic and military objectives appear to be those of the United States. This will happen unless we oppose it. We must bring an immediate end to this insane abdication of the sovereignty of the European Nations. This is why, as far as we are concerned, we will ask the President of France to consult the French people at the appropriate time by means of a referendum on this Treaty.
(Applause)

de Gaulle
Madam President, ladies and gentlemen, the masochism with which French political leaders have, once again, allowed themselves to be ensnared in the trap of a Europe obsessed with complex, intricate manoeuvres is incredible. Having wallowed in cohabitation, these professional politicians have lain down in resignation over a treaty that they just had to sign in Nice as if Germany' s fate depended on it.
Portugal and Belgium have, on this occasion, had a greater influence than France, which conceded on everything and obtained nothing apart from preserving a vague cultural exception, which is a pretext for a new concept, which Mr Védrine has invented, for the sake of the cause, of a sovereignty that would be both national and exercised jointly. Even Edgar Faure must be turning in his grave!
At a time when these so-called leaders are incapable of transposing fifty or so directives except by edict, in other words, by decree-law, they are accepting, with straight faces, to reduce French representation in the European Parliament by around 20%, despite having given these representatives the task of protecting French interests under codecision.
As far as France is concerned, each of these Treaties is, unfortunately, worse than the one before, but they confirm the rationale of Maastricht, a fine example of Mitterrandesque finagling that is likely to end badly. And what about poor Mr Chirac, who believes what Gerhard says, in the same way that Jaurès believed in world peace!
Into what situation will all these people have dragged France when the European bubble bursts and the French have nothing in their mouths but the bitter taste of having been conned once again by their mediocre and self-serving leaders?

Saint-Josse
Madam President, Mr President, the Group for a Europe of Democracies and Diversities regrets the fact that the Presidency has not followed up the message that was sent to it in July. At Nice, it simply boosted the power of the technocrats.
The crisis within the Commission has not led to any reform of its role or of the way in which it functions. All that has been proposed to us is an increase of its President' s powers and I doubt that even this would have prevented the dysfunction demonstrated by the Santer Commission. The negotiations of the last few days have proved that it was nothing but a laughable process of haggling. People are fighting over power of influence and postponing the distribution of competences and the clarification of the European Union' s objectives until 2004, even though making everything uniform is still clearly the order of the day.
We are told of parity between the larger States but the division is confirmed with 27 additional seats being allocated to just one country. Enough hypocrisy! The right of each Member State to be heard within the Council should have been recognised in Nice. For this to happen, one vote is enough and would enable us to avoid the countless calculations of weighting imposed by qualified majority voting. Taking into account these interests and differences within the Council would have avoided the debates on the number of Commissioners to which each State is clinging.
When I hear a Commissioner calling for an end to the cultural exception and for the extension of qualified majority voting to Article 133 in international negotiations, I must state that, personally, the loss of one Commissioner would not be particularly serious.
This House ought to represent the expression of an elected majority that backs the decisions of ministers who, I would remind you, are answerable to their respective national parliamentary representations. You chose to follow another path. We find this truly deplorable and it will benefit neither Europe itself nor any Member State.
With regard to the Summit' s conclusions, I am stunned to see the discrepancy between the proclamations on the services of general interest and the dismantling of the postal service, which is on the agenda for this part-session. My fear is that the objective of full employment, which is part of the Social Agenda, may suffer the same fate.
As far as Europe' s image is concerned, this Presidency has been a failure. The common interest appears to diminish the signing of a treaty that is designed to provide solutions by transferring ever more sovereignty against the wishes expressed by the public. Furthermore, we could adopt the formula suggested by the Economic and Social Council and say that Europe is experiencing a serious lack of public debate. Sometimes out of convenience or as a matter of urgency, the issue is dodged or cut short and sometimes a debate does take place but the experts and the elites are often the only players that are heard, that are listened to and who really influence decision-making. The danger of this is that the public will feel alienated from the decisions that actually concern them directly.
My group is disappointed by this Treaty and is worried about the future that it holds for us and we will therefore use all our power to oppose it.

Hager
Madam President, President Chirac, I am delighted that you have found time today, in contrast to the previous occasion, to listen to my speech. I take it as a welcome sign of the fact that tensions have eased since then. While waiting for the outcome from Nice, I was put in mind of my old mathematics professor. Two out of four problems unsolved elicited a pitiless "unsatisfactory" from him. Until late into Sunday, it looked like Nice too might earn such a mark. Then a compromise was found. In essence, the total compromise is less than the sum of its parts. Nonetheless, from an Austrian point of view, it is a result we can live with.
I personally welcome, above all, the juridification of all stages of the sanctions procedure, especially the facility for the Court of Auditors to exercise control. As an Austrian I know what I am talking about. The rule of law has triumphed here over political arbitrariness. Many have complained about the lack of progress on qualified majority voting. I take a more relaxed view. The heads of state and government may have exercised restraint in certain areas, but at least they did not use their right of veto after long hours of negotiation just for the heck of it. On the contrary, their restraint was driven by serious problems and concerns and the result of informed national opinion, which cannot be swept to one side and must be taken seriously.
How can we make our citizens identify more closely with Europe if we do not heed their concerns? For many citizens, things are simply moving too fast. Many still have no sight of the port into which the European Union is supposed to sail one day. As far as I am concerned, deliberate, considered action makes far more sense than rushing into the fray. However, what is worrying in this situation, and this is something which both I and Mr Poettering have warned against, is that the instrument of reinforced cooperation may be used as a circumvention strategy in areas in which no decision can be reached by a qualified majority. This sort of approach would not only contradict the ultima ratio clause; it would, in my view, also represent a serious threat to the development of the Union.

President
Thank you, Mr Hager.
At this stage in the debate, I shall give the floor once again to the President-in-Office of the Council, President Chirac, who would like to respond to the speeches by the group chairmen, following which, President Chirac will leave us and Mr Moscovici will take over.
Mr President, I give you the floor.

Chirac
Madam President, ladies and gentlemen, I have, of course, listened with great interest to the comments made by all the groups through their chairmen' s speeches. I shall simply make a few comments and then leave Mr Moscovici the task of answering all the questions dealing with specific matters.
Having heard what Mr Poettering had to say, I wish to make a general observation. I understand and share the ambition of a Chamber such as yours, which is by vocation, by definition, to assert a vision of the Europe of tomorrow or even of the more distant future, and to ensure that ongoing impetus is given to these changes and to the implementation of this vision. I understand this perfectly as it is your role and I would even say, your function.
Then there is also, of course, the reality of the situation, the daily reality, the opportunity for the public represented by their governments to accept the pace of these changes and even their objectives. In the framework of European integration, I have been struck several times by the claim by a Head of State or Government that, "of course, we could take that path, but the fact is that the public in my country would not accept it" .
Incidentally, the political position of my own government is at stake in this matter. Beyond that, however, and more seriously, the accession process, whether adopted by means of a referendum or by parliament, risks sanctioning changes that have not been approved and which would consequently bring European integration to an end. That is the danger. I shall not mention any names of course, but certain Heads of State or Government say, with regard to sensitive issues, and rightly so because they are in the best position to understand them as the democratically appointed representatives of their people, what is acceptable or not to public opinion in their countries.
It is all very well to integrate Europe as quickly as possible, but if we come up against a refusal that threatens the whole structure and which leads to everything grinding to a halt, then this is not what we want to see at all. We must move ahead as quickly as possible, but we must take care to avoid obstacles that would drag the process out indefinitely. There is therefore a trick to carrying off this process, in which everyone must play their role. It is up to the governments, which are - I repeat - representatives democratically appointed by their citizens, to lead them and to see the limits that they can or cannot exceed and the pace that they can accept as a whole. It is up to others, mainly Parliament and the Commission, to provide the necessary impetus and to convince the public. In other words, we must make our minds up but we must also convince, as decisions that do not convince are not particularly useful.
I have simply tried to highlight all of the negative comments made about the outcome of the Nice Summit, because I know very well what would have happened if no agreement had been reached, which was a possibility right up to the last minute. Enlargement would have been halted, which would have been the worst situation in which we could have found ourselves. Our objective was first and foremost to put ourselves in a position in which we could enable enlargement to take place. Well, we achieved that objective. It is true that this does not fulfil all the ambitions that we might have, which are legitimate, noble, and justified and which I share, but the time also comes when realism must be applied, in one way or another.
This was a general observation, to which I shall add two more specific observations following on from what Mr Poettering said about the shortcomings of majority voting and the development of qualified majority voting. The Presidency regrets these shortcomings and itself had reservations and made a considerable effort to ensure that France made progress in areas about which it is particularly sensitive. I am sorry that not everyone was able to adopt the same attitude. Here too, however, there is the problem of the citizens concerned and of the responsibilities that their representatives may or may not assume. Let us not forget that, with regard to referendums, some countries have voted against whilst others voted in favour - I am referring here to Maastricht - and rightly so. There are, therefore, also constraints that must be appreciated.
Secondly, I do not want people thinking they can put it about - I do not know where you get your information, Mr Poettering - that one draft gave Poland fewer votes than Spain. There was a technical error which meant that, momentarily...
(Mixed reactions)
No, no, please, I was in charge of it. Irony on a matter like this is misplaced.
There was a technical error on one paper, momentarily. Actually it was a typing error, and the paper was immediately withdrawn and of course the right figures were put in. Nobody could have imagined that anyone - certainly not the French Presidency, everyone knows what close ties France has always had with Poland - was suggesting handicapping Poland by comparison with Spain, when their populations are just about the same. I needed to say that to stop false information getting about.

Mr Barón Crespo mentioned the Charter. The French Presidency is absolutely open about incorporating the Charter into the Treaty. Some countries are not in favour of that, as you know. It was never envisaged that this would be an item on the Nice agenda. From the start the issue was always to be held over to the next presidency.
Like a number of other speakers, Mr Barón Crespo also mentioned the defects in the method. First, I entirely endorse your support for the convention method, and I will tell you the whole truth: when I heard that the convention method had been chosen for drawing up the Charter, I was sceptical. I have to say that the facts have proved me wrong, because it has been a great success, and that means the method was a good one. I think so and I have taken the opportunity to emphasise that, at Nice especially. It should also be said that the way the convention is being chaired by President Herzog is absolutely exemplary, which also makes things easier, of course.
No doubt we do need to reform the method. And I know the Commission - President Prodi mentioned this just now - should be making some proposals on this. Certainly something needs to be done about it. It is not normal to work day and night, keep staff working when they have hardly had a wink of sleep for three days, and still hope to draft decisions or take decisions in a calm atmosphere. I think that is right. Obviously, there is all the advance preparation. It was not wasted because it meant a whole series of issues that had been dealt with earlier did not have to be raised at Nice. I am thinking of the tax package, the Social Agenda, and lots of other things. But in the end, on the essential points - and this is in the nature of things - the Heads of State and Government reserve the right to wait till the last minute to take decisions or accept compromises, and they will never allow staff to deal with those issues at an earlier stage. So there is a problem with the method and, as several speakers have said, it ought to be reformed.
Mr Cox paid warm homage to the Commission and I naturally endorse that homage. He also mentioned something President Prodi said, which I particularly endorse and which brings me back to my first remark: we must be ambitious, President Prodi said, but we must temper our ambition with realism. That is wise, and we must always remember it.
(Laughter)
Mr Lannoye talked about a setback for enlargement. What would have happened if there had been no agreement on enlargement? I think it is a bit extreme to talk about a setback there. Anyway, all the countries concerned were unanimous in approving what was done in Nice. He also mentioned reversal for the European Parliament. I listed the areas where progress has been made earlier. I am not going to go over that again. Perhaps we did not make as much progress as you were hoping for, but you know, there again, some countries had reservations. Still, there has been no reversal and the European Parliament can never have been - I think this can be said, I am speaking under the eye of the President and those responsible - can never have been as much involved and consulted as it has been during the French Presidency. I would just like to make that point.
Mr Wurtz mentioned the human tide in Nice. Not counting certain irresponsible troublemakers who, of course, turned up with intentions which had nothing to do with the progress of human thought, there was indeed excellent and extensive participation, for which the European Confederation of Trade Unions was largely responsible. That was not a problem; I think it was a form of participation in the general debate.
Indeed, we should try to ensure better conditions for a more general debate, which is more inclusive of civil society, if only to give our thoughts some oxygen. That is often difficult to do, precisely because people do not necessarily always have the same ulterior motives. But when it comes to globalisation, which calls for very broad public debate, we need to find ways to allow everyone to express their views somehow, in a calm atmosphere.
Globalisation is inevitable; it means considerable progress in terms of standards of living, social advances and economic development, which determines everything else. But if we are not careful, globalisation will also entail grave dangers like exclusion: exclusion of some countries, indeed a growing number of countries, and exclusion within the countries of a growing number of men and women. It will also entail considerable risk to the balance of our ecosystem, our ability to bequeath a suitable environment to our successors; it will entail dangers for development, notably because of modern communications techniques and cyber crime. These are serious dangers and it is our duty to control and humanise globalisation.
It is true that some leaders are getting a bit carried away here by the cult of theory and, one way or another, all shades of public opinion need to be expressed. On this point I recognise the value of the arguments set out by Mr Wurtz.
I am grateful to my friend Charles Pasqua who was kind enough to compliment me on my physical prowess. That does not surprise me and I thank him for it. What does surprise me is the philosophical direction of his criticism, because what is he really telling us? He is telling us that within these walls and at Nice we have taken empty decisions or decisions which will not be implemented for a long time. And he adds that we have decided on a handful of targets which the Member States are free to apply if they want to. So that should not worry you...
(Laughter)
... and that does not justify your claim that those empty and distant decisions, or those targets, whether applied or not, amount to an insane abdication of the sovereignty of the nations of Europe. There seems to be a contradiction there...
(Applause)
... that I cannot entirely resolve. But, after all, I do know and appreciate the subtlety of Charles Pasqua' s thought, I have known him a long time and consider him a friend. So I will have a good think and try to understand his argument.
(Laughter and applause)
Coming to Mr De Gaulle' s speech, I have to say that I am simply not capable of penetrating the subtleties and nuances of his remarks. So I leave the full responsibility for his assertions to him.
Mr Saint-Josse said there is a lack of public debate. I have already responded on that score and I fully endorse what he said about the need to improve public debate considerably. I will not repeat what I said, but it is true that citizens too often feel alienated from decisions taken in forums they do not know. That is one of the challenges we must take up.
Finally, I would say to Mr Hager that in my view the instrument of enhanced cooperation is a useful instrument giving Europe a dynamic, and lighting the way ahead as Mr Romano Prodi said just now, I think. Personally, I am very much in favour of it.
Madam President, ladies and gentlemen, thank you.
(Applause)

President
I want to thank President Jacques Chirac for being here this morning, and for his speech and his replies to the group chairmen.
(The debate was suspended at this point and resumed at 3.00 p.m.)

VOTE
Proposal on behalf of the Committee on the Environment, Public Health and Consumer Policy for a European Parliament and Council Directive [COM(2000) 568 - C5-0485/2000 - 2000/0235(COD)] amending Directive 80/232/EEC as regards the range of nominal weights for coffee extracts and chicory extracts

(Parliament approved the Commission proposal)
  
Recommendation for second reading (A5-0349/2000) by Mr Liese on behalf of the Committee on the Environment, Public Health and Consumer Policy on the common position adopted by the Council [8878/1/2000 - C5-0424/2000 - 1997/0197(COD)] with a view to adopting a European Parliament and Council Directive on the approximation of the laws, regulations and administrative provisions of the Member States relating to the implementation of good clinical practice in the conduct of clinical trials on medicinal products for human use
Barnier, Commission. (FR) Mr President, on the Liese report, I would like to confirm what my colleague Erkki Liikanen explained yesterday during the debate. The Commission can accept compromise Amendments Nos 28 to 43. It can also accept Amendments Nos 1, 2, 3, 6, 7, 8, 9, 10, 12, 13, 14, 16, 19, 21, 23 and 24. The Commission can also accept Amendments Nos 5, 11, 15, 17, 25, 26 and 27 in principle, but cannot accept Amendments Nos 4, 18, 20 and 22.

Liese
Mr President, could we please check before the vote that enough members are present in the Chamber to give us the 314 votes needed or if the other two reports should perhaps go first, because there has been some confusion as to how long this break is supposed to last. In all events, we must be careful not to upset the compromise which we have now reached simply because some members are unaware of the fact that we are about to vote.
On the subject itself, I have just one brief technical comment. This is a complicated subject. We must back medical progress and, at the same time, ensure that subjects are protected during trials. The committee accepted the report unanimously. Nonetheless, a number of proposed amendments have been tabled, as the Commissioner rightly says. They are compromise amendments designed to bring about agreement with the Council. The Council has asked us to accept the spirit of the report but to change the wording here and there. Hence these proposed amendments, these so-called compromise amendments from three groups. I think they reflect the views not just of these three groups but of other groups which have refrained from putting their name to them for technical reasons. I therefore call on the House to accept these compromise amendments and to reject the new proposals which have now been tabled by other groups so as to avoid jeopardising the compromise with the Council. Not because I am opposed to the proposals in principle but because I want to safeguard the compromise with the Council and avoid risking a complicated and tricky conciliation procedure for the sake of an amendment.
In order to make full use of this compromise, I should like to ask the presidency to vote on proposed Amendment No 22, which is scheduled right at the beginning of the vote, after Amendment No 43, because Amendment No 43 reflects the compromise with the Council, while Amendment No 22 reflects the committee's original position and should only be adopted if the compromise does not win a majority here in the House.
Before the vote on Amendment No 22:

Liese
Mr President, I just want to avoid any confusion. As we have already accepted the compromise, I recommend that the House vote against Amendment No 22. That will keep us in line with the compromise with the Council. Apart from that, thank you all for your support.
(The President declared the amended Common Position approved)   
Report (A5-0356/2000) by Mrs Honeyball on behalf of the Committee on Regional Policy, Transport and Tourism on the proposal for a European Parliament and Council Directive on summer-time arrangements [COM(2000) 302 - C5-0322/2000 - 2000/0140(COD)]

Sakellariou
Mr President, I should like to know if the European Parliament's jurisdiction for summer time has been newly acquired since Nice.

President
My dear Sir, I have not yet gone through the text finally adopted in Nice with a fine toothcomb but, off the top of my head, the answer is no.
(Parliament adopted the draft legislative resolution)
  
Report (A5-0355/2000) by Mrs Cerdeira Morterero on behalf of the Committee on Citizens' Freedoms and Rights, Justice and Home Affairs on the initiative of the Portuguese Republic with a view to adopting a Council Framework Decision on the standing of victims in criminal procedure [9650/2000 - C5-0392/2000 - 2000/0813(CNS)]
(Parliament adopted the draft legislative resolution)
Explanations of vote - Liese recommendation for second reading (A5-0349/2000)

Fatuzzo
Mr President, I voted for the report on regulations relating to the performance of clinical trials with a view to finding new medicinal products. Before I left Bergamo for Strasbourg, I told Mr Giuseppe Rossi, a pensioner from Bergamo about this, and he said that he was very happy about this regulation. However, he urged me to draw Parliament's attention - which I am very willing to do - to the fact that, when selecting the diseases for which it is intended to find complete cures by performing clinical trials on new medicinal products, priority should be given to diseases affecting the elderly, in particular, who do not have time to wait for trials to be performed, unlike youngsters who have all the time in the world. Therefore, priority must be given to the diseases affecting the elderly.

Thomas-Mauro
The Union for a Europe of Nations Group has supported Mr Liese' s report.
It was really necessary to simplify the plethora of legal and administrative arrangements applying to clinical trials in the Member States. Promoting the development of medicines in the Community is desirable because that makes it possible to give patients a better chance of benefiting from high-performance treatment.
Research also needs to be promoted into medicines for children, and the Health Ministers of the various Member States must rally behind it. Two-thirds of children' s medicines were in fact designed for adults. For lack of data, their marketing authorisation (MA) does not provide for use with children. So use in paediatric medicine sometimes falls under the heading of empirical individual prescriptions, and we need to promote the development at pharmaceutical laboratories of specific products prepared for children and their pathologies so that the doses and forms of the medicines are suited to their bodies.
Dr Liese' s report means we can establish shorter time periods, harmonisation of procedures, and above all, a high level of protection, especially for children. As a result of the determination shown by both the Member States and Parliament, laboratories previously discouraged by the complexity of clinical trials will perhaps find the courage to develop the market for children' s medicines, even if it is not yet big enough to provide a return on the investment!
Furthermore, the legitimate determination to protect patients who take part in trials at Union level is inseparable from respect for the principle of subsidiarity. So the conditions for consent must be very strict. In our view, trials on people incapable of giving their consent should be banned. Here Dr Liese' s determination to lay down stricter conditions for consent by persons incapable of giving it is interesting.
We think consent should be governed by national legislation. While it is appropriate to establish a set of rules to be taken into account, the Member States must retain the power to adopt stricter legislation, as France has done in this respect.
That would merely be an intelligent application of the principle of subsidiarity.
Honeyball report (A5-0356/2000)

Fatuzzo
Mr President, when Mr Enrico Perniceni of Locatello Imagno in the province of Bergamo, my home town, discovered we were going to debate this directive he said: "Mr Fatuzzo, I know that I am a very old man but I would like my time never to come. If my time does have to come, I would like it to be the same time throughout the European Union! I therefore ask you to vote for the motion" - which I did - "because it is right for Europe to have a European time to go with the European currency, the European Parliament and the European flag. In fact, I feel that it is right for all the States of the European Union to be on the same summer time" .

Martin, David W
I congratulate my colleague Mary Honeyball on her first report for the European Parliament.
Summer time should be a matter for the Member States but it is right that the EU should harmonise the start and end dates. I welcome the agreement to continue to begin summer time on the last Sunday in March and to end it on the last Sunday in October.
Given the planning needs of certain sectors such as transport, communications, tourism and computer and other technology I welcome the proposal to make these arrangements permanent subject to a Commission review every five years.

Sacrédeus
Summer time has, in practice, become normal time. There may therefore be cause for questioning the concept of 'summer time' when it relates to seven out of twelve months, that is to say the majority of the year.

Souchet
Do we really have to carry on with the change to summer time? It was brought in at the time of the oil crises, to save energy and has been extended to 2001?
First we should recognise that the advantages and value of the arrangement have largely vanished: the energy saving it was supposed to produce is completely unproven and merely symbolic.
On the contrary, in addition to atmospheric pollution problems, the profound disturbance to human beings, especially children, of this double time-change, taking place in March and then in October, is clearly established and greatly resented by the people, many of whom are calling for the cancellation of this arrangement which upsets the rhythms of life.
The report financed by the Commission to justify its proposal merely notes the inadequacy of the consistent data available and the contradictory nature of existing studies: so it does not provide any relevant grounds for maintaining the time change system.
Now, the Commission proposes to make the change to summer time, and then back to winter time, permanent with no limit date. It means to impose this on the Member States without the option of exemption, and on the candidate countries, without taking account of their specific geographic position. Nothing, not even time, must escape its standardising will! It must be the same time in Brest as in Brest-Litovsk. The advantages of time zones cannot possibly outweigh the benefits of standardisation! Long live the single federal time!
Yet the choice of time applicable in each of the Member States is always a purely national decision, by virtue of the principle of subsidiarity. The national governments must not give up that right. They must continue to be concerned about representing the will of the people who have elected them.
Instead of the one proposed by the Commission, the best solution would undoubtedly be to give up the summer time arrangement and keep GMT + 1 hour for the whole year, at least as far as France is concerned.
From this angle, I am glad two amendments were adopted by Parliament, one rejecting the Commission' s plan to apply the summer time arrangement for an indefinite period, and the other allowing the Member States, like the European institutions, to retain the option of reviewing this arrangement.

Schierhuber
Mr President, I should like to give an explanation on the Honeyball report.

President
I am sorry, Madam, but I have no record here of your application to give an explanation of vote. As you know, an application must be submitted in writing in advance. It is obviously an oversight but, as I am sure you will understand, I cannot make an exception, otherwise we shall get embroiled in Rules of Procedure.
That brings us to the explanations of vote on the Cerdeira Morterero report. Somewhat surprisingly, Mr Fatuzzo has the floor; I wonder which pensioner has said something to him this time.
Cerdeira Morterero report (A5-0355/2000)

Fatuzzo
You are going to be surprised, Mr President, for this time, before I left for Strasbourg, it was Mr Carlo Fatuzzo the tourist who said to Mr Carlo Fatuzzo the MEP - we talk to each other sometimes in the mirror - "Seeing as you are going to debate the issue of the protection of victims, remember that last year I went to Spain on holiday and, when I got out my wallet in front of the Sagrada Familia to make a donation in order to make my humble contribution to the conclusion of the work on this structure, both wallet and all the documents inside disappeared. I went to the Spanish police station immediately and reported the incident before you could say 'Jack Robinson'. But when I got back to Italy, Mr Fatuzzo," continued Carlo Fatuzzo the tourist, "in order to obtain another identity card and another driving licence, I had to report the incident again, this time to the Italian police. I had to report the same theft twice. Therefore, roll on the advent of this directive which will simplify the procedures!"

Figueiredo
The status of the victims in criminal proceedings is not always properly protected. This matter has been taken up in several Council of Europe instruments since the early 80s, but within the European Union it was not debated in the Council until 1998.
Since then, there have appeared first the Commission proposal, in the run-up to the 1999 Tampere European Council, which put forward a number of measures in the fields of the prevention of victimisation and victim aid and support and upheld the need to draw up minimum standards especially for victim protection and for the access of victims to justice and their right to compensation for damages, including legal costs, and secondly the Portuguese Presidency' s draft framework decision on the status of the victim in criminal proceedings.
This latter proposal is the subject of this report, which essentially warrants our approval, particularly as regards the simplification of access to rights, courts and legal information, and the promotion and protection of victims' rights in matters of compensation for loss and damages through redress mechanisms.

Malmström, Paulsen and Olle Schmidt
We are very much in favour of strengthening the position of victims of crime and therefore welcome in principle the draft framework decision presented by Portugal. Above all, we are in favour of setting up, at European level, principles for how the victims of crime are to be treated. Nonetheless, the Member States ought themselves to be responsible for working out the details. We believe, however, that a couple of questions need to be analysed more thoroughly and would present the following points of view.
Freedom of association is of fundamental importance in a democratic constitutional State, which is why we oppose a demand for non-profit-making organisations to be approved by the State before they are allowed to offer support to victims of crime.
We also believe that transparency is a prerequisite if authorities and courts are to inspire confidence in citizens, which is why we oppose general rules limiting the press' s ability to write about what has come to light in the course of a public trial. Only in a few clearly defined cases (relating, for example, to sexual crimes and crimes involving child pornography, where secrecy is required) may there be exemptions from holding open proceedings in court.
Finally, we think it may be a good idea for there to be video conferencing and other such facilities if there is reason for thinking that a witness or plaintiff might, out of fear or for some other reason, not speak the truth freely in the presence of the defendant.

Martin, David W
. I welcome this report by my colleague Carmen Cerdiera. The report aims to ensure that all victims of crime in any EU Member State should receive the same minimum treatment. Appropriate measures should be taken to provide crime victims with the following rights: to provide and receive information; communications facilities; participation in the procedure and access to free legal aid; a suitable level of protection and privacy; the possibility to seek compensation under criminal procedure and to dispute settlement through mediation.
The victim must be treated as a person in a particular situation of disorientation and distress - factors that are likely to be all the more acute if the crime happens to the victim in a Member State other than his/her own.

Tannock
. Although we support the content of the report and are very sympathetic to victims of crime throughout Europe, I, as a British Conservative, have reservations regarding certain aspects of the report. I believe we have adequate protection for such victims under Article 6 of the Council of Europe's Convention on Human Rights, and this report is yet another example of unnecessary proposed European interference into an area which is already covered by agreements between Member States, as well as 25 other non-EU members of the Council of Europe. The British Conservative Party does not support EU prescriptive measures to harmonise criminal law in the EU which must remain the competence of the Member State.

Titley
Madam President, I wholeheartedly support this report on better protection for victims of crime which demonstrates yet again in the EU's commitment to combating crime and protecting our citizens.
We are trying to ensure that the rights and interests of victims of crime are better respected in all EU Member States, even when the crime itself has been committed outside the victim's usual country of residence. Consequently, many travellers and holidaymakers will benefit from this European initiative. This measure will help allow victims of crime to be able to claim full, immediate and effective compensation for any damage suffered, if possible to be paid by the perpetrator of the crime.
Combating crime is crucial for my constituents in the North West. The Labour Government is cracking down on crime and disorder. With Labour, crime is already down 10% since 1997. Domestic burglary is down by 21% and vehicle crime by 15% - their lowest levels for a decade. The six-year decline in police numbers has been halted - 9000 extra recruits will take police numbers to their highest level ever. The Queen's Speech spells out that our next step is to cut violent crime and disorder by working together. The Tories, on the other hand, offer nothing but rising crime and falling investment. The Tories, on the other hand, offer nothing but rising crime and falling investment. Their record on law and order speaks for itself: during their time in office, the chance of being a victim of burglary increased from one in 32 to one in 13; the chance of being a victim of violent crime trebled.
Madam President, the Labour Government is determined to be tough on crime and tough on the causes of crime. By introducing greater protection for victims of crime across Europe, our citizens will gain confidence in the judicial system and the police, not just across Britain, but right across the European Union.
(The sitting was suspended at 1 p.m. and resumed at 3 p.m.)

European Council/ French Presidency (continuation)
President
The next item is the continuation of the joint debate on:
the report by the European Council and the statement by the Commission on the European Council Meeting of 7 to 10 December 2000 in Nice;
the statement by the officiating President of the Council on the French Presidency.

Bethell
Mr President, on a point of order. This has great relevance to the matter we are discussing since it touches on the freedom of the press and the independent ownership of the media in Russia. A few hours ago the owner of most of Russia's independent television, Mr Vladimir Gusinsky, was arrested in Spain. I am told he is due to be deported to Russia. I should like to protest at this most serious development and ask that investigations be made. Mr Gusinsky is presently in an aircraft on his way to Madrid where he faces deportation to Russia for criticising the Russian Government in his media activities.

President
 Lord Bethell, I think we would agree with you. We will look into the matter. We will make a note of it now and naturally we feel like you that the freedom of the press must continue to be observed in that part of the world.

Bayrou
Mr President, it is my turn to salute the President of the Commission, who is here, and the Presidency of the Council, which is coming, and to underline that there has probably never been such unanimity expressed in this Parliament on the results of a summit. This morning we heard every group speak of failure. If we look for the causes of that failure, the main reason seems to be that in Nice we saw the European project suffer a little more damage and the European dream recede a little further.
What is that dream about? It is not about a trading area. It is not even about a cooperation area. The European dream is about a continent with common values building itself into a political power. Put another way, it is about neighbours who regard each other as members of the same family, and decide to build a ship together to weather the storms. But that would mean recognising that the common project is more important than selfish interests. Now, in Nice - and this is the criticism we all have - the project was not being considered, only the interests were being considered. It is as if the ship were already built and we were at the stage of sharing out the cabins, the officers' uniforms and the cargo. That explains why many of us found Nice heartbreaking.
It was heartbreaking to see the debates concentrating on who would get one vote more or one vote less, and who would gain - Germany or France, the Netherlands or Belgium, Portugal or Spain. The only question that was never asked was whether or not Europe would gain. The results were heartbreaking. In future it will be necessary to assemble three different majorities for a decision to be taken - 75% of the votes, 50% of the Member States, and 62% of the populations. That is inexplicably Byzantine for the citizens. Heartbreaking results for the Commission which was regarded, not as the guardian of the general interest, but as yet another intergovernmental body, wrenched away from the collegiate rule and symbolically excluded from the 'confessionals' . Heartbreaking results for Parliament: the refusal to see majority decisions seriously extended; the exclusion of Parliament from codecision and - I say this in passing - the shocking fact that the composition was fixed without Parliament even being consulted on that composition.
Finally and above all, heartbreaking results for the citizens, who find themselves excluded once and for all from these carpet salesmen' s debates about a Europe where they are condemned never to understand anything. The European dream must be relaunched and the European project rebuilt. That will be the whole purpose of the third stage, the new stage we are entering.

Berès
Mr President, Mr President-in-Office of the Council, Mr President of the Commission, ladies and gentlemen, one image strikes us as we leave Nice behind. There are basically two Europes: one that works and one that asks itself questions.
The one that works is the one that has after all, it seems to me, spent the six months getting the work done in six essential areas, under the leadership of the French Presidency. Let us just note for the record the Social Agenda and the European company; strengthening Euroland and the tax package; the conference on commitment capability and the progress of Defence Europe; safety, whether in food or at sea; young people' s mobility and the recognition of the specific features of sport or the Media plus programme; and the important statement on services of general interest.
Yes, practical Europe continues to make progress, but what struck our fellow citizens at Nice was that the Europe asking itself where it is going and what it wants sometimes looks all at sea.
There is one piece of good news, certainly. Europe is now ready, thirteen years after the fall of the Berlin Wall, to welcome the Central and Eastern European countries knocking at our door. But as we said in this Parliament, a narrow agenda means the issues on the table have to be dealt with. It does not offer a way out. At Maastricht, we had the euro to dream about. At Amsterdam, we had the area of freedom, security and justice, and the employment chapter. But at Nice, there was nothing but the crude sharing out of power and then we saw national egoism on parade. There will be no Nice leftovers, but was there a European spirit at Nice? We are not sure there was. We all know there is a collective responsibility for this sad balance sheet, be it that of the 'small countries' or the 'big countries' , be it that of the founding countries or those joining later.
Nice will make enlargement possible, but without a plan, without a soul, without ambition, without vision. We can say what we like about the state of mind of our fellow citizens, but the responsibility is ours and they expect us to deliver this European project, this European dream.
I have a few comments to make, and the first is on the Charter. The Heads of State and Government sometimes give the impression that they almost took themselves by surprise at the Cologne European Council when they initiated a process whose results, in the end, would frighten them. How can we accept the fact that this Charter, which carries our dreams, hopes and ambitions, should in the end be proclaimed on the sly and that, at the end of the day, the only thing proposed for 2004 is an examination of the status of the Charter? There is no longer even any mention of its possible incorporation and, in the final analysis, the only institution to emerge from this exercise strengthened is the Court of Justice, which will be able to incorporate this Charter into Community legislation, even before the Heads of State and Government.
Then there is the issue of chief concern to this Parliament, qualified majority voting. How could we not express our disappointment? The scope of qualified majority is narrower than expected. On the essential issues of tax and social affairs, there is no progress. Things are more difficult because instead of just one criterion, there are three criteria to be fulfilled. Things are more complicated because there are these appeal clauses in the new Treaty, making the process even more incomprehensible to our fellow citizens.
From Parliament' s viewpoint, alongside qualified majority there is still the issue of codecision. For us, that is essential. It is sometimes caricatured as not being democratic, as taking too long, but democracy takes time, and time is necessary for debates. We call for that debate to be launched.
Sometimes, it has seemed as if, at the end of the day, in the conference, at Nice, the European Parliament was serving as an adjustment variable. But yes, Mr Bayrou, let us admit that we also bear the responsibility for that. We were not capable of expressing how we wanted Parliament organised.
On method, I think the Nice perspectives, from that point of view, are very interesting.
The Heads of State and Government have just recognised at Nice what we were saying after Amsterdam: the Intergovernmental Conference method is no longer successful for Europe. So we welcome the prospect of a new method and we trust that, with the hope offered by the possibility of enhanced cooperation, Europe will continue to advance and will be capable of drafting a constitution for tomorrow which restores our fellow citizens' confidence in this tremendous project that is the European adventure.

Duff
Mr President, despite what the President of the Republic says about the problems faced, in view of the spectacle at Nice, one must question whether the Union is really and truly prepared for enlargement. The candidates cannot have been pleased at the sight of the scramble for national power and status among the prime ministers.
Sadly the common cause of Europe was a marginal factor. For the decisions on Council voting and seats in Parliament a more suitable venue would have been the casino at Cannes rather than the Acropolis at Nice, with Mr Chirac playing the role of chief croupier.
Particularly regrettable was the failure to make reference to the Charter - a failure that will bring legal uncertainty and political frustration.
However, my greatest fear is that Britain, France and Germany will now be able to subvert the delicate balance developed between states of various sizes and between the institutions over several decades. We will resist this forcefully.

Maes
Mr President, Commissioner, Mr President-in-Office of the Council, as far as we are concerned, the outcome of the Nice Summit has not prepared the EU sufficiently for enlargement. In the twelve candidate countries, people prefer to talk in terms of the unification of Europe. That is quite revealing. We, i.e. many European citizens, grew up after the Second World War hoping that a united Europe would be able to play a part in the world some day for the sake of the freedom and welfare of humanity, of its own citizens and peoples. Yet this seems to be an even more distant dream than we had hoped now that Nice is over. After all, Nice was primarily an attempt on the part of the Member States to reach a settlement behind closed doors on the Amsterdam leftovers, with the safeguarding of national interests uppermost in their minds. But what they did not do was endeavour to equip the EU to pursue enlargement. Quite a number of speakers have made the same point this morning and I wholeheartedly agree with them.
As representative of the parties united in the European Free Alliance, I would like to alert the Commission, but particularly the Council, to the dangers, should the EU wish to be no more than an intergovernmental association. The States preparing for accession will copy the example of our own Member States' egoism. The regions and peoples that do not have their own state will also weigh the situation up. They will work out what they stand to gain in Scotland, Catalonia and Flanders if, instead of playing the federal game, they opt to become a Member State themselves, with a guaranteed Commissioner, guaranteed clout in the Council, and a larger number of seats in the European Parliament than they can hope for at present. Must we give up the dream of a united Europe? I think not. We are obliged to put our hopes in the post Nice process. We want this to be a real process in which the balance between the institutions of the Union and those of the Member States and the constitutive regions must be defined with respect for the subsidiarity principle.

Sjöstedt
Mr President, there is a quotation from George Orwell' s book, Animal Farm which, in a way, describes what happened in Nice. It reads, 'Everyone is equal, but some are more equal than others.' Translated into what happened in Nice, this could read, 'All EU countries are equal, but it is the large countries which decide' .
What happened in Nice was not only that the European Union' s large Member States set the agenda, but that they also brought about Treaty changes which guarantee them the same power in an enlarged EU. On the basis of the Treaty of Nice, an enlarged EU will become a Union which is more centralised and in which the small countries pay the whole price of enlargement. For the Swedish negotiators, it would appear to have been more important to please the large Member States than to fight for our own influence. Sweden is therefore to be given fewer votes than comparable Member States.
It is hard to see what there is in the Nice decisions which really makes enlargement of the EU any the easier. The decision-making process in the Council is to become more complicated, at the same time as it is to become more difficult to take decisions. Nice means more supranationalism and centralism, which are precisely what the EU did not need. The EU' s real problems are the lack of democracy and grassroots support, but those questions were not dealt with at all at the Nice Summit. I can also inform this Assembly that the results of a Swedish opinion poll were published today, showing that only 38 per cent of the population want to remain in the European Union.

Dupuis
Mr President, Mr President of the Council, Mr President of the Commission, ladies and gentlemen, we should honour the French Presidency, we should honour President Chirac. He was at the coalface, he fought and conquered for his vision of Europe - because he did have a vision. Congratulations too, to President Aznar, who won the 'Bingo' at the Nice Council. Congratulations to the British, who do not have to thump the table any more because they have found out how to stay close to the leader as we were taught to do by the great Dutch cycling champion, Zoetemelk: they cashed in too.
It is our Parliament and our Commission, Mr Prodi, that lacks vision. It was our Parliament and our Commission that failed to realise there was a plan to assassinate the Commission: the assassination of the Commission will take place in a few years' time. A Commission with a commissioner for each Member State sanctions the transfer of all the Commission' s important issues to the Council. That means the death of the Commission, and our Parliament would rather gnaw on the bones thrown to it at the Cologne Council than confront this fundamental problem: without a supranational Commission, the Europe we want will not come into being. There will be a Europe of nations, there will be no federal Europe.
This is our last chance. If we want to get back on the federal track, there is only one solution, Mr Prodi. It is the election of the Commission President by universal suffrage and powerful legitimacy for the Commission, and unless there is a real alliance on specific aims like those, between the Commission, Parliament and Member States like Belgium - which fought hard during this Council, represented by Mr Verhofstadt - then there will no longer be a federal Europe, there will be the Europe of nations which we have never wanted.

Krarup
Mr President, the fairly unanimous message from the President-in-Office of the Council, the Commission and heads of government is basically that the Treaty of Nice secures the framework for the unification of Europe. Some are happier than others about this, but the main message is clear: Europe can now be unified in an enlarged democratic EU which is also close to the people, thanks to the Treaty of Nice. These messages contain such huge and monstrous distortions of the truth that we have to go back to history' s most famous propagandists in order to find exact comparisons. For the fact is that what has been decided in Nice is enhanced cooperation, superpower domination, a Charter of Fundamental Rights, military development and the monitoring of democracy. What has been decided is unnecessary to enlargement, and what is necessary to enlargement has not been decided.
The Treaty of Nice contains a series of quite decisive steps towards an EU of élites, together with corresponding steps away from a Europe of democracies and of the people. Centralised power and superpower dominance are increasing drastically, as if we had not already had enough of these. Is this a unification and democratisation of Europe? No, it is an extension to the power of the élites and, in reality, the unfortunate agenda for Eastern Europe is, of course, subjection. It is we who decide about the applicant States. The EU does not negotiate with them. They are not involved in deciding what the Treaty of Nice will contain, and the EU dictates all the conditions of participation. Moreover, none - and I repeat, none - of the crucial problems associated with the enlargement project and involving the integration of incompatible social and economic systems are recognised as problems. The EU and the EU' s policy are not the solution, but the problem.

Brok
Mr President, ladies and gentlemen, I have little to say today. Just under a year ago, you sent Mr Tsatsos and me to attend preparations for this Intergovernmental Conference. Today I can tell you that our mission was a failure. Our remit was to help make the European Union more democratic and more capable of action so that it would be ready to cope with the enlargement which we so long for. It is not more capable of action - on the contrary. The decision-making mechanism in the Council of Ministers has become far more complicated and the hurdles have been raised. It will now be much easier to form a blocking minority in the Council of Ministers.
In the decisive areas in which we require qualified majority voting if the European Union is to be capable of action with 27 Member States, we failed dismally. On several counts we even lost ground. We have to admit that we have not complied with the principle of Amsterdam from the democratic viewpoint. Where qualified majority voting is enshrined in legislation, we have qualified majority voting. There are four fundamental areas, including structural policy, Article 133 and two other instances in which the European Parliament has been excluded from policy-making. In other words, the democratic deficit is now even greater. Plus, the number of seats in the European Parliament has been laid down against our own wishes and without consulting us. I find this situation intolerable.
Individual interests have prevailed. The winners are those who asserted their national interests. And they have all gone home to celebrate. No-one claims to have done anything for Europe; on the contrary, everyone is saying: I blocked something to protect my own national interests from the veto.
This method has seen its heyday, this system of a Europe of chancelleries is on its last legs. We need a transparent, democratic, citizens' Europe if we are to have any chance of developing. Our method must be a method which allows us to set up an Intergovernmental Conference through a convention at which parliamentarians, not chancelleries have their say if we are to take this continent forward. For the rest, when it comes to law-making, the future Council of Ministers must be an open, parliamentary organisation in which transparency and scrutiny have their place, because we cannot carry on as we are.
The only consequence which I can draw from all this is that, when it comes to voting on the Treaty of Nice, my vote will be a no vote.

Napolitano
Mr President, in the coming weeks we shall have to carry out a rigorous, in-depth analysis of the conclusions of the Intergovernmental Conference and the fundamental questions which it has thrown up. I will not go back to the comments of the different speakers regarding the method nor the other subjects such as those covered by Mr Brok just now.
Of the fundamental questions, the first is that the Nice conclusions do not guarantee on an institutional level the necessary continuity and the necessary development of the process of integration into the larger Union which is about to come into being. Therefore, even though we may not call them leftovers, the issues which were not adequately resolved in Nice will inevitably arise again. I refer to the changeover in qualitatively essential areas to qualified majority voting and to the very procedures for taking majority decisions. Time will show us which issues we need to return to, whether we like it or not.
The second fundamental issue is political rather than institutional. The atmosphere of the Nice Council, the lack of openness, as President Prodi said, the blinkered vision characterising the attitudes of the different governments - the narrow-minded defence of national interests or policies - explain, it is sad to say, the root of the problem: a serious loss of the sense of shared European interest, of a common European vision.
Well, the appropriate responses to both the institutional and political fundamental questions, which are our most negative legacy from the Nice Council, must be sought in dialogue, in the evaluation and development process which must be pursued under the title "the future of the Union". We must reflect seriously on what has happened. We managed to avoid an open crisis which would have threatened enlargement by coming to a last minute agreement on the Treaty, but we are left with a latent crisis which will have to be dealt with.
Building a unified Europe requires far-sighted vision and coherence. In response to President Chirac, we are not calling for haste; we are asking not to have to take one step forwards and then one backwards, not to call for promotion of the drafting and proclamation of the Charter when we do not then dare to include it in the Treaty, not to call for the new wording of the Convention to be produced when we then do not even dare to suggest it as a potential post-Nice procedure. We want the objective of constitutionalisation to be called by its name; we are asking for a response, with a clear, coherent vision of the future of Europe, to the disappointments and fears which are spreading amongst the citizens over the current or future nature of the Union.
Mr Prodi, Commissioner Barnier, this is our task. We have every confidence that Parliament and the Commission will proceed together in this direction, as they have done throughout this difficult year 2000.

Malmström
Mr President, the most important result from Nice was that, in spite of everything, there was a treaty, so that a place can now be prepared for the applicant States. Otherwise, the Summit was neither especially historic nor successful.
On behalf of the Group of the European Liberal, Democrat and Reform Party, I should like to discuss five points in the brief minute I have:
1. It is not acceptable for the large Member States to employ blackmail tactics against the small countries. This is contrary to the whole idea of the EU.
2. It is tragic that no further progress was made on the issue of qualified majority voting. Now, the EU is to become sluggish and powerless to act, and decision-making is to become more complicated.
3. Closed and exclusive, the Intergovernmental Conference is an old-fashioned and undemocratic method. The people must be involved in future.
4. The forthcoming constitutional debate must lead to simplification, distribution of powers and increased democracy. The EU must acquire a common constitution.
5. A new Intergovernmental Conference must not be used as an alibi for postponing enlargement. Our new colleagues must be allowed to participate in the discussions as new Members on equal conditions.

Frassoni
Mr President, President Chirac has played down the negative reactions of many of the Members to the outcome of Nice, describing them as unrealistic and not pragmatic.
In reality, it is the President who is being unrealistic if he thinks that it will be possible to enlarge the Union with such a Treaty. In my opinion, it is not more realistic to fight for one's own national prestige than to fight for the efficient functioning of the Union, and I would not say that huge numbers of European citizens came out to follow the naval battle fought by their leaders at Nice.
My feeling is that the French Presidency's most serious error was to run the debate along the lines of a battle of powers between States - a mean, shameless fight over details - rather than as a relevant debate on the Union's policies. Terrified of jeopardising France's equal voting rights with Germany, the Presidency docilely allowed its proposals to extend qualified majority voting to 40 or so subjects to be knocked down to less than half this number. Yet even the pro-Europe- States did little to fight for its cause and, in the end, bowed before a disappointing compromise.
As for the European Parliament, only the Commission defended its legitimacy and I therefore thank President Prodi and Commissioner Barnier for this, but they were alone in their endeavours and this was reflected in the final compromise.
We truly hope this will be the last Intergovernmental Conference, considering that the Summit revealed a breakdown in Community solidarity. The real winners in this Conference were Blair and Aznar, the Euro-sceptics. It is their Europe, the Europe of the market and the right to veto which has won the battle. Our Europe, the Europe of democracy and a sustainable future, lost.
There is one small ray of light although even that was mortgaged to the hilt by the French Presidency, and that is what is known as the post-Nice process. However, there are ambiguities which require urgent clarification. First of all, 2004 is too far away: we need to act sooner than that. We want a democratic process with the objective of a European Constitution to be defined by June and launched at the end of the year: the Charter took 8 months to draw up so a Constitution can be produced in less than 4 years. This is our next battle. I hope that, this time, the governments will fight with us rather than on the opposing side.

Cossutta
Mr President, we had said that a failure would be preferable to a disappointing conclusion. In practice, we did not fail completely, but neither did we reach a conclusion.
What came out of the Summit were contradictions and deferrals. The Charter of Fundamental 0Rights was proclaimed but has not been included in the Treaties and it will therefore not become legally binding immediately. The need for a European Constitution is greater than ever.
The principle of European military defence was accepted but, for now, its function has not been clearly defined. That can only be guaranteed by making it autonomous from the United States and moving on from NATO, which is now completely outdated.
The need for a social agenda covering employment, health, education, the environment and rights was mentioned, but nothing concrete was specified, not even the barriers to be overcome or how to overcome them to guarantee justice and freedom.
Finally, enlargement to the east and to the south was planned and promised. That is all well and good, but the institutional rules to make it operative have not been decided upon with certainty. Individual interests and privileges prevail. We are even further from achieving the Europe we want after Nice than we were before. The Council must start to take notice of the European Parliament, leaders must start to take notice of the national parliaments and the national parliaments must start to take notice of the views of their citizens.

Madelin
Mr President, Nice was, and should have been, a historic date, the kick-off for the new Europe, the Europe of the new century, the great Europe, the Europe of all the Europeans. And what a fine project, eleven years after the fall of the Berlin Wall! But for that, we would have needed vision, ambition, endurance, generosity of spirit, audacity. Alas, alas, alas!
We have long known that the great Europe could not be introduced through the institutions of the little Europe. We know we should think about Europe differently and we know we need new institutions. But, without a vision of the future, without knowing how to ask the right questions, we ended up with dithering, horse-trading and, finally, tinkering in Nice.
Before the Nice Summit the French Presidency was saying 'better no agreement than a bad agreement' , and this morning, unless I misunderstood, we were in essence told 'better a bad agreement than no agreement at all' . Certainly, the Nice agreement opens the way to membership for the candidate countries, but we are advancing down that road in the fog, foot on the brake, certain the European vehicle will not reach its destination in good shape.
So let us forget about Nice now, and think about post-Nice -and you will forgive me if I pin my hopes on the plan for a grand convention advanced by Belgium for its Presidency, because the evidence is there, we must do something new, we must change the method, we must accelerate history: 2004 is too late, it is too far off, it is too dangerous. Yes, a grand convention including the European institutions, the governments, the parliaments of the Member States and the candidate countries which absolutely must be associated with this common house. That is my hope.

Hänsch
Mr President, the results of Nice are disappointing, unsatisfactory and petty. The Union's ability to act on decisive matters has not been improved. The outcome of the compromises brokered in Nice is not more transparency, it is more cover-up. The democratic credibility of European policy has not been enhanced; on the contrary, the door has been opened to the insidious intergovernmentalisation of European policy and, by extension, to even greater bureaucratisation. We shall, of course, have the post-Nice process - that, at least, is a faint light at the end of the tunnel and we must not underestimate it.
Enlargement has given you, has given us all the same task as Monnet and Schuman had fifty years ago: the task of developing a method, structure and vision for the future of Europe. At that time, this applied to half of Europe; now we must develop it for all of Europe. Enlargement would be a chance to do so, a chance, Mr President-in-Office, which you missed in Nice. That is my main criticism of you. It may well be that Nice prepares the EU for enlargement numerically. But the historic failing of Nice is that your resolutions are not based on any identifiable vision for a Union of 27 Member States. It is this spirit, the spirit of Monnet, Schuman and others, which was missing in Nice and which was sorely needed. Instead, the spirit of Nice clearly amounted to wondering how to block, how to intergovernmentalise, how to be feted at home as the defender of national interests, rather than how to take the European Union forward. If Monnet, Schuman, Adenauer, de Gasperi et al had acted thus, we would never have had European Communities and, as a result, we would still not have European Union. President Chirac referred to Heads of Government who point out that public opinion still does not understand or accept more or a different sort of progress. That may well be. But that is because, that is mainly because none of the heads of government has the courage to lead and educate public opinion pro-actively, rather than running along behind it. What is heart-breaking about Europe is that so few of its many leaders are prepared to risk their political career by standing or falling by the unification of Europe.

Costa, Paolo
Mr President, I am one of those who had for some time been placing their hopes in the miracle of Nice: an Intergovernmental Conference, a Summit, a Treaty which would both reorganise the European institutions and further the process of enlargement. But the miracle did not happen! The clearest gauges of its limited success are the announcement of another Intergovernmental Conference in 2004 and the quality and import of the subjects at the centre of the post-Nice debate, which range from the distribution of competences within the Union to the value of the Charter of Fundamental Rights.
The miracle failed to materialise in the substance of the decisions on institutional reform. This failure was due essentially to the defensive tactics of the governments and their powers of veto, not to mention the limited involvement of the European Parliament. This is a sign of short-sightedness in that, today, Parliament is the only Union body which legitimises the will of the people. The miracle did not come to pass in terms of the organisation of the shared legacy of the Charter of Fundamental Rights either. Parliament and the Commission have declared that they would abide by it. What is preventing the Council from deciding to do the same?
There is just one small satisfaction: enlargement. Thanks to Nice, the institutional barrier can no longer be invoked. The winners at Nice, the only winners, were the candidate countries, whose path towards the gates of the European Union is being cleared. Only those who have always believed in the strategic value of enlargement have a genuine right to rejoice with them.

Voggenhuber
Mr President, the main aspects of European integration remained unresolved in Nice and will remain so for many years. However, the national governments' claim to be the constitutional legislator of Europe has finally been laid to rest, as has the hope that the heads of state and government think of themselves as the trustees of the idea of European unification. No, what they have done is to turn Europe into a bazaar at which nationalistic, national interests are bartered. Amsterdam and Nice have given us a Europe of imperial rulers, a Europe of national administrations, not a Europe of political unification.
What were they supposed to be doing? According to Article 1 of the Treaty on European Union, they were supposed to be creating an ever closer political union. But no, the heads of state and government blocked the idea of European unification. Back home from Nice, they are priding themselves not on what they have given Europe, but on what they have withheld from Europe. They are holding the flags of national veto, hindrance and delay high. This is not the Europe which we have been talking about for decades. It is a Europe of administrations. Now it is the turn of the parliaments, now the time has come to show that the purpose of parliaments is to tame the power of governments and ...
(The President cut the speaker off)

Van Velzen
Mr President, it was the task of the Nice Summit to develop a Union capable of absorbing twelve new Member States. A European Union which can function efficiently, transparently and democratically. After all, the countries from Central and Eastern Europe want a robust Union, a Union capable of taking decisions.
It is to be welcomed that the timetable adopted in Nice, with regard to the accession of the first countries from Central and Eastern Europe, is in line with Parliament' s timetable. But what is striking is that the Council spent four days in seclusion in Nice giving more attention to its own concerns. There was no answer to the question as to how the institutions of the European Union could function more effectively in an enlarged Union. The Council really looked after number one; to be sure, it improved things for the Commission to a certain extent and put a little sweetener Parliament' s way, as befits a father. But it all compares most unfavourably with the attention the Council gave itself.
Four main problems loom large. Firstly, institutional imbalance: a great deal for the Council and not much for the Commission and Parliament. Secondly, national interests have triumphed. Only the Belgian Head of Government, Mr Verhofstadt, was a notable exception. Thirdly, a democratic deficit. Old deficits have not been made good and now new ones have come along. Fourthly, and finally, the decision-making mechanisms cannot be explained back home. It all gets very complicated. When Mr Prodi says there are no more leftovers from Nice, I would make so bold as to doubt his word. We must introduce qualified majority decision-making for the essential topics, or else the situation will become untenable. Nice will go down in history as the Summit of lost opportunity, the Summit of lack of leadership in Europe, the Summit of opposition and the Summit in whose wake the people felt even more isolated from the European Union.

Tsatsos
Mr President, the purpose of the Intergovernmental Conference was to prepare the European Union so that it would be able to operate after enlargement. I think the European Parliament is right to base its evaluation on two criteria, namely efficiency and democratisation. As the European Parliament's representatives, Mr Brok and I fought for both, but without the required results.
We do, of course, admit that some progress was made on both counts. As far as efficiency is concerned, qualified majority voting was introduced in several instances, Parliament was granted the right to litigate in matters of a constitutional nature and the system of reinforced cooperation was made more practicable. Similarly, a number of positive moves were made as regards the European Commission. As far as democratisation is concerned, the points worth noting are that codecision has been extended on several counts and the European legislator has been authorised to define the status of European political parties and crucial preventive measures to defend democracy and freedom in the Member States.
Unfortunately, however, for the European Parliament, the shortcomings in the Treaty have been exacerbated. Unanimity has been abolished for a whole series of legislative issues, but without giving Parliament codecision powers. The Charter of Fundamental Rights has not received so much as a mention in the Treaty. The European Parliament has too little say in the reinforced cooperation procedure. Fundamental areas still require unanimity. The decision-making system in the Council may well incorporate the principle of a double majority, but it has become somewhat complicated and has upset the balance between large and small Member States.
Finally, the European Parliament will face a huge dilemma when it comes to make its final appraisal of the Treaty at the beginning of next year due to the clause on post-Nice developments. This clause adopts the European Parliament's opinion that further development of the European Union will be impossible using the intergovernmental method applied in the past. This method has had it. The clause on post-Nice developments, for all its exaggerated and wholly inaccurate eulogy of the Treaty, does give some light at the end of the tunnel, to quote my friend Mr Hänsch. Given the procedure described, new proposals for the Europe of tomorrow need to be drafted by political and social bodies - mainly the national parliaments and the European Parliament. Without this clause on post-Nice developments, the European Parliament would, I think, have been unable to accept the Treaty. With this clause, it is simply a poor treaty. However, careful thought and consideration are needed before the European Parliament decides to reject it.

Moscovici
Mr President, first I would like to join in with the praises you have heaped upon Mr Brok and Mr Tsatsos. I think all of us, from our own positions, worked as well as possible with Commissioner Barnier to contribute to this Treaty of Nice.
It is true - I shall paraphrase Mr Bayrou - that I have been sitting here since this morning; first next to the President of the Republic, then by myself, and the criticism has struck me as moderate and friendly, but criticism all the same. Failure, disarray, skimped treaty, I do not want to summarise everything that has been said. Anyway, I notice that they reflect a contradiction we all live with. Europe is our common heritage, but all of us here belong to different nations and different parties, and the criticism of the Treaty of Nice - criticism of the European Union in general - is unfortunately, or perhaps fortunately, utterly contradictory.
Some people want more of this, some people want more of that: some people want more Europe, some people want more social Europe, some people want more liberal Europe, some people want less Europe full stop, and we have had some very fine samples of all that this morning. Some people want more federalism, some people want less and that is where we have to understand that no one can be completely satisfied. I think that deep down it is in the nature of a European compromise not to be satisfying.
I am not saying the Treaty of Nice is exactly what we wanted but, to summarise what I think, it is the best possible treaty given the state of our institutions, the state of our vision of Europe and indeed the state of our ideas, and the state of Europe itself. Like the President of the Republic this morning, I too try to imagine what would happen if we had arrived here without a Treaty of Nice. The consequences of that for Europe would have been totally incalculable. I think it would have complicated enlargement and I do see satisfaction amongst the candidate countries. I think confidence in Europe would have been shaken in economic terms, and operationally we would have lost several years of ground. The French Presidency takes some satisfaction in having carried out its task, which consisted quite simply of achieving closure three and a half years after Amsterdam and five years after we began to think about institutional reform.
I would just like to take up some of the criticisms, or lessons, I have heard here and there. First on the reweighting grid which has shocked François Bayrou, for instance, and bothered Pervenche Berès. We should not forget that this is actually the first time since 1957 that the grid has been genuinely reformed and revised. We failed in Amsterdam, despite excellent work by the Dutch Presidency. Here we succeeded, although it is an extremely sensitive and complex issue. No, we were not playing roulette. I do not think the President of the Republic has a croupier' s temperament. We could not make everyone happy, so we tried not to make everyone unhappy. It was a bit like squaring the circle.
We had a system which was actually simple, but from our point of view - which was not necessarily the Commission' s, and it will perhaps set that out for you - it produced excessive distortions, that is, the principle of the double majority. We have tried to work on a principle of simple reweighting in this squaring of the circle, and I think that on the whole the result is balanced. I would say to Mrs Sjöstedt that I sincerely believe the agreement has not been made on the backs of the 'small countries' . There is real redistribution in their favour, plus guarantees. For example, in the early days of the European Union, as you know, two so-called 'big' countries could achieve a blocking minority, and today it takes three. In a Europe with 27 countries, at least one additional Member State will be needed, so no longer three, but four countries will have to join forces for a blocking minority.
Anyway, before Nice we had the opposite situation where the 'big countries' were under-represented and redistribution was needed for them. In addition during the debate we added two so-called 'safety nets' . A safety net of Member States: any qualified majority must include a majority of the Member States. There was a strong demand for that from those calling themselves 'small countries' . Then, the 21 least populated countries, representing 30% of the population, will have 50.7% of the votes in the Council. There is also a demographic safety net. I honestly believe we have a balanced system - though I will not claim that it is simple and straightforward.
Lots of speakers have mentioned the post-Nice process. Apparently that is an essential subject for Members of the European Parliament, which is not surprising. We often talked about it here, in October and November. The Presidency has never denied the importance of reflection - as you know - but do recognise that we had to concentrate on the difficult issues, and before we could have post-Nice, we had to have Nice. But I do not think we have ever smothered post-Nice, we have been keen to think about it. Other methods will be needed. Several people have mentioned it here and besides, you will have noticed that the conclusions on the post-Nice process include wide consultation of all sorts of players in society, including Parliament, and concluding with what we hope will be a short IGC.
But, at the same time - and I say this amicably to Elmar Brok - I do not think the Council can meet under the control of the European Parliament. Yes, it can be involved, but I am not sure that more control or presence would facilitate matters. We operate under constitutional systems and the powers must not get confused. It is difficult. I belong to a country that invented separation of powers and I think what we sometimes suffer from is insufficient separation of them. But it is a good system which has stood the test of time.
We need to think in depth about the future - and again I note the same contradictions in passing: those who want a post-Nice review are not necessarily in agreement about its objective. Take, for example, the debate on the constitution, where some want a federal constitution and others want a constitution based on subsidiarity. Before agreement is reached, the European Union must continue to operate. It is a thankless task. It is a painful, difficult task, but it needs to be done. This reform has been in construction for five years. The French Presidency has carried it out without self-satisfaction, but with satisfaction in the work done. Later we will see, together, all together, how to proceed. The milestones are in place, enlargement is possible, the European Parliament will have its place in the debate and in going deeper into the routes and ideas.
I also want to say to Giorgio Napolitano - who has done a lot of work on this issue - that in the end the atmosphere at Nice, the spirit of the Heads of State and Government, and the spirit of the Commission was not defensive of national interests, but seeking a common direction within those national interests. One can understand that Heads of State and Government are preoccupied with the sensitivities of their own public opinions and Parliaments. But I say this sincerely to the European Parliament - we cannot build Europe on the backs of the citizens or behind their backs.
This will be one of my last speeches to you and I would like, in conclusion, to say first what a pleasure it has been to speak here on so many occasions, with the Commission - the President of the Commission - but also to reflect on the role of the European Parliament itself. This will be the only time and I hope you will not mind. When you criticise the Nice European Council and the future Treaty of Nice - the criticism, though varied, is unanimous - be aware that you are also addressing all your governments and all the peoples of Europe they legitimately represent, who have also elected you. I think you should be aware of that because the three institutions, the Commission, the European Parliament and the Council, all represent them, each in their own way: let none consider themselves the sole guardian of the higher European interest, while the others are just traders and shopkeepers. I believe deeply in the Community method, and when we say Community method we mean balance between three institutions which need to coexist and get on well together.
That is what I will take away from this debate, this Presidency and this Intergovernmental Conference. The work has been difficult. I am sure it will be useful for the future of Europe. This is ongoing work, but it cannot continue unless we all work together to uphold the European ideal.

President
 Thank you very much, Minister. I am sure Parliament will go on to consider the relationship between the institutions.

Jonckheer
Mr President, Mr Prodi, Mr Barnier, I would like to speak on two points.
My first point is that, contrary to what Mr Chirac and Mr Prodi have claimed, there are Nice leftovers, not just for the Fifteen but also, even more so, for the Twenty-seven. In effect, the question is: are we ready for enlargement and what are our objectives? And not only is the issue of the Commission a leftover, but the lack of extension of qualified majority voting and codecision strengthens competition between the Member States, between the Fifteen and a fortiori between the Twenty-seven, and undermines the future of the European social model.
As regards post-Nice, the following question has to be dealt with: do we want to continue at the same pace as Fifteen, and a fortiori as Twenty-seven? I do not think that will be possible. We must lift the consensus rule, including in a future convention. The European public interest, of which none of us is sole guardian - Mr Moscovici is right about that - cannot be based on the addition of national interests which are growing and becoming neutralised and in that regard Prime Minister Verhofstadt had a salutary message for us all.

Méndez de Vigo
Mr President, there is an expression in my language 'to take French leave,' which is what the President-in-Office has done, leaving without saying goodbye. Therefore, my first words should be to thank Mr Prodi, who has stayed. The Commission is showing that it is interested in the debate in this Parliament.
As far as the Treaty of Nice is concerned, we can say very little, because we do not yet have the conclusions of the European Council, and therefore, until we see them, we cannot add much.
I think there are two matters in which the European Parliament plays an important role. The first is the Charter of Fundamental Rights. The Charter has been proclaimed and that is a good thing. But it has neither been incorporated into the Treaties, nor has a reference to the Charter been put in Paragraph 2 of Article 6 of the Treaty on European Union. And, above all, I have the feeling that the proclamation was not a solemn one. It was a proclamation on the quiet. I would therefore like to thank our President, Mrs Fontaine, and President Prodi for what they have said: for the European Parliament and the Commission, the Charter is law from now onwards, and it is going to have an effect from now onwards. I think that this is positive.
The other point from Nice on which Parliament will judge Nice is the extension of qualified majority voting and Parliament' s codecision. On this subject - from what I have been able to hear here this morning - the news is vague and does not seem to be very promising. We will have to wait before we can establish what Parliament' s opinion is.
I remember that when Dimitris Tsatsos and I drew up the report on the Treaty of Amsterdam, we talked about Ortega y Gasset, who said, quoting old Cervantes, that often you have to choose between staying at an inn or continuing with the journey. Nice is the road to two important things, one of which is enlargement. Enlargement is going to take place - now we know it. This is also the case for the euro. I think that a collapse at Nice would have been a punch below the belt for the euro.
Therefore, perhaps in this Parliament we are in a paradoxical situation that is completely different to Amsterdam. Perhaps, for this Parliament the European Council of Nice has not been positive, as it was in Amsterdam. But perhaps, for the European Union, the European Council of Nice is opening up the way for hope and for the future.
We will see, Mr President, when we read the conclusions. Until then, the Group of the European People' s Party (Christian Democrats) and European Democrats reserves judgement on what its position will be.

Corbett
Mr President, after the Single European Act, after Maastricht, after the Treaty of Amsterdam, this Parliament had to judge the results. In all those cases we reached the conclusion that those treaties were not entirely satisfactory, did not respond to all of our aspirations, but nonetheless represented a step forward and were at least better than the status quo. We recommended that they be ratified.
This time we have a treaty which, at least on one point, represents a step backwards and is arguably worse than the status quo: that is, the new system for qualified majority voting in the Council, which makes reaching a decision even more difficult than it is at present. It introduces a triple threshold: number of states, population, and the percentage of the votes set at a higher level than is the case at the moment. At the moment it is 71% of the votes. That is already very high. It was set high to make sure that under any permutation such a qualified majority represented a majority of the population. Now that we have a population criterion in there anyway, it should have been possible to lower the threshold in terms of the number of votes. Instead it seems that it has been raised, although I speak while waiting to see the final text: apparently there was an adjustment in the last hour of the IGC on that. I will evaluate that outcome when I see the text. Nonetheless that is a very worrying situation.
For the rest the Treaty is a mixture of unsatisfactory and positive things - unsatisfactory but nonetheless better than the status quo, I suppose, at least as regards the extension of qualified majority voting, the extension of the codecision procedure for the European Parliament, and the provisions for enhanced cooperation. That is all better than we have now, even if not all of our requests and desires have been met.
Finally, there are a few positive things: the new version of Article 7 of the Treaty; the article on political parties and their statute; the right of this Parliament to take the other institutions to the Court of Justice - that is also an important factor of political control; the new formula for the European Commission, putting the so-called "lex Prodi" into the Treaty, strengthening the President and the new composition of the Commission - a reasonable compromise which I accept and will work over time; and, as my colleague, Mr Tsatsos pointed out, the way forward to the future. This is not the end of the story. New reforms will come and we must take advantage of that.
To sum up, we have a mixture of the good, the bad and the ugly. We will now evaluate this in detail. I believe we will recommend ratification and moving forward to a new reform, but we must look at the small print to decide whether that is the right way forward.

McMillan-Scott
Mr President, I apologise because my remarks are slightly ill-prepared. I have come straight from a meeting and, because there are no televisions in the meeting rooms in this building, it is very difficult to keep in touch with what is happening in the Chamber, a deficiency which I hope will be corrected in due course.
Many of us regard the Treaty of Nice as unacceptable but for many different reasons. The great difficulty concerning the Treaty of Nice - as many people have already commented - is that the lack of any text at this time makes it impossible to make a considered judgment. We do not know whether the carpentry shop in Nice has produced a Pandora's box for Commission activism or a coffin for democracy, but - whatever has emerged - it is being French-polished and we hope the final result helps the European Union.
I believe that two failures are the lack of democracy, because the opportunity to open the Council up to public scrutiny has been ignored although many of us feel that this was the time to do it, and the illogicality of the re-weighting of votes, with one approach for the Council and another for the European Parliament. Many people looking at the Treaty of Nice will wonder why it was done in that way. I personally believe that the re-weighting of votes must take account of population, as is done in the European Parliament and should have been done in the Council also.
A further reason for opposing the Treaty of Nice is the development of greater bureaucracy in the European Union. Who can genuinely argue that the thirty areas now under QMV are essential to the enlargement process? I think most of the enlargement countries - while accepting the Treaty as it stands because it exists and opens the door to their accession in due course, sooner rather than later I hope - will look at those points and, like most of us, realise that they have no relevance to the day-to-day affairs of their lives. No reform of the common agricultural policy, no reform of the development policies which are vastly wasteful. Then there is the incorporation as a mandatory mechanism of the Charter of Fundamental Rights: in itself as in the United States today, a recipe for confusion between the courts in the European Union. There is the fact that under enhanced cooperation the European Parliament has no role, although certain leaders of national parties - including the leader of the Labour Party in his Warsaw speech - promised no reform of the structural funds in real terms until 2013. This is not a recipe for enlargement, it is a recipe for more bureaucracy, less democracy.

Seguro
Mr President, we have already made a thorough assessment of what happened in Nice, but we should remember that Nice began with a very restricted agenda. The Council asked this Parliament not to broaden the agenda because the intention was to concentrate exclusively on the Amsterdam leftovers. The Council said it wanted to do this in order to make the European Union's institutions operationally efficient so that it could work better with 27 Member States than it does today with 15. What was the result of this exercise and this work? The result was, in fact, that the most fundamental and important factor for introducing operational efficiency, decisiveness, flexibility and workability into institution operations was not dealt with at all. What the Council concentrated on most were questions of power; in other words in Nice there were too many calculators and not enough policies. The images coming out of Nice showed a Europe in which every country was trying to look after itself, suggesting that the Europe of the future will be a battle between the large and small countries. I wonder whether these might not be arguments that better serve the interests of the Euro-sceptics and Europe' s enemies. I wonder whether this image we have been given of Nice might not be an appeal to the conscience of convinced Europeans, those who do not just want a single market, those who do not just want a single currency, in the face of what I regard as this "non-time" for Europe.
In my view, Nice was the second part of Amsterdam and we are now in a phase, an interval, between Amsterdam and an IGC to be held in 2004 but with an unknown end-date. Right now it is the duty of convinced pro-Europeans to counter the image that came out of Nice and say that solidarity for us has a meaning and that it is possible to build a Europe in which large and small countries can coexist peacefully; in other words, there are no expendable countries in this European project and national egos are nonsense in this Europe. So I should now like to appeal to the House and the Commission: somebody has to put the case for this European project. The case for the European project is that it is not the sum of national interests but a joint project, as President Romano Prodi has said, and the institutions must now look to the future and join hands so that enlargement can take place, so that the citizens can look on Europe as we would like them to and so that politics can go back to building the European project rather than just upholding power, particularly the power of the larger countries.

Salafranca Sánchez-Neyra
Mr President, it has been said, and I think rightly so, that Europe is born out of necessity and that only when necessity knocks at the door does Europe decide to take a step forward. And necessity gave an urgent knock at the door of Europe in Nice, in the form of sclerosis as a result of the prospect of an enlarged Europe.
There can be many evaluations of what happened in Nice, and we have had ample proof of that this morning and this afternoon in the continuation of the debate. But the European Council in Nice, like many other summits in the history of the European Union, represents a triumph for reality, a triumph of pragmatism over utopianism. Although we would all have liked to increase our powers in codecision - and despite the disputes between large countries, between large and small countries and between small and medium-sized countries - it is obvious that the following, although not spectacular, are all steps in the right direction, as President Prodi said this morning: a Commission whose president has his powers increased; a decision-making process in which more decisions - not all those that we would have wished - are taken by qualified majority; a clarification of the role of enhanced cooperation; and also - why not come out with it? - a reweighting, imperfect though it may be, of the votes in the Council of Ministers.
But Nice, Mr President, is not the end of the road, but the starting point for a new phase with many challenges. We have to successfully complete accession, consolidate the internal market, deliver the single currency, develop a real common foreign and security policy and open up a new debate on the future of Europe. These are challenges that cannot be overcome, Mr President of the Commission, with our backs to the people. And in order to do this we will need more generosity, more realism, a greater involvement of the institutions that defend the Community interests, and in this type of conference, everyone will need to seek, as Jean Monnet said, and I will finish with this, their interest in the common interest.

Swoboda
Mr President, Mr President of the Commission, Commissioner, ladies and gentlemen, there are winners and losers, but Europe cannot claim to be one of the winners and democracy and transparency certainly cannot. That is, in fact, the gist of what President Prodi said today in a commendably clear and unequivocal manner.
Let us take one thing at a time: the charter was not included in the Treaty, not so much as a mention. Progress was made on security and defence policy, it is true, but it has no parliamentary dimension. As far as qualified majority voting is concerned, it has only been extended slightly and the procedure is now even more complicated and less transparent than before. We do, of course, have reinforced cooperation, but how it will work remains to be seen. The ratio between large and small was, in the end, regulated in a perfectly reasonable manner, following a number of totally obtuse and unacceptable suggestions, and the Commission has been strengthened, even if the link with the number of members is not necessarily an overly reasonable or clever decision.
Mr Moscovici is without doubt quite right to say that talking about it among ourselves is not enough; we must tell the people about it. It is true that the people are probably more critical of integration more often than we here in the Chamber. And with a better result, we would probably have had more trouble persuading the people, but then again we would have had more persuasive powers had we been able to bring a better result home from Nice. We would have been able to convey a better, stronger European result to the people with a better and clearer conscience.
I should therefore like to come back to something which has been touched on a few times today already. Yes, we need to analyse the result. But I think that we should not do so until we have a clear and unequivocal promise from the Council as to how the process will operate from now on, i.e. with the close involvement of the European Parliament. What was found and said in Nice is too vague for me: yes to Parliament's involvement. What involvement? I think it is a disgrace if we have to fight yet again for perhaps two representatives to attend as many meetings as possible. It is totally unacceptable. This Parliament must play a leading role in this process, just as it did at the convention. We want to prove to the heads of government that we know best. If we compare the convention with what happened at the Intergovernmental Conference, admittedly with less serious problems than at the Intergovernmental Conference and with fewer national interests than at the Intergovernmental Conference, then the convention and the modus operandi and methods of the convention clearly come out on top. I therefore take the view that we should only apply ourselves in detail to what has come out of Nice once it is clear that the European Parliament will have an important and decisive role in the future process. We want to prove to the heads of government that we know best.

Sudre
Mr President, Mr President of the Commission, Commissioner, ladies and gentlemen, all my colleagues have stressed the expectations that surrounded the Nice Summit, which was intended to allow the European Union to continue operating effectively, democratically and transparently after the historic enlargement we are awaiting. Certainly, the Nice Summit has made it possible to achieve significant progress on all the issues that directly affect the lives of our citizens, whether it be the preservation of health, the protection of the environment, social policy or indeed the adoption of a European Company Statute. Another positive point is that the Charter of Fundamental Rights has been officially proclaimed, even if it is not intended to be binding at this stage. Finally, the decisions taken in the area of the common foreign and security policy represent undeniable progress.
This summit would have been a triumph if the crucial revision of the Treaties had been crowned with as much success as the areas I have just mentioned. In fact, while we seem to have succeeded in avoiding total paralysis of the future enlarged European Union, it has not been possible to convert the ambitions of the French Presidency into a new draft of the Treaty. Be it the excessively limited number of areas transferred from unanimity to majority voting, or subject to codecision, be it the upward revision of the number of Members of the European Parliament in the Europe of tomorrow, or yet again, be it the uncertainty over the number of Commissioners after the enlargements, the Treaty does not come up to scratch, far from it.
Beyond the technical aspects of that reform, what concerns us most of all is the growing difficulty the Member States of the European Union have in making joint decisions, in accordance with the common interests of their citizens. Let me conclude, as rapporteur for the outermost regions of the Union, by expressing deep regret at the rather disappointing conclusions of the Nice Summit, which do no more than acknowledge the Commission' s work programme. The outermost regions deserve better and Parliament will continue to work flat out - with Commissioner Barnier' s help, I am sure - to give them all the space they are entitled to within the Union.

Maij-Weggen
Mr President, Nice was no success. Notwithstanding all the self-congratulation by the French government this morning, the IGC simply did not finish on a good note. Admittedly, reinforced cooperation and the European defence force got off the ground, the English having imposed quite a few restrictions on the latter. The most essential issue, i.e. the switch from vetos to majority decisions, was not applied to the very areas where it was most needed. Taxation, social security, justice, asylum issues, agriculture, structural funds; the very areas that ought to have been provided for before enlargement, were left out. The Summit simply failed on that score. National interests took precedence over the interests of Europe as a whole. And what makes it more serious still is that in a number of cases where majority decision making was introduced, no provision was made for Parliament to have authority as colegislator. So the democratic deficit has grown a little larger. What possessed the Summit to have so little feeling for democracy?
Then there is the position taken up by the Netherlands. During the Summit it seemed as if the Netherlands was only out to win a kind of football match against Belgium. The result of this outpouring of energy was 12-13 instead of 10-10 in terms of points in the vote weighting. What is that against 300 votes? Anyway, why was France so dead against counting in population density? Surely it is a very common democratic principle? So the Netherlands got one more vote than Belgium in the Council. But if we look at the number of seats in the European Parliament then the Netherlands drops from 31 to 25 and Belgium from 24 to 22. So the Netherlands paid a price for gaining a toehold in the Council.
At the end of the day, it is clear that the traditional IGC format no longer works. When the time comes to make preparations once again for a summit in 2004, it would be better to use the convention format. Leave it to the 15 governmental representatives, 30 national and 15 MEPs to prepare for the IGC. It worked well for the Charter and it will also work better than a traditional IGC. And it is more democratic to boot.
Mr President, as far as I am concerned, the Nice Summit simply failed to make the grade.

Suominen
Mr President, according to a press report, the initial comment by the Finnish Prime Minister, Paavo Lipponen, after Nice was: "This agreement must be remade" . We must surely agree with him, although we know that this desire will only be able to be realised after many years have passed, if, as I believe will happen, national parliaments ratify the Treaty of Nice. Hopefully, however, Nice showed Finland and other small countries that emphasising the intergovernmental European nature of the Council' s role will mean a continuous cycle of defeats for small countries in decision making. No one at the meeting spoke for Europe. When the Commission then tried to do so, its President, as we saw, was literally thrown out of the door. I would like to say many thanks anyway for the gesture
It is nonetheless sad for the future of Europe that no European statesmen were in evidence. Almost every country brought its own internal political problems to the meeting. When they got back home, the prime ministers then emphatically pointed out how they had achieved victory with regard to these internal problems. "We were able to keep matters under our own control" or "We were able to block European decisions" , they said in their own countries. The candidate countries were thus presented with a very bad example, which must have astonished the whole region, from Tallinn to Prague and Budapest. It is obviously a positive matter that enlargement can now go ahead. That message must be clearly sent to the candidate countries. After enlargement, meetings like Nice and the IGCs as they are at present will be impossible; integration will either really make headway or simply fall apart. Things cannot stay as they are now.
It is to be hoped that Europe will yield statesmen. The difference between politicians and statesmen is that politicians know well enough what people want today, while statesmen know what they will actually want twenty years from now.

Ferber
Mr President, Mr President of the Commission, ladies and gentlemen, I am not one of those clever members who can already weigh up everything decided in Nice in detail, because I have yet to see the texts. But if we have learned and must learn anything from Nice, then it is that Europe is far too valuable to leave it solely in the hands of the Heads of State and Government. The model of the Intergovernmental Conference has had its day. That is the first and most important lesson to be learned from last week's negotiations.
On the positive side, we have managed to break through the power boundaries. This is an old demand which we Bavarians have made time and again and for which we were ridiculed years ago; now it is the basis for Council resolutions. I see this as a huge success. But when I look at the wrangling which took place in Nice, it would perhaps have been more important to start discussing power boundaries straight away. That might have made it easier to find reasonable compromises here. In theory, the Amsterdam leftovers have been dealt with. In practice, however, compromises have been found on the basis of the lowest common denominator. Europe cannot be operated in the long term by working solely to the lowest common denominator.
I only hope that Parliament will learn the right lessons from all this. This Parliament must become more self-confident, especially when dealing with the Council of Ministers, if we want to prevent bureaucracy and secret diplomacy from taking over Europe permanently.

Beazley
Mr President, it is not easy to criticise the French presidency during this debate as it is not present. I understand that President Chirac, Mr Vedrine and Mr Moscovici have other important meetings to attend. However, I am sure that the President of the European Commission, Mr Prodi, has important meetings to attend as has Commissioner Barnier and yet they have done us the courtesy to wait for the end of this debate.
Mr Moscovici says we should not blame him, we should blame other governments at the Council. It is deplorable that he has not found it possible to find a deputy to wait for the end of our deliberations. We are after all hoping that we shall be joined by applicant countries from Central and Eastern Europe who have been used to the arrogance of government and people not being present, to people giving speeches and then disappearing. I deplore the fact that Mr Moscovici has found no deputy.
Has Nice been a success? Mr Moscovici says that we must turn to our own national governments and criticise them. I am happy to do that. Mr Blair returned to Great Britain as a conquering hero because he had not surrendered this, had not surrendered that and had fought for Britain's interests. Well, of course, I support him in that but what has he actually achieved? He tells us that he has ensured that enlargement will take place. I do not know whether the Commission will reply at the end of this debate but I wonder, in the absence of the Council, whether the Commission is equally confident that by 2004 this European Parliament will contain Czech, Hungarian and Polish Members of the European Parliament and Members from the Baltic States.
Mr Moscovici says that of course you must temper your idealism with realism. I just ask him: Did General de Gaulle temper his idealism with realism, or Winston Churchill? "Public opinion will not wear this." "We cannot get this through the House of Commons." "Oh, there is a referendum." Is there? Have we no leadership in the European Union? Where is the Council? Where are the governments?
It is deplorable and the only hopeful sign is that the European Commission has clearly recovered its sense of self-confidence. This European Parliament will join with the European Commission in insisting that our demands are met.

Bodrato
Mr President, the Nice Summit has shown that Intergovernmental Conferences have reached the end of their useful life. We are on the eve of eastward enlargement, a turning point which is throwing the strategy of doing things step by step into crisis. If a response is not found to the democratic deficit of the European institutions, the Union will not be able to count on the support of the peoples.
The list of problems tackled in Nice is long but, as President Prodi made quite clear, there was insufficient focus on the institutional reforms and the role of Parliament. It may be that we went to Nice with too many ambitions. Parliament's ambition does not, however, mean that it lacks a sense of responsibility. If we gave in to the realists, we would sweep the Charter of Fundamental Rights under the carpet and be content with a free trade area governed by the large corporations and national interests. Something is wrong. The young federalists who called upon the heads of government to be more courageous, to have the courage of the fathers of the European Community, have understood this. We need to set in motion a large-scale debate on the future of Europe: this must be the post-Nice process if we want to revitalise Europeanism in a profoundly different environment.

Prodi
Mr President, I will be very brief because the purpose of my speech is to thank you, to thank you not only for your kindness to us but also for what you have said. It is not courtesy which has prompted us to stay until the end of the debate, Mr Beazley: Commissioner Barnier and myself have stayed to hear your opinions, your convictions and your feelings, for it is my opinion that, if we are to build Europe, Parliament and the Commission must do so together.
We have been quite frank with each other in today's debate about those parts of the Treaty of Nice which give us cause for satisfaction and even more open about those with which we are not content. Our reasons are different in some cases but we share the same feelings and concerns.
We have made no bones about the need to continue with the same force and the same determination as before Nice, to achieve our objectives along the road to enlargement, which will be our greatest historical moment and which it is the responsibility of Parliament and the Commission to bring about in the coming years.
We have also been completely clear, ladies and gentlemen, about the need for Parliament and the Commission to work together to build the new Europe, for this arduous task is our responsibility, but ours is also this great mission and this great potential.

President
Thank you very much, Mr President of the Commission.
I have received six motions for resolutions from the Members, tabled in accordance with Paragraph 2 of Rule 37 of the Rules of Procedure.
The debate is closed.
The vote will take place on Thursday at 10.00 a.m.

2001 budget (continuation)
President
In accordance with the agenda, we will resume the debate on the 2001 budget.
Mr Wurtz has the floor.

Wurtz
Mr President, at first reading, my group performed the symbolic political act of tabling a resolution rejecting the budget. We wanted to draw attention to the characteristics, unacceptable in our view, of the draft submitted to us at that time. We stood by the principle that there should be new appropriations for new policies. Instead of the intended redeployments, detrimental to the traditional priorities, we called for the multi-annual revision of the financial perspective, especially for external actions, although a similar problem arises for expenditure on employment and environmental protection. We decided - and we make no bones about it - that we did not want the Council putting us in a position tomorrow where we have to choose between two priorities that are equally legitimate in our eyes: the Balkans and the Mediterranean.
We are now in precisely the situation we wanted to avoid. Under the terms of the compromise concluded between Parliament' s delegation and the Council, Euro-Mediterranean cooperation suffers a cut of EUR 200 million compared with the budget for 2000. A fine signal to send our close partners in the South. As for the Balkans, they have given rise to an arduous and very precarious financial set-up. This includes a transfer, to the 2001 budget, of 2000 budget appropriations for aid to Latin America, or appropriations for Morocco under the draft fisheries agreement and not used this year. In addition, and above all, the problem of financing for the Balkans will still be there in its entirety for the years ahead. Heading 3, internal actions, also warrants a comment, since the 'employment initiative' , re-baptised the 'Spirit of Enterprise programme' has been amputated to the tune of EUR 87 million, the Trans-European Networks by EUR 23 million, and environmental protection by EUR 42 million.
In total, with about 1.09% of European gross domestic product, or even less, the 2001 budget will be one of the lowest of the last ten years, in relative terms, since it is well below the already very restrictive ceiling established under Agenda 2000 in Berlin in March 1999. That is why the Confederal Group of the European United Left/Nordic Green Left unfortunately cannot support Mrs Haug' s report.

Turchi
Mr President, I would like to start by stressing the fact that this year's budget is due in particular to the work of all the Members of the committee itself, in addition, of course, to the work of the committee chairman, Mr Wynn, who has steered us with wisdom through the various situations, and tense moments which we have experienced. I would also like to thank Commissioner Schreyer. However, this does not mean that we could have done more or better. I will focus on one aspect at a time. Firstly, the positive side: the approximately EUR 60 million of agricultural funds allocated for testing, which is a significant although, in my opinion, not conclusive step; the earmarking of around EUR 450 million for small and medium-sized businesses, for we have at last realised that the European economy is not based on multinationals but on small and medium-sized enterprises, which will give new impetus to development and employment; then the fact that the increase in expenditure is only 3.5%, and the increase in appropriations for the Balkans, which is of political importance. In this sense, our committee has made a fundamental achievement.
I would now like to focus on two points which I feel require some attention and give cause for concern: firstly, the possibly excessive use of flexibility which, like all excessive things, is a negative factor, which means that we must not use it as a safety net; secondly, the fact that the creation of the new jobs is simply due to early retirements. This must not become a precedent in our institutions. Finally, I urge the committee to adopt increasingly a budgetary strategy aimed particularly at strengthening and protecting our currency, the euro.

Dell' Alba
Mr President, Commissioner, ladies and gentlemen, and I would have said Madam President of the Council, but I do not see her among us. It is true that the Chamber is pretty thin, but unfortunately the debate on the budget lasted longer than planned and we - I and the speakers who follow me - will not have the opportunity to raise the matter with the Presidency.
I, in my turn, would like to congratulate the rapporteurs, the chairman of the Committee on Budgets, the Council and the Presidency on the work that has been accomplished, and the conclusion of this agreement which will allow us to vote for the budget for the year 2001. But I endorse all the comments made, especially by Mr Colom i Naval, on this extremely delicate issue of the financial perspectives. An agreement has just been concluded in Nice to make enlargement possible. Now, the previous enlargements gave rise to major financial allocations. The Member States were not afraid of public opinion at home then and the enlargement to Spain and Portugal was accompanied by a major mobilisation of resources. When I see that our budget is down by comparison with the year 2000, both in real terms and in terms of percent of GNP, and that we are so very far adrift from the objectives set in Edinburgh, I recognise that as the real problem. Refusing to harness ourselves to them means undermining the credibility of the construction and enlargement of the Union.

Van Dam
Mr President, in the course of the budgetary procedure for the 2001 budget, the debates in this Parliament focussed on a limited number of issues. One of these issues was, and still is today, the increase in the financial perspective for foreign policy. The Council is right to reject this revision because there is no point in putting a ceiling on the expenditure in Berlin for a period of six years if these ceilings are going to be called into question every year. These maximum levels force the Commission to set priorities within the confines of a budget, in the way that every government has to.
Another issue to be given an airing once again this year was the flexibility instrument. An instrument of EUR 200 million that has now been earmarked, in agreement with the Council, for aid to the Balkans. As Mr Colom i Naval rightly commented, using the flexibility instrument in this way misses the whole point, i.e. the assuaging of unforeseen budgetary need. To be perfectly honest, I do wonder whether he would have said the same if this instrument had been used in the same spurious way for MEDA, as proposed by Parliament. It so happens that I voiced this criticism during the first reading of the budget, and I do not recall anybody applauding it. Needless to say, I am not against giving aid to the Balkans. The Union as an association of nation States, born of the need for peace in Europe, has a duty of honour to finance the process of peace and reconciliation in the Balkans. However, I feel that when it comes to mounting such an extensive operation, we must take stock of the need for aid before opening our wallet. The zeal shown by the Commission and Parliament to equip the Balkans with aid reserves, contrast sharply with the cuts in aid for the candidate States.
Mr President, we probably ought to reserve the flexibility instrument for the 2002 budget now for the candidate states. They might wish to join the EU earlier, completely out of the blue.

Ilgenfritz
Mr President, ladies and gentlemen, the principles of thrift and social and economic balance have been taken into account in drawing up the budget and the rapporteur must be thanked for that. It is also good that, as the main source of employment, small and medium-sized enterprises have been allocated additional funds. This will help to create new jobs and continue the fight against unemployment. We are also aware of the assumption behind the Commission's Letter of Amendment No. 2, i.e. that around 900 million can be saved in Category I. However, this assumption no longer holds true. First, the euro has now gone up in value, thereby reducing any potential savings, and secondly, we must now assume that insufficient funds have been earmarked in the budget for dealing with the BSE crisis. We shall therefore be forced to accept a supplementary budget which will again seriously reduce, if not eliminate any potential savings in this category.

Costa Neves
Mr President, Commissioner, I should like to begin by congratulating our colleague, the general rapporteur Jutta Haug, on the way in which she has done her job, which has contributed immensely to the constructive atmosphere in which our work has been carried out in committee and in Parliament in general.
The vote that is to follow this debate will mark the end of the long, complex process of approving the European Union budget for 2001. As a result of intense negotiations and successive compromises among the various institutions, the chances of its approval are reasonable. However, I should like to point out certain aspects that carry over to subsequent years. The budget represents, in payment appropriations, just 1.056% of the Community GDP. The financial perspective forecast 1.11% for 2001, which is not to mention the 1.27% that was being mentioned a few years ago. On the other hand, external cooperation programmes are still not multiannual, the difference between commitments and payments is still growing, some projects are still implemented very little or badly, there are unjustifiable and unsustainable payment delays, and Parliament has been confronted with faits accomplis with budgetary implications. Whereas there is no solution as yet for the first aspect mentioned, the GDP, and I am sure that Parliament will soon demonstrate its persistence with regard to the second, I must say that with regard to the third aspect that I have highlighted, I believe that the great novelty in the budget process in coming years is the agreement reached between Parliament and the Council for the Commission to draw up a report by 30 June 2001 to be submitted to the first two institutions regarding the progress achieved in a number of basic fields, such as the reduction in the amount outstanding, the simplification of the project round, improved programme implementation, a commitology review, the reform of the Commission, the definition and execution of implementation objectives, particularly in external cooperation, and the provision of more thorough information for Parliament in several fields. If the submission of such a report is not seen as just one more formality, the hopes that many of us have placed in this new step will be justified.

Wynn
Mr President, at times we have sounded like a mutual admiration society in the way in which we have congratulated one another on this. I may just deviate from that trend slightly in relation to the Council - not necessarily the French Presidency - but the Council in general.
Let us not kid ourselves, this is a good budget. It is not the budget that I or many of my colleagues would have wanted. However, we can be satisfied with it. In football terms it is like a l-1 draw. However, because of the flexibility instrument, we think we have won the penalty shoot-out.
The Commission's original proposal for a revision of the financial perspective to take EUR 300 million from category 1 for category 4 was a worthy idea: worthy of support and eminently sensible. Unfortunately, a majority of my colleagues did not agree with me and therefore we could not go along with it. Neither was there a qualified majority within this House to revert to Article 272. Therefore, we had to find a solution within the means that the interinstitutional agreement affords us so that we could get a decent budget. That is what we have done: we have avoided a budgetary crisis by going to Article 272; the financial perspective has been maintained, even though we have used the flexibility instrument. The result is the best that we can hope for without either a revision or Article 272.
Mr Colom i Naval made his remarks this morning because it was clear to those of us who were present when the IIA was agreed that the flexibility instrument should not be used for the same purposes in consecutive years. I admire the answer Mrs Parly gave this morning but we have turned a blind eye to that. Kosovo and Serbia are in effect the same thing. We have ignored what we agreed. We have also said that the flexibility instrument would not be an annual reserve for category 4 but that is exactly what it has become. That is why it is not only Mr Colom i Naval who is frustrated at the way things have developed over this budgetary procedure in the last two years.
It must be said, and I put it on record, that the French presidency has been a good partner in trying to find solutions.
On classification, I have no problem with the two points that were raised: pensions are compulsory expenditure. What we are talking about is an early-retirement scheme which as yet has no legal base; no one knows whether what will be proposed is compulsory or non-compulsory and it is, after all, a p.m. that is on the line.
On the fisheries agreement, we have only changed the remarks for the A lines. In other words, the remarks which concern non-compulsory expenditure. In both cases we have not changed any figures. There should not be a clash on that.
Just because we have a budget and we have agreed a deal at conciliation, let us not imagine that all our problems have disappeared. The problems will remain until we sort out what we are going to do about external expenditure.
There are times when I foolishly assumed this year that once the Commission had made its proposals for a revision we could reach an agreement with the Council. I was wrong. Then when I discovered that there would be no discussions on that revision regarding Article 25 of the IIA, I was, to say the least, somewhat disappointed. The Council's attitude in this game of football seems to be not to worry about the ball but to get on with the game. Let me just say to the Council that, as far as this game is concerned, we have not run out of balls and this side intends playing until we get the right result.
Finally, I thank all those who have been involved in this - not just the rapporteurs - but also the secretariat of the Commission, Parliament services and the political group staff.

Mulder
Mr President, firstly, I too would like to thank all those who contributed to the determination of the budget, the Commissioner, the Council and the rapporteurs. I would also particularly like to thank Mr Wynn, who, I believe is seeing out his first full year as chairman of the Committee on Budgets during a budgetary procedure, and I think he has made an outstanding job of it.
I am satisfied with this budget. I am particularly satisfied because we stayed within the financial perspective again. I believe Parliament must uphold its agreements, and they can only be broken in cases of extreme need. I have not identified any such cases this year.
The Commissioner is still proud of this and says that the agricultural expenditure will increase by an enormous percentage this year as compared with previous years. That is indeed the case but then these are agreements that must be kept. They were concluded before she became Commissioner and I think it would be to her credit if she were to uphold the Berlin agreements.
What else has a bearing on the agricultural budget? We are all familiar with the content of the letter of amendment in October and if all goes well, if the dollar stays at 91 cents, then we could end up with a surplus of approximately EUR 1.3 billion in category 1A. Suppose that does not happen and Mr Duisenberg says it is not going to happen, how are we to finance the BSE crisis? That is what I want to know. Are we going to make cuts in other agricultural expenditure, are we going to defer it to other years, is it still possible to use the surplus for 2000 or can we devise an insurance system, which already features in an earlier parliamentary resolution?

Garriga Polledo
Mr President, ladies and gentlemen, Commissioner, representative of the Council, rapporteurs, each budgetary year the European Parliament gains budgetary importance. We do not gain this importance out of nowhere, but from the Treaties, although sometimes the Council finds it hard to admit it.
Last year, with the Bourlanges report, the flexibility instrument was mobilised for the first time, and an institutional declaration was also obtained recognising the possible financial insufficiency of category 4.
This year, the Haug report has taken advantage of this institutional declaration last year to discuss the need to revise the financial perspective. It has been demonstrated that it was not the right time for a revision, that there was enough margin to fulfil the commitments to the Balkans and to the MEDA programme without altering the forecasts of Berlin 1999, and it has been shown that the compulsion to have a revision is only in the intentions of those who voted against Agenda 2000 in its day.
However, the European Parliament cannot carry on forever reducing its external commitments. This year the flexibility instrument has been used again, but we should not continue down this road.
We do not want there to be a proposal for revision for next year in the Colom Resolution, because we want to wait for the World Bank evaluation, but we share his criticism that this method of resolving the financial insufficiency in category 4 distorts the multiannual nature of the major external objectives of the Union and the very definition of the financial perspective.
This time, more than ever, the secret of success will be in correctly implementing the budget.

Naranjo Escobar
Mr President, Commissioner, I must first congratulate the general rapporteur, Mrs Haug, the President of the Commission and my colleagues who have been involved in negotiations on the excellent work that they have done.
The final outcome of the negotiations is positive, which shows that in order to achieve some objectives, what matters is not getting there alone and early, but getting there altogether and on time. We wanted a budget that would combine our efforts with those of the Member States to contribute to economic growth and increasing employment, and therefore the agreement that has been reached on the multiannual amount for the small businesses programme is a good thing. However, sustaining this and Parliament' s other political priorities needs to be compatible with budgetary stability in spending.
It is true that the Union is in its most favourable economic situation for 10 years, as is proved by the fact that the net balances have improved a great deal. But, precisely for this reason, I think that the agreement reached on payment appropriations is reasonable, because it combines efforts in the right direction for sustained growth.
Parliament' s budgetary strategy marks a before and an after at this start of the millennium. Because the negotiations not only lead to the final amounts and their distribution, but also to the implementation of instruments which are going to enable us to measure to what extent the political will of this Parliament translates into facts. And I am going a little further, because it is not enough to have strict and transparent rules for implementing the budget, such as the cancellation of commitments if they have not been implemented after two years. This should go hand in hand with a commitment from the College of Commissioners to a fair and efficient distribution of human and material resources for the management of the various policies, that is, they must remember the political priority of Parliament and the management priority of the Commission.

Stenmarck
Mr President, now that we have arrived at the final decision on the EU' s Budget for 2001, we can say that we have come through a year of constant struggle to produce the Budget successfully within the framework devised when the financial perspective was adopted in Berlin in March 1999. We can now say that this struggle has been successful. We shall be able to adopt a Budget within this framework, which is a great success. I believe, in actual fact, that both the Member States and the taxpayers are grateful that the charges are not still higher.
I also see it as a clear success that we are able to go into a new Budget year with a greater margin than in the past. When we make use of 1.06 per cent of the Member States' GDP, this gives us a margin greater than ever before and greater than that predicted in Berlin less than two years ago. This gives us an opportunity to be an active partner where enlargement to include the countries in Central and Eastern Europe is concerned and when it comes to helping establish peace and prosperity in Serbia and the former Yugoslavia.
For all this to be possible, there will have to be extensive prioritising in the future, too. This will be necessary if we are successfully to honour our long-term commitments, something which is clearly possible if our objective is to work for an EU which is strong but, at the same time, circumscribed.
As I see it, there is a major threat in the present-day situation, namely BSE. It is nonetheless important to note that we must cope successfully with this too within the current Budget framework. This means that, if the solution to the problem requires still more money, this must be provided by means of other savings in Category 1 or through the Member States' accepting a larger portion of the cost.

Sommer
Mr President, ladies and gentlemen, I intend to focus on one fundamental point in my comments on the budget lines for environmental, public health and consumer protection policy. Generally-speaking, the proportion of the budget earmarked in order to safeguard and maintain the environment is far too small. This is particularly annoying in that environmental policy is a horizontal policy because environmental policy - or at least successful environmental policy - must be applied as a cross-border policy. We all know that. Which is why safeguarding and regenerating the environment is a job which has to be done at European Community level. But this also means that we need to be given proper funding once and for all. We cannot just keep on issuing endless directives and regulations, often without sufficient background information, scientific basis and generally to unbelievably short deadlines.
Allow me to make a comment: I am not the only one who constantly has the impression in these circumstances that my only purpose in sitting on the Committee on the Environment, Public Health and Consumer Policy is to prevent the worst in the frenzy and rush of regulation which is thrust upon us.
We must not lose our sense of environmental direction by promoting small, local measures, however badly they may be needed, or by blindly shelling out money to institutions which appear to produce little in the way of results, which applies, in my view, to the European Environment Agency in Copenhagen.
What European environmental policy needs is a scientifically-based framework for action. That is something we do not have. And that is because we lack the foundations. We need to invest in scientific research and analysis. Only then shall we be able to work out realistic prospects, prospects for linking environmental and health policies to other policy areas, prospects for what promises to be a successful and realistic approach to problem-solving. That is the only right and the only sensible way of investing the money at our disposal on behalf of our fellow citizens.

Laschet
Mr President, Commissioner, ladies and gentlemen, I have three comments to make on what has been said during this debate. The first relates to something which you reminded us of this morning, Mrs Schreyer. Compared with many national budgets, the increase in the Community is somewhat higher but, in relation to expenditure ratios, it is still very low and sets an excellent example for many national budgets. We must tell the public that, if the national foreign or other secretaries of state keep handing work over to be carried out at European level, such as the whole Balkans programme, then we must also bear in mind that this work requires money and that funds must be made available.
My second comment relates to the common foreign and security policy. Tremendous progress was made here during the 1990s. During the conflict in Bosnia, Europe was still not in a position to speak with one voice: one country was purported to be on the side of the Serbs, another to be on the side of the Croats. We almost seemed to be back in the policy of alliances of the 19th century. Now, at the end of this century, at the end of the 1990s, Europe is speaking with one voice, Europe is the biggest civil reconstructor in the Balkans, bigger than the United States, and is doing a good job; through its budget and its policy it really did help to make peaceful revolution possible in Serbia. This needed to be said quite clearly about European policy at the end of this financial year and after this decade of confusion in the Balkans.
Foreign states are becoming more important to us and we hope that, with the new posts provided, the Commission will do the job which we expect it to do. We are being up front with our praise and you may be sure that we shall seek to exercise strict control in the future.
There is much talk of post-Nice. Nice was yet again the scene of national haggling for individual states. We have overcome this to a considerable degree in foreign policy and I hope in the forthcoming budget debates that we shall take more decisions of substance and spend more time on the problems and less time haggling over national interests in this budget.

Schreyer
Mr President, honourable members, I only intend to comment on certain aspects raised during the debate. First, the structure of the budget in 2001: one speaker said that the agricultural budget would not rise sufficiently. However, I must stress that the agricultural budget has a very high rate of growth, namely 5.7%. If we include the expected supplementary budget, it comes out at nearly 8%, while other areas, such as training policy, the whole of internal policy - including research -, foreign policy, administration and accession aid have together only risen by 1.1%. We really must stress, therefore, that Parliament too has exercised immense budgetary discipline in the areas in which it has the last word but has, I think, brought about an excellent result with clear priorities nonetheless.
On Mr Mulder's comment: you noted that, because the budget at second reading was below the margin in agricultural policy, the risk of a change in exchange rates needed to be included in the calculation, because it would be not unwelcome if the euro were to rise against the dollar. I would draw your attention here to the rules of the Interinstitutional Agreement, which state that a "currency risk" of up to EUR 200 million must be financed from the agricultural policy and that only then can recourse be taken to the currency reserve. However, my view is that we should in fact take care in the supplementary budget to keep this reserve at EUR 200 million so that we do not have to take other measures if there is the slightest change in the exchange rate.
To Mrs Sommer's comment that too little account is taken of environmental aspects in the European Union budget, allow me to point out that one third of the budget is spent on structural policy and that we have mainstreaming in structural policy; we have gender mainstreaming to ensure that structural policy measures provide equal opportunities for men and women. The money must be used in order to increase employment and - and this is the third mainstreaming - it must be used in order to improve the environmental situation. That gives us an enormous amount of money to play with.
May I also point out that the EUR 4.5 billion under agricultural policy for developing the countryside, which we discussed this morning, includes numerous measures to promote environmental protection. In addition, agricultural policy also includes something in this area which is not standard practice in environmental policy and which fundamentalists may occasionally take a dim view of: namely that compensation is paid for refraining from taking environmentally damaging action. Here are your measures which quite explicitly promote environmental protection.
I should like to comment again on the charming question put by Mr Colom i Naval this morning. He asked what was the difference between revising the financial perspective and using the flexibility instrument? You are, of course, quite right to keep reverting to this question. I see it like this: revising the financial perspective means that if we make an increase on one side, we must at the same time decide where savings can be made. This requirement does not apply to the flexibility reserve. In this respect, the finance ministers' reluctance to revise the financial perspective is even harder to understand. Oh well, we live and learn. I guess this example also illustrates the fact that sometimes principles count for more than budgetary intentions.
I think it is a good thing that we have succeeded in activating the flexibility instruments and giving Serbia the help it needs on this occasion, although I fully agree with you that our strategy must be such that we prevent the phenomenon from arising whereby a European flexibility instrument wanders from one region or country of Europe to another, depending on where it is needed.
In closing, I should like once again to stress that, in the Commission's view, the 2001 budget provides an excellent basis on which we can together forge a good Community policy for Europe and I should like to thank you for the excellent cooperation. And we shall have the opportunity of continuing this excellent cooperation on the supplementary budget in January. But first I should like to wish all those involved in the budget a Happy Christmas!

President
Thank you very much, Commissioner. Parliament also wishes you a Happy Christmas.
The debate is closed.
The vote will take place on Thursday from 10.00 a.m.

Common strategy towards the Russian Federation
President
The next item is the debate on the report (A5-0363/2000) by Mr Oostlander, on behalf of the Committee on Foreign Affairs, Human Rights, Common Security and Defence Policy, on the application of the European Union' s common strategy on the Russian Federation [2000/2007(INI)].

Oostlander
Mr President, our relations with Russia underwent a fundamental change when the cold war ended. Fear of military violence or of a dictatorship that might advance further, is a thing of the past.
The attitude of the European Union and its Member States is now more one of a feeling of joint responsibility for the restoration of Russian society. It can be regarded as a kind of moral duty but also as being in the interests of the European Union, which, of course, has nothing to gain from lawlessness and poverty in a very large neighbouring country.
Yet for many of us, the development of the Russian Federation is still a dubious matter and that is why I can imagine that people sometimes have their doubts about it, even in this Parliament. In any case, the best thing we can do in our strategy towards the Russian Federation is to follow a twin-track strategy. On the one hand, we must indict those who violate human rights and wield a disproportionate amount of power, clearly and forcefully, and on the other, we must enter into cooperation in a variety of sectors. Both approaches are necessary if we are to help Russia become a flourishing, democratic constitutional state. This is in our mutual interest. That means condemning the gross violence in Chechnya and looking for ways of helping to end the war and assuage the suffering. So it is necessary for the European Union and the OECD to be present there. We know, I am happy to say, that people in Russia are not indifferent to our criticism of what is happening there. That comes up in quite a few conversations one has in Russia. After all, Russia too wants to be assessed by the same standards that we apply to ourselves.
We would also do well to be severely critical of the visa measures vis-à-vis Georgia that have recently been undertaken, and provided for in amendments. I am expecting a more extensive discussion to take place next month via the topical and urgent debate, and would suggest that we only give a limited preview of this debate in these resolutions. In particular, I hope to be able to adopt half of the amendment tabled by the Greens on this issue. It also behoves us to criticise the relations between Russia and the Baltic States, which are still to be regularised. It will not be the fault of the latter. They need Russia to regularise and establish its affairs with them effectively.
As far as cooperation with Russia is concerned, the Russian response to the strategy document of the European Union offers some good starting points. The entry into force of scientific and technological cooperation with the Russian Federation is a good example. In retrospect, the interruption of this cooperation was not a success, particularly as there appears to be little coordination in actions of this kind, between the European Union on the one hand and other major players, such as Japan and the United States, on the other. We must take this lesson to heart for future reference.
The Northern Dimension is a clear example of cooperation that is to be put into concrete form. In point of fact, this concept is underused, politically speaking. It is an important concept, particularly in the fields of energy provision, care for the environment, the clearing up of nuclear waste, and the decommissioning of nuclear submarines. In addition, it is possible to achieve various forms of cross-border cooperation that will prevent sharp disparities in wealth from arising. Initiatives concerning cooperation with the region of Kaliningrad fit into the same framework.
We would argue in favour of having a separate budgetary line for developing this Northern Dimension in a coherent manner, along the lines of the one that we already have for cooperation with the three Baltic States. However, I am of the opinion that the importance of Russia is not really reflected in the budget, but we disagree with the Social Democrats on that score. If you take a close look, then roughly speaking, Russia is slightly ahead of Morocco in terms of budgetary importance, which cannot be right to my mind. I could live with it though, if recital G on this aspect were to lapse, and in so doing if it were to be possible, with the support of the Social Democrats, to achieve a broader majority for this resolution, because this would send out a clearer signal to Russia.
We are hoping that the cooperation will extend to external policy. The resolution refers to the Commission as the initiator of policy and to the High Representative as the coordinator of policy. There are various regions where we could start the ball rolling, such as the Balkans, the Caucasus region and Central Asia. A more relaxed discussion of mutual security interests would also have its uses, bearing in mind that, naturally, from my point of view and that of others and the majority of my group, NATO, and within this framework, our bond with North America, are absolutely paramount in matters of security.
We will follow the developments in Russian society and internal politics with great interest. We hope that a truly civil society will soon flourish there and form the permanent basis for a real political democracy. I hope that links will be established at all levels between organisations, individuals and associations in the EU and their counterparts in the Russian Federation. This will help to spread awareness of the values we all share.

Van Orden
Mr President, Russia has yet to come to terms with herself, to decide what sort of society she wants to create and define her position in the world. For over seventy years, her development was distorted and held back by the monstrous experiment of communism which grew to threaten us all. I must say I very much welcome Mr Oostlander's report for its very reasonable and balanced approach, praising constructive reforms while criticising blatant human rights abuses. But let me say a couple of words about our strategic relationship.
While encouraging a strong economic relationship between the European Union and Russia coupled with efforts at political cooperation, we must take care that we do not create for ourselves some sort of strategic dependency. For example, it has been suggested in the context of European defence policy - about which I have to say we continue to have reservations - that the European Union might turn to Russia to provide strategic airlift capabilities to complement the arrangements already in place between the WEU and Ukraine. Now I am in favour of encouraging Russia and the Ukraine to move in our direction and cooperate with other alliance countries in crisis-management tasks, but I would not be in favour of us moving in their direction or adjusting our policies in order to accommodate them.
It would be a very dangerous situation if the Europeans were to become logistically reliant on Russia. If we do not have our own strategic airlift then we already have a tried and tested ally in the United States - and in this context I am sure that Mr Oostlander has no desire for Russia to supplant the United States as a strategic partner for Europe. We must work in the closest possible harmony with the United States in our dealings with Russia and certainly must not give Russia the impression that there are divisions to be exploited. This would be in no one's interests.
Secondly, we must take great care to ensure diversity of production and supply in terms of energy. Already some 40% of natural gas supply for the EU comes from Russia, and an increasing proportion of oil imports now come from the CIS countries, where known reserves are larger than those in the United States and North Sea combined. Many of the transit routes for these are through areas of great conflict. It is in our interests to do all we can to help stabilise that region by economic and political means, ensuring that we do nothing to encourage or sustain instability in the Caucasus and the southern regions of Russia.

Krehl
Mr President, ladies and gentlemen, the common strategy towards the Russian Federation was the first common strategy in the history of the European Union. That alone illustrates the importance which the EU attaches to its relations with the Russian Federation. The dual strategy of cooperation and criticism which Mr Oostlander develops in his report is, in the opinion of my group, eminently suited to the situation in the Russian Federation. However, this sort of strategy is a complex subject and all the institutions and the Member States must approach it in a strictly coordinated and circumspect manner.
As the Oostlander report demonstrates, this is not always easy and Parliament must ensure that it works in a very orderly fashion here.
Now to the most important points in the report: the Russian Federation is important to the Union for both security policy and economic reasons, of that there can be no doubt. The PCA provides the necessary contractual basis here and - if it is applied fully - the instruments needed in order to react to a whole spectrum of developments. The agreement contains a human rights clause and provisions governing the establishment of democratic rule of law. Our economic relations with the Russian Federation have fluctuated enormously over past years, depending on various crisis situations. But, most importantly, there is a lack of foreign investment in the Russian Federation, coupled with a huge drain on the profits of Russia companies.
Unless the Russian Federation rectifies this situation by creating, post haste, the necessary legal and security framework and hence a more friendly investment climate, there would appear to be no way out of the economic crisis, high oil prices notwithstanding. And programmes such as TACIS can only be of limited help here - more to the point, they barely scratch the surface.
The Commission's priority task should therefore be to improve the effectiveness of the funds deployed under the programme and, more importantly, to enhance its visibility. What is important, I think, is that it should continue to be the political responsibility of the administrative staff and should not turn into project management.

Schroedter
Mr President, ladies and gentlemen, I think we often underestimate the fact that a balance struck with the Russian Federation is a guarantee of peace in Europe. This highlights the importance of the strategy towards the Russian Federation and, at the same time, the importance of your report, Mr Oostlander. However, as we have already said, the Russian Federation is a difficult partner. Even if President Putin guarantees the democratic development of his country, that does not automatically guarantee a stable and democratic Russian Federation. Basic democratic order is not a fact of life in the Russian Federation and this is a problem, especially when it comes to cooperation with the European Union, because, for us, any such cooperation must be based on respect for human and minority rights, and we have made that clear. This means that the twin-track strategy posited in the report is very, very important. We want outstanding cooperation with the Russian Federation, but we cannot accept the Russian Federation's continuing to wage war on its own people in Chechnya, a war which has continued uninterrupted for a year now.
We are also hugely critical of the Russian Federation's provocative visa policy towards Georgia and call for this decision to be revoked at once. Nor can we tolerate the manner in which the freedom of the press is trampled underfoot in the Russian Federation.
I think the Prodi plan may bring a new dimension to cooperation with the Russian Federation and provides an important basis. Let us not forget the basis we had in the European Union, with the coal and steel plan guaranteeing lasting peaceful cooperation between France and Germany. And look where we are now. The energy community with the Russian Federation may well take on a political dimension in exactly the same way. That means that we have a joint responsibility for peace in the Caucasus, for environmental protection in the Russian Federation and for the rights of its indigenous people.

Seppänen
Mr President, we must establish cooperation with Russia, a country wounded in its statehood, so that she can become a European state that aspires to education and culture. Mr Oostlander' s report is crucially important and it sets out to achieve this cooperation. We have to use our combined powers to heal the wounds that ten years of crude capitalism have inflicted on Russia. Boycotts will not resolve the problem. Things are now going badly for Russia. There is no middle class: there are just the super-rich and the super-poor. Half the population live below the poverty line. The country is in sharp moral decline: it is almost like Sodom and Gomorra. There are fears that the number of HIV-positive cases will rise in the next few years to close on 600 000, and the disease is also beginning to hit young people hard. Eighty per cent of new infections concern people under the age of 25. The birth rate is dropping, the mortality rate is going up, and the net loss in Russia' s population amounts to a million a year. That goes to show just how bad things are for the people there.
The country is also burdened by the need to protect nature and human beings from old mistakes. There are still 300 tons of anthrax bacteria manufactured for purposes of biological warfare in existence there, and just a small dose is lethal. Dozens of tons of waste plutonium have to be destroyed as a result of disarmament negotiations. The EU must help Russia, because in that way it is also preventing risks that would threaten itself.
The most important area of cooperation is energy policy, which is connected with superpower politics, which governs, for example, the transportation of oil and gas from the east to the west. Today 30-40% of EU gas comes from Russia, and in ten years' time the EU will be almost totally dependent on Russian gas. There is no northern, western or southern alternative for this. The EU countries should not be a geopolitical extension of the United States in matters of gas and oil pipelines. The EU is no threat to the Russians, but a unipolar world under the leadership of the USA is. The Russians cannot, at least not yet, oppose NATO' s sly expansion through the militarisation of EU structures. Slyness does not become us: we must build a Europe of economic cooperation.

Dupuis
Mr President, Commissioner, ladies and gentlemen, I think we should pay tribute to Mr Oostlander for having stressed the importance of the role of the Commission and, in particular, of Mr Patten as the Commissioner responsible for external relations, in the implementation of this common strategy. Contrary to what previous speakers have said, I do not believe that this strategy has been successful to date. Unfortunately, the major financial scandals which continue to punctuate relations between Russia and international finance, and a number of projects involving the international community, clearly illustrate as much.
I cannot really agree with Mr Oostlander' s approach to the issue of human rights and democracy in the context of the Russian Federation. I have put forward a number of amendments intended to place rather more emphasis on these issues. Mr Oostlander does not customarily welcome my amendments and I was not therefore very surprised to see that they had not been included.
Regarding Chechnya, in particular, I do not think it is possible to say, Mr Oostlander, that the solution cannot be purely military. I think that the solution cannot be military, as the situation clearly demonstrates, and that it can only be political. Mr Putin himself - and we would not even be going as far as him - said that the issue of the future status of Chechnya is not the main issue. Yet we do not dare say as much in our report. This, I believe, is not acceptable. Nor do I think it acceptable, moreover, to fail to state that it is absolutely intolerable, after one and a half years of war in Chechnya, that our Commissioner for humanitarian aid, Mr Nielson, has not yet truly set foot in Chechnya. Nor do I think it acceptable that the European Union should fail to respond to the murders of journalists covering the war in Chechnya. These are not isolated instances but repeated occurrences. A member of my party, a radical militant journalist, was murdered several weeks ago in Tbilisi, a city clearly under the control of Russian troops. I do not feel the Commission and the Council can fail to respond to an event of such seriousness.
Mr Van Orden is quite right in what he says regarding the Caucasus. We are currently witnesses to an absolutely dreadful deterioration of the situation in Georgia. The country is completely destabilised, literally strangled by the Russian Federation. It is on the point of collapse and the European Union is offering no practical response to this rejection, this ban by the Russian authorities regarding the introduction of visas. It could respond by cancelling visas for Georgians travelling to the European Union. It could and should start to consider Georgia' s accession before it is too late, before there is another Balkans situation at the very gateway to Europe.

Belder
Mr President, the current line taken by the Kremlin does not give the least cause for optimism. On the domestic front, President Putin has explicitly opted for an enforced recentralisation policy, his watchword being 'all power to the Kremlin' . When it comes to overseas affairs, Moscow does not wish to comply with international obligations. The attitude of the Russian diplomats at the OSCE Summit held in Vienna at the end of November, spoke volumes in this respect. There is to be no withdrawal of Russian troops from Moldova, nor are the Russian military bases in Georgia to be closed.
Incidentally, how does the EU view the latest Russian manoeuvre against Georgia? I am referring to the introduction of a visa obligation for Georgians, with the exception of the Abkhazians and the South Ossetians. Surely that is completely out of kilter with the rapporteur' s idea of a certain degree of convergence between the foreign and security policy of the European Union and Russia in the Caucasus? After all, that would be sending out the wrong signal to Kremlin boss Putin at entirely the wrong moment.
The famous Russian opposition politician, Grigori Jawlinski, has made it into western newspaper columns again lately. Using cutting words he condemned the uncritical stance of the West towards the occupant of the Kremlin. He said western politicians do not understand Russia. Indeed, they fear Russia. Hence they choose the line of least resistance. They want to have a friend in the Kremlin. It makes no odds to the west what is happening with Russia, its people and society.
Mr Oostlander' s report contradicts the latter sentiment and I would like to compliment him on that. And yet Jawlinkski' s portrayal of Europe' s struggle with the phenomenon of Russia is very apt.

Väyrynen
Mr President, may I, on behalf of the European Liberal Democrats, thank and congratulate Mr Oostlander. His was a well prepared report. The Committee on Foreign Affairs, Human Rights, and Common Security and Defence Policy got its most important proposals approved and in the final vote we supported the adoption of the report.
Mr Oostlander' s report clearly denounces the excessive use of force that Russia was guilty of in Chechnya. Failings in the implementation of human rights and democracy have also been clearly brought to light. On the other hand, the report supports a strategic partnership between the EU and Russia. Cooperation with Russia needs to be reinforced. A separate budgetary heading is being proposed for the Northern Dimension and increased aid to Russia, in general, is being recommended. The report also supports the development of energy cooperation between the Union and Russia. It is important for the Union that the availability of oil and natural gas is secured by creating alternatives. Moves to exploit the gas and oil resources in the Barents region should be speeded up, while, at the same time, production in the Komi and Caspian Sea regions and the infrastructure for transporting the products out of those regions should be improved in terms of technology.
Now that the Nice Summit seems to be opening up the avenue towards swift enlargement of the Union, it is important to show determination in getting to grips with those problems which enlargement threatens to create for relations between the Member States and Russia. We need flexibility, particularly in arrangements regarding trade and the mobility of people. However, the main solution is for cooperation between the Union and Russia to be enhanced, bringing down the barriers between us. As the Union expands it will also be important to think about its internal differentiation, which might, for its part, ease border area problems. On the other hand, there is reason to hope the Russian Federation will also consider decentralising the power of decision and the issue of internal differentiation, allowing the possibility of abolishing borders. By this I mean, for example, making special economic areas of Kaliningrad, Murmansk, Karelia and other parts of Russia bordering the Union.

Gahler
Mr President, I should like to thank Mr Oostlander for his outstanding and comprehensive report, for the extraordinary amount of time which he has invested in it and for his receptiveness to suggestion.
Anyone looking at Russia from the outside and with the odd personal experience from visiting the country itself and speaking to Russian counterparts will soon be in danger of selectively tailoring reality in the Russian Federation to fit his personal image. Current discussions on the Russian state symbol show that there are several takes on reality in the Russian Federation. The national flag of Peter the Great flutters alongside the army's red flag and the national coat of arms showing the Tsarist double-headed eagle is displayed while Stalinist national anthems are being sung. These symbols are perhaps not as contradictory as they first appear, each reflecting as it does a facet of an authoritarian state.
But a whole spectrum lies between these diametrically-opposed historical perspectives and pro-active Russian society will certainly refuse to be reduced to or guided towards any of these authoritarian alternatives. I personally become more and more enthusiastic when I meet young, open, well-educated Russians and more and more depressed by Russian structures, be they state, economic or even mafia structures. The best way we can help the Russian Federation is, on the one hand, to refrain from wholesale damnation and clearly address unhealthy structures or individual policies, such as the Chechen policy and, on the one hand, to value positive developments, without talking up, writing up or thinking up the Russian Federation as a whole. We can contribute towards stability from the outside by sending the Russian Federation clear and specific signals as to how we wish to configure our cooperation. Once Poland and the Baltic States accede to the EU, we hope to use the greater geographical proximity to the Russian Federation to strengthen cross-border cooperation in the area of Saint Petersburg, Nowgorod and Kaliningrad. Transport, energy, the environment and internal security are right at the top of the list of possibilities.
Negotiations to find creative solutions as regards the future freedom of transit for the people of Kaliningrad through Lithuania and Poland should also be completed before Poland and Lithuania accede to the EU. Why not make the Oblast of Kaliningrad a pilot project on two counts: first in relation to the potential for economic cooperation between the Russian Federation and the EU and, secondly, to test the Russian Federation's ability to implement fundamental reforms such as rural, fiscal and administrative reforms in advance in this area with our support? That is the way to bind the Russian Federation to the EU.

Hoff
Mr President, in recent years the European Union has finalised various documents relating to the Russian Federation which form a good basis for close relations with it. The common strategy is one of them. Despite all its contradictions, Europeans clearly see Russia as part of Europe and have a huge interest in a stable, democratically-organised Russian Federation with good economic prospects which plays a confident part in and helps to shape international policy. The West also needs the Russian Federation as an important international partner if Europe is to be reshaped after the change. It is this interest which has led the Union to develop specific fields of activity in numerous areas in the common strategy towards the Russian Federation and other documents.
They include consolidating the rule of law and strengthening government institutions. They also include developing a civil society as an important precondition to consolidating democracy. In the economic sector, the Union is endeavouring to integrate the Russian Federation into a common economic and social area. The Union is already the Russian Federation's most important processing, investment and trading partner, accounting for over 40%. But there is still huge potential here. Experts have calculated that trade between the European Union and the Russian Federation only accounts for one-third of what might be expected, given the Russian Federation's gross national product and its proximity to EU markets.
In the political sector, the common strategy towards the Russian Federation proposes entering into a standing dialogue on policy and security and creating a permanent mechanism for such dialogue. It would be interesting to expound on this, but time is too short. The EU sets great store in its Russian policy by environmental protection and nuclear safety. Unfortunately, this momentum in relations between the Russian Federation and the EU has come up against a counter force - cue Chechnya, which has seriously hampered relations. The substance and methods of the internal consolidation being pursued by the Putin regime will have a significant influence on the nature of our relations. We can only hope that the current pragmatic and realistic partnership will perhaps one day become a real strategic partnership.

Laguiller
Mr President, given the economic and geopolitical importance of Russia, the European Union believes it must seek a common strategy on the subject. The report contains many empty phrases and, in particular, pious hopes. It is not just because each of the major European powers is primarily concerned with safeguarding the interests of its own capitalist groups, but in the final analysis, what does capitalist Europe have to offer Russia?
Economic growth? Yet for the last ten years the Russian economy has done nothing but collapse. An end to the preponderance of queues? Yet what use are more or less well stocked shops if, with unemployment, and retirement pensions and wages at a low level or not even paid, one third of the population is living below the poverty line and does not have any money to buy the goods? Democracy? Yet under the guise of democracy there is domination by official and unofficial mafias. Freedom? Yet the freedom which the reintroduction of capitalism has brought Russia is freedom only for a narrow range of bureaucrats left over from the previous regime to pillage natural resources and transfer the proceeds to Western banks. And indeed, what does freedom mean for the Chechen people?
In voting against this report I wish to stress the inability of the capitalist economy and the western world to bring progress and prosperity to the peoples of the Russian Federation or indeed to the majority of peoples on this earth.

Sacrédeus
Mr President, I should like to thank Mr Oostlander for his sterling contribution as rapporteur. As a Swedish Christian Democrat, I fully support the two-strategy model which Mr Oostlander presents, involving vigorous, consistent and sustained criticism of all crimes, especially crimes within Russia against human rights, but also involving close and intimate cooperation with Russia, our large neighbour in the East.
Recital KK in the report states the following: 'given that Russia is in a political union with Belarus, it is appropriate in the interest of Russia' s democratic legitimacy for President Putin and the Russian government to point out clearly and consistently the comprehensive need for democratic progress and reforms in Belarus, not least in the light of the report submitted by the parliamentary troika from the EU, the Council of Europe and the Organisation for Security and Cooperation in Europe (OSCE) in Minsk on 16 October 2000' . I am the author of that paragraph, which has been applauded in the Committee on Foreign Affairs, Human Rights, Common Security and Defence Policy. I should here like to highlight the value of our really emphasising the seriousness of Russia' s in actual fact being in a political union with Belarus.
With reference to the report we presented in Minsk, we first of all emphasised that the Belarus Parliament is at present lacking in powers, cannot legislate, does not have the right of veto against Presidential decrees and cannot adopt budgets. Secondly, we pointed out that electoral law has disqualified a quarter of the candidates in this so-called parliamentary election in October. Thirdly, we discussed access to the media, which is unfairly organised in a State-controlled system. Fourthly, we discussed the administrative criminal law which makes it illegal to urge a boycott of elections.
Belarus is therefore in political union with Russia. It is important for us to emphasise the seriousness of this for Russia too.

Paasilinna
Mr President, Commissioner, ladies and gentlemen, questions of human rights are important to us, and they are not the private affairs of any one country. The war in Chechnya is a case in point, and, for example, this labour legislation now under discussion will reduce employees' rights quite drastically. We have, however, tried a boycott policy, and that had no effect on this war. The twin-track strategy proposed by Mr Oostlander offers a way out, for which I thank him. This is the first strategy on Russia in our history. Multi-faceted cooperation will help to stabilise conditions in Russia. That will be the first step, after which attempts will be made to achieve respect for the law, which will be the second step, and then, economic development will bring more stability, all of which will bring about the features of civil society we expect. The result will finally be more human rights, which we all desire. This report thus creates the possibility for constructing a multilayer structure. For this reason I think it will be an important breakthrough. We have already laid the foundations of a period of cooperation with Russia during which the political leadership has changed. We uphold the criticisms, but we will not sever our contact as we did after the civil war, which was followed by Stalin' s persecutions and all the terrors.
The Northern Dimension, which is important, will receive its own budget funds under this proposal, which is a very important issue. I, myself, suggest that energy should be made the driving force behind this important project, as that is something we need, that is where the money is, and since we have the money, we can also spend it on the infrastructure, on hospitals, environmental issues and so on. Money from energy: both sides need cooperation for that, and especially in parts of northern Russia, which I would urge Russia to turn to. It is peaceful there and soldiers are not needed to guard the pipeline. Do you intend to support a project such as this, Commissioner Patten?

Alavanos
Mr President, a few days ago, the Duma decided that the Soviet anthem would be Russia's national anthem. The music and words and the decision by the Duma are not overly significant. What is significant is that the majority of Russian citizens supported this move. What I want to know is why these people did not choose the Marseillaise or God save the Queen as their anthem of hope for a brave new world, preferring instead to turn the clock back to a regime which many of my fellow members have described as inhumane, criminal and so on.
What is the significance of the ten years since Russia was suddenly catapulted into the free market and into contact with western values? Do we not know what their significance is? The responsibilities are, of course, mainly Russia's, both for the past and the present. But do the European Union, the United States and the other powers bear no responsibility? This is the mafia we are talking about. Where does the mafia have its roots, if not within the Kremlin itself? Who were Yeltsin's protectors and agents all that time? Who fought tooth and nail to support Yeltsin inside Russia? This is power hijacking we are talking about. Which banks is the money from foreign loans and/or the money hoarded inside Russia paid into? Is it the Bank of Havana or the Bank of Algeria? It is paid into the large western banks! And how is it controlled? And where are the prostitution networks operating?
What I am getting at is that someone must take responsibility for what has happened over the past ten years, including the European Union. From what certain speakers have said, the winner-takes-all model obviously applies. The cold-war model has been replaced by the winner-takes-all model. What are we afraid of? Dependency on Russia? Can the entire European Union, with Germany, the United Kingdom, Italy, Spain and everyone else present in Nice really depend on Russia? Or will we opt for mutual dependency as we do with every other large power in today's world?
The point at issue here is Russia's role. What was Russia's role when NATO was taking decisions on a neighbouring area, on the Balkans, without so much as a nod to the UN, to which Russia belongs, or to the Organisation for Security and Cooperation in Europe? How come this power was not terrified? What I am trying to say is that we need to change our stand: we must not feel and we must not sow the seeds of fear; we must look for a partner which needs our help and support.

Patten
I very much welcome this report and I should like to pay tribute to Mr Oostlander for producing it. His report has been welcomed by all parts of Parliament except, perhaps by those who look back with nostalgia to the not-so-golden days memorialised by a very large number of brave Soviet dissidents. But it is an excellent report which, like the common strategy itself, underlines the importance that we attach to the relationship - the strategic partnership - between the European Union and Russia.
The report endorses what is being called our "double track strategy" towards Russia, a strategy that combines plain speaking on issues like Chechnya - to which I will return in a few moments - with a continuing effort to build an effective relationship based on shared values and cooperation.
The common strategy and Russia's medium-term strategy for relations with the EU have created a new dynamism. The common strategy identified initiatives in foreign policy, security and the fight against crime. Other areas where we seek to bolster European Union cooperative efforts towards Russia are the rule of law and democracy building, civil society, twinnings as well as regional and cross-border cooperation and, above all, the Northern Dimension Initiative, to which a number of Members referred.
We strongly support the Russian Government's economic reform programme which is vital to improve the investment climate. In this context, as Parliament will know, at the last summit between the European Union and Russia, Romano Prodi launched a far-reaching dialogue on energy.
These are all areas in which the Commission has a powerful contribution to make, as the report repeatedly makes clear. Our technical assistance programme - in particular Tacis - already responds to many of the priorities identified by this report. The core Tacis Programme, worth EUR 34 million, focuses on education, the rule of law, democracy and civil society development, including regional media freedom, protection of individual rights and support to self-government. The subsequent action programme - to a value of EUR 58 million - focuses on institution-building, on the rule of law in the economic field and on improvements to the business and investment climate.
The honourable Member's report rightly stresses the need for our Moscow delegation to play a bigger part in the management of our financial assistance, and I am determined to see significant progress in this direction as part of our wider reform of European Union external aid programmes.
The report comments on the Northern Dimension. We too see this as an important mechanism for regional cooperation for the development of the north-west Russian regions as well as Kaliningrad. I am anxious to work closely with the incoming Swedish presidency to make concrete progress on the Northern Dimension. This means concentrating our efforts on key areas like the environment - which has been referred to by a number of Members - and nuclear safety, on Kaliningrad itself and on improving coordination between different sources of funding.
We are acutely aware of the urgent need to tackle environmental threats from nuclear storage facilities and rusting decommissioned submarines, especially in the north-west part of Russia, for example, around the Kola Peninsula. This is a formidable task. It requires a combined international and Russian effort. The Commission has taken a leading role in the negotiation of an international agreement establishing the multilateral nuclear environment programme for Russia. Those negotiations are now at a key stage and we hope for significant progress by March 2001.
There is also a pressing need to raise environmental awareness in Russia. This is exactly the objective of the environmental work programme for the Russian Federation, initialled last June in the framework of our partnership and cooperation agreement.
Just a word on Kaliningrad: the partnership and cooperation agreement already offers an institutional framework for our dialogue with Russia on trade, visa and border issues. At the same time the development of the region has already benefited from Tacis projects amounting to about EUR 30 million since 1991. We are now finalising a communication to the Council on Kaliningrad. We are in the process of opening an office in Kaliningrad. I very much hope to visit Kaliningrad myself in the early part of next year, and not just because Immanuel Kant spent the whole of his life there. It is a serious issue that we need to address as part of the Northern Dimension.
In all of the areas I have outlined we are working closely with Russia to our mutual benefit. We are working to strengthen Russian democracy, reinforce the rule of law and transform the Russian economy. That is all to the good, but there remains one serious impediment to further improvements in the ties between Russia and the European Union: I refer, of course, to Chechnya.
At the last European Union Russian Summit in October, President Putin acknowledged the urgent need for a political solution to the conflict. I have to say to honourable Members - and I will abbreviate what I might have said at much greater length - we are profoundly concerned about the humanitarian situation in Chechnya. We are concerned about the continuing reports of human rights abuses, for example from NGOs like Médecins sans Frontières and Human Rights Watch. We hope that we will be able to make a great deal more progress with the Russian authorities in addressing those issues in the months ahead. We are profoundly concerned about the likely fate of thousands of refugees in Ingushetiya and Chechnya this coming winter.
It is because we take our relationship with Russia so seriously that these issues matter. They cannot just be brushed under the carpet. We have to return to them again and again, but we must also continue, as the honourable gentleman's report wisely recognises, to engage with Russia. We must avoid the mistake to which an honourable gentleman referred earlier, which was made at the start of the last century, when Russia was effectively excluded from European affairs after the Leninist revolution in 1917 with disastrous consequences. We shall therefore persevere with the common strategy to build on the progress achieved to heed many of the points raised in the honourable gentleman's report, and above all to strengthen the hands of the Russian Federation.
Just one further word about a point that was raised by a couple of speakers in the debate - and that is the question of Georgia and visas. We have already expressed serious concern over the way in which Russia unilaterally introduced visa requirements for Georgian citizens on 5 December. The entire international community, not excluding Russia, is committed to supporting the sovereignty and territorial integrity of the independent states. Actions by any country in the region which could have the effect of undermining that sovereignty carry significant implications. If more favourable visa requirements are applied to the inhabitants of secessionist regions or if they are exempted altogether, this would imply support for the legitimacy of their regimes.
Georgia is a member of the United Nations, a member of the OSCE, a member of the Council of Europe, and it has a partnership and cooperation agreement with the European Union. It deserves our support. We call upon the states of the region to use the OSCE mechanisms to resolve their disputes quickly before real damage can be caused.
I congratulate the honourable gentleman once again on an extremely good report on a very important issue, to which I am sure we will return in this Parliament over the next few years again and again. The honourable gentleman has given us a very important and useful political and intellectual infrastructure for our future discussions.

President
 Thank you, Commissioner.
The debate is closed.
The vote will take place tomorrow at 11.30 a.m.

Question Time (Council)
President
The next item is questions to the Council (B5-0559/2000).

Mihail Papayannakis
Question No 1 by (H-0864/00):
Subject: Genetically modified organisms and crops Since the Spring of this year there have been many cases of the release into the environment in various EU countries of genetically modified organisms and crops, namely cotton, oil seed rape and maize. In some cases measures have been taken, but not in others, and in certain instances no official announcements or findings have been made. It should be pointed out that in many cases Directive 90/220/EEC has clearly been repeatedly breached. What action does the Council intend to take to address these problems and, in particular, what position does it intend to adopt in the short and longer term?

Moscovici
As you know, the Council adopted a common position on the revision of Directive 90/220/EC. The new text provides for much stricter conditions on the use and marketing of genetically modified organisms. The Commission considers that once this new directive has come into force, it will make it possible to improve the current situation.
The Council, meanwhile, wishes to see this directive adopted rapidly in order to provide a stricter framework for the introduction of new GMOs onto European Union territory. The Council also wishes to point out that it is in fact up to the Commission to monitor the implementation of Community legislation.
In transposing the directive into their national legislation, Member States will have to ensure that the directive in question is properly implemented and will have to send the Commission a brief factual report at each year end on the monitoring of the use of all products placed on the market, in compliance with Article 18 of the directive. Moreover, the Member States and the Commission meet regularly in order to exchange information on experience gained in the area of risk prevention related to the spread of GMOs in the environment.
Finally, at the Internal Market, Consumers and Tourism Council on 30 November 2000, the Commission presented an information report on the labelling and traceability of GMOs. The Council will examine the Commission proposals at the Environment Council on 18 and 19 December.

Papayannakis
Thank you very much, Minister, for your answer. The question was as follows: there have been cases where this directive has been breached and GMOs have been released into the environment. I gave examples in my question. You are placing me in a very difficult position. It is the task of the Commission to ensure that the directive is adhered to. It has probably not done so or has done so inefficiently, I do not know. It is the task of Member States to implement the directive, transposing it into their national legislation. In the case in question, the Member State has not done so. I should like to think this was an oversight.
In Greece, we have been told, in the case of modified cotton, that it would be exported. The Commission' s answer to a question similar to the one I have asked was that farmers were to be compensated and that the genetically modified cotton was to be exported. Will the Council be able to help me out of this difficult position? To whom should I turn for information? Is it really legal to export this type of material? I still find it hard to believe, Minister, and I should like an answer.

Moscovici
I would remind you that the Council has determined its common position on this proposal and that conciliation therefore is drawing to a close. The entire procedure should be concluded by 4 January 2001 at the latest. This common position sets much more stringent requirements for the Member States. I therefore believe that this is where you will find an answer to your questions. Mr Papayannakis, I have given you all the information I have.

Purvis
Could the President-in-Office agree that there can be substantial benefits for the environment, human health, developing countries and European science and business from GMO crops? Is there a risk that Europe could miss out on the benefits if we respond to hysteria rather than to scientific fact?
The Lisbon Summit declared that the European Union was to be the most dynamic and competitive knowledge-based economy in the world. Is the Council prepared to give a lead by championing the biotech industry with a faster rate of field trials and product approvals by the Member States?

Moscovici
I fear that you are taking us into a fundamental debate which we do not have time to go into here and now. I believe we must assess both the scope and the limitations of any scientific progress.

Rübig
Mr President, this debate is already overdue because the BSE crisis has huge implications for feedingstuffs, both home-grown and imported. We currently have a ban on animal and bone meal, which is why we need to find a clear position here. It is because of the BSE crisis that we are pressed for time. When, do you think, we shall be able to say that we can supply 100% non-genetically modified feedingstuffs in Europe? Will this label be available shortly so that consumers can rely on there being a supply of 100% non-genetically modified feedingstuffs?

Moscovici
I must answer the honourable Member in the same way that I answered the previous questioner. This is a debate which needs to take place, but I think that Question Time is not the right place for it.

Purvis
This is quite unsatisfactory. That is what Question Time is about! We have a question, we are entitled to ask a supplementary question and we certainly expect to have a proper response from the Council of Ministers. That is why we have come here. Mr President, I hope you will remonstrate with the Council.

Moscovici
I should at least like to respond to the honourable Member' s lack of satisfaction, so that these remarks may be entered in the Minutes, as I cannot allow him to get away with saying something as unfair as that. We are involved in a highly regimented procedure here: the Council is required to give answers to a great many extremely specific questions in a very short period of time and there is, I believe, no one here who would claim to be able to expand upon extremely complex social issues in just one minute. It would be both unwise and foolish for the Council to attempt to do so. I am therefore perfectly willing to propose that such a debate be held, on condition that the most appropriate forum is chosen. I feel that it would be irresponsible of me to give impromptu answers regarding GMOs in only a minute, and that would not be in keeping with the policy of this presidency.

President


Bernd Posselt
Question No 2 by (H-0871/00):
Subject: Situation in Chechnya How does the Council assess the present situation in Chechnya, and what efforts has it made in the last six months to try to stop the bloodshed?

Moscovici
The Council continues to be deeply concerned by the situation in Chechnya, where violence continues and the humanitarian situation continues to be very worrying at the onset of winter. For the moment there are no signs of a political settlement to the conflict. The Council has expressed its concern at many meetings with Russia at all levels, particularly seeking to induce Russia to avoid the excessive use of force and to avoid any extension of the conflict, to carry out independent and efficient inquiries into human rights violations, to support the OSCE Assistance Group in fulfilling its mission and, finally, to ensure that humanitarian aid is distributed properly. In particular, the Council has pointed out that only a political solution could bring this crisis to an end.
At the last EU-Russian Summit on 30 October 2000 in Paris, the matter was raised by both presidents. Mr Putin agreed that there was an urgent need to find a solution of this kind. For the first time, Russia accepted wording to this effect in the joint declaration issued following the summit. In this context, while remaining resolutely opposed to talks with what he refers to as "terrorists" , Mr Putin has indicated the need to distinguish between terrorists and those who have fought in good faith for Chechen independence. Indeed, Mr Putin has stated that the Assistance Group may in the near future return to Chechnya. I would point out that this has not yet come about.

Posselt
Mr President, two brief supplementary questions. First: did the Council contact President Maskhadov, who was democratically elected under the supervision of the OSCE, and other forces of democracy in Chechnya in a bid to find a peaceful solution?
Secondly: has the Council obtained information from the Council of Europe's Commissioner for Human Rights, who is well represented locally?

Moscovici
I do not have information exact enough to enable me to answer your supplementary question. All I can say is that we shall continue to liase closely with the Commissioner for Human Rights.

Dupuis
Mr President-in-Office of the Council, we in Parliament have tried in vain to urge Mr Nielson, the Commissioner responsible for humanitarian matters, to visit Chechnya, not just for the sake of an official visit but to carry out a serious survey of the humanitarian situation. We have not succeeded in convincing him. Could the French Presidency take the baton from us and contact Mr Nielson, urging him to go to Chechnya in the near future?

Moscovici
The Commission will, naturally, be informed of the content of our debates.

Rübig
Mr President, a point of order: it is standard practice in the House for questions which cannot be adequately answered orally to be submitted in writing. I would ask the President-in-Office to at least answer our questions in writing if he cannot do so orally.

President
As you know, we are studying ways of reorganising our work. One of the points covered by the document presented by Vice-President Provan is the form to be taken by Question Time to the Council and the Commission. Effectively, we have noted that Council, Commission and Members of Parliament have all been somewhat dissatisfied on several occasions. Therefore, if the Council so wishes, it can reply in writing, as you request. However, it must be borne in mind that it is, in effect, sometimes impossible, sometimes difficult and rarely a simple matter to reply to supplementary questions.

Posselt
Mr President, I just wanted to say that it was standard practice under the other presidencies to give a precise answer to a supplementary question. The President-in-Office must know if he met Mr Maskhadov or not. How can he say he does not have any precise information?

Moscovici
I would like to state that I am in complete agreement with what the chairman said just now. This Question Time is clearly not satisfactory. I have attended the European Parliament on many occasions and have been involved in all sorts of very interesting procedures. This is not one of them. You can see for yourselves that the Chamber is far from full. There are perhaps a dozen people here. I say that this is not satisfactory either for the Council or for Parliament. Please do not get agitated.
(Interruption by Mr Posselt)
Please, that is enough; this is really a trivial issue. I am simply trying to present a procedural issue. Indeed this is something about which I have written to your President, Nicole Fontaine, and she agrees with me.
I feel that the procedure must be reformed in a quite simple way to enable Members of Parliament to receive more specific answers on subjects which must be better organised. The Council Presidency, sir, is not a government or a single person, but a country working together with the departments of the general secretariat of the Council, and here we give you the precise answers which we have to precise questions.
If you are going to indulge in filibustering, then it is going to take hours. The procedure must therefore be amended or reformed. This is something I must stress and, sir, it has nothing to do with totally misplaced value judgements.

President


Giorgio Lisi
Question No 3 by (H-0876/00):
Subject: Council's position on the problems linked with alcohol shipments subject to excise duty This serious issue is a problem in many Member States (Belgium, the United Kingdom, Denmark, Germany, the Netherlands and Italy). Is the Council aware of this, of the costs involved for companies which ship alcohol and of the very high risk of fraud and smuggling?
What improvements does the Council intend to make to the basic directive, 92/12/EEC, to ensure that the shipper' s and recipient' s responsibilities are precisely apportioned, precluding any possibility of fraud?
What is the Council' s opinion of the possibility of eliminating this serious problem through computerised monitoring operated by customs authorities in the dispatching country and in the country of arrival or transit? Could this possible solution be put into practice very rapidly, in view of the fact that the Commission has shown particular interest in solving the problem through proposals and high-level groups, and is clearly ready to take firm action in this area?

Moscovici
The Council would remind the honourable Member of the conclusions adopted at the Council meeting of 19 May 1998 regarding fraud in the alcohol and tobacco industries. On that occasion, it stressed the need for Members States and the Commission to tackle fraud in the area of excise duty on alcohol and tobacco. It also approved the summary of the report from the high-level group on fraud in the alcohol and tobacco sector. Finally, it stressed the importance, subject to the results of a feasibility study proposed by the Commission, of a computer-based monitoring system as a long-term objective.
The Council also undertook to make provision, in the meantime, for the immediate implementation of an efficient selective early warning system. Since then, the Commission has worked to achieve this. The Council urges the honourable Member to address that institution on the subject directly, in order to ascertain the details of the above-mentioned measures and the state of progress in implementing them.

Lisi
Mr President, I think the question was quite specific. The Member in question, that is yours truly, did attempt to approach the Commission, which informally provided him with information regarding a situation which could be described as a deadlock.
This directive dates from 1992. The problem is well-known - common knowledge in fact - and it is part of the more serious issue of tax evasion, to which we are all extremely sensitive, but it is also extremely damaging to the firms which have no way of coordinating or monitoring it at all.
This is why I have had to approach the Council. I now take note of the fact that you have spoken of an undertaking. As a supplementary question, I would like to ask whether you are in any way able to forecast your action, seeing as the Commission appears to be ready and willing whereas, if I am not mistaken, there seems to be some reticence or disagreement within the Council. I would be extremely happy if you could dispel this doubt, for I am sure that all will then proceed very quickly.

Moscovici
I can give you the Council position, which is that, in general, the current situation regarding fraud in the area of both indirect and direct taxes and the possibility of stepping up administrative cooperation in these areas were discussed quite recently at the Ecofin Council meeting of 5 June 2000.
On this occasion, a report from an ad hoc group on combating tax fraud commissioned by Coreper on 8 September 1999 was referred to the Council. This report shows, as you quite rightly state, that tax fraud within the Community has reached worrying levels. All the Member States have confirmed their determination to intensify the fight against fraud both internally and in their relations with others. The Council has asked the Commission to present at the earliest possible opportunity proposals based on all the recommendations which met with unanimous agreement in the course of the work of the ad hoc group. This also refers to measures which might be undertaken in order to solve the specific problems of excise fraud.
This is the context in which I informed you that, without my being aware of any particular disagreement, the Commission has worked to this end and I think you might therefore safely ask questions of the Commission without fear of any divergence of opinions with the Council.

Maes
Are you under the impression that the Member States now have the means to achieve the objectives? I tend to feel that we need to put a lot more Community power behind the fight against fraud, and I think that the coordination between the Member States has failed to come up with the goods so far. Will the new measures do the trick?

Moscovici
You are right, the fight against fraud is never sufficiently well developed. As you know, over the years we have set up various instruments which are starting to work, but I quite agree that this is a fight which we must wage ceaselessly. This is what we should be striving for.

President


Jonas Sjöstedt
Question No 4 by (H-0881/00):
Subject: Increased carrier's liability The French Presidency has proposed in Council that carrier's liability be increased. This would mean that a carrier, for example an airline, would be penalised if it brought persons without valid visa or identity papers into the EU. In many Member States carrier's liability requires the carrier to arrange or pay for immediate return of the persons concerned, combined in some countries with fines. The Presidency now wishes to introduce mandatory fines. Carrier's liability is an effective method of preventing asylum seekers from reaching the EU. Many refugees with grounds for seeking asylum cannot obtain the passports or visas required for entry into the EU. Carrier's liability means that their requests for asylum cannot be examined in the EU. Instead they are dealt with by airline, airport and other transport staff. Does the Council consider that the latter are competent in practice to decide the future of asylum seekers?

Moscovici
The proposal the honourable Member refers to is an initiative from the French Presidency with a view to the adoption of a Council directive on the harmonisation of financial penalties imposed on carriers transporting third country nationals to Member States' territory without the necessary documents for entry.
This text, which was presented to the European Parliament for consultation on 6 September 2000, is currently being examined by the competent Council bodies. The aim of this initiative is to implement a European-wide coherent policy against illegal immigration and the trafficking of human beings, which is a real scourge.
Increasing carrier liability is one of the essential aspects of this. Moreover the proposed directive introduces a minimum instrument common to all Member States regarding carrier liability, setting requirements for checks to be carried out by carriers and harmonising the penalties currently laid down by Member States. It is not a matter of establishing new penalties against carriers but rather of harmonising those already provided for under the terms of the Schengen Convention.
I should like to draw the honourable Member' s attention to the fact that recital 3 of the draft directive does indeed stipulate that application thereof shall not be prejudicial to the commitments arising under the Geneva Convention of 28 July 1951 relating to the Status of Refugees, as amended by the New York Protocol of 31 January 1967. The European Union has, on many occasions, stated its absolute respect for the right of asylum. This has to be reconciled with effective action to combat illegal immigration and the trafficking of human beings. This is imperative and is something that was explicitly called for at the Feira European Council following the tragic events in Dover.

Sjöstedt
Mr President, I want to thank the French minister for his answer. I nonetheless believe that the proposal tabled by the French Presidency is completely unacceptable and that it really has only one aim, namely to keep asylum seekers out of the EU, something which may in practice lead to an increase in illegal immigration.
It is also the case that it is not only refugees under the Geneva Convention who may be granted asylum but also significantly larger groups. These groups are obviously not excluded under the new proposal.
I also asked a specific question concerning the powers of airline and airport employees to make actual decisions on asylum matters. If it is true that those who are regarded as refugees under the Geneva Convention are to be excluded, what actual powers do check-in staff at an airport in Istanbul possess to decide a refugee' s fate, for that is what this issue is about. I think it is a very relevant question because the fate of refugees is being placed in the hands of, for example, airline and airport staff. In my opinion, such staff are not competent and are lacking in training in this area, and it is therefore basically irresponsible to give them this power.

Moscovici
That is more a statement of opinion than a question. I would repeat that we are bound to take effective action against this scourge which has given rise to tragic events, and we must do so while ensuring that the European Union continues to respect the right of asylum entirely. Let me stress that: absolute respect. Individual countries may have problems. We are working on that. It is up to that country to voice its concerns. This is, however, I believe, the road we must take.

Sacrédeus
Thank you for your answer. I should like to ask the following supplementary question. How major and extensive does the Council consider this problem to be, and how seriously does the Council view the fact that transport companies organise travel to the EU for persons without valid visa and identity papers?

Moscovici
That is precisely the question which I was attempting to answer. Let me repeat that it is a subject of the utmost, the very utmost gravity.

President


William Francis Newton Dunn
Question No 5 by (H-0882/00):
Subject: Everything but arms proposal Is the Council content that this proposal from the Commission - which may well have dire consequences for already hard-pressed sugar beet farmers in the European Union - should be passed without any consultation of the directly-elected European Parliament?

Moscovici
The proposal for a Council regulation amending Council Regulation (EC) 2820/98 so as to extend duty-free access without any quantitative restrictions to products originating in the least-developed countries, which the Commission put forward recently, is the result of Community initiatives to improve market access for the least developed countries.
In this respect, the ACP-EC partnership agreement signed in Cotonou in June 2000 stipulates that the European Community shall by 2005, at the latest, allow duty free access for essentially all products from all LDCs.
In view of the ongoing reform of the common organisation of the market in sugar, rice and bananas, the Commission proposal stipulates that market access for such countries will be gradually liberalised over a period of three years from January 2001. The proposal provides for granting products from LDCs duty free access, amending the generalised tariff preference scheme currently implemented by the Community. Insofar as this proposal relates to common trade policy, it is covered by Article 133 of the Treaty, which does not call for the European Parliament to be consulted.
I can assure you, nonetheless, that the Council is examining this proposal with a great deal of interest, and is in particular looking into the potential implications for Community producers of the proposed duty free access and into whether this proposal is consistent with ongoing plans to reform the common organisation of the market in certain industries such as sugar, for example.

Newton Dunn
Last month when I asked a supplementary question in Question Time, this President-in-Office simply avoided giving me a supplementary by saying: "I can only repeat my previous answer" and reading out the previous answer again. This time I will give him a chance not to read out the previous answer but ask him for an undertaking and an agreement. Does the President-in-Office agree that there should be no decision made on this proposal until there has been a full impact assessment of the effect on the Union, the ACP countries and the LDC countries? Yes or no?

Moscovici
The Presidency and a number of Member States have already received various letters from the Comité européen des fabricants de sucre (European Committee of Sugar Manufacturers) regarding the Commission' s proposals, which they will take into account in their deliberations. The real impact of the duty free access proposed for European producers will be a key factor in the Council' s final decision.

Clegg
I should like to repeat a question which I asked Mr Moscovici last week in plenary. Perhaps he had too many questions to deal with to be able to answer me then.
Perhaps you could answer me in these more intimate surroundings this evening. It is about the role of the European Parliament's in-trade policy, which is the spirit of Mr Newton Dunn's question. Do you think that it will be possible for you, me or anybody in Europe to advocate greater transparency and accountability in the WTO in-trade policy as long as this place has no formal and serious role in scrutinising and vetting trade policy decisions taken by the Council of Ministers and the European Commission?
To cite my dear friend, Mr Newton Dunn, perhaps the best way to answer this is: yes or no.

Moscovici
I should just like to make you see, on this, my last visit here, what the point of this exercise actually is. The Presidency is not here to express the opinions of any given individual or any given government but rather to state what the position of the Council is at any moment 'x' or time 't' . So, while I may have my own personal opinions as a political leader - and I do have opinions on the subject, believe me - I shall confine myself to expressing the Council' s current position.

Kinnock
You mentioned the Cotonou Agreement. Are you aware that the Cotonou Agreement also expresses a commitment to undertaking impact studies which might affect non-LDC countries as well as to have consultation? Neither of those two things has happened. It is not good enough to have consultation after the events. Are you aware that apart from sugar producers in Europe, concerns are being expressed, especially by countries that are commodity-dependent - particularly in the Caribbean - on sugar, bananas and rice, as you have mentioned?

Moscovici
I can assure all the Members of the European Parliament who have asked me questions that the Council will take their comments into consideration.

President
 As they deal with the same subject, the following two questions will be taken together:

María Izquierdo Rojo
Question No 6 by (H-0886/00):
Subject: Measures for the prevention of mad cow disease Has the Council looked into the possibility of a temporary blanket ban on the use of meat and bone meal, with a view to preventing the spread of mad cow disease? What measures will it be proposing in the immediate future for those countries which have been declared high-risk?
and

Efstratios Korakas
Question No 7 by (H-0932/00):
Subject: Immediate danger from bovine spongiform encephalopathy The continuing cases of 'mad cow' disease have made consumers, as well as livestock producers, extremely worried. The decisions taken by the recent Agriculture Council enraged the citizens of the Member States, whose health is being jeopardised by continuing consumption of meat that is unfit to eat.
When does the Council intend to take effective measures to protect consumer health by changing organisational methods and development conditions for livestock rearing, through the use of livestock feed containing protein of plant origin, such as legumes, through radical reform of the CAP, a ban on beef exports from France and any other countries where a similar problem appears, universal inspection of cattle and a ban on the production and use of meat meals for feeding ruminants?

Moscovici
The Council wishes to point out that its policy is always to afford consumers the highest possible level of protection. In particular it has sought, by means of its recent decisions, to ensure that the meat available to consumers is guaranteed to the maximum in this respect, especially by means of its decision with a view to guaranteeing the improved traceability of the origin of meat and elimination from the food chain of a list of specified at-risk materials, which now includes bovine intestines.
As a precautionary measure and in order to eliminate risks of cross-contamination, the Council has decided to suspend, as of 1 January 2001, the use of meat meals in feedingstuffs for production animals. Finally, non-tested animals aged above thirty months may no longer enter the food chain. A purchase and destruction system is to be set up for such non-tested bovine animals, in order to compensate livestock farmers at the market price. The Council considers that this package of measures should make it possible to avoid the risk which the honourable Members have decried.
Regarding the method of organisation and the criteria for the development of livestock farming, the Council would point out that, in the context of its decisions taken under the Agenda 2000 reform, emphasis has been placed on greater incentives for extensive production, particularly by means of bonuses. Furthermore, on 4 December 2000, the Council noted the Commission statements on the cultivation of protein-rich crops and called upon this institution to look more deeply into this matter in the near future and to draw conclusions with reference to current policy in this sector and with regard to set-aside, including, if necessary, by presenting appropriate proposals.
The Council' s objective in all these decisions is to restore consumer confidence within the European Union. However, in consideration of the need to uphold the principles governing the internal market, it aims to favour Community-wide measures over measures concerning specific Member States.

Izquierdo Rojo
First of all I have to say that, in my opinion, the President-in-Office of the Council has not yet answered Mr Korakas' question.
Secondly, and with regard to my specific question, I thank the President-in-Office of the Council very much for his answer. I think that the Council has been bold and has been quick to take some important measures. However, we are faced with the very serious problem of the failure to comply with the measures agreed. The Council knows that in 1989, both the production of feed with animal proteins for feeding ruminants in the United Kingdom and for the production of meat meals were banned. This indicates that the measures that we adopted at the time were good and have guarantees. But our problem is that they are not applied, that there is fraud in fulfilling them. I would therefore like to ask the President-in-Office of the Council if the Council of Ministers is going to give guarantees that the Community rules will be complied with, if it is going to give guarantees that the existing measures banning meat meals are going to be complied with. Which inspectors are going to deal with it? What checks are going to be made? Is this a concern that has been latent in the Council of Ministers? Answer me please, specifically: what food safety guarantees are going to be given that all these measures are to be applied?

Moscovici
Mrs Izquierdo Rojo, I have outlined the decisions that the Council has taken. As you yourself stated, these are bold decisions of recent date, the latest of these being from 4 December, that is a week ago. The French Presidency has, from the very outset, been concerned to bring about a European response to this crisis, which is a crisis in terms of foodstuffs, society and health. Right up to the end, the presidency has stressed and urged that measures be taken, and you may be sure that when France resumes its position as a simple member of the European Union at the end of the presidency, it will continue to stress that this must be done. At any event there is now, I believe, a general increase in awareness throughout Europe which will enable whatever measures necessary to be taken in order to combat this disease.

Maes
I wanted to ask if there has been an evaluation of the measures that have been taken. I tend to feel that if drastic measures had been taken earlier, we would not be facing such a disastrous situation now. Is that how the Council sees it?

Moscovici
As you know, we continually act according to the latest state of our knowledge, and so I cannot completely endorse this analysis. I believe, moreover, that we should improve our knowledge, and that is also the point of establishing a European food safety authority, on which the Nice European Council took a decision in principle at last week' s meeting. This authority must now be set up, and I think the European authorities have now become very aware of the issue, and that we must forge ahead.

President
 Mrs Maes, I am told - for none of us knows the Rules of Procedures off by heart - that you were not entitled to ask this second question because the Members are only entitled to ask one supplementary question during Question Time.
As the author is not present, Question No 8 by Mrs McKenna lapses.

Lucas
My understanding is that the services were told two days ago that I would be taking over the question for Mrs McKenna because we knew then that she would have to go back to Dublin on urgent business.

President
I have not been informed of this by any of the assistants and I cannot accept the proposal made now.
Question No 9 by Olivier Dupuis (H-0890/00):
Subject: Algerian ban on WAFA party
The international press reports that the Algerian Minister for Internal Affairs, Mr Yazid Zerhouni, refuses - in violation of the procedures provided in law for setting up political associations and parties - to recognise the WAFA party led by the former minister, Ahmed Taleb, which has been set up in full compliance with current legislation. This party, which aims to reconcile Islam and the modern world and which could make a significant contribution towards reviving the country's ailing democracy and, therefore, strengthening the rule of law, finds itself subjected to a ban on the well-worn pretext that it would represent 'a threat to State security'.
What initiatives has the Council taken, or will it take, to persuade the Algerian authorities to respect their own laws and thereby also promote the revival of democratic debate and the political process, thus enabling Algeria to emerge from the serious crisis in which it finds itself?

Moscovici
Under the Barcelona process, Algeria endorsed a number of principles including respect for the rule of law. The Presidency Conclusions adopted at the end of the fourth Euro-Mediterranean Conference in Marseilles on 15 and 16 November 2000 explicitly mention the need to boost political dialogue among the 27 members, including at ministerial level, particularly on the following subjects: the process of consolidating the rule of law and respect for human rights and democratic principles.
The bilateral political dialogue which the European Union is conducting with Algeria does indeed focus on the objectives you stressed in your question, i.e. restoring debate and a democratic political dynamic. In fact, three years ago, the European Union initiated this kind of political dialogue at ministerial level on the basis of specific guidelines: firstly, condemnation of violence and terrorism, solidarity with the Algerian people, the need for the Algerian authorities to undertake political and economic reforms, the need for dialogue between the government and the opposition, the European Union' s goodwill with regard to developing relations and cooperation with Algeria, and, finally, the wish to see an open comprehensive political process implemented in Algeria.
These are the initiatives which the Council has taken or intends to take with regard to the Algerian authorities. I can assure you that the European Union intends to continue and step up its political dialogue with the Algerian authorities, especially involving the ministerial troika.

Dupuis
Has the Presidency representative, in this instance the French Ambassador to Algeria, actually met Mr Ahmed Taleb? Have either the French Ambassador or other Council leaders initiated talks with the Algerian authorities in order to ascertain how they might get around this situation?

Moscovici
According to the information I have, I just wish to state that the European Union did indeed initiate political dialogue at ministerial level in 1997 and that, in principle, the French Presidency is to have a meeting between the troika of ministers and Algeria, but as yet no date has been set. As far as I know, the Council has never so far discussed the matter of refusal to recognise the WAFA party or issued any statement. I am told that it was noted within the working party that this measure indicated a power struggle within the Algerian administration. As you can see, I do not have any inside information or, unfortunately, any more specific information. I, or rather the Council, will answer your second question in writing.

President


Glenys Kinnock
Question No 10 by (H-0892/00):
Subject: UN special session on children The UN General Assembly's Special Session on Children, in September 2001, will discuss the situation of children world-wide, and consider adopting a new plan of action to make children's rights a reality across the world.
Would the Council outline its policy priorities for the UN General Assembly Special Session on Children? Does the Council intend to consult widely with civil society organisations, as requested by the UN Secretary-General, in the setting of its future policy priorities for children, both within the European Union and in the developing world?

Moscovici
. (FR) I have already had the opportunity, a few weeks ago, to express my comments to you on the preparations for the UN General Assembly Special Session devoted to reviewing the results of the World Summit for Children which is to take place in September 2001. At that time I stressed the importance of preparing thoroughly for this event and the truly fundamental role which the European Union should play in these preparations.
Consequently, on 20 November 2000 last, on the anniversary of the adoption of the Convention on the Rights of the Child, the ministers of the Members States with responsibility for matters relating to children and a Commission representative met in Paris and adopted shared commitments which will contribute to enhancing European Union action in making preparations for this special session.
I should like to answer your first question and inform you of the political priorities we identified as part of our preparations. The chief objective of the special session will be to renew the international community' s commitments to children' s rights and children' s welfare. To this end, an assessment of the last ten years must be made with regard to the commitments and objectives set at the World Summit. The commitments expressed in the Millennium Declaration, which complement the World Summit, should also be taken fully into account. These commitments concern access to education, reducing maternal mortality and under-five child mortality, and combating transmissible diseases, especially AIDS.
As regards your second question, the Council is in complete agreement with the point of view of the General Secretary of the United Nations that all the institutions concerned and also experts, research bodies or academic institutions which have a special interest in children' s issues should be involved in this exercise.
The involvement of non-governmental organisations in the preparatory process and in the special session would seem to us to be a basic condition to making this meeting a real success.
We welcome the arrangements proposed in this respect by the Preparatory Committee and adopted by the General Assembly regarding procedures for the registration of non-governmental organisations for involvement in the preparatory process and the Special Session in September 2001. We are in constant liaison with the representatives of the non-governmental organisations, including by means of seminars. In the course of such exchanges, we have benefited from their experience and their commitment to children.

Kinnock
We can congratulate the French presidency on taking this initiative to prepare for the UN special session. You obviously have made a commitment to involving civil society. Will you also make a commitment to actually consulting children, since the events involve them? I hope that their views will also be sought in the months ahead.
Secondly, it is also the case that while many Member States are very active on the issue of children's rights it is actually much more difficult in a European Union context to be as proactive. What progress do you think we might make in securing a legal base for the European Union's work with children and the promotion of children's rights?

Moscovici
. (FR) Indeed, Mrs Kinnock, Sweden is also going to organise a conference on refugee children in Stockholm in the spring of 2001.

President


Alexandros Alavanos
Question No 11 by (H-0894/00):
Subject: Turkey's obligations under EU-Turkey partnership arrangements In its proposal regarding partnership arrangements between the EU and Turkey, the Commission indicates that the European Council is to re-examine the situation regarding unresolved differences, particularly with regard to their impact on accession procedures, so as to help ensure that they can be resolved within the International Court of Justice before the end of 2004 at the latest. In its own resolution (A5-0297/2000, Minutes of European Parliament Sittings of 15 November 2000), the European Parliament also points out that the judgment of the European Court of Human Rights in 'Loïzidou v Turkey' (No. 15318/89) has not yet been implemented and calls on the Turkish Government to comply with the decisions of the European Court of Human Rights. Does the Council intend to include in provisions regarding partnership arrangements stipulations regarding acceptance by Turkey of the jurisdiction of the International Court of Justice at the Hague and compliance by Turkey with the decisions of the European Court of Human Rights, in accordance with the unanimous wishes of the Council of Europe?

Moscovici
Yes, political agreement was reached within the General Affairs Council regarding the text of the accession partnership agreement for Turkey and on the framework regulation which defines its principles and conditions. The Presidency is very pleased with this result, which marks a significant stage in the implementation of the pre-accession strategy for Turkey defined last year in Helsinki.
The Council has not radically changed the initial Commission proposal as adopted by the Commission on 8 November 2000. There have just been some amendments to the priorities relating to political criteria and to reinforced political dialogue.
Regarding the reference to the jurisdiction of the European Court of Human Rights, there has been no change to the Commission proposal. The partnership agreement contains a number of references to the European Convention on Human Rights. In addition, it stresses the need to enhance the legal avenues for remedying human rights violations.
It moreover stresses the importance it attaches to improving the judicial apparatus and the training of Turkish magistrates, particularly in the field of human rights.
Regarding the peaceful settlement of disputes, the text of the accession partnership agreement points out, in accordance with the conclusions of the Helsinki European Council, that this issue is an important matter, to be dealt with in the context of the political dialogue between the European Union and Turkey.
Like the other candidate countries, Turkey must make every effort to resolve any outstanding border disputes.

Alavanos
I thank the Minister for his reply. This question was submitted while the issue of the partnership was still pending. I appreciate how tiring the past days must have been and I shall therefore focus my second question on the subject of the Loïzidou case, i.e. the judgment against Turkey by the Court of Human Rights in Strasbourg in the matter of the seizure of the property of Greek Cypriots in the occupied section of the island. The Loïzidou case has already given rise to two judgements against Turkey. Does the Council intend to discuss this issue with the Turkish Government within the context of this partnership which you have referred to?

Moscovici
. (FR) I have quite simply pointed out, Mr Alavanos, the general and specific conditions under which this accession partnership agreement was adopted. This is the context in which negotiations with the candidate country will be going ahead. We have accepted its candidacy and now we have specific requirements and expectations of that country.

President
 As the author is not present, Question No 12 by Mrs Karamanou lapses.

Neil MacCormick
Question No 13 by (H-0897/00):
Subject: Fundamental rights and justice With reference to Mr Moscovici' s answer to my question and supplementary question of 14 November (H-0854/00), it remains entirely obscure why the Council thinks that the implementation of the principle of mutual recognition of judgments will in itself do anything to secure due fulfilment of the guarantees contained in Articles 5 and 6 of the European Convention on Human Rights, now repeated in Articles 48 and 49 of the Charter.
I refer to guarantees such as the right to defend oneself in person or through legal assistance of one' s own choosing or, if one has not sufficient means to pay for legal assistance, to be given it free when the interests of justice so require; to have the free assistance of an interpreter if one cannot understand or speak the language used in court; right to trial within a reasonable time, or to release pending trial.
With regard to individual cases such as those mentioned in my supplementary question, how can the Council claim that a process of mutual recognition will of itself make any improvement at all?

Moscovici
. (FR) As the Council has emphasised to the honourable Member in the previous answer, the process of the mutual recognition of judgements will afford better protection of individuals' rights. The mutual recognition of judgements will in fact make it possible to better guarantee personal security as it will facilitate the fight against crime on European Union territory by improving judicial cooperation. In the long term, the conduct of inquiries and the prosecution of offences will cease to suffer from the limitations due to the diversity of national legal systems.
Next, mutual recognition affords improved legal safety within the European Union in that as it ensures that a judgement pronounced in one State will not be called into question in another Member State. This is application of the non bis in idem principle: the same case may not be retried, final judgements cannot be called into question. This is a very important aspect of the protection of individuals.

MacCormick
It seems to me, with great respect, President, that the Council has yet again failed or refused to address the particular problem which I asked it to address. Last time Council might have claimed it lacked notice of that question. This time I put essentially the same point for the second time in one month and hope for some kind of an answer. Citizens of this Union are detained pending trial for totally unacceptable periods of time, their detention is extended and extended. This occurs particularly in Longuenesse jail in France and applies to truck drivers from the United Kingdom and other countries. I find it wholly unacceptable that this problem should be simply swept under the carpet, and we are assured that the mutual recognition of judgments will help in some way. I want to know why this question, this very plain and simple question, is not being answered. Are the rights of defence being adequately honoured and will mutual recognition do anything to help?

Moscovici
Let me give you the Council' s interpretation of your question, and its answer. Regarding the specific cases you mentioned, mutual recognition will not lead to validation of a judgement which flouts essential rights such as the right to legal representation of one' s own choice or the right to the free assistance of an interpreter. On the one hand, these are rights which all the States have endorsed and which constitute the shared foundation of our criminal justice systems, and, on the other hand, mutual recognition is a process which is by no means automatic and which depends on the nature of the judgement in question. So, as the Council stated in its previous answer, the programme for mutual recognition can only bring improvements in terms of fundamental rights.

Lucas
Mr President, I have to say that the President-in-Office is turning not answering questions into something of an art form. I would like to press him further. What will the Council do to ensure that the states do the kinds of things he has just been setting out? What guarantee do we have, that the theory that you have just stated will actually take place?

Moscovici
I have no further information to give you. I think we simply have a little misunderstanding here. What I am in fact trying to explain to you is that the Council is indeed taking action to meet your expectations.

President


Esko Olavi Seppänen
Question No 14 by (H-0899/00):
Subject: Mandate of the Rapid Reaction Force An EU rapid reaction force is currently being set up. What has been decided about the mandate on the basis of which these troops will be deployed, and for what purposes will they be deployed?

Moscovici
It is up to the Council to decide upon the possible launch of a military operation conducted by the European Union as part of the Petersberg assignment. In accordance with Article 23 of the Treaty on European Union, the Council shall adopt this decision unanimously, as is the case, moreover, for any other decision with implications in the area of defence.
It is, furthermore, up to each Member State to take a sovereign decision at national level whether or not to commit their national forces to the operation. The Nice European Council recorded the conditions which might lead the Council to take a decision in a crisis situation. According to these, with a view to setting up an operation, the Political and Security Committee (COPS) may submit a recommendation to the Council on the basis of advice from the Military Committee. The Council, whose deliberations are prepared by COREPER according to the customary procedures, may take a decision on the basis of this. The decision to launch an operation would, in principle, take the form of a joint action. The COPS, as the kingpin of European security and defence policy and the CFSP, has a central role in defining the European Union' s response to a crisis. In particular, it provides the political scrutiny and strategic administration of a military crisis management operation. The option of deploying a rapid reaction force exists for the whole range of crisis management missions, the Petersberg missions as defined in Article 17(2) of the Treaty on European Union, humanitarian and evacuation missions, peacekeeping missions and combat troop missions for crisis management, including peacemaking missions.

Seppänen
Mr President, Minister, I would like to ask if any decisions of principle have been taken regarding whether there should be a mandate from the UN or any other international organisation in discharging such tasks as these, as, under international law, a mandate from an international organisation is needed before any country' s territory can legally be attacked in this way. Furthermore, I would ask what sort of legal definition has been presented or made in the Council regarding tasks connected with the deployment of crisis management troops?

Moscovici
There is a report available which was appended to the Presidency' s report at the Nice European Council on European security and defence policy. This will give Mr Seppänen all the answers he requires. It is a rather long document, but all the information is laid out there in precise detail.

President
 As the authors are not present, Questions Nos 15 to 21 lapse.

Lennart Sacrédeus
Question No 22 by (H-0918/00):
Subject: Bearing of taxes on the operation of the internal market In an article in the Financial Times in November this year, the Commission President, Mr Prodi, affirmed that he does not want to see tax harmonisation and common tax levels in the EU by stating that tax rates 'are in the hands of the national parliaments and must remain so'. At the same time, in the same article, he considers that, in order for the EU to become dynamic and competitive, there is a need to switch to majority voting on taxes 'where necessary for the internal market to function'.
Which taxes does the Council consider to have no bearing on the dynamic and competitive operation of the internal market?

Moscovici
With your permission, Mr President, that will be the last question that I shall be able to answer during this Question Time.
The honourable Member' s question concerns the unofficial opinions expressed by the Commission President. It is not therefore up to the Council to state an opinion on this matter. I should just like to point out that the Treaty system differentiates between taxes and indirect taxes which must be harmonised in order to ensure the proper establishment and smooth running of the internal market - according to Article 93 - and the approximation, laid down in Article 94, of legislation which has a direct bearing on the establishment or running of the common market, including legislation on direct taxation. The decisions taken by the Council on the basis of Articles 93 and 94 were taken according to the rule of unanimity. Following the Treaty of Nice they will, unfortunately, continue to be taken according to the rule of unanimity.

Sacrédeus
I should like to thank the French presidency for its answer. I nonetheless want to ask whether the Council welcomes this type of very contradictory and unclear statement from the Commission' s President. It is nevertheless the case that, if the desire is to create close cooperation between the Council, Parliament and the Commission, it is unfortunate if the Commission' s President produces vague statements of this kind, for his statement can only be interpreted in terms of his wanting to open the way to tax harmonisation despite creating a smokescreen for this.

Moscovici
I must repeat that I cannot comment on statements attributed to the President of the Commission. However, the matter of whether decisions on taxation should be taken by majority vote was examined in the context of the Intergovernmental Conference. As you know, it was not possible, unfortunately, to make any progress in this area at Nice.

President
 Question Nos 23 to 32 will be answered in writing.
That concludes Question Time.
(The sitting was suspended at 7 p.m. and resumed at 9 p.m.)

Stabilisation and Association Agreement with the Republic of Croatia
President
The next item is the report (A5-0364/2000) by Mr Baltas, on behalf of the Committee on Foreign Affairs, Human Rights, Common Security and Defence Policy, on the Commission report on the feasibility of negotiating a Stabilisation and Association Agreement with the Republic of Croatia [COM(2000) 311 - C5-0506/2000 - 2000/2244(COS)]

Baltas
Mr President, I have great pleasure in presenting the report on the Stabilisation and Association Agreement between Croatia and the European Union to this part session of the European Parliament. Croatia has made considerable progress in the economic, the political and the social sector and the Stabilisation and Association Agreement is the next logical step. Allow me briefly to summarise these three main sectors.
First, the economic sector. Obviously, huge efforts are still needed before the Croatian market functions in line with the acquis communautaire. However, efforts are clearly being made and the results of structural and economic reform can already be seen, especially in the transparent procedures being used for privatisation and the protection being offered to foreign investment. The Stability, or rather Stabilisation and Association Agreement, which provides for financial aid and general financial assistance through the relevant Community programmes, will strengthen this progress in the economic sector and speed up preparations for Croatia's accession to the European Union at a later date.
The progress made by Croatia is evident not only in the economic sector but also in the political sector. The new coalition voted in during recent elections in Croatia has decided to put its money on democracy and the rule of law. This embracing of democracy and the rule of law go beyond mere words to daily actions: institutions are being created and legislation - such as the legislation on protection for refugees, the right to asylum and immigration - is being reformed. Also worth mentioning here are the attempt by certain representatives of the Croat community in Bosnia to destabilise the government in order to recreate the wartime statelet of Herzeg-Bosna and the government's compliance with the terms of the Dayton agreement and collaboration with the International Criminal Tribunal for the former Yugoslavia.
Progress has clearly also been made in the social sector and at this point, I need do no more than read you an extract from the conclusions of the Council of Europe:
"Croatia has made significant progress in fulfilling its commitments as a member of the international community, in particular with its ratification of the European Convention on Human Rights, the European Convention for the Prevention of Torture and Inhuman or Degrading Treatment or Punishment, the Framework Convention for the Protection of National Minorities, the European Charter of Local Self-Government and the European Charter for Regional or Minority Languages."
With the changes and democratic developments in Yugoslavia, the Stabilisation and Association Agreement between the Former Yugoslav Republic of Macedonia and the European Union and the present motion for a resolution on the Stabilisation and Association Agreement with Croatia, there are good prospects for democratisation and stabilisation in the Western Balkans and Croatia can play a specific and decisive role here.
The Stabilisation and Association Agreement between the European Union and the Republic of Croatia has come along at just the right time. Parliament also has cause to congratulate itself on rushing approval through before the end of the year. Just how right it was is confirmed by the summit in Nice which ended just yesterday morning. The following is an extract from the chapter describing the Western Balkans:
"The Zagreb Summit of 24 November, which brought together for the first time countries in the region which had returned to democracy, welcomed the historic changes which have occurred in the Western Balkans, initially in Croatia and then in the FRY. ... It confirms that the process of stabilisation and association is at the heart of the Union' s policy vis-à-vis the five countries concerned, which each receive individual treatment."

Stenzel
Mr President, the report on the Stabilisation and Association Agreement takes account of the new democratic developments in Croatia and highlights the European prospects for this country, which has managed in the course of the past year to achieve its aim of joining the international community of states. Its membership of the NATO Partnership for Peace and of the World Trade Organisation, its bilateral agreements with the EFTA states, its free-trade agreements with the CEFTA member states and the negotiations that began recently, on 8 November, on a wide-ranging Stabilisation and Association Agreement with the European Union are all evidence that Croatia has embarked on a clear change of course since the elections of 3 January 2000.
The European Union emphasised this again by the summit held in Zagreb on 24 November. However, it also became clear at this summit that the situation inside Yugoslavia remains as brittle and strife-ridden as ever. If this pattern of behaviour continues, where in case of doubt each party fights the other, it could break up the Stability Pact for South-East Europe, which is based on regional cooperation. For even now states like Croatia are asking whether the obligation to cooperate on a regional basis might not end up delaying their own accession to Europe. Croatia, like a more democratic Serbia, where I hope that democracy will be consolidated on 23 December, could become major factors of stability in these regions destroyed by wars and ethnic conflicts. It is important for the European Union, as also the European Parliament, to do their utmost to provide economic protection and support for the democratic process in these countries. Even if they still have a long way to go before they can join the European Union, economic and political help quite simply offer the principle of hope, and Mr Baltas' report takes that principle into account.
But we should also apply the principle of differentiation in this region. Croatia has made significant progress, especially by ratifying the European Convention on Human Rights, the European Convention for the Prevention of Torture, the Framework Convention for the Protection of National Minorities and the European Charter for Regional or Minority Languages. The European Parliament's report rightly notes that. Another point in Croatia's favour is the changed attitude of the newly elected Croatian authorities to the International Criminal Tribunal for the former Yugoslavia.
Croatia has always felt part of western Europe, western culture. It needs all our support and encouragement along its chosen road to economic and political reform.

Swoboda
Mr President, Commissioner, ladies and gentlemen, first let me congratulate Mr Baltas very warmly on his report, in particular for the fact that he drafted it so quickly, for it was both important and correct to react quickly to the changes in Croatia as Mr Stenzel said. I also had very good talks with members of the former government. Some were very useful, but the whole thing always had to be seen in the context of extreme nationalism, of very sluggish cooperation with the International Criminal Tribunal and a very hesitant approach to Bosnia and Herzegovina. That has changed. The new Croatian government has not only recognised but actually supports Europe's Balkan policy. And that is why it was right to react quickly.
I can see no contradiction between the one-to-one relations between the European Union and Croatia and the various Balkan countries, and regional cooperation. We need regional cooperation. We need it, for example, with Bosnia and Herzegovina, and it is most welcome that the government has said it will support the idea of Bosnia and Herzegovina as a single state, which has not always brought it friends among the Croatians in Herzegovina. But that is a bold, clear and definite step and it must be followed up.
In the end we also need cooperation with Yugoslavia, meaning cooperation on both sides. On the one hand we must continue to insist that the ethnic Serbian refugees who have fled Croatia can return there, that this is not just the will of the government but can also be achieved against quite considerable local resistance in individual regions, villages and areas. But of course we also need cooperation with Yugoslavia not just for this process but also in order to stabilise the region. Even if we are being a little cautious and reticent at this point we and Mrs Pack is here too have told Mr Kostunica quite plainly that we must also require the new Yugoslavia, which we hope will emerge stronger from the elections on 23 December, to cooperate with the International Criminal Tribunal, to cooperate on a regional basis, to be prepared to resolve the conflicts peacefully.
My third and final comment is this. The Zagreb summit sent out a clear message. We in this Parliament have already incorporated the further developments clause in the agreement with Macedonia. Now, however, we must also prepare the way carefully. That makes the decision, or non-decision, of Nice rather disappointing: the complexity of the majority-voting system makes things difficult enough for the current round of enlargement, but they will become much more difficult when it comes to enlargement towards south-eastern Europe. Here the Union still has much work to do.

Schroedter
Mr President, ladies and gentlemen, we too can answer yes to the question whether Croatia deserves a Stability and Association Agreement. Croatia is increasingly becoming a factor of stability in the region. It is making positive progress towards democracy. However, let me emphasise that even though we welcome this progress, this does not mean we think Croatia has reached its goal. It must now take the next steps towards legislative reform, especially in relation to minority rights, freedom of the press and an independent judiciary. It is up to the Commission to take a very critical look at precisely these aspects now in preparation for the Stability and Association Agreement. Let me also stress that Croatia is endeavouring to put its relations with neighbouring states in good order. That means it really has made quite positive progress here.
It is particularly important to show Croatia that we regard it as quite crucial what role it takes on with regard to stabilisation in Bosnia and Herzegovina and the Federation there. Indeed, that is the precisely the yardstick by which we must measure Croatia's progress towards stabilisation.
I think it would be a disaster for the EU to tie economic support to an agreement on the return of the refugees in the Association and Stabilisation Agreement. That issue must be based on other conditions, namely whether access to asylum in Croatia is compatible with international standards and whether it is a humane access to asylum. I believe this question has to be treated separately and must not be part of the agreement.

Marset Campos
Mr President, our Group supports the work done by Mr Baltas on the report on the feasibility of negotiating stabilisation and association agreements with the Republic of Croatia. We also think that the Commission has acted at the appropriate time to launch this proposal.
We think that the work has been done in record time, and we congratulate Mr Baltas on his efficient work in committee.
We think that it is timely because, although at the time, we, as the European left, criticised some countries of Western Europe for their role in the break up of the former Yugoslavia, through encouraging, facilitating or instigating hatred and aggression, both ethnic and of other kinds, which resulted in the emergence of Croatia, at this time, when its recent past has also changed, I think it is a very good sign that the European Union is taking a step forward to help recover the mood of tolerance, democracy, respect for human rights and living in harmony with other republics and areas in the region, because it is of vital importance for the European Union.
We should not forget the suffering of the almost three hundred thousand people, of Serbian origin, who were violently expelled in a week, by terrorist methods, from Krajina, and had to flee to Serbia. I think it is important to recognise that it was wrong and that those people be helped to return, if they wish, to their homes. That would prove that tolerance, living together in harmony and respect for different opinions are possible in the Balkan region and it would improve the prospects for our future in the area.

Pack
Mr President, ladies and gentlemen, I particularly welcome the start of the negotiations on a Stabilisation and Association Agreement, which will at last open up the prospect that country deserves. Unlike its neighbour Slovenia, immediately after independence in 1991 Croatia was not able to develop in a way as to allow it to become a candidate for accession at this point. For at the time, in 1991, one third of the country was occupied. At the time the Croats were driven out. In 1991/92 more than 250 000 Croats were expelled from Kraijina, from western and eastern Slavonia. They were not able to return to their homes until the, to my mind, justified­ recapture of these areas. There they found their property and possessions in ruins. Unfortunately, during this recapture Serbs who had the right to live there were expelled in return, not just by the Croats but sadly also by their Serb ringleaders, who, of course, did the same in Bosnia and Herzegovina and in Sarajevo.
Unfortunately, we also saw serious attacks carried out during this recapture. But we should not confuse cause and effect. We then punished Croatia for this recapture by denying it our friendship. We refused to grant it any aid. And because we refused to help, many things then started to go wrong in Croatia, with wrongful privatisation, corruption and so on.
The new government has now taken a European line in many policy areas. It is seeking to cooperate with The Hague. It has stopped supporting separatist movements in Bosnia and Herzegovina. It is currently adopting difficult austerity measures in order to meet the preconditions. So I believe Croatia has deserved this support. It can become a factor of stability throughout the region.

Martínez Martínez
Mr President, during the years when I was President of the Parliamentary Assembly of the Council of Europe, I had the opportunity to support many Croatians in their efforts towards the freedom and prosperity that they, like other peoples on our continent, identified with their integration into the European institutions.
In the 20th Century, Croatia has gone through the same stages that many of us that are now part of the European Union had to go through. In the last 60 years, Croatia experienced a particularly awful form of fascism. A fascism like that in Germany, Austria, Italy and Spain: a characteristically European path, therefore.
Then the Croats, through a particularly militant anti-fascist resistance, freed themselves from Nazism. This journey of resistance is part of the best of European heritage.
After a new and long period of authoritarianism came the outbreak of independence, led by nationalist forces and others based more on purely democratic aspirations. In the struggle between them the Croatians had to go through a new chapter of ultra-nationalist authoritarianism, supported paradoxically by their Serbian counterparts, through the occupation of part of their territory and through the war.
With peace and the consolidation of democracy, the Croatian people have chosen the path of moderation and tolerance, freedom and respect. And they have clearly identified that choice with their full participation in the project for European construction.
The entry of Croatia into the Council of Europe made a decisive contribution to the positive developments that have been taking place in the country, and was a step further along the road to the stabilisation and association agreement with the European Union, which we are debating today and which we want to become a reality as soon as possible. This agreement is nothing if not a step further towards Croatia' s accession as a full member of the European Union, and there is no place on that path for any conditions other than those that the other applicant countries have to comply with.
The Croatians have a right to that accession, but, moreover, I think it is obvious that the European project would be incomplete as long as Croatia was missing from the mosaic, along with its other neighbours from the former Yugoslavia. We will therefore vote in favour of the proposals put forward by our friend Mr Baltas and we commit ourselves to continuing to support Croatia in its efforts to become one more member of the European Union.

Patten
Mr President, I am delighted to be able to comment on the excellent report by the honourable gentleman, Mr Baltas - produced, as several honourable gentlemen have said, with considerable expedition - on the Commission's feasibility study for a stabilisation and association agreement with Croatia.
This has of course been a historic year for south-east Europe. It was Croatia - we should not forget - that got things moving with its elections under a year ago. So I am delighted that we celebrate the end of the year by launching negotiations with Croatia for a stabilisation and association agreement.
We initiated those negotiations appropriately enough at the Zagreb Summit a fortnight ago and the first full negotiating session takes place on Monday in Brussels. We hope to make swift progress in these negotiations and to be able to conclude them rapidly. How rapidly depends to some extent not just on us but on the Croatian negotiating team who are extremely well prepared. I have to say that, on the basis of Croatia's performance this year, I have every confidence that we will be able to set a brisk pace. Certainly that is what Croatia has done during the course of the last months: setting an example to its neighbours, demonstrating how rapidly it is possible to turn a country's political fortunes around, given sufficient vision and political courage.
I want to pay a warm tribute to Croatia's leaders and to her people for what they have achieved. Croatia has, for example, bravely transformed its relations with The Hague, based on the wise assertion of her President that it is only by establishing individual guilt that a country can truly be absolved of collective guilt. Wise advice, applicable not just in Croatia but wherever war crimes are alleged.
As Mrs Stenzel pointed out, Croatia has joined the PFP and WTO, and it has taken on a host of other international obligations. The new government has made radical changes to Croatia's relations with Bosnia and Herzegovina, clearly distancing itself from extremists in Herzegovina and instituting a more open financial relationship with the Croat components of the federation army. It has pioneered free trade agreements with FYROM and Slovenia and now with Bosnia and Herzegovina. It played an extremely helpful role in supporting the democratically elected government of Montenegro in withstanding pressure from the Milosevic regime.
At the same time, the government has started to make real reforms at home - politically and economically - that have led us to conclude that Croatia would be able to uphold the substantial obligations which a stabilisation and association agreement entails. Last month, as the House knows, Croatia hosted, with extremely impressive efficiency and diplomatic finesse, the historic Zagreb Summit. I do not think that is a bad record for a year. So I am pleased, if not surprised, that Parliament backs our judgement that it was right to proceed quickly to begin these negotiations with Croatia.
I share many of the observations in the report. I strongly agree, for example, that we need substantially to increase our financial support for Croatia under the CARDS regulation. We have a team of officials in Croatia this week to look at programming for next year. I strongly endorse Parliament's view. I know that it is the strong view of the Croatian Government that countries participating in the stabilisation and association process must be judged on an individual basis on their own merits.
The agreements must be tailored to their particular circumstances and adjusted to the rate of progress that they have made. That is certainly our approach, and the speed with which we have adjusted our policy towards Croatia in recent months testifies to that. We also naturally want to see countries participating in the stabilisation and association process taking the lead not just in establishing closer relations with the European Union but with each other too.
This is not - and I want to emphasise this point - a sort of back-door attempt to try and recreate Yugoslavia. It is an underlining in our relations with these countries of what has been our own experience. We coped with appalling political division. We coped with turmoil by coming together, by trying to work together economically and politically. It should not come as a surprise to countries which want a better relationship with us, which want a closer relationship with us, which want to join us in the European family, when we insist on exactly the same for them.
In the last year Croatia has embarked boldly and decisively on the road to Europe, but there remains, despite recent progress, some way to go. We will need to see a strong continuing commitment on the part of Croatia and on the part of other governments in the region to refugee return - a point which a couple of honourable Members referred to.
Above all we will need to see continuing economic and institutional reform, the establishment of a genuinely free economy, reform of property law, the strengthening of the independence of the judiciary and the protection of the rights of minorities. There will also need to be serious reform of the media, with a real effort to create a genuinely open and pluralistic media environment, living up to the highest professional standards of impartiality and independence, especially in television.
So we will continue to need the support of this Parliament as we urge our Croatian friends to press on with these reforms, many of which will bring pain before the gains are evident. We welcome Parliament's support so far, not least on the important question of the legal base for the stabilisation and association agreements. This is an important point for us and we will, I hope, be able to count on Parliament's support when we come back to consult you formally once we have negotiated the agreement. The conclusion of the stabilisation and association agreement will, of course, be subject to the assent of this Parliament.
With the start of these negotiations, Croatia has embarked on a new era in its relations with the European Union. Croatia has won many friends in Europe for the role it has played in the last year and for the progress it has achieved. Of course, in many respects the hard part is only just beginning, but I have every confidence that the people of Croatia are equal to the challenge, equal to the difficult path of reform, the path to Europe that now lies ahead. We in the European Commission look forward to helping Croatia to meet that challenge and to helping Croatia along that road.
As I said at the outset, this year began with the people of Croatia and their new democratic government lighting a candle. I think it was remarkably important for the whole region. We owe it to Croatia to give the government and people of Croatia every help in the years ahead and we are extremely grateful to the honourable Member for his wise advice in ensuring that we pursue this route.

President
That concludes the debate.
The vote will be taken tomorrow at 11.30 a.m.
I should like to thank all colleagues who contributed to the debate and kept so well to their speaking time. It is unusual for this Parliament. I will be severe from now on.

Developing closer relations with Indonesia
President
The next item is the report (A5-0323/2000) by Mrs Maij-Weggen, on behalf of the Committee on Foreign Affairs, Human Rights, Common Security and Defence Policy, on the communication from the Commission to the Council and to the European Parliament on developing closer relations between Indonesia and the European Union [COM(2000) 50 - C5-0288/2000 - 2000/2152(COS)].

Maij-Weggen
Mr President, ladies and gentlemen, when the Commission issued its communication on relations between Indonesia and the European Union a year ago, Indonesia seemed to be on the way to a true democracy under the Wahid government, which had newly taken office. A year on, the picture looks far less optimistic.
The road to democracy, to respect for human rights, to a sound administrative and legal system, to the eradication of corruption, seems to be a long road beset with obstacles. Here is a great deal of opposition to the Wahid government and the process appears to have come to a standstill. This opposition to the democratically elected government comes from various quarters, from military circles, from the supporters of the corrupt Suharto regime, from groups of fanatical Muslims, and from armed militia circles.
The President is also still under fire over the Bulog and Brunei affair. However, it is important that the Vice-President and the President of Parliament have declared their loyalty to the President. The problem the government is struggling with is seen most clearly in the regions that were used as migration destinations owing to over-population, and that were also misused as conquered land.
Worst of all is the situation in Irian Jaya and the Moluccas. It is incomprehensible, in this respect, that the Laskar Jihad was given the chance this spring to go to the Moluccas in their thousands, in order to stoke up the conflicts there again. This has left the Moluccas with thousands of dead and several hundred thousands of refugees. People are very afraid at present - and that includes the 50 000 Moluccan citizens in the Netherlands - that the situation will escalate further around Christmas. We have received reports to the effect that the Laskar Jihad is preparing to launch a new offensive, in West-Irian among other places, but also in small countries such as Gorom and Lusalaut. People are being killed because they are Christians. People are being locked up in churches and forced to convert to Islam. There are even reports that the Laskar Jihad has banned all Christian church bells from ringing at Christmas. What we are seeing is religious terror. As rapporteur I find that intolerable and I would therefore ask the Commissioner what the European Union can do with respect to the Wahid government in order to prevent further bloodshed.
Then there is Irian Jaya. The violence is escalating there too. More people died this weekend. Last week, hundreds of students were picked up and four of them were returned to their parents as corpses. There are still some Papuan leaders under lock and key too.
We expressly wanted to respect the territorial integrity of Indonesia in our resolution, but surely that cannot mean the people of Irian Jaya having to renounce their own culture and identity? That sort of violence only stirs up feelings of hatred. I would like to lend my voice to the warning issued by the United States government to the effect that the violence must stop. The EU ought to take the same line.
Peace is very far from being restored in Timor and Aceh. In Timor, the militias block the return of the refugees and relief workers are besieged. And the murder of the Dutch journalist Thoenes has not been investigated yet. Three more relief workers died in Aceh last week and fifteen died at the beginning of December.
Mr President, these regional problems are the worst in Indonesia at the moment. As such, the plans to give these regions more autonomy are to be welcomed, as are the undertakings to leave more revenue from raw materials to the regions. As far as the overall approach in Indonesia is concerned, things are in fact heading in the right direction. But it is precisely these problems in the regions that are still very much apparent.
What can the role of the European Union be? Indonesia is one of the most important countries in the ASEAN area. It is important for the whole area for Indonesia to be a stable, democratic constitutional state with good relations within and outside ASEAN. The European Union must support the democratic and socio-economic developments, but not unquestioningly. We must attach conditions to our aid and support. We must see signs of progress in the democratisation process, the human rights situation must improve, the violators of human rights must be tried, corruption must be tackled and the power of the army must be further reduced. Should this fail to happen then aid will have to be suspended if necessary.
There should also be far more coordination of aid at European level. The EU embassy in Jakarta could assume a coordinating role. We also ask the European Commission to follow this policy line in our resolution.
Lastly, with all due respect for the sovereignty of Indonesia, if violence erupts again in the Moluccas and on Irian Jaya around Christmas, then international action should not be ruled out in our view. I have in mind sending UN observers to the crisis areas, where action is urgently needed, but also humanitarian relief action if necessary. The murder really must stop. Certainly that committed by army units, militias and militant Muslims. Otherwise, what is the difference between the Wahid government and the old Suharto regime?
We are very concerned and expect the European Commission to respond to these developments.

Plooij-van Gorsel
Mr President, I would like to compliment Mrs Maij-Weggen on her excellent report, and thank her for the pleasant cooperation we have had.
Political stability and respect for human rights and the constitutional state are key to economic recovery following the Asia crisis. They are also pre-requisite to closer cooperation between the European Union and Indonesia.
On behalf of the Committee on Industry, External Trade, Research and Energy, I will restrict what I have to say to three points. We are concerned about the high degree of corruption and nepotism in the Indonesian economy. Too many members of former ruling families still wield power. This is a major obstacle to economic recovery and social stability in the region and therefore needs to be tackled.
Secondly, it is essential for the private banking sector in Indonesia to be restructured. The agency for the restructuring of the Indonesian banks, the so-called Ibra, has so far been unable to allow the merchant banks to resume their loans service. What is more, the Ibra has considerable financial interests in various enterprises. It is even the sole shareholder in a few companies. These enterprises ought to be privatised. At the same time, this would create new opportunities for much-needed foreign investment.
Finally, economic relations with Indonesia are now based on the ASEAN agreement. So far, the ASEAN countries have made little progress as regards economic integration, even though the establishment of a free-trade zone between the members has been mooted for years now. My committee has therefore asked to conclude a bilateral cooperation agreement between the European Union and Indonesia. I will take this opportunity to ask Commissioner Patten to investigate this possibility, along with his colleague Mr Lamy.

Miranda
Mr President, the positive developments that have been seen in Indonesia are unquestionable, to the extent that they suggest that a new relationship and effective cooperation with that country are in order. Thus the terms of the Commission' s communication at the beginning of the year are justified, even if it is marked by a certain euphoria surely resulting from those changes.
The internal challenges facing Indonesia are, however, enormous and complex, as revealed by more recent events. There is the explosive situation in Irian Jaya, exacerbated by the use of repressive methods; there is also the difficult situation in Aceh and the Moluccas; in addition there is the dramatic situation experienced by refugees in the camps in West Timor - and the lack of measures that could change it - where the militias still act with impunity; and all this is tied up with the pressure from the former Suharto regime and the significant capacity for manoeuvring of military groups clearly identified with it and openly linked with integrationist and nationalist movements.
These facts can only concern us, and therefore the initial optimism that was so clear in the Commission' s communication should be reconsidered and tempered to some extent. There is no doubt that cooperation with Indonesia should be strengthened, and it should be directed into support for the authorities of this country in fields such as improvements in administration, the fight against fraud and corruption, the judicial system, environmental protection and improvements, or humanitarian aid for the displaced and refugees. But the level of this cooperation must take into account the effective progress the country may make in solving regional problems and the methods used for solving them, its respect for human rights, and also the country' s collaboration in the positive development of the Timor Lorosae independence process, particularly in solving the problems faced by the West Timor refugees and in prosecuting and sentencing militia members who have behaved criminally and only recently murdered three United Nations workers.
I believe the report by our colleague, Mrs Maij-Weggen, who in fact knows the situation well, satisfactorily addresses these aspects and therefore deserves our full approval.

Costa Neves
Mr President, Commissioner, ladies and gentlemen, I should like to begin by congratulating Mrs Maij-Weggen on the excellent job she has done. The democratisation process in Indonesia deserves due recognition and therefore support. One of the clearest expressions of this process, but also of the contradictions that make it so fragile, was what happened in East Timor. When the right to self-determination had been accepted, in the time between the popular vote and the recognition of the result, armed militias supported by Indonesian troops executed a detailed plan to destroy public infrastructure and thousands of homes, ruin crops and farming implements, and persecute the population, which, in terror, took refuge in the mountains and in West Timor.
As part of a delegation from this Parliament, I was one of the international observers of the ballot and witnessed the Timorese people' s amazing thirst for freedom, but I also had the impression that as soon as we had gone nothing would be left standing. There are still contradictions like this in Indonesia, whether in the Moluccas, Aceh or Irian Jaya, and they are still manifest in East Timor too. The prosecution of those who committed crimes in East Timor and are now in Indonesian territory has yet to take place. It is unacceptable that they should escape justice because of a recently enacted law. More than one hundred thousand refugees remain in West Timor, virtual human shields for the originators and perpetrators of crimes in East Timor.
I was in these refugee camps earlier this year. In them are those who committed crimes and those who witnessed them. The justice which is not being done and the refugee camps which are becoming permanent are areas for confrontation between the old and the new powers in Indonesia and reveal the fragility of the democratisation process. Only this week, top UNTAET officials were at serious risk when they left the Indonesian parliament building in Jakarta after meeting the country' s president. We can support the democratisation process, as we have been doing; what we cannot do is take the place of the protagonists in this process.

Wiersma
Mr President, Indonesia is struggling but is emerging victorious. The revolution in the country and the way in which it took place, remain the basis for cautious optimism. But the excellent report by Mrs Maij-Weggen also underlines the fact that Indonesia' s problems have increased rather than decreased. The country is not unique in that respect. After all, these problems are characteristic of a country that is having to undergo a multifaceted transition. It must develop a new identity with a better balance between the centre and peripheral areas. On the economic front, the market must throw off the shackles of far-reaching state interference and attract new investment. The poverty issue is extremely pressing. A hybrid society must be turned into a transparent one. Corruption must be tackled. The EU could lend a hand there, by talking to European companies. Old structures must be dismantled so that Indonesia can at last get a grip on itself. Many current problems are down to a lack of democratic control, for example over those parts of the army that resist change and loss of privilege. In many places, violence prevails over dialogue. What gives most cause for concern is the situation in the Moluccas, where Jihad fighters are left to their own devices in a manner which is insupportable. The government in Jakarta should do far more to get a grip on the situation on the ground, and the EU must continue to bring the necessary pressure to bear, partly as an expression of the increased responsibility that the European Union must take for the region. If these efforts should fall short of the mark, then we cannot afford to rule out the possibility of the international community becoming more actively involved. When a country starts functioning as a constitutional state again, it must also settle old scores. This process is moving very slowly. The old structures resist the due process of justice. This is hardly surprising given that they have been accessories to crimes in many cases. We ask, and demand, that the culprits be tracked down and tried, be they the Suharto family or the murderers of the Dutch journalist Sander Thoenes. Relations between Indonesia and the EU can only improve further if we know that our allies really hold sway there, and that the constitutional state is functioning properly.

Van den Bos
Mr President, the traces of Suharto are very far from erased in Indonesia. Military influence may have been reduced but is still far too great. Corruption is still rampant. Ongoing violence on the Moluccas, in Aceh and in Irian Jaya is causing great suffering among the people. President Wahid and Vice-President Sukarnoputri have been unable to demonstrate a great deal of governmental power so far. It is very important for Europe to support the economic and democratic developments in Indonesia. But as Mrs Maij-Weggen has already said, this assistance comes at a price. It must benefit the poorest sections of the population. The violation of human rights must stop, the proceeds from corruption must be traced, and above all, wealth must be far better distributed. It is very difficult to hold this immense realm together. Fortunately, the time when a handful of Dutchmen were able to do so is now past. But poor administration, where the military are left to wreak havoc undisturbed, feeds the desire for independence. The origin of the conflict on the Moluccas mainly lies in Suharto' s ill-considered migration policy, which disturbed the population balance. The situation on these islands is still alarming. Only if an impartial army steps in will there be a chance of peace. The international community must bring maximum pressure to bear on Jakarta in order to put an end to the violence on the Moluccas. More humanitarian aid must be delivered. The same applies to ECHO, which, I might add, is doing a first-rate job out there.
Irian Jaya is also suffering the effects of migration policy. Here too the local people are frustrated by the immigration of Muslims and the hard line taken by the military. It is of paramount importance that those guilty of human rights violations are not allowed to get away with it. I concur with those of my colleagues who are demanding an immediate judicial inquiry into the murder of Sander Thoenes.
Mrs Maij-Weggen has written an outstanding report and I would therefore conclude that Europe must do all it can to support the country on its way to democracy, but at the end of the day, it is up to the Indonesians themselves to erase the traces of the Suharto regime.

Ribeiro e Castro
Mr President, ladies and gentlemen, I shall begin by bringing two dates to your attention. Here, tomorrow, we shall have the presentation of the Sakharov Prize. A year ago, this prize was, in fact, conferred on President Xanana Gusmão. At that time, we honoured the efforts, the courage and the example of the Timorese people. In February this year, the Commission embarked on a new political initiative with regard to Indonesia, to which we also gave our approval here. In my view, I am sad to say, I think we were all a little hasty. I am sad to say this because I too would have liked things to have turned out well in Indonesia. I too would have liked to see the benefit of the doubt that we hastened to give reciprocated. But, unfortunately, this year has shown that it was not to be. As Mrs Maij-Weggen pointed out here in her introductory statement - which I emphatically support, together with the force of her report - the situation in Indonesia is deteriorating. We must learn from this lesson by sending Indonesia clearer and unambiguous signals, not contradictory ones.
I believe Indonesia is a great country, but it is at a crossroads, and it depends on the efforts of the international community and the European Union whether, at this crossroads, it will swing for good towards democracy, respect for human rights and the rule of law, or whether the disorder will increase. To this end, we must learn to choose priorities: we cannot mix environmental issues, social policy issues or economic policy issues all at the same level as the key problem of respect for democracy and human rights, which clearly has to be a political priority in our relationship with Indonesia. I also say we must give a clear signal, because we cannot have a two-speed policy: sometimes we seem to criticise but then we seem to do nothing. We must learn from this year' s experience, which has been a beneficial experience, and give a very powerful signal indicating the change that we want for Indonesia.

Belder
Mr President, the rapporteur, Mrs Maij-Weggen, makes crystal-clear what the real political problems are in Indonesia. She is quite forthright in naming the opposing forces of the essential and exacting process of reform. She rightly refers to them in her report as still being very powerful. However, following the latest reports from the Indonesian archipelago, we are compelled to ask whether the situation does not in fact look more serious, more precarious still for President Wahid and his brothers-in-arms, than the report would suggest. Yesterday, an insider summed up the situation in the Indonesian archipelago with the following sentence: 'the reformation is stagnating and the restoration minus the Suharto family promotes stagnation.' Stagnation of the reformation in no way implies that the way to a democratic constitutional state - and I quote the rapporteur - 'is truly leading nowhere' . Hence now is the time for the European Union to carefully support, as far as it is able, the democratic forces, which are neither numerous nor strong.
In view of the historical burden that sits on the shoulders of two present-day Indonesian regions, the Moluccas and Irian Jaya, Indonesian and western understanding for this distressing historical millstone alone would relieve a great deal of political tension and suffering. This is most definitely a task for the European Community.
The report that winged its way to me from Indonesia offers a ray of hope. Despite these uncertain times, a growing number of people within the Christian churches out there are calling for people to do some soul-searching. They want people to stop working to secure the interests of their own groups and show sympathy towards their fellow human beings, including Muslims, out of the love of Christ, which offers hope of reconciliation to the entire, and sometimes sorely afflicted, archipelago.

Deva
Mr President, I congratulate Mrs Maij-Weggen on an excellent report. I know she has great experience of Indonesia and, in particular, the Indonesian Moluccan community living in Holland. The position we have to take regarding the territorial integrity of Indonesia is simple: we have to abide by international law and by the United Nations Resolution 2504 of December 1969. That resolution categorically affirms that Irian Jaya is part of Indonesia. It is something that all our countries have agreed to, have signed up to, and have a responsibility to support. It was a recognition by the global community of the legality of the vote in Irian Jaya to become a permanent part of Indonesia and reaffirm United Nations Declaration 1514 of 1960 which prohibits any act aimed at the partial or total disruption of the national unity and territorial integrity of a country.
The situation in Irian Jaya is totally different, legally and constitutionally, from the situation that pertained to East Timor. Parliament should not confuse the two. Irian Jaya is an integral part of Indonesia historically. East Timor never was. The rule of law must therefore prevail. Yes, of course we must ensure that Indonesia maintains its progress in the prosecution of those members of the security forces accused of human rights violations. In this case we must wield the carrot and the stick. Any outside intervention other than support for democratisation and the rule of law can only be seen as counterproductive and inflammatory to all parties. There will be no winners if we take an imperial stance on this issue. I use that word advisedly.
What we can do in the European Parliament and the EU is to ask the new democratic Indonesian Government not to over-react. Over-reaction will play into the hands of the separatists, turning terrorists into martyrs and heroes. The other activity we can undertake immediately is to give massive support to good governance projects in Indonesia: support in terms of manpower, money, NGO activity, setting standards and criteria so that the devolved administrative arrangement now agreed by President Wahid can be underpinned by creating lasting democratic and civil society institutions.
If we want to help Indonesia we must act now with money and deeds, not merely words.

Seguro
Mr President, I should like to add my words to those of my colleagues, regarding both the content of the report and in congratulating Mrs Maij-Weggen on her realistic approach to it, and especially for being true to the values and principles of our European Union. I believe it is essential, when stating the route to cooperation with Indonesia, to be vigilant about the application of values and the establishment of the rule of law. This Commission proposal has come at a crucial moment, since Indonesia is at a crossroads in a serious economic crisis, and our help in encouraging the establishment of the rule of law and in encouraging support for those interested in setting up a democracy and making Indonesia a strong country but one that respects human dignity, is fundamental.
If I may, I should like to make two proposals and one request to the Commission. The first proposal is that Parliament sends a delegation specifically to visit the refugee camps, not only in West Timor but everywhere, because according to the Maij-Weggen report there are about a million refugees. It is important that we should not confine ourselves to approving the report but that we should follow it up. Secondly, it is important that the Indonesian authorities allow non-governmental organisations free passage to get medical and humanitarian aid to the inhabitants of Indonesia and to the Timorese who are in a situation of such human misery that these organisations should not be denied access. It is absolutely essential that humanitarian principles are adhered to and respected. Lastly, I should like to ask the Commission, through Mr Patten, to be vigilant in enforcing these principles, because, although I support the idea that the European Union should encourage cooperation with Indonesia, this should not be at any cost, and I therefore call for detailed monitoring of the allocation of this aid.

Lynne
Mr President, I welcome this report but I feel it is a little up-beat. The situation has improved and we must encourage President Wahid, but there are still horrendous problems. The government is weak and constantly under attack, the military resists civilian control, the economy is fragile and, above all else, human rights are poor. That is why we must link development aid to progress in human rights abuses.
We must make sure, also, that the murderers of the Financial Times journalist, Sander Thoenes, are brought to justice; and the murderers of the three humanitarian aid workers and one torture victim killed only last week by Indonesian security forces in Aceh are brought to justice, also the perpetrators of past crimes. That should include a new trial for President Suharto.
I am pleased that the UN issued indictments today because of crimes against humanity in East Timor, and Indonesia should be aware, with or without cooperation, that those trials will go ahead.

Patten
Mr President, I wish to begin by congratulating my honourable friend Mrs Maij-Weggen on what is generally regarded as an excellent report. It is a very comprehensive report and particularly useful in updating us on developments since the adoption of the Commission's communication last February.
Since then time has certainly not stood still in Indonesia. I sometimes reflect on what a great American friend of mine, who was once ambassador in Indonesia, said: he thought that of all the most important countries in the world Indonesia was one about which we knew all too little. I think the report is extremely valuable in shedding light on what has been happening. So I am grateful to her and the committee for the motion for a resolution. In particular I am pleased that the points made generally seem to be supportive of the action of the European Union and in particular of the action of the European Commission.
The key message of the Commission's communication was the need to recognise that Indonesia was undergoing a difficult period of transition in which the forces of reform needed our support. That support is to be provided through an enhanced political and economic dialogue, as well as enhanced targeted development cooperation.
The communication was written in a positive spirit, reflecting the new dawn in our relationship. It is fair to say - I suspect in the presence of the Indonesian Ambassador - that Indonesia recognised and welcomed that.
Almost a year later it is useful to consider whether our proposals and analysis are still valid, given recent political developments in Indonesia. In particular this last year has seen growing and worrying unrest, instability and human rights abuses in the regions and, in particular, in Aceh, Irian Jaya and the Moluccas, where the Commission recently adopted a decision for a further EUR 2m from ECHO to help the displaced persons in both provinces.
The situation is far from stable in all three areas. Only this weekend, as a number of honourable Members have reminded us, three local employees of a Danish non-governmental organisation were murdered in Aceh. I strongly condemn these murders. They are a reminder of the extremely dangerous conditions faced by all aid workers in many parts of Indonesia. I want to pay tribute to their bravery and dedication. I know that the House would want to do likewise.
The Commission and the Council have reconfirmed their support for the territorial integrity of Indonesia. I am glad that Parliament is doing likewise. However, at the same time we have also underlined the Indonesian Government's responsibility to maintain law and order and to protect human rights in its territory.
It is a challenging task for the democratic government of President Wahid, not least to combat what he has called the dark forces of the past that are trying to play out a national struggle for power on distant battlefields. It is essential that he rises to that challenge. At the same time he needs to meet the genuine aspirations at local and regional level for a fair share in economic growth and greater autonomy.
A special case is the still unresolved question of West Timor. Clearly it is unacceptable that tens of thousands of East Timorese refugees are still held hostage at the mercy of armed bandits who, in the name of Indonesian patriotism, try to get away without punishment for their criminal past. The government of Indonesia has undertaken some steps, but much more needs to be done and much faster. I listened with interest to the proposal made by the honourable Member towards the end of our discussion.
The extraordinary transition of Indonesia is far from over: democracy is still young and very fragile. Only two years ago Indonesia was still ruled by a military-backed authoritarian leader. The massive economic collapse in the wake of the 1997 Asian financial crisis has aggravated social tensions and ethnic conflict. It is clear that Indonesia's difficulties will not be solved overnight. The key challenges are still those which we identified in the communication. First, the consolidation of the rule of law, including civilian supremacy over the military and the combating of corruption; second, the implementation of regional autonomy in a way that reduces the incentives for separatism; and, third, economic restructuring.
So what does the future hold for our relations with Indonesia? Above all we must continue to express our support for the necessary but fragile democratisation and reforms and we must ensure, as we did throughout the crisis, that our markets remain open.
An honourable lady earlier in the debate referred to our relationship with Indonesia as part of our relationship with ASEAN. I must say that what is noticeable in our relationship with Indonesia is the extent to which that country has profited from our generalised system of preferences. It was the fourth greatest beneficiary in 1998. While EU exports dropped in 1997 and 1998 and have only stabilised since, European Union imports from Indonesia have surged significantly providing Indonesia with a trade surplus which has cushioned them against the crisis.
How should we engage Indonesia in the coming years? The main mechanisms for doing so have been outlined in the communication: more and more open dialogue both political and economic. The senior-official meetings launched this year will continue with our second consultative forum in early 2001. We also want to see enhanced contacts with the forces of reform and the reorientation of our development cooperation.
On this last point I am pleased to inform Parliament that the Commission has launched a new programme under the title of "good governance" which tries to help overcome structural weaknesses in the management of public affairs. Furthermore a country strategy paper, outlining our long-term development strategy, will be discussed with our Indonesian partners in 2001. Like Parliament, the Commission has also identified corruption as a continuing problem. The support we are currently giving to the office of the attorney-general in Jakarta is intended to help him in his attempts to combat corruption.
One last word: I believe that there is reason for cautious optimism as regards our long-term relationship with Indonesia, but we - that is the European Union with all our institutions - need to keep up our support. Indonesia matters hugely to us. It matters because of its size - the world's fourth largest country in terms of population; it matters because of its economic scale; it matters because of its regional role; it matters because of its environmental impact.
In between a previous colonial occupation and taking this post with the European Commission, I wrote a book and made some television programmes about Asia and I remember visiting Indonesia shortly after the riots there in 1998 and interviewing the then President Habibie. I remember having the distinct feeling that this great country was poised somewhere on the high wire between riot and reform and that we would be very lucky if the democratic process produced a government such as the one that has been produced today.
It is our task to help that government across the wire to the other side of the chasm. If it does not make that journey successfully, the consequences for all of us, the consequences in particular for the region and the consequences for Indonesia, would be dire: either the largest Islamic democracy in the world and one of the most successful democracies in Asia, or very considerable problems for the whole region. It is important that Parliament continues to show an interest. It is important that Parliament continues to press the European Union as whole to give a helping hand to Indonesia, but it is particularly important that the government of Indonesia - the president and his followers - take the brave but essential decisions that are required to ensure that Indonesia can go forward respecting civil liberties, guaranteeing and consolidating democracy and giving the people of Indonesia a prosperous and stable future.

President
The debate is closed.
The vote will be taken tomorrow at 11.30 a.m.

Protection of Communities' financial interests
President
The next item is the report (A5-0376/2000) by Mrs Theato, on behalf of the Committee on Budgetary Control, on the Commission communication 'Protection of the Communities' financial interests - The fight against fraud - For an overall strategic approach' [COM(2000) 358 - C5-0578/2000 - 2000/2279(COS)].

Theato
Mr President, in its communication the Commission writes that the protection of the Communities' financial interests concerns us all, the bodies and their members at political level, the European and the national public service and their staff. But the need to guarantee equal, effective and deterrent protection throughout the European Union particularly affects the chief contributor, namely the European taxpayer. That is whom we represent here and to whom we are accountable. So I welcome the fact that the Commission document presents an overall strategy showing how it proposes to tackle the misuse of EU funds.
However, I think the proposed period of five years, 2001 to 2005, is too long, for if we look back we will see that the issue of fighting fraud has been on the table for a long time now. A constantly growing budget has, unfortunately, also led to more irregularities and fraud. The single market has also opened the borders to fraudsters, while they remain closed for investigation and criminal prosecution. It is true that the regulations for the protection of the Communities' financial interests and on-the-spot checks were adopted, UCLAF was set up and then, one and a half years ago, OLAF was created, and articles on fighting fraud were enshrined in the Maastricht Treaty and then in the Treaty of Amsterdam. These were all good measures, but they are not enough. The fraudsters are still one step ahead of us if not more. The enlargement of the Community and the introduction of the euro could bring further risks with them.
That is why we must bring together police, administrative and criminal law resources and instruments, both between the Member States and with the EU. The Commission's four guidelines set out approaches that I find very welcome. First, an anti-fraud legislative policy. Here we must apply Article 280 of the Treaty of Amsterdam as the legal basis and develop it further, in order to bring the different national legislations under a common denominator and accordingly standardise penalties and procedures. The Commission intended to submit a document on this at the end of November. I have not received it so far. But above all, the legislation must be clearer, to prevent law-breakers from exploiting any loopholes.
Secondly, a new culture of operational cooperation. It is important that all the Member States pull together. After all, more than 80% of the fraud in EU monies is carried out in these states. So far it has not been the case that they have joined forces, because otherwise they would all have ratified and therefore enforced the 1995 convention long since. Meanwhile parts of it have become out-dated and the Nice summit has not improved matters either. But the Commission also wants to create a new internal culture, as President Prodi promised. It is to be implemented through internal reform. We are keeping a watchful eye on this process.
The third guideline is a supra-institutional approach to preventing and fighting corruption. What is at stake here is the credibility of the European bodies. That is a most important point, and here we must emphasise the importance of setting up OLAF, the European Anti-Fraud Office, which is not so very new any more, and of its activities. We must finally remove the obstacles that prevent it from acting independently, especially with regard to recruiting staff and to its own structure. That is equally necessary for the Office and for the Commission. We propose appointing a hearing officer to give some protection to the rights of the accused. We call on the EIB and the ECB finally to accede to the Interinstitutional Agreement relating to OLAF.
The system for fighting fraud must finally be perfected by enhancing the penal judicial dimension. We support the Commission's proposal to appoint a European Public Prosecutor as a first step towards creating a European judicial authority, given that this is something Parliament has long been calling for. This Public Prosecutor, assisted by Deputy Public Prosecutors in each Member State and supplemented by a judge in investigative procedures, in accordance with the 'Corpus Juris' expert report, would satisfy the principle of legal certainty and subsidiarity by acting as a kind of investigative and coordination office, without encroaching on the powers of the competent national courts. His remit must be limited strictly to the protection of financial interests; the rules and mechanisms governing his operation can then be regulated by reference to secondary legislation in the codecision procedure.
I am aware that there are still many reservations about this. They need to be allayed, because it is only through constitutional and uniform regulations and measures, which the Nice summit did not, alas, produce, that we can tackle these kinds of crimes. I thank the Commission for its efforts and its work ...
(The President cut the speaker off)

Stauner
Mr President, when it comes to money, we all know it is no joke. The same applies to the European Union. That is why we and the other EU bodies agree that we must give priority to protecting the Community' s financial interests. However, we are of different minds on the question of how and by what means we can guarantee this protection. If we are to fight fraud efficiently, we must bring together all police, administrative and criminal law resources, for this is a matter of the European taxpayers' money and indeed of far more than that. It is a matter of trusting in the care taken by the European institutions, and above all of trusting the way the Commission handles the monies entrusted to it.
Indeed we know this trust may be failing somewhat in view of the sum the Commission itself named in its 1999 report on fighting fraud, namely a loss of some EUR 850 million as a result of fraud and irregularities. So the Commission must carry out internal reforms so as to finally make good its announcement that fraud will no longer be tolerated and that it will consistently follow up all cases of fraud. OLAF, the European Anti-Fraud Office, must operate alongside it. The report before us rightly devotes most space to that institution. The conclusion of the OLAF Supervisory Committee of 5 December makes it strikingly clear that OLAF is still far from being independent or functioning properly. It says that the obstacles the Commission sets in the way of recruiting OLAF staff can under certain circumstances constitute an irreversible risk to the fight against fraud. I expressly call on the Commission to refrain from any interference in OLAF's activities. Finally, I am in favour of appointing a European Public Prosecutor, so that those responsible for fraud face criminal prosecution.

Bösch
Mr President, this is the Commission's big moment that is what I would like to call out to you. The Nice Summit brought no progress in the protection of the Union's financial interests either. It is now crucial for the Commission very rapidly to put forward resolute and imaginative proposals so that we can move ahead within the existing legal framework. Mrs Theato's excellent report points to a number of options. It once again confirms the proposal set out in the report by the five independent experts on the reform of the Commission, namely that it is possible to set up a European Public Prosecutor's Office on the basis of the Treaty of Amsterdam.
As early as May, this Parliament called on the Commission to present proposals for a first stage, during which the European Public Prosecutor would be responsible only for offences and crimes committed by members and officials of the EU institutions against the financial interests of the Union. Its task would be to direct the relevant OLAF investigations and to make it easier for the competent national courts to prosecute these crimes. I am sure, Commissioner, that once this first step is taken, the discussion about the European Public Prosecutor's Office will no longer seem like a religious war between those for and those against, which has blocked all progress so far. And the Commission has this chance to take a first step, especially after Nice. Mrs Schreyer, you have our full support if you take this first step.
The previous speakers have already had quite a lot to say on the question of OLAF. The Supervisory Committee's latest and very serious opinion on recruitment has also been quoted.
Mrs Schreyer, you have repeatedly emphasised to this House that as the Commissioner responsible for fighting fraud you see it as your special task to guarantee OLAF's independence. Please tell us whether you do or do not support Mr Brüner on this crucial issue. We know that the Commission discussed this question at its last meeting, without coming to a decision. Do tell us what you think will happen now on and how we can get out of this impasse!

Rühle
Mr President, I can be very brief because this is not the first discussion we have held on the issue. In this context I would therefore also like to thank the rapporteur for her persistence in entering this item on the agenda again and again, for her persistence in repeatedly calling for a European financial Public Prosecutor. I think precisely that should be the end result, of Nice too. We must continue to work towards it with perseverance. We can see that there are major deadlocks in the Council, that some Member States have made no progress since 1995, that there are still deadlocks. However, we also see, and that is something I really welcome, that the current Commission has taken up this issue and endeavoured to draft a document for Nice, and that it is working on this issue together with Parliament. I believe that is an opportunity for us in this situation, because Parliament and the Commission can achieve something jointly. And the only way to break the Member States' resistance is by working jointly. Above all, we must seek to create openness.
We held a hearing a short while ago. I believe we should continue with this. We also have to convince the members of the national parliaments, because that is the only way we can go on working and make progress. We urgently need a step in this direction, in order to persuade our electors, and especially our taxpayers, that the fight against fraud really is taken seriously at European level too and that we shall seek to ensure that the same criteria apply at European as at national level.

Camre
Mr President, my group has a lot of sympathy for ensuring that the efforts to combat fraud, corruption and money laundering are more efficient, and we find it completely unacceptable that cross-border crime is increasing alarmingly and that the money which the Member States' tax payers hand over to the EU is administered so badly and is to such a large extent channelled away from the purposes for which it was intended. If we are nonetheless to vote against this report, it is because we do not believe in the effectiveness of the resources proposed by the report for combating fraud and crime. Despite our having every possible sympathy for the rapporteur, Mrs Theato, and for her sterling efforts, we are opposed to establishing an independent European prosecution authority because it is a staging post towards the federal Europe we oppose.
It is the very establishment of a form of economic administration at EU level that creates the problems, because those models for redistributing EU taxpayers' money which have been established by the so-called 'Community' are poorly designed and in many cases quite unwished for. The less money there is in the EU' s coffers, the less fraud there is. In her speech at the meeting last month of the justice ministers of Germany' s constituent States, Mrs Theato expressly said that the open frontiers facilitate criminal activities. I agree. The Schengen Agreement is a catastrophe for probity, but who has created Schengen? The EU has done so. We do not believe that more solutions at Community level can improve the fight against crime because the efforts will be characterised by just as much indifference, slovenliness and secrecy as the EU' s administration in general. We can clearly see from the treatment of recent years' auditors' reports that powerful forces here in Parliament too are busier preventing the clearing up of fraud than in prosecuting the people responsible. We welcome negotiations between the Member States concerning uniform legislation in the area of crime, but we shall not submit our countries to a federal EU prosecution authority.

Dell'Alba
Mr President, Commissioner, ladies and gentlemen, I voted against the Theato report in committee and also in my group, the Radical Group, and I will vote against it tomorrow because of the Manicheism and inward-looking attitude characterising both this report and the activities of the Committee on Budgetary Control in general or, at any rate, some of its members.
Anything that is good derives from the Committee on Budgetary Control and all that is bad comes from elsewhere; this is why the report is full of references to the previous resolution. As we said three months ago, you would think that the whole world were under the rule of the Committee on Budgetary Control alone.
Mr President, we will vote against the report for two reasons: firstly because there used to be UCLAF, and you would have thought that UCLAF were an avenging angel come down to earth. UCLAF could do not wrong and we forced a Commission to resign on the basis of UCLAF's inquiries. Now - for some strange reason - the former UCLAF officials are no longer in favour and we have to banish them and give an OLAF director the power to decide the life or death of these hard-working officials; upon the decree of the Committee on Budgetary Control, these officials have to leave OLAF, being originally from UCLAF and UCLAF was all that is wonderful for some people, to the extent that we forced the Commission to resign.
The other reason why we will vote against the motion is because, with regard to the request to establish the post of European Public Prosecutor, it is not enough to have included a reference to the juge des libertés but we must ensure, once and for all, that there is a system of guarantees: indeed a Prosecutor alone with no system of guarantees is a step not towards democracy but towards an inquisition-like system which is likely to be dangerous, so much so that the proposal was not adopted at Nice.

Heaton-Harris
Mr President, it is always a pleasure following Mr Dell'Alba, because he makes a British Euro-sceptic sound very sensible in this place. I would very much like to congratulate the rapporteur - someone I like and admire as a person and politician - on this report, but unfortunately I cannot. Had it not been for the amendments concerning OLAF being adopted at the committee stage, I would have struggled to find any part of this report to support. Fortunately this idea found very little support at Nice last weekend. The Council - as pointed out so eloquently by Mrs Rühle earlier - does not like this idea either.
My personal view is that the European Public Prosecutor is just the first step along the road to corpus juris, a body of common law across the continent. Indeed I believe that is what the Commissioner feels too. Perhaps, Commissioner, you would be so kind as to let me know whether that is the case - whether this is the first step to something that would be a common body of law across the continent. I thought I heard you say something similar to that in committee.
I should also like to know why the Commission's paper on this subject had its release delayed until the day after the Danish referendum on the euro. Perhaps the Commission knows that whilst this proposal has some support in the political classes of Europe, its support stretches no further than that.
Often in argument for a European Public Prosecutor, you hear that these proposals are only to protect the Community's financial interests - something that everybody should agree with. Interestingly though, they are often sold as being a small step - there is not much behind them. So why all the concern? Well, for those of us who are still wading through the Court of Auditors' report, we will find that one definition of fraud against the Community is the black market - paying for goods à la belge, as they say in Brussels. This is fraud against the Community because the EU takes a small percentage of all VAT transactions. So another question springs to mind: if the European Public Prosecutor is allowed to investigate every VAT transaction across Europe, how big will that office be?
There are so many other questions - the relationship with OLAF, who appoints the European public prosecutor, who they report to and how it affects the Member States - that I am afraid I am urging the British Conservatives and others to vote against this report.

Morgan
Mr President, I have to follow Mr Dell'Alba and Mr Heaton-Harris and this will be tough. I would like to congratulate Mrs Theato on her report and in particular for making the effort to come here as I know she is not feeling very well tonight.
The report deals with the protection of the Community's financial interests and how we deal with that and these are the major questions. It is always the area where we see hugely inflamed headlines in the papers and we need to tackle these issues seriously otherwise we are going to continue with a largely Eurosceptic public like the people represented by Mr Heaton-Harris.
We must not forget that 85% of the money is spent within the Member States and we must also not forget that Parliament' s and the Commission's role is to take a pan-European approach to these things. We must also remember that fraud also concerns money that is not collected, something that happens very often. We lose serious amounts of money because it is not collected by the Member States. It is interesting that several countries, however much they protest about fraud, still have not signed up to the Convention on the Protection of the Communities' Financial Interests. I put an amendment down to name these countries because it is about time they were named and shamed. We need to bring these countries out into the open to reveal their hypocrisy.
It was quite interesting to hear what Mr Prodi said today because he sounded quite enthusiastic about the European public prosecutor which is quite a shift from what we have seen in the past. I must emphasise, from the point of view of the political group, the amendment that was tabled by Mr Bösch was critical of the report because it talked about concentrating on the institutions of the European Union, the public prosecutor being relevant only in that sense.

Schreyer
Mr President, ladies and gentlemen, the fight against fraud detrimental to the European Union is a high priority of the Commission's activities and is an important aim for the reform of the Commission's overall financial management. Today we are debating Mrs Theato's report on the Commission's report on its strategy for fighting fraud. The Commission presented its report in June this year and I welcome the fact that we can debate the reports as early as today.
The Commission takes an overall approach in its strategy for protecting the Communities' financial interests and fighting fraud; overall means that it involves all levels of activity and also all the players, all the players in the European Union institutions as also in the Member States as also in the candidate states or third countries that are responsible for dealing with European money.
The strategy is built around four main lines of action: an anti-fraud legislative policy, operational cooperation between the relevant authorities, an interinstitutional approach to combat fraud in office and enhancement of the penal judicial dimension. Since time is short I will present the individual points briefly. The first strategic line of action consisting of comprehensive legislation to combat fraud includes legal provisions to prevent, detect and prosecute cases of fraud. For if a policy to protect the Communities' financial interests is to be effective, it must be based on clear and easily applicable legal rules that contain provisions on efficient financial management.
The second line of action relates to operational cooperation with the Member States and the candidate states and third countries. It is precisely in this area that thanks to the creation of OLAF we have a very powerful instrument. We are expanding its field of application step by step, which means first and foremost making greater use of OLAF for the collection and evaluation of information, as a kind of intelligence service for the fight against fraud.
The next step will be to organise OLAF's working methods in such a way as to turn it into a real platform of services for the Member States and for the authorities involved in the fight against fraud. As Mrs Theato rightly points out in her report, OLAF occupies a crucial position in the Commission's anti-fraud strategy, which is why, and I want to stress that very strongly, the Commission is extremely keen to see this authority built up rapidly. There are, however, a number of difficulties with regard to the legal basis for setting up OLAF. You know that the Commission would have preferred OLAF to be set up as a totally independent authority. But, and here I am addressing Mr Bösch, a different legal basis was created. OLAF is independent in the operational field while on the other hand it has to carry out tasks for which the Commission is directly responsible. That is bound to create difficulties, which must of course be resolved. I can only assure you once again, in regard also to the issue of the recruitment authority: the director of OLAF is entirely independent in the appointment of staff, and that applies not only to the lower level but also to the more senior and top levels. What you are addressing now is the following issue: will OLAF also use an advisory committee in order to bring more transparency into the selection process for senior officials? Actually I am sure that it is also in OLAF's interest to make the selection of senior officials transparent.
I just want to point out the following: we now have to live and work with this legal basis. The Supervisory Committee is constantly putting forward interesting proposals and considering the further development of the legal basis. In this regard the Commission is very open to proposals and reforms.
The third line of action is common action by the European institutions to fight and prevent fraud in office, and here let me point out that the Commission's complaints against the EIB and ECB because of the disputes about OLAF are still pending and that the complaint by 70 members of this House against OLAF's investigative powers is still pending.
Finally, the fourth line of action concerns the penal judicial dimension, and along with it, the penal judicial consequences of established, detected or presumed fraud. Here the overall situation remains as unsatisfactory as ever, especially as regards cooperation with the Member States, not because of any unwillingness but because of the structural inadequacies and difficulties that exist in this field. That is also why the Commission took the step of submitting a draft document on establishing a European Public Prosecutor's Office to the Intergovernmental Conference in Nice. More and more countries took a positive view of this proposal during the preparatory discussions for Nice. That did not give rise to any hope that the Treaty would be amended accordingly, but did justify the hope that a decision would be taken in Nice on how to move forward on this issue. Unfortunately, no such decision was taken in Nice on the Saturday evening, because of the objection of one state, which I find most regrettable. Nonetheless, the Commission will not be discouraged and we will ensure that there is a public debate. The next target date is 2004, the next Intergovernmental Conference.

President
The debate is closed.
The vote will be taken tomorrow at 11.30 a.m.

Reform of budgetary control procedures
President
The next item is the report (A5-0383/2000) by Mrs Morgan, on behalf of the Committee on Budgetary Control, on reform of budgetary control procedures and institutions [2000/2008(INI)].

Morgan
Mr President, I am more than aware that this report will not rate amongst the greatest, most radical contributions to the European debate. The fact that there is such a "huge" turnout here tonight is a recognition of that fact by others. Nevertheless there are a number of factors and issues within this report. It should be seen as an opportunity for Parliament to reassess its work in relation not only to budget control but specifically to the discharge procedure.
We must not forget that it was the reluctance of Parliament to give the green light to the way Euro-taxpayers' money was spent in 1996 that precipitated the fall of the Commission in 1999. What we are seeing as a result of the resignation of the Commission is a radical reform process. However, we must be careful within the European Parliament not to miss seeing the log in our own eye because we are concentrating so hard on the splinter in our neighbour's eye - the Commission. We have problems as well, perhaps not quite as big as the Commission's, but it is important that we recognise we also have problems.
It is clear that the nuclear button in the shape of the discharge procedure cannot be pressed at the first sign of trouble. So the European Parliament needs to use this powerful weapon at its disposal in an extremely sensitive manner. The discharge procedure gives Parliament an opportunity to assess the financial management and financial resources of the European Union, to propose measures for its improvement and to express an overall political judgement on its quality.
It is clear that the main focus of our work, within the Committee on Budgetary Control, will be on Commission management, and that ultimately we recognise that the Commission bears responsibility for implementing the budget. However, we must not forget that 85% of the money is spent and misspent within the Member States of the European Union. For far too long the Member States have hidden their guilt behind the complex mass of Commission officialdom who cannot answer back.
Let us take one example: late payments. If EU money does not arrive on time, people lose their jobs. This has happened on several occasions in relation to the structural funds, for example. We have EU laws to protect business from such mismanagement and the Commission has now promised to introduce its own regulations to ensure prompt payments. But if the Commission coughs up money just to see it sitting in a Member State's coffers gaining interest, the problem persists as far as the end-user is concerned. So, where are the reforms from these guilty Member States?
Here we have a problem, because we as the Committee on Budgetary Control and as a parliament are only as good as the information we have to work with. We depend on the Court of Auditors to provide us with the ammunition to fire at the problem areas. However, the reluctance of the Court - and for that matter the Commission - to name the guilty countries impedes our work. We are trying to extinguish a fire and are suffocating in the smoke. We need to know the source of the flames. The Court of Auditors and the Commission can hide behind the complication of the statement of assurance, but we will not be steered off our course. We have heard that, because spot checks are involved, it would be unfair to name the Member States. My colleague, Mr van Hulten drew an interesting parallel with spot checks on athletes who have had their whole careers ended. If they are guilty, they are named and shamed. We should do the same within Parliament.
We also need to be given the complete picture when the annual report of the year under consideration is published. That means we need to know which countries paid back what. We need to know what is happening in terms of recovery.
It is imperative also that we stick to the remit required of us and that we concentrate exclusively during the discharge process on the year in question. We have other mechanisms to highlight previously undetected instances of fraud.
Another key recommendation in this report is to try to expand the responsibility of the discharge beyond the exclusive domain of the Committee on Budgetary Control. Controlling the Commission's management and spending is the main justification for the existence of the European Parliament and the discharge procedure is the chief instrument by which this is done. We have tried to get other committees involved in the past but they have not responded, so we want to try to change the regulations within Parliament. We are trying to watch the Commission and the Member States and this report is an attempt at doing that.

Pomés Ruiz
Mr President, I would like to start by protesting at the fact that this debate is being held at night. It is shameful that we have to debate this and other important matters at night. It is shameful. And no one can understand it, including myself. Mrs Theato has come to this night sitting despite being ill and I have left a dinner with the representatives of "¡Basta Ya!", winners of this year' s Sajarov Prize. This situation has to change.
Next I would like to congratulate the rapporteur on her report, which is so important and, contrary to what has been said, so necessary. Moreover, I think that her report is part of our new way of understanding what should be politically correct in the institutions, and that is transparency.
In this morning' s debate on the European Council in Nice we criticised the fact that the meetings were held at night and behind closed doors. It would be good to know what goes on there and perhaps, if the doors were open, the Member States would behave differently. That is precisely the major contribution made by the Morgan report. Its aim is that in this whole process there should be transparency, that we should not beat about the bush, that fingers should be pointed and that it should be made clear that the services are doing things badly. For example, I would like to criticise the fact that, when the report of the Court of Auditors was presented, the Council was absent, as if it is not interested in this Parliament. I also think that it is worthy of criticism that the Council is not present at the meetings of the Committee on Budgetary Control, which is precisely where the faults that arise in 80% of the budget, which the Council spends, are discussed. One day we will have to change this sort of absence of the 'innocent hand' of the Council, which is never guilty of anything. Mrs Schreyer, you have just mentioned the Council, saying that there was a Member State that opposed the creation of a European Prosecutor. It is time for the politically correct thing to be to say which Member State it is and to give its full name.
This also happens in many reports. This very morning, for example, in the debate that we had in the Committee on Budgetary Control, we saw how the representative of the Commission, when we asked him to indicate the Member States that do things badly, answered: "Look, the monitoring of what the Member States do is done through sampling, and there is no reason to penalise the Member States whose irregularities have been revealed through sampling." Well I do not care. They should say that, according to the sample, such and such a Member State is not doing things right.
I would like to finish by saying that it is important for there to be monitoring of the approval of the accounts, and for me this is the most important thing, that is, that there is reason for amendment not only by the Commission but also by the Council. It is also important to include observations in the reports on the Member States about how they comply with or fail to comply with the conclusions on the approval of the accounts. I would like the Member States, at least the Presidency and the representatives of the Member States being discussed, to be present for debates in Plenary, and also in committee.

Casaca
Mr President, I would like to start by commending the timeliness of this initiative and the diligence with which our rapporteur, Eluned Morgan, has carried it out. The aim of the discharge procedure is to analyse processes and procedures in force and to detect any inadequacies in them so that the institutions can then proceed to reform them. To achieve this aim fully, I shall highlight four requirements that I consider essential in the work of the budgetary control authority.
First of all, balance in considering all the budget headings: it is unacceptable that the analysis of own resources performed by the Court of Auditors should explicitly exclude all revenue from undeclared economic activities, in contrast to the zeal with which it treats many administrative elements, sometimes with no substantive content, of various forms of expenditure. Secondly, transparency with regard to cases and events: whenever the Court of Auditors refers to specific cases it should identify the institutions involved, thus taking responsibility for the claims that it makes. Thirdly, thoroughness of analysis: it is incomprehensible that a large number of high quality special reports by the Court of Auditors are omitted from the Annual Report in favour of other matters treated without any prior analysis and on the basis of debatable criteria of political timeliness. Fourthly, accuracy in the use of statistics: statistics can be a valuable tool for analysis but they can also be a dangerous tool for distorting reality. Using statistics to compare irregularities detected by different institutions as a result of strict or not so strict controls may be more liable to hide what is happening than to expose it. High rates of detected irregularities may just as well indicate the zeal of enforcement authorities as suggest corruption in the regulatory system.

Mulder
Mr President, even though the rapporteur has stated modestly that the report could have been better, I would still like to offer her my compliments.
As has already been mentioned, the instrument of discharge is one of the most important weapons that Parliament has. It is therefore absolutely vital that we treat it with care. The Court of Auditors supplies reports and one of the most important recipients of these reports is Parliament. I therefore feel that Parliament would be well-advised to let the Court of Auditors know exactly what it expects from these reports. Also, a number of people have already said that we want concrete, succinct reports so that we know where we stand, and reports which are easy to read. We must name countries, specific cases and institutions; all these things would make it easier to understand. My group also thinks it is extremely important for there not just to be an SOA for the entire budget, but also one per sector. In the final analysis, we must be able to assess whether it is getting better or worse. I also think the idea mentioned in the report that members of the Court of Auditors should appear in the specialised committees of this Parliament, is an excellent one, because we cannot follow everything ourselves, instead, we must combine forces.
As far as Parliament itself is concerned, the problem is the Treaty. The Treaty states that we can grant discharge but it does not say that we are entitled to refuse to grant discharge. I feel Parliament must sort this out. We must be able to do it ourselves, but I feel that refusal to grant discharge is an extremely important political matter. Indeed that is why it says in the report that if it should come to that, Parliament must immediately hold a debate on the political consequences thereof. Amendment No 8, tabled by the Liberal Group, states that it is important for the Committee on Constitutional Affairs to further elaborate the recommendations of the Morgan report so that they can be used.

Stauner
Mr President, this excellently crafted report shows that the Committee on Budgetary Control can take a coherent and convincing position on such a controversial issue as the importance of budgetary control procedures and bodies. Budgetary control will always be a tough and thankless business, because it is not a question of handing out compliments but rather of pointing out weaknesses, mistakes and omissions and thereby improving the way the Commission handles the European taxpayers' money.
In colloquial terms, what this report is saying is that in future the Committee on Budgetary Control will be more watchful and will want to hear names named when it comes to the unknown whereabouts of European tax monies. Neither the Commission nor the Member States will be able to absolve themselves of responsibility, certainly not by passing the buck from one to the other.
Point 21 of the report contains a very courageous decision in announcing that the discharge will be postponed if the Commission withholds information. I hope this obligation will actually be applied if it comes to the crunch. Had Parliament taken this decision sooner, it could not have given the 1998 discharge. For in fact, the Commission is still withholding information and has still not answered questions, especially with regard to the Fléchard affair.
I also want to highlight point 20 of the report. It is a clear declaration of belief in the rights of each and every Member to request and obtain information from the Commission, including confidential documents. This declaration of belief in the rights of individual Members is particularly important because these are precisely the rights the Commission is calling in question. It does make us rather apprehensive, Commissioner, to find that the Commission as Guardian of the Treaties has to be referred explicitly to the need to observe MEPs' rights.

McCartin
Mr President, I want to thank Mrs Morgan for her report and to say that I believe it is an important report and good report. It has been the product good cooperation at the committee level and I want to acknowledge that Mr Pomés Ruiz and Mrs Theato made their contribution too. This report will go some way towards clarifying the responsibilities that we have and helping the European Commission as well to understand what its role is and what is expected of it. I would also like to echo the words of Mr Mulder when he spoke of the importance of the procedure for granting discharge and stressed that it must be taken extremely seriously. The people who work on the Committee on Budgetary Control sometimes do not realise the importance of this instrument in guiding the work of the Community in so many fields of their responsibility. We must pursue this task with firmness but also with moderation and understanding and we must understand that over the years - perhaps because public spending at European level was such a small percentage of the entire public spending of the European Union, 1% as against 40% on average by the Member States - it was seen as a detail. I think it is true to say that it was very hard to get the Member States to understand that they had to apply the same concern and the same care to guarding the resources of the Union that they did to guarding their own resources.
I heard - and it is not an isolated incident - the United Kingdom Minister for Social Welfare say on television that if he could stop fraud he could save GBP 6 billion. He said that quite honestly and regretted that it was so. But if a European Commissioner said that we would expect them to resign the next morning. So let us understand that fraud is not a problem peculiar to the European Union.

Heaton-Harris
Mr President, I too would like to congratulate Mrs Morgan for writing this report especially considering the remarkably tight deadlines that she set herself by falling pregnant. I am sure that this House wishes her every success in that particular project, although I am slightly worried that the baby's first words might include the words "discharge" and "procedure". I would also like to commend to the House the way in which from its conception this report was drawn up using other reports already passed by our committee. Some here will know of my interest in the budget in general, and as budget rapporteur for the Budgetary Control Committee, I wrote a report in which a number of conclusions that are included here were conceived, mainly in paragraph 16 of this report. From that embryonic stage, they have now come through their period of gestation and are born within this report.
They concern a number of courses of action that the Budgetary Control Committee can take when it finds problems in different areas, including recommending to the Committee on Budgets to freeze or reduce the amount of appropriations intended for the headings concerned in the following year's budget; to authorise no transfers of appropriations to take place involving increasing the headings concerned for a certain period until further internal investigations are concluded; up to asking the President of the Commission to ask for the resignation of any individual Commissioners concerned with the serious problems found, a kind of EU Caesarean.
Finally, I would commend the rapporteur's proposals about speeding up the contradictory procedure and the various statements on the special reports, although I do have to say to the rapporteur that I intend to disagree with the five-month timetable proposed in the report for dealing with these. Perhaps a nine-month timetable would be in order.
I am sure that the rapporteur would be pleased to hear that there are few differences between the main groups to breach in these circumstances. Forceps are not required to tweeze out any agreements, and we will be voting for her report.

Schreyer
Mr President, ladies and gentlemen, as you can tell from looking at it, Mrs Morgan, this report has taken a great deal of work and discussion within and outside Parliament, within and outside the Commission, and within and outside the Court of Auditors. But after all that shows just how politically significant it is. I want to congratulate you very warmly on this successful and balanced result.
After the events of the past year, your aim is to create a budgetary control and discharge procedure which is more transparent and above all more efficient and effective. I may assure you that the Commission is constantly seeking to improve its own procedures. It will therefore also take this report as food for further thought.
You took a very useful and I believe also a very self-assured step in involving the Commission as also the Court of Auditors in your deliberations before drafting the report. Those institutions made a targeted effort to find ways of improving the discharge procedure.
Regarding access to documents for the discharge report, which is indeed an important issue, let me point out that the Commission's point of departure in its activities is the Interinstitutional Agreement reached in July this year, especially Annex 3 on access to confidential information. I can assure you that the Commission will honour this agreement in full. Let me point out to Mrs Stauner who just raised certain questions that under this agreement the committee chairperson puts questions regarding confidential information to the Commission or forwards them to it. Let me tell you that the committee chairperson has put no questions on this to the Commission.
The report calls for detailed reviews of operational activities, thorough checks of budget headings and irregularities together with an assessment of the Commission's internal performance. We are convinced that with its administrative reform the Commission has made and is still making substantial progress here. And indeed Parliament also paid tribute to this reform programme.
Mrs Morgan's report devotes much space to the question of whether in future the Court of Auditors should appraise the activities of each directorate-general and each department individually. In this context let me remind you that Article 276 of the EC Treaty refers to the discharge of the budget in general and not to individual parts or areas of the budget. In the same context let me observe that of course the risk of errors in implementing the budget regardless of whether they are major or minor ­differs widely from one department to another because they have totally different operational budgets and face different risks. In the agricultural sector, for instance, Mr Fischler's total budget comes to approx. EUR 443 billion, while the budget of the Directorate-General for the budget is almost non-existent, so that, of course, there is hardly any risk at all there. During the general debate it will of course have to be decided whether there will be different levels of tolerance of errors, because naturally it is very much easier to implement the budget in, for example, the administrative sector, where salaries are paid. I would say the tolerance of errors should be more or less zero there, while in the area of external services, of foreign policy, quite different risks arise if, for instance, we provide humanitarian aid in a war zone. That too would have to be taken into account.
You can see from what I said that I think it would be useful to discuss these proposals further in order to find out how to assign responsibilities more clearly here. After all, that is also what you seek to do in relation to the Member States. Let me point out that I will take the opportunity to discuss these proposals at the next meeting with the Member States' representatives concerned with financial control. And I will happily report back on this discussion to the committee.
Once again, congratulations on your report.

Bösch
Mr President, just a quick correction. Commissioner, the point of departure for forwarding information to the European Parliament is the EC Treaty and not the Interinstitutional Agreement. I just wanted that made clear.

President
The debate is closed.
The vote will take place tomorrow at 11.30 a.m.

Takeover bids
President
The next item is recommendation for second reading (A5-0368/2000) by Mr Lehne, on behalf of the Committee on Legal Affairs and the Internal Market, on the Council common position for adopting a directive of the European Parliament and of the Council on company law concerning takeover bids [8129/1/2000 - C5-0327/2000 - 1995/0341(COD)].

Lehne
Mr President, ladies and gentlemen, this legislative project at second reading is a really complex project, which does not make it easy to explain the context we are dealing with here. I will try to do so nevertheless.
In my view, the common position before us, which we have to decide on today, has a number of crucial weaknesses, which for the rest nobody has disputed so far during the debate in terms of principle. The first crucial weakness is the lack of harmonisation. This common position, which after all concerns the takeover of companies, seeks to protect the shareholders. I regard that as an aim most definitely worth trying to achieve. But in fact it also requires certain framework conditions. After all this is supposed to be a framework directive. In regard to a number of issues in connection with hostile takeovers, with takeovers in general, which simply have to be regulated, this common position does not really regulate anything.
Take for example the issue of what is called the takeover threshold, as from which a compulsory offer can be made, the issue of what is called the equitable price to be offered to the shareholders, or even the issue of the circumstances under which cash payments are made obligatory. We have merging stock markets in Europe. I believe that against this background it is urgently necessary not just to leave these questions open but to settle them. For that simple reason the report by the Committee on Legal Affairs and the Internal Market I am presenting today includes a whole raft of amendments containing concrete proposals on how these issues could be resolved.
I also consider it right to make these proposals, for if we do not settle these matters we must at least ask ourselves seriously, in face of the problems involved, whether there is any point at all in this directive. To inscribe in a directive that shareholders must be paid an equitable price is about as useful as saying that an apple will fall from the tree when it is ripe. Then you should also say in it what that equitable price actually is and what this whole business is really about.
The second major problem in this directive is Article 9. The purpose of the directive is supposed to be to create a level playing field in Europe. But unless the directive is amended, the end result of this common position would be that not only do we not have a level playing field with North America, we do not even have one within Europe. The Americans have what they call the 'Business Judgment Rule', i.e. the possibility of mounting a defence against takeovers. The common position provides on principle for a strict obligation of neutrality in Europe. That means that in future it will be easy for American companies to take over European ones.
The other problem is that there is no level playing field in Europe either. In a number of countries, the United Kingdom being the classical example with its London Stock Exchange, which has been much described, company law provides for the possibility of in effect excluding takeovers by restrictions to the right to vote in the company statute. So the end result of Article 9 as it now stands would be that some companies in some countries in Europe could be taken over much more easily, while other companies in other countries in Europe could virtually never be taken over if they have provisions of that kind in their statute. That is why Article 9 also needs to be amended.
The next problem is the issue of the competent supervisory authority. The common position devotes three pages to regulating this issue. If it takes three pages to do so, then clearly there will be enough points of reference and opportunities for dispute and we will create no legal certainty. That is why I believe we must also improve Article 4.
I just want to make one more observation. In the Committee on Legal Affairs and the Internal Market we managed to find compromise amendments over and above the groups. These compromise amendments do not please everyone in this House. That is in the nature of compromise amendments. But what is crucial is that we realise that this directive has serious weaknesses and that is beyond dispute. The only way to remedy these weaknesses is by deciding to opt for conciliation here by a majority of 314 votes. It is quite clear that the result of the conciliation will not in the end be the same as what the Council decided or what Parliament decides tomorrow. The result will be another compromise. If we do not adopt these amendments before us tomorrow, we will not achieve that further compromise and the directive will remain as bad as it is now.
So I can only ask this House to endorse the Committee on Legal Affairs and the Internal Market's compromise amendments. If certain circles in the Commission or elsewhere fear the directive could come to nothing, then I must honestly say I do not think so. Since the conciliation procedure was first introduced between Parliament and the Council, which is now more than six years, only a single directive, the one on the bio-patent, came to nothing in the conciliation procedure. A short while later it was, nonetheless, adopted both by the Council and by Parliament.
I really do not know why we should not eventually succeed in reaching a compromise in this case, as with all other directives. So I certainly do not share the concern voiced here. We are pursuing a perfectly normal procedure. We should complete the second reading successfully and then seek a good compromise in the conciliation procedure.

McCarthy
Mr President, on a point of order, I wish to remind Members of the House of Rule 9(2), referring to Annex I, Article 1: "Before speaking in Parliament or in one of its bodies, any Member who has a direct financial interest in the subject under debate shall disclose this interest to the meeting orally." In view of the fact that Mr Lehne proposes to strengthen the role of company directors, it is quite obvious that Members may want to declare that before speaking. It does not stop them from speaking; it may not affect our rapporteur; but certainly it applies to some members of his group who hold senior positions in the Bertelsmann media group.

Inglewood
Mr President, I ought to declare that I am a director of the CN Group. My friend Mr Lehne has given the position of the EPP Group. I am going to give the position of the British Conservative delegation and a number of other Members. However, it is not necessarily a full and accurate description of the EPP Group's position, which he has given.
When a public company is listed, the management and owners are telling the world that investors are free to buy and sell stock in it without the shadow of management or the state rigging the market against them. The European single market is a pan-European market place but within which the market in shares must be treated like other markets so that national boundaries, even if they delineate different jurisdictions, do not interfere with the essential equivalence of the rules across the market place.
Within the single market investors, be they private, corporate or pension funds, should be able to exercise the rights of ownership to the benefit of the companies in which they invest and for those investors in them.
In my country, we have real reservations about the common position, but in the spirit of good will have been prepared to accept it. Unfortunately, we believe that some of the proposed amendments do not improve it. On the contrary, some will fatally damage the project of a single pan-European take-over regime. To be effective, useful and in the public interest, such a directive must: first, avoid direct involvement of the courts, but rather have a regulator with wide powers of discretion under the rule of law; secondly, clarify and have workable rules on jurisdiction; thirdly, clarify definitions of equitable price and set proper thresholds; fourthly, ensure management cannot improperly frustrate shareholders taking their legitimate decisions about the future of the company in which they own a stake.
If we fail to get this directive right, it will tell the world that Europe will not face the realities of the global market. That will not mean that it will not have to do so in due course; rather it will merely mean that adjustment will be more prolonged and painful and the victims will be European jobs and European prosperity.

Berenguer Fuster
Mr President, it seems that we are finally at the end of the road on the proposal for a directive which will regulate takeover bids. It is a proposal that has gone down a long and, I fear, stormy road in order to overcome some of the existing problems.
It is true that there have been many problems. It is also true that the political agreement obtained in the Council last year enabled some of them to be resolved.
I will therefore offer a few thoughts on the function of Parliament: in a codecision procedure, in which a political agreement has been reached on a complex matter, what should be the role of the European Parliament? Should our role be limited to saying "Amen" to the Council' s proposals? I do not think this should be the case, ladies and gentlemen.
By this I do not mean that, once that agreement has been obtained in the Council, Parliament should decide to blow it out of the water. Ladies and gentlemen, we are politicians and therefore, we are always in favour of reaching political agreements.
These thoughts are fully applicable to this report. The Council has reached an agreement that should be respected on its main points, as the rapporteur, Mr Lehne, has done in his magnificent report, on which I sincerely congratulate him. And I congratulate him not only on respecting the main points of that agreement, but also on seeking formulae which - and I stress, while respecting the main points - try to improve the legislative proposal. This is, in my understanding, the role of a colegislative institution such as Parliament in the codecision procedure.
The amendments that our Committee is tabling can be grouped into three blocks. In the first block are a series of technical amendments that aim to either clarify concepts or fill gaps. I am not going to dwell on them.
In the second block are a series of amendments that aim to improve the participation of workers when there is a takeover bid. We cannot close our eyes to reality: when there is a takeover there is staff restructuring, redundancies and so on, in short, measures which affect jobs. It is therefore important that workers and their representatives should be informed, from the start, of what is being planned and that they can make their voice heard in the actual takeover procedure.
The third block contains those amendments that have been most controversial during the procedure. And I would like to have the power of conviction to prevent you from having any fears about the consequences that could be deduced from the approval of those amendments. It is true that the European Parliament Rules of Procedure do not make this easy, making these debates into a pure and simple dialogue between the deaf. What can we do?
The first amendment refers to Article 4, which establishes what will be the competent authority for supervising the bid. In paragraph 1 it is established that it will be that of the Member State in which the company concerned has its headquarters, if - logically - its securities are admitted to trading in that Member State. What happens if they are not admitted to trading in that Member State? An answer is proposed that does not appear to be compatible with another amendment tabled by other Members, undoubtedly in good faith, requiring the criterion of headquarters. Because if the securities are not traded there, why should they be supervised by that authority?
The second controversial amendment refers to the duty of neutrality. Here we met with very conflicting and even opposed positions, and a formula has been reached that permits some exceptional hypotheses in order to carry out some defensive manoeuvres when it is not possible to call a general meeting.
My Group and I are going to support these amendments.

Wallis
Mr President, I fear that we are in danger of losing the plot or losing sight of what this directive is about. It is part of the financial services action plan; in our Commissioner's own words, "a key element in the creation of a fully integrated market in financial services, giving investors and consumers more choice". The proposals introduce three key elements at a time when there is a change in control of a company: protection of minority shareholders, transparency in relation to bid information and regulatory supervision of the process. But what are we in danger of doing as a Parliament, by virtue of the amendments tabled?
Firstly, we are being far from transparent. Some of the amendments seem to be a covert attempt to introduce some elements of a company statute through the back door. Secondly, we are adopting rigid structures and procedures when the recommendation of the Commission was actually light-touch, allowing Member States leeway to reflect national practice in corporate culture.
Lastly, the issue of clarity: the lack of this is especially evident in the debate about jurisdiction, an issue of which I have a little experience. The common position suggested some form of split arrangement. Now we have a proposition that would lead to muddle, forum shopping, potential litigation at a delicate moment in a corporate deal. This is not helpful. Jurisdiction should be solely in the hands of the Member State where the target company is registered. This is fair for minority shareholders, transparent and, above all, clear. Indeed I would ask the Commissioner to consider whether he can accept my amendment on this crucial point.
The Financial Times editorial today talked about bid politics: that it has taken no less than 10 years to get this draft and that we, Parliament, could destroy that in 10 minutes tomorrow by voting through misguided amendments. I hope that will not be the case.

MacCormick
Mr President, I should like to assure Mrs Wallis that I shall vote for her Amendment No 19 for the very reasons which she has given - and I hope my group will be following me. This is a matter on which clarity is of the utmost importance. Similarly we will reject the critical part of Amendment No 17, which would exclude shareholders from deciding on the merits of a bid for a company that they own. The ground for this is that it is not for governments, supervisory authorities or incumbent management to accept or frustrate a bid. It rests with the company's owners - the shareholders themselves.
That is the principle on which perhaps we will divide tomorrow: what should be the over-riding concern of a law regulating takeovers. If you think that the correct thing is fairness and transparency towards all shareholders - majority and minority alike - then that determines your vote on a number of the issues here.
There are some points where I would be happy to go along with the compromise amendments, particularly those affecting the position of employees. I understand Mr Lehne's desire to get the thing taken into conciliation and further clarified. I have some sympathy with his point. But we must approach this with the governing principle of shareholder protection in our minds.

Bordes
Mr President, the aim of this report - to establish common rules in Europe on takeover bids - relates only to a tiny minority of large corporations and their major shareholders, who dominate company ownership. In the legal wrangling between the Council and Parliament, there was not even any mention of the workers, technicians and employees who actually turn the wheels of these companies which the large financial groups are fighting over. The European institutions care little about the job losses and closures caused by almost every company takeover or merger.
Personally speaking, I have no interest in the legal problems these large shareholders may have, and I will vote against this report. However, I would like to express my solidarity with the people exploited by these companies, and if Parliament had any respect whatsoever for the workers, it would at least prevent takeovers causing redundancies.

Farage
Mr President, after 18 years working in financial services, I do not believe this directive is needed. In the UK the regulation of takeovers through the voluntary code of practice administered by the takeover panel has been highly successful: a good example here of a pragmatic approach to a highly complex issue where legislation will be less appropriate. It should not escape our attention that the takeover market is primarily British. Activity in London exceeds the whole of the combined volume in the rest of Europe, therefore this measure will damage the United Kingdom. Many believe that the imposition of a legal code is simply a protectionist device to enable less efficient European companies to protect themselves from takeovers by resorting to complex legal actions.
Are European companies so afraid of competition that they feel the need to shelter behind a restrictive law which will stifle rather than improve European competitiveness? If not, then Members should vote against this directive.

Cederschiöld
Mr President, company structures in the European market need to be made more efficient if Europe is to hold its own in the global market. It must also be possible to restructure companies between one EU country and another.
This directive will probably not create the clear regulations which are now needed on the international stock market, but the battle is not yet lost. The problem is that stock exchange law is closely associated with company law and that it is difficult to harmonise the one area if the other is not harmonised. However the regulations are drawn up, someone will suffer.
In a small market like Sweden' s, with relatively concentrated ownership, harmonising the level at which offers must be made at 30 per cent will create problems, and we are demanding greater flexibility. Greater flexibility is also required when it comes to the complete duty of neutrality recommended by the Council. German companies will have problems because Germany' s company law prohibits vote diversification. Greater understanding must be shown for national characteristics. Otherwise, there may be devastating consequences for an individual Member State' s company structure.
It would, however, be easier to solve the problem of which supervisory authority is to have jurisdiction. The most flexible solution would be to choose the supervisory authority in that country in which the target company has its head office. Companies may be quoted on different markets, and companies with head offices in Sweden are not always quoted in Sweden. It would be strange to say the least if, for example, American authorities were to be responsible for a takeover involving two European companies. Anyone who wants to avoid such consequences has the opportunity to vote in favour of Amendment No 19, which makes it clear that it is the target company' s head office which counts.
If we do not defend the duty of neutrality, there will be no point to the directive. If, moreover, we open the door to defensive measures, we shall perhaps make it more difficult to restructure European markets and, especially, to protect small shareholders.
I just want to emphasise that the Conciliation Committee has a very big responsibility and that success requires everyone to pull together.

McCarthy
Mr President, it has been said that this is a very important, crucial piece of legislation we have before us. It is at the heart of the EU financial services action plan. But, more than that, the bigger prize is that we are able to take forward the Lisbon agenda of creating a competitive, dynamic European economy. For that we need an efficient market in goods, services and capital.
Mr Bolkestein, I share your concerns: we cannot afford to risk losing this directive, because the EU economy would pay the opportunity cost for years of not being able to restructure European companies. Yet the amendments tabled by our rapporteur will take us in that direction. I fear it will undermine the effect of corporate restructuring necessary to build that EU competitiveness in global markets. If we are to achieve global excellence in, for example, the telecoms sector, we must ensure that recent take-overs such as Vodafone, Mannesmann, France Telecom, Orange, will show that European models work, cannot be blocked by hostile action or poison pills. That would be turning our back on the opportunity to achieve the competitiveness that we desire.
My delegation of Labour MEPs cannot accept, therefore, the changes in Article 9 to allow company boards the right to defensive measures to frustrate takeovers without getting shareholder approval. Mr Bolkestein himself has said that it is crucial that the management of target companies consult shareholders in this case.
Our primary objective must be to protect our investors, to ensure a fair and equal bidding process. It must be to ensure efficient flow in capital markets; and we must not end up by producing legislation which protects potentially inefficient managers and props up failing companies. That is in nobody's interest. It will result in investors not seeing the EU as an integrated capital market; it will undermine investor confidence and it will result in capital flow out of Europe.
The rapporteur's amendments create confusion in the area of litigation and it would be wrong of us to vote for confusion in potential litigation cases.
I have to say that I cannot understand Mr Lehne's approach in the British Economist, where he has himself agreed that his compromise is unworkable, but that he put it in to keep the socialists happy and he is prepared to take it out in conciliation. That is not acceptable.

Karas
Mr President, Commissioner, ladies and gentlemen, it is very important that after more than ten years of deliberations at EU level the important question of the minimum harmonisation of take-over law can be regulated by a useful framework directive, although, as Mr Lehne said, the final proposal raises a few technical problems as also problems of content and we assume that unfortunately this proposal can only be improved through the conciliation procedure. But it should be pointed out that the situation has definitely changed since the first reading. Foreign investment within the EU doubled between 1997 and 1998 and cross-border mergers and take-overs have reached record levels. Hitherto we have not had binding rules on take-overs either in Community law or in the legislation of a good number of Member States. The directive on take-over bids therefore seems necessary to ensure fair competition and for reasons of legal certainty.
I am in the fortunate position of being able to say that since 1 January 1999 Austria has had its own take-over legislation. Austrian take-over legislation, and in particular its implementation by the take-over commission, has more or less proved its worth since it entered into force. Here in the European Parliament we are chiefly concerned with finding minimum European rules to regulate the major fields of tension in take-over law, for instance the boards against the shareholders, large shareholders against small ones, companies against the stock market.
Furthermore, it is essential for the Member States to have the possibility, in accordance with the overall objectives and in the framework of the directive, to adopt useful, further-reaching rules, such as for example the provision on the promotion of equal treatment of all shareholders that we have in our current Austrian take-over law, by ...
(The President cut the speaker off)

Martin, Hans-Peter
Mr President, first I want to welcome the work Mr Lehne has done and the fact that he took up this whole job again. It is a pity the report took so long. Once again, time is running away with us in politics. It is economics that sets the pace. The reason this feels like a rather eerie debate has less to do with the time of night and even less with the sparsity of Members now present, but more with what is in fact going on. We are talking about a Europe that is supposed to unite, and what do we hear? British lobbyists against this Europe, against any hint of the social model that keeps being paraded in the electoral campaigns. It would be really nice if British Labour obviously we cannot expect anything like that from the Conservatives any more would for once move outside the borders of the City of London. Once upon a time it was said that 'Britain rules the waves', now we hear that 'Britain is drifting away'. Why are we always taken hostage for this little City of London? Why are we not honest enough to say that take-overs will become a major social problem if we do not cushion them? Why do we not dare to stand by what we keep announcing in our campaign speeches? In concrete terms we know that 70% of mergers go wrong. BMW/Rover was a disaster. Daimler/Chrysler is visibly becoming a crime, when we look at what is going on there.
Does Mr Lehne's report go far enough? No, but I do believe it is a first step in a certain direction. I personally and I wish that for once the same would apply to British Labour too will support the amendments that lead to more regulation. We do not want to see American conditions here at home. We do not need them. The European economy is doing very well. In the United Kingdom the social differences are widening ever further. We need this for insider deals, for cartel law. Does might come before right? That is the question. But the answer is that the Lehne report is at least a small step towards empowering the people of Europe.

Harbour
Mr President, it is interesting to follow Mr Martin as an English speaker and I can assure him that things are certainly not falling apart in the British economy even though my party would like a change of government. A point I want to make with regard to this takeover directive is to bring the argument very firmly back to millions of electors in my country and millions of people who have pension plans and savings that are based upon investments in the stock market. Mrs McCarthy quite rightly reminded us to declare an interest. So let me declare an interest. I have a pension fund from my previous employer. A lot of its value is based on investments in the British stock market and I rely on investment managers to keep my investment safe and to develop it for my future retirement. That, of course, is a major strength, Mr Martin, for the British economy because we have those funds there at a time when our society is growing older and we need to provide those pensions. We do not have an overhang of publicly funded pensions.
That is something that everyone in the European Union is going to have to tackle and this takeover directive, in the final form that comes through has to address that issue. The problem with the amendments that we have before us is that, if this goes through, the people who are managing my pension fund will not be able to maximise that value for me. That applies to millions of ordinary individuals working in companies up and down the United Kingdom. It is their future that we are talking about. This is not some abstract concept. It goes to the heart of the British economy and it is something that increasingly will be critical for the future of the European economy as well.

Bolkestein
Mr President, I would like to thank Parliament for the attention it is giving this proposal and for the work that the Committee on Legal Affairs and the Internal Market, and particularly the rapporteur, Mr Lehne, have carried out. This attention is certainly justified, in view of the importance of the text, which the Heads of State and Government made a priority during the European Council of Lisbon in March 2000. After all, were it to be approved, it would bring about a considerable improvement in the operation and stability of the European financial markets.
I am particularly delighted that I can at last discuss this common position, which we had a long wait for, but which was finally adopted by the Member States last June by unanimous vote.
Some of the amendments proposed by Parliament further improve the text of the Council' s common position because they highlight points that could lead to interpretation difficulties and push for speedier transposition of the directive.
Hence the Commission approves Amendments Nos 7, 14 and 18. It prizes Amendment No 18 particularly highly, the aim of which is to reduce the deadline for transposition, in accordance with a wish already expressed by the Commission on numerous occasions. Indeed, it has constantly highlighted the need to waste no time in implementing this directive, which is something all interested parties have looked forward to so much.
The Commission has also taken note of the statements brought to the fore by Amendments Nos 5 and 13. Whilst the Commission has no objection to these suggestions, it would point out that they do not belong in this directive. The current text guarantees employees appropriate information on the conditions and repercussions of the bid. Stipulations that go further in this area are not in keeping with the objectives of the directive, which relates to the protection of the share holders. The labour conditions and employee rights in the event that enterprises are restructured are provided for in other Community directives.
The Commission would also like to demonstrate its interest in Amendment No 12. This amendment seeks to introduce an instrument enabling a majority shareholder to take over the remaining securities. However, this procedure, which already exists in certain Member States, does not just affect the field of public takeover bids but extends much further and could, if necessary, be studied more closely as part of the general review of company law undertaken by the Commission. So I would suggest adding this topic to the list of subjects that could be submitted to a committee of experts.
Much to its regret, the Commission is unable to approve the other amendments, and this is for a variety of reasons. Amendments Nos 2 and 10 are unacceptable because they alter the scope of application of the directive. The directive relates to all public and exclusively public offers to purchase or exchange, be they voluntary or mandatory.
Amendments Nos 4 and 15 are unacceptable because they do not belong in the intended stipulations. These only concern holders of securities in the first case and the supervisory authority in the second.
Amendments Nos 8 and 9 are without foundation. After all, it is by no means certain that the proposed definition of equitable price is better than any other, because the various definitions that are currently in use in the Member States are all perfectly satisfactory.
Finally, the Commission studied the content of the amendments in depth but it cannot accept a single one of them. For example, Amendments Nos 6, 11 and 16 appear to pass over the existing national provisions that the text of the common position is in fact trying to bring closer together. Amendment No 6 in particular, contains an amalgam of ideas that were all addressed to a lesser or greater extent during the discussions on the directive, and were rejected because they did not seem to be suitable. Particularly the appointment of the competent authority, whilst the text of the common position came about after consultation with the supervisory authorities themselves. Then there is the definition of the percentage that confers control over the company, which ties in with other provisions in the field of company law, which differ considerably from Member State to Member State.
Amendment No 17, in its turn, should it be approved, could make it impossible for there to be any kind of hostile takeover bid. The Commission has no objection to extending the neutrality obligation to after the official deadline of the bid, as proposed in the first paragraph. However, the Commission cannot go along with Parliament' s proposal to allow the board of a particular company to determine the future of the company without taking account of the shareholders' position, by simply submitting its decisions to the judgement of the competent authorities or the judge. A solution of this kind threatens on the one hand to lead to confusion over the role of the supervisory authorities, which must remain independent and impartial, and on the other hand to the systematic institution of legal proceedings that can be time-consuming and expensive and which benefit neither the companies concerned, the members of their Boards, nor the other interested parties, and particularly the employees. The situation in the United States can teach us a thing or two on that score, and should be a warning to us to proceed more cautiously.
On a final note, may I remind you that this is a framework directive, as requested by Parliament at an earlier stage. Nevertheless, the directive stipulates firstly, that a committee of experts from the Member States and from the Commission are to supervise the implementation and application of the text, and secondly, it includes a review clause for making any changes which may prove necessary in the future.
Lastly, the Commission would point out that should this House approve the proposed amendments, it could prove very difficult for an agreement to be reached between the Council and Parliament. That said, the Commission is convinced, and it is supported in this by the economic operators involved, that the text, which is the product of over ten years of negotiations - which is longer than is needed to take account of all interests - is a good starting point, and it is high time we took action.
Finally, a further two new amendments have been tabled about which I have the following comments to make. Amendment No 19 is unacceptable, for the same reason that Amendment No 6 is unacceptable. As for Amendment No 20, which is similar to Amendment No 17, the same applies to both, albeit for slightly different reasons. The first part is acceptable, just as it is in Amendment No 17. The second part is not because the term 'Aufsichtsrat' - to use the German expression - is encompassed by the Dutch term 'bestuur' (board) and is subject to the same obligations as all managers of a company. The third part of it is unacceptable for the same reason that no so-called 'social amendments' are acceptable.
That is what I wanted to say on the issues raised by Parliament and needless to say the Commission is looking forward with enormous interest to the vote on this subject.

President
The debate is closed.
The vote will be taken tomorrow at 11.30 a.m.

Resale right
President
The next item is the recommendation for second reading (A5-0370/2000) by Mr Zimmerling, on behalf of the Committee on Legal Affairs and the Internal Market, on the common position established by the Council with a view to the adoption of a Directive of the European Parliament and of the Council on the resale right for the benefit of the author of an original work of art [7484/1/00 - C5-0422/2000 - 1996/0085(COD)].

Zimmerling
Mr President, ladies and gentlemen, the European Parliament is considering at second reading the harmonisation of artists' right of resale, thus taking up again a directive for the benefit of artists as also galleries and auction houses in Europe that has been under discussion since 1996. First I want to thank those colleagues who have assisted with this project. It was very difficult to resolve the problems in a way that was useful for those concerned. In the end we did manage to do so thanks to the goodwill of all the groups in this House, as shown in particular by the decision in the Committee on Legal Affairs and the Internal Market.
I owe special thanks to Mr Dehousse and Mr Echerer, whose many discussions helped bring about workable compromises. Right of resale is the unassignable and inalienable right of creative artists to receive a share of the profits made from the selling on of their works. As such it forms part of societal copyright protection and is the expression of the societal acknowledgement of artistic creativity. It needs to be harmonised because although it already applies in many EU states, it has not so far been recognised in the United Kingdom, the Netherlands, Ireland or Austria. That leads to considerable distortions of competition because it means that in one country an artist profits from the resale, whereas in another he gets nothing. That is not acceptable in the European market and is contrary to the requirements of the single market.
The report proposes the following specific amendments to the Council's common position. Right of resale should extend to the professional trade in works of art. The Committee on Legal Affairs and the Internal Market proposes graduating the amount of royalties to be paid by the seller on the basis of a percentage rate of 4% for the portion of the sale price up to EUR 50 000 and 1% for the portion above EUR 200 000. Moreover, the artist is assigned a right of information so that he can make his claims to royalties known to a professional art dealer during a period of up to three years, which is reasonable since the dealer has to keep the accounts of his purchases and sales. So here we must not allow a collective management firm to be involved.
The new minimum sale price of EUR 1 000 repeats a proposal the European Parliament made at first reading. Most transactions in Europe take place up to the threshold sale price of EUR 4 000 provided for in the Council's common position, so that this area needs to be harmonised now. For amounts below EUR 1 000, however, there is no need for harmonisation since this does not affect the European market and on the basis of subsidiarity no European right of resale should apply.
Furthermore, we have deleted the Council's proposed ceiling of EUR 12 500 as the highest amount of royalties an artist may receive, since there is no reason why successful artists should be penalised. In regard to the time limits for implementing this directive, on my proposal the committee decided to set a deadline of two years for each Member State to transpose it into its national law and during which the rights of the successor in title must be enforced in countries that have not hitherto recognised the right of resale.
The time limits of five and ten years wanted by the Council and in particular by the United Kingdom are unacceptable because in effect this would simply enshrine the status quo and would only benefit the art market in the United Kingdom. The reservations voiced in several quarters can be summarised in two major groups. On the one side, UK lobbyists fear job losses. However, I do not see any risk of art markets relocating to Switzerland or the USA, since the insurance and transport costs exceed the costs involved in the right of resale and make it unprofitable to relocate.
In addition, it is in the interests of both Switzerland and the USA to introduce a right of resale once we have adopted a harmonised right of resale in Europe.
The second problem concerns Austria, where groups of artists have formed who fear the directive will have adverse effects and therefore oppose it. This is based on the quite mistaken assumption that it is compulsory to involve collective management firms, as has hitherto been the case in Austria. But that is precisely what the directive does not provide. Accordingly, this matter should be put before the Austrian legislator instead of attacking the European legislator who is only creating positive framework conditions for artists and auction houses.
So I hope our UK colleagues will not show the same national tendency to block progress that we saw in Nice but that this Parliament will adopt a forward-looking European directive on the art market.

Fourtou
Mr President, 11 out of the 15 EU countries recognise the right of resale. However, it is in force only in eight countries, and this is with varying degrees of success.
The right of resale is not recognised in the legislation of Austria, the Netherlands, Ireland and the United Kingdom. Outside the European Union, neither Switzerland nor the United States recognise the right of resale.
At first sight, establishing a legislative text concerning the right of resale would seem to be justified by a desire for equity and in order to benefit creative artists. In fact, the resale right does not benefit artists, quite the contrary: it hinders the market which should be dynamic and be able to grow with a minimum of restrictions.
Consumer dynamics and sales potential are matters of concern to living artists who discern an increase in their market value and reassessment of their work. The resale right gives rise to complicated court cases, which are truly costly compared with the often modest sums involved, which generally do not reach the beneficiary. It entails additional administrative tasks, which serve to fuel criticism of European standards. It penalises the efforts of galleries who should be focussing on helping artists. It gives rise to fear, creates extra costs and administrative hassles for well-meaning potential buyers. And on occasion, it can lead to absurd situations: given that the right of resale is calculated on the basis of the resale price, in the event of depreciation transferring a work of art is more lucrative than actually creating one.
Is it therefore necessary to extend this legislative text to the countries who do not want it - I am referring here to the United Kingdom which is currently at the top of the European art market - if to do so would be to threaten their competitiveness?

Dehousse
Mr President, to repeat a felicitous expression used by GESAC (the European Association of Authors' and Composers' Societies), the draft under discussion was subjected to unjustified attacks during its review by the Council. The agreement reached by the Council is no longer an accurate reflection of the Commission' s initial proposal, which was widely supported by Parliament at its first reading.
The Socialist Group, as well as the greater part of the Committee on Legal Affairs and the Internal Market was astonished at the attitude of the Council of Ministers, whose position is unacceptable in several respects. The suggestion that transposition periods for Member States should be increased to 15 years is the least acceptable element, given that the Commission' s original proposal was four years ago. As a matter of principal, a 15-year time limit is unacceptable in such a rapidly changing world as our own. The industry will change beyond recognition in that time, mainly due to technological progress. In addition, setting this type of precedent at a time when the European Union is set to double in size would be to give out the wrong signal to candidate states. It would be better to give up the idea of a directive rather than establish such a time limit.
The Socialist Group did not therefore want Parliament to discredit itself by accepting proposals which make a mockery of the votes cast at the first reading. So we are delighted, firstly, that Mr Zimmerling, the rapporteur, understands and shares our feelings on the issue of the time limit as well as many other problems, which he detailed this evening. We are moreover delighted that almost all the democratic groups share the same constructive point of view.
Once again, the debate and the upcoming vote will be decided between those wishing to forge ahead with European integration and those who are prepared to let themselves be side-tracked by national interests (of dubious legitimacy) rather than the interests of European creative artists. It is furthermore essential that we find a common position on the matter in hand, since this is the only way that the European Union will be able to carry any weight internationally and to defend the interests of creative artists worldwide.

Thors
Mr President, Commissioner, it is difficult to understand why those who are against harmonising income tax should be in favour of this directive. Those of us in the Group of the European Liberal, Democrat and Reform Party were very critical at first reading, and we still are. We believe that there would be damaging consequences for the European market if this directive were to be implemented before international harmonisation had taken place in this legal area.
We do not believe that the deadlines for implementation should be shortened in the way proposed by the rapporteur. Nor do we believe there is proof that national minimum regulations concerning resale right are required in order to improve the internal market.
As a previous speaker said, flourishing galleries and good systems of grants are important for young artists.

Echerer
Mr President, Commissioner, ladies and gentlemen, in this dispute between all sorts of lobby groups I have always listened to what the European artists say. In my country, which does not have the right of resale, the artists are opposed to this directive. Understandably so, when you look at Austrian tradition in its home market, an internationally recognised market. I will have a hard job persuading the people in my country, but I am firmly convinced that the harmonisation of the right of resale, on the basis of the EP's proposals, will bring benefits to all concerned.
I also hope for the Commission's support, at least on one of the three major points of dispute. And I am also thinking a step ahead. In the very near future we will have to make more effort to seek a dialogue with the collective management firms, we must jointly seek simpler and more transparent structures and ensure that the administrative costs of this directive do not become absurd. Collective management firms are not just a kind of collection agency, they are very important partners for the artists of Europe when it comes to their rights. The opinions expressed on the right of resale reflect the views not of the political groups but of the Member States. I have understanding for the different cultural traditions, but at the same time I beg this House to show the same European spirit that prevailed this morning. It is not just a question of individual national artists, national gallery owners and national auction houses. It is a question of the European art market and all the players involved, and especially the European creative artists. I put my trust in the wisdom and farsightedness of this House.

Karas
Mr President, Commissioner, although as I am sure you know I am a friend of European regulations when they are necessary, and against a European bazaar for national special interests, I have promised to put the concerns felt by the platform against the introduction of the right of resale and by the art world before this House, which represents the citizens of Europe. The right of resale remains as controversial as ever. In the end, the issue is the competitiveness of the European art market, which is already finding it hard to fight off foreign competition. In my own country, the artists themselves say that they feel they are being forced into this against their will and point to Germany, where fewer than 1% of the 42 000 artists have gained from the right of resale.
The galleries, which play a crucial part in promoting young artists, are anxious and also oppose the right of resale, since it has to be applied even if a work of art is sold at a loss. The auction houses are concerned because the maximum amount of EUR 12 500 is no longer to apply. I think it is important to voice the concerns of the auction houses, the artists, the galleries, the art world of a country and a platform of artists in this debate and to take them into consideration. That has nothing to do with special national interests but contributes to an open and transparent political debate.

McCarthy
Mr President, the Commissioner will also know there was unanimous consensus in Council on the common position. I hope you are going to take as robust a position on Mr Zimmerling's amendments as you did on the Lehne report.
It is also an issue about the vitality and competitiveness of the European art market. If it was centred on Berlin I am sure that Mr Zimmerling would argue quite differently on transposition times and thresholds. Without an international droit de suite, the fact is that the European art market will go offshore. There is evidence to prove that. I too, like Mrs Echerer, must listen to artists. They are divided. There is Kûnstler gegen Folgerecht. They are divided. It is arrogant of Mr Zimmerling to dismiss the views of people for whom we claim to legislate in this Parliament. We legislate in their interests. We should listen to their views as well.
We can also see that the Folgerecht does not actually advantage many artists. In Germany, for example, in 1998, of 7 000 artists who transferred their rights, only 274 actually got any money from it and 40% of the droit de suite was taken up in costs in levying the sum. So there are some problems with how it currently operates.
I want to use this opportunity to register my dismay that the Commission has failed to provide any analysis or evaluation of the economic impact of droit de suite. It is far too important a piece of legislation for it not to have done this work. I still fail to understand how the Commission reached the arbitrary threshold of EUR 1 000 with no scientific evidence to back that up. Therefore I must plead for a long transition period to open serious negotiations on an international droit de suite, without which we will lose the European art market, wherever it is located, whether it be Paris, Berlin or London. I do not believe artists will gain from that either.

Wallis
Mr President, I try to adopt a practical approach to this issue because I have one of the biggest art auction houses outside of London in my constituency. They had raised their fears about these proposals and I went back there recently and we looked at some case studies together. We took paintings from a recent auction that would have been affected by this proposal. With one item there would have been considerable difficulty in tracing the artist's family; only tracing agents and collecting societies would have benefited. In another case, the item would undoubtedly have been sold elsewhere, i.e. in America. The one artist we were able to contact who would have benefited was not interested and said it would all be too complex to help him or his family.
I am afraid this leads me to the inevitable conclusion that we do not need this, and that without international agreement in place, it is one piece of internal market legislation that we can do without.

Inglewood
Mr President, the droit de suite is an unknown legal right in the United Kingdom and we do not believe it is a beneficial addition to our law. This is because, as has already been pointed out, many artists have recently testified it does not in fact help them. Furthermore, as experience in France shows, the main beneficiaries are the heirs of dead, rich painters, not poor, living ones. At any event, why as a matter of principle should it be right to impose a levy on the sale of a second-hand picture and not to do the same to the maker of a second-hand car or the tailor of a second-hand suit?
It is also unnecessary in the single European art market, which for years has worked quite satisfactorily without it, as has already been pointed out this evening. In short, there is no need for harmonisation of this sort in this area.
Nevertheless, we in the United Kingdom have, with misgivings and in a spirit of compromise, accepted a formula which includes its eventual introduction in the UK. It is complicated and takes years to come into effect. Cynics might say: a bit like the Treaty of Nice. But London, the centre of the art market in Europe, will disproportionately suffer if much of the trade goes off-shore to Geneva or the United States, unilaterally exporting British jobs with it, unless an international regime is put into place to eliminate global market distortion.
If the substance of the compromise is not honoured, we would rather this unnecessary directive did not reach the statute book. If it did so, it would be a great injustice, especially to those whose livelihoods depend upon the art market and, in particular, the art market in London.
I can assure the House that, if my party leader William Hague wins the general election, he will match the present Prime Minister's commitment to oppose this proposal in the essential interests of our country. It goes beyond what was agreed in the common position.

Bolkestein
Mr President, I would like to give my response to the comments made and the questions asked.
The Commission welcomes the majority of the amendments proposed by the Committee on Legal Affairs and the Internal Market and congratulates Mr Zimmerling, the rapporteur, on this dedication to achieving agreement and the way in which he has been able to gain consensus on the most important questions, particularly that of the time limit, which is, in Amendments Nos 11 and 15, brought down to four years in total, made up of a two-year transitional period and two-year transposition period. This seems to be a reasonable period to enable the profession to adapt to the change and for national authorities to introduce the necessary changes in regulations.
The second important issue is that of the total amount, which is removed in Amendment No 7. However, this amendment can be only partially approved. The Commission believes that to divide royalties into five portions, as set out in the common position, remains more effective than the proposed method, since it avoids possible loss of sales, especially in the highest portion of the sale price. The third and final issue is that of the threshold, which Amendment No 6 brings back down to EUR 1 000 or, in other words, to the Commission' s original proposal. I repeat, this amendment can be only partially approved since the Commission is not in a position to agree with you and make the threshold compulsory. The Commission believes that, on a national level, the abolition of the right to resale below this threshold cannot be justified due to the internal market. In some Member States, this may put artists at a disadvantage, in contrast to the situation prior to harmonisation. Amendment No 4 and the part of Amendment No 7 which relates to this issue should also be rejected for the same reasons.
To sum up, Mr President, the Commission is able to approve Amendments Nos 1, 2, 3, 5, 11, 12, 13, 14 and 15 and is able to approve Amendment Nos 6 and 7 only in part for the reasons mentioned previously. The Commission is able to approve Amendment No 9 as a recital and not as an article. However, the Commission is unable to approve Amendment No 4, which relates to the compulsory aspect of the threshold, or Amendment No 8, since the distinction made between heirs who are able to benefit from the right of resale is not the same as the concept of ownership of this right and arises solely from national law. A similar amendment was rejected at first reading. Furthermore, the Commission cannot accept Amendment No 10 for the reason that to draw up and maintain a list of third countries where the right of resale is in force would create practical problems and would not enhance legal security.

President
The debate is closed.
The vote will take tomorrow at 11.30 a.m.
(The sitting was closed at 12.15 a.m.)

