Resumption of the Session
President
I declare resumed the session of the European Parliament adjourned on 15 November 1996.

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

Corrie
Mr President, would you consider designating two of the lifts downstairs for Members of Parliament. The reason this House is so empty just now is because there are over 200 Members trying to get up in the lifts. Because visitors cannot get up they are using the lifts to go down to -2 and then back up again. If we had two lifts designated for Members there would be many more Members in the Chamber now.

President
I agree with you, Mr Corrie, but unfortunately that has nothing to do with the approval of the minutes.

Watson
Mr President, my point is not related to the point just raised by Mr Corrie. It refers to an event which happened somewhat earlier. Today the chairman of the Committee on Petitions received a petition from some 4 million European citizens - one of the largest petitions we have received - supporting Parliament's call for a ban on animal testing for the purpose of cosmetics. Their desire to present this petition was notified to Parliament weeks in advance. The event was organized in conjunction with Parliament's services and yet on their arrival today they encountered long delays in entering and their technicians encountered an attitude little short of hostile from some of Parliament's staff. This Parliament should be open and accessible to the people of Europe and this kind of event should be encouraged. Would you order an investigation into the events surrounding today and find out why it was so difficult for the animal-testing protesters to gain access to this building.

President
I shall look into the matter, Mr Watson.

Newman
Mr President, thank you for agreeing to look into that. I also wanted to say that a few minutes ago Parliament received a petition signed by the largest number of people ever. Over 4 million European Union citizens from all fifteen European Union Member States signed this petition which supports the European Parliament in calling for a ban on animal testing for cosmetics. I know you will want to note that and the Committee on Petitions will be looking very seriously at this petition.
(Parliament approved the Minutes)

Chanterie
Mr President, when I came into the building I was handed a document 'Parking survey D3' which bore an address in Brussels and which requested my cooperation in the survey. I wanted to ask you, Mr President, if this survey is being carried out with the Bureau's permission? Are we expected to make a useful contribution or are we not expected to make a useful contribution? That is what I would like to know.

President
Mr Chanterie, I can't just answer that off the cuff - please let me have a copy of the survey and we'll look into it. I do need to see what it's all about.

Urgent political matters
President
The next item is the communication from the Commission on urgent political subjects of major importance.
I propose that, as an exception, today's question time should be divided into two blocks of 30 minutes each: the first part deals with the situation in the Great Lakes region of Africa and the second with the disruption of the free movement of goods and persons in the road haulage sector in the European Union.

Pinheiro
Mr President, over the last couple of weeks the world has witnessed dramatic developments in the Great Lakes region which have created new and tremendous humanitarian political challenges: the massive return of refugees from Eastern Zaire to Rwanda within a few days but also the dispersion of hundreds of thousands of refugees and displaced people in Eastern Zaire creating a dangerous new potential for destabilization.
The defeat of the Zairean army was a severe blow for Kinshasa. The government and the transitional parliament are deeply divided over the question of how to deal with the crisis in Eastern Zaire while the rebels and their allies are gaining ground very rapidly. The fighting in Kivu has severe repercussions on Burundi where fighting and human rights violations have intensified in various parts of the country and Tanzania which is now hosting the largest refugee population in the Great Lakes region. There is also an urgent need for a fundamental reappraisal of the political situation.
I proposed to the Development and General Affairs Council a plan of action for European Union assistance to the Great Lakes region which we hope will provide a comprehensive framework for all relevant humanitarian, political and development issues. These include the following: emergency and relief efforts, the reintegration of refugees and displaced people, social and economic rehabilitation, reconstruction of independent and equitable justice systems, rebuilding or reinforcement of administrative structures and constitutional institutions and regional peacebuilding efforts.
A taskforce of DG VIII is working out the details of this plan after an assessment mission to the region in coordination with ECHO and the special envoy, and taking into account regional and international peace-building efforts as well as the activities of other donors. This plan will, of course, be adapted according to new developments in the region but the basic assumptions will, however, remain relevant. We have to acknowledge that we are facing an intricate set of problems with military, political and socio-economic aspects.
These aspects are present in some form or other in all the countries concerned but not with equal intensity and we will have to focus the priorities in each country. In Rwanda the priority is the successful reintegration of the returnees into Rwandan society. Beyond the immediate humanitarian urgency this is also crucial for the political future of the country and for social peace between the ethnic communities. Human rights and the rapid establishment of a functioning and equitable justice system will be essential in this respect.
In Zaire there is an urgent need in addition to the delivery of humanitarian aid to populations in distress to defuse the tension in and around Kivu in order to avoid protracted civil war. It is still unclear what the role of a multinational force could be in this respect since the military situation has become much more complicated. Nonetheless it is essential that all political forces engage rapidly in peace negotiations.
In Burundi ways and means have to be found to avert a further intensification of fighting and to revitalize the political dialogue. The common position of the countries of the region in the next meeting of the Arusha process scheduled for early December in Congo will be crucial to oblige the Burundian political forces to engage in longawaited negotiations. The Arusha process has been the most important forum addressing the conflicts in the region and this process could be turned into permanent conference mechanisms for central and eastern Africa. This could clear the way for the conference on peace, security and development in the Great Lakes region. This conference should be convened as soon as the main obstacles are overcome, that is to say when all countries agree to a multiple process of conflict management and subscribe to a number of principles which are essential to achieve lasting peace in the Great Lakes regions.
These are seven principles: respect for the frontiers and the territorial integrity of all countries involved; respect for international humanitarian law with regard to refugees and displaced people; effective protection of minorities and their civic rights; respect for human rights and the rule of law and the re-establishment of functioning and equitable justice systems; condemnation and effective legal prosecution of ethnic discrimination, ethnicist propaganda and all kinds of activities inspired by ethnic hatred; respect for democratic principles and constitutional order; establishment of a regional framework for economic cooperation in global coordination of rehabilitation.
In my opinion the conference should not only produce a multilateral peace agreement but it should also be a forum for discussing the required international assistance to consolidate such an agreement and to implement its decisions. The conference would thus become the cornerstone of a peace strategy linking the regional efforts and commitments of the international community.
You might ask why I have not referred to the situation of refugees. Let me be quite clear, humanitarian assistance in Eastern Zaire will not be possible unless military security is given to the NGOs and humanitarian agencies in the field. Unfortunately this has not yet been solved at UN security level, nor has it been solved at Council level in the European Union.

Aelvoet
I would like to put the following question to the Commissioner. If a decision on sending an intervention force is not made within the next few days then it will be too late. We are now being told that there is no agreement on that in the Council. I want to know if anything can be done so that an initiative is taken at least at Council level in conjunction with the OAU which has made it clear it wants to do something by way of an intervention force.
My second specific question is: when is the Commission going to do what it promised five years ago, namely compile an arms register. The problem with arms supplies to both sides, both the Hutus and the Tutsis, is that it means that this war is solely being waged with arms and not with political arguments.
And my last question is what decisions have been taken by the Commission or the Council on sending a sufficient number of observers to Rwanda to ensure that reintegration does not lead to the silent extinction of returning refugees.

Pinheiro
It is difficult to assess in full the current number of refugees in Eastern Zaire. The reports from the World Food Programme indicated some weeks ago that it is in the range of 700, 000. Later reports claimed it was much less, in the order of 250, 000. Whatever the true number, it is a staggering amount. We cannot ask our NGOs to go to places where the military say they will not be safe. If it is unsafe for the military it cannot be safe for NGOs. One thing is sure: the situation in Zaire is far from being secure and therefore it will be extremely difficult to ask NGOs to go.
Pressure should be made at Security Council level for this deployment to be carried out as soon as possible in some parts of Eastern Zaire. The Commission is trying to address the plan in a way which will not give the idea that the situation is solved - far from it. That is the reason why in early December we will present this broad plan regarding humanitarian, political and rehabilitation issues. I hope everyone will then take up his responsibilities.
With regard to human rights, it is absolutely essential that observers go as soon as possible and increase the numbers over there. We are in contact with both the UNHCR and the United Nations agencies for human rights in order to help them deploy significantly increased numbers of human rights observers both in Rwanda and in Burundi. In Rwanda we hope to have approximately 300 shortly and in Burundi something of the order of 170. On top of that Member States are willing to send some observers. The only thing the Council and the Commission asked is for people who are going to be adequately prepared so they can be of help rather than making things more difficult.
With regard to arms deliveries, there has been some movement on the UN side. As far as I could ascertain, some private research that was done by, among others, CNN has quite definitely proven that there have been illegal arms deliveries to the former Rwandan army and others throughout the embargo. I cannot go further than that at this stage but I will inform you when I have more information.

Andrews
I thank the Commissioner for his statement. I would like to pursue this matter of the supply of arms to the Hutus. The Hutus were defeated by the Tutsis and disarmed a year ago and now they seem to be rearmed. As you know, Commissioner, there is information that these weapons are coming from European Union Member States and it seems immoral that this should be allowed to continue. What are you going to do about it?
Concerning the multinational force, it seems that Canada is perfectly willing to lead such a force but someone is blocking it. Can you say who is blocking the multinational force which would be prepared to move into the region as a matter of urgency, as you suggested? Furthermore, what is the Commission doing about monitoring the returnees into Rwanda when they reach their villages?
Finally, there are approximately 600, 000 refugees missing in the region. It is unbelievable that we cannot identify exactly where they are so that we can assist them. The NGOs know where they are and there is no reason why we should not have the information.

Pinheiro
As you know, unfortunately in international diplomacy it is very rare that someone puts things as straightforwardly as you would like. No country is openly blocking it but there are some countries - and I would mention among others, France, Italy and Spain - which are pushing for decisive and urgent action on the military side, while others are more hesitant and want more clarification before committing themselves.
Regarding the monitoring of returnees, a team from DG VIII were assessing the situation in Rwanda last week so that immediate assistance can be provided, namely shelter and help in sorting out some problems caused by the influx. The main problem now is not food or medicaments but it is basically shelter and trying to find some ways of earning a living in the months to come.
With regard to the 600, 000 who are missing, it is very difficult to make an assessment. The figures given range from 250, 000 and 750, 000 but whatever the true number, it is amazing. I would add that there is another problem to which we have not paid so much attention. I refer to the huge number of refugees in Tanzania now in the range of 700, 000. I put it to you that things are not easy at the border between Burundi and Tanzania and unless the international community acts quickly we might witness there something of a repetition of what occurred at the Zairean/Rwandan border. That is one of the reasons why the Commission is willing to put this plan forward to make everyone aware of the current dangers on top of the ones we are already acquainted with.

André-Léonard
Mr President, hitherto we have been deploring the inability of the international organizations to get a neutral multinational force into the field. Today, the arguments about the numbers of refugees still remaining in the area are more heated than ever. So there is a more and more urgent need for action, because otherwise death will put an end to the problem. Those European States that are members of the Security Council have proved incapable of instigating the debate and defining a European position capable of breaking the deadlock on the Security Council. Don't you think that Europe has a unique opportunity here to show that it does exist?
I should also like to mention the problem of aid to the refugees and those repatriated to Rwanda. As you know, Rwanda is still refusing to accept humanitarian aid or do anything to control the return of the refugees. This attitude is unacceptable in the present situation. Could the European Union not use its influence to persuade Rwanda to change its attitude?
Finally, I should like to know what our diplomatic position is in Burundi. We know there has been a coup d'état there, and apparently we are negotiating with Mr Buyaya. What's going on, Mr President?

Pinheiro
Regarding the multinational force, among other things we have proposed a contribution by the European Union through the Commission budget so that the Africans could have through the Trust Fund of the UN Security Council the possibility of participating in the multinational force. Unfortunately, from the humanitarian point of view, this is led by the UN and therefore the European Union can apply pressure but cannot replace the United Nations in that role.
With regard to Rwanda, so far the Rwandan authorities have been cooperating very well with UN agencies and with the resettlement of refugees. Despite minor incidents, the global picture is very encouraging. In Burundi we are approaching the problem through the Arusha regional group, in other words, through the points that have been agreed upon by the states of the region. Therefore, we have been careful not to legitimize a government which the countries in the region do not recognize as legitimate. In that regard I should like also to stress that the delegation of the European Union will be reopening in Burundi very shortly. I hope this week.

Sauquillo Pérez del Arco
I would like to thank the Commissioner for his answer. One of the questions was: what is standing in the way of the Council sending in a military force?
The second question is: what measures is it taking, vis-à-vis the Rwandan Government, to support and assist the humanitarian organizations that are there, given that some of them are not being given the legal status they need in order to act?
And the third question: you spoke about the conference on peace in the region. This House has been calling for such a conference for some time and has given its approval in resolutions. When do you think it will be possible for the conference to take place?

Pinheiro
The Council does not have the power to decide but it has the power to approve declarations and to put pressure on those who have to decide. Unfortunately the conclusions of the Council were not as strong as many hoped for. Therefore the matter is again before the UN in New York with no precise date for the deployment of the military force.
Besides what I have already said about Rwanda, I should like to emphasize that the Commission has made available all the funds it could at this stage - both through NGOs and UN agencies - in order to make things work down there as much as possible. So far the Rwandan authorities have been very cooperative in many ways and I am encouraged by that. I hope it will continue in the future.
As to the peace conference, it should be convened as soon as possible. Not only do the problems of some countries in the region need this conference but the whole situation is so complex it is impossible to deal with it in a bilateral way. Only a peace conference under the aegis of the United Nations could make a tentative start to improving the situation. I would say bluntly that if we do not achieve some peace-building through this conference we might witness a regional war involving many countries in the region including others which so far have not been involved in this conflict. Needless to say, an implosion in Zaire will have major consequences not only in the Great Lakes region but in many other countries which border on Zaire. That is one of the reasons why we need to address the political situation urgently and the special envoy is doing magnificent job in the region. He is one of the few interlocutors whom everybody will talk to. It is not easy but we should try and I hope in early December I will be able to tell you what we propose.

Günther
Mr President, there are three questions I would like to put to the Commission on this subject. First, the principle was supported that refugees should only return voluntarily. Might some of this escalation possibly have been avoided if rather more emphasis had been placed on the return of the refugees? Secondly, the question of the observers. Is it not a little late in the day to send observers after disaster has already struck? Because if the non-governmental organizations have virtually no room for manoeuvre because of the unstable situation, is not that even more the case as far as any observers are concerned, however many of them there might be? My third question relates to the conference you mentioned. Your seven principles are certainly highly ambitious. Why have such conferences not worked in the past? Questions relating to the protection of ethnic minorities and their legal position, respect for frontiers, these are precisely the things that are not in place, and of course they are to a large extent the reason for the present escalation. Are you thinking just about a conference under the auspices of the United Nations, or is the OAU also to be involved?

Pinheiro
The only alternative to the voluntary return of refugees is to point a gun at them and say: ' Either you go or you will be killed, either by the gun or by withholding shelter, food and water' . The only acceptable way is the voluntary return of refugees.
We had human rights observers there. The problem is that security was so bad that the observers had to leave the area. We cannot ask the observers - who are civilians and sometimes volunteers - to submit to a situation which is highly insecure and in which they may be killed. Therefore we could not ask the observers to remain even if that is what we wanted. At present observers could be deployed safely in Rwanda and in some parts of Burundi but in Eastern Zaire it is simply not possible. The security situation does not allow it just as it does not allow NGOs to be there.
With regard to the conference, it takes two to tango. The two conflicting sides have to agree to sit around the table. Otherwise it has no meaning. So far there has been a conference of the regional states but we want to go further and have everyone sit around the table. The aegis of the United Nations has been claimed from the beginning but this does not mean that the Organization of African Unity or the European Union which, by the same token, is by far the largest provider of humanitarian and rehabilitation assistance in the region will not be present. I hope we will and that we can make a contribution when it is convened.

Kinnock, Glenys
I have two questions about Rwanda. The first relates to the particular problems facing women returning to Rwanda. 70 % of the population of Rwanda currently are women. Many of the returnees are women, many of whom are widows or single mothers stigmatized because of that. Under Rwandan law they have no rights to property or inheritance. What will the European Commission be doing to ensure women's rights to property, shelter and proper protection when they return to Rwanda?
Secondly, you will be aware, Commissioner, that one of the important things we need to ensure is that people in Rwanda have a sense that they are returning to a country that will deliver justice. One aspect will be that we ensure proper trials for those guilty of genocide. How will we be protecting, ensuring and supporting the Rwandan Government's case for beginning those trials in January? It will be absolutely essential after the genocide laws have been passed that the trials begin in January. What will you be doing to ensure that those two things occur?

Pinheiro
This is a most pertinent question. We have been in contact with the High Commission for Refugees as well as the High Commission for Human Rights of the United Nations in order to guarantee and make sure that women and children have special treatment and special attention in Rwanda. I can assure you that earlier today I received a letter from both organizations guaranteeing it will be taken care of as a matter of the utmost urgency.
With regard to justice, the Rwandan Government has passed the laws which enable justice to be done. It was not easy for them. But the logistical means needed to enforce the trials etc. are not there. This is one of the topics which the Commission assessment mission in Rwanda last week had as its mandate. I very much hope that we will be able to provide some means so that by January, which is also our target, we could have and witness justice being done in Rwanda at a reasonable pace.

President
Thank you very much, Commissioner.

President
That brings us to the second part of the debate on urgent political subjects of major importance: the disruption of free movement of goods and persons in the road haulage sector. I give the floor to Commissioner Kinnock.

Kinnock, Neil
I should like to express my gratitude to the Committee on Transport and Tourism and its chairman Mr Cornelissen for providing me with this opportunity to make a statement to the House about the damaging and continuing dispute in the road haulage sector in France. The Commission naturally shares the widespread concern about events which are clearly having grave economic and social consequences both inside and outside the country.
Obviously such a dispute with something like 200 blockades throughout France causes hardship and distress both to those directly involved and to many of the innocent victims of the dispute. Indeed, there have been reports of physical violence and that particularly is to be condemned. The Commission naturally hopes that all involved - workers, employers and the French authorities will do everything in their power to achieve a speedy and lasting resolution of the dispute and to alleviate the hardship that is being suffered by those who are not direct participants.
As the House will know, both President Santer and myself, on behalf of the Commission, have called upon the French authorities to act urgently to remedy the situation and to ensure that the Treaty provisions relating to freedom of movement in the single market are fully respected. As the House will also know, however, in practice the Commission has no effective legal right or ability to intervene in a national dispute unless a Member State is shown to be negligent in its duty to uphold the legal freedom of movement of goods and persons specified by the Treaty. That is a plain reality. It is certainly not an alibi for a passive attitude. It is a fact of life and a fact of law.
It is worth noting that some who have been loudest in their demands that the Commission intervene to prevent or to end such disputes would be amongst the first people to express even louder outrage if power was ever given to the European Commission to supersede national authorities, national conduct and national decisions in such circumstances.
Of course none of that would excuse inactivity when so many Community citizens and businesses from all Member States are being affected by a dispute in one Member State. I, my cabinet and services have consequently taken what action we can and taken it consistently. Last Thursday evening I met the Secretary of State for Transport with responsibility for the road haulage sector in Paris. She was obviously already very strongly focused on the issue. On Friday I followed that meeting with a letter to her to express my concerns at the developments in France, urging her to continue to work towards solving the issue. As the House would expect, the Commission is also maintaining close and continuing interest and contact with the French authorities on the course of the dispute.
The efforts of the French Government to secure a negotiated end to the dispute are being sustained with the appointment of a mediator and with a series of lengthy meetings between the parties involved. The last one broke up in the early hours of this morning and the next one is due to meet in about quarter of an hour's time in Paris. I understand that some progress with retirement commissions for workers in the haulage sector has been achieved and that is to be welcomed although there are clearly vital and basic matters of substance that are not yet resolved. The number of non-French trucks blocked last weekend was about 20, 000. That had been reduced to 5, 000 by Monday but, sadly, that number has risen again in the last 48 hours. Despite this the French authorities have been able to secure the release of another 150 British, Spanish and Portuguese lorries.
The 200 blockades mean however that there has not been significant easing of the overall situation. Most of the issues which give rise to the dispute are obviously a matter solely for the employers, the employees and the French authorities to resolve. Some of the issues such as driving hours, rest periods and working time are issues on which there is relevant Community legislation or on which proposals have been made. On driving and rest periods there are claims by drivers that some employers are not respecting the existing legislation. Obviously I am not in a position to make a final judgment on that at this stage but naturally the Commission has a desire and the duty to try to ensure that all Community and national legislation is properly enforced and fully respected.
We have taken a number of actions to assist with this. One is the proposal for a new tachograph which will make it easier to check driving hours accurately and to make falsification much more difficult. I am hopeful that the Transport Ministers Council which meets early next month will make significant progress on this proposal in order to reach a common position under the Dutch presidency in the early part of next year.
There have been previous relevant actions. In 1995 the Commission convened a meeting with national administrations to promote cooperation between Member States in improving interpretation and enforcement of driving hours' legislation. Obviously we report on the application of legislation. On working time more directly and generally, the House will know that the transport sector is excluded from the existing working hours' directive. The Commission has constantly said that appropriate provisions should be established for the excluded sectors, whilst recognizing their specific characteristics.
On the basis of some recent progress in the joint transport committees between employers and employees, the Commission will be publishing a White Paper on the excluded sectors and we believe that progress may be possible with non-mobile workers in the transport sector. As far as mobile workers such as truck drivers are concerned, as the House may know, the prospects of progress are much slower and much less evident.
In the general concern relating to the dispute, the issue of compensation has naturally been raised. I have to advise the House that the Commission has no legal power to intervene on this specific issue since there is no general Community law which covers the right to compensation for individuals or companies which have been affected by strike action, nor is it likely that there ever will be such law at Community level. However, Member States have set up compensation schemes in specific cases in response to concerns expressed at national and Community level. I note therefore the reports that the French authorities have said that they will take steps to compensate foreign drivers and that local préfectures can provide compensation claim forms.
In conclusion, it will be evident to the House that in democratic societies the right to withhold labour is a basic civil liberty and while some Member States specifically recognize that in their laws and their constitutions, the protocol on social policy annexed to the Treaty excludes Community legal competence with regard to the right to strike. Consequently there is no Community law or Community rules relating to strikes. It will be evident to this House and to all other parliaments of the Union that the right to strike must of course be exercised with proper respect for the law and that includes the obligation to maintain the free movement of goods, services and people in the single market, in the European Community. It is this aspect in particular which is the matter of focused attention by the Commission, although naturally we are among the many people right across the Union who hope that the reports that the dispute may be resolved by the coming weekend turn out to be correct.
(Applause)
Rocard
Mr President, Commissioner, I absolutely agree with you that this is a totally private dispute and nothing to do with the public authority. The ineptitude of the French Government has been confined to taking too long to choose a mediator, and also taking too long to do something about the economic conditions under which the haulage sector operates, conditions which drive people to disregard the safety rules.
What remains for us is to consider the problem of working conditions in that profession which, in France, is one of the last bastions of an extremely archaic, not to say feudal, attitude by employers. All this is highly surprising. The average working week for the road haulage profession in France is 62.5 hours.
Commissioner, my question is this: don't you think there is scope for the European Union to try, by means of a directive, to harmonize safety conditions in road haulage throughout the Union? That is all I have to ask.

Kinnock, Neil
I am grateful to Mr Rocard. As he will know, the Commission has constantly striven to try to ensure that there are equitable conditions right across the Community, particularly in respect of fair conditions of competition and of civilized conditions of work. He will be familiar with the difficulties encountered in many areas of occupation and that certainly applies to the transport sector, including road transport.
The Commission cannot offer a view about the quality or otherwise of conditions in the French haulage sector. However, I believe that if there was a reappraisal of the general requirements relating to fair competition and civilized working conditions it is conceivable that some of the issues said to lie at the root of this dispute could over time be eased to the benefit of all.

Paisley
I welcome what the Commissioner has said but I should like him to remember especially those parts of the Union that are on the periphery such as Northern Ireland. Some of the trucks from my country have been held up into the second week. I welcome what he has said and the representations he has made. But this is very urgent for those on the periphery of the Union.

Kinnock, Neil
I am grateful to the honourable Member. I am sure he will understand that to the degree we can bring political influence to bear, we will certainly do it, not least because we understand the great social and personal distress being encountered by a large number of truck drivers and their families and the disadvantages caused to all parts of the European Community's economy, notably the peripheral areas, as a consequence of a dispute of this kind.

Wijsenbeek
With due respect to the Commissioner, there are a few aspects of what he has just been saying that I should like to contest. First, on the tachograph, it was the Commission that originally proposed something which did not take account of the most modern technology, namely the computer. Second, as a Parliament we have been requesting for years new proposals on driving and resting hours including working time proposals. To date the Commission has not come up with new proposals. Finally, it may well be that the Commission rightly takes on the freedom of movement but it is clear that this is causing extreme damage to drivers and road hauliers from all over the Community and that the control on the application of driving and resting hours is lagging far behind. We have just received the figures for 1991 and 1992. We still do not have them for 1993 and 1994 and we know that some Member States do not even hand them in.

Kinnock, Neil
When the honourable Member uses the terms 'with due respect' , generally speaking I take cover. I see that my experience of his wit and wisdom is well-founded and I could have anticipated the kind of question which he rightly raises.
So far as the tachograph is concerned, because of his intimate and active acquaintance with this particular issue, he will know that what the Commission has been trying to do for a very considerable time is not to achieve perfection, which we would like, but to maximize the amount of progress that could be made in eradicating falsification and in upholding decent conditions. We now have the prospect of getting the application of advanced electronic technology to the tachograph and I very warmly welcome that. He will be aware of the fact that on previous occasions, it has not been easy even to get the kind of consensus necessary for even more modest changes which would have the outcome that both he and I very strongly desire.
Much the same applies to the question of working time. He and I are at one in our desire to ensure that there are fair competitive conditions and that there are civilized working conditions. The fault for not securing progress in that respect is certainly not that of the Commission. As Mr Wijsenbeek knows, it is the legal duty and power of the Commission to propose. It is the right of the democratic representatives of the Member States to dispose. If on previous occasions they have chosen not to dispose in the direction of significant change in working time in the transport sectors, I can hardly be held responsible for that. What I will do, however, together with representatives from Parliament and some Member States is to continue to strive for progressive change that would increase efficiency and competitiveness whilst sustaining decent conditions.

McIntosh
Some of us might be tempted to come in wearing swimming costumes in order to catch your eye in future.
While we accept that Commissioner Kinnock has acted urgently, he has given us two reasons why the Commission, as guardian of the Treaties, has two grounds on which it can take action against the French Government. These are on negligence. The first is negligence by the French Government in failing to implement the drivers' hours regulations. The second is negligence by the French Government for failing to uphold the fundamental Treaty provisions on free movement.
On the matter of compensation, fresh foods, perishable products and even live animals have been delayed for over eight days. They might perish and compensation must be paid. We have the right to petition the Commission on constituents' behalf to take action for compensation. Will he take these actions up on our behalf?

Kinnock, Neil
I am grateful to the honourable lady. I pay no attention whatsoever to the remarks she makes in respect of swimming costumes. That might further complicate an already complex set of issues.
On the matter of compensation, I regret that I have nothing to add to the clear statement I made earlier both in terms of the general nature of Community law and in terms of the readiness of the French authorities to establish procedures to enable people who have been damaged as a consequence of this dispute to make appropriate claims through the offices of local préfectures . They are at liberty to gain the appropriate forms which are currently available and to process their claims accordingly. That is the current legal reality and there is nothing at this stage that I am capable of adding to that.
So far as the alleged failure of the French authorities to fulfil their responsibilities under Community law is concerned, on the driving hours regulations that will bear further consideration. At this stage I must say that there would be difficulty in demonstrating satisfactorily that the weaknesses are a consequence of negligence in any legal sense by the French Government. We are constantly willing to monitor and to examine these conditions.
As far as fundamental Treaty obligations of guaranteeing the freedom of movement of goods and people is concerned, the Commission is willing as on previous occasions to act using our powers under the Treaty in the event of negligence being apparent on the part of a Member State. In the days of this dispute the readiness of the French authorities to appoint the mediator and to be active in meetings that have lasted up to 12 and 14 hours does not give satisfactory evidence of negligence or of the lack of will to try to maintain the freedom of movement. Consequently, while we will continue to observe closely the whole set of events with a view, if necessary, to pursuing cases related to negligence, there is no evidence that would justify that course of action at this juncture.

Colom i Naval
Mr President, I firstly have to express my regret that the group of visitors I invited are not among our spectators today as their journey here has been held up on French roads.
Secondly, the Commissioner spoke very clearly regarding the lack of potential compensation for damages suffered already by lorries held up on French territory. In the Spanish case, losses amount to something in the region of 250 million ecus in terms of perishable goods. My question, however, is this: what is being done regarding, for example, the harvesting of citrus fruits in the Mediterranean basin? The industry is at a complete standstill whilst we await a solution to this dispute, which has caused the loss of many working hours and an increase in unemployment. What is being done about the slowing-down in the rate of work in Spain's ports on the Mediterranean which are currently unable to export to the Community goods arriving from third countries? Is this yet another area where the Community is not going to intervene?

Kinnock, Neil
I fully recognize the grievous conditions to which Mr Colom i Naval draws attention. Indeed, the great concern he is expressing is shared very generally in the Community and representations have been made by a very large number of bodies both in the professions and from families and from national governments. The fact remains that whilst we acknowledge with deep regret that there will be very great and lasting loss as a consequence of a dispute of this nature, we are not at the juncture where there can be effective or realistic legal intervention by the Commission to try to prevent or repair damage. I know that he will understand that in some respects one is bound to feel like any other normal citizen a sense of frustration in these circumstances. But these are the realities. I would be misrepresenting the reality to this Parliament if I were to pretend otherwise.
I emphasize that if it is justifiable to take action which will have the desired effect of bringing a damaging dispute to a conclusion the Commission is as ever ready to take that action. The justification at this juncture for pursuing that course is not evident.

Cohn-Bendit
Mr President, Commissioner, with all my customary disrespect for institutions, there are two things I would like to say to you. The problem has nothing to do with freedom of movement - it is the problem of social Europe. I believe that Europe and the Commissioners are too timid. They should jump at the opportunity and make the point that, without a social Europe, this kind of problem does arise, because it is a problem of harmonization of labour law and it is also a problem of public health protection.
The more miles the trucks cover, the more dangerous the roads are. The more the Commission - or Europe - proves unable to protect its citizens, the more danger there is for all of us. And, thirdly, I would like to say to all Members, to everyone who tries to speak in this House about freedom of movement: all social change comes through strikes, and when there is a strike, social change takes place. That is why the Commission should thank the strikers - because they are advancing the cause of social Europe.

Kinnock, Neil
I can say fairly on my behalf and probably on yours, Mr President, that we need no instruction from the honourable Member about the justification, history or nature of strike action. I would also say to him that he would have difficulty in demonstrating in the course of history that social change of a progressive and productive kind has only come as the result of strikes. Respect for the development of the law is as vital to ensuring the right and privileges of people in a free society, as I am sure the honourable Member will readily acknowledge in a sober moment.
I would say to him further that when he says to us that this is not a problem of freedom of movement but of social Europe I understand the implication of what he is saying and I am not without sympathy for that view, as he will understand. However, he tells us that where there are trucks there are dangers and as long as we have as many trucks there will be dangers. As Transport Commissioner, I can understand the implication of that too. But I am not sure that in his efforts to uphold the social interests of those engaged in this dispute he would carry their full sympathy if what he was arguing for is fewer trucks on the roads of France.

Killilea
I thank the Commissioner for his statement. He said that he had made a certain amount of progress in freeing a certain number of commercial vehicles in particular from Spain and Britain. I did not hear him mention the island of Ireland. There are quite a lot of Irish vehicles locked with perishable goods, mostly lamb and beef, in refrigerated trucks which now for twelve to fourteen days have been surviving on a small amount of diesel to keep the refrigerators going. Could the Commissioner inform me if he has made representations, or if he still can make representations, to take those perishable cargoes out of the system as quickly as possible so that they will not be lost, particularly taking into account the enormous costs involved in the consignments I have mentioned. And also taking into account that Ireland is totally dependent on the export of our both lamb and beef.

Kinnock, Neil
I would assure the honourable Member that, as I indicated earlier, I am acutely aware of the impact of this dispute on all parts of the Union but in particular those parts which are at the periphery. Naturally that has great implications for Ireland. My mention of the United Kingdom, Spain and Portugal arose simply because of my desire to report accurately on the most recent releases. It does not in any sense indicate a casual attitude towards the nationals and businesses of any other Member State or, indeed, of those who come from beyond the borders of our Community.
As the honourable Member indicates, the damage is already significant. So far as representations are concerned, the French Government has made persistent efforts with some modest success to secure releases and from what I understand they are putting emphasis on those loads that carry perishable cargoes which are in particular jeopardy for all the obvious reasons. There are restraints on the degree to which they can act but I am assured that they are making efforts.
The honourable Member may share my feelings about good news. I have been informed by the European transport trade unions that because of their intervention the United Kingdom hauliers blocked in Calais have just been released due to an intervention by the unions and I hope that kind of intervention will have wider effects on the nationals and the businesses of other countries.

Cornelissen
Mr President, I would like to thank the Commissioner for his explanation and for his efforts. It is not the first time, nor I fear is it the last time, that roads are blocked in order to exert pressure on negotiators in a labour dispute. I would like to ask the Commission to examine ways of creating a legal instrument to guarantee free flow of traffic on Europe's main routes. I would refer you to Dutch legislation in which summary proceedings can be used to ask an independent judge to rule on the legality of actions.
My second question is whether the Commission would request temporary use of red diesel to enable lorries outside the blockades to leave France. Mr President, there are two sides to every coin. The indispensability of road haulage has been clearly proved in this issue.

Kinnock, Neil
I am grateful for the question. I share the honourable Member's great anxiety and, as I said earlier, I was very glad to be given the opportunity by him and by his colleagues to make the statement. The purpose of undertaking strike action of the kind being followed in France is self-evident but to try to develop a Community law that is comparable to the Dutch practice would be extremely difficult.
I do not even put into question the value of such a law or the principles involved into it. I would simply say that whilst in the Netherlands the decisions of the Dutch Parliament and Government in relation to a sort of automatic injunction in certain specific circumstances could be respected within the borders of that sovereign territory. The likelihood of the European Community giving powers to the Commission or to the Court of Justice to be able to apply that principle across the Community is extremely remote.
When we are in the situation, as happens at regular intervals, of individual Member States resisting even the judgments made by the Court of Justice in the course of the law that already exists, no matter how extensive their frustrations - and I certainly understand that - will come to recognize that the proposition being made is unlikely to have practical effects or secure general agreement in the institutions of the Community.

Swoboda
Mr President, Commissioner, I hope your helicopter flight over the Tyrol gave you a good impression of heavy goods traffic in that region. But that's by the way. My two short questions are as follows: first, you were annoyed by what Mr Cohn-Bendit had to say, and I can understand that. But should not the situation in France prompt the Commission to make it clear to the Council just how important social dialogue in Europe is? The only way to avoid such fundamental problems and strikes is for the social dialogue to become a basic principle! Secondly, Commissioner, I would also like to ask you to state clearly in this House - because it will set a good example for the procedure on the rail White Paper, and we had a demonstration here just recently - that you will enter into early discussions with the trade unions.

Kinnock, Neil
I am grateful to the honourable Member. The last part of the question is not strictly relevant to the question raised by the Committee on Transport and Tourism. Therefore, Mr President, I accept your injunction to focus entirely on issues relating to the road haulage dispute in France, although it is true to say that the general consultation and discussions on the rail White Paper will be continuing and be very extensive involving all the social partners.
As far as the situation in France is concerned, I miss no opportunity with my colleagues in the Transport Council and elsewhere to emphasize the value of what the honourable Member describes and is generally understood to be the social dialogue. Guarantees of the kind that could develop out of that are an important contribution to the maintenance of industrial peace on a satisfactory basis which involves none of the parties in the surrender of fundamental requirements and basic rights. I can do that, however, as much as I like.
My fundamental concern at this moment is the resolution of a specific dispute. It may be that a different level of social dialogue could have contributed to getting rid of the causes of disputes like this. However, what I want at this juncture is to ensure that Parliament, like the Commission and everyone else, is focused on the efforts being undertaken to try to bring this particular dispute to a satisfactory and long-lasting conclusion.

Camisón Asensio
Mr President, as the Commissioner explained a moment ago, serious problems have arisen not only in France but also in neighbouring countries. We are concerned about the news we are receiving from Spain in this connection: losses of 1, 000 million in terms of fruit and vegetables in Alicante and 5, 000 million in Almeria; the citrus-fruit harvest is at a standstill in Castellón and, in Portugal, the textile and car industries are on the verge of collapse, etc.
Commissioner, it is not my intention to harp on about the dispute's prospects, because you have already gone into this, nor about what the Commission is doing. However, I do have one very specific question for you: do you have any news to the effect that attitudes in the dispute could harden even further in the light of the announcement of a French air-traffic controllers' strike? My reason for asking this, Commissioner, is that some Spanish fruit-andvegetable hauliers were already using air transport as an alternative to road transport.

Kinnock, Neil
I share the deep concern made evident by the honourable Member and by other honourable Members who have raised questions and those who have not. Any sensible person is going to be deeply worried about the effects of the strike not only in the short term but in the longer term, especially amongst those who rely on road haulage to carry their produce.
So far as other disputes are concerned, it would be unwise of me to try to comment at this juncture on speculation about the extension of the dispute into other transport sectors or other countries. I have heard during the course of the day, for instance, that a Danish transport dispute is in some way related to what is going on in France. I can categorically say that on the best information available that is not the case. I will comment no further on the possibilities, regrettable as they would be, of any developments of the strike into the civil aviation sector since there is no comprehensive or reliable information on that at this juncture.

President
Our thanks are due to Commissioner Kinnock for giving us an account of his position. That ends question time.

Appointment of EMI President
President
The next item is the joint debate on the following:
recommendation (A4-0373/96) by the Committee on Economic and Monetary Affairs and Industrial Policy, on the reappointment of the President of the European Monetary Institute from 1 January 1997 until 30 June 1997 (rapporteur: Mr von Wogau); -recommendation (A4-0372/96) by the Committee on Economic and Monetary Affairs and Industrial Policy, on the appointment of the President of the European Monetary Institute from 1 July 1997 (rapporteur: Mr von Wogau).
von Wogau
Mr President, ladies and gentlemen, under the Maastricht Treaty the European Parliament is to be consulted on the appointment of the President of the European Monetary Institute, and in fact is required to give an opinion regarding the candidate. Today, then, we are called upon to give an opinion, first, on extending President Alexandre Lamfalussy's term of office until mid-1997, which has been proposed, and secondly on the appointment of Mr Wim Duisenberg to succeed him from July next year.
I should like to take this opportunity to thank Mr Alexandre Lamfalussy for his efforts in past years. He has established the European Monetary Institute as required by the Maastricht Treaty. I need not remind you what a difficult job that was at first. I remember the building work that had to be done here. I remember a visit to the Monetary Institute in Frankfurt where we were virtually scrambling around on a building site. Even so, Alexandre Lamfalussy has proved an outstanding head of the Monetary Institute, and has even managed to keep to the timetable. If, today, we can feel certain that - at least as far as this aspect is concerned - the timetable for monetary union can be met, it is Alexandre Lamfalussy whom we have to thank for it. There are other things, too, for which I should like to thank him: his excellent cooperation with the European Parliament, the many discussions that have taken place in the European Parliament's Monetary Subcommittee, all the personal contacts, and the statements he has made here in this House. His cooperation with the European Parliament has been exemplary, and the Committee on Economic and Monetary Affairs and Industrial Policy therefore proposes that Alexandre Lamfalussy's term of office be extended until June 1997.
Mr Wim Duisenberg has been proposed to us as Alexandre Lamfalussy's successor. On 30 October this year we invited him to be questioned by the committee. We used the same procedure that we employ for the appointment of the European Commissioners - starting with a hearing at which the candidate is invited to answer questions on personal and substantive matters, following which the committee retires to deliberate and reach a decision. We took our duties very seriously, because we are aware that this is an exceptionally important appointment.
We need to bear very much in mind that the magical date of 1 January 1999 is now only 765 days away. In particular, during the brief period between the spring of 1998, when the decision is made on which countries will be participating, and December 1998 it will be crucial to make the European Central Bank operational as quickly as possible. That will be no easy matter. It would make sense, therefore, if the person now appointed to head the European Monetary Institute could later take charge of the European Central Bank. So we asked Mr Duisenberg that question: would he also be a candidate for the European Central Bank? His answer was a brief, crisp 'Yes' . I think that was an important moment. It surprised me very much that the press took virtually no notice of it, not even of the fact that this was a formal hearing at which the European Parliament was exercising its rights. We know that the decision on the first President of the Central Bank will be a matter for the heads of State and Government, after consulting the European Parliament, but despite that I thought it was important to obtain such a clear statement of intent from Mr Duisenberg.
In the course of the hearing it became very clear how much international experience of monetary matters Mr Duisenberg has acquired in the course of his professional life. He has also served as the Dutch Finance Minister, and was an exceptionally successful Governor of the Dutch Central Bank. He enjoyed pointing out that, in various areas connected with the stability of the guilder, he has actually been more successful than his colleagues in the German Bundesbank.
On the basis of its discussions, the committee came to the conclusion that Mr Duisenberg is certainly a suitable candidate, and we recommend the European Parliament to vote for his appointment tomorrow. But, in doing so, we will be placing our hopes and expectations in him. We all respect the independence of the European Central Bank, and regard it as a matter of the greatest importance. Equally, though, we are convinced that the Euro-Tower in Frankfurt must not be allowed to become an ivory tower, because the European Central Bank and its President will be taking decisions of the utmost importance for many citizens throughout the European Union. The President of the Central Bank, then, must declare his policy, and the forum for him to do so is the European Parliament - the committees and part-sessions of the European Parliament. So we expect and hope that Mr Duisenberg will continue to act in the excellent spirit of cooperation that we established with Mr Alexandre Lamfalussy.
The President of the European Monetary Institute is also the guarantor of the stability of the European currency. I should like to say once again why we in the European Parliament, by a very large majority, are convinced of the importance of a stable European currency. Last Saturday I spoke to a woman in the market place in Offenburg, and she said to me that she was very sceptical about the European currency. I asked her why. She told me that she had been working as a saleswoman for 54 years and was now planning to retire. She obtained a printed notice of her pension entitlement, and learned that she could expect DM 1, 130.00 per month. Her rent is DM 700.00. So anyone will understand that woman wondering whether rents and food prices are going to go up in the fairly near future, because her very existence is at stake here. People on small incomes cannot escape the effects of inflation in the same way as people on high incomes - inflation has a direct impact on such people, and they expect us to do everything we can to ensure that the euro will be a stable currency. If my meeting in the market square had been with Mr Soros or Mr Costollany, who earn their money through speculation, then of course their concerns would have been rather different, because we know that inflation can be a way of earning money, too. And that brings me to the second reason why the stability of the currency is so important: inflation diverts investment, sends it in the wrong directions - unproductive directions. If we want investors to invest in the future, to invest in jobs, then the first essential for that is to provide a stable currency.
I have no doubt that all the omens are good at present, though a great deal still remains to be done. On a more positive note, 10 out of 15 Member States now satisfy the stability criterion, meaning a rate of inflation of 2.6 % or less. I regard this as a major success, because it shows that the Member States of the European Union have made massive efforts as far as stability policy is concerned. However, it is equally clear that only three Member States have so far complied with the deficit criterion, which shows what great efforts are still needed if monetary union is indeed to become a reality on 1 January 1999 as planned. I am certain that, in order to sustain confidence, we need to stand by the stability criteria in accordance with the letter and spirit of the Maastricht Treaty.
The second reason why I am in a positive frame of mind with high hopes of the European currency and its stability is the independence of the European Central Bank and its concern for stability. This is a very, very important requirement. And we must have no doubt about this: whether or not European monetary union is a success will ultimately depend not on a handful of articles in the treaties, or on the phrasing we are so carefully working on at present, or even on the precise wording of the stability pact, but, to an absolutely crucial extent, on the individuals who will shape the future European Central Bank. I have no doubt that Mr Duisenberg will be one of those individuals, and I am convinced that this very important appointment decision that we are taking today will also be a right decision!

Randzio-Plath
Madam President, the Group of the Party of European Socialists also believes it is right to extend the mandate of the current EMI President, Mr Lamfalussy, and is also in favour of nominating Mr Duisenberg as a suitable candidate to take over as President of the European Monetary Institute. The fact that Mr Lamfalussy was able to construct and plan the European Monetary Institute, its personnel and its organization and its administration, was a stroke of luck for monetary history as a whole, not just for the development of that Institute. Really substantial progress has been made even as regards the status of the personnel, and also as regards the acceptance and credibility of the monetary union project in the finance markets and among the general public.
This Parliament, then, has reason to be grateful for his commitment to European monetary union, and express its gratitude that there has been a President Lamfalussy at the head of the Monetary Institute. I should like to remind the House that not only has Mr Lamfalussy, as agreed, complied with his democratic obligation to give an account of his acts both in discussions with the Subcommittee on Monetary Affairs and here in the House, but it was also possible to approach him with projects that were important to this House. To quote just one example, this Parliament was a very early supporter of the European exchange rate mechanism, designed to prevent a split in the internal market and a split, too, between countries that would participate in monetary union and countries that would not. The President of the European Monetary Institute, contrary to the view that had previously prevailed, very quickly recognized the need to find a new mechanism which would both suppress speculation and express solidarity, without depriving the future European Central Bank of its mandatory objective.
Our questioning of his successor, Mr Duisenberg, enabled us once again to make it clear what this European Parliament expects of the President of the European Monetary Institute. Personal integrity and qualifications are important, undoubtedly. But questions about monetary conceptions, attitudes to monetary policy and the role of that policy within the European Union were very important, too. In the course of this question-and-answer session, the Members of this Parliament were able to make it clear how much Parliament expects of the future President of the European Monetary Institute - expectations which, of course, are all the greater because this candidate has stated that he is also a candidate for the office of President of the European Central Bank. So we take him seriously when he says that the democratic accountability of monetary authorities in this European Union is of great importance to him, too. In that light, I expect him, in his function as President of the European Monetary Institute, to move further ahead with the preparations for monetary union, so as to ensure that it is technically and organizationally impossible for it to fail. But I also expect him to ensure that, before the European central banking system and the European Central Bank itself are set up, all the national central banks are independent. He might, for example, influence his own government to ensure that the central bank in the Netherlands becomes independent very quickly now - that would be a symbol of credibility.
The same applies to the dialogue with this European Parliament and the Subcommittee on Monetary Affairs, and it will also be necessary to document this democratic accountability, with the European Central Bank bringing transparency to the justification of monetary decisions, with a guarantee of the complete independence of that institution. So the articles of association, the statutes of the European Central Bank, must be prepared to enable the European Central Bank to be set up in 1998. Here again, we place great reliance on this president, who has assured us that monetary policy for him is not just a neutral policy but also includes economic and employment policy...
(The President cut the speaker off)

Gasòliba i Böhm
Madam President, ladies and gentlemen, on behalf of the Liberal Group, I would like to express our full and committed support both for the recommendation to extend the mandate of the President of the European Monetary Institute, Mr Alexandre Lamfalussy, up to 30 June 1997, and for the recommendation to appoint Dr Wim Duisenberg as his successor. This is an extremely important appointment with far-reaching consequences for normal development of the third stage of Economic and Monetary Union and the introduction of the euro. The timetable is now a pressing one and we must now progress with maximum precision, given that we are less than two years away from the setting-up of the European Central Bank and barely more than 24 months away from the introduction of the euro.
Both Mr Lamfalussy and Dr Duisenberg have to ensure that, in the coming months, the European Monetary Institute carries out the work which is vital for guaranteeing not only the proper functioning of the European System of Central Banks but also the introduction of the rules, direction, structure, logistics and organization involved in all those aspects which are to form the link between the Central Banks of the Member States, the European System of Central Banks and the European Central Bank.
We would like to draw honourable Members' attention to the momentous importance of this process, which will lead to the consolidation of one of the bases and one of the milestones in the process of European integration over the last 20 years, and to its significance in terms of the future structure of the Union as we enter the 21st century.
Naturally, if we achieve full European Union, operating with a single currency managed by a European Central Bank, a European System of Central Banks, under the overall direction of a single economic and monetary policy at Union level, we will have made enormous progress on the path towards European integration. This is the task facing Mr Lamfalussy and especially Dr Duisenberg over the next few months and we would like to confirm that they may rely on our full cooperation and support in achieving this task which, I say again, is of immense importance as regards the process of European integration in the Union as laid down in the Treaty.

Hautala
Madam President, in committee my Group was unable to endorse the unanimous recommendation that Mr Duisenberg be selected to head the European Monetary Institute. He is unquestionably a very experienced and competent individual, but we believe that his basic monetary and economic views are not of a kind which we can support. He seems to be a strong advocate of monetarism, and he also seriously underestimates the need for a common economic policy under monetary union. We consider that such a policy will be an absolute must.
Although the future European Central Bank's independence of political passions must be safeguarded, it is important that the Central Bank should be directed by people who have a realistic view of the operation of the real economy. As we are not particularly convinced that he does, I have recommended that my Group should abstain in tomorrow's vote.

President
The debate is closed.
The vote will take place tomorrow at 11 a.m.

Convergence and single currency
President
The next item is the joint debate on the following reports:
A4-0379/96 by Mr Metten, on behalf of the Committee on Economic and Monetary Affairs and Industrial Policy, embodying the opinion of the European Parliament, pursuant to Article 109j(2) of the Treaty, on the 1996 convergence decision by the Council, meeting in the composition of the Heads of State or Government (11505/96 - C4-0586/96); -A4-0371/96 by Mr Christodoulou, on behalf of the Committee on Economic and Monetary Affairs and Industrial Policy, on: I. the proposal for a Council Regulation (EC) on the strengthening of the surveillance and coordination of budgetary positions (COM(96)0496 - C4-0576/96-96/0247(SYN))II.the proposal for a Council Regulation (EC) on speeding up and clarifying the implementation of the excessive deficit procedure (COM(96)0496 - C4-0577/96-96/0248(CNS)); -A4-0375/96 by Mr Herman, on behalf of the Committee on Economic and Monetary Affairs and Industrial Policy, on: I. the proposal for a Council Regulation on certain provisions relating to the introduction of the euro (COM(96)0499) - C4-0578/0-96/0249(CNS))II.on the proposal for a Council Regulation on the introduction of the euro (COM(96)0499 - C4-0579/0-96/0250(CNS)); -A4-0352/96 by Mr Hoppenstedt, on behalf of the Committee on Economic and Monetary Affairs and Industrial Policy, on the European Monetary Institute report concerning the changeover to the single currency (C4-0559/95); -A4-0374/96 by Mr Harrison, on behalf of the Committee on Economic and Monetary Affairs and Industrial Policy, on the impact of monetary policies on the real economy, inflation, interest rates, growth and employment within the third phase of economic and monetary union and the economic function of the convergence criteria.
Metten
Madam President, the convergence report bearing my name is the official opinion Parliament must give to the heads of state and governments on the date for the beginning of the third stage of Economic and Monetary Union. The Treaty stipulates that EMU may be started earlier than 1999 if a majority of Member States were now already in a position to qualify and if the heads of government were to agree. Since twelve of the Members States have issued a so-called 'excessive deficit statement' , it is clear that the first condition has not been met. The Treaty states that a start shall be made on 1 January 1999 with the Member States which qualify.
The report which is in my name confirms this conclusion. As Parliament's Committee on Economic and Monetary Affairs naturally saw this situation coming a long time ago it used this report to pursue another goal, namely to remove the taboo from the flexibility which is included in the criteria in the Treaty. That is why the explanatory statement in the report deals meticulously with the margin of manoeuvre available in the Treaty and the political interpretations required by the Treaty. The aim therefore of this report is to clarify and not to dictate. Depending on the situation prevalent at the time it may well be that Parliament has to decide on the choice of suitable candidates for EMU in 1998.
I believe that Parliament can be well pleased that the Commission adopted the same approach in its recent convergence report of 6 November. Although the convergence report of 5 November from the European Monetary Institute uses stronger language, there are still no basic differences with it.
In a word, the possibility of a flexible interpretation of the criteria is firmly on the political agenda. If you compare that with the reaction provoked by former President Giscard d'Estaing at a congress here in this Parliament in Brussels in February of this year when he basically did nothing more than refer to the flexibility of the Treaty, then you must be struck by the change in public opinion. That change is largely due to this House and this report has played a useful part in this process.
As to whether flexibility in the Treaty will prove to be really necessary, that is another question. Together with the convergence report the Commission published its autumn forecasts based on the latest figures and plans from the Member States. If these forecasts are realised, then EMU is possible with ten Member States on 1 January 1999, even if 3.0 % is maintained as the budget criterion. My view is that as economic developments improve there is less reason for using the relative clauses which are part of the criteria. Against that it is in everyone's interest that the first wave of EMU participants is as big as possible so that the two-fold division created by the EMU is as short-lived as possible.
The whole debate on whether that would not mean that the euro would be too weak seems to me to be spurious. The achievements expected of the Member States are enormous as can already be illustrated by the fact that the so-called pace-setter of the whole system, namely Germany, will have the greatest trouble in meeting the criteria in time. The euro will certainly not be weaker than the Deutschmark, certainly not with the Central Bank being more independent than the only existing central banks, including the German one.
A more realistic worry would be that the euro might be too hard at the cost of the Union's competitive strength and employment situation. The French debate on this is quite opportune, even although the proposals to tackle it via devaluation are disastrous. But this problem can be addressed when more specific rules on the exchange rate regime and policy are determined. That will be the right time and the right opportunity and Parliament will certainly express its views on that occasion.

Christodoulou
Madam President, we do not fully understand every aspect of the interaction between monetary policy and budgetary policy. It would appear, however, that monetary policy alone, without the help of budgetary policy, will be unable to maintain monetary stability in stage three of EMU. That does not mean, however, that budgetary policy should be subordinated exclusively to the goal of monetary stability. Such a thing would restrict the possibility of conducting an effective general development policy, not just for those Member States that have to make greater efforts to get their economies to converge with the economies of the more developed countries of the Union, but also for the Member States that are concerned about falling competitiveness. Our reason for pursuing EMU, leaving aside the basic objective of reinforcing the unification of Europe, is to add strength to the single market and thus to the European Union's competitiveness. I do not think that can be achieved exclusively by monetary means.
Consequently, in stage three of EMU, it will be necessary to establish a balance between the goal of stability for the single currency and the goal of support for the development efforts of participants and non-participants in EMU. To secure that balance and avoid the danger of creating competitive tendencies and behaviour, there will have to be harmonization of budgetary policies.
However, the Commission's proposals not only favour the view that budgetary policy should be totally subordinated to achievement of the objective of monetary stability but also partially alter the overall character of the current arrangements. They are relatively inflexible and basically seek to have a dissuasive effect. I do not question the need to secure and maintain budgetary stability. That stability is, of course, absolutely essential. And monetary stability as well, of course, enshrined as it is as an objective in the Union's body of law, is an essential requirement for the effective functioning of EMU. It needs to be said, however, that monetary stability cannot by itself solve all of the economic problems that the Union is facing today and will be called on to face in the future, and nor can it by itself put the European economy on an enduring competitive footing vis-à-vis the Union's major trading partners.
Extreme positions, whether they be too strict and inflexible and designed to remove every initiative for development from budgetary policy or whether they seek to make the rules excessively flexible and to introduce elements which would ultimately cast the advisability of their adoption into doubt, must therefore be avoided, because in either circumstance the arrangements could not be implemented.
Furthermore, the arrangements that are adopted must accord with the Treaty, and even with the adoption of stricter medium-term objectives they should not make the convergence criteria de facto more stringent and should not impede - instead of strengthening - the convergence efforts of Member States participating in and outside EMU. Let us not deceive ourselves, ladies and gentlemen. The effort towards convergence, towards real economic convergence, does not come to an end with fulfilment of criteria for entry to stage three, nor can it be safeguarded with measures of an automatic and mechanistic nature. Economic and above all monetary phenomena are by their very nature dynamic, and any attempt to restrain them within inflexible and static rules will not have the desired results.
The amendments that we are being asked to support, including the joint motions for resolution and amendments, seek to bring about some improvements in the Commission's proposals and to keep them as close as possible to economic reality, without, however, distancing them in the slightest degree from the provisions of the Treaty. If the Commission's proposals stay as they are, they will, I say again, not be implementable.
I will summarize the main proposals in the amendments for you.
First, incorporation of the convergence programmes in the national budgetary procedures and greater involvement of the national parliaments. As far as the European Parliament is concerned, the request is for more information to be provided to it before rather than after the event.
Second, the leeway available to the Commission, under Article 104c(3), to take account of other factors relevant to the economic and budgetary position of a Member State when monitoring fulfilment of the budgetary criterion is clarified and stressed. And in view of that leeway, a request is made for the stability programmes to provide clarification of the expected main economic developments, including factors relating to employment creation, government investment expenditure as a ratio to GDP and other aspects, as well as of the objectives.
Third, the definition of the circumstances in which the excess of a budgetary deficit over the reference value is to be considered exceptional and temporary are clarified, augmented and made more realistic.
Fourth, while the imposition of the financial deposit penalty is not contested, its automatic and mechanistic character is to some extent removed. One of the amendments stipulates that the penalty should not be imposed as a rule but rather could be imposed. It introduces, that is to say, an element of flexibility, albeit slight, which in no way reduces the powers of scrutiny vested in the Council by the Treaty. Another amendment stipulates that the amount of the deposit, or of the fine if the deposit becomes a fine, should not be considered as part of the government expenditure in the examination of the public deficit.
Lastly, it has been considered necessary to provide for periodic re-examination of the provisions of the regulations in the light of experience in order to improve their effectiveness and to take account of substantive changes and, possibly, the results of the intergovernmental conference.
Madam President, the Commission must confront these proposals in a spirit of cooperation and understanding, given that our purpose in forwarding them is to make our task easier. The decisions it takes and the manner in which it approaches the European Parliament's report must have a clear political character and not be purely technical, and it must take account of the wishes and sensitivities of all of the Member States of the Union. We are aware of the problems that it has and we are aware of the interests that it may be seeking to serve. But as its president, Mr Santer, has said, the role of the Commission is political, and it is that political role that we wish it to assume now by accepting the amendments that we have tabled.

Herman
Madam President, Commissioner, although Parliament has had insufficient time to give full consideration to all the legal problems raised by the introduction of the euro, our committee and our Parliament can approve the broad lines of the two proposals for Regulations you have put before us. They both represent a sound basis for moving forward to the biggest monetary event of all time.
Never before in the history of our peoples has there been an operation on such a scale, representing such a radical change affecting so many people. That is why Parliament cannot overemphasize the need to inform, prepare and reassure the population. We are a long way behind in this respect - and there is not much time left to make good that shortfall.
The same reasoning leads us to insist that the text should be proof against any legal challenge. I am sorry to say that it is not. And the Ecofin council, like the Commission, despite all the opinions obtained from all the lawyers that surround them, have too lightly brushed aside the objection raised regarding the Madrid decision that something laid down by a treaty could be changed by a summit. No matter how much you use every trick in the lawyer's book to try to explain that the ECU doesn't mean an écu, that it means a 'European currency unit' , it doesn't stick. And you will see that it doesn't. I am sorry to have to say so.
The same applies to other more important amendments, and in this case I accuse the Commission of having capitulated far too easily. The euro, after all, is not just the currency of the Member States, it is also the currency of the Community. You didn't want that, and why not? Because your lawyers said to you, ' The Community is not a state.' Wrong. According to the treaties - and as witness the fact that you are creating a currency - a central bank has the power to issue the European currency. It therefore has the ability to justify it, internally and externally. And just because two Member States are temporarily seceding by opting out is no reason to give in to them.
Secondly, the decision you have to take on this is based not on Article 235 but on Article 104, which is an article that can be adopted by a qualified majority. So the objections of Denmark and the United Kingdom count for nothing in this case. Let them vote against, we can vote in favour anyway. So I accuse the Commission of having been unbelievably timid in the defence of its own interests. That, Madam President, is why I hope that - with the benefit of reflection, with the benefit of careful analysis - you will be able to accept the amendments we are putting to you in this respect.
In addition, I should like to defend two other amendments. There is the one that says, in particular, that it is the Central Bank that issues the European currency and the national central banks that circulate it. The objection has been: ' But we're following the text of the Treaty!' Wrong again! In the text of the Treaty, the statutes of the Central Bank are equivalent to those of the Treaty, and so when there is a contradiction between the statutes of the Central Bank which form part of the Treaty and the text of the Treaty itself, that contradiction has to be reconciled by interpreting the intent of the authors of the texts. And, in that context, I am quite sure you will also accept our amendment stating that it is the Central Bank which issues the currency and the national banks that circulate it. That is what should be done - that is what you would have to accept if you were logical and consistent in your own actions.
Finally, my last remark concerns the principle so often stated that the euro involves no obligations but no prohibitions either. The true interpretation of this principle is to be found not in your text but in ours. We say that when both parties wish to do so, they can use the euro as they wish; just because a contract was drawn up at the outset in national currency, especially if it dates from a very long time back, and just because that national currency is now to be replaced by the euro that does not mean that the contract has to be performed in the national currency during the transition period. The true legal expression of the principle that you have so often declared is reflected better in our text than in yours. And, here again, I hope that when you have thought about this again and listened more carefully to what Parliament has to say you will take account of it and adopt it.
Those, Madam President, are three comments I wanted to make. I was pleased to note that the Commission's intention was to take due account of Parliament's concerns as far as consumer protection is concerned, and that you were intending to submit proposals on that subject shortly, in a different text. I welcome that intention. If that is indeed the case, we should be able to consider with a degree of understanding and a great deal of indulgence the fact that, on this point, you refused our amendments.

President
Thank you, Mr Herman. I am sure that the Commissioner will make haste to reply to your vigorous contribution.

Hoppenstedt
Madam President, ladies and gentlemen, let me start by reminding you that this report by the European Monetary Institute on the changeover to the single currency was presented in November last year to pave the way for the European Council in Madrid in November 1995 to decide in favour of the single European currency.
Verona, Luxembourg and Florence were additional staging posts, at which discussion focused mainly on budgetary discipline and future relations between the Member States inside the euro area and those outside it, within the framework of a possible new EMS II. The Dublin Council is imminent. Following a vote in favour by the Committee on Economic and Monetary Affairs and Industrial Policy, my report gives timely consideration to the major questions of the future.
Once again, I should particularly like to emphasize - there is some overlap here, of course - that only a strong, politically stable European Union based on a single currency makes sense as a way of solving the problems affecting the economy and world trade. The euro must become a catalyst and a sheet anchor for the continuing unification of Europe. The main value and necessity of the euro, as we also know, is that it is only the coming of the euro that will produce the full flowering of the European single market and will make its various sub-markets purer, more comparable and more calculable, while its products become more economical because they no longer have to bear the costs of foreign exchange and price increases.
Increasingly, the euro will create a financial market offering wide investment and finance options. The advantage of the euro, as a sheet anchor and reserve currency, will be partly the guarantee it offers of stability and improved performance by European industry. Speculation will be more effectively fended off, the calculations of Europe's exporting industry will be placed on a reliable footing, and so further job losses will be prevented.
It is necessary to ensure that the criteria laid down in the Maastricht Treaty for the introduction of monetary union are complied with. Those contractually agreed criteria must, of course, be binding, and permanently binding. Shortterm cosmetic operations to enhance the next budgets, the budgets that will be used to assess readiness to join monetary union, must be avoided. In order to ensure that the necessary budgetary discipline continues after access to economic and monetary union, there must be a stability pact, and that pact must not be a phoney one to set the minds of Europe's citizens at rest, but one that must contain effective mechanisms.
The general consensus of all Member States in favour of a long-term stability policy at the Dublin Council will be the acid test of whether they do really mean to do as I have just said. We, as politicians, never weary - as this afternoon clearly illustrates - of debating the euro and all the important elements of successful monetary union. At least as important is to discuss the subject in depth with the citizen, and provide him with the necessary information. That is why I particularly welcome the information campaign launched by Parliament, the Commission and the Member States, together with all the information events and future briefings for interested parties.
One final subject, particularly important for us, is the phase of acclimatization to the euro, and especially dual pricing. The costs of dual pricing as projected by the trade associations will amount to over ECU 25, 000 million, a gigantic sum if their calculations are even half-way accurate. Cost-effective answers must be found to this problem before the end of this year, answers which will not only guarantee adequate transparency for consumers but will also keep down the costs of dual pricing, especially in the retail and mail order sectors.
We have always said that when we change over to the euro, the new European currency, there must be no winners and no losers - the costs must not be unilaterally passed on to the consumer. It would certainly be helpful, during the period between 1999 and 2002, to suggest in all public sectors, or to make it compulsory, that all salary payments, fees and other cash transactions should be quoted in euros and in the domestic currency, for the purposes of information, to give the citizen a longer period of acclimatization and so, eventually, shorten the period of dual pricing previously agreed on. I ask you to vote in favour of my report at tomorrow's voting time, and I believe that the relatively large vote in favour by the Committee on Economic and Monetary Affairs and Industrial Policy should be reflected in this Parliament.

Harrison
Mr President, before introducing my report on economic and monetary union, and the impact of monetary policies on the real economy, I would like to comment on the debate on EMU as a whole and its reception in my country, the United Kingdom. Last week a row blew up in London when the government was rightly pilloried for preventing a debate on EMU in the House of Commons, arising from the presentation of EMU-related papers, including some of those we are debating today. The surprise for me, however, was the reaction of the House of Commons and its Gemini twin, the London media. The mother of all parliaments seems to be unaware that its grown-up daughter, the European Parliament, has been debating some of these vital documents for weeks. The elected British MEPs have been at the heart of this parliamentary scrutiny, defending vigorously British interests while constructively building Europe, through the agency of EMU. Do they not read the papers? But there is the rub: the London based media is at its idle best in reporting the European Parliament, it does not. From a combination of ignorance, arrogance, laziness, fear and loathing it studiously demotes or denigrates the reasoned response of this Parliament to the concerns and worries of the man and woman in the street in Britain today, not the least anxiety of which is the search for jobs.
Paragraph 13 of my report contests the fashionable view in London's incestuous media circles that the single currency will not produce jobs. It will. And in so doing will wholly comply with the commanding Article 2 of the EU Treaty promoting decent jobs and respect for the environment.
The Maastricht Treaty as we have it has some weaknesses which the Harrison report tries to remedy. Take the European Central Bank which will engage in so compelling a role in all our lives within a few years. The voter rightly asks what democratic control, what accountability, will be exercised on the Central Bank governor? His role will be pivotal in determining the exchange rates, hence the interest rate and inflation levels which we all sink or swim in as we, as mortgage holders and business people, try to pick our way through the pitfalls of our own local economic environment.
My report in no way threatens the independence of the European Central Bank. Britain's experience is vivid of the interfering Mrs Thatcher who ignored Sir Nigel Wicks of the Monetary Committee and fixed the UK entry into the ERM in 1990 at a rate which thereafter crippled British industry. I suggest that we can strengthen accountability by reaching an inter-institutional agreement with Commission and Council on determining the ECB executive board and Ecofin appointments and by debating the ECB annual report. Such supplements will be welcome in fleshing out the central proposition of this report, which declares that monetary policy is not neutral. It does affect the real economy and central bank governors need reminding of that fact from time to time.
A second problem addresses the apparent dislocation in EMU of having a single monetary policy effected by the ECB, whilst complementary fiscal policies will be decided and enacted separately by the 15 Member States. The EU's structural funds, the TENs, the work of the European Investment Bank all go some way to close the gap. Imperative however, and far more influential, is to ensure the very greatest coherence between Member States' economic and fiscal planning. This can be done through greater use of the Treaty's broad economic guidelines and multilateral surveillance procedures. In both these the European Parliament must be directly involved. This democratic scrutiny is essential and in part answers the hysterical response of the Tory Eurosceptics' claim that the European Commission is secretly taking a major role in coordinating Member States' budgetary and economic planning. Such coordination is, of course, precisely what the Tory Government signed up to. Nor does the UK EMU opt-out excuse the UK Government from that responsibility.
The final area that I would like to highlight in my report is the weight lent to aspects of the real economy which are overlooked by the overwhelming concentration on the monetary criteria. In steering Europe's economies towards convergence I allude in particular to Article 109j(1) of the Treaty, where other economic indicators are stipulated which should be then taken into account in assessing the convergence criteria. To balance the effect of possible contraction of Member States' growth prospects, due to budgetary consolidation, recognition needs to be made for investment patterns, for the unemployment rate, for studying unit labour costs and, very importantly, for the progress made in completing the single market. Given these elements their proper emphasis will go some way to dispel the fear of the citizen that EMU is subject only to dry, inhumane monetary criteria.
I return to where I began. EMU will only succeed if it provides a decent life for our citizens and that is the ultimate goal to which the Harrison report aspires.

Willockx
Mr President, ladies and gentlemen. The importance of this current debate cannot easily be overlooked. What we are doing in my view is setting the economic framework for society in the future. And so it is important that in this debate we try to reflect the wishes of the general public. We must therefore always be on our guard that this debate does not deteriorate into a debate among technocrats. We must ensure, and this is the job of Parliament, that this difficult subject matter is put into terms which are understandable to the public.
What do we say about the content of the stability pact? First of all there is general agreement that we must continue to strive towards healthy public finances. These are the best guarantee for a proper and efficient government and they are indeed the basis for tomorrow's employment.
Secondly, we must be careful that healthy public finances do not depend solely on the development of expenditure. We must beware against strong competition between Member States in the field of taxation leading to fiscal erosion which exerts greater pressure on expenditure. We must create the necessary space so that at certain times the governments and the European institutions are allowed to follow an anti-cyclical policy. That is why we say that the Commission has undoubtedly taken steps in the right direction in its work on the original proposals which resulted from the Dublin Summit.
In a word, we approve of consolidation of convergence. We reject the continuing deflationary nature which has accompanied the pursuit of the convergence criteria. We in the Committee on Budgets ask that special attention be paid to a specific definition of the new source of income which Europe should preferably not enjoy, although it may happen, when deposits of guarantees are made when a number of criteria are transgressed.
Mr President-in-Office, may I appeal to you directly to take into consideration the views of a large majority of the elected representatives in this House in the final decision of the Council of Ministers? I believe that is essential if the Europe of tomorrow is to remain credible in the eyes of society.

Whitehead
Mr President, I am grateful that I can speak on these, important issues for the citizens of Europe this afternoon. There are great issues of principle before us today. I would not claim that the matters I wish to raise are those which will most preoccupy the statesmen of Europe, but they will preoccupy the citizens of Europe. The citizens of Europe need to know that their interests are protected when one of the most fundamental changes in their ordinary lives comes about, as I believe it will, sometime over the next five years. I personally regret the fact that the Consumer Affairs Commissioner, and her team, appear to have little notice and little input at the level of the proposals that were coming before us. I am grateful to the Economic and Monetary Affairs Committee for taking on board so many of the consumer amendments which were put forward by the Environment Committee.
I would just like to make one simple point and that is on the issue of dual pricing in relation to the annual report. I believe that it is necessary for the citizen to be able to make an easy point of reference to the currency and the values which have become familiar over a lifetime throughout the period of transition when the new currency is being introduced and for a period beyond the point of introduction.
In the United Kingdom we have had over the past few years to adjust to the metrication system which, for all of the other Member States represented here, has been a point of easy familiarity. We know how difficult it was to make that adjustment, particularly for the old and less well-informed, and that is why we support the proposal of the amendments for the introduction of a dual pricing system which are now to be carried, I hope, in this report.

De Clercq
Mr President, the report from the European Monetary Institute on the transition to the single currency lacks a very important dimension, namely the international consequences of the euro for the European Union. What are the international consequences for the European Union of the introduction of a common currency?
First of all the political importance and international role of the European Union in implementing economic and financial policy in an international context is strengthened. The euro will facilitate the balance in the international monetary system, particularly in relation to the dollar.
Secondly the euro will provide the European Union with better protection against external shocks which means a fundamental improvement on the present European monetary System.
Thirdly the euro will facilitate multilateral dialogue with a view to more effective coordination of the economic policy of the most important trading blocs. The EU will be better equipped to insist on more balanced macro economic relations in the world.
So the euro will mean greater responsibility for Europe in tackling international economic and monetary problems. The position of the Union will thereby grow within the financial and economic international organisations as will the need for defining the Union's participation in these organisations.
Furthermore we think an external reference scenario for the transitional period in the run up to the common currency is absolutely essential. These last two conclusions are supported by Mr Hoppenstedt and we are grateful to him for that. The euro therefore puts the Union in a position of being able to play a role in the monetary field which is more in line with its weight in the economic and trade field. The international consequences of a single currency therefore deserve all our attention.

Quinn
Mr President, today is an important day in the process of European integration. The deliberations of Parliament at this part-session will mark another stage in the preparations for economic and monetary union. I am therefore very pleased to have the opportunity to address you today in my capacity as President-in-Office of the Council of Economic and Finance Ministers.
President, your session today will cover a number of EMU issues, including discussion of the draft Council regulations produced by the European Commission last month in relation to the stability pact and the legal framework of the Euro. You will also be considering your opinion under Article 109j of the Treaty on European Union. In the latter case you already have before you Ecofin's recommendation to the European Council under this article.
It will come as no surprise that Ecofin, on 11 November, on the basis of the reports of the Commission and the European Monetary Institute and the recommendation of the Commission, adopted a recommendation to the European Council to decide the following: firstly, that a majority of Member States do not fulfil the necessary conditions for the adoption of the single currency; secondly, that the Community will not, therefore, enter third stage of EMU in 1997; thirdly, that the procedure laid down in Article 109j(4), will be applied as early as possible in 1998.
The Ecofin recommendation of 11 November was sent to Parliament on the very day and Parliament is now formulating its own opinion. Clearly that opinion is entirely a matter for Parliament itself and as President-in-Office of Ecofin I therefore have nothing more to say about it. I should, however, take this opportunity to mention that the speed with which Parliament has moved to formulate its opinion, and indeed your willingness to deal promptly with other EMU items before you today is very much appreciated by me as President-in-Office of Ecofin and indeed by all the Members of the Council.
I would now like to give you a brief report on the present state of the work necessary for the launching of EMU on 1 January 1999. As you know the European Council in Madrid last December marked a decisive step forward in the preparations for EMU by naming the new currency the Euro and by setting-out a comprehensive timetable for the change-over to it. Briefly, EMU will begin on 1 January 1999 with the irrevocable fixing of the conversion rates of the currencies of the participating Member States and the Euro will become a currency in its own right.
The monetary policy of the new currency will of course be conducted in Euros from the beginning and new tradeable public debt will be issued in Euros from 1 January 1999. There will then be a transitional period until Euro banknotes and coins start to circulate alongside national coins and notes. The latter will then begin to be withdrawn until the changeover to the Euro is complete.
As well as benefiting from the work of the Madrid European Council, the Irish presidency also benefited from the progress achieved under the Italian presidency, in particular at the informal Council meeting in Verona in April. On foot of that progress the Florence European Council urged Ecofin, along with the Commission and the EMI in their respective fields of competence, to pursue work on three issues relating to EMU: the relations between participating and non-participating Member States, including a new exchange rate mechanism; secondly, technical preparatory work on the legal framework for the Euro and thirdly, the fiscal stability in stage 3 of EMU, Ecofin was asked to work with the view to presenting conclusions showing further substantive progress to the European Council in Dublin.
I want to tell you that we have made considerable progress on all three issues. In Dublin in September I hosted an informal meeting of EU Finance Ministers and central bank governors to review progress and to chart the course to the December Dublin European Council. The informal meeting ensured that we are well on our way to achieving our presidency objectives.
The momentum provided by that meeting enabled the Commission last month to adopt legislative proposals on the stability pact and on the legal framework for the Euro as well as a draft communication to Council on the relationship between participating and non-participating Member States. As regards the latter issue, the report from Ecofin to the Dublin European Council will address the new exchange rate mechanism to be put in place on the formation of EMU.
Of course the main features of the new ERM are already known, in particular the fact that the central rates of participating currencies will be set against the Euro only. Both because of its role as an anchor currency and in order to emphasize the goal of convergence to the Euro area. The new mechanism will aim to help to protect Member States from excessive exchange rate fluctuations and so will help to underpin the single market. Work on the details of the new ERM will be put in hand after Dublin, although they cannot of course be finalized until the European Central Bank is set up in 1998.
Ecofin's report to Dublin under this heading will also address the arrangements for enhanced surveillance of economic policies with a view to ensuring that they are conducive to the convergence that is essential to monetary stability. As regards the second part of Ecofin's work, you will know that the Commission adopted proposals last month for two draft Council regulations on the legal framework of the Euro.
The first draft regulation is based on Article 235 of the Treaty and contains the items which are required to be adopted as a matter of urgency. These include rounding rules, continuity of contracts and one-to-one substitution of the Ecu by the Euro. The second is based on Article 109l(4) of the Treaty and contains the other provisions necessary for the legal framework. As Article 109l(4) requires Council to act with the unanimity of those Member States without a derogation, this second proposal will not be adopted until later.
A Council Working Group has been examining the two proposals and on 11 November Ecofin noted that substantial progress had been made, particularly on the Article 235 proposal. Of course progress towards final adoption depends not just on the Council but also on Parliament and I am glad to know that you are dealing so expeditiously with these two draft regulations. May I further add that I am aware that the Council has expressed its concerns that the consumer dimension to this entire project has to receive adequate attention and indeed we have just had a contribution in that respect from one of the previous speakers. I expect, therefore, that the Commission will be bringing forward proposals in due course on this particular issue for your consideration.
The third issue before Ecofin concerns securing budget discipline in stage 3 of EMU, in other words the stability pact. The Commission has also submitted two proposals for Council regulations in this area. The first deals with the clarification of the excessive deficit procedure under Article 104c and covers the issue of sanctions. The second proposal deals with the strengthening of the surveillance and coordination of budgetary positions under Article 103(5) of the Treaty. The second proposal will be subject to the cooperation procedure within the European Parliament. On the first, the Council will consult the European Parliament in conformity with Article 104c(14) of the Treaty.
The tabling of these two proposals by the Commission indicates that progress has been made towards formulating a stability pact. There is already wide agreement on many elements. For example, we have agreed that Member States in EMU will be obliged to submit stability programmes, demonstrating a commitment to orderly management of their public finances and to keeping their deficits below the Treaty reference value of 3 % of GDP over the course of a normal economic cycle. There is also agreement that there should be an early warning system to help prevent excessive deficits arising.
Work is advancing on the remaining features of the pact. These include the specification of the sanctions provided for by the Treaty, if a Member State in EMU fails to take effective action to remedy an excessive deficit and the definition of when the excess of a government deficit over the Treaty reference value is to be considered 'exceptional and temporary' . Ecofin Ministers had a thorough and fruitful exchange of views at their meeting on 11 November and will be considering the matter again next Monday here in Brussels. It remains to be seen how far the details of the work on the stability pact can be specified by the end of the Irish presidency though I am hopeful that it would be possible for the Dublin European Council to make further progress on it.
Before concluding my remarks on the stability pact I think I should explain some of the thinking behind it. Clearly the pact is primarily aimed at ensuring a stable foundation for the Euro, by ensuring that Member States in the Euro area keep their general government deficits below the Treaty ceiling of 3 % of gross domestic product, across a normal economic cycle. But I should also add that by promoting stability-oriented fiscal policy the pact also aims at creating the conditions in which low interest rates will be consistent with low inflation. From the Irish experience I can say that low interest rates and low inflation will help to promote investment, thus in turn promoting the objective of all Member States and every Member in this House which is to maximize sustainable growth and employment.
So much for the progress we have been making on EMU at Ecofin and indeed the prospects for the Dublin European Council in December. But it is not just at Ecofin, or indeed at the European Parliament, that preparations for EMU are being made. So I think it would be appropriate to end by briefly mentioning some of the things which are going on elsewhere and which provide further evidence of the increasing momentum towards EMU. First of all, and this may be known to some of you, but not perhaps to all, there are practical preparations going on in the public administrations and in Member States' banking systems for the change-over to the Euro. Indeed it is clear that in some Member States these are now at quite an advanced stage. Evidence that the EMU process has taken hold is also provided by that very cynical institution the financial markets where convergence trades have reduced the differentials between Member States' interest rates. Convergence among Member States as regards inflation has also increased significantly, a fact mentioned in recent reports from the Commission and the EMI. There has also been the recent and indeed very welcome entry of both the Finnish markka and the re-entry of the Italian lire into the exchange rate mechanism.
I speak to you both as a politician and to politicians and it seems to me that the most convincing evidence of the commitment of Members States to EMU is the determination that they are showing in getting their public finances in order across all the Member States. This determination arises not just from EMU but also because sound public finances make sense in their own right. I said earlier the example of Ireland shows, if I may say so, that fiscal consolidation does work. But that does not make it easy and it is the willingness to undertake the hard tasks which demonstrates Member States' commitment to the EMU process.
Before I conclude, a couple of items were raised in the course of the debate to which I would like to respond. First and foremost with regard to consumers and the question of a double-pricing, a contribution that was made by Mr Whitehead, I just want to say that from our point of view we intend in Dublin, for the week starting 9 December across the period of the Dublin Council, to request and obtain the cooperation of some of our large retail units, and more importantly our public houses, to introduce a system of double-pricing in order to provide our citizens with a sense of familiarity with this procedure and we expect, subject to final agreement, that the newspaper advertisements running up to the Christmas period for some of the large supermarkets will in fact have dual-pricing mechanisms in place. I would like to see this process encouraged across the entire 15 Member States of the Community, even indeed, dare I say it, in Great Britain, Mr Harrison.
With regards to the international implications of the Euro, a point made by Mr De Clercq, if I recall correctly, this is something that we all should study in great detail. At a conference recently in Berlin organized by the Kangaroo Group I offered some of my views in this respect. Certainly we will be less vulnerable to external economic shocks than we currently are with 14 different currencies at the present time, which is a significant factor. We will be able to invoice outside the Euro area far more of our customers directly in Euro than is currently the case.
Lastly, and perhaps most importantly, certainly for me speaking as a member of the socialist family of the European Union, we would be able to provide for our former colonial, now independent states in Africa and elsewhere a much more sound currency to have their primary products denoted in, a currency that does not fluctuate in value terms to the same degree as other international currencies, particularly the dollar. That in turn will help to provide economic stability across the international global market.
However, I do not believe that enough work has yet been done in studying this particular phenomenon of the international dimension of the Euro and it is something that now we have opportunity to so do, having virtually completed a lot of the work in relation to the details of how the currency system will actually function.
My last and final word is to my old friend Freddy Willockx: Yes, you are right. The European single currency project will not work unless it has the support of the people, the citizens of Europe. It will not have their support if it does not comply with two overriding objectives. First of all it has to be perceived and it has to perform as a sound hard currency, and I say that as a socialist. It has to be seen and it has to perform as a sound hard currency that holds and retains its value. Secondly, such a sound hard currency combined with sound fiscal and budgetary management of public finances in all of the Member States and within the Commission will create the space and the opportunity within which people will make investment decisions of their own, set against a background of low inflation and low interest rates.
It is against that background that those states who have created a space for themselves would be able to make the kind of interventions in the market systems so as to correct the failures of the market system in the delivery of services or in reaching out to those sectors of the labour market, or in fact those sections of our population, who through no fault of their own have been marginalized or who have been alienated. A soft currency and high deficits is no friend of the European citizen of the present or the future. Therefore I believe that the rules and regulations which we are trying to put in place for the single currency is the best friend for the European citizen and the European citizen will in turn recognize it as such and give it the kind of political support which it must have to be a success.

Donnelly, Alan J.
Mr President, can I first of all of behalf of the whole House thank the President of the Ecofin Council for his presentation today and more importantly, for the way in which he has engaged the European Parliament in dialogue since the Irish took over the presidency of the European Union. I am sure I can speak on behalf of the whole House when I say how much we have valued his participation, not only in the meetings here in the Chamber, but also in Parliament's Committee on Economic and Monetary Affairs and Industrial Policy and of course the informal meetings we have had over the last few months. I would also like to thank the rapporteurs who have conducted the work on behalf of Parliament in an excellent fashion. We have been able to coordinate these reports so that we can have this general debate today on what is an extremely important and indeed a historic issue for the European Union.
We have the privilege today of having this debate on the single currency. We are debating reports which have been discussed in our various committees in Parliament, we have had the chance to discuss them in our political groups and we are now having a public debate on the floor of this House, as indeed we have had on many occasions in the past. I hope that the President of the Ecofin Council, when he presides over the Finance Ministers on Monday, encourages all his colleagues, to engage in a similar debate in their own national parliaments because that is the way we can defeat the Euroscepticism in Europe that exists at the moment on the single currency, by having public debates in our own parliaments, our national parliaments, and ensuring that these issues are fully aired.
I hope that this House will join with me in condemning any government that prevents the national parliament having a debate on what is of course an absolutely crucial issue for the citizens of the European Union. In particular he could whisper across the table to Mr Clark and encourage the British Government to have a full debate in the British Parliament in the very near future on this issue.
I would like to deal particularly with the issue of the stability pact. Let me say on behalf of my group that we remain fully committed to the single currency. We remain absolutely committed to strong economic coordination, which includes budgetary discipline, and we support the timetable for the implementation of the single currency from 1 January 1999. We are not prepared, however, to accept the budgetary straight-jacket that the German Finance Minister is trying to impose on us within the European Union.
We are in favour of having a stability pact that looks at the wider employment and economic implications for Europe, a pact that contain spending and borrowing at reasonable prudent levels, but which allows countries to take the necessary steps to prevent their economies slipping into recession. We should not be trying to tie the hands of national governments in managing their own economies. Any stability pact that emerges from the Ecofin Council that does that will be unacceptable not only to this House, but I believe will be unacceptable to the 15 national parliaments within the European Union.
On 16 October the European Commission agreed on the proposal for a stability pact to ensure budgetary discipline during the third phase of EMU. What was expected to be a fiscal straight-jacket, fully inspired by irrational fears of fiscal irresponsibility rather than rational economic thinking, turned into a more reasonable, albeit still partly unsatisfactory instrument, to respond to a legitimate need for budgetary discipline amongst Member States in a forthcoming monetary union. By avoiding quantifying significant negative annual real growth in the definition of exceptional and temporary circumstances, whose recognition allows temporary suspension of the obligation of compliance with the budget deficit criterion, the Commission refused to deprive Member States of the required budget flexibility to act promptly and effectively against significantly declining growth.
I commend the European Commission for having refused to tie the hands of Member States. I hope after the vote in this House tomorrow the Commission will maintain its position. I have great doubts however about whether the Ecofin Council will maintain the position proposed by the European Commission. I hope that if this Parliament votes to have a much more general definition tomorrow, combined with the views of the European Commission, then the Ecofin Council will ensure that it does not have a prescriptive definition when it comes to some of these issues associated with the stability pact.
We have to realise that if you have a Member State that suffers from a fall in its real GDP of 1 % in a given year, going inevitably hand-in-hand with increasing unemployment, raising unemployment benefit expenditure and falling tax revenues, in such a difficult situation any country would witness a rapidly deteriorating budget deficit of several percentage points likely to push it over the 3 % deficit ceiling, thus making it excessive. Even in such a difficult case, if the country's first priority was to fight a rising deficit, what would then happen is that it would be unable to take the steps to deal with the unemployment problem and the problem of the decline in its economy.
We cannot have that sort of straight-jacket placed on Member States. We cannot put economies in the European Union in that position and I do not believe that national parliaments will accept it. We have to accept that over 90 % of Europe's economy relies on the European market providing for powerful transmission mechanisms and spillover effects between Member States. You could end up, if you accept the Waigel proposal with a large European recession, and in all probability with the larger Member States affected first. The big Member States would be attacked by the measures that we might put in place at the Dublin Summit Meeting.
What I want to say to the President-in-Office of the Ecofin Council is yes, have a stability pact but have a stability pact that takes account of economic growth. Yes, we want to have prudent spending and prudent borrowing. We want to make sure that Member States do not undermine the single currency when it is created, but be realistic about this. Do not create a mechanism that is unnecessary and which in the future could push Europe into a deep recession. The European Parliament will not accept that, Member States will not accept that, and of course, most importantly, the people of Europe will condemn us if we bring that into operation.

Fourçans
Mr President, I should like to start by paying tribute to the Commission - not a common event, but it has to be done sometimes. I should like to pay tribute to its work on convergence. It has succeeded in creating a climate of consensus, allowing as many countries as possible to join the single currency when the time comes. It has also succeeded in complying with the timetable, which is no mean feat, as we know. So let that be put on record, Commissioner, as something that had to be said.
Now, ladies and gentlemen, I should like to give you my reactions to the ideas of a former high official of the French State, because they are directly associated with our debate. Calling a spade a spade, he suggests a straightforward devaluation of the franc. I say without hesitation that a devaluation would be dangerous for France, dangerous for the single currency and dangerous for Europe. What does devaluation mean? In itself, absolutely nothing. Exchange rates are not imposed by order. All of us here know that. We are no longer governed by a system of fixed parities. The Bretton-Woods agreements do not govern, or no longer govern, the relations between currencies.
If we wanted to reduce the value of the franc, nothing could be easier. All that would be needed would be for France to return to its former easy-going policies. If the deficits were once again to be left to run themselves, there is no doubt whatever that the franc would fall. Is that really a desirable development for France and for Europe? If the Bank of France were to return to its former inflationary habits, the franc would dive immediately. Is that really what we want to see happening for France or for Europe?
Budgetary and monetary slackness are not the answer to curing the evil of unemployment and the lethargic rate of growth. Trying to put the principal blame for our tribulations with employment and wealth creation on currency suggests an outmoded and, if I may say so, fantastic view of things. Yet this is true of every country in the European Union, and the others too.
Another problem associated with our debate, and with Mr Quinn's comments, is the future value of the euro against the dollar. This is a serious problem - it will call for careful consideration, and a clear statement from this Parliament. The euro will fluctuate against the dollar for a long period - there can be no alternative to that. So there is no such thing as a single international currency - that's just daydreaming. The value of the euro will fluctuate, depending on the economic policy followed by the States of the Union, on various fundamental factors and, of course, on the monetary policy pursued by the European Central Bank. Here again, though, the value of the euro is not going to be determined by a political ukase. We know that the European Central Bank's objective will be price stability. It is going to have to work towards that objective but also it is going to have to create conditions such as to favour strong, sustained growth and a high level of employment, as stipulated in the Treaty on European Union.
To talk about an overvalued euro, as some speakers have been inclined to do today, makes no economic sense and has more to do with cheap rhetoric than with economic reality. Even though the euro may be essential to promote economic growth in Europe, we must not believe, or lead others to believe, that our unemployment problems are going to vanish at one wave of the magic wand of the single currency, even if it is undervalued relative to the dollar. Ladies and gentlemen, that is the situation as I see it.

Garosci
Mr President, I am going to divide my speech into two parts, because we are concerned today with two different aspects of economic policy. The first concerns the transition to the single currency and the second the introduction and what we hope will be the definitive establishment of the euro as the single European currency.
Regarding the transition to the single currency, my main concern is that the Commission should be able to make every necessary and possible effort to ensure that those Member States which are unable to embark on Stage 3 from the outset can continue their efforts to achieve convergence. In other words, we must ensure that those States which are now approaching convergence are put in a position where they can undertake a change of direction so that the criteria can be complied with and so that Europe can reckon on the largest possible number of Member States - even if not fifteen - from the moment of introduction of the single currency. This, in fact, will be the first great tangible sign which will enable all Europe's citizens to see whether and in what form Europe exists. The single currency is an unrepeatable opportunity: upon the single currency and with the single currency we can build Europe, and we can bring about those things that we have hitherto been unable to bring about.
I do have one great concern, though, and that is that the introduction of the euro may have economic and social consequences which we cannot yet quantify precisely. Let me clarify that: introducing the euro and explaining it to all its users - which means, ultimately, the consumers - will have very precise costs and conditions. We and all the European institutions must be in a position to meet those costs and those conditions. On the one hand, then, we are going to have to think about the information to be provided to the consumer, the citizen, the end user; and on the other hand we are going to have to think clearly about training the professional users who are going to present the euro: I am talking about the commercial retail sector, because it will be in the shops, the supermarkets, in the restaurants and the travel agencies that the consumer discovers the euro, and that is where he is going to have to find senior and junior staff and officials able to explain it to him and to help him understand how the single currency works. So we are going to have to operate at two levels: on the one hand the so-called 'major outlets' , where we are going to have to finance training courses at all levels, from the checkout girl to the warehouseman, and on the other hand the myriad small- and medium-sized enterprises, small businessmen of every magnitude and in every sector who, at their points of sale and within their commercial structures, are going to have to deal with consumers asking 'How does the euro work? What's it worth in terms of my national currency? How am I going to do my shopping?' There, and only at that time, we shall see the birth of a great single market with 300 million consumers, a market which I prefer to call an 'internal market' rather than a 'single market' because it really will be a single great European system, and that will be the moment when the European citizen will finally appreciate that he is a European citizen.

Cox
Mr President, I wish to speak on the stability pact on behalf of the ELDR Group. Firstly, let me say that in spite of the hurried nature of this debate, I welcome the fact that it is taking place. In this most sensitive and critically important area of Member State budgetary policy and Stage 3 of monetary union it is important, we believe, that it be placed firmly and belong institutionally at the heart of the first pillar. Given the extent of monetary policy integration foreseen by the single currency project, it is vital that its economic policy counterparts, as they emerge, should involve all the institutions of the Union. The unfolding economic policy procedures must not be allowed to lapse into an intergovernmental mode. We cannot contemplate a centralized monetary policy without a coherent parallel economic policy, subject to appropriate democratic control.
I congratulate the Commission on behalf of the Liberal Group for claiming ownership on behalf of all the Union of the stability pact concept and I believe that their proposal exhibits a careful and appropriate balance. My Group supports the proposal and will vote against most of the amendments proposed, especially against those amendments that in our opinion send the wrong political signal by watering down the deficit criteria essential to a credible currency. We will judge our final vote in the light of which amendments carry.
The German Government has done the European Union a service by raising this debate and by posing the challenge of how economic policy should be set and governed in Stage 3 of the Union. In addition we are all conscious of the anxieties in the minds of so many Germans, who twice in living memory have seen their life savings destroyed by hyperinflation, that this should never happen again. It is proper that these anxieties are listened to, respected and addressed. But equally we believe that it is important that a well-founded national anxiety should not be transformed into a collective European angst and political deadlock.
Dublin II is fast approaching, to be preceded as we have heard by an Ecofin Council next Monday in Brussels. Our belief is that there is a clear political and a financial market expectation that Dublin II will deliver the Eurostatute, ERM II and the stability pact. Not to do so will I believe be perceived as a considerable set-back. Indeed, if Dublin II does not resolve these issues, why are we rushing them through this Parliament, in this debate, so as to accommodate the other institutions?
On the outstanding areas of disagreement on the stability pact, what constitutes temporary and exceptional circumstances and the automaticity of fines for errant States, the ELDR supports the room for manoeuvre and judgment indicated by the Commission's proposal. We do not accept that the exercise of constraint but real political judgement is a weakness. Indeed the opposite, we believe it is the strength of the proposal. Excessive zeal for technical, quantitative definitions runs the economic risk of turning the stability pact into a straight-jacket. It runs the political risk of making the best the enemy of the good and it runs the Summit risk of snatching defeat from the jaws of victory. The Commission should hold its line and if Ecofin and the Commission hold that line we will whole-heartedly support them.

Theonas
Mr President, today's debate is a further indication of the haste with which the European Union is moving ahead on all of the issues pertaining to admission to the third stage of economic and monetary union. Following on from the stubborn refusal to put the subject on the agenda at the intergovernmental conference, which would allow account to be taken of the tragic repercussions for the peoples of the Union and for the economies of the weakest countries and make it possible for things other than the infamous nominal criteria to be taken into consideration as conditions for the adoption of the single currency, the European Union is setting the stage for a lengthy period of austerity and budgetary belt-tightening via the German-inspired stability pact. It was said at the outset that austerity would be necessary until the introduction of the single currency, as a means to not missing the EMU boat, but now austerity is being imposed as a permanent thing. That transformation is not fortuitous.
Some people are trying to sugar the pill, to weaken the discontent and resistance of ordinary people, by attempting to promote improvements of one sort or another in the mechanism of the single monetary policy, as defined in the Maastricht Treaty, and in the ensuing decisions taken by the Community's institutions. They can see the impasse to which the EMU decisions are leading and are trying, without, however, distancing themselves from the whole enterprise, to broach certain concerns and worries via requests hinging on the interpretation of the criteria.
Mr Metten's endeavour is understandable, but it does not really change anything. A more flexible interpretation of the criteria would, unquestionably, bring more countries into the euro zone. However, it would not resolve the main problem associated with EMU, namely the danger of the establishment of a multi-speed Union, of a core Union surrounded by a wider zone of countries of second class status in terms of their economies and institutional clout, which private circles in the European Union are seeking to bring about. It offers no help on the issue of the ceding of control over monetary and exchange rate policy and, indeed, of control over economic policy itself, to undemocratic mechanisms totally lacking in transparency, such as the ESCB, whose decisions will have no parliamentary and democratic legitimacy.
The total indifference regarding the consequences that proceeding with EMU will have for workers and employment in the real, wider, economy stands out very starkly. The reports speak of the need for implementation of EMU, but nowhere does one find any mention of the millions of jobs that will be lost, of the disintegration that will be caused in the countries with diverging economies, of the collapse of labour relations, of the casting-aside of the social model that has been a feature of Europe in the recent decades as a result of the struggles engaged in by the labour movement.
Mr President, the tolerance of working people is running out. The worries that some people are expressing about the future of the European idea convince no one. We serve notice yet again that there is big trouble ahead if the warnings sent by the growing mobilization of the peoples of Europe against the theft of their incomes and of their other hard won rights are not heeded pretty quickly.
My group is totally opposed to the enterprise of economic and monetary union that the Maastricht Treaty has set in motion and it resents the stubborn refusal to allow discussion of the subject at the intergovernmental conference. So it will certainly not be supporting these reports.

Soltwedel-Schäfer
Mr President, ladies and gentlemen, I am very pleased that our debate on monetary union today is not about 'if' but about 'how' , and that this applies to all groups. We have been talking today about the legislative requirements for the independence of the national central banks, the institutional imbalance of the European central banks, public acceptance and the third stage of economic and monetary union.
I should like to endorse, very clearly and positively, what Mr Donnelly said. Let us have a stability pact by all means, but one geared to the budgetary stability of the individual nations, to employment policy, and absolutely not in the form of the Waigel-style strait-jacket. I would like to make that absolutely clear on behalf of our group.
The extent to which any such compliance is actually necessary has now developed into a subject of heated debate, because the political concessions made to the opponents of Maastricht, in the form of narrow interpretation and strict compliance, have given added importance to the fiscal convergence criteria - an importance for which there is no basis whatever in the Treaty and no economic justification. But it should be made quite clear that a stable monetary union is not necessarily tied to strict observance of the stated quotas. Rather, the issue is the direction thus indicated in which the budgetary policy of the individual Member States should move. Precisely that can be seen happening everywhere: budgets are being consolidated, excess government deficits are being reduced. Even today, the gap between the highest and lowest deficits among the EU States has become significantly narrower, and that trend must continue.
In conclusion, I should like to say that a debate on whether to have monetary union would run counter to the present trend of a changeover among banks and small- and medium-sized enterprises, and that I greatly welcome the way today's debate is being conducted!

Ewing
Mr President, I would like to remark that one Member of this House, Mr Goldsmith, who rarely favours us with his presence in debates on economic matters or indeed any matters at all, has said with huge media coverage that Europe is sleep-walking into EMU. I consider that to be a gross insult to this House, to all the rapporteurs, to the Committee on Economic and Monetary Affairs and Industrial Policy, to the President of Ecofin and to President Santer and the Commission.
I would perhaps rather describe our progress as zig-zagging, because if you look at the statements that were made, five States were said to be eligible, then it was four and recent coverage has suggested only two. I would like to congratulate Ireland on having become the tiger economy of Europe and of being able to qualify. Now my Group and my party in Scotland is in favour of EMU. We consider it absurd to have a single market without the accompanying single currency.
I have the speaking time of Mr Sainjon who was taken ill, and I have agreed to say one or two things on his behalf. He wants to see a single currency working to create employment, and Europe must concentrate its efforts on meeting this objective. The euro must be regarded as the engine driving economic and social progress. He says it represents three things for Europe today. It will help to consolidate peace in our continent and among our peoples, of course any government moving in the right direction should be able to join, and we must watch that we do not overvalue the euro and so destroy a lot of our aims.
All the reports are excellent. Starting with Mr Metten, I like the confident note in his report. He is confident that at the third stage we will start with a sufficient number of Member States. He also points out that an arithmetical application of the criteria is not possible, and if applied there would not be a sufficient number. In his explanatory statement he points out we could either do this with a big bang or we could do it in the way we are, converging first and then creating the Union.
So we come to the need for flexibility which other speakers have mentioned. This changes. For instance, Denmark, which meets the criteria, has an interest rate 1 % higher than some states that do not meet the criteria. So it looks as if we still have some questions to be answered with regard to exactly what flexibility means. When is a decline in deficit substantial? When is a debt sufficiently diminishing? What is a satisfactory pace? Is there any limit to flexibility? If we take Belgium's debt as being twice the permitted or suggested amount, would there ever be any limit to be imposed or are we just going to say if we are moving consistently and continuously in the right direction the state can qualify? Is there any threat to the date of 1 January?
I would like to congratulate Mr Christodoulou on taking on board the economic aspects, the quest for job creation. That was not always the attitude when I lodged amendments to that effect a year ago, but the groups seem to have come round to that.
With regard to the stability pact, I have a question for the Commission. Are they going to make proposals for the surveillance of the 'outs' ? Are we going to treat Britain with an opt-out in the same way as other 'outs' who want to get in? If Britain does not want to get in and uses the opt-out, which I deplore, are they in the same position? How many years will the surveillance obligation to report annually continue?
I agree with Mr Donnelly's speech in its entirety and particularly his plea that we do fall into the trap of the proposed German strait-jacket.
I would like to congratulate Mr Herman on his passionate speech and on his need to inform, prepare and reassure. Is it not deplorable that in the State I belong to there is almost no attempt to inform? They seem to have opted out of that obligation. I would like to again repeat a point I have often made about public acceptability of this new currency. I suggest and cling to the idea that one side of the note and coin should be similar to the existing issuing notes that are issued by banks. That would go a long way to make the public feel that this was their currency.
In Hoppenstedt, which follows on Metten, he repeats many of the demands and expresses his regrets at some of the statements that are being made that States have to make savings because of Maastricht, that the European ideal has been undermined. Mr Harrison I thought made his paper very clear and come to life when he emphasized the need for a policy mix between centralized monetary policy and decentralized economic and employment policies. He mentions in his explanatory statement the rather bad example that followed German unification when a wrong mix of policies caused great hardship indeed. Mr Harrison explained his report very clearly.
On the doom-and-gloom side of loss of jobs, I wish the people who talk about the loss of jobs would tell us how exactly the jobs are going to be lost. They say this so often as if it is a fact. The media in Britain say it all the time. Will there not in fact be extra jobs? One speaker talked about the need for training. There will be the need for computer adjustment, certainly at the beginning there will be some extra jobs. So would we please pin those critics down.
For exporters, and my country Scotland exports six times as much per head as most other countries, the markets will be more calculable and comparable the tourists will benefit and we will remove exchange costs of ECU 25 billion.

Randzio-Plath
Mr President, today's monetary debate once again emphasizes that this European Parliament not only insists upon the democratic accountability of monetary institutions and authorities but itself genuinely endeavours to adopt a position which furthers the implementation of monetary union. I should first mention the European Currency Act, where I am glad to say that both the Commission's drafts make it very apparent that we want the euro to have a clear legal status - more legal certainty and transparency. The continuity of the Treaties is a very important signal for us. Most of all, I welcome the fact that the Commission has tackled these projects in good time, as it was called upon to do in Madrid, and indeed in the Green Paper before Madrid. We want the public, and the markets too, to be able to adjust to monetary union in good time because, of course, a badly prepared project is a bad project, while a good project must be in all our interests.
With regard to the European monetary laws, if I may so call them, I should like to emphasize that they will be an important instrument for getting the message across to the public and to the economic actors that monetary union is coming. It really would be a good thing if these regulations - rather than just a subsequent regulation - were to make it completely clear that the transaction costs that monetary union is going to do away with are not suddenly going to crop up again in the form of conversion costs in the reality of the single European market - the reality of European monetary union. I think it is very important to be clear about that. It also needs to be completely clear that dual pricing is not only an ideological objective but a necessary step to keep the promise we are constantly making to the public that monetary union will be a technical currency conversion, with no effect on value, and not a currency reform. That means, obviously, that we must talk to the main players about the form that dual pricing is to take, to make it as clear as we can to all concerned that prices are not going to change because of the Euro and the introduction of the single currency. We need monetary union, but - as well as making it clear that prices are not going to go up - we also need to enable people to learn a new price awareness, a difficult psychological process but one that is necessary for the success of monetary union.
Let me also say something about the other projects. It is right that everyone is stressing the independence of the central banks. It is right that the reports - the Hoppenstedt and Harrison reports, for example - also stress the need to develop ideas in monetary policy which reflect our other objectives and can be integrated into a better policy mix. But now I come to a problem: I would certainly like all the projects to be adopted by the Dublin Council of European Heads of State and Government, but I would also like the stability pact to be adopted, as we in the European Parliament call for it to be adopted. Because one thing is clear: a European stability pact that is not concluded by all fifteen Member States, or a European stability council which is not a forum where all fifteen Member States can express an opinion, would be the monetary equivalent of Schengen, something which we in this House reject. After all, we cannot demand a new European exchange rate mechanism to provide a link between the euro and the other currencies while, at the same time, trying to introduce the possibility of a new form of exclusion! That must not happen at any price, and that must be made completely clear! Similarly, my view is that the German Government must unfailingly comply with the European Parliament's demand that no quantified deficit objectives should be written into the stability pact, because, as I see it, not only would that be politically senseless, not to say damaging, but it would also be economically dubious.
There would also be a problem if the Maastricht Treaty were to be amended, and in my view that would not happen at all without the ratification procedure. So I should be very glad if the Council and Commission felt able to adopt the ideas in the European Parliament's proposal regarding the stability pact.

Areitio Toledo
Mr President, Monetary Union, which is to come into being on 1 January 1999, is a decisive and irreversible step on the road to European integration. Consequently, it is the duty of the Commission and of this Parliament to guarantee the security and credibility of the path leading us to that Union and also its soundness and stability once achieved. The Council is shortly to make a pronouncement on three aspects, which are still to be defined, which are fundamental elements of the credibility, security and stability of future Monetary Union. I refer to the stability pact, to the definition of the future European Monetary System between the euro and the currencies of those Member States not participating in monetary union and the legal scope of the euro.
It is not my intention to speak about the first two aspects, since these have been discussed in previous interventions. I shall restrict my contribution to the third aspect, which is the subject of Mr Herman's report which we are debating today. Council regulations relating to the introduction of the euro have a single objective: to give legal security to operators in their financial and commercial operations throughout the process of introducing the euro and the progressive disappearance of national currencies both before and after 1 January 1999. In this sense, we feel the approach is the right one. However, it could be improved in legal terms and we support the amendments Mr Herman proposes in this connection in his report, and we believe that it should be strengthened by a second objective - the objective of offering security and transparency of information to consumers and citizens to explain how their national currency converts into the euro. This is undoubtedly the spirit and substance of the amendments proposed in the Herman report, which we support.
Planned Monetary Union requires everyone to make an unambiguous pledge to the citizens of Europe. The change has to be explained and it has to be made easy. The changeover to the euro must not make anyone uncertain about continued purchasing power and everyone must be capable of understanding the need to offer and conduct transactions expressed both in euros and in their national currency for a certain period.
Commissioner, this endeavour will not end with the approval of these regulations but must commence from their approval, with cooperation and commitment from all Member States. We must not forget that this is a new currency for all citizens and that society's attitudes and behaviour are not modified by the mere publication of the Official Journal. We are well aware that the Commission intends to propose a directive on this subject but we believe that a directive will perhaps be insufficient. We ought to be speaking in terms of a genuine mobilization plan - this House would undoubtedly welcome the opportunity to discuss this with the Commissioner.

Giansily
Mr President, Commissioner, ladies and gentlemen, within the framework of Mr Metten's report, pursuant to Article 109j(2) of the Treaty, Parliament has forwarded its opinion to the Heads of State and Government on whether a majority of the Member States fulfil the necessary conditions for the adoption of a single currency. I should remind the House that the Heads of State and Government decided, at the European Council in Florence, that the assessment called for by Article 109j of the Treaty will not be needed.
Be that as it may, the revised and more realistic version of the report calls for no particular comment, and our group should be able to vote in favour of it. It is still true, incidentally, that a very restrictive interpretation of the convergence criteria would keep a number of Member States outside monetary union, resulting, at the worst, in a major split in the single market, and might encourage a sudden sharp rise in the value of the euro, whereas a more balanced interpretation would reduce the risk of a split in the single market, thus reducing the grave danger that an overvalued euro would represent.
With regard to the Herman report, the legal status of the European currency will have to be such as to ensure the irreversibility and credibility of the process but also such as to avoid the excess costs resulting from a dual national/euro currency system. In other words, we will have to avoid the legal coexistence of the euro and the national currencies. So it will be preferable for the euro to be the only legal tender with effect from 1 January 1999. Similarly, there is a consensus to the effect that the legal continuity of contracts must not be affected by the introduction of the single currency, and that is as it should be. After all, within the framework of an internationally applicable monetary law, we should recall that every State has the sovereign right to define the characteristics of its currency and to define and vary the rate at which the old currency is converted to the new. Well, the European regulations now being finalized should be a law of that type, so that the universally recognized principle of monetary nominalism will apply.
With regard to contracts that are subject to the law of a third country, the introduction of the euro must, once again, not be seen as a challenge to the equilibrium of the contracts. Overall, then, the problems posed by the continuity of contracts seem less complex than had initially been thought. But it is also quite conceivable that defining the legal status of the euro will be a difficult business, at least for the transition period. Among the Member States, the sticking point at present is defining those exceptional and temporary circumstances that would enable a State to escape the system of sanctions if its budget deficit were to exceed the imposed ceiling of 3 % of GDP.
Our group will, of course, lend its support to Mr Herman's report, but even so I think it worth recalling that it is the monetary law that will define the name of the Union currency, so that there is no need for us to dwell on that.

Watson
Mr President, I welcome these reports which we are debating today. There is no doubt that we are on track to the single currency. It will make the internal market work better, creating wealth and jobs. It will reduce interest rates for countries such as my own and for our citizens it will represent a tangible symbol of European unity.
The Liberal Democrats in this House believe that as time goes on the well-drafted parts of the Maastricht Treaty are proving their worth. The convergence criteria and the rules to counter excessive deficits, for example, are among these and must be respected. In my Member State there is a rather strange situation at the moment where members of the governing party are worried that they are about to get a dose of their own medicine. They have removed financial independence from local government in Britain. They have capped the spending of local authorities which have spent more than the government thinks they should and they now fear that Britain could have fines imposed on it in a similar way if it exceeds the limit of 3 % ceiling on GDP, like some rate-capped miscreant local authority. Perhaps if those members stopped behaving like councillors in the London Borough of Wandsworth they would have less to worry about.
I have two specific questions I should like to put tonight, one to the Council and one to the Commission. Would the President-in-Office of the Council confirm that Monday's Ecofin will not take decisions, as was reported to the British House of Commons yesterday? Would he also confirm that Article 103 excludes any possibility of fines or penalties being imposed on countries which do not join stage 3 of monetary union?
Would the Commissioner confirm that policies adopted by the Member States for collection of Community-based taxes like VAT and excise duties in their rush to bolster their public finances do not contravene the Treaty requirements to treat Community-based taxes in the same way as Member-State-based taxes. I should be grateful for an answer to those questions tonight.

Bertinotti
Mr President, Commissioner, ladies and gentlemen, I must confess to being somewhat disconcerted on reading these reports. When I see the extent to which they disregard the real processes taking place in the various countries, and in Europe as a whole, it is as if the intention were to create a fog of abstract relationships between abstract economies, a fog in which the reality of people's lives, their real situation, has disappeared. Thus, monetarism celebrates its triumph in a situation which sees the disappearance not only of social considerations but even of relationships between currencies and growth or stagnation, industrial development policies, even economic trends. But as soon as we blow away that fog to see what lies behind it, what do we find? We find the relationship between the economic policies pursued hitherto and their consequences - a deep-seated social crisis; the relationship between the pursuit of those very convergence criteria which are once again being proposed, the policies designed to balance national budgets by controlling deficits and indebtedness which have been the sterile end result of those economic policies, and the serious problems sweeping Europe: massive, structural unemployment; an assault on the bases of the welfare state; deregulation of the employment market; constant rescaling of the purchasing power of wages and salaries.
The time has come to see the error of this approach, which lies precisely in its own political and cultural environment. There is an unspoken assumption in these reports, which is the assumption that the relationship between Europe, the single currency and Maastricht really all boils down to Maastricht: Europe ceases to exist as a political and planning arena, and the single currency is simply squeezed and distorted until it fits Maastricht, so that even the stability pact is viewed as an intensification of these trends. Now some slight degree of flexibility is conceded as a way of rapidly achieving the objective of the single currency, since it is absolutely obvious that that objective cannot be achieved without a critical mass of European States: a mere two or three would not be sufficient to achieve it. But what is being permitted today, a certain amount of cosmetic surgery on the budget of each State, will tomorrow be squeezed again, perhaps even under threat of sanctions, for any State which does not succeed in complying with them.
So we will be left with an even more severe monetaristic logic, calling into question European civilization as such. So if we really want to talk about a single currency associated with a positive solution to the real problems of European economies and social conditions, we need to have the courage to separate out what can be separated - in other words, the procedure for approaching the single currency - from the policies of the Maastricht Treaty, by putting on our agenda the one thing that is essential unless we really want to see the European currency achieved by bringing European civilization to its knees: the amendment and correction of the Maastricht Treaty.

Hautala
Mr President, I should like first of all to say a few words about the Metten report. In his recommendation he tries most commendably to ensure that as many countries as possible can proceed to the third stage of EMU at the beginning of January 1999. Our Group too considers it a precondition for the third stage that as many Member States as possible - at the minimum, a majority of them - should be able to proceed to it.
However, it is not entirely unproblematic in this connection how it proves possible to solve the equation: the solution proposed is that the convergence criteria be interpreted non-arithmetically. This could also be described as creative interpretation.
However, I should like to draw attention to the fact that, for example, the Director of Eurostat has said in Parliament that there are many grey areas in the Member States with regard to efforts to reduce budget deficits and that all should be clarified before 1998 so that equal treatment of all countries can be ensured. One example is the inclusion of the French state telephone company Telecom's pension funds in the calculation of France's budget deficit. Using tricks like this really will not result in a stable currency.
I should like to put the following questions to Commissioner de Silguy: is it intended that grey areas and various tricks should be assessed as a matter of urgency? Are we not already heading towards a situation in which the stability of the future European currency will be in doubt?

Blokland
Mr President, the debate on Europe and the fact that it is being held in the European Parliament are strangely linked by various factors. Let me illustrate my point.
Parliamentarians complain that Member States are subject to enormous savings 'for the sake of Maastricht' . That does not make the concept of Europe more attractive. But the real reason is that EMU must be implemented at all costs according to the planned schedule. The strange thing is that the European Parliament is also going along with that idea.
The national budget policy of the Member States is currently aimed at fulfilling the convergence criteria. To this end some countries are performing accounting contortions which are incompatible with the objectives of real convergence, which is a veritable time bomb under the solid character of EMU. But strangely enough this is scarcely mentioned in this House.
Amendment No 15 to part II of the Christodoulou report is very strange. It assumed that Greece should be given special treatment because of its higher expenditure on defence. So can the Netherlands also be given exceptional treatment on the grounds of the high expenditure needed for dikes and coastal protection work? Our Oosterschelde dam costs eight billion guilders. Other European countries have other kinds of problems. This kind of discussion illustrates how unsuitable a monetary union is for the European Union.
Finally, is it not rather strange that during the hearing Mr Duisenberg asked that parliamentary representatives participate in the future ECB Council or that confidential documents be sent. Some Members cannot warm to the idea of an independent central bank. But strangely enough they are in favour of the euro. I have yet to meet a member of the public who has any confidence in this whole business.

Hendrick
Mr President, I would like to thank the rapporteurs on these monetary reports. They have done an excellent job and have covered all the aspects which will be discussed in Dublin. They have given a very balanced opinion on how we should give guidance to the Commission and the Ministers in Dublin.
I start from the premise of why do we want a single currency. There are 20 million unemployed across the European Union. We want improvements in the single market and, as has been said before on many occasions, with something like 20 million small and medium-sized enterprises across Europe and 20 million people unemployed it does not need a mathematician to realize that if every company took on one extra member of staff, unemployment would be slashed right across Europe. If you ask industry what economic conditions it needs in order to take on another worker, it will say that, firstly, it wants low interest rates so that it can borrow to invest. Secondly, where trade is across national borders it wants protection from exchange rate variations to improve trade. Thirdly, it requires a stable currency which can go anywhere in the world. Obviously the answer to this is the euro and the euro will boost many industries across Europe and help improve the job situation as a whole.
An area close to my heart is that of tourism. I have the honour to represent an area in the north-west of England, Blackpool and Fylde which is very dependent on tourism. The euro will benefit that. 20 % of economic activity in Europe is directly or indirectly related to tourism. Another area which is very important and again a key industry for Europe is the aerospace industry. This is a large industry in my own constituency in Lancashire and we have the ludicrous situation at the moment where European companies are working closely with one another but all orders for aircraft are made in dollars rather than in Member States' own currencies or in the euro
How do we get there? Clearly, we do so by having a stability pact which will maintain discipline between Member State budgets. This pact should not have rigid rules but should at least encourage stability. I do not think fines should be imposed automatically. A new ERM is essential but should not be a prerequisite to moving to stage 3. The UK has problems, mainly political and not economic, which I am sure will be sorted out with a change of government and we will then see the UK ready to move to stage 3 under a socialist government.

Secchi
Mr President, Commissioner, ladies and gentlemen, there are a few further thoughts I should like to contribute to this extremely important debate, thoughts prompted by the fact that the globalization of financial markets is meaning that economic convergence between the Member States is indispensable even if only to guarantee a balanced growth of their financial markets without drastic consequences for the real economy.
This situation simply must not be a one-off type of result, but must be guaranteed on a permanent basis. Hence, even without the forthcoming single currency, respect for convergence criteria and some kind of stability pact would be necessary in any case in order not to expose the European economic system and its market - which are more and more closely associated - to the dangers of a shock effect which would have all kinds of serious consequences.
However, the convergence criteria and the stability pact are suffering from an approach which I would venture to call an accountant's approach, a purely quantitative one, which does not consider the root of the composition of the resources entering and leaving public budgets but is confined to examining them in terms of balances. As far as income is concerned, the European Parliament has already on previous occasions - for example, recently, in connection with the single market - not only shared the Commission's concerns regarding the adverse effects of the discrepancies between the Member States and the fiscal competition existing in many sectors but also expressed the opinion that the future of European economic policy will be dominated by a serious imbalance between a common monetary policy, budgetary policies strictly coordinated by the stability pact and diverse, uncoordinated taxation policies.
The need, therefore, is for an approach which is much better coordinated between the Member States, an approach which must of course come into being by stages, and in my view the same requirement also exists for the macro sector of public spending. This, in the various Member States, not only raises frequent problems of a comprehensive nature, associated with the need to make the role of the State within the economy less cumbersome and to release resources for the market, but also causes distortions within the more important sectors of public spending - welfare, health and public-sector employment - which, with their automated systems and rules, distort spending in such a manner as to make the stability pact either lacking in credibility or a politically intolerable strait-jacket for many countries.
In conclusion, we would point out the need to proceed with clear-headedness, both as regards the problems of coordinating tax revenues and as regards the need to compare different forms of coordination, although the subject is a very difficult one as regards the make-up of public spending.

Hyland
Mr President, a single currency should result in lower interest rates in many parts of the European Union. The Irish pound, as one of the smaller currencies in the Union, has sometimes been subject to external pressures which in turn resulted in very high interest rates. The prospect of Ireland entering a large currency zone capable of withstanding external pressures is one which will be welcomed by most Irish people.
One of the biggest costs confronting small and medium-sized business, where the bulk of today's jobs are to be found, is the cost of servicing the capital which is being borrowed to fund such things as product development or property and equipment purchases. Taking out a mortgage to buy a house is usually the largest and most expensive personal financial commitment entered into by most people. Interest rate fluctuations have meant that borrowing for business expansion or house buying has proven to be a very risky undertaking, often resulting in bankruptcy or house repossessions when interest rates have drifted above the average levels.
A single currency should encourage lower interest and mortgage rates and in the process allow small and mediumsized businesses to operate in a more stable environment and also reduce the pressure on home owners to service their mortgages.

Moretti
Mr President, on the evening of Sunday, 24 November 1996, the extraordinary Council of economic and finance ministers worked flat out to arrange for Father Christmas to visit the Italians a month early, and to come up with a brilliant solution - fixing the lira within the exchange mechanism of the European Monetary System at a rate of 990 to the German mark; it may be remembered that the lira exchange rate a few weeks earlier was 1010-1020. This is a worrying development, bearing in mind that this decision will significantly reduce the former encouraging prospects for exports from northern Italy. Not only that, but these moves impose a further penalty on the incomes of small- and medium-sized enterprises, already persecuted by a perverse tax system - they are going to have to think about their futures and about how to live with an unfavourable exchange rate.
Despite an unfavourable economic climate, the European Union has made significant progress towards monetary convergence in 1996. If progress continues at the same pace, virtually all those Member States who wish to do so will be able to join Stage Three of European monetary union on 1 January 1999. There is no lack of imagination in the European Union, but there is no concreteness either: the stricter the interpretation of the convergence criteria and the other significant factors, the smaller will be the number of Member States joining, and yet - I must emphasize - the interpretation will once again be a political decision, taken by a two-thirds majority of the Ecofin Council.
What scale can be used to quantify the problems of unemployment, of the cost of running the country, of interest rates and of inflation - which, in Italy, has reached an all-time low only as a result of reduced consumption? The determination of every state to become a full member of Europe will not be enough, even the 'Euro-tax' proposed by Italy will not be enough. It is essential that all States should subject themselves to rigorous and previously agreed choices, including their tolerance margins.

Ribeiro
 Mr President, this set of reports by the Committee on Economic and Monetary Affairs and Industrial Policy is highly significant and reveals the times we are living in, in terms of concepts and approaches. Just because I am a politician does not mean that I have forgotten my training and professional experience as economist and economics professor. I am therefore particularly sensitive to the strong winds currently blowing. Indeed I find it difficult and am hard put to take part in this work and assess documents that are transformed into motions for a resolution apparently aimed - judging by their titles - at dealing with the real economy yet ending up with the wood invisible for the trees, i.e. words and concepts such as interest rates, exchange rates, capital markets, inflation, monetary mass, single currency, the statutes and structure of the European Central bank, excessive budget deficits and other nominative aggregates, with no reference by anyone to the use of resources, the employment and deployment of production factors, the degree of meeting social needs, rates of economic growth, economic and social development, the distribution of income, living standards or the well-being of our peoples.
Ten years ago the Commission introduced to the Community playing-field the notions of nominal and real convergence and went through a stage of mixing the two up, confusing economic with nominal, and ending up with a pot pourri or having regard only for nominal convergence, even when the titles of documents seem to suggest the opposite.
It is also interesting that, with the real economy forgotten, these reports reflect the very contemporary concern for flexibility, without spelling it out, something which for years and years was presented as intransigent inflexibility leaving absolutely no room to manoeuvre from a single transnational strategy and single monetary and budget policies. But that was not enough! Not without paradox, we leap from flexible assessments to even greater inflexibility on the basis of stability pacts without any regard for the effects on the real economy. Has the latter not yet been exterminated?
These reports are typical of the times - they are fashionable, appropriate and obsessive. But other times are around the corner...

Wolf
Mr President, ladies and gentlemen, it is beneficial to have all these reports, providing the opportunity to broaden our consideration of the problems of European monetary union, extending the range of questions and discussing them on a more differentiated basis. At the same time, though, one result seems to be that honourable Members find something better to do, and I find that a regrettable response to such a fateful question.
At any rate, the bottom line is that we in this Parliament reject Waigel's notions of simulating strict compliance with the criteria with a European straitjacket designed to replace economic policy throughout the future EU with a purely mechanical book-keeping apparatus. Mr Ribeiro is right: we must seek out new ways of achieving the objectives of the Treaty to enable us to measure EMU against Europe's real needs - combatting mass unemployment and overcoming the environmental crisis. We constantly refer to these objectives as our highest priority, without really suiting the action to the word.
The reports contain a number of things on which we can agree, but there are also unresolved questions that are not dealt with: employment problems caused by precipitate budgetary consolidation, saving until there is nothing more to save, taking account of criteria for real convergence that go beyond Mr Christodoulou's sensible approaches. There is no reference to the need for binding transnational rules in the social and environment sectors as a precondition for viable economic growth in real terms. Nor is a word said about the various dodges, offsetting of pensions and budgetary fudges that are being used to simulate compliance with the criteria so that, ultimately, the problems will be carried forward unresolved into monetary union.

Blot
Mr President, ladies and gentlemen, sometimes we have to reconsider the most basic questions. Who, today, actually wants monetary union? The public don't seem particularly enthusiastic, as far as I know. Where are the citizens' petitions calling for monetary union as a matter of urgency? Where is the public clamour for it?
The fact is that this project has its origin in cosmopolitan ideologies aimed at doing away with national identities. And the driving forces behind these ideologies are the Christian Democrat and Socialist governments of most of the States of Europe.
The second set of protagonists in this business are the big multinationals, always anxious to nibble away at the existence of independent States that might oppose their decision-taking methods. Finally, the United States are involved in the same process, because they would rather exercise control over a single European contact than several different national ones. So there is a political intent behind this business, no doubt about that, but there is no economic necessity. Is monetary union economically necessary?
The lessons of history tell us that it is better to have a currency which is used only in a limited territorial area but is adapted to the economy of that area - as is the case with the Swiss franc, for example - rather than a currency which is valid throughout a continent and is more or less soundly managed. The lessons of history tell us, too, that newly independent countries immediately create their own currency - which is surely not a matter of chance - and often do so successfully, as in the case of Czechoslovakia, or rather the Czech Republic, or Slovenia or Estonia. And now, in a period when the creation of new currencies in Eastern Europe is endorsing the coming of independence and freedom, we in the West are planning to eliminate our national currencies. There is a paradox here!
So what are the principles by which we might be guided today? The Hoppenstedt report rightly says that the introduction of the euro cannot go ahead against the will of the citizens, which in our view means that it can only be introduced if popular referenda give the go-ahead to the national governments. Genuine democracy must be our first guiding principle.
In any case, the process of economic growth is, by definition, a process of evolving differentiation - of divergence. The policy of convergence pursued with a view to monetary union runs counter to this natural reality. Life always means divergence. Convergence is for cemeteries. So we need to choose between two priorities. Either we go ahead with monetary union at any price, accepting low growth rates, which means convergence, which really means sclerosis, or we go looking for strong, sustainable growth with full employment, in which case we have to abandon monetary union as something that is not necessary.
Since 1945, growth in Europe, when it was strong, was always based on a variety of currencies. The United States, at that time, had a single currency and yet a less rapid rate of growth. So there is no relationship between economic growth and monetary union. Our second principle, then, is to give priority to growth rather than to European monetary unification.
And our third principle is that it is dangerous to hand over more and more power to the international technocratic authorities. It follows that the present process of monetary union is antidemocratic, antisocial and antinational.

Katiforis
Mr President, ladies and gentlemen, our congratulations to the rapporteurs must on this occasion be much more than formal. This debate in the European Parliament is truly historic, although judging by the attendance one might not think so.
Our rapporteurs have done very substantial work, and two of them, Mr Herman and Mr Christodoulou, have been under an unacceptable pressure of time which must not happen again. Having said that, I would like to endorse Mr Donnelly's comment about this being an historic debate and Mr Herman's inspired words emphasizing the momentous nature of this occasion as we observe the single currency moving closer to reality. I also think that congratulations should be extended to our man from the Commission who has laboured like few others for this common objective of ours and who will continue to do so until the project reaches fruition - at least I hope so.
Our satisfaction would be far greater if only, along with the progress on monetary union, there was some parallel success in the reduction of unemployment and in the limiting of regional inequalities for us to welcome, as there ought to be. These things are self-contained objectives to which the European Union attaches great importance, especially the reduction of unemployment, which we have elevated to the status of the number one problem - though in words only I fear -, and they are by no means unconnected with the success of the single currency.
Unfortunately, in these areas, in both of them, unemployment and regional inequality, the situation is far from good. The recent report from Commissioner Wulf-Mathies informed us that the reduction of regional inequalities has come to a halt, and as far as unemployment, which has grown by 60 % in Europe over the last 30 years, is concerned, Mr President, there is no sign of a recovery. The worst thing of all is that our progress to the single currency has become identified with a certain kind of budgetary policy which is exacerbating the real problems of unemployment and regional inequality for no good reason.
They say that this restrictive budgetary policy is necessary as a means to getting on top of inflation. What inflation? No one on this side of the House is in favour of inflation, which hits working people first and hardest of all. But with average inflation in Europe stable at around 2 % - leaving aside Greece which has very high inflation, but for only a little longer I hope - the invoking of the need for price stability to justify continuing with a stiflingly tight budgetary policy smacks a little bit of the general staff plans that were devised for the battles of World War I. And we all know what happened to the armies which relied on those plans. It is particularly worrying that the Commission, instead of contemplating a new policy, seems to be thinking in terms of making these measures even more stringent, if that is possible, via the stability pact which the Christodoulou report deals with specifically. It has got to be taken on board, Mr President, that in making the 3 % deficit over the reference value an absolute maximum the stability pact effectively revises Article 1 of Protocol 5 and establishes a new reference value of around 1.5 %. It should also be pointed out that government investment expenditure is not excluded from the calculation of the deficit, which is a violation of the spirit and, in part, of the letter of the Treaty.
I hope that at least the request by Mr Christodoulou that forced expenditure on an expensive arms procurement programme for defence purposes by a Member State will be recognized as an exceptional circumstance. That, however, is a special issue. The basic issues, Mr President, are the doubtful legitimacy of the stability pact procedure and the fuelling of unemployment that it will bring with it. Of course, a number of Members and the representative of the presidency have maintained that high employment and low deficits are entirely compatible. In a static world in which all economic indicators remained unchanged year after year, in which capital was not accumulated, in which no one was born and no one died, they would be. But in the real world in which we live, the evolving dynamic world, anyone who maintains that the deficits can be reduced to zero without unemployment being fuelled is being dangerously irresponsible.
Mr President, we have to move forward to the single currency, but in doing we must show sensitivity towards the working people of Europe. The single currency venture needs to have them with it and not against it, because in the final analysis it has to be in their interest. Let it not begin its career by damaging them.

Peijs
Mr President, the present period of the run up to the EMU is extremely important. Now is the time for us as Parliament to give a clear signal to the public and to the financial markets on the future of the euro and conditions which this currency should fulfil.
And that brings me to the Metten report and the following question. Should we be aiming at a balanced budget or can we accept deficits of more than 3 %? The report stipulates that a debt of more than 3 % should be acceptable. The rapporteur claims that the advantages of this would be greater than the risk of increasing inflation in Europe. That I very much doubt.
And had we not agreed in the Christodoulou report that we should be aiming at budgets which are pretty much balanced or in surplus? I think that Mr Metten's approach creates only confusion. The criteria in the Treaty are clear enough. A deficit of close to 3 % comes under the criteria of the Treaty and should not therefore create any problems. And then the stability pact also clearly stipulates a maximum of 3 % deficit unless under exceptional and temporary circumstances.
The big question is of course what message Parliament wants to send out with this document. But I think the least it should be is a clear message that the convergence criteria guarantee a sustainable and stable EMU. Even if the interpretation margin in the criteria is used it does not mean that the sustainability of the EMU and the currency are at risk. However, the necessary degree of flexibility has two sides to it. Not only does it mean that a Member State may allow a public deficit of 3.1 % for example, because the trend behind this figure is reassuring, but it also means that a Member State that reduces its deficit to 2.8 % through all kinds of one-off artificial measures may not meet the criteria.
And then the stability pact, and here I would like to take a closer look at Mr Christodoulou's report. I think that the two important issues of the scope of the sanctions and the definition of the exceptional and temporary circumstances should be defined as quickly as possible. Negotiations on this have already become stuck on several occasions. But to assure the necessary certainty and a stable currency and to prevent endless discussions after the event these still unclear concepts must be properly defined.
Another matter is the parallel pricing, in the Hoppenstedt report. Intensive talks with the retail trade have convinced me that a legal obligation on parallel pricing is not a good thing. I was originally of a different opinion and have been persuaded by retailers that there are many other ways of solving the problems which consumers will face. I think we should be moving towards a system of full information, but excluding a legal obligation on parallel pricing.

Gallagher
Mr President, at the outset I wish to congratulate the rapporteurs and say that they have made an excellent contribution to the single currency debate. From an Irish perspective, the real debate relating to the introduction of a single European currency is whether Ireland should join such a monetary union if Britain declines to sign up to EMU membership. The crunch decision is only around the corner. Early in 1998 the Council will decide which Member States will qualify for EMU based on the updated economic statistics for 1997.
It is clear that Ireland will be in a position to join the first tier of European countries which will participate in the new European single currency. This is due to the fact that our debt/GNP ratio is decreasing annually and that our economy has been growing at a steady rate since 1987 with the assistance of two European structural fund programmes. The Irish Government should commit itself to acceding to a single currency whether Britain joins or not. Since 1960 there has been a major change in the pattern of Irish trade. Our trade with the UK has dropped dramatically and, conversely, our trade with mainland Europe has increased.
Aligning ourselves to the Euro will mean that participation in such a strong and stable monetary union will result in a reduction in interest rates in the medium term. The benefits of a single currency will include increases in terms of output, employment and trade.
In conclusion, I am somewhat disappointed that the Irish Minister only stays to listen to the rapporteur's reports and the contributions by the main spokespersons. I say to the President-in-Office that he should listen to all contributions.

Svensson
Mr President, the idea of monetary union involves three serious fundamental mistakes: it transfers power from democratic governments to a bureaucratic and closed institution and thus increases the democratic deficit in the Union. It is based on a policy of constant recession and it compels governments to do nothing in the face of social crisis, just like in Germany between 1930 and 1932. However, monetary union is also a mistake from the point of view of economics because it turns a mere detail of the economy into a matter of major concern.
A sound real economy comprises rising incomes, high and rising demand, high productivity and an active financial policy on the part of democratic parliaments and governments. Currency and interest rates which are here turned into matters of major concern and the driving force of the whole enterprise in a most remarkable way are in reality special factors which are entirely dependent on the above-mentioned major real economic trends. What this dogmatism, the Commission's conception of the importance of interest rates and currency, actually means is that one might justifiably borrow the words of the old populist US politician William Jennings Brian, in saying that monetary union will crucify the people of Europe on a cross of gold.

Martinez
Mr President, the reports by Mr Metten, Mr Herman, Mr Harrison, Mr Christodoulou and Mr Hoppenstedt have once again led us to talk of convergence criteria and the coordination of budgetary policies, so as to get the single currency rolling - rolling into the 'Euro-tunnel' .
At the heart of these public finances where this monetarist train is taking us, at the heart of these budgetary policies, the question which arises is this: can there still be any such thing as multiple budgetary policies, in view of the facts? What we are actually considering here is a single budgetary thought, with restricted spending and austerity on the expenditure side and increased taxation on the income side - Mr Prodi's tax for Europe, for example. We had the same budget in Italy, in France, in Spain and in Greece, with the same consequences: a million people demonstrating in Rome, the lorry drivers' action in France, and unemployment everywhere.
As this policy is obviously an unnatural policy, it has to be imposed. Hence the sanctions: the extension of Article 104c(9) to (11). Hence the novelty of a budgetary criminal law, with one improvement, that is to say the stability pact, the two proposals for a Commission Regulation, and fines. So when the monetary police stop a traveller in a state of budgetary intoxication he has to blow into a bag, and if the GDP reading goes beyond three, then the whole nation gets fined. And if the GDP reading is ever 0.5, one can imagine a nation sentenced to pay a fine of 80, 000 million francs a year in payments to the European Community. Why not? All of this, of course, with an independent central bank.
The little bit of the Eurasian continent that invented democracy is now rediscovering oligarchy in the board of directors of the central bank, with a feeble theoretical justification: the theory of rational anticipation, anticipation by the central actors. And supposing they had no confidence in the central bank, supposing it were under the control of the public authorities and there was a risk of the wrong kind of anticipation? In that case it needs to be independent, and out comes the sad little chart which shows that where central banks are independent there is less inflation. And there you are.
The only thing being overlooked is that everything depends on individual political histories. In France, we have the history of Vincent Auriol: lock the banks and lock up the bankers. And in failing to forget that history, we embark on a series of tragedies. The first, and most serious, is a neurosis transplant. Germany has a neurosis, brought to it during the Weimar Republic, and later confirmed by its reunification and the asymmetrical impact. Germany is afraid of inflation. Hence the courses of treatment, hence the Basic Law which makes the central bank responsible for ensuring price stability.
But France has a different neurosis - the neurosis of the social struggle, the class struggle. Just because Mr Kohl is overweight is no reason for Mr Juppé to go on a diet - we're talking about two different histories.
Another tragedy is the tragedy of the toboggan. The single currency implies a single tax system, otherwise monetary devaluations will give way to tax devaluations. And finally, the most dramatic tragedy of all is that the market is global but the single currency will only be European. No question of a single European currency in Singapore. No question of a single European currency at the end of the year 2000.
Mr President, to conclude, this is the tragedy of dead stars. By the time the light of a star reaches us, the star has already died. The European strategic star died at the moment when Europe was born. We are going back to the future, guided by black light.

Cot
Mr President, there are times when fate needs a helping hand. You, Commissioner, are hastening on to keep the deadlines laid down in the Maastricht Treaty. Your haste may be necessary, but it is not without risk. The European Council in Madrid recognized the need for legal security to form part of the introduction of the single currency. Mr Herman has reported to us on two regulations which tackle a number of problems. Our Committee on Legal Affairs and Citizens' Rights was unwilling to give an opinion in view of the rushed circumstances under which Parliament was consulted. Even so, it is concerned about a number of points which I would like to take up.
I am not sure, Commissioner, that legal security is sufficiently catered for by changing the name of the single currency, by the instrument of a regulation based on Article 235 and the technique of interpreting the Treaty. I think that tidying up the text of the Treaty might have been a better judged approach. That is the view of Mr Herman, whom I see nodding his approval. It is the view of my colleagues on the Legal Affairs Committee, and it was the view expressed, for example, by Mr Badinter before the French Senate on 6 October. You must agree that there is at least room for doubt.
You believe that the political risk of revising the Treaty is greater than the legal risk of the further procedures. I can understand that. But let us have no talk of legal security when what lies in wait for us is a storm of appeals whose results we cannot predict. In particular, the two Regulations say nothing about the essential problem of legal security for the consumer. They may meet the reasonable expectations of the banks, the exchange dealers and the other major economic actors, but they take little account of the man in the street.
Well, the legal problems are considerable. We come across them every day - we came across some yesterday, at the Legal Affairs Committee, in connection with a text on consumer credit. Let me quote a few at random: dual labelling, which has been extensively dealt with, cross-border transfers, price control and the introduction of effective appeal procedures for consumers who suffer damage, the penalization of counterfeiting within the single market but under fifteen separate criminal law systems, the possible revision of the directive on unlawful clauses, the criminalization of fraud. I might add to that list the ambiguity of the brief article devoted to contracts expressed in national currencies, as are the vast majority of contracts existing today.
These problems are complex, important and fundamental: because of the legal instruments of implementation, first pillar, third pillar, because of the difficult division of legal jurisdiction and political responsibility between the Community and the Member States. Yet there is no semblance of any answer to these questions in the texts we are considering.
What we expect from you today is not solutions but a commitment to particular methods, and a timetable. The legal security of the market operators is necessary, certainly, but we have no right to disregard the confidence of the ordinary citizens of the Union. That would be unacceptable and unwise. Otherwise, popular support for the euro, the importance of which was recalled just now by the President-in-Office, would melt away and we should be left with the disaster scenario which the previous speaker conjured up with such relish.

Porto
Mr President, the fact that we are drawing closer to the time for adopting a single European currency should be a reason for great satisfaction in terms of the gains and the security that should be brought. But at the same time a cause for paying even more attention to ensure that the process runs smoothly and is maintained well beyond the date when the euro is to enter into circulation. For Portugal, the benefits are especially sensitive as my country already has a very open economy, with a degree of trade openness exceeded only by the Benelux countries, Ireland and one of the Nordic countries, where small and medium-sized firms dominate, companies already especially penalised by the costs of transition, uncertainty and the calculation stemming from the existence of so many currencies in Europe.
I therefore very much welcome the fact that, as is acknowledged in a recent Commission report, Portugal should be able to enter the vanguard in terms of meeting the nominal convergence criteria set at Maastricht. This is the result of a successful attempt in recent years to bring inflation down from 13.4 % in 1990 - and it had been up to 24.7 % in 1985 - to 2.6 % in 1996, to bring the interest rate differential with the EU average down from 7 percentage points to less than 3, to bring the budget deficit down to 4 %, while public debt, albeit still more than 60 %, should fall further in 1996/. Although the unemployment rate did go up in 1994, it has been kept to just over 7 %, far below the EU average.
It should also be pointed out that this has been brought about despite a change of government from one party to a quite different one which, luckily for my country, is also set on and committed to the process of European integration. Representing more than 80 % of Portuguese workers in the wake of the recent elections where the process was at the heart of the political campaigns, it could be said that we can count on the strong backing of our people.
Even though Portugal is capable of joining the single currency it cannot stop being sensitive to the advantage for it and the European Union as a whole of allowing as many other countries to join as possible, as properly underscored in the Metten report, as the only way of avoiding the risks and disadvantages - competitive devaluations - despite prohibitions and set penalties, that some of those left out might be tempted by. That would help to strengthen the euro in the world economy and benefit all concerned.
A single currency, however, would continue to call for greater real approximation between economies. That is why it is in the general interest to ensure that the structural policies are continued and even strengthened, with less of a requirement of additionality, so that the efforts to be made by the various countries do not call into question the nominal proximity that should be kept up once the single European currency begins to circulate. This would also help to bring about the vital public acceptance of the euro which, apart from the costly awareness campaigns that we could be involved in, could be felt - in the wake of more realistic, stricter policies - as a factor of progress and social well-being.

Sjöstedt
Mr President, this afternoon we have debated monetary union, primarily in technical and legal terms. In actual fact, however, it is a highly political issue which, moreover, has not yet been fully resolved. There has been some talk here of the need for popular acceptance and to listen to the people, whereas we all know that a majority of the population in a great many of our Member States is today opposed to a common currency. If we are serious about listening to the people they should be able to say what they think in a referendum. I should therefore like to congratulate the British Labour Party, which has taken the step of saying that a referendum will be held; more countries should follow this example.
The common currency is basically a political project. There are very few strong economic arguments for monetary union. Some time ago the Swedish Government set up a committee of inquiry comprising prominent economists to look at the effect of monetary union on the Swedish economy. The committee's findings were presented recently. They reveal very small benefits but major economic risks. They point out in particular the probability of drastically increased unemployment. In practice it is today very unlikely that Sweden will initially participate in monetary union if it takes effect in 1999.
EMU is not simply a question of the future, however, it also affects our everyday life today. After all, the economic policy of EMU already dominates Western Europe now. The result is not impressive: falling growth, low growth and weak demand in the economy. The price being paid is high unemployment. The convergence criteria are being met by Member States making drastic cuts in social provisions and by unnecessary privatisation. The price for this dogmatic EMU policy is being paid today by the unemployed and by those affected by social cuts. If monetary union goes ahead it will mean the creation of a system beyond democratic control, where economic policy is decided on the basis of Treaty provisions, the stability pact and an independent central bank. What the voters think about economic policy when it comes to general elections, however, will no longer be of interest. This is why monetary union is the opposite of democratisation and this is unacceptable.

Amadeo
Mr President, the convergence criteria are being discussed today in an unfavourable economic climate, and that requires us not to stick to pure mathematical logic, because the stricter that logic is the smaller will be the number of Member States allowed to join. While noting an impressive level of nominal convergence, we should emphasize that, in point of fact, there are at least ten states which are not able to satisfy all the convergence criteria, criteria that are essential for launching the second stage of economic and monetary union. A strictly mathematical interpretation of the convergence criteria, then, would not only contradict the spirit of the Treaty but would make the path to monetary union more difficult. Not only that, but an excessively strict interpretation would result in a split in the single market and would increase the possibility of a rise in the value of the euro, while a more balanced interpretation would reduce the problem of a division within the single market and would lessen the risk of an overvalued euro.
There is also the fact that even Germany, which sees the problem of the single currency as the manifestation of Europe, is not able to meet the convergence criteria: in particular, during 1996, the ratio between gross domestic product and the budget deficit has been about 3.5-4 %. Let us not forget that France has incorporated the credit balance of a private para-State enterprise into the State budget in order to achieve the 3 % ratio between gross domestic product and budget deficit.
Let us not forget that unemployment, which has never before reached its present level of around 12 %, must not be further increased by raising the tax burden on manufacturing industry in the Member States, especially in Italy. That would bring about an economic climate which would certainly increase unemployment dramatically.
Therefore, either the convergence criteria should be amended or, better, the time frame for monetary union should be put back from 1 January 1999 to two years later. That is a realistic position, and a profoundly European one, taking account of the need to construct a Europe including all the most important and essential States, so that in future we may achieve not merely a tradesmen's Europe but a great Europe founded on a common foreign and security policy, the common struggle against organized crime and drugs, and economic cooperation.
The real Eurosceptics are those whose exaggerated ideas of stringency obstruct the formation of a political Europe, something that can only be achieved by the simultaneous integration of all fifteen Member States: the real Eurosceptics are those who want a two- or three-speed Europe, or a multi-track Europe. On that basis, the process of integration will drag on for ever, and the advantage of that will be felt not by the citizens of Europe but by those countries with the strongest economic and political lobbies, countries which - being totally consistent with their policy of defending the leadership of the United States - want to keep their business low-profile.

Caudron
Mr President, I want to use my three minutes on the completion of EMU and the introduction of the euro to say that I agree with the objective, that I am anxious about the methods being used, and that I have doubts regarding the results unless the economic and monetary union that is now coming into being is rapidly complemented by political and social union.
First, I agree on the objective. We must indeed complete EMU. We must introduce the euro in accordance with the planned timetable. That is the indispensable complement of an economic Europe, the single market and freedom of movement. I should add that the euro has the potential to be a fantastic vector of unification for the citizens of Europe, and a fundamental element of European citizenship. So, personally, as far as the euro goes, I am in favour.
Secondly, though, my agreement on the objective goes hand in hand with anxiety about the methods. An excessively strict interpretation of the convergence criteria and the lack of any political and social approach to that convergence are already proving to have two disadvantages. First, the convergence criteria are already being used as a scapegoat, taking the blame for every problem in every State of Europe. People say they are responsible for unemployment, and for the public service problems in France. Not only that, but these criteria threaten to exclude too many countries, especially all the southern States of our Union. What is needed, then, as others have said before me, is a less monetarist approach to the convergence - the necessary convergence - of our fifteen economies. I should add that a quantified, rigid stability pact would, de facto, introduce an additional criterion at the very time when what we need is a more flexible attitude to the criteria already decided upon and ratified by the Member States. Not only would that be an error, at a time when we are having problems in meeting the existing criteria, but there would even be some question as to the legality of such a pact in the absence of any further ratification by the national representatives of the 15 States.
Agreement on the objective, anxiety about the methods and, thirdly, doubts as to the results. Let us take care, ladies and gentlemen, as opinion increasingly swings behind the euro, that the European machine does not grind to a halt because of the ravages of unemployment and their effects on electoral decisions in our various States. Let us take care to avoid an excessively technocratic interpretation which would eliminate the southern States. Lastly, and most importantly, let us take care that our economic and financial union does not become the orphan child of political and, especially, social union. Between now and 1998, then, the IGC must create the political and social Europe of the citizen. And that, ladies and gentlemen, is a long way off as yet.
To summarize, and in conclusion, in order to achieve the widely shared objective of the euro we therefore need a more flexible approach to the convergence criteria, we need to avoid adding new criteria, we need to fight against unemployment and poverty and in favour of the public services, and above all we need to lay the foundations of a strong political Europe with bold, proactive social policies.

Pomés Ruiz
Mr President, the reports on future Economic and Monetary Union which this House will be voting on tomorrow are very important. In the short time I have available, I wish to refer to the Metten report and, in particular, to the suggested treatment of what is, in my view, one of the most important convergence criteria: the inflation criterion.
This criterion is not strictly accountable in the way interest rates might be. It is a statistical criterion, obtained by statistical methods. I would like to take advantage of the fact that Commissioner de Silguy is here in order to remind him that, in Germany, the rate of inflation is calculated in a simple non-arithmetic way. Bavaria's inflation is not the same as that of the small länder -city. Inflation is a weighted mean, in accordance with the size of each land . This is how the rate of inflation is worked out in Germany and in Spain, and it is the way that Eurostat works out European inflation.
It was precisely Commissioner de Silguy's reply, in which he suggested that this convergence criterion could possibly be calculated as a strictly arithmetic mean of the three best countries with the lowest inflation rate, which led me, together with a number of colleagues, to table an amendment on that subject, because the inflation criterion is an eminently statistical criterion and is not accountable. Just as Germany's rate of inflation is the result of a weighted calculation, the average of the three countries with the lowest inflation rate must also be weighted. We do not wish to relax the convergence criteria. What we do want is that there should be no interpretations made which are, as I see it, unnatural.
On 19 November, Mr Franchet, Director of Eurostat , gave the assurance that the formula he uses to calculate inflation is a weighted formula and that if he is asked he will give a weighted mean of the three best countries. Countries which are making a huge effort to comply with the convergence criteria are entitled to demand a fair interpretation, not an unnatural interpretation, on the part of the Commission.

Torres Marques
Mr President, ladies and gentlemen, we are taking part in a part-session in which matters of great importance for European citizens and Europe as a whole are being debated. I think that the creation of a single currency will be one of the strongest bonds, not only vital if we are to have a genuine European internal market, but also if we are to bring about economic recovery, investment and create jobs. It will be a symbol uniting all Europeans who, from 1999, can and want to adopt the euro. That is why great importance has been attached by my country's government's policy to ensuring that Portugal will enter EMU at the first stage.
A lot of criticism has been levelled at the convergence criteria and the stability pact proposed for the functioning of European Economic and Monetary Union. I think that this criticism is the result of the inflexibility employed by some to read and interpret the Maastricht Treaty rather than the criteria themselves which are sensible, wellthought out and politically correct. From this viewpoint, I must refer to a phrase recently penned by the former German Chancellor, Helmut Schmidt, in a letter to the Governor of the Bundesbank and published in Le Monde. He said that the insistence and tactlessness of his speeches not only make him unpopular, which he accepts, but also make the whole of Germany unpopular, which Germans neither deserve nor are willing to put up with. What I think is that Europe lacks the right social, economic and monetary convergence, analysed with common sense. With or without Maastricht, it is vital to cut deficits, inflation and interest rates. It was not in order to achieve these criteria that the evils we are now complaining about - low growth and high unemployment - came about.
The reports that we are jointly debating are fundamental in terms of introducing the euro, dealt with with openness, political common sense and technical skill, that will make them far more acceptable and comprehensible for the citizens of the European Union that we are creating. Therefore I wish to congratulate the rapporteurs on their work and efforts to reach broad political consensus and I hope they will be adopted by the European Parliament. These reports heap prestige on our parliament and should be vital working material for the Council of Finance Ministers and heads of state and government for the Councils due to take place in Ireland very soon.
Given the fact that, in such a short time, it is impossible to deal with all these matters, I should like to touch upon some vital aspects: participation by national parliaments and their involvement in and co-responsibility for stability programmes, the multilateral supervision to be carried out. It is also vital for us that we add to the proposal to the Commission a new article on the Cohesion Fund clearly stipulating that it will be kept in operation during the third phase of EMU as the differences of development justifying its creation are still relevant, and that the amount of money in the fund and the application conditions be set by a Council regulation.

Wibe
Mr President, much of what is contained in these five reports is good, which is of course the result of the fact that we socialists won the votes in the economic affairs committee. I myself and a number of my colleagues from the Swedish Social Democratic Party will nevertheless abstain on the Metten, Christodoulou and Herman reports. Our stance on this issue is determined by our lack of faith in the economic soundness of the EMU project. This is a view shared by a majority of the Swedish people and, I would venture to say, by a majority of academic economists in the western world.
EMU really does involve a tangible risk that unemployment will rise. There are two reasons for this. The first is that efforts to combat inflation will override all other economic objectives. This will increase unemployment but not because of some kind of Phillips link between inflation and unemployment but simply because zero inflation will force certain businesses to make direct wage cuts in order to bring relative wages into line with supply and demand. The second reason is the lack of flexibility which will arise when exchange rates are fixed. This must be compensated for in some way in the long term, either through wage adjustments or migration of the labour force, which would in practice mean unemployed textile workers from Manchester taking jobs as computer consultants in Milan. I do not believe in this. Socially, EMU is a high-risk project and it is the low paid and those with few qualifications who will face the risks.
Finally, Mr President, I should like to warn against the stability pact. The central idea of this pact is that countries which get into economic problems should be fined. This will exacerbate the problems rather than solving them.

Pérez Royo
Mr President, we are currently debating a number of reports connected with Economic and Monetary Union which reveal the significance this House attaches to this fundamental fact of passage to a single currency. Firstly I would like to congratulate the various rapporteurs and then concentrate on a number of matters arising from the stability pact.
In this connection I consider it necessary firstly to recall a number of ideas on the subject of budgetary stability which are frequently forgotten about despite, or possibly because of, the fact that they are so obvious. The first of these is that the public deficit convergence policy is, per se , a good thing. As the President-in-Office of the ECOFIN Council, Mr Quinn, stated so correctly earlier on, it is an end in itself, with or without Maastricht.
A situation in which, every year, over 5 %, and in some cases even 10 % or more, of the GDP goes to paying off debt interest is an untenable one. Efforts aimed at consolidating the budget are in themselves beneficial and help to ensure lasting growth. The timetable set for Monetary Union has, on the one hand, provided the stimulus for achieving this task and not delaying it and, on the other hand, has meant that such efforts are being coordinated in all the various Member States.
Secondly, and I refer here to the stability pact which is already contained in the Treaty on Union, account has to be taken of the fact that it is less important to achieve on time the target of a government deficit that does not exceed 3 % GDP than it is to demonstrate the political will and capability to maintain such a position of equilibrium - or of not excessive disequilibrium - in a sustained and durable manner. These are the terms in which the Commission is presenting its stability pact recommendation, smoothing off some of the initial German recommendation's rough edges.
The report by Parliament's Economic and Monetary Affairs Committee substantially supports the Commission's recommendation, adding just a few finishing touches which ought to be highlighted and which I will deal with next. Firstly, the Economic and Monetary Affairs Committee points out that greater account should be taken of the economic cycle when deciding whether or not a government deficit is excessive. The second point is linked to stability requirements and government investment given that, in many countries, attempts are being made to achieve the 3 % limit by placing excessively strict controls on government investment, and, clearly, such a practice cannot continue for very long without compromising the future of our economies. We therefore firmly support the final touches certain amendments introduce by differentiating between current spending and investment expenditure when assessing each country's deficit position.
Finally, I would like to refer to the Cohesion Fund which, as you will be aware, is currently available to four Member States. This Fund was set up during the current convergence stage as an instrument to counteract any negative effects the Union's weaker economies might experience, in government investment terms, on account of convergence efforts.
Well, the same philosophy on which the Cohesion Fund based its decision to provide assistance during this stage of convergence still applies to the stability programmes, which will continue to require an enormous effort to square government deficit in the economies of the so-called 'Cohesion States' .
As a representative from one of those States, and on the basis of the notion of solidarity so often invoked in this House, I thought it my duty to emphasize this point which has genuinely been incorporated into the amendments approved in the Economic and Monetary Affairs Committee and which I hope will be approved during tomorrow's sitting.

Ettl
Mr President, the reports we are debating represent an important stage in the deepening of European integration. The introduction of the euro and the associated flanking measures are a logical step in the realization of the internal market, enabling it to generate positive effects such as increasing economic output, employment and social stability and to strengthen the dynamism of the European Union as such. However, this presentation of the potential of the euro should not blind us to other essential aspects of its introduction, and especially to the political and social aspect of some of the technical decisions.
Europe's citizens will assess the euro and the European Union - and us, in this House - in terms of such yardsticks as the level of unemployment and social stability. The euro will lighten the burden on industry in various important ways, be an essential factor behind price stability and the predictability of transactions, and limit the risk of speculation. It will also protect the Union against excessive fluctuations of the dollar parity and stabilize the international monetary structure.
As a result, Europe will become significantly more important as an industrial location. But if the European Union and the European Parliament want to appear credible and not to drive frustrated citizens, living in fear for their jobs, into the arms of glib populists, the beneficial effects of the introduction of the euro must be felt not only by industry but also, and especially, by the workers of social Europe.
We shall see whether the Christian Social and Conservative politicians represent the citizen or whether they are really just paying lip service to social concerns. We shall see, too, whether the Liberals sacrifice their principles to the absolute primacy of monetary stability, without regard to employment and the social repercussions. A purely mathematical interpretation of the convergence criteria, based purely on the value of money, would exacerbate the recession. It would just raise the pressure on workers and on the job market. The much vaunted freedom of establishment would become transmuted into a constant pressure to migrate to the current centres of economic activity.
To ensure a positive dynamic, the maximum possible number of states must be involved from the outset in the third stage of economic and monetary union. Imposing financial penalties is counter-productive, hostile to employment and opposed to economic dynamism. Other cohesion mechanisms - perhaps loss of the right to vote on questions of monetary policy - would be enough.
If it nevertheless happens that resources are returned to the EU budget, these must obligatorily be used for labour market activities. Of course, the conversion to the euro must not be handled by publicly owned banks or other areas of enterprise at the expense of the consumer. Last but not least, I should like to stress the overall social responsibility of the European Central Bank, which goes beyond its obligation merely to safeguard price stability. So greater accountability to the European Parliament is needed.

Torres Couto
Mr President, I too should like to begin by congratulating the draftsmen of the reports on the need to achieve EMU in the conditions provided for in the Maastricht Treaty and in keeping with the set timetables, in order to conduct a policy combining support for the real economy, so as to increase confidence among economic operators, and the kind of investment likeliest to generate large numbers of jobs and high growth.
In preparing the third stage of EMU, some care must be taken, in particular in respect of structural transformations in the financial markets and capital generated by deregulation, information technologies and greater economic interdependence. We must also bear in mind the process of 'disintermediation' , according to which the supply and demand of capital operate reciprocally and without need for financial intermediaries, and the institutional agreement needed to allow for coordination between policies, strengthening the independence of the European Central bank, by means of democratic legitimacy, which I see as a linchpin, and the need to appoint the members of the Economic and Financial Committee in terms of greater responsibility, in keeping as it happens with the proposal made by the rapporteurs.
The single currency is a decisive goal, a vital goal in the process of European construction. But it would be foolish if we were satisfied with reducing Europe to a question of economic and financial construction alone. The people of Europe and its citizens want far more than that. Europe must head towards EMU but it also needs to achieve political depth and never lose sight of ways of strengthening social cohesion. Nobody in Europe today would understand that those who are and were able to define objectives and binding policies in monetary, budgetary and exchange rate terms were able to show such contempt for the people of Europe by not also defining binding objectives in terms of social policy or employment.
The third stage of Economic and Monetary Union is upon us. The single currency will be a reality, one that I eagerly welcome, but I would be very concerned if, when it comes into effect, we did not also have a pact for employment as a factor of hope for everyone in Europe.

de Silguy
Mr President, ladies and gentlemen, let me begin by thanking the European Parliament for its commitment to and support for the introduction of the euro. The deadlines that make up the timetable for economic and monetary union have given you particularly difficult conditions in which to work, and I must take this opportunity to pay formal tribute to all the committees and rapporteurs - Mr Metten, Mr Christodoulou, Mr Herman, Mr Hoppenstedt and Mr Harrison - for their excellent work on the reports we are considering today. I can assure you, Mr Christodoulou, that we shall take due account of it, in what you called the spirit of positive cooperation.
With two weeks to go before the European Council in Dublin, this debate on the present status of economic and monetary union gives us an opportunity to take stock of the advances achieved in the course of this year. I would describe them as substantial and irreversible.
Think back. In December 1995, thanks to your support, the pattern for the introduction of the single European currency and its name, together with the work programme for the year 1996, were ratified by the European Council in Madrid.
In accordance with that programme, our task today is to validate all the preparatory work for the introduction of the euro, but this is also an opportunity to determine what progress has been made towards convergence. Unfortunately, and to my regret, I have no time to consider the five reports and all your suggestions in detail. With your permission I should like to simplify matters by basing my replies on two main sets of comments, dealing with the progress of convergence and the preparations for the introduction of the euro, which will be completed on time.
Before I say anything about the Commission's autumn forecasts for 1997, I should like to dwell for a moment on this year's progress towards convergence.
The Commission's reports, and that of the EMI, bear witness to the fact that the various elements of lasting convergence in Europe are becoming stronger and stronger. While the Commission's report focuses mainly on the advances achieved in terms of the four - or five - convergence criteria, it also considers, as Mr Metten hoped, the compatibility between national legislation dealing with the national central banks and the stipulations of the Treaty designed to ensure the independence of the European system of central banks. The report shows that there are a number of cases in which national legislation will need to be adapted.
Substantial progress, moreover, has been achieved in every Member State with regard to every aspect of convergence. As far as inflation and interest rates are concerned, the results are impressive. In answer to Mr Pomés Ruiz, I should point out that as far as the inflation criterion is concerned, the Treaty allows the Commission a choice. We opted for a simple, unweighted average as being the clearest method, though I should add that even if we had used a weighted average the results would be the same. So the results as regards inflation and as regards interest rates are excellent.
As far as foreign exchange stability is concerned, there have since Sunday been twelve Member States participating in the EMS exchange mechanism. The Commission welcomes the return of the lira to the EMS. This is another encouraging signpost along the road to the achievement of the euro, and I should add that the EMS is functioning well, since the gap between the strongest and the weakest currencies in the EMS fluctuation band has narrowed by virtually half since a year ago.
As far as public finances are concerned, convergence has still not gone far enough, even though it is progressing. The Commission agrees with the EMI that only four states - Denmark, Ireland, Luxembourg and the Netherlands - will have kept their 1996 government deficits below 3 %. Only three - France, Luxembourg and the Netherlands - will have indebtedness of below 60 %.
Thus, and I must stress this point, the European Council in Dublin will find that a sufficiently high degree of convergence has not been achieved by a majority of States. The procedure laid down in Article 109j(2) will therefore have to be repeated as early as possible in 1998. The European Council will then be in a position to take its decision as a function of the high degree of sustainable convergence that has been achieved.
However, the Commission's forecasts of November 1996 highlight a revival of growth and an improvement - admittedly hesitant, as yet - in the employment situation. The growth forecasts are 1.6 % in 1996, 2.3 % in 1997 and 2.8 % in 1998.
A study of the components of demand shows that growth in 1997 and 1998 should be balanced. Exports will play a dynamic part and manufacturing investment, which is expected to grow by 5 % in 1997 and by nearly 7 % in 1998, should once again become the driving force behind growth.
The changing employment situation between 1996 and 1998 will see the net creation of 2.3 million jobs over three years. Let me add that, in the medium term, only relatively strong, sustainable growth will enable unemployment to be reduced significantly. That, incidentally, let me say in answer to several speakers, is why we are introducing the euro. The euro is conceivable only in the context of a dynamic which creates a framework of stable, sustained growth which will create jobs.
The Commission's forecasts give some indication of the future prospects. They are encouraging, showing that a significant number of States are on the right track to be able to join economic and monetary union from the outset; but I should make it clear that the forecasts are still no more than an initial preselection from the list of States that will adopt the euro on 1 January 1999.
I must stress the fact that compliance with the convergence criteria, allowing access to the euro, will be verified as early as possible in 1998 on the basis of the final 1997 figures, and also in the light of the past and future performance of the Member States with regard to the various aspects of convergence.
Let me remind you that, according to the Treaty, the States participating in the euro will have to have achieved a high level of sustainable convergence. I am grateful to Parliament for this debate, which enables us - for the first time, I believe - to clarify those words a little. For the purposes of assessing the degree of convergence, the Treaty provides five criteria. Compliance with a particular reference value is not in itself a sufficient condition for selection. To ensure the sustainability of convergence, it is no use considering one year's performance in isolation. That means that one-off measures will have to be backed up by credible commitments to maintaining budgetary stability in subsequent years. There will be no sleight of hand. And that is my answer to Mrs Hautala. The classification, for one year, is a purely technical accounting operation. It is not a preselection for transition to the euro. The sustainability of budgetary stability is, indeed, the objective of the stability pact, which, together with the legal status of the euro and the new EMS, make up the three major preparatory tasks necessary for the introduction of the euro.
If I may, let me say a word about the stability pact. To Mr Willockx my answer is: no, don't worry, the stability pact will not be deflationary in nature. There is increasing support, in Europe and elsewhere, for the view that sustained growth is possible only with healthy public finances, allowing interest rates to be reduced permanently. Budgetary policy might, and should, play a part in stabilizing the economy, and in order for that to be possible budgets will have to be balanced, or show a credit surplus. That is the very logic on which the stability pact is based. So I can assure you, Mr Christodoulou, that the stability pact does not mean a German-dominated Europe, or capitulation, or shackles, or excessive rigidity. It is the economic framework essential for the creation of jobs in tomorrow's Europe. Don't worry, Mr Cox, the Commission will stick to its guns on this point.
First, and to answer Mr Caudron's point, the stability pact provides a consistent, credible, balanced and pragmatic framework. In accordance with the Treaty - and there can be no doubt about this, because the text is indeed an integral part of the framework of the Treaty - the Member States shall aim to balance their public finances in the medium term in order to encourage growth and employment. And, if it is to bring about all these beneficial results, it is essential that this objective should be respected in the long term.
Next, the stability pact is first and foremost preventive. Its aim is prevention rather than cure. That is the entire purpose of the rules adopted on the basis of Article 103(5) of the Treaty. It is thanks to the stability programmes, which will be presented by the Member States and approved by the Council, that we shall be able to achieve it. And I can assure you that the European Parliament will be kept informed about them, because they will be made public. These programmes will be based on macroeconomic assumptions, including employment, and that is my answer to the various concerns that have been expressed. The Council will at all times be able to make the appropriate recommendations to ensure that budgetary implementation complies with the objectives. And, to that end, we shall be instituting an early warning system to detect any discrepancies.
Finally, the stability pact must also have a deterrent effect. For the benefit of any doubters, let me remind you that a budgetary deficit puts a country - France, let us say - in the situation of a household which is earning 13, 000 francs a month and spending 15, 500 - spending, in other words, 20 % more than it brings in. The Member States must realize that this kind of overspending has to be penalized, and the Treaty has made provision for that, in Article 104c, with the excessive deficit procedure. I can reassure Mr Watson that no such procedure is possible on the basis of Article 103.
Article 104c was the basis on which the second proposal for a Regulation designed to make this procedure operational was presented to you. On sight of the results of budgetary implementation, the Council will decide whether or not an excessive deficit exists, taking various factors into consideration. Was the situation normal or exceptional in the year in question? Should the deficit be considered excessive in the light of all the parameters of the Treaty, and with particular regard to the proportion accounted for by investment expenditure? If there is an excessive deficit, everything possible must be done to correct it quickly, in order to safeguard growth and investment. Also, the Member State will be allowed several months - from March to December - to adopt the necessary measures and have them approved by the Council. I can assure you, Mr Watson, that the Commission will leave the choice of measures to the Member State - whether to reduce spending or to increase income is a matter for subsidiarity. I would say that the Regulation allows sufficient flexibility to make allowance for the variety of national parliamentary procedures and hence for the concern of the national parliaments, Mr Christodoulou.
If the Member State in question takes no corrective action, it must be prepared for the Council to apply the provisions of the Treaty, in other words to activate a sanctions mechanism. I will not describe that mechanism because we have discussed it at length. I would describe it as balanced and sufficiently flexible. It is an adequate deterrent, without being so severe as to become counter-productive.
Mr Christodoulou's report and the compromise amendments that accompany it are, as a whole, consistent with the logic of the stability pact presented by the Commission. This is a very valuable contribution to the current discussions in preparation for the European Council in Dublin.
As is apparent from Article 5 of its proposal for a Regulation on the basis of Article 103(5), the Commission shares your concerns. It would like you to be able to study the results of the monitoring procedure. It is also fully aware of the need to draw up rapidly, as you suggest, its proposal aimed at improving multilateral monitoring for the pre-in States. But I must add that it considers it inappropriate to extend the scope of application of this proposal by integrating into it policies or instruments other than those which are the object of the stability pact.
In continuing its work, the Commission wishes to take the maximum possible advantage of Parliament's contribution. Thus, in the case of the Regulation based on Article 103(5), the Commission can accept Amendment No 21, together with Amendments Nos 1 and 18, and compromise Amendment No 2, subject to certain editorial corrections. In the case of the other Regulation, based on Article 104c(14), the Commission can accept Amendments Nos 9 and 13, together with Amendments Nos 1 and 2, subject to certain editorial corrections.
The second preparatory task, about which much has been said, concerns the legal status of the euro. The Commission, like this House - and I should thank the rapporteur for his quick work - has put in a great deal of work on this, in a very short time, I may add. The draft before you is the draft of the new monetary law for Europe - the monetary law of the year 2000. This text, the adoption of which is expected at an early date, is being insistently and urgently demanded by all the future users of the euro who need legal security.
Let me reassure Mr Herman: there has been no capitulation. I can reassure Mr Cot, too, or at least I hope so: the Commission has surrounded itself by specialist legal opinion and has taken every precaution. That is no complete guarantee against disputes, but Mr Cot knows as well as I do that lawyers make a living out of our texts, so we can hardly prohibit them. Because I had also received an amendment, which did not originate with the European Parliament and which I rejected - which was to prohibit the right of appeal. I thought that might be going a little too far down the antidemocratic road. That is why we gave priority to legal security although of course we were fully aware that it will not rule out appeals. That is the normal way in a democracy.
Since much has been said about the name of the currency, I should make it clear that the name euro is a specific version of the generic term ECU. The fact of clarifying what, in many languages, was no more than an acronym, an abbreviation, is not an amendment to the Treaty, and our legal experts are unanimous on that point. As regards the Community currency, Mr Herman, my answer to you is that the approach selected is the approach of national sovereignty. The Regulation gives a new currency to the sovereign States participating in the euro zone. To say that the euro is the currency of the Community would not be - regrettably, perhaps - but it would not be an accurate reflection of the situation for such time as some Member States choose not to adopt the euro and have the legal option of doing so.
I shall not go into details of the two draft Regulations. I don't want to dwell on this, because I think we are quite clear about their content, both as regards the fact that the Union will have only a single currency from 1 January 1999 and as regards the fact that these texts are designed to ensure the continuity of contracts and obligations.
The natural legal basis for this kind of monetary constitution is Article 109l(4). However, this article applies only from the beginning of the third stage. That is why, at the express request of future users of the euro and in agreement with the Member States, the Commission has proposed that a number of provisions should be made applicable with immediate effect, on the basis of Article 235.
Thanks to these two Regulations, no court in the world - in New York, even in Singapore - will be unaware of these rules, which establish the transparency and legal security of the introduction of the euro. This requirement is essential. It is the very principle of the 'lex monetae ' .
Don't worry, Mr Areitio Toledo, this is not an end but a beginning. It will need to be supported by efforts at communication, and thanks to your support we have made a start on those efforts, but we are of course going to develop them and, I would say, go further. The requirement of legal security must also benefit all Europe's citizens. Mrs Randzio-Plath is right, and I share her concern. The citizen is a taxpayer, a wage-earner, a consumer. So this security must benefit him, whether it relates to his contracts, his savings, his earnings or his purchasing power.
The Commission has also decided to organize, before next summer, a round table specifically devoted to the practical aspects of the transition to the euro, especially those of interest to trade and the consumer, and of course this House will be involved in that. I think I can reassure Mr Garosci on that point, and Mr Whitehead too: all the departments concerned were involved in our proposal for a Regulation, and they will be involved in the forthcoming ones as well.
Only when we see the results of a very detailed consultation with all those involved will we be able to tackle the main problems: dual pricing, bank charges, the cost/benefit analysis of the transition to the euro, the conversion of prices to euros and the penalties for fraud, breaches of regulations and counterfeiting.
Following this exhaustive study, we shall then be in a position to assess whether it is necessary to add to existing Community legislation. Mr Cot asked me for a commitment regarding the methods used and the timetable. I hope I have replied to that. I share your concern. We need to reassure public opinion about the conditions under which the euro will be introduced, and take due account of consumer concerns. That will be the priority for the Commission's activities during the coming year.
All these concerns are fundamental, but the only way of responding to them was through this 'lex monetae ' , which is the monetary constitution of Europe, and whose sole purpose is to give maximum legal force to the basic principles: definition of the currency and security of obligations.
The Commission, then, is in no position to broaden the scope of application of its proposal. However, it can accept all those amendments which strengthen the effect of the 'lex monetae ' . I am thinking here of Amendment No 3, together with slightly changed versions of Amendments Nos 1 and 2 and the amendments to the Regulation based on Article 235. As regards the Regulation based on Article 109l(4), the Commission can accept Amendment No 4 together with Amendments Nos 2, 16 and 18, subject to certain editorial corrections.
Mr President, ladies and gentlemen, thanks to your support the timetable laid down by the European Council in Madrid can be met. Mr Hoppenstedt said just now that Dublin would be the acid test. I personally hope it will be a success and that we will be able to reach agreement on the substance. Our remaining task then, on the legal front, will be to adopt the necessary formal provisions. And then we shall have numerous other tasks to accomplish next year. Mr De Clercq, you and various others refer to the external aspects of the euro. I think the time has indeed come to give thought to that. If you would like to invite me to address your committees on the subject, I shall have the greatest pleasure in accepting.
In conclusion, Mr President, ladies and gentlemen, I believe that we have shown in the last two years that our method of close collaboration between Commission and Parliament has borne fruit. The institutions - and I will include the Council and the European Monetary Institute - have once again shown their ability to work together in the interests of all European citizens.
There is no denying that much work has been done in the last two years. It remains for us to take full advantage of the year 1997 to bring this new vessel safely into harbour.

Metten
Mr President, to a large extent I am satisfied with what Commissioner de Silguy said but there is one thing that worries me. It might be a good idea if he were to listen to me. He would appear to be introducing a new convergence criterion, namely sustainable convergence. In other words, he more or less said: meeting the criteria in 1997 is not sufficient. We must also look at past and future performance. I am also worried because I have also been hearing this view from a number of central bankers this last week. Just after the Commission presented its autumn forecasts which indicate that countries such as Spain and Portugal might well fulfil the criteria. Can the Commissioner reassure me?

Herman
Mr President, I too would like to thank the Commissioner for the explanations he has given us. They are not convincing in every case, but I don't want to reopen the debate here - I shall do so at a personal level, if you are interested. I know that you yourself are in no position to decide what is best, because you are constrained by the Member States.
Having said that, I would like to make two comments about the amendments you have received. There are two errors. In Amendment No 30, the euro is not the currency of the Union but the currency of the Community. I know that will not change your point of view, but it is important to this House, because the Community has a legal personality and the Union has not.
Amendment No 17 also contains an error. It should be clearly stated what the securities issued by governments are. So in this case I do not know why you refused it. On the other hand, I am very surprised at your failure to accept the amendment which states that the euro is the accounting unit of the Community institutions - as if you could draw up your budget in anything other than euros. In this case I don't understand why you are refusing to accept something which you cannot in any case refuse.

Christodoulou
Mr President, I wish to thank the Commissioner for his analysis.
However, I would also like to say a few things in connection with the amendments that he has not accepted. I cannot understand why, for example, he has not accepted Amendment No 59 to the first regulation. And I cannot understand why he has not accepted Amendment No 17, again to the first regulation, which simply refers to Council decisions or to Council regulations, and Amendment No 20 - I mention these particular amendments just by way of example - to the first regulation, which would, I feel, make his job very much easier if he himself were to be charged with implementing that regulation, as I hope will be the case, if he himself agrees, of course.
I request the Commissioner to look again at these amendments, not just at the ones that I mentioned but at all of them. I feel that many of them would very greatly facilitate the implementation and the functioning of these two regulations which all of us here regard as essential.

de Silguy
I shall answer briefly, Mr President, because I don't want to take up your time. First, let me reassure Mr Metten that we are not creating a new criterion. There are five criteria in the Treaty, bearing in mind that the public finance criterion is a double one. Just to quote from Article 109j(1): ' The reports of the Commission and the EMI shall also examine the achievement of a high degree of sustainable convergence.' So this is just an application. Obviously, it is difficult to find oneself in a situation where an excessive deficit could be rescinded. You cannot rescind an excessive deficit, if the 1997 deficit is less than 3 % and if you know that the predicted deficit for 1998 is greater than 3 %. So I don't think there can be any misunderstanding. In any case, there is nothing new here as compared with what the Commission has always said.
Mr Herman, there is no problem here. You ask us, as far as the European institutions and the budgets are concerned, to have the euro established as the accounting unit. I would say that is automatic, provision has already been made. You would weaken our position on ECU/euro continuity if you were to ask us to insert such wording into a Regulation.
Finally, one more point on the amendments. We are not going to reopen the debate now. I can assure Mr Christodoulou, and the other rapporteurs too, Mr President, that following tomorrow's vote on the various reports we shall proceed with a careful examination of all the amendments and - in the positive spirit of cooperation I have already mentioned - we shall see what we can do, but if anything can be done you can rely on my support.
(The sitting was suspended at 8.15 p.m. and resumed at 9 p.m.)

Science and technology in the 21st century
President
The next item is the report (A4-0376/96) by Mr Desama, on behalf of the Committee on Research, Technological Development and Energy, on prospects for European science and technology policy in the 21st century.
I now call upon Mr Desama to introduce his report. You have all the time in the world, Mr Desama, provided you restrict yourself to nine minutes.

Desama
Have no fear, Mr President, I shall not overstep this generous time limit. It may always be useful later! You never know.
Commissioner, Mr President, ladies and gentlemen, this report might well have deserved better than this evening meeting at which, of course, there are not many honourable Members here to listen to us. It's remarkable, really: we've just finished a very long debate on the euro, a subject which I doubt will be mentioned by anyone in 2002 or 2003, yet we are now going to talk about a research and development programme which will certainly shape the future of the European Union for a much longer period.
Anyway, what is the purpose of this own-initiative report? Well, basically, the European Parliament would like to play a major part in the preparation of the Fifth Framework Programme which will begin when the present framework programme ends, in other words at the beginning of 1999. We have in fact learned the lessons of the Fourth Programme, and we have realized that, ultimately, if Parliament's intervention followed the traditional parliamentary procedure, in other words if it took place at first reading, we had insufficient time to give detailed consideration to the broad outlines of the programme. We also wanted to tell the Commission about a number of convictions and viewpoints we had regarding the future of research and development, and thus the future of our European Union. Taking specific advantage, I may say, of the approach adopted by the Commission itself, which, very early this year, launched a strategy document to provide food for thought for the various Member States, well, Parliament decided to join in and produce its own strategic discussion paper. That is the purpose of this owninitiative report.
What are the major points made in this report? First, that in this day and age the traditional model according to which research and development was organized, what was known as the linear model, with a sequence of basic research followed by applied research followed by innovation, was an obsolescent model and that today we operate it in the context of the systemic or relational model in which, ultimately, basic and applied research were intimately linked. This model also features more and more transdisciplinary research. This development was initiated by the Fourth Framework Programme. We should like the Fifth to build on that, being organized around what today, clearly, is the new research and development concept.
With this in mind, we have proposed in this report - which I hope, indeed I feel sure, will be adopted tomorrow by a large majority - an approach which I would call the matrix approach. This comprises blending a number of research sectors covering not only enabling technologies but also scientific research into sectors of future significance such as information technologies and those linked to genetic science. In other words, a wide variety of fields where basic and applied research could be effectively blended, with the possibility to move first in one direction, then in another, depending on the opportunities and openings each approach offered. However, alongside this major fundamental research effort, there would also be a number of targeted schemes.
This idea, of course, is directly inspired by the initiative adopted by Commissioner Cresson in connection with the refinancing of the Fourth Framework Programme, with the concept of task forces, which certainly did not enjoy unanimous support within this House but was nevertheless a very much more proactive, targeted and organized approach, centring on research projects which were regarded as likely to provide impetus. Well, our proposals have adopted that idea, and we also hope that these major targeted programmes will raise the profile of research and development as far as public opinion is concerned, and so result in greater public support for research and development efforts at Union level.
So: new organization, new structures and new contents too. The fact is that hitherto, it must be said, the first four framework programmes have been essentially - I shall not say exclusively, but essentially - devoted to the permanent endeavour to make our industry more competitive. That is unquestionably a fundamental objective. It is fundamental because it is enshrined in the Treaty and because we cannot regard the Treaty as just a scrap of paper, but also because it reflects Europe's powerful ambition to have a strong presence in the major international markets.
Today, though, we believe that, as the European social model changes, it is becoming more and more important for European research and development also to meet a powerful social demand - a demand from society which surely expects us to create a sound industrial structure with industries that function, but also hopes that research will provide answers to the insistent problems that our citizens have to face, problems which do indeed call for additional efforts. Well, the main message of this report is that today, although we must undoubtedly continue our efforts to improve our industrial potential, we have also got to meet that social demand.
At the same time, too, we are proposing a great many measures - I will not list them all here - to be taken to facilitate the passage from research to innovation. These problems had already been touched upon in the Commission's Green Paper, which was supported by Parliament. Here again we have adopted a number of strong proposals. We would also like to see the establishment at long last of a large-scale European scientific community, and, in that effort to create that scientific community, we would like to use not only the instruments of the research programme but also the Common Research Centre, which is one of the pillars of European integration although its functions, over the years, have no longer been as clearly apparent as they were at the outset. It had, as they say, taken a beating; it is making great efforts at restructuring, and we must pay tribute to that, but it should now be having fresh ambitions, and we have proposed some for it.
Finally, there are financial instruments, since anyone can see that the simple mechanism of the research framework programme is not enough to launch a whole dynamic range of new financing, especially as regards the SMEs. In that context, we would like to see more inventive formulas for mobilizing risk capital in favour of research and development than for association with private capital. We have made proposals for new financial instruments, and I feel sure that the Commission will pay very careful attention to these.
Naturally, we support and have once again put forward the idea of improving the management of the programmes and making them more effective. A great deal of work has already been done here under Mrs Cresson's predecessor, Mr Ruberti, and Mrs Cresson has followed up and broadened the efforts he made. But there is still much to be done before we can start to escape from the red tape that sometimes strangles innovation and initiative.
Finally, Commissioner, and my concluding remarks are addressed particularly to you, obviously we would not want this own-initiative report to be just one more document on your table. We should like the Commission's preparation of the Fifth Framework Programme to be the opportunity for instituting a major dialogue between Parliament and the Commission, involving the Member States too, if they wish, in the form of what we have referred to as an institutional conference, although we don't feel strongly about names. As Alfred de Vigny said, ' What does the bottle matter, provided the contents are intoxicating?'

Linkohr
Mr President, I should like to start by thanking Mr Desama most sincerely for his report. This report is by way of preparation for the debate on the Fifth Research Framework Programme and, in the weeks and months ahead, once we have adopted it, it will undoubtedly result in the further enrichment and broadening of the debate, especially once the Commission has submitted its proposals. It is important to point out that the issue here is not spending money but creating or sustaining a culture - a scientific culture - which has played its part in shaping this Europe of ours over the last three or four hundred years. I can't help fearing - and I think I am not alone here - that this scientific culture is gradually giving way, that scientific values are giving way, to a different culture in which the only concern is with the short-term money-oriented evaluation of products and processes. I feel sure it is worth emphasizing something that all of us know, here in this House, that Europe has eased up in its scientific and technological endeavours.
Yesterday, the British Chancellor presented his budget. If you look at the science budget, you will see a reduction in real terms. I could say the same of the science budgets of other Member States - those of France, Germany, Italy and plenty of others. We had great difficulty in topping up the Fourth Research Framework Programme - we are still having difficulties, we have still not solved the problem. It is much easier to spend money on areas other than science, education and technology. What that means is that we have no money for the future. We are consuming it today, or being forced to pay off debts we incurred in the past. This lack of vitality may be the main reason for the problems facing Europe today. That statement has very often been heard in this House, and it is true all the same. We must work to sustain, and enhance, a scientific culture in Europe. This applies, too, to the subject we are discussing today - scientific and technological policy in the 21st century. What is the main change going to be between that century and this? That it will not be the century of Europe: the majority of mankind lives outside Europe. By the middle of the next century, two-thirds of humanity will be living in two countries which are not part of Europe. Those countries are not going to sit back - they are going to develop their own science and technology, perhaps more successfully than we do. And Pakistan is unlikely to be confined to a single Nobel laureate, as it has been in the 20th century.
So what is Europe doing? What are we investing in? What can a young person today identify as an investment in the future? Fine new buildings for banks or insurance companies? Marble will be too cheap for them. But what is being invested in science and technology? We are wrangling over peanuts, when we should really be committing ourselves to major expenditures! Europe must ask itself whether it wants to invest in the future - whether it wants to prepare for the 21st century. If it does, then the Fifth Research Framework Programme - to be more specific - must also have a global aspect. I can still remember the debate we had in connection with the Fourth Framework Programme. Unfortunately, we were unsuccessful in our attempt to gain an appropriate level of recognition for global aspects in the Fourth Framework Programme. I hope that the Fifth Framework Programme will provide us with increased opportunities to see Europe in the context of other cultures, too, to understand other cultures and, once again, to be more receptive to other cultures. This aspect of globalization must play a major part in science.
Finally, I believe it is a good idea for the Fifth Research Framework Programme to be geared towards visible objectives as well. The Commission has given some thought to that. There are other proposals, too. Parliament has put forward some ideas of its own. My hope is that we can give science a higher profile, and perhaps increase the number of people who take an enthusiastic interest in it.

Quisthoudt-Rowohl
Mr President, ladies and gentlemen, once again we are embarking upon preliminary discussions for a framework programme, and that framework programme, like all its predecessors, will be a four-year one. In other words, it has to be both consistent and flexible, even if that seems to be a contradiction in terms. I should like to look at three separate points, three specific proposals made by the Desama report, which seem to us to be particularly important.
First, the various policies in the area of research and development must be integrated and coordinated as a matter of urgency. We need more research and development input into our structural, agricultural and environmental policies, and it must be possible to coordinate that input with the specific sector of research policy. That is the only way we shall be able to spend the money efficiently, and the only way of making it clear to the citizen that progress is needed everywhere, not just hidden away in one particular programme.
Secondly, research and development are all very well, but we must improve the involvement of the SMEs, not everywhere, not in every instance, but wherever it can be done. So we must also set measures in train to create easier access to risk capital and new, hybrid forms of financing. The Union level could provide a valuable stimulus here.
Thirdly, we consider it very important for researchers to be more involved than they had been in the evaluation and further development of research policy. We must institutionalize the dialogue between researchers and policy makers, and we must also convince our researchers that they have a duty to be politically active, and a duty, too, to inform the citizen, to explain what the issues are. Bearing in mind the great scarcity of resources, we do need to create much greater public acceptance of what we are doing. We are not living in a period of exuberant budgetary growth, and so we need to state what we want. And that implies, too, making it quite clear what we don't want. That second point will be the most difficult: it will be difficult to say, no, not that, this instead! I hope, Commissioner, that you will participate in a constant dialogue with us to help us define what we do want, and that you will listen to the voice of Parliament from the outset.
Finally, it seems very important to us that we should encourage value added creation in Europe. That will be all we can afford - not, sadly, everything we should like to afford!

Scapagnini
Mr President, Commissioner, what are we doing right in the field of research, and what errors are we making? Should the great changes that have taken place in scientific knowledge and industrial production during recent years - changes largely associated with the widespread availability of information and advanced communications technologies - prompt us to review and rethink our present structures and policies for research and technological development? What can we do about the challenge of social problems, 18 million people unemployed, economic growth, health, the environment? We are seeing the consolidation of the model of an information society in which economic, industrial and social aspects interact and combine more and more.
In point of fact, Commissioner, what are the real weak points in this European system of ours? First and foremost, there is the one to which you referred: the problem of the so-called European paradox. This refers to the fact that, although Europe has a highly advanced level of basic research, that fundamental research is not being competitively translated into patentable technologies. We need only recall that the European Union and its Member States spend about five times as much as Japan on basic research, but the Japanese actually hold many more patents than we do. The problem I have just outlined is closely connected with the problem of frequently inadequate financing systems, given the insufficient level of risk capital available for technological innovation.
So what can we do? From what has been said, it seems obvious that the first requirement is to adapt the technological research and development model to the social and cultural system. The issue now is not just to come up with technologically advanced solutions but also to ensure that technology is directed towards meeting the needs of the public. In the course of the 21st century, European industry will find itself having to confront a competitiveness based on new priorities: education, the quality of life, sustainable development. We need to take action now to create the conditions in which a new research and development model can meet those needs. We have to increase the amount of investment capital and create new forms of financing through better mobilization of private and public capital and the cutting out of red tape. We need to bring about the conditions for the mobility of researchers, encouraging exchanges as an important vehicle for the spread of knowledge. With this in mind, we need to try to find new organizational forms for Community cooperation projects to prevent their becoming literally a closed circle, thus encouraging the creation of new forms of collaboration and endeavouring to rethink those which already exist.
We must allow much greater flexibility and the possibility of action to correct the programmes in real time, as they progress, and prevent resources from being irrevocably assigned to technological initiatives which may subsequently prove to be dead ends.
We cannot confine ourselves to proposing new, specific research programmes - we must establish a new approach, concentrating on priority themes, which means, to some extent, a fundamental change in the conception of community research. The starting point is the identification of a specific problem instead of an entire sector of important research. With this in mind - and we are addressing the Commissioner here - our research committee has declared its support in principle for this new task-force approach which may thus improve Community research results. Finally, faced with the challenge of the globalization of knowledge, we certainly need to promote new forms of cooperation with the United States, Japan and other technologically advanced nations.

Plooij-Van Gorsel
Mr President, Commissioner Cresson, ladies and gentlemen. I should like on behalf of the Liberal Group to offer Mr Desama our congratulations on his report. Despite the many amendments it has emerged as a report which is easy to read and points the way clearly to the fifth framework programme. The fifth framework programme should focus on the competitive strength of European industry, and especially of the small and medium-sized firms.
SMUs still provide the biggest number of jobs and therefore deserve an important place in our European research and technology policy. But such a policy can only be effective if at the same time investments are made in cars at the national and regional level. Innovation policy for SMUs is a prime example of responsibility by national and regional authorities for they are in the best position to know the requirements of small and medium-sized companies.
There is no such thing as the small and medium-sized firm in Europe. SMUs are not a homogenous group of companies but is a composition of firms which are very diverse in their sector and their size. We must distinguish our approach according to target group if we want to have maximum benefit of SMUs participating in European cooperation projects. That is why I am pleased my amendment on the subject was accepted.
But on the eve of the 21st century it is wise to pause for a moment and reflect. Europe produces a great deal of new knowledge, but production of knowledge is not enough. Not enough original work is being done with that knowledge and what is being done is not producing enough. Take for example Philips CDI and HDTV. We should be investing more in product renewal and lay less store by cost effectiveness. That is why firms must learn to work better together. Knowledge and experience with successful policy must be better distributed and workers must be better trained in practical and social skills. The more technical society becomes the more it becomes dependent on human creativity and the capacity to learn. I shall therefore go into this in greater detail in my report 'Development and applications, information technology in the next decade' .

Holm
Mr President, I should like to thank Mr Desama for having so energetically taken on such a difficult task as on the one hand evaluating the fourth framework programme and on the other attempting to analyse the fifth framework programme. It is a very important piece of work.
I have already secured many of the important amendments at committee stage but in view of the fact that the vote in committee was complicated I have been compelled to table a number of amendments here in Parliament too and it is these amendments that I am going to talk about.
The first amendment concerns the importance of noting that the fourth framework programme committed a great deal of funding to large enterprises and large institutions, whereas we in Parliament have stated many times that it is small businesses that are important and that we should support. This is why I want to include some reference to the importance of small enterprises and research going hand in hand.
In the second amendment, No 4, I refer to the fact that it is not only the social requirements which are important but also those of the environment. We know that the people of the EU believe the environment to be important and that more research is needed in this field. That is why it is important that we also mention in our conclusions the social and environmental needs for research.
Amendments Nos 5 and 6 relate to another important aspect, namely the research carried out by the EU and how it can affect or be used in such areas as the military, which infringes the spirit of the rules we have made. For example, I have here the evaluation of the fusion programme for 1996 which we requested in Parliament in the spring. It states unequivocally that it is fusion programmes which are important and that there are no problems at all. This is of course not so at all. Programmes of this nature that include fusion research can be used for the military development of arms and other matériel equipment for example. It is therefore important that we do not have these resources and that research funding should have to be repaid if it goes to this type of research.

Vaz da Silva
Mr President, Madam Commissioner, I support a strong and ambitious R&D policy, striking a balance between horizontal activities involving science and technology and vertical schemes focused on users' needs. I support a priority consisting in placing 'viability' and popular motivation at the centre of an information technologies policy for Europe.
The proposed EU cell recently set as an objective for the year 2000 that of restoring cohesion in European societies. How can that cohesion be brought about? First of all, by creating an initiative bringing together education, training and research. Only if people are scientifically literate from earliest schooling can people be encouraged to take an interest. Secondly, by avoiding any excessive concentration of objectives, as I have seen in the fifth framework programme. In order to avoid negative consequences, we must take a transnational approach to the areas included in the fourth programme, such as information and communication technologies, marine science and technology, and renewable or less-polluting energy resources. Thirdly, by guaranteeing that small firms take part through support for innovation in terms of products, processes and services offered. Incentives should not be processed in a single framework, created for them alone, so as not to scare small firms away from strategic areas of research for European industry. Fourthly, by promoting sustained and broad cooperation with third countries, based on the principle of mutual benefit. In Africa and Latin America we should go beyond the sectors we have limited ourselves to, health and agriculture, for which first action programmes should be applied. The development of those countries relies on the internationalisation of their research centres and technology transfers. Fifthly, by making mobility more widespread and irreversible. We must give thought to a European doctorate, the status of European scholar, scholarships encouraging people to return to their country of origin and the installation of advanced researchers in less-advanced countries.
Finally I should like to appeal for cooperation to be stepped up between the Union and its Member States, between the Member States and with third countries. Community programmes and instruments must be coordinated. That is the only way of fleshing out an autonomous European policy for the 21st century.

Malerba
Mr President, Commissioner, ladies and gentlemen, I believe that the discussions to date within the Research Committee have been very valuable in prompting thoughts about the Fifth Research Framework Programme and resulting in an initial outline plan which takes account of certain fundamental criteria: meeting new needs of society, making research efficient at translating scientific excellence into useful and economically valid applications, and improving the coordination between European and national levels to combat duplication and fragmentation.
Mr Desama's excellent report considers the need both for continuity - the horizontal schemes - and the need for change - the objectives of an evolving society - and begins to suggest criteria for deciding what our objectives are and who is to be called upon to achieve them. The rapporteur proposes knowledge-sharing technologies and targeted projects organized in matrix form. I believe that this structure, inheriting the task-force concept, is a valid one, but what will determine the success of this approach will be the political debate on the subjects and criteria of the choices, the debate we are having now.
To help us see the importance of these criteria, I should like to point out that the European Union has an annual maximum of about 3, 000 million ECU available, whereas the aggregate expenditure on research in Europe, within the Member States, amounts to about ECU 120, 000 million: 50, 000 in the public sector and 70, 000 by industry. Thus the European budget, provided it is invested in long-term programmes, becomes numerically significant and can therefore acquire a high profile and strategic significance.
As further support for such an approach, it should be recalled that a long-range programme of technological challenge carries both industry and academic research along with it and is not liable to confusion with an industrial research application programme which may arouse distrust in academic circles.
As for organization and European coordination, I believe the multi-track participation scheme on the lines of the ESA (European Space Agency) or EUREKA, may be a suitable model. To facilitate the transition from scientific excellence to practical excellence, I believe provision should be made for high-powered schemes to involve the end users, eliminate technical obstacles and create new instruments to provide finance and link research and innovation, such as venture capital.

Cresson
Mr President, ladies and gentlemen, first and foremost I must congratulate Mr Desama on his excellent own-initiative report, which puts forward many new ideas and, especially, shows a remarkable understanding of the current modern development of research on the brink of the 21st century. I should also like to offer my warmest thanks to all the members of the Committee on Research, Technological Development and Energy who have participated in this work.
This is the first time in the history of the framework programme that the European Parliament has taken the initiative and expressed an opinion before any formal proposal has been presented by the Commission. The advantage of this formula, of course, is that it enables Parliament to put forward its views at a stage of the proceedings when they can be extensively taken into consideration by the Commission. In the same spirit, incidentally, the Commission waited until the conclusions of Parliament's efforts were already well known before presenting a first working document on the Fifth Framework Programme, which it did last week. This document, which specifies and clarifies the broad outlines given in the communication 'Invention Tomorrow' , is intended to provide added depth to the debate carried on within the institutions. And I await Parliament's reactions to this with the greatest interest.
My comments on your report will, with your approval, focus on three points. First, I shall emphasize the areas of agreement between the views expressed in the report and the Commission's proposals. Then I shall give you the Commission's view of certain points in the motion for a resolution that are not to be found in its own documents. And, finally, I shall place the report in the context of the procedure for preparing the Fifth Framework Programme by outlining the form which that preparation is to take.
First, the areas of agreement. The extent to which the own-initiative report and the motion for a resolution agree with the views put forward by the Commission is apparent both in the general approach and in a number of specific points. Thus, the idea of a framework programme resolutely geared to economic and social needs is at the heart of Parliament's motion for a resolution as it is at the heart of the Commission's communication 'Invention Tomorrow' , which sets out the approaches which the Commission proposes for the Fifth Framework Programme.
The idea behind the matrix approach proposed by Mr Desama, with its intersections between traditional fields and disciplines on the horizontal axis and the major problems facing Europe on the vertical axis, is very well reflected in the way in which the structure of the programmes is defined in the Commission's first working document on the Fifth Framework Programme. Furthermore, Parliament and the Commission both place the emphasis on the need for a sustained effort in innovation, technology transfer and financial structuring - that point, incidentally, was emphasized by a number of you, especially Mr Scapagnini - and also on coordination with the Union's other instruments for intervention and cooperation with the other European technological cooperation initiatives, such as COST and Eureka, which were mentioned in particular by Mr Malerba. This degree of agreement not only expresses the spontaneous similarity of the approach adopted by our two institutions but, as I said earlier, also bears witness to a positive interaction, the Commission having arranged to take due account of Parliament's views as and when it became aware of them.
As I said, I shall now move on to make various comments on specific points. Alongside the views that echo the Commission's plans, the report by the Committee on Research, Technological Development and Energy also contains a number of other very interesting recommendations which are certainly worthy of attention. To quote just a few examples relating to activities in the field of training and mobility, I am thinking particularly of the idea of special fellowships for established researchers from technologically advanced countries to work in the South, the idea of research fellowships in industrial and commercial undertakings, and a recommendation that particular attention should be paid to the problems of science teaching in European schools.
In the course of its future work on the Fifth Framework Programme, the Commission will ensure that these suggestions - and a number of others that are equally stimulating - are given due consideration. You must forgive me if I do not quote all these ideas here. I will note, though, the attention several honourable Members have given to the problems of small- and medium-sized enterprises, for example Mrs Quisthoudt-Rowohl or Mrs Plooij van Gorsel or Mrs Vaz da Silva.
The report does, however, also contain a number of recommendations which the Commission finds it impossible to adopt in view of the present status of the Treaties and the regulations for implementing the programmes. These are the recommendations which relate to institutional aspects and the programme management procedures. In actual fact, the possibility of specifically implementing a number of new ideas will depend on the extent to which the Intergovernmental Conference is going to make it possible to simplify the decision procedures in research matters. As you know, this is a considerable problem. Effective implementation of Articles 130k, l and n, for example, which would open the way to multi-track schemes, is hard to imagine except in the event of an extension of qualified majority voting.
Overall, and to summarize, the Commission can only welcome the general content of the report by the Committee on Research, Technological Development and Energy, and thank Parliament for this very valuable contribution to the continuing work on the Fifth Framework Programme.
What form is that work going to take? This is the third point I should like to bring up. I have already mentioned the first working document presented by the Commission last Wednesday. The detailed content of the Fifth Framework Programme is not yet described in that document, but it will be in a second working document which the Commission will be presenting early in 1997 - the formal proposal is planned for March that year. The intended objective is for the Council to achieve a common position under the Luxembourg presidency in November 1997 and for the new framework programme to be formally adopted in January 1998. I must emphasize that compliance with this timetable is essential if we are to avoid any break in the continuity of the European research effort.
To maximize the chances of achieving this, the Commission has decided to structure the institutional debate in a progressive series of stages, allowing elements of consensus to be achieved at every step. The preparation of the Fifth Framework Programme will occupy us intensively throughout 1997. But before we become fully involved in discussing it, we have to settle the question - which has been outstanding for several months now - of the financial complement to the Fourth Framework Programme. This is not a mere technical point but a political preliminary, especially as regards the task-force concept. The financial complement introduces a new approach to this point, and we must achieve a consensus on this before going any further. The advances achieved during recent weeks have brought us considerably closer to a decision, and I am quite hopeful that a policy agreement, perhaps even a common position, can be achieved at the 'research' council on 5 December.
As I am sure you know, bearing in mind the decision by the Ecofin Council not to revise the financial perspectives for 1997 and 1998, the sum proposed by the Commission has been revised downward. The informal trialogue which has just taken place this afternoon has confirmed the intention of the three institutions to go ahead. So I am quite hopeful that the procedure for adopting this financial complement, for which Parliament has made considerable efforts, can be finalized early next year. Once again, I should like to say how grateful I am for Parliament's support on this. I shall leave it at that.
Let me finish with one final comment. In the context of the preparations for economic and monetary union there is heavy pressure on national budgets, as many of you have emphasized. The Council's discussion of the Fifth Framework Programme is likely to be prolonged and difficult. The Commission is prepared to engage in the debate. The price to be paid is not too high if we can be certain of achieving the objective: a framework programme which really differs from its predecessors and contains real substance - and, also, if we are to fortify the European scientific culture as Mr Linkohr so rightly hopes.
The Commission counts on the support of Parliament and the broad convergence between Parliament's views and its own in a joint effort to ensure that this new programme can be adopted in good time and with a content which, in accordance with a formula to which I believe Parliament fully subscribes, will make it possible for European research to operate in the service of the public.

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

Public transport
President
The next item is the joint debate on the following reports:
A4-0289/96 by Mr Wijsenbeek, on behalf of the Committee on Transport and Tourism, on the Commission Green Paper on the Citizens' Network: fulfilling the potential of public passenger transport in Europe (COM(95)0601 - C40598/95); -A4-0291/96 by Mr Killilea, on behalf of the Committee on Transport and Tourism, on the proposal for a Council Regulation laying down the conditions under which non-resident carriers may operate national road passenger transport services within a Member State (COM(95)0729 - C4-0113/96-96/0002(SYN)); -A4-0292/96 by Mr Killilea, on behalf of the Committee on Transport and Tourism, on the proposal for a Council Regulation amending Council Regulation (EEC) No 684/92 on common rules for the international carriage of passengers by coach and bus (COM(96)0190 - C4-0338/96-96/0125(SYN)).I now call upon Mr Wijsenbeek, as rapporteur, to speak first. You have five minutes, Mr Wijsenbeek.

Wijsenbeek
Mr President, the real basis for the Commission's Green Paper on the Citizens' Network is our own initiative report on urban transport and congestion of June 1992. We were in fact ahead of our time. Despite that I should like on behalf of the whole House to congratulate Commissioner Kinnock on the fact that he understood the signal from Parliament and society and in the Green Paper is now following up a better management of traffic. That is why the Union as such is rightly involved in public transport despite the fact that transport is usually a matter for local and regional authorities. This is the question of subsidiarity. We in Europe can only protect the public's freedom to travel on the territory of the Member States, as stipulated in Article 8a of the Treaty, if the public's mobility is not restricted.
Mobility, as is generally recognised, is thwarted less by all sorts of rules and formal regulations than by physical and organisational restrictions. We as institutions of the EU together decided on the planning and setting up of the trans-European networks and created a not inconsiderable amount in the budget for it. I shall refrain here from going into the scandalous approach adopted by the Council to the present budget and the amounts in it for the TENs. The TENs will only make sense if we can build a reasonable link up to and from the major European transborder infrastructure.
When we look at the list of legal instruments appended to the Green Paper then the instruments to regulate public transport in the Union are already considerable. The main proposals in the Green Paper are on accessibility, communication, safety, travel comfort and environment. In each of these categories Parliament has made a number of additions, along with the proposed push and pull measures and the best practices proposals.
In the area of accessibility we, more than the Commission had already done, have focused attention on the 80 million citizens who for physical or functional reasons are less mobile, either permanently or temporarily. This should mainly be done by adapting material to old and disabled people and by adapting to secondary provisions in the dissemination of information.
We in this House believe that accessibility can be improved not only by adaptations in infrastructure, for example by planning separate provisions for various transport modalities, but also by improving town planning. Attention should be paid much more than hitherto to traffic from home to the workplace when new houses are built. When public transport is organised first of all it is, after some initial loss, later more than adequately recouped.
Safety should speak for itself but it cannot be said often enough that the number of traffic victims is unacceptably high. It is often the fault of differences in traffic legislation in the various Member States.
Travel comfort is not only a matter of better material. I and Parliament as a whole pay particular attention to the chain approach to transport, by planning connections in major urban conurbations where the majority of our citizens live and work today.
The environment is better protected if we encourage more citizens than is currently the case to use public transport. This should be done in conjunction with the Green Paper on external costs.
We must be guided in our actions by realism and take an overall look at transport problems, which takes us in this debate to the issues covered by Mr Killilea's reports.
' Don't tax car users and harass them out off existence but improve the quality and appeal of collective transport' .

Killilea
Mr President, firstly I have to say that the proposal dealt with in report A4-0291/96 to a great extent resembles Regulation No 2454/92 which was repealed by the Court of Justice in its judgment of 1 June 1994 in Case C-388/92 brought by the European Parliament which had not been reconsulted by the Council on a proposal for a regulation which differed considerably from the original Commission proposal.
Having said that, one of the key elements in establishing an internal market is the removal of the artificial barriers to a single market in the transport sector. The two proposals which I have the honour of presenting to Parliament this evening represent a further step in the development of a single transport market in the European Union. They will give bus companies from one EU country greater freedom to offer services to passengers in other Member States.
It makes sense for bus companies operating a service from one country to another to be able to pick up passengers at all points along the route. At present a bus company is allowed to sell tickets to passengers in the country of origin only. The best example I know is a bus company which operates a service from a part of the west of Ireland which I represent to London and is allowed to pick up passengers within Ireland but is forbidden to take on any new passengers in any of the major cities or towns in north or south Wales or in the north or south-west of England. Similarly on the return route, the bus company cannot pick up new passengers in any of the towns on the road from the east coast of Ireland to the west coast of Ireland.
These types of restrictions should be removed for a number of reasons. Firstly, it would allow international bus companies to compete directly with national bus companies on long-haul routes, thereby offering a greater range of services to passengers. Increased competition should also help to keep down fares charged on long-distance bus routes. It will of course be far easier to ensure the financial viability of bus routes, particularly those from regions of low population density in the periphery to the major urban centres, if the company providing the service is able to pick up passengers along the route being served by that bus.
In recent years the European Union has taken steps to liberalize air transport and some progress has also been made in opening up the rail market to greater competition. The proposals before Parliament today will ensure that long-distance bus operations will also be freer to respond to the demands of the market-place and one of the results will be greater pressure on airlines and rail companies to lower their fares on competing routes. Travellers, particularly those with limited funds, will have a greater range of low-cost travel options than has been the case in the past. The social benefits of cheap transport to people such as students, migrant workers in low-paying jobs and their families should not be underestimated.
For many years transport costs between peripheral regions and major urban centres of the Union, for example the one I cited between the west of Ireland and London, were artificially high because of the price cartels operated by the airlines and also by the train and ferry companies. It is worth recalling that in the days of price fixing by, for example Aer Lingus and British Airways, air fares between London and Irish airports were amongst the highest in all Europe. It is also worth recalling that at the time when bus companies were not allowed to offer services from Ireland to London, the railway and ferry companies also operated a price-fixing arrangement which resulted in unnecessarily very high and exceptional fares.
European legislation at last has ended price fixing on many, but by no means all, air routes. Long-haul bus companies have gradually developed a network of routes which now compete directly with the railways and the airlines. As a result, the cost of transport throughout Europe is on the way down with important social benefits for families divided by migration, for employment and, a better example, for educational reasons.
Transport costs are also a key factor in the tourism sector which is something we tend to forget. The proposals before Parliament today will help to reduce overland transport costs and will help to facilitate growth in tourism, particularly amongst younger people who are often not in a position to pay for air travel.
Finally, greater freedom to pick up passengers will encourage the more efficient use of the buses on a particular route and may reduce the overall number of buses on the roads, thereby reducing congestion and pollution levels along some of the transport corridors. I welcome the proposals put forward by the Commission, which will help in developing the single transport market within the Union. The Transport Committee has taken a very positive view of the value of these proposals and as rapporteur, I can assure you, Commissioner, that is the truth. Together with my colleagues in the Transport Committee, we have tabled a number of amendments which I believe will be supported and improve the text proposed by the Commissioner.
In conclusion may I also say that my own view, and that of the Transport Committee, is that Parliament should support the proposals put forward by the Commission which should also include the amendments adopted in the Transport Committee. On that point, on report A4-0291/96 as the coordinator of the UPE group, I have today withdrawn Amendments Nos 17 and 18. In report A4-0292/96 we have withdrawn Amendments Nos 29 and 30 leaving, with the exception of the committee's amendments, only two amendments by the Liberal Group. Perhaps Mr Wijsenbeek in his wisdom might also withdraw those.
It is important that these two reports and the conclusions from the Commission are before the Council for their final conclusions on 12 December. We should make every effort to have a common position adopted for that date or at least by the end of this year. I thank the committee and many of the assistants who helped me to produce these two important reports. It has taken quite some time and I want to express my appreciation to the staff of the Transport Committee for their wonderful work and support. It is often forgotten that these people work in a very dedicated way.

Friedrich
The issue here is the attempt to provide optimum cross-border links between the various carriers, and also to use them for cross-border travel. To achieve this ideal objective of enabling people to travel as efficiently, quickly and far as possible by public transport from any location in Europe is of course a difficult challenge. Yet it is worth making this effort, because the benefits would of course be a reduction in individual transportation, more energy savings, more pooling of transport and better utilization of the infrastructure.
It must be possible to improve coordination and linking between the various carriers that we already have. An important point here, in the view of the Committee on Economic and Monetary Affairs and Industrial Policy, is that the planning of networked transport systems should also allow flexibility in the forms of enterprise involved. The networks need not always be operated by state-owned or public enterprises, but there must be scope for flexible models, such as private/public partnerships or the granting of franchises. Governments should provide the public transport network, but not operate it. Of course, both governments and the European Union should provide incentives, start-up assistance, and should develop the infrastructure so as to define the area of operations for private initiatives as soon as possible.
In this context, there are one or two ideas I would like to put forward. In these days of weak economies, consideration should also be given to whether the European Union might not provide additional incentives. For example, perhaps not at this immediate moment but in the longer term, it might be possible to make a different use of the Structural Funds, when they lie fallow and unused for years at a time. This use of the resources of the Structural Funds should also be considered in connection with the European Investment Bank. More flexible options need to be worked out and devised here to enable the infrastructure for the citizens' networks to be developed throughout the whole of Europe. In this sense, the citizens' networks and their realization and gradual implementation will benefit the economic efficiency of Europe and promote opportunities to reduce unemployment. In principle, this is a worthwhile activity for the European Union.

Graenitz
Mr President, Commissioner, ladies and gentlemen, all of you perhaps future users of short-range public transport! First, I should like to say how glad I am that this Green Paper has been produced, and to thank the rapporteur for his efforts. I believe that short-range passenger transport concerns every single citizen of the Union, because involvement in community life depends on access to transport; and I believe that this is another very important reason why the trans-European networks, the long-range links, should be appropriately supplemented by local networks.
The opinion of the Committee on Research, Technological Development and Energy naturally deals with the points that the Committee spends most time discussing. When we, the European Union, agree to stabilize CO2 emissions that makes it necessary to plan our energy use much more efficiently. Road transport offers two particularly good ways of doing this: increased use of public transport, enabling more passengers to be carried for a lower energy input, and developing vehicles which use less energy, or different forms of energy.
Another thing that I believe we need to do, therefore, is to help make public transport more attractive. A particular contribution here can be made by another area covered by the Committee on Technological Development, because the use of telematics to improve the provision of information will make access to and use of transport easier.
One especially important aspect of research, vehicle development, is as I understand it a special interest of the Commissioner for Research, Mrs Cresson, and this is an area where I think a great deal of highly creative work can be done in Europe, which will also help the development of our industry.
There is one final point I would also like to mention: the documentation of especially suitable projects, throughout Europe, should help facilitate access to community life for all European citizens.

Mann, Thomas
Mr President, the aim of establishing a public transport network in Europe that is easily accessible and affordable is one deserving of permanent support. The idea is to integrate the entire network, conceptually and technically, from the transEuropean networks to the local transport systems. It is only right, and important, that the users of the transport services should be actively involved in these decision processes. But what about women?
The Green Paper makes only marginal mention of them - it talks about pregnant women, for example, or women travelling with pushchairs or small children. No mention whatever is made of their often severely reduced mobility, an area where the Commission's document deals only with people with disabilities, and the elderly.
Then there is the matter of safety and security. This cannot be confined to operational safety, where the Commission has rightly listed a number of standards. Personal safety is at least as important. There is an objective and specific risk to women, which is certainly not imaginary, when they have to use ill-lit railway stations or stand waiting for public transport outside the rush hour. When sections of public transport routes are unmanned, partly because of personnel cuts, and visibility in car parks is poor, the very real fear of attack is absolutely justified. We need a programme of effective counter-measures, integrating specific local experience from the regions of the Member States. Is it simply a matter of cost-effectiveness that no night taxis run after the last buses have gone, that there are not enough taxis for women only or reserved seats near the driver on buses and trains, that services are frequent at peak times but otherwise in short supply - or is thoughtlessness a contributory factor too? The sad consequence is that many women with work to do at home, with school-age children or in part-time employment feel cut off and isolated, especially in remote rural areas. The same applies to elderly women and those with disabilities.
All stages of transport policy, from planning through to implementation, must involve appropriate representation for women. In the opinion of the Committee on Women's Rights, I have only been able to give a brief outline of what women experience. Their influence on decisions taken by the social partners must be strengthened. They must be involved in comprehensive, clearly structured consultations. Mainstreaming has an important contribution to make to policy and action in the field of transport, as elsewhere. I have no doubt that the author of this good report on the Green Paper on the citizens' network, Mr Wijsenbeek, will agree with me.

Blokland
Mr President, this proposal for a regulation is influenced by the continuous liberalisation of cabotage transport of persons. The internal market is still a long way from being implemented in this field. The Council and the Commission do not appear to be making much progress here. I wonder why the Commission has delayed so long with this proposal since it contains very few changes from the lapsed regulation.
As draftsman of the opinion I have serious doubts about the relevance of Amendments Nos 9, 13 and 14 from the Committee on Transport and Tourism. The tiny reluctant step taken by the committee is either held up or set back by these amendments. And these amendments also mess up the systematic approach of the Commission proposal.
Risks of distortion of competition, social dumping, etc. can lead to the refusal or withdrawal of the licence under Article 4(2). The Economic Affairs Committee has unnecessarily in its Amendment No 2 proposed that 'threat to the exploitation of transport firms' be included in the definition of 'serious disruption' , in Article 9(2). The rapporteur's intention to delete Article 4 is completely illogical. His reasons are groundless and the aim of the amendment is in breach with the environmental interests and principles of the internal market. And another point is that Amendments Nos 13 and 14 are mutually contradictory. I urgently advise the House follow the Economic Affairs Committee and reject Amendments Nos 9, 13 and 14.
Finally I would like to ask Commissioner Kinnock a question. Can the Commissioner explain why the models for the documents under Article 6 and the check list or travel documentation under Article 7 are missing? I hope that they are not too complicated for the undertakings.

Castricum
Mr President, I am overwhelmed by the amount of speaking time allocated to me, but it means I can make the point that if public transport in Europe is to be organised with the various reports being cross-debated as we are doing here this evening then never again will a train or bus arrive in time, let alone will the man in the street be able to understand the slightest thing about it all.
On Monday morning there was a tail-back of around 300 km in the relatively small country of the Netherlands despite the fact that at the eleventh hour an agreement was reached which meant the planned rail strike was called off. The country came to a stand-still just like so many densely populated regions in the European Union do nearly every morning with the growing flood of private cars and lorries. The problems are recognised as such at all kinds of administrative levels. Even in Europe there are numerous reports which document the Commission's and Parliament's view that a coherent system of public transport is needed to meet the needs of mobility, to provide an alternative to the car and to enable the tens of millions of citizens who do not have or do not want to have a car to function properly in society, and Mr Mann pointed out that there is also a relatively large number of women among them.
The Green Paper on the citizens' network, the Green Paper on external costs and the White Paper on the future of the railways together form a triple manual on the thinking of the future of the transport of goods and people and indicate that the way ahead is towards a social economic and environmentally responsible transport policy.
While I recognise that the Commission and Parliament agree on the general guidelines I must see that at the same time that are many obstacles to putting the policy into practice.
We shall deal later with the external costs and the railway plans although we are justified in asking how the Commission envisages implementing a more integral transport policy in Europe.
But if I limit myself to the citizens' network I would like to thank Mr Wijsenbeek for his cooperation on his report. With the help of the Transport Committee his report contains just about all imaginable points on the subject. Even for us it is sometimes difficult to stick to the main points.
May I make a few comments? First of all, although we should not overestimate the authority of the European Union in drawing up a citizens' network no-one can dispute that an internal market cannot operate without a coherent system of public transport.
Secondly, the cross-border provisions are of extreme importance in all this. For the Netherlands, for example, a link to the European network of high speed trains is extremely important, so that a brake can be put on the short and medium term fast growth of air transport, among other things.
Thirdly, it is a big mistake to believe that cross-border transport is restricted solely to trains or planes. In border regions, for example, regional railways and buses play an important role in communication which is often underestimated. People without cars in these circumstances are still facing borders which we here imagine have been eliminated.
Fourthly, at the beginning of my speech I made the point that many more people than we realise are dependent on public transport and not the car for access to mobility and society. The elderly will increasingly turn to public transport. I would emphatically repeat the point that it is not the market but the relevant authorities that should be approached on both the level of provision and access to facilities. Now and even more in the future we must consider the needs of all those people who must make their way through life with varying degrees of disability.
The Green Paper on the citizens' network is proof of the Commission's responsibility for a system of public transport where the citizens can literally take to their heels. With subsidiarity in mind I have no over-great expectations of what Europe can do in the peripheral regions. But noblesse oblige , and the publication of the Green Paper and this public discussion must have a specific follow-up. I would like to hear what the Commission has to say on that this evening, for it is now time to move to action.

McIntosh
Mr President, I think we should all welcome Mr Castricum back after his absence last week when there was a discussion on the streets of Brussels about the White Paper on the future of the railways. We regretted that Mr Castricum could not be present to join this ongoing debate outside the European Parliament buildings last week but it is good to see him here tonight.
I congratulate the Commission on its Green Paper 'Citizens' network for public passenger transport' and especially congratulate Mr Wijsenbeek on his hard work in bringing this report before the committee and now before the House. I welcome the emphasis on promoting access to public transport in preference to an increasing obsession with the private car. It is good to see that research and development programmes at European level have a role to play in particular pursuing telematic projects in public transport.
Mr Wijsenbeek's report looks especially at the financing of public transport and promoting intermodality. I welcome the improvements to the environment and public health as well as the assistance to outlying peripheral areas of the Union. However, I am anxious to adhere to the principle of subsidiarity. I am also in favour of a subject which is close to Mr Wijsenbeek's heart, namely promotion of the use of the bicycle. Perhaps the Commissioner could see fit to promote the greater use of cycle paths throughout the European Union and easier access for bicycles to be carried on trains.
I also see the need for the facilitation of access to public transport for the disabled, the elderly and the less mobile. I hope the Commissioner and the rapporteur will join with me tonight in looking to support one specific mode of transport which the European Union has consistently supported, namely the Channel Tunnel. I am sure the Commission and Parliament will share my concern that the recent fire in the tunnel may have been started by a flare thrown from a lorry driver on the blockade at the entry to the tunnel. Will the Commission tonight promise a full inquiry into the causes of the Channel Tunnel fire and eliminate any potential cause which may be linked to the blockade. I would like the Commissioner to confirm tonight to the House that he fully supports the new European Union safety competence enshrined in Article 75 of the Treaty of Maastricht.
Turning briefly to Mr Killilea's excellent report on non-resident carriers being able to operate national road passenger transport services, I welcome the Commission proposal and Mr Killilea's report, especially to allow cabotage in the course of a regular international service. For the first time a coach travelling between London and Lisbon will be permitted to pick up and put down passengers in France or Spain. I welcome this freedom and the greater liberalization which this expresses. Greater competition in Europe's cross-national bus and coach services will mean cheaper fares. That is good news for travellers and for coach companies. The environment will benefit. Coaches in future will be able to offer a better, a more competitive service, and will no longer have to travel half-full or empty, adding to the expense of operators and environmental pollution. In conclusion, I welcome the Wijsenbeek and Killilea reports.

Lindqvist
Mr President, we all know that traffic, and especially the use of cars, causes a large proportion of the environmental problems, particularly in the big cities. The EU and individual Member States also committed themselves at the environmental conference in Rio to reduce carbon dioxide emissions, among other things. This is a responsibility which we must live up to.
The Commission's green paper on a transport network for all includes some good and positive ideas but no exact proposals. The Transport Committee's report drawn up by Mr Wijsenbeek on the other hand is a very good report which has the full support of the Liberal Group.
Mr President, I should particularly like to draw Commissioner Kinnock's attention to a number of points:
Railways, waterways, bicycles and public transport must be afforded priority over road bridges and motorways.
Public transport must be cheap, comfortable, punctual, safe and environmentally friendly; the responsibility for this should lie with local and regional authorities.
Ethanol, methanol, hydrogen gas, electricity and hybrid propulsion systems should take precedence over petrol and diesel.
Park-and-ride facilities, facilities for the disabled, good travel information and flexible working hours can increase the use of public transport.
Support from the EU for transport should in future go only to rail and public transport, not to road transport and motorways.
My congratulations on the report.

Van Dijk
Mr President, first of all I must express my surprise, and indeed perhaps also my annoyance, at the reaction of many of the Members of this House when Mrs Mann talked about the position of women in relation to the citizens' network. Seldom has there been such a ridiculous sniggering session as we have just witnessed. Mr Killilea, you should be paying special attention because you are also a member of the Committee on Women's Rights. That is the first thing I had to get off my chest.
But the second thing I must take up is the point made by Mr Wijsenbeek in the introduction to his report, for the sting was in the tail. While he defended his report with many fine words he said at the end that we must not put anything in the way of the car. I cannot put it better than Mr Castricum has already done, but every day, or nearly every day in Europe the situation has reached a stage that you wonder when the whole show will grind to a halt. When will we just not be able to move any more, in the Netherlands or in another part of Europe? And that time is fast approaching. We cannot keep on doing nothing to stop the use of the car and saying that we endorse a citizens' network only if the car can keep going. And that approach is contained in Mr Wijsenbeek's report, despite the many fine points. You will gather that we cannot give our support to this.
I would like to take up the points made by Frits Castricum here this evening. The Commission has not only published a Green Paper on the citizen's network. It has also recently produced a Green Paper on the internalisation of external costs in transport and a Green Paper on sustainable mobility. And we have also seen what a Green Paper on the urban environment could be like.
All these Green Papers are all very fine and dandy. They contain an accurate analysis of what the problem is, but unfortunately on the other hand the Commission is also promoting far-reaching liberalisation and far-reaching competition which alas contradicts sometimes the aims described in all these Green Papers.
It would be greatly to the credit of the Commission, and indeed also of this House, if we were once and for all to admit this and make the right choices. When we talk about the trans-European networks then it is also sensible to see the connection between these four or five Green Papers I have just mentioned and then we would be well advised not just to say blindly that we cannot dictate choices to the hauliers. We should be saying that we should try with decisions on infrastructure to force the choices in a certain direction, in conformity with the market as far as I am concerned. But these choices must be channelled in a certain direction, and I must regrettably say that so far despite the wonderful utterances on Rio or Agenda 21 or all these Green Papers, that is not being done. This Green Paper was a wonderful Green Paper and I hope that the connection is established between this and the other Green Papers so that the right measures are taken to make urban developments really safe for women, and just as good for other members of the public who want to use public transport, and that in addition to all this we manage to turn our towns and cities into pleasant places to live with fresh, clean air, and that means unfortunately that the car will have to take a hearty step backwards.

Novo Belenguer
Mr President, I am sure that none of those, admittedly few, of us present in this Chamber intended the least offence to any other honourable Member of this House.
To go back to the subject we are dealing with at the moment, the Commission document we are currently analysing highlights the potential of public transport in Europe and should be considered in conjunction with the document on external costs arising from use of private vehicles, Mrs Schmidbauer's report. I would like to congratulate the rapporteurs and the Commission for considering in their report the global objective of improving air quality and reducing traffic congestion and thereby the number of accidents and the time required to cross our major cities. I am glad to note that the Commission does not claim to direct public transport but to stimulate research and promote the development of better practices, thus fully respecting the principle of subsidiarity.
Mr President, the point I would like to emphasize in my intervention is the central role of the public service and of the universal service. As for the former, it is my understanding that it does not necessarily have to be linked to public companies, since a private transport company can also be obliged to provide certain services which are required by the general public. I am thinking here specifically of rural, peripheral or inter-island regions, which are less profitable. The obligations deriving from such a service are aimed at guaranteeing that all - absolutely everyone - have access to quality services at an affordable price. Strict application of this principle to a great extent contributes to the economic and social cohesion of such regions, involving essential principles of operation such as regularity, equality of access, universality and transparency.
In particular, I would like to refer to the content of Paragraph 9 of Mr Wijsenbeek's report which expresses the hope that not only the Commission but also national and local authorities will make an effort to obtain not just economic profitability but a social benefit, enhancing the mobility of citizens both in peripheral regions and in areas with sparse population density throughout the European Union.
Mr President, I would like to end by quoting a conclusion from the Commission report on the Intergovernmental Conference, which reads as follows: ' Building on a set of values which are common to all European societies, the European project aims to promote said values which combine the characteristic features of democracy with those of an open economy based on market dynamism, solidarity and cohesion. These values include citizens' access to universal services or services of general interest which make a contribution to the objectives of solidarity and equality of treatment' .

President
Mr Killilea will now speak on a point of order.

Killilea
Mr President, I hoped to be able to say something before Mrs Van Dijk left. She criticized my conduct when she said I sniggered at a comment made on the opinion given on the Wijsenbeek report. I passed a remark. I said it will raise the antennae of Mrs Van Dijk when she hears that and when I saw her name up to make a statement. I was not sniggering at the comment. I do not snigger at any such comments. Now that she has returned, she might withdraw her statement. I do not snigger. I passed a remark and her lop-sided views on such matters should be more balanced in the future. She should have a better sense of humour on such matters.

President
Thank you, Mr Killilea. We will not be entering into a debate on this matter. Your explanation will appear in the Minutes.

Van der Waal
Mr President, at first sight it might strike one as surprising that the Commission is venturing into the field of public transport in urban areas, which is the responsibility of national and local authorities. But the enormous problem of congestion which has arisen from the massive use of the private car is increasingly hampering the proper operation of the European transport market.
The Commission is to be congratulated on the thorough analysis of the problem which shows yet once more how big a part the private car plays in mobility. It is also the reason for the snail's pace at which traffic normally moves in the rush hour. The major problem is how the quality, safety and speed of public transport can be improved so that the car user has a genuine alternative. Or to put it in other words, how taxis, bicycles, hired cars and the private car can all be fitted into an integrated mobility system. The Commission document contains a number of useful ideas, among which the attempt to create managed competition is certainly not the least important. Public services is undoubtedly a job for central government. But the lack of any incentive for innovation and market orientation has proved to lead to a practice of large government contributions and frequently substandard quality in the public transport system. Incidentally, we must make sure that a coherent network remains in place when privatisation takes place with regional concessions being granted. There are risks in this respect particularly in border regions.
Finally I was happy to see that the Commission appreciates that it is first and foremost the local and national authorities that are responsible for solving the problem of congestion on their territory.
The Committee on Transport has not allowed itself to be overwhelmed by these restrictions. The resolution has, surprisingly enough with the cooperation of the rapporteur, become unfortunately an over lengthy list of all kinds of ideas and desiderata.

Swoboda
Mr President, I should like to start by congratulating Commissioner Kinnock on this Green Paper, and Mr Wijsenbeek on his report. Of course, one may wonder what a Green Paper or a parliamentary report can do to change the actual conditions in our cities. I personally, in my capacity as an elected councillor, have during the past eight years been responsible for transport planning in the city of Vienna, and in part for transport organization, too. I know, of course, that this kind of Green Paper does play a very important part in informing the general public of all the measures which the cities themselves have to take. This, of course, carries the seeds of conflict, because however broad a consensus we may have achieved within the committee, or may achieve now in this House, that is not to say that the implementation of the measures that have been mentioned may not give rise to many genuine conflicts. Agreement in principle is easy enough, but detailed action is more difficult.
However, there are several reasons why I regard the Green Paper as very crucial. First, as far as the environment is concerned, a lot has been said already. What has not been sufficiently mentioned is the radical, continuing destruction of our environment, especially around our cities - the overdevelopment that follows when urban growth and the development of a region are not based on public transport. A great deal of countryside and the relaxation it can offer people is being destroyed in Europe's regions.
Secondly, there are the social aspects, and these too have already been touched on. In our cities and countries, we often assume that everyone has a car. That's wrong. Many families do not have a car. In particular, women, children and older people who have no cars are reliant on public transport. This makes it important that an efficient public transport system should exist, at a reasonable cost, and that buses, trams and subways should run at short and regular intervals. Talking of trams, it fills me with pride to see an illustration of a Viennese tram in the Green Paper, though its real message is that forms of transport which a few years ago were considered old-fashioned and obsolete are now back in fashion. Many American cities are now adding to their existing transport facilities, with the utmost difficulty, the same tram systems that many European cities have been fortunate enough to preserve.
A third aspect which is not sufficiently brought out in the report by the Committee on Economic and Monetary Affairs and Industrial Policy is, of course, the economic one. Many cities can only remain economically attractive, attractive to investors, if their transport systems work efficiently. A point which is constantly overlooked is that even personal transport only functions efficiently if a great many people, as many as possible, use public transport. So there has to be a high modal split, so that, above all, the necessary commercial transport has room on the roads. My view, then, is that this is not necessarily a contradiction in terms, not a case of pillorying the car, for us to give enthusiastic support to public transport - the point is that appropriate scope should also be provided for necessary private transport.
My third and last point is this: I should like to point out that I believe the various European Union aid programmes should take even more account of public transport. I don't mean just the research programmes or the specific transport programmes but also, for example, the regional development programmes. I think that regional development systems such as the railway project or other projects should make more allowance, in particular, for the needs of public transport.

Grosch
Mr President, Commissioner, the Commission's proposal and Mr Killilea's report gave rise to an interesting committee discussion. Particularly interesting in my view is that this discussion can and must actually be taken further by means of an amendment. The existing proposal for a Regulation that has been under discussion here leaves various questions unanswered, and both the Commission's efforts and the report deserve credit for having provided clear answers to some of those questions. For one thing, they clarify the categories and make a clear distinction between those services that do require authorization and those that do not; and they also clarify the procedure for taking due account of the technical control of the vehicles - safety, in other words, and social aspects. In addition, the reports also have important things to say about a common transport policy, by standing up for the user's right to choose his means of transport; and they remind us of the need for liberalization to proceed in step with harmonization.
One amendment envisages excluding from the scope of application not only international regular services but also national services at urban, suburban and regional level. This, in my view, does not harm to the proposal as a whole. Regular urban and suburban services are usually part of the public service and, accordingly, involve aspects which have their place in a general discussion of public services, or even of the universal service. We know that some countries have set up public passenger transport systems as a service for the citizen without necessarily going through the tender procedure to ensure compliance with profitability criteria, while in some cases they actually form part of a deliberate employment policy and so would not satisfy any profitability calculation. The question of whether this is a good or bad thing is, at least, one reason for taking a closer look at this aspect. We are not trying to avoid this discussion - quite the reverse! Forthcoming reports will take us to the very heart of it. So it seems sensible to me, as proposed in this amendment, to conduct the debate within the framework of the general regulations for the granting of public service authorizations. There is more than one side to this problem - it has various aspects. One is the elimination of monopolies, including public monopolies. Another is safety and the environment, and another is employment, and taken together all these add up to a partnership between the state and the private sector. These aspects are a good enough reason to conduct a separate debate, and we trust that will be done before too long.

Sindal
Mr President, it is my opinion that the reports we are dealing with today are an extremely good contribution to the development of transport to the benefit of European citizens. It is partly a matter of inspiration, and partly one of legislation. One important aspect in this area, however, is that we as a Parliament also consider these matters from a national perspective. I have heard moving accounts from Ireland and The Netherlands. I would have liked to ask Mr Killilea - he is no longer here unfortunately - whether there is a bus route linking the Irish pubs around Europe that he is planning to set up, but perhaps we should dismiss this as a humorous comment. When we formulate the European regulations, we also have an obligation to look at things from different perspectives. We have city traffic, to which reference was made earlier. And we have rural traffic. There are different forms of transport culture, etc.
I am wholly in agreement with liberalisation. It is a good thing. But if tenders are invited for a given form of transport and a company wins the right to provide it, it cannot help matters if other companies operate on the same route without a licence. Some of the ideas referred to in the report by Mr Killilea would in practice have the effect of giving transport companies a free hand, even in cases where a company had been awarded a licence following the invitation to tender. This affects regional traffic. Coastal traffic off the individual countries in the form of regional traffic is therefore a matter which requires great attention. International transport from one country to another and permission to pick up passengers in the context of international transport systems is something quite different. This has my support, unless the routes in question have already been allocated. It is unfortunate that we have some situations in which there are parallel routes operated by both trains and several bus services, running half empty, for which fares are constantly reduced in order to win the 'battle' - just like the airspace situation. It is therefore very important that we give some thought to this.
I am unable to accept the comments on tax harmonisation made by Mr Killilea. I am quite prepared to discuss CO2 emission and pollution of the environment, but that is a very different thing. Mr Lindqvist is right about the priorities involved in viable transport systems. It therefore makes no sense at all when the rapporteur writes that in general terms one should be able to choose the car when one wants to, if all else fails. This means it is not collective transport we are providing for; it is a multiple-choice situation in which personal transport, in the form of a car, will win every time.
It must be assumed that the Council's attitude is more sophisticated. I am not clear about what the centralist Commission is about to produce as its final proposal. But if we want to see development here, it must be a combination of what Mr Killilea is proposing, what the Commission is putting forward and what the Council finally comes up with in its own right. I would support the development of common transport in Europe and collective traffic arrangements; and I do not have anything against liberalisation. But we must respect the different regional transport cultures. We are obliged to respect the development that has already taken place, otherwise we would actually be hindering something we want. It is also the case here that we must learn to walk before we can run.

Jarzembowski
Mr President, Commissioner, thank you for staying here so late, and thank you too, ladies and gentlemen, my unfortunate colleagues who, as always, find themselves discussing the transport sector at 11 p.m.! We Christian Democrats naturally welcome and support the Commission's Green Paper, because it is both right and necessary that the European Union should promote an exchange of experiences between cities and conurbations on ways of improving short-distance public transport, in particular, and should support model projects to increase the intermodality of transport movements.
But we Christian Democrats must also emphasize that we take the principle of subsidiarity in the Union seriously. That is why we stress the point that primary responsibility for short-distance public transport in both town and country should remain with the municipal and regional authorities and independently administered organizations, because it is they that have the closer view and they who are answerable to the citizen.
Furthermore, we Christian Democrats - unlike those Social Democrats who are still with us - do not want to see any European interference in the affairs of the municipal, city and regional authorities. We therefore reject, among other things, the following demands by the Committee on Transport and Tourism. We do not regard it as necessary for Europe to require ecobalances to be produced before government grants are made. We reject the general recommendation - I am overstating this, but if you take it literally it could be interpreted that way - that transport infrastructures must be laid underground. Why must Europe recommend that to the local and regional authorities?
Thirdly, we as Christian Democrats also reject the request to the Commission to consider, so far as possible, whether it might come up with additional legal requirements for short-distance public transport. Mr Kinnock, don't go to too much trouble! Don't interfere with the powers of the local and regional authorities.
I have just two comments on the Killilea report. The completion of the single market is right and necessary, and in that light it is also necessary to open up cross-border passenger transport by bus within the Union. But, Mr Kinnock, this liberalization must not lead to any 'reverse discrimination' against enterprises. It cannot be right, for example, for Dutch enterprises carrying on cross-border activities in Germany to be subject to different regulations, and less strict regulations, than a German enterprise competing with them. There must be no discrimination here.
My second example illustrates where we have to watch out with the opening-up of market access opportunities. Simply scrapping the prohibition of cabotage, as Mr Grosch proposes, must not result in the collapse of the existing cross-border short-distance public passenger transport systems. So this sector should be protected against excessive upheavals by the prior introduction of unambiguous regulations covering the granting of concessions for short-distance public transport services.

President
Thank you, Mr Jarzembowski. I support equality between men and women and therefore make no distinction. If you take a look at that part of the sitting over which I preside, you will see that, at the precise moment the time allotted to you expires, be the speaker male or female, I advise you. You then extend the time for a greater or lesser period, but this is something you do under your own responsibility. Therefore I would say again that I support equality between men and women and therefore, in this Chamber, I give you exactly the same treatment, just as I am now going to give to Mr Koch, who has two minutes.

Koch
Mr President, Commissioner, ladies and gentlemen, I welcome the Commission's proposal on the introduction of common rules for cross-border passenger traffic by motor bus. Improved opportunities for motor buses within the single market are not only sensible but long overdue. Buses, after all, are among the most environment-friendly and safest modes of transport and guarantee mobility which can be sustained in the long run.
In conjunction with the amendments adopted by the Committee on Transport and Tourism, these measures will make it possible, first, to achieve a sensible balance and parallel development between liberalization, the crossborder carriage of passengers and the harmonization of the framework conditions. Too often in the past we have liberalized things in Europe without harmonizing the foundations and underlying conditions. That must not happen again!
The second effect will be to improve the safety and security aspects that are so important to all concerned. I am thinking here not only of transport safety in the technical sense but also of greater planning and investment security for small- and medium-sized enterprises.
Thirdly, I think it is noteworthy that the costs and management expense of bus companies are minimized if they obtain a Community licence. I congratulate the rapporteur on his success here: while retaining the aims and objectives of this proposal for a Regulation he has managed to clarify it, cut away the red tape and simplify it; and, in maintaining the citizen's right to a free choice of mode of transport, he has helped to increase transparency and legal certainty, and so to bring the transport plans closer to the citizen.

Kinnock, Neil
Mr President, this has been a very interesting and quite lengthy debate. It has had a few elements which are worthy of specific reference. The first is that Mr Swoboda made his maiden speech in this Chamber. It was a very effective and well-informed speech and I congratulate him on it. It is what I would expect from someone with his very extensive experience in public transport as the extremely successful chairman of public transport in Vienna for some years past. May I say that our gain is Vienna's loss.
I was also very touched by a scene which took place during the course of the debate. There was a danger at one time that the normal good temper of this House was being slightly fractured by the unlikely dispute that arose between Mrs Van Dijk, who is a very sweet-tempered person, and Mr Killilea, who is conviviality itself. I am happy to report that after some danger of an acerbic exchange, I witnessed them later on touchingly together. I am sure that bodes well for the future of parliamentary cooperation.
Today's discussion has been a joint debate on the Commission Green Paper and on two Commission proposals for legislation. I understand Parliament's desire to organize the debate on the citizens' network in conjunction with the two proposals on road passenger transport which was the subject of Mr Killilea's reports. I know that there are others, like me, who hope that the mixture of issues does not distract attention either from the need to reach a consensus on the citizens' network as we get into the detail of the legislative proposals or distract attention from the important issues relating to Mr Killilea's reports. I know that the House will understand if I concentrate my remarks on the citizens' network although I will, as is the convention of the House, indicate the Commission's position on each of the amendments in Mr Killilea's report.
I regret that the variety of issues I have to cover in my intervention will mean a slightly longer contribution than I would have liked. I begin by congratulating the Committee on Transport and Tourism and their rapporteur Mr Wijsenbeek for the characteristically thoughtful and reasoned report which has been so well presented. His commitment to developing public transport is well known and it is a determination which is evident right throughout his report. It is also a commitment which I strongly endorse. I have to say, however, that when I launched the citizens' network Green Paper last January there were those who wondered aloud if this was an area where the Commission had an interest. When I called for a wide-ranging debate on the future development of public passenger transport in the European Union, there were those who felt that only a few special interest groups would actually participate.
I think Parliament would agree with me that the doubters were wrong. The responses have been numerous, informative and lively and they have come from national, regional and local government, from users and operators, from trades unions and police officers, and from individual citizens. The debate is far from over and this report is a valuable part of that debate. Obviously I cannot address every single one of the detailed recommendations of Mr Wijsenbeek's report but I will readily respond to the main issues.
On competence of the Union, I share the belief that the Union must encourage an integrated planning process for transport systems and I also share the belief that in all cases users must be closely involved in planning and decision-making. We forcefully made that point in the Green Paper. It is clear that most of the issues at stake: the kind of urban transport that is chosen, its quality, the fares and other significant features are best dealt with at the responsible local and regional level as Mr Jarzembowski forcefully argued, partly because of subsidiarity and partly also because of plain ordinary decent common sense.
But the Union does have the task of ensuring that the Community legal framework, governing for example the introduction of public services and related exclusive concessions, is the right legal framework. The Union can also help to focus the discussion on important subjects and facilitate the exchange of information on best available practices which is something we have already been trying to do. On financing, I agree that, wherever possible, public transport should be financed by revenue from fares. It is worth stressing, however, that when considering subsidies, the relevant authorities should also take into account the potential cross-sector benefits of aid to public transport, in particular in the way in which public transport can assist with general levels of health and obviously with social welfare.
The House will know I attach the highest importance to the principle and to promotion of intermodality. That is why the Commission founded the intermodality R & D taskforce. We will continue to work to develop the integration of all the different transport modes, including private cars. They are obviously a vital part of the transport chain, especially for those who have access to cars. However, obviously we need to do everything possible to ensure that the mobility which cars can usefully provide is not stifled or, indeed, eradicated by congestion which, as several speakers have pointed out in the course of debate and elsewhere, is a real danger.
On the specific request in the report for the Commission to publish figures for car use and public transport use by women in the Member States, I have to say, with regret, that such data is not available. Even without it, I emphasize my commitment which is shared in this House, to promote transport systems which all our citizens feel safe in using both day and night. Naturally I agree on the need to provide a safe environment in which passengers and operators are free from the fear of physical attack. That is important for all passengers, not just for women, though their particular concerns must be accepted and acted upon. They have particular and in many cases justified feelings of vulnerability.
Regarding cycle use, we will consider within the limits of subsidiarity how to encourage this efficient and environmentally-friendly mode of transport which I know is a matter of active and admirable interest to Mr Wijsenbeek as it is to many others. On the subject of land-use planning I share the view that transport issues must be taken into account at an early stage in discussions on land use and those decisions, by their very nature, are best taken at local level. However, the Commission will study this subject further in order to provide a useful input into the discussions on how transport considerations can best be taken into account if the character of land use is changed or intensified.
The greater part of the Committee on Transport and Tourism's report is rightly devoted to the specific topic of public transport. Many of these suggestions are very specific and I know that honourable Members understand that the Commission, in the spirit of subsidiarity and proportionality, had to confine itself in the Green Paper to those areas where we felt we could bring added value. That said, however, I agree fully with the report's comments on staff training and qualifications and on the need to meet the needs of people with the great diversity of mobility impairments that can affect people at different times of their lives.
However, I do not share the view that the concept of universal service provision is appropriate to public transport. I take that view not through any doctrinaire reason but simply because, while the concept properly exists in the postal and telecommunications sectors in relation to the provision of a specific single service, the sheer diversified nature of public transport does not lend itself to such a concept in practice.
I am puzzled by the criticism that in the Green Paper we neglected the needs of part-time workers. The concept of the citizens' network applies to all passengers. Therefore, we made no distinction between them other than to highlight the specific needs of the mobility-impaired. On the report's references to environment and health, I fully support moves to make transport less polluting and I note the support for the different Commission programmes to that end. I also share the report's view that there is much that new technology can offer to resolve some significant transport problems and plainly we will continue our efforts with the development of transport telematics, alternative energy technologies and other applications of modern technology that really can alleviate major traffic problems.
To conclude on the citizens' network, we are now examining the wealth of data contained in the responses to the Green Paper. Based on that information, in the New Year I shall produce a follow-up communication which will set out actions and measures we propose to undertake at Community level in order to advance the development of the citizens' network. In keeping with what I said earlier on subsidiarity in this sector, the action plan for the Commission will necessarily have limitations but it is essential to keep the topic alive in political discussions and we will do that with the cooperation, I trust, of this Parliament.
I now turn very briefly to the two proposals on road passenger transport. Obviously both proposals are designed to facilitate coach and bus transport, both national and international and are therefore fully consistent with the approach set out in the Green Paper. I would like to acknowledge the work Mr Killilea has done on behalf of the Committee on Transport and Tourism and acknowledge it with gratitude.
On the first proposal relating to cabotage, the Commission can accept Amendments Nos 1, 3, 4 and Amendment No 6 in principle, Amendments Nos 9 and 11 subject to ensuring they are consistent with Article 58 of the Treaty, Amendment No 13 so far as it refers to the exclusion of urban and suburban transport, Amendment No 14 and as a consequence the first parts of Amendments Nos 18 and 16, paragraph 2. The remaining amendments cannot be accepted. Amendment No 2 because we have accepted Amendment No 1 which is very similar. Amendment No 5 detracts from our goal of promoting coach and bus transport. Amendment No 7 is not relevant to this proposal. We cannot accept Amendment No 8 because we accept Amendment No 9. Amendment No 10 is incompatible with freedom to provide services and most of Amendment No 13 would excessively limit cabotage rights.
The new definition introduced in Amendment No 12 is inconsistent with our aim of harmonizing the definition for the two regulations in question. Finally, Amendment No 15 and the first part of Amendment No 16 cannot be accepted as the information stipulated will be provided in the report envisaged under the proposed Article 16. Obviously the date of 31 December 1996 is far too soon for everything except being New Year's Eve.
On the second proposal relating to international carriage, the Commission can accept Amendment No 1, the second part of Amendment No 5, Amendments Nos 6 and 11 so far as they refer to the exclusion of urban and suburban transport, Amendment No 7 in principle, the new definitions introduced in Amendments Nos 12 and 13, and Amendment Nos 17, 18 and 28.
I have to say that the remaining amendments are unacceptable. I will conclude my remarks now but gladly provide the reasoning behind our view. The dates proposed in Amendments Nos 24, 25 and 26 are too soon. Finally, the call for both the Council and Commission regulations to be codified cannot be supported as this is outside the scope of the proposal.
I am not sure Mr Killilea will necessarily feel that I have done full justice to his reports by limiting my comments to the Commission's position on the amendments proposed. I regret that but he understands the reasons why I have to take this approach. I hope therefore that on this occasion he will accept my thanks for his thorough work and appreciate my reasons for my attempted brevity, especially at this late hour. However, I expect that he like me will have appreciated the fact that I had a backing chorus for part of my speech.

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

Summer time
President
The next item is the report (A4-0333/96) by Mr Belleré, on behalf of the Committee on Transport and Tourism, on the proposal for an eighth European Parliament and Council Directive on summer-time arrangements (COM(96)0106 - C4-0252/96-96/0082 COD).
Mr Belleré, you have the floor for five minutes.

Belleré
Mr President, Commissioner, ladies and gentlemen, on the proposal for an eighth European Parliament and Council Directive on summer-time arrangements, I, as the rapporteur, agree with the draft opinion produced by Mr Blokland as the draftsman of the opinion of the Committee on the Environment, Public Health and Consumer Protection, especially when he states at the end of his opinion that summer time has been a common benefit in Europe for many years now.
This is no place for a history of the directives dealing with these problems, but I remind the House that no fewer than 16 years have passed since the first directive in 1980, the seventh, dated 30 May 1994, having come into force only in 1996 and being valid until 1997, under which official summer time begins on the last Sunday in March and ends on the last Sunday in October for all Member States.
The eighth directive proposed by the Council and the European Parliament defining summer time as beginning on the last Sunday in March and ending on the last Sunday in October has my agreement, since I believe it is a priority for the period of summer time to be harmonized.
I must however make a number of points which emerge from an analysis of the amendments tabled. First, the summer-time argument lends itself to differences of opinion because of the different experiences of each Member State. Consequently, the opinion drafted by me takes account of my own experiences, and I am well aware that it is difficult to have a single yardstick for the problem and that it is hardly possible to satisfy everybody. Invoking the principle of subsidiarity, therefore, I believe that any changes to the summer-time system, and the decision whether or not to implement it, should be entirely a matter for each Member State.
Furthermore, the very great majority of the public favours retaining summer time. That was the conclusion reached by a survey commissioned by me and involving a sample of more than 1000 people in a number of Member States, belonging to various social classes; no fewer than 84 % were in favour of summer time. The fact is that the availability of an extra hour's daylight benefits all kinds of activities, from sport and recreation to the activities of the tourist services, especially in the southern European countries where the days are shorter. In some Mediterranean States the so-called 'open-air museums' allow visitors to enter until twilight, which is beneficial for leisure time and so-called 'cultural' tourism. Another point is the saving of energy, especially in the evenings. In Italy, which unlike France or Austria is not self-sufficient in energy, the 1996 saving was assessed at about 900 million kWh.
On the other hand, I regard as negligible the harmful effects on sleep rhythm and the serious consequences, about which such fears have been expressed, for the health of young schoolchildren and babies. There is no real evidence of any of this, nor is there any evidence for the adverse effects of summer time on road safety. Common sense inclines me to the view that better light is likely to improve road safety. As regards nitrogen levels, we would need reliable statistics and data from the various Member States.
Finally, however, it is necessary to bear in mind the Eastern European time zone which includes Finland, Greece and those eastern countries that have already applied for membership of the European Union; for those countries, it is not realistic to hold out any prospect of a European Community, in the near future, with a uniform timetable for summer time.
In conclusion, I applaud the initiative of the Commission in making this proposal, and I emphasize that, over and above the differences of opinion, it is a matter for each Member State, while endeavouring to achieve a maximum of harmonization, to decide which summer-time system to apply, always bearing in mind that common sense must incline us to believe that time differences between contiguous Member States - and this was the sense of the amendment tabled by Mr Wijsenbeek - should not exceed one hour.

Blokland
Mr President, when the present directive on summertime was debated in Parliament, the Committee on the Environment was requested to study the non-economic effects of summertime, the effects on the environment, public health, safety of traffic and consumer interest.
That study has meanwhile been done and the results of it published. The results have not produced any startling surprises, in other words it confirms to a large extent the views on the pros and cons which were already familiar. My conclusion is therefore that there are no convincing arguments from the point of view of either public health, the environment or consumer protection to justify abolishing summertime. So the Environment Committee supports the Commission proposal.
We know that there is a strong lobby in France against summertime; it claims that the majority of the French people want to abolish it. Now I cannot prove it, but I would argue that none of the studies which have been done into problems of sleep, the environment, energy consumption and traffic safety have produced any convincing results in support of the alleged disadvantages. On the contrary, public opinion in Europe as a whole has come out strongly in favour of summertime. That is seen by the mere fact that for donkeys' years now a large number of Member States, including France, has been using summertime.
Indeed it was also France that come up with the idea of saving energy during the oil crisis. I personally still find energy savings the most important reason for keeping summertime. The advantages of it for recreation purposes are well documented.
The Committee on the Environment therefore agrees with the rapporteur, Mr Belleré, that summertime is a good thing. European travellers would also find it a big nuisance if France were unilaterally to abolish summertime. There are four high speed trains from the Netherlands to Paris alone every day. In a time of high speed trains, where everyone is trying to save minutes, we cannot afford to have time differences of maybe up to two hours between countries. That just does not make sense.
Finally the Belleré report contains three amendments which open the possibility of any country introducing summertime or not, as it wants. I do not think that is very sensible. Any country that does not want to do so is free so to decide, but it does not need to be written into the text of the directive. That only creates confusion.

President
Thank you, Mr Blokland. Ladies and gentlemen, the wonderful and sophisticated electronics with which this Chamber is endowed often gives us problems and the electronic clock is currently not working. You will have to rely on my personal judgement when I advise you that your allotted time has expired.
The first person to have to rely on this is Mr Waidelich, on behalf of the Group of the Party of European Socialists. Mr Waidelich, you have four minutes.

Waidelich
Mr President, there are many good arguments in favour of summer time, including the fact that, as the rapporteur stated earlier, we extend the day and have lighter evenings; there is also the fact that summer time has a positive effect on tourism, recreational activities and the service industries. There are also studies which demonstrate that summer time can contribute to both energy saving and greater road safety.
A majority of the people in the EU are also in favour of keeping summer time. Nevertheless, one does sometimes hear strange arguments against summer time, such as that children in the North cannot sleep and that they go to bed late, that is to say only once it gets dark. If darkness were the crucial factor for sleep children in Sweden, for example, would scarcely sleep an hour in mid-summer but 18-19 hours in mid-winter. This demonstrates that there is a certain lack of reason in the debate.
This report and the Commission's proposal do not question the idea of summer time. They are concerned with having summer time start and end on the same date throughout the EU, which it should be pointed out is already the case as of this year. Despite the fact that the system is already in operation it is now being said that the Council of Ministers is considering abandoning the principle of a common summer time throughout the EU. I believe this would be ill-advised, firstly as a matter of principle: if summer time were abolished in some countries we might forgo the positive effects, such as energy savings and road safety. Secondly, and more tangibly, differing summer time arrangements - for example if the common date for starting and ending summer time were abandoned in certain EU countries - could be prejudicial to the free movement of goods and services. It could also lead to increased inconvenience in sectors such as transport and telecommunications. There are already enough complications in the EU today with three different time zones.
It would therefore be interesting to hear now whether Commissioner Kinnock and the Commission have any further information on the Council of Ministers' deliberations or any observations on the subject. Otherwise we must wait for the Council to make a proposal to Parliament in due course. In conclusion may I, on behalf of the Socialist Group, applaud the report and the amendments proposed by the committee.

President
Thank you, Mr Waidelich. You have acted just as if you were a stopwatch and have finished exactly on four minutes. If there are any further problems with the clock, we will use you as a timer-keeper, but as the clock is now working I can guarantee that our next speaker, Mrs Bennasar, on behalf of the Group of the European People's Party, will have her allotted period of three minutes measured with complete accuracy.

Bennasar Tous
Mr President, Commissioner, to speak about summer time at 11.30 at night in winter instils a degree of nostalgia in one. However, I would nevertheless like to congratulate Mr Belleré on his favourable report on the proposal for an eighth Parliament and Council Directive on summer-time arrangements.
At the time of the first oil crisis, in 1973, governments the world over had to seek energy-saving measures and, in 1976, Europe began its summer-time experiment. Over the years since then, this scheme has revealed objective situational differences in Member States of the European Union.
With the present directive, the European Union is reexamining the economic advantages of time changes together with the subtle disadvantages which barely affect people and their work output, for example. There may be a few small alterations but there are no major disruptions as such. For some, the energy saving arising from the clocks being put forward should be accompanied by parallel measures, such as systematic programmes for limiting domestic consumption.
Be that as it may, this proposal for an 8th directive analyses the results of an extra hour of daylight and comes to the conclusion that the majority of citizens are in favour of its continuing. As has already been stated, an extra hour of daylight is especially beneficial to leisure, open-air activities, tourism, public health, energy and road safety. In Spain, the annual energy saving amounts to 11, 500 million pesetas, equivalent to 600 million kilowatts/hour.
The 7th directive contains the proposal to harmonize the period of application: from 1 a.m. on the last Sunday in March to 1 a.m. on the last Sunday in October. Implementation of this measure will end the chaos which, especially for transport, tourism and telecommunications, causes various countries to effect the time change on different dates. The previous directive already advised Members of the Community that, in 1996, the time-change would not take place until 27 October. Until that time, 10 European countries made the changeover at the end of September and the rest at the end of October.
I would therefore, on behalf of the European People's Party, like to express my Group's support for this report which, whilst respecting subsidiarity, proposes something which is indeed within the competence of the Community: full harmonization of dates and summer time, since the time system and its application is the exclusive competence of each Member State. Congratulations to the rapporteur for the common sense he has shown.

Wijsenbeek
Mr President, I used to be quite orthodox. And I say that to Mr Blokland, but not to agree with him. I used to think it necessary for all Member States to stick to one and the same time. That was in the old days when the EEC was still small and unspoiled. But since then we have expanded from Six to Nine, then Twelve, then Fifteen. After the IGC is finished we will be moving to even greater expansion. This is not the time nor place to go into that. But it is an uncontroversial fact that this has meant that summertime in the Union has changed quite considerably. And I am leaving aside such exotic places as the Azores or the Canaries which in geographical terms belong to the American and African continents respectively.
If we decide in the future united states of Europe to have different time zones such as in the present United States of America, then that is all right by me. And I would even be consistent and not object to any Member State refusing to bring in summertime or wintertime. If that is what some countries want, then that is equally acceptable.
But that does not mean to say that for reasons of traffic or other practical purposes one single time in Europe would not be simpler. Against that you must realise, and I make this point unlike the rapporteur, whom I incidentally congratulate, that traffic safety has also disadvantages in summertime, especially as we have had to give in to British stubbornness and allow them to wait until October before changing over. For then it is dark in the early morning when children go off to school.
Finally I urge you to accept my amendment which the committee took on board to allow a maximum of one hour's time difference between each Member State and I would like to hear the Commission's view on the proposal for limitrophe countries.

Macartney
Mr President, this is one of these very sensitive questions in some parts of Europe and the further north you go the more sensitive it becomes. Ironically, not where Santa Claus lives right up in the Arctic Circle but in the intermediate zone and Scotland in particular, and especially in the islands like Shetland and the Western Isles, this has become a very hot potato indeed. It has all been swallowed up in the feeling that somehow Brussels is going to dictate to us and we are going to have one time-zone imposed on.
So I am delighted to see that on this occasion Brussels is actually being very sympathetic and sensible and not trying to impose a single zone from the Canary Islands across to Finland. What is proposed is a very sensible measure that the change-over from summer-time to winter-time will be the same throughout Europe, so you do not have the nonsense of a few weeks in which the time-tables are different in a different time zone. It is good to see Brussels being sympathetic and I think this Parliament will support it. There are sensible opt-outs for Guyana, the Canary Isles and so on and we should support this unreservedly.

Schierhuber
Mr President, Commissioner, ladies and gentlemen, we have been living with summertime for quite a while now, and we are not really consciously aware of its adverse effects. The tiresome changeover twice a year is, I believe, a negligible problem. When summertime was introduced in Austria, it came in for some very heated criticism. For example, there were people who predicted that there might be or would be problems for farmers, because nature is no respecter of clocks and farmers would not really derive any benefit from summertime. No doubt it would be easier to leave the time unchanged throughout the year. Even so, we should be conscious of the advantages of summertime, and especially the advantages of a standardized arrangement.
I am committed to the single market, and without a uniform arrangement there can be no question of a functional single market, which is the necessary basis for greater cohesion in Europe. Consequently, the set dates for the start and the end of summertime are to be welcomed. In addition, we currently have three time zones within the Community. It is important to ensure that the time difference between countries is never more than one hour, which actually is already too much. First and foremost, our concern must be to protect consumers. It is in the interest of consumers - travellers, for example - to have arrangements that are as standardized and simple as possible, another argument in favour of an EU-wide arrangement.
In the countries of central and southern Europe, summertime offers advantages for the consumer, and for industry too. Longer days open up additional opportunities in leisure planning and so have a beneficial effect on the leisure industry. Longer days are also important to the tourist industry in central and southern Europe: many museums and tourist leisure facilities benefit from the extra daylight, and this in turn benefits the tourists themselves. Then there are also those matters of transport safety that have already been mentioned. The fact remains, in any case, that summertime is very popular with a large proportion of Europe's population. Let us simply make the framework as simple as possible and so agree to the Commission's proposal.

Cornelissen
Mr President, summertime benefits tourism and recreation and undoubtedly encourages leisure activities and sport. It also fits well into a policy on energy savings and promoting safety in traffic. Surveys indicate that the majority of our citizens want summertime. And so we must retain it.
Summertime must be retained in all Member States of the European Union in its present composition. I do not agree with the French approach that Member States themselves should be allowed to chose whether to introduce it or not. Will the Commissioner promise to fight that French request? It would really be quite remarkable if in a citizens' Europe one of the Member States in the heart of the European Union were not to swim with the tide, with all the resultant problems for international transport and traffic.
My second question to the Commission is whether it would not benefit traffic safety if the end of summertime were to be brought forward, by a month or at least a week or two?
May I in conclusion congratulate the rapporteur on his report which was adopted unanimously in the Committee on Transport and Tourism?

Kinnock, Neil
Mr President, again this has been a memorable debate, probably most memorable for Mr Blokland. He will recall that when he was speaking on summer-time in the European Parliament time actually stood still. This was a memorable and earth-shattering event and I am sure it is marked in his memory for ever.
The one thing I regret in what was an altogether positive and informative debate was the fact that, whilst eight or nine Member States were represented here by elected Members of Parliament, sadly there was no French Member. We know of the great interest in these affairs which is said to exist in the Republic of France.
As the House will know, the summer-time regime was originally introduced by a national decision in several Member States mostly at the end of the 1970s. The objective of the first directive of the Community which entered into force in 1981 was the gradual harmonization of the timetable of the summer-time period to set common dates for the beginning and the end of this period in all Community Member States.
The main purpose of the Community arrangements was to remove obstacles to the free movement of goods, services and people provided by the differing national summer-time arrangements. Full harmonization was finally achieved with the seventh Directive of 1994 which specified that in 1996 and 1997 the summer-time period would begin on the last Sunday in March and end on the last Sunday in October in all Members States without exception. In the meanwhile almost all other European third countries, interestingly, have introduced a summer-time regime and are applying it in step with the Community directive. There could be no finer vindication of the points made by several Members in the course of this debate.
The findings of a study carried out on behalf of the Commission last year on the effects of the application of summer-time in the European Union have recalled important benefits generated by summer-time particularly in tourism, in the leisure industry as well as in public health and road safety. Moreover, the various sectors which were consulted by the Commission at a hearing held in September 1995 expressed themselves largely in favour of the system provided that the timetable is fully harmonized throughout the Union.
Therefore, the proposal for an eighth Directive which is being considered tonight lays down the same arrangements as introduced by the seventh Directive for 1996 and 1997. For reasons of timetabling, particularly in the transport and communications sectors which expressed their wish to have a sufficiently long programming period, it is also suggested that we set the summer-timetable for a four-year period, that is for 1998, 1999, 2000 and 2001. I should like to thank the rapporteur Mr Belleré for his accurate and thorough examination of the issue and in particular of the reports submitted by the Commission on the application of summer-time. Naturally I am very pleased to note that the rapporteur shares most of the conclusions of our report and has so effectively supported the Commission proposal.
All that being said, I must confess some surprise at the amendments tabled for the approval of this House. On Amendments Nos 1 and 2, the Commission would like to point out that any arrangement enabling any Member State not to apply a summer-time regime would be contrary to the objective of harmonization which is the main purpose of the summer-time directive. As a matter of fact, the abandonment of summer-time by one or several Member States while the directive is in force would certainly create the same negative effects as those generated in the past in the transport and communications sectors when there was no Community legislation in this matter. The points made on that specific aspect of the issue by Members in the course of this debate have been very telling.
In this respect I should like to remind the House of the findings of a study carried out in 1993 on the costs of different dates for return to winter-time. The study showed that the main negative effects fell on airlines, railways and ferry companies though a range of other organizations such as port operators, travel agencies and financial organizations were also identified as potentially being affected disadvantageously. Therefore, the Commission considers that the reintroduction of divergencies would constitute a backward step in the harmonization that the Community achieved with the seventh Directive and would affect not only the good functioning of the internal market but also transport and communications with European third countries which are applying the summer-time regime. For all those reasons the Commission cannot accept Amendments Nos 1 and 2.
On Amendment No 3 the Commission considers that it goes beyond the scope of this proposal which is limited to harmonizing the timetable of the summer-time period. The arrangements proposed in the report would limit national decisions regarding time arrangements other than the application of a summer-time regime. That would be contrary to the principle of subsidiarity according to which any decision regarding other time arrangements, falls within Member States' competence and their competence alone. Consequently, the Commission cannot accept that particular amendment.
In conclusion, the Commission maintains its directive proposal as it stands because it complies fully with the mission of harmonization which was given to the Commission by Member States in order to remove any obstacles to the free movement of goods, services and people throughout the Community. That position will remain. I would only add one sentence of strictly personal emphasis. It is my view that harmonization of this kind, as several Members have said, has had measurable advantages in the reduction of road dangers and in the considerable saving of energy resources and the costs that go with it. I remain vehemently in favour of the kind of arrangement we have and I hope that carries the view of the House. I am grateful to Mr Belleré and to those associated with him on the production of a very good report.

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

Pan-European transport policy
President
The next item is the report (A4-0334/96) by Mr Lüttge, on behalf of the Committee on Transport and Tourism, on the pan-European transport policy.

Lüttge
Mr President, now that morning is almost upon us and honourable Members from nine different countries have given us their detailed opinions on summertime, we have only a few minutes left before midnight if - as I assume - we are going to keep to our time, just a few minutes in which to discuss and debate a subject like pan-European transport policy. Georg Jarzembowski, Petrus Cornelissen, a few others and even Commissioner Kinnock - if we take the overall view, transport policy is the basis of everything we are discussing here. Because the report was initially listed as the last one on the agenda, I said, look, let's at least get as far as completing the draft of the poster for the conference, on the assumption that honourable Members will agree tomorrow to hold the conference in Helsinki on the date proposed. Commissioner, the draft is ready - Georg Jarzembowski - and as usual red is the dominant colour and the basis of this whole debate.
(Heckling from Mr Jarzembowski) Well, he must be colour-blind. It's blue, not black! Ladies and gentlemen, although time is short, I would like to remind you that it was this European Parliament which - because there was no pan-European transport policy at that time - crucially influenced the debate in the late 1980s. The impetus for the pan-European conferences came from this Parliament, and I have no reservations in admitting, once again, that we received vital support from the Commission; the Commissioner at that time was Mr van Miert. I am pleased to put it on record, Commissioner Kinnock, that this tradition of cooperation and support - because this is a common concern - was continued by you immediately after you entered office. The same can be said of your staff - Ottokar Hahn and Dino Stasinopolis, to name but two. They played a critical part, too, at least as far as Mr Hahn is concerned - now that he is gone we can say that - and the same tradition is being carried on by others.
I recall that we held the conferences in Prague and in Crete, and it can certainly be said today that we still have something of a deficit to make up in terms of achieving what we wanted to achieve. Overall, though, contrary to expectation, the consequences and results of those conferences have been far more good than bad. Even the very generalized declaration of Prague, dating from 1991, formed the basis for the further development of European transport policy as a whole, partly in conjunction with the regional conferences and sectoral conferences which have taken place in ever-increasing numbers.
A very important contribution has also been made by our Steering Committee. This is a unique institution, bringing together representatives of the European Parliament, the Commission, the Council of Ministers and other organizations relevant to the further development of a pan-European transport policy - for example, the Council of Transport Ministers, the United Nations Economic Commission, the Economic and Social Committee and the Civil Aviation Authority. We have even involved industry - and this is a new departure - in the preparations for the Helsinki conference. At that conference, too, industry will for the first time play a very important part, because we believe that it is one of the protagonists. In May 1997 there is to be a big transport exhibition in Helsinki, which is thematically linked to the third pan-European Transport Conference to be held in that city's Finlandia Hall in June next year.
As far as the agenda is concerned, it was actually clear to us from the start, when we began the preparatory work, that we would have to go into greater detail in order to achieve more concrete results, and that is reflected in the agenda. At all events, the public, the persons concerned, and indeed people throughout Europe expect more specific statements about the financing of future infrastructure projects, about the intelligent use of transport systems, about transport safety - let me remind you of the situation at the borders, which has not been satisfactorily resolved, and of the various cases of fraud that have taken place in cross-border transport. We are expecting about 800 to 1000 people to attend - politicians, experts and representatives from over 50 countries, from the entire continent of Europe including the Mediterranean area, from North African countries, from the Near and Middle East, from states with observer status and the world's industrialized nations - all of whom have approached us about the possibility of participating.
This conference is to conclude with a Helsinki Declaration, which will go into greater detail and provide a genuine basis for future work on the pan-European transport policy. This Helsinki Declaration is not intended to be in the nature of a charter but - in the same way as the previous Prague and Crete declarations - to provide a basis through a voluntary commitment. We have had good experience of this. Finally, I ask: are we on the right course? I say yes, and I believe that other honourable Members will share that view. But, in the development of the panEuropean transport policy, with the assistance of all those who are willing and able to cooperate, there still remains a great deal to be done.

Jarzembowski
Mr President, first of all I should like to thank my colleague Günter Lüttge most sincerely for the dedication which he, together with the Commission and the rest of us on the Steering Committee, have devoted to the preparation of the third pan-European Transport Conference. I should remind the House that we will be continuing our discussions in Helsinki, and there are two things we hope to establish in the form of agreements. First, the principles of the pan-European transport policy, such as the social market economy and fair competition as organizational principles of transport policy, but, Günther, and Commissioner Kinnock, we also need to review what progress we have made in implementing the results of Prague and Crete, because there is no point in constantly adopting more and more resolutions if nobody implements them. That will be an essential focal point.
The second point is this: we will have to examine the continuation of the trans-European transport corridors out of the European Union and into the non-Union countries of western Europe - and beyond, for example into the former Yugoslavia, into Russia and into the other CIS successor states. In order for these conferences and the resulting recommendations to be successful, we must once again be sure that, at the third pan-European Transport Conference as at the first two, we enjoy the benefits of close cooperation - close collaboration between the Commission, Parliament, the national transport ministers and the transport ministers of the non-European States.
This is where I see the only real problem arising - Günther, we must talk about this frankly. I believe that the panEuropean Transport Conference should be used as an opportunity for an exchange of opinions between those who hold political responsibility, as members of parliaments and governments, on the one hand and representatives of industrial, transport and environmental associations on the other, to promote better mutual understanding. However, we do reject the demand by the Socialist Group, which was also rejected in committee, that the representatives of the association concerned - environmental, economic or whatever - should be officially invited to attend the conference.
Commissioner, I hope you will take the same line on this, because it is no use at all to us if this Transport Conference of decision-takers from the Commission and Parliament, transport ministers - and we're very happy to welcome a few from the UN, as well - and ministers with direct or indirect political responsibility is allowed to degenerate into a technical seminar by inviting every conceivable kind of lobbyist and interest group to attend the conference. In all seriousness, Commissioner Kinnock, please think again about this! We Christian Democrats want this Transport Conference to be a success, which is why we want it to be a conference for decision-takers, not a technical conference.

Wijsenbeek
Mr President, I welcome this opportunity to debate the third pan-European conference on transport. I was involved in the beginning of the preparatory work group. Then our erstwhile colleague Mr Pelttari took over as the conference was to take place in Finland. He remained active, but unfortunately he had to leave us again after the elections. So I am speaking now on behalf of my group.
The first and second conferences were so successful that we now see ourselves forced to continue ad infinitum this project led by our colleague Mr Lüttge, with not inconsiderable Community finance.
Any critical or parsimonious person would have to call a halt to it! Anyone who believes in the future expansion towards countries of central and eastern Europe, who wants progress to be made in the introduction of the acquis communautaire in those countries, who values the expansion of intermodal objectives which we in the European Parliament as a whole want to see implemented, must welcome it!
We must, however, beware of making the same old mistakes. We must not merely talk about money, as we did in Prague, essential as that is for the former eastern bloc. We must not act as if we had a monopoly on wisdom and dictate to the CCEEs in matters of the environment, which even we have not managed properly, but we can help them in the right direction as they are starting from scratch.
Let us hope that a useful exchange of views can take place and that these conferences do not become an interminable repetitive obligation but only occur when there is something worthwhile to discuss.

Cornelissen
Mr President, I would like first of all to congratulate Mr Lüttge and also thank him for his work on the preparation for the third pan-European transport conference in Helsinki. I am sure it will not have escaped his attention that on the German text of the Helsinki poster it was not the red but the blue part that was highlighted. I welcome the opportunity at this conference of examining the action taken on the agreements reached in 1994 in Crete.
I also think it important to consult with the countries of central and eastern Europe on the desired European transport policy for the coming years. If such a policy is to be successful it must be supported by as many countries as possible, not just in the European Union but also in central and eastern Europe.
I should like to draw your attention to two points. First of all we are continually increasing our demands - and quite rightly so - on transport in terms of energy consumption, environmental pollution and road safety. I think it essential that these demands should also apply to vehicles from non-EU countries which use our roads. Our environment is entitled to that and road safety demands it. I think our road hauliers are also entitled to it from the point of view of fair competition. Does the Commissioner share this view and how does he envisage it could be put into practice and by what means?
My second point concerns the serious obstacles and delays facing road traffic at the border between the European Union and Poland, for example, and at the borders between countries in eastern Europe. Recent weeks have also seen the nonsense at the Russian border. I read an article in a Dutch newspaper with the headlines 'Off to Belarus at 75 metres per hour' . I think that what is currently happening there, Mr President, especially in view of the widespread cowboy tactics being used to extort money from drivers, is completely intolerable. Is the Commissioner prepared to discuss this untenable situation in the Commission and to raise it specifically in contacts between the Commission and the various governments and authorities in eastern Europe and to come back and inform us of the outcome? We cannot go to Helsinki if there is not a considerable improvement in those matters.

Kinnock, Neil
Mr President, I would like to begin by congratulating Mr Lüttge for his excellent report, initiating formal preparations for the Third Pan-European Transport Conference. The Commission has from the beginning fully supported this initiative jointly with Parliament in every practical way. The Economic and Social Committee, the Economic Commission for Europe and the European Conference of Ministers of Transport are, together with Parliament and the Commission, members of the Steering Committee. My staff are already hard at work with those of Parliament and in close cooperation with the host country, Finland, to ensure satisfactory organizational arrangements. I have to say too that there is widespread interest in the approach to the conference and in the substance of the conference itself. I was yesterday in Russia in the company of Ottokar Hahn who has been mentioned in the debate, I have to say that Ottokar is so busy in a variety of developments that it is true to say he has wider coverage in Russia than does snow. His work is very constructive and he, together with the Russians, are making a variety of preparations to ensure their effective participation in the conference.
Amongst the issues which they are concerned with is one just mentioned by Mr Cornelissen and that is the question of border hold-ups over a huge number of border crossings between the Union and other parts of Europe and beyond. I think it would be fitting if that subject was to receive very strong attention in the appropriate parts of the agenda in Helsinki.
On the substance of the conference a programme has, as suggested in the report, been drawn up focusing on three key areas: the stock-taking of developments in transport policy since the Greek conference of 1994, financing of transport infrastructure and thirdly the intelligent use of transport systems. The exact coverage of the debate in each area still obviously needs to be agreed but I am confident that we can ensure that environmental and safety issues will be satisfactorily addressed.
We will also be able to discuss how to ensure improved modal split as well as the implications of intermodal transport of dangerous goods. All matters which rightly are at the front of the concern of Parliament.
The Third Pan-European Conference will, as Mr Lüttge correctly pointed out, provide representatives from the European transport industry with a particular opportunity to put forward not only their ideas in a variety of areas but also their products because they will have the opportunity to exhibit them. I believe that this will in a variety of ways enrich the conference as will the participation of a number of organizations that are not strictly governmental or industrial but certainly have experience and well-authenticated views to put in the context of a conference like the one that will be held in Helsinki.
As in the past, we felt in the Commission, and indeed this is a view shared by this House, that the most appropriate result for the conference would be the adoption by all participants of a non-binding political declaration. That should set out broad principles for the conduct of transport policy without of course committing the European Union, its Member States or institutions to specific legislative action or to negotiations on international agreements. If the Union wishes to act to implement any part of the declaration, that will have to be done in accordance with the appropriate Union procedures.
The second conference held in Crete in March of 1994 endorsed, as the House will know, nine intermodal transport corridors as a basis for further work on infrastructure development. Since then work on the nine corridors has been pursued in the G24 Transport Group as well as in workshops on specific corridors. My staff have recently begun consultations at expert level with all of the participating countries, the relevant international organizations and the international financial institutions in order to review the work done so far and to report to the conference. That report will summarize the work undertaken on the different corridors; it will assess the need for any adjustment to the corridors; it will suggest issues to be addressed in further work on corridor development such as multimodality or the intelligent use of infrastructure. The work will continue after the conference and Community institutions will be involved in accordance with our internal procedures.
In concluding, I would like to stress the importance that the Commission attaches to the success of the conference. I hope that the debate and the proceedings of that conference will provide a new impetus towards the further development of transport systems, clearly a matter of vital importance for European integration and economic and social development. I am grateful to you, Mr President, and indeed to those who have stayed to this late hour such as the interpreters, we could not do without them. I regret the passage past midnight but their work is all the more valuable.

Cornelissen
Mr President, I would like to thank the Commissioner for his promise that the problems at the borders in eastern Europe will be an important item at Helsinki. But that is not enough for me. That will take another six months. What I want is for the Commission to discuss it and take it up in all contacts between the Commission and the governments of eastern Europe. This kind of nonsense means that the public in our countries is becoming less willing to keep on pumping millions by way of financial support to eastern Europe.

Kinnock, Neil
Mr President, I am grateful to Mr Cornelissen for raising the point, I only failed to mention it earlier because of a desire to save time. There is no occasion in Council or in contacts with Member States, or other States in Eastern and Central Europe and beyond, where we fail to mention the awful problems encountered by those wishing to pass international borders. Those problems are in some respects intensifying. They figured very substantially in the discussions I had with the Russians over the last two days. Mr Cornelissen can be confident that not only do we take opportunities to raise and press the issue, we actually make a lot of opportunities as well.

President
Thank you, Mr Kinnock.
The debate is closed.
The vote will take place tomorrow at 11 a.m.
I would like to thank everyone for their cheerful company and cooperation in making Parliament's work run smoothly. I would also, ladies and gentlemen, on behalf of all of you, like to extend special thanks to this Chamber's services, which have been most cooperative, and, as the Commissioner has already begun doing, to the interpreters who have had a long day of intense work and whom we have 'rewarded' with 10 extra minutes. I therefore not only express my thanks but ask your forgiveness since this Presidency has not been firm enough when measuring the times allotted for speaking.
(The sitting was closed at 12.10 a.m.)

