Download - The European Union - A Critical Guide

The European UnionA Critical Guide

New and updated edition

Steven P. McGiffen

Pluto P PressLONDON • ANN ARBOR, MI

McGiffen 00 pre iiiMcGiffen 00 pre iii 30/8/05 09:44:3030/8/05 09:44:30

First published 2001Second edition published 2005 by Pluto Press345 Archway Road, London N6 5AAand 839 Greene Street, Ann Arbor, MI 48106

www.plutobooks.com

Copyright © Steven P. McGiffen 2001, 2005

The right of Steven P. McGiffen to be identifi ed as the author of this work has been asserted by him in accordance with the Copyright, Designs and Patents Act 1988.

British Library Cataloguing in Publication DataA catalogue record for this book is available from the British Library

ISBN 0 7453 2506 8 paperback

Library of Congress Cataloging in Publication Data applied for

10 9 8 7 6 5 4 3 2 1

Designed and produced for Pluto Press byChase Publishing Services Ltd, Fortescue, Sidmouth, EX10 9QG, EnglandTypeset from disk by Stanford DTP Services, Northampton, EnglandPrinted and bound in the European Union byAntony Rowe Ltd, Chippenham and Eastbourne, England

McGiffen 00 pre ivMcGiffen 00 pre iv 30/8/05 09:44:3030/8/05 09:44:30

Contents

The European Union: An Uncritical Guide to the Abbreviations and Acronyms viii

Preface xiii

1 Introduction 1

2 The Treaties 4 The Treaty of Rome – The Single European Act –

Maastricht – Amsterdam – Nice

3 The Institutions 14 The European Council – The Council of Ministers

– The Council Presidency – COREPER (The Committee of Permanent Representatives) – The Convention and Intergovernmental Conferences (IGCs) – The Commission – The European Parliament – The European Court of Justice (ECJ) – The European Court of Auditors – The Economic and Social Committee (ECOSOC) – The Committee of the Regions

4 How the European Union Makes Law 32 Different sorts of law – Unanimity v. Qualifi ed Majority

Voting (QMV) – The legislative procedures: consultation, cooperation, co-decision and assent – The budget and budgetary procedure – Monitoring expenditure

5 Enlargement 43 Background and history – Problems – The mass

accession of May 2004 – Possible further accessions

6 The Common Foreign and Security Policy 51 Background and history – The Second Pillar –

From Yugoslavia to Amsterdam – Common defence or militarisation? – How the CFSP works –The Nice Treaty’s reforms and developments since – Common (market) values?

McGiffen 00 pre vMcGiffen 00 pre v 30/8/05 09:44:3030/8/05 09:44:30

vi The European Union

7 Citizenship, Justice and Security 57 A controversial policy area – What is EU citizenship? –

The Amsterdam Treaty – The Third Pillar – The Charter of Fundamental Rights – Citizenship, Justice and Home Affairs – Europol – Refugees and asylum – After 9/11

8 Monetary Policy 68 Arguments for and against a single currency – The

Convergence Criteria and Growth and Stability Pact – The Euro

9 The Internal Market 76 The long arm of the Internal Market – Vital regulation

or barrier to trade? – Competition policy – The Single European Act – Widows, orphans and jobs (Does the internal market mean a ‘race to the bottom’ in social and environmental policy?) – The four freedoms (Goods, services, capital and labour), some freer than others – Capital – Private Good, Public Bad (How the EU undermines public ownership) – Mixed blessings of a big market – Services – Plans – Consumer protection

10 External Economic Relations 92 Imports – Exports – Globalisation – Development

11 Employment and Social Policy 99 Background and history – The question of competence

– Competing theories of what causes unemployment – Recent developments in employment policy – The European Employment Strategy – The Lisbon Strategy – Health and safety at work – Informing and Consulting Workers – Gender equality – Disability and ageing – Education and training – Socrates, Leonardo, and Youth for Europe – The European Social Fund (ESF)

12 The Environment and Public Health 119 Background and History – Programmes, policies and

problems – Kyoto – GMOs – REACH (A new framework for control of chemicals) – Public Health – Food Safety

13 The Common Agricultural Policy and Common Fisheries Policy 132

The CAP: background, history and aims – How it works – The reform of 2003 – Criticisms

McGiffen 00 pre viMcGiffen 00 pre vi 30/8/05 09:44:3130/8/05 09:44:31

Contents vii

The CFP: background, history and aims – The reform of 2002 – Regional Advisory Councils – Criticisms

14 Transport 141 The Common Transport Policy and its limitations –

The 2001 White Paper – Trans-European Networks (TENs) – Marco Polo and Galileo

15 Regional Policy 149 Background and history – Agenda 2000 – Impact of

enlargement – The European Regional Development Fund and other Structural Funds – The Cohesion Fund – The Community Instruments – The future

16 Industrial Policy and Energy 155 Background, history and aims – Recent developments

in industrial and related policies – Energy policy – Technology, Research and Development – The Sixth Framework Programme

17 The Rejection of the Constitutional Treaty: What next for the European Union? 162

The Giscard text: Institutional reform – Foreign and defence policy (The militarisation of the EU) – Citizenship and citizens’ rights – Federalism and subsidiarity – Fiscal, fi nancial and economic policy – Why was no agreement initially reached? – The immediate future – The revised text: The Commission – The Council – The Parliament – The Euro – Economic and employment policies – Stability and Growth Pact – Multiannual Financial Framework – Charter of Fundamental Rights – Eurojust – Enhanced Cooperation – Economic, Social and Territorial Cohesion – Energy – Declarations and Protocols relating to individual member States – The Future

18 Conclusion 179 A summary of the criticisms 180

Notes 188Recommended Reading 201Index 211

McGiffen 00 pre viiMcGiffen 00 pre vii 30/8/05 09:44:3130/8/05 09:44:31

The European Union: An Uncritical Guide to the Abbreviations and Acronyms

ACP Trade co-operation body comprising EU and developing countries (the initials stand for ‘Africa, Caribbean, Pacifi c’)

ALDE Alliance of Liberals and Democrats for Europe (Liberal Group in European Parliament, previously ELDR)

ASEAN Association of South East Asian NationsASP Agreement on Social PolicyBSE Bovine Spongiform Encephalopathy (‘Mad Cow

Disease’) CAP Common Agricultural PolicyCCT Common Customs TariffCDM Clean Development Mechanism (a Kyoto Protocol

instrument)CEE Central and Eastern EuropeCEEP EU-wide small businesses’ groupCFCA Community Fisheries Control AgencyCFP Common Fisheries PolicyCFSP Common Foreign and Security PolicyCI Community InstrumentCMO Common Market Organisation (under the CAP)Comenius Programme encouraging transnational co-operation

between schools COR Committee of the RegionsCOREPER Committee of Member States’ Permanent

RepresentativesCP Common Position (i.e. adopted by Council)CPs Community programmesCTP Common Transport PolicyDG Directorate-General (a division of the Commission)EAGGF European Agricultural Guidance and Guarantee

FundEAP Environmental Action ProgrammeEASA European Aviation Safety AgencyEC European Community

viii

McGiffen 00 pre viiiMcGiffen 00 pre viii 30/8/05 09:44:3130/8/05 09:44:31

ECB European Central BankECHR European Convention on Human RightsECJ European Court of JusticeEcofi n Economic and Finance CouncilECOSOC Economic and Social Committee (also known as

ESC)ECSC European Coal and Steel CommunityECU European Currency UnitEEA European Economic AreaEEB European Environmental BureauEEC European Economic CommunityEES European Employment StrategyEFSA European Food Safety AgencyEFTA European Free Trade AreaEIA Environmental Impact AssessmentEIB European Investment BankEIF European Investment FundEMI European Monetary InstituteEMS European Monetary SystemEMU European Monetary UnionEP European ParliamentEPP-ED European People’s Party: the centre-right Group in

the EPEqual Community Instrument to encourage equal

opportunitiesERA European Research AreaErasmus Programme encouraging transnational co-operation

between universities and mobility of university students

ERDF European Regional Development FundESC Economic and Social Committee (also known as

ECOSOC)ESCB European System of Central BanksESF European Social FundETUC European Trade Union ConfederationETUI European Trade Union InstituteEU European UnionEuratom European Atomic Energy CommunityEures European Employment ServiceEurojust EU co-operation system for legal affairsEuropol EU police force

Abbreviations and Acronyms ix

McGiffen 00 pre ixMcGiffen 00 pre ix 30/8/05 09:44:3130/8/05 09:44:31

x The European Union

EWC European Works CouncilFIFG Financial Instrument for Fisheries GuidanceGalileo EU-funded satellite navigation systemGATS General Agreement on Trade in ServicesGATT General Agreement on Tariffs and TradeGDP Gross Domestic ProductGM Genetically Modifi edGMOs Genetically Modifi ed OrganismsGNP Gross National ProductGPS Global Positioning SystemGreens/EFA Greens-European Free Alliance political Group in

European ParliamentGrundtvig Programme encouraging the European dimension

of life-long learningGSP Generalised System of Preferences (under external

trade rules)GUE/NGL Left Group in the EPHelios EU-funded network for disabled people, now

defunctHorizon Community Instrument to address unemployment,

now defunctICT Information and Communication Technology ID Independence and Democracy, political Group in

European ParliamentIGC Intergovernmental ConferenceILO International Labour OrganisationIMF International Monetary FundInter-reg III Community Instrument for border regionsIT Information TechnologyJHA Justice and Home AffairsJI Joint Initiative – Kyoto Protocol instrumentJRC (EU) Joint Research CouncilLeader Community Instrument for poorer regionsLeonardo EU training and education programmeLIFE EU fund to support nature conservation projectsLingua EU language education programmeMAGP Multiannual Guidance Programme (under CFP)Marco Polo EU initiative to encourage movement of freight by

rail rather than roadMDGs Millennium Development GoalsMEP Member of the European Parliament

McGiffen 00 pre xMcGiffen 00 pre x 30/8/05 09:44:3130/8/05 09:44:31

Mercosur Latin American economic communityMinerva Programme encouraging open and distance

learning, information and communication technologies in education

MNCs Multinational CorporationsMTR Mid-Term ReviewNAFTA North American Free Trade AreaNATO North Atlantic Treaty OrganisationNGO Non-Governmental OrganisationNHS National Health ServiceNI Non-inscrit: independent Member of EPNOW New Opportunities for Women – an employment

initiative, now defunctOECD Organisation for Economic Co-operation and

DevelopmentPDB Preliminary Draft BudgetPES Party of European Socialists: centre-left group in the

EPPHARE Development programme for CEE applicant

countriesPSC Political and Security Committee QMV Qualifi ed Majority VotingR&D Research and DevelopmentRACs Regional Advisory Councils (of Common Fisheries

Policy)REACH Registration, Evaluation and Authorisation of

ChemicalsSAFE Safety Actions for Europe – small fund to support

SMEs making health and safety improvementsSAP Structural Adjustment ProgrammeSAPARD Rural development fund for CEE applicant countriesSEA Single European ActSEM Single European MarketSES Single European SkySIS Schengen Information SystemSMEs Small and Medium-Sized EnterprisesSMUs alternative term – ‘U’ is for UndertakingsSocrates EU education programmeTAC Total Allowable Catch (under the CFP)TDI A ragbag Group in the EP including fascists and

others

Abbreviations and Acronyms xi

McGiffen 00 pre xiMcGiffen 00 pre xi 30/8/05 09:44:3130/8/05 09:44:31

xii The European Union

TENs Trans-European NetworksTEU Treaty on European Union – the ‘Maastricht Treaty’third country Any country which is not a member of the EU,

usually used in the context of international agreements and treaties

UEN Group of the Union for a Europe of NationsUKIP United Kingdom Independence PartyUNCTAD United Nations Council for Trade and DevelopmentUNFCC United Nations Framework Convention on Climate

ChangeUNHCR United Nations High Commission for RefugeessUNICE EU-wide employers’ groupUrban Community Instrument for urban regionsVAT Value Added taxVDU Visual Display UnitVIS Visa Information SystemWEU Western European UnionWTO World Trade OrganisationWWF World Wide Fund for Nature

McGiffen 00 pre xiiMcGiffen 00 pre xii 30/8/05 09:44:3130/8/05 09:44:31

PrefaceThe European Union:

Books, Websites and Propaganda

At the back of this book you will fi nd a list of recommended books, papers and websites which I hope you will fi nd comprehensive and useful. It is fully updated from the list included in the First Edition, covering the wide range of developments which occurred between 2001 and 2005. The inclusion of so long a bibliography might well beg the question as to whether, if so much is already available, and written on such a wide range of EU-related subjects from so many points of view, the world really needs yet another book on the Union and its ways. After all, the material listed varies from general guides to Euro-federalist tracts, and from specialised scholarly treatises to diatribes against ‘Brussels’ and all its works.

Despite this wealth of literature, however, gaps remain, and in many ways these have, if anything, widened since 2001. It is the aim of this book to fi ll the biggest and most glaring of these. The fact is that whilst people who already have some knowledge of the Union can easily fi nd well-written books on particular subjects which come from a range of points of view, those students seeking to get to grips with what at fi rst sight seems a dauntingly complex subject have no such choice. Almost every available book which describes, for the general reader or beginning student, the basic procedures by which the European Union is governed, is written from within a narrow range of viewpoints. Each either celebrates or accepts as an immutable fact the current Union and its systems of governance and economic relations.

This does not mean that they are invariably propagandistic tracts or that they do not, in some cases, offer useful guides to their subject. On the contrary, books such as John Pinder’s The European Union: A Very Short Introduction, Timothy Bainbridge’s The Penguin Guide to the European Union and Alex Warleigh’s European Union: The Basics will each give you the information you need to make sense of the EU. None, however, gives a thorough account of the range of criticisms of the Union found across Europe. A little more thorough, and probably

xiii

McGiffen 00 pre xiiiMcGiffen 00 pre xiii 30/8/05 09:44:3130/8/05 09:44:31

xiv The European Union

the best single volume on the EU from an integrationist perspective, is Dick Leonard’s The Economist Guide to the European Union.

On the other hand, critical works rarely give much help to those seeking a basic introduction. The Institute of Directors publication, Roney and Budd’s The European Union: A Guide Through the EU/EC Maze and the EC/EU Fact Book, by Alex Roney were exceptions but are now somewhat out of date. Another is the on-line Euroknow encyclopaedia, which rivals a book like Rodney Leach’s Europe: A Concise Encyclopaedia and even manages to be amusing. These, however, are guides of a rather different kind to the one I set out to write. They are reference works more than critical essays. In The European Union: A Critical Guide, I have attempted to combine the two, giving as straightforward an account as possible of the sometimes labyrinthine bureaucracy, the treaties and the economic imperatives by which the Union is governed, before tackling questions such as the dilution of democracy or the infl uence of big corporations.

It is generally recognised that support for the European Union and its integrationist agenda comes from across the political spectrum. Some on the left have seen the EU as offering the potential, even if inadvertently, for generating closer and more effective cooperation between the labour movement or radical forces in different member states; others, left as well as right, argue that the Union has the potential to act as a counterweight to the overwhelming power of the United States. Greens, at least outside the UK, Ireland and Scandinavia, have been overwhelmingly positive, extrapolating from the self-evident fact that many environmental problems demand an international solution, to an enthusiasm for a European federation. On the right, on the other hand, the EC/EU has garnered support on the basis of the Treaty of Rome’s absolute commitment to a market economy, the clear advantages for corporate business to be found in the removal of barriers to trade across a huge ‘internal’ market, and the fact that each step of integration has made the sorts of policies traditionally favoured by governments to the left of centre diffi cult if not actually illegal.

Opposition to the EU also comes from many sources. This fact is, however, at least in the UK and, in my experience, North America, far less known. In the English-speaking world the so-called ‘Eurosceptic’ or ‘anti-European’ position has been pigeon-holed as an atavistic right-wing set of beliefs which have grown in the main from a failure to accept the realities of the late twentieth, early twenty-fi rst century world, of globalisation and the irrelevance of the nation state to

McGiffen 00 pre xivMcGiffen 00 pre xiv 30/8/05 09:44:3130/8/05 09:44:31

modern power politics. As the details of the proposed Constitutional Treaty emerged in referendum campaigns and general debate, this did begin to change, for many found it diffi cult to understand why anyone to the left of centre should support a ‘Constitution’ which would institutionalise free market capitalism, oblige member states to spend an ever-increasing proportion of their budgets on ‘defence’, and, as I explain in my fi nal chapter, contains a host of provisions traditionally anathema to even the mildest social democrat.

In the view of politics which left critics of the European Union are obliged to confront, you have, on the one side, forward-looking, internationally-minded, dynamic, go-ahead (and so on) leaders who have a ‘vision of Europe’ and wish to avoid any possibility of the return of the sort of national rivalry which led to enmity, leading in turn to several large wars in the nineteenth century and two huge ones in the twentieth. On the other we have the sort of people who wear Union Jack waistcoats and are concerned to defend every Englishman’s god-given right to watch dogs tearing up small furry animals, to eat crisps containing fl avourings considered poisonous elsewhere in the world, and to have a public transport system which would be the envy of remoter regions of Burma. Elsewhere in Europe, there is no opposition whatsoever, except in Scandinavia, which is supposed to be a bit odd anyway and where, no doubt, there are people who wear waistcoats displaying the Swedish or Danish fl ag, and insist on their right to chew tobacco and do other, non-internationally-minded things which have no place in the globalised economy.

One of the aims of this book is to dispel this myth, which has been created by pro-EU propagandists but, it has to be said, eagerly embraced by the sort of Eurosceptic it describes, a type which does, unfortunately, exist. In my dealings with the anti-EU movement I have met young Danes who were convinced that the European Union was simply a sort of Soviet Union#2, and one who, despite what appeared to be extreme poverty, travelled to Brussels from Copenhagen by train rather than the cheaper bus because the bus company was called Eurolines and he refused to use it – though it is just possible that he was joking. And I have heard the EU blamed for such phenomena as the pitiful level of pensions in the UK, over-lenient treatment of child molesters, and global warming.

On the other hand, I have met elected British politicians who express breathless enthusiasm for ‘Europe’ only because it is fashionable to do so, yet know nothing whatsoever about what the EU can and cannot

Preface xv

McGiffen 00 pre xvMcGiffen 00 pre xv 30/8/05 09:44:3130/8/05 09:44:31

xvi The European Union

do and can speak not a word of any language other than what now passes for English in parliamentary circles. I have met politicians and journalists from across Europe who understand very little about the relationship between the EU and its member states. Ignorance of the EU is not confi ned to those who oppose or criticise it.

The subtext of much of what is written on the subject, and of absolutely all offi cial material issued by the European Commission or the European Parliament, is that criticism is not a useful activity. We may criticise its policy, but not the thing itself. Thus, much of the material listed in my bibliography sets out not to discuss whether the current or proposed arrangements offer the best, or even a workable, solution to the problems facing the 25 member states and their peoples. It merely describes what is, and if it criticises at all it does so from the point of view which I have called integrationism – more often, though misleadingly, referred to as federalism – a belief that integration has not gone nearly far enough, that it is stalled by narrow national self-interest, that it is, or will be, the Future. This does not mean it is worthless: on the contrary, much of this material is meticulously researched and clearly written, if a bit short on humour. It should not, however, be taken at face value. These people have a clear political agenda, as clear as that of the anti-EU movement, and their books should be read with this in mind.

As well as ‘guides’ to the EU, academic studies of the Union or aspects of it are common, though again, those which take an anti-integrationist line or draw conclusions which call the basic tenets of the Treaty of Rome into question are few. To fi nd intelligent criticism it is better to look at studies of particular policies or policy areas or developments, both academic and those written for a wider audience. Swedish Green Euro-MP Per Gahrton provided the best analysis of the Amsterdam Treaty from an oppositional viewpoint with his The New EU After Amsterdam. Gahrton is good on the Common Foreign and Security Policy, while his fellow Swede Jonas Sjöstedt’s The new EU Constitution: Centralised Rule and Market Liberalism is a good guide not only to the proposal to which its title refers but to the whole direction of EU thinking.

Critical studies of the EU’s institutions are hard to fi nd, though few writers who delve very far into the working of the Commission, Parliament, Council and Court of Justice offer unqualifi ed praise. The best of these studies are Elizabeth Bomberg and Alexander Stubb’s The European Union: How Does It Work?, and Clive Archer’s The European Union: Structure and Process.

McGiffen 00 pre xviMcGiffen 00 pre xvi 30/8/05 09:44:3130/8/05 09:44:31

There are several well-researched and well-organised guides to EU law, the most up-to-date of which is written by Paul Craig and Grainne de Burca and called simply EU Law. For those who require more detail, A.G. Toth’s Encyclopaedic Dictionary of European Community Law seems, at least to someone like myself who is not a legal specialist, to defy the odds and live up to its name.

The standard textbook on the economics of the European Union and its integrationist project is Dennis Swann’s The Economics of Europe, a regularly updated publication though at the time of writing there had been no new edition since the ninth, issued in 2000.

As I have many criticisms to make of the European Union institutions in the pages to come, I am pleased to be able, so near the beginning of my book, to offer a word of praise. Ten years ago on-line information services offered by the institutions were poor, even by the standards of the mid 1990s. They were slow in improving, though signs that they were beginning to do so were already evident when I wrote the fi rst edition of this book. I can now say without reservations that those of the Parliament and Commission are excellent, as is the Eur-Lex site which offers a comprehensive guide to laws in force and measures proposed. If you wish to read the actual text of any measure or proposal referred to in these pages, you should have no trouble at all in fi nding it, while a constant stream of information sheets, press releases and background documents allows anyone with access to the Internet to keep up to date with Commission thinking and the positions adopted by the various political tendencies represented in the Parliament.

At the end of the book, I have tried to give a concise but reasonably representative bibliography for each chapter. It is surprising that, although detailed academic studies abound, there is so little available for the general reader on so many vital areas of EU policy. Of course, the nature of the Internet, its constant rapid growth, and even the volume of conventional literature which appears each year mean that these gaps are gradually being fi lled. This book attempts to give an idea of the range of possible criticism, to question the EU at a more fundamental level than is usually seen, and thus to contribute directly to this fl ow of information.

Preface xvii

McGiffen 00 pre xviiMcGiffen 00 pre xvii 30/8/05 09:44:3230/8/05 09:44:32

1Introduction

In 1957 six countries of western Europe signed a treaty designed to further the transformation of the economic and political life of the region. The act of signing itself demonstrated that much had changed in the twelve years since the end of World War Two. In 1945, most of western Europe had been in ruins.

Though the aims of the Treaty of Rome were always as much political as economic, it originally limited the Community’s powers to matters concerned with production and consumption. The Six jealously guarded their control of taxation, of the criminal law, of moral and cultural matters, of education. Their co-operation was, ostensibly at least, designed to pool economic resources and resourcefulness, not to dissolve western Europe into a single amorphous entity.

Whether the European Union descended from this original Community should be an economic tool or a fully-fl edged federation is now the tension at the heart of the continent’s politics. Important decisions are involved, and the future of every country in Europe will depend on their outcome. They are inherently diffi cult, but are made even more so for British people by the bizarre terms in which the debate is almost invariably conducted in UK political life and in the country’s media. Commonly used expressions such as ‘pro-European’, ‘anti-European’ and ‘Eurosceptic’ are deliberately misleading, and the equation of ‘Europe’ with the European Union both geographically and politically inaccurate. The rise of a right-wing party, containing some extremely unsavoury elements, and calling itself the United Kingdom Independence Party, has further muddied the already murky waters. Although ‘Europe’ occupies far more column inches in newspapers than it did even a few years ago, much comment on all sides of the debate is ill-informed about the basics of the system.

Accusations levelled against the BBC in January 2005 by an independent panel commissioned by the corporation’s governors, of ignorance, stereotyping and unintentional bias, and ‘a tendency to polarise and over-simplify issues, ... ignorance of the European Union on the part of some journalists and a failure to report issues

1

McGiffen 01 chap01 1McGiffen 01 chap01 1 30/8/05 09:44:4930/8/05 09:44:49

2 The European Union

that ought to be reported’ might have referred to almost any section of the British media. Only the clear public responsibilities of the state-funded institution made the allegations more telling than they might have been if levelled against the Guardian or the Daily Express. In response, BBC governors acknowledged that a recent opinion poll had shown that ‘the BBC is not succeeding in providing basic accessible information on the topic of Europe and (that) urgent action is needed’.1

Newspapers, unlike the BBC, are entitled to their opinions. Only the way that they express them might be criticised, especially when this takes the form of the deliberate spreading of confusion. To the pro-EU press, all critics of the Union are xenophobes, mired in a nostalgic past of warm beer and village cricket. To their opponents, foreigners are generally the subject of mirth or contempt, strange people with funny accents and loose morals.

It was gratifying to see both supporters and opponents of deeper European integration welcoming the group’s outspoken criticisms,2 for the truth is that neither side should believe that it is well-served by the current standard of coverage and debate. As an opponent of the Constitutional Treaty, I could only throw up my hands in despair when I read that whilst nine out of ten residents of the EU of voting age admitted to knowing nothing at all about the proposal’s contents, half would vote in its favour if they had the chance. Yet surely a supporter, if honest, would have the same reaction. Do the Europhiles really want a Union based on ignorant acquiescence, or can they too see how dangerous such a development would be?

The European Union is a political and economic project which a number of governments have decided to pursue. It is not an inevitable outcome of some mysterious March of History, nor is it a boat or train which must under no circumstances be missed. Politicians who abandon reasoned argument in favour of muddy metaphors (which, for some reason, almost always involve modes of transport) generally do so because they are lying. To be for or against the European Union, to favour its deepening into a full political union, its complete disbanding or something between the two, should have nothing at all to do with patriotism, nationalism or internationalism.

The EU is a proposed answer to the problems of Britain, Ireland and their neighbours on the European mainland. It is not the only available answer and it may not be the best, but it is quite possible to support or oppose it with the best of intentions. To fl y the twelve-star fl ag is not an act of treason, to refuse to do so no retreat into


Introduction 3

xenophobia. The EU exists, and the people of its member states must decide what they want to do about that fact. British voters, specifi cally, may soon decide whether to approve the proposed Constitution, as well as whether they wish to abandon their own currency and adopt the euro. In this book I shall attempt to provide the reader with the information he or she needs to be able to take part in these historic decisions.


2The Treaties

Before the mid 1980s, changes to the Treaty of Rome were relatively rare. Some amendments were necessary when new states joined, and two treaties were signed, coming into force in 1971 and 1977 respectively, dealing with budgetary matters.

It was in 1987, however, with the signing of the so-called Single European Act (SEA), that things began to move at such a pace that the Act can, in retrospect, be seen as the beginning of a transformation of the European Economic Community into the European Union. At fi rst sight, the SEA seems well in keeping with a notion of the EEC as ‘the Common Market’. The central thrust was a commitment by the member states to remove all remaining barriers to trade. ‘Barriers to trade’ can, however, be a very inclusive term, and the implications of a drive to remove them reached into every corner of economic life.

The SEA gave the member states until the last day of 1992 to achieve an ‘internal market’ within which the movement of goods, services, capital and labour would be unrestricted.

The Act did not, moreover, limit itself entirely to trade issues. It adopted also a series of institutional reforms aimed at improving co-operation between heads of state and government and attempted to take some steps towards achieving the important integrationist goal of a common foreign and defence policy. In addition, it extended Community competence into new fi elds which would become of huge importance in the following decade: social policy, environmental protection, and research and development.1

MAASTRICHT

Before 1992 the pretty Dutch border town of Maastricht was known mainly for its pleasant cafés and annual antiques fair. The signing of the Treaty on European Union on 7 February of that year changed all that, and the name ‘Maastricht’ became, overnight, synonymous with the fi rst really major overhaul of the Treaty of Rome.

Maastricht did four things which were of transforming signifi cance for the integrationist project. Firstly, like the Single European Act, it extended the competence of the Community’s institutions into new

4


The Treaties 5

areas. Secondly, it established new and far reaching objectives which were openly integrationist2 in character. Thirdly, it aimed to create a single currency, wrote a timetable for its introduction and set out the rules by which member states would qualify for admission and by which the currency would be governed. Finally, the Treaty created a wholly new structure within which the European Community would be one of three ‘pillars’ propping up the European Union, the other two being the Common Foreign and Security Policy (CFSP) and Justice and Home Affairs (JHA).

Of the three pillars, one, the European Community, is much more important as a support for the edifi ce of European Union than are the other two. The Community itself can be seen as constituting a number of different sets of institutions and practices.

The fi rst is an internal market without barriers to trade, a concept which includes, but is more far-reaching than, a simple customs union. In a customs union, independent nations agree not to put tariffs on each others’ goods. The internal market carries this further, however, following a rigorous logic which says that if one country cannot impose tariffs on imports from another, then it is entitled to ask whether those goods are produced and traded under conditions which ensure fair competition. Moreover, the internal market is more than a simple customs union in that it does not simply guarantee the free movement of goods, but what have been called the four freedoms: free movement of goods, capital, services and labour. Each of these ‘freedoms’ also carries with it far-reaching implications which compromise each member state’s ability to run its own affairs.

The Economic and Monetary Union (EMU) is the second major element of Maastricht’s revamped European Community. The Treaty contains not a vague, hopeful commitment to the eventual introduction of a single currency, but a detailed plan for a union of economies presided over by a common central bank.

The creation of Maastricht’s other two pillars was made necessary by the continuing struggle between integrationists and those who felt that the process of transfer of powers from national to supranational institutions had gone far enough. Both foreign policy and the criminal law, two of the major elements, respectively, of the second pillar, Common Foreign and Security Policy (CFSP) and the third, Justice and Home Affairs (JHA), are matters traditionally regarded as fundamental to sovereignty, or the right and ability of an independent state to govern its own affairs and those of the inhabitants of its territory. For this reason they were kept outside the normal supranational structures of the European Community.



As well as leaving us with an extremely complex structure, the tension between integrationists and their opponents was resolved in another way at Maastricht, by underlining a concept which had been around for some time in EC circles, but which had never before been institutionalised: ‘subsidiarity’. Though this is not always the case in practice, on paper subsidiarity is simple, implying that the EU’s centralised institutions can take action only where the objectives of such action could not be achieved at the national level. In addition, proposed measures are supposed to display ‘proportionality’, meaning that they must not be any stronger, more far-reaching or more expensive than is justifi ed by the seriousness of the problem they address.3

AMSTERDAM

Given its other attractions, Amsterdam is unlikely ever to see its name reduced to a shorthand label for a Treaty, despite that Treaty’s importance for the political direction of the European Union and its neighbours. Though Amsterdam did not introduce anything so obviously transforming as a currency union, it did take the European Union further down the road towards becoming, if not precisely a supranational state, something very much more than a set of institutions to facilitate co-operation between independent nations. In the offi cial view, the Amsterdam Treaty was an attempt to create an institutional structure, together with appropriate policy goals and the instruments to achieve them, capable of enabling the European Union to deal with a globalising economy, the threats of terrorism, international crime and drug traffi cking, and threats to the environment and public health. In a sense this was prescient, for these have indeed become the overriding themes of international politics in the years since Amsterdam. On the other hand, Patricia McKenna, who represented the Irish Greens in the European Parliament from 1999 to 2004, was also surely correct when she described the Treaty as ‘a further step towards Fortress Europe’ which signals ‘clear moves towards a militarised European Union’.4

NICE

The Treaty signed at Nice in December 2001 was supposed to deal with what were referred to as the Amsterdam ‘leftovers’: the weighting of votes under Qualifi ed Majority Voting (QMV) and how many would constitute an effective majority or a blocking minority; representation


The Treaties 7

in the European Parliament; the size and powers of the Commission; and the whole question of the EU’s institutions and the relationship amongst them and between each and the member states. In the event, a number of additional unresolved issues were on the Nice table: the Charter of Fundamental Rights, the question of allowing groups of countries to go further along the path of integration than the rest were prepared to do, and possible reinforcement of the Common Foreign and Security Policy.

Despite this intimidating agenda, Nice turned out to be much less sweeping in the changes it introduced to the structure of the Union than were the transforming agreements at Maastricht and Amsterdam. It was, however, even more confusing than either of those labyrinthine texts, with the governments of member states and applicant countries haggling for months afterwards about the exact meaning of various articles. Even the facts of the matter were a subject of dispute, whilst the questions of the weighting of votes at Council and the number of members of the European Parliament a country would have, and whether everyone would get a place on the Commission, were fudged.

There was, nevertheless, a sort of consensus regarding the political significance of the Treaty. Integrationists saw it as a botched agreement with a few saving graces; opponents and critics of the EU mirrored this, in general drawing attention to what they saw as certain dangerous features whilst conceding that it might have been worse. Some powers were transferred from national institutions to Brussels; QMV was extended to several new areas, but fewer than was hoped/feared; the weighting of votes was favourable to the big countries, but less so than it might have been; small countries kept their right to a Commissioner, but only for the time being.

Once again, a Treaty embodied the tension at the heart of a Union moving cautiously towards a form of integration about which many politicians across the spectrum harboured grave doubts and one which had extremely limited popular support. Nice was supposed to facilitate enlargement, but if it did so it was in a way clearly designed to benefi t multinational corporations and political elites at the cost of a further reduction in the power and infl uence of the peoples of the member states and their elected representatives.5

Maastricht, Amsterdam and Nice all dealt with a wide variety of policy areas including asylum and immigration, freedom of movement, citizenship, employment, social policy, discrimination, the environment and public health, consumer protection, open



government, and foreign policy, including defence. No one, however, on whatever side of the debate over Europe’s future, was satisfi ed with the ways in which they had done so. Their perceived inadequacies were what made it necessary, in the consensual view of mainstream politicians, to re-establish the Union on a clearer, fi rmer footing. Their attempts to do so would eventually result in the Constitutional Treaty proposed by the European Council in 2004. Whether that Treaty was up to the task was cast into serious doubt by its rejection by the electorates of France and the Netherlands in the spring of 2005, but its strengths and weaknesses will form the topic of a later chapter. For the moment, at least, the Union continues to be that devised at Maastricht, Amsterdam and Nice. The details of its structures and how well these have enabled it to carry out its policies and further its stated goals form the topic of the body of this book.

Box 2.1

Major Provisions of the Single European Act (1987)

• Added six new policy areas to European Community competence: single market, monetary co-operation, social policy, cohesion (i.e. between richer and poorer regions), research and development, environmental standards.

• Extended European Parliament’s powers: Council of Ministers could overrule EP veto in most policy areas pertaining to the single market only by a unanimous vote.

• Introduced qualifi ed majority voting (QMV) in the Council, ending the national veto in most areas pertaining to the single market.

• Gave formal standing to the European Council, by which the heads of state and government of the member states meet to discuss and determine policy.

• Declared that the single internal EC market would be completed by 31 December 1992 and all remaining barriers to intra-Community trade removed.

Box 2.2

Major Provisions of the Treaty on European Union (TEU) – the ‘Maastricht Treaty’, Signed December 1991

• Establishment of the European Union (EU) with a three-pillar structure:


The Treaties 9

1. The European Community (EC)2. Common Foreign and Security Policy (CFSP)3. Justice and Home Affairs co-operation (JHA).

CFSP and JHA are ‘intergovernmental’:

– they cannot be used as a basis for Directives and Regulations (EC laws)

– they are conducted by national governments through the Council of Ministers and the European Council

– they give no formal powers to the supranational institutions – the Commission, EP and European Court of Justice (ECJ).

• Establishment of a timetable and conditions for economic and monetary union (EMU), including a single currency.

• Establishment of European Union citizenship.• Further extension of EC competence: to education, culture, ‘Trans-

European networks’; extension of existing powers in environmental policy; industrial policy and R&D expanded.

• Agreement by eleven member states (excluding UK) on Social Chapter.• Further extension of powers of EP.• Establishment of Cohesion Fund.• ECJ given power to levy fi nes on member states.• Subsidiarity written into text of Treaty.• Introduction of a Common Foreign and Security Policy (CFSP, the Second

Pillar) with limited provision for QMV and a statement of intent to build a common defence.

• Introduction of powers related to Justice and Home Affairs (JHA, the Third Pillar) and dealing with such matters as asylum policy and policing.

Box 2.3

Major Provisions of the Amsterdam Treaty (1997)

Extension of Qualifi ed Majority Voting

• Extends QMV to the following fields: employment guidelines and incentive measures; social exclusion; free movement of persons (after fi ve years)

• Special treatment for foreign nationals; public health; equal opportunities and equal treatment for men and women; research and development;



countering fraud; customs co-operation; statistics; data protection; peripheral regions.

Institutional Changes

• Limits the number of members of the European Parliament to 700, however big the EU may grow.

• Nomination of Commission President by member states must be approved by Parliament; the Members of the Commission are to be nominated by common accord between the governments and the President; President to defi ne the Commission’s general political guidelines.

• ECJ given direct responsibility for ensuring that human rights are respected and its jurisdiction extended to the fi elds of immigration, asylum, visas and the crossing of borders, and police and judicial and criminal co-operation.

• EU Court of Auditors given new investigative powers.

Development of CFSP

• Provides for greater cooperation between member states in pursuit of a Common Foreign and Security Policy.

• Empowers the Union to carry out humanitarian aid and peacekeeping tasks (known as Petersberg tasks), to devise common strategies, general foreign policy guidelines, joint actions and common positions.

• The EU to be represented by a group (called the troika) consisting of the Presidency of the Council, the Commission and the Secretary-General of the Council, who will act as the Union’s ‘High Representative for the common foreign and security policy’ (a new post).

Social Questions and Civil Rights

• Empowers the Council to take appropriate action to combat discrimination based on sex, racial or ethnic origin, religion or belief, disability, age or sexual orientation and provides measures to combat discrimination based on disability. Makes the furtherance of gender equality a Community task.

• Provides for permanent and regular collaboration, within the Community framework, on employment and unemployment.

• Protects individuals from the processing of personal data and the free movement of such information by institutions and administrations that handle it.


The Treaties 11

Internal Security

• Provides for closer cooperation between police forces and customs authorities and directly with Europol, the European police network.

• Establishes a legal requirement to have closer cooperation between member states’ police and judicial authorities to combat and prevent racism, xenophobia, terrorism, organised crime, traffi cking of persons and offences against children, drug traffi cking, corruption and fraud.

• Establishes in principle a common minimum standard for rules and penalties for organised crime, terrorism and drug traffi cking.

Inward Migration

• Incorporates the Schengen agreement (an intergovernmental accord which establishes an area without impediment to free movement of travel between 13 of the 15 member states – UK and Denmark excluded) into the Treaty. Also provides for the removal of all controls on people crossing internal borders – whether EU citizens or nationals of non-member countries; in respect of controls at all the European Union’s external borders, establishes common standards and procedures for checking people, common rules on visas for intended stays of no more than three months, a common list of non-member countries whose nationals must hold visas when crossing external borders, and a list of non-member countries whose nationals are exempt from this requirement. Establishes common procedures and conditions for the issue of visas by member states and a defi nition of the terms on which nationals of non-member countries shall in principle be free to travel within the EU for three months.

• Defines minimum standards for the reception of asylum seekers in member states, and for classifying nationals of non-member countries as refugees.

• Lays down the terms of entry and residence of immigrants in the European Union, and standards for procedures for the issue of long-term visas and residence permits by member states, standards for dealing with illegal immigration and illegal residence, and the repatriation of illegal residents, and the rights of citizens of non-member countries who are legally resident in a member state and the terms on which they may reside in other member states.



The Environment, Public Health and Consumer Protection

• Stipulates that a high level of human health protection must be assured in the defi nition and implementation of all Community policies and activities.

• Provides for a high level of consumer protection.

Environment must be taken into account in all Community policies. Commission obliged to conduct an environmental impact assessment of its own proposals. Environment, public health and consumer protection legislation now covered (with rare exceptions) by the co-decision procedure, giving the European Parliament some power over these areas.

Box 2.4

Major Provisions of the Treaty of Nice

New Protocol on Enlargement adopted.QMV extended to new areas, principally:

• certain high-level appointments, including the President of the Commission and the High Representative for the Common Foreign and Security Policy

• certain aspects of the making of international agreements• actions taken in support of anti-discrimination measures adopted by the

member states• certain actions to enable citizens to take advantage of freedom of

movement• most measures related to visas, asylum and immigration• granting of emergency fi nancial assistance to member states• most industrial policy measures• from 2007, or the date of the adoption of the fi nancial perspective for

2007–13 if no agreement has been reached before 2007, measures relating to the Structural Funds

• fi nancial and technical cooperation agreements with third countries (does not apply to association agreements or pre-accession measures).

Formalisation of ‘Enhanced Cooperation’ – groups of at least eight member states may make agreements among themselves which enable them to go further in particular policy areas than the rest are prepared to do, provided such agreements:


The Treaties 13

• further the objectives of the EU and reinforce integration• respect the treaties and the single institutional framework of the

Union• respect existing EU law• respect existing competences• do not undermine the internal market or economic and social cohesion• respect the competences, rights and obligations of non-participating

member states• are in principle open to all member states• are used only as a last resort.

New judicial cooperation body, Eurojust, established.Clear procedure for amending the fundamental aims of the Union, in

consultation with the ECB and by unanimous vote at Council.Commission President given more power to manage the Commission, and to

force the resignation of an individual Commissioner. From 2005, Commission to consist of one member per member state until membership of the EU reaches 27. After that, membership to be fi xed at a number, and according to a system of national rotation, to be determined by unanimous vote at Council.

Maximum number of Members of the European Parliament fi xed at 732 (since revised to 750).

Establishment of an advisory Social Protection Committee.Procedure defi ned for setting up ‘political parties at European level’.Some European Council meetings (which had always taken place in the

country holding the Presidency) to be held in Brussels. From the accession of the 18th member state, all European Council meetings to be held in Brussels.


3The Institutions

At its current stage of development, the European Union is a curious amalgam of two things. Firstly, it remains to some extent a system to facilitate co-operation between independent member states, each of which has control over its own foreign policy, criminal law and, with certain limited but important exceptions, taxation. Secondly, however, it has in other areas evolved true supranational institutions which have powers quite independently of the member states, including, in some cases, the right to instruct and discipline those member states. The future development of the EU will depend upon which of these gains the upper hand.

The current governing institutions refl ect this state of fl ux. Some involve direct representation of member state governments, whilst others are entirely supranational in nature. The most important of the former in terms of power is the European Council. As far as daily decision-making is concerned, however, it is the Council of Ministers.

THE EUROPEAN COUNCIL

The European Council brings together the ‘heads of state or government’1 of each of the EU’s member states for regular, formal meetings at which decisions are taken which determine the immediate and longer-term direction of the Union. European Council meetings are attended by each country’s prime minister2 and minister of foreign affairs, as well as the President of the European Commission and one of his vice-presidents. They have generally taken place in the Presidency country, but this changed following a decision taken at Nice and included in the new Treaty. Since 2002, half of the European Council meetings have taken place in Brussels; since May, 2004, they have all been held there.3 This is clearly a question of practicalities and security, as well as a response to the amount of money host countries tend to spend on the show, but it seems an odd move for a body which, by its own admission, is seen as too remote from the people.

14


The Institutions 15

The European Council’s task is, fi rstly, to discuss any business which cannot be dealt with in any other way, usually because no provision exists for it in the Treaties or because there is a known difference of opinion between member states as to whether such provision does exist, over what is known as the interpretation of the Treaties. However much care is taken with the wording of a treaty, or of any measure taken by the European Union, whether and how it is applied in a concrete situation may sometimes be open to debate. Ultimately, the Court of Justice decides such disputes. The European Council, however, represents in part an attempt to keep them out of court by bringing together the highest authority in each member state government to broker compromise agreements.

Secondly, the European Council takes often far-reaching decisions over the Union’s direction. These will sometimes demand a change in the Treaty or, short of that, a new Community measure, a Directive or Regulation, which will then have to be formally proposed by the Commission before being approved by the member states and, in most cases, the European Parliament.

Finally, the European Council allows government leaders simply to chat, to air their views to each other on a range of topics, in a relatively informal milieu. This is no doubt pleasant for them, but more importantly it can provide an early warning system for potential problems and allow opinions to be sounded out. What precisely goes on in the palatial and usually secluded surroundings which are invariably chosen as the venue for these gatherings is, however, a matter for conjecture. In common with the other major decision-making bodies of the European Union – with the exception of the European Parliament – the European Council shrouds itself in a Kremlin-like secrecy which seems to many quite out of keeping with what might be expected from a community of democratic nations.4

THE COUNCIL OF THE EUROPEAN UNION, OR COUNCIL OF MINISTERS

The word ‘council’ is so beloved in EU circles that it has been used – as if there were not already suffi cient potential for confusion – to mean two quite different bodies. Though the European Council, described above, brings together the most powerful governmental politicians, it is the Council of the European Union, known generally as the



Council of Ministers or simply the Council, which takes decisions in particular policy areas.5

Most people would naturally think of the European Parliament as the EU’s legislature. In fact, however, the Parliament’s powers, though they have grown with each Treaty revision, remain quite limited. It does have a legislative role, but only as junior partner to the Council of Ministers.

The Council is in reality not one single body but rather an abstract term covering several distinct fora. Each of these deals with one policy area and brings together the relevant minister or ministers from each member state. There is thus an Agriculture Council, an Environment Council, a Social Affairs Council, and so on. In addition, the General Affairs Council is made up of foreign ministers, who may be accompanied by specialised ministers for European or EU affairs. Its task is to pull together decisions made by the separate ‘Councils’ and to deal with relations with third countries.6

The Council Presidency

Each member state holds the Presidency for six months in a system of rotation based partly on the alphabet, and partly on an attempt to avoid two major countries or too many smaller countries holding it in succession. The Presidency’s formal task is for its ministers to take the chair in meetings of the Council, which now normally take place in Brussels, as do meetings of the European Council. There is, however, also an expectation that the member state in question will exercise a temporary and limited form of leadership over the rest, seeking to bring important items on to the agenda or reinvigorate proposals which, for one reason or another, have gone dormant. In chairing Council meetings, the minister from the President country has a formal responsibility to seek common ground between member states whose opinions differ, suggesting compromises.

At the beginning of its six-month term each holder of the Presidency publishes a programme of priorities for legislative action, which usually includes some measure which has been held up for years because no agreement has been found which can unblock it. Sometimes a Presidency will be able to claim a number of successes based on a comparison of this programme with what has actually been achieved when the six months are up. More often, the programme will turn out to have been little more than a wish list.

In addition, the Presidency organises a series of conferences, seminars and other events to which Euro-MPs, Commissioners and


The Institutions 17

their staff, national parliamentarians and others are invited to discuss what are seen as the burning issues of the day. Finally, each country takes the opportunity of its Presidency to promote its culture, often by fi nancing visits to Brussels, or tours of the rest of the Union, by artists, writers, theatre groups, and so on. Because it does tend to put them in the spotlight, as well as entailing huge amounts of work for everyone from Cabinet First Secretaries to bar staff, the Presidency tends to be taken quite seriously by the member states. Smaller countries, in particular, are often at pains to show that they are quite capable of hosting the party.7

COREPER

Although elected politicians make up the EU’s two legislative bodies, civil servants naturally play a major role in the day-to-day running of the Union. The Council is served by the Committee of the Permanent Representatives of the Member States, known by its French acronym COREPER. COREPER prepares the agenda of Council meetings and then carries out its orders. If the Council has to examine a proposal from the Commission, it is usually COREPER which takes the fi rst look.

COREPER, like the Council itself, is a secretive body whose infl uence is extensive.8

THE CONVENTION AND INTERGOVERNMENTAL CONFERENCES

Each revision of the Treaty has been preceded (and must be preceded) by an Intergovernmental Conference (IGC). The Amsterdam IGC, which completed a decade of EC/EU reform, was the fourth in just eleven years, whereas only two had been held in the previous history of integration, since that which accompanied the establishment of the European Coal and Steel Community, the EC/EU’s forerunner. The Amsterdam Treaty provided that, at least one year before the Union has more than twenty Member States, a new intergovernmental conference must be convened. In fact, unanswered questions regarding enlargement led to the establishment of an IGC in 2000, resulting in a new Treaty, the Treaty of Nice. The Treaty of Nice in turn called for a further IGC to begin in 2004.

A growing feeling that the Union must make some attempt at least to appear democratic, led not to an abandonment of the wholly elitist system under which heads of government gather together with senior



bureaucrats to decide how things will be run – in other words the system of IGCs – but, as is usual in such cases, to an unconvincing fudge. Europe – someone, somewhere decided, in response to a tidal wave of popular indifference – should have a Constitution, and this Constitution must not be written by the Big Cheeses and Grands Légumes gathering behind closed doors, but by the People.

Unfortunately, although the People had shown no interest whatsoever in having such a Constitution, once offered it they were likely to demand that it contain all sorts of awkward things, perhaps even rights which they did not already enjoy. This had to be guarded against, and the best way to guard against it would be to establish a body which would stand in for the People, a Convention, and to put this Convention under the presidency of a member of the French nobility, Valéry Giscard d’Estaing.

Giscard was, to say the least, an odd choice. A former president that the citizens of France had blocked out of their collective memory, he was a product not of any kind of democratic tradition but of the French nobility and the elitist institutions created to enable dirigisme and oligarchy to survive the Revolution and the periodic upheavals which have characterised France ever since. He would, moreover, not be assisted in his task of proposing a text for a new EU Constitution by the People or anything which could seriously be seen as representative of this revered entity, but by the following: the President (Giscard), two vice-presidents (a former Belgian and a former Italian Prime Minister), 15 representatives of the member states’ heads of state or government, 30 members of the national parliaments (two per member state, regardless of its size), 16 members of the European Parliament, and two members of the European Commission. A basic knowledge of Europe’s political geography coupled with a rudimentary knowledge of arithmetic will be enough to work out how totally unrepresentative of the People this body was, so that there is no need to look into such arcane matters as gender balance (17 per cent women, 83 per cent men), representation of ethnic or other minorities (not seen as relevant), the failure to involve the ten member states which were about to join (a tricky matter, as actual accession remained subject to parliamentary votes and/or referenda in those countries), or the means whereby the fi nal text was arrived at (incomprehensible to anyone other than a professional politician or political bureaucrat, but as the Convention was entirely composed of such people, this hardly mattered).


The Institutions 19

The resulting text, which had cost the European Union’s long-suffering taxpayers an incalculable sum, was then rejected by the Heads of State or Government of the Member States meeting as a good, old-fashioned IGC. They then came up with their own text, which admittedly did not differ greatly from that proposed by Giscard’s unlovely gathering, and which is examined in Chapter 17.9

THE COMMISSION OF THE EUROPEAN COMMUNITIES

The European Commission is made up of unelected men and women, yet it has extensive formal powers.

From its inception in 1967, the Commission has grown in size with each enlargement of the Community. When the admission of Finland, Austria and Sweden brought the number of EU states to 15, the Commission’s membership reached 20, with one each coming from the ten smaller countries and two from, respectively, Spain, Italy, Germany, Britain and France. On the further enlargement of the Union in May, 2004, however, there was a strong feeling that permanent representation of all 25 – let alone the 27 expected in 2007 and the possibility of even more accessions beyond that – would result in an unwieldy and ineffective body and when the text of the Constitutional Treaty was agreed a few weeks later, it contained a provision to limit the number of members of the Commission to two-thirds of the number of member states, though not until 2009.10 In the meantime, some temporary solution would have to be found which would enable the Commission to function effi ciently.

It is not diffi cult to see why, even if all parties could see the logic of this, working out the details would prove too controversial. Simple rotation was initially resisted, as the big member states regarded the possibility of a Commission which would periodically lack a German, British, French or Italian member as unacceptable. A rather creative proposal to allow the Commission to grow as large as it might – with two members for all states with a population over a certain level and one for everyone else – and then to allow the President to designate a ‘Cabinet’ which would be supported by a team of ‘junior ministers’, was felt to be a recipe for permanent strife, in which portfolios would be distributed according to a country’s muscle rather than its candidates’ talents.

The eventual compromise solution was that from six months after enlargement – thus from 1 November 2004 – the Commission would consist of one Commissioner per member state. However,



when the Union reaches a membership of 27 – in 2007, or at some later date if this enlargement is delayed or abandoned – the number of commissioners will not be increased accordingly. As nothing is laid down in any binding instrument of the Union as to how the rotation will work in practice, the actual composition of the Commission will be determined at will by the member states acting through the Council. Possibly, the two new member states, if Bulgaria and Romania are indeed admitted by the target dates which they have been given,11 will simply be asked to wait.

As in a conventional government, each member of the Commission is given responsibility for a particular policy area or areas. It is here that the weakest member states are likely to lose out, routinely seeing their nominees shunted off to policy areas which do not touch the real centres of power or the most vital interests.

This likelihood is compounded by the EU’s structure, which does not see the Commission, unlike the Council, as representing the member states at all. The Commissioners are appointed by the member state governments, but are constitutionally independent of them. In other words, they may not take any form of instruction and are supposed to represent the interests of the European Community and make sure the Treaties are respected, standing above the national interests which legitimately play themselves out in the Council and, to the extent that the voters may decide that this is what they wish to see, the European Parliament. This means that a Council which lacked a Maltese or Latvian minister would be hard to defend from charges of what dissident Communists once levelled against the Soviet Union: ‘Great Power Chauvinism’. A Commissioner’s nationality should ideally be irrelevant, however. That this is a fantasy is demonstrated by the fact that the way Commissioners are nominated depends very much on national power, and as long as this is the case the very smallest member states will have to be assured, if not of permanent representation, at least of a system of rotation which does more than pay lip service to fairness. This was achieved, at least on paper, in the Constitutional Treaty, but whether this Treaty will ever come into force, and how this aspect of it will work out in practice, remain to be seen.12

Since the Treaty of Nice the Council, acting by a qualified majority, nominates the President of the Commission. QMV does not mean, however, that the wishes of a big member state will ever be overridden. Objections from the UK have stymied the chances of a number of candidates who were regarded as ‘too federalist’, for


The Institutions 21

example. Even medium-sized member states might fi nd here that serious objections would be respected, as a President who could not count on a certain basic level of co-operation from all but the very smallest countries would be in a very diffi cult position and might well lead the Union into an ongoing crisis. QMV does, however, guard against the embarrassment of total deadlock.

The Council’s nomination must be approved by the European Parliament. Once this is achieved the Council, again using QMV, and in agreement with the President-designate, adopts a list of proposed Commissioners, in practice endorsing the candidates put forward by the member states.

At this point the President’s appointment remains unconfi rmed, because his or her nomination must then be approved as part of the approval by the European Parliament of the entire Commission as a body. Once this is achieved, the Council again votes by qualifi ed majority to confi rm the Commission’s composition in its entirety.

At Nice, the Commission President gained new powers. The President can now take decisions on the Commission’s internal organisation ‘in order to ensure that it acts consistently, effi ciently and on the basis of collective responsibility’. Though his choice must be approved by the rest of the Commission (referred to, collectively, as the ‘College’ of Commissioners), he also gets to choose his vice-president. Importantly, Commissioners can now be sacked by the President; or rather, like football managers, they can be ‘asked to resign’.

The Commission is the real driving force behind the integrationist project. It has four practical functions, each of which in practice gives it immense power.

Firstly, it proposes new laws and other measures. Though these are often done at the behest of the Council, and must then be approved (and can be amended) by the Council and in most cases by the Parliament as well, the fact that the Commission works on the detail of initial proposals gives it a major infl uence over policy. The Commission enjoys what is known as the ‘Power of Initiative’: neither the Council nor the Parliament has the formal power to propose legislative or other Community measures, including Directives, Regulations, Recommendations and the annual budget.

Secondly, it is responsible for the day-to-day running of Community affairs, acting as a sort of hands-on executive with specifi c powers independent of the member states and laid down in the Treaties. Outside the legislative process, which is discussed in more detail in



the next chapter, the Commission is the main body responsible for supervising the implementation of existing law and of the budget, and for bringing member states which break or fail to implement such law into line, including by taking punitive measures or prosecuting them before the Court of Justice. An important aspect of this is the enforcement of competition rules, including ensuring that state subsidies are paid only in those exceptional areas where they continue to be allowed.

Thirdly, it is charged with ensuring that those same Treaties are correctly implemented and respected. In its own view it ‘represents the common interest’ standing above the national interests of the constituent parts of the Union, and its members are required to swear an oath to that effect.

In relation to monetary union, the Commission is responsible for making a recommendation to the Council in the event of a member state which has not already adopted the euro applying to do so. It also has the task of submitting recommendations to the Council for draft broad guidelines for the economic policies of the member states, for making recommendations in the event of a eurozone member not complying with the guidelines once adopted, and for making proposals for measures in the event of serious economic diffi culties in the Union as a whole or an individual member state.

Finally, it is the responsibility of the Commission to deal with aspects of foreign relations which come under Community competence, principally those having to do with trade. In these cases it is the Commission which negotiates agreements and must then ensure that they are respected, though the Council must also ratify them.13 The European Parliament’s power to reject the Commission, and indeed to sack it at any time after its appointment, appears to represent a real democratic input into the process whereby the EU executive is appointed. However, the fact that it may not reject an individual appointee but only the proposed College en bloc, means that the power is less useful than it might seem, undermined by its own fi nality.

Many people believed that because of the draconian nature of its only disciplinary power, the Parliament would never take the step of throwing a Commission out. This impression has been confi rmed more than once when the EP, making itself look rather foolish in the process, has threatened to do just that before backing down at the last minute.


The Institutions 23

Such a view was, however, dealt a blow in March 1999 when the European Commission resigned in order to avoid the indignity of being fi red, a fate which was beginning to seem increasingly likely. Of course, whether the Parliament would have gone through with its threat we will never know. Also, the peculiar circumstances surrounding the event must be acknowledged. Members of the European Parliament would have to stand for re-election only three months later, and poll returns were revealing the embarrassing fact that fewer than half of the eligible voters in the member states were intending to vote. It would be unfair, perhaps, to dismiss the whole event as a pre-election publicity stunt, but there was certainly at least an element of attention-seeking in the Parliament’s behaviour. More importantly, however, the Santer Commission was mired in incompetence and corruption. Santer’s undignifi ed, blustering reaction to Parliament’s allegations was less than impressive.

Widespread corruption at the Commission had been revealed by the actions of one courageous employee, Paul van Buitenen.14 Early in December 1998 van Buitenen, an assistant auditor in the Financial Control Directorate, went public with a long list of fi nancial irregularities that demonstrated what anyone who has dealings with the Commission can see very well, that the institution is riddled with an elitist, anti-democratic ethos. The defensive reaction to van Buitenen’s revelations, the open victimisation of the man who had made them, and the clear failure to understand what all the fuss was about, confi rmed the truth of this impression. Here was a body which was not only corrupt but which exhibited the same kind of esprit de corps shown by certain police forces and military units, a sort of schoolboy code of silence which would be hilarious were it not so dangerous to the democratic process. Funds had disappeared, contracts had been awarded in extremely suspect circumstances, and numerous examples were uncovered, going to the very top of the institution, of what the Dutchman van Buitenen would term vriendjespolitiek (literally, ‘boyfriend/girlfriend politics’) – and yet he was reviled by colleagues and victimised by his bosses for exposing these facts to the European Parliament. To its credit, whatever the mix of motives, the Parliament for once sounded credible when it threatened to act.15

The message sent to the EU’s reluctant voters just over fi ve years later, when the Parliament, unhappy with certain nominations, delayed its approval of the College by several weeks, was less clear-cut. In this case the events took place shortly after the election of



June 2004, when more than half of the eligible voters again stayed away, though turnout in the countries which had been members before the previous month’s enlargement did rise signifi cantly, offset by low participation rates in the accession countries.

MEPs from different sides of the house were unhappy with a number of nominations, either on the grounds that they were inadequate to the task, or that they had allegedly (or, in at least one case, most certainly) been involved in fi nancial scandals which did not refl ect well on them. All of this was aired at a series of hearings at which each nominee is in turn expected to appear in order to answer questions from members. After the hearings MEPs may declare that they think a particular individual is unsuitable to be a Commissioner, or, less drastically, that he or she has been given an inappropriate portfolio. This is precisely what happened, with questions being raised about the suitability of some, and others being clearly revealed in the hearings as poorly briefed on the particular policy area to which the President-designate, José Barroso, had stated his intention to assign them.

Barroso stonewalled, but in the end the Parliament did get its way, if only in one case. Rocco Buttiglione, the ultra-conservative Catholic ideologue whom Italy’s right-wing government had seen fi t to nominate, was declared unsuitable. The former Portuguese prime minister appointed to head the Commission had probably sealed Buttiglione’s fate by choosing him to head up the sensitive area of Justice and Home Affairs, but his open homophobia and medieval attitudes to women would almost certainly have made him in any case unacceptable to all but the most right-wing of deputies. Social Democrats, Liberals, the United Left Group and Greens all voted solidly to reject him, and the Union faced a crisis, having no Commission ready to take over by the appointed date of 1 November.

In the end Buttiglione accepted his fate, the Italians grudgingly sent someone who had noticed the moral changes of the last 800 years, and in exchange also for a face-saving reshuffl e, the Parliament backed down over its other objections. The crisis was averted.16

At this point one is entitled to ask what sort of system it is that, although operating within officially foreseen parameters, can nevertheless produce a crisis. The answer is that this is actually typical of the way in which the European Union does business. Over the last 15 years the electorates of various member states have been posed a question in a referendum. The process continues with the decision of many countries to put the European Constitutional Treaty to a


The Institutions 25

popular vote, though at least in theory the same applies to those who will leave the decision to their parliaments. In a referendum, the people are asked a question to which they may give more than one answer. Usually, the question is framed so that the answer can simply be yes or no. The authorities then respond to that question, and the state and the people go about their business.

This is not what happens in an EU-related referendum. In every such referendum held in a member state, if the people answered ‘no’ the result has been a crisis. This is, to say the least, a peculiar version of democracy.

In 2004 the Parliament found itself in the same situation. It was asked if it would approve the Commission, yea or nay. Yet when it said nay, or rather, ‘not unless ...’, the result was a huge political crisis which, we were told, threatened the very survival of the Union. One of the most disturbing aspects of this, moreover, is the way in which its utterly undemocratic and quite absurd nature went unremarked in the mainstream media. Some wanted Barroso to stand up to the Parliament and support Mr Buttiglione. Others thought Buttiglione was too conservative and the Parliament should stick to its guns. Yet what no one was saying was surely much more important than this transient dispute: a system in which a democratically-elected body cannot exercise its constitutional rights without crippling the system of which it forms part is one whose design is disastrous, inherently autocratic and fit only for the scrapheap of failed political structures.

Giving the Parliament the right to reject or approve each individual nominee would solve the problem at a stroke, but it would also threaten the jealously-guarded powers of the Council, which shows no tendency to become less autocratic as the Union grows in size. The upshot is that the Commission is chosen with no real input from national parliaments under a system which offers the European Parliament extremely limited infl uence over its fi nal composition. The people have, in other words, no effective say in the composition of the EU’s powerful executive.

THE EUROPEAN PARLIAMENT

Until 1979, Members of the European Parliament were appointed by national parliaments from amongst their own members. Although this may sound less democratic, many opponents of the EU in its present form argue that, controlled by national parliamentarians,



the European Assembly, as it was often called in Britain, could have provided a truer and more effective counterbalance to the Council of Ministers. The introduction of direct elections was a victory for integrationists, and every addition to the powers of the European Parliament since then must be viewed in this light.

As with the Commission, the number of Members of the European Parliament has increased with each enlargement, with the entry of ten new countries in 2004 bringing it to 732, distributed as follows (see Table 3.1): Germany – 99; France, Italy and the United Kingdom – 78; Spain and Poland – 54; the Netherlands – 27; Belgium, Greece, Hungary, Portugal, and the Czech Republic – 24; Sweden – 19; Austria – 18; Denmark, Finland and Slovakia – 14; Ireland and Lithuania – 13; Latvia – 9; Slovenia – 7; Cyprus, Estonia and Luxembourg – 6; and Malta – 5. This will rise to 782 if Bulgaria and Romania are admitted, as planned, before the next scheduled elections in 2009, but will then be reduced to 750, a fi gure agreed as ‘permanent’. This is a revision of the fi gure (732) laid down at Nice, and there is nothing to stop this from being changed. However, the limit, though presented as a purely practical measure, favours the major political tendencies, which makes any further increase unlikely unless there is a dramatic shift in the political balance of power. Also, as the system is incorporated into the Constitutional Treaty, it will require unanimity to change it should that Treaty or some revised version ever be approved and come into force.

The European Parliament’s original function was consultative. Since 1970, however, it has exercised real power over the budget. In addition, the Treaties of Maastricht and Amsterdam extended a power of co-decision introduced in 1987 with the Single European Act. Co-decision has made the Parliament an important part of the European Union’s legislative process. The claim, heard from both opponents and supporters of integrationism, that the European Parliament is toothless, or a talking shop, is out of date.

How it chooses to use its power is another matter. Despite attempts to woo the citizens of the member states with much self-promotion, criticism of the secrecy and elitism of the other institutions, and the appointment of an Ombudsman to look after their interests, the EP is unloved and largely ignored. The Parliament, though it includes opponents of the EU and ‘Eurosceptics’, has a built-in majority of sometimes quite extreme integrationist tendencies, hardly refl ecting the reality of political opinion across the member states. Its major point of embarrassment is the very low turnout at elections: in 1999


The Institutions 27

Table 3.1 Membership of the European Parliament by Member State and Political Group

EPP-ED PES ALDE GREENS/EFA GUE/NGL ID UEN NI Total

Belgium 6 7 6 2 3 24Czech 14 2 6 1 1 24Denmark 1 5 4 1 1 1 1 14Germany 49 23 7 13 7 99Estonia 1 3 2 6Greece 11 8 4 1 24Spain 24 24 2 3 1 54France 17 31 11 6 3 3 7 78Ireland 5 1 1 1 1 4 13Italy 24 16 12 2 7 4 9 4 78Cyprus 3 1 2 6Latvia 3 1 1 4 9Lithuania 2 2 7 2 13Luxembrg 3 1 1 1 1 6Hungary 13 9 2 24Malta 2 3 5Netherlds 7 7 5 4 2 2 27Austria 6 7 2 3 18Poland 19 10 4 10 7 4 54Portugal 9 12 3 24Slovenia 4 1 2 7Slovakia 8 3 3 14Finland 4 3 5 1 1 14Sweden 5 5 3 1 2 3 19UK 28 19 12 5 1 10 3 78TOTAL 268 202 88 42 41 36 27 28 732

This presents the picture at 15 February 2005. The Groups are as follows:

EPP-ED: Group of the European People’s Party (Christian Democrats) and European Democrats. Centre-right parties. Includes the British Conservative Party, the Northern Ireland Offi cial Unionists, and Ireland’s Fine Gael.PES: Socialist Group in the European Parliament. Centre-left parties. Includes the British Labour Party, Northern Ireland’s Social Democratic and Labour Party, and Ireland’s Labour Party.ALDE: Group of the Alliance of Liberals and Democrats for Europe. Liberal parties. Continental liberals tend to be well to the right of the British version but ‘liberal’ on social and ‘moral’ issues. Includes the British Liberal Democrats and Ireland’s Marian Harkin, who is not a member of any national political party.Greens/EFA: Group of the Greens/European Free Alliance. Greens combined with a few progressive nationalists, including Plaed Cymru and the Scottish Nationalist Party.GUE/NGL: Confederal Group of the European United Left/Nordic Green Left. Members from parties to the left of those in the PES. From the southern and eastern member states these come mainly from the Communist tradition, and from the northern member states a variety of tendencies. Sinn Fein, which sits in the GUE/NGL, is the only party to have won representation in two member states.



and 2004, fewer than 50 per cent of eligible voters bothered to turn up. Clearly, the keener one is on the EU, the greater the likelihood of participation, and this distorts the make-up of the Parliament.

At Nice an attempt was made either to strengthen further the domination of integrationists, or to generate more interest in politics at the European level: which interpretation you favour will depend on your view of the Treaty’s provision of a legal base for the establishment of ‘Political Parties at European Level’. The consequent Regulation, introduced after much haggling in July 2004, stipulates that to be eligible for funding – the crucial question – a party’s components must fulfi l one of the following conditions: representation in at least 25 per cent of member states, through seats in either the European Parliament, the national parliaments or a regional assembly;17 or receipt of at least 3 per cent of the votes cast at the most recent European elections in at least 25 per cent of member states.

Although supporters of the idea have been at pains to stress that the money will be available to critics of the EU, there are some political conditions attached which seem at the very least open to abuse. A European party must respect the principles of the EU, which are somewhat vaguely defi ned as respect for liberty, democracy, human rights and fundamental freedoms, and the rule of law. In addition, it must be admitted that as UKIP Euro-MP Nigel Farage has pointed out, ‘the avowed aim of the measure is to “promote European integra-tion”. This poses a particular problem if the name of your political organisation is the United Kingdom Independence Party!’18

A total of €8.4 million per year is available for funding, of which 15 per cent will be distributed in equal shares among the parties, with the rest proportionate to their strength in the European Parliament. Applications must be renewed annually, and the money may be used only to cover expenditure directly linked to the objectives set out in the European party’s political programme and not for the direct or indirect funding of its national components.

Even if the system is run fairly, and EU-critical and other non-mainstream parties given access to funds, the elite structures thus

ID: Independence/Democracy Group. EU-critical members from a variety of tendencies. Includes the United Kingdom Independence Party and Kathy Sinnott, an Irish independent.UEN: Union for Europe of the Nations Group. Berlusconi’s party with a few like-minded right-wingers from other member states. Includes Ireland’s Fianna Fail.NI: Non-attached Members. Mostly fascists, but some others who, for various reasons, nobody will have in their groups. Also includes Northern Ireland’s Democratic Unionists.


The Institutions 29

established, which create no space for popular involvement but merely allow leadership to speak unto leadership, seem unlikely to create a wave of enthusiasm amongst European voters. Indeed, it is highly unlikely that anyone not already involved in a political party, and already interested in ‘Europe’, will ever hear of their existence.

Another reason for widespread indifference to the European Parliament may be that, as the assembly’s power has grown, so has the interest and infl uence of corporate lobbying. Scandinavians, in particular, are shocked by the openness with which members will declare that they have had, for example, ‘representations from industry’ over a particular proposal. The most powerful committees are often held before packed public galleries, though a straw poll of those attending would almost always reveal that corporate lobbyists are heavily represented. Plenary assemblies, which occur roughly once a month at Strasbourg and less frequently, and in a shorter form, at Brussels, are also accompanied by huge lobbying efforts. As for the members, some would get marks for honesty if, like footballers, they wore the names of their corporate sponsors on their shirts.

THE EUROPEAN COURT OF JUSTICE

The European Court of Justice (ECJ) is made up of one representative from each member state, appointed by ‘common accord of the governments of the Member States’ for six-year terms. The Justices choose a President from amongst their number. He or she serves a three-year term but may be re-elected. The ECJ’s offi cial function is to ensure that European Union law is applied, and applied uniformly, in each of the member states, so that it reinforces the Commission’s work of monitoring and policing the application of directives and regulations, as well as the treaties themselves. The Court is assisted by Advocates-General, which it appoints. In addition, the European Court of First Instance exists to hear more routine cases and reduce the ECJ’s considerable workload, speeding up the notoriously long process from complaint to judgment.

Comparable in some ways to the US Supreme Court, its much more recent origins and the controversial, supranational nature of the European Union mean that the ECJ lacks that body’s prestige. Many important areas of law, even now – particularly criminal law – remain under the absolute or substantial control of the member states, limiting the visibility of the Court to ordinary citizens. To most people, the Court, if they have heard of it at all, appears remote and



bureaucratic, unconnected to their everyday lives. The tendency to confuse it with the Council of Europe’s European Court of Human Rights (ECHR) is so widespread that many Euro-MPs keep a stack of ECHR application forms to hand to send to constituents who enquire about it.

This indifference is increasingly misconceived. Unlike the ECHR, the ECJ has real power. New laws are often open to a range of interpretations, as is the Treaty, and this gives the last word to the Court. It can even declare a law invalid if it views it as confl icting with the Union’s obligations under the Treaty; mirroring this, it can also bring proceedings against the Commission or Council if it fails to act in fulfi lment of such obligations.

This power of interpretation has enabled the ECJ to function rather in the way of the World Trade Organisation, with far more direct power and on the basis of much the same principles. A member state can, according to the Treaties, exclude imports on the grounds that they contradict policies and laws designed to protect the consumer or the environment, but it is incumbent on the member state, if challenged by a would-be importer, to prove that it is not hiding the foul fi end of protectionism behind the angel of responsible government.

The European Court of Justice can, not surprisingly, be criticised on much the same grounds as can the courts of most member states. Minorities are unrepresented and women few and far between. No fi gures are kept on the social backgrounds of the justices, but they naturally tend to be men who have reached the peak of a particular profession and can hardly be said to be representative. Yet they have the power to overturn laws which have been made or upheld by democratically elected national governments.19

OTHER EUROPEAN UNION INSTITUTIONS

As well as the Commission, Council, Parliament and Court of Justice the EU’s institutional structure comprises a number of lesser-known bodies. Some come under the public eye less often because their duties are internal, technical or more limited in application. The European Court of Auditors, as its name suggests, exists to ensure fi nancial probity amongst the institutions. Its Annual Report does tend to give it a brief yearly notoriety, largely because it invariably takes the form of a catalogue of waste, excess and downright fraud, making it the favourite reading of many journalists and EU-critical


The Institutions 31

politicians. Its members are appointed by the Council by unanimous vote, and their number is the same as that of the member states.20

The Economic and Social Committee (ESC, or ECOSOC) represents what in the excruciating euro-jargon are termed the ‘social partners’, otherwise known as employers and trade unions. Its members are appointed by the Council and divide into the Employers’ Group or Group I, the Workers’ Group (Group II) and the splendidly titled Various Interests Group, which includes representatives of agriculture, small and medium-sized enterprises (SMEs) the professions and ‘skilled trades’, and a number of people from interest groups representing, inter alia, consumers, environmentalists, family interests and so on. ECOSOC has no power, only the right to be consulted, and its offi cial ‘opinions’ are generally ignored by everyone who isn’t actually a member of it. The Nice Treaty attempted to increase ECOSOC’s democratic credibility by broadening representation, now defi ned as ‘representatives of the various economic and social components of organised civil society’ with ‘consumers’ added to the rather quaint list of groups to be included: ‘producers, farmers, carriers, workers, dealers, craftsmen, professional occupations … and the general public’. Its membership before Nice was the mystical-sounding 222, but the new Treaty prepared for enlargement by defi ning a formula for the Committee’s growth to a maximum of 350.21

ECOSOC has been around as long as the Community itself. Not so the Union’s other talking shop, the Committee of the Regions (CoR). Its members are appointed by the Council on proposals from each member state. In common with ECOSOC, the CoR has absolutely no power, merely the right to be consulted. Its members are taken from local authorities and, where they exist, regional governments. There were some fears when it was established that it formed part of an integrationist strategy to undermine the powers of national authorities, but if these had any grounds they have not been realised. The CoR is a total waste of taxpayers’ money, but seems to do no harm beyond that. As with ECOSOC, Nice provided a formula for increasing the CoR’s size as new member states are admitted, to a maximum of 350.22


4How the European Union Makes Law

The powers and responsibilities of the European Union (its ‘competences’) are defi ned in the Treaty of Rome and subsequent amendments. From its inception, the Community had responsibility for the common policies, most importantly covering agriculture, fisheries and international trade. Added to these original responsibilities have been such matters as transport, environmental protection, consumer protection and public health, research and development, the promotion of economic and social cohesion, and cooperation with developing countries.

This growth in power and infl uence has come about through both formal and informal means. In other words, in some cases competences which were in the original Treaty of Rome were scarcely exercised, usually because of political problems stemming from the national interests of the member states. In some cases, the Union has simply found itself in a situation in which it can exercise in practice powers that it has always enjoyed in theory. In addition, with each formal step in integration new competences have been added.

DIFFERENT SORTS OF LAW

European Union laws take various forms. The most important is probably the Directive, which sets out a policy objective but requires national legislation to implement, or ‘transpose’. This gives a certain amount of leeway to the member states and allows for differing conditions, as well, inadvertently perhaps, for different degrees of enthusiasm. A time limit for transposition, usually two years or less, is laid down in each directive, but this is often breached. Where such a breach occurs, or if the Commission is not convinced that national implementing legislation is adequate, the ECJ has the fi nal word, but court cases also take time, of course, and may allow a member state to delay fulfi lling its responsibilities.

Regulations apply immediately throughout the territory of the Union, without requirement for legislation at national level. Decisions are also binding, but unlike Regulations and Directives they apply

32


How the European Union Makes Law 33

only to the body or bodies to whom they are addressed, which may be a member state, a legal person (usually a corporation) or a natural person (you and me). The EU institutions may have a certain amount of leeway in deciding which sort of law is appropriate in which case, but in reality this is usually dictated by the Treaties.

In addition to these three legislative instruments, the Union or its institutions have a number of non-binding measures at their disposal. A Recommendation is issued by the Commission or by the Council but does not bind member states: again, its name speaks for itself. An Opinion also requires little explanation. Finally, the Commission may issue offi cial Communications stating its views, the Council may make Declarations, and the Parliament issues a constant stream of resolutions dealing with issues over which it has no real power, but where it hopes to exercise infl uence. Every session of the Parliament passes resolutions on human rights, for example, or crises which are beyond its reach. It has entire committees which deal with no legislative proposals at all, except through the consultation procedure, simply because it does not have competence in those areas.1

Each of the institutions described in the previous chapter has a role to play in the creation and implementation of European Union law. Just what that role is is usually determined by the type of law being made, the policy area being crucial. For every proposed law there must be a treaty base. In other words, the Commission, when making a proposal, must be able to cite an Article in the Treaty which gives the EU authority to make laws in that specifi c policy area. This ‘treaty base’ can be challenged before the Court of Justice, which has the fi nal say as to whether or not it is legitimate.

The choice of treaty base is crucial, because on it will depend which of the various legislative procedures is used, and therefore the extent of infl uence of the European Parliament and whether the Council, in approving, rejecting or amending the proposal, must do so by unanimity or by Qualifi ed Majority Voting.

QMV is a tremendously politically loaded issue. It is now argued that, because the Union comprises 25 states, the requirement for unanimity in some areas makes it impossible to make any further ‘progress’ in relation to these policies. Whether true or not, this is hardly an argument in the system’s favour which should be advanced by any democrat. QMV means that laws which are opposed by a sovereign state’s government and may be abhorrent to its people can be imposed upon them. There may be defences of this, but practicality simply will not do. Dictatorship has always been quicker



and more practical than that tiresome business of asking the people what they want.

Majority voting has been extended to new areas at every amendment of the Treaty since the Single European Act. Although the integrationists pronounced themselves ‘disappointed’ by it, Nice continued this process, and if the Constitutional Treaty wins approval, this extension will be consolidated. After four successive extensions of QMV, only the most politically sensitive issues – defence operations, most tax matters, cultural policy amongst them – are left requiring unanimity.

THE LEGISLATIVE PROCEDURES

There are now four main legislative procedures: consultation, co-operation, co-decision and assent. In addition, there is a special procedure for the annual budget.

Proposals generally begin life on the desk (or screen) of someone at the Commission, though they are often issued at the request of the Council, or because the Treaty obliges it. Before sending a proposal to the Council, and, where required, the Parliament, the Commission generally conducts a wide exercise of consultation. It does this, in many cases, by issuing a Green Paper, followed by a White Paper. These present the Commission’s opinion on a given subject and invite interested parties to make their opinions known. Green Papers propose the fi rst ideas for discussion in a specifi c fi eld where a Community action might be envisaged, often presenting a range of alternative approaches. White Papers set out more detailed suggestions. Having weighed up the various responses, the Commission then makes a formal proposal for what it sees as an appropriate measure.

The most complicated legislative procedure, and the one which gives the greatest infl uence to the European Parliament, is known as ‘co-decision’. Under co-decision, a proposal for a Directive or Regulation is sent by the Commission to the Council and Parliament. The Parliament may propose amendments which are then sent to the Council. If the Council accepts the amendments they are incorporated into the directive. If it rejects any of them, however (and instant agreement is the exception), or introduces any amendments of its own, then the proposal (with any accepted amendments incorporated) returns to the Parliament for a second reading. The document returned to the Parliament refl ects a consensus within the Council and is known as the Common Position. The Parliament may



then represent its original amendments, reject or change Council’s amendments, or present entirely new amendments. It may, however, present new amendments only if circumstances have changed since the fi rst reading (for example, in a Directive dealing with pollution, new scientifi c discoveries may have been made justifying the placing or removing of restrictions on a particular product or process).

At second reading an important new element appears. At fi rst reading amendments need only win the support of a majority of members present when the vote is taken. At second reading, however, they must win the support of an absolute majority of the whole membership of the Parliament, whether present or not. This makes it much more diffi cult to win. Essentially the effects of this rule are conservative, and tilt the balance of power away from the Parliament and towards the Commission and Council. They also mean that in order to win the day, amendments must have the support of more than one political group, for even the very biggest, the centre-right EPP-ED, cannot command the support of 50 per cent+1 of the membership. Often, this will mean that the two biggest groups must come up with a consensus, a process which has a deadening effect. An alternative emerges only when PES and EPP-ED are unable to agree. Then each must look for support amongst its natural allies to right or left (the Liberals and UEN for the EPP-ED, the United Left and Greens/EFA for the PES), and the Parliament briefl y takes on the atmosphere of the type of adversary politics more familiar to most English-speakers from their own countries’ systems.

Once the Parliament has agreed its amendments, the Council will consider them. If it does not accept any of the newly proposed amendments, a Conciliation Committee – made up of equal numbers of members of Parliament and the Council, with the Commission present as an observer, and sometimes to propose compromises – is appointed. Its job is to draw up a joint text that the Council and Parliament may adopt, with the matter then going to a full meeting of each body for fi nal approval. If no agreement can be found, Parliament can reject the proposal outright. If it does so, however, the whole process must begin again with a new proposal from the Commission. For this reason, conciliations, which are becoming increasingly common, can last deep into the night.

With the important exceptions of agriculture and competition policy, the co-decision procedure now applies to all areas of legislation where the Council takes decisions by QMV. In a small number of areas – freedom of movement, including in relation to social security,



mutual recognition of educational and professional qualifi cations, and cultural policy, the co-decision procedure is applied even though unanimity is required at Council.

During the last parliamentary session, which ran from 1999 to 2004, an informal system of consultation within and across institutions grew up in parallel to the system laid down in the Treaties and the formal rules of procedure based on them. Of course, informal consultations and negotiations have always characterised the legislative process, but as the various actors grew more familiar with the system of multiple readings and the Conciliation process, a consensus emerged as to the best ways to ensure its smooth running.

Because it is possible, in the event of agreement between Council and Parliament, to adopt an act at first reading, and because, especially where everyone agrees that legislative reform in a certain case is urgently needed, all sides have an interest in expediting the procedure, the development of such an informal system was always likely. The Parliament’s Rapporteur, once appointed, will often ask for a meeting with the ‘Shadows’, members chosen by other political Groups to take responsibility for organising their response to his or her work and to the proposal with which it deals. The aim will be to fi nd out what these Groups are thinking, what they will agree to and what they may fi nd objectionable. Although this will become evident the fi rst time the ‘dossier’ (as a piece of business is known in the institutional jargon) is openly debated at a meeting of the relevant Parliamentary Committee, the Rapporteur may prefer to gauge the range of views before this. Alternatively, or in addition, informal meetings may be called after the fi rst ‘Exchange of Views’ at Committee, and Groups’ views and intentions ascertained. At this point a representative of the Commission may also be invited, with the aim of discovering areas of agreement and disagreement between the Commission and the Parliament’s various political tendencies. The Rapporteur and Commission offi cials will also be privy to the range of thinking in the Council. These informal consultations have a number of functions. Not only do they expedite the procedure and help to avoid unnecessary extra readings and the dreaded Conciliation, they mean that members can avoid wasting their time pursuing amendments which have no chance of success. MEPs do in fact often decide, as a political gesture, to do just that, but at least they are aware of what they are doing.

On the other hand, by standing outside the formal rules of procedure, this process avoids democratic constraints such as the



public’s right of scrutiny and obligations to minority political Groups. Undoubtedly there are times when it is legitimate for politicians and offi cials to meet in private, and in general, because the co-operation of minorities is often needed if the system is to work, their views are respected, but over the last few years what should be an adjunct to the system has become the way in which, except in the most routine or uncontroversial of cases, business is conducted. One solution would be to introduce the Scandinavian system where notes must be kept on such meetings and these made available for public scrutiny, but things do not, to say the least, show much sign of moving in the direction of such openness.

The co-operation procedure is similar to co-decision in that it enables the Parliament to amend a Commission proposal. This again requires two readings by Parliament. As there is no provision for Conciliation, however, and as it gives the last word to the Council, co-operation gives the EP much less power and infl uence than does co-decision.

Both co-decision and co-operation encourage the formation of alliances across and between the institutions. Under co-decision, governments can work closely with MEPs from their own parties or who happen to share their views on a certain issue. With co-operation, if the Commission and Parliament agree on amendments, the text can be adopted by a Qualifi ed Majority at Council. This means that if the two institutions and an effective voting majority of member states agree, an amended proposal becomes law. If, however, the Commission rejects the Parliament’s amendments, the Council must adopt the proposal unanimously, so that an alliance of one recalcitrant member state (even tiny Luxembourg will do) and the EP can block a proposed law.

The consultation procedure consists of simply requesting Parliament’s opinion before the Council adopts a Commission proposal for legislation. It gives the Parliament no formal power whatsoever, but can sometimes (depending on the balance of power and opinion within the other institutions, especially the Council) give it a certain infl uence.

Finally, the assent procedure’s name is self-explanatory. The assent of the Parliament is required, for example, when new member states are admitted or association agreements signed with third countries. As it gives no power to amend, assent is something of a blunt instrument, rather like the power to sack the Commission. The Parliament has attempted to use it to put pressure on certain countries – notably



Israel and Turkey – to improve human rights, but all it can do is threaten to withhold consent, or delay giving consent in order to cause inconvenience.2

THE BUDGET

The Budget is dealt with under a special procedure which, even before the Parliament fi rst became a directly-elected body in 1979, gave it considerable power. Certainly before the introduction of the co-operation procedure in the Single European Act of 1987, it was in relation to the annual European Community budget that the EP became most like a normal legislative body.

Before explaining this procedure, it may be worth asking some questions about the end result. Where does the money come from, and how is it spent?

The Union has four sources of revenue:

• Import tariffs: 75 per cent goes direct to the EU, with member states retaining the rest in respect of administrative costs.

• Levies: on agricultural imports (including a special levy on sugar). Again, the EU gets 75 per cent of the proceeds.

• VAT-based contributions: until 2003, 0.75 per cent of VAT receipts was paid to the Union. In 2004, this was reduced to 0.5 per cent.

• Contributions based on Gross National Product (GNP): this is open to constant negotiation, but was set at 1.02 per cent for 2003.

Roughly speaking, member states contribute to the budget in line with their ability to pay, assessed on the basis of various criteria, such as the level of economic development, population and per capita GNP. However, if one looks at the net contribution, direct payments to support agriculture distort this, by favouring countries where a greater proportion of the population works on the land. In the early 1980s member states agreed that the United Kingdom, which has relatively very few people engaged in farming, would receive an annual rebate as it was accepted that its net contribution to the EU budget was disproportionate.

Agricultural differences are not the only problem, however. The levy on VAT also fails to produce a fair refl ection of member states’ wealth. VAT rates vary, so that the proportion of GNP collected also



varies. This effect is exacerbated by the fact that while some states choose to use VAT exemptions or reductions to alleviate poverty or encourage certain kinds of spending (UK exclusions include food, children’s clothing and books; Belgium taxes books at 6 per cent as opposed to its usual high rate of 21 per cent, and so on) others, such as Denmark, impose a fl at rate, using other mechanisms to redistribute wealth. The VAT levy is by far the most important source of direct income, bringing in almost a quarter of the revenue, 24.7 per cent, in 2003.

Because own resources do not meet the whole of the EU’s budgetary needs, since 1988 they have been supplemented by a direct levy based on member states’ GNP. In order to offset the distorting effects of differential VAT rates, this levy varies according to the amount of the shortfall once other own resources have been calculated.

Also dating back to an agreement of 1988, ‘own resources’ may not exceed a certain percentage of the total of all member states’ GNP. This began at 1.15 per cent but has twice been raised, so that it now stands at 1.27 per cent. Because the shortfall is made up by a levy which directly relates to each nation’s wealth, the cap on own resources means that the fi nal total contribution made by each member state is more proportionate to its total fi nancial resources. In 2003, revenue sources broke down proportionally as follows: GNP-based ‘own resources’, 55.1 per cent; VAT-based resources, 22.7 per cent; customs duties, 10.1 per cent; agricultural duties and sugar levies, 1.5 per cent; and ‘other’, 10.5 per cent, this fi gure including moneys carried over from the previous year.3

Spending these resources is, not surprisingly, governed by a complex bureaucratic procedure.

Firstly, on the basis of what is required by the various treaties and legislation derived from them, spending is divided into ‘compulsory expenditure’ and ‘non-compulsory expenditure’. Under the fi rst comes most Common Agricultural Policy (CAP) spending: price support expenditure under the Guarantee section of the European Agricultural Guarantee and Guidance Fund (EAGGF) and some structural spending. In addition, similar expenditure under the Common Fisheries Policy (CFP) is compulsory in this sense, as are direct monetary refunds to the member states and some development aid. Following reforms at the end of the last century, non-compulsory spending now accounts for a majority of the budget – around 55 per cent since 2000. Unless some unexpected change occurs, this trend will continue, and, as foreseen in Agenda 2000, the Commission’s



blueprint for the development of the Union, compulsory expenditure should continue to take up a diminishing proportion of resources.4

THE BUDGETARY PROCEDURE

Since the Budgetary Treaty of 1970, amended and enhanced by a further treaty in 1975, the European Parliament and Council have together formed what is known as the budgetary authority.

This is perhaps the area in which the Parliament enjoys its greatest power, though even here it is limited both by informal pressure – failure to agree a budget could result in chaos – and formal restrictions. In particular, the Commission is able each year to determine a maximum which serves as a guideline to the extent to which expenditure may be increased in relation to the previous annual budget. This is done on the basis of three parameters: the growth of the total GNP of the member states; the average growth (or reduction) in member states’ own national annual budgets; and the overall EU infl ation rate. This guideline is not binding, however. The budgetary authority may exceed it, but only if Parliament and Council together agree to do so.

Although agriculture takes a declining share of the total budget, it remains by far the biggest item, accounting year after year for almost half of the Union’s spending, while the next biggest spending area, regional development, accounts for less than a quarter.5

Although expenditure is governed by multiannual guidelines agreed between the member states and the budgetary authority, within these parameters the budget itself, drawn up annually, begins life as a Commission proposal. This ‘Preliminary Draft Budget’ (PDB) is fi rst sent to the Council, where it must arrive at the latest by 1 September so that it may be implemented from 1 January the following year.

The Council, acting by qualified majority, considers the Commission’s proposal and adopts a modifi ed version of it, known as the ‘draft budget’, which it has until 5 October to forward to the Parliament. Parliament then has 45 days to adopt the budget or demand amendments. If, in that time, it fails to state a position, the budget is deemed to have been adopted. In practice, however, the Parliament sends the budget back within the stated period and requests amendments.

If the Parliament proposes changes to compulsory expenditure, it must do so by a majority of votes cast; if, however, the changes



affect non-compulsory expenditure, they must be adopted under the system which requires the approval of an absolute majority of all members.

Once the Council has received the Parliament’s proposals, it has 15 days in which to conduct what is called its ‘second reading’. If it accepts all of the Parliament’s proposed changes, the budget is adopted. If it does not, what happens next depends on the nature of the amendments. The crucial question is this: would a Parliament proposal require an increase in overall EU expenditure? If the answer is no, then the Council must reject or modify it by QMV, and if this does not happen it becomes part of the budget. If the answer is yes, then it must adopt it by QMV, and if a qualifi ed majority cannot be found to accept it, then it falls. If the Council is willing to accept an amendment only in modifi ed form, then it must send its (now fi nal) proposal back to the Parliament.

It is now Parliament’s turn to move swiftly. Within 15 days, it must conduct its own second reading, and if it misses this tight deadline the Council’s proposed compromise amendments are integrated into the budget and the budget adopted. Here, for once, the Parliament really does have the last word, though conditions governing the exercise of this power are stringent. Now, in order to amend or reject Council’s fi nal proposal, it must fi nd not only an absolute majority of all members, but also three-fi fths of those who actually turn up to vote.6

This vote completes the budgetary process, and the budget becomes law after it is taken – unless (didn’t you somehow know there would be an ‘unless’?) Parliament, on the basis of the same double majority, votes to reject the whole thing. In this event, the entire show must restart on the basis of a new proposal from the Commission. If no agreement is reached before 1 January, the Union must fi nance its activities through a system known as ‘provisional twelfths’. An idea borrowed from the United States’ federal government, this means that an appropriation is made each month which is equivalent to one-twelfth of the previous year’s budget.

Obviously, this can cause diffi culties. Even a low rate of infl ation requires some adjustment of the budget, but the provisional twelfths take no account of this. Nor does the system make allowance for the fact that spending is not evenly distributed throughout the year. The potential problems arising from this mean that pressure builds on the Parliament to accept something less than the fulfi lment of its every dream. The pro-EU press invariably presents the resulting



agreement as a sign of Parliament’s ‘growing maturity’. Less kind voices complain that it is yet another example of the assembly’s tendency to be all gong and no dinner.

Monitoring expenditure

It is one thing to fi x a budget and another to make sure that it is spent honestly and as intended. Again, the European Parliament has a relatively major role to play in this, through its Committee on Budgetary Control. This conducts on its behalf an annual assessment of the management of the budget before giving, on the basis of the Annual Report of the Court of Auditors, its approval, formally termed a ‘discharge’. As with the budget procedure itself, during the debate over the discharge the Parliament generally makes a tremendous fuss, but everything comes out all right in the end.7


5Enlargement

Since its foundation in 1957 by the original Six, the European Community (later the Union) has grown through a succession of enlargements to its present tally of 25 members. The admission of the United Kingdom, Ireland and Denmark in 1973 was followed in 1981 by the accession of Greece, and in 1986 by that of Spain and Portugal. In 1995 these countries were joined by Austria, Finland and Sweden. Then, on 1 May 2004, the Union at one stroke admitted ten new member states, one more than all previous additions put together. Beyond that, three countries – Bulgaria, Romania and Turkey – are involved in negotiations which give them offi cial status as pre-accession states. Of these, the fi rst two have been given target accession dates of 2007. Turkey, whose application is more controversial, has as yet to be informed of such a date. In addition, Croatia and Macedonia have applied to join, with Croatia in particular hoping to accelerate the pre-accession process.

The EU’s offi cial policy is ‘to welcome any European state which wishes to join’.1 Beyond that, the Union’s institutions take a decidedly lofty view of the process of enlargement, describing it as having ‘an unprecedented political, historical and moral dimension’. The spread of the Union is seen as akin to an evangelical episode which will ‘(bring) our continent together. We are moving from division to unity, from a propensity for confl ict to stability, and from economic inequality to better life-chances in the different parts of Europe.’ Before this can happen, however, a number of problems, acknowledged (though with rather different emphases and conclusions) on all sides, must be overcome.2

Integrationists worry that larger will inevitably mean shallower, that a Union of 25 or more member states will end up as nothing more than a free trade area marred by endless wrangling, with all possibility of ‘progress’ stalled by the diffi culty of fi nding agreement on anything but the most general level. Greens and those on the left, on the other hand, are concerned by the fact that accession negotiations relegated social and environmental questions to a secondary role.3

43



Institutional matters have also presented difficulties. The question of the balance of power between states, of just how much acknowledgement should be given to national independence and sovereignty and how much to the realities of population size – in other words, how much majority voting should there be and what should constitute a ‘majority’ – is potentially explosive. Larger countries resent the disproportionate voting strengths given to smaller member states, while the latter fear domination by the giants. The gap between the biggest member state – Germany – and the smallest – now Malta – as well as that between the richest members and the poorest widened considerably with the latest enlargement. Even if all of the resultant problems are successfully addressed, the task remains of making the institutional structure devised at Nice – or that laid down in the Constitution, should this be approved – function, and in a way which gives at least the appearance of being democratic. The European Parliament had serious problems working in eleven languages. It is too early to say how it will adapt to the problems presented by attempting to do so in 20.4

THE MASS ACCESSION OF MAY 2004

The entry of ten countries on May Day 2004 transformed the nature of the European Union, moving its centre of gravity eastwards, signifi cantly lowering its per capita income, and raising in the process a host of questions relating to policy areas which will be dealt with in the following chapters. Before this unprecedented enlargement it was possible to treat the questions related to the admission of new member states as an issue which could, to an extent, be discussed separately to other great questions of policy dividing opinion in the Union. From the moment it became clear that the locomotive of enlargement would not be derailed, however – to employ one of the transport-based metaphors of which integrationists are so fond – all EU policy discussion has perforce taken place within its framework.

Of the ten new member states, seven were, either as independent countries or parts of greater entities, previously counted in the Soviet or ‘eastern’ bloc, militarily allied to the Soviet Union through the Warsaw Pact. These countries – the Czech Republic, Estonia, Hungary, Latvia, Lithuania, Poland and Slovakia – varied hugely, however, in terms of size, wealth, economic base and culture. Slovenia, which had been the most prosperous federal state of the former Yugoslavia, and the two Mediterranean islands of Cyprus and Malta, made up


Enlargement 45

the ten. The average GDP per head of the new member states was only 40 per cent of the average level in the EU15, while variations within the group were also wide. Cyprus and Slovenia, with 70 per cent or more of average EU wealth levels, were the richest, though they were still signifi cantly poorer than the poorest of the 15, while Latvia, at little more than 35 per cent, could be classifi ed under the euphemism ‘developing country’. Together the ten brought the total population of the European Union up to 450 million, an increase of some 20 per cent, making it, in terms of population, the largest single economic market in the world.

The standard explanation for this enlargement is that the collapse of the Soviet Union and the end of the Cold War presented Europe with a historic opportunity to bring not just the east–west divide, but all historic divisions, to an end. Left to their own devices to overcome the legacy of a failed economic and repressive socio-political system, the countries of central and eastern Europe would become dangerously unstable, prey to extreme forms of nationalism which might become warlike. In partnership with the dynamic, successful economies of the west, they could be brought up to twenty-fi rst-century standards of prosperity – just as had happened to Spain, Portugal and Ireland. This would be accompanied by a growing taste for liberty which, spreading through the population, would consign the atavisms of nationalist extremism to an irrelevant fringe. There would be jobs for all as economic growth brought new opportunities and stimulated the long-repressed entrepreneurial drive of the people, feeding the imaginations and creativity of a rising generation. The prospect – and indeed the conditions – of membership had already led to political and economic reform which was beginning to bear fruit in the form of inward investment, economic growth and visible prosperity.5

Not everyone accepts this sanguine view. They point to a number of factors which suggest that less worthy motives for welcoming the post-socialist countries may be at work, and that even if one were to accept that the motives themselves may be praiseworthy, the EU has simply failed to put its money where it loudly proclaims its heart to be. The initial announcement, at the Copenhagen Summit of June 1993, that these countries were entitled to see their future as being within a united Europe, was followed not by an anticipatory upsurge of prosperity but, on the contrary, by a continuing economic decline that condemned an ever-growing section of the population to poverty and marginalisation. There was much talk of a new ‘Marshall Plan’, but it remained just that, talk. Instead of such a plan,



under which public funds would attempt to create the conditions – through, for example, development of physical infrastructure and education and training of the workforce – necessary to attract private investment, private capital was expected to take the lead. Public moneys invested through the EU’s Phare programme, the European Bank for Reconstruction and Development, the European Investment Bank and a range of smaller initiatives never amounted to more than 6 per cent of the total EU budget, a very small proportion when you consider that enlargement added 20 per cent to the total population and that this new 20 per cent was considerably poorer, on average, than was the citizen of the old EU of 15 countries. Despite the fact that ten countries were admitted as opposed to the six foreseen at the Berlin Summit of June 1999, the ceiling on expenditure agreed in Berlin was not adjusted. This means that from 2004 to 2006, spending as a result of enlargement must be limited to €28 billion. The bulk of this will go on agriculture, with the rest to be spent on rural and regional development, adaptation to Community law across a range of policy areas, administrative costs associated with the accession process, and infrastructural improvements including, where appropriate, upgrading the safety specifi cations of nuclear plant.

Some aspects of the fi nancial treatment of the new member states are extremely controversial. In farm spending, for instance, these countries will suffer a decade of discrimination, not gaining full access to CAP-related payments until 2013. Initially, central and eastern European farmers will receive a total of only 25 per cent of the moneys available in direct payments to those whose land lies further west, rising thereafter by increments. Regional aid will also be limited, in this case amounting to only 55 per cent of the level of entitlement were the rules to be evenly applied. Such fi gures, as well as the fact that the old member states were given the right to exclude, for a limited time, migrant workers from the newly acceded countries, suggest that idealism ends at the point where the bills start to come in.

It is clear, therefore, that if we are to explain the headlong rush into enlargement, or the decision, at the Copenhagen summit, to go for what came to be called the ‘big bang’ – the admission of a large number of new member states at once – we need to look elsewhere than to the unlikely professions of political leaders not usually noted for their starry-eyed idealism. The Balkan War undoubtedly played a role, provoking fears for both the broader region’s stability and the possibility of a huge growth in American infl uence in what was


Enlargement 47

seen as the EU’s ‘natural’ territory. This, as much as their propaganda value, explains why the ‘Copenhagen Criteria’, the conditions which applicants for membership must meet, included political and human rights demands as well as those related to the strictly economic business of the EU’s core agenda. Without the type of institutions found in the existing member states – parliamentary democracy, a degree of freedom of expression and from arbitrary arrest – it was understood that newly-implanted market economies would be unlikely to recover from the distortions which accompanied their birth. For the political elites of the accession countries themselves, though some had gained power or infl uence through precisely the kind of corruption and underhand methods which the Copenhagen Criteria were in part designed to address, enlargement held the promise of stability and prosperity, if only for themselves and their friends. For these people, and their political supporters, the promise has been partly fulfi lled, as impending EU membership certainly stimulated certain areas of the economy, promoting the emergence of a middle class and offering to a signifi cant minority – including the young, the fi t and the well-educated – the opportunity to embrace the ‘western’ lifestyle they craved. While much of the region languished in economic stagnation or decline, and overall rates of unemployment remained immensely high, the income-per-head of capital cities such as Prague, Bratislava and Warsaw began to approach the EU average. The potential for explosive social unrest that such divisions bring is obvious, yet the EU seems indifferent. On the other hand, it has shown itself willing to use the power it has to say yea or nay to applications in order to further political ends in the face of corruption and cronyism, as, arguably, when in March 2005 it postponed talks over Croatia’s application because of that country’s failure to deliver a suspected war criminal to the International Criminal Tribunal.6

This may, however, be no more than an appearance, with the real explanation for the EU’s failure to provide adequate fi nancial support for the enlargement process being that they simply had no choice. The levels of public investment which would have been required to offer at least the chance of an even, harmonious development towards a society with a modernised economy, less dependent on agriculture, able to offer the chance of signifi cant material progress to the mass of the population, while guaranteeing stability without repression, were simply unacceptable politically. Even in Germany, where the bulk of the western electorate could at least see the attraction of the end of the national division, the price



of reunifi cation has proved too much for many to swallow. On the European level, where, whatever the integrationists would like to believe, unity has none of the romantic resonance which it may have within a divided nation, the western electorate wanted concrete results. As none could be offered, they were simply not consulted, and the EU’s politicians and bureaucrats proceeded to their big bang enlargement in the face of the indifference of the majority and the outright hostility of a growing and vociferous minority. This was a dangerous game indeed, but its dangers are perhaps less visible within the increasingly cloistered, even barricaded halls of European governance than they are on the streets outside.

Enlargement also provoked fears in the ‘old’ member states that poorly-paid or jobless workers from the east would fl ood into the higher-wage economies of countries now obliged to open the doors to them. There was much talk of the opening of ‘fl oodgates’, ‘swamping’, and so on, and attempts to exploit this from the usual unsavoury political elements of the far right and their fellow travellers in centre-right and, increasingly, centre-left parties. In fact, it was evident from before the mass accession that the predicted fl ood would hardly amount to a trickle. A poll by the EU’s offi cial stats-gatherer Eurobarometer predicted that migration as a direct result of enlargement would amount by 2008 to no more than 1 per cent of the working age population of the new member states over the next fi ve years, around 220,000 people per year. Even these would not for the most part be unskilled workers competing for low-paid jobs, but rather well-qualifi ed people whose loss from the east would be the west’s gain. A study by the EU-funded research body, the European Foundation for the Improvement of Living and Working Conditions, concluded that the biggest danger was the harm which would be done to the new member states by what could amount to a brain drain. For this reason it recommended that the EU increase funding to stimulate growth, thereby offering talented and qualifi ed people the opportunity to fi nd fulfi lling work without having to travel to the other end of the continent to do so.7

Facts, however, play a limited role in political decision-making and the mythological nature of the impending fl ood did not stop most of the EU15 from taking advantage of their right to restrict access to their labour markets. By way of a derogation from the Treaty articles and legislative measures guaranteeing free movement of labour, all bar the UK, Ireland and Sweden announced that, under specially-negotiated provisions, they would bar workers from the new member


Enlargement 49

states. Self-employed people, and those who had already worked under contract for at least twelve months, were exempt from the ban, which also did not affect the right to travel and settle for those of independent means.8

Whatever the rights and wrongs of the big bang enlargement, it failed utterly to capture the imaginations of the peoples of the countries involved. Although every country which held a referendum recorded a majority in favour of accession which ranged from clear (Malta, 54 per cent) to nearly unanimous (Slovakia, 92 per cent), turnouts were in almost all cases low (Hungary was bottom with 46 per cent, Malta again the exception, with 91 per cent) while those in the European Parliamentary elections which followed only weeks after membership was achieved were embarrassing. Despite a rise in turnout in the EU15, in the new member states so few people showed up that they dragged the overall rate down from 1999’s 49 per cent to a new low of 46 per cent.

Further enlargements are already in the pipeline. Bulgaria and Romania are supposedly on course for accession in 2007, while Croatia and Macedonia have also submitted offi cial applications. Turkey has not been given a target date, but talks have begun. It has also been made clear to the rest of the Balkans’ countries that they will be encouraged to join as they move towards fulfi lment of the political and economic conditions. Ukraine and Moldova have also recently announced an interest.9

Finally, the three developed countries (leaving aside statelets such as Lichtenstein and San Marino) of Europe which remain outside break out into periodic bouts of ‘should we, shouldn’t we’ fever. Two of them, Norway and Iceland, already voluntarily participate in large sections of the European Union’s economic arrangements through the European Economic Area (EEA). This was originally an arrangement between the European Community and the European Free Trade Area (EFTA), a body which once housed all European developed countries not in the Community but which is now reduced, following the accession of most of them, to Norway, Iceland, Lichenstein and Switzerland, the last of which has declined to participate in the EEA. EEA membership gives ammunition to both sides of the debate, with opponents divided between those who say ‘look how bad it is in the EEA, it will be twice as bad if we become full EU members’ and those who argue that EEA membership offers all the advantages of being in the EU without the loss of sovereignty, while proponents of EU membership take the line that limiting oneself to EEA membership



merely deprives the country of a seat in the Council and its quota of MEPs.

Iceland is now clearly developing a political caste which favours membership, but bearing in mind what happens to your fi sh when you join,10 the policy may not prove suffi ciently popular in a country with a robust democracy. Norway has said ‘no’ more than once, but again there are elite forces which will not rest until the people get the answer right. Finally, Switzerland, though a highly developed country, has such a peculiar economy and such a strong popular-democratic political system that it is diffi cult to see how, in the foreseeable future, its pro-EU elites could pull it off.11


6The Common Foreign and Security Policy

Before Maastricht, the European Community had no real offi cial foreign policy and though foreign ministers of the member states met regularly, they enjoyed no formal supranational powers. With the end of the Cold War, pressures had mounted to abandon the virtual taboo on moves towards a genuinely common foreign policy. Once again, the collapse of the Soviet Union changed everything. Suddenly, the familiar realities of a bipolar world were gone, and there was only one superpower.

There are those who dream that a united Europe might make it two. Some of the political leaders who fl aunt their newly-discovered ‘European’ credentials as if they were marks of a peace-loving internationalism are in fact what used to be called Great Power Chauvinists: in place of an all-conquering France, Germany or Britain they favour a strong multinational Greater Europe, with its own army and a relationship with the United States which would recreate the kind of wary respect with which the nineteenth century Powers eyed each other across the negotiating table.

FROM YUGOSLAVIA TO AMSTERDAM

In the 1990s, as change in Central and Eastern Europe gave way to chaos and war, the argument was increasingly heard that if ‘Europe’ wanted to be taken seriously it must develop an independent capability to respond – politically, diplomatically and ultimately militarily – to crises on its own borders. The break-up of Yugoslavia and the subsequent horrors in Croatia, Bosnia and most recently Kosovo amplifi ed these calls.

The result was Maastricht’s creation of the Second Pillar and the replacement of Political Cooperation by a Common Foreign and Security Policy (CFSP). In the urgent context created by the violent disintegration of Yugoslavia, Amsterdam attempted to go further than this, to bring the dream of a united and assertive ‘Europe’ closer, by extending majority voting in certain areas of foreign policy and, most strikingly perhaps, by providing for the appointment of a High

51



Representative for the CFSP. In 1999, the fi rst appointee to this post, former NATO general secretary Javier Solana Madariaga, the man who had presided over the bombing of Yugoslavia, took offi ce.

In addition, the Amsterdam Treaty provided for the formulation of a common defence force, though not immediately. The Treaty merely empowered the Council to set up such a force should it wish to do so, a decision which must, however, be ratifi ed by every member state. A long-standing but largely moribund defence cooperation organisation, the Western European Union, became, in effect, the military wing of the EU, with responsibility to draw up and put into practice any decisions with defence implications. Offi cial integration of the WEU into the Union could occur, but again only if ratifi ed by all member states.

By deepening the foreign and defence policy role of the EU, Amsterdam sharpened the Union’s military aspects. Its provisions represented a further erosion of the autonomy of the member states, including most disturbingly the four – Austria, Finland, Ireland and Sweden – which had long been neutral. The Treaty made such neutrality diffi cult if not untenable.

It has been argued that the position of neutral member states is protected by Article J7(1) which states that ‘The policy of the Union in accordance with this Article shall not prejudice the specifi c character of the security and defence policy of certain Member States and shall respect the obligations of certain Member States, which see their common defence realised in NATO, under the North Atlantic Treaty, and be compatible with the Common Security and Defence Policy established within that framework.’1 In fact, a careful reading of this Article in the context of the rest of the Treaty demonstrates that it is the latter part of this clause which carries the punch. J7(1) is there to reassure NATO that an emerging EU defence policy will complement, rather than undermine, its own – for which read the US’s – hegemonic role. This is of particular concern to the UK, the second biggest contributor to NATO and the United States’ most reliable European ally, or, if you prefer, lapdog.2

The fact that one of its open aims was to promote the co-ordination of armaments manufacture is a blatant demonstration that the EU’s much-vaunted commitment to peace comes with strings, if not a burning fuse, attached. Recognition of the special, highly political and therefore partly extra-commercial nature of the weapons industry had been under pressure for some time before Amsterdam. Demand for change came both from outright militarists and from those who


The Common Foreign and Security Policy 53

could not bear to see such an important sector (it has been estimated to employ around 800,000 people and to contribute between 2 per cent and 2.5 per cent of the EU’s total GDP) treated as anything other than just another industry. And as just another industry, its major problem was maintaining competitiveness in the face of growing competition from the United States, Japan and elsewhere. As then-Industry Commissioner Martin Bangemann said shortly before the Amsterdam Summit: ‘The fragmented nature of the European defence industry clearly gives it a competitive disadvantage.’3

Amsterdam changed the institutional balance of power, allowing ‘the Union’ and not the Maastricht formulation’s ‘Union and its Member States’ to ‘defi ne and implement a common foreign and security policy’. In addition, the Treaty states that ‘the European Council shall defi ne the principles of and general guidelines for the CFSP, including for matters with defence implications’ (author’s italics). The post-Amsterdam CFSP includes the ‘progressive’ (instead of Maastricht’s ‘eventual’) framing of a common defence policy, ‘in accordance’ with the Western European Union (WEU).4

Moreover, Amsterdam integrated the WEU’s responsibility for ‘humanitarian and rescue tasks, peacekeeping tasks and tasks of combat forces in crisis management, including peacemaking’ – known as the Petersberg tasks after the place where they were originally formulated – into the EU. While the Petersberg tasks may well include worthy and genuinely humanitarian missions, their defi nition is so wide and vague as to allow almost anything, including any form of armed intervention.5

In case anyone was left in any doubt as to what was intended, the 15 heads of state and government, together with the President of the European Commission, responded to the Kosovo crisis and subsequent NATO bombardment by declaring, at a European Council meeting held in June 1999, that ‘the Union must have the capacity for autonomous action, backed up by credible military forces, the means to decide to use them, and a readiness to do so, in order to respond to international crises without prejudice to action by NATO’. Such actions would include, but not be limited to humanitarian and rescue missions, crisis management, and ‘peacemaking’; and they would not be limited either to the EU’s own territory nor to its immediate neighbours, as has since, through many offi cial statements, become clear.6



HOW THE CFSP WORKS

The Common Foreign and Security Policy (CFSP) is governed by the provisions of Title V of the Treaty on European Union. The Maastricht Treaty established a three-pillar structure, and Title V constitutes one of the three ‘pillars’ of the European Union, the others being the European Community and Justice and Home Affairs. Decisions were initially by unanimity, and the Commission, Parliament and ECJ had no competence. Since Amsterdam, however, measures may be adopted by QMV. A state may register a ‘constructive abstention’, which may include opting out of the action or policy decided upon; or it can use the power of veto, in which case the matter may be referred to the European Council if the member states decide by QMV that they wish to do so. The Commission now has a limited role, mainly in policy implementation.

The European Council is also empowered to defi ne a ‘Common Strategy’ governing the CFSP approach of the Union in regard to a particular problem. Once a Common Strategy has been defi ned, it is implemented by the Council of Ministers which is able to take decisions under it using QMV.

The Council is assisted by a Political and Security Committee and by a High Representative for the CFSP who may also speak for the EU itself if asked to do so by the Presidency country. The High Representative is in turn assisted by a Planning and Early Warning Unit. The Unit’s tasks are to

• monitor developments in areas relevant to the CFSP• provide assessments of the Union’s foreign and security policy

interests and identify areas on which the CFSP should focus• provide timely assessments and early warning of events,

potential political crises and situations that might have signifi cant repercussions on the CFSP

• produce reasoned policy option papers for the Council.

The CFSP opens the way for the EU to develop a common defence, including joint armed forces, should the European Council decide it, and it provides for the integration of the WEU – the defence organisation which brings together European NATO members – into the European Union.7


The Common Foreign and Security Policy 55

THE NICE TREATY’S REFORMS AND DEVELOPMENTS SINCE

The Nice Treaty, which entered into force on 1 February 2003, introduced a number of changes. The Council’s ‘special representative’ would henceforth be appointed by QMV, as would agreements with third countries or international organisations, provided these were necessary to a joint action or common position which itself had already been agreed. Established in 2001 but having no offi cial powers until the Nice Treaty’s entry into force, the Political and Security Committee (PSC), composed of senior diplomats acting as national representatives at senior or ambassador level, prepares recommendations on the future functioning of the CFSP and the CFSP aspects of meetings of the General Affairs Councils. In the event of a crisis, it would be responsible for deciding what actions might be taken by the Union in keeping with the division of powers. Astonishingly, given that it is composed of unelected offi cials, the PSC is authorised, under Article 25 of the Nice Treaty, to exercise political control and strategic direction of a crisis management operation.8

Since Nice, the now 25 EU member states have underlined the fact that employment of the military capabilities at their disposal shall not be limited to actions within the Union’s own territory, offi cially committing themselves to be able to respond to crises throughout the world by 2010. Meeting in Brussels just a fortnight after enlargement, defence ministers adopted a security plan entitled ‘Headline Goal 2010’ which begins by stating that ‘The European Union is a global actor, ready to share in the responsibility for global security.’9

The plan commits member states to developing by 2010 the ability to respond to crises throughout the world. Responses might include humanitarian and rescue tasks, crisis-management, peace-keeping and joint disarmament operations. The EU must be able to ‘take the decision to launch an operation within 5 days’ and its forces able to implement such a decision within ten days after such a decision is taken. Member states of this peace-loving Union further committed themselves to developing ‘Battle Groups’ , military units which could be deployed from 2007. Plans for a European Defence Agency were, by the time of this meeting, already well under way, its fi rst task being to identify gaps in hardware and ensure that they were closed.



COMMON (MARKET) VALUES?

The arguments in favour of this militarisation are straightforward. The EU is a strong economic presence in the world, which gives it political interests which must be promoted. Together, the EU and its member states account for more than 50 per cent of both international development aid and humanitarian aid and a third of aid to the Middle East. Enlargement has brought its borders bang up against some rather troubled regions, moreover. Beyond these practical considerations, however, the CFSP is purportedly designed ‘to safeguard the common values, fundamental interests and independence of the Union’.10

As with so many aspects of the European Union, what tends to irritate opponents of the CFSP is the pretence that what is being defended is a common set of values and interests to which all Europeans, and indeed all civilised or decent people, automatically and unquestioningly subscribe. Whether such values can be said to exist at all is a matter of intense philosophical debate and speculation, though never amongst the EU’s ruling elites. That they might include a particular version of the market economy is, to say the least, questionable.

Box 6.1

The Five Offi cial Aims of the CFSP – as Defi ned in the Treaties

• to safeguard the common values, fundamental interests, independence and integrity of the Union in conformity with the principles of the United Nations Charter;

• to strengthen the security of the Union in all ways;• to preserve peace and strengthen international security, in accordance

with the principles of the United Nations Charter, as well as the principles of the Helsinki Final Act and the objectives of the Paris Charter, including those on external borders;

• to promote international co-operation;• to develop and consolidate democracy and the rule of law, and respect

for human rights and fundamental freedoms.11


7Citizenship, Justice and Security

Following Maastricht, anyone holding nationality of an EU member state became automatically a citizen also of the Union. At fi rst sight it might seem that this is, at worst, a symbolic but empty gesture. In fact, the proposal generated much controversy, and for a number of reasons.

Firstly, because it can fairly be cited as substance to the allegation that the EU is on its way to becoming a supranational state. Only states have citizens. Secondly, because the usual idea of citizenship is that it confers rights and obligations. In this case, however, the rights conferred seem negligible and the obligations, though currently non-existent, something of a blank cheque for future use. The widespread feeling that the EU is remote and beyond the control or even infl uence of ordinary people is thus accompanied by a fear that things will be demanded of people – taxes? loyalty? military service? – which they have never agreed to make available and which are properly offered only to their country.

‘European Union citizenship’ is not, in fact, citizenship as usually defi ned. It does confer certain rights, but they are limited and not those normally associated with nationality.

Most importantly, it confers the right to move freely within the territory of the Union, which prior to 1990 was conditional on one’s being economically active (a worker, or employer, or self-employed person) or a close family member of someone who was one of these. The Single European Act sought to abolish frontier controls, but this proved diffi cult to implement. In 1990 the right of residence in a member state other than one’s own was extended to anyone with suffi cient means to support him- or herself. Two years later this right became an aspect of EU citizenship, fi nally divorcing it from economic activity.

Secondly, every national of any member state is entitled, if outside the EU and in a country where his or her nation has no diplomatic representation, to use the embassy and consular services of a member state which does have such facilities. Thirdly, every European Union citizen residing in a member state other than his or her own is entitled

57



to vote in municipal and European Parliament elections under the same conditions as the country’s own nationals.

Finally, the right to petition the European Parliament and to apply to the European Ombudsman is something which has been trumpeted as belonging to the rights of the ‘European Union citizen’. In fact, most people, if they know of the existence of the offi ce of European Ombudsman at all, or have any idea what the holder of the offi ce can do for them, would probably have taken the right to petition for granted, as they no doubt do in the case of the Parliament. Yet this is clearly not a right of citizenship at all. The right to petition has been enjoyed in many parts of Europe since the Middle Ages, even by those (such as women and foreigners) who were denied all other forms of political participation. And sure enough, not to be outdone by mediaeval kings or Estates General, the rules governing the Ombudsman make it quite clear than anyone, citizen or not, legally resident in one of the member states, has the right to use his or her services.1

THE AMSTERDAM TREATY

The Amsterdam Treaty failed to address the embarrassing lack of substance in this concept of Union citizenship. The only genuinely new right it contained was the stipulation that the European Union ‘citizen’ would henceforth be able to write to a range of EU institutions in any of the offi cial languages.

Perhaps as important as anything in the words of the Treaty, however, was the fact that for the fi rst time Amsterdam turned member states’ attention to the existence of widespread dissatisfaction with the EU, as well as a smaller but vociferous opposition from both left and right which grew from and fed off a suspicion and indifference which in some member states was almost ubiquitous. Trade unionists, the left and far left, Greens and other environmentalists, anarchists, and people from a wide variety of causes and groups, gathered on the streets of Europe’s most famously libertarian city. The cosy, closed world of the late-twentieth-century power elite was temporarily disrupted. Dutch police offi cers, previously renowned for their willingness to give you a light (whatever you happened to be smoking) now demonstrated that they were also able to behave in the same unreasonable, bizarre, violent fashion as is normal for their colleagues in many other parts of the world. Reality arrived on the EU’s doorstep, and some vague, distant whiff of it even managed to


Citizenship, Justice and Security 59

seep past the massed ranks of riot police and under the solid doors of the Amsterdam Stadhuis.

The demonstrations, moreover, were the culmination of a long process during which pressure was put on the member state governments and the Commission to offer something more to ordinary people than a fl imsy and irrelevant citizenship. This had involved not only earlier street demos and marches but consultations with trade unions and NGOs about what they wanted to see. The result was a series of ‘compromises’ which established limited new commitments by the EU and its member states.

Much of what had been demanded, however, would have meant further extensions of the EU’s competence into areas which most member states were not prepared to accept. This meant that whilst little new was offered, the Treaty stresses the importance of respect for fundamental rights, especially those guaranteed by the Council of Europe’s European Convention on Human Rights (ECHR). The Preamble of the section of the Amsterdam text known as the European Community Treaty makes reference not only to this Convention but also to the Council of Europe’s 1961 European Social Charter and the 1989 Community Charter of the Fundamental Social Rights of Workers, both of which deal mainly with employees’ rights.2

Whether this had any discernible effects out there in the real world is open to question. According to the Treaty of Amsterdam, the EU has the power to take appropriate action to combat discrimination. Discrimination covers gender, race or ethnic origin, religious and other beliefs, disability, age or sexual orientation. The Commission was required to come up with proposals to give substance to this power, but the result has been many fi ne words and no real advance. Nothing in the Treaty, nor in what has been suggested since, indicates that the member states are willing to cede control over these areas of policy to any kind of supranational institution.

The Court of Justice already enjoys some competence to combat discrimination on the grounds of nationality, which has been illegal since the original Treaty of Rome was signed. The Amsterdam Treaty, however, conveys no power to individuals to bring actions relating to other forms of discrimination before the Court if they do not receive redress from the national courts. The sole possible exception – though Amsterdam left the whole area extremely grey indeed – is the formal power given to the ECJ to ensure respect of ‘fundamental rights and freedoms’ by the EU itself, or its institutions.



There was enough in Amsterdam and in the debate which preceded and followed it, however, to convince decision-makers in the EU and its member states that further steps might be taken to increase the relevance of the Union to ordinary people’s lives – or to take further steps towards a superstate with its own supranational constitution. Both views are represented at the highest levels, and many leading politicians and offi cials are themselves unclear about the difference, or undecided over which course to take.

The next step, whatever its motives, was a declaration by the European Council at the Cologne Summit of June 1999, of the need to establish an EU Charter of Fundamental Rights.3

THE CHARTER OF FUNDAMENTAL RIGHTS

The resulting Charter contains no rights which are not enjoyed by the citizens of the EU’s member states under national law and international agreements such as the Council of Europe’s Convention for the Protection of Human Rights and Fundamental Freedoms and the Conventions of the International Labour Organisation. By its own account, the Charter merely establishes the rights which already exist on the basis of the common constitutional traditions and international obligations of the member states. Article 51 of the Charter states specifi cally that it ‘creates no new competences or tasks for the Community or the Union.’

The language of the Charter is often vague to the point of meaninglessness. For example, under Article 38, Consumer Protection, we read that ‘Union policies shall guarantee a high level of consumer protection.’ What a ‘high level’ constitutes is, of course, a matter of opinion. Moreover, the only way consumers can be protected is through strong laws backed up by rigorous enforcement. Such laws exist to one degree or another in all member states. They are backed up by a body of EU consumer protection measures, some of which are useful, especially when it comes to protecting the rights of those buying goods and services outside their own countries. Enforcement is much patchier and more problematic. Article 38 will do nothing to address this problem.

The Charter is full of such pious declarations. Article 25 on the Rights of Older People states that ‘The Union recognises and respects the rights of the elderly to lead a life of dignity and independence and to participate in social and cultural life.’ Of course, this is only achievable by those who enjoy a reasonable income, which for almost



all retired people means a decent pension. Pensions are entirely in the control of national authorities and the Charter has nothing to say about them.

The essential dishonesty of the whole Charter exercise is revealed whenever any potentially controversial matter is dealt with, in particular anything touching on the rights of employees. Article 27 states that ‘Workers or their representatives must, at the appropriate levels, be guaranteed information and consultation in good time in the cases and under the conditions provided for by Community law and national laws and practices.’ This is a statement that is breathtakingly free of content. All it says is that the law must be obeyed, something most people over about four years old are already aware of. In countries where workers have traditionally no right to consultation or information, such as the UK, the Article indicates only that national authorities should enforce EU law. Where rights appear to be guaranteed by the Charter, the qualifying phrase is invariably added: the only rights you really have are those guaranteed by national laws and practices.

Such being the case, we are entitled to ask what such an apparently worthless document is actually for. There are two possible answers. Either it is a propaganda exercise to bolster the image of an increasingly unpopular European Union; or it is a deliberate step on the road to a superstate, the seed of a new ‘European’ constitution. Resistance from numerous member states, including Britain, to any idea that the Charter should be legally binding demonstrated that it is not only those who oppose (or are ‘sceptical’ of) the European Union who perceive the danger of this. The result, however, is that the precise legal status of the Charter remains, six years on from its signing, unresolved.4

One might have expected the Constitutional Treaty, had it been accepted – or were it now to be accepted in some amended form – to resolve these questions, as it reproduced the Charter’s content. However, the legal status of this guarantee of rights was itself unclear, and as the relevant Article, like the Charter, offered no rights not already possessed, and was hemmed in with all sorts of qualifying phrases, this in fact provided no resolution. The conclusion must remain that this was no more than a propaganda exercise, a sweetener for the unpalatable neoliberal pill which formed much of the rest of the proposed new Treaty’s content.5



THE CITIZEN, JUSTICE AND HOME AFFAIRS

Maastricht placed earlier informal co-operation in the fi eld of justice and home affairs on a proper legal footing, albeit one which bypassed the institutions of the European Community in favour of a state-to-state approach known as the ‘Third Pillar of the European Union’. The Third Pillar applied to nine areas of what was defi ned as ‘common interest’. These were asylum policy, rules governing physical entry to and exit from the Union, immigration, combating drug addiction, fraud on an international scale, judicial co-operation in civil and criminal matters respectively, customs co-operation, and police co-operation to prevent terrorism, drug traffi cking and other serious forms of international crime, this last to include the organisation of a system for exchanging information within a European Police Offi ce to be known as Europol. There was much here to set off civil liberties alarm bells, particularly as the European Parliament was excluded from the decision-making procedure.

In an attempt to respond to this criticism, though the Amsterdam Treaty did not get rid of the three-pillar structure, it did move much of the Third Pillar into the jurisdiction of the EU institutions. What remained were police and judicial cooperation on criminal matters, leaving the planned Europol again outside any visible democratic control.

On the back of these developments the Council and Commission together produced, in 1998, an action plan on the best way to implement Amsterdam’s provisions on what the Treaty termed ‘the area of freedom, security and justice’. The plan envisaged the incorporation of the Schengen system, an agreement between the majority of member states aimed at establishing freedom of movement between them, into the EU’s normal framework, and drew up a timetable regarding free movement of persons, combating traffi cking in people and other organised crime, the development of Europol and closer judicial co-operation.6

The incorporation of the Schengen system and the general extension of EU powers in the area of civil liberties was widely criticised, above all by people concerned that such democratic control of police and courts as existed in the member states would be weakened or bypassed. Whilst Europol would clearly be under no effective control by national courts, for example, the European Court of Justice was given no powers either to hear individual civil



liberties complaints or to exercise any general jurisdiction over the behaviour of police or other law enforcement bodies.

Europol’s extensive data collecting powers include the right to collect information on known and suspected criminals, but also on anyone ‘presumed’ to be planning to commit a crime and even on potential victims or witnesses, and this data may refer to such irrelevant considerations as racial origin, religious observation, political beliefs, sexuality and health.

This spooks’ charter is reinforced by the fact that the border-hopping cops’ investigative and operational powers appear immune to scrutiny by any democratically elected or otherwise answerable body, whether at national or EU level. The European Parliament is referred to several times in the relevant Article of the Amsterdam Treaty, but it is given no power, merely the right to express its views and have them taken into account, hold an annual debate on developments, and ask questions. National Parliaments have only the power to request that their governments issue particular instructions to their representatives on Europol’s management board, the body which runs it under the supervision of those governments. Even if the request is respected, however, it can be overruled, as the management board operates on the basis of majority voting.7

If the citizens of the EU’s member states think they have problems, spare a thought for those people merely resident, or attempting to become so. The Treaties have little to say about the rights of resident non-citizens, but a great deal about control of refugee and asylum policy, as well as immigration in general. Provisions in the Amsterdam Treaty have been criticised not only by left and anti-racist groups, but by Amnesty International, the United Nations High Commission for Refugees (UNHCR), the Quakers and a number of NGOs about the provisions concerning asylum and refugees. According to these critics, the Treaty violates the convention on refugees which every member state has signed.8

Despite the fact that all member states are signatories to the 1951 Geneva Convention on Refugees, the Treaty confl icts with it at a number of points. Its defi nition of ‘refugee’, for example, is much narrower, excluding people persecuted by groups not enjoying, or answering to those who enjoy, state power. In an era in which many states have imploded, or when those defi ned as state authorities may be no more than one of a number of rival groups temporarily in control of the state apparatus, this is clearly an irresponsible erosion of the accepted meaning of the instrument for the international



protection of refugees. The Dublin Convention of 1998, an agreement between the member states over implementation of refugee and asylum policy, has met similar criticisms.9

Taken together, these various measures clearly demonstrate that the European Union’s commitment to ‘Fundamental Rights’ is not only empty, as can be seen from a simple analysis of the new Charter, it is, in fact, directly contradicted by its actions in the sensitive fi elds of international policing, asylum and migration. The constant erosion of the powers of democratically elected bodies, the deliberate removal of the security apparatus from any form of popular control, and the blurring of the line between suspicion and guilt, all point to worrying tendencies amongst those who are leading the real, existing process of integration, rather than the one we are constantly assured is bringing us all ever nearer to a borderless, peaceful, internationalist future. When the ‘War on Terrorism’ was declared, and the United States administration under George W. Bush began to convert solid rights into conditional privileges, the European Union had already equipped itself with a framework which would make the building of a thoroughgoing security state possible.

AFTER 9/11

Numerous developments in the European Union’s approach to security are now of extreme concern to those seeking to defend civil liberties and human rights from arbitrary violation by states and their servants. As I have indicated above, these were already becoming visible before 9/11, though there is no doubt that they have been greatly accelerated by that event, as well as by the Madrid bombing of 2004, those in London in 2005 and the continuing wars in not-so-distant Iraq and Palestine. It is easily forgotten, however, that Europe has, overall, a greatly reduced incidence of terrorism when compared to periods in the quite recent past when the UK, Ireland, France, Spain, Italy, Greece, Belgium and Germany all suffered persistent politically-motivated and extra-judicial violence from people identi-fying themselves with left, right, nationalistic and religious causes.

It is hard to escape the conclusion that what has changed is not so much the size of the threat of violence, but the degree to which the state, and the collective of states which is the EU, is willing to tolerate organised dissent, as well as what it defi nes as ‘disorder’. What have long, in most EU countries, at least of the pre-May 2004 15, been seen as rights, are now being redefi ned as privileges which



must be given up, on occasions, for the greater good. The fi rst of these is the right to privacy.

At the end of 2004, for example, the Council, under a legislative procedure which gave the Parliament no more than the right to be consulted, approved – and indeed required – the use of biometrics in passports and visas.10 Strong standards of data protection would answer some of the concerns about biometrics, but these are extremely diffi cult to ensure across borders – you might, just might, be able to do something about it if you discover that your local police force is illegally storing data on you, but what if this is happening a thousand miles away, and in a language unknown to you? It is, moreover, somewhat discouraging to know that the EU, under pressure from the US, has signed since 2002 a series of international agreements undermining the principles of its own laws – the 1995 and 1997 Directives on data protection and telecommunications privacy – which had been regarded positively even by civil rights activists. The Europol–US agreement and the EU–US agreements on extradition and judicial cooperation, contain several features which breach the earlier directives, most notably allowing US authorities access to the names and other details of all passengers on Transatlantic fl ights. In addition, agreements with other countries as well as international organisations allow the supply of data to various authorities – the World Customs Organisation, for example – data to which the individuals cited have no access and the accuracy of which they have therefore no means of challenging.11

A further cause for concern is the Schengen Information System, the SIS. Again, data may be stored on individuals, data which may lead to their exclusion from the Schengen area, in a form which they can neither access nor challenge and, indeed, in a language which they may be unable to understand. The system was established in 2001, but there was an immediate perception on the part of the authorities that it was inadequate, and that it would become more so on enlargement. This led to the development of what came to be called SIS II, which gave access to the system not only to the ten accession countries but to the UK and Ireland, which did not participate in the Schengen system itself. SIS II extended the system in other ways, too, allowing biometric identifi cation data, creating new categories of undesirables – ‘terrorist suspects’ and ‘violent troublemakers’ – and more sophisticated cross-referencing. In addition, a wholly new Visa Information System (VIS) will contain personal information



supplied by non-EU citizens making visa applications to member states every year.12

One of the purposes of the creation of the ‘violent troublemakers’ category is to enable police to prevent named individuals from travelling to events seen as linked to the possibility of violent affray, principally football matches and political demonstrations. While football fans’ civil rights are as important as anyone else’s, the potential for using the excuse of possible violent disorder to curtail the democratic right to demonstrate in favour or against a political goal is even more worrying. Police forces have been developing a perspective and practices in relation to international co-operation in the face of mass, international demonstrations since the Amsterdam Summit brought tens of thousands on to the streets to protest the increasingly evident stranglehold on the European level of politics by neoliberal ideologues. Every major summit since has been accompanied by marches, counter-summits and other forms of protest. Violence has been rare, and evidence of police provocation has always emerged in its wake. Nevertheless, the response of the political elite is not to reform the police forces of the member states, but to increase and legitimise the surveillance of participant groups and individuals, to allow member states to establish border controls and refuse entry to people whom there is no reason to suspect of anything other than the intention to exercise their right peacefully to demonstrate, and to develop paramilitary police forces whose commitment to the democratic rights of peaceable citizens is, to say the least, questionable.

When the European Commission issued further proposals which would make it possible for police forces to exchange data concerning any type of criminal record – a proposal which would require an enormous change in existing UK laws – it was criticised by the EU’s own data protection watchdog as ‘not proportional’ to the problem it sought to solve. It should instead, the European Data Protection Supervisor said ‘be limited to specifi c serious crimes and should provide precise safeguards to the data subject’.13

Finally, the listing of individuals and organisations as ‘terrorist’, without recourse to appeal and on evidence which comes entirely from state security forces, is clearly open to abuse.

There are serious concerns, in addition, about the rights of non-citizens, especially those who arrive seeking asylum and see their applications rejected. A number of deaths and serious injuries have occurred during forced repatriations, there is considerable evidence



that repatriations deemed ‘voluntary’ are often agreed to only under coercion, and the standards for assessing whether someone is a ‘genuine’ refugee, one who might suffer victimisation if forced (or persuaded) to return home appear to be tightening. Readmission agreements, designed to avoid a situation in which the country to which a refused applicant is to be deported will not admit the individual involved, are foisted on developing countries using various trade-and-aid related carrots and sticks. Racist behaviour by police and immigration offi cers and others in authority is commonplace, as can be seen by anyone undertaking a cross-border journey in Europe. There are currently proposals, moreover, to establish ‘external asylum processing centres’, a thin euphemism for camps in a non-EU country where all applicants for asylum would be held. This would breach the Geneva Convention on Refugees, but many member states, including the UK, now routinely breach this treaty, and with apparent impunity, in their treatment of asylum seekers within their borders.

Behind all of this, or so it increasingly appears, lies an assumption, unjustifi ed by any real upsurge of political violence in Europe, or any real ‘fl ood’ of refugees or asylum seekers, that people crossing borders are a problem, and that they are guilty unless they can prove otherwise, especially if their skin is brown or black. Such developments give the expression ‘area of freedom and security’ of which the EU authorities are so fond a hollow, even Orwellian ring.14


8Monetary Policy

The euro, the EU’s long-projected single currency, was introduced at the beginning of 2002. All EU member states bar the UK, Sweden and Denmark took part. The proposal had already been rejected in a referendum by the people of the two Scandinavian countries, while the UK electorate had been promised a referendum when the government decided that fi ve tests must be met before membership could be considered. Devised by Chancellor of the Exchequer Gordon Brown, these tests were as follows:

• Can Britain’s economy run in sync with the euro-zone long term?

• Will joining the euro affect our fl exible labour market?• Will it make unemployment worse?• Will it affect our world beating fi nancial services industry?• Will it stop foreign fi rms investing in Britain?

The persistent media consensus was that, despite some progress, these tests were not being met.1 However, because they are interpretative rather than relying on hard statistically-based data, they have been heavily criticised as having been designed to allow the government to choose its moment. As a referendum has been promised, that moment is likely to have much more to do with the government’s anticipation of getting the result it wants – which, while Labour remains in power, will mean a ‘yes’ – than it will with a set of questions to which people of different political views can clearly give different answers.

THE CONVERGENCE CRITERIA AND THE GROWTH AND STABILITY PACT

Like the whole of the integrationist project, European Monetary Union (EMU) is politics masquerading as economics. Whatever other motives may lie behind the creation of a single currency or incidental advantages it may have, the euro’s primary purpose is to narrow the room for manoeuvre enjoyed by elected governments. As Chancellor

68


Monetary Policy 69

Helmut Kohl put it in a speech to the Council of Europe in 1995, ‘We want the political unifi cation of Europe. If there is no Monetary Union there cannot be Political Union and vice versa.’2

The political motivations of the project are evident if we examine the convergence criteria. These are the rules, laid down at Maastricht and incorporated in the Treaty on European Union, which must be followed if a nation wishes its currency to qualify for full membership of EMU. The criteria are as follows:

Annual average inflation may not exceed by more than 1.5 percentage points the level ‘in the three best performing member states in terms of price stability’.

The level of annual average long term interest rates may not exceed by more than 2 percentage points the level ‘in the three best performing member states in terms of price stability’.

The government defi cit (total public sector) may not exceed 3.0 per cent of Gross Domestic Product (GDP), or should be falling substantially, or be only temporarily above, though still close to, this level.

Gross government debt may not exceed 60 per cent of GDP, or must show at least a satisfactory reduction towards this fi gure. A reduction in the debt ratio of 2 per cent of GDP annually would normally be satisfactory.

What is it about these rather dry-sounding criteria which makes the euro such a transparently political project? Quite simply, they are designed to reduce the choices available to member state governments, so that whatever goals they wish to pursue must be achieved within the confi nes of a highly liberalised market economy. The real arguments for the euro are the same, then, as the arguments for such an economy, but they are rarely, at least for broad public consumption, presented as such. Traditionally, national authorities had a wide range of economic and political choice. In democracies, elections are held as a means whereby the people can determine (or at least infl uence) such choice. Where this is not the case, elections cease to have a great deal of meaning.

Governments have generally responded to economic diffi culties, for example, by employing such means as currency devaluation, which can stimulate demand for exports and suppress demand for imports. They can lower interest rates in an attempt to encourage economic activity. They can borrow money and invest it in an economically benefi cial way, by improving infrastructure or education, or directly creating jobs.



If none of these things is available, there remains only labour mobility: in good times workers will move in, in bad times they will seek work elsewhere. This, however, simply does not happen in the European Union. People do not cross borders to look for work. Despite the existence of long-standing communities from the Mediterranean in the rich cities of the north, under 1 per cent of the working population of Denmark, Finland, and around 3 per cent in France, Germany and the Netherlands consists of EU citizens from outside the country. In every member state, moreover, foreign workers from outside the EU greatly outnumber those from within its borders. The fl ood of workers from the new member states, predicted though it was by politicians, tabloid rags and bar-room bores, never materialised, though it is logical to assume that the incorporation of a number of states which previously supplied immigrant workers who were not then EU citizens will indeed shift the balance of non-EU to EU immigrants in the richer member states of the north and west. There is no sign, despite much breathless talk of our all being Europeans, and the stated views of a majority of EU enterprises that they would welcome greater mobility, of its rate increasing. Indeed, the European Commission’s report on the implementation of its own ‘Action Plan for Skills and Mobility’ admitted that it was falling.3

Monetary union either abolishes the traditional powers developed by national government or greatly restricts them. In effect, they are handed over to a constitutionally independent, unelected and therefore unaccountable European Central Bank. The question then becomes this: are the advantages of monetary union so great that they justify this loss of democratic control?

Since the establishment of the euro, the EU in general has hovered on the brink of recession, and while this may not be directly attributable to the euro’s introduction, it has also clearly done nothing to prevent it. Moreover, the Growth and Stability Pact, which purportedly makes the convergence criteria obligatory for eurozone members, was openly and repeatedly defi ed by both France and Germany as economic growth dwindled away and discontented workers took to the streets to force their governments to abandon, or at least scale down, deep cuts in social spending.4

This led, in March 2005, to reform of the Pact. The 3 per cent limit on defi cits would be offi cially maintained, but member states would be given more leeway to exceed it in special circumstances. Smaller countries, worried about the possibly infl ationary results of French and German laxity, were unhappy, but the big countries, as usual,


Monetary Policy 71

got their way. The argument that a period of economic slowdown requires a more subtle approach to limits on public spending is a powerful one, having the merit of truth. Yet no one drew the obvious conclusion that the whole basis of the Growth and Stability Pact is misguided and should be rethought.5

The fact that successive British governments have for over a quarter of a century followed precisely the kind of policies which the single currency is designed to encourage may make it seem surprising that the UK has repeatedly declined to adopt it. However, aspects of Britain’s economic life and even of its culture would mean that the country would have particular problems related to monetary union. It is perception of these problems, rather than the sort of atavistic fl ag-waving popular amongst the currency’s opponents on the right, which might lead to opposition to entry which goes way beyond the section of the electorate which votes for UKIP.

As individuals, private citizen Britons are more directly affected by interest movements than is usual in other parts of the EU, largely as a result of the fact that houses are bought on mortgages by people further down the economic ladder than would be normal elsewhere. Household indebtedness is therefore very much the norm, having risen in the fi rst fi ve years of this century from an estimated 95 per cent of post-tax annual income to 125 per cent. ‘Secured debt’, which is overwhelmingly accounted for by mortgages on dwellings, increased by only slightly less over roughly the same period, and has almost tripled since 1980. If interest rates rise and you lose your job, you may be unaware of the connection, preferring to believe that it was bad luck, or bad management by your employers. If interest rates rise and your mortgage repayments go up, however, the connection is obvious even to that vast majority of people which fi nds economics less than gripping.6

The initial weakness of the euro – it fell for some time below dollar parity – was ridiculed by opponents, but its subsequent huge rise against the dollar brings its own problems, for a strong currency increases the price of European goods and services on the world market. The point, however, is that the weakness or strength of a currency is something which governments have traditionally, and sometimes successfully, sought to manipulate in order to pursue particular policy goals. The single currency means that one size must fi t all: if Germany has a strong currency, then so must Portugal; if Austria has high interest rates, then so must Ireland; and if the ECB



is obliged by Treaty to prioritise low infl ation, then so must everyone else.

The strong currency has helped to fuel the Europhile dream of having a world currency to rival the dollar. As radical political commentator Michel Chossudovsky has argued, since the euro’s establishment ‘two rival fi nancial and monetary systems are competing worldwide for the control over money creation and credit.’ It is too early to say what will emerge from this, but it is clear that the strong euro is at least partly a result of the European political-fi nancial elite’s willingness to sacrifi ce the interests of ordinary Europeans, which are ill-served by high exchange rates, to their own geo-political ambitions.7

In the end, though, opponents, in common with supporters, must come clean and talk about politics, not economics. EMU abolishes the right of elected parliaments, governments and institutions directly answerable to them to exercise control over macro-economic policy. It hands it instead to a group of people drawn from the elite of a single profession. This group contains almost no women, no people of colour, no trade unionists, no small business people or farmers. It is constitutionally ‘independent’ – a positive-sounding word which is always used to describe the European Central Bank but for some reason rarely applied to other dictatorships. Whatever economic advantages it may or may not have, the single currency as prescribed in the Maastricht Treaty abolished, in one extremely clever stroke, the tiresome infl uence of popular, democratic institutions on macro-economic policy, a matter now far too important for anything so frivolous to be allowed to intrude.

Box 8.1

Monetary Union

After an initial stage lasting from 1 July 1990 to 31 December 1993, during which the single market would be completed and economic coordination reinforced, a second stage, from 1 January 1994 to 31 December 1998, saw the establishment of the European Monetary Institute (EMI) to assist member states in co-ordinating policies, to prepare the fi nal stage of monetary union, including the establishment of the European System of Central Banks (ESCB), and to oversee the development of the European Currency Unit (ECU), the notional currency which preceded the euro. It also obliged member states to

• render their central banks independent of the political authorities;


Monetary Policy 73

• discontinue their overdraft facilities with their central banks and their privileged access to fi nancial institutions;

• endeavour to fulfi l the following fi ve convergence criteria:

1. an average rate of infl ation that does not exceed by more than 1.5 percentage points that of the three best performing Member States during the year preceding the third stage;

2. a budgetary defi cit not exceeding 3 per cent of GDP, or close to that level, provided that it has declined continuously;

3. government debt not exceeding 60 per cent of GDP, or close to that level owing to a sharply diminishing trend;

4. a long-term interest rate that does not exceed by more than 2 per cent the average of the three best-performing member states in terms of price stability;

5. maintenance of the national currency within the normal fl uctuation margins of the European Monetary System for at least two years, without devaluation.

The third and fi nal stage was fi xed by the European Council, which decided that it would begin on 1 January 1999 and that the initial participating nations would be Austria, Belgium, Germany, Luxembourg, the Netherlands, Spain, Portugal, Italy, Ireland, France, and Finland.

Third stage (1 January 1999 – 1 July 2002)

• The establishment of the European System of Central Banks (ESCB) and the European Central Bank (ECB).

• Introduction of the euro:

On 1 January 1999:

– the parities of the participating currencies and their rates of conversion into euros irrevocably fi xed; the amounts expressed in national currencies in contracts converted into euros;

– the euro became a currency in its own right (but no coins or notes issued until 1 January 2002);

– member states’ monetary policy and exchange rate policy carried out, and new public sector debt instruments issued, in euros;

– the ESCB and national and Community public authorities to oversee and assist with changeover;



– on 1 January 2002 at the latest, euro banknotes and coins were put into circulation alongside national currency notes and coins, which were quickly withdrawn, though the exact pace of this withdrawal was left to the member states, provided it was achieved by by July 2002

• Coordination of economic policies under the euro is conducted according to the following system: the Council of Ministers lays down the broad guidelines of the economic policies of the member states and of the Community after reporting to the European Council and taking account of its conclusions. The Council then ensures compliance with these broad guidelines and monitors economic developments in the member states. It monitors excessive public defi cits, and, after the Commission has issued its Opinion, the Council of Ministers decides whether a member state has such a defi cit and recommends measures to be taken by that member state with a view to eliminating it within a specifi ed time-limit. Should the member state fail to adopt such measures, the Council may decide to impose sanctions. This was done in the case of Portugal, while France and Germany went unpunished.

Stability and Growth Pact maintains budgetary discipline indefi nitely:

• by requiring member states participating in monetary union to draw up and submit stability programmes to maintain medium-term budgetary equilibrium,

• by laying down the timetable for implementation, and sanctions under the excessive defi cits procedure.

Box 8.2

Who’s in charge of the euro?

The European Central Bank (ECB) (est. July 1998):

• Directed by an Executive Board comprising a President, Vice-President and two to four other members, all appointed by the EMU member state governments for a non-renewable period of eight years. The Executive Board is responsible for the daily management of the ECB and, in particular, for the implementation of monetary policy on the basis of the decisions of the Governing Council.

• The Governing Council consists of the President and Vice-President of the Executive Board and the Governors of the Central Banks of the


Monetary Policy 75

EMU member countries. It defi nes monetary policy and establishes the necessary guidelines for its implementation. It is thus the ECB’s supreme decision-making body.

• A General Council consisting of the President and Vice-President of the ECB and the Governors of the Central Banks of all the member states of the European Union; prepares for the possible accession of EU member states not already members of the euro-zone.

The ECB has the following tasks:

• to administer the European System of Central Banks;• to address an annual report on the activities of the ESCB and the monetary

policy of both the previous and the current year to the Council, Parliament and Commission.

The European System of Central Banks (ESCB) (est. 1 July 1998) consists of the ECB and the national central banks. It is governed by the decision-making bodies of the ECB and has the following tasks, all of which are carried out with a view to its fundamental responsibility, to maintain price stability:

• to defi ne and implement the single monetary policy;• to conduct foreign-exchange operations arising from the exchange-rate

policy established by the Council;• to hold and manage the foreign reserves of the participating Member

States;• to ensure the smooth operation of payment systems in the euro-area;• to contribute to the smooth conduct of policies relating to the stability

of the fi nancial system;• to authorise the issue of banknotes in the euro-area.

The Economic and Financial Committee has six members, two appointed by the member states, two by the Commission and two by the ECB. Took over most of the functions of the Monetary Committee, which it succeeded on 1 January 1999.

The Euro Council co-ordinates economic policies in the euro-zone. Cannot take decisions independently, however. They must be confi rmed by the EU Economic and Financial Affairs Council (Ecofi n) in accordance with the usual procedures laid down in the Treaties.8


9The Internal Market

Whatever its longer-term political objectives may have been, the immediate goal of the 1957 Treaty of Rome was the establishment of a single, or ‘common’ market. To that end, the Treaty established deadlines for the removal of customs duties or tariffs. This process was successfully concluded well within the allotted time. By the late 1960s, with very rare exceptions, anything made in one of the Six could be exported to another member state without duty having to be paid. Member states were also banned from excluding, or placing quantitative restrictions on, imports of products from other member states, unless they could show that the goods were a threat to public health, order or morals, the exceptions specifi cally allowed by the Treaty of Rome. Why, then, did the Commission feel it necessary to publish, in 1985, a White Paper ‘on completing the internal market’?1

The answer lies in the murky area of ‘barriers to trade’. If you want to create a single market, the simple removal of obvious impediments such as tariffs or duties on imports is only the beginning. You must then convince or force national authorities not to use, for example, laws designed to protect the consumer or the environment in a mischievous way, excluding foreign imports which, though in reality perfectly safe and reliable, do not happen to conform to the precise description contained in your code of laws. As member states rapidly removed tariffs and duties, they tended to take advantage of the potential of such things as technical specifi cations to exclude foreign competition (or at least place it at a disadvantage) as well as on some occasions giving a somewhat loose interpretation of those exceptions to free trade allowed by the Treaty.

VITAL REGULATION OR ‘BARRIER TO TRADE’?

This, however, is to look at the matter in a one-sided way – the way in which enthusiasts for a single market tend to look at it. Anyone who has followed the recent history of the World Trade Organisation (WTO) and opposition to it will understand that there is often another side to the story.

76


The Internal Market 77

Like the WTO, the EU ostensibly attempts to establish fair trade between nations. And just as in the case of the WTO, this involves not only the removal of duties, but attacking anything and everything which can be seen as a government or other national authority giving an unfair advantage to its own producers over those from other countries. Environmental regulations, consumer protection laws, rules to promote public health or the safety of workers, can all result in the exclusion of particular foreign imports. All can therefore be declared illegal, with the only difference on this level between the EU and the WTO being that the EU has far more extensive power and involves a much greater handing over of decision-making from national institutions to supranational bodies.

Two important rulings by the European Court of Justice illustrate the potential confl ict between environmental protection or consumers’ interest (to take just two examples) and the drive to remove trade barriers. Both involved booze, and both helped lay the foundations of internal market case law. In the fi rst, the Cassis de Dijon case of 1979 concerned a German law which prevented this French beverage being sold over the border because its self-description as a ‘liqueur’ did not conform to the German defi nition. The ECJ ruled that this was an unacceptable interference with trade, establishing the principle that, with the exceptions mentioned above, a product which could legally be sold in one member state could legally be sold in all of them. In the second, in 1987, Germany was forced to accept the import of beers which contained additives forbidden under the national law, which has strict rules on ‘purity’ dating back to the sixteenth century. This latter case was more worrying to consumer advocates, as it could be viewed as forcing one member state to lower its standards to those which prevailed in others, a problem to which opponents of the EU (as well as anti-WTO activists) like to draw attention.2

The elimination of hidden barriers to trade prevents countries from placing their fi rms’ foreign competitors at a disadvantage. But what about the opposite approach? What if a government wants – perhaps in order to preserve jobs in an area of high unemployment, or tide a company through a sticky patch – to give a helping hand to an enterprise in its own country?

The answer is that it may do so, but only under very strict conditions and with the permission of the European Commission. Powers to regulate state aids are classed as part of competition policy. The Treaty of Rome prohibits any form of state aid that is likely to distort intra-Community competition, on the grounds that it is incompatible



with the common market. ‘State’ aid includes that which might be given by a local authority or any other body which distributes public money. As well as straightforward grants or fi nancial awards, this covers soft loans (i.e. those given at favourable rates of interest or other conditions), loan guarantees, tax breaks, the supply of goods or services on preferential terms, and the use of any sort of public ownership or part-ownership to gain an advantage. Exemptions are allowed for aid having a (strictly interpreted and narrowly defi ned) social character, or to make good the damage caused by exceptional events such as natural disasters. In addition, assistance is sometimes allowed for aid to underdeveloped regions, to promote the execution of a major project of European interest or remedy a serious disturbance in the economy of a member state, to facilitate the development of certain economic activities or areas, aid to promote culture and heritage conservation (with the same proviso), and, exceptionally, for anything to which the Council gives its assent.3

COMPETITION POLICY

These rules on state aids are part of a broader approach known as ‘competition policy’. Competition policy is the glue that holds the single market together. Article 81 of the Treaty of Rome forbids measures ‘which may affect trade between Member States and which have as their object or effect the prevention, restriction or distortion of competition within the common market’. The details laid out in the Treaty, and the body of law generated since, are therefore directed against three targets: concerted practices (where fi rms make secret deals, for example to avoid price competition); abuse of a dominant position in the market for a particular good or service; and use of state aids to enable a fi rm or industry to gain an ‘unfair’ advantage over rivals in another member state. Exemptions are allowed in certain instances, where it is felt that an arguably anti-competitive practice is in the long-term interest of ‘the market’ or of the economic wellbeing of the Union as a whole. For example, fi rms are not permitted to co-operate in order to limit production or carve up markets, but they may do so to promote technical progress. The rules are policed by the Commission, which has the power to investigate cases, issue exemptions or bring abuses to an end, and levy fi nes. The Commission sometimes even stages Untouchables-style dawn raids which does its staid, overfed image no harm at all. In addition, the Commission may investigate company mergers likely



to create dominant market positions affecting trade between member states, order mergers not to go ahead or particular aspects of them to cease, and impose fi nes.4

THE SINGLE EUROPEAN ACT

The Commission’s 1985 white paper on the internal market laid the basis for the so-called Single European Act (SEA), a series of amendments to the Treaty of Rome which entered into force on July 1, 1987.5 The major institutional change introduced by the SEA was the extension of majority voting, which had previously been quite restricted in use, to certain well-defi ned policy areas – generally those concerning the completion of the internal market.

The removal of technical barriers to trade is clearly a process that offers different national producers mutual advantages, because the existence of a single set of technical specifi cations reduces the cost of research, development, manufacture and marketing. Yet it also carries dangers, because its effects are capable of extending well beyond what are normally considered to be trade-related areas of life, well beyond even the strictly economic. In fact, the EU’s version of a ‘single internal market without barriers to trade’ serves to make obligatory a certain interpretation of the ‘free market system’ or of ‘capitalism’ and therefore lies at the heart of a left critique of this ‘Europe’.

Problems appear when you begin to argue about standards. Progressive supporters of the EU have always argued for the highest existing standards and best current practices to be generalised. If one member state does it best, everyone should copy them. Against this idea, however, is invariably a huge lobbying effort from the industries who would be obliged to respond to greater restrictions. The highest standard, decision-makers at the Commission, Parliament, Council and in the national governments are invariably told, is over-restrictive, would be expensive to implement and (this is always the big one) would ‘cost jobs’.

WIDOWS, ORPHANS AND JOBS

In nineteenth-century America there was a tendency for those who opposed any and all restrictions on the developing capitalist economy to claim that their only real concern was with the small investments of ‘widows and orphans’. These unfortunate bereaved souls were



wheeled out by politicians and industrialists who were not otherwise noted for their compassion. The modern equivalent is the magic word ‘jobs’, the protection of which for some reason appears to demand ever-lower social and environmental standards.

The result of the vigorous activities of hugely rich corporations and their highly-paid and multitudinous lobbyists is usually presented as a compromise between ‘extremes’, but it is almost (though not quite) always, one which hugely favours not best existing practice but, on the contrary, the lowest common denominator. The respective power of, on the one hand, the lobby of fi nanciers, industrialists, agribusiness, food processors, and so on, and, on the other, consumer protection lobbies, trade unionists, environmentalist or public health groups and their sympathisers in left and Green political parties, of course massively favours the former. This is true at national level, but the costs and diffi culties of lobbying in Strasbourg are that much greater, increasing the advantage enjoyed by those with money and power. The result is that the only real exceptions to the lowest common denominator rule tend to result from crises (such as the BSE or dioxine scandals) or to come when the interests of the richest countries or manufacturers appear to coincide with those of the consumer. This is what happened, for instance, in the case of the acceptance of catalytic converters by car manufacturers, who knew well enough that effective but expensive solutions to air pollution were needed, and saw the attachment of a reassuring-sounding gizmo to the exhaust system of cars as a way of staving off pressure in favour of something much more inimical to their profi ts.6

FOUR FREEDOMS: SOME FREER THAN OTHERS

The single internal market’s implications do not, moreover, stop there. An internal market is supposed to be based on what have been called the ‘four freedoms’: freedom of movement of goods, capital, services and labour. The last of these has caused the EU more headaches than almost any other subject, and the general reason for this is that although the ‘free market’ system insists on regarding labour as a commodity, it is of course no such thing. Labour is a direct human activity which requires the presence of the sentient being involved. He or she, despite the inconvenience caused to the system by these phenomena, continues to have many needs, desires, aspirations, thoughts, feelings, interests, problems and pastimes which do not contribute to the productive process. This has always made the idea of the free movement of labour a complex issue.



The Treaty of Rome gave ‘workers’ (its own word) the right to move freely within the territory of the European Economic Community’s member states, but only in order to seek or carry out employment. The right to reside was conditional on the migrant’s having employment, although having been employed a person had the right to remain in the country where he or she worked. Employers may not discriminate between nationals of different member states, in relation to hiring, pay or conditions. The right to reside after employment ends is in practice limited by the fact that states may discriminate when it comes to welfare systems.

Generally speaking, the contributory element of any system must be non-discriminatory. If you have worked and paid into a scheme for unemployment insurance, sickness benefi ts, state retirement pensions, and so on, then you are entitled to benefi t, whether or not you are a citizen of the country in which you worked. You are not, however, entitled to non-contributory welfare payments, those which do not depend on a person’s having worked and paid into a scheme. These are usually designed to guard against destitution, and are paid when all other possibilities fail. This is what is often termed the ‘safety net’, and in this element state authorities are with few exceptions allowed to limit payments to their own citizens.

Other rights enjoyed by EU migrant workers include ‘aggregation’, through which pension rights accumulated in one country may be added to those gathered in another, so that if you work for 20 years in one country and 20 in another, you will be treated, with certain provisos, as if you have worked for 40 years in the same place. In addition, persons seeking work in another member state are entitled, for a maximum three months, to receive benefi ts from their last country of employment. Finally, child benefi ts and family allowances, though non-contributory, must be paid to migrants. Close family members of migrant workers also derive certain rights from the employment of their, for example, husband, wife or parent.

The question of welfare rights, though problematic, is probably not the place to look for an explanation of why trans-frontier labour migration is close to non-existent within the EU. People’s willingness to move to seek or take up employment elsewhere is in practice limited by numerous factors. Such willingness is confi ned almost exclusively to specifi c groups: young people intending to see something of the world before they begin a career; a small number who are simply footloose, adventurous or on the run from the law or worse; the highly educated; and, fi nally, the desperate. Most people



who leave their home countries – or even their home regions – in order to fi nd work do so because they have no choice. Many are men who move without their families, sending most of their pay home to Portugal, Turkey or Teesside.

This is not the case everywhere in the world. The biggest and best-known exception is the United States, which has a single common language, has been a single market for over two centuries, and has a culture which contains a large element of the homogeneous: laws and customs, food and drink, systems of housing and education and so on, do differ between states and regions, but there is always a core which does not vary, and a narrow band of differences – often enough to allow for regional pride, and to make a new place interesting, but not threatening or bewildering. The achievement of such a degree of cultural unifi cation would require changes in European society which would make it as unrecognisable to us as we would be to ancient Romans. ‘Globalisation’ notwithstanding, it is unlikely to happen in a thousand years, and without it, labour mobility will continue to be confi ned to the above-listed groups.

Mutual recognition of educational and vocational qualifi cations, the rights of self-employed people and the freedom to provide services are other issues which have to be tackled on the road to the achievement of free movement, and in each case the legislative situation has been greatly reformed since the original Treaty was signed. The situation on the ground, however, can be quite different to that which exists on paper. It is all too easy for an obstructive authority, or even an individual bureaucrat, to erect barriers to the establishment of a business, to question unfamiliar qualifi cations, to discriminate in favour of local providers of services. Such behaviour may be motivated by xenophobia, but it can equally well be directed at the preservation of valued local customs and traditions. Whatever the motivation, however, it can be extremely successful in making it impossible for foreigners to take advantage of rights contained in treaties and regulations.7 The European Union can only have legitimised it when, on the entry of ten countries in May 2004, it broke its own rules by allowing the older member states to restrict access to their labour markets in respect of workers from these countries.

CAPITAL

Capital, unlike labour, enjoys complete freedom of movement and rarely encounters obstruction or prejudice when it arrives at its



destination. A Directive of 1988 guarantees the full liberalisation of all capital movements.8 EMU has, of course, facilitated these movements.

The infl exibility of this law, and the fact that it applies to movements into and out of the Union as well as those within it, was confi rmed by the European Commission in 2001, when the movement for a Tobin Tax began to attempt to exert pressure on decision-makers. Named after a Nobel Prize-winning economist who devised the plan, a Tobin Tax would involve a very small tax on international capital movements, the proceeds of which would be used to address global inequality. The idea is that such cross-border transactions now represent such huge amounts of capital that a tax so small it would hardly be noticeable to the individuals or fi rms involved would nevertheless be capable of raising signifi cant amounts of revenue. Unfortunately, in an answer to a question posed by Swedish Left Party Euro-MP Jonas Sjöstedt, the European Commission clearly stated that such a tax would be forbidden under the EU’s rules. The Directive of 1988 was for clarifi cation purposes, for the right to move capital freely is written into the Treaty.9

Whether such freedom stimulates economic activity is a question which is never posed in the mainstream media. A case can certainly be made for the opposite view. The fact that it makes big corporations far more diffi cult to tax is, however, unquestionable.

PRIVATE GOOD, PUBLIC BAD

There is not much value in having the right to sell your Aberdeen kippers in Athens if you can’t get them there, and for that you need better railways, roads, inland waterways and so on, or so it is argued. And so was born the idea of Trans-European Networks, TENs.

Under TENs, motorways are built in the name of ‘relieving congestion’, despite extensive evidence that they are completely ineffective in doing so. Aid to rail promotes high speed trains, which though admittedly an enjoyable way of getting around western Europe for those who can afford it do little to tackle the real problem of a declining rail network, despite the European Commission’s constant lip service to the environmental advantages of rail over road.

In telecommunications, the emphasis has been on the creation of so-called ‘information highways’, particularly regarding electronic systems which directly facilitate the running of the internal market, but this has been conducted in parallel to huge pressure to liberalise



as a supposed precondition of the modernisation of services. TENs in the energy sector aim at the integration of increasingly liberalised gas and electricity sectors, though other targets are to underwrite European fi rms’ international competitiveness by supplying them with relatively cheap (as well as reliable) energy, an aim which is clearly approved by corporate capital but which does not always sit easily with environmental objectives or with the interests of the ordinary domestic consumer. TENs have also been directed at the integration of waste management policy and water delivery. TENs projects are fi nanced from the Cohesion Fund, loans from the European Investment Bank and from private capital, sometimes in the form of loans guaranteed through the European Investment Fund.

The drive to complete the single internal market also saw the introduction, more or less by stealth, of an assumption into the commandments of Political Correctness by which the EU is ruled: private enterprise good, public enterprise bad. Nowhere in the Treaties does it say that the state must withdraw from economic life. Numerous details, particularly of competition policy, can, however, be interpreted to mean just that. When publicly owned enterprises are forbidden to use the advantages of public ownership to compete with private fi rms – for example, the ability to transfer wealth from more productive to less productive economic activities in the interests of the general good, rather than shareholders’ profi ts – they cease to function in the way that was envisaged by their instigators. Nationalised industries can no doubt be just as ruthless and therefore just as profi table as any private fi rm, but then what precisely is the point of them?

The fact is that publicly-owned undertakings are an embarrassment to the Treaty of Rome. This is because market distortion is generally the whole point of social ownership. For example, buses may be municipally-owned in order to ‘distort’ a market which, were it allowed to function ‘freely’, would force people to walk everywhere; health care is usually publicly-funded in order to ‘distort’ the natural consequences of the market, which in this case would be to allow large numbers of people to suffer and die for want of funds. The Treaty of Rome does not forbid public ownership; it is simply that, strictly interpreted, it outlaws the practices which make it advantageous. Public enterprises may not be granted privileges which gives them an advantage over potential competitors in other member states: Austria’s state-owned monopoly of import and wholesaling of alcoholic drinks was abolished when the country joined the Union, for example.



Two special categories of undertaking – those responsible for a fi scal monopoly, and those providing a service of general economic interest – may be given privileges which would normally contradict the Treaty of Rome, provided any such exemption is necessitated by the particular tasks assigned to the undertaking and does not disrupt trade to an extent that would be contrary to the Community’s interests. Yet the qualifying rules for such an exemption are vague and shifting: in postal services, for example, the space reserved for the public service is subject to progressive reduction, while pressure on member states to open their public transport systems to competition has been unrelenting. The problem this approach causes is known as ‘cherry picking’: private fi rms get all the lucrative business whilst the taxpayer is left to ensure that sheep farmers can get a bus to their nearest pub and lighthouse keepers continue to get Christmas cards from their mums.10

The single internal market project can be said to have been, in its own terms, a success. It has created a market of some 455 million people in 28 countries, as not only the EU25 but the three small countries which remain in the European Free Trade Association – Norway, Iceland and Lichtenstein – also participate, through a system known as the European Economic Area. Its supporters argue that it has succeeded in reducing the cost of manufacture and transport of goods, though by how much is disputed and diffi cult to specify. The big market, furthermore, is said to increase ‘Europe’s’ economic weight and thus its political clout.

MIXED BLESSINGS

Many of the alleged benefi ts of the single market are, like most things, good in some ways, perhaps, but damaging or otherwise undesirable in others. Cheaper transport, for example, (which may in any case have more to do with a decade of relatively low oil prices coupled with a sustained, vicious and hugely successful assault on transport workers’ pay and conditions) is hardly an unquestionable boon. Whilst it may have appeared to increase the variety and lowered the price of goods available to the consumer, to the extent that this has been achieved it has been at the cost of enormous environmental damage. The transport of goods is now so cheap that costs, in terms of their contribution to prices, have become less and less signifi cant. The result is that it is possible to buy Swedish or Welsh mineral water in Belgium, a country whose normal weather is rain. French apples



travel to Italy and Italian apples to France. Variety is not increased, because the range of fruit grown in any particular country or region becomes ever narrower. In a similar way, as transport costs lower, freight traffi c is shifted from rail to road and new motorways spring up to disfi gure the landscape, jobs naturally cluster in booming urban centres at the expense of ‘less favoured regions’.

Removal of frontiers to the movement of capital and goods has also encouraged delocalisation, the movement of productive facilities from higher to lower cost countries. This in turn puts downward pressure on those things which benefi t the rest of us but cost corporate profi ts: wages, social standards, health and safety regulations, environmental controls. Like the WTO, moreover, the European Union, with its enforcement powers through the Commission and Court of Justice, makes it more diffi cult for national authorities to take action in defence of these.

As with so many things, the balance sheet of costs and benefi ts arising from the single market tends to depend on who you are. For big corporations, the benefi ts are clear. For the rest of us, the picture is at best much more mixed. Many of what might seem the obvious pluses of a single labour market have turned out to be rather more problematic than we were told would be the case, especially when it comes to enforcement of rights. The free movement of goods has some benefi ts, but great costs to the environment as well as to small producers and distributors. It is hard to see how free movement of capital benefi ts the mass of people who do not own any, and the fact that banks maintain outrageously high charges for people who wish to move small amounts of money between countries tells its own story.

SERVICES

The one area in which the EU has conspicuously failed to create a thoroughgoing single market is in relation to services. The suggested approach, brought forward by outgoing Commissioner Frits Bolkestein, well-known in the Netherlands as an ideologue of the right, was so extreme that it was rejected even by some members of the European Parliament’s largest political group, the centre-right European People’s Party. The proposed Directive on Services in the Internal Market’s most controversial feature was that it was designed to allow service-providing companies in most sectors to register their company in one member state in order to provide services in



another. Under the so-called Country of Origin principle a fi rm would be obliged only to follow the laws on, say, working conditions or environmental protection, emanating from the country in which it was registered. As registration would not require a company to have any real relationship to its ‘Country of Origin’, nothing more, in fact, than a box number, this was tantamount to proposing that the notorious fl ag of convenience system be extended from maritime shipping to the rest of the economy. A company could register in a country with the most minimal requirements in relation to, for example, how it treats its workforce or how well it respects the environment, and then proceed to do business in a member state with relatively high standards. Aside from the fact that, especially among the new member states, there are countries whose standards are already low, this approach would clearly risk provoking what is known as ‘social dumping’, a ‘race to the bottom’ to see who could attract the most registrations through having the least exacting requirements.

Given the storm of protest that greeted the proposal when it arrived at the European Parliament, the Commission was inclined to think again. Bolkestein’s unfortunate successor as Internal Market Commissioner, Irishman Charlie McCreevy, promised the Parliament in March 2005 that the text would be amended in order to make it ‘clear that conditions and standards for workers will not be affected in any way’, adding that ‘I don’t want to hear any more talk about so-called social dumping. This is not what this proposal is about and we should put an end to this confusion.’ He further promised that ‘sectors such as health and publicly funded services of general interest’ would be excluded, and that ‘concerns about the operation of the country of origin principle’ would be addressed, though his further statement that the principle was necessary made it diffi cult to see how his fi rst promise could be kept. His promised rethink did not extend to a withdrawal of the text as it stood and it did not prevent tens of thousands of demonstrators from marching through Brussels later in the month in protest at the proposal.11

PLANS

Aside from the Services Directive, the European Commission’s thinking during 2005 showed that they saw the existing single market as incomplete to the degree that it was holding back the Union from the fulfi lment of its stated economic goals. These goals, embodied in



the so-called Lisbon Programme, envisaged the Union’s becoming the world’s most competitive economy by 2010. This was largely to be achieved at the expense of working people, through the deregulation of labour markets as well as of sector after sector of the economy, and subsequent downward pressure on real wages and the ‘social wage’ of welfare and education spending.

According to the Commission’s own assessment, the Action Plan for the Single Market which it established in 1997 had been extremely successful, although signifi cant exceptions to the principle of an area without impediments to trade remain. Member states had made great strides in implementing agreed measures, but they had failed to eliminate completely the backlog. Great differences remained in relation to the protection of intellectual property, especially in controversial areas such as biotechnology. More surprisingly, perhaps, construction products continued to be governed by different specifi cations in different member states, creating a barrier to trade in the goods concerned. The fact that taxation remained largely the prerogative of national governments meant that differences in tax rates and practices continue to hinder cross-border trade, or, as the Commission euphemistically put it, ‘the Community still faces considerable challenges in eliminating remaining tax barriers and providing a more favourable tax environment for an effi cient Single Market capable of generating more employment opportunities’. Those jobs again. Almost fi fty years after the Treaty of Rome pledged the original Six to getting rid of it, moreover, ‘state aid expenditure remain[ed] a major source of distortion in the Single Market’.12

These complaints have scarcely changed since. Although the Commission stated, early in 2005, that there had been encouraging progress, it excepted services from this assessment and complained that ‘Economic indicators suggest that market integration is not moving fast enough.’ Nevertheless, non-implementation of agreed internal market measures had fallen dramatically, from over 13 per cent at the end of the Action Plan in 1998 to 3.6 per cent, although companies seeking to do business across borders were still faced with too much ‘red tape’.

More needed to be done, especially as both trade in goods and price convergence between member states, two key indicators of the single internal market’s success, were slowing down. In 1998 one of the suggested solutions for these problems was the introduction of a Community Patent, a ‘European’ alternative to national patents. In 2005 it was still being suggested. Recognition of professional



qualifi cations, long a problem area, continued to create diffi culties. Even with good will, it can be diffi cult to get different national traditions and practices in relation to vocational qualifi cations to mesh. As the Union suffered economic slowdown and diced with recession, good will tended to evaporate as member state governments became most concerned to protect the position of those who had the power to kick them out of offi ce.13

The integrationist dream is that the internal market will in the foreseeable future lead by inexorable steps to a united Europe, founded on what the Commission has called a European home market in which all member states would adopt the euro; there would be a harmonised tax system, including an integrated VAT system based on adjacent rates from one country to another and the principle of payment at the place of origin; integrated physical and fi nancial infrastructure, based on completion of the trans-European transport, energy and telecommunications networks; complete freedom of movement for citizens and legally resident or visiting non-citizens; and ‘legal instruments to enable businesses to operate effectively throughout the market’ (by which is meant, presumably, measures such as the Directive on Services).14

CONSUMER PROTECTION

As we have seen, the Treaty of Rome was principally concerned with people as economic actors – employers, workers, and so on – rather than as citizens. This did not rule out competence for consumer policy, however, as buying goods and services is as much an economic act as is production of the same. Nevertheless, little attention was paid to the matter before the fi rst EC Consumer Action Programme began in 1975. In fact, only since Amsterdam has the EU paid close attention to what the Treaty (Article 153) describes as the Community’s duty to ‘contribute to protecting the health, safety and economic interests of consumers as well as to promoting their right to information, education and to organise themselves in order to safeguard their interests’.15

Other requirements laid down in the Treaty include the stronger integration of consumer interests into other policies; the taking into account of scientifi c evidence in the evaluation of proposals concerning health, safety, environmental protection and consumer protection measures. Individual member states are specifi cally authorised by the Treaty to take more stringent measures than those agreed at EU level,



providing they do not confl ict in other ways with the Treaty. The aims of EU consumer policy are given as enabling the consumer to exercise his or her rights to protection of health and safety, fi nancial and legal interests, and to representation, participation, information and education. Initiatives guided by these principles have concentrated on informing the consumer so that he or she can make an educated choice, and protecting health and safety.

The most recent Action Plan, Priorities for Consumer Policy 1996–1998 (COM(95)0519), was based on these priorities, with particular reference to the developing single market, to fi nancial services, essential public services, new telecommunications technologies (the ‘Information Society’), and food. The Action Plan also concerned itself with environmental questions (‘sustainable consumption’), consumer representation, consumers in the applicant states of central and eastern Europe and in developing countries.

Major EU measures in favour of the consumer include the 1992 General Product Safety Directive, a series of directives restricting the marketing and use of dangerous substances, countless food safety laws, and rules governing cosmetics, toys, and medicines. In the wake of the ongoing BSE crisis, as well as scares over dioxins, e-coli, salmonella, pesticide residues and GMOs, particular attention is now being paid to food. During the 1990s, directives were also agreed on consumer redress, liability for defective products, and unfair terms in contracts. Also governed or affected by EU legislation are door-to-door sales, distance selling, consumer credit, time share and package holidays, airline fares and overbooking, misleading advertising and price indication. Famous abuses which the EU authorities have failed to deal with include the fact that cars are distributed under a monopolistic system which is mysteriously allowed to ignore all of the normal rules of competition policy and which results in price differentials between member states of up to 40 per cent, and increasing. Volkswagen was actually fi ned (102 million ECUs, in 1998) by the Commission for systematically preventing its Italian dealers from selling VW and Audi cars to non-Italian clients – mostly Germans who crossed the border to save thousands of Marks by buying a German car in Italy, a diffi cult one to call for those who believe in patriotic shopping. Rip-offs associated with cross-border payments have also proved stubborn, with the Commission perhaps waiting until the magic wand of the Euro waves the problem away. A Community System for the Exchange of Information aids communication between member states on dangerous products.16



In recent years, repeated food scares have drawn attention to the need for improved consumer protection in that area. In addition, although people show no more inclination to move permanently from their home countries to other member states, travel for business and leisure has risen enormously, creating a perceived need for protection for the consumer who is far from home and trying to cope in a foreign language.

These two developments are refl ected in the European Commission’s most recent statement on consumer policy, Consumer Protection in the European Union: Ten Basic Principles. These ten principles are listed as follows:

• Buy what you want, where you want.• If it doesn’t work, send it back.• High safety standards for food and consumer goods.• Know what you are eating.• Contracts should be fair to consumers.• Sometimes consumers can change their mind.• Making it easier to compare prices.• Consumers should not be misled.• Protection while you are on holiday.• Effective redress for cross-border disputes.

Unfortunately, Consumer Protection in the EU is an information leafl et and not a legislative programme. No new legislation to make these supposed rights a reality is proposed, the Commission’s attitude being that if member states would correctly implement and enforce existing law, problems would be greatly reduced. In this they are almost certainly correct, but a belief in the likelihood, or even the possibility, of effective redress for cross-border shoppers in a Union of 25 countries is quite simply utopian. Caveat emptor – let the buyer beware – is, under such circumstances, the only truly effective consumer protection.17


10External Economic Relations

The creation of a customs union in 1968 removed a number of remaining restrictions on the internal market. It also established a common external tariff as part of a common commercial policy governing trade relations between the Community and the rest of the world. The aim was to reduce destructive competition between member states, as well as to ensure that once goods had been imported, they could move around the EC as freely as could those manufactured within it.

External trade has long given the European Commission its highest profi le on the world stage. Because of the existence of the customs union, as it effects external trade, the EC, then EU, has had to be represented in its own right at trade negotiations with third countries. Indeed, with regard to agriculture and fi sheries the member states play very little direct part in negotiations. A set of guidelines and goals is agreed by the Council, which then communicates this to the Commission, after which the Commission gets on with it. In other areas, where responsibility for policy remains to a great extent with the individual member states, national negotiators are obliged to respect a ruling of the ECJ in determining their stance.1

IMPORTS

The most important element of the EU’s trade policy remains the Common Customs Tariff (CCT). This Tariff must of course be agreed between 25 member states with sometimes diverse and confl icting interests, but it must also be negotiated with international trading partners within the system mediated by the World Trade Organisation (WTO).

In addition to the CCT, imports are governed by a set of common rules applying to all products from outside the EU, with a special system governing textiles, which are subject (world-wide) to quotas and special rules. Products originating from certain countries may also be subject to special restrictions for political reasons, of course. In recent times the EU has taken part in trade embargoes against, or

92


External Economic Relations 93

placed other forms of restriction on inter alia, Belarus, Congo, Ivory Coast, Croatia, Iraq, Liberia, Burma, Sudan, China and the US.2

Finally, special arrangements govern the import of various farm products. These are usually hangovers from agreements which predate the Treaty of Rome and have their roots in colonial systems or those negotiated when former colonies became independent. Preferential treatment may therefore be exercised, ostensibly at least to prevent the collapse of economies dependent for historical reasons on trade with one or more EU member states. This occurs particularly under the ACP system (the initials stand simply for Africa, Caribbean, Pacifi c) which for the most part embraces the member states’ former imperial possessions.3

If member states believe that they have been subject by a particular third country to unfair trading practices – such as the dumping of goods for below cost price, which is sometimes done to cut losses, or with the deliberate intention of harming a rival national industry – they cannot act independently, but must bring the matter to the attention of the Commission, which investigates. This may result in what is offi cially known as ‘surveillance’, including ‘retrospective surveillance’ covering the recent history of imports of the commodity or commodities involved from the alleged offending country. Action may include the imposition of anti-dumping duties, though the third country involved can contest the validity of these by taking its case to the WTO. Other than straightforward dumping, both the EU and WTO allow protective measures to be taken in cases of exports from third countries where the products in question have been made cheaper by state subsidies, in which case a countervailing duty can be imposed to offset the price reduction brought about by the subsidy.

Clearly, the same problems apply to external imports as is the case with trade between member states. As far as trading partners are concerned, policy choices are narrowed by the ban on state aids. Member states may also be prevented from imposing quotas or bans in response to demands from their own citizens, or parliaments. Environmentally-damaging products, or those from fi rms or countries which are exploitative (for example by using child labour, or refusing workers the right to organise), can be subject to restrictions only if these are agreed by the rest of the EU. On the other hand, trade embargoes such as that imposed on Iraq after the fi rst Gulf War cannot be unilaterally lifted by a member state which may have decided the time has come to do so. The perceived danger is that, in



common with the WTO, the European Commission is likely always to bow to the most powerful of pressures. Occasionally this may be public opinion, but it is far more likely to be the commercial needs of big corporations.

EXPORTS

As well as the CCT and other measures governing imports, the Community operates a common set of arrangements on exports. Exports may not in general be subject to quantitative limits, though exceptions are allowed. One major exception applies to petrol and natural gas, trade in which is sensitive and regulated by a complex system of international agreements.

Normally, if a member state believes that market conditions are such that limiting the amount of a commodity which can be exported would be justifi ed, it must ask the Commission to initiate what is known as a ‘Community information and consultation procedure’. The Commission may equally decide to do this on its own initiative. If the Commission concludes that extraordinary measures are justifi ed, it can make exports subject to special authorisation. Such authorisations may apply to a commodity or group of commodities, either from the whole of the EU or a region or country, and may also be limited to particular destinations. Any proposed action by the Commission must then be approved by the Council.

Any measure taken by a member state to stimulate exports must, insofar as it constitutes a state aid, be approved by the Commission. Obviously, if one member state were to give aid to exporters of a particular commodity, this might give its own national producers what the EU and its treaties see as an unfair advantage. The general approach has not, however, been to attempt to eradicate such aids but to harmonise systems in pursuit of that mythical grail, the level playing fi eld. There is also some EU-level assistance to exporters, but outside of the special case of the Common Agricultural Policy this is generally limited to providing fi nance for joint action and research, including events such as trade fairs and seminars.

The EU does not, of course, devise its trade policies independently. Since 1947, international trade has been governed by multilateral institutions, the most important of which, for the western, capitalist world, was originally the General Agreement on Tariffs and Trade (GATT), which, after the collapse of the alternative trade system dominated by the Soviet Union, gave birth to the WTO.



The WTO philosophy is ‘free trade good, protection bad’. As this is also the driving philosophy behind the EU integrationist project, one would expect the Union to be amongst the WTO’s best pupils. This has not, in fact, always been the case, as the temptation for the Union, a temptation which has grown with its territory, is to pursue the alternative – the creation of a self-suffi cient market behind impenetrable external borders. Within the context of the Common Agricultural Policy, and here and there in other spheres as well, the European Union continues, when it suits it, to use protectionist devices. This hypocrisy, however, should not blind us to the facts: the Union has been a major driving force behind the liberalisation of world trade, and there seems little prospect of this changing. Taken as a bloc, the EU is the world’s biggest trader.4

GLOBALISATION

‘Free trade’ has become the dominant economic philosophy of global capitalism and is now broadly interpreted to imply wholesale deregulation, liberalisation, privatisation and the imposition of institutionalised external pressures (Structural Adjustment Programmes for the Third World, the Growth and Stability Pact for the European Union) which have led to the dismantling of welfare states, to wage cuts, delocalisation of production and even (the case of Yugoslavia is the best documented) to war.

What began as an economic project, the ‘freeing’ of trade, has become a crusade which, like the EU itself, reaches into every corner of life. The logic which led from the Common Market to the Single European Market, to the single currency and beyond, works in the same way at the global level.

This is the meaning of ‘anti-globalisation’, the solution to the apparent paradox of why the most internationally-minded people see globalisation as a threat. Globalisation, like ‘Europe’, is not a politically and economically neutral phenomenon which simply transfers the same arguments – between market economies and mixed economies, for example, or between the ‘social market’ and socialism – to new fora at new levels of international debate and co-operation. Both are, on the contrary, quite clearly attempts to abolish these debates, to negate or ignore the contradictions which give rise to them, and to take decision-making ever further from the people into remote bodies which, moreover, do not admit to taking decisions at all. Instead, they follow inevitabilities created by mysterious ‘market



forces’, the invisible hand strangling the life from any alternative which may remain.

The European Union is, however, not content to allow the invisible hand to do all of its own work. Leaked documents revealed, early in 2003, that the Commission had drawn up secret plans aimed at ‘persuading’ poor countries to open their service sector markets to foreign competition. In return, the EU would cut subsidies to agricultural exports, a major source of discontent in the Third World and a major cause of bankruptcy in its countryside and destitution in cities subject to ever-growing overcrowding as farmers, forced off the land by cheap imports, fl ood in to urban centres looking for a means to survive. Plans, as one newspaper put it, ‘would allow European fi rms to charge for providing water to some of the 1.2bn people living on less than a dollar a day’. In addition to cutting subsidies, the EU would improve access to developing countries’ products. The demands did not stop at water, for ‘Brussels is determined to win large gains for its highly competitive banking, telecoms and business service fi rms ...’5

As with the proposed Directive on Services in the Internal Market, the concern is now less remaining barriers to trade in goods than the huge and potentially lucrative world market in services. Nationalised production of goods is now a rarity, but public ownership of service industries remains widespread. In most countries where basic services are privately owned, moreover, providers are subject to minimum requirements and ownership by foreign interests is forbidden or restricted. Many states seem curiously unaware that the only way to improve effi ciency is to allow wealthy European and American corporations to buy up their service industries lock, stock and barrel. Some would call the Commission’s attitude ‘blackmail’, but they clearly see it as a means of education in the niceties of twenty-fi rst-century economics.

DEVELOPMENT POLICY

Until Maastricht, the European Community could not point to anything in the Treaty of Rome which specifi cally gave it competence in the area of development policy. Nevertheless it was able to pursue a limited agenda through the Lomé Convention, an agreement with the ACP group, made up for the most part of ex-colonies of France, Britain, Portugal, Belgium and the Netherlands which enjoyed preferential access to European Community markets. The EC was also



party to various Association Agreements with developing nations and to numerous other trade agreements with a development element.

New Articles added at Maastricht put the policy on a fi rmer legal footing, giving it four principal objectives: to promote sustainable economic and social development, with special attention to the very poorest countries; integration of developing countries into the world economy; reduction of poverty; and consolidation of democracy, the rule of law and respect for human rights. The implementation of the resulting policy is carried out partly through regional agreements, of which Lomé is only one. In addition, the EU has agreements with countries of two regions of the Near and Middle East, covering Algeria, Tunisia and Morocco on the one hand, and Egypt, Jordan, Syria and Lebanon on the other.

The Union is also involved in a large number of international agreements and conventions with development implications: the World Trade Organisation, various nature conservation and other environmental treaties, and so on. In addition, it has formalised trade relations and agreements on fi nancial and technical aid with several developing countries and trade blocs in Latin America (where the trade bloc is known as Mercosur) and Asia (ASEAN). Finally, the EU is empowered by its Treaty to offer humanitarian aid and administers a special fund to combat world hunger.

The Commission, which is responsible for the day-to-day administration of development and trade policies, sees aid as a ‘lever for economic and political reform’. This in turn implies that policy should prioritise measures that encourage domestic reform. What type of reform is seen as desirable is laid down in the Maastricht Treaty: democratisation, economic and social development, integration into the world economy (for which read, adoption of the ‘free trade’ religion) and a campaign against poverty. We have seen, in relation to the EU’s role in the General Agreement on Trade in Services (GATS) negotiations, what this means in practice.

The overwhelming weight of opinion is that development policy since Maastricht has, if measured against its stated aims, largely failed. The situation in the institutions mirrors that found so often in other areas, such as environmental or social policy. The people specifi cally responsible within the Commission are at least aware of the issues, even if the constraints under which they work and their own ‘free market’ ideologies render their efforts to address them ineffective or worse. Stray into other Directorates-General, however, and you will fi nd the lofty goals embodied in the Commission’s rhetoric



readily subordinated to the supposed realities of international trade, economic growth at all costs, and the interests of the EU’s multinational corporations.6

It is true that alongside attempts to force poor countries to liberalise their service industries, there is much talk of aiding them to achieve what are known as the ‘Millennium Development Goals (MDGs)’, a set of poverty-reduction and quality-of-life targets which emerged from a series of international conferences held during the 1990s.7 In order to meet the MDGs by the year 2015, wealthy countries are supposed to achieve at least the level of 0.7 per cent of GDP allocated to overseas aid which was agreed as a target as long ago as 1970. The fact that this target has been reached by only a handful of countries, however, cannot be directly blamed on the European Union, as national development aid continues to account for a far greater proportion of overall transfers than anything paid through the Commission. Of the 25 member states, only Luxembourg, Sweden, the Netherlands and Denmark have reached this level, while Italy’s is a miserly 0.17 per cent amd Germany does not expect to reach 0.7 per cent until 2087.8

This, however, is strictly speaking outside the terms of reference of this book, except insofar as it demonstrates that it would be within the EU member states’ power at least to alleviate the suffering to which the Union’s trade policies – which are, after all, under their ultimate control – undoubtedly lead. That they choose not to do so should remind us that the European Union, for all its faults, is no more than the agglomerated political expression of the governments of 25 countries. It is also one which gives each one of those countries an easy excuse for anything which its people or parliament dislikes, one which over time tends to drag each member state down to the lowest common denominator, and one which makes it virtually impossible for an individual country to take the kind of bold and radical step which will be needed, for example, if the terms of trade are ever to be transformed from a tool of exploitation to an instrument of co-operation and progress.


11Employment and Social Policy

Europe’s economy has for some time been growing more slowly than that of the US and has recently seen a fall in the rate of productivity growth. Since 1996 the average annual growth in EU output per head has been 0.4 percentage points below that of the US.1 Despite the fact that a more equal distribution of wealth, access to affordable health care, greater job security and signifi cantly lower rates of crime in most parts of Europe mean that life for ordinary men, women and above all children is in the main simply much better in the developed parts of the EU than it is in the United States, this is seen as an enormous problem.

It would be imprudent simply to deny that there is any problem without fi rst examining whether the lower rate of growth threatened to undermine these social achievements. However, it must fi rst be noted that part of the reason for that lower rate of growth lies in the greatly superior working conditions enjoyed by most European employees in comparison to their US counterparts, and the fact that workers in Europe are happy to take their share of any increase in prosperity in forms which do not contribute to GDP. It is also important to remember, in this context, that GDP does not measure quality of life. Since World War Two paid holidays have steadily grown in length in the countries of the EU15, for example, whilst this is not the case in the US. In practice few people have the choice as to whether to take longer holidays or higher wages as their income-per-day improves. If they did, they would no doubt be divided by personal circumstances and temperament, but surely not into a rational, admirable group who took the money and an irrational, contemptible group which chose to have extra leisure time. Yet to fetishise GDP growth is to commit precisely that error.2

There are, of course, other ways to enhance production than simply by working more hours. Yet in the end increased productivity, however achieved, will always offer the choice of more wealth or more leisure, whether that choice be exercised individually or socially. The irony of the EU’s approach to its economic problems is that, in fetishising growth, it risks undermining everything which, through both their contribution to that growth and their insistence, by industrial and

99



political organisation, on its use for their benefi t, working people have achieved in the last half-century.

At the Lisbon European Council (March 2000), the heads of state and government of the European Union famously declared that their goal was for the EU to become, by 2010, ‘the most competitive and dynamic knowledge-based economy in the world, capable of sustainable economic growth with more and better jobs and greater social cohesion’.3 In this way full employment would be achieved and the overall EU employment rate would be raised to 70 per cent and that for women to more than 60 per cent by 2010. The Stockholm European Council a year later further declared the intention to raise the rate of labour market participation of the over-55s to 50 per cent. These targets were to be achieved on the basis of a growth rate of at least 3 per cent.4

Five years on, the Commission adopted, early in 2005, its ‘Social Agenda’ for the period 2005–10,5 prioritising the achievement of full employment and the other goals of what has come to be called the ‘Lisbon Strategy’ and its core, the European Employment Strategy (EES) (also known, once again after the place where it was adopted, as the Luxembourg Process).

In practice the Strategy takes the form of an annual cycle, beginning with the European Council’s adoption of a broad framework for action based on an agreed set of common objectives and targets for employment policy. These include ‘Employment Guidelines’, renewed annually following a proposal from the Council, and stipulating common priorities for member states’ employment policies. National Action Plans are then drawn up in which each member state explains how it will put the Guidelines into practice. The Commission and Council next jointly examine each National Action Plan and present what is known as the Joint Employment Report. On the basis of this Report, the Commission presents a new proposal to revise the Employment Guidelines as necessary for the following year and the whole cycle begins again. If a qualifi ed majority in Council votes its approval, a Recommendation may be issued targeted at a single member state.

The EES is based on what is known in the jargon as the ‘open method of co-ordination’. The Lisbon Strategy was designed to be comprehensive, and therefore inevitably strayed into areas beyond the EU’s competence and into those which remained the responsibility of the member states. The hope was that through a combination of Commission monitoring and peer pressure to


Employment and Social Policy 101

keep up, ‘convergence’ would occur, by which was meant that concerted action would be taken by the member states. Progress is monitored by the use of quantifi able objectives or objectives which can be assessed qualitatively, which is clearly more diffi cult. Annual reporting from each country is designed to facilitate comparisons of progress towards the achievement of these objectives as well as the identifi cation of best practices. According to the Commission, ‘This creates peer pressure to improve the quality and effectiveness of policy. Exchange of experiences and peer pressure are meant to steer policy debate and enhance the effectiveness of policies.’ Finally, an ‘integrated approach’ extends the scope of Employment Guidelines not only to labour market policy per se but to social, educational, tax, enterprise and regional policies. As the Commission explains, ‘Structural reforms cannot be obtained through isolated and dispersed actions or measures, but require consistent and concerted action over a wide range of policies and measures.’6

The Lisbon Strategy’s stated objectives included not only ‘realising Europe’s full employment potential by creating more and better jobs, anticipating and managing change and adapting to the new working environment, exploiting the potential of the knowledge-based economy and promoting mobility’, but ‘modernising and improving social protection’, as well as ‘strengthening gender equality and reinforcing fundamental rights and combating discrimination’. A labour market which functions more effi ciently, creating wealth and providing widespread opportunity, is designed in part to enable the eradication of ‘poverty and exclusion and … the integration and participation of all into [sic] economic and social life’, as well as ‘promoting gender equality’ and combating discrimination in general.7

There is, however, a problem in reconciling these different ambitions which the Commission and integrationists in general consistently refuse to acknowledge. The problem occurs as a result of the kind of economics to which the integrationists are wedded, and which since Maastricht has become increasingly institutionalised, to the extent that it underlies even the proposed EU Constitution. According to this type of thinking, labour markets are over-regulated, anything but the most minimal ‘interference’ in the workings of the ‘free market’ simply encourages ineffi ciency, and the only way to stimulate employment is to liberalise the economy of the Union and its member states to the greatest possible degree. Defi cit fi nancing is always wrong, state aids are the root of all economic evil and wealth



is created by entrepreneurs, who must be allowed to operate without ‘unnecessary’ restraint.

The Lisbon Strategy is based squarely on this approach, and pressures on member states to conform to it have added to the narrowing of policy options available to member states, a phenomenon attendant upon monetary union. This makes it diffi cult to take seriously the possibility of the various objectives’ being achieved, for it looks worryingly as if new jobs will come only at the price of secure working conditions, decent wages, and a well-funded social security and welfare system. The policies which might transform this from rhetoric to reality have been ruled out, sacrifi ced to the pursuit of a fetishised and vaguely-defi ned ‘competitiveness’.

Having lost their ability, for example, to manipulate their currencies’ exchange rates in order to cheapen their exports and thus stimulate employment, or to use strategic state aids or tax breaks to bring jobs to regions or sectors where they are needed, the EU’s member states have only one means at their disposal to defend the competitiveness of their economies. They must cut labour costs. Despite much talk of effi ciency savings, the only real way to achieve this is through reducing both individual wages and the ‘social wage’, otherwise known as the welfare state.

This ‘liberalising’ school of thought, which now includes almost every member state government, whatever its alleged political hue, holds that unemployment is caused almost entirely by over-regulation. For example, employers are reluctant to take on staff because it is so hard to get rid of them when they are no longer needed. Non-wage costs of employing labour, in the form, for example, of employers’ contributions to social insurance or state pension schemes, are said to be too high. The ideal system is seen as that of the United States, where it is easy to hire and fi re, and where the welfare state is less highly developed and therefore cheaper. The US’ supposedly impressive record of job creation is held up as an example which ‘Europe’ should follow. Relatively high levels of unemployment are taken to mean that a country’s labour market is over-regulated.

The modern US’ apparent success in reducing unemployment through deregulation has been achieved by a number of methods, some of which are mere sleights-of-hand whilst others would be unacceptable to almost all EU electorates – which is not quite the same, unfortunately, as saying that they will never be implemented. American workers’ rights have everywhere been eroded. Wages are so low that it is now commonplace for people to have to do two or more



jobs simply to survive. Many jobs carry no (or inadequate) health insurance rights, a crucial matter in a system where public health care is extremely limited. An indeterminate number of people have been bullied off the welfare rolls, to scrape a living in the informal economy, or through prostitution or crime. Over a million people, mostly young men, are in prison. America has simply replaced its unemployed by a new sub-class of working poor. It is as if we are expected to believe that the essential problem is unemployment itself, rather than the poverty it engenders. Give the poor something to do and you’ve solved it. Of course, this ‘solution’ could be imported and would undoubtedly prove the same ‘success’ as it has in the US.8

Alternative views of employment generation have been growing steadily less infl uential since the Lisbon Strategy was originally adopted, and those of its elements which look to anything other than deregulation and liberalisation as a means to create jobs, whilst it would be misleading to see them solely as window-dressing, appear increasingly vague and diffi cult to quantify. Offi cially, Lisbon’s aims are broader than simple labour market targets, stretching to social and even environmental improvements. Much of the Strategy is aimed at moving in the direction of a ‘knowledge-based society’. It is, in fact, hard to imagine a society which was not ‘knowledge-based’, but what appears to be meant by the expression in this context is that there will be lots more computers everywhere, and, crucially, lots more people educated and trained to use them.

The achievement of the goal of becoming by 2010 ‘the most competitive and dynamic knowledge-based economy in the world, capable of sustainable economic growth with more and better jobs and greater social cohesion’ was not, it was stressed, to be achieved at the cost of the ‘European social model’.9 Unfortunately, nothing whatsoever was done to halt the erosion of that model by deregulation, liberalisation, the Growth and Stability Pact’s limits on public spending, or the ‘natural’ effects of the single internal market, so this commitment remained pious.10

HOW SUCCESSFUL HAS THE LISBON STRATEGY BEEN?

In May 2004 the Commission established what it called a ‘High-Level Group of Independent Experts’ under the presidency of former Dutch Prime Minister Wim Kok, whose independence was demonstrated by the fact that his turn-of-the-century government had begun the dismantling of the Netherlands’ once-impressive welfare state and



the erosion of its once reliable public services. Nevertheless, when the High Level Group’s report, Facing the Challenge, appeared in November, its criticisms had as much to do with the tendency of member states to forget that the Strategy was not supposed to be simply a liberalisers’ charter as they did with any failure to enhance ‘competitiveness’.

Facing the Challenge’s conclusion was that results were disappointing, that the 2010 goals, would not be met, and that structural reform had to involve more than an attack on labour rights, more than simple deregulation, but required also investment in training and in productivity. It even criticised the Growth and Stability Pact as a hindrance rather than a help to good economic management. Stressing once again the importance of sustaining the European social model, it advised the Commission and member states to do more to obtain popular support for the Strategy, which hardly anyone, in fact, has heard of.

According to Kok’s High Level Group, there was nothing wrong with the Strategy itself. On the contrary, it was the failure of the EU and its member states ‘to act on much of the Lisbon strategy with suffi cient urgency’ which was at the root of continuing problems, a failure which was largely due to ‘an overloaded agenda, poor coordination and conflicting priorities’ but also to ‘the lack of determined political action’.

The Report proposed ‘action across fi ve areas of policy’:

• increasing Europe’s attractiveness for researchers and scientists, making R&D a top priority and promoting the use of information and communication technologies (ICTs);

• completion of the internal market for the free movement of goods and capital, and urgent action to create a single market for services; reducing the total administrative burden; improving the quality of legislation;

• facilitating the rapid start-up of new enterprises; and creating an environment more supportive to businesses;

• developing strategies for lifelong leaning and active ageing; and underpinning partnerships for growth and employment;

• spreading eco-innovations and building leadership in eco-industry; pursuing policies which lead to long-term and sustained improvements in productivity through eco-effi ciency.



That these goals might not be compatible was not considered. The creation of an environment which was simultaneously more business-friendly and based on a sustained or even strengthened version of the European Social Model, for example, seems unlikely after a quarter of a century of persistent corporate-led assaults on that model and the tax-base which sustains it, but to whisper such things in EU circles is heresy.

The Group admitted that developments in the broader economy had been unhelpful to member states. Nevertheless they were at fault on a number of counts. They had not given suffi cient priority to completing the single market, for example, with only fi ve countries being up to speed on the transposition of internal market directives. Although there had been a slight rise in labour market participation, female employment and employment for older workers, these had not been great enough to give much hope that the targets would be met, especially as net job creation had begun to fall. R&D spending remained too low. Enlargement ‘while welcome, has made European-wide achievement of the Lisbon goals even harder’, because the ‘new Member States tend to have very much lower employment rates and productivity levels’.

The transformation of Europe’s economy into one which is ‘knowledge-based’ has, according to the Kok Group, simply not occurred. This is put down to ‘insufficient investment in R&D and education, an indifferent capacity to transform research into marketable products and processes, and the lower productivity performance in European ICT-producing industries (including offi ce equipment and semiconductors) and in European ICT-using services (such as wholesale and retail trade, fi nancial services) due to a slower rate of ICT diffusion’. In addition, the EU’s industrial sector is less oriented towards high-tech sectors than is that of the US, and it is in these sectors that most growth has occurred.

The Kok Commission, for all its relatively progressive-sounding rhetoric, shares the views upon which the Strategy is founded, that in order to maintain the European Social Model, workers must put in more hours, businesses must be required to pay less tax, and regulation should be as unexacting as possible. This sounds a little like destroying the model in order to save it, as it is surely based on such things as reasonable working hours, the acceptance (albeit reluctant) by enterprises of their social responsibilities (including paying taxes) and strong regulation to protect people in their roles



as employees and consumers, as well as the environment in which we all live.11

THE FUTURE OF THE LISBON STRATEGY

The Kok Group identifi ed ‘fi ve broad priority areas of policy where the European Union and individual Member States need to make progress to help both ensure its [sic] own economic dynamism and the vigour of the whole European economy from which each Member State benefi ts’. These it listed as the ‘realisation of the knowledge society, the completion of the internal market and promotion of competition, including services and fi nancial services, the establishment of a favourable climate to business and enterprise, building an adaptable and inclusive labour market, and the vigorous promotion of win-win environmental economic strategies are together sources of economic growth and higher productivity’. Moreover, it is ‘not the pursuit of any one of these objectives that will raise Europe’s productivity and growth, but all of them – obviously tailored to the particular position of national economies’.

In common with these broad generalisations, the Group’s more specifi c recommendations did not depart signifi cantly from the Strategy – it was, after all, their remit to assess its implementation rather than suggest reforms. It therefore stressed the vital importance of high levels of investment in research and development, removal of obstacles to free movement of scientists and other researchers (including those from outside the EU), an improved relationship between industry and universities, freer availability of risk capital, tax incentives for newly founded small and medium-sized enterprises (SMEs) that invest in research, and greater public fi nancial support for R&D at the EU and national levels. Public–private partnerships should be facilitated and encouraged as a means of boosting investment. ‘Europe’s science base should be strengthened by funding and coordinating long-term basic research ranked by scientifi c merit via the creation of a European Research Council’, urged the High Level Group. ‘At the same time, Member States and the Commission should look at ways in which public procurement could be used to provide a pioneer market for new research and innovation-intensive products and services.’ They also came down fi rmly on the side of the view that patents foster innovation, and that the patent system should therefore be extended to sectors where its use is controversial, principally computer software. A Community patent should be



introduced as soon as possible to foster innovation at European level in order to ‘reduce the complexity, time and costs of protecting intellectual property’.

Beyond this, the recommendations of the Kok Group begin to look wearily familiar. Obstacles to the free movement of services must be removed and essential services including electricity, post, rail and airspace fully liberalised. The internal market for fi nancial services must also be completed. State aid should not exceed 1 per cent of GDP, and public procurement rules must be updated. Welfare systems must be ‘modernised’. In other words, more of the same.12 As the European Trade Union Confederation (ETUC) complained, the Kok report ‘prioritised growth and employment at the expense of promoting social cohesion and sustainable development’.13

ETUC’s alternative, expressed in its Executive Committee’s resolution of December 2004 was ‘massive investment in positive labour market policies such as: Increased access to lifelong learning – Better social benefi t regimes, supporting unemployed and excluded people – Policies to reconcile work and family life – (and) Action to fi ght discrimination.’ In addition, ETUC called for ‘a European Social Investment Action Plan to help workers confront the challenges of delocalisation, restructuring and globalisation ... macroeconomic reform to stimulate demand and support growth by implementing a monetary policy that also has high growth (and not only low infl ation) as its policy focus, by making the Growth and Stability Pact more fl exible, and by urging the European Investment Bank to make full use of its lending options’. Above all, the ETUC insisted that social dumping, longer working hours and wage cuts must play no part in the second phase of the Lisbon Agenda. Opinions which had been entirely mainstream until the 1980s, however, were now out on a limb. From that precarious position, ETUC was barking at the moon.14

HEALTH AND SAFETY AT WORK

In the same way and for the same reasons that the single market has exerted downward pressure on wages and social benefi ts, it has forced employers to look for ways of reducing their costs. One obvious candidate has been health and safety in the workplace. In this area, at least, the European Union has taken action.

When it comes to international measures such as the fi xing of an EU-wide standard, health and safety at work is probably the least



controversial area of social policy. The biggest fi rms with the most power and infl uence tend also to be the ones with the best records of health and safety, being in the main relatively heavily unionised as well as most visible to the public and enforcement authorities. For this reason, they usually fi nd a reasonable level of health and safety protection acceptable. If standards were too lax, they would lose out in competition with fi rms in the least vigilant countries. Nevertheless, the Articles of the Treaty which give the EU competence in this area are at pains to stress that any measures must ‘avoid imposing administrative, fi nancial and legal constraints in a way which would hold back to [sic] the creation and development of small and medium-sized undertakings’.15 Though this is ostensibly designed to protect smaller fi rms from troublesome red tape, it can also be wheeled out as an argument against excessive (for which read effective) regulation in a particular instance where such might not suit the interests of industry.

The European Community has always enjoyed competence in this sphere and had previously conducted two ‘Action Programmes’, but its ability to take measures was greatly increased by the 1987 Single European Act which allowed decisions on health and safety in the workplace to be taken at Council by QMV. It was successfully argued by some governments that a unifi ed market demanded a common minimum level of protection for workers, and the main aim was to prevent ‘social dumping’, where companies move to countries with lower standards in order to cut costs.

A Third Action Programme was initiated in 1987, but the most important step came in 1989 with the adoption of a ‘Framework Directive’ (i.e. one designed to make possible actions targeted at individual problems). Fourteen ‘daughter’ Directives based on this framework (their mixed metaphor, not mine) were duly introduced, covering such matters as the safety of work equipment, personal protective equipment, working on Visual Display Units (VDUs), exposure to carcinogenic substances at work, individual industries (building, mining, quarrying, oil and gas drilling) particular groups of workers (pregnant women, young people, temporary employees) and identifi able hazards (ionising radiation, asbestos).16

A Fourth Action Programme ran from 1996 until 2000, and included the SAFE (Safety Actions for Europe) programme, through which small grants are available to SMEs to fi nance practical steps to improve working conditions. There was no further Action Programme after 2000, as the Commission’s view was that little or no new legislation



was now needed. Rather, the ‘comprehensive’ package already on the statute books must henceforth be better implemented. This is an area of legislation which has suffered more than most from the problem of compliance and enforcement. Several member states, including the UK, have been taken to the ECJ by the Commission for failure to comply with one or another directive, either by not introducing it into national law within two years, or by weakening it during transposition.

Instead of a new Action Programme, the Commission published a ‘Communication’ entitled Adapting to Change in Work and Society: A New Community Strategy on Health and Safety at Work 2002–2006. Placing the issue of health and safety squarely in the context of the Lisbon Strategy, the Commission nevertheless claims to base its approach on a recognition of ‘the emergence of new risks, especially of a psycho-social nature’. The Lisbon Agenda is clearly visible in the Commission’s statement that its plans to improve health and safety will be ‘based on consolidating a culture of risk prevention, on combining a variety of political instruments – legislation, the social dialogue, progressive measures and best practices, corporate social responsibility and economic incentives – and on building partnerships between all the players on the safety and health scene’. In plain English, this means that henceforth we will have to rely far more on the good will of employers and on voluntary measures than on solid legislation. For those who view the phrase ‘Corporate Social Responsibility’ as they might see ‘encouraging vegetarianism amongst tigers’, this is not encouraging.

Admitting that rates of occupational accident remain very high in sectors such as fi shing, agriculture, construction, and the extractive industries, and especially amongst SMEs, the Commission also recognises that new problems have arisen as a result of structural changes such as a reduction in job security for many workers and the increased participation of women in paid employment. The Commission nevertheless concludes that further regulation is not the answer. Instead, it proposes a mix of ‘quantifi ed objectives’, ‘mainstreaming the gender dimension into risk evaluation, preventive measures and compensation arrangements, so as to take account of the specifi c characteristics of women in terms of health and safety at work’, and tackling ‘stress, harassment at the workplace, depression and anxiety, and risks related to dependence on alcohol, drugs and medicines’. In addition, improved ‘prevention of occupational illnesses’ would give priority to ‘illnesses due to asbestos, hearing loss



and musculo-skeletal problems’. All of this must be underpinned by research allowing us to take account of the role of structural factors, of the relationship between the changing structure of employment and rates and types of occupational accident and illness, and of the age factor, specifi cally targeting young people and ageing workers. The ‘prevention culture’ must be ‘strengthened’ through education.

While no new measures – other than technical amendments, and possible ‘rationalisations’ and ‘simplifi cations’ of existing measures – are proposed, the Commission’s view is that ‘better application of existing law’ could be achieved, and although it again stresses the role of the worker’s and employer’s own ‘awareness’ in this, it promises to ‘adopt a rigorous approach to ensuring that directives are properly transposed and the law is properly applied’ and calls for ‘common inspection standards’. The Commission also pledges to issue guides on how to apply existing law. Research will also play a role in reducing occupational accidents and work-related illness, and the EU fi nances a research facility, in Bilbao, to study ways of improving workplace health and safety.17

Finally, the Commission does recognise the particular problem of enforcement of health and safety laws in the new member states, though its solutions are rather vague, amounting to little more than additional technical assistance.

INFORMING AND CONSULTING WORKERS

A further area in which the EU has long harboured ambitions is what it calls the ‘social dialogue’, the rights of workers to information, consultation and participation in the decision-making procedures which determine the policies of the enterprises in which they are employed.

An Agreement on Social Policy (ASP) appended to the Maastricht Treaty (signed by all the member states except the UK, which did not accept it until the election of a Labour government in 1997) laid down a clear system whereby, if management and unions agree, the Commission is obliged to put forward their agreement as a legislative proposal. The argument for this is that it is better for the two sides of industry, with deep knowledge of their sector, to seek a mutually acceptable solution to their problems, rather than having one imposed on them. On the other hand, the ASP removes the European Parliament from the process entirely, providing no representation for ordinary citizens whose immediate interests might also be affected.



To put it simply, it is all very well for rail owners and railway workers to do deals, but what about the passengers?

This was not, of course, the British objection to it. The ASP represents a tradition of ‘tripartism’, in which trade unions and employers’ groups are treated almost as partners in government. It is a tradition which has deep roots in many continental countries, where Christian Democratic parties occupy more or less the same point on the political spectrum as do Britain’s conservatives, and yet have their own affi liated trade unions. It is also one which had a brief heyday in 1960s and 1970s Britain, when trade unions enjoyed far more power and infl uence than is now the case. This was, of course, precisely what Thatcher’s Tories saw as the root of all of the ills which they had been elected to cure. Having fi rst marginalised the trade union movement and then, with the Miners’ Strike of 1984–85, used every legal, extra-legal and downright illegal method she could think of to destroy it, Thatcher was not about to allow it to sneak back in from across the channel.

Though Britain has always been out on a limb, differing traditions and practices have also made it diffi cult for the other member states to reach agreement, and such directives which have survived their course through the Council have been extremely limited in force. The 1975 Directive on the Approximation of the Laws of the Member States Concerning Collective Redundancies, for example, requires employers to negotiate with workers in the event of mass redundancy, a somewhat meaningless obligation and one which is, in any case, not properly enforced. This was amended in 1998, but without strengthening workers’ rights. It should also be noted that a number of cases, including the notorious closure of Renault’s profi table, state-of-the-art factory in Vilvoerde near Brussels in 1997, demonstrate that the Commission lacks the will to enforce even those limited rights which the Directive supposedly gives them. Other important directives are as follows:

• 1977 (amended 1998) on the Approximation of the Laws of the Member States on the Safeguarding of Workers’ Rights in Conjunction with the Transfer of Undertakings: workers must be informed of the reasons for the transfer and the consequences.

• 1978 on Mergers of Limited Companies, gives similar rights to those affected by mergers.



• 1994 on the introduction of European Works Councils: the fi rst Directive adopted under the ASP, it gives workers in large multinational companies the right to form transnational Works’ Councils which management must consult.18

EQUAL OPPORTUNITIES AND EQUAL RIGHTS FOR MEN AND WOMEN

Because of their higher unemployment rates, greater child care responsibilities and longer life spans, the undermining of welfare and other social provision since the imposition of the Convergence Criteria and the Stability and Growth Pact has had its most immediate impact on women. However, as in other areas of policy the EU has succeeded in cultivating a progressive image by means of policy initiatives which, though hugely outweighed by the damage done by other measures, are more direct and more visibly attributable to the Union.

The Treaty of Rome was certainly ahead of its day in asserting the principle that men and women should receive equal pay for equal work. It was 18 years, however, before a directive was adopted which attempted to put this into practice.19 Further legislative measures have followed, covering access to employment, vocational training and promotion, and equality in working conditions (1976), state social security (1978), occupational social security schemes (1986 and 1996), extending rights to self-employed women (1986), health and safety for pregnant workers and those who have recently given birth or are breast-feeding (1992), and placing the burden of proof in cases of employment discrimination based on sex on to the employer (1996). In addition, a framework agreement on parental leave was concluded in 1996 by employers’ body UNICE, the CEEP (representing smaller fi rms) and the European Trade Union Confederation. Two framework agreements negotiated under the ASP cover parental leave (1996) and part-time work (1997), both matters of particular interest to women.20

The EC/EU’s competence with regard to gender discrimination did not, under the Treaty of Rome, extend beyond the workplace or matters, such as social security, closely connected with employment. Amsterdam extended it as part of a general broadening of the principle of non-discrimination to situations outside the world of work and to groups other than women.



As well as legislative measures, the EC/EU has conducted a series of Action Programmes, the fourth of which concluded in 2000. It also fi nances a ‘Community Instrument’ (Employment NOW – NOW originally took its name from ‘New Opportunities for Women’, an earlier Community Instrument) under the European Social Fund, specifi cally aimed at improving opportunities for women. The ‘Employment Guidelines’ around which the member states are supposed to design their annual labour market programmes specifi cally call for strengthened equal opportunities policies. Finally, after casting it into doubt in a case heard in 1995,21 in 1997 the European Court of Justice upheld the legality of affi rmative action in relation to areas of employment or levels of a profession where women are under-represented.22

Most recently, EU action in this area has been organised around the Community framework strategy on gender equality (2001–05). The central idea now is that gender issues must be ‘mainstreamed’ into all policies. The strategy was initially laid out in a Commission Communication of 2000, the major points of which were, fi rstly ‘a dual-track approach’ in which ‘gender mainstreaming in all Community policies having a direct or indirect impact on the gender equality objective’ would be coupled with the introduction of special measures for women which were, the Commission stated, ‘still needed to remove persistent gender inequalities’. This would involve, in addition ‘a supporting programme for the framework strategy to provide back-up for organising awareness-raising campaigns, improving data collection and implementing transnational projects’. The strategy has fi ve strands:

• Promoting gender equality in economic life (reducing occupational segregation, helping to reconcile working and family life, strengthening the gender dimension in the European Employment Strategy, encouraging lifelong learning and access to active labour market measures for women and promoting their employability and access to Information Technology (IT) jobs, improving the use of the Structural Funds for the promotion of gender equality, developing a dialogue with the top management of enterprises operating in Europe on their contribution to gender equality in economic life, and possibly creating a European label, equality prize or certifi cate to be awarded annually to enterprises which have developed good practice to promote gender equality).



• Promoting equal participation and representation (improving the gender balance in political, economic and social decision-making, including within the Commission itself).

• Promoting equal access and full enjoyment of social rights for women and men (improving the application of European legislation, particularly on social protection, parental leave, maternity and working time, through inter alia raising awareness among NGOs, trade unions and employers, labour inspectorates and the legal profession about relevant EU legislation, monitoring the integration of a gender perspective in the design, implementation and evaluation of Community policies).

• Promoting gender equality in civil life (strengthening enforce-ment mechanisms, training on equality rights and the human rights of women, especially those, such as migrant women or women with disabilities, subject to multiple discriminations or women who face violence or sexual exploitation; monitoring Community law and case law on equal treatment for women and men and, if required, proposing new legislation, including reviewing Directive 75/117 on equal pay; promoting women’s rights as human rights by supporting awareness-raising campaigns in the EU and in the applicant countries; fi ghting gender-related violence and traffi cking of human beings for the purposes of sexual exploitation).

• Promoting change of gender roles and stereotypes (raising awareness about gender equality, overcoming gender stereotypes in and via relevant Community policies).

The Action Programme based on this Communication took various modest measures to put this into effect. Programmes to counter sexual traffi cking and violence against women did help to raise the profi le of the issues. These are welcome developments, though it is important to remember that the broad thrust of EU policy has greatly increased pressure on the women whom these programmes are designed to help, so that the Union is at least partly responsible for the problems they are seeking to ameliorate.23

DISABILITY AND AGEING

The EU has very limited competence in relation to issues connected with ageing, disability, and social exclusion or poverty. It has, however,



undertaken a number of Action Programmes, including three aimed at disabled people (the HELIOS programmes), largely confi ned to sharing experiences between schemes in different member states and promoting best practice. It also supports and consults a European Disability Forum representing a range of NGOs. A Community Instrument (Horizon) provides fi nancial support for disabled people in vocational training. The 1998 and 1999 employment guidelines also draw attention to the particular diffi culties facing disabled people on the labour market. Finally, following a Council Recommendation of 1997, disabled drivers can claim the same rights and privileges when visiting another member state as can residents of the country they are visiting. Proposals for improved accessibility to public transport vehicles have so far foundered in Council, largely due to the expense.

The ‘mainstreaming’ of disability policy called for in a 1996 Commission Communication has made little progress. New anti-discrimination provisions introduced at Amsterdam have given the EU more potential to act, but the results are still awaited. The fact that 2003 was declared the European Year of the Disabled did nothing to alter this. Economic slowdown and the problems occasioned by enlargement hindered the mainstreaming of disability issues, so that while the social affairs directorate general of the Commission shows concern and awareness, this is rarely shared by those dealing, for example, with transport. Again, the neoliberal exigencies of the Lisbon Strategy mean that any positive developments are no more than palliative.24

The EU has even less competence to act in relation to retired people than it does over disability. Pensions remain the exclusive province of the member states, as does the power to establish a minimum income, housing conditions and health care. Taken together, this means that the major determinants of quality of life for people beyond the age of retirement are dealt with by national and local authorities.

This has not prevented the Commission from instigating an Action Programme (1991–93), and a European Year of the Elderly and Soli-darity between the Generations (1993). This attempt to reach out of its area of competence was curtailed in 1996 when the UK Conserva-tive government successfully contested the Commission’s plans to allocate 6.5 million ECUs of the 1996 budget for measures on behalf of the elderly. Since then, nothing very much has been done, and the twin strands of the prevailing attitude to older people can de dis-cerned from the fact, fi rstly, that they are classed with the disabled in the index of measures,25 while the principle concern evident from



the Commission’s approach is summed up by the heading ‘increas-ing the employment of older workers and delaying the exit from the labour market’. The Commission propagates the myth that Europe’s ageing societies will increase the dependency ratio of workers to non-workers. As, demographically, more old people almost always means fewer children, this is patently not the case, especially as, in devel-oped countries, children are a dead weight on the economy while old people are often highly productive in the non-wage economy as child carers, volunteer workers and in many other capacities.26

EDUCATION AND TRAINING

Prior to Maastricht, an artifi cial division had arisen within EC policy-making, between ‘training’ on the one hand, and ‘education’ on the other. The reasons for the division were understandable. The Community began life as an ostensibly purely economic project: ‘training’ implies preparation for a job, in other words to take one’s place as a productive member of the economy. ‘Education’, on the other hand, has (or ought to have) a major non-vocational element. Given that a large part of this, at least in most countries, has to do with national culture, tradition and religious and other beliefs, the member states were wary of handing over competence to a supranational body. In practice, by the 1980s education aimed at adults (including university level courses) was seen as a legitimate area of interest for the Community. This was formalised at Maastricht and Amsterdam, so that now the EU has limited but clear competence over education as well as training. Member states retain responsibility for their education and vocational training systems, with the EU’s role being confi ned to encouraging co-operation between member states and taking measures which support or supplement their own actions. In practice this takes the form of a number of programmes. Socrates was launched in 1995, and is now in its second phase, which began in January 2000 and will run until 2006. With a budget of €1,850 million, Socrates is divided into eight ‘Actions’:

• Action 1, Comenius (covers pre-school to secondary education) and is aimed at ‘reinforcing the European dimension of school education’, encouraging transnational co-operation between schools.

• Action 2, Erasmus (higher education), encourages transnational co-operation between universities and mobility of university students.



• Action 3, Grundtvig (adult education and other educational pathways), seeks to encourage the European dimension of life-long learning.

• Action 4, Lingua (teaching and learning of languages).• Action 5, Minerva (open and distance learning, information

and communication technologies in education).• Actions 6, 7 and 8 (small innovatory and experimental

programmes).

Leonardo Da Vinci is a separate Action Programme aimed at vocational training. First established in 1994, on the completion of the initial phase in 1999 it was extended, with a budget of €1,150 million, until 2006. In addition to these specifi cally educational or vocational-educational programmes, the Youth for Europe Programme embraces a number of exchange schemes aimed at involving young people in work for the community outside their own member states and in the developing world. A number of other small schemes encourage co-operation and exchanges with developing countries in the fi elds of education and training.

As well as funding students and direct work with young people, the EU has, despite its restricted competence, taken initiatives bearing directly upon education. Principal among these was the Commission Communication Education and Training 2010, which bemoaned what it described as ‘a shortfall of investment in human resources in the Member States compared with the US and Japan’. On the basis of this assessment, the EU member states plus a number of other European countries signed the Bologna Declaration on the European Dimension for Higher Education of 19 June 1999, committing themselves to a coordinated development of a ‘European dimension for higher education’.

Finally, the diffi cult business of mutual recognition of qualifi cations has continued to make painfully slow headway.27 Students in higher education are able to take advantage of a European Credit Transfer System enabling them to move between universities in different member states, though its scope remains limited.28

THE EUROPEAN SOCIAL FUND

The most signifi cant source of support for vocational training is, despite this plethora of Community Instrument, the European Social Fund (ESF), which is the main fi nancial tool through which the



European Union translates its strategic employment policy aims into action. The ESF provides ‘matching’ funding for training and other employment initiatives, though this is usually in the form of ‘matching funds’: an equal, or some, proportion of the money needed for a project must come from national sources. ESF funds concentrate on poorer regions and those with problems brought about by economic change, for example those areas historically dependent on heavy industries. The idea is to generate a virtuous circle through which private capital will be attracted to these regions. In addition, the ESF attempts to encourage international co-operation, the sharing of best practices, and innovative approaches to the problems involved.

Following the reform of the Structural Funds at the beginning of 2000, the ESF was given fi ve priorities:

• development of active labour market policies to combat and prevent unemployment, to avoid long-term unemployment, to facilitate the reintegration of the long-term unemployed and to support integration into the labour market of young people and persons returning to work after a period of absence;

• promotion of equal opportunities for all in terms of access to the labour market, with particular attention to persons at risk of social exclusion;

• promotion and improvement of vocational training, education and counselling in the context of a lifelong learning policy;

• promotion of a skilled, well-trained and fl exible workforce, innovative and adaptable forms of work organisation, and entrepreneurship;

• specifi c measures to improve access and active participation of women in the labour market (career prospects, access to new job opportunities, setting up businesses, and so on).29


12The Environment and Public Health

Environmental law, although it was unmentioned in the original Treaty of Rome, is now a major feature of European Union activity. The fi rst European Community Environmental Action Programme (EAP) was adopted in 1973, and the Union is now on its sixth. Each successive Programme has been much more wide-reaching and ambitious than its predecessor.1

This in part refl ects the increasing urgency and seriousness of such problems as pollution of seas, waterways and the atmosphere, climate change, contaminated food and new technologies. Awareness of the importance of such issues was confi ned to a fringe in 1957 when the Treaty of Rome was signed and the Community established. In 1961 with the publication of Rachel Carson’s seminal text Silent Spring, modern environmentalism was born, and since then we have seen the environment move to the top of many people’s concerns, the rise of Green parties and movements and the ‘greening’ of progressive politics in general. Nowadays even the major corporations which continue to pollute the planet feel the need to pay lip service to environmental responsibility.

These developments have been accompanied by the gradual weakening of resistance to the centralisation of power at Community level, a greater acceptance by the member states of organs of co-operation which are at least partly supranational or federal in character. This is less controversial in fi elds where there is a clear transfrontier aspect to an issue, and environmental problems in general fi t this bill. In practice, however, the member states, whilst recognising that international decision-making bodies are needed to confront problems which do not respect borders, have been reluctant to hand over the sort of power which might, in theory, enable the EU’s centralised institutions to get to grips with the environment. Given that EC/EU policies have done a great deal to bring about the environmental crisis which we are facing, member states can hardly be blamed for hesitating before handing over powers to tax, fi ne and subsidise – the ‘instruments’ which the European Commission has proposed to the Council, on a number of occasions, as means to further environmental policy. The Common Agricultural Policy (CAP),

119



which gives the European Union more centralised power than it enjoys in any other area, is hardly inspiring as a green credential.

On the other hand, specifi c pieces of legislation have often met with a degree of success in tackling the problems to which they are addressed, at least slowing down or even reversing the pollution of the atmosphere and water courses, for example. Furthermore, in the case of at least some real areas of policy – the protection of migratory birds, for example, or the establishment of nature reserves – blame lies squarely with the member states who, having agreed to potentially effective directives (at a time when unanimity was still required) have failed to implement them.

The EU’s limited successes in the environmental field have, however, also been offset by a clear failure to adopt a coherent overall strategy and the virtual collapse of attempts to green other areas of policy such as those affecting industry and transport, as well as the notorious CAP itself. Much-vaunted agricultural reform has led to a widespread assumption that the structural problems affl icting EU agriculture have somehow been dealt with, or at least that things are better than they were. In fact, the impact of the inadequate steps taken has so far been extremely limited, doing little to halt the ravaging of the countryside.

The arrival of genetically modifi ed crops, mercifully still to a large extent stalled but set to take off following the reform in 2003 of the system governing their approval, shows that the caution induced by the BSE and dioxin scandals melts away all too quickly in the heat of the power and infl uence of multinational corporations. The fact that since the reforms at Maastricht and Amsterdam, environmental policy is subject in general to the co-decision procedure, gives the European Parliament a relatively powerful role, which has generally been to the overall benefi t of environmental and public health policy, though this is tempered by the fact that at every stage of the legislative process MEPs are lobbied heavily, often with impressive results. Although the environmentalist lobby in Brussels is highly active and well-organised, it cannot compete with the massively funded disinformation machine employed by corporations. For NGOs which form the umbrella European Environmental Bureau, success might bring good publicity and help to recruit members or boost fundraising. For a corporation, the success or failure of an amendment to a directive can mean millions of euros.

In addition to the damage wrought by the CAP, the EU must answer for the billions of euros of structural fund money spent on


The Environment and Public Health 121

worthless or damaging projects for roads, dams, airports and all the rest of an unlovely and poorly-planned infrastructure. Afforestation programmes destroy traditional landscapes and replace them with serried ranks of alien species of trees, woods which undermine biodiversity and can cause untold and unpredictable damage to water courses and other features of environmental, economic and aesthetic importance. All of this is carried out despite the ostensible requirement for an Environmental Impact Assessment (EIA) for most major infrastructure projects.2

Subsidies are paid for unmarketable crops – Greek tobacco, most notoriously, but also the environmentally destructive rice plantations of Northern Italy – and then further subsidies given to enable their export. Meanwhile, the CAP’s troublesome little brother, the Common Fisheries Policy, has failed to save either the fi sh or those who catch them from near and possibly imminent extinction.

The drive for a single internal market at all costs has also produced anomalies which can range from the absurd to the catastrophic. Potatoes, grown in Northern Germany, are driven south to be washed and packed, then taken back to their birthplace for sale. Apples are driven back and forth, traded between member states, despite the fact that almost every EU country grows them. If this meant greater variety, at least there would be some point to it; in fact, the range and variety of apples available in each member state has declined as a direct result of the CAP, as well as of the intensifi ed competition brought about by the single market. The necessary transport requires infrastructure, of course, which generally means roads. These are built, moreover, at the taxpayers’ expense, despite the fact that the vast majority gain nothing whatsoever from the deal.

The term ‘mainstreaming’ indicates that a particular goal – originally it was applied to gender equality – is borne in mind whenever policy is formulated, not merely when policy is formulated which from the outset is aimed at that goal. For example, the point of building a road is not to improve the environment but to make it easier for people and goods to get to and from the places served by the road; but a ‘mainstreamed’ environment policy would set out to ensure that the road was absolutely necessary, that it was built with as little damage as possible, and that it met criteria based on an ecologically conscious cost-benefi t analysis. Mainstreaming has been incorporated into the Treaty since Amsterdam, Article 3D of which states that ‘environmental protection requirements must be integrated into the defi nition and implementation of Community



policies and activities …’ These fi ne words, however, remain a long way from being translated into any discernible impact.

The Fifth Environmental Action Programme, ‘Towards Sustainability’, which expired in 2000, was the first to give prominence to the idea of a ‘horizontal approach’ which would affect policies whose primary purpose was not environmental. Industrial policy, energy, transport, and individual sectors such as agriculture, fi sheries and tourism would henceforth be expected to take account of the principles of sustainable development. Unfortunately, in practice huge pressures work in a direction antagonistic to such a principle, prominent amongst which are the enormous infl uence of big corporations on EU decision-making, the environmentally destructive methods imposed by the CAP, and the obligations entered into by the Union and its members in the WTO and other international agreements.

Legislation tends to be most successful when it accords with the interests of industry, especially if that industry is dominated by big corporations and located predominantly in one of the powerful member states. Thus, whilst the idea that German corporations, for example, care one way or the other about the environment is faintly absurd, the fact that they care about their competitiveness is self-evident. Relatively strong regulation in a powerful member state can thus mean that, in some cases, its government and industry leaders actually demand stronger measures elsewhere. Poorer states can sometimes be persuaded to accept higher standards by offers of fi nancial assistance, or trades can be made along the lines of ‘You vote for my tight emission controls and I’ll make sure you don’t have to do anything about enabling disabled people to use your public transport.’ The results are, to put it kindly, patchy, as one would expect from a body of legislation driven by commercial considerations rather than genuine concern for the long-term future of the planet or the immediate wellbeing of the people who live on it.

Pressure also comes from public opinion, and no doubt even from the critical nature of what is happening to the planet. Restrictions which do not overly inconvenience corporate industry or agriculture have always a chance of seeing the statute books. It is, however, highly signifi cant that the fi rst environmental proposals to be dealt with by QMV – following the Single European Act of 1987 – were those which affected the internal market. While this was a clever way to get a foot in the door, the priorities it takes for granted are disturbing. To trade is, apparently, more important than to breathe clean air or



drink fresh water. Maastricht extended QMV to almost all aspects of environmental policy, but these priorities have not changed.

The usefulness of policies emerging from these confl icting pressures varies hugely. Widespread criticism of the Fifth EAP illustrates this. Its effectiveness was widely seen as undermined by vague and sometimes unrealistic targets, and avoidance wherever possible of binding measures. Member states were, following the principle of subsidiarity, given major responsibility for implementing the programme, but this created a problem of monitoring and enforcement which they seemed ill-inclined to address. It is hard to escape the conclusion that member state governments are happy enough to purchase a green image with their successors’ money, agreeing to expensive measures knowing that whilst they will get the credit, they will be retired or out of offi ce before the bill arrives.3

Enforcement has never been Brussels’ strength. In the 1980s, the Third Action Programme devoted all of three lines to the problem of implementation. Even now, the Directorate-General for Environment lacks the enforcement powers and personnel enjoyed by those which deal, for example, with competition policy or fisheries. Implementation is also not aided by the fact that individuals have no right to proceed against their governments for non-compliance with EU law, a right which exists in other spheres, for instance in relation to employment-related legislation.

Whether the Sixth Environmental Action Programme will succeed in remedying these defects remains to be seen. Priorities include climate change, the environment and health, protecting nature and biodiversity, and resource and waste management. These are so broad as to be almost meaningless, however. If the EU is to build on its limited and partial successes in reducing industrial emissions of harmful gases and particles, cuts in phosphorus, lead and mercury in the general environment, or reduced acidifi cation of forests and water courses, then it will need to use these broad categories as a starting point for tough, specifi c and well-targeted action. Its past record does not bode well.4

KYOTO

The United Nations Framework Convention on Climate Change (UNFCCC) and the Kyoto Protocol appended to it have been signed and ratifi ed by the EU and all of its member states. The Protocol obliges participants – which means every signifi cant country on



earth with the notable exceptions of the United States and Australia – to establish national programmes for reducing greenhouse gas emissions. Industrialised countries, so loosely defi ned that all 25 EU member states are included – had to aim to stabilise their greenhouse gas emissions at 1990 levels by the year 2000.

Under the Protocol, the EU committed itself to reducing its greenhouse gas emissions by 8 per cent during the fi rst commitment period from 2008 to 2012. The burden is shared between the member states under a legally binding burden-sharing agreement, which sets individual emissions targets for each country.

In keeping with the spirit of the age, the Kyoto Protocol sees the market as a potential mechanism for solving a problem which even its staunchest defenders admit it helped to create. As well as taking direct steps to reduce their emissions, countries and enterprises may participate in the Clean Development Mechanisms (CDM), under which developed countries and polluting fi rms within them may gain credits by transferring emission-reducing technologies to developing countries. Joint Implementation (JI) is a similar system, the difference being that it applies to deals between developed countries or fi rms based in them. Where the market idea really becomes clear, however, is in relation to emissions trading.

Under the Protocol’s rules, each Annex 1 state, as the developed countries are known, agreed to cut its emissions by a certain quantity. Emissions trading, however, gives them an option. An international exchange has been established where ‘right to pollute’ credits may be traded. If a corporation or country believes it can better achieve its quota by buying someone else’s emission credits – units allocated according to each country’s agreed level of emissions – then it may, within certain restrictions, do so. The system is designed to work like a normal stock exchange, and whether companies opt to buy credits or take direct measures to reduce their own emissions will clearly depend on the market-determined price of a ‘right-to-pollute’ credit.

The EU is also using this system internally. Although the ten member states who joined in May 2004 have in each case their own emission allowances and reduction targets, those for the EU15 were negotiated en bloc. This has meant that these countries have subsequently had to agree a division of the burden. This has been successfully achieved and it is this which gives the Union an opportunity to operate an internal system of emissions trading. This began in January 2005 and while it is too early to assess the degree



to which it has been successful in its own terms, a number of general criticisms can be made.

Firstly, because a country’s credits are based on so-called ‘grandfathering’, i.e. on how polluting they were in the past, the historically most polluting countries have a head start. Although member states will acquire the right to participate directly in the system, it is initially intended to operate at the level of the fi rm, and a member state’s fi rst task was to distribute credits to the fi rms in the sectors included. This again meant that the fi rms which had produced the most pollution in the past would be given the biggest right to pollute in the future.

A second problem is that the six greenhouse gases do not only provoke climate change but are also, to varying degrees, atmospheric pollutants responsible for various other public health and environmental problems. In most countries, moreover, the industries responsible for them tend to be found in the areas where the lowest-income groups are also concentrated. Emissions trading does nothing to address the accompanying problems associated with atmospheric pollution and may even help to perpetuate them. If you live in the shadow of an industrial plant belching out fumes which are destroying your children’s health, it is little consolation to know that the fi rm which owns it acquired the right to do nothing about the problem by honestly buying emission credits from a company 2000 km away on the other side of Europe.

Emission credits also make no distinction between ‘end-of-pipe’ solutions and those which reduce the actual quantities of polluting fuels burnt. ‘End-of-pipe’ solutions – variously known as fi lters, scrubbers, and so on – work by lowering the amount of pollutant resulting from the burning of a given amount of fuel. Whilst this is certainly a worthwhile achievement, it does not affect the amount of fossil fuels dug or pumped out of the ground, or the numbers of nuclear power stations built, or the number of biodiversity-rich forests destroyed for the building of mega-dams.

Finally, even according to the most optimistic estimates, the emissions trading system will make only a small contribution to reducing emissions. The system is moreover unnecessary, because the problem could be solved by redesigning transport systems, developing and implementing alternative technologies and, above all, conservation measures, and through technical improvements increasing the effi ciency of fuel use. These, however, would involve



the kind of radical steps which the EU and its member states persist in refusing to take.

This failure has meant that although the EU reduced its emissions by 3.3 per cent between 1990 and 2000 and thereby met its initial commitment under the Protocol, emissions then began to rise. In fact, the initial target was achieved largely because German reunifi cation led to huge drops in output in the former GDR, the UK moved from coal to gas as a principle source of energy, and the steel industry in most parts of the EU15 collapsed, removing a major source of pollution. Emissions have been reduced in manufacturing industry, the energy sector and from including households, but this is being increasingly counterbalanced by rocketing CO2 emissions from transport as Europe disappears under concrete and tarmac.5

GMOs

From 2001 to 2003, after long, hard negotiations between the Commission, Council and Parliament and in the face of a massive and unscrupulous lobbying effort by the giants of agricultural biotech, the EU introduced a raft of new laws governing genetically modifi ed organisms and goods produced from them. These new laws were made necessary because following a number of food-related health scares, public disquiet had reached a level where people were simply not willing to accept the word of industry-hired scientists and politicians with a proven track record of telling bare-faced whoppers. Under pressure from this discontent, member states were refusing to authorise any more releases of GMOs into the environment or any new GMO-based products. Everyone wanted new laws: the EU authorities and most member states because they had come to the conclusion that they could continue to develop agricultural biotechnology only when the public was confi dent that they were being protected from the potential dangers; the industry because they reluctantly accepted the same reasoning; the broad public because they wanted such protection; and an increasingly signifi cant and active slice of the population who had decided that they neither needed nor wanted GMOs and wanted them stopped.

These considerations led the EU to ratify the Cartagena Convention on Biosafety, an international agreement governing trade in GMOs, which itself necessitated changes in European and member state law. New laws were introduced governing the deliberate release of GMOs and requirements for GMO-based products. They established a system



based on traceability, under which GMOs could be tracked ‘from fi eld to plate’. The authorisation procedure was designed to ensure that only GMOs which are safe for human and animal consumption and for release into the environment could be placed on the European market. Labelling rules are designed to allow farmers, other users and consumers to choose whether or not to purchase such products. Some areas of the law remained vague and others decidedly unsatisfactory. Thresholds for contamination, permitting the inadvertent presence of GM materials up to a level below which they would not need to be labelled, were set far too high. EU member states do not have the right to exclude GMOs from their territory, either to prevent their cultivation or to keep them off supermarket shelves, whatever their citizens may want. Nevertheless, the EU and its member states now have the strictest system of control of agricultural biotechnology of any country or bloc in the world. Whether these will prevent their further development, or, as the industry hopes, reassure the public and bring them round to accepting genetically modifi ed foodstuffs and other products, it is too early to say. One of the missing elements which may now be addressed relates to the question of ‘co-existence’, the growing of conventional or organic crops alongside GM varieties. Initially the Commission stated the belief that this should be left to the member states to organise. It would be wrong, they argued, to take decisions over such matters as exclusion zones centrally, when they could be affected by so many local conditions. This reasoning was little short of absurd, given that all other aspects of the GMO-related legal code had been determined centrally. In 2005, the possibility of changing this decision began to emerge, with the Commission asking member states to report on their experience of the system to date and promising, in the face of such reports, to ‘refl ect on possible further steps’.6

REACH: A NEW FRAMEWORK FOR CONTROL OF CHEMICALS

In relation to EU environmental policy, one of the greatest areas of controversy during the fi rst years of the century concerned the proposal for a new regulatory framework for chemicals. Known as REACH (Registration, Evaluation and Authorisation of CHemicals), the proposal would require firms manufacturing or importing more than one tonne of any given chemical substance per year to register this in a central database. Replacing more than forty existing Directives and Regulations, REACH would also require companies



to assess the risks arising from their use and to take the necessary measures to manage any risk they identify, reversing the burden of proof from public authorities to industry for ensuring the safety of chemicals on the market. The public authorities could evaluate any substance where they had reasons to suspect that there was a risk to human health or the environment. Substances regarded as potentially dangerous would require authorisations for particular uses from the Commission. If the risks emanating from the use of such a substance could be adequately controlled, authorisation would be granted. If not, the Commission would assess the level of risk, whether the use of the substance in question was socially and economically important and whether there were substitutes. It would then decide whether is should be authorised and if so, whether restrictions should be imposed.

According to the Commission, ‘The proposed new system would set high standards for protection of health and the environment while safeguarding the competitiveness of enterprises and improving the potential for product innovation. This balance would be to the long-term benefi t of chemicals manufacturers, importers, users, small and medium sized enterprises, consumers and for health and the environment.’

Whether this will turn out to be the case or not remains to be seen. In the face of this blatant attempt to intrude upon the chemical industry’s inalienable right to poison us, lobbyists descended on Brussels in unprecedented numbers, and the signs were that the proposal would be weakened in both Council and Parliament before what was left of it became law.7

PUBLIC HEALTH

Public health and the environment are clearly, as political issues, diffi cult to separate. They are dealt with by the same Parliamentary Committee, for example, although responsibilities at the Commission are divided between the Directorate-General (DG) Environment and that for Public Health and Consumer Affairs, known, from the French, as DG Sanco. The two policy areas are also separated at EU level by the question of competence, however, for the Union did not acquire any powers in relation to public health until Maastricht.

On the basis of the competence acquired in that Treaty, eight Public Health Programmes have since been conducted, covering such matters as communicable diseases, cancer, accident prevention and



environmental sickness. In addition, statements of various kinds have been issued regarding, inter alia, the safety of human blood and blood products for medical use, the integration of health-related goals into other EU policies, and the fi ght against tobacco. A network has been established for research and other co-operation in the struggle against communicable diseases.

If this seems limited – and the amounts of money involved do tend to be relatively small – then it must be remembered that the EU’s competence in relation to public health remains very limited, and that the member states continue jealously to guard their right to control their own health systems. Every member state enjoys a health care system which is predominantly publicly funded and which is heavily subsidised, in some cases free, at the point of care. This makes harmonisation diffi cult, for any attempt to harmonise raises the thorny question of who pays for what. The result is that the EU’s input, for good or ill, is largely confi ned to supporting actions controlled by the member states, and encouraging the spread of what it sees as ‘good practices’.

An evaluation of the eight programmes, all of which came to an end in 2002, was carried out the following year. On the basis of this evaluation, a broader, less disease-specifi c approach was adopted and a new six-year programme established with three strands: exchange of medical information, including, controversially, on the effectiveness of health systems, an exclusively national competence; strengthening rapid response capacity, particularly in relation to co-ordinated reactions to major threats to health including bioterrorism and potential global epidemics; and targeting actions to promote health and disease prevention by tackling the key underlying causes of ill health.

Although the programme is small, with a budget of only €312 million, aspects of it fuel the suspicion that major inroads may be in the process of being made into this until recently unquestioned national competence. The original proposal for a Directive on Services in the Internal Market, the infamous Bolkestein Directive, for example, included health care in its scope. Though roundly condemned by both Parliament and Council, it was no more than a logical conclusion to the path which the EU has taken since Maastricht, where the market is seen in principle as a suitable form of organisation for any sector of the economy. Talk of a Directive on Essential Services, explicitly removing health care and certain other vital service activities from the usual rules of the internal market, and



recognising their fundamental difference from other traded services, has failed to bear fruit. Disquiet over this is certainly not confi ned to the left, with members of the EPP, the Parliament’s centre-right group, including former Tory health minister John Bowis, declaring major aspects of the proposal unacceptable as they impinged on health care.

One of the issues to which Bowis and others across the political spectrum most strongly objected related to the controversial matter of patients who go from their home country to another member state seeking treatment. The classic case would be, say, a heart patient who is placed on a waiting list by the NHS, condemning him to further months of anxiety and discomfort. He then discovers that the operation is available straight away in another member state. EU rulings give him the right to take advantage of this availability and under certain conditions to claim reimbursement of the cost from his own health service which has, after all, been spared the expense of his treatment. The proposed Services Directive would, however, have forbidden member states from imposing a duty on this patient to seek prior consent, potentially plunging state-funded systems into chaos and making fi nancial planning extremely diffi cult. Moreover, a system such as the NHS where most treatment is free at point of care is not designed to operate along market economy lines and might well have to add a whole layer of bureaucracy in order to cope.

FOOD SAFETY

The numerous food scares of the 1990s led to a decision to establish a new, centralised scientifi c institution capable of providing what we are assured will be independent and objective advice on food safety issues. Beginning life as the central proposal of the Commission’s White Paper on Food Safety, the only question would be the extent of the body’s authority. In the end, despite its name, the European Food Safety Authority (EFSA), bowing to subsidiarity, was given no more than an advisory role to fulfi l its task of restoring ‘consumer confi dence’ or, more specifi cally, ‘… contribut(ing) to a high level of consumer health protection in the area of food safety, through which consumer confi dence can be restored and maintained’.

Based in Parma in Italy, a city famous for both cheese and ham, EFSA provides expert advice on the safety of food and animal feed, as well as on related issues such as nutrition, animal welfare and



plant protection. An important aspect of this is the preparation of risk assessments for use in the development of policy.

Established in 2002, EFSA’s effectiveness will clearly depend upon the extent to which it is able to maintain its independence in the face of the kind of industry pressure which has undermined similar institutions in the US, where a revolving door between public authorities and major food corporations has led government into such absurd positions as the view that GMOs are ‘substantially equivalent’ to their natural parents, or that feeding growth hormones to cattle is by defi nition ‘safe’.8


13The Common Agricultural Policy

and Common Fisheries Policy

The Common Agricultural Policy, the most important and costly of European Community actions, was constructed in the 1950s by people whose memories of depression and war were still fresh. It was designed to ensure that the people of the six founder states would never again go hungry. In meeting this aim it has been spectacularly successful, delivering a quantity and variety of food which has ensured that all but the very poorest have access to an adequate diet. Why, then, is the CAP, more than any other aspect of the European integrationist project, not only the bête noire of sceptics and opponents of the Union, but an embarrassment to its staunchest supporters?

The CAP’s central goal was, until recently, to increase agricultural productivity whilst guaranteeing the incomes of farmers, stabilising markets and assuring the food supply. Although one of its stated aims has always been to ensure reasonable prices for the consumer, it has consistently raised the price of food above that which prevails on the world market.

Article 39 of the Treaty of Rome promises a policy which offers farmers a reasonable standard of living on the basis of stable market conditions and, for consumers, affordable prices and security of supply. Article 40 then offers a choice of ways in which these goals might be achieved. There was to be, however, in every case, a common Community organisation of markets. Only the means to achieve this differed.

What makes agriculture a special phenomenon within the EU is Article 42, which states that specifi c provisions of the CAP take precedence over normal competition rules.1 It seems that free markets, whose wonders are reckoned limitless when it comes to the distribution of the baubles of twenty-fi rst century consumerism, are not to be trusted with the prosaic business of fi lling our bellies or, indeed, farmers’ pockets. Although modifi cation of this original blanket exemption began almost immediately, in many striking ways the CAP continues to remove agriculture from the hurly-burly of

132


The CAP and the CFP 133

increasingly liberalised capitalism, though state aids are subject to the same rules as apply in other sectors.

How then, does the CAP work? Firstly, on the basis of Common Market Organisations (CMOs), which remove obstacles to trade in primary agricultural products between member states, a number of aims are pursued: farmers’ incomes are enhanced by pricing regimes which maintain prices at an artifi cially high level, one which is above world prices. In addition to the principle of an internal, barrier-free market, the CAP is based on Community Preference, the use, in other words, of protectionist devices to prevent imported products from being sold at lower prices than are their EU-grown equivalents, a policy which has become increasingly controversial as the ‘free trade’ ethos has driven all other notions of how international commerce might be managed into the margins of political and economic thought. Bucking this trend, the EU fi xes a threshold price, a minimum under which products may not be imported. Finally, the CAP is supposed to perform a redistributive function: the European Agricultural Guidance and Guarantee Fund (EAGGF) is designed to redress any economic disruption brought about by decisions taken under the CAP. Although 2003 saw the most thorough reform of the CAP for over a decade, like that of 1992, which succeeded in signifi cantly reducing surpluses, it left these basic principles intact.

Prices of agricultural commodities are set each year by the Council. In fi xing these prices, the Council takes account of overall infl ation, as well as market conditions such as good and poor harvests or unusual rises or falls in demand. This price is, however, merely a target, and market conditions may put it under pressure. If the actual price farmers are receiving falls too far below the guide price, to a level known as the intervention price (or basic price in the case of meat from pigs), then an intervention organisation in each member state is legally obliged to buy and store the product in question. Where food which is too perishable to be stored is concerned (mainly fruit and vegetables), the relevant level is known as the withdrawal price. In such cases surplus produce is, where possible, distilled into industrial alcohol, given to voluntary sector groups who organise its distribution to those in need, or, if all else fails, destroyed, though this is no longer commonplace.

Destruction is avoided by exporting surplus produce. Export subsidies are paid to make this worthwhile, but the damaging consequences, particularly for farmers in poor countries driven off



the land by the availability of low-priced imports, as well as the general distortion of competition such subsidies bring about, has led to the EU’s agreeing to restrict this system to a specifi ed list of commodities and to a smaller overall volume. Bilaterally agreed tariff reductions under what is known as the Generalised System of Preferences (GSP), and EU obligations negotiated under the Lomé Convention, in the framework of the United Nations Conference on Trade and Development (UNCTAD), and with the applicant countries of central and eastern Europe and the Mediterranean, have also greatly reduced the scope of export subsidies. It was the EU’s desire to win negotiating credits in the round of World Trade Organisation talks which began at Doha in 2003 which did most to build up the head of steam which led to that year’s reforms.

Criticism of the CAP has long been severe, and it has focussed on more than one aspect of the system. Firstly, there is the sheer expense. Although in proportional terms spending has declined since the early 1990s, this disguises an absolute increase of around 50 per cent over the decade. Even the supposedly cost-cutting agreement reached at the Berlin Summit of March 1999 accepted a rise in spending for the period 2000–06, cutting expenditure only against a notional might-have-been. Overall, the CAP accounts for just under half of the EU’s annual expenditure.

If this resulted in lower food prices it might constitute an effective redistributive mechanism, as the poorer an individual or family, the greater proportion of net income is spent on food. Unfortunately, however, precisely the opposite is the case, as the CAP infl icts a double burden of artifi cially high prices, coupled with taxation, to maintain prices paid to farmers at around double the level found on the world market.

Criticism has also come from trading partners who object to the exclusion of agriculture from what are now, under the WTO, the normal rules of world trade, where subsidies and artificial encouragement to domestic industries are severely restricted. Finally, even the supposed benefi ciary of all this, the farmer, is suffering. Despite being virtually forced by the rules of the CAP to employ the most environmentally destructive methods, farmers in most member states have for a long time seen their incomes decline.2 The smaller the farm, the more likely this is to be the case, with the result that the devastation of nature is compounded by the wholesale destruction of rural communities.



As well as failing to give them effective support, moreover, the CAP traps farmers into a bewildering maze of bureaucracy. Not only does this waste time which might be better employed farming, the CAP’s bizarre procedures offer huge opportunities for fraud, which has been estimated to have cost an infl ation-adjusted €3 billion since 1970.3 Since the late 1980s, attempts have been made at reforms which would fulfi l the EU’s obligations under the GATT (now the WTO) to reduce and eventually eliminate subsidies, whilst avoiding building up food mountains and preserving the countryside, its population and environment. These attempts have, however, foundered on the rocks of farming interests. The latest, urgently necessitated by the prospect of enlargement, have made some headway, but have once again come up against the immutable fact that the interests of different groups of farmers, and therefore of different member states, are in irreconcilable confl ict.

Agenda 2000, a fi nancial framework for the Union from the year 2000 submitted by the Commission in July 1997 (COM(97) 2000),4 made budget stabilisation a priority for the CAP and stressed the need to bring about a closer alignment with world prices and to couple this with direct income support. In this context it for the fi rst time allowed member states to introduce what it termed. ‘optional modulation’, relating income support more to need and enhancing the CAP’s role in rural development.

In 2002 the Mid-Term Review (MTR) of the common agricultural policy, a statutorily required analysis of developments, reiterated the goals set out at the 1999 Berlin Summit. ‘Intervention’ should become no more than a safety net, with farmers being forced to take more account of market conditions; subsidies would be shifted from product support to direct producer support, based on a system of aid granted independently of production; ‘cross-compliance’ would reward sustainable methods and environmental standards would be mandatory, while more environmentally-friendly production methods would be supported in a variety of ways; and provision would be made to ensure the smooth incorporation of the agriculture of the new member states. Priorities would be the protection of the environment, animal health and welfare, food safety and quality, and sustainable rural development.

When the CAP was reformed in June 2003, it was clear that farm ministers had at least read the MTR and that, under pressure from enlargement and the coming WTO talks, the notorious policy was



at last to receive a major overhaul. It was also evident, however, that vested interests remained a massive brake on the process of developing an agricultural policy suitable to the conditions of twenty-fi rst-century Europe rather than the EEC of the 1950s.

The biggest reform is the introduction of the ‘single farm payment’, calculated on the basis of the amount of direct aid received during a reference period (2000 to 2002). The payment will be ‘decoupled’, in other words, it will no longer be related to production levels. However, a number of exceptions were allowed in the fi nal deal, with some member states fearing that the new system would lead to a complete abandonment of production in certain areas and sectors. The payment will be conditional upon cross-compliance with environmental, public-health and animal-welfare standards. Aid to big farms will be reduced and the money saved spent on an enhanced rural development policy.5

Accompanied by changes in intervention prices, reform of the market system for a number of commodities, and a number of special measures such as support for biofuels, the reform was more thoroughgoing than any since that of 1992 which, though disappointing at the time, had succeeded in making major inroads into overproduction. Nevertheless, it was criticised from many sides as not going nearly far enough. Friends of the Earth complained that CAP subsidies were paid out in the new central and eastern European member states with no regard to the environmental consequences;6 developing countries continued to complain that EU farm subsidies were destroying their own agricultural producers; no one was convinced that the EU had fulfi lled its ambition of reforming the CAP suffi ciently to give itself a strong negotiating position in the coming round of WTO negotiations;7 while Britain’s right-wing rural pressure group, the Countryside Alliance, complained of the unevenness which would result from merely empowering member states to pursue reforms, rather than obliging them all to follow the same agenda.8

THE COMMON FISHERIES POLICY

European fi sheries are, like those in most of the rest of the world, in crisis. All the signs indicate that, unless drastic action is taken, humanity is in danger of exhausting what has been one of its major sources of food for possibly tens of thousands of years. The equation



does not work out. Too much of the fi sh stock has been pulled from the ocean for purposes which are wasteful and following policies which are short-sighted in the extreme. The Common Fisheries Policy has manifestly failed to tackle this problem. It has allowed factory ships to plunder waters traditionally fi shed by relatively sustainable methods, waters upon which whole communities depended for their livelihoods. It has produced unfair catch divisions between national fl eets, causing persistent antagonisms between member states. It has failed to protect either the fi sh, the men and women who make their livings from them, or the consumer. Of all the EU’s policies, it is the most spectacular and persistent failure.

The crisis of the EU’s fi sheries forced the Union and its member states to face up to the need for radical reform. However, as with the CAP, vested interests and political decision-makers who could not see beyond the next election stood in the way of the kind of drastic action which was needed.

Reform came in December, 2002 in the form of three Regulations which came into immediate effect, entering into force on 1 January 2003. Their aim was to attempt to ensure the industry’s survival in the face of the massive diminution of its natural resource. Attempts were made to preserve livelihoods, conserve the essentially fragile marine ecosystems on which they depended and thus maintain the supply of fi sh to consumers. A more long-term approach was promised, in which fi sheries management would be based on multiannual management and stock recovery plans designed to replenish fi sh stocks. In the event of a serious threat to the conservation of resources, emergency measures may be taken by the Commission for a period of six months, renewable for a further six months. If a member state disagrees with the measures, it may refer the matter to the Council.

In the long term, aid will be used only for the improvement of working conditions, product quality or fi shing techniques, or to equip vessels with satellite vessel monitoring systems. In a transitional period, however, aid will continue to be authorised for the support of fi shermen and vessel owners forced temporarily to stop fi shing, for early retirement and for retraining, and for the withdrawal of vessels, premiums for which will be increased. A maximum fl eet capacity level has been set for each member state which will be reduced as boats are decommissioned. As well as subsidies for building new boats, aid for the permanent transfer of EU vessels to third countries will be abolished. Savings from these cuts will be spent on retraining and



compensation for loss of income resulting from fi shing restrictions imposed under recovery plans.

Conditions for the payment of subsidies for modernising boats have become much stricter, while from 2005 aid for building new fi shing boats ceased, putting an end to a major anomaly. Attempts are being made to improve enforcement by the establishment of a new ‘Community control and enforcement system’ involving both EU and national inspectors organised in a Joint Inspection Structure and a Community Fisheries Control Agency (CFCA).

Conservation is now based on what is termed an ‘ecosystem-based approach to fi sheries management’ incorporating the precautionary principle.

Regional Advisory Councils (RACs) have been established whose membership consists of fi shermen, scientifi c experts, representatives of other sectors related to fi sheries and aquaculture, as well as local, regional and national authorities, and environmental groups and consumers from the maritime or fi shing zone in question. The RACs, which will not be organised on national lines but on the basis of ‘sea areas’ under the jurisdiction of two or more member states, will have no executive or decision-making powers but only the right to be consulted and to make suggestions. Finally, a number of Community Action Plans, most importantly a plan to integrate environmental protection requirements into the CFP, complement the new policy.

The new CFP does appear to represent a major improvement. Though the goal of allowing sustainable fi shing is an ambitious one after decades of irresponsible plundering of the sea’s resources, it is at least slightly reassuring to see that the approach of total meltdown is capable of focusing the minds of one group of ministers.

The new policy is, however, scarcely free of its own fl aws and weaknesses, based as it inevitably is on a compromise between countries with, as in the case of the CAP, essentially irreconcilable interests. Whether these will undermine the reformed policy’s positive aspects it is too early to say, as the new measures are being phased in between 2004 and 2006, so that it will be some time before their full impact is felt. The conservationist group World Wide Fund for Nature (WWF) estimates that a 40 per cent reduction in the size of the EU fl eet over the next fi ve years is necessary, and the belief that such a cut is possible seems optimistic. Recovery plans will determine cuts in capacity, and these will need to be agreed by the Fisheries Council, leaving the question wholly in the political realm, a place of inherent uncertainty.9



Box 13.1

The Common Agricultural Policy Following the Reform of 2003

• Single farm payment: new system based on a single farm payment for EU farmers, independent of production, though exceptions may be maintained to avoid abandonment of production.

• Cross-compliance: payment linked to respect of environmental, food safety, animal and plant health and animal welfare standards, and requirement to keep all farmland in good agricultural and environmental condition.

• Rural development: strengthened rural development policy including new measures to promote the environment, quality of production, and animal welfare.

• Modulation: reduction in direct payments for bigger farms, savings to be used to fi nance enhanced rural development policy.

• Financial discipline: a mechanism to ensure that the farm budget (fi xed until 2013) is not overspent.

• Revisions to the market policy of the CAP, including cuts in price of dairy products and cereals and reforms in other sectors.

Box 13.2

The Common Fisheries Policy Following the Reform of 2003

• ‘Scrapping Fund’: emergency fund to encourage the decommissioning of vessels.

• New set of objectives focus more on sustainable exploitation of resources and the precautionary principle.

• A more long-term approach to fisheries management based on multiannual recovery plans for stocks outside safe biological limits and of multiannual management plans for other stocks, including catch targets.

• Provision for emergency measures by the Commission applicable for a period of six months and renewable for a further 6 months and by Member States for their own waters for three months.

• Member states will be allowed to adopt non-discriminatory conservation and management measures applicable to all fi shing vessels within their twelve-mile zones.

• A simpler system for limiting the fi shing capacity of the EU fl eet in order to reach a better match with available resources. Aid for building of new



vessels and permanent transfer of EU vessels to third countries abolished and new restrictions placed on aid for modernisation.

• Aid from member states to fishermen and vessel owners who have to suspend fi shing due to unforeseeable circumstances may now be allocated for three consecutive months or for six months over the entire period between 2000 and 2006.

• Retraining aid extended, including to those wishing and able to continue fi shing on a part-time basis.

• Existing rules on access to national waters have been largely maintained, as has the principle of relative stability, based on a defi ned share of the stocks for each member state.

• Control measures will be strengthened.• Co-operation among member states will be reinforced.• Sanctions will be harmonised.• The Commission is authorised to take immediate preventive measures,

applicable for a period of three weeks and prolonged up to a maximum of six months, if there is evidence that fi shing activities could lead to a serious threat for the conservation of resources.

• Member states which exceed their fi shing opportunities will be penalised by the deduction of quotas.

• The Commission will be empowered to carry out inspections on vessels, premises of businesses and other bodies with activities relating to the CFP, but only with the inspected party’s permission.

• Regional Advisory Councils (RACs) will be made up by fi shermen, scientists, consumers and representatives of other relevant interests. Each RAC will cover sea areas under the jurisdiction of at least two member states.


14Transport

It has always been the intention of the European Community to develop a Common Transport Policy (CTP) and, on paper, the CTP came into being with the Treaty of Rome. The initial problem was to cure the member states of the border habit, making it as easy to travel and shift goods between them as it was within the frontiers of a single state. Until the mid-1980s, however, these attempts proved a miserable failure, making something of a mockery of the idea that the Community indeed had a unifi ed transport policy, or even that it was a genuine ‘Common Market’ at all. A second aim of the CTP, the right of carriers from one member state to offer services in another, seemed even further from realisation.

One of the major priorities of the drive to create a single EU internal market was to overcome the continuing national control of transport systems, enforce liberalisation and bring about, on this basis, a more unifi ed system. Much of this has been achieved, which may be why transport has become cheaper whilst steadily decreasing in reliability and contributing an ever-greater share to major problems of air pollution, climate change, noise and a host of other forms of social damage. In road transport, at least, national markets have largely been opened, and carriers from one member state are free to offer services in another, even – and this was for many years the great sticking point – where both the place of departure and the destination were in the same country.

In addition to problems specifi c to transport, the attempt to revive the CTP faced all the usual diffi culties of the single market project: incompatible national standards regarding technical specifi cations; rules governing workforce conditions, safety and the environment which differed greatly in stringency; diffi culties (particularly acute in the case of transport, which was characterised by a high proportion of public ownership) in enforcing rules on state aids and other aspects of competition policy and the fact that not everyone was (or is) convinced that liberalisation was a good thing. Efforts have been more successful in some sectors than others, and in transport there remains a great deal to be done before we arrive at the free market EUtopia dreamed of by the Union’s ideologues.

141



2001 WHITE PAPER ON TRANSPORT

The European Commission made another attempt to tackle these problems in its White Paper on the future Common Transport Policy, presented in September 2001. The White Paper proposed 60 measures ostensibly designed to reduce the environmental, human and fi nancial costs of congestion, pollution and accidents whilst furthering the internal market and economic development in general, all in the face of a predicted rise in freight transport of 38 per cent and passenger transport by 24 per cent by 2010. This would be addressed by attempting to shift freight and passengers from road to rail and by increasing the use of water-borne forms of transport. This could in part be achieved by ‘internalising external costs’, or making each transport mode refl ect its true costs by adjusting taxation accordingly. In addition, technical and organisational means, as well as changes in laws and their enforcement, could be used to make all transport systems both more effi cient and safer.

The problem which the European Commission attempted to face in its 2001 White Paper was that, having described the huge fall in the cost of transport since 1970 and consequent massive across-the-board increases in demand as a ‘success’, it was faced with having to perform the contradictory task of having to curb this demand. In the White Paper’s ‘Policy Guidelines’ it stated that ‘A complex equation has to be solved in order to curb the demand for transport’, an ‘equation’ which arose from the fact that economic growth leads almost automatically to increased mobility, that enlargement will exacerbate this increase, and that the resulting ‘saturation of the major arteries’ will require ‘major investment’.1 To its credit, the European Commission does not conclude from this that we need lots of new motorways, though travelling around Europe one’s impression that the Old Continent is being rapidly covered in concrete and asphalt does make this somewhat surprising.2 On the contrary, the Commission’s White Paper is based on the perceived need to break the link between economic growth and transport growth.

Excusing itself from even considering more drastic solutions on the reasonable grounds that subsidiarity considerations mean that it lacks the power to carry these out, the Commission recommends ‘a series of measures ranging from pricing to revitalising alternative modes of transport to road and targeted investment in the trans-European network’. The initial aim would be to ‘allow the market shares of the other modes to return to their 1998 levels and thus


Transport 143

make for a shift of balance from 2010 onwards’. The Commission also recognises that this will be diffi cult, and that it will not be achieved by concentrating exclusively on transport policy measures per se. Instead, transport must be integrated into ‘sustainable development’, mainstreaming environmental objectives into transport policy. The Gothenbourg Council of 1999 pointed to shifting the balance from road to rail and water as the key to this, but it would also, as the Commission acknowledges, require reducing the use of fossil fuels through the development of alternatives and increasing effi ciency. Both of these could be aided by the encouragement of ‘intermodality’, the integration of transport systems so that any given passenger or freight journey can proceed smoothly from, say, train to water or water to rail, allowing the most effi cient choice to be made.3

All of this sounds very impressive, at least until you begin to look at how it is supposed to be achieved. The answer, as ever, is that it is presumed that the market, liberalisation and deregulation will deliver. Take away ‘distortions’, and all will be well. The internal market for goods transport by road which accounts for almost half of freight transport, has been fully liberalised since the late 1990s, while passenger transport by bus and coach is in the process of deregulation. Regulation to protect the safety of road users is seen as necessary, but all that is required for a shift from less to more sustainable forms of transport to occur, or so the Commission would have us believe, is what amounts to a raft of internal market measures, partly designed, it is true, to internalise external costs, but in the main to allow private investors to make profi ts.

The three ‘Railway packages’ adopted by the Commission in 1999, 2001 and 2004 respectively, are designed above all to prepare national systems for both deregulation and interoperability, as if the two were intimately linked. Member states must gradually open their rail freight markets to competition and, while public ownership is not openly discouraged, its advantages are largely annulled by the imposition of a liberalised market. In the light of this drive for deregulation, accompanying measures aimed at improving safety, accessibility for disabled people, and the use of environmentally friendly vehicles, whilst welcome, are no more than necessary measures to prevent the sort of embarrassing shambles to which British transport users have grown accustomed since the Thatcher government’s retreat from public ownership 20 years ago.4

Other modes of transport do not carry the same legacy of national organisation of publicly owned systems. The internal aviation market,



for example, has been fully liberalised since the mid-1990s and in general state aids are forbidden or severely restricted, though the rules were effectively relaxed in response to the crisis suffered by the industry after 9/11. EU action is therefore generally limited to ensuring ‘fairness’ in the competitive market through, for example, common rules on the the allocation of slots at Community airports, a measure designed to prevent member states favouring national carriers or discriminating for other reasons between different airlines. A bloc of liberalising, harmonising measures known as the ‘Single European Sky (SES) package’ has been accompanied by initiatives to improve passenger safety, including the establishment of the European Aviation Safety Agency (EASA), as well as some improvements in the consumer rights of, for example, people denied boarding due to overbooking.5

Sea transport, though generally in private hands, exhibits a number of features which offend the liberalising zeal of the European Commission. Member states themselves remain generally unconvinced that the kind of doctrinaire drive to deregulation which has transformed the European economy since the end of the 1980s provides an appropriate model for an industry in which safety must be paramount. Early in 2001 the Commission introduced a proposal for a Directive on market access to port services, opening up different service sectors for competition. After two years and a number of amendments the measure fi nally won the approval of the Council of Ministers and the European Parliament. However, the Parliament’s approval was conditional on further amendment, so that the two institutions had to go into formal Conciliation. Whilst these parliamentary and bureaucratic procedures were taking place, however, mass demonstrations of angry dockworkers and their supporters were being held in Brussels, Strasbourg and Rotterdam, and many MEPs on all sides of the house were hesitating. When the crucial vote came, it was known that the Socialist Group, the United Left Group and the Greens would oppose the deal and that this might be enough to defeat it. Only an extraordinary volte-face by the Socialist Chair of the Parliament’s team of MEPs allowed the measure to carry. This was not the end of it, however, for when it came before the full parliament it was voted down and the Commission was forced to go back to the drawing board. The concerted action, involving powerful trade unions and well-organised sympathetic MEPs, had succeeded in forestalling a measure which would have allowed unqualifi ed personnel to carry out tasks which require proper


Transport 145

training. The Port Services Directive would have cost thousands of jobs and more than one worker’s life, and for once the Commission had to wake up to the fact that there was a world outside the elite circles in which it prefers to do business.

Aside from the attempt to deregulate port services, and the Marco Polo programme outlined below, the EU has fully liberalised its ailing shipping sector, which has nevertheless continued to lose out to fl ags of convenience. In response, and more specifi cally as a reaction to a number of disasters involving oil tankers – most spectacularly the scandalous Prestige affair of 2002 – the Commission has declared its determination to enforce compliance with existing law from all ships in European waters, as well, more specifi cally, as speeding up the phasing out of single-hull tankers.6

The inland waterway market was totally deregulated in 2000, but has not been seen as requiring further EU legislation specifi c to the sector.7

TRANS-EUROPEAN TRANSPORT NETWORKS (TENS)

The Maastricht Treaty established Trans-European Networks in transport, energy and telecommunications. They were designed to address the fact that the development of the internal market had been, or so it was argued, hampered by the fact that transport systems, as well as energy and telecommunications infrastructures, were designed to serve separate countries rather than to facilitate travel between them.

TENs are fi nanced by a mix of EU, member state and private fi nance and will cost an estimated €400 billion by 2010. As far as transport (known as ‘TEN-T’) goes, the Commission’s proposals, approved by the Parliament and Council in 1996, were for 70,000 km of railways, including 22,000 km of new and upgraded track for High Speed Trains, 15,000 km of new roads, combined transport corridors and terminals, 267 airports, and networks of inland waterways and sea ports.

The Commission claims that TENs will help fuel growth and that this will bring jobs, benefi ting everyone; that peripheral regions will benefi t from improved links; that applicant countries’ integration will be facilitated and other neighbours will benefi t from improved links with the wealthy EU; it even states they will reduce traffi c congestion and therefore pollution. TENs, says the Commission, ‘embody the concept of sustainable mobility which seeks to improve



the environment and preserve tomorrow’s natural resources without sacrifi cing today’s economic growth’.

Not everyone is convinced, however. Critics argue that TENs are too expensive, that too much is being spent on roads, that most of the investment in rail is in High Speed Trains which hold few benefi ts for ordinary people and are less environmentally advantageous than would be a major investment in short- and medium-distance conventional rail. In addition, little has been done to produce reasoned proof of the economic benefi ts of TENs. At this stage of research, the claim that TENs will enhance regional economies is no more plausible than the counter-claim that they will lead to more centralisation of production in already prosperous areas.

These criticisms were amplifi ed when imminent enlargement led to the extension of TENs to the new member states. Environmental safeguards were cursory and a far greater proportion of the available funds was invested in roads than would seem justifi ed in countries which had inherited strong if outmoded rail networks from their days as planned economies. The Commission responded to these criticisms by publishing, in 2003, a list of priority projects, some of which involved these countries, which did indeed lean far more heavily towards rail and water transport, but which were nevertheless criticised, including by the European Parliament, for in most cases failing to prioritise environmental considerations.8

MARCO POLO AND GALILEO

Finally, the Commission adopted the first of these Renaissance gentlemen’s name as the label for a programme, proposed in 2002, the objective of which was to shift 60 billion tonne-kilometres9 of road cargo to short sea shipping and railways. Large-scale pilot projects were intended to promote intermodal international freight services. The programme, with a budget of €100 million, began life in 2003 and is intended to run until the end of 2006, though the Commission has now presented a proposal for a ‘Marco Polo II’ which would run up to 2010.10

The Galileo satellite radio navigation system is intended to provide information on the positioning of users in, amongst others, the transport sector. Criticised by cost-conscious MEPs for unnecessarily reproducing the US’s Global Positioning System (GPS), it nevertheless won approval and is currently in the development stage.11


Transport 147

Box 14.1

The problems

In the European Union:

• Transport services are provided to a total value of over €500 billion a year. The transport sector thus accounts for 4 per cent of the European Union’s GDP.

• During the 1980s and 1990s, the transport sector grew 2.3 per cent a year for freight and 3.1 per cent for passengers.

• Six million people, or 4.2 per cent of the total working population, are employed in transport. This number increases to 14 million if we add those employed in the transport equipment industry and all those working in transport-related businesses.

• €70 billion is invested each year in transport infrastructure, equivalent to 1 per cent of the EU’s GDP.

• Household spending each year on transport totals €600 billion. On average this is 14 per cent of each household’s annual income.

• EU residents travel an average of 35 km each day.• Road freight transport more than doubled between 1970 and 1995.• Every year, 42,000 people die on the roads. • The creation of a huge single market increased demand for transport in

Europe, and boosted cross-border movements in particular. Between 1980 and 1994, total traffi c within the EU increased at a rate of 2 per cent a year, and cross-border traffi c by 2.4 per cent. Demand for freight transport is forecast to double within 20 years.

• The volume of freight moved by road increased by about 3.5 per cent a year between 1980 and 1996, and 6 per cent of this went across borders. Air passenger traffi c grew by 7.8 per cent between 1980 and 1990 and 6.1 per cent between 1990 and 1996.

• Freight movements by rail have steadily declined: down 1.1 per cent between 1980 and 1990 and down 2.6 per cent between 1990 and 1996, whilst carriage by inland waterway (up by 0.1 per cent between 1980 and 1990 and by 0.3 per cent between 1990 and 1996) and traffi c through the Union’s principal sea ports (up by just 0.5 to 1 per cent a year from 1980 to 1996) have remained virtually stagnant. Moreover, little attempt has been made to ensure complementarity between different systems.

• The result of this imbalance is visible in traffi c jams, congested airspace, pollution and accidents, the conversion of station buildings, closure of railway routes, decline of river traffi c, and so on.



• In 1999 a car, equipped with the very latest in engine technology progresses about as fast as a coach and horses did a hundred years ago. The cost to the EU’s member states has been estimated at over €100 billion a year and rising.

If nothing is done at EU level to reverse the trend, transport will be responsible for 40 per cent of CO2 emissions in the EU by the year 2010 (compared with 26 per cent in 1999), seriously undermining the strategy against global warming launched worldwide after the 1997 Kyoto summit.


15Regional Policy

Though it always had its pockets of poverty, only with the admission of Ireland did the EC accept its fi rst member state that could not be classed as industrialised, developed, and relatively well off. Since then, the growth to 15 members included the admission of three more relatively poor countries – Spain, Portugal and Greece – while the 2004 enlargement transformed the EU into a Union of 25 countries on all sorts of income levels. The possible admissions in the near future of Romania and Bulgaria, and even, beyond that of Turkey, the states which once made up Yugoslavia and some of those which formed the Soviet Union, will complete this extraordinary transformation.

Looked at nation-by-nation, the Union of 15 did appear to have experienced a certain convergence between rich and poor, with the average income in the four poorest member states rising from two-thirds to three-quarters of the EU average in the eleven years up to 1996. The best performer of all was Ireland, where per capita GDP increased from 64 per cent of the Community average to almost 90 per cent between 1983 and 1995. A regional analysis over the 1986–96 period gives a quite different picture, however, with income in the poorest 25 regions rising by very little – from 53 per cent of the EU average to 55 per cent. Income disparities everywhere, in rich and poor regions and member states, have widened, with poverty and social exclusion rocketing and its social effects becoming ever more visible, especially in the streets of Europe’s cities.1

It was in response to fears of just such developments that the Single European Act gave the European Union’s institutions the legal competence to create a regional policy. The unfortunate fact that the drive to complete the single market might increase regional disparities had long been quietly accepted, and it was felt necessary to establish a mechanism allowing for the transfer of relatively large amounts of money between different regions of the Community. This was controversial, as it would increase the degree to which taxpayers in the rich member states were asked to subsidise people in poorer areas. The removal of remaining barriers to the movement of goods, services and capital, however – and in particular the last of these

149



– could, it was feared, lead to greater concentrations of wealth in areas already well-favoured for such things as transport and fi nancial infrastructure. In addition, the restructuring of European industry which would result from the completion of the single EC market, though its precise form might be hard to predict, would inevitably mean that some regional economies would see their traditional industries disrupted and would need to be helped through a period of transition in which they sought new means of earning their living. Finally, the single market would require certain countries, in most cases the poorer ones, to invest in expensive improvements to meet such demands as higher environmental standards.

With Maastricht, and the further deepening of integration in the form of Economic and Monetary Union, a new instrument, the Cohesion Fund, was added to the existing Structural Funds: the European Regional Development Fund, European Social Fund, European Agriculture Guarantee and Guidance Fund and European Instrument for Fisheries Guidance. The Cohesion Fund was designed to assist only the very poorest regions and was available only to the ‘poor four’: Greece, Portugal, Spain and Ireland.

A further reform followed: the plan for the period 1994–99 aimed to give the Structural Funds more coherence, to increase their effectiveness as a means of combating unemployment and regional disparities of wealth. The revamped and greatly enlarged funds would also pay greater attention to environmental questions, or so we were promised, and to gender equality. By 1999, structural fund spending amounted to 36 per cent of the total EU budget, the second greatest share after the CAP.2

Generally speaking, the Structural Funds do not supply 100 per cent of the cash needed to fi nance a project. Payments are made according to what is loosely called ‘matching’: a member state government or other public or private institution invests in a project and the money is matched by a payment from the Structural Funds. The division of fi nancial responsibility depends upon the particular Fund and the criteria under which the money has been allocated. The ‘single programming document’, whereby member states would produce a unifi ed and coherent plan for the funds, to then be approved by the Commission and Council, was introduced in 1994 as part of a package of reforms designed to make the funds more effective and ‘additionality’ respected.

Put simply, ‘additionality’ means that member states must use any Structural Fund money to fi nance projects which would not otherwise


Regional Policy 151

have gone ahead. Although the Funds are (with the exception of small schemes known as the Community Instruments) to some extent under the control of the Commission and Council, it is the member states who decide who actually gets the cash. This leaves the danger that they will simply use the Funds to pay for things which they would otherwise have fi nanced from the general budget. The British Tory government did this more or less openly, believing, as they did, that there was no greater virtue than low state spending. The Tories also rightly estimated that the British people in any case were of the opinion, and with no little justifi cation, that the country paid out far too much to Brussels and got far too little back. As well as the additionality problem, loose monitoring has led to a chronic problem of fraud and waste.3

AGENDA 2000

Further reform took place at the beginning of 2000 on the basis of an agreement which began life as part of the Commission’s all-embracing planning document Agenda 2000. The agreement aimed to enhance the effectiveness of the Structural Funds by further concentrating spending. The budget for seven years was a total of €213 billion, including €18 billion earmarked for the Cohesion Fund, to which the new member states would have access. As well as improving the effectiveness of operations in the existing member states, the reform was designed to enable the Structural Funds to be extended to newly admitted countries.

A major aspect of the reform was the reduction in the number of Objectives – the criteria determining how money is spent – from seven to three, as follows:

• Objective 1 promotes the development and structural adjustment of regions whose average per capita GDP is below 75 per cent of the European Union average; remote regions (the French overseas départements, the Azores, Madeira and the Canary Islands); regions eligible under old Objective 6, which gave aid to very sparsely populated regions and was part of the deal when Austria, Finland and Sweden became members. Two-thirds of available money goes to Objective 1.

• Objective 2 contributes to the economic and social conversion of regions in structural difficulties which are nevertheless



ineligible under Objective 1: former industrial and declining rural and fi shing areas. This also covers not far off a fi fth of the total population, but slightly fewer than does Objective 1.

• Objective 3 gathers together all the measures for human resource development outside the regions eligible for Objective 1.4

THE EUROPEAN REGIONAL DEVELOPMENT FUND (ERDF)

The ERDF now provides assistance under the new Objectives 1 and 2, including the Community Instruments (see below). Within the areas eligible under these Objectives, the ERDF contributes towards fi nancing the following measures:

• investment to create and safeguard sustainable jobs;• investment in infrastructure (including TENs) which contributes,

in regions covered by Objective 1, to development, structural adjustment and creation and maintenance of sustainable jobs, or, in all eligible regions, to diversification, revitalisation, improved access and regeneration of economic sites and industrial areas suffering from decline, depressed urban areas, rural areas and areas dependent on fi sheries. Development of the endogenous potential by measures which support local development and employment initiatives and the activities of small and medium-sized enterprises; such assistance is aimed at services for enterprises, transfer of technology, development of fi nancing instruments, direct aid to investment, provision of local infrastructure, and aid for structures providing neighbourhood services;

• investment in education and health (Objective 1 areas only).

Measures are in all cases expected to take into account the need to develop research and technological facilities including information technology, to protect the environment, and to promote equal opportunities between men and women and trans-national, cross-border and inter-regional co-operation.5

THE COHESION FUND

The Cohesion Fund is intended to contribute to the strengthening of the economic and social cohesion of the European Union. With the adoption by Greece of the euro at the beginning of 2001, the


Regional Policy 153

Cohesion Fund’s initial goal of equipping countries to join the euro-zone was achieved, as only three EU member states, all of them wealthy – Sweden, Denmark and the UK – continued to shun the single currency. However, enlargement once again made this aspect of the Cohesion Fund necessary.

THE COMMUNITY INSTRUMENTS

The Community Instruments (CIs) were set up in 1989 and, unlike the rest of the Structural Fund instruments are under the direct control of the Commission, which, under agreed guidelines, decides who gets how much money. In 1994 the CIs were reformed and guidelines issued which foresaw the operation of 13 initiatives at a cost in all of €13.45 billion. In 1995, a special programme for Northern Ireland, the Peace Initiative, was added.

Following the experience of this six year period, the decision was taken to concentrate the funds into four larger CIs. The budget was reduced to €10.44 billion, representing 5.35 per cent of the total allocation for the Structural Funds (2000–06). Despite this reduction, concentration of course meant that each of the remaining funds was much larger than its predecessors, and, as the Employment CI had been, divided into different sections. The four funds now in operation are:

• Inter-reg III: cross-border, transnational, and inter-regional co-operation;

• Urban: regeneration of urban areas in crisis;• Leader +: rural development;• Equal: transnational co-operation to combat discrimination

and inequalities in access to work.

The total appropriation for the Structural Funds, including transitional assistance to the new member states, the Community Instruments and innovative actions amounted in 2005 to €195 billion, with 0.7 per cent going to Objective 1, 11.5 per cent to Objective 2, 12.3 per cent to Objective 3 and 6.0 per cent to the Community Instruments. The rest forms part of the aid to fi shing communities, which, like agricultural areas which receive support from the European Agriculture Guidance and Guarantee Fund, have their own dedicated fund, the Financial Instrument for Fisheries Guidance.6



THE FUTURE OF REGIONAL POLICY

Whether these Structural Funds will be able to cope with the results of enlargement without further reform it is too early to say, though it is at least likely that, as the poorer member states become politically more confi dent, confl icts will not arise. The most thorough guide to the European Commission’s thinking on the future of regional policy is contained in its ‘factsheet’ Cohesion Policy: The 2007 Watershed.7

The main theme of this document is the need to integrate cohesion policy, for which read regional policy, which takes up around a third of the EU budget, with its broad objectives as set out in the Lisbon agenda. Aid should, according to the Commission’s long-held view reiterated in this document, be more targeted on poorer regions, though it should be sufficiently flexible to respond to changes elsewhere. It should be simpler, more effi cient and more transparent, and refl ect the ‘knowledge economy’ strategy of investment in sectors likely to contribute most to the goal of making the EU’s economy the most productive in the world.

The problem with this is the familiar one of being ‘against sin’ – only when the Commission gets down to defi ning sin and virtue and how to go about avoiding one and achieving the other does the potential for controversy arise. Such potential is indeed evident, and as we are dealing with a proposal brought forward in mid-2004 for implementation in 2007, when the current multiannual plan expires, it is diffi cult to assess the Commission’s chances of success.

The proposed reform is ambitious, in that it would scrap the current Objectives and replace them with three new ones: convergence; competitiveness; and employment co-operation. Clearly, moreover, whether or not these proposed reforms are accepted, their success will depend largely on the amount of money available, which will be determined by the adoption of a new set of fi nancial perspectives during either 2005 or 2006, after which the Commission will fi ll in the operational details of whatever has been agreed by the member states, with some input from the European Parliament. This is unlikely to prove a harmonious process, especially given the economic diffi culties through which much of the Union is passing.


16Industrial Policy and Energy

The European Union has no specifi c, systematic industrial policy in the way that it has a policy for, say, agriculture or transport. Instead, what might be termed an ‘EU industrial policy’, is in reality an amalgam of elements of other policies laid out in many different sections of the Treaties: the completion of the internal market (including competition policy), EMU, external trade, social and regional policies, telecommunications, research and development, and energy.

In contrast to the picture which emerged when we looked at the environment or development policy, then, it can be seen that industrial policy is fully ‘mainstreamed’, in a sense by default: the interests being dealt with are simply too powerful to ignore. The likely benefi ciaries of a sound development strategy or victims of one which is poorly designed or deliberately exploitative are men, women and children whose voices have few opportunities to make themselves heard in the world. The ‘green’ NGOs who lobby Brussels for effective laws to tackle urgent environmental problems have together not a hundredth of the resources that a single multinational corporation can bring to bear on blocking the same. Thus, whilst development and the environment are quickly forgotten by Commission personnel not specifi cally responsible for those areas, the needs of industry never are. The EU’s major industrial policy goals run like a recurrent motif through every area of policy, bolstering some measures, undermining others, giving shape and coherence to what at fi rst appears to be a chaotic and incoherent body of legislation, action programmes, communications, recommendations, papers white and green: the EU’s true raison d’être can be found here, in its determination to enforce a competition policy designed to bring about a liberalised market where the sort of interventionist approach suggested by the term ‘industrial policy’ becomes impossible. Instead, industries must be ‘restructured’ and everything subordinated to the principle of ‘competitiveness’, otherwise known as profi t.

Once you have decided that ‘what’s good for business is good for Europe’, an assumption which underlies EU policy-making, everything else falls into place. World trade must be liberalised,

155



because this will give European manufacturers and service providers access to foreign markets and cheaper imports equipment. However, while this requires lip service to be paid to opening up EU markets to foreign competition, this is avoided if it would place a powerful European corporation in jeopardy, while nothing is done to enable developing countries to diversify their economic bases in case this should undermine EU market domination. The single internal market must be completed, whatever the social and environmental cost, because underneath all the rhetoric the central, almost exclusive real purpose of the EU is to create a vast business-friendly area. Transport policies concentrate on the development of the sort of infrastructure on which business insists, so that huge road-building projects, the facilitation of ever-increasing air travel and the development of high speed train networks proceed apace while on the ground urban public transport deteriorates and its rural equivalent disappears. Research is business-led, with only relatively small amounts being spent on projects of direct benefi t to ordinary citizens, though it is of course ensured that it is these which receive the most publicity. Social and employment policies, guided by the so-called Lisbon Strategy, aim to promote competitiveness rather than such old-fashioned values as workers’ rights or the eradication of poverty.

What amounts to the founding document of post-Maastricht industrial policy was the 1993 Commission White Paper Growth, Competitiveness, Employment: The Challenges and Ways Forward into the 21st Century1 which called for more resources to be devoted to research and development and for education and training to be tailored to the needs of industry. It also urged greater effort to realise the plan for Trans-European Networks (TENs) in the areas of transport, telecommunications and energy in order to make a physical reality of the ideological and legal achievement that was then the single internal market. Barriers could be removed, but unless Europe’s infrastructure was more geared to industry’s demands, then the legal right to make goods in Aberdeen and sell them in Athens would have little or no effect on the real world.

In 2002 the Commission Communication Industrial Policy in an Enlarged Europe2 suggested ways in which industrial policy could be reshaped to meet the demands of the Lisbon agenda and of the coming enlargement. Noting the shift from manufacturing to services, which had grown from 52 per cent of the industrial output of the EU15 in 1970 to 71 per cent in 2001, the Commission emphasised the interdependence of the two and the rising demand for highly


Industrial Policy and Energy 157

skilled labour in both. It also laid emphasis, however, on the gap in productivity growth between the EU, in particular its manufacturing industries, and its main competitors in the USA and Japan, and its weak performance as regards technical innovation, which it related to a relatively low level of investment in research and development (1.9 per cent of GDP in 2000 compared to 2.7 per cent in the US and 3 per cent in Japan). These problems would, unless urgent action was taken, be exacerbated by enlargement.

ENERGY POLICY

The European Coal and Steel Community which preceded and laid the ground for the EEC, had security of energy supply as one of its principal concerns. At the same time as the European Economic Community was created by the Treaty of Rome, moreover, so was the European Atomic Energy Community (Euratom). These two facts alone serve to demonstrate the place that energy has always had in the hierarchy of EC/EU concerns.

This makes it somewhat surprising that, after three major revisions of the Treaty in less than fi fteen years, it still contains very little specifically about energy. As with industrial policy, however, this is more a sign of a sort of effortless, almost unconscious ‘mainstreaming’ than it is of indifference. In addition, however, some member states have been extremely reluctant to hand over too much competence and control over energy to the Union. Energy supply in most countries remains to a signifi cant extent in social ownership and often under the direct control of the state. It is not only politically a highly sensitive area, but in economic terms a potentially highly contentious matter: national energy policy has always been used, whatever the actual structure of ownership, as a means of underwriting the competitiveness of a country’s industries. Cheap energy can be achieved by effi ciency, but also by socialising costs: in other words, through government intervention in the form of subsidy or tax measures, resources can be transferred from other areas of the economy in order to lower energy costs for everyone. This is a lot to give up, especially when the ability to manipulate one’s national currency to give a boost to competitiveness has been thrown away. In addition, the objective situation of each member state in relation to energy is enormously varied, depending on possession of carbon fuel reserves, the extent of investment in nuclear energy and the amount of public interest, positive and negative, in one or



another energy source. For different reasons coal, oil, nuclear power and renewable energy sources are all capable of generating not just power but an emotional response amongst the public which, in some cases, translates into organised action.

EU energy policy continues to be recognisably that set out in the Commission’s 1995 White Paper on Energy Policy for the European Union (COM(95) 682).3 Seven years later the Green Paper Towards a European Strategy for the Security of Energy Supply4 followed in 2003 by the Commission Communication Energy Infrastructure and Security of Supply, Commission, Parliament and Council underlined the need, fi rst stressed in that White Paper, to subject energy supply to the same neoliberal market rules as governed other sectors, limiting public intervention to a minimum of support aimed at safeguarding the public interest and welfare, as well as protecting the consumer and the environment.5

EU energy policy continues openly to promote the use of fossil fuels, in particular coal, but also natural gas, as well as nuclear power, spending far more of its budget on these than it does on renewables or on biofuel, though it must be said that this is the fault of the member states rather than the Commission or Parliament, both of which have consistently argued for a greater share of the energy budget to be devoted to these alternatives. Though there is agreement in principle that the proportion of renewable energy sources in total energy consumption should be raised, and a target of 15 per cent of total energy use by 2010 has been established, resistance from member states, each of which has its own vested interest in one or another aspect of the status quo, has greatly hindered any progress towards concrete measures for the realisation of this target.

There is, however, a contradiction running through EU energy policy which tends to undermine whatever good intentions the Commission may have. Liberalisation is, in general, supposed to result in, amongst other things, lower prices. In most sectors this is, in the event of its success, an inarguable good, even if some may believe that it is outbalanced by other, less welcome consequences. In relation to such matters as transport and energy, however, every lowering of prices comes with a huge environmental bill attached. Thus, the liberalisation of electricity and gas, not fully complete until 2005, if they do indeed lower prices, will exacerbate the problems of climate change, atmospheric pollution and waste that overuse of energy brings in its wake, militating against conservation measures.



Criticisms of liberalisation have led to the incorporation of some mitigating features into the relevant measures. National regulatory authorities are supposed to ensure that minimum public service obligations are met, security of supply is guaranteed and pricing fair. Information regarding the source of electricity will have to be available to the public, enabling consumers to, for example, favour renewables or shun carbon fuels or nuclear power, at least in theory. The system will not be fully in place until at least 2006 so, as with so many measures discussed in this book, it is too early to say how successful it will be, either in its own terms or in the wider interests of the planet and its inhabitants.

TECHNOLOGY, RESEARCH AND DEVELOPMENT

Although research and development have been fi nanced at supra-national level in western Europe since the establishment of the European Coal and Steel Community in 1951, it was again the Single European Act which provided explicitly for Community competence. The Treaty empowers and obliges the Community to adopt a multiannual research and development framework programme – in fact, simply putting on a more secure legal footing something which was already reality, as the First Framework Programme for Research and Development had already begun, in 1994. Since Amsterdam, approval of this programme is by Qualifi ed Majority. (A sub-programme for Euratom continues to require unanimous approval.) We are now on our sixth.

The object of these common programmes has been to co-ordinate national policies and research carried out directly in the name of the European Union. In this way duplicated efforts could be avoided, overall effi ciency increased, resources pooled and costs lowered. Certain kinds of research, those with an inherently cross-border element – environment, public health, communications systems and transport telematics, to take a few examples – are seen as particularly appropriate for a multi-national approach. However, according to the relevant Treaty Articles, EU research and development policy’s purpose is to strengthen the scientifi c and technological basis of European industry and to encourage it to become more competitive at international level. The fact that other goals, more directly concerned with the welfare of the citizens who pay the bills, are not mentioned has, however, been skirted with some success by the inclusion in



the Maastricht Treaty of a clause which allows the Union to fi nance research provided it is ‘deemed necessary by virtue of other Chapters of this Treaty’.

By fi nancing and helping to determine the direction of research, the EU hopes to help its member states and the corporations based in them to compete with Japanese and American industries with high research input. Research programmes may be 100 per cent fi nanced, in which case they are carried out by the EU’s own Joint Research Centre (JRC). The JRC is actually a complex of research facilities covering different scientifi c and technological areas and includes a controversial atomic energy research facility in the Netherlands as well as sites in Belgium, Italy, Germany and Spain. The EU also offers part-fi nancing to other research projects which fi t its aims, and sometimes makes grants to enable groups of researchers in different member states to co-ordinate their work.

The 6th Framework Programme (FP6), which runs from 2003 to 2006 established as its basis a new European Research Area (ERA), a structure designed to improve cooperation not only between member states but between different relevant sectors. FP6 will be based on what have been termed ‘networks of excellence’, using new technology to create ‘virtual’ centres of excellence whose purpose will be to coordinate the work of the various actors involved from the public, private and university sectors. In addition, ‘integrated projects’ will pull together the research effort around certain priority scientifi c and technological objectives. The Programme’s ‘thematic’ priorities are listed as:

• Life sciences, genomics and biotechnology for health.• Information society technologies.• Nanotechnologies, knowledge-based multifunctional materials,

new production processes.• Aeronautics and space.• Food safety and risks to health.• Sustainable development, global change and ecosystems

(including research in the area of energy and transport).• Citizens and governance in a knowledge-based society.• Specifi c activities covering a wider fi eld of research (including

horizontal research activities involving small and medium-sized enterprises (SMEs) and specifi c measures in support of international co-operation.



In addition, a substantial part of the budget has been set aside for the purpose of establishing and developing the ERA.

The focus and execution of the Union’s responsibility to promote research and development has been criticised on a number of counts. The European Parliament is consistently unhappy with the relatively small amounts allocated to R&D, a rough estimate being that the nationally-allocated budgets add up to some one hundred times the level of EU spending. Others criticise the orientation of research and the corporate-dominated choice of recipients, arguing for the establishment of funding criteria that put public interest ahead of ‘wealth creation’, and include ethical and safety conditions on funding. These critics, who include numerous scientists working outside of the corporate sector and concerned by the increasing domination of the research agenda internationally by profi t-driven decision-making rather than human need, argue for a redistribution of the research budget away from areas such as genomics and information technologies and towards sustainable agriculture, ecology and energy use in sustainable systems, as well as broadly-defi ned public health objectives which would include prevention, nutrition and serious alternative treatments.


17The Rejection of the Constitutional

Treaty: What Next for the EU?

Following the Nice Treaty’s failure to establish a workable system – one which would allow the European Union to expand in size in an orderly fashion while acquiring a range of new competences and functions – the decision was taken to establish a Convention whose purpose would be to write a new Constitution for ‘Europe’. At the end of the Convention, the proposed text was put to an Intergovernmental Conference (IGC), the Nice Treaty having stipulated that such should be held by 2004.1

Presided over by veteran French Gaullist Valéry Giscard d’Estaing, the completely unrepresentative Convention2 submitted its draft, as required, to a summit of the European Council in Thessalonika in June 2003. The IGC began its work a few weeks later, after the summer break. The idea was that the IGC should be completed in time for the admission of the ten new member states in May 2004, just before new elections for the European Parliament.3

Despite the confusion deliberately generated by a shocked EU elite after the massive defeat of the eventual proposal by the electorates of France and the Netherlands, the real position has always been quite clear. For any amendment to the current Treaty to be agreed, from the most trivial all the way up to a sweeping new constitution, all 25 governments of this newly enlarged Union must endorse any proposed text. Given the complexity of the proposals on the table, this was a tall order. The proposed Constitution necessarily covered many diverse aspects, including institutional reforms, the structure of the new Union, citizens’ rights, the legal system, the rights and procedures in relation to accession and secession, foreign and defence policy, fi scal, fi nancial and economic policies, and Europe’s cultural, philosophical and religious heritage. In order to understand the diffi culties which plagued the proposal from the start, it is necessary to look at each of these issues in turn.

162


What Next for the EU? 163

INSTITUTIONAL REFORM

Currently, two individuals can, in relation to the European Union, claim the title ‘President’: the President of the European Commission, who is chosen by the member states, which must unanimously agree his appointment; and the President or Prime Minister of the member state which happens to occupy the six-month rotating ‘Presidency’. Under the proposed Constitution, the European Council would elect its President by QMV, after which their favoured candidate would have to be approved by the European Parliament. This President would serve a term of two-and-a-half years, renewable once. His or her task would be to chair Council meetings, set its agenda, try to further agreed policies, and be the face of the EU beyond its borders.

The current system is seen as having a number of drawbacks which these proposals are designed to overcome. It is criticised for failing to provide continuity or focus. A President serving for two and a half or fi ve years could provide a central fi gure and give the Union a recognisable face both within and outside its territory. The plan was most popular with the big member states, the smaller countries fearing that, no longer having their shot at the presidency guaranteed by a system of turn-and-turn-about, they would never succeed in having one of their nationals elected. In addition, they feared that the new offi ce would weaken the European Commission, which is seen as a more reliable defender of their interests than would be a QMV-elected President.

In addition to a new President, the Union designed by the Convention would have a ‘foreign minister’. Appointed by the European Council using QMV, and with the agreement of the president of the Commission, the foreign minister’s task would be to conduct the Union’s Common Foreign and Security Policy and, as with the President, represent it when appropriate in international negotiations and at international events. The foreign minister would combine the functions currently fulfi lled by the High Representative (itself a newly-created post still held by the fi rst appointee, Javier Solana) and the Commissioner for external affairs. He or she would be both a member of the Commission and the Chair of the Foreign Affairs Council, breaching the hitherto strict separation of powers between the two bodies.

The foreign minister would be responsible for EU foreign policy which, however, would continue to be subject to national veto. The proposal was criticised for replacing one institutional muddle



(confusion over what the High Representative should do and what the Commissioner should take responsibility for) with another, as the foreign minister’s precise role and place in the EU institutional hierarchy was unclear. Some member states, notably the UK, were also unhappy with the title ‘foreign minister’: as only governments have ministers, the least federalist-minded EU leaders felt that its use pointed towards a superstate. The proposal would, however, end the anomaly of the EU having a foreign policy but no single person with whom, say, the US State Department can discuss it.

Perhaps the biggest institutional shake-up concerned the make-up and functions of the European Commission. Under the proposed Constitution, from 2009 each country would have just one Commissioner, rather than, as now, the bigger member states having two and the smaller only one. It was believed that a Commission of 25 or more individuals, constituted as at present, would be cumbersome and unwieldy, so in this original proposal only 15 of the 25 would have had voting rights, with these being allocated on a rotating basis every fi ve years. Each member state would offer a list of three names – at least one of which would have to be a woman – from which the President would make his or her selection. The Commission would retain its exclusive right of initiative, but citizens would have the right to petition it for the introduction of new laws. The delay until 2009 lent something of an unreal air to these proposals, however, as it was always more than likely that in the interim period the Union of 25, and later possibly 27 states, would encounter new diffi culties to which new solutions would have to be found.

The Constitution would also change the role of the European Parliament, giving it the right of co-decision with the Council of Ministers across a much broader range of policy issues. In addition to those areas currently falling under the co-decision procedure, the Parliament would gain real legislative powers in relation to energy policy, space policy, all areas of environmental policy where co-decision does not already apply, transport, some aspects of social security, and, most controversially, home affairs and justice. In addition, the European Council would have the power to extend QMV by unanimous vote to any area currently subject to the unanimity requirement. On the other hand, the Parliament would see its currently very strong role in determining the budget somewhat weakened.

Within the Council, QMV would become the rule rather than the exception, and the current means of allocating votes would, from



2009, be replaced by the so-called ‘double qualifi ed majority’: for a proposal to be adopted a simple majority of member states would have to be in favour, but this majority must represent at least 60 per cent of the EU’s population.

Every extension of QMV is a step towards a federal superstate, and yet those who favour such a state rarely present their opinion openly. Instead, arguments for more and better QMV are invariably technocratic: any other system would lead to deadlock. The proposed changes were designed to make integration easier, reduce the power of small member states in relation to big ones, and erode the whole concept of a legitimate national interest. This would undermine democracy in two broad ways: fi rstly, it would mean that even more policies could be imposed on particular member states against the express wishes of their people or elected representatives; secondly, the proposal to allow QMV to be extended indefi nitely by heads of state and government hugely erodes the democratic prerogative of ordinary citizens, especially those from countries which require a direct popular mandate for any constitutional change.

Finally, the proposed Constitution would create the entirely new offi ce of European Prosecutor. This sinister-sounding individual would have as his or her task the combating of serious cross-border crime and any illegal activities directly affecting the interests of the Union. This is a sensitive issue, as the member states have traditionally jealously guarded their control over criminal law. Nevertheless, although resistance to the creation of such an offi ce, particularly from the UK, Ireland and the Nordic countries, led to some compromise, the Prosecutor’s powers were so vaguely defi ned that they would in practice be determined by future power struggles and not by the text of the relevant Article.

FOREIGN AND DEFENCE POLICY: THE MILITARISATION OF THE EUROPEAN UNION

The proposed Constitution sought to provide the means to develop a more genuinely common foreign policy designed to lead inexorably to a common defence policy. It would have given the Union competence over both the defi nition and implementation of these policies, and oblige them to support a policy once it is determined.

During the IGC, however, it became clear that these proposals went too far for many member states. Britain, in particular, insisted on retaining a national veto. The proposed Constitution is the result



of an attempt to fi nd a compromise between those who sought a national veto and those who would have been happy with full-blown QMV: majority voting would only be applied to foreign policy if heads of state and government unanimously instructed their ministers to take a vote.

CITIZENSHIP AND CITIZENS’ RIGHTS

The draft Constitution incorporated the Charter of Fundamental Rights agreed at Nice.4

Some governments, notably the British, were sceptical of the need for such a Charter, which does not contain any rights not already enjoyed, at least on paper, by all citizens of the EU’s member states, either through national constitutional guarantees or through their countries’ endorsement of international instruments such as the European Convention on Human Rights (ECHR). However, were these rights to apply in the same ways as other EU laws, citizens would gain the power to pursue them through the European Court of Justice, which, unlike the European Court of Human Rights, has teeth. The draft tried to calm the fears of authoritarian governments such as Britain’s by stating that it did ‘not extend the scope of appli-cation of Union law’, but this merely added to the confusion. Some governments would have preferred to scrap the proposals in the draft Constitution and simply incorporate the Charter into the treaty.

The preamble to the Constitution stated that the EU draws its inspiration from Europe’s ‘cultural, religious and humanist’ inheritance, making reference to the classical tradition, the Enlightenment, the central role of a human individual endowed with inviolable and inalienable rights, and respect for law. Some strongly Catholic countries wanted an explicit reference to Christianity, and Poland even threatened to take an obstructionist line if it did not get its way. However, for all his faults, Giscard d’Estaing is a product of France’s admirable secularist tradition and quite rightly resisted mention of any specifi c religion in favour of broader references to a religious and humanist heritage.

FEDERALISM AND SUBSIDIARITY

The proposed Constitution would deepen the reassurances fi rst heard at Amsterdam, stating categorically that the Union is subordinate to the member states, that it derives its powers from them and can



act only in those areas where the objectives of the intended action cannot be suffi ciently achieved by the member states but can be better achieved at Union level. On the other hand, it would also state for the fi rst time – though this has, in fact, always been the case – that European law takes precedence over national law. To soften this, it would also make explicit the principle of proportionality, and national parliaments would for the fi rst time be given a role in the monitoring of EU legislation. If a third of member state parliaments assert that a proposed measure breaches the principles of subsidiarity and/or proportionality, the Commission would have to reconsider – though, having done so, it could simply present it again!

The proposed text would, however, give, for the fi rst time, ‘legal personality’ to the European Union, meaning that it could sign treaties and other international agreements on behalf of all the member states, and that it could sue and be sued in courts of law. In addition, the fact that the primacy of EU law over national laws is made explicit would mean that if a member state were to enact, or if it has on its statute books, a law which confl icts with an EU law, the national law would become invalid. This is inherent in the logic of the existing Treaties, but making it explicit is nevertheless a clear step towards federalism.

The proposed Constitution also clarifi ed the right of member states to secede, and without explicit conditions, other than a duty to inform the Council and negotiate an agreement setting out the practical arrangements for withdrawal. Although this looks like a nod towards anti-federalism, it is in reality somewhat alarming, as most people would presume that it went without saying that a democratic country taking a democratic decision to leave a democratic family of nations would have the right to do so. And what if the two parties could not agree ‘arrangements’? Could the Council impose conditions? If not, then what are the negotiations designed to achieve? Obviously, leaving the EU would be complicated and negotiations of mutual benefi t, but with such a vague Article governing the process, scope for interpretation and therefore confl ict seems broad.

FISCAL, FINANCIAL AND ECONOMIC POLICY

The absence of any central power to tax is the biggest single factor which prevents the European Union from being, as things stand, a true federal state. It is therefore of great signifi cance that no proposal to grant it such powers emerged from the Convention. Under the



Constitution as proposed, taxes would not only not be directly gathered at EU level, nor could they be fi xed or harmonised under the direction of the Commission or any other European Union institution. Instead, as now, members of the eurozone would be subject to the fi scal discipline that (supposedly) came with adoption of the single currency, with other member states merely accepting a general co-ordination. This would in effect partly institutionalise the status quo, though it would also establish two clear levels of co-ordination, as the euro-zone countries would be able to take measures without consulting other member states. The difference is that whereas co-ordination is taken to mean such things as moving forward in step, following guidelines of best practices, and simply being helpful – things, in other words, which two independent countries could easily agree to do – for those within the euro-zone the ‘guidelines’ become rules, with the ECB controlling monetary policy and the Commission having the power (at least in theory) to punish rule-breakers.

WHY WAS NO AGREEMENT INITIALLY REACHED?

Considerable disagreement over the details of the proposed Constitution was not initially suffi ciently balanced by any strong desire to succeed, and so the heads of state and government arrived in Brussels in December 2003 with Giscard’s text on the table, a text to which every member state had one objection or another, and no serious compromise proposals in their brief cases. The issues around which their differences revolved were numerous, and not every one was important to every member state or prospective member state. They can be summarised as:

• Spain and Poland’s refusal to accept changes to the decision-making system that had been agreed at Nice. According to that system, both countries were to be allocated 27 votes while Germany, which has twice the population of either Spain or Poland, would have 29.5 Neither Germany nor France was happy with this, favouring instead the ‘double qualified majority’ system. Most other member states supported (or at least accepted) this, but the UK had serious reservations. In addition, the UK was one of the countries most concerned to reserve certain policy areas to the system of unanimous voting, wishing to keep a national veto on most aspects of tax and



social security policy, judicial co-operation and defence and foreign policy.

• The reasons behind the different member states’ resistance to anything which smacked of their giving up infl uence in favour of a greater say for their ‘partners’: in the run up to the Convention, and during the period it was in session, big differences emerged between different blocs of member states. Deepening economic problems called forth rival solutions, with Britain and Spain leading the neoliberal pack and France and Germany favouring a more mixed approach, including a less savage – or at least more gradualist – attack on welfare systems and the public sector. In addition, Spain and the UK pursued a slavishly pro-US foreign policy, as did Poland and most of the new member states, while the rest of the existing EU ranged from outright hostility to Bush’s aggressive expansionism to, at the least, criticism of Bush and Blair’s decision to attack Iraq.

• Spending: when Germany was at the height of its boom it could tolerate an EU where it was the main contributor to central funds that were used to subsidise the poorer parts of the Union, while its economy sucked in demand and dominated high value-added production. Now Germany’s economy is less successful it wanted to curb spending, as it wished to cut its own contribution to the central funds. France supported Germany in calling for a freezing of the EU budget, which would have the effect of reducing subsidies to countries such as Poland and Spain. Britain was concerned to keep the budget rebate negotiated during the 1980s, without which, though far from being the richest member state, it would be in danger of becoming the largest net payer to EU funds.

• Failure of the Growth and Stability Pact: when the German economy was booming its leaders insisted on imposing stern fi scal discipline on the euro-zone. When, in 2002, Portugal breached the agreed limit, it was heavily fi ned. However, with the budget defi cit growing in most EU member countries, in 2003 France and Germany saw their own budget defi cits go well over the agreed limit fi xed by the Maastricht agreement, reaching 4 per cent. As things turned out, no one was able to impose the same kind of discipline on these big, powerful countries as had been so easy in the case of small, poor Portugal. This was eventually ‘settled’ by an agreement to make decisions on enforcement more responsive to cyclical changes in the



economy, but not until agreement had been reached on the constitution.

• Defence and Foreign Policy: there were continuing differences of opinion over the establishment and precise nature of the planned EU ‘core defence group’, a nebular European army. The two nuclear-armed states, France and Britain, tend to be suspicious of Germany, which for historical reasons continues to labour under numerous restrictions applied since 1945 to its right to arm itself. Germany’s attitude is that, not having invaded anyone at all for ages and ages, it should be allowed back into the grown-ups’ playground. The new member states are generally pursuing a pro-US, pro-NATO foreign policy and refl ect the United States’ mixed feelings over any attempt by the EU to develop an independent force. Britain was unhappy about any attempt to extend QMV to foreign policy issues.

• European Commission and Parliament: the dispute revolved around whether all member states should retain a commissioner.

• European President: the idea of having a single fi gurehead for the Union and chair of the European Council was popular, but great differences persisted as to the extent of his or her powers.

• Religion: Spain, Poland and Ireland wanted a specifi c mention of Europe’s ‘Christian heritage’. France would not accept this, while most other member states would certainly prefer any mention of religion or spirituality in the Constitution to be limited to generalities or guarantees of freedom of conscience and profession.

Lying behind the initial collapse was the fact that different member and applicant states have very different ideas of what enlargement should achieve. France and Germany perceive the new members of the European Union as the EU’s own Mexico, a place of ready markets and cheap labour. The new member states from the former Communist bloc, aside from being placed in a position in which alternatives to EU membership are diffi cult to see, appear to be hoping that they will witness a repeat of the economic ‘miracle’ which transformed Ireland. Conditions imposed on them, however, are not likely to encourage such optimism. Unlike Ireland, they may have to wait some time before they are allowed (or persuaded) to adopt the euro; their citizens will have to wait, also, before they enjoy



the full freedom to travel to other EU countries to work; and they will receive only 25 per cent of the agricultural subsidies which would be available to them if the current system were simply extended to include them. The new member states in general lag far behind countries like Germany and the Netherlands in terms of industrial production and economic ‘modernisation’. Their economies are heavily dependent on agriculture. Under the conditions of entry to the CAP it seems inevitable that the result of EU accession will be ruin for whole sectors and whole areas of the countryside.

THE IMMEDIATE FUTURE

One reason why the summit failed was clearly that it did not need to succeed. In the short term, the inability to agree a Constitution would have no profound consequences, especially as most of the more far reaching changes would have been implemented only after a considerable delay. The new voting system was not due to be implemented until 2009, for example.

However, the summit’s collapse was a huge political setback and the events leading up to it, the Convention, the way it operated and the nature of the proposal it produced, clearly had quite serious political errors. The collapse of negotiations and the response to this from national parliaments and the media, combined with the reality of enlargement, persuaded member states to return more quickly to the negotiating table than had been thought likely. Through the cumbersome and transparently undemocratic process of the Convention and the ultimate rejection of its work, the EU’s leaders had made themselves look foolish and wasteful, and only by coming to a swift and apparently amicable solution could this be put to rights. It was either that or face squarely the fact that the usefulness of the European Union to its ‘citizens’ was no longer evident to the vast majority of those so dubbed.

In the immediate wake of the initial failure, optimistic EU integrationists were thin on the ground. However, in the weeks following, the Irish, who took over the EU Presidency in January 2004, were beginning to sound out the various leaders to see what might yet be achieved. By the time of the Dublin Summit of March 2004, the Heads of State or Government were willing to accept the Taoiseach’s invitation to declare in principle that they were determined to overcome remaining differences of opinion, and to set up a series of ministerial meetings resolved to fi nd compromises



leading to agreement on the outstanding issues. This was fully successful, and on 17–18 June, the Heads of State or Government of the Fifteen came together with their ten new colleagues, in Brussels, to approve the new text.

The text, worked out over nine ministerial meetings and countless intermediate sessions involving the most senior of each government’s civil servants, in truth differed little from that proposed by Giscard d’Estaing. The important features of these changes concerned, for the most part, institutional and fi nancial matters, and can be summarised as follows.

The Commission

• The Commission to be appointed before the end of the year would have one member from each member state. However, from the end of its fi ve-year term of offi ce it would be reduced in size to a number equivalent to two-thirds of the total number of member states, with member states being ‘treated on a strictly equal footing as regards determination of the sequence of, and the time spent by, their nationals as Members of the Commission’. The door was, however, left open for further change as the system may be reformed by a unanimous vote of the Council.

• The President of the Commission would be appointed by the Council subject to a simple majority vote of approval by the Parliament. Should the candidate be rejected, the Council would have one month to nominate a new one, nominations to be by QMV.

• There would be a new Union Minister for Foreign Affairs who would be a member of the Commission.

• The Commission as a body would, as now, be subjected to a vote of approval by the Parliament and might be removed by a vote of no confi dence by the same body, but as now, individuals might be removed only by the Commission President’s asking for their resignation.

The Council

• When the Council is acting on a proposal from the Commission or Union Minister for Foreign Affairs, a qualifi ed majority under QMV would now be defi ned as at least 55 per cent of member states comprising at least 65 per cent of the Union’s population. At least four members would be needed to form a blocking



minority. When not acting on such a proposal, the qualifi ed majority would be defi ned as 72 per cent of the members of the Council, representing also 65 per cent of the population. If a substantial number of member states, but fewer than needed to form a blocking minority, should object to a decision, ‘the Council shall discuss the issue’ and ‘do all in its power to reach ... a satisfactory solution ...’ These changes would be introduced on 1 November 2009.

The Parliament

• Membership would be limited to 750, however many member states there may eventually be. No member state shall have more than 96 of these, but the details were left to a unanimous decision of the European Council to be taken before the 2009 election and ‘as necessary thereafter for further elections’.

The Euro

• Special provisions were laid down for voting in Council in instances where only euro-zone countries would be entitled to participate.

Economic And Employment Polices

• Member states would be obliged to coordinate their economic and employment policies within broad guidelines determined by the Union.

Stability And Growth Pact

• This was subject to a declaration, an inherently non-binding statement which, as it stated that ‘a rules-based system is the best guarantee for commitments to be enforced and for all Member States to be treated equally’, has already been contradicted by events since it was signed. The reaffi rmation of the commitment to ‘the goals of the Lisbon Strategy’ is more credible, though even in that case it is notable that levels of spending originally projected to achieve the Strategy’s aims did not survive the budgetary review of 2005.

Multiannual Financial Framework

• The member states’ commitment to EU budgetary discipline is reaffirmed in the form of a commitment to impose, by



unanimous vote in Council and with the Parliament having no more than the right of consent, a binding Multiannual Financial Framework, with which the annual budget must each year comply.

Charter of Fundamental Rights

• The controversy over the Charter of Fundamental Rights had concerned not its content, which had been agreed at Nice, but its legal status, with the UK in particular concerned that it should not be binding. This controversy was, however, fudged rather than resolved: the Charter’s status was no clearer after the agreement than before it, and must await further law, a further treaty or declaration, or developments in jurisprudence.

Eurojust

• As with the Charter of Fundamental Rights, controversy surrounded the precise legal position of this new system for judicial cooperation, with member states anxious to enable cooperation, but equally anxious not to agree to anything which might undermine their sovereignty. Again, the language in the declaration concerning Eurojust was deliberately left open to more than one interpretation.

Enhanced Co-operation

• Slight changes to the text were made in order to guard against the obvious possibility that enhanced co-operation should lead to a ‘two-speed Europe’, a curious procedure given that that is precisely what it is intended to make possible.

Economic, Social and Territorial Cohesion

• This was naturally a particular concern to poorer member states, including the newly acceded countries. Relatively low income countries had been unhappy with the original text, and succeeded in winning some apparent concessions. Among ‘least favoured regions’, the additional text noted, ‘particular attention shall be paid to rural areas, areas affected by industrial transition, and areas which suffer from severe and permanent natural demographic handicaps’, though this last would also be of benefi t to poorer regions of states which overall fi gure amongst the Union’s richest, including as they do



‘northernmost regions with very low population density’. This was also, then, clearly a concession to some of the EU’s least enthusiastic member states. A concern for ‘Territorial cohesion’ also lay behind the declaration, under the heading ‘Transport’, that ‘account shall be taken of cases where (the application of transport-related EU law) might seriously affect the standard of living and level of employment in certain regions, and the operation of transport facilities’.

Energy

• Here the member states asserted their ‘right to determine the conditions for exploiting (their) energy resources’ and to ‘take the necessary measures to ensure their energy supply’ in keeping with the Treaty.

Declarations and Protocols Relating to Individual Member States

• In order to secure agreement, a number of concessions to individual member states were needed. These can be summarised as:

1. the exclusion of the UK and Ireland from common policies relating to border controls, asylum and immigration;

2. a euphemistic reference to the position of Gibraltar ‘as a European territory for whose external relations a Member State is responsible’ and to which the Constitutional Treaty will apply;

3. an assertion by the Netherlands of its right to determine its relationship with the Antilles;

4. an assertion by the Netherlands that it will not fully go along with budgetary provisions until ‘a satisfactory solution’ is found ‘for its excessive negative net payment position vis a vis the European Union budget’.

WHAT NEXT?

The proposal, having been originally strangled at birth, then reborn at Dublin, did not survive the attentions of the electorates of France and the Netherlands, though it had been endorsed by referendum in Spain where participation had, however, been embarrassingly low. Unlike the Spanish, the French and Dutch turned out in huge



numbers and voted decisively against a Treaty which was widely regarded as elitist, if not incomprehensible. Although traditional right-wing scaremongering about mass immigration and the possible impact of Turkish entry played a role, in each case poll evidence pointed clearly to the fact that the left’s arguments had been decisive. People saw the Constitution as a threat to their public services, to the principle of universal access, and to their right to determine their own future, including in relation to the mix of public, state or social ownership and free market capitalism which should characterise their countries’ economy. Whatever I as a radical socialist or the neoliberals whose views prevail in Brussels and Washington may think, most people can see merits in both systems, believing that different approaches are appropriate for different areas of the economy. If the Constitution had been adopted, its acceptance would have represented a tremendous victory for all those who wish to see Europe made into a perfect environment in which corporate capital can fl ourish, its will unrestrained by considerations of social solidarity or environmental protection. People were frank about voting against, or abstaining, on the simple grounds that the proposal was incomprehensible, which in many ways it was. Even the ultra-conscientious citizen who decided to read the thing in its entirety would inevitably misunderstand whole sections, unless he or she had spent years steeped in the mysteries of Eurospeak. People generally understood well enough, however, that in voting ‘Yes’ they would be voting for a stronger dose of what they had been handed since Maastricht: privatisation, deregulation, liberalisation, all in the name of a mysterious ‘competitiveness’ which appears to be devouring everything which Europeans have achieved over 60 years since our continent lay in ruins.6

Now that the Constitution has suffered these defeats, the forces behind it will undoubtedly make another attempt to foist what will amount to the same programme on us. The European Union’s journey rightwards will continue, unless it is stopped by conscious action, by enough people standing up and saying ‘No, this is not what we want and we are not going to tolerate it.’ There are alternatives, and we must fi nd them and insist upon them, or we will end up with the kind of free market paradise beloved of Blair, Balkenende and Berlusconi. This EUtopia of the right may be achieved by the presentation of a renewed or revised Constitution. It may involve the addition of annexes and protocols reassuring the electorates of those countries



which have voted ‘No’, offering sops or even genuine concessions. A third possibility is that the elite will proceed as recommended in the old spoof on ‘The Red Flag’, which has the Labour Party singing ‘We’ll change the system bit by bit, so nobody will notice it.’ What is certain is that the anti-democratic forces which now dominate European political life are not going to disappear. These people have wasted millions of euros of our money on a failed Convention and an Intergovernmental Conference whose work has been thrown out by the electorates not of notoriously ‘eurosceptic’ countries such as the UK or Sweden, but by those of two of the original member states, countries in which the existence of some form of European Union goes unquestioned. Their response to this was, however, not to reassess their politics, still less to apologise, but to claim that they were misunderstood. Brecht once accused the government of the GDR, the former East Germany, of wanting to dissolve the people and elect a new one. Dominique de Villepin, who became French Prime Minister in the wake of the referendum debacle, did not go quite so far, saying instead that it was important to ‘interpret the message’ that the French people had sent. The widespread response to this may have lacked Brecht’s wit, but it was nevertheless apposite and amusing: which part of ‘Non’ did he not understand?

This European Union is a neoliberal project and an antidemocratic one, with or without its new Constitution. Time and again we see reforms, carried out in the name of economic integrationism, which undermine political democracy. Countries are admitted to the Union following referenda in which the ‘Yes’ campaign’s propaganda consists of lies, half-truths and irrelevancies. We are witnessing, in addition, the militarisation of a ‘Union’ which is supposedly being constructed in the name of peace, and the infl icting on people of an unwanted and bogus ‘citizenship’ over which none of the ‘citizens’ has been so much as consulted. Monetary union is sold to people in the most facile way, with no explanation as to what it really means and no admission of what it is really for. Successive summits attempt to convince us that a system which has kept unemployment high for decades can be transformed into a job creation machine, though of course we may have to give up a few social rights to achieve the promised land of full employment. A Community responsible for the Common Agricultural Policy, certainly the biggest single cause of environmental degradation in western Europe since the war, now presents itself as a champion of the environment. And so on. Try as



I might, I have been unable to identify a single policy area in which the Treaty of Rome has in itself had a benefi cial effect. Everything the EU does is either undesirable or could have been better achieved by other means, and this will only change when we, the peoples of Europe, change it.


18Conclusion

My ambitions in writing this book were twofold. Firstly, I wanted to provide students with a basic guide to how the European Union functions. There are plenty of these around already, of course, but they are invariably written by people with a vested interest in spreading the integrationist gospel. This can make them quite painful to read, but it also distorts what they have to say. Certain arguments – such as that Qualifi ed Majority Voting is inherently undemocratic, or that all sorts of feasible alternatives to this European Union exist – are deemed unworthy of consideration and simply ignored. For this writer, on the other hand, such questions go to the heart of the matter and, whatever side of the fence you eventually land on, no meaningful analysis of the EU is possible until they have been dealt with.

My second aim was to present a critique of the EU and its integrationist project which attempts to get right away from the question of nationalism and internationalism. I have written this book as an Englishman who recently moved from Belgium to France. Until the beginning of 2005 I worked for an international organisation, representing a Dutch political party on the secretariat of the United Left Group in the European Parliament. Like most left-minded people of my generation I associate the Union Jack and fl ag of St George with fascist demonstrators. I believe nationalism to be the religion of fools and a major weapon in the armoury of charlatans. Yet I have no more time for ‘European’ nationalists than I do for any other kind. The sight of adults waving fl ags is generally an unedifying spectacle, whatever symbols appear on them, twelve gold stars included. On the other hand, the fact that decisions should be taken as close to home as possible, that the further away in distance and culture decision-making bodies become, the greater advantage to the rich lobbyist, these are sound reasons for defending the rights of national parliaments to do what they are supposed to do: express the will of the people. The fact that elected national bodies do this imperfectly is inarguable; but the European Parliament, the Committee of the Regions, the Economic and Social Committee – none of these expresses any will other than its own.

179



Culturally, nationalism is a dead end and the world deserves to be the oyster of all of us. ‘European’ nationalism, as promoted by the self-styled ‘pro-Europeans’, is no different to any other kind. The EU is just part of a continent which is, in reality, merely a peninsula of the Eurasian land mass. The successful Norwegian campaign against accession had a slogan which captures this perfectly: Europe is too small for us.

THE EUROPEAN UNION: A SUMMARY OF THE CRITICISMS

In each chapter of this book you will fi nd reasons, I believe, to question whether the EU in its present form is really the best approach to governance in the twenty-fi rst century. Having spent 18 years working within one of its institutions (the European Parliament), I have seen nothing to disabuse me of the view that the integrationist project serves only one agenda – that of the multinational corporations (MNCs) whose growing hegemony of power at all levels threatens everything that has been gained by people in developed countries over the last two centuries: democratic rights and freedoms, economic security, the chance to live a dignifi ed, productive, fulfi lling life. This chance is now denied to a greater or lesser extent to growing numbers of people, whilst for most in the underdeveloped world it is further away than ever.

Numerous impulses fed into the original drive to establish the European Economic Community: the desire for a sustainable peace and the fear that Franco-German rivalry would once again destabilise the continent was certainly one of them. In the main, however, the Treaty of Rome set out to make western Europe safe for capitalism, and in particular for the biggest corporations, which wanted a domestic market comparable to that available to their American rivals.

Since then, the power of corporations has grown, and that of other social forces diminished. This is refl ected in the four major treaties – the Single European Act, and those of Maastricht, Amsterdam and Nice – which have carried integration ever further since the mid-1980s, and it reached its apotheosis in the text of the so-called Constitutional Treaty, in reality no constitution at all but a neoliberal political programme, an audacious attempt to transform a temporary political ascendancy into a set of permanent arrangements and institutions.

Of course, other infl uences can be detected: the hesitancy of some member state governments when it comes to handing over


Conclusion 181

power to supranational institutions; a cultural conservatism growing in part from the continuing power of Christianity (of various brands) in European social life; an understanding on the part of the more conscious sections of the ruling elite that the burgeoning environmental crisis is not some myth dreamed up by crazed eco-warriors; even, here and there, the aspirations of ‘ordinary’ men and women. The consistent theme, however, is that what’s good for business is good for everyone, and what’s good for business, of course, is to be able to make profi t with as few restraints as possible – even where these restraints involve the wellbeing of the environment or the people and other beings which inhabit it.

The so-called Washington Consensus, which has dominated the theory and practice of big capital and its political servants for almost two decades, is that government expenditure as a proportion of GDP must be reduced, whilst the infl uence of the state gives way to the ‘free play of market forces’. The corollaries of this idea, which lies at the heart of what is now known as ‘neoliberalism’, are far-reaching. It means fi rst of all that the state must withdraw from most spheres of economic activity. Nationalised industries must be sold off (in reality, most have been virtually given away). Where the market proves truly unable to provide a necessary service, you fi rst question its necessity: thus, public transport no longer exists in huge stretches of rural and small-town America, because well, everyone has a car (which of course is not true) and if you do provide buses nobody uses them. Universal postal services are no longer needed because it makes more sense to ensure that everyone has email. And so on. If you do admit that a service which cannot possibly be profi table is nevertheless necessary, you subsidise a private fi rm to provide it, so that the fi rm’s shareholders pick up the gains while the taxpayer covers the losses. And if people with more money can buy better food or a bigger car, why shouldn’t they also spend their money on health care, or education, or having themselves or their children genetically modifi ed so that they are brighter, taller, more beautiful than the rest?

Even to pose such questions demonstrates a moral bankruptcy and egotism which was once confi ned, at least publicly, to the fringes of the right, but which is now commonplace. The case for ‘the market’ is now rarely put – it is simply assumed; and with each successive revision of the Treaty, that assumption is carried further and deeper. Yet it rests, when examined, on the shakiest of foundations. Privatisation is necessary, we are told, because state-run enterprises



are ineffi cient. There is in fact no weight of evidence in favour of this view, and none is regarded as necessary. A political viewpoint which once had to compete with others has the fi eld to itself, transformed into a self-evident truth.

It is a ‘truth’ which guides the behaviour of the great institutions which run the system at global level – the IMF, the World Bank, the WTO, and so on – and in huge ‘regions’: NAFTA for North America, Mercosur for Latin America, ASEAN for the Far East and the European Union for a growing area of Europe. Of these, the EU is by far the most highly developed, and the one whose agenda most closely resembles that of the WTO. Yet the World Trade Organisation is greeted with universal hostility by those on the left of politics or in the green movement, whilst resistance to the EU is seen, if only in the English-speaking world, as anti-internationalist and inward-looking.

Let me then finish by summarising why, as someone whose thinking and practice have been shaped by the traditions of the anti-capitalist left, I am also an opponent of this European Union.

Firstly, its institutions and their basis in the Treaty of Rome and its amending treaties, remove power ever further from the people. The policies pursued by member state governments are increasingly constrained by EU rules which oblige them to impose a ‘free market’ logic on ever-broader areas of the economy. Decisions are taken by remote institutions – the European Central Bank, the European Commission, the Court of Justice – which are unelected and, with the partial exception of the Commission, not answerable to anyone who is elected. This means that the ballot box no longer offers a way to bring about any fundamental change in the direction of policy. The Council of Ministers, which at least represents elected governments, meets behind closed doors and has the power, in more and more instances, to impose policies on peoples whose parliaments have never been given the chance to approve or disapprove them. The European Parliament is so remote an institution that a majority of the EU electorate does not bother to exercise its right to vote in elections to it. The idea, still current in anti-EU circles, that the EP is a talking shop with no real power is outdated. Yet the increase in its powers has done nothing to democratise the Union, because its growing powers have been gained at the expense not of the Union’s unelected authorities but by further reducing those of the member states and their parliaments. Furthermore, its remoteness (and that of the Commission), in both geographic and cultural terms, from the lives of the vast majority of citizens tilts the balance away from


Conclusion 183

popular institutions and democratic civil society and towards big corporations. It is the multinationals which have the resources to keep up a permanent lobbying clamour in Brussels and Strasbourg, a degree and style of pressure which is utterly disrespectful to the democratic process and ultimately subversive of it. From top to bottom the Commission and Parliament are imbued with such an elitist, technocratic worldview that they are not even aware of it. Despite valiant efforts from environmentalist, social and other NGOs, legislation which furthers the interests of the people rather than those of corporate capital almost never appears except as a result of one of two things: a crisis, such as the BSE scandal, which threatens to kill thousands of people and destroy hundreds of thousands of livelihoods, can provoke emergency action which may or may not include an effective remedy; or the need to mediate between competing national industries can lead to higher standards being imposed upon lagging countries. It would be overly pessimistic to say that sustained campaigning can never gain anything without one of these circumstances being present; and it would be wrong to pretend that national political institutions represent some ideal of democracy. What is certainly true, however, is that the EU has removed power from national institutions which can be understood, talked to and infl uenced, and handed it to a labyrinth of remote bodies in faraway places.

Secondly, these aspects of the Union have their effects across the board of policies and programmes for which it is responsible. Enlargement of the EU is not a means of bringing the two formerly divided halves of Europe into a harmonious whole; on the contrary, it is the latest of the spoils of what was proclaimed as the West’s ‘victory’ in the Cold War. Democracy was, to say the least, much more in evidence to the west of the Iron Curtain than it was in the Eastern Bloc. Until the dying days of the Soviet system, however, democracy was defi ned in large part as a political system which allowed people to choose between competing economic systems: market-based capitalism, state socialism, a mixed economy on social democratic lines, or some combination of these. Freedom of expression, of the press, of assembly and so on, were secondary to this, necessary because clearly political democracy cannot function without them. Now, however, these freedoms, together with a multiparty parliamentary system, are the very defi nition of democracy, which is the automatic and unvarying political adjunct of a free market economy. Countries which lived in former times in the shadow of the USSR are now



‘free’ to join the European Union and adopt a particular, increasingly liberalised version of market capitalism as their economic system. Once in, their electorates have no opportunity to change this system through constitutional means. Of course, they could have stayed outside the EU and the WTO, but then no one would trade with them. They have therefore opted to join, hoping that the corrupt, chaotic, nepotistic and gangsterish capitalism which has replaced repressive state socialism will somehow be modifi ed by being ‘in Europe’. We shall see.

Meanwhile, to police the new Iron Curtain which is the border of the expanded Union with the countries of the former Soviet Union, the Union, this supposed guarantee of peace, steadily develops a military capability. If the system through which other policies are determined leaves much, from a democratic viewpoint, to be desired, the Common Foreign and Security Policy must take the prize. Based on an assumption that there exist such things as common European values, and that fundamental to these is the ‘market economy’, the CFSP is designed to allow the establishment of an EU armed force to protect the economic and political interests of the Union’s most powerful member states. This is what is meant by ‘stability’, of course: a framework in which foreign corporations can make money. Together with the promotion of a vibrant, competitive arms industry this is the CFSP’s purpose. If adopted, the new ‘Constitution’ would have required all member states, including those which are historically and constitutionally neutral, to ‘improve’ their defence capability with every year that passes.

The EU is also about maintaining internal order, as is clear from a reading of the Treaty of Amsterdam and much, most of it supportive, that has been written since that Treaty was signed. The ‘Third Pillar’ tentatively introduced at Maastricht and reinforced in Amsterdam represents a major inroad into what have been, after foreign policy, the most jealously guarded national competences: justice, the criminal law, immigration and refugee policy, and other aspects of what are tellingly known as ‘home affairs’. Again, decisions are taken in an atmosphere of secrecy and elected assemblies at national and EU level excluded from the process. Bogus conceptions of citizenship are written into the Treaty, a meaningless Charter of Citizens Rights agreed which imposes absolutely no new obligations on any of its signatories, and is thus a blank cheque written to the future. What the Union will require of us now we are all its citizens is, of course, unknown, but when such decisions are taken we will have


Conclusion 185

no involvement in them. The bogus ‘War on Terrorism’ launched in the wake of 9/11 has given the EU’s leaders, like those of the US, the perfect excuse to erode rights won over 200 years of developing liberal and democratic socialist political thought, backed up by popular struggle, rights which were, until recently, taken for granted by most citizens of western parliamentary democracies.

Probably the biggest single act of subversion of democracy committed in the name of the European Union, at least until the proposed Constitutional Treaty, has been the establishment of the single currency, the euro. The Maastricht Treaty’s convergence criteria for admission to the single currency and the rules for participation exactly follow the Washington Consensus, obliging member states to respect very narrow, arbitrarily established limits on public borrowing and debt, to submit to a common interest rate which may be utterly inimical to their actual needs, and to prioritise low infl ation as a policy target: to follow, in other words, a particular idea of fi scal prudence. These rules are impervious to electoral change, and they are imposed by an unelected board of central bankers, one of the narrowest ruling elites in recent history. Before the advent of the euro, macro-economic policy was decided by elected politicians together with central banks which were, in most countries, directly answerable to them. Since the introduction of the single currency, it is determined by a Central Bank constitutionally defined as ‘independent’, one which those same elected politicians are forbidden by the Treaty even to seek to infl uence. Interesting choice of word, that ‘independent’. In the context it means that it is able to operate entirely free of any constitutionally-sanctioned interference from the people or their elected representatives. The same can be said of Stalin, Hitler or the Sultan of Brunei, yet dictators are never described as ‘independent’.

The defence of this system is that ordinary people and politicians simply don’t understand how the economy works and would get it all wrong. The great danger with this is that this attitude can equally be applied to other areas of policy, for what do non-specialists know about how to run a school or a hospital, about whether biotechnologies are safe, whether that new motorway is really needed or that forest really did have to be felled? Macro-economics is not in any obvious way a more diffi cult discipline than ecology, or health care economics, or plant biology; so why not apply the same logic to them and let experts decide everything?



The answer is that in democratic societies the people, and even the politicians, being ordinary mortals with limited knowledge and specialisms, cannot possibly decide every aspect of policy. What they can do, however, and what democracy, when it is genuine and functioning, allows them to do, is to establish policy goals. It is then the task of experts to work out how such goals can be achieved. It is precisely this right which the single currency, and the single internal market which it was designed, in part, to underpin, remove from the peoples of the member states.

Nor do the malign effects of this European Union stop at its borders. In its relationships with the rest of the world, the Union demonstrates a merely rhetorical awareness of the imbalance of power between North and South and the dangers this holds for both. In reality, it acts quite unrestrainedly in pursuit of the short-term interests of European owners of capital, and its highly selective commitment to free trade and its protectionism in defence of its member states’ industries and agriculture have contributed much to the underdevelopment which has affl icted many of its poorer trading partners in the last three decades.

The EU’s employment and social policies have been entirely ineffective in reducing either unemployment or the growing social divide, which interestingly has been most marked in what are seen as the most ‘successful’ economies, those in which growth has been most rapid and sustained, the Netherlands and Ireland. Its much-vaunted environmental policies have done little or nothing to redress the damage wrought by Common Agricultural, Transport and Fisheries Policies, the last of which may just take the prize for the most disastrous of EU measures, though competition is stiff.

Finally, the European Union distorts the natural desire of people to live in peace and co-operation with their neighbours. The integrationist answer to problems invariably involves ever greater transfer of power from nation state to Union institution. The method is to take an obvious statement – that environmental problems require cross-border solutions; that the globalised economy demands international co-operation if it is not to be controlled by the unrestrained, beyond-the-law actions of corporate cowboys; that a large market and a unifi ed currency may hold advantages – and draw from it specious conclusions. Simply because we need an international approach to the problems facing humanity in the twenty-fi rst century does not mean that this international approach, this European Union, a single currency based on discredited and extreme monetarist principles, a


Conclusion 187

political system which seems almost designed to maximise corruption and the hegemony of wealthy elites, or a ‘Constitution’ which is in reality a neoliberal political programme are the only or best forms of international co-operation on offer.

Effective resistance is possible. In order to defend what is left of democracy, to create a genuine internationalism, and identify real alternatives for tackling the urgent problems facing all of our nations, we must fi rst leave all the fl ags at home, forget about whose picture is on our money, and make a bonfi re of all those national myths we were force-fed as children. Instead, look at the EU’s policies and just how they are made. I have tried to make this book, with its bibliographies, a starting point for doing just that. Unless you happen to be the CEO of a multinational corporation, I believe that you will fi nd that only one conclusion is possible.

If we are to develop genuinely international institutions which enable co-operation to take place whilst preserving the democratic rights of the peoples of different nations, then we must set about a root-and-branch re-examination and reconstruction of global governance. What cannot be reformed should be discarded, and what can be put to the service of the people should be reformed. In common with the WTO, the IMF, NATO and other instruments of globalised power, the European Union in its present form is an obstacle to real co-operation across borders of language, culture and history. Its likely result is an ever-growing divide between those who exercise power and those who must suffer the consequences of decisions taken by this elite. Though this may be the intention of some involved in the integrationist project, they are unlikely to enjoy the consequences. People denied peaceful means to bring about change can become apathetic, but sometimes they react in quite a different way. As anyone who has witnessed the events of the last two decades in Europe should know, they have even been known to dissolve long-standing Unions, reject the counsel of technocrats, and tear down walls.


Notes

1 INTRODUCTION

1. Investments Magazine, 1 February 2005, available at http://investmentsmagazine.com/ManageArticle.asp?C=60&A=11868

2. Ibid.

2 THE TREATIES

1. The full text of the Single European Act is available at http://europa.eu.int/abc/obj/treaties/en/entoc113.htm.

2. I have used this term throughout to mean someone who favours a more powerful, supernational European Union. I avoid the term ‘federalist’, as this denotes only one particular form of integration which is not always the one favoured. As for ‘pro-European’, this is a propaganda term intended to imply that to oppose or be unenthusiastic about this European Union is to be opposed to any conception of ‘Europe’.

3. The full text of the Treaty on European Union, the ‘Maastricht Treaty’, can be read at http://europa.eu.int/abc/obj/treaties/en/entoc01.htm. A thorough, but uncritical, summary of the Treaty and the background to it is at http://www.historiasiglo20.org/europe/maastricht.htm. This site is also notable for a picture of a crowd of two people celebrating the Treaty’s signing.

4. Patricia McKenna, MEP, Spectre, no. 5, Winter 1998, p. 6. The full text of the EU and EC Treaties as they looked after amendment at Amsterdam, as well as a comprehensive guide to the Treaty and various other documents and pieces of background information, can be found at http://europa.eu.int/abc/obj/amst/en/.

5. A useful background article on the Nice Treaty can be read at http://www.historiasiglo20.org/europe/niza.htm. The Conclusions of the Presidency of the European Council meeting at which the Treaty of Nice was agreed can be found at http://www.europarl.eu.int/summits/nice1_en.htm#II. The Treaty itself is at http://europa.eu.int/eur-lex/lex/en/treaties/dat/12001C/pdf/12001C_EN.pdf.

3 THE INSTITUTIONS

1. The option is made necessary only by France, which, uniquely amongst member states, has an elected head of state, its President, with full executive powers.

2. See note 1 above. 3. The Nice Treaty stipulated that this would occur from the admission

of the 18th member state. This condition was fulfi lled when, on 1 May 2004, membership of the Union leapt from 15 to 25.

188


Notes 189

4. Unlike the other major institutions, the European Council, being more of an idea than an actual entity, does not have its own website. A more detailed assessment than I have space for, and one from a different political perspective, can be found on the European Parliament’s website at http://www.europarl.eu.int/facts/1_3_7_en.htm.

5. Neither body should be confused with the Council of Europe, which has nothing to do with the European Union!

6. The Council’s website is at http://ue.eu.int/showPage.ASP?lang=en. 7. Each Presidency organises its own website. To look at the current and

past Presidencies’ websites, tap ‘EU Presidency’ into your search engine. This should produce a list going back several years.

8. Slightly more detail, and links to further information about COREPER, can be found at http://www.answers.com/topic/coreper.

9. Links to factsheets describing the work of the IGC of 2003–04 can be found at http://europa.eu.int/scadplus/cig2004/index_en.htm.

10. Constitutional Treaty Article I-16, available at http://europa.eu.int/constitution/en/lstoc1_en.htm.

11. See Chapter 5.12. Constitutional Treaty Article I-16, available at http://europa.eu.int/

constitution/en/lstoc1_en.htm.13. http://www.europa.eu.int/comm/role_en.htm gives the offi cial account

of the Commission’s powers, structure and activities. 14. For more on Paul van Buitenen, see http://www.freedomtocare.org/

page84.htm.15. A brief account of these events which is nevertheless more detailed than

space here allows is at http://library.lp.fi ndlaw.com/articles/00008/000963.pdf.

16. A full account of the second round of European Parliamentary hearings of the Commissioners-designate, which led to their endorsement by a large majority of MEPs, is at http://www.europarl.eu.int/hearings/commission/2004_comm/default_en.htm. The results of the first round, which was followed by the Parliament’s refusal to accept some nominations and its querying of others, is at http://www.europarl.eu.int/hearings/commission/2004_comm/result_en.htm.

17. The defi nition of a regional assembly embraces national but not state-level parliaments such as those of Scotland or Catalonia, a state parliament within a federal structure as in Belgium or Germany, and a body such as Stormont, which (when operating) enjoys legislative power over an area of a larger political entity. It would not, in other words, include a UK county council or similar intermediate but essentially local government structure.

18. Quoted in Steven P. McGiffen, ‘European Political Parties: An assault on democracy’, spectrezine, September 2004, available at http://www.spectrezine.org/europe/Europarties.htm.

19. The offi cial account of the ECJ and its work is at http://europa.eu.int/institutions/court/index_en.htm.

20. The offi cial website of the European Court of Auditors is at www.eca.eu.int/.

21. See http://www.esc.eu.int/pages/en/home.asp.22. See http://www.cor.eu.int/en/index.htm.



4 HOW THE EUROPEAN UNION MAKES LAW

1. See European Parliament Fact Sheets 1.2.1. Sources and scope of Community law, http://www.europarl.eu.int/facts/1_2_1_en.htm. For up-to-the-minute discussion on the problems arising from the EU legislative process and possible solutions to them, see the Commission’s ‘Governance’ website at http://europa.eu.int/comm/governance/index_en.htm.

2. You can follow any proposed measure through the EU legislative process by using the Legislative Observatory at http://wwwdb.europarl.eu.int/dors/oeil/en/default.htm.

3. For more details see European Parliament Fact Sheets 1.5.1. The Union’s revenue and expenditure at http://www.europarl.eu.int/facts/1_5_1_en.htm.

4. The offi cial account of all aspects of the budget can be found at http://europa.eu.int/comm/budget/index_en.htm.

5. See http://europa.eu.int/comm/budget/pdf/execution/execution/fi nancialreport03/rapfi n_en.pdf for the EU Financial Report, 2003. This was the most recent available to the author. More recent reports should be available when published at http://europa.eu.int/comm/budget/infos/publications_en.htm.

6. For a more detailed, but offi cial, account of the budgetary procedure go to http://europa.eu.int/comm/budget/budget/index_en.htm#stages, or http://europa.eu.int/scadplus/leg/en/lvb/l34013.htm.

7. The European Parliament’s function as a monitor of the budget can be followed through the website of its Committee on Budgetary Control at http://www.europarl.eu.int/comparl/cont/site/default_en.htm.

5 ENLARGEMENT

1. See ‘Enlargement’ on the offi cial website of the European commission representation in the United Kingdom, http://www.cec.org.uk/info/pubs/bbriefs/bb11.htm.

2. ‘Strategy Paper 2000’, available at europa.eu.int/comm/enlargement/report_11_00/ – 101k – 18 avr 2005.

3. See, for example, WWF press release ‘EU Enlargement: Boon or Bane for Nature?’, http://www.panda.org/news_facts/newsroom/features/news.cfm?uNewsID=12792.

4. See Institutional Changes for an Enlarged Europe, http://europa.eu.int/comm/igc2000/dialogue/info/practical/support/presentation/presentation1.pdf.

5. The European Commission’s enlargement website at http://europa.eu.int/comm/enlargement/index_en.html carries up to date news from this perspective.

6. ‘EU Postpones Croatia Entry Talks’, BBC News (on-line), http://news.bbc.co.uk/1/hi/world/europe/4351357.stm.

7. ‘Migration Likely to be about 1 per cent, Survey Says’, website of the European Foundation for the Improvement of Living and Working Conditions, http://www.eurofound.eu.int/newsroom/migration.htm.


Notes 191

8. European Foundation for the Improvement of Living and Working Conditions, Migration Trends in an Enlarged Europe (2004), http://www.eurofound.eu.int/publications/fi les/EF03109EN.pdf.

9. Hard information (fi gures, and so on) is taken from the Commission’s ‘Enlargement’ website (see note 1 above) and the ‘Frequently Asked Questions’ section at http://europa.eu.int/comm/enlargement/faq/index.htm.

10. See Chapter 13.11. For the offi cial view and some useful information on Norway’s current

relations with the EU, see the European Commission, The EU’s relations with Norway, http://europa.eu.int/comm/external_relations/norway/intro/; offi cial information on the EEA can be found at http://europa.eu.int/comm/external_relations/eea/index.htm.

6 THE COMMON FOREIGN AND SECURITY POLICY

1. Consolidated Version of the Treaty on European Union, http://europa.eu.int/eur-lex/en/treaties/dat/C_2002325EN.003301.html.

2. Patricia McKenna, ‘The Amsterdam Treaty: The Road to an Undemocratic and Military Superstate’, http://www.notlimitednyc.com/folio/pmckenna/pdf/AmTrBook.PDF.

3. These are very broad estimates, as reliable information on this secretive industry is hard to come by. See the report Arms Industry Transparency at http://www.notlimitednyc.com/folio/pmckenna/pdf/AmTrBook.PDF. The Bangemann quote comes from McKenna, ‘The Amsterdam Treaty’. The fi gures come from European Parliament Fact Sheets 4.7.10. Defence industry, http://www.europarl.eu.int/facts/4_7_10_en.htm.

4. Title V of the EU Treaty (CFSP), also known as the ‘Second Pillar’, contains the provisions establishing a Common Foreign and Security Policy. See The Amsterdam Treaty: A Comprehensive Guide (the offi cial rundown on the Treaty) at http://europa.eu.int/scadplus/leg/en/lvb/a19000.htm.

5. Ibid. 6. See, for example, Judy Dempsey, ‘EU-led Forces “Could Intervene” in

Sudan Confl ict’, Financial Times, 12 April 2004; Shada Islam, ‘The EU’s First-Ever Security Doctrine: In the Wake of Squabbles over Iraq, Europe Unites under a Common Foreign Policy’, YaleGlobal, 4 July 2003, http://yaleglobal.yale.edu/display.article?id=2023.

7. See the offi cial CFSP website at http://europa.eu.int/comm/external_relations/cfsp/intro/, and Conclusions of the European Council, Cologne, 3–4 June 1999, http://www.europarl.eu.int/summits/kol1_en.htm#V.

8. See the Irish Campaign for Nuclear Disarmament’s John Goodwillie, ‘Security Aspects of the Nice Treaty’, http://indigo.ie/~goodwill/nice.html.

9. Headline Goal 2010, http://ue.eu.int/uedocs/cmsUpload/2010per cent20Headline per cent20Goal.pdf.

10. NATO Handbook, Chapter 15: ‘The Wider Institutional Framework for Security: The European Union (EU) – The Common Foreign and Security



Policy (CFSP)’, at http://www.nato.int/docu/handbook/2001/hb150302.htm.

11. CFSP website, http://europa.eu.int/comm/external_relations/cfsp/intro/.

7 CITIZENSHIP, JUSTICE AND SECURITY

1. Treaty on European Union, Offi cial Journal of the European Communities, C 191, 29 July 1992; see also French government website for an interesting look at Maastricht-conferred citizenship from a less sceptical point of view, http://www.diplomatie.gouv.fr/label_france/ENGLISH/DOSSIER/presidence/05.html.

2. Treaty of Amsterdam amending the Treaty on European Union, the Treaties establishing the European Communities and related acts, Offi cial Journal of the European Communities, C 340, 10 November 1997, http://europa.eu.int/eur-lex/lex/en/treaties/dat/11997D/htm/11997D.html.

3. Ibid. 4. Text and commentary on the Charter can be found at http://www.

europarl.eu.int/charter/default_en.htm. 5. Treaty establishing a Constitution for Europe, Art. I-9, http://ue.eu.int/

igcpdf/en/04/cg00/cg00087-re01.en04.pdf. 6. See The Schengen Acquis and its Integration into the Union on the EU’s Justice

and Home Affairs website at http://europa.eu.int/scadplus/leg/en/lvb/l33020.htm.

7. See European Parliament Fact Sheets 4.11.1. Justice and Home Affairs: General Aspects, http://www.europarl.eu.int/facts/4_11_1_en.htm.

8. These concerns were summarised in The Right to Asylum in the European Union, a section of Human Rights Watch’s 1998 World Report, which remains available on-line at http://hrw.org/worldreport/Helsinki-28.htm; see also Riva Kostaryano, Transnational Participation and Citizenship: Immigrants in the European Union, http://www.transcomm.ox.ac.uk/working per cent20papers/riva.pdf.

9. See European Parliament Fact Sheet 2.3.0. Freedom of Movement for Persons, http://www.europarl.eu.int/facts/2_3_0_en.htm.

10. See Council Regulation (EC) No 2252/2004 of 13 December 2004 on Standards for Security Features and Biometrics in Passports and Travel Documents Issued by Member States, http://europa.eu.int/eur-lex/lex/LexUriServ/LexUriServ.do?uri=CELEX:32004R2252:EN:HTML.

11. An interesting discussion of these issues is presented by the Ombudsman of one member state, Emily O’Reilly of the Republic of Ireland, in International Ombudsman Institute VIIIth International Conference Workshop 10, Protecting Rights and Freedoms, 9 September 2004, http://ombudsman.gov.ie/24aa_156.htm.

12. See Schengen Information System II on offi cial EU Justice and Home Affairs website, http://europa.eu.int/scadplus/leg/en/lvb/l33183.htm; see also ‘SISII Takes Ominous Shape’ at http://www.statewatch.org/news/2002/apr/01sis.htm.

13. ‘European Data Protection Supervisor Says Exchange of Criminal Records Proposal is Not Proportionate – Will the Commission Heed the Opinion?’,


Notes 193

Statewatch News, 13 March 2005, http://www.statewatch.org/news/2005/mar/03eu-dp-crim-record.htm.

14. A more detailed guide to post-9/11 developments is the Statewatch Submission to the Network of Independent Experts on Fundamental Rights in the EU, www.statewatch.org/news/2003/oct/22swsub.htm; see also the report of the body to whom this submission was made, EU Network of Independent Experts in Fundamental Rights (CFR-CDF), The Balance Between Freedom and Security in the Response by the EU and its Member States to the Terrorist Threat, http://europa.eu.int/comm/justice_home/cfr_cdf/doc/obs_thematique_en.pdf.

8 MONETARY POLICY

1. For a good overview see Alan J. Brown, ‘Five Economic Tests’ CIO Report, July 2003, http://www.ssga.com/library/povw/alanbrown5 conomictests20030722/page.html; see also ‘Two Near Misses and Two Nos in Euro Tests’, Financial Times, 3 June 2003.

2. Quoted in Jeremy Nieboer, The Pros and Cons of Monetary Union, http://www.bullen.demon.co.uk/nieboer.htm.

3. See Price Waterhouse Cooper, ‘White Paper’, Managing Mobility Matters: A European Perspective, 2002; European Commission, Report on the Implementation of the Commission’s Action Plan for Skills and Mobility. COM (2004) 66 fi nal, 6/2/2004, http://europa.eu.int/comm/employment_social/skills_mobility/doc/com_04_66_fi n_en.pdf.

4. ‘Eurozone Teetering on Brink of Recession’, EU Business, 09 September 2003, http://www.eubusiness.com/afp/030909124356.j6s30b0u/.

5. ‘EU Ministers Finalise Euro Deal’, BBC News on-line, 21 March 05, http://news.bbc.co.uk/1/hi/business/4367149.stm.

6. Rob Hamilton, ‘Trends in Households’ Aggregated Secured Debt’, Bank of England Quarterly Bulletin, Autumn 2003, http://www.bankofengland.co.uk/qb/qb030301.pdf,; Matthew Hancock, ‘Household Secured Debt’, Bank of England Quarterly Bulletin, Autumn 2004, http://www.bankofengland.co.uk/qb/qb040302.pdf.

7. Michel Chossudovsky, War and Globalisation: The Truth behind September 11 (Shanty Bay, Canada: Global Outlook, 2002)

8. Technical details are taken from European Parliament Fact Sheets Part V, Economic and Monetary Union, http://www.europarl.eu.int/facts/default_en.htm#5.

9 THE INTERNAL MARKET

1. European Commission, Completing the Internal Market: White Paper from the Commission to the European Council (Milan, 28–29 June 1985) COM (85) 310.

2. The Cassis de Dijon ruling can be read at http://law.pravri.hr/hr/zavodi/ielcl/040227/cassisdeDijon.pdf; see http://www.europarl.eu.int/facts/3_2_1_en.htm for a more detailed explanation of this aspect of the internal market.



3. See European Parliament Fact Sheet 3.3.3. State Aid, http://www.europarl.eu.int/facts/3_3_3_en.htm.

4. See European Parliament Fact Sheet 3.3.1. General Competition Policy and Concerted Practices, http://www.europarl.eu.int/facts/3_3_1_en.htm.

5. European Parliament Fact Sheet 3.1.0. Principles and General Completion of the Internal Market, http://www.europarl.eu.int/facts/3_1_0_en.htm.

6. See ‘Chemistry Cleans It Up’, http://www.pr.mq.edu.au/macquest/sciences2.htm

7. See European Parliament Fact Sheet 2.3.0. Freedom of Movement for Persons, http://www.europarl.eu.int/facts/2_3_0_en.htm.

8. The full text of the Directive is at http://europa.eu.int/eur-lex/lex/LexUriServ/LexUriServ.do?uri=CELEX:31988L0361:EN:HTML.

9. ‘Tobin Tax Illegal in European Union’, Spectre Weekly News Review, 17 March 2001, http://www.spectrezine.org/weeklynewsreview/wnr17,03,01.htm.

10. For an interesting and informed view of this problem, see Further Liberalisation of the Postal Services, National Federation of SubPostmasters Submission of Written Evidence to Sub-Committee B of the House of Lords European Union Committee, at http://www.subpostmasters.org.uk/research per cent20briefi ng per cent20further_liberalisation_of_the_po.htm.

11. See Charlie McCreevy, Speeches: The Services Directive, http://europa.eu.int/comm/commission_barroso/mccreevy/speeches/index_en.htm; see also Steve McGiffen, ‘The Directive That Came From Hell’, 28 January 2005, http://www.spectrezine.org/Editorial/servicesdirective.htm.

12. European Commission, Internal Market Strategy, http://europa.eu.int/comm/internal_market/en/update/strategy/.

13. European Commission Press Release, ‘Single Market: Good Progress Except in Services’, http://europa.eu.int/comm/internal_market/en/update/strategy/index.htm.

14. European Parliament Fact Sheet 3.1.0. Principles and General Completion of the Internal Market.

15. Consolidated version of the Treaty on European Union, http://europa.eu.int/eur-lex/en/treaties/dat/eu_cons_treaty_en.pdf.

16. See the website of the European Commission Directorate General on Health and Consumer Protection, europa.eu.int/comm/dgs/health_consumer/index_en.htm; for a more critical view see the website of the European consumer groups’ umbrella organisation, BEUC, http://www.beuc.org/Content/Default.asp.

17. European Commission Directorate General on Health and Consumer Protection, Consumer Protection in the European Union: Ten Basic Principles, July 2004, http://europa.eu.int/comm/consumers/cons_info/10principles/en.pdf.

10 EXTERNAL ECONOMIC RELATIONS

1. For a detailed account of the EU’s customs system, see http://europa.eu.int/scadplus/leg/en/s28000.htm.


Notes 195

2. A comprehensive list of such actions can be found at http://europa.eu.int/comm/external_relations/cfsp/sanctions/measures.htm.

3. For a full account of how the ACP system works, see http://europa.eu.int/scadplus/leg/en/s05032.htm.

4. See ‘EU Guides – External Trade in the European Union – Overview’, on the website EU Business at http://www.eubusiness.com/guides/trade.

5. Larry Elliott and Charlotte Denny, ‘EU’s Secret Plans Hold Poor Countries to Ransom’, Guardian, 25 February 2005; the website GATSwatch follows developments in this area and contains links to material representing allpoints of view: http://www.gatswatch.org/index.html.

6. For the offi cial view, see http://europa.eu.int/comm/development/index_en.htm; for a more critical view, see the publication from the British Overseas NGOs for Development (BOND), Tackling Poverty: A Proposal for European Union aid reform, at http://www.bond.org.uk/pubs/eu/tackling-pov.pdf.

7. See http://www.developmentgoals.org/ 8. Oxfam, ‘EU Heroes and Villains: Which countries are Living Up to Their

Promises on Aid, Trade, and Debt?’, http://www.oxfam.org.uk/what_we_do/issues/debt_aid/eu_heroes_villains.htm.

11 EMPLOYMENT AND SOCIAL POLICY

1. Yves Clarisse (Reuters report, 25 January 2005), ‘Growth, Jobs Top EU Executive’s 2005–2009 Gameplan’ available inter alia at http://english.epochtimes.com/news/5–1–25/26004.html.

2. The Internet offers a number of explanations of the problematic nature of GDP as an indicator of economic or general wellbeing which are much fuller than there is space for in this book. See, for example, Alternatives to the GDP at http://www.consultmcgregor.com/PDFs/GDP%20and%20GPI.pdf, and Problems with GDP as an Indicator of Development and Better Alternatives at http://www.wscsd.org/ejournal/article.php3?id_article=121.

3. European Commission Directorate General for Employment and Social Affairs, European Employment Strategy Home Page, The EES: A Key Component of the Lisbon Strategy, http://europa.eu.int/comm/employment_social/employment_strategy/index_en.htm.

4. Presidency Conclusions, Stockholm European Council, 23–24 March 2001, http://www.eu2001.se/static/pdf/conclusions/conclusions_eng.PDF.

5. European Commission, Social Agenda 2005–2010, http://europa.eu.int/comm/employment_social/social_policy_agenda/social_pol_ag_en.html.

6. European Commission Directorate-General for Employment and Social Affairs, European Employment Strategy Home Page, The EES: A Key Component of the Lisbon Strategy, http://europa.eu.int/comm/employment_social/employment_strategy/index_en.htm.



7. European Commission Communication, Social Policy Agenda, http://europa.eu.int/comm/employment_social/general/com00–379/com379_en.pdf.

8. See James Galbraith, ‘The American Economic Problem’, Intervention, vol. 4 (2004), no. 1, http://www.ecaar.org/Network/NewsNotes/galbraith.htm, for an expert analysis of the illusory and unsustainable nature of US economic ‘success’.

9. European Commission Directorate-General for Employment and Social Affairs, European Employment Strategy Home Page, The EES: A Key Component of the Lisbon Strategy, http://europa.eu.int/comm/employment_social/employment_strategy/index_en.htm.

10. Historical, background and current offi cial documents on the Lisbon Strategy can be found at http://europa.eu.int/growthandjobs/index_en.htm.

11. Facing the Challenge: Report from the High Level Group chaired by Wim Kok, http://europa.eu.int/comm/lisbon_strategy/index_en.html.

12. Ibid.13. Ibid.14. ETUC Executive Committee Resolution adopted 22 March 2001. The full

text of all ETUC resolutions on the Lisbon Agenda can be found on the website: http://www.etuc.org.

15. European Parliament Fact Sheets 4.8.5. Health and Safety at Work, http://www.europarl.eu.int/facts/4_8_5_en.htm.

16. For a complete list of EU health and safety at work legislation, go to http://www.europa.eu.int/eur-lex/en/lif/reg/en_register_05202010.html.

17. European Agency for Health and Safety at Work, http://europe.osha.eu.int/.

18. A full list of labour law measures is at http://europa.eu.int/comm/employment_social/labour_law/documentation_en.htm.

19. Directive 75/117 on the approximation of the laws of the member states relating to the application of the prionciple of equal pay for men and women, http://www.equalitytribunal.ie/htm/equality_legislation_reviews/pdf/council_directive_75.117.ec.pdf.

20. All of these measures can be found in full on the EU’s Community Legislation in Force (Lex) website, where they are listed on the ‘Analytical Register – Freedom of Movement for Workers and Social Policy’, http://europa.eu.int/eur-lex/en/lif/ind/en_analytical_index_05.html . However, gender-related legislation has no separate category, so for a slightly less comprehensive but easier-to-use listing try the Republic of Ireland’s Equality Tribunal website at http://www.equalitytribunal.ie/htm/equality_legislation_reviews/eu_directives.htm.

21. The ECJ ruling of 17 October 1995, Kalanke, C-450–93 held that positive action policy on recruitment and promotion contravened the 1975 Directive on equal treatment Judgment of the Court of 17 October 1995. Eckhard Kalanke v. Freie Hansestadt Bremen. Reference for a preliminary ruling: Bundesarbeitsgericht – Germany. Equal treatment of men and women – Directive 76/207/EEC – Article 2 (4) – Promotion – Equally qualifi ed candidates of different sexes – Priority given to women. Case C-450/93. http://europa.eu.int/smartapi/cgi/sga_doc?smartapi!celexplus!


Notes 197

prod!CELEXnumdoc&lg=en&numdoc=61993J0450. See Peter Noorlander, ‘Affi rmative Action: Recent Developments’, Student Human Rights Law Centre Newsletter, February 1996, at http://www.nottingham.ac.uk/law/hrlc/hrnews/feb96/affacti.htm.

22. Judgment of the Court of 11 November 1997. Hellmut Marschall v. Land Nordrhein-Westfalen. Reference for a preliminary ruling: Verwaltungsgericht Gelsenkirchen – Germany. Equal treatment of men and women – Equally qualifi ed male and female candidates – Priority for female candidates – Saving clause. Case C-409/95. http://europa.eu.int/smartapi/cgi/sga_doc?smartapi!celexplus!prod!CELEXnumdoc&lg=en&numdoc=61995J0409.

23. Full details of EU action in the area of gender equality can be found at http://europa.eu.int/scadplus/leg/en/s02310.htm.

24. Full details of EU action in the area of disability policy can be found at http://europa.eu.int/scadplus/leg/en/s02311.htm.

25. That is, the same URL covers actions in favour of older people.26. See Increasing the Employment of Older Workers and Delaying the Exit from the

Labour Market, http://europa.eu.int/scadplus/leg/en/cha/c11309.htm.27. European Parliament Fact Sheet 3.2.3. Freedom of Establishment, Freedom

to Provide Services and Mutual Recognition of Diplomas, gives details of the latest development, at http://www.europarl.eu.int/facts/3_2_3_en.htm.

28. European Parliament Fact Sheet 4.16.0. Education, Vocational Training and Youth Policy, http://www.europarl.eu.int/facts/4_16_0_en.htm.

29. European Parliament Fact Sheet 4.8.2. The European Social Fund; European Commission ESF 2000–2006, http://europa.eu.int/comm/employment_social/esf2000/index-en.htm.

12 THE ENVIRONMENT AND PUBLIC HEALTH

1. http://europa.eu.int/comm/environment/newprg/. 2. http://europa.eu.int/comm/environment/eia/home.htm. 3. A ‘Global Assessment’ of the Programme, including contributions from

NGOs, is at http://europa.eu.int/comm/environment/newprg/global.htm.

4. The Programme, called Environment 2010: Our Future, Our Choice, and a summary, are at http://europa.eu.int/comm/environment/newprg/; more information from offi cial sources can also be found at http://europa.eu.int/scadplus/leg/en/lvb/l28027.htm.

5. This is necessarily a sketchy account of the Kyoto Protocol. For full information go to http://unfccc.int/. The European Commission’s climate change home page is at http://europa.eu.int/comm/environment/climat/home_en.htm. A critical comment on the Kyoto Protocol’s emissions trading system, entitled ‘As Climate Change Treaty Comes into Force, UK Research Group Calls for Change of Approach’, can be read at http://www.spectrezine.org/weblog/index.php?p=50.

6. European Commission Press Release, ‘Commission Confi rms Quality of European GMO Legislative Framework’, 22 March 2005; for a full account of the European Union’s laws on biotechnology see Steven P. McGiffen,



Biotechnology: Corporate Power versus the Public Interest (London: Pluto Press, 2005), pp. 6–37.

7. The full text of the original proposal can be read at http://europa.eu.int/comm/enterprise/chemicals/chempol/whitepaper/reach.htm. The consultation document is at http://europa.eu.int/comm/environment/chemicals/whitepaper.htm A detailed account of the hostile lobbying is at http://www.corporateeurope.org/lobbycracy/BulldozingREACH.html.

8. http://www.efsa.eu.int/about_efsa/catindex_en.html.

13 THE COMMON AGRICULTURAL POLICY AND COMMON FISHERIES POLICY

1. Consolidated Version of the European Union Treaties,Offi cial Journal C340, 10 November 1997, pp. 173–308.

2. The value of French farm land, for example, fell two-thirds during the last quarter of the twentieth century. See ‘Europe Goes Free Market, but Agriculture Remains Behind’, Wall Street Journal, 10 August 2000.

3. See ‘Over 3 Billion Euro in Farm Subsidies Misspent’, at http://www.euractiv.com/Article?tcmuri=tcm:29–129612–16&type=News.

4. See Chapter 15. 5. For a more detailed summary of the reforms, see European Parliament Fact

Sheet 4.1.2. The reforms of the CAP, http://www.europarl.eu.int/facts/4_1_2_en.htm; for a thorough analysis, see Organisation for Economic Cooperation and Development (OECD), Analysis of the 2003 CAP Reform, http://www.oecd.org/dataoecd/62/42/32039793.pdf; see also Food and Agriculture Policy Research Institute (FAPRI) Staff Report 2–03, Analysis of the 2003 CAP Reform Agreement, http://www.fapri.missouri.edu/outreach/publications/2003/FAPRI_Staff_Report_02_03.pdf.

6. Friends of the Earth Europe Press Release 15 October 2004, ‘CAP Cash Starts Rolling into New Europe – But with No Environmental Safeguards’, http://www.foeeurope.org/press/2004/MK_15_Oct_CAP.htm.

7. See, for example, Euractiv website ‘Africa Calls for Further Cuts of EU Farm Subsidies Ahead of WTO Talks’, http://www.euractiv.com/Article?tcmuri=tcm:29–112802–16&type=News – this website provides an excellent source of material on the CAP in general.

8. Countryside Alliance Press Release, ‘CAP Reform Still Not Enough’, http://www.countryside-alliance.org/news/03/030627cap.htm.

9. European Commission, ‘The Common Fisheries Policy’, http://europa.eu.int/comm/fi sheries/doc_et_publ/cfp_en.htm, and ‘Reforming the Common Fisheries Policy’, http://europa.eu.int/comm/fi sheries/reform/index_en.htm.

14 TRANSPORT

1. European Commission Transport Policy: Policy Guidelines of the White Paper, http://europa.eu.int/comm/energy_transport/library/orientations-lb-en.pdf.


Notes 199

2. See, for example, the Map of Activities on Transport in Europe (Amsterdam: A Seed Europe, 2000) – actually a map and booklet, which shows accomplished and planned transport-orientated building.

3. European Commission, Transport Policy: Policy Guidelines of the White Paper, http://europa.eu.int/comm/energy_transport/library/orientations-lb-en.pdf.

4. See European Commission, Rail Transport and Interoperability, http://europa.eu.int/comm/transport/rail/index_en.html.

5. See European Commission, The Single European Sky, http://europa.eu.int/comm/transport/air/single_sky/index_en.htm.

6. See European Commission, Maritime Transport, which contains details of some of these measures as well as links to recent safety legislation including the Regulation (EC) No. 1726/2003 of the European Parliament and of the Council of 22 July 2003 amending Regulation (EC) No. 417/2002 on the accelerated phasing-in of double-hull or equivalent design requirements for single-hull oil tankers, 01 October 2003.

7. See European Commission, Inland Waterway Transport, http://europa.eu.int/comm/transport/iw/overview/objectives_en.htm.

8. See European Commission, The Trans-European Transport Networks ‘TEN-T’, http://europa.eu.int/comm/ten/transport/index_en.htm; see also Friends of the Earth Europe Press Release 12 March 2004, ‘NGOs Call on Council to Follow European Parliament on Green Safeguards for TEN-t Projects’, http://www.foeeurope.org/press/2004/joint_12_March_NGOs.htm.

9. A tonne-kilometre is a normal unit representing the movement of one tonne of goods over a distance of one kilometre – so, for example, if you had to move three tonnes of apples 100 kilometres, this would represent 300 tonne-kilometres.

10. European Commission, The Marco Polo Programme, 2003–2010, http://europa.eu.int/comm/transport/marcopolo/index_en.htm.

11. European Commission, Galileo: A European Satellite Navigation System, http://europa.eu.int/comm/dgs/energy_transport/galileo/index_en.htm.

12. European Commission Directorate General for Transport and Energy, ‘Towards Sustainable Mobility’ at http://europa.eu.int/comm/transport/themes/mobility/english/sm_4_en.html.

15 REGIONAL POLICY

1. European Commission, Structural Policy Reform, http://europa.eu.int/scadplus/leg/en/lvb/l60013.htm.

2. Ibid. 3. Ibid. 4. Ibid. 5. Ibid. 6. Ibid. 7. European Commission Inforegio Fact Sheet, Cohesion Policy: The 2007

Watershed, http://europa.eu.int/comm/regional_policy/sources/docgener/informat/reg2007_en.pdf.



16 INDUSTRIAL POLICY AND ENERGY

1. White Paper, Growth, Competitiveness, and Employment: The Challenges and Ways Forward into the 21st century, COM(93) 700 fi nal, 5 December 1993, http://europa.eu.int/en/record/white/c93700/contents.html.

2. Available at http://europa.eu.int/comm/enterprise/enterprise_policy/industry/doc/com714_2002_en.pdf.

3. Available at http://aei.pitt.edu/archive/00001129/01/energy_white_paper_COM_95_682.pdf.

4. This Green Paper has several elements, all of which can be accessed via links from http://europa.eu.int/comm/energy_transport/en/lpi_lv_en1.html.

5. Communication from the Commission, Energy Infrastructure and Security of Supply, http://europa.eu.int/eur-lex/lex/LexUriServ/site/en/com/2003/com2003_0743en01.pdf.

17 THE REJECTION OF THE CONSTITUTIONAL TREATY: WHAT NEXT FOR THE EUROPEAN UNION?

1. The draft text can be read at http://european-convention.eu.int/docs/Treaty/cv00850.nl03.pdf.

2. See ‘Convention and Intergovernmental Conferences’ in Chapter 3 for details of its composition.

3. The IGC official website is at http://ue.eu.int/igc/index.asp?lang=NL&content=.

4. The text of the Charter as well as background and comments can be read at http://www.europarl.eu.int/charter/default_nl.htm.

5. Text of and information about the Treaty of Nice is at http://europa.eu.int/comm/nice_treaty/index_nl.htm.

6. For a report on French ‘No’ and background, see John Thornhill, Peggy Hollinger and Martin Arnold, ‘French No Vote Leaves EU Treaty in Chaos’, Financial Times, 30 May 2005; on Dutch vote, Emma Thomasson and Paul Gallagher, ‘Europe in Crisis after Dutch, French Reject Treaty’, Reuters Report, 1 June 2005; Kartika Liotard, MEP, ‘Press Statement on the Dutch NO Against the European Constitution’, www.sp.nl/international/.


Recommended Reading

1 INTRODUCTION

BooksTimothy Bainbridge, The Penguin Companion to the European Union, 3rd edition

(Penguin, 2003)Belen Balanya et al., Inc.: Regional and Global Restructuring and the Rise of

Corporate Power (Pluto Press, 2003)Elizabeth Bomberg and Alexander Stubb, The European Union: How Does It

Work? (Oxford University Press, 2003)Simon Bromley (ed.), Governing the European Union (Sage Publications/Open

University Press, 2001)David Calleo, Rethinking Europe’s future (Princeton University Press, 2001)Maria Green Cowles and Desmond Dinan (eds) Developments in the European

Union, (Palgrave Macmillan, 2004 )Paul Craig and Grainne de Burca, EU Law (Oxford University Press, 2002)Alan Dayton, Directory of European Union Political Parties (John Harper,

2000)Alan V. Deardoff (ed.), The Past, Present and Future of the European Union

(Palgrave Macmillan, 2004)Mary Farrell, Stefano Fella and Michael Newman, European Integration in the

21st Century: Unity in Diversity? (Sage Publications, 2002)Rodney Leach, Europe: A Concise Encylopaedia of the European Union from Aachen

to Zollverein (Profi le, 2000)Dick Leonard, The Economist to the European Union (Economist Books, 2002)Juliet Lodge, The 2004 Elections to the European Parliament (Palgrave Macmillan,

2005)David Phinnemore and Lee McGowan, Dictionary of the European Union

(Europa Publications, 2002)John Pinder, The European Union: A Very Short Introduction (Oxford University

Press, 2001)Andrés Rodrigues Pose, The European Union: Economy, Society, and Polity (Oxford

University Press, 2002)Dennis Swann, The Economics of Europe: From Common Market to European

Union, Ninth Edition (Penguin, 2000)A.G. Toth, Oxford Encyclopaedia of European Community Law (Oxford University

Press, Vol. I, 1991, Vol. II, 2005)Alex Warleigh, European Union: The Basics (Routledge, 2004)

WebsitesA collection of links to universities and private research organisations around

the world that participate in the study of the European Union is at http://www.indiana.edu/~unionet/academic.htm.

201



A comprehensive EU bibliography with links to other sites is provided at http://www.law.nyu.edu/library/foreign_intl/european.html.

http://www.cec.org.uk/. Most useful to students in the main not because of the information it contains, but because of its ‘bibliography’ (EU Information Sources in the UK and Links).

http://www.euro-know.org/dictionary/e.html A concise and irreverent, but nevertheless informative, encyclopaedia of the EU.

http://www.socio.ch/internat/geser1.htm Contains the essay ‘Why the EU Cannot Succeed’, as well as a very useful list of papers and other resources on European Union affairs, with hypertext links.

The latest European Parliament Fact Sheets, covering a wide range of EU-related matters, are at http://www.europarl.eu.int/facts/default_en.htm.

A range of material critical of the EU from a left perspective can be found on the website edited by the author at www.spectrezine.org.

The best daily source of EU-related news is www.euobserver.com.

2 THE TREATIES AND THE DEVELOPMENT OF THE COMMUNITY AND UNION

BooksPeter Coffey, The Future of Europe Revisited (Edward Elgar, 2003)Your Devust, The European Union at the Crossroads: The EU’s Institutional

Evolution from the Schuman Plan to the European Convention, 2nd edition (Peter Lang, 2003)

Desmond Dinan, Ever Closer Union: An Introduction to European Integration, 3rd edition (Lynne Rienner, 2005)

Per Gahrton, The New EU After Amsterdam (European Parliament Green Group, 1999)

David Galloway, The Treaty of Nice and Beyond: Realities and Illusions of Power in the EU (Sheffi eld University Press, 2001)

P. Lynch, N. Neuwahl and W. Rees, Reforming the European Union (Longman, 2000)

Karlheinz Neunreither and Antje Wiener, European Integration After Amsterdam (Oxford University Press, 2000)

Ben Rosamond, Theories of European Integration (Palgrave Macmillan, 2000)Larry Siedentop, Democracy in Europe (Penguin, 2000)Alexander Stubb, Negotiating fl exibility in the European Union: Amsterdam, Nice

and Beyond (Palgrave Macmillan, 2002)

WebsitesThe text of every Treaty pertaining to the EU and its predecessors can be

found at http://www.eurotreaties.com/.The offi cial ‘consolidated’ text – the Treaty of Rome as amended by all

subsequent treaties, and currently in force, is at http://europa.eu.int/eur-lex/en/treaties/dat/C_2002325EN.003301.html.

European Integration On-line Papers (EIOP) claims to be, and is, ‘the most comprehensive virtual library for EU research’ and can be accessed at http://eiop.or.at/. It contains numerous papers discussing the various treaties.


Recommended Reading 203

The BBC’s Euro-glossary at http://news.bbc.co.uk/1/hi/in_depth/europe/euro-glossary/default.stm contains a good summary of each important treaty as well as much else of value.

3 THE INSTITUTIONS

BooksRenaud Dehousse, The European Court of Justice (Macmillan, 1998)John Petersen and Michael Shackleton (eds) The Institutions of the European

Union (Oxford University Press, 2002)Philippa Sherrington, The Council of Ministers: Political Authority in the European

Union (Pinter, 2000)Bernard Steunenberg and Jacques Thomassen (eds), The European Parliament:

Moving Toward Democracy in the EU (Rowman & Littlefi eld, 2002)Paul van Buitenen, Blowing the Whistle (Politico’s Press, 2000)Rinus van Schendelen, Machiavelli in Brussels: The Art of Lobbying the EU

(Amsterdam University Press, 2002)

WebsitesYou can access all of the offi cial EU institutions and information services through a single gateway at http://europa.eu.int/index-en.htm

4 HOW THE EUROPEAN UNION MAKES LAW

BooksDaniel Guégen, A Practical Guide to the EU Labyrinth, 4th edition (Editions

Apogée: Collection Sésame Pour l’Europe, 2000)Erik Oddvar Eriksen and John Erik Fossum (eds), Democracy in the European

Union: Integration through Deliberation? (Routledge, 2000)

Websiteshttp://www.eurim.org/cassidy.htm contains the Eurim Guide to Decision-

Making in the European Union by ex-Conservative Euro-MP Bryan Cassidy.EUR-Lex, at http://europa.eu.int/eur-lex/en/index.html is designed to keep

you up to date on legislation in force in the European Union and new legislation as it is enacted.

The European Parliament’s On-Line Legislative Observatory, also known as ‘Oeil’, tracks legislative proposals as they move through the various stages of the process and is at http://www2.europarl.eu.int/oeil/index.jsp

5 ENLARGEMENT

BooksAlice H. Amsden et al., The Market Meets its Match: Restructuring the Economies

of Eastern Europe (Harvard University Press, 1998)



Laszlo Andor and Martin Summers, Market Failure: Eastern Europe’s ‘Economic Miracle’ (Pluto Press, 1998)

Fraser Cameron (ed.), The Future of the European Union: Integration and Enlargement, (Routledge, 2004)

Antoaneta L. Dimitrova (ed.), Driven to Change: The European Union Enlargement Viewed from the East (Manchester University Press, 2004)

Neill Nugent (ed.), European Union Enlargement (Palgrave Macmillan, 2004)Amy Verdun and Osvaldo Croci (eds), The European Union in the Wake of

Eastern Enlargement. Institutional and Policy-making Challenges (Manchester University Press, 2005)

WebsitesThe EU’s offi cial enlargement home page is at http://europa.eu.int/comm/

enlargement/index_en.html.http://www.euroguide.org/euroguide/subject-listing/enlargement.html

contains a variety of resources on enlargement.

6 THE COMMON FOREIGN AND SECURITY POLICY

BooksTerrence R. Guay, At Arms’ Length: The European Union and Europe’s Defence

Industry (St Martin’s Press, 1998)Vassiliki N. Koutrakou (ed.), Contemporary Issues and Debates in EU Policy: The

European Union and International Relations (Manchester University Press, 2004)

Hazel Smith, European Union Foreign Policy: What it Is and What it Does (Pluto Press, 2002)

Karen E. Smith, The Making of European Foreign Policy (Palgrave Macmillan, 2003)

WebsitesThe European Defence Industries Group has a website at http://www.edig.

org/.See also the site of the Centre for European Security and Disarmament at

http://www.cesd.org/.Somewhat out of date but still useful as background is Florika Fink-Hooijer,

‘The Common Foreign and Security Policy of the European Union’, European Journal of International Law, Vol.5, No.2, posted at http://www.ejil.org/journal/Vol5/No2/art2.html.

NATO’s take on the CFSP can be read at http://www.nato.int/docu/handbook/2001/hb150302.htm.

7 CITIZENSHIP, JUSTICE AND SECURITY

BooksJoanna Apap (ed.), Justice and Home Affairs in the EU: Liberty and Security Issues

after Enlargement (Edward Elgar, 2004)



Teresa Hayter, Open Borders: The Case Against Immigration Controls (Pluto Press, 2000)

Catherine Hiskyns and Michael Newman Democratising the European Union (Manchester University Press, 2000)

Andrew Geddes, Immigration and European Integration: Towards Fortress Europe? (Manchester University Press, 2000)

Andrew Geddes, The Politics of Migration and Immigration in Europe (Sage, 2003)

Karen Henderson (ed.), The Area of Freedom, Security and Justice in the Enlarged Europe (Palgrave Macmillan, 2005)

Gallya Lahav, Immigration and Politics in the New Europe: Reinventing Borders (Cambridge University Press, 2004)

WebsitesLinks to a range of material can be found at http://www.library.pitt.edu/

subject_guides/westeuropean/wwwes/jha1.guide.html.http://www.statewatch.org/‘Monitoring the State and Civil Liberties in the

European Union’. Updated daily.

8 MONETARY POLICY

BooksMichele Chang, Realigning Interests. Crisis and Credibility in European Monetary

Integration (Palgrave Macmillan, 2004)Peter Coffey, The Euro: An Essential Guide (Continuum, 2001)Kenneth Dyson, The Politics of the Euro-Zone: Stability or Breakdown (Oxford

University Press, 2000)Malcolm Levitt and Christopher Lord, Political Economy of Monetary Union

(Macmillan, 2000)Andrew Martin and George Ross, Monetary Integration and the European Model

of Society (Cambridge University Press, 2004)Bernard Moss (ed.), Monetary Union in Crisis: the European Union as Neo-liberal

Construction (Macmillan, 2005)James D. Savage, The Politics of Budgetary Surveillance and the Enforcement of

Maastricht (Oxford University Press, 2005)

WebsitesThe European Central Bank’s website is at http://www.ecb.int.Up-to-date offi cial information can be found at http://www.euro-information.

com/.Links to sites expressing a wide variety of views and offering comprehensive

information are at http://info.ex.ac.uk/~RDavies/arian/euro.html.

9 THE INTERNAL MARKET

BooksMichelle Egan, Constructing a European market: standards, regulation, and

governance. (Oxford University Press, 2001)



Bill Lucarelli, The Origins and Evolution of the Single Market in Europe (Ashgate, 1999)

Alan Philips and A.B. Philip, The Single European Market (Longman, 2000)A.G. Toth, Oxford Encyclopaedia of European Community Law: The Law of the

Internal Market (Oxford University Press, 2005)

WebsitesThe European Commission’s internal market website is at http://europa.

eu.int/comm/internal_market/en/index.htm.Links to various EU resources on its competition policy, including all relevant

legislative texts, are at http://europa.eu.int/pol/comp/index_en.htm.The European Union in the US offi cial magazine Europe has a special section

on competition policy. Go to http://www.eurunion.org/legislat/comweb.htm.

A list of consumers’ organisations internationally, including those concerned with the EU, with links to each is at http://www.vii.org/afi ca.htm.

The international trade union federation Public Service International produces critical analyses of EU proposals, including those bearing on competition policy, state aids, and the provision of essential services. Its website is at http://www.world-psi.org/.

10 EXTERNAL ECONOMIC RELATIONS

BooksVinod K. Aggarwal and Edward A. Fogarty (eds), EU Trade Strategies: Between

Regionalism and Globalism (Palgrave Macmillan, 2004)Amnesty International, Global Trade, Labour and Human Rights (AI, 2000)European Commission, Towards a More Coherent Global Economic Order (Kogan

Page, 1998)Nikolas V. Gianaris, The North American Free Trade Agreement and the European

Union (Praeger, 1998)

WebsitesOne of the best sources of general background reading on trade-related issues

and other aspects of international political economy is the website Global Issues That Affect Everyone at http://www.globalissues.org/index.html.

An example of a critique of EU development policy is provided by development NGO ‘CIDSE’ at http://www.cidse.org/pubs/euafpt2.htm: Towards True Partnership: EU-Africa Summit, A CIDSE Position Paper: European Union Development Policy (2000).

Oxfam UK’s website produces frequent critical reports on EU trade and development policies which can be found at http://www.oxfam.org.uk/index.htm.

11 EMPLOYMENT AND SOCIAL POLICY

BooksMatt Barnes et al., Poverty and social exclusion in Europe (Edward Elgar, 2003)



Jackie Brine, The European Social Fund and the EU (Routledge, 2001)Gerda Falkner, EU Social Policy in the 1990s: Towards a Corporatist Policy

Community (Routledge, 1998)Roberta Guerrina, Mothering the Union. Gender Politics in the EU (Manchester

University Press, 2005)Jozef Pacolet et al., Social Protection for Dependency in Old Age: A Study of the

Fifteen EU Member States and Norway (Ashgate, 2000)Ivor Roberts and Beverly Springer, Social Policy in the European Union: Between

Harmonization and National Autonomy (Lynne Rienner, 2001)

WebsitesThere is a wealth of useful material on the European Welfare States website

at http://www.pitt.edu/~heinisch/eusocial.html.The High Level Group’s report on the European Employment Strategy is at

http://europa.eu.int/growthandjobs/pdf/kok_report_en.pdf.

12 ENVIRONMENT AND PUBLIC HEALTH

BooksLiliana B. Andonova, Transnational Politics of the Environment: The European

Union and Environmental Policy in Central and Eastern Europe (Dimiter D. Toshkov/MIT Press, 2003)

Wyn Grant, Duncan Matthews and Peter Newell, The Effectiveness of European Union Environmental Policy (St Martin’s Press, 2000)

Tim Jeppesen, Environmental Regulation in a Federal System: Framing Environmental Policy in the European Union (Edward Elgar, 2002)

Andrew Jordan and Duncan Liefferink (eds) Environmental Policy in Europe: The Europeanization of National Environmental Policy (Routledge, 2004)

Christopher Knill and Andrea Lenschow, Implementing European Union Environmental Policy: New Directions and Old Problems (Manchester University Press, 2000)

John McCormick, Environmental Policy in the European Union (Palgrave Macmillan, 2001)

Rudiger K.W. Wurzel, Environmental Policy-making in Britain, Germany and the European Union (Manchester University Press, 2002)

WebsitesAbout.com’s ‘Environmental Issues’ site gives a great deal of straightforward

information about EU environmental policies at http://environment.about.com/newsissues/environment/library/weekly/bleur.htm.

The offi cial European Environment Agency can be found at http://www.eea.eu.int/.

Not to be confused with the European Environment Bureau, which represents NGOs and is at http://www.eeb.org.

The ‘European Union in the US’ website has links to useful information through its environment page at http://www.eurunion.org/legislat/envirweb.htm.



The European Parliament Committee for the Environment, Public Health and Food Safety can be found at http://www.europarl.eu.int/comparl/envi/default_en.htm.

Friends of the Earth Europe produces critical comments on EU environmental initiatives and is at http://www.foeeurope.org/.

http://www.mem.dk/aarhus-conference/newslet/articels/eurounio.htm gives an offi cial view of the environmental implications of enlargement.

13 THE COMMON AGRICULTURAL POLICY AND COMMON FISHERIES POLICY

BooksRobert Ackrill, The Common Agricultural Policy (Sheffi eld Academic Press,

2001)Alan Greer, Agricultural Policy in Europe (Manchester University Press, 2005)Christian Lequesne, The Politics of Fisheries in the European Union (Palgrave

Macmillan, 2004)

WebsitesA lively blog on the CAP is Wyn Grant’s Common Agricultural Policy Page at

http://members.tripod.com/~WynGrant/WynGrantCAPpage.html.International Institute for Sustainable Development, The Reform of the European

Union Common Agricultural Policy, http://iisd1.iisd.ca/greenbud/reform.htm.

The Commission produces a magazine Fishing in Europe, available on-line at http://europa.eu.int/comm/fi sheries/doc_et_publ/magaz/fi shing_en.htm.

Easily the most entertaining website on the CFP is ‘Save Britain’s Fish’, http://www.savebritfi sh.org.uk/index.htm.

14 TRANSPORT

BooksJonas Akerman et al. (eds) European Transport Policy and Sustainable Mobility

(Routledge, 2000)Handley Stevens, Transport Policy in the European Union (Palgrave Macmillan,

2004)Stijn Vanhandsaeme et al. (eds), Lost in Concrete: Activist Guide to European

Transport Policies (A SEED Europe, 1996)John Whitelegg, Critical Mass: Transport, Environment and Society in the Twenty-

fi rst Century (Pluto Press, 1997)Winfried Wolf, Car Mania: A Critical History of Transport (Pluto Press, 1996)

WebsitesGo to http://europa.eu.int/comm/transport/site_map_en.html to navigate

around the whole of Directorate-General Transport’s site.



A collection of offi cial EU publications can be found at the site of the Cordis ‘Research into Sustainable Mobility’ website at http://www.cordis.lu/transport/src/public1.htm.

A good bibliography on European transport, with links is on a Nottingham University website at http://www.nottingham.ac.uk/sbe/planbiblios/bibs/sustrav/refs/ST36.html.

The European Spacial Planning Observation Network, which is sponsored by the Community Instrument Inter-reg II, has produced a report entitled Territorial Impact of EU Transport and TEN Policies, which is available at http://www.espon.lu/online/documentation/projects/policy_impact/111/tor_2.1.1.pdf.

15 REGIONAL POLICY

BooksJ.F. Bachtler and Ivan Turok (eds), The Coherence of EU Regional Policy:

Contrasting Perspectives on the Structural Funds (Routledge, 1999)Paul Balchin et al., Regional Policy and Planning in Europe (Routledge, 1999)

WebsitesEuropean Union Regional and Structural Policy is covered at http://www.

library.pitt.edu/subject_guides/westeuropean/wwwes/regions.guide.html.

Regional policy is looked at from a business perspective at http://www.eubusiness.com/guides/regional.

Bernard Herz, Real Convergence and Regional Policy in the European Union: Evidence from 1990s, http://ideas.repec.org/p/uba/hadfwe/con_2002–11.html.

An offi cial EU monthly periodical, Inforegio News, can be found at http://europa.eu.int/comm/regional_policy/newsroom/archiv_en.htm, while a quarterly, Inforegio Panorama, is at http://europa.eu.int/comm/regional_policy/sources/docgener/panora_en.htm.

O. Guersent, The Regional Policy of the European Union: A Balance and an Outlook (2001) is available at http://www.ingentaconnect.com/content/carfax/cres/2001/00000035/00000002/art00007.

16 INDUSTRIAL POLICY AND ENERGY

BooksWerner Bonefeld (ed.), The Politics of Europe. Monetary Union and Class (Palgrave

Macmillan, 2001)Yannis Caloghirou et al., European Collaboration in Research and Development:

Business Strategy and Public Policy (Edward Elgar, 2004)Peter Johnson (ed.), Industries in Europe: Competition, Trends, and Policy Issues

(Edward Elgar, 2003)Thomas C. Lawton, European Industrial Policy and Competitiveness: Concepts

and Instruments (St Martin’s Press, 1998)



Joao Maria Rodrigues, The New Knowledge Economy in Europe. A Strategy for International Competitiveness and Social Cohesion (Edward Elgar, 2003)

Joao Maria Rodrigues, European Policies for a Knowledge Economy (Edward Elgar, 2004)

Wolf Sauter, Competition Law and Industrial Policy in the EU (Oxford University Press, 1998)

WebsitesThe website of the European Commission Directorate-General for Energy is

at http://europa.eu.int/comm/dgs/energy_transport/index_en.html.The website of the Directorate-General for Research is at http://europa.eu.int/

comm/dgs/research/index_en.html.The most valuable site for research information, however, is the Community

Research and Development Information Service (CORDIS) at http://www.cordis.lu/en/home.html.

17 THE REJECTION OF THE CONSTITUTIONAL TREATY: WHAT NEXT FOR THE EUROPEAN UNION?

BooksLynn Dobson and Andreas Follesdal (eds), Political Theory and the European

Constitution (New York: Routledge, 2004)Peter Norman, The Accidental Constitution: The Story of the European Convention

(Gazelle, 2003)Jonas Sjöstedt, The New EU Constitution: Centralised Rule and Market Liberalism

(GUE/NGL, 2005)

WebsitesThe full text of the Constitutional Treaty is available at http://europa.eu.int/

eur-lex/lex/JOHtml.do?uri=OJ:C:2004:310:SOM:EN:HTML.See also http://www.spectrezine.org/europe/Constitution2.htmand http://www.vote-no.com/home/home.aspx and the papers presented at the 2004 ‘Maastricht Forum’ on ‘European

Integration: Making the Constitution Work’ which was held at European Institute of Public Administration, Maastricht, on 19 November 2004, available at http://www.eipa.nl/default.htm.


ACP (Africa, Caribbean, Pacifi c) group 93, 96

Action Plan for Skills and Mobility 70Advocates-General 29Afforestation programmes 121Agenda 2000 39–40, 125, 151–2Agreement on Social Policy (ASP)

110–11agriculture see Common Agricultural

PolicyAlgeria 97Amnesty International 63Amsterdam, demonstrations 58–9Amsterdam Treaty 6, 9–12 and citizenship 58 and civil rights 10 and Common Foreign and

Security Policy (CFSP) 52, 53, 54 and consumer protection 89 and disability 115 and discrimination 59, 115 and education and training 116 and environmental policy 120,

121–2 European Community Treaty 59 and European Parliament 26, 63 and fundamental rights and

freedoms 59 Intergovernmental Conference 17 and Justice and Home Affairs 62 and language rights 58 and national parliaments 63animals, health and welfare of 135,

136‘anti-European’ 1Antilles 175armaments industry 52–3, 184assent procedure 34, 37Association Agreements 97Association of South East Asian

Nations (ASEAN) 97asylum policy 66–7Austria 19, 26, 27, 43, 52, 71, 73, 84,

151Azores 151

Balkan wars 46–7, 51, 53, 95

Balkenende, Jan Peter 176Bangemann, Martin 53Barroso, Jose 24Belgium 26, 27, 39, 64, 73, 85, 96,

160Berlin Summit of 1999 46, 134Berlusconi, Silvio 176biofuels 136biometrics 65biotechnology 88, 126, 127, 160Blair, Tony 169, 176Bolkestein, Frits 86, 87Bologna Declaration on the

European Dimension for Higher Education (1999) 117

border controls 66, 175Bosnia 51Britain see United KingdomBritish Broadcasting Corporation

(BBC) 1–2BSE crisis 80, 90, 120, 183budget 38–42 budgetary authority 40–2 budgetary procedure 34, 40–2 and Common Agricultural Policy

135, 139 and Common Fisheries Policy 39 compulsory and non-compulsory

expenditure 39 and Constitutional Treaty 169 disputes between member states

over 169, 175 European Commission role in

establishing 21–2, 40–2 European Parliament role in

establishing 26, 40–2, 164 and structural funds 40, 150, 151,

154 United Kingdom annual rebate 38Bulgaria 20, 26, 43, 49, 149Bush, George W. 64, 169Buttiglione, Rocco 24

Canary Islands 151capital, free movement of 82–3car industry 80, 90Carson, Rachel 119

211

Index

McGiffen 03 index 211McGiffen 03 index 211 30/8/05 09:44:4630/8/05 09:44:46


Cartagena Convention on Biosafety 126

Cassis de Dijon case (1979) 77catalytic converters 80CEEP, (EU-wide small businesses’

group) 112Charter of Fundamental Rights 60–1 and Constitutional Treaty 166, 172chemicals, control of 127–8child benefi ts and family allowances

81children and dependency ratio 116 offences against 11Christianity 166, 170, 181Citizenship 7, 57–65 and Amsterdam Treaty 57–9 and Constitutional Treaty 166 and Maastricht Treaty 9civil rights 10Clean Development Mechanism 124climate change 119, 123–6 and energy policy 158 and transport 141co-decision procedure 26, 33–7 in Amsterdam Treaty 12 in Constitutional Treaty 164 and environmental policy 120Cohesion Fund 9, 150, 151, 152–3 and TENs 84Cohesion policy 32, 152–3 and Agenda 2000 151 and Constitutional Treaty 174–5 European Commission ‘factsheet’

Cohesion Policy: the 2007 Watershed 157

and Lisbon Agenda 100, 103, 107 in Nice Treaty 13 in Single European Act 8 see also regional policyComenius (EU education

programme) 116Committee of the Regions (CoR) 31Common Agricultural Policy (CAP)

132–6, 139 and budget 39, 40, 134, 135 and environmental policy 119–20,

135, 136, 177 European Agricultural Guidance

and Guarantee Fund 133, 150, 153

and export subsidies 94, 133–4 and external trade 92, 93, 94, 95 and protectionism 95Common Customs Tariff (CCT) 92,

94Common Fisheries Policy (CFP)

136–8, 139–40 Community Action Plans 138 Community Fisheries Control

Agency (CFCA) 138 and environmental policy 121 Financial Instrument for Fisheries

Guidance 150, 153 Joint Inspection Structure 138 Regional Advisory Councils 138Common Foreign and Security Policy

(CFSP) 51–6 Battle Groups 55 Common Strategy 54 and Constitutional Treaty 163,

165–6, 170 Headline Goal 2000 54 High Representative for 51–2, 54,

163, 164 Petersburg tasks 53 Planning and Early Warning Unit

54 Political and Security Committee

(PSC) 54, 55 Western European Union (WEU)

52, 53, 54Common Market Organisations

(CMOs) 133Common Security and Defence

Policy see Common Foreign and Security Policy

Common Transport Policy (CTP) 141, 142–5

see also transportCommunity Charter of the

Fundamental Social Rights of Workers 59

Community information and consultation procedure 94

Community Instruments (CIs) 113, 115, 117, 152, 153

Community Preference 133competition policy 35, 77–9, 90, 123 and industrial policy 155 and public ownership 84 and transport 141


Index 213

conciliation procedure 35–6Conservatives, British 27, 111Constitution/Constitutional Treaty

2, 3, 8, 17–19, 61, 162–78, 180 Declarations and Protocols

relating to individual member states 175

and enlargement 44 and European Commission 170 and European Parliament 26, 170 and ‘European President’ 170 initial rejection by member state

governments 169 rejection of in French and Dutch

referenda 8, 162, 175–7 Spanish referendum on 175consultation procedure 33, 34, 37consumer protection 7, 30, 32,

89–91, 106 and air transport 144 in Amsterdam Treaty 12 in Charter of Fundamental Social

Rights 60 and Common Agricultural Policy

132 and Common Fisheries Policy 137,

138, 140 Consumer Action Programme

(1975) 89 Consumer Protection in the European

Union: Ten Basic Principles 91 Economic and Social Committee

(ECOSOC), representation in 31 and energy policy 84, 158, 159 and food safety 130 and genetically modifi ed

organisms (GMOs) 127, 128 and internal market 76, 77, 85 and lobbying 80 ‘Priorities for Consumer Policy

1996–98’ (Action Plan) 90 and public health 128Convention 18–19, 162, 171Convention for the Protection of

Human Rights and Fundamental Freedoms (commonly known as the European Convention on Human Rights) see Council of Europe

co-operation procedure 33, 36Copenhagen Criteria 47

COREPER (Committee of Member States’ Permanent Representatives) 17

Council of Europe European Convention on Human

Rights 59, 60 European Social Charter 59Council of Ministers 15–17, 182 Agriculture Council 133 in Amsterdam Treaty 10, 52 and ‘area of freedom, security and

justice’ 62, 65 and budgetary procedure 40–1,

174 and chemicals policy (REACH) 128 and Committee of the Regions 31 and Common Fisheries Policy 137,

138 and Common Foreign and

Security Policy 52, 54, 55 Common Position 34 and Constitutional Treaty 164,

167, 172–3 Declarations of 33 and disability 115 Economic and Financial Affairs

Council (ECOFIN) 75 and Economic and Monetary

Union 22, 74, 75, 173 and Economic and Social

Committee (ECOSOC) 31 and energy policy 158 and environmental policy 119,

128 and European Central Bank 75 and European Commission 20, 21,

22 Euro Council 75, 173 and European Court of Justice 30 and European Parliament 21, 25,

26 and external trade 22, 92, 94 Fisheries Council 138 Foreign Affairs Council 163 General Affairs Council 16, 55 and genetically modifi ed

organisms (GMOs) 126 and health and safety at work 108 and legislative procedure 33, 34–8 and Lisbon Agenda 100 in Maastricht Treaty 9 in Nice Treaty 11, 55



Council of Ministers continued and Port Services, proposed

Directive on 144 Presidency 16 Qualifi ed Majority Voting in 33–4,

35 Recommendations of 33 Requirement for unanimity in

33–4 and Services in the Internal

Market, proposed Directive on 129

in Single European Act 8 and state aids 78 and TENs 145 and workers’ rights to information

and consultation 111Country of Origin Principle, see

Services in the Internal Market, proposed Directive on (2005)

Countryside Alliance 136crime 6, 11, 62, 63, 66, 99, 103, 165Croatia 43, 47, 49, 51, 93customs co-operation 10, 62 and crime 11 duties and tariffs 39, 76, 92customs union 5, 92Cyprus 26, 27, 44, 45Czech Republic 26, 27, 44

dangerous products 90, 128data protection 65, 66‘Decisions’ 32‘Declarations’ 32defence see Common Foreign and

Security Policydelocalisation of production 86, 95,

107democracy 25, 28, 177, 183, 187 and Common Foreign and

Security Policy 56 and Economic and Monetary

Union 185–6 and enlargement 47 and Qualifi ed Majority Voting

(QMV) 165Denmark 11, 26, 27, 39, 43, 68, 70,

98, 153deregulation 95 and Constitutional Treaty 176

of labour markets 88, 102, 103, 104 of transport 143, 144development 39, 56, 96–8, 134, 155,

160, 186dioxins 90, 120diplomatic representation, right of

EU citizens to 57‘Directives’ 32, 34disability 10, 59, 114–15, 143discrimination 7, 10, 12, 59, 101,

107, 112, 114, 115, 153drugs, illegal 6, 11, 62, 109Dublin Convention of 1988 64

e-coli 90Economic and Financial Committee

75Economic and Monetary Union

(EMU) 65–75 and European Commission 22 origins in Maastricht Treaty 5, 9 and regional policy 150 and social spending 102 see also EuroEconomic and Social Committee

(ECOSOC or ESC) 31, 179ECU (European Currency Unit) 72education 116–17Egypt 97elderly people 115–16emissions trading see Kyoto Protocolemployment 7, 99–118, 177, 186 and Amsterdam Treaty 9, 10 and Constitutional Treaty 173,

175 and disability 114–15 and enlargement 47 and euro 68 and European Social Fund 117–18 and freedom of movement 81 and internal market 77, 88 and Lisbon Agenda 100, 101,

102–9, 115, 156 of older people 105, 115–16 and Structural Funds 150–2, 154 of women 105, 109, 112–13Employment Guidelines 99, 100,

101, 113energy policy 157–9 and TENs 84 and Constitutional Treaty 175


Index 215

Enhanced Co-operation 174enlargement 43–50 of 2004 19, 43–50, 162 of 2007 (projected) 20 and Cohesion Fund 153 and Common Agricultural Policy

45, 135, 171 and Common Foreign and

Security Policy (CFSP) 56 and Constitutional Treaty 170,

171 and environmental policy 146 and European Parliament 24, 26 and industrial policy 156 and regional policy 45, 149, 154 and research and development

157 and restriction of right to freedom

of movement 46, 48–9, 82, 171 and TENs 146 and transport 142Environmental Action Programmes

(EAPs) 119, 123Environmental Impact Assessment

(EIA) 121environmental policy 119–28 in Amsterdam Treaty 6, 12, 89 and Common Agricultural Policy

135, 136, 139, 177 and Common Fisheries Policy 138 and Constitutional Treaty 164,

176 and consumer policy 89, 90 and Council of Ministers 16 and Economic and Social

Committee 31 and energy policy 158 and enlargement 43, 150 environmental economic

strategies as source of growth 106

and European Court of Justice 30 and internal market 76, 77, 80, 85,

86, 93, 156 and liberalisation 158 and Lisbon Agenda 103, 106 and lobbying 80 in Maastricht Treaty 9 mainstreaming of 143 in Nice Treaty 7 and regional policy 150

and research and development 159

and Services in the Internal Market, proposed Directive on 87

in Single European Act 4, 8 and Structural Funds 150, 152 and TENs 83, 84 and transport 83, 121, 141, 142,

143, 146Equal (Community Instrument to

combat discrimination) 153equal opportunities 59, 101, 109,

112–14 and Amsterdam Treaty 10 Community Framework Strategy

on gender equality 113 and Structural Funds 113, 118, 150Erasmus, (EU university education

programme) 116Estonia 26, 27, 44Euro see Economic and Monetary

UnionEurojust 172‘Europe’ as short-hand for European

Union 1European Agricultural Guidance and

Guarantee Fund (EAGGF) see Common Agricultural Policy

European Atomic Energy Community (Eurotom) 157

European Aviation Safety Agency (EASA) 144

European Bank for Reconstruction and Development (EBRD) 46

European Central Bank (ECB) 74–5, 168

European Coal and Steel Community (ECSC) 17, 157, 159

European Commission 19–25 and Amsterdam Treaty 10 and budgetary procedure 40, 41 and Common Foreign and

Security Policy (CFSP) 54 Communications of 33 and competition policy 22, 78–9 and Constitutional Treaty 19, 163,

164, 168, 172 and consumer policy 91 and Convention 18 and discrimination 59



European Commission continued and European Central Bank 75 and European Council 14, 15 and European Court of Justice 29,

30, 32 and external trade 22, 92, 93, 94,

96, 97 Green Papers 34 and legislative procedure 33–8 and Maastricht Treaty 9 and Nice Treaty 7, 12, 13 Recommendations of 33 Social Agenda for 2005–10 100 and state aids 77 Tobin Tax, view of 83 and transport policy 83 White Papers 34European Community (EC) 1European Community Treaty, see

Amsterdam TreatyEuropean Convention on Human

Rights (ECHR), see Council of Europe

European Council 14–15 and Amsterdam Treaty 10 Cologne Summit 1999 60 and Common Foreign and

Security Policy (CFSP) 53, 54 and Constitutional Treaty 8, 163,

164, 167, 170, 172, 173 Copenhagen Summit of 1993 45,

46 Declarations of 33 and European Monetary Union

73, 74 Lisbon Agenda 100 Lisbon Summit 2000 100 Luxembourg Summit 1998 100 and Maastricht Treaty 9 and Nice Treaty 13, 55 and Single European Act 8 Stockholm Summit 2001 100 Thessalonika Summit 2003 162European Court of Auditors 30–1, 42European Court of First Instance 29European Court of Human Rights 30European Court of Justice (ECJ) 15,

22, 29–30, 33, 182 and civil liberties 62 and Constitutional Treaty 166 and discrimination 59, 113

and internal market 77, 86 and Maastricht Treaty 9European Data Protection Supervisor

66European Defence Agency 55European Disability Forum 115European Economic Area (EEA)

49–50, 85European Economic Community

(EEC) 157, 180European Employment Strategy 99,

100, 113 Joint Employment Report of

Commission and Council 99, 100

National Action Plans 99, 100European Environmental Bureau 120European Food Safety Authority

130–1European Foreign Minister 163, 164,

172European Foundation for the

Improvement of Living and Working Conditions 48

European Free Trade Area (EFTA) 49, 85

European Investment Bank (EIB) 46, 84, 107

European Investment Fund 84European Monetary Union see

Economic and Monetary UnionEuropean nationalism 179–80European Parliament (EP) 15, 16,

25–9 and budget 38 Committee on Budgetary Control

42 and Common Foreign and

Security Policy (CFSP) 54 and Constitutional Treaty 163,

164, 172 corporate lobbying of 29 election of 24, 26, 49 and enlargement 44 and environmental policy 120 and human rights 33, 38 informal consultations 36–7 and legislative procedure 33–8 monitoring expenditure 42 and nomination of European

Commission 23–5


Index 217

Political Groups 35, 36, 37, 144 powers of 22–3 Rapporteurs 36 ‘readings’ 35–8 rejects proposed Directive on

Market Access to Port Services 144–5

representation in 26, 27–8 resolutions of 33 Shadow Rapporteurs 36 and TENs 146European Political Parties 28–9European Prosecutor 165European Regional Development

Fund (ERDF) 150, 152European Research Area 160European Research Council, proposal

for 106European Social Action Investment

Plan, proposal for 107European Social Charter (1961) 59European Social Fund (ESF) 117–18,

150European System of Central Banks

(ESCB) 75European Trade Union

Confederation (ETUC) 107European Union (EU) 1, 2–3, 14 citizenship of 57 and democracy 182–6 extradition and judicial co-

operation, agreement with US on 65

history and development of 180–1 and legal personality 167 militarisation, see Common

Foreign and Security Policy right of member states to secede

from 167European Works’ Councils 112Europol (EU police force) 62, 63 agreement with US 65‘euro-sceptics’ 1, 26

Farage, Nigel 28federalism 166–7Financial Instrument for Fisheries

Guidance (FIFG) 150Finland 19, 26, 27, 43, 52, 70, 73, 151fi scal policy 167–8food safety 130–1, 135

foreign policy, see Common Foreign and Security Policy (CFSP)

‘Four Freedoms’ 80France 8, 18, 19, 26, 27, 51, 64, 70, 73,

74, 162, 166, 168, 169, 170, 175freedom of movement 57, 80, 81,

170–1Friends of the Earth 136

Galileo (satellite-based radio navigation system) 146

General Agreement on Tariffs and Trade (GATT) 94, 135

General Agreement on Trade in Services (GATS) 97

Generalised System of Preferences (GSP) 134

General Product Safety Directive (1992) 90

genetically-modifi ed organisms (GMOs) 120, 126–7, 131

Geneva Convention on Refugees 63, 67

Germany 19, 26, 27, 44, 47, 51, 64, 70, 71, 73, 74, 77, 98, 160, 168, 169, 170

Giscard d’Estaing, Valery 18–19, 162, 166

globalisation 95–6, 107Great Britain see United KingdomGreece 26, 27, 43, 64, 149, 150, 152greenhouse gases 124, 125Green Papers, see European

CommissionGreen parties 119Gross Domestic Product (GDP),

limitations of as measure of real economic success 99

Growth and Stability Pact 70, 71, 95, 103, 104, 107, 169

Grundtvig (EU adult education programme) 117

health and safety at work 86, 107–10 Action Programmes 108–9 Commission Communication

Adapting to change in work and society: A New Community Strategy on Health and Safety at Work, 2002–2006 109–10

Framework Directive (1989) 108 and women 109, 112



health policy, see public healthHelios (EU network for disabled

people) 115Helsinki Final Act 56holidays, paid 99Horizon (unemployment initiative)

115humanitarian aid 97human rights and Amsterdam Treaty 10, 59 and Charter of Fundamental

Rights 60, 166 and Common Foreign and

Security Policy 56 and enlargement 47 and European Parliament 33, 38 and Maastricht Treaty 97 and terrorism 64 of women 114Hungary 26, 27, 44, 49

Iceland 49, 50, 83IMF (International Monetary Fund)

182, 187immigration 63industrial policy 155–7information and communications

technology (ICT) 105Intergovernmental Conferences

(IGCs) 17–19, 162, 165internal market see Single European

Market (SEM)International Criminal Court 47International Labour Organisation

(ILO) 60Inter-reg III (Community

Instrument) 153Iraq 64, 168Ireland 26, 27, 43, 45, 48, 52, 64, 65,

73, 149, 150, 165, 170, 175, 186Israel 38Italy 19, 24, 26, 27, 64, 73, 90

Joint Employment Report 100Joint Research Center (JRC) 160Jordan 97judicial co-operation 62Justice and Home Affairs (JHA) 62–7 and Maastricht Treaty 5, 9

Kohl, Helmut 69

Kok, Wim 103, 104Kosovo 51, 53Kyoto Protocol 123–6

labour costs 102labour markets direct intervention 99, 100 labour mobility 70, 81–2 participation rate of older workers

in 99, 105 participation rate of women in

105 reform of 99, 100, 101, 102, 106 see also employment; European

Employment Strategy, Lisbon Agenda

Latvia 26, 27, 44, 45Leader + (Community Instrument for

poorer rural regions) 153Lebanon 97Leonardo da Vinci (EU training and

education programme) 117liberalisation of capital movements 83 and Constitutional Treaty 176 of energy supply 158–9 and Lisbon Strategy 103 of transport 141, 143 of world trade 95Lichtenstein 49, 85Lingua (EU language education

programme) 117Lisbon Agenda/Programme/Strategy

88, 99, 102–7, 156 and ‘competitiveness’ 99, 102, 103 and ‘convergence’ 100 and education 105 and enlargement 105 and ‘European social model’ 103,

104, 105 European Trade Union

Confederation (ETUC), criticisms of by 107

and health and safety at work 109 and ‘knowledge-based society’ 103 and regional policy 154 Report of the High-Level Group of

Independent Experts, Facing the Challenge 103–7

and Research and Development 105, 106


Index 219

Lithuania 26, 27, 44lobbying 29, 79, 80, 120, 126, 128,

155, 179, 183Lomé Convention 96, 97, 134London bombings of 2005 146Luxembourg 26, 27, 73, 98Luxembourg Process, see European

Employment Strategy

Maastricht Treaty (Treaty on European Union) 4–6, 8–9

and citizenship 57 and co-decision 26 and Common Foreign and

Security Policy 51–2, 54 and development policy 96–7 and education and training 116 and environmental policy 120,

123 and health 128 and Justice and Home Affairs 62 and regional policy 150 and research and development

160 three pillar structure 5, 54, 62McCreevy, Charlie 87McKenna, Patricia 6Madariaga, Javier Solana 52Madeira 151Madrid bombing of 2004 64‘mainstreaming’ 121,143, 155, 157Malta 26, 27, 73, 98Marco Polo (transport programme)

146media, British 1–2Mercosur (Latin American economic

community) 97Millennium Development Goals

(MDGs) 97Miners’ Strike (1984–85) 111Minerva (EU open and distance

learning programme) 117Morocco 97Multi-annual Financial Framework

174multinational corporations (MNCs) political power of 182–3

NAFTA (North American Free Trade Agreement) 182

nationalism 179–80

NATO (North Atlantic Treaty Organisation) 52, 53, 54, 170, 187

nature conservation 97Netherlands 8, 26, 27, 70, 73, 86, 96,

98, 103, 160, 162, 175Nice, Treaty of 6–8, 12–13, 162 and Committee of the Regions 31 and Common Foreign and

Security Policy (CFSP) 55–6 and Economic and Social

Committee 31 European Council meetings 14 and European Political Parties

28–9 Intergovernmental conference 17 and Qualifi ed Majority Voting

(QMV) 6, 7, 168–9Northern Ireland Peace Initiative 153Norway 49, 85, 180NOW, New Opportunities for

Women 113nuclear energy 46, 125, 157, 158,

159

oil 85, 158Ombudsman 26, 58open method of co-ordination

99–100‘Opinions’ of the Economic and Social

Committee 31 of the European Parliament 33

patents Community Patent 88, 106–7 on software 106Palestine 64parental leave 112Paris Charter 56part-time work 112peacekeeping 10, 53pensions aggregation 81 competence 115Petersberg tasks 10, 53petition, right of 58PHARE (Poland–Hungary Assistance

in Restructuring their Economies) 46

Poland 26, 27, 44, 166, 168, 169, 170



police 9, 10, 11, 58, 59, 62, 63, 65, 66, 67

Political Cooperation 51Political Parties at European Level,

see European Political PartiesPolitical and Security Committee

(PSC), see Common Foreign and Security Policy (CFSP)

pollution 80, 119, 120, 125, 126, 141, 142, 145, 147, 158

Portugal 26, 27, 43, 45, 71, 73, 74, 149, 150, 169

postal services 85poverty 39, 45, 97, 98, 101, 103, 114,

149, 156privacy 65privatisation 95, 176, 181productivity 100, 104 agricultural 132 in EU compared to US and Japan

157 and Lisbon Agenda 106 in new member states 105‘pro-European’ 1professional qualifi cations,

recognition of 88–9proportionality 6, 167protectionism 30, 95, 186‘provisional twelfths’ 41public health 128–30 and the Common Agricultural

Policy 136 DG Sanco 128public ownership 84, 96public–private partnerships 106public procurement 106, 107pure beer law (German) 77

Quakers 63Qualifi ed Majority Voting (QMV)

33–4 and Amsterdam Treaty 10 and Common Foreign and

Security Policy 54, 170 and Constitutional Treaty 163,

164–5, 166, 170, 172–3 and democracy 33–4 ‘double qualifi ed majority’ 165,

168 and environmental policy 122–3 and health and safety at work 108

and Maastricht Treaty 9 and Nice Treaty 6, 7, 12, 55 and Single European Act 8 weighting of votes per member

state 168

racism 11, 63, 67REACH 127–8Readmission agreements 67‘Recommendations’ 33Redundancy 111refugees 66–7refunds, to member states 39regional policy 149–54 and Constitutional Treaty 174–5 and poverty and social exclusion

149 see also European Regional

Development Fund; Cohesion Fund; Structural Funds

‘Regulations’ 32, 34Renault, factory closure 111renewable energy 158–9Research and Development (R&D)

104, 156, 157, 159–61 Sixth Framework Programme for

(2003–06) 160 spending on 161residence, right of 11, 57resident non-EU nationals, rights of

63right to demonstrate, restriction of

by EU measure 66risk capital, availability of 106Romania 20, 26, 27, 43, 49, 149rural development 135

SAFE (Safety Actions for Europe) Safety Actions for Europe 108

salmonella 90Santer, Jacques 23Schengen system 11, 62, 65self-employed, rights of 49, 57, 82,

112services essential, proposed Directive on

129 fi nancial 105, 106, 107 freedom to provide 86 free movement of 86, 104, 107


Index 221

promotion of competition among 106

shift from manufacturing towards 156–7

Services in the Internal Market, proposed Directive on (2005) 86, 89, 96

and health care 129–30single currency see EuroSingle European Act (SEA) 4, 8, 79 and barriers to trade 4, 79 and co-decision 26 and common foreign and defence

policy 4 and environmental policy 4 and frontier controls 57 and internal market 4 and regional policy 149 and research and development 4,

159 and social policy 4Single European Market (SEM)

76–91, 104 Action Plan for (1997) 88 and employment 80, 105 and environment 80, 150 and industrial policy 156 and regional disparities 149 and restructuring of industry 150 and transport policy 141–6 transposition of internal market

measures by member states 105 White Paper on completing the

internal market, 1985 76 see also services‘Single European Sky’ 144single programming document 150Sjöstedt, Jonas 83Slovakia 26, 27, 44, 49Slovenia 26, 27, 44, 45Small and Medium-Sized Enterprises

(SMEs) 106social dumping 87, 107, 108social exclusion 100Solana, Javier 52, 163sovereignty 5, 44, 49, 174Spain 19, 26, 27, 43, 45, 64, 73, 149,

150, 160, 168, 169, 170, 175state aids 77–8, 88, 93, 94, 100, 107 and transport 141

Structural Adjustment Programme (SAP) 95

Structural Funds 150–4 and environment 120–1 and equal opportunities 113, 150 see also Agenda 2000; Cohesion

Fund; European Regional Development Fund; European Social Fund

subsidiarity 6, 9, 166–7subsidies 22, 93, 169 agricultural 96, 121, 133, 134, 135,

136, 171 fi sheries 137, 138Sweden 19, 26, 27, 43, 48, 52, 68, 98,

151, 153, 177Swedish Left Party 83Switzerland 49, 50Syria 97

technology 159–61telecommunications 83–4 data protection and privacy 10TENs see Trans European Networks

(TENs)terrorism 64, 65, 66textiles 92Thatcher, Margaret 111, 143Tobin Tax 83trade, external 92–8, 22, 32, 67, 77,

126, 134, 155, 184, 186 see also World Trade Organisation

(WTO)trade unions 31, 59, 111, 114, 144training 45, 104, 112, 114, 115,

116–17, 117–18, 156Trans European Networks (TENs)

83–5, 145–6 and industrial policy 153transport 141–8 cost of 85–6, 142 and environmental damage 85,

126Treaty on European Union (TEU) see Maastricht TreatyTreaty of Rome 32 aims of 1 and agricultural policy 132 amendments to 4 competition policy 78 and development policy 96 and energy policy 157



Treaty of Rome continued and environmental policy 119 and equal pay 112 and free movement of goods 76 and free movement of labour 81 and public ownership 84 and state aids 77–8 and transport policy 141Tunisia 97Turkey 38, 43, 49, 149

Unemployment see employmentUNICE (EU-wide employers’ group)

112Union Minister for Foreign Affairs,

see European Foreign MinisterUnited Kingdom 2, 19, 26, 27, 38,

43, 51, 61, 68, 71, 111, 165, 166, 169, 170

United Kingdom Independence Party (UKIP) 1, 28

United Nations Charter 56United Nations Conference for Trade

and Development (UNCTAD) 134

United Nations Framework Convention on Climate Change

See Kyoto ProtocolUnited Nations High Commission

for Refugees (UNHCR) 63–4United States 51, 52, 53, 54, 82, 99,

102, 124universities, relationship with

industry 106

Van Buitenen, Paul 23VAT (Value Added Tax) 38, 39, 89Villepin, Dominique de 177Visa Information System 65–6Volkswagen 90voting rights of EU citizens 58

‘War on Terrorism’ 64Washington Consensus 181–2

waste management policy 84, 123, 158

water supply 84, 123 pollution of 120, 121, 123 privatisation of 96Western European Union (WEU) see

Common Foreign and Security Policy (CFSP)

White Papers, see European Commission

women access to labour market 112–14, 118 and Convergence Criteria 112 and Stability and Growth Pact 112 see also equal opportunities,

gender discrimination, gender equality

workers’ rights Directive on the Approximation of

the Laws of the Member States on the Safeguarding of Workers’ Rights in Conjunction with the Transfer of Undertakings (1977) 111

and Directive on Mergers of Limited Companies 111

European Works’ Councils 112 right to information and

consultation 110–12working conditions 99, 102working hours 99World Bank 182World Customs Organisation 65World Trade Organisation (WTO)

76–7, 93, 94–5, 97 and the Common Agricultural

Policy 134, 135, 136 and Common Customs Tariff 92 Doha ministerial conference 134World Wide Fund for Nature (WWF)

138

Youth for Europe Programme 117Yugoslavia, see Balkan Wars
