Select Committee on European Scrutiny Eleventh Report


COM(01) 619


Commission Communication on structural indicators.

Report by the Economic Policy Committee on Structural Indicators.

Legal base:
Document originated:(a) 30 October 2001
(b) 19 November 2001
Forwarded to the Council: (a) 6 November 2001
(b) —
Deposited in Parliament: (a) 21 November 2001
(b) 7 December 2001
Department:HM Treasury
Basis of consideration: (a) EM of 6 December 2001
(b) EM of 12 December 2001
Previous Committee Report: None; but see paragraph 11.2
To be discussed in Council: Not known
Committee's assessment:Politically important
Committee's decision:(Both) Cleared


  11.1  In March 2000, at the Lisbon Special European Council, the Union set itself a goal for the next decade of becoming "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". The Lisbon Council acknowledged the need for regular assessment of progress towards this goal on the basis of commonly agreed structural indicators. To that end, it invited the Commission to "draw up an annual synthesis report on progress on the basis of structural indicators to be agreed relating to employment, innovation, economic reform and social cohesion".

  11.2  A list of 35 structural indicators, which the ECOFIN Council and the Commission agreed should be used in the Commission's Synthesis Report, was sent to the Nice European Council in December 2000. The previous Committee reported on a number of documents relating to the structural indicators. The Synthesis Report and structural indicators were discussed at the Stockholm European Council in March 2001.[16] On the basis of that discussion, the Stockholm Council called for indicators to be developed on, amongst other things, countering social exclusion, care facilities for children, quality of work and discriminatory pay differentials between men and women. At Gothenburg (June 2001), the European Council called for indicators also to be developed for monitoring progress towards sustainable development. In March 2001, ECOFIN agreed to take a short list of 12 indicators from the 35 indicators as the basis for the Council's discussions and a more concise overview of the performance of Member States.

The documents

  11.3  Document (a) is the Commission's response to the request from the European Councils for amendments to the list of indicators used in the first Synthesis Report. As a result of the Commission's deletions and additions, the new list contains 36 indicators, with some sub-divisions. The new list excludes the following indicators used in last year's Synthesis Report: general government debt; Information Communication Technology (ICT) expenditure; exports of high-tech products; trade integration; business investment; and jobless households.

  11.4  The following indicators are now included: gender pay gap; quality of work (accidents at work) science and technology; market structure in network industries; greenhouse gas emissions; volume of transport in relation to GDP; modal split of transport; urban air quality ; and municipal waste. The new list of indicators will be used in drawing up the Synthesis Report to be published in Spring 2002. Annex 1 sets out the new list.

  11.5  Document (b) presents the views of the Economic Policy Committee (EPC) to ECOFIN on the structural indicators. In general, the EPC welcomes the revisions to the list. However, it suggests increasing the number of indicators in the broad category of economic reform to reflect its central importance to the overall strategic goals. The EPC also considers that the Commission should use the shortlist of indicators in the Synthesis Report.

The Government's view

  11.6  The Economic Secretary to the Treasury (Ruth Kelly) says that the Government is a strong supporter of the Lisbon economic reform agenda. She says

    "Structural reform will lift the long-term potential of EU economies to attain high and sustainable levels of employment, and increase productivity. Greater flexibility, especially in labour markets, will also enable economies to adjust more quickly in the short term to shocks. To achieve these goals, the Government believes that structural indicators are an important tool in monitoring progress on structural reforms, and to highlight areas where further action may be needed."

  11.7  The Minister adds that the Communication from the EPC was an integral part of monitoring the process.


  11.8  Drawing up a list of structural indicators and assessing the performance of each Member State against such indicators is an example of the "open method of coordination". The structural indicators make it possible for the pace of economic reform and social cohesion in each Member State to be quietly monitored and assessed. The results will be used as the basis for the 2002 Synthesis Report. We thought it useful to provide a short report to the House on the revised list of indicators. The Synthesis Reports can provide a useful and stimulating contribution to a debate on progress in implementing the reform agenda. However, it is important to note that any inferences or recommendations from such reports cannot be binding on Member States. We are content to clear the documents.

16  (21673) 11909/00; HC 23-xxviii (1999-2000), paragraph 30 (1 November 2000). Back

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