Select Committee on European Scrutiny Twenty-Fifth and Twenty-Sixth Report


LISBON STRATEGY ON MODERNISING THE EU ECONOMY AND SOCIAL MODEL


(23186)
5654/02
COM(02) 14
and ADD1
REV 1

Commission Communication to the Spring European Council in Barcelona: The Lisbon Strategy — Making Change Happen; and Commission Staff Working Paper.


Legal base:
Department:Foreign and Commonwealth Office
Basis of consideration: Minister's letter of 19 April 2002
Previous Committee Report: HC 152-xxi (2001-02), paragraph 6 (13 March 2002)
To be discussed in Council: Barcelona European Council on 15/16 March
Committee's assessment:Politically important
Committee's decision:Cleared



Introduction

  9.1  The Lisbon European Council in March 2000 set a ten-year goal for making the EU "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." It was also agreed at Lisbon that future Spring European Councils should evaluate progress and mandate work for the next year, on the basis of a "synthesis" report prepared by the Commission.

The Minister's letter

  9.2  In his letter of 19 April, the Minister for Europe (Mr Peter Hain) says that the Commission Communication, known as "the Synthesis Report", made an important contribution to discussion at the Barcelona Spring Council. As well as measuring progress towards the strategic goal agreed at Lisbon, and identifying key areas where further or fast progress is needed, the Synthesis Report set out a number of specific proposals for actions to be agreed by the European Council at Barcelona. The Minister says that a number of these proposals are reflected in the Barcelona Conclusions:

    "Energy

    "There was agreement on a deadline for full liberalisation of the EU's non­household gas and electricity market, and a decision before Spring 2003 on full liberalisation of the remaining market.

    "In parallel to progress on liberalisation, Heads of State called for agreement in Council on the adoption of the energy tax directive before the end of the year.

    "There was also agreement on a target for Member States to increase their level of electricity interconnection to the equivalent of 10% of their installed production capacity by 2005.

    "Employment, mobility and training

    "The Barcelona Conclusions re-emphasised full employment as the essential goal of economic and social policies. The summit set the framework for the 2002 mid­term review of the European Employment Strategy. It agreed a number of steps that Member States should be taking in the interim to reform labour market policies e.g that, where Member States pursue tax cuts, they should give priority to cuts that reduce the burden on low-wage earners — and tax benefits systems should be reformed to make work pay and remove disincentives to work.

    "There was also agreement on the need to reduce incentives for early retirement, and to increase opportunities for older workers to remain in the labour market. Targets for the provision of childcare — designed to improve labour market participation rates amongst women — were agreed: Member States should strive to provide provision for 90% of children between 3 and mandatory school age, and 33% of children under 3 by 2010.

    "In response to the Commission's Action Plan on Skills and Mobility, Heads of State agreed four priorities: putting in place the legal framework to encourage greater mobility: reducing barriers to recognition of professional qualifications; ensuring all citizens are equipped with qualifications; and increasing where appropriate the transferability of social security rights.

    "Small and Medium-sized Enterprises

    "The importance of speeding up implementation of the European Charter for SMEs was emphasised, and there was agreement that Ministers with responsibility for SME policy should meet before each Spring Council to assess progress in this area.

    "Better Regulation

    "The Conclusions call on the Commission to submit its Action Plan for improving and simplifying the regulatory environment in time for the Seville European Council in June.

    "Transport

    "The Barcelona Conclusions call for progress this year so that the Single European Sky can be agreed by 2004, and for adoption of proposals on port services and the award of public service contracts in the transport sector.

    "R&D

    "The conclusions reaffirmed the importance of reaching final agreement on the 6th Research Framework agreement by June 2002.

    "There was also agreement that the EU should aim to increase average spending on R & D towards 3% EU GDP by 2010, with a focus on increasing investment in the private sector.

    "State Aid

    "The Summit underlined the importance of 'less and better' state aid: reducing the overall level of state aid as a percentage of GDP, and redirecting aid towards valid horizonta1 objectives.

    "Financial services

    "There was agreement on adoption by the Council of seven key financial services directives by the end of the year: Collateral, Market Abuse; Insurance Intermediaries; Distance Marketing of Financial Services; Financial Conglomerates; Prospectuses; Occupational Pension Funds; and the International Accounting Standards Regulation.

    "eEurope

    "Heads asked the Commission to produce a second eEurope Action Plan (the first comes to an end this year), focussed on helping to deliver widespread availability of broadband technologies (faster and more interactive internet services) across the EU by 2005."

  9.3  The Minister then says:

    "Not all of the actions proposed in the Synthesis Report were endorsed by the Barcelona Conclusions. In some cases, where the Commission has yet to publish draft legislation, the European Council simply took note of the Commission's intention to come forward with a proposal e.g. a Framework Directive on transport infrastructure charging. As I made clear in the Explanatory Memorandum, where the Commission indicates it will come forward with new proposals, we will need to consider the detail and appropriateness of the proposals when they are published.

    "Barcelona was a success — making good, solid process towards the ten-year Lisbon objectives. The Summit needed to demonstrate that the economic and social reform agenda remains on track, and it did. Significant progress was made in a number of areas: energy liberalisation; research and development; eEurope; single sky; financial services. The fact that many of the key conclusions reflect actions highlighted in the Synthesis Report is evidence of the Commission's constructive role in driving forward the Lisbon agenda. The report is now established as a key milestone in the Lisbon calendar, providing important continuity between Presidencies.

    "I also note the Committee's comment on the use of qualified majority voting (QMV). The use of qualified majority voting in areas where it is provided for by the Treaty inevitably varies from Council to Council, depending on the level of consensus that exists between Member States on the issues in question. Moreover, the fact that the Presidency has the option of using QMV will often be enough to encourage agreement, even where a consensus does not exist. There was no discussion of QMV at Barcelona."

Conclusion

  9.4  We thank the Minister for his account and in particular for his comment on the use of qualified majority voting. We also note his observation that the "Synthesis Report" has become an established milestone in the Lisbon calendar, providing important continuity between Presidencies, and we welcome this useful management tool.

  9.5  We pursued questions arising from the Lisbon Strategy and the Barcelona Council during today's evidence session with the Minister and now clear this document.



 
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