Resumption of the session
President
I declare resumed the session of the European Parliament adjourned on Friday, 15 May 1998.

Tribute
President
 Ladies and gentlemen, it is with profound emotion that I have to honour the memory of our colleague Francisco Lucas Pires. Professor Lucas Pires had been a member of our Parliament since Portugal joined the European Union and was twice its Vice-President. He brought a brilliant and cultivated mind to the ideal of European construction, and enriched our Parliamentary debates by contributing the historical experience of one of the oldest European nations.
The example of Francisco Lucas Pires, whose last public act was to open the European Union pavilion at 'Expo 98' , will remain with us as a model of European citizenship, and as a man deeply committed to his country's causes, but always able to understand and defend the imperatives of European construction.
The flag of the European Union is being flown at half-mast in his honour. I would ask you to observe a minute's silence in his memory.
(The House rose and observed a minute's silence)

Approval of the Minutes
President
The Minutes of Friday, 15 May 1998 have been distributed.
Are there any comments?

Rübig
Mr President, I would just like to have recorded in the minutes that during our last week in Strasbourg the French police did a splendid job of guarding the European Parliament, and that they were visibly present in the proximity of the Parliament.

Medina Ortega
Mr President, the employees of the company Air France have announced that they will be on strike for two weeks, starting from next Monday. If this strike takes place, we MEPs will not be able to get to Strasbourg for the next part-session. Has the Presidency taken any precautionary measures, in view of this possibility?

President
Mr Medina Ortega, all I can do is constantly remind the French authorities of the regrettable state of transport provisions to Strasbourg. I am doing this, and last week I spoke to the minister concerned. Of course, in view of the strike announcement, I will contact him again, and ask him to take the necessary special measures.

Kreissl-Dörfler
Mr President, I am also pleased that the French police guarded us so well, of course, but I want to ask Mr Rübig if he has another record in his repertoire, and if he will stop boring us with this rubbish!

Banotti
Mr President, I am sure that you are going to mention it and I am sure colleagues will share our joy in Ireland at the ratification of both our referenda.
(Loud applause) It was a stunning victory for the Belfast Agreement, a slightly less stunning but nonetheless sixty percent victory for the Amsterdam referendum and we hope now that we will see a similar result in Denmark in the next couple of days.

President
Mrs Banotti, you expressed it much better than I could have.

Roth
Mr President, ladies and gentlemen, I refer to Annex V of the Rules of Procedure, Article 1(1)(b). This deals with the reproduction and distribution of reports from the Court of Auditors. Let us remind ourselves of the Treaty of Amsterdam. It frequently refers to transparency but in the last few days I have had to ask myself what the actual state of transparency and openness is here in our House! Firstly, it is absolutely preposterous that an official interim report from the Court of Auditors on the reimbursements and allowances of Members of the European Parliament has been available to the President for about a month, according to our information, that it has been available to the Bureau since 13 May, but that not all the groups have been informed. Moreover, Members of this House have not received this important document, and have had to obtain details from the press!
I have to tell you that I think that both the President and the Bureau have behaved in a really irresponsible way in this matter and that such behaviour leads to mistrust on our part.
(Heckling from Mr Wijsenbeek) We call for the immediate publication of the report, both internally and externally, and demand information on whether there are further reports or whether there is an annex, for example.
Secondly, it is completely unacceptable - would you please shut up, Mr Wijsenbeek - if a subject which affects all members of all groups is discussed and decided upon by the EDU behind closed doors and excluding our group, the ARE Group. Our Secretary General was expelled from the room this morning. That is why we are calling for a special session of the Presidents' Conference because it is inadmissible that such decisions, such debates whose scope really affects each and every one of us should be handled in a body on which all of the groups in this House are not represented!
(Applause) Thirdly, our strongest criticism is directed at the way in which necessary reforms which have long been called for are being systematically delayed and obstructed in this House, reforms which are desperately needed if the European Parliament wants to be credible, if it wants to be accepted, if it wants to seek more rights for itself.
(Noise) The report from the Court of Auditors tackles precisely these shortcomings...
(The President cut off the speaker)
President
Mrs Roth, when you quote an article, you must read it first. The article you invoke states that the Court of Auditors' special reports must be printed and distributed, together with the replies from the institutions. The document you are referring to is not a report, but consists of preliminary observations. So this Parliament's Bureau, which is the competent body, has not yet issued its replies.
Secondly, Mrs Roth, all the political groups received a copy of the document yesterday. Those preliminary observations have been sent to all the political groups. So if you want to communicate them to the members of your group, you can of course do so, just like any of the other group chairmen. It is up to you. It has not been kept secret: it is in your hands. What I cannot do is give out a confidential document, which has to be examined by the Bureau, before the Bureau has seen it. The VicePresidents have to see it first, which is what has happened. Read the Rules of Procedure - not what the Green Group wants to read, but what the Rules of Procedure actually say. And if you want to change them, then do so through the appropriate channels. Unless they are changed, I do what they say.
Mr Brinkhorst, are you going to comment on the Minutes?

Brinkhorst
Mr President, to react to what you were just saying: I understand that the Bureau would like to discuss this but I believe that we have a right to know soon what is happening. The press is constantly attacking us in Germany, the Netherlands and in other countries. So from that point of view I hope you have some understanding that there is a concern about these issues.

President
I appreciate what you say, but my first obligation is to apply the Rules of Procedure. In accordance with those rules, I first forwarded the observations - which, I repeat, do not constitute a report - to the Bureau, which is the body responsible for such matters. Secondly, when there were questions about that report, it was given to all the political groups. So, the report will be printed and distributed once it is in its final form, not in its current provisional form. Speak to your group chairman, who will give it to you.
Mr Wijsenbeek requests the floor, to reply to personal statements. What statements are you referring to, Mr Wijsenbeek?

Wijsenbeek
Mr President, I should like to make a statement pursuant to Rule 108 on grounds of personal remarks:
If we are talking here about people shutting their mouths, we all know whose mouth is always open and who arouses suspicions in respect of hard-working and honest colleagues because the Greens would like to base their election campaign on these suspicions, and that is why I open my mouth.
(The Minutes were approved)

Agenda
President
I would remind you that in our sitting of 12 May, Parliament decided that the report (A4-0188/98) by Mr Marset Campos, on behalf of the Committee on Research, Technological Development and Energy, on the rules for the participation of undertakings, research centres and universities in the implementation of the Fifth Framework Programme, would be included as the last item of today's agenda.

De Melo
Mr President, it appears to me that a communication from the Commission on some urgent and very important political issues has been cancelled. I would like to ask a question. In view of recent events in Indonesia, there is an urgent need for the situation of all political prisoners to be dealt with here, especially Timoreans and their political leader, Xanana Gusmão. My question, Mr President, is: has this subject - the first one on the agenda - been cancelled or postponed until a more convenient date?

President
It is indeed postponed to another day, because at this time the Commission prefers to make its statement on urgent matters relating to the preparations for the European Council meeting in Cardiff on 15 and 16 June. So, if there are no further comments, we shall approve the amendment to the agenda and proceed to debate that matter.

Preparation for the European Council meeting in Cardiff
President
The next item is the statements by the Council and the Commission on preparation for the European Council meeting in Cardiff on 15 and 16 June 1998.

Cook
Mr President, at the start of my address may I say that I should offer my apologies if what I have to say about Cardiff is not as interesting or as exciting as the points of order you have just heard. I regard it as a privilege to be able to listen in to such an exciting and robust exchange of views. It is a tribute to the health of democracy in our continent.
I am here this afternoon because in just two weeks' time the European Council will meet in Cardiff. This will mark the culmination of our presidency. We have sought to use the presidency to demonstrate the changed approach of Britain towards the European Union. The government of Britain came to power determined to show that Britain was now a committed and constructive partner within the European Union. I believe that our presidency has underlined our success in making that transformation of Britain's approach to Europe.
Two of our key priorities were to get enlargement off to a flying start and to get the third stage of Economic and Monetary Union under way. Both of those key priorities have already been achieved. I suppose that prompts the question whether there is enough left for us to do at Cardiff to avoid the summit of our presidency being an anticlimax to the achievements that have already marked the historic milestones of our presidency. I am pleased to say to the European Parliament that there will be full, busy and important agendas before us at the European Council in Cardiff. In the course of the summit we will examine economic reform, Agenda 2000 and the future of the European project. We will also explore some of the ways Europe can make a difference in the areas that directly affect our people: on crime and on the environment. We will also at that summit welcome - and welcome for the last time - President Mandela who will be joining the Heads of Europe for lunch on the second day of the summit. At his request we are meeting with him in order that before he leaves office he may say farewell to the leaders of Europe who have worked so closely in partnership with his leadership of South Africa to achieve one of the major gains for democracy and ethnic tolerance that we have seen in our generation.
Before we get to that point in the Council we will have completed a large amount of business. Let me start with the issue of economic reform. We came to the presidency determined that throughout our presidency jobs would be a key theme and a high priority. At Cardiff we will be completing much of the work that we have been putting in place over the past five months. We will be reviewing the progress that Member States have been making on the single market and will be agreeing to further actions to help take us towards an effective, competitive economy which includes within it an inclusive society in which everybody has the opportunity to contribute and participate through work.
We also plan discussion of the competitiveness agenda. If Europe is to prosper in the long term we need to create an environment in which small and medium-sized enterprises can flourish. They need to be able to have access to the finance that will enable them to flourish. They need to be free from unnecessary red tape. Europe has no shortage of creativity and imagination. We must provide the opportunity for that creativity and imagination to express itself through entrepreneurship which will bring Europe prosperity and jobs.
Also we will be reviewing the employment action plans drawn up by Member States since the special Luxembourg Council. This will be the first European Council to have in front of it action plans from every Member State on how they intend to promote employment and to reduce unemployment. We will want to see what conclusions and lessons can be learned from those plans. We want to make sure that every Member State can share the best practice of other Member States on their policies on employability, adaptable labour markets and on equal opportunities in the marketplace. There are, of course, difficult policy questions raised by those action plans: questions on how we reform our tax and welfare systems so that it pays to work and how we can make it possible for women to combine work with family. If we are to get it right, we need to make sure that we share the best practice in each of those areas.
The European Council in Cardiff will also give high priority to an interim discussion on the Agenda 2000 issues: reform of the Structural Funds and reform of the common agricultural policy; on discipline in our budget procedures and on how we adapt the European Union so that we ourselves are prepared for the enlargement for which so many aspiring candidates are now preparing their economies and their societies. Since the Commission published its detailed proposals on Agenda 2000 in March, as the presidency, we have set up an intensive work programme to carry forward discussion on the Commission proposals.
Ministers throughout a number of the Council meetings have reviewed that work and have discussed how they relate to each other. At the General Affairs Council only two days ago we had a two-hour discussion on the presidency's report of the work in progress on Agenda 2000 and that extensive discussion, in which every Member State took part, will be of great value to the presidency in preparing a text for the European Council which can provide authority and direction to both Commission and Council officials in carrying forward the Agenda 2000. We are very mindful that the European Parliament would like to see decisions taken on these matters before the next elections to the European Parliament. It would be our aim to achieve successful conclusions at Cardiff consistent with a timetable which would enable a special European Council in the spring of 1999 to reach final decisions on Agenda 2000.
I would also stress that a key theme of Cardiff will be to demonstrate how, throughout our presidency, we have sought to make Europe work for the people, to make sure we focus on issues that our people care about and the issues that affect them directly. If the European summit is a success, it will only be so because the people watching what the Heads of Government perceive that what they are talking about and what they are deciding has relevance to their lives. We must not portray an image of the European Council meeting to discuss matters that are only of concern to top politicians. They must be seen to take forward an agenda that is relevant to the concerns and the lives of the ordinary families of Europe.
There are two particular issues on which we will be focusing attention at Cardiff: improving the environment and fighting crime. The joint Transport and Environmental Council meeting which we held in April - the first such joint meeting between environment and transport in the history of the Union - showed how we can integrate environmental concerns into the development of other European policies. At Cardiff the Council will discuss a Commission report on how we can make sure that precedent of bringing together environmental strategy with transport policy becomes the norm across the work of the European Union and not the exception.
The Council will also discuss the progress we have made in fighting crime together, in particular in the work we are now carrying out through the European Conference with all the applicant countries to make sure that existing Member States and future Member States work together now - not after they become members of the European Union, but now - on the common problems of cross-border trafficking in crime which affect both the existing members and the future members.
So, there will be a busy agenda for Cardiff. There will be a lot of ground to cover and I hope I have demonstrated that much of the agenda will be on practical, specific measures which demonstrate to our peoples that real progress is being made. But, while we take forward that practical agenda, it is important that we also keep in front of us the vision of the kind of Europe we are trying to create. Having brought together all the heads of government of Europe, it seems only right that we should find space in that crowded agenda for them to address the question of what kind of Europe we are trying to build. And that is why at this European Council, unlike most recent European Councils, at the lunch for heads of government they will have an open discussion on the type of Europe we want to see for the next century and what its model might be; on what more we need to do to create a Europe which can function and function well with 26 members as opposed to the 6 members with which Europe started. And, in particular, how do we take forward those institutional issues which were not completed at Amsterdam but which are necessary if we are to reform the structures and the decision-making processes of Europe in order to make it fit for the new larger Europe which we will see in the first decade of the next century.
That is an exciting task. I do not think that many people in our own countries have yet grasped the immense historic step which enlargement represents for Europe. Very few of our own people yet understand that sometime over the next ten years we will see a Europe which will stretch from Portugal to Poland, from Scotland to Sicily, a Europe which will be almost half as large again in land area and a third larger in terms of population and in terms of consumers within the single market. That is a tremendous quantum leap for Europe. That is why it is right that when we meet in Cardiff we should find space to reflect on what that means for Europe and what type of Europe and model for Europe we can best offer that will meet the continuing vision of those who are present members and the hungry aspiration of the new members to join in the democratic family of nations we have built. If we have a successful discussion on that theme we will have an agenda for Cardiff with the right balance between practical, detailed progress and visionary discussion about the model of Europe for the future. I look forward this afternoon to hearing the input of the European Parliament as to how we can take both those parts of the agenda forward at Cardiff.
(Applause)
Santer
Mr President, Mr President-in-Office of the Council, ladies and gentlemen, Members of this House, this afternoon, with an eye towards the forthcoming European Council in Cardiff, I would like to conduct a brief survey of the current state of European integration and also raise the major political topics to be tackled at the summit in Cardiff, before outlining a few avenues we might explore for the future.
First of all, my message to you today is one of optimism. It seems to me, as we approach the Council meeting in Cardiff, that a wind of success and progress is blowing through the Union, stirred by the imminent introduction of the euro and Economic and Monetary Union. Again, as the Cardiff meeting approaches, it seems to me that confidence is being restored and is growing; in effect, the macroeconomic balance sheet is healthy and forward-looking, interest rates are down, inflation is minimal, public expenditure is under tight control, the upsurge is making itself felt in many sectors, economic reform on the supply side is beginning to produce results and the first signs of drop in unemployment are beginning to make themselves felt.
Add to that the fact that the Treaty of Amsterdam should be ratified shortly, that the detailed proposals we submitted within the framework of Agenda 2000 are now at the negotiating table and that enlargement is under way. Is this not proof positive that the European Union is up and running, that it abides by its commitments, that it keeps to its deadlines and that it is on the right track? Mr President, I am delighted that this programme submitted by the Commission should now be under scrutiny.
In close cooperation with the Parliament and successive presidencies of the Union - I will take this opportunity to thank the British presidency for having devoted so much effort - our institutions are now performing their motivating function to the full in this powerful movement towards increased integration. The political message that Europe would like today to send out to the rest of the world is crystal clear: it can take action and is taking action. From a political standpoint, we should seize the day.
But there is one item that seems to me to be even more important: in truth, I detect an increasing political consensus, both here and in the Member States, concerning the resources required to tackle the remaining structural problems. The national employment plans, approved by the European Council in Luxembourg, are especially important in this context. These alone bear witness to a wealth of exciting ideas, the convergence of policies to combat unemployment constructed around common guidelines, and joint mobilization with social partners.
I also sense the existence of a common political will to bring the domestic market swiftly to a successful conclusion, in accordance with our plan of action in favour of the single market. I am also especially pleased to note that the incorporation of Community regulations is improving and deservedly so.
I note too that we all feel the need for a more enterprising Union, a Union able to take new technologies and ideas on board and to expand upon them within the Union: able to help small enterprises take off, grow and prosper and capable too of eliminating red tape and allowing our creative talents to flourish; able, finally, to take job creation and rising prosperity in its stride. These subjects will certainly be uppermost in the minds of those in Cardiff.
To conclude, I also feel that the majority of us are aware that we could do better in terms of justice with regard to domestic matters and the CFSP; we simply need to establish the necessary collective political will.
The debates planned for Cardiff will address the matter of economic reform, Agenda 2000, enlargement and our external priorities. We will also have the opportunity to speak about the environment, in particular the way in which we might incorporate environmental issues when drawing up other Community policies. All our institutions should swiftly build upon the progress already made towards achieving this objective. I assume, too, that this touches upon the question of progress made by the Community and Member States towards fulfilling the commitments they have made under the terms of the Kyoto protocol with regard to reducing gases generated by the greenhouse effect.
In addition, I am extremely glad that time has been set aside for a debate on the future direction and development of the European Union, the challenges it must face, the need to gain the trust of our people and the vision we need to attain that goal.
The debate on economic reform will span the entire range of policies needed to reinforce and maximize the advantages of Economic and Monetary Union. Obviously, the aim is to further employment prospects through increased competitiveness and social cohesion in a stable macroeconomic environment. Amongst other subjects, our discussions will also focus on the approval of our major economic policy guidelines with a view to rounding off this excellent procedure by intensifying microeconomic control for closer monitoring of the extent of integration of products, services and capital markets throughout the Union, in order to boost the gains of a single currency.
The European Council will also examine progress made in terms of national plans of action to promote jobs. Of course, we are still at an intermediate stage, but I am impressed by the determination of all our Member States to get the process off the ground. In Cardiff, we will brush up on the main topics that emerge today: increasing the capability for vocational integration, promoting equality of opportunity, improving the adaptability of job markets, creating a favourable climate for the development and growth of the spirit of enterprise, especially with respect to small companies. This constructive process will give rise to a mutual, multilateral development and communal emulation through peer pressure.
Between now and the meeting in Vienna under the Austrian presidency, we have four stages to work through in order to improve employment strategy. In effect, from the outset, we must define common indicators and a specific terminology. Secondly, we must encourage the Member States to incorporate their job action plans in their national budget. Thirdly, we must bolster cooperation and implementation with our social partners and, finally, establish links between the national plans of action for jobs and the projects financed by the European Social Fund.
On 18 March last, the Commission submitted its legislative proposals for Agenda 2000. This autumn, those proposals will be accompanied by a report on the operation of the own-resources system. All the individual elements will then be examined together to reach a decision regarding all of these measures with full knowledge of the facts, since we require legislative decisions before the new European Parliament is elected. Furthermore, we should seek practical methods enabling the Parliament to perform its function fully, as it did last time, within the tight schedule imposed on us. The initial intensive negotiations, under the British presidency, have already begun.
The various opinions I have heard strengthen my conviction that our basket of measures is fair and balanced. In Cardiff, we will take note of the progress achieved. Either the agreement is absolute, or there will be no agreement. However, I hope that we will be able to record the existence of a significant convergence of views in several areas: the need to intensify reforms of the common agricultural policy, the need to reform the Structural Funds based on the concentration, simplification and clear demarcation of responsibilities; substantial pre-accession provisions in the agricultural, structural intervention, investment aid and administrative aid sectors, inculcating a sense of community spirit amongst all the candidates; a balanced financial framework to finance the reforms and pre-accession assistance, within the budgetary discipline and leaving a sufficient margin to finance the first new membership wave; finally, we need to negotiate a new interinstitutional agreement based on the same fruitful cooperation that governed relations between the two budgetary bodies during the last period.
If we find that we can proceed on this basis, we should be able to take major steps forward during the course of the year. I hope that the European Council will take on this commitment in Cardiff and will set a timetable for the entire process. In Cardiff, we shall assess the considerable progress made in the implementation of the Luxembourg conclusions regarding enlargement. Since the last European Council, the overall enlargement process has taken off successfully. The European Conference met in London on 12 March, thereby officially opening a forum seeking to bring together the Member States of the European Union and those European States wishing to secure membership and sharing internal and external values and goals.
The European Commission regrets that Turkey has still not confirmed its intention to take part in this Conference and hopes that that country, a most important partner, will be in a position to decide that it can participate in the near future in the work in progress in this context.
Aside from this, eleven candidate countries have committed themselves to the accession process and negotiations have already begun with six of them. We believe that a major breakthrough has been made through development of the accession partnership with the ten candidate countries from central and eastern Europe. As with the national strategies deployed in those countries, the accession partnerships have opened the way to successful future negotiations and, hopefully, their eventual integration in the European Union.
In Cardiff, the European Council will also take account of the many events that have taken place during the last six months externally. I shall confine myself here to summarizing the encouraging result obtained during the last summit between the European Union and the United States of America on 18 May last, in London. The political agreement concluded at the highest level will enable us to settle the trade conflict generated by the Helms-Burton and d'Amato Acts. We hope that the commitments undertaken by the government of the United States will be fully endorsed by the Congress.
Mr President, when I announced my 'Less action, but better action' policy at the beginning of my mandate as President of the Commission, I intended to make it a broad guideline for our future work. In other words, I hoped to focus our efforts - the right of initiative of the Commission - on key priorities, in total compliance with the principles of subsidiarity and proportionality.
The Commission will submit a report on the situation to the European Council. This report is entitled: "The facts' and it records a very serious decline in new legislative proposals since 1990. Our consultations with partners of the Commission have increased, we have improved the quality of our legislation, we have also simplified that legislation, we have kept our citizens better informed and incorporation is steadily improving.
But this report also notes that too frequently we are compelled to take action in areas that should not lie within the jurisdiction of the Community, that the pressure on us to legislate, exerted mainly by Member States - sometimes by the European Parliament itself - is unceasing, especially in technical fields, mostly from those Member States waving the flag of subsidiarity most ardently. Finally, the simple, extremely sensible proposals we put forward are subsequently converted into instruments of a complexity that I would willingly qualify as "Byzantine-kafkaesque' .
(Laughter ) The Commission must continue to play its political role forcibly and quite independently. It must remain the custodian of the Treaty. We shall submit proposals seeking to intensify and expand European integration in the field covered by the Treaties. This is our role, confirmed yet again, I might say, by the Treaty of Amsterdam.
Nevertheless, we should be aware of the direction we seek and we must also find the means and the opportunity to persuade other institutions that we are on the right track. In effect, if we look closely at our political balance sheet, one thing stands out clearly: it is generally in those areas where the Commission performs a motivating and stimulating function based on its right of initiative, that real progress is made.
This is why I say yes to subsidiarity, yes to a more political and better-defined European Union, but I say no to those who wish to use subsidiarity to slow down the process of European integration and I say no, even more vehemently, to those who seek to upset the institutional balance of our Union.
Mr President, I would like to make the European Union the first world platform for trade and international investment. I would like to think that together we are building a European model of growth and prosperity of a truly universal nature, offering opportunities, partnerships and stakeholder status to our social partners and all members of society, based on equality of opportunity and fairness.
To achieve that goal, we must continue to move forward and I feel we need to think again in terms of reinstating the dynamics of social dialogue and establishing a social Europe; fresh ideas about what we understand by the "public interest' ; new conceptions regarding the relevance of the world market as an economic reference point; new methods for incorporating ethics, science and the environment in our policy-making process; a broader view of trade, encompassing the environment and social rights, an intensification of the multilateral nature of the Union since it has always been to our advantage in the past and will continue to be so in the future; a strengthening of our ability to act with firmness.
I also believe that the time is ripe for us to reflect once again on our collective roles: that of the Commission, of course, but also the Parliament and the work of the Council. The stakes have never been more obvious; we need to create, for the European Union, an institutional system that is better than any other in the world, in other words a more flexible and responsive system, better adapted, more efficient, democratic and wholly transparent that meets the expectations of our citizens, that can attract their interest and encourage them to take a deeper plunge into the process of European integration and, finally, a system that can tackle without delay the numerous decisions arising from the immense European interests.
In conclusion, Mr President, we need an extensive body of legislation, external relations and cooperation, which represent for the Union a genuine institutional asset in the coming new millennium. I am convinced that the European Council in Cardiff will mark an important stage in the process towards these bold objectives.
(Applause )
David
Mr President, at the beginning of the British presidency, the British Prime Minister called for a Europe that works together as a team. Tony Blair said that the mission of the UK presidency was to 'make Europe work for the people' .
As we approach the Cardiff summit and the end of the British presidency, we in the Socialist group firmly believe that the British Government has been true to its word. Jobs and employability have been given the attention they deserve. Agreement has been reached for the launch of a single currency on 1st January next year. The process of enlargement has begun and the presidency has not flinched from ensuring that a firm start has been made on difficult issues like the reform of the common agricultural policy and the Structural Funds. But I would hope that all the legislative procedures with regard to Agenda 2000 will be implemented by June 1999 and that this European Parliament is fully involved in all of the procedures. Mention should also be made of the progress towards a creation of a more effective Common foreign and security policy. I would like to congratulate Mr Cook in particular on his initiative with regard to a code of conduct on arms exports.
Progress has been made on these and indeed on many other areas but I would particularly like to refer to the fact that the British presidency really has had a very real physical presence in the European Parliament. For example, I have been doing a little homework and I have been very pleased to find that British ministers have appeared at every plenary session during the presidency. There have been sixteen appearances covering thirty separate debates; there have been forty eight presidency appearances before committee and by the end of the presidency over eighty British Government ministerial appearances will have taken place. That is a very good example and if anything marks a clear break with the previous government, it is that very material presence of this administration with the European Parliament.
As we approach the Cardiff summit, we must not only take stock of what has been achieved but perhaps more importantly we need to look to the future. We need a focus on the issues which will take us from Cardiff to Vienna and for the Socialist group top of the agenda has to be the issue of the economy and employment. We warmly welcome the fact that following the Luxembourg job summit employment plans have been submitted by national governments. The urgent task now, however, is to ensure that both plans are implemented as quickly and effectively as possible.
The plans, of course, will vary from one Member State to another but it is important for us all to recognize the need for common themes among our various approaches. For example, if Europe as a whole is to prosper in the global economy we have to compete effectively in that global economy. Competitiveness is not a take-it-or-leave-it option, on the contrary competitiveness is an essential prerequisite for sustainable economic success. At the same time, we need to recognize that there are a number of factors which determine whether or not we can compete effectively. Amongst these are the skills, adaptability and the motivation of our workforce, the extent to which we can develop an entrepreneurial and innovative culture and a degree to which we can invest in our economy for the future.
It is therefore essential that we all recognize the importance of research and development and of science generally. I would in this regard urge the Council to make available appropriate funds for the Fifth Framework Programme on research and technological development.
Finally, as the Member of the European Parliament representing Cardiff, I am immensely proud that the European summit is being held in the capital city of Wales. Today, Cardiff is emerging as a truly European city. It is a city proud of its traditions but also a city optimistically looking towards a future. Indeed, given that this summit will come at the end of a presidency which I am sure will be judged as a resounding success, there could hardly be a better host city than Cardiff.

Provan
Mr President, we in the European People's Party are looking forward to a great success in Cardiff. We want a great success because, let us face it, the presidency at the present time needs a success.
As a British Member it is with a certain sense of sadness - not anger, not political antagonism - that one hears repeated references to the lack of success of this presidency in leadership of the European Union. The key to all successful presidencies is leadership. To what extent can a Foreign Secretary, whose standing in his own country has fallen to a relatively low point, have any claim to speak on behalf of the European Union? So far, this presidency has done little to combat the Union's lack of influence, even on our own doorstep. We have not achieved very much in Algeria, Israel, the Middle East or, as the President of the Commission referred to, in Turkey.
This presidency, unfortunately, will go down in history as having been responsible for the worst-managed senior appointment in international terms ever made, that of the Presidency of the European Central Bank. This could have been avoided and far-reaching damage could have been avoided if, when the problem was obvious, the need for compromise had been recognized earlier. The EMU project as a whole would not have been made to look as ridiculous as was done on 2nd and 3rd May.
Indeed, the whole political system in the European Union was made to look ridiculous at that time. Let us be more positive, we want to see a success. What could be achieved at Cardiff to redeem this sadly discredited presidency?
First we need to see real progress on Agenda 2000. Agenda 2000 is important as everybody has so far mentioned. It is important because the World Trade Organization and its negotiations will be starting in early 1999, as was agreed in Geneva last week. It looks at the present time as if the European is awaiting pressure from outside in the World Trade Organization talks to force CAP reform. Well, we have been talking about CAP reform for many years and it is time we actually started to make progress so that enlargement can take place.
Enlargement is probably the most important single issue facing Europe at the present time We need to hold out our hand of friendship because it is nine long years since the Berlin Wall started to crumble. Not only do existing policies need to be reviewed but also how decisions in the European Union are going to be taken in the future. Those are important issues, ladies and gentlemen, and I hope that the Council can move them forward in Cardiff.
The third really important aspect, as the President-in-Office of Council has mentioned, is employment. We need an inclusive society and that means that we have to tackle some of the current heavy regulation. Twenty million unemployed is not a good record and the record of job creation is also lamentable at European level. We need flexibility, lower taxation, freer trade and a reduction in social costs. President, I hope we can look forward to success at Cardiff.

Pasty
Mr President, ladies and gentlemen, we expect three major policy guidelines from the next summit in Cardiff. Firstly, a political revival, a wish expressed by Chancellor Kohl and President Chirac during the last Franco-German summit, of the institutional reform of the European Union, which was totally sidelined when the Amsterdam Treaty was adopted. Not only must this reform take place before the current accession negotiations are completed, but if it yielded clear policy guidelines quickly, it would greatly assist the Amsterdam Treaty ratification procedures currently in progress.
In truth, it is difficult to impress upon public opinion the need for new delegations of power to European institutions until their ultimate architecture has been defined, whether this relates in particular to the weighting of votes for a qualified majority, linking national parliaments to the drafting of policies concerning the second and third pillars or, indeed, the phasing-in of a credible mechanism aimed at guaranteeing compliance with the principle of subsidiarity. Finally, the summit in Cardiff must formulate policy guidelines concerning the negotiations known as Agenda 2000. Agricultural workers in the European Union need to be placated regarding the future of the CAP and its financing. But, to date, they have not received the reassurances they wanted. They are not opposed to a reform of the CAP in the sense of a fairer distribution of aid, but they do not wish to be sacrificed to the world free-trade ethic or the financial constraints imposed by enlargement. Similarly, the existing beneficiaries of the Structural Funds seek some sort of guarantee regarding the implementation of policies pursued to reinforce social and territorial cohesion in the European Union.
Finally, with a view to the implementation of the Amsterdam Treaty on the convergence of employment policies, the summit in Cardiff will need to examine the action programmes tabled by the individual Member States. It is important that this should not be seen as a purely formal exercise and that the President-in-Office of the Council confines himself to collecting the essays handed in by individual pupils in the class of Europe and leaves the teacher to allocate the good and bad marks. What we need is the introduction of a common strategy with regard to job creation that should be steered towards a significant reduction in the burden hampering those least qualified in the labour force, the harmonization of VAT rates which should be reduced in the case of activities shouldering a substantial share of the wages and welfare costs, and seriously encouraging the development of job creation sectors, such as small and medium-sized enterprises, craftsmen, the liberal professions and ancillary services.
It would seem that a huge consensus exists regarding all of these matters that are actually on the agenda for the summit in Cardiff, but we note, from one Council to the next, that this consensus is not actually translated into tangible implementations that can be seen to reflect those good intentions. So we look forward finally to a firm response to the considerable expectations of our European fellow citizens. Let us hope that the summit in Cardiff will not be, for them, a further cause for disappointment.

Watson
In January the President-in-Office told us that every new presidency brings its own new national drive and new range of experience and a new determination to make its mark. Cardiff will be the defining moment of the new UK presidency. Will it bear the hallmark of the new drive and the new determination of New Labour's new presidency? On the economic front your agenda is substantial: liberalization of capital and labour markets, new initiatives on venture capital, a new agenda for training and employability and employment action plans. Indeed, in its presidency, as at home, your government has pursued economic policies of which your monetarist predecessors would have been proud. I ask simply whether in Cardiff at the issue of the Welsh valleys which nourished socialism in Britain they will remember the face of their father as he walked back home from the mine.
Unemployment remains the scourge of our continent and while we welcome the work done we need more than training schemes and tax cuts. Where are the measures to cut red tape for small businesses? Where are the plans to shift the burden of taxation away from the things we want more of like jobs and investment and on to the things we want less of, like waste of natural resources and pollution? Where is the investment in Europe's transport network which would literally get our economy moving? Prime Minister Wilson said: ' A week in politics is a long time' . Six months in politics is a presidential era. What will you have to show for it?
The British presidency has been bolstered by the proficiency of the Foreign Office and by its willingness to engage with the European Parliament. It can celebrate progress in some areas like accession preparations and monetary union. But, even here, it is hampered by the UK's indecision in joining monetary union - its unwillingness to take the plunge, its failure even to set a date for a referendum and its complacency in educating UK public opinion about Europe.
Beyond the economic arena why has the Cardiff agenda nothing on the Europol convention, on the energy tax as agreed at Kyoto, on the reform of the EU institutions agreed at Amsterdam? No doubt you have generous aspirations and ample faith. No doubt you have the disciples ready and the church organized. But you cannot wait for the gospel to make its appearance while you are doing a photo call with Nelson Mandela.
In our debate in January I reminded you of the words of Sir Francis Bacon: ' Hope makes a good breakfast but a rather poor supper' . Liberal Democrats in this House expected more of the UK presidency. You may have swapped the politics of the handbag for the politics of the Gucci briefcase. But what is important is less the container than the contents. That great British Labour politician, Aneurin Bevin, once accused his opponents of putting flamboyant labels on empty luggage. Unless much is achieved in the coming months, those words may yet rebound upon his successors.

Moreau
Mr President, inclusion of the employment problem on the agenda of the summit in Cardiff tells us that we can no longer ignore the social and democratic needs that manifest themselves in our countries. Whilst we have been told for decades that prosperity abounds, our peoples note with bitterness the continuing encroachment of unemployment and poverty. What is good for the financial markets is not good for them.
I shall confine my address to the recommendations concerning employment and growth, which mark a leap forward that we should greet with enthusiasm. But they are gripped in the vice of the single currency market which seeks to lower the cost of labour and public expenditure. This is why the measures incorporated in national plans oriented towards adaptability, in other words flexibility, or even deregulation, take precedence. In our opinion, we should follow a different direction, giving priority to social viability rather than financial viability, thereby giving the lead to human development and replacing competition with cooperation.
Some of the measures proposed by the Member States foster this approach. Thus, in France and Italy, we have a commitment to reduce working hours. In France too, jobs for the young. At European level, we have the EIB decision to introduce subsidized interest-rate credits for jobs. To this end, we are proposing three series of measures to promote genuine competitiveness based on sound premises. Firstly, of course, a reduction in working hours without loss of wages, but also upward harmonization of welfare protection legislation, the development of lifelong training and the organization of qualifying courses, vocational routes and the promotion of public services.
We propose financing resources to alleviate corporate financial overheads, not loan charges. Mr President, you spoke of red tape. Or course, such bureaucracy exists, but what a burden financial charges impose on company accounts. This is why we are tendering the notion of a selective-rate credit policy for employment, a method of taxation that militates against speculation with the Tobin levy, a democratic check on public employment assistance to ensure that they do not lead to lay-offs, firm action against social dumping and relocation, now even more urgent following the campaign against child labour. We believe that the margins allowed in the current financial year should foster social progress rather than be devoted exclusively to cutting public deficits, which hinders growth and therefore public revenues. Finally, new rights, real powers for workers, their trade unions and the citizens at large must be established. European works councils, for example, must have the power to intervene rather than simply the right to be informed.
We believe that these proposals face up to the major challenges of our day. We think that awareness is growing, where misfortune is not fatal. And our group intends to make a contribution by relaying the social movement to the European Parliament.

Wolf
Mr President, Mr President-in-Office, as I listened to your speech I thought of the saying from my country: "Nimm dir nix vör, dann slei dir nix fehl' - in other words, if you never try your hand at anything, you'll never have any failures! There has been an abundance of subjects for initiatives and events during your Presidency, as Mr David has said. I would be happy to contradict Mr Provan on the matter of implementation, but the longest lunch was an implementation disaster! Let us take the convention on arms exports. I congratulate you on seizing the initiative, but the results are nothing to be proud of. There was nevertheless an agreement on annual meetings and we can only hope that there we will be able to make appropriate improvements and arrive at binding multilateral regulations.
My impression is that there has been a great deal of fuss about speeding up procedures, but at the expense of political substance. The Presidency also carries some of the responsibility for the state of the Union and cannot just settle for its skills of packaging and word-spinning. The central problem is simply this: if we want to offer ordinary people something, we have to offer them politics which affect their interests. We have to show them that European politics satisfy their interests better, and geographical lists do not help them. Geographical lists of who is who in Europe will not feed the unemployed, or create jobs, and they will not open up any new prospects either. The British Presidency, as your speech made clear, has no clear project, which of course also means that there is no failure to be recorded. In employment policy, there has been no clean break with the failed neoliberal policy model, which Mr Provan - I can contradict you on this point - has offered here once again. Deregulation, wage reductions, are supposed to create more jobs and stimulate growth at some point and in some miraculous way. You yourself no longer believe any of this!
Luxembourg saw a fall from grace when employment policy was largely confined to labour market policy. France and Italy were left out in the cold. The creation of new jobs by reductions in working hours, a new economic policy, or tax restructuring by means of eco-taxes, none of these is on the agenda. There is clearly the danger that some Member States will revert to the Essen procedure, under the national action plans which have now been submitted. This is a matter in which the Commission, in my view, Mr Santer, has an obvious responsibility: in its evaluation it should spell this out clearly and also demand improvements so that we really do arrive at a binding procedure, and so that the objectives do not just appear on paper but are implemented and supported with measures and not just with philosophical reflections. Nor do we need measures which are already being implemented in any case, or which other bodies, such as local authorities, are supposed to implement.
At the very least, we need an energetic response to youth unemployment, and we are not getting this in the present state of affairs. We are taking very seriously the "no' which the Commission's President has formulated in this case; the misuse of the principle of subsidiarity for the purpose of re-nationalisation fundamentally serves the interests of the right-wing and ultimately its unsavoury representatives. We must join forces against this.

Macartney
Mr President, the President-in-Office said that in two weeks time a very important event takes place. I do not have to remind you that event of course will be watched by the whole of Europe, millions of viewers, when Scotland takes on Brazil in the opening match of the World Cup. I am sure the President-in-Office will join me in wishing the best to the Scottish team.
I applaud his enthusiasm for the Cardiff summit, which follows that event. Perhaps I could make a point that the challenge for us as politicians is to make the Cardiff summit as important to the citizens as the World Cup. You may say that this is a tall order but there are many aspects of the decisions which will be taken over the next year or so which are going to be of profound importance to the citizens. The challenge for the British presidency and the Austrian and every other one that succeeds is acceptability. How do we make the Europe that we are trying to build acceptable to the citizens? I believe the choice of Cardiff as a summit location is an inspired one. The people of Wales demonstrated last year that they were prepared to exercise their democratic right of self-determination and so Cardiff will become the home of a democratic assembly for the first time in its history. The people of Ireland just last weekend voted again for major steps forward in democracy and I believe we are at the beginning of a new development which includes my own country of Scotland.
Before the Cardiff official summit takes place there will also be an alternative summit of some of the stateless nations of Europe who are deriving inspiration from the example of Wales and Northern Ireland, the Irish Republic and Scotland. They will be putting forward an alternative vision of Europe but it will not be confined to questions of constitutional change because we believe there are some very important issues which unite the many peoples and regions of Europe.
I am very glad to see the President-in-Office and the President of the Commission stressing the importance of Agenda 2000. This could have a very profound impact on both the people of Europe and the acceptability of the whole European project. The plea I would make is that whatever comes out of Cardiff gives us plenty of time, in the European Parliament, to study the implications of the outline that is proposed at that time. I know it is a thankless task for the Commission as for the Council but we need to get this one right.
Unemployment, and I could not agree more with the President of the Commission, is the key task which faces us. If we manage to crack unemployment and solve it and produce a growth economy in Europe, then the whole euro project will prove to have been worthwhile. If we fail, people will wonder what it was all about.
Just two last points, the resolution which is before the House tomorrow commends the international criminal court as an important reform which my group has been very active in pursuing, I hope there will be support for that.
The last point I would make in summing up the challenge for the UK presidency and echoing the points made by Mr Pasty and others, is that institutional reform cannot stand still and I believe that it will be a great fillip if during the Cardiff Summit we are able to come up with a common statute so that Members of this House are not discriminated against by nationality. We all should have the same terms and conditions; we were elected on the mandate.

Muscardini
Mr President, Minister, in this Chamber we have celebrated the single currency. When will we be able to celebrate achieving political union, the only way to make Europe no longer just an area of free trade, run by individual countries and their interests or by certain multinationals, but a true citizens' Europe with common objectives and a more certain and peaceful future?
At the Cardiff Summit we urge that some concrete progress finally be made towards the achievement of political union, and for this reason the debate must be opened on reorganizing the European institutions: certainly more decision-making power should be given to the European Parliament, but we also need to identify a body that can represent all the Member States, initially at least, for matters relating to common defence, the fight against major crime, the defence of twenty million unemployed and forty million new poor, a body which may also begin to consider how to craft the Union's foreign policy. Indeed the Council of Ministers represents the individual governments and does not represent a common European will.
Today, in the absence of this body, foreign policy should be determined not only by the Council but above all by the European Parliament, the voice of Europe's citizens. The fight against major crime can never be achieved if Europol, for example, continues to be blocked by the failure of the Member States to achieve a coherent view. If Cardiff turns out to be a carbon copy of the other Summits or makes absolutely minimal progress, we risk having a Europe no longer made up of citizens who see hope in the euro, but of citizens who at the same time worry about a lack of political direction that gives the economy certain objectives to be achieved: in fact, the lack of political direction even makes economic recovery very uncertain.
It is not enough to say that Maastricht imposed stability and that stability now enables the application of rates which are clearly lower than before if we then find banking systems in the various Member States which operate in some cases in a way that is completely different from what we declared with so much enthusiasm and emphasis in this Chamber on 2 May. If the lack of political union risks, because of the electoral results of one country or another, bringing back the cyclical problem - Europe exists or does not exist as a supranational entity or it is not always...
(The President interrupted the speaker)

President
I have received five motions for resolutions pursuant to Rule 37(2) of the Rules of Procedure.

Titley
Mr President, I would like to begin by personally congratulating the President- in-Office on his success in achieving a code of conduct on arms exports. This code of conduct establishes some important principles which represent a major leap forward in the EU's contribution to peace and stability in the world. The code of conduct will also provide a clearer framework for the rationalization of the European defence industry, which in turn will lead to the greater interdependence which will make national undercutting obsolete in the future.
I would also like to congratulate him on the way he has never failed to take forward the human rights agenda during his term as President-in-Office. In particular, the success he had in taking that agenda to the Chinese and moving forward the Chinese agenda has been one of the successes of this presidency.
Clearly the major success has been carrying forward the Luxembourg conclusions on the enlargement process. Not only was the very complex negotiating process begun on time but the European conference was launched in such a way as to ensure that it immediately got down to discussing matters of direct relevance to the European citizens, particularly drugs and crime. These were considerable achievements but it is important, now we have launched the process, we do not allow other political priorities like a single currency to push enlargement into the background where it would be in danger of becoming bogged down in technical discussions.
So it is important, in my view, that the Cardiff summit sends out a number of clear messages. Firstly, it should send out a clear signal of our continuing political commitment to the enlargement process. Secondly, it should reiterate the Council and the Commission's commitments to keeping the Parliament informed of the enlargement process and of recognizing the important role the Parliament can play. I would to commend to future presidencies the meeting that Mr Henderson held with the bureaux of the joint parliamentary committees as a way forward.
Thirdly, we have to assess the progress which has been made on the screening of the acquis and on the evolution of the pre-accession strategy. I would hope that special attention can be played to the social dimension in central and eastern European countries which is of particular importance. We must ensure that the Commission's first annual report, which is foreseen for later this year, is on time and on schedule.
Finally, as other speakers have said, we must take forward the Agenda 2000 proposals because it is very important if we are to keep enlargement on track that we complete the legislative procedures before June 1999. Therefore we have to have political agreement by the Vienna summit.
Elsewhere, I would congratulate the British presidency on taking forward the Luxembourg conclusions on the Middle East peace process. The Socialist group recognizes the tremendous efforts made by the British Foreign Secretary and the British Prime Minister to restart that process and to carry out the conclusions of Luxembourg, particularly in drawing to the attention of the Israeli Government the lack of wisdom in proceeding with these settlements and of the need to develop economic strategy on the Palestinian side.
Finally, I would hope the Cardiff summit looks forward to the Bosnian elections. This is another step in the process of peace and stability in the former Yugoslavia and I would hope that we will support those elections to the fullest.
I would compare the presidency of the European Union with the British Grand National, or the Derby. It is important to success to be able to finish the race. It is even more important to success to finish, as the British Government is doing, in style and with panache and with still something to spare in the tank.

Hernández Mollar
Mr President, the current context for employment policy debates is obviously not the same as in previous years. Monetary union is now a reality. The national employment plans have now been presented, and economic convergence has created a climate of confidence, which is encouraging for the growth of employment. This presidency has had the luck to come at the end of a long process in the construction of Europe. Some countries, such as Spain, having adopted rigorous economic and social policies, are already seeing the results of their governments' actions. The formulae for creating employment - which will always be better than sharing it out - have been stated and repeated often enough, from the Essen Summit to the one in Luxembourg.
Mr President-in-Office of the Council, we are on the threshold of the twenty-first century. The technological revolution, the globalization of the economy and the large markets demand that Member States make a great effort in the field of education and training. Being able to guarantee jobs depends on qualifications and training, and also on educational establishments awarding professional qualifications which meet the demands of the labour market.
I also want to emphasize how essential it is to ensure that social dialogue provides the context for updating the organization of work, as regards job stability, lifelong training or the reorganization of working hours. For example, I do not think it is right for governments to decide to reduce the working day. In fact, it is the actual dynamics of a company's productivity or size which can provide a guide, enabling workers and management to come to an agreement on such matters.
Finally, Mr President-in-Office of the Council, the whole of society needs to be involved in creating jobs. The employment plans presented by countries such as Spain and Italy emphasize that regional or local authorities also need to be given responsibilities here. The employment services should adapt to the needs of management and workers. They should also scour the new sources of employment for opportunities to provide jobs for the people desperately looking for work.
Unemployment and under-employment lead to exclusion, poverty and despair. People have heard enough speeches and promises. The euro and the employment plans are a way of turning people's right to work into reality - their right to work in that society of prosperity and solidarity we all want to create in this new Europe we are building.

Collins, Gerard
Mr President, firstly I welcome the opportunity of congratulating the United Kingdom presidency on its success on behalf of all of us in the European Union. I wish them continued success for the next couple of weeks and that Cardiff will be like the finishing of the Grand National, as was said by Mr Titley. The fact that the President-in-Office is red-haired does not in any way mean we should compare him to Red Rum who was one of the best stayers on the Grand National course. If my memory is correct, he won three times in all.
I should say that the United Kingdom presidency brought with it great enthusiasm, energy and a high quality of organizational ability which we all very much appreciate. In particular, I am glad that at all times they fully respected the role of Parliament and its Members. I would like to thank the United Kingdom Government and its Prime Minister for their tremendous effort in guiding the peace process in my country to where it is at the present time. As everybody knows it received massive backing by all the people on the island of Ireland only last week. The summit meeting in Cardiff provides an ideal opportunity for the European Union to assess how best it can aid the process of peace and reconciliation which was given this overwhelming support by the Irish people and the referendum. The Union has given considerable political and practical support to this process over the years and I very much hope that the British presidency will ensure that the important developments of recent weeks are given due consideration in Cardiff.
Recently, the Commission put forward a package of proposals which, amongst other things, called for a reform of the CAP, the Structural Funds and the entire budgetary policy of the Union. The summit should concentrate on elaborating broad political guidelines concerning this package of proposals which will have a major impact, not just on the functioning of the European institutions but also on the daily life of the citizens over the coming years. It is important, for example, that European leaders reaffirm their commitment to the central role of the family farmer in agricultural and in rural development policy. Any reform of the CAP should be geared towards preserving and encouraging the continuation of the family farm as the foundation of the European agricultural sector. It is equally important that the reform of the CAP should be considered in parallel with the reform of the Structural Funds because an essential component of structural policy throughout the Union should be the preservation of present population levels in rural areas and in the relatively isolated areas on the periphery of the Union. This can only be achieved by recognizing that agriculture will continue to play the pivotal role in rural areas for the foreseeable future and that structural policy should be geared towards the maximizing the development of allied sectors such as agri-tourism, food processing and the preservation of environmentally sensitive areas.
Finally, again I say to the UK presidency: keep up the good work, two weeks left and remember the last hurdle is also an important one to negotiate before you successfully make the finishing line which I am sure you will.

Ojala
Mr President, when national leaders meet in Cardiff, public interest will clearly focus on how unemployment can be reduced and what is going to be done about it in practice. It is good that we will in future be able to assess employment schemes better than before. We need reliable and comparable data, for example, on whether unemployment among young people and the long-term unemployed is coming down in EU countries. Merely examining national programmes will not necessarily be sufficient to tell if the strategy for growth and employment is working at the pan-European level. I believe we need a European contribution to programmes to reduce long-term unemployment and unemployment among young people. There should be a principle arising from the Cardiff summit that the creation of new jobs in the Agenda 2000 programme should provide a more important basis than it does now for the granting of assistance by the EU. The success of an active employment policy is ultimately the yardstick by which we can gauge whether Europe can solve the mass unemployment crisis of post-industrial society.

Lukas
Mr President, in the short period of six months it is hardly possible for a Council Presidency to have a strong impact on the European political process. That is why continuity and cooperation between successive presidencies are all the more important. However, our citizens are given the impression, conveyed in part by national media, that each Presidency functions in historical isolation. Every six months Europe is invented anew, so to speak. My question to the British Council Presidency, therefore, as an Austrian Opposition politician, is this: in July, do the Austrians start again from scratch, as seems to be the case, or is there genuine co-operation between the British Presidency and the future Austrian Presidency which will ensure that processes already begun will continue to run smoothly? If the answer is yes, in which areas is there agreement, and where can Austria build on preparatory work by Britain?

van Velzen, Wim
Mr President, when the Presidency announced that it already intended to review the plans for employment in Cardiff, counting myself among the sceptics, I thought that rather precipitate and even unkind to Vienna, where the process would have to take place. Now that I have a clearer picture of the situation, I am actually extremely glad that the Presidency did that, thereby giving an extra boost to the process of the Luxembourg Summit. When you look at what has now been achieved by the Member States since the Treaty of Amsterdam and since the Summit, you see that it is in fact many times greater than what everyone expected then. I myself was afraid that the response to the Presidency would have been: we need more time, just wait a while. The situation now is that they have all done their job. However that does not mean that we are already there because, when you come to assess the plans, there are still a lot of points to consider. I hope that a contentbased approach will be adopted in Cardiff. Too many Member States are sitting back and taking the attitude that the guidelines apply to the other Member States, but they are measuring up. That is nonsense. Not one Member State can claim that it already conforms to all the guidelines.
I would point out that those national plans must be more than a technical operation in which sheets of paper are neatly filled in; they must focus on the quality of measures taken, on renewal and reactivation. Also it must not be possible for Member States to pick out two pillars from the four that have been decided and leave aside two really important ones, namely equal opportunities and adaptability, in order to concentrate on re-employment or employability and entrepreneurship. The last two, for me, smack too much of attitudes on the lines of: you are out of work and you only have yourself to blame for that. You should be more employable . Or, do not be so apathetic, go and set up a business! I think the other two are immensely important to the Member States, because they challenge the responsibility of the Member States and the social partners. It is not by chance that these two have been disregarded up to now.
One last point. Both Amsterdam and Luxembourg focused on a balance between a macroeconomic policy approach and an active labour market policy. Up to now there has been no real content-based consensus. Another feature of the process is that different Directorates-General and different Councils are dealing with those matters. I call upon the Presidency to take a first step in Cardiff towards joint action by the various parties involved, in both preparation and decision-making.

Schiedermeier
Mr President, during this discussion, as the Chairman of the Catholic Workers' Movement in the Regensburg Diocese, I have found myself thinking of something that Cardinal Cardyns said: every single young worker is worth more than all the gold in the world. This is an old saying, but its message is still relevant. Jobs are important, but hitherto there has been too much talk, and here I would agree with my colleague Wim van Velzen, and not enough success.
Now there are action plans. I only hope that they will be implemented quickly and successfully, otherwise even the best action plans will be of no use. Best practice is fine, but I hope that it is quickly adopted in those countries which have not hitherto adopted it. We are always hearing about assistance to SMEs but no Council Presidency and no Commission has yet been able to ensure that small and medium-sized enterprises have simple requirements so that they, too, can put them into practice. Taxation and welfare systems should bring about a reduction in accessory costs to wages, but they must also be fair so that employees do not again bear the burdens alone. Structural reform, Agenda 2000 - Commissioner Santer, rural areas seem to me to have been treated very shabbily in this goulash Objective II. Something more has to be done in this area.
As regards the environment, allow me to say that we need both people and nature, and not nature without people! I also have a question about the operation of the own resources system: why do we have no money for computers when at the same time we are giving away billions of marks in own resources? Perhaps for once you could do something about this. Please implement the social market economy as quickly as possible in the new accession countries so that we are not confronted there by problems which are the same as our own. Do not forget subsidiarity even if as a central government you sometimes are not so happy about it!

Andrews
Mr President, I would first of all like to thank the British presidency for their participation in the peace process in Ireland. As far as Mr Blair is concerned I believe he is the first British Prime Minister ever to make Ireland a priority. I would like to thank the British Government for rejoining Europe because we badly need them in Europe.
I and many Members of this House admire very much Mr Cook's stand on the armaments industry and control. I want to pay tribute to him on that.
In Yugoslavia, Slobodan Milosevic still remains in situ in former Yugoslavia and he has much to answer for. The European Union stood by and watched the genocide in Yugoslavia; I hope we will not do the same in Kosovo. We must call Milosevic's bluff. I admire Mr Cook for his condemnation of the slaughter in Kosovo. I know Robin Cook is a moral man and is sincere in his condemnation of the slaughter and ethnic cleansing in that country. He is, of course, outraged as we are in this House at what is happening there. We must stop the Serb minority in Kosovo. I also hope that he will raise the issue of East Timor at some stage as a matter of urgency, perhaps in Cardiff. The horrors of Algeria and the lack of response from the government in Algeria to an independent human rights Commission to visit Algeria to see what is happening there is something that should also be raised. I want to congratulate the British presidency. It has been a marvellous presidency and I want to pay tribute to you personally, Mr Cook, for your courage in taking on very major issues.

Papayiannakis
Mr President, the motion for a resolution which I support contains a number of proposals to promote employment. However, there are a number of points which need to be retabled and emphasized. I refer to the reduction in working hours, which the thirty-five hour week merely symbolizes. We all know that, if there are no accompanying measures, companies will easily be able to use leading-edge technology in order to make up the hours lost. Perhaps, therefore, we need to discuss more drastic reductions in working hours.
I would also like to highlight the emergence of new professions which meet real social needs but which are not recognized on the work market. These could be promoted by providing healthy financing, as suggested in the Delors White Paper or as introduced on an experimental basis by the French government.
Lastly, Mr President, we need to retable the question of investment in the famous trans-European networks which would, we were told at the time, lead directly and, more importantly, indirectly to new jobs throughout Europe. This plan has been undermined by ministers of finance in Member States throughout the Union, some of whom will most likely attend the Cardiff Summit, Mr President, without giving so much as a second thought to the contradiction which that represents.

Donnelly, Alan
Mr President, I warmly welcome the reference Mr Cook made to the need for economic reform. Many of us in this House believe that, in completing the process of Economic and Monetary Union, it is now very much the job of the European Union to turn its attention to economic reform. With the euro area accounting for around 20 % of the world's output and the world's largest importer and exporter, it is essential that we have economic reforms within the European Union that are going to make the single currency a success.
Our shared task is to ensure that our economies work not only effectively but in a way that combines economic dynamism with social justice. It is essential that in Cardiff the presidency and the heads of government launch a new European way in bringing about economic reform. This must address the issue of pro-enterprise and a pro-opportunity agenda with measures to encourage enterprise combined with policies that ensure economic employment and educational opportunity for all, building on our long-standing strength of stability and cohesion.
This Parliament strongly supports an economic reform agenda balanced with the process of monetary union. The Socialist group has identified three specific areas which I hope the President-in-Office will take with him to Cardiff. The first is the reform of the labour markets. Europe has 18 million unemployed and while 10 % of the unemployed in the US have been unemployed for more than a year, nearly 50 % of Europe's unemployed are long-term unemployed. The US is more successful at getting its long-term unemployed back into work. We need a new way, recognizing that in a fast-moving world of constant innovation and technological change, governments can help to equip people to cope with inevitable change. While there is far less that government can do to stop people losing their last job, there is a lot more that government should do to help people gain their next job.
We are very concerned about the capital market and there needs to be capital market reform. The US has a huge capital market and equity market to help in venture capital. Europe has a fragmented and inadequate equity market. We need to make sure that there is venture capital available for small and medium-sized enterprises. In Cardiff it is essential that we start the process of building a Europe-wide equity market for venture capital and for investment.
The third area which needs reform is in the product market. We have a single market but it is still fragmented. We still need steps to build the internal market of the European Union. Cardiff is a marvellous opportunity to accept the process of monetary union and to begin the important and essential job of economic reform. If that is the aim of Cardiff, Mr Cook has the full support of this House.

De Giovanni
Mr President, Amsterdam is still being ratified but already we are beginning to talk about institutional reforms again. I must say that I was very happy to hear, today, both the President-in-Office of the Council and the President of the Commission recall the importance of institutional affairs for the future of the European plan; moreover, signals have also been coming from beyond the official institutions: various personalities - from Jacques Delors to our President Gil-Robles, to the President-in-Office of the Council, Mr Blair, a few days ago - have expressed concern about the difficulties that may arise with the Union's decision-making mechanisms in an enlarged Union.
I do not want to go into the merits of these reforms here or voice any opinion on the matter; I just want to try and understand why we are returning to the subject of the institutions, with Amsterdam still in progress. In my view it is for one fundamental reason: because the challenges facing the Union require these institutional reforms. The challenge of monetary union: monetary union is pushing us towards political union - no one denies that - but we are in great need of a political-institutional will, because nothing in history happens automatically. And then enlargement: no one has any real doubts about the institutional consequences of enlargement, because it is clear that the emergence of two types of Europe is possible: a much more diluted Europe could be formed, very similar to a large market, and there could naturally be a political Europe. That is therefore the reason why institutional reforms are increasingly unavoidable, whatever their merit.
How should we proceed from there? That is what I would like to say briefly in the second part of my speech. There is a resolution of the European Parliament of November 1997. We propose a particular route: we ask the Commission to produce a document on the institutions before the end of the year, and we ask the Commission to do this because we respect its role of initiative and because we consider that the role of the institutions is fundamental in resuming the debate on them. And we ask the Council to give the Commission a mandate for this initiative.
That is the fundamental point! Once again I will not go into the merits, but I'd like to recall that only by clearly defining a relationship between institutions and the objective to be achieved can we respond to the question of Europe's future, what kind of Europe we want, what plan we want to achieve. I think it is extremely important that this Parliament send a message to the future Parliament - the Parliament which will be elected in 1999 - a message that there must necessarily be innovations to the institutions.

Roth-Behrendt
Mr President, Mr Santer, colleagues, there have been several treaties - the Maastricht Treaty, the Amsterdam Treaty - in which we have repeatedly expressed a commitment, for example in Article 6 of the Treaty of Amsterdam, namely the demand that environmental policy and protection should not only be included, but should also be a high-level objective in determining and implementing Community policies.
I have been in this Parliament for nine years. I know what we say we will do, but I also know what our achievements are. What we say we will do is always splendid, and the British Presidency's achievements have been outstanding, but now, in common with this House and also, I hope, with the Commission, Mr Santer, I have high expectations as regards the Cardiff Summit. If it is our conviction - and, as far as I know, it is the conviction of the British Presidency - that environmental policy is an important Community objective for the people of this Union, and if, at the same time it is our conviction that fighting unemployment is the most important task that we have to face, we should be sufficiently intelligent to link these two objectives. If we can prove - and we can do so - that environmental policy, higher environmental standards, new environmental standards, developed with the Commission, with the European Parliament, but also with our partners in industry and the trades unions, that these new policies can create jobs, that is what we have to do. Are we doing it? No, we are not!
Unless we finally start to incorporate environmental standards and protection and the checking of environmental compatibility and sustainability into all other Community policies, we can forget all the other speeches here. Then Mrs Bjerregaard can give up her work, I can do the same, and so, too, can large parts of the Union too. So we have to change things. What will we change? We must have binding framework legislation which says that environmental policy is part of transport, energy and economic policy, as Mr Donnelly has already explained.
It is no longer enough for this to appear in Article 6 of the Treaty. I am tired of reading treaties - I have done so long enough as a lawyer - and I also know what they can amount to. I would like to see the Commission being supported by the Council Presidency, by you, Mr Cook, by the British Council Presidency and by the new German Government after 27 September of this year in ensuring that the integration of environment policy into other Community policies is obligatory. I would like to see a binding commitment to this end, that means I would like to have from you, Mr Cook, and from the Cardiff summit an obligation on the Commission to submit framework legislation, and I do mean legislation which imposes an obligation, not another meaningless commitment!
In conclusion, allow me to say the following. When I was a child, I liked to play with soap bubbles. You can blow them up and they get really big, they shimmer with all the colours, they're very impressive, then they lose their colours, burst and disappear. I have no desire to see yet another summit lose its colours, burst and disappear. Please, Mr Santer, please, Mr Cook, make sure that after the Cardiff summit we have obligatory legislation and that environmental policy is an integral component of all other Community policies!

Schulz
Mr President, President of the Commission, ladies and gentlemen, I am the last speaker in this debate but I hope that the topics that I shall address will be placed high on the Council's agenda. I would like to make two requests, to you, Mr Cook, and to you, Mr Santer, two requests to take an urgent inquiry from the European Parliament with you to Cardiff. Fighting organized crime is one of the absolute priorities of the Council and of the Commission, and also of the work of the European Parliament. We know that wherever it is possible to do business without frontiers, it is also possible to do illegal business without frontiers. That is why, as a strategy to counter the freedom of having no frontiers which those who are able to misuse our economic system enjoy, we also need cooperation, which as far as possible is not affected by frontiers, between the police and our justice systems whose role it is to pursue the criminals who operate their network on a panEuropean basis.
The trouble is that this process, which can be so compellingly described, is not advancing as fast as the European Parliament would like. In our view, this is in part due to the fact that, after the finely turned phrases of the summits on European integration have faded away, an integration which must of necessity be implemented in areas of the third pillar as well, the national sovereignty reserve, especially in the case of police and justice co-operation, weighs more heavily in the balance than the pragmatic necessity of co-operating at the European level. That is why I want once again to formulate precisely the European Parliament's request which is contained in innumerable resolutions, and which was drawn up by us specifically in relation to the initiatives and the common measures subsequent to the report from the high level group on fighting organized crime, the request which is expressed in these opinions: show greater courage and go beyond the level of national governments; do more to remove obstacles especially in the case of cooperation between the police - but also between justice systems, which is no less important. Show greater courage as the Commission and demand of the Council that more competence and authority under Community law for fighting organized crime should be transferred to you!
I consider that one of the top priority tasks in the immediate future is that we should learn to integrate Europe not only in the economic sphere, and that we should learn to organize the instruments that we need to fight misuse not only at the national level. Unless we remedy this divergence, organized criminals in Europe will continue to have an advantage over the police.

President
That concludes the debate.
The vote will be taken tomorrow at 11 a.m.

Common foreign and security policy for 1997
President
The next item is the report (A4-0169/98) by Mr Spencer, on behalf of the Committee on Foreign Affairs, Security and Defence Policy, on the role of the Union in the World: implementation of the common foreign and security policy for 1997.

Spencer
Mr President, under the Treaties we are required as a parliament to hold an annual debate on the development of the CFSP. My report discharges that duty in the same format as we did last year. There is a tabular comparison of the details of the use of joint actions, common positions and declarations over a four year period. There is a review of the CFSP on a regional basis, starting with our near abroad and moving outwards.
There is nothing of particular interest to note in the use of these instruments other than their continued failure to address the real challenges which Europe faces in the world. In fact, in 1997, apart from the Amsterdam Treaty, the most interesting thing to happen was the interinstitutional agreement on the financing of the CFSP and on parliamentary involvement. That involvement is going to depend for its effectiveness on good cooperation between the Committee on Budgets and the Committee on Foreign Affairs, Security and Defence Policy. Also, from that agreement, flows the commitment from the Council to provide us with a document on 'the main aspects and basic choices of the CFSP' . That is a minimalist document stripped of meaning by pre-publication editing in Council working parties. It is historical, it is narrative, it devotes only a page and a half to the future and then in the vaguest of terms. It needs to be improved next year.
Observant colleagues will have noticed that we have changed the title of this year's debate to 'the role of the Union in the world' so that we may look at the whole period to draw lessons from the past and project them into the future. Europe's role in the world is more than just the limited and, as yet, undeveloped activities covered by the CFSP. It encompasses the commercial and other competences of the Commission, the role of this Parliament, its presidents, committees, delegations. It must also encompass the foreign policies of the Member States. As I say on page 9 of my report, we are creating a common foreign policy, not a single foreign policy. The parallel with the common currency and a single currency may be instructive if not exact. A common policy magnifies effective influence. A single foreign policy would be the product of a single state which the Union is not.
In my view we should be striving to maximize Europe's influence in the world for our own good and, I would argue, for the good of the world. To do so we should use all our resources in all the institutions and in the Member States. The period of 18 months that we are looking at covers three presidencies conducted in three very different styles with three very different degrees of experience. I can assure the President-in-Office that I am not going to engage in either the public puffing of the presidency by Mr Cook's PPS and sous-chef Mr Titley, nor indeed, Mr Provan's public pricking of the presidency's pretensions. I am going to stand back and look at all three of those presidencies as regards common foreign policy. And I have to conclude that it is currently impossible to run an intellectually or politically satisfying presidency, given the tensions between the current institutional structures and the overblown and ambitious rhetoric of the CFSP itself.
Time and again we see Europe accepting that the real decisions are taken by the Americans. We tamely follow them around, voting funds and troops into situations such as Bosnia where we have abdicated from effective decision-making. They say and we pay. That is not good for them and it is not good for us. An optimist would say that post-Amsterdam the CFSP is in transition. Surely the position will be improved when, instead of sending the President-in-Office on a one-day administrative errand to Ankara which fails to persuade the Turks to turn up even to their own association council, we could instead send the High Representative. Surely the existence of an analysis and planning unit would improve our state of preparedness. At the moment we manage to be ill-prepared not just for the predictable, such as the Indian test, or the perennial such as Saddam Hussein, but even for the frankly overdue such as Kosovo.
At the moment we have the worst of all worlds. We are too proud to hand over Europe's interests lock, stock and barrel to Uncle Sam. We are too vain to remain decently silent. We have too much memory and not enough vision to create our own foreign policy. So, what do we settle for? A peacock diplomacy that is for display and not for use. The prime role of this Parliament and the foreign affairs committees of national parliaments is not to control the executive in their conduct of foreign policy. It is to encourage them to have a foreign policy worthy of the name in the first place. To have a Europe which is impotent in the Middle East peace process, silent on the sub-continent and sidelined in the Balkans is quite simply not good enough for the European Union. I commend the report of the Foreign Affairs Committee to the plenary.

Cook
Mr President, I should like to respond to Mr Spencer's observations and may I say to him straightaway that there are formidable problems in forging a common foreign and security policy. I fully understand the frustration which he has very well expressed and I can understand that must be a frustration that is widely shared throughout the European Parliament. It does not help us, however, to come to terms with our sense of frustration if we do not understand the very formidable problems that are engaged in forging a common foreign policy among fifteen Member States who have different histories, different historical ties born of those histories, who have different linguistic and cultural links to other countries which bring them with different attitudes to conflicts around the world, who have today different conflicts with neighbouring countries which are not shared necessarily by all the other fifteen.
That is why when we meet in the General Affairs Council it is not unusual - as we found on Monday on two occasions - for one country to be standing out against the other fifteen. It is not always the same country. I am not seeking to particularize or to put any individual blame on any one Member State. From time to time most Member States sometime or other say that this issue is of fundamental importance to us and we cannot achieve a consensus that the other fourteen can agree on. I want to put it to Mr Spencer that the problem and the frustration which arises from it is indivisible from the assumption that each Member State has the right to maintain its own foreign policy as an attribute of the fact that it remains a nation state in its own right, with its own participation in international forums. Mr Spencer's party is not suggesting that we change that principle nor, frankly, are the governments that are represented in the European Union, members of whose parties are here in the European Parliament.
Therefore, if we have recognized that starting point, we have also to be realistic about what can be achieved on a common policy starting from that particular difficulty. I am entirely prepared to accept as a broad caveat on our common foreign and security policy that we are seeking here to forge common positions among fifteen Member States who may not approach each problem with the same perspective, the same historical background or, indeed, the same pressures of public opinion. If the European Union is to be a success we have to make sure that it has the flexibility to recognize the differences of history, culture and public opinion.
Against that background and with that very large qualification, I would submit that if one looks back over recent months, there is much that the European Parliament and the Council can take satisfaction in, having built common positions, built a common approach to the world outside and upon occasion - because we had that common approach - making an impact. If I might start with the agenda of human rights and democracy which is high on the agenda of our own domestic policy in Britain and has therefore been high on our agenda of the presidency, it is the case that on Monday we achieved agreement on a code of conduct on arms exports. That code of conduct represents two significant steps forward. It establishes common standards by which each Member State will judge applications for a licence for an arms export. The nations of Europe will certainly still compete against each other for these orders but they will compete against each other on price and on quality. They will not compete against each other on standards of observance of human rights.
Secondly, that code includes a notification mechanism by which any Member State can notify all the others that it has decided to turn down a contract on grounds of human rights and any other Member State who wishes to pick up such a contract must first notify and consult the country that first refused it. That is an entirely new mechanism which can give some confidence to Member States that if they turn down a contract on grounds of human rights, democracy, or concern about fuelling aggressions, no other partner is going to take advantage of their decision by picking it up or, at any rate, cannot do so without first telling them, which will be an effective deterrent.
I do not think that the code is perfect. If I may say so, I regret that it was only possible for us to get consensus on the code by dropping some of the objectives we had for achieving transparency. I am prepared to think Mr Spencer and others would be perfectly entitled to voice criticism of that code. But in voicing that criticism we should not overlook the fact that it represents a significant step forward. One of my domestic critics said I have only got half a loaf but I should at least be congratulated on having got half the loaf. That may necessarily be the condition in which we take forward a common policy among fifteen Member States.
Secondly, Mr Spencer refers to my visit to Turkey. The problem we have in Turkey is not actually a problem we have in Europe. Europe is ready for an association council with Turkey. Turkey has taken the view that it is not ready for that association council and that is a view we must respect. Turkey is not a member of the European Union. It is not a party to the common foreign and security policy. It is not part of any internal discipline that we may ourselves have as Member States of the European Union. I think Turkey made a mistake. There is a chasm between us which it would be important for Europe and for Turkey to bridge but we cannot build that bridge simply from one side of the divide. Turkey must also assist us by being willing to build a part of the bridge from their side of the divide as well.
I would also report to the European Parliament that while I was in Ankara I visited Akin Birdal, the chair of the human rights association, on whom there was an attempted assassination two weeks ago. I found Mr Birdal in amazingly good spirits and in a state of courage and determination that I found both inspiring and humbling. Mr Birdal was shot at close range and had fourteen entry and exit bullet wounds. When I saw him only seven days later he was sitting up in bed, lucid and determined and expressed to me the view that it is people like him who are urging the path of human rights and good governance and open transparent democracy in Turkey and putting Turkey on the true European path. That is a view which everybody within the European Parliament would surely wish to echo.
I would also like to pick up the observation made by Mr Spencer about our role in the former Yugoslavia. I would put it to Mr Spencer that he undervalues what has been achieved in the last year. There has been a significant shift in Bosnia towards implementing the Dayton process. When I was last in Sarajevo earlier this year the Foreign Minister of Bosnia said: ' Nobody won the war, we all lost the war' . It was a statement that was absolutely and plainly true but it is also a statement that no senior Bosnian politician would have made until the last few months. There is now a sober recognition across a large part of the political community in Bosnia that the way forward is to accept the Dayton agenda of ending ethnic confrontation rather than trying to recapture the ground that each different ethnic groups feel they lost during the years of conflict.
Europe has played an important part in that process. Firstly, we played an important part in that in the recent months we have shown a renewed robustness towards the war criminals. In my own strong view there can be no meaningful reconciliation and ethnic justice within Bosnia unless those who were responsible for the worst atrocities in the conflict are seen to be brought to justice. I am pleased to say to the European Parliament that because of that robust approach we now have half the indicted war criminals awaiting process before the tribunal. This is something we would have had difficulty hoping for a year ago.
Secondly, Europe has made a major contribution through the High Representative in enforcing open and fairer standards of access to the media. It was the robust approach which the High Representative took towards television within the Republika Srpska that played a very important part in the election of a government in Republika Srpska which, for the first time, since the end of the conflict is now committed to the Dayton process and in taking it forward. As the presidency of the European Union, I was the first foreign minister from outside Bosnia-Herzegovina who had the opportunity of addressing the assembly of the Republika Srpska and encouraging them on the path towards ethnic reconciliation and towards implementation of the Dayton process.
So there is progress within Bosnia - slow progress, inadequate progress - but there is progress which is in part a result of the work of the European Union, of the Council and of the Commission who have responded to the election of that new government of the Republika Srpska by packing it with additional resources and aid. The problem in the former Yugoslavia is that the two neighbouring countries to Bosnia still remain countries dominated by politicians who often do not appear to have the commitment to the Dayton process one would expect from people who signed the Dayton Agreement.
In Croatia the Council has condemned the repeated failure of President Tudjman and his government to make more serious progress towards refugee return. That is why at the most recent General Affairs Council we requested the Commission to review whether Croatia can retain its autonomous trade measures while it continues to be in default of its commitment under Dayton. In Belgrade the Federal Republic of Yugoslavia is still dominated by President Milosevic whose conduct towards Kosovo has dominated so much of our international discussions over recent months. I regret to say that all our efforts at those international meetings both at European level and at contact group level have as yet failed to produce stability and an end to the violence in Kosovo. Indeed, the violence in recent days has been particularly acute. Several villages have been destroyed and there has been a sharp increase of several hundred refugees a week now seeking refuge outside Kosovo across its borders with Albania and with Montenegro.
The great tragedy of this situation is that the only people who are benefiting from the conduct of Belgrade within Kosovo is the Kosovo Liberation Army for whom President Milosevic is the best recruiting sergeant. I welcome the fact that Belgrade and Pristina are now in dialogue but I have great doubts as to how successful that dialogue can be against a background of continued violence. President Milosevic has engaged in dialogue but that engagement is unlikely to be successful while he continues to use violence against the Kosovans themselves. For those reasons, the European Union moved fast after the contact group decisions to put in place a battery of measures against Belgrade - an arms embargo, a visa ban, a freeze on their assets outside the Federal Republic. Those measures are now fully in place and Europe put them in place within ten days of the contact group meeting.
But there is also another side to our dialogue with Belgrade and that is our repeated willingness to end those measures and to offer to the Federal Republic the same embrace within the European Union we have offered to many of the other countries of the region. The great tragedy for the people of Serbia is that President Milosevic has now left them more isolated than any other country of that region of the continent. I have met some of the younger generation in Belgrade, for instance those who run the B92 independent radio. They are cosmopolitan, forward-looking young people such as you will find in any capital in Europe. It is with them that the hope for the future of Serbia lies. It is important that while we put maximum pressure on President Milosevic, we also make it clear to those who would wish an alternative form of politics that we are on their side and there will be a welcome for them if they can succeed in the internal political debates within Serbia.
I will concede - and it is fair to do so after Mr Spencer's introduction - that we have not solved the problem of Kosovo but I would certainly very firmly assert that, in responding to the Kosovo crisis, the European Union has shown more urgency, more solidarity and has achieved a common position much more rapidly and firmly than it ever did in the early years of Bosnia. Had we shown that urgency and that firmness in the early years of the Bosnian conflict, we might not now be starting to claw back from such a far deeper problem in which we now find ourselves.
I should also like to illustrate the success we have shown in a common position by reference to a number of the other problems of the world beyond our own continent. Tom Spencer mentioned the Middle East peace process. The peace process remains in deadlock. Every Member present in this Chamber must be alarmed at the fact that deadlock remains in place. I have grave concerns that some in the Government of Israel imagine that there are two choices. One is between making progress in the peace process which may be of disadvantage to their interest and the other is status quo with the present deadlock which does not require them to make further compromise. I fear that is a false perception of the two choices. The choice in reality is either we make progress on the peace process or we slip back into confrontation and violence and instability within the region. The status quo is not sustainable in the medium to long term.
But although everybody present has every right to be dissatisfied that there has not been more progress on the peace process, I would robustly assert to Parliament that we have never had a moment in the whole of the last three to four years since the Oslo peace process began in which the European Union presidency has been more engaged in the process. The recent London talks were hosted in the capital of the presidency. Both the Americans who took the initiatives on the package on the table and the partners to the talks throughout those two days met repeatedly with the presidency. Indeed, the presidency can claim considerable credit for having persuaded the Palestinians that they should attend those talks and should accept the American package, thereby putting the pressure on the government of Israel also to accept the package.
The presidency has also provided a security advisor to the Palestinian authority and through our special envoy, Mr Moratinos, we have created a permanent security committee with the Palestinian national authority in which we are directly and in practical terms addressing the security issues. It is the European Union which has put most resources into making a reality of the Gaza airport and it is the European Union and European companies which are investing most in the Gaza industrial estate. If we can get the breakthrough on the question of the further redeployment it will be the European Union that will be the leading party in making sure that both those interim agreements are up and running with very real value to the economy of Palestine.
Similarly we can claim credit for the fact that we have achieved a very successful summit with the United States two weeks ago with a very real breakthrough of immense importance to Europe in that the United States administration has signed with us an agreement on sanctions legislation which explicitly rejects extraterritoriality which is of great importance to us. We now have the basis on which both sides of the Atlantic can achieve a common position against Iran rather than Iran becoming a basis of division between the two powers on the different sides of the Atlantic. On Africa, as recently as last Monday we adopted a common position within the General Affairs Council which stresses our commitments to good governance, human rights and development. This is in itself a very important step forward because, if we are candid, one of the problems that Africa has had, even in the post-colonial era, is the rivalry between European powers who previously were the colonial powers in Africa. The historic achievement we made on Monday is to finally put that cast of mind behind us and to agree that we actually have common interests in Africa and should achieve a common position in which we advance those common interests rather than pursue the mistake that we have different interests as different national powers within Europe.
So, on all those grounds, I would robustly assert that there has been progress towards common positions, common shared objectives to the world outside and a lot of solidarity shown among the nation states. There have been other areas where I could have wished that we could have achieved a more robust and a more united approach. I will be frank with the European Parliament and say that, although I welcome the fact that, on Monday we were able to get a clear statement condemning the recent Indian nuclear tests, it would have been better if that statement had been backed up by a more robust set of measures to give substance to our words. But there is no difference among the Member States as to where we stand in relation to the nuclear tests. We are dismayed by them. We believe they are damaging to the international nuclear proliferation regime. We believe they will fuel regional tensions and we believe also that it would be far better for the security of India and the other countries of the subcontinent if we could find a solution to Kashmir which would be much more productive for an easing of tensions within the subcontinent than any amount of nuclear tests by either side.
To sum up, given the difficulties and given the realities, we have made very real progress towards achieving a common foreign and security policy which is having a marked impact on the world outside. I want to close by saying that as we approach enlargement, we should also recognize that not only will that enlarged Europe offer us a capacity for more prosperity, it will also offer us more capacity for more influence in the world. We will have more power in the world. The question we have to ask ourselves is how do we use that power? How do we make the European power of an enlarged European Union a power for good in the world? One of the things we must do is make sure that we use that power to reinforce and support the values of the European Union and the values expressed by the robust democracy of the European Parliament.
Until recently it was fashionable to see a tension between a commitment to human rights and good governance on the one hand and a commitment to trade, exports and prosperity on the other. It is still possible among some British politicians who have not moved with the times and fail to perceive that they are still trapped in the time-warp. I am bound to say that after the recent Asian financial crisis that dichotomy looks very wide of the mark. What has been fascinating in the recent Asian financial crisis is that the countries who have been best able to respond to financial pressure have been those countries with the most transparent and accountable systems of government and freedom of speech. Those countries which had the most allowance for individual liberty and initiative have been better able to seize the new technologies and to cope with open transparent financial markets.
Conversely, those countries that have been more reluctant to share power with their people, to share knowledge with their people, to share liberty with their people have found themselves having most difficulty in responding to the pressure of financial markets. There is no longer a tension between those objectives of promoting our values and promoting our prosperity. They go hand in hand. Therefore, we should make sure that first recognizing the problems we continue to build a common foreign and security policy and make sure it is a common foreign and security policy that projects our common interests as Europeans and also projects our common values as Europeans. If we achieve that we will have achieved a common foreign and security policy in which we can all take a common pride.

Aelvoet
Mr President, of course I thank Mr Cook for that particularly detailed response to Mr Spencer's report, but I am surprised that there has been absolutely no reaction from the Presidency, and I would like to know why not, to the debate on Cardiff.

Fassa
Mr President, ladies and gentlemen, the ample and well-drafted report that we have just heard from the British Presidency should be of great comfort to us all. It is commonplace to say that the European Union does not have a foreign policy, despite the many rhetorical statements and statements of hope which are often made; but the Presidency of the "Foreign Affairs' Council tells us that significant progress has been made on a number of points, underlining the role of the European Union.
All of this is, in my view, a condition which we can define as necessary but not sufficient. In other words, we are now faced with a series of quantitative increases in EU foreign policy, due to a certain euro-enthusiasm and the fact that we have approved the single currency. But despite this greater effort to craft and to want to have a common foreign policy, we think there is still a lot to do. And there is still a lot to do in terms of the quality of foreign policy. As a Member of this Parliament, I believe that we must hope that foreign policy becomes a constant and common theme of all the political forces in the next European elections.

Titley
Mr President, I would like to thank the President-in-Office for that extensive report. One of the problems while discussing the Spencer report has been that we are looking backwards to the working of the CFSP in the last year, knowing full well that the world we are discussing is going to change. It will change when Amsterdam is ratified. Amsterdam will be seen as a turning point in the working of the common foreign and security policy. Amsterdam recognizes, in a way that Maastricht did not, that we are now operating in a completely new security situation following the end of the Cold War which requires broader instruments and broader measures to maintain European and world security.
In this debate we should really be looking at the implications of those changes and how we can maximize their effectiveness so that some of our concerns about how the CFSP has operated in the past will not be replicated in the future. In particular, I would hope that the Amsterdam Treaty will mark a point where we stop becoming obsessed by the harmonization of the process and become rather more concerned about the effectiveness of the outcome. It is not whether there is a common foreign and security policy worth its name that exercises my constituents, it is whether or not we are able to achieve peace and stability on the European continent.
Amsterdam takes us forward in a number of ways. The policy planning and early warning unit allows us at long last to analyse what we mean by a common foreign and security policy. The existence of a High Representative who will be able to deal with the day-to-day issues and the establishment of common strategies will enable us to start to have a more coherent approach. We also have to look at some of the challenges created by Amsterdam. For example, this Parliament is extremely supportive - and quite rightly so - of the Petersberg Tasks. But the British Army, relative to its size, is now more heavily committed than at any time since the Second World War. What are the implications, therefore, of developing the Petersberg Tasks for our national foreign policies and our national capacities to fulfil our ambitions?
One area where we need to move forward is the link between the Council and the Parliament. This Parliament, in its approach to Algeria, and to Albania, in the establishment of the conflict prevention network, and in its approach to the interinstitutional agreement on the financing of CFSP, has always shown that it is capable of developing a mature dialogue with the Council and the Commission. I would therefore urge that, when Amsterdam is ratified, the Council works more closely with Parliament in the future to develop the CFSP.

Günther
Mr President, first of all I should like to thank the rapporteur sincerely for the work which he has presented to us. I would like to deal with two items, both from the viewpoint of my group and from the viewpoint of the Committee on Development and Co-operation. We are talking about a common security and foreign policy. The question arises in this context of how we should deal with conflicts. The rapporteur stressed this in his report, but it continues to be the case that we come up against unpleasant surprises in this area. We have already invoked conflict prevention several times, and I would like to acknowledge in this context that we have now arrived at a code of conduct for the arms trade. We shall need to examine the document carefully as well, although we should not overlook the fact that none of this will have any effect on the illegal arms trade - which continues to be our major problem.
It has been a source of some regret to me that the Council Presidency has not now dealt with some points in the report which are essential in my view. In the interests of brevity, I shall do no more than quote the numbers, namely paragraphs 10, 14, 15 and 17: these are the questions that need to be addressed. Although the Council Presidency has said it is a matter for Member States, and has passed the buck, it would have been interesting to hear whether there are any approaches which it would be worth pursuing.
There is one more point that I would like to mention, namely the question of the human rights clause which is to be incorporated into treaties with third countries, a demand which has in fact largely been realized in the development sphere, and for which the legal bases have also been created. This shows that foreign policy can sometimes learn a thing or two from development policy.

Daskalaki
Mr President, the chairman of the Committee on Foreign Affairs has drafted an extremely detailed report, which was discussed at length by the Committee and approved unanimously.
Every year the European Parliament examines the progress made towards a common foreign and security policy and every year we are forced to admit that progress has not exactly been decisive, to put it mildly.
Mr Spencer's aim was to bring a greater dimension to this question and to look at it from a broader perspective. Bearing in mind that the common foreign and security policy is at a transitional stage and that foreign policy differs in nature from the other policies of the Union, he stresses - and he emphasized this in his speech earlier - the need for a common, rather than a single foreign policy which also highlights the role of the European Parliament, a role which is the subject of a great deal of discussion but which has yet to meet our expectations.
In addition to specific references to the mechanisms for preventing conflict, for which provision is made in the Amsterdam Treaty, the rapporteur has included an extremely balanced reference in his report to the recent nuclear tests in India and the thorny problem of the code of conduct for controlling the sale of arms. There is insufficient time to comment on these questions individually. I merely wish to say that the report examines all the crucial questions which occupy the Union and that, generallyspeaking, our group as a whole supports the report, with just a very small reservation of minor significance as regards the idea of converting the Commission's offices abroad into embassies.

Bertens
Mr President, 1997 was not a good year for the CFSP. The Council does not seem exactly prepared to make active use of the instruments of Community foreign policy. What was achieved in Maastricht as the great step forward to a real common policy in that area has turned out to be a damp squib. The Union must learn to refrain from making grand promises. That is a great pity for its relationship with the ordinary citizen. The figures in Mr Spencer's excellent report speak volumes. The number of Community actions even decreased in comparison with the previous year. The Union is withdrawing into its shell. That surely cannot be true. In the Middle East, in the Great Lakes area, or in Latin America the Union is allowing others to run rings around it, and is paying for them to do so.
Last year was also the year of Agenda 2000. I still fear that the Commission's financial perspectives are built on quicksand, but this is not a time for short-sighted penny-pinching. Enlargement of the Union is after all one of the most important international challenges it faces in this decade. These years are years of transition. The Treaty of Amsterdam is being ratified. Progress has been modest so far, however. Experience will show how much Amsterdam has delivered. The right of veto could set us back even further. I hope that the Member States can look beyond their short-term interests and understand that their common interest lies solely in an effective common policy. The obstructive tactics by which the French Government has prevented a genuine improvement in the code of conduct on the arms trade is a glaring example of the effects of the veto threat. I only hope that ordinary citizens will understand that it is their governments, not this Parliament, which are responsible for this manifestation of impotence.

Carnero González
Mr President, in a process of transition towards a new world order characterized by unipolar attitudes and globalization, unfortunately the European Union is still not up to it. This is because the political will and the appropriate mechanisms are lacking. Unquestionably, what we already have is not being used enough. Also, the Treaties have not been adequately reformed in this respect. Albania, Kosovo and Algeria, as well as the latest Iraq crisis, are examples of what the public is understandably so dissatisfied about. The political and economic aspects are out of balance, and the terms undoubtedly need to be changed.
What should be the objectives of an EU common foreign and security policy? First of all, security in Europe. Secondly, for human rights and reduced poverty to be the main focus of external action, bearing in mind also the impetus provided by enlargement. In my opinion, we must first make sure that Member States' foreign policies are not too disparate. Secondly, we must adopt more common positions and actions. And, of course, we need to anticipate events, using what could be termed "preventative diplomacy' .
There are obvious priorities. I have already mentioned Kosovo, but we should not forget the Mediterranean, Cyprus and Turkey, the Middle East and Western Sahara. This Parliament has requested that a common position be adopted on this. I should like to know the Council's view. And the matter of the International Criminal Court is still pending.
We should congratulate ourselves on the arms code, but not on the understanding reached on the Helms-Burton Act and the extraterritorial laws between the British presidency of the Council and the United States. Personally, I think this understanding goes against our own interests and does not abide by the principles underlined so many times by this Parliament and the Member States themselves. I think the report from the Committee on Foreign Affairs, Security and Defence Policy is along those lines.

Aelvoet
Mr President, I think that the picture painted in the Spencer report is a fairly realistic reflection of the way citizens in Europe view Community policy. The reality is that every time a major confrontation develops - remember Bosnia, think of Kosovo today, think too of the nuclear tests in India - the general impression is that the European Union seems powerless to act and fails to reach a consensus on how to react to actual developments outside its borders. On that score it is and remains the case that, if one asked an ordinary citizen whether we have a credible and effective common foreign policy, there is no doubt what the answer would be. Yet I think that the answer from Mr Cook contains a large element of truth, in that the core problem is a lack of political will among the Member States actually to achieve a common foreign policy. We could also see that in the Barcelona process, not only in connection with the stalling of the peace process, for which of course Israel currently bears the greatest share of responsibility, but also in the laggardly way in which partnership agreements are concluded. What we see are often blocking tactics which have everything to do with petty-minded national interests but nothing to do with a common foreign policy.

Lalumière
Mr President, the debate on the common foreign and security policy for 1997 evoked some quite contrasting opinions. To begin with, I endorse entirely the report from Mr Spencer which clearly outlined the positions adopted by our Commission with regard to foreign affairs. In other words, the report is excellent in that it contains justifiably strong criticisms concerning the current state of the CFSP. In effect, and this is my second comment, we have scant reason to congratulate ourselves on the development of the CFSP since last year. The situation is, to say the least, not encouraging, even if the President-in-Office of the Council endeavoured, with a measure of clarity and skill, to illustrate what has been achieved.
I would stress a number of items. Institutionally, we are still waiting for the Amsterdam Treaty to be ratified, to the extent that we have still not achieved unity in terms of planning or vigilance, nor even a senior representative in the form of Mr or Mrs CFSP. As regards the role of Parliament, within the context of the institutional agreement on the methods of financing the CFSP, whilst we may be delighted to see some progress with regard to the means of parliamentary control over the actions of the Council in this respect, we cannot help but notice that the documents supplied by the Council to date are somewhat short on detail and too lame to excite any enthusiasm in the more demanding parliamentarians. Indeed, Mr Spencer deplored this situation in his address.
With regard to the substance of foreign policy questions, an assessment of the past year leaves us with something of a sour after-taste. Many statements were made but few common positions and actions were pursued. Moreover, the major dossiers were hardly surveyed by the European Union. I might cite the case of Turkey. Frankly, our relations with this major partner have not been conducted with consummate skill, with the result that today we find ourselves at a dead end. Turkey continues to maintain a hostile stance, Greece and our Parliament continue to block the financial protocol, the Cyprus dossier has been sucked under and the Fifteen choose to assume different positions whereas we need to adopt a clear and consistent common position. With regard to the Commission, we are still waiting for it to advise us of the document relating to the strategy to be adopted towards Turkey, which we have now been awaiting for some years.
This example shows us the dangers inherent in a lack of a genuine common foreign policy. We are flying without instruments and this is not very effective. If I may refer to the excellent report from Mr Tindemans, adopted a fortnight ago, I would make the same comment with regard to the security policy. In fact, it is all a question of political will, others have said this and I would like to stress the point, nothing important will happen if we do not want it to.

Souchet
Mr President, the annual report on progress achieved in implementing the CFSP, irrespective of those who drafted it, relates less to an assessment of the specific results of actions conducted in this context than the progress achieved towards promoting a shared Community responsibility, gradually eroding the intergovernmental nature of the CFSP as defined in the treaties, whereas the latter offers the only opportunity to exist and is the only measure of its effectiveness, as we point out in our Amendment No 10. Regretfully, the report fails to mention, for want of effectiveness, any individual action by a Member State to the benefit of the whole of Europe, as in the case of Italy with regard to the Albanian crisis. We might have hoped that the moderating role played by France in avoiding a disproportionate military action in the face of Iraqi obstruction could be invoked yet again in 1998. No, the only genuine progress worth mentioning must be freed of any link with an individual Member State.
So the report prefers to linger on the major breakthroughs achieved by the Amsterdam Treaty which are, in its opinion, the shared Community responsibility for operational expenditure on the CFSP and the ability to take certain foreign policy decisions on a majority vote and, under that impetus, to advocate the institution of a common European diplomacy, beginning with the conversion of the Commission delegations into genuine diplomatic representations of the Union.
On the contrary, we consider it essential to reaffirm clearly that this is the purpose of our Amendment No 11, drawing a distinction between Commission delegations and the embassies of Member States, which latter enjoy only diplomatic status, as the main source of information required for initiatives undertaken within the context of the CFSP and which constitutes the main vector of their deployment. On this unambiguous basis, close cooperation could be possible between the individual services and might prevent damaging confusion arising in the host countries. Depending on the profile adopted by the CFSP in the future, whether serving a modest complementary function or a maximalist function as a replacement for national diplomacy, depending on whether it tends towards a variable geometry or multiplies the votes by majority, it will prove either effective or unrealistic.
Consequently, the ignorance of national parliaments, the ill-defined extension of its jurisdiction with regard to CFSP matters as sought by the European parliament, backed by the abuse of intergovernmental agreements already practised, do not bode well. It is not in anyone's interest that the intergovernmental nature of the CFSP might soon assume a false front that conceals a quite different reality. It would then slide in the direction of a purely declaratory and abstract exercise of an artificial and superficial nature.

Antony
Mr President, ladies and gentlemen, the excellent words of our colleague Mr Souchet allow me to set aside the speech I had prepared and instead tell you how, in light of the minimalistic, realistic way in which our colleague Mr Spencer dealt with the subject under discussion, I would like to respond to Mr Cook's long statement and, whilst not seeking to reply individually to each item he raised, I would like to make the following points.
With regard to Yugoslavia, I appreciate the way in which he pointed out our sluggish response to the problem. But we should bear in mind that we were motivated mainly by a belief in the legitimacy of the federal, Serbo-communist, Serbo-bolshevik yoke, as I prefer to call it. With regard to the refugees, I understand his denunciation of the dilatory response of the Croatian and Serbian governments but, for my part, I also believe that it would have been better than forcing them to return to the place where they lived, where their houses had been destroyed, which only creates further cause for conflict. I myself have helped house more than 300 orphans from Croatia and Bosnia with the help of the Christian solidarity group I chair. I know these countries very well. I have passed through them and I believe that wisdom suggests that if we can keep Serbian refugees in Serbia and Croatians in Croatia, that is the way it should be. Let us keep our dreams of a totally integrated human race for another time.
With regard to the Middle East, it is almost impossible to ignore the fact that nobody today speaks of the Lebanon. But the problems existing in Israel and Palestine are closely related to those in that very country. We have been told that the Syrian president Hafez-el-Assad is to arrive in France in July. As I understand it, these are inter-state relations, but Hafez-el-Assad is a dictator just like Saddam Hussein. He is probably an even worse dictator: the destruction of the town of Hamra, the assassination of the French ambassador Delamarre, the assassination of our paratroops from Drakkar. Mr Hafez-el-Assad is coming to Paris, although Lebanon does not yet know freedom, occupied as it is in the south by Israel, in the north by Syria, and Samir Geagea has just experienced his 1500th day of detention, along with the majority of the Christian resistance forces. There is a great deal to be said. I just do not have the time.

Van den Broek
Mr President, may I join with previous speakers and, in particular, the Presidency in thanking Mr Spencer for the very comprehensive and expertly produced report he has presented on the implementation of the CFSP in 1997. He has considered every aspect and on many points I can agree with his analysis.
Mr Spencer himself points out that 1997 should in fact be viewed as a year of transition. A year of transition in the sense that in Amsterdam new elements were added to the Treaty which would bring about changes in the foreseeable future to the effectiveness of the foreign policy pursued by the Union. The picture that emerges from the reports shows that further improvements are needed on many points. When it comes to more geopolitical questions, the Union is practically always able to reach common policy agreements. I refer here in particular to the CFSP in the wider sense and have in mind the policy that has been and is being implemented in respect of, for example, enlargement of the European Union, which is also an important area of external policy. I would also mention the initiatives in the field of Euro-Mediterranean cooperation, the deepening of cooperation with Russia, the Ukraine and other CIS countries, attention to the Baltic region and the regional approach to countries of South-Eastern Europe.
The Commission has also produced, among other things, communications on relations with China and the new Trans-Atlantic agenda. Initiatives which will all be followed up by consultations in a Council framework. At the same time it is positive that the Union is playing a major role in the matter of more horizontal questions of human rights, democracy, nuclear safety, nonproliferation and mine clearance. The Presidency has also given a number of examples of those.
I do agree with the report in that perhaps too little attention is being devoted to developments on the African continent. No doubt a common position has been adopted on the prevention and resolution of conflicts in Africa, but the individual disputes in that area, with often terrible humanitarian consequences, perhaps do not feature sufficiently in the deliberations of the Ministers of Foreign Affairs. Perhaps they are still inclined to regard Africa more as a subject for the Council of Ministers for Development and Cooperation.
But this time too it has to be noted, just as last year, that the Union is still in fact failing to react adequately when it comes to acute crisis situations. When prompt decisions need to be taken, national reflexes often take over or, at most, consultations on the strategy to be pursued take place in a limited framework, that is, involving a small number of Member States.
Yes, I agree with Mr Cook: the political will to make use of existing instruments is sometimes lacking and, as I already pointed out in the debate on Mr Tindemans' report on the Union's defence policy last year, when a crisis arose in Albania following the pyramid scandal, we missed the opportunity to play a recognizable role by making use of the possibilities of the Western European Union in bringing the chaotic situation there under control.
I think it must also be said that we have perhaps again been too hesitant in deploying preventive resources in order to avert a spillover in the crisis surrounding Kosovo. There have not even been the beginnings of a discussion on a possible request to the Western European Union to undertake an analysis of the situation and to make recommendations which would then be examined by the EU and used as a basis for any decision to be taken by it. In fact the EU waited until NATO took responsibility for the matter. The Western European Union remains more Sleeping than Beauty.
Will the Treaty amendments agreed last year in Amsterdam, once they are ratified, mean a change in the stance of the EU in such crisis situations and contribute to an increase in the effectiveness and visibility of our foreign policy? The appointment of a Mrs or Mr CFSP, who would bring more continuity and cohesion into our external policy, may indeed be a major step forward. The establishment of planning and analysis capacity, drawing upon the combined knowledge and information of the Member States, the Commission and the Western European Union, may certainly represent value added.
The weak point remains of course the decision-making process. Certainly the European Council can formulate a general basis for policy by voting unanimously, on which the General Affairs Council can subsequently decide by qualified majority, but the question remains of course how well such a concept would work in the particular case of more topical and acute questions on which decisions must be taken rapidly. Fine, experience will be the test, and the next report will no doubt take a view on that.
I do entertain a certain optimism in my hopes for the new approach based on the Treaty of Amsterdam. It is an approach capable of promoting greater involvement of all the Member States, hence offering scope for the development of a broader support base for a common foreign policy. A major contribution to this support base will be provided, and I emphasize this, by the European Parliament, not only by holding debates on current political situations and adopting resolutions, but also by being directly involved. I am thinking here of visits by parliamentarians to third countries and of activities, such as election observer missions and the like, performed by parliamentarians. This support base is of great importance, particularly in view of the forthcoming enlargement of the Union. In addition I take the view that, as has already been stated, monetary union will exert a cohesive influence. The common monetary policy will undoubtedly have a positive effect on other policy areas.
By giving concrete content to the new Treaty provisions, but also by then actually carrying out certain Petersberg Tasks, the Union can at least make a start on developing a common security policy. In the longer term a common defence policy could evolve, through which the Union would be able to play a role in the European security architecture on an equal footing with other actors. The current assessment is that, even where conflict situations are being played out within Europe or at its borders, we are not yet able to perform a key role on an equal footing. That vacuum is quickly filled by others and the European Union is then usually approached exclusively in terms of its financial resources, as Mr Spencer has rightly pointed out. Only a well prepared and implemented common foreign and security policy can bring about any change in this situation.

Barón Crespo
Mr President, first of all I want to welcome Mr Spencer's report. He has managed to avoid that rather nagging tone which sometimes characterizes parliamentary contributions on foreign and security policy, which simply recite our growing list of failures. On the contrary, I think Mr Spencer has managed to achieve a positive tone. The Presidentin-Office of the Council, Mr Cook, has assessed the British presidency's performance in this field, now we are halfway through the year, and I think he did it well. Allow me to contribute to this topical debate by saying that I agree with the President-inOffice of the Council that we really are very different, with different histories, and sometimes we are engaged in disagreements, but the fact is that there is a major contradiction between foreign policy and what we are doing in other fields. In the context of Economic and Monetary Union, we have decided to launch the euro despite our great differences. This was even done under the British presidency, which is a good manager despite the fact that the UK is not taking part at the moment. Nevertheless, in foreign policy we always bring up differences and problems. To sum up in a very fundamental statement, I believe that foreign policy projects and develops a country's domestic strength. That has been true throughout history.
I would add that there is a clear demand for the EU's presence on the world stage. We are present and, despite our failures, we are developing our presence, for example with enlargement and with Russia. There are also EU representatives in Bosnia and the Middle East. Furthermore, they are there all the time, not just when the television cameras are there, and they even try to act with a certain amount of consistency. I welcomed the bravery of Mr Cook, the President-in-Office of the Council, in Jerusalem. As for the United States, there was an example today of the sort of things that happen. In the Knesset , the speaker of Congress, Mr Gingrich, referred to the US Secretary of State as "the agent for the Palestinians' . So far, I do not think we say such things about each other.
I believe improvements are needed, and we are continuing - I think - to consolidate everything, but some important instruments are missing. I do not think we went far enough at Amsterdam. We have appointed a president of the European Central Bank, we have extended the troika, consolidating the Commission a bit, but then we have a Mr or Mrs CFSP which, at the moment, is an invisible post. Parliament has managed to join in, in budgetary terms. Nevertheless, we are not taken into account when it comes to forming an interinstitutional agreement in order to listen to our recommendations and suggestions. I think there is still time, not by changing the Treaty of Amsterdam but by trying to improve our relations. So I welcome Mr Spencer's proposals in this respect.

Stenzel
Mr President, unfortunately the European Union's common foreign and security policy continues to be more a matter of wishful thinking than a reality. That is why the Spencer report is quite right to stress that the public has not been given the impression of progress in the development of a European foreign policy. The lack of an inter-institutional agreement on the right of the Parliament to be informed and consulted is also a weakness. We can only observe with regret that there continues to be a mismatch between the EU's foreign policy and its trade policy activities.
Given the major foreign policy challenges of the European Union resulting from the enlargement process, the citizens of Europe must be allowed to participate in this process through the involvement of the European Parliament, not in order to throw a spanner in the works but to strengthen the acceptance of enlargement in Europe. The European Union will be tested repeatedly against the yardstick of its ability to act in foreign policy matters. It is important for the EU not only to speak politically with one voice but also to have available the necessary security policy instruments in order to take peace-keeping or peace-making measures, for the purposes of crisis prevention, whether it be in Albania or Kosovo. The deteriorating situation in Kosovo is a priority for Austria as the next Council Presidency but as long as the political will is lacking to exercise real influence here, all initiatives threaten to become a demonstration of impotence, and the European Union runs the risk - as has already happened in the Balkans - of becoming an onlooker at an uncontrollable development and of letting slip the need to act.

Ephremidis
Mr President, the title of the report, "The role of the Union in the world' , is nothing if not grandiose. This grandiose title is followed by a total of 9 headings and 26 points. And all of them are peevish, whingeing statements of the obvious, not one of which is bold enough to get to the heart of the matter. Relations between the European Parliament and questions of foreign policy: there is no interpretation, Parliament's opinion is sought neither by the Council nor the Commission, decisions are not taken at a cross-institutional level which would make the demands of the Treaties binding.
And what about the common foreign and security policy itself: this has progressed from non-existence to inadequacy. As the report says: public opinion does not value it. That is a fact. There is no coordination in arms exports. But the report does not say why or how coordination can be achieved.
My third point relates to the Community values which it preaches; the following are not included as a sine qua non in the individual clauses of agreements with third countries: human rights and everything else which one could include in these agreements. It makes no reference to the typical example of Turkey, which has no respect for anything but which....
(The president cut off the speaker)

Tatarella
Mr President, ladies and gentlemen, unlike my colleague who preceded me I congratulate the President on his excellent report. It is an important and well-written document because this debate is not resolved in the usual annual meeting but instead it is a great opportunity, firstly, for an analysis and in-depth clarification of the state of foreign policy and the role of Europe in the world; secondly, for a clear and strong awareness on the part of the European Parliament of its role, its prerogatives and its strength; and thirdly, for a precise and specific indication of proposals and suggestions which may lead to real progress in matters of foreign policy.
On this point, the European Parliament's claim of its right to be informed and consulted on international negotiations and bilateral and multilateral commercial agreements is significant and important. Our Regulations, Mr President, should be adapted as soon as possible to reinforce the role and powers of Parliament, to guarantee information and consultation which are efficient and detailed. At present, the Council and the Commission snub Parliament: with the information given intermittently to the Parliament they are not fulfilling their obligations with regard to the Treaty, and above all, their duties with regard to the citizens of Europe. This is a Parliament which represents 300 million citizens, it was elected by direct universal suffrage in fifteen Member States and it is the strongest democratic Assembly in the world.
Given this democratic strength, we must demand a greater role for the Parliament to contribute to giving the European Union an authentic foreign policy which, today, as we are all aware, is lacking or is completely insufficient.

Truscott
Mr President, I would like to thank the President-in-Office and the Commission for their statements this afternoon and Mr Spencer for his report.
May I begin by congratulating the President-in-Office on securing a ground-breaking agreement on the EU code of conduct on arms exports this Monday. I welcome the strengthening of the eight criteria agreed at the Luxembourg and Lisbon European Councils which mean that arms exports from the EU must not be used for internal repression, external aggression or supporting terrorism. The code of conduct will enhance the effectiveness of the common foreign and security policy. Can I, however, make the plea that the Council's annual consolidated report on the code is published, so strengthening transparency and giving the European Parliament an opportunity to debate and comment on the code's implementation.
On the operation of the CSFP in 1997, it is fair to note that there have been a number of successes including democratic consolidation in central and eastern Europe. The creation of a policy planning and early warning unit and the office of the High Representative, outlined in the Amsterdam Treaty, and already mentioned this afternoon will help improve the visibility of the CSFP. However, further work will have to be done on creating closer organizational links between the WEU and EU which under the protocol on Article J VII of the Amsterdam Treaty must be in place within a year of the Treaty entering into force. This is necessary to make the CSFP, the Petersberg Tasks mentioned by the Commissioner and the European security and defence identity a reality. An inter-parliamentary delegation between the WEU Assembly and the European Parliament would assist in this task.
In 1998 we have witnessed further progress under the CSFP and many of these have been outlined by the President-in-Office, particularly, I would say, the successful launch of the historic enlargement process.
Over the coming year, I hope the Council will establish an ever closer working relationship with the Parliament as the CSFP continues to evolve.

Sindal
Mr President, with reference to Mr Spencer's report, the House has in fact been in general agreement that little progress has been made. I, too, concur with this. I can also agree with a further three points. Action is notable by its absence when it comes to the will to prevent conflicts, for example in the Balkans, as we have heard. Further, there is the matter of interinstitutional collaboration and formal regulations. I, too, would like to draw attention to the importance of proper Parliamentary involvement, if this is to be considered a project of the people. I agree with the comments made regarding CFSP and the analysis unit, but I would like to emphasize that I regard this analysis unit as a support to the Council, not some lofty new institution.
However, there are points I must disagree with. As a Dane, I am somewhat alarmed at the good intentions described in the report, overshadowed as they are by armament and proposals to integrate the WEU into the Union. Naturally, I must distance myself from that. The Petersberg agreement is accurately represented, and I endorse this. The Amsterdam Treaty describes what could practically be called the prospects of welding together the foreign policies of Member States - as Mr Cook, the Foreign Secretary, said previously - while respecting the wishes of each individual country. We must beware of being so ambitious that the project will become untenable. New security structures alone do not produce results; the crucial factor is the will of the Member States.

Donner
Mr President, Mr Cook made an impressive statement about the achievements during the British presidency. He forgot to mention that the football championships will start in June; maybe that is also due to the British efforts.
There is an abundance of talkative well-wishers within the Union; the Council issued 124 declarations during 1997 on foreign policy. Did they change the reality? The answer is No. In the Spencer Report as it stands today there is the wish to integrate the WEU into the Union. Maybe some people will have a clear conscience after that.
Everybody is talking about the weather, nobody is doing anything about it. Everybody is talking about foreign policy but where is the substance? If too much time is consumed by secondary matters there is less time for crucial issues like enlargement and the partial inability to act.
General politics remains the heart of the matter within the Union. Everybody wishes to preserve peace and stability but the willingness for joint action remains limited as was shown in Albania. One example, as the Middle East peace process slowly dies - thanks to Mr Netanyahu - despite heavy Union investment in the area, the whole prospect of a common, foreign and security policy must be re-examined including, in this case, economic and other sanctions.
The Spencer Report clearly shows that there is almost no progress in the foreign policy field. Congratulations to Mr Spencer for stating the obvious.

Swoboda
Mr President, President of the Council, I should firstly like to congratulate Mr Spencer on his report which has given rise to what has certainly been a very interesting and critical debate. After so much discussion and so many substantive contributions, I would like to confine myself to just two critical observations. The first is the visibility of our foreign policy, and the second is the diplomatic service. As far as the visibility of our foreign policy is concerned, I would like to emphasize that, even in the areas where we do arrive at a common foreign policy, it is often not really visible to the population of the countries concerned. I know that this is a problem. I have just come back from Turkey. Are there many people in Turkey who know what our foreign policy is, what the Luxembourg decision is? Mr Robin Cook, the Foreign Secretary, has just paid a very successful visit which was completed in a very positive manner, even if the results are not yet available, but that would be to expect too much.
But are there many people who can appreciate the efforts which the EU in particular undertakes to support human rights organizations? I was recently in Israel and Palestine. How are things there? Have we really given enough thought to how we can improve the visibility of our foreign policy?
My second remark concerns the diplomatic service. We have outstanding women and men in the diplomatic service. But I ask myself why a Commission representation has still not been set up in Algiers after so many months of intensive meetings? Why has the diplomatic representation in Turkey and in Slovakia been vacant for so long? It may be no fault of the Commission; it may be that some countries who are keen to send a representative from amongst their own ranks to these places need such a long time. But I believe that this is intolerable for our common foreign policy, and I ask the representatives of the Commission, the Commissioner is here now, and you as well, Mr President of the Council, to look to ensure that greater efficiency is applied in carrying out our interests even in those areas in which we have a common foreign policy. I regard this as very important.

Cook
 - Mr President, I find myself in sympathy with most of the objectives that have been expressed in the course of a very full debate in which all those taking part spoke with vigour and obvious commitment.
If I can straight away dispose of the one speech with which I did not agree. I could not find myself in agreement with what Mr Anthony said about refugee return in the former Yugoslavia. Let us not forget the basis on which those refugees were created. They were created by vile, violent and ethnically-based confrontation. It is a very important as we construct a new Europe that we construct a new Europe on principle of ethnic pluralism and tolerance of minorities; that is after all one of the standards we apply to countries seeking to be members of the Union and it should also be a standard we apply to countries that seek to be in trade agreements with us.
I said earlier this afternoon how much we welcome President Nelson Mandela coming to Cardiff. We cannot celebrate the abolition of apartheid in Africa, only to tolerate it being created at home in a corner of Europe.
Otherwise, I find myself in much agreement with many of the objectives stated here. The one point that I did feel running through the discussion is that there was sometimes a failure to grasp that it was not enough to state the aspiration in order to deliver the outcome. I was particularly impressed at Mr Carnero González listed as failures of the common foreign and security policy: Albania, Algeria, Kosovo, Western Sahara, the Middle East peace process.
There are immense problems in the world and there are some severe cases of conflict. I believe we are setting ourselves a totally impossible task which is bound to leave us all with a sense of frustration if we make the test of a common foreign and security policy whether it has resolved all conflicts within the world.
First of all, that is unattainable. Secondly, I would also counsel colleagues against a modern form of imperialism by thinking that the solutions that we ourselves decide are the right solutions in Europe are necessarily acceptable to those who are involved in conflict in other continents of the world. We have an obligation to offer our best offices to assist them in finding a solution and to take measures against those who willfully and irresponsibly prolong conflict or prolong violence. Within those two objectives of seeking to achieve a resolution of conflict and to deter people from the use of violence as a means of resolving conflict, we should ourselves find a common position among our countries. That will not always produce the solution but we certainly have an obligation to find that common position.
If you look back over the events of recent months, on a number of these conflict issues, Europe has indeed adopted a common position, has sought to seek to achieve solutions. It has not always succeeded and in those cases where we have success, like Bosnia, the process of clawing back from the bitter hatreds of recent years is inevitably going to take time if not a generation to complete. I would ask the Members of the European Parliament, whilst they are perfectly entitled to demand a common concern and common action from the Council, to recognize that will not necessarily produce outcomes and will certainly not produce outcomes that will be acceptable in the immediate short term.
Finally, can I pick up one or two colleagues who have referred to the mechanisms provided for by the Amsterdam Treaty to improve the common foreign and security policy. It is indeed the case that when we have the planning and early warning unit and when we have the High Representative in place, we will have a better mechanism for giving expression to the common positions we adopt. They will, of course, not have any legal basis until the Amsterdam Treaty is ratified. That is up to the Member States. Colleagues within the European Parliament can go back to Member States to make sure that they are achieving all possible speed in making sure that they do ratify. I am pleased to report to you that we have now almost completed the parliamentary processes in Britain for ratification of the Amsterdam Treaty. If other Parliaments achieve the same timescale, we can achieve ratification within the next few months and that will give a legal basis to these steps forward in common foreign and security policy. In the meantime, we have used our Presidency to take forward the preparation so that from the moment we have the legal basis to proceed we can proceed quickly with the changes in personnel, the arrangements, the provision for resources in place so that within the legal basis we can act immediately.
I end with one plea to all Members, I have listened with great interest to a number of speeches this afternoon demanding a common foreign and security policy and condemning the Council for lack of political will in achieving it. I am bound to say that in each of the countries from which I heard speakers speak eloquently and passionately this afternoon, I could recite lists of cases in the past five months when their Member State has held out against the others in achieving a common foreign and security policy; particularly in the case of Madam Lalumière who made the most rigorous demands for a common foreign and security policy.
Building such a common position is not easy, it requires compromise all round. We will never get a common foreign and security policy by one nation demanding that the rest of Europe adopt their common foreign and security policy. It will require trade-offs between us and if we are going to achieve it our best prospect of achieving it is if we go into it openly recognizing that all countries are going to have to work for the common good and at times are going to have to abandon their own national positions in order to do so.
Sometimes, and my own country reserves that right, we will have to say no we cannot abandon this particular national perspective because it is too important. We have to retain that right to defend a national interest. That makes it difficult, of course, to oppose a common foreign and security policy but I would submit to Parliament that it is also an essential part of making sure that we get the popular agreement and the popular support for the legitimacy of the European Union.

President
The debate is closed.
The vote will take place tomorrow at 11.00 a.m.

South Africa
President
The next item consists of the statements of the Council and the Commission on the situation in South Africa.

Henderson
- Mr President, I should like to say how pleased I am that Parliament has chosen to debate this important subject at this important time. As Parliament will know, since 1994 the European Union has made a series of commitments to help South Africa through its transition from the apartheid regime. We remain determined to continue to help South Africa during the economic and political transformation in its society. We in Europe have seen how achieving common goals of economic development and prosperity binds societies together. We would all recognize that trade and cooperation between nations is much more likely to bring them closer together. The best way for the European Union to help South Africa is to allow South Africa greater opportunities for trade and economic development that will help that country to heal the divisions in its society caused by so many years of hatred and oppression.
I also believe that South Africa has the potential to be one of the catalysts for growth and development in Africa as a whole. The European Union must continue to do everything it can to help to build on that potential. Many of the European Union's commitments which I mentioned earlier have already been fulfilled. One undertaking we made was to offer South Africa qualified accession to the Lomé Convention and I am pleased to say that this accession will finally enter into force on 1 June now that it has been ratified by all Member States. I look forward to South Africa's full participation in the political dialogue between the ACP and the European Union that lies at the heart of the Lomé relationship.
The European Union and South Africa also concluded a science and technology agreement in November 1996 and talks on separate agreements covering fisheries and wines and spirits continue to make progress. In terms of aid, the European Community has committed substantial development assistance of over ECU 100m per year to South Africa through the European programme for reconstruction and development which will continue at least until 1999. I can tell Parliament that it is a UK presidency priority to make as much progress as possible in the negotiation of a trade and cooperation agreement with South Africa and on the related agreements on fisheries and wines and spirits. In the last few months we have come a long way but I believe that there is a political will to go substantially further before the end of June.
The trade negotiations have been slow in the past but they gained a renewed impetus last autumn with a detailed South African offer. Chief negotiators on both sides believe that a deal which is fair and beneficial to both sides is within reach. Indeed, on 30 March the General Affairs Council asked Coreper, together with the Commission, to examine options for improving the European Community offer. Talks are now at a critical stage. Efforts will be needed on both sides to show flexibility. The presidency has remained in close touch with the South Africans throughout as well as working closely with the Commission and other Member States. I am encouraged by the repeated statements from South African ministers of their determination to conclude an agreement.
Both sides will need to look again at areas such as increased coverage of overall trade in order to reach a WTO-compatible agreement. Any agreement will also have to meet the concerns of both sides about their offensive economic interests, for example in the agricultural and industrial sectors. Naturally, taking account of Community sensitivities and economic interests remains a key objective for our negotiators. Throughout the negotiations the Council has been very aware of the potential effects an agreement may have on the neighbouring countries of the South African Development Community. Both the European Union and South Africa have repeatedly made clear that the concerns of those countries will be taken into account during the negotiations. The European Union/South Africa Agreement must be positive for the whole region.
With this in mind the Commission has said that it will consider technical assistance to countries of the Southern Africa Customs Union during any economic adjustment period and I strongly believe that the economic benefits an agreement would bring to South Africa will be shared by South Africa's neighbours. I would like to take this opportunity to thank honourable Members for the interest they have shown in the Council's efforts to reach an agreement with South Africa. In particular, I would like to thank members of the delegation for relations with South Africa whom I met earlier in the presidency and whose expressions of support for the negotiating process have been extremely welcome. I hope all honourable Members will continue to support these efforts during the critical weeks to come and in the future when the final agreement will require the assent of this body.
The European Union will have a further opportunity to show the importance it attaches to relations with South Africa at the European Council in Cardiff when President Mandela will be having lunch with the assembled heads of state or government. I would like to reiterate my belief that with hard work and good will on both sides a satisfactory result to the trade negotiations can be achieved. I hope we can continue to make rapid progress towards concluding the agreement and honouring the commitments we have made to South Africa. I again thank this House for its continued interest and support and sense of urgency and priority that a trade agreement is reached with South Africa.

Pinheiro
Mr President, it will soon be three years since we launched an ambitious set of negotiations with the new South Africa, after the Union had set itself a unique goal: that of establishing a long-term framework for cooperation with this important partner, that would underpin its historical transition to democracy and reflect the dual nature of its economy.
ln April last year, we had the pleasure to welcome South Africa as the 86th member of the Convention of Lomé. At the ACP/EC Council of Ministers in Luxembourg, a special protocol was signed which gave South Africa qualified access to the Lomé Convention. This fact marked the conclusion of the negotiations on the first track of the envisaged framework for EU/South Africa cooperation.
But after three years of hard work, we have to note with some regret that the second track, that will lead us to a bilateral trade, development and cooperation agreement, is not yet finalized. We have made a lot of progress and tentatively agreed on most sections of the future agreement. But work remains to be done in several important areas before we can conclude.
Last month we had our 18th round of negotiations and a further round is planned for 10 and 11 June. At several points the gap between the EU and South Africa remains to be bridged. This being said, I believe that there is still a good chance to finish the work soon. There remains a window of opportunity for us to use. The Commission is making every effort to complete these bilateral negotiations with South Africa before we enter into the post-Lomé negotiations next autumn. On the South African side, we also understand that there is a wish to conclude the agreement with the EU before the start of the electoral campaign for the country's next general elections that are due to take place in the first half of 1999.
What are the main outstanding issues? Firstly, a few problems remain on non-trade issues, notably on the wording of our proposed non-execution clause and on the question of the future financial resources that will be available for development cooperation with South Africa. No financial amounts will be mentioned in the agreement, but the Community is called upon to give the political reassurance that financial assistance to South Africa will indeed be continued beyond the year 2000.
Secondly, several issues are still outstanding in the area of trade-related aspects, which are essential to any free trade arrangement. Further discussion and negotiation will be necessary to agree on precise undertakings in the areas of anti-dumping, safeguards, competition policy, government procurement, intellectual property and maritime transport.
Finally, some real obstacles need to be resolved in the trade sector in order to arrive at an agreement with South Africa that meets the principles which the Community considers essential, and to which I will refer briefly. The first principle is its full compliance with WTO requirements. As you know, it is widely understood that a free-trade agreement should cover not less than 90 % of total trade between the parties in order to avoid possible interpretative discussions in the context of the World Trade Organization. The current EU offer covers 89 % of imports from South Africa. The South African offer proposes to liberalize 81 % of its own imports from the European Union. Both offers therefore represent a significant step towards improved market access, but they are not attractive enough to the other side, and they may not be sufficient to secure the WTO compatibility of the agreement. The time has come for both sides to increase the coverage of their respective trade offers.
We know it is not an easy step to make, because it touches on sensitive sectors and interests on both sides. But we need to move in this direction while bearing in mind the two principles of reciprocity and asymmetry which underpin our trade talks. Tariff elimination on the European Union side will in principle be quicker and achieved within 10 years. The South African offer is based on a 12 year transitional period. If we can move towards additional trade concessions, we would secure deeper improvements in market access and, at the same time, a significant element of differentiation that would take account of the differences of development between the two sides.
The second principle is coherence with EU common policies. The trade agreement with South Africa must be coherent with existing European Union policies such as the European Union's common commercial policy and, in particular, the common agricultural policy and the common fisheries policy. South Africa is the first case in the Union's history of a preferential agreement where the objective of free trade also applies to agriculture. The bulk of the European Union's agricultural concessions to South Africa are scheduled to begin after 2003 or 2005, so that they can dovetail with progress in the CAP reforms. Some agricultural products will, for the time being, remain excluded from tariff elimination. But even for these products, partial liberalisation may be considered in certain cases and a regular review should be foreseen. Tariff concessions are also envisaged on fisheries products but they remain conditional upon the progress achieved in the negotiations for a separate fisheries agreement.
The third principle is the coherence with the provisions of agreements with other preferential partners. Our agreement with South Africa must also be consistent with the European Union's existing external agreements, with particular attention to Mediterranean countries and the countries of the ACP group. Fine-tuning will be necessary in order to protect the key export interests of these countries at the European Union market, but also to assure that the terms of SA access to the EU market is comparable with that of countries in a similar position. Consistency will also be sought in the area of rules of origin.
Finally, the fourth principle is that we must have a strong developmental dimension, for the benefit of South Africa and its neighbours. It is our definite objective to ensure that the EU/SA agreement will have a positive developmental impact not only for South Africa itself, but also for the southern African region and the ACP group at large.
From the outset of the negotiations two years ago, we began a process of regular consultations with the ACP group and various sub-groups whom we meet regularly. Based on what we have heard during this process, we are confident that, if successfully worked out, the agreement between the European Union and South Africa will be of benefit not only to both parties, but also to many others that have strong economic ties with South Africa.
How can we assure the positive impact that we are aiming for? I would say that the answer is in political commitment informed by sound economic analysis. The political commitment is there. We are still working on the analysis. In our view the impact of this European Union/South Africa free-trade agreement will be felt in three concentric circles. First, there are benefits to accrue to the BLNS countries - Botswana, Lesotho, Namibia and Swaziland - the four neighbours of South Africa which belong to the South Africa Customs Union, SACU. Second, there will be benefits for the SADC region - the broader circle of 14 countries covering the whole of Southern Africa. And third, we have to look at the wider ACP family.
We expect ongoing studies to confirm that the free trade agreement will bring significant gains for consumers and entrepreneurs alike. The business community will have access to a cheaper and more diversified range of supplies for their inputs and capital goods and they will thus stand better prospects for investing, exporting and hiring additional staff. Job creation and an investment drive in the region are expected to be the main positive effects of our free trade agreement with South Africa, and will be enhanced by a more intense economic cooperation.
The principles which guide the Union in its negotiations with South Africa give no ground for controversy. They echo the ambitions of the new South Africa, which has placed itself at the forefront of an 'African Renaissance' . As the European Council prepares itself to greet President Mandela in Cardiff next month, it is essential for us to ensure that the Community translates its commitments into a generous and innovative agreement that will foster trade, enhance development and promote peace and stability in the region.
As we enter into a decisive phase of these ambitious negotiations with South Africa, we are fully aware that the agreement we shall reach is of importance to many others and will be seen by many ACPs as a crucial test for the future of Lomé itself. It is for us to demonstrate that free trade can take place in a developmental context and to reconcile mutual interests with solidarity. I hope our Member States will join us in expressing these views and if this is so in Cardiff, I am confident we will succeed very soon.

Kinnock, G.
Mr President, I should like to thank the Commissioner and congratulate the UK presidency on the clear commitments they have made to these trade and development talks. I would also like to thank the Minister of State himself for his willingness to prioritize this matter with us in the European Parliament. As they have both said, we have reached a very critical stage in these negotiations. Neither of them actually mentioned the fact that we have had the postponement of the nineteenth round which was due to take place this week. This is a very worrying delay in a very difficult process. It is one that I have been aware of since I was the rapporteur on the interim agreement.
However, in the light of the South African negotiating team's willingness now to put forward a new - and significantly improved - offer of possibly 85 % product coverage, does the Council anticipate that there will be commensurate adjustments coming from the Commission in the negotiations on our side? Let us be clear. The South Africans now are saying that they are willing to make substantial adjustments themselves in order that we can see some clear progress. Unless the European Union is prepared to take clear initiatives to revitalize these talks, we risk jeopardizing the whole process.
I do not want the President-in-Office to think that I am alarmist but the reality is that the EU has only two weeks to prepare an appropriate response which can ensure that the essential elements of the trade components of the negotiations are concluded and ready for discussion in Coreper the following week. Naturally, we do not anticipate a final or complete agreement but we should aim for 'fine-tuning' and no more during the Austrian presidency. This will happen if we have substantially agreed the main and most contentious trade issues. Obviously asymmetry has to be taken out of the cupboard and given a good dusting down and has to be discussed very fully in the negotiations. The Commission has mentioned that already.
In the context of a global changing market, any agreement on the liberalization of trade set to take place in the timescales envisaged would be unlikely to survive. There is the reform of the CAP, there are the new GATT negotiations, so is it not likely that they will be both outdated and meaningless in the timescale being dealt with? Let us be prepared to get back to basics. Let us stop getting bogged down by product-by-product wrangling. We need to be generous.
President Mandela is approaching the end of his presidency after showing courage and unrelenting determination to ensure a better future for South Africans. We have a clear part to play. The President-in-Office may recall that in January I asked him in Strasbourg if it was possible that we could invite President Mandela to Cardiff to sign an agreement. He is now coming to Cardiff to say farewell to heads of state - and to savour the delights of the capital city of Wales! Would it not be icing on the cake if we could acknowledge at that time that broad agreements had been reached between the European Union and his country of South Africa?

Maij-Weggen
Mr President, I also want to have a more global approach to this problem and step back somewhat from the details of the negotiations. When I was a minister, I myself had to take part in various negotiations in the Council of Ministers, including those relating to transit agreements with Austria and Switzerland, and I know how you can get bogged down in details if you lose sight of the whole picture.
When South Africa, after a long, dark period of apartheid, achieved a very honourable return to democracy the Western World rang with laudatory declarations and promises for the future of the country. The European Union too rallied behind those declarations and promises. The economic boycott which South Africa had had to endure was to be transformed into economic cooperation, and South Africa was to get generous aid from the European development funds. That was the picture shortly after the achievement of majority rule. And, happily, it came to fruition. That has all been detailed again by the President-in-Office of the Council and by Mr Pinheiro. South Africa receives considerable financial aid to overcome the effects of apartheid and those projects are faring well, as far as I have heard.
The major problem, however, is in the trade agreement, which has been dragging on for three years now. Precisely that agreement is of great importance to South Africa because, after the years of economic boycott, South African agriculture and industry need a chance to grow and export, to Europe as well. That is indeed the only real way to fight poverty in South Africa and to stimulate employment, also for the black population. There is 40 % unemployment in the country, especially among young people. That is far too high. We have to realize that. It represents a grave danger for stability and perhaps even for democracy in that country. The increasing crime rate is also bound up with that. Against that background it is hard to understand why the negotiations are dragging on so long, and it is also hard to understand why they have got bogged down in such details. Of course South Africa has also had problems. We are well aware of that, particularly in relation to the surrounding countries, and that is also a serious point. But the real brake on the negotiations is in the hands of the Member States which have refused to make concessions, particularly in the area of agriculture. That is the nub of the problem.
My group considers that it is high time to put a stop to that insidious process of detailed negotiations and to make a gesture towards South Africa. This means that every Member State must give some ground. But the result can be a real agreement. We think that when President Mandela comes to Cardiff - I have had the pleasure of meeting President Mandela several times - that generous gesture must be made to him. Perhaps the heads of government must have the courage simply to draw a line under the negotiations and say "let us go ahead and do it' . We want to reach out a hand to Mandela and we want South Africa to be able to conclude good agreements with Europe and thereby gain a chance to develop its economy. We need that, Mr President. Hence my general political appeal, avoiding the endless details that are being dished up again now.

Collins, Gerard
Madam President, I would like to thank the Council and the Commission for the statements they made before Parliament today. We are all disappointed at the rate of progress in the negotiations for the trade cooperation and development agreement with South Africa but it is important that the end result of the negotiations is an agreement which is beneficial to the long-term interest of both parties to these negotiations. South Africa is the major economic force in sub-Saharan Africa and the European Union is its principal trading partner. It is clear that any agreement will have far-reaching implications, not just for our future relationship with the Republic of South Africa but also with its neighbouring countries.
Parliament should take the opportunity presented by today's debate to reaffirm its commitment to the political aim of reaching a wide-ranging and comprehensive agreement with South Africa which is fair to the interests of both parties. I would like to express my full confidence in Commissioner Pinheiro and his team of negotiators who I know will make every effort to conclude an agreement in line with the negotiating mandate they have been given by the Council of Ministers; a mandate which did not reflect the public statements or commitments given by heads of state or government to President Mandela which, of course, raised very highly the level of expectations in South Africa.
In April the Commission officials put forward a series of proposals which would allow a level of openness of 95 %, a significant improvement on previous European proposals. I hope that South Africa will shortly be able to respond to this improved offer and that every effort will now be made to conclude the negotiations as near as possible to the target date of mid-1998 or at latest by the end of the year.
I would also like to take this opportunity to say in my capacity as chairman of Parliament's delegation for relations with South Africa, that I and my delegation colleagues have had extensive discussions with South African government ministers and representatives of NGOs concerning the European programme for reconstruction and development in South Africa. It is my belief that this aid programme continues to make a valuable contribution towards the promotion of the economic developments of the disadvantaged within South Africa and I hope that this programme will be continued after 1999. I will conclude by inviting the Commission to submit a proposal for the continuation of the EPRD to Parliament and the Council as quickly as possible for our consideration in good time before the end of the present programme.

Bertens
Mr President, what began as the start of a new era has in reality been a malodorous affair up to now. The dual approach of South Africa involving qualified membership of the Lomé Convention and bilateral negotiations geared to free trade is the right one. The results in practice have been less appealing. Exclusion of 45 % of agricultural products is in conflict with the spirit of that approach. The Union must make a generous gesture. What is at issue here is an asymmetric agreement with a country in which, for the moment, everything is not as it should be.
The Union must prepare a follow-up reconstruction and development programme. When the current one runs out in 1999, it merits immediate continuation. I should like to hear from the Council and the Commission whether more attention can be devoted in the aid-giving process to the security aspects of development. South Africa is ravaged by crime, and a culture of violence has taken a grip on the country.
There must be more control of arms flows. Perhaps the Council can also comment on the action programme of the Union on small arms and the conference it recently held in South Africa.

Querbes
Mr President, the advancement and the conclusion of negotiations between South Africa and the Union marks, in our view, a vital step forward. The stakes, as the President-in-Office of the Council reminded us, consist in consolidating the human and democratic progress achieved in that country to contribute to a development generating business and jobs and to promote, through South Africa and its extensive influence throughout southern Africa, stability, peace and the future development of an entire part of the African continent.
To this end, we hope that the next meeting between President Mandela and European Union leaders may record not only further advances in the negotiation process, but also the ability to bring them to a conclusion. To achieve this, the Commission and the Council must provide evidence, as their representatives have just confirmed, of the generous spirit that spurs European governments forward in their relations with South Africa and provide a measure of the mutually advantageous consequences that might derive from the furtherance of economic relations between the European Union and South Africa.
Of course, the promotion of interactive relations with South Africa must not cause us to sacrifice a production sector in the Union, particularly agriculture, which too often serves as a common currency in agreements between the Union and Third World countries. But in this case, the problems are not comparable. Not a great deal of our production is truly competitive, due to the problem of distance and the reversal of seasons which may contribute towards promoting complementarity as opposed to competition. We must pay great attention to these matters. So, within the context of a necessarily asymmetrical approach, we must spread the spirit of solidarity that binds us through all production sectors in the Union. In addition, by reviewing the product exclusion list on an annual basis, we will better understand the competitive situations and will be able to restrict the number of products concerned from the outset.
To conclude, I would say that our co-development and solidarity actions should be expressed through other instruments of the Union, such as direct financial aid or the Lomé Convention. With this in mind, I would hope that the Commission and the Council might seek in the coming weeks to conclude an economic agreement which would reflect the support of the people of Europe for those who conquered apartheid.

Aelvoet
Madam President, I would like to express the grave concern of my group over the state of the negotiations between the Union and South Africa. Years ago the European Parliament had already formulated very precise proposals taking account of the legacy of apartheid and of the need for regional integration, and making a clear appeal for asymmetry for the benefit of South Africa. The Union proposals that are still on the table make no response whatsoever to the demands which had been very clearly formulated by the European Parliament. I would like to focus attention on four points.
Firstly, the problem of inadequate access for South Africa's agricultural products to our market, while at the same time heavily subsidized farm products from the Union wreak havoc on the South African market. Thus, on the point of consistency with other EU policy sectors, the European Union must examine its own conscience.
Secondly, protectionism with regard to certain finished products from South Africa.
Thirdly, concessions which mean very little in the short term or come into effect so late that by that time the exporters have long been forced off the South African market.
Finally, the point of loss of income from customs revenue, for Botswana, Lesotho, Namibia and Swaziland: no satisfactory proposal is currently on the table from the European Union.
Hence my appeal: let us indeed be generous. Let us be innovative, for up to now this has by no means been the case.

Macartney
Madam President, when South Africa achieved the impossible and had a peaceful transition to democracy, the whole world applauded the inspiration which President Mandela gave us. The whole world also applauded the sacrifices made by the front line states in leading up to that achievement: Botswana, Lesotho, Swaziland, Namibia and the other states. All of them have a very specific vested interest in the outcome of these talks because those countries are locked in to a protectionist regime which benefitted them. It was not that they wished it but that was the system. I am not convinced yet that the proposals from the European side are going to replace that dependency which they have been landed with.
I would echo the sentiments from all sides in the House for generosity and I am very encouraged by the unanimity with which this is being approached. This is a time when Europe can come to a conclusion and sweep aside some of the detailed objections from vested interest and come to Cardiff and say to President Mandela: we applaud you, we salute you but not just with fine words but with action. I echo the spirit of the House and I ask the Council and the Commission to take this as one of their top priorities.

Theorin
Madam President, it is regrettable that no real progress has been made in the important negotiations between South Africa and the EU on trade policy. For more than three years South Africa&#x02BC;s democratic government has had to fight against a discriminatory trade policy on the part of the EU. The EU is South Africa&#x02BC;s major trading partner. Nevertheless, some countries are pursuing a protectionist policy with regard to products such as wine, fish and agricultural produce. For example, the EU subsidizes tinned tomatoes and thus completely ousts South African tomatoes from their own market, resulting in growing unemployment. This is particularly damaging because it is primarily women that are affected, each of whom, by working in this industry, supports 7-8 people.
The white population continues to own 87 % of all land. One-third of the population is unemployed, one-third has work and one-third has informal work. The problems facing South Africa are substantial. It will, for example, take at least 20 years to get to grips with the housing shortage.
South Africa is a country that has risen from apartheid and political oppression. There is a broad-based political movement that is resolutely fighting to create a new South Africa - something which none of us who for many years worked in the antiapartheid movement dared even to dream about.
It is especially important that the EU should support this young democracy in its battle for peace and stability and that it should help to increase the prosperity of the country. South Africa has now made further concessions in the negotiations. The Presidency has a special responsibility for ensuring that the EU is now finally ready to sign this agreement. It would be both significant and fitting if Nelson Mandela were to be permitted to put his name to this important agreement for South Africa while he is still President.
Olof Palme once said "Politics is a question of the will' . Now is the time for the EU to show that will!

Wijsenbeek
Madam President, now that South Africa has become a model of democracy, an exception in that part of the world, we in the European Union should do everything to support that process. Let us also be clear: at this time when the Truth Commission under the chairmanship of Archbishop Tutu is working to dispel frustration, hatred, violence and oppression, a word of support and appreciation, admiration even, is worth a lot. Certainly, when we hear Mr Cook, as President-in-Office of the Council, in his speech earlier saying that we must do everything to promote democratization in the world and we then proceed in a childish, indeed, petty manner to refuse to allow access to our market and to sign an association agreement, then I think there is only one thing we have to add for the British Presidency: no Presidency has more to do than the present Presidency in Cardiff, when President Mandela, winner of the Nobel Peace Prize, comes to speak to all the members of the European Council, in order to hand him an agreement ready to sign.
We are counting on the British Presidency to know clearly how to play things, but we also know that the resistance does not emanate from the Commission and it is not Parliament that is resisting the agreement. It is the fault of the Council and the Members of the Council that no agreement can be reached and that does not do you credit, Mr Cook.

Spiers
Madam President, I too welcome the steps that have been taken to conclude a trade agreement under the British presidency and the personal commitment of the President-in-Office but I hope that these efforts will be rewarded so that when President Mandela comes to Cardiff he will not simply be thanking European leaders for help in the past during the apartheid years but will be able to thank them for taking steps to achieve a full and fair trade deal.
Commissioner Pinheiro said that the need was for a political commitment informed by sound economic analysis. I have to say there is also a need here for a moral dimension; a recognition that business-as-usual EU agricultural protectionism is causing real suffering in South Africa.
Mr Henderson mentioned the work of the EU South Africa delegation but what are we to say when we meet South African Parliamentarians who tell us that surplus EU beef in Namibia is destroying beef production in Southern Africa or that subsidized EU fruit and vegetables are undercutting domestic production and destroying the South African canning industry.
Earlier this year the largest canning firm in South Africa laid off two thousand seasonal and four hundred permanent workers. High tariffs in the EU and cheap EU subsidized exports to South Africa were cited as the major factors. In the context of up to 50 % unemployment, the impact of those job losses is clearly disastrous. If the EU had been more forthcoming three years ago, this might have been avoided and those jobs saved.
One could go on product by product, category by category. There are also as the President-in-Office I am sure knows, serious problems with regard to dairy products and the South African Government needs more time to conclude a regional strategy before it opens its markets to further imports of subsidized products from the EU. The problem really has been this going on category by category, this book-keeping attitude and what is obviously now needed is the generosity and goodwill that various Members have spoken of.
I should say in conclusion and with regard to Mr Wijsenbeek's remarks about the problems in the Council, that if some of the Members here had been able to convince their own national governments of this attitude we might be having fewer problems now. It is at least heartening that this House is united.

Junker
Madam President, ladies and gentlemen, the European Union shares in the responsibility for the democratic and economically prosperous development of South Africa. Given the tussle over questions of detail which are at times hard to explain, it may reasonably be asked what market disruptions the European Union has to fear. It is the largest trading community in the world. Millions of jobs in our countries are accounted for by export activity which makes a major contribution to European prosperity. However, with 373 million consumers the European Union is also an exceptionally important import market which should not be subject to any protectionist barriers, and certainly not in relation to developing countries which are dependent on access to world markets and which urgently need the income from exports in order to deal successfully with their transformation processes.
South Africa also urgently needs a trade policy outlook in order to secure sustainable development in peace and stability. This will be to the benefit of the entire region of southern Africa, as has rightly been said a number of times. Truly it is time to launch a non-discriminatory trade system with South Africa and to settle any unresolved questions without further delay, so that the negotiations on the free trade agreement can be concluded favourably at the Council meeting, without any smallminded restrictions.
There is an old saying: where there's a will, there's a way. If the European Union has the genuine will - and this applies to the Council in particular - to arrive at a positive conclusion, it will also strengthen the readiness of its negotiating partner to compromise. I rely on the good will of the British Presidency to achieve a breakthrough and so to set the course for the positive development of Africa and thus of the whole area of southern Africa.

Smith
Madam President, I begin where Commissioner Pinheiro finished, namely on political commitment. What has happened to the European Union's pledges of support to the process of consolidating South Africa's fragile democracy? When they meet him in Cardiff, can European leaders look President Mandela in the eye and say we have fulfilled that promise? South Africa in the past year has made tremendous strides and tremendous efforts in transforming and opening up a closed economy. What has the EU done? The EU has continuously changed the parameters on the basis of which South Africa entered these negotiations. From a five-year transition period to no transition period at all, from an FTA based on maximum asymmetry to an FTA in strict conformity with WTO rules. The European Union still insists on parallel dismantling of trade tariffs in certain key sectors. I am rather struck by the irony of the Commission now using South Africa as a model for future Lomé trade negotiations. This will be the test after South Africa itself was refused Lomé trade access as it was not a typical Lomé country.
We cannot be complacent about the consequences that these negotiations are having and will have on the people of South Africa. In Capetown this Friday over 30 representatives of South African trade unions and members of the South African parliament will be meeting to discuss the impact of the agreement on the livelihoods of the South African people. It is their duty to find out what their concerns are and I hope they will be addressed in the coming months. Also, parliamentarians from the SACU countries recently presented their written submission to Commissioner Pinheiro and to the UK presidency. We need to look at these concerns and I would ask that copies of this document be made available to all Members of this House. As far as regional strategy goes, I would suggest to the Commissioner and to the UK presidency that we consider a statement of intent signed by the Commission and South Africa, which would address how regional concerns would be addressed in the future.
Finally, until this proposed free trade agreement is acceptable to our parliamentary colleagues in South Africa and in the SACU countries, I, for one, will consider that this proposed agreement is not acceptable and I would urge this House to vote the same way.

Barros Moura
Madam President, I share the general concern over what already seems to me to be the excessive prolongation of negotiations with South Africa. And, like all my colleagues, I consider that the European Union should honour its responsibilities and support the consolidation of a non-racial democracy in South Africa by means of economic development. That economic development will also enable South Africa to deal with the crime and lack of security that have been mentioned. I also agree that the European Union should support Nelson Mandela, that great world figure, whom we look forward to seeing soon in Cardiff.
But I would like to know, and I therefore ask Commissioner Deus Pinheiro, who will have no difficulty in replying in Portuguese, what is happening? What is holding up an agreement which will bring a fair deal both to South Africa and, of course, to European producers? Is it just a matter of groundless European protectionism or are there serious reasons? Which agricultural and other products are causing most problems, and what alternatives might we find to exclusion, pure and simple?
Another thing: what effect will an agreement between the European Union and South Africa have on its neighbouring countries? And how can the Lomé rules be applied to South Africa without detriment to most deprived ACP countries? That is to say, how can we help South Africa to fulfil its role as the driving power of economic development in Africa, in our mutual interest, genuinely but without undue domination, and with due consideration for other states in the region?

Henderson
 - Madam President, I should like to make one or two remarks in conclusion. I do not propose to cover the points I made in my initial remarks or in the remarks made by Commissioner Pinheiro. One thing I would like to say is that I am impressed by the sense of priority given to this issue from all quarters in this Parliament and to the need to conclude a trade agreement. It is very important to have that bedrock of support. I am pleased to see that support also extended into the important area of agriculture, one of the more difficult areas in negotiation.
A number of participants in the debate raised the question of what kind of flexibility will be shown? Is the Commission in a position where it can show flexibility? The starting point is that there needs to be more flexibility on all sides if negotiations are to proceed more swiftly to a conclusion. In the event that more flexibility is shown by the South Africans - and I hope that will be the case - on the basis of the Council discussions on this matter at an earlier stage this year the Commission has some flexibility to be able to respond to any initiative which might be forthcoming from our South African colleagues.
On the matter of the South African Summit and President Mandela's visit, I would think that all of us would very much welcome that visit in the broadest political context. My honourable friend Mrs Kinnock said that it would be icing on the cake at Cardiff if an agreement could be reached by then. I agree that it would be icing on the cake but the importance of President Mandela's visit is that it can act as a vital spur to us all to proceed as swiftly as possible through the issues, not making concessions where we cannot make concessions and not ignoring issues which need to be addressed. But it is a spur to us all to tackle those issues in a positive and constructive way so that even if the icing cannot be on the cake at Cardiff, it can perhaps be there by the autumn.

Pinheiro
- Madam President, I think we are all agreed that the moment of truth is at hand for both sides, and within the European Union this means the Commission, the Council and Parliament. Let me be clear that the British presidency has been extremely important and of great assistance in pushing forward this dossier in a manner which I would like to emphasize publicly. As we have all heard, Parliament has been pushing and putting all its political weight behind getting more flexibility and more generosity.
Having said that, I should like to touch upon two or three points which might be important. Firstly, this round of negotiations was not postponed because of the Commission but because the South Africans were not ready. They wanted a further postponement which we refused for one simple reason. If we have our meeting on 10 and 11 June, there is still a possibility, if we work hard, of reporting to Coreper. We must do our utmost in order at least to give the British presidency a broad draft of what we would be seeking a blessing for in Cardiff. We cannot miss that opportunity. I have consulted my colleagues who have been more involved in the negotiations and they are prepared to work 24 hours a day if need be in order to push it as far as possible and give the British presidency a chance. This is not easy but we know it is willing to take it.
Secondly, regarding BLNS countries, of course we have been looking at it very seriously and I would like to tell Parliament that as we did for economic union in UEMOA we are prepared to devise a similar programme in which for a transitional period the loss of income from customs will be compensated. In the medium and long-term there is an automatic compensation but in the short term problems may arise and we have told the countries we are ready to assist them during that period.
Another matter I should like to touch on is that it may have been true a few years ago that beef exports from the European Union were competing unfairly in South African market but not for in the last two years. What is happening now is that the cheap beef from Argentina comes at such a price and with such devious ways of entering the country that this is really the problem now. We have slashed export subsidies by nearly 80 % in order to make sure that is not the case as regards South Africa.
As regards wine, imports from South Africa have increased 150 % even with the current tariffs so you will understand that having excess wine production in Europe there is some concern about liberalizing the market. This is not some kind of book-keeping. We are talking about serious issues and we have to be coherent in the different aspects of our policies.
Finally, regarding asymmetry, this has nothing to do with WTO. We can have whatever asymmetry we want. What we cannot do is come up with an agreement and afterwards WTO tell us it is not compatible. So, we must make sure that what we propose to WTO is compatible so we will have legal security with regard to our agreement. My final point is that the political commitment made by the European Union to South Africa justifies the kind of flexibility the Commission has proposed. I sincerely hope the Council will approve what we proposed which is a significant step forward as regards the European proposal. Unfortunately, it is up to the Council to decide.

President
Many thanks, Commissioner Pinheiro.
I have received six draft resolutions in accordance with Article 37 paragraph 2 .
The debate is closed.
The vote will take place tomorrow at 11 a.m.

Economic policy guidelines of the Member States and the Community
President
The next item is the debate on the report (Doc. A4-0193/98) by Mr Gasòliba i Böhm on behalf of the Committee for Economic and Monetary Affairs and Industrial Policy on the Commission's Recommendation for the Broad Guidelines of the Economic Policies of the Member States and the Community (drawn up in conformity with Article 103 (2) of the Treaty establishing the European Community (COM(89)0279 - C4-0291/98)).

Gasòliba i Böhm
Madam President, ladies and gentlemen, the debate on the broad economic policy guidelines ensures proper transparency and participation in relation to the correct framework for the management and direction of the euro and the first steps and guidelines for monetary union. The broad economic policy guidelines are essential for defining the European dimension of economic and monetary policy, as demanded by monetary union and the euro.
The report I have the honour of defending before the honorable Members expresses a broad consensus on the part of the Committee on Economic and Monetary Affairs and Industrial Policy, where it was approved virtually unanimously with no vote against. This consensus should be adopted by all the European institutions too - the Council, the Commission and Parliament - because the construction of monetary union and the euro requires very extensive, firm agreement, precisely in order to guarantee the necessary solidity and strength of the European currency, and sustainable growth of the EU economy. That can lead to higher employment levels and thereby allow us to resolve our most serious problem, unemployment.
The report emphasizes and respects the prime objective of maintaining price stability, but it also gives important indications about aspects essential to orienting the European economy and guaranteeing steady growth with high employment levels. So it stresses the importance of investment, which will be favoured by an economy with a low inflation rate and low interest rates. Everybody knows that favours investment, and also saving. The report also recommends that the conditions set out in the Stability and Growth Pact are adhered to as rigorously as they deserve to be, and in accordance with the agreement made when that pact was established. That means reorganizing public finances and continuing with the processes of convergence and economic coordination between the Member States.
The report does not envisage an increase in fiscal pressure because we believe that could distort investment. However, investment is taken into account as an important factor for growth in the European Union. The wage factor plays an extremely important role in this growth, and is considered essential in order to ensure a better level of employment. So there is a proposal to decrease the non-wage costs which penalize job creation.
Social security benefits must be maintained, but consideration has to be given to their funding, based on economic growth itself and on appropriate agreements between the economic and social players, so that these agreements can offer positive results thanks to fruitful social dialogue.
The report also stresses the need to increase the competitiveness of the European economy in an open and globalized situation, such as we have at present. The report mentions several important aspects for obtaining these increased levels of competitiveness. The development of infrastructures which favour an improved system of production, education and workrelated training, and research and development are key elements to ensure the success of the European economy in the immediate future. Wider competition is also important.
Finally, I should like to emphasize that there are still barriers in the European internal market which should be removed. There are inflexibilities and major distortions in basic sectors such as energy and telecommunications, so we must attain greater flexibility and liberalization.
It is important that, right from this initial point, the proposals made by the Commission and by Parliament in this report are borne in mind. So I think it is important to give prior notice that tomorrow we will present an oral amendment to insist that when Ecofin adopts the broad guidelines for economic policy, they take full account of the proposals made by the European Commission and Parliament.
Madam President, ladies and gentlemen, we now have monetary union and the euro. We do not see them as the end of a process, but as the start of a new stage which should see the participation and coordination of all the powers of the EU. Obviously, it should also lead us achieve a new political and monetary dimension for the European Union.

Metten
Madam President, the euro will arrive on 1 January 1999, but it will not come alone. The broad guidelines of economic policy make that clear. In particular, the guidelines indicate what policy mix Europe needs. Because the main task assigned by the Maastricht Treaty to the European Central Bank, as the body responsible for implementing monetary policy, is to maintain price stability and it can only support economic policy for growth and employment when that has been achieved, price stability has become more or less the anchor of the European policy mix, in other words budgetary policy and wage development must be geared to ensuring that no inflationary pressures are unleashed. Should that happen, the ECB will react without fail by increasing interest rates. That would damp down economic growth and employment.
Because of the way the Maastricht Treaty is formulated, budgetary policy and wages policy are more or less prisoners of the price stability objective. At present that is not a problem, because at the current inflation rate of 1.4 % we already have price stability. In order to be able to maintain price stability, the Member States and social partners must not only be prepared to adjust their policy when necessary but must also develop instruments for rapid reaction. In the face of an inflationary threat, for example, it would have to be possible for collective agreements to be adjusted or for taxes to be increased temporarily. The broad economic policy guidelines we are discussing today will be much less discretionary in character in the period after 1 January 1999, when the euro and European monetary policy are in place. Ensuring that inflation does not rise in one's own country is no longer enough. If average inflation rises as a result of policy in other Member States, the ECB will react by raising interest rates and dampening growth. In short, making sure that one's own affairs are in order is no longer enough. All countries of the euro Eleven must go along with this. At the present time of course, inflation is not the greatest problem in the European Union. The greatest problem is still unemployment and the inadequate growth in the large countries which is a major cause of it.
In order to promote growth it is important for the European Union itself to develop the growth impetus which in the past year has largely come from outside the Union. However, I see important elements that could begin to generate it in the policy mix that the Commission has put before us. Budgetary policy in 1998 will be less strict than in 1997, when strenuous efforts were made. Monetary policy will be somewhat expansionary, because the interest rates of the peripheral countries will drop to the German level and wages need no longer necessarily lag 1 % behind rises in productivity. I see a clear stimulus emanating from this combination of factors for the growth of the European economy. That is the positive signal given by these broad guidelines.

Herman
Madam President, ladies and gentlemen, we view the recommendations of the Commission as balanced and fair. They seek a measure of compatibility between the requirements of a balanced budget and monetary stability on the one hand, and the aims of sustainable growth and increased job opportunities on the other. They contain specific appeals to certain countries and certain operators in the economic world. All this is fine, but what concerns us and what concerns the entire Parliament, I believe, is the outcome we should expect from these recommendations.
Some commentators and keen observers of political life have already pointed out that the entire system does not meet expectations, in the form of an economic government or coordination procedures which genuinely ensure that the Member States will adopt these recommendations. There is therefore considerable room for anxiety. In fact, this would not be the first time that bold announcements by statesmen at the highest level, at the summit, whether in Amsterdam or Luxembourg, have been gradually and insidiously stripped of their content by concerted action, an unnatural alliance if you wish, between national administrations to retain power and since the recommendations of the Commission must pass before this body, the Monetary Committee, we can be sure that everything they contain that is relevant, with perhaps a few rough edges too, will be peeled away by all those despots who wish to retain their powers and who, between them, assume they have a duty to offend no-one. In this way, they prevent the Commission applying recommendations that might be misunderstood or ill-received by one or other of the Member States.
This is a type of conspiracy with which I have been very familiar for some time and which, unfortunately, is unlikely to change even though we have made a further concession. Article 103 was formulated a long time ago and we might hope that this article, which today should be interpreted in a wholly different way since we now have the Central Bank and we now have a single monetary policy, might make a contribution towards coordinating economic policies. I believe the device on paper could be good if the recommendations from the Commission were actually Commission proposals. We are well aware that when a Commission proposal is stripped of its real meaning by the Council, the Commission can withdraw it. Here, we are talking of a recommendation and it cannot be withdrawn. The result is that we do not know what the "Ecofin' Council will do, or which document it will be working on. But we might reasonably fear that this document does not contain any of the more relevant recommendations.

Crowley
Madam President, I would like to welcome the Commissioner to the House and thank him for the communication on the broad guidelines to economic policy. I would also like to pay particular tribute to our rapporteur who has brought forward a very balanced document which recognizes the new reality in which we now operate. We are dealing with a global market. It is important for us as a Union to take account of our competitiveness as well as creating new opportunities for employment and growth.
On top of that I believe the present Amsterdam Treaty for the first time underlines the importance of employment within the overall European Union development. It is important for us as a Parliament to recognize our role in bringing to fruition the ideas of what the people of Europe want to see. They do not want to see broad economic guidelines debated here once a year, having no effects to them on the ground. They want to see positive developments and I am suggesting tonight that there is a number of positive things that we can do within this Parliament.
Firstly, we can look at our own role - look at the legislation that we bring forward and make sure that it does not impact negatively on the employment creation and on encouraging innovation and entrepreneurship within our Community.
Secondly, there is a vast wealth of experience and knowledge of different systems, of different methods of employment and employment policy within this Parliament. May be instead of dividing ourselves into the left and the right or the free marketeers and the laissez faire or whatever, we should come together and try and bring the best practices from all those ideas into one united policy.
Thirdly, as the budgetary authority we should be more focused in how we allocate funding in the social fund and the Structural Funds to reward those that are achieving the most with regard to meeting the guidelines as laid down by this House. Let us not forget that we have within our ambit a raft of powers and a series of measures which we can utilize.
Our rapporteur has already mentioned a couple of them in his own speech and in his report. I would like to focus in particular on the SME sector and on the kind of supports that we can put into place at Community, national level and at local level. The biggest engine of growth and employment in economic terms should be given extra support.
Finally, could I point very briefly to where we should go in the future. For the 21st century our motto should be giving our citizens the tools to cooperate and to work within the new Europe.

Boogerd-Quaak
Madam President, both the broad economic guidelines and the rapporteur's work once again reveal that a number of measures need to be taken by the Member States and by the European Union as a whole after EMU comes into effect. I would like to follow on from Mr Herman when he said that in fact we already know what has to be done but that we lack the resources to bring about real coordination. Precisely now that EMU must be helped on its way, it is extremely important that the Member States take the necessary measures, in particular to regulate the labour market in such a way that unemployment is brought down.
In this connection I would point to a number of developments in the Asian world, where events are governed by factors completely different to those in Europe. We cannot sit on our hands and look on. We must be very active indeed in implementing the proposed measures. However, we have been proposing these measures for a number of years and, in my opinion, things are not moving fast enough. I therefore ask the Commission to urge the Council to implement the proposed measures as soon as possible.

Theonas
Madam President, this proposal by the European Commission is confirmation and proof positive of the hardline, in our view, single-minded approach which colours all Union policy and which is perfectly illustrated in the Stability Agreement, the application of which is already speeding up apace.
The new form in which the policy guidelines have been presented is our first confirmation of the official division of the European Union into a union of fast- and slow-track Member States. This division by the European Commission is wholly unacceptable. The Commission, in its proposals, insists on even stricter economic policy, on continuing and hardening political austerity, on promoting privatization, on deregulating industrial relations, on reforming the national health system and on reducing state funding for the national health system. And yet it is precisely this approach which is responsible for the unacceptable social ills and unemployment in the Union.
The report by the Committee on Economic and Monetary Affairs and Industrial Policy takes the same approach. Not only does it heartily accept the findings, conclusions and guidelines of the European Commission; on several points it even outshines the Commission by demanding yet tougher measures to the detriment of the workforce and to the benefit of private-sector profitability. It demands that individual and collective wage increases be subjugated to monetary stability and profitable investment, it seeks a flexible wage structure which depends on productivity, region and sector, it calls for the abolition of state aid, it suggests that privatization should be speeded up, that private-sector capital should be injected into public-sector investments and that intervention is needed in pension funds and is indifferent as to the consequences which this will have on social protection in the Union.
Mr President, we intend to vote against this report, which, unfortunately, does not record our "no' vote to the Commission. We refuse to accept and endorse a policy which sacrifices the rights of the masses to the interests of a handful of bankers and monopolies. We support the plight of the workers, which is taking on ever-increasing dimensions, and we shall continue to do so.

Hautala
Madam President, this report had to be produced hastily, and that may be the reason for its general nature. All Parliament can certainly unite in the opinion that the coordination of economic policy is now, with the birth of the euro area, more important than ever. This will certainly stand us in good stead for continuing cooperation with the Commission.
The Commission has for the first time taken a genuine step forward in the direction of concrete targets for employment with these broad guidelines which they have laid down for the economy, and our group is very satisfied. We wish to emphasize that employment must really be the focal point of the coordination of economic policy in the future. The costs of unemployment are a heavy drain on national economies. We must absolutely ensure that national economic resources are targeted at growth and sustainable action.
Our group naturally wishes to stress that growth, which is what we are aiming at here, should be more purposefully sought in connection with the preservation of the environment. It is quite astonishing how hard it has been to move along in this direction, although the formulae are pretty well-known to all. We should be able to make it more and more costly to pollute the environment by fiscal means, and correspondingly be able to then lower income tax. Hopefully, the requirements of the Amsterdam Treaty will make this ecological tax reform more likely and more realistic now that we are embracing the euro.
We are living in a decisive age when the European Central Bank will surely take a part in economic policy that is just as large as we allow it. My group would like to state that it will be terribly important that a counterweight is created through a truly common economic policy, so that the ECB does not ascend to a position that is too dominant.

Formentini
Madam President, it is the first time since the decision of 2 May that this Parliament has been asked to give an opinion on the subject of economic policy, in relation not to a decision-making act, but to a recommendation of the Commission to the Member States on their policies. We know the extent to which these policies are becoming delicate and difficult to manage, precisely because of the decision to complete the third phase of the Treaty and therefore of economic and monetary union.
Now, the states only have control over taxation, while control over the budget has been taken away. All of this may create problems for the various areas in the individual states of guaranteeing the competitiveness of all areas. The French economist and banker, Antoine Michel, said that there have to be three essential conditions for an area to be competitive, since competition will now no longer be between companies but between area-based systems: an area-based system must be able to have efficient administration, fair and if possible light taxation, and infrastructures whose purpose is to be competitive.
I think that it is the duty of every Member State to ensure that there are no forced transfers of resources from one area to another, because this would constitute waste. I am referring in particular to Italy, where there are already large-scale programmes for the transfer of resources from productive areas to areas that are at present assisted. This will create serious difficulties; in my opinion this is not a policy of rebalance but a policy of imbalance. It would therefore be appropriate if it were in fact the European Parliament which told the Member States that resources should especially remain and be invested where they are produced, since the whole of Europe will grow in accordance with these virtuous policies, whereas there would be serious consequences if this were not to occur.

Hendrick
Madam President, can I start by thanking the rapporteur, Mr Gasòliba i Böhm, for his report on the broad economic guidelines. I, along with the rapporteur, welcome the Commission's emphasis on achieving a high level and rate of growth of employment. It is clear from those guidelines that we require a policy mix which is favourable to economic growth. However, what is also clear is that with inflation averaging 1.6 % in those countries within the European single currency zone, perhaps a slightly more relaxed monetary policy, combined with an increase in internal demand, will increase much needed employment across the European Union.
The British presidency has promoted the idea of a flexible labour market and this, along with an increased demand for internal products, services and capital, in addition to growth through exports will be, I believe, the catalyst for those essential jobs that we need here in the European Union. Reference has already been made to the birth of the euro and I believe, along with many other people on this side of the House, that the euro will improve the operation of the single market and in the medium to long term increase jobs in general across the single market. Many opponents of the euro have claimed in the past that job losses have resulted from Member States meeting the convergence criteria. I would suggest that in the longer term job increases will be the order of the day as a result of these developments.
The future and security of Europe will also depend on the ability to get as many as possible of Europe's twenty million people back to work. The depressions in the early part of century and in particular the 1930s led to mass unemployment and two world wars. Jobs are being created but not quickly enough because jobs are being lost nearly as quickly. The unemployment figures today are nearly as high as they were when the Essen summit took place not long after my election to this Parliament in 1994. I believe that the conditions are right for job creation now and, as we say in my country let's make hay while the sun shines. With low inflation we can now do that. I, therefore, suggest that the Member States of the European Union take that course of action.

von Wogau
Madam President, ladies and gentlemen, the introduction of the single European currency on 1 January 1999 in eleven Member States of the European Union has been agreed. From this date onwards, the European Central Bank will be responsible for a single European monetary policy. That is why it is becoming ever more important to take further the co-ordination of national economic policies. It is necessary on the one hand in order to secure the long term stability of the European currency, and on the other in order to create the appropriate framework conditions for growth and employment. Decisions taken by the European Council on economic policy guidelines are a particularly important instrument in this regard. The European Parliament collaborates intensively in this matter, according to the provisions of the Treaty.
In this context, on behalf of the Committee for Economic and Monetary Affairs and Industrial Policy, I should like to congratulate my colleague Mr Gasòliba i Böhm on his excellent report. In its recommendation, the Commission gives guidelines which are directly addressed to the individual Member States in order to arrive at healthy state finances. I welcome these detailed recommendations which are targeted at the specific situation of the country in question. In my view, they are more useful than generally formulated proposals which are directed at all countries without taking account of the circumstances of each case. I expect, and this is no more than the application of the Treaty, that the Council will decide on the basis of the Commission's proposals, because in the first place the Commission has made some very sensible proposals here, and in the second the Treaty itself prescribes that this is the procedure to be followed.
The stability and growth pact is an important and innovative instrument for the greater co-ordination of national budgetary policies which is essential. In good times, the objective is to have balanced budgets or surpluses, so that a policy of assisting growth can be pursued in economically difficult phases. As a Christian Democrat, I would describe this as an economic policy following the rules of the Bible, which always tells us that in the fat years we should put by stores for the lean years.
In my view, the importance of the stability policy for growth and employment cannot be underlined often enough. Today's historically low long-term interest rates are the result of the consistent stability policy of recent years. Low interest rates mean confidence in the stability of economic development. This is the way in which stability policy creates the environment in which growth and the resultant employment become possible.
The first steps towards greater co-ordination can also be discerned in tax policy. The code of conduct for corporate taxation recently adopted by the Council points in this direction. We are also seeing the first signs of a solution to interest taxation. A switch from the principle of country of destination to that of country of origin in the case of value added tax remains on the agenda.
However, the objective of greater co-ordination of national tax policies is not complete harmonization. The internal market lives on competition. That also includes competition about which state offers its citizens and businesses the services which are expected from the state on more favourable terms. That is why this competition between the systems will also be an essential component of European tax policy in the future. There will also be a greater need for co-ordination in relation to the competition policy of the Community and its member countries, the Community's structural policy and the creation of a European infrastructure. There is also a need for action in relation to the ecological and social framework conditions of the European market economy, because our objective is to create a European economic policy which is based on the principles of an ecological and social market economy. The report from my colleague Mr Gasòliba i Böhm is an important contribution towards this!

Cars
Madam President, it is now and in the near future that decisions will be made on all of the questions that will determine the course taken by the European Central Bank, which - if I am correctly informed - starts work this coming Monday.
This is all very well, but where do my country and its government feature in this picture? As a European-minded Swedish liberal who belongs to a party that has clearly declared itself to be in favour of European cooperation, I find it sad - distressing, in fact - that my own country&#x02BC;s government has denied itself the opportunity to influence these decisions which are so vital to future employment and prosperity throughout Europe.

Féret
Madam President, on 2 May last I voted in favour of a single currency with cautious enthusiasm. I voted for the motion because I believe that the euro is better than a Belgian franc bound indefinitely to the German mark alone and it is better than the mighty American dollar.
But in this Assembly I have always expressed the opinion that the arrival of the euro will not affect unemployment, which hits more than 20 million Europeans and which is caused partly by relocating companies in countries where manpower is 40 to 50 times cheaper than in Europe and partly, which comes back to the same thing, by the immigration of populations from outside Europe that expands the ranks of job seekers. Nor can I believe any longer in the dogma of interest rates which remain constantly low. A euro, as strong as it is, will require, whatever anyone says, gradual increases in interest rates.
I therefore invite the Commission to assume a more realistic, rather than an optimistic approach and to exhibit greater courage in its decisions on the most pressing matters to protect the jobs we still have and finally to inspire those young people who no longer believe that they have a promising future.

Randzio-Plath
Madam President, the submission of the guidelines of economic policy by the Commission does indeed this time bear the hand-writing which was previously inscribed in the family album of European employment and economic policy by the Amsterdam resolutions and by the Luxembourg employment summit. This gives us hope that at long last an appropriate and properly balanced policy mix is emerging for the economy of the European Union. That is why the EU Finance Ministers are called upon to launch Community strategies for investment and employment, and finally to undertake co-ordination of economic policy in such a way that it merits the name, as it is set out in the Maastricht Treaty.
The European Union must place economic policy in the service of employment. Around a third of current mass unemployment is caused by a failure of overall economic co-ordination. The Maastricht Treaty must at long last be implemented in economic and employment policy as well. In addition, we need growth which is supported by investment and provides employment. We need not only an upturn in economic activity which exploits unused capacity, but above all a medium-term process of growth which creates new productive capacity and new jobs. A decisive role will be played by an increase in the investment quota which continues to be quite scandalously low!
The pre-conditions for this sort of growth process supported by investment are more favourable now than they have ever been, and the Commission rightly draws attention to this. Now it is essential to deploy public sector investment as well and to dress the Delors White Paper infrastructure programmes for modernisation and innovation in new clothes. A European investment pact must lead to public resources flowing into productive uses, into an investment alliance between states and private business. In the process, thought must be given in particular to the stimulus effect for small and medium-sized businesses.
Entry into the 21st century cannot be achieved solely with monetary union. In the interests of our fellow citizens, as I have already said, we need at long last to have a European economic and financial policy and more co-ordination, . The Commission is called upon to see to it that European economic research institutes draw up an annual report on the state of the economy and of employment in the European Union, as a contribution to steering European policy.

van Velzen, Wim
Madam President, it is a rather odd situation that, although I am officially the rapporteur for the Committee on Employment and Social Affairs, I am the last speaker but one; but that is a formality that I need not dwell on.
The final report by Mr Gasòliba and the Commission proposal, in my honest opinion, represent clear progress compared with the previous reports. More balanced attention is devoted throughout to macroeconomic policy, on the one hand, and to structural policy on the other. That does not mean that I am completely satisfied. Thus, in my opinion, when analysing stability, employment or unemployment is systematically underestimated as a factor in it or as a hindrance to it. On the other hand, flexibility, of which the value and necessity are fairly controversial, is systematically overestimated.
I considered and still consider that the guidelines offer little in the way of a concrete strategy for the stimulation of demand, to which the report itself urges substantial attention to be devoted. The only thing about which a lot is in fact said is the control of wage development, and I get the impression that this relates mainly to wages governed by collective agreements. When I look at experience in my own country, the Netherlands, the polder model, I can report that there is extensive control of wage development as far as collective agreement wages are concerned, but that there is a scandalous trend in non-agreement wages, where the top incomes in firms in which wage rises were limited to 2.5 % have gone up by over 30 %. I would appreciate it if that aspect were also covered in the reports of the Commission, for it is ludicrous to exert constant pressure for low wage rises under collective agreements and to say nothing about the rampant growth in wealth at the top.
I think it important to ask for a few points of action, and the most important one for me is that an effective form of parallelism should finally be created between the Council and the Commission in preparation and decision-making relating to employment and macroeconomic guidelines. There is too much evidence of compartmentalization in which people talk in complete isolation from one another at both staff and Council levels. I once proposed that the decision-making should take place in a Finance, Ecofin and Social Affairs Council, and I happily repeat that request, that advice, here. Otherwise you will not arrive at a serious, integrated and balanced approach.
Finally, it surprises me to hear arguments constantly presented for more regional differentiation in the field of wages. I favour the argument for wage development which takes account of or is based on productivity, but I am against pressing for regional differentiation throughout Europe based on the pattern in Germany. If you think that can run smoothly and without doing damage, I advise you to look at developments which have taken place in the United Kingdom.

Lienemann
Madam President, ladies and gentlemen, Commissioner, the only question weighing on the minds of Europeans today is whether the major economic guidelines submitted by the Commission will tackle the unemployment problem effectively and substantially.
My reply to this question is clearly that if all the necessary steps are not taken, it does not add up. I am pleased to note that the report by Mr Gasòliba and the Commission debates have persuaded our Parliament to insist on the need to revive domestic demand and also to insist on the urgency of revival through investments. But I am sorry that the question of reducing working hours has not been properly expressed by the Commission. And I can only view as a provocation the Commission text concerning the implementation of a reduction in working hours across the board, which states that the Commission considers that this raises serious problems and would prefer a more diverse, negotiated solution.
In my view, this is either too much or too little. It is too much, because clearly public opinion in France has regarded it as a challenge to the French government. And that lies outside the jurisdiction of the Commission. It is too little, because if we were to take a tally of all the issues that raise problems today in terms of employment and the economic future of Europe, much is missing. I would have liked to see the Commission dispute with equal vehemence, for example, increased flexibility, a drop in wages, the fact that part-time work prevents an increasing number of wage-earners leading a dignified existence, in other words it slows down domestic demand and an upsurge in consumption, which is to say growth.
Either the Commission draws up a list of all the issues that might threaten growth and the future of Europe, or it should abstain from commenting on national issues; it is also regrettable that the Commission should refer to the texts produced by European employers in this respect. At all events, I am pleased that Mr Gasòliba and the Commission have reinstated the proposals in Mr Delors' White Paper, which seem to me to be much more relevant than the existing Commission proposals to solve the unemployment problem.

de Silguy
Madam President, ladies and gentlemen, this preparatory year in which we draw up the major economic policy guidelines is of particular importance. Your House has understood this well. I would praise the professionalism with which you have contributed to the drafting of those guidelines. The quality and consistency of the report delivered by Mr Gasòliba must be stressed, I offer him my compliments. I am also pleased, on behalf of the Commission, to note the support which the European Parliament showed for his recommendations concerning the major guidelines for economic policy in 1998.
This support is important for two reasons. Firstly, because it emphasizes the operational nature of these guidelines, the first of their kind following the decision to enter Economic and Monetary Union. Secondly, because it confirms the consensus in favour of the contents of the European economic policy. The operational nature of the coordination of economic policies depends both on the framework of that cooperative spirit and the manner in which it is deployed.
With regard to the coordination framework, following implementation of the Economic and Monetary Union, the major guidelines are designed to serve as a genuine programme of European economic policy. Hence, the 1998 Broad economic policy guidelines fit in the context of real multilateral controls, whereby the strict coordination of economic policies, which remain subject to national jurisdiction, assumes its true importance.
This is why the European Councils in Amsterdam in June 1997 and in Luxembourg in December 1997 invited the Commission to formulate recommendations under the terms of Article 103, paragraph 4, in the situation where a Member State might ultimately compromise the successful operation of the Economic and Monetary Union. Those very European Councils requested that the Broad economic policy guidelines take account of long-term employment programmes and employment guidelines. The Commission will ensure that these duties are performed consistently and it will assume full responsibility in this respect.
How do we implement this framework; and how do we monitor this coordination? Quite rightly, this year the new major guidelines include specific recommendations for individual countries, with regard both to public finance and structural matters. Similarly, the recommendations proposed by the Commission, with regard to the euro area as a whole, coincide with the arrival of the euro and represent quite a novelty. These various recommendations, which come in the wake of the resolution of the European Council in Luxembourg are vital. Amending them, to arrive at a less precise and therefore more restrictive formulation, would not satisfy requirements concerning the coordination and monitoring of economic policy in Europe.
But in order to render the Broad economic policy guidelines more operational in terms of monitoring and coordination, we need a more accurate definition of the function of all those participating in economic policy in Europe, including the European Central Bank with regard to monetary policy and its contribution to Community goals, Community institutions in terms of balancing the entire economic policy, national governments in terms of budgetary policy and all social partners in terms of fixing wages. In the light of this, Mr van Velzen, I do not think the Dutch example that you mentioned can be instituted across the board in Europe. It seems to me more of a local concern. As to regional differentiation, everybody generally believes this to be necessary. The example of Italy, especially Southern Italy, provides the proof; we must take due account of productivity.
You are aware of the Commission proposal regarding the broad guidelines. This meets the requirements in terms of consistency and comprehensiveness, whilst complying with the principle of subsidiarity associated with the implementation of economic policies in Europe. I therefore back the resolutions put forward by a number of you, including Mr von Wogau, Mr Herman, Mrs Boogerd-Quaak and Mrs Randzio-Plath, that the Commission, when striving to adopt the new GOPES, should prevent national feelings prevailing over Community interests, or those of the Economic and Monetary Union.
In the same vein, I would remind you that the Treaty stipulates that decisions concerning the broad economic policy guidelines must be approved by a qualified majority, these are the terms of Article 103.2 of the Treaty. Hence the Commission recommendations may be adopted by the Council by a qualified majority. There is no need to seek unanimity at all costs. To make sense, coordination of economic policies must be the operational instrument that guarantees genuine multilateral monitoring, organized and administered by the Commission, in close liaison with your House. At all events, this is the aim of the Heads of State and Government, as reflected in the conclusions of the European Council in Luxembourg. This is the philosophy of the broad guidelines, which is designed to confer on them an operational nature.
I now come, briefly, to the contents of those broad guidelines, which I have already spoken to you about in detail. I will therefore confine myself to the basics, from a macroeconomic and structural aspect. I would remind you that from a macroeconomic point of view, the broad guidelines for 1998 set out two aims at high level: employment and the success of Economic and Monetary Union. It is for this reason that the Commission is pleased to congratulate your rapporteur unreservedly on the strategies he advocates and I am thinking in particular of item 6 in your draft resolution.
Similarly, as reflected in its recommendation, the Commission endorses the need expressed to achieve adequate levels of private and public investment, as stated by Mrs Randzio-Plath. Your House, Mr Hendrick, is also concerned about the subject of domestic demand. Well, I can assure you, the Broad economic policy guidelines take this dimension of economic policy into account, although demand must not be stimulated artificially. The aim is to ensure that investment and consumption gradually dispense with exports in order to achieve self-maintaining growth in the medium term. Incidentally, the latest Commission forecasts confirm that this dynamic is already underway.
Finally, with regard to structural policies, your rapporteur approves the Commission recommendations, whether they relate to product markets, services, capital or job markets. As the European Council recommended in Luxembourg, the Commission recommendation establishes broad guidelines and an effective instrument promoting sustained convergence between Member States. Hence the Broad economic policy guidelines are focussed more than in the past on measures designed to enhance the growth potential of Member States in order to boost employment.
This is why the Commission attaches such importance to putting forward recommendations to improve competitiveness, the effectiveness of job markets, goods and services, education and information and to render tax and welfare protection schemes more favourable to employment. With regard to a reduction in working hours, your address, Mrs Lienemann, does not, it seems to me, represent the views of the Commission and I can tell you that the contents of the report and the Commission recommendations reflect not more nor less than the contents of the White Paper of 1993, presented by Jacques Delors.
In conclusion, I would like to emphasize that these new broad economic policy guidelines define the resources for monitoring and controlling the coordination of economic policies. This approach, adopted and supported by your rapporteur and your draft resolution is all-encompassing and consistent. The exercise of this coordination function, and I weigh my words carefully, as concluded by the Heads of State and Government must not tomorrow be abused. The implementation of the Broad economic policy guidelines, which is vital to the satisfactory operation of Economic and Monetary Union, essential to the deployment of a coordinated strategy to promote employment, will depend on the political will of Community institutions and national governments. The Commission, for its part, will remain vigilant in the controls it exercises and will keep you closely informed of these.

President
Many thanks, Commissioner de Silguy.
The debate is closed.
The vote will take place at 11.00 a.m. tomorrow.
(The sitting was suspended at 8.22 p.m. and resumed at 9.00 p.m.)

Consultation of the ECB by national authorities
President
The next item is the report (A4-0195/98) by Mr Herman, on behalf of the Committee on Economic and Monetary Affairs and Industrial Policy, on the proposal for a Council Decision on the consultation of the European Central Bank by national authorities on draft legislative provisions (COM(97)0725 - C4-0147/98-98/0056(CNS)).
The rapporteur is not yet here. I shall give him the floor when he arrives. Mr Giansily, of the Union for Europe Group, is here however, and may have the floor for three minutes.

Giansily
Mr President, it is true that it would have been preferable, I feel, to have heard my address after Mr Herman had justified his own position but I will gladly tell you of the matters I wish to raise concerning his report.
Firstly, Mr President, Article 105, paragraph 4 of the Treaty, reflected in Article 4 of the statutes of the European System of Central Banks, stipulates that the European Central Bank is consulted by national authorities on any draft legislative provision within its field of competence, but within the bounds of, and according to the conditions established by the Council, in line with the procedure set out in Article 106, paragraph 6.
The purpose of the draft decision before us is to specify the conditions, obligations and limits imposed on those national authorities that intend to adopt regulations that fall within the field of competence of the European Central Bank, bearing in mind the overall objective which is to underwrite practical operation of the ESCB and the European Central Bank. Owing to the diversity among Member States in terms of their organization, the draft decision allows them a free hand with regard to those aspects we have just discussed, provided, it goes without saying, that the principle and rules fixed by that decision are observed. Let us remember that the European Central Bank is the central body and that all authorities must appeal to that body beforehand whenever they intend to adopt amendments to the prevailing rules in sectors within the field of competence of the ECB.
We give our consent, Mr President, to this entire development. However, we do not share the fears nor do we endorse the requirements put forward by the rapporteur which he has included in the amendments. On reading the proposals by Mr Herman, which I commend, it is clear that the impetus behind his proposals is the will to accelerate the process of a federal Europe by providing the Council, especially in respect of Amendment No 4, with retaliatory powers in order to impose on states special standards which the national bank would be reluctant to accept. This does not, however, seem to be in keeping with the spirit of the Treaty. All the debates in recent months prove that the will of the overwhelming majority of this House is to protect the European Central Bank from political pressure and to guarantee its independence. To seek to place it at the heart of a pressure group seems to me to contradict everything that has been said in recent months. This is why, in view of the formulation of the excessively restrictive text of the rapporteur, in our opinion, we would prefer the original enacting terms of the text of the Commission, which seems to us most appropriate, more flexible and more open. Similarly, we do not think it is necessarily a good thing to start out with an attitude of mistrust with regard to national authorities.

President
Thank you very much, Mr Giansily.
Since the rapporteur is now with us, I invite him to take the floor.

Herman
Mr President, please accept my apologies. This building is so huge, especially the furthest extensions, that it took me five minutes simply to get out of the place where I was attending a meeting in order to come here.
It is an advantage to be able to address you as a rapporteur after the speakers, because this gives me the opportunity to reply to them. But first of all, I would like to explain the reason why I proposed these amendments. There is absolutely no intention to give the Central Bank supplementary powers. There is no desire, as Mr Giansily observed, to enclose the Central Bank in a network of pressure of which it would be the victim, none at all. What I wanted to do is this.
The Commission, and the Council too, I might say, allows itself too frequently to be guided by legal experts. Those experts hit upon a formula that was perfectly valid when they sought to settle matters with the European Monetary Institute. Why is that so? Because at that time the Monetary Institute was still not the Central Bank. Monetary policies and the central banks were to remain active up to 1 January 1999. Consequently, if the Member States were to take steps that fell within the direct or indirect jurisdiction of the Central Bank, it was quite normal that they should consult the Central Bank. That was the arrangement. But since the legal experts and diplomats were not always sufficiently bold or particularly pushy, what did they achieve? Once the text had been agreed, they incorporated it for the next stage. They did not revise the text to allow for the fact that there would be a move to a different stage, that the Monetary Institute is not the Central Bank and that the Central Bank, once installed, would apply a single monetary policy.
From that moment forward, things change. Once a single currency has been established, why should states still have the authority to solve, for example, the problem of the legal situation regarding the bill of exchange or the cheque? What sense was there in citizens having a common currency, if they have to be subjected to 15 different legislative procedures when they use a bill of exchange or a cheque? The system proposed by the Commission does not alter these matters. One simply consults the bank. For my part, I would like to reaffirm the principle that all matters that come within the jurisdiction of the Central Bank should from now on, and this is the text of the Treaty itself, be subject to European legislation. But I accept that individual legislations are only remotely linked to currency and that, indirectly, they fall within national jurisdiction. And there, of course, the consultation terms proposed by the Commission seem to me to be perfectly acceptable and normal. This is why I have drafted amendments that restate this point. And I am pleased to note that my convictions were shared unanimously by the Subcommittee on Monetary Affairs, including the main Committee itself.
For this reason, Mr President, ladies and gentlemen, Mr Giansily's argument does not reflect my intentions nor the spirit of the text, since the text read out by Mr Giansily has twisted the words slightly to make them say what I did not wish to say.

President
Mr Herman, I know how punctual you normally are, so when I saw you were not here I knew something important must have happened. But I should inform you that at the start of his speech Mr Giansily said he wished he could have heard you first. You made a lot of references to Mr Giansily but, according to the Rules of Procedure, he had the right to listen to you first. Somebody who has definitely heard you first is Mr Ribeiro, whom I now invite to take the floor for two minutes, on behalf of the Confederal Group of the European United Left/Nordic Green Left.

Ribeiro
 Mr President, I have once again listened to Mr Herman with great pleasure, in spite of our differing views. Now that the euro has been adopted, it is necessary to speed up everything which has already been in the course of preparation for its practical introduction. This is what the Commission's proposal does, whether or not it is to the liking of those who have been opposed from the start to this process, which serves a strategic plan.
It would give expression to Article 105 (4) of the Treaty, which provides that the ECB must be consulted by the national authorities on any bill or draft legislative provision relating to matters within its competence. Where the Commission says 'weaken them' , Mr Herman says 'finish them off' . I think the proposal is still too decentralizing, which I admit would have been justified in 1991 to avoid frightening off (effaroucher) some of the Member States involved in the proposal. Now that it is no longer necessary to say the opposite of what you mean in order not to frighten anyone off, because public opinion is gradually becoming resigned to the coming of the euro and all it implies - which is also in the explanatory preamble, - and, as I say, it is being subjected to a disinformation campaign - for Mr Herman a step, even an accelerated step, is not enough: his report wants a leap forward. And that leap, quite apart from the amendments, adds a clause to the Commission's proposal which will mean we can no longer speak of national authorities. There will be little that is national, and nothing authoritative, about those bodies, which will be obliged to consult and comply with the ECB's opinions, even though they are endowed with the democratic legitimacy the ECB patently does not have.
Mr Herman has exceeded his remit. And I doubt whether my fellow Members who are going to vote for this proposed resolution have had sufficient information about what they are voting on, because this report has been adopted with such vertiginous speed.

de Silguy
Mr President, ladies and gentlemen, the debate in progress this evening may seem technical, yet it is important and necessary since it deals with legislation relating to the setting up of the European Central Bank. Your House has therefore been consulted on four proposals from the Commission and three from the European Central Bank. Naturally, I will only address those concerning the Commission.
Three of the four proposals do not pose a problem. Your rapporteur intends to approve them: this relates to the scale of contributions for a share in the subscribed capital of the Central Bank, matters relating to the taxation of ECB staff, privileges and immunity. I can therefore only express my delight in your support.
The problem relates to the fourth proposal for decision, in other words that relating to European Central Bank consultation by national authorities on the subject of draft legislative provisions; in this respect, your rapporteur proposes four amendments. I would, first of all, like to recall the general philosophy underlying this text before setting out the position of the Commission with regard to the four amendments. On a philosophical level, if I might call it that, the Commission proposal is inspired by a particular principle and past experience. The principle is strict compliance with the Treaty. The experience relates to that we gained, as a whole, in respect of the secondary legislation relating to the European Monetary Institute, an experience which, I believe, brought satisfaction.
I would also like to state that no-one could claim that a single currency might lead automatically to the genesis of a unique euro financial market. Of course, there is a very strong market logic and certain practices will find a certain similitude in a number of market sectors, and here I am thinking in particular of the monetary market. Yet, other alignments depend on conditions prevailing outside the market and even on Economic and Monetary Union. Hence, the inauguration of a single financial market, totally integrated, is predicated on a certain degree of harmonization. Some of these harmonization processes lie within the jurisdiction of the Community, whilst others are a purely national concern.
With regard to Community jurisdiction, I am thinking in particular of the legislation on savings, the taxation aspect of which was covered by a draft directive which the Commission adopted only recently and which has been issued to you. I am also thinking of the directive on the prospectus, or even the possible adaptation and possible harmonization of accounting rules. With regard to the jurisdiction of Member States, I am thinking in particular of the schedule for the states' sovereign issues, but at the same time I am thinking of legislative reform with regard to insolvency, bankruptcy or, indeed, the regulation of financial institutions. In all of these areas, substantial progress is a prerequisite for the introduction of a fully-integrated euro financial market as, if I understand it correctly, your rapporteur wished to see.
This is the thinking behind our proposals. I will now move on rapidly to a survey of the four amendments. Amendments Nos 1 and 2 actually go back to the matter I just raised on the sharing of jurisdiction between the European Central Bank and the Member States with regard to regulation and financial matters. As I suggested just now, the introduction of the euro can lead neither to automatic harmonization nor to a transfer of jurisdiction - indeed, Mr Giansily stressed this earlier. Incidentally, this transfer of jurisdiction from national level to Community level is not specified in the Treaty. Therefore these two amendments extend beyond the scope of Article 105, paragraph 4. Yes, Mr Herman, things will change on the 1 January 1999 and I have said this many times in your House. But the Treaty will not change, nor will Article 105, paragraph 4. This is the reason why the Commission cannot endorse these two amendments.
I would simply like to reassure you. In truth, the main precautions have been taken in this respect. Consequently, in the convergence report, first of all, the European Monetary Institute and the Commission have assessed and confirmed legislative compatibility of those Member States joining the euro movement, with respect to their central banks, with the provisions of the Treaty. Secondly, should a Member State adopt a legislative text, a law, affecting the jurisdiction of the European Central Bank, recourse to the Court of Justice would obviously be possible. Finally this draft decision by the Commission is based on similar provisions, currently applicable to the EMI, within the framework of Economic and Monetary Union. These provisions are satisfactory, they are operational and they have proved their effectiveness. Moreover, the Commission proposals tabled today have been approved by the European Monetary Institute.
Furthermore, the Commission is not even able to accept Amendment No 4 which, in practice, would mean that national authorities are obliged to bend to the will of the European Central Bank when it is consulted. In fact, Article 105, paragraph 4, simply envisages an obligation to consult the ECB without any binding commitment. Here too, however, irrespective of Article 105, paragraph 4, the Commission is obliged to ensure that the Member States comply with the Treaty, especially with regard to the powers and the independence of the European Central Bank. I can assure you that it will honour its obligations to the full in this respect. Finally, Mr Herman, I can offer you a measure of satisfaction: we can accept Amendment No 3.
In conclusion, I would like to thank your rapporteur for his analysis, and, personally speaking, I would like to commend him on his endeavours to promote the Community spirit. The Commission shares this approach but all the same, as custodian of the treaties, may we inform you that we cannot step outside the provisions of the Treaty and, in particular, the scope of Article 105, paragraph 4.

Herman
Thank you, Mr President, for allowing me the right to reply. I wholly agree with the Commissioner's words. Unfortunately, the Commissioner interprets the texts in a different way. When we speak of matters that fall within the field of competence of the Central Bank, we are no longer talking of matters that lie within national competence. And the Commissioner should know that, before the judges in the Court of Justice today, the texts are not interpreted in terms of the intent of their authors or their interpretation, but formally. We witnessed this recently and the Commission was its first victim, in the case of external relations problems. It was said that anything concerning services is not a matter for the Commission, since services are not dealt with in the Treaty. This is a purely formal interpretation. So, Commissioner, you should be aware that you have judges who interpret matters formally and when we are speaking of matters that fall within the field of competence of the Central Bank, they are no longer matters that lie within the bounds of national competence. So, all of the matters you raised and all the examples you quoted lie within the bounds of national competence.

de Silguy
I do not intend to prolong the debate because you have a lot of reports to examine and your House has been delayed somewhat. I would simply like to remind you that from a banking point of view, but also in a number of other fields, central banks retain responsibilities and powers. We cannot extend these powers abruptly without changing the Treaty. The Treaty does not allow us to espouse the approach advocated by Mr Herman. I regret this personally, but that is what the texts state.

President
Thank you, Commissioner.
The debate is closed.
The vote will take place tomorrow at 11.00 a.m.

Estimates of the European Parliament and the Ombudsman
President
The next item is the report (A4-0175/98) by Mr Viola, on behalf of the Committee on Budgets, on the estimates of revenue and expenditure of Parliament and the estimates of revenue and expenditure of the Ombudsman for the financial year 1999.

Viola
Mr President, ladies and gentlemen, first of all I would like to stress particularly some common aspects characteristic not only of the Parliament's budget for 1999 but, in many cases, of the budget of the other institutions: the adoption of the euro, computer changes for the year 2000, the forthcoming European elections and the related information policy, the consequences of the Amsterdam Treaty, the full implementation of the building programme exercising the option to purchase the LEO complex and the occupancy of IPE IV and, finally, the new staff management policy.
A few items constitute the basic choices comprising the 1999 budget: firstly, the rate of increase in heading 5, equal to 4 %, to which the Parliament and the Ombudsman must adhere. This increase, I can confirm here today, must not be considered an objective to be reached but rather an unsurpassable ceiling on expenditure, thus sticking to the idea of a rigorous budget comparable, in this respect, to that which the Member States have imposed on themselves. Secondly, we must not forget, as regards the allocation of earmarked funds for the Parliament and the Ombudsman, that the initial estimate of these funds is based on the "zero' -budget option, and new requests are and will still have to be supported by adequate motivations.
Compliance with these conditions means that the overall amount of the European Parliament budget comes to ECU 916.1 million, with an increase of barely 0.88 per cent compared to 1998 and an operating margin of 28.5 million ECU. In October this will allow us to give a response to some important problems which are still unresolved, such as the annual expenditure and its breakdown between the sums required for the purchase of IPE IV in Strasbourg, the costs connected to the new status of the Members - these proposals will have to be submitted by the working party created for this purpose by the President's Office to the Committee on Budgets by the first reading of the budget itself - the costs related to the choices that will be made regarding the status of assistants and contracting, still in progress, with freelance interpreters.
Moving on to an analysis of the specific features of 1999, the introduction of the euro and the preparatory work to solve the problems in the computer sector with the year 2000 will be reflected as from the present budget procedure. Therefore, and in line with what was highlighted by the European Council in Luxembourg last December, we shall take appropriate measures at the first reading.
Turning specifically to the Parliament, for which the allocation rate is 19.4 per cent of the volume of resources of category 5, and the particular features of the end of the fourth legislature, I would like to point out that the next elections should include financial costs of about ECU 17 million. This assumption is related to the percentage of renewal of the Members of the institution and the accompanying measures to be adopted before the elections, such as information, for example.
In any case, the European elections will, as in the past, be an opportunity to undertake a number of specific initiatives in the information sector, initiatives to increase voter participation, such as the Use your vote campaign, agreed with the Commission, also in a context of close cooperation with EUROSTAT.
However, as regards the consequences of the Amsterdam Treaty and the enlargement policy, we have taken into account, within responsibly reduced limits, the Parliament's need for more adequate human resources. This need is contained in the proposal to create 10 new temporary posts, linked to the enlargement process, on the basis of the job description which will be presented by the Secretary General to the competent bodies before the first reading of the draft budget.
On property, we would like to stress that, as from 1999, the related costs should decrease by a further ECU 17 million. Within this framework it should be noted that the savings derived from the reimbursement of the investments for buildings D1 and D2 make a margin of ECU 27 million available for the next financial year and that if this continues, this policy will certainly produce a real saving for the Union budget in future years. It is within the context of this policy that Mr Tomlinson's amendment falls, an amendment that includes the choices of the President's Office to use the financial resources available for the current fiscal year in order to exercise the option to purchase the buildings on rue Belliard for use by committees, by a letter of amendment to the 1998 budget, and on which, as rapporteur, I express a favourable view.
However, as regards the Ombudsman, the proposal of three new posts - and not six, as requested - is considered more in line with the budget rigour imposed for all the institutions, including the Ombudsman. With this, I do not want to rule out the possibility of further examination, which may lead to appropriate amendments in October, following also the indication of the President of this Parliament, who stated that the Council and Commission consider it the Parliament's job to lay down the general principles to be applied to the staff of the Ombudsman, regarding the number and status of the officers in his service.
It is in connection with these observations that I invite the Socialist group to withdraw its amendment or reformulate it adequately with an oral amendment, which I am prepared to agree.
Finally, I would like to emphasize the happy choice adopted in the committee to modify the nomenclature, and the positive outcome given to this choice by the administration of the European Parliament, which ensures that the Parliament's budget which we are now examining includes an attachment which presents the main budget amounts according to the intended use. I would also like to underline the harmonious relationship created with the President's Office and particularly in the last phase with the Vice-President entrusted with the dossier , my colleague and dear friend Lucas Pires, which is another small reason why we mourn his tragic and premature death.

Tomlinson
Mr President, it is often said that one of the first signs of madness is to start talking to yourself. The attendance at this debate this evening shows how close to the edge some of us are in danger of becoming. My feeling is only somewhat lightened by the very warm welcome I give to the Secretary-General who is here at the debate and Commissioner Liikanen.
I would like to begin by congratulating Mr Viola on an excellent report. It is excellent not only because it is good of itself but reflects what over recent years in the Committee on Budgets has become a seamless continuum of budgetary approach to our own Parliament. The stringency and the strict adherence to the 20 % ceiling of Category 5 appropriations is something which Mr Viola has welcomed and has enforced very strictly in the resolution he puts to us tonight.
My group would certainly endorse the three principles which reflect that continuum to which I referred: trying to get our estimates more and more based on the principles of zero-based budgeting, taking strong account when fixing the budget of the implementation of the appropriations that have been placed in previous budgets and an insistence that demands for new appropriations should be backed by appropriate supporting documentation.
Behind those principles there is also a very clear statement of priorities from Mr Viola. One of those priorities is in relation to our property policy in Parliament, Although we have such a thin attendance, we should perhaps note that part of that property policy renders the tense of Mr Viola's priorities in his explanatory memorandum slightly out of date. The necessary signatures were undertaken yesterday for us to proceed to the purchase of the Leopold building complex. That is extremely important as part of Parliament's approach to property policy. We have exercised the purchase option before the date of 31 May and in so doing we have managed to get the beneficial input to Parliament's budget of the BEF 7.25 billion that has been negotiated between Parliament and the Kingdom of Belgium.
That ECU 180m that the Belgians are giving by way of indemnifying the land and land development costs is a very important part of our building policy. But added to Mr Viola's report is Amendment No 2 from the Committee on Budgets, an amendment which I know Mr Viola supports. It is an amendment which refers to the supplementary and amending budget No 1 of 1998. In that amendment we are seeking a letter of amendment from the Commission to supplementary and amending budget No 1 of 1998 so that we can continue with the policy of property acquisition. It is the view of the Bureau and of the Committee on Budgets - and here they are absolutely as one - that in that supplementary and amending budget we should seek to purchase the Belliard I and II buildings so that they can be made available to the Committee of the Regions, to the Economic and Social Committee and to the common structure which, following the Amsterdam Treaty, will be dissolved but which will still have to produce common services to those two committees. So, I strongly commend Amendment No 2, which has already been carried by the Committee on Budgets, to the House.
The priorities are also stated as being the new staff management policy, a policy that the Secretary-General has outlined very clearly both to Parliament and to the staff. A third priority which I particularly welcome is that which we attach to the problems related to the introduction of the euro and the impact of the millennium bug. I hope we can look to the administration to produce a report to Parliament as to what this priority means in practical terms, not necessarily waiting until next year. These are serious problems for an information technology department which is already in many ways over-stretched and are probably two of the most important demands that will made of it.
Finally, I should like to refer to Amendment No 1 which stands in the name of my group. We have tabled this amendment in Mr Wynn's name in order to leave the matter of staffing for the Ombudsman open until the first reading when one will have a clearer view of the overall need concerning staff. We have done that, taking into account the views of the Committee on Petitions' rapporteur for the 1999 budget, Barbara Schmidbauer. I commend that amendment to the House as well.
On behalf of the Socialist members of the committee, I should like to say how much we identify with what Mr Viola has said about the sad death of Vice-President Lucas Pires. He was proving to be an extremely good interlocutor between the Bureau and the Committee on Budgets. We will certainly miss him in that role but, above all else, we will miss him as a good parliamentarian.

Fabra Vallés
Mr President, Mr Tomlinson said we may end up talking to ourselves. That reminds me of being on electoral campaign, preaching the good news, and sometimes being faced with empty halls. And of course, conscious of our role as missionaries, we do not give up, but carry on. All we do is say: "Please could everybody move into the front row' . Well, I think we could at least move into the front row without pushing Mr Liikanen out of his seat, which is rightfully his. That way we would be a bit cosier.
Mr President, I would like to start by congratulating Mr Viola on the budget he is presenting to us. It is a difficult budget, and that is the nice thing: to produce a difficult budget. In times of plenty, the budget is boring. And this is a difficult budget because of the large investments in property, furnishings and office automation equipment.
But with regard to Mr Viola's report, I would like to focus mainly on the Ombudsman's budget. The Ombudsman is an institution which was born after the era of budgetary plenty. Like everybody, it was born with nothing, and therefore without demands. And because there were no demands, it was born with a very highly regulated organization.
I believe the demands have increased - in fact, we can feel it - so the organization needs to be adjusted to the work rate demanded of it. And the work rate being demanded corresponds to the institution the citizens want. They want a flexible institution, with a good cost-efficiency ratio. So I think the time has also come for us to ask ourselves seriously whether something more really needs to be done with the organization of the Ombudsman. Not just to provide the posts which have been requested this time, but really to see if the Ombudsman needs a bigger organization.
It is true that not all the Member States have reacted in the same way. Some countries, such as Finland and Spain, are responding better, while the others are still some way behind. But we want an institution which can rise to the occasion, so it also has to be on a par with the other institutions, which means it has to have the necessary staff and means. And the staff have to be on fixed contracts, whereas temporary staff have to be for precisely that - for work which is only temporary.

Virrankoski
Mr President, I would first like to thank Mr Viola for a balanced and reliable report on the European budget for 1999. The total amount for the budget is 916 million euros, which is in accordance with the Bureau's proposal. This represents a rise of 5.2 million euros on this year's figure, or 0.6 %. This answers the call for austerity that has to be obeyed when expenditure rises, just as the Member States themselves impose the same discipline on themselves. The proportion of costs in relation to total EU administrative costs is also below 20 %, which falls in with Parliament's previous level of commitment. Balancing the budget is eased by the reduction of fixed costs by 17 million euros, as a conclusion is reached regarding Strasbourg's and Brussels' structural programmes. On the other hand, the end of the Parliamentary term and the switch to the euro will cost an extra 16.8 million euros next year. That is why the budgetary change, and in particular staffing costs, have demanded much restraint.
I would especially like to bring up one matter, namely the Ombudsman's budget. The institution of the European Ombudsman was established with the Maastricht Treaty, and it began its work in 1995. The experience of already two and a half years has shown that it is necessary to have one. A clear example of this is the soaring number of complaints that have been lodged, which last year showed an increase of 40 %. One of the main duties of the EU and the European Parliament is, I believe, the defence of the weakest. As the institution of the Ombudsman has been once and for all established by a unanimous decision by Member States, it should at least be given the modest resources it requires, or else the whole system will turn against its very own aims as matters pile up and decisions take so long to be made. The proposal by the Ombudsman for six interim posts is modest when we consider the quality of the work done by the institution and the vast area their work covers, as well as the incredibly short period of time they have had to develop. For this reason, I support Mr Wynn at this stage in his Amendment No 1. In all other respects I endorse the acceptance of the report.

Müller
Mr President, ladies and gentlemen, I find it difficult to talk about the European Parliament's budget today without referring to the striking confirmation in the most recent report from the Court of Auditors on the reimbursements and allowances which we receive as Members of the European Parliament. That is why it shows no disrespect towards my colleague, Mr Viola, and his work if I emphasize that my group will support the report and its priorities and naturally the draft amendments as well, particularly as far as the Ombudsman is concerned, and I now devote my speaking time to the special report, especially since the budget of the Parliament will certainly pick up detailed proposals which emerge from the Court of Auditors' report, and Mr Viola will submit appropriate proposals to us, I have no doubt!
It is extremely regrettable that the President has rejected convening a conference of Presidents this afternoon and has resorted to formalities. If the public rightly gets worked up about the unacceptable arrangements for reimbursement and insinuates that the Parliament has a self-service mentality, the President of this House should not hide behind provisions in the Rules of Procedure. The right course of action would have been to go on the offensive, because we did after all request the Court of Auditors' report ourselves and because at bottom we knew of all the procedural gaps which we have now had confirmed. Going on the offensive would also have meant in this case reducing the contradictory procedure to the minimum. Why not 24 hours, because it could hardly be simpler to give an answer to the observations of the Court of Auditors. The answer would be: "Agreed, that is how things are at present' , and "Agreed, that is how we want to change things in future' . But can we rely on this President and this Bureau as far as a willingness to change is concerned? I do have my doubts!
The working group set up by President Hänsch has come to nothing. The investigation into the pension fund system has come to nothing. The rationalization of travel costs calculations has more or less, well, actually come to nothing. It might perhaps be best to entrust the report to the Committee for Budgetary Control. I can assure you that we would work quickly and speedily!

President
Mrs Müller, you have criticized the stance taken by the President of Parliament. He is not here, but I represent him at the moment. I must remind you that the President told the House that there is no Court of Auditors' report. There are some provisional opinions, which are known to all of Parliament's political groups because they were sent to the chairman of each and every group. Furthermore, a reply to this provisional opinion is being prepared by the Bureau, which is the competent body to do so. That is a fairly accurate rendition of the President's words.
You may have the floor for one minute on a point of order.

Müller
Mr President, my point was not to refute what the President said this morning; my point was that I expected a political reaction. That is what I am criticising. Of course it is only a provisional report. Of course it was distributed to the Chairmen of the groups much too late, and of course as a Member I also received it yesterday evening. That's not my point! My point is that I am pressing for a political reaction from our President, given that the press out there which is full of suppositions and insinuations is demanding answers which have to be given by every Member of this House. My criticism was a political one, it was not aimed at the formalities and the Rules of Procedure! In that respect, the President is certainly right!

President
Thank you for publicly acknowledging that the President has acted correctly. I respect your opinions on the press, but I must inform you that the President is answerable to this House.

Faubre-Aubrespy
Mr President, greater transparency and clarity in this matter would be a boon for Parliament. I remember suggesting a long time ago that all of these matters should be dealt with by a committee.
I am surprised that yet again a budgetary debate is under way here, in Brussels, in flagrant violation of the Edinburgh compromise, confirmed both by the Court of Justice and the Amsterdam Treaty. Dear Mr Tomlinson, there were more of us present during the budgetary guidelines debate which was held this year in Strasbourg.
That comment aside, I would immediately like to raise again the matter of the chair to invoke the Viola report, which envisages "the appropriations necessary for a parliamentary calendar comprising 11 ordinary sessions and 6 additional sessions' . Eleven ordinary sessions instead of twelve, we all agree. This is an electoral year: we have six additional sessions, why is that so, when the calendar adopted by the Conference of Presidents stipulates only five.
The second main provision of the report sets aside appropriations to conduct a neutral campaign of institutional information amongst citizens of the Union. What is proposed is that we step up the appropriations allocated for information policy; ECU 2 750 000 have already been released for this purpose in the form of a transfer voted on 28 May last, instituting a special "European elections' action. So the European Parliament is preparing to vote on a 1999 budget which will only serve finally to augment its propaganda appropriations.
Is there a single example, in any democracy, where a special information action on the eve of the elections adds four billion already devoted directly or indirectly to propaganda by the Community budget? But that will not change anything. The federalist propaganda will continue relentlessly to seek to change the mind of those who, with full knowledge of the facts, are opposed to the process of European integration.

Perry
Mr President, I find myself totally supportive of the need to exercise very strict restraint over the budget, most importantly over the money we spend on the institutions. Therefore Mr Viola will have my full backing just as he will have my backing tomorrow in his very important report on the island regions of Europe. I would, however, say as an aside that I regret that in staffing issues we do not make more use of fixed term contracts. The businesses and individuals who create the wealth of Europe all have to act with restraint and they do not have jobs for life.
Having said that, our priority must always be how we can help the people of Europe. So I too am going to concentrate on the element of the budget dealing with the Ombudsman. The European Ombudsman is a critical role. It is important for us that we see that he gets the resources he needs. As a member of the Committee on Petitions, like you, Mr President, I have worked very closely with Mr Söderman. He is an extremely conscientious officer. Nobody could say that he is acting in a flamboyant or extravagant way. That is not his Finnish style. His office is the smallest ombudsman's office of any in Europe, save Malta. So, his initial request for six temporary staff was one that, at the very least, merited full consideration and a meaningful dialogue.
There are newspapers across Europe that are making a living exposing the errors and flaws of the European administration. Sadly, there are too many such errors and flaws. In the Ombudsman we have an officer who can act on behalf of the people of Europe but if he is going to do that job properly he needs the proper resources to do it. We should make sure he gets those resources. If we want to look at where that money can come from, I suggest we do a proper cost-benefit analysis on the Economic and Social Committee.

Piha
Mr President, first I would like to thank the draftsman of the report for some very painstaking work. I also wish to draw your attention to the European Ombudsman's budget. The opportunity to appeal to an ombudsman is one of the most important rights citizens of the Union have. The Ombudsman's task is to handle complaints about errors made by other institutions of the Community. The Ombudsman's office has been now running long enough to judge what sorts of staffing levels are necessary for a sufficiently up-to-scratch and speedy service for the citizens of the Union. The office of the European Ombudsman has been getting an ever-increasing number of enquiries. This shows that our citizens have regarded the work of the Ombudsman as essential in solving the problems that have cropped up in Union administration.
In his report Mr Viola suggests establishing three new posts to ease the work pressures on the Ombudsman's office. The problem, however, is not only the number of new posts, but, more particularly, their professional level. The citizens of Europe have a right to expect the European Ombudsman's office handling their complaints to have at their disposal a legal staff that have at least the same level of experience as those in the institutions of the Community which are being looked into. Otherwise we create a situation where the European bureaucrats are racing finely-tuned Formula 1 cars against the Ombudsman's Mazda 323 family saloon. In my opinion that is not fair for the citizen making the complaint.
I hope we can yet consider the proposal by the Ombudsman on the number of staff he requires, and especially on their professional level, before we finally approve the 1999 budget in the autumn.

Rübig
Mr President, I should also like to congratulate Mr Viola most sincerely on his report and come immediately to budget line 205 concerning the security and surveillance of buildings. In this case we have a rate of increase of 67 %, we are spending a total of ECU 17 million on our security, and we know that there is certainly a need to improve security in the building. There has been a great deal of theft in the House. That is why I launched a campaign on security and fighting crime. More than 150 Members have added their signature to this issue, and I believe that it should be a matter of concern to us that, if we are spending so much money on security, there should be some recognisable benefit in this area.
It was the case that special units were made available to guard the Parliament during the session which the Parliament held in Strasbourg. The Parliament is also guarded by the police and by the military, of course, in Brussels. I believe that it would be sensible to speed up official discussions in order to guarantee the security of the House and to ensure that costs are incurred in this area in a way which is really efficient. I believe that this is a matter of concern to the citizens of Brussels, and it is a matter of concern to all employees in the European Parliament and at the European level. I would argue that we should hold discussions in this area. The President promised to do so, and I believe that it should be a matter of concern for us all to look after the security of people in Brussels.

President
Thank you very much, Mr Rübig.
Ladies and gentlemen, Mr Rübig's was the last speech. The Commissioner, Mr Liikanen - whom I welcome - has told me that he does not wish to speak.
Before closing the debate, I shall give the floor to Mr Viola, as rapporteur. Perhaps he would like to explain to Mr Perry how big the Maltese Ombudsman's office is, because I know that Mr Viola was in Malta before coming here yesterday.

Viola
Mr President, precisely with regard to the Ombudsman, which all the Members have been discussing, there are a few things I would like to say. No one denies that the Ombudsman has been more and more active these past few years; his initial requests, however, contain elements which conflict with the regulations on the status of officials and with the rules on the rationalization of administrative expenditure laid down by the three institutions. For example, the Ombudsman cannot ask for posts which are not at the initial levels; he cannot request directly posts of high qualifications, or certain revaluations, like a revaluation of an A3 post to A2 after scarcely three years, meaning an official hired from the outside as A3 becomes A2 after three years. To me, frankly, these requests seem somewhat excessive.
So, if we approach this matter with a sense of balance and moderation, I am prepared to discuss it again, provided that - and I repeat - there is balance, moderation and compliance with the rules.

President
Thank you very much, Mr Viola.
The debate is closed.
The vote will take place tomorrow at 11.00 a.m.

Frontier workers
President
The next item is the report (A4-0168/98) by Mrs Van Lancker, on behalf of the Committee on Employment and Social Affairs, on the situation of frontier workers in the European Union.

Van Lancker
Mr President, Commissioner, ladies and gentlemen though few in number, I do not think I am wrong in saying that frontier workers can serve as a barometer for social integration in the European Union. Although there are only about 380 000 of them in Europe, they perform such an important signal function that they should be high on every agenda: on that of the Monti Group on tax coordination, in the Commission's Action Plan for the free movement of workers and in the plans for a European labour market. We can read from the situation of frontier workers how low the level of integration of the European labour market still is. How many obstacles there still are to the free movement of persons, how hard we still need to work in order to align social security systems and taxation arrangements of the Member States more closely with one another. Occasionally the barometer gives a real storm reading. For example, on 1 January 1994, when a change in the financing of the Dutch national insurance system left 13 000 frontier workers with a loss in pay averaging 3 000 Belgian Francs per month. Good enough reason for the Belgian trade unions to sound the alarm and use their right of petition, but this is only the tip of the iceberg. Indeed we have learned enough from our inquiries in committee meetings, from scientific studies, from judgments of the European Court of Justice, from the testimony of the EURES consultants, to convince us that every border area has its problems.
On top of problems regarding the transferability of social security provisions there is the chaos of tax arrangements which are regulated in some 220 different bilateral treaties and, to make matters worse, are not coordinated with the social security rules, so that in one instance it is the country of residence which is applicable and in another the country of employment. Because all countries are carrying out reforms of both their social security and their taxation systems, involving modernization, even privatization, the problems will only increase. In view of all this, frontier workers are rightly calling for a European policy.
The demands of the frontier workers are very reasonable. We have incorporated a number of them into this report. I hope that Parliament will be able to support the report tomorrow. Anyway I take this opportunity to extend a warm word of thanks to those colleagues who are here for their very intensive cooperation, and of course to the Commission, who assisted us with information of all kinds.
First demand: as prevention is better than cure, we ask the Commission to draw up a proposal for a Europe test, by which all new legislation on taxation, social protection and employment matters would be subjected to preliminary and mandatory vetting for its effects on frontier workers. According to Parliament's Legal Service, Commissioner, Article 49 of the Treaty offers a sound legal basis for doing that. I would therefore very much like to have a concrete reaction from you on this point.
This report fleshes out the Europe test in more detail. A national platform of social partners and experts from the social affairs and tax administrations could carry out the assessment in each Member State. At European level, however, we think that the Advisory Committee on Social Security for Migrant Workers and the Advisory Committee on the Free Movement of Workers would be best placed to consider the problem of frontier workers and could propose solutions for the problems which remain despite the Europe test.
Second proposal: we ask the Member States to set up compensation funds for the income loss suffered by frontier workers as a result of changes in legislation. Here I have to say, ladies and gentlemen, there is some misunderstanding about this proposal. It is definitely not about the creation of a European Fund. The initiative is left entirely to the Member States. This is an appeal from Parliament. Of course, only in those cases in which a Europe test finds that changes in tax and social legislation do lead to income losses and the Member State in question nevertheless decides to go ahead with the changes, and sometimes Member States have good grounds for so doing, only then would a compensation fund come into operation. I therefore hope that colleagues can drop their last remaining objections to this proposal.
It is also Parliament's intention with this report to achieve a further step towards European coordination in social security and fiscal legislation in the Member States. With regard to social security, Commissioner, I will be brief. The Commission has already presented a number of proposals. We are also pressing for attention to be given to the new supplementary social security systems, which are not yet covered in the Regulation, but the Commission deserves all credit for the initiatives it has already taken, and we only hope that the Council can now finally take a decision.
In the field of taxation, on the other hand, there is a proliferation of schemes. We therefore ask the Commission to screen the bilateral taxation agreements, to work out a European Model Convention to replace the OECD Convention and to prepare a mandatory European directive on non-discrimination against non-residents on the basis of the long-promised Memorandum. I hope that the Commissioner can also give his opinion on that, although of course it falls within the remit of his colleague, Mr Monti.
The lack of coordination between taxation and social security is really the cause of most of the problems. Reason enough to plead for a homogeneous application of the country of residence or country of employment principle for both systems. I myself felt that the country of employment principle best responded to the existing social security arrangements, on the one hand, and to the general principle of double taxation agreements on the other hand. This, combined with systematic application of the non-discrimination principle with regard to tax deduction and a compensation scheme between Member States, could have secured the removal of the last remaining objections. Apparently some minds are not ready for that, Commissioner, so we ask the Commission to make a detailed examination of the advantages and disadvantages of the possible choices of country of employment or residence principle and to present a proposal to Parliament on the basis of that.
Lastly, the report also urges that service and information facilities for frontier workers be strengthened within the context of the EURES networks, but we think also that the national administrations should do much more to honour their responsibilities towards frontier workers. The situation in which border areas are literally peripheral regions and frontier workers' problems are marginal problems must not be allowed to continue.
Finally, we complain so often that Europe is remote from ordinary people. Here we have brought a Euro-barometer in from the real world, the world of people who have direct experience of European problems on a daily basis. I hope that the Commission will take the problems of these people to heart and can report to us annually on the situation, and I hope that we can keep these problems permanently on our parliamentary agenda.

Glase
Mr President, Commissioner, ladies and gentlemen, this report on the situation of frontier workers is one of a series of reports which deal with the problems of people who use or want to use one of the most important basic freedoms in the European Union. The rapporteur has devoted a good deal of work to drawing up the report in order to demonstrate the diverse problems of workers in frontier regions. Although in theory and in practice the internal European frontiers are intended to present no obstacles to the free movement of people, there are plenty of difficulties in terms both of tax law and of social security law, so that clarification is urgently necessary in the interests of the workers.
The first thing to be done is to arrive at an unambiguous definition of the term frontier worker. It is all too often the case that different interpretations are advanced. It would be splendid if the Commission could work towards producing some proposals in this area. In our group, we have looked at these issues in depth, and we are able to agree with many of the rapporteur's ideas. We would like our draft amendments to contribute to ensuring that the report on the problems of frontier workers sticks with this issue, and that it is not muddled up with other sets of problems. We shall reject those points dealing with compensation funds. In this matter, our view is that no genuine solution can be achieved on the basis of this sort of more or less voluntary individualisation between the Member States. On the contrary, it would simply be a postponement which is the last thing the workers concerned want.
If there were any result, it would involve a lot of agreements between countries which would simply compound the confusion and no country would consider itself obliged to make any effort to work towards a common and fundamental solution of the problem. I would like to encourage the Commission to take concrete steps in this regard and to press for the proposals which it has already put forward. The Council has put a tight leash on itself by virtue of the unanimity procedure. These are brakeblocks which should at long last be abolished now in the interests of the European cause. We shall also reject the demand for checks and directions to be introduced into free collective bargaining. Free collective bargaining is something that we have always strongly defended. Our Amendment No 10, which relates to point 13, was withdrawn by me, because it was drawn up on the basis of an error in translation in the German version. That also relates to the term "Europaprüfung' in the German version, but we have already come to an agreement with the rapporteur about ensuring that care is taken to make the appropriate changes in the different versions.

Boogerd-Quaak
Mr President, Commissioner, ladies and gentlemen, I would like to place this report in a somewhat wider context. This afternoon we talked about the broad economic policy guidelines and then we noted, and that was right across the House, that there is still a lack of coordination in the European Union in countless policy sectors which are absolutely vital. That is why the Van Lancker report is so urgently needed, because it exposes matters which admittedly affect frontier workers in the first instance, but which also have everything to do with bringing flexibility to the labour market, not only within countries but also in possible employment situations spanning different countries.
This is a matter that various Commissioners are working on. Mrs Van Lancker has already pointed this out. The Monti Group on tax coordination and the Veil Group have done excellent work. At the present time we are looking at what can be done in the field of pensions. Nevertheless, frontier workers are often in extraordinarily difficult positions and, in taking the initiative to work across the border, lose quite fundamental rights, including basic entitlements such as the right to a pension.
I have tabled an amendment following on from the Decker v. Kohl cases, and I hope that the rapporteur will include this amendment in the considerations, because here too a quite fundamental matter is at issue, namely the right to medical care even after the employment relationship ends.
In short, I am very happy indeed with Mrs Van Lancker's report. She has done an excellent job and I hope that this report will be a basis for resolving a number of anomalies that still exist.

Wolf
Mr President, I believe that Mrs van Lancker has not only worked hard but also well, which is most important. I would like to refer again to her thesis of the signal function. I believe that frontier workers are in some ways like bio- indicators which record the level of free movement and equal rights in this Union. It has to be said that this level seems to be under a high degree of pressure. If we take that as our measure, then there is an urgent need for action. This is not the first time that we have agreed on this matter; we withdrew the report by Mrs Oomen-Ruijten, for example, until we could reach a more positive understanding with the Commission. In this case, it is mainly a matter of social security and taxation, and their interaction. These are not matters for local authority politics. We cannot place these questions on the shoulders of frontier local authorities; the Member States have to face up to their responsibilities at long last!
Moreover, in everyday life it is also a matter of access to healthcare, security for family members, early retirement, supplementary pension systems, access to unemployment insurance and taxation. All of that is caught up with the problem of unanimity in the Council of Ministers, even though in other areas everything that is needed to implement the internal market is not subject to unanimity but can be decided by majority vote. It seems to me that there is a systematic problem here. I think that the proposal of a compensation fund for disadvantages suffered or for an early warning system through the consultation procedure in advance of relevant legislation is a good proposal. I am not convinced by the tendency of the European People's Party Group to delete essential elements by means of draft amendments, on the pretext that a global solution which might some day be achieved will be prevented by adopting interim solutions. We should support the proposal as it is. I think that Mrs van Lancker has elaborated the essential points. If we adopt it as it is, we shall be taking a step forward.

Striby
Mr President, ladies and gentlemen, the matter raised in Mrs Van Lancker's report merits our full attention. When, in this very House, we debate problems that focus on the lack of harmonization, for example, in the sizing of processed peas, the capacity of moped engines or the speed of forestry tractors, we tend to overlook those citizens who, whether nationals or frontier residents in a Member State, are unable to work in the adjoining Member State without coming up against insurmountable administrative, social or tax problems.
What are we to think in an age when trade, electronic interaction, professional and geographical mobility on a world scale are becoming commonplace, how do we view a European Union that professes lofty principles, in this case the abolition of all domestic borders, yet fails to broach problems of stewardship. It is a sensitive problem and even the euro, the alleged panacea for all our problems, offers no relief. Different and frequently complex social regimes exist within our individual Member States. We therefore need a strong political will and a genuine desire to promote the common good in order to confront the problems posed in this area.
In the preambles to her report, Mrs Van Lancker quite rightly referred to the many petitions that our committee responsible handles in this respect. Thus, for instance, the many cases of dual taxation in the state of residence and in the state of employment, or non-payment of various allowances because the citizens reside in another Member State. It is indecent to appeal throughout the report for more resources to assist the mobility of citizens of the Member States or to claim the creation of a citizens' Europe when those very citizens, on a daily or weekly basis, cross domestic borders and face staggering problems.
We might add to this those situations where Community nationals face difficulties due to the lack of coordination on the position of Member States in their bilateral agreements with other states. Once again, there is no shortage of examples, especially in Switzerland. In France, for example, the committee for the defence of frontier workers in the Upper Rhine throws up many examples, such as that of the Italian national who worked and paid his dues for 25 years in France, followed by two years in Switzerland and who, falling victim to a disability, lost his claim for compensation because of the last two years since he is Italian and therefore not covered by the Franco-Swiss bilateral agreement.
Ladies and gentlemen, let us not forget that in the first instance, we are the elected members responsible for promoting the common good. Europe will not be built on large coalitions, declarations of intent and self-congratulation, but by the day-to-day approval of its members, I mean individuals and whole peoples. This is because we will know, when we acquire the legal and technical jurisdiction, how to listen to them and solve their problems and they, in turn, will be able to listen to us and understand.

Oomen-Ruijten
Mr President, I want to say a sincere thank you to the rapporteur for a good report.
The report has its origin in the problems of Belgian frontier workers who, through the fiscal treatment of social security in the Netherlands, suffered a loss of purchasing power amounting to a few hundred guilders a month. The rapporteur has made use of that and has referred to numerous petitions submitted to the Committee on Petitions. The Committee on Petitions is in fact the last resort for tens of thousands of people who constantly face border problems.
There are in Europe a good six hundred thousand workers who commute across frontiers and, if we add the number of people who receive benefits from past employment in another Member State, we have a substantial group of people who desire more European coordination in the field of social security, taxation and benefits or allowances for sickness. Compared with employees or benefit recipients who live and work in the same Member State, they often have an inferior status.
Europe is trying to coordinate. However, only social security falls within the Regulation, which moreover shows many other gaps. A major problem results from taxation not being in step with social security or sickness allowances. Now that social legislation is being constantly amended in the Member States and more and more tax-related elements are being introduced, it is high time for fiscal coordination to be tackled at European level. A study of the University of Limburg, carried out in response to the Belgian problem, indicates that it would be possible to put an end to the many instances of unfairness by allowing people to opt for both their social security contribution and their tax assessment to be located in their country of residence or, if they prefer, in their country of employment. The clear choice that the rapporteur had for that concurrence in the first instance has been invalidated by her subsequent amendment of the original quite categorical formulation. I think that is a pity. Now the Commission is being given the task of working something out in the field of taxation too. I would have preferred to see it formulated in much sharper terms; I support a rapid and constant endeavour on the part of the Commission to reach a solution. If the Commissioner can now tell us what he intends to do, I shall at least be able to give a little hope to my commuting constituency to whom, if I may say so, the European ideal is of such vital significance.
Of particular importance, and I hope to get a positive answer on that point too, is an element in this report which I already introduced here about six years ago, but then as "the commuting effect test' , but what's in a name? The aim of what is referred to in this report as the Europe test is to introduce an obligation to chart the effects of every amendment of social or fiscal legislation at Member State level on commuters and ex-commuters. The availability of information on the problems will also prompt national parliamentarians to turn their attention to seeking solutions.
What makes less sense to me is to have a compensation fund by which disadvantages to cross-frontier commuters would be mitigated at Member State level. It was particularly gratifying to me - and I say that to my colleague, Mr Chanterie, as well - to learn that the Belgian government set up an arrangement for Belgian frontier workers when my country, the Netherlands, proved unprepared to agree something on a bilateral basis. However, I think it would be a tedious business to make provision for such stopgap remedies at European level.
Thanks to the rapporteur for taking up the idea of setting up an experiment - you might remember the Maas/Rhine EuroRegion, where it makes no difference as regards sickness allowances, at least for cross-frontier commuters and their families and/or ex-commuters, where the entitlements are purchased. I remember asking for Limburg to be included, but without anything coming of it. I wonder whether the Commission is prepared to support a new initiative on these lines or to develop it from scratch, since cases of this kind are now making much more headway through the Court of Justice.

President
Thank you very much, Mrs Oomen-Ruijten. I must say, the clock was on your side because it only started counting some way into your speech.
Mr Chanterie now has the floor for three minutes. Let us hope the clock is working properly now.

Chanterie
Mr President, Commissioner, ladies and gentlemen, I think we all agree that we have talked about the advantages of the internal market in a great many places over the years. But those citizens who have most experience of the disadvantages of the existence and working of the internal market are the frontier workers. They live in one country and work in another, a neighbouring country. They pay taxes in one country and social security contributions in the other.
The tax and social security rules of the countries concerned may well be in conformity with the letter and spirit of Community law, but in the way they interact they cause substantial loss of income to frontier workers. And that is the situation. That is the situation of many frontier workers in my country who go to work in the Netherlands, or in France, or in Germany. These frontier workers are victimized by that situation, for various Member States, primarily the Netherlands - and we have to put the Netherlands in the dock over this - but various Member States have developed the habit of penalizing socially people from across the border who come to work in their countries.
It is a familiar pattern. It concerns matters that are regulated by bilateral agreements. Agreements between Member States in which the European Union as such cannot easily intervene. That is precisely the problem with which our population is confronted. They expect the European Union to act; on the other hand, the Union has up to now had few instruments which would enable it to intervene. Hence this initiative report, Commissioner; I congratulate the rapporteur on her work and am pleased that she adopted many of my amendments in committee, so in view of that I will certainly support the report.
Let me dwell for a moment on the aspect of a test and the aspect of compensation. Commissioner, I think that a very important element in this report is the Europe test, or a vetting process to determine what disadvantages frontier workers might experience as a result of new legislation passed or new decisions taken in Member States. We have been arguing about a legal basis, but I think there is a satisfactory solution for that.
Secondly, the compensation fund. I agree with the rapporteur that we cannot just sit back and wait until a solution pops up out of the air, while people are suffering substantial income loss through measures of this kind. Thus I strongly support the demand for a compensation fund and a compensation scheme in order to offer some measure of restitution to these people who are adversely affected.

Schiedermeier
Mr President, the rapporteur is right to state that the 380, 000 commuters across frontiers make up a minority by comparison with an estimated 150 million workers in the European labour market. At the same time, it goes without saying that the free movement of workers is an important right of the internal market. I am very happy to concede the signal function in relation to the EU's objectives. That is why I fully support giving equal rights to frontier commuters and mobile workers in terms of the European Commission's action plan which contains five main emphases, namely improving or adjusting the most important legal documents on the free movement of workers, increasing the transparency of the labour market, taking-on of responsibility by the Member States and developing co-operation, better information about the right of free movement and strengthening the external effect as well as assisting innovative projects in the framework of the European Social Fund.
Under no circumstances can there be any tampering with free collective bargaining - a great good - as is demanded at point 7 by my colleague Mrs van Lancker. The principle of subsidiarity must also be respected. Preference should definitely be given to bilateral solutions. Under no circumstances can I agree to a central compensation fund at an EU level. And I continue to reject any extension of reuniting families, or any expansion of the export of support for the unemployed and for families and payments of money or of the right of residence for family members from third countries until it is has been established who are members of the close family circle. Under no circumstances can these include children over 21 who are not entitled to maintenance, or relatives in an ascending line who are not entitled to maintenance. In conclusion, I say to my colleague Chanterie that I would stress one point: the frontier workers do this on an entirely voluntary basis.

Lulling
Mr President, of the 380, 000 strong workforce employed as frontier workers in the border regions between Member States, nearly 20 % from France, Germany and Belgium work in the Grand Duchy of Luxembourg. We have therefore made a significant contribution to the reduction of unemployment in those areas. I am proud to be able to point out that these frontier workers in our country have a job, a wage, as well as employment and social security conditions which, especially with regard to pension schemes, are much more favourable than the areas in which they live. In the light of this, it would be totally eccentric to envisage the institution of a compensation fund, as proposed in the report. Indeed, it is quite wrong to claim that in general, in the Community, frontier workers suffer from loss of income and discrimination. Sometimes our own nationals feel they are victims of discrimination. Mrs Van Lancker, unfortunately, sees only the holes in the cheese and I should say that we export family allowances and dependency insurance benefits for the well-being of our workers which do not even exist either in Belgium or France.
I felt it my duty to raise these issues, Mr President, and especially to endorse the principle that it is in our interest to combine the payment of social security contributions and taxation on wages in the country of employment. In our opinion, this is sacrosanct in the interest of the frontier workers.

Flynn
Mr President, firstly I should like to thank Mrs Van Lancker for her excellent report on the situation of frontier workers and, in particular, the social and fiscal problems that these workers face. The Commission fully supports her concerns. Indeed, the Commission's action plan for free movement of workers adopted on 12 November 1997 highlighted the important role of cross-border mobility in the Union. In particular, it underlined the need for specific clear provisions to overcome the problems caused for frontier workers by disparities between national, legal systems in fields such as social security, taxation, health care and social advantages. Besides this statutory action, cross-border cooperation needs to be fostered in order to cover specific issues of interest to frontier workers such as social security and taxation.
Your draft resolution calls for a range of actions from the different partners involved. I welcome your proposal to put forward the resolution to the Council, the European social partners, the governments and the parliaments of the Member States, as well as to the Commission. I fully agree that only a combined action at each of these levels will bring about meaningful resolution of the problems analysed in the explanatory statement.
Allow me now to set out briefly the Commission's approach to the points raised in the resolution. With regard to fiscal matters, the Commission has long been aware of the specific tax problems of frontier workers and has sought to contribute to their solution by way of legislative proposals and other initiatives. As early as 1979 the Commission presented a draft directive to harmonize certain aspects of a tax treatment on non-residents. Unfortunately the proposal was not adopted since the required unanimity in the Council could not be reached. Therefore, in 1993 the Commission adopted a recommendation on the tax treatment of residents' income. The recommendation and the jurisprudence of the European Court of Justice following the approach of the recommendation, in particular the Schumacher judgment, significantly benefited the situation of non-resident workers. Most Member States concerned have now, more or less, adapted their legislation on the taxation of non-residents who earned their main income in a Member State other than that of their residence, in line with the recommendation.
The Commission has also kept under review the legislation in Member States and initiated infringement proceedings against several Member States for failure to respect the non-discrimination rule. This report underlines the need for a Community approach to the problem of rules for tax jurisdiction in parallel to that existing in the field of social security. The Commission can in principle agree with the need for Community action. It has to take into account the need for unanimity for any adoption of binding Community legislation in the tax field. In the absence of harmonization of income taxes, the attribution of taxing rights among two Member States is so far governed by their bilateral tax conventions.
Recently the Court ruled that under the existing provisions of Community law Member States are free to arrange bilaterally the tax jurisdiction for income tax of frontier workers. Any multilateral approach in the form of a European convention on the avoidance of double taxation of income and capital would also require unanimity. However, the Commission will pay particular attention to the need for a coherent solution of the tax and social security problems faced by the frontier workers.
Concerning social policy, I welcome Parliament's support for the Commission's different proposals to amend Regulation 1408/71 on social security for migrant workers. In this respect, you are probably aware that the Court of Justice has recently made two important judgments. These judgments means that a person who was insured for medical care in a Member State is entitled to be reimbursed by that state for all medical care he or she receives in another Member State in accordance with the tariffs of the state of insurance. Since these judgments are directly applicable, the experiments that Mrs Van Lancker suggests in her resolution do not now seem to be necessary.
I would like to thank Mrs Van Lancker and her colleagues for the encouraging support given to the EURES network. The EURES cross-border partnerships have been supported by the European Parliament from the very start and we welcome the proposal that EURES and its cross-border partnerships should be stepped up. However, I should underline that while the number of cross-border partnerships has increased from 11 to 18 over the past two years, our budget has not increased. In fact, it has slightly decreased over the same period. These cross-border partnerships provide services to frontier workers such as relevant information about their rights and obligations. In that sense they support certain requests of this resolution.
The EURES adviser can help national and European institutions to be informed as quickly as possible about obstacles to mobility. In the future we intend to gather such information in a more structured manner. The EURES partners and their advisers will thus be able to contribute to the setting up of an early warning system. However, it should be made clear that they will not be able to provide a complete coverage in all border areas of the Union or in all aspects mentioned in the resolution. However, the Commission will shortly present a comprehensive report on the work of the EURES network for the years 1996 and 1997 to Parliament. This could be a good opportunity to carry out an in-depth dialogue over the future developments of the EURES network.
As regards the proposal to establish call centres for migrant and frontier workers, I would like to draw Parliament's attention to the Commission's intention to launch a permanent dialogue with citizens. This will be officially announced at the European Summit in Cardiff. Call centres will be established in all the Member States on the model of the Citizens First initiative, to advise citizens on their rights as well as on any community-related problems.
Finally, I would like to comment on the idea of the proposal for a directive on the introduction of a European test, whereby Member States would be required to test their legislation on the effects they have on frontier workers. I would like to make it clear that it is already the Commission's task to ensure that all provisions of national legislation are compatible with the Treaty and the secondary legislation so far as Community law is concerned. The Commission will certainly continue to use the powers laid down in Article 169 of the Treaty and to launch infringement proceedings against Member States when they violate EC law.
However, I understand that the suggested proposal for a directive aims to provide for a more general socio-economic impact assessment of the consequences of national legislation which is in itself compatible with EC law but which might cause detrimental effects to frontier workers. While I am not sure that it would be appropriate to propose a directive in these circumstances, it seems to me appropriate to stimulate, as it is suggested in the report, cross-border concertation of the partners involved in the different regions and at Community level. So I can confirm that it is the Commission's intention to stimulate this concertation in order to be able to identify infringements of EC law and the socio-economic consequences of national legislation on frontier workers.
Finally, I would like to thank the rapporteur for her stimulating report and to stress the Commission's determination to maintain its efforts to overcome the problems faced by frontier workers.

Van Lancker
Mr President, I would like to thank the Commissioner for his extensive answer, which I find to be largely satisfactory. But one question regarding the Europe test. I know that he was not so favourable to the idea of a Europe test before, but I also know that the Commission's Legal Service has been investigating the question of the legal basis in the Treaty. Can the Commissioner confirm or deny that there is a legal basis for such a test, by which it would be possible to vet the social legislation of Member States not only for its conformity with European law but also for its effects on frontier workers, which is another kind of test? Our Legal Service had indicated Article 49 as a suitable legal basis. I would appreciate it if the Commissioner could comment on the findings of the Commission's Legal Service.

Flynn
Mr President, I should like to say to Mrs Van Lancker that it is my opinion that there is a legal base. The question is of some political choices to be made here and before any of these matters concerning that and other matters concerning taxation are pursued, the taxation policy group should have a look at these matters first. The only difficulty is that it seems to be overloaded with matters to be dealt with this year. I know they are obliged to deal with an investigation on pensions and on energy taxation and on electronic commerce. That is a pretty over-loaded agenda at the moment. But the answer in short is Yes, it can be established that there is a legal base where this could be undertaken.

President
Thank you for your speech, Mr Flynn.
The debate is closed.
The vote will take place tomorrow at 11.00 a.m.

Registration documents for motor vehicles
President
The next item is the report (A4-0190/98) by Mr Bazin, on behalf of the Committee on Transport and Tourism, on the proposal for a Council Directive on registration documents for motor vehicles and their trailers (COM(97)0248 - C4-0423/97-97/0150(SYN)).

Bazin
Mr President, Commissioner, ladies and gentlemen, I have three comments to make: the first relates to the current situation, the second relates to the aims of this draft directive and the third concerns the difficulties arising during this undertaking.
We can say that the current situation is marked by the very wide diversity of this type of document - what we call the "grey card' in my country - for vehicle registration certificates. They vary widely, both in terms of their content and form. Because of this extremely wide diversity and a virtual lack of any kind of codification, legibility of the document from an international standpoint and its use by those responsible for checking vehicles in transit is extremely problematic.
The aims of the draft directive are simple: we simply wish to harmonize the document layout. We propose that there should be two parts, and that what should be shown on the document must be specified, as opposed to that which might appear on the document and, finally, to adopt a simple alphabetical codification procedure so that the document is easily legible in any country. The difficulties encountered to date have been numerous and relate to the widely varying legal nature of the document from one country to another.
In certain countries, it is merely a registration certificate, in others it serves almost as a proof of ownership. Finally, in some countries, this document does not even exist because things are arranged differently.
Next, there is the question of the function the document fulfils. Some administrations require only an administrative document. For others, it serves as a reference that the police can check. Finally, based on the details included in, or omitted from this document, it might also serve as a means of checking the operation of the vehicle. Clearly, extremely diverse administrative philosophies are concealed, to some degree, behind this multi-faceted document.
In conclusion, I might say, it is a good a thing that at this early stage the draft is a modest effort. This is the reason behind it and this is why, personally, I have only put forward three amendments, Amendments Nos 1, 3 and 4. These underline the fact that it was an initial step, but that it should not remain an initial step. They sought to defer the enforcement date slightly and next they sought reciprocity in terms of information between national administrations and the Commission. Our colleagues in the Committee on Transport and Tourism wished to adopt the amendments of Mr Seal, who proposed a number of items to combat fraud. I go along with that view. However, I cannot agree to Amendment No 7, tabled by the Greens, because this will overload the document further with details relating to operation of the vehicle, which would undoubtedly make it extremely difficult to adopt even this initial step in our efforts to harmonize registration certificates.

Sarlis
Mr President, I consider that the regulation proposed by the European Commission is most fortuitous for two reasons:
First, because road cabotage has been deregulated. This means that we need an efficient system for monitoring and controlling freight vehicles moving within the internal market.
Secondly because, as the committee of inquiry into fraud and smuggling of goods in transit found, most goods, especially cigarettes and alcohol, are smuggled by road. There are, at a guess, hundreds of instances in which lorries have disappeared together with their freight by changing their number plates and respraying and many of these have been documented in the Commission report in the committee of inquiry into fraud and smuggling of goods in transit.
The proposal itself, and I would like to congratulate the Commission and its rapporteur, Mr Bazin, on their proposal, is based on two premises:
First, if a lorry or bus is to be registered in a Member State, the old registration documents must be submitted to the new state in which they are to be registered. That is fundamental.
Secondly, the state which registers the vehicle must send the old registration documents to the state which issued them, in order to inform them that the registration number of the vehicle has changed.
Another extremely important point is that provision has now been made for vehicle checks on all main roads within the European Union. In some countries, such as the United Kingdom, Denmark and Sweden, where freight vehicles do not need to carry their registration documents while travelling within the country, they are now required to do so when travelling outside the United Kingdom, Sweden or Denmark.
May I also say that the Group of the European People's Party endorses the report and will endorse the rapporteur's amendments.

Jarzembowski
Mr President, Commissioner, ladies and gentlemen, this is really a debate among transport policy conspirators. This is a report which is slightly technical but not really as technical as all that. Allow me to begin by offering sincere thanks to the Chairman of the Committee for Transport and Tourism. It is sometimes his duty, which he takes seriously, to assume the role of rapporteur and to push the matter forward, if no group wants to take on a report because of the subject, and I am particularly grateful to him for handling transport policy in our Committee with such commitment.
As to the matter itself: we support the draft directive from the Commission on the harmonization of the registration documentation for motor vehicles and trailers. I believe that aligning registration documents will facilitate transport checks in the Union, because in future and irrespective of the issuing country the documents will in each case contain a series of clear and uniform statements; for example, inter alia they will indicate in which Member State the vehicle is registered and which person is the authorised owner of the registration documents. That will unfortunately still not tell you who is the owner of the vehicle, but we shall at least know who is the authorised owner of the registration documents. By this means, the draft directive will at the same time assist the fight against car crime. Moreover, the alignment of registration documents will facilitate reregistration of a motor vehicle from one member country to another.
However, Commissioner, my group believes that this can be only the first step towards harmonization, because it makes no sense within the European Community for some states to have one-piece registration documents and others two-piece documents, with differing legal consequences in the Member States concerned. That really makes no sense at all in an internal market. I think that we need a certain degree of harmonization in an internal market. It does not have to be taken to the final degree, but there has to be a sensible harmonization of basic data. That is why I would be happy if you would acknowledge that harmonization will have to go beyond this first step, especially since I believe that the theft and smuggling of vehicles within the Community and also from the Community into adjacent third countries must be more effectively prevented, and it would be helpful in this respect to have sensible registration documents. That is why, Commissioner, we support your proposal. We hope that you will support the draft amendments from the Chairman of the Committee on Transport and Tourism - apart from the draft amendment from the Greens, of course, we do not support that one either - and we also hope that it is the first step on the road to a careful but objectively justified harmonization.

Kinnock Neil
Mr President, can I begin by thanking Mr Bazin on his excellent and concise report discharged as a duty but also with some enthusiasm. As this report notes, and as we have just heard from Mr Bazin, there are considerable differences between procedure and purpose relating to the registration of motor vehicles in the Member States. There are also varying degrees of endorsement of the 1968 Vienna Convention on Road Traffic, so increasing mobility in the Community and in the single market now makes the harmonization of rules on information contained in registration certificates sensible as Mr Sarlis pointed out. I am naturally pleased to note that Mr Bazin and his colleagues support the objectives of the proposal. I have, of course, considered the various amendments carefully and whilst they have my broad sympathy, some purely practical considerations mean that I sadly cannot accept all of them.
Amendment No 1 calls for an additional statement in the preamble to the effect that this proposal constitutes a first step towards more complete harmonization. While I agree with the sentiment of the amendment, for the reasons set out very recently by Mr Jarzembowski and whilst I also believe that there will be moves towards greater uniformity in the future, the addition of such a new preamble would serve no strict legislative function and consequently the Commission cannot accept it.
Amendment No 3 seeks to change the dates of implementation to take into account the actual time frame of the proposal. While the purpose of the amendment is certainly sensible, the need for a modified proposal and the need also for a second reading, mean that even the new dates suggested are unlikely to be achieved. I believe it best, therefore, to leave this detail until the actual adoption of the common position and to set appropriate dates at that point. I hope, therefore, that this amendment can be withdrawn.
Amendment No 4 calls on the Commission to circulate all copies of all registration documents to all Member States and I can certainly support that amendment as a useful means of spreading relevant information.
Amendment Nos 2, 5 and 6 relate to anti-fraud measures. I can accept both the principle and specifically Amendment No 5 which requires the inclusion of the engine identification number on the registration document. However, the effect of the other two amendments would be to require replacement registration documents when certain new spare parts were installed in the vehicle, including for example a replacement window. I am sure that this could not have been the intention of those who drafted the amendment, since the results would obviously be extremely bureaucratic. I hope that on reflection honourable Members will not pursue these amendments.
Amendment No 7 were to have the effect of making inclusion of a vehicle's environmental characteristics in the registration documents compulsory rather than optional. Since such details could play a role in taxation regimes at some time in the future and since such features could also be subject to roadside checks, the Commission acknowledges the sense of making such information mandatory and we can therefore support this amendment.
I am very grateful to Mr Bazin and to his committee for the constructive attitude that they are taking to a proposal which will I am sure prove its worth to vehicle owners and to transport authorities and also be a useful addition to the efforts to combat theft and fraud. So I, together with Members of this honourable House, look forward to its progress into law.

President
Thank you very much, Commissioner.
The debate is closed.
The vote will take place tomorrow at 11.00 a.m.

Potato starch
President
The next item is the report (A4-0163/98) by Mrs Redondo Jiménez, on behalf of the Committee on Agriculture and Rural Development, on the proposal for a Council Regulation (EC) amending Regulation (EC) No 1868/94 establishing a quota system in relation to the production of potato starch (COM(97)0576 - C4-0045/98-97/0300(CNS)).

Redondo Jiménez
Mr President, ladies and gentlemen, today we are considering the reform of Council Regulation No 1868/94. Articles 1 and 2 of that regulation say that the Commission is obliged to present a report on the performance of the regulation, as well as proposals to extend the time limit, or change the regulation or the allocation of starch quotas in any way. The countries affected were Denmark, Germany, France, Holland and Spain. In January 1995 three more countries joined - Austria, Sweden and Finland. Therefore, a modification was made at that time, with the overall quota being adjusted to 1 869 000 tonnes.
The present proposal also lists the operational instruments upon which it is based, such as the minimum price of potatoes, the compensation payments to farmers, and the special premiums to industry. There are three reasons for paying industry: because of the structural disadvantages associated with starch manufacture; because of the limited value of by-products; and because of the seasonal nature of production.
I should like to describe to the House the contradictions I have found in the Commission's proposal. I think the criteria used in the proposal need to be examined here, by all of us. Firstly, ladies and gentlemen, I think we need to be sure whether we are talking about starch or about potatoes. If we are talking about starch, the price of starch should be the same whether it comes from potatoes or from cereals. In this case, there is discrimination in favour of potato starch, with an overvaluation of approximately 35 %, which needs to be looked at. If it is a question of potatoes, then I hope the honourable Members will allow me to say this: we are going to study this matter in depth and we are going to move towards a set of rules to cover the potato, not just for starch use, but for all uses, both for industry and for food. And here I would make a claim on behalf of many EU Member States: we propose a common organization of the market in potatoes.
As for assistance to the starch industry, it is paid because of seasonal variations, for not using by-products, and for agrienvironmental measures. I should like the Commission to bear in mind that if it is a question of seasonal variation then the whole of the agri foodstuffs industry should be paid. Is the Commission prepared to pay the whole of that industry for products which experience problems because of their seasonal nature? I think that would be a serious mistake. As for not using the byproducts, the same thing applies. How many industries are there which not only have no useful by-products, but also have to pay to get rid of them? So we are paying for something which others have to pay for themselves.
As for environmental measures, we have been paying the starch industry to take such measures for 20 years. I think they should have been taken by now.
What am I trying to say, ladies and gentlemen? Should we get rid of these subsidies? No: I think we policy-makers and the Commission should be flexible and remember the social, regional and environmental problems we are faced with. So in this case, I propose a careful study of how to implement a new COM in potatoes. In the case of potato starch, however, the status quo should be maintained for three years. When it comes to studying the new COMs, as we shall have to do, I hope the same arguments, which I have stated here as contradictions, will be taken into consideration. We are always being told there are financial problems, so we cannot increase our budgets. Nevertheless, ladies and gentlemen, the Commission proposal involves a budgetary increase of 26 %, which I think is highly significant. We are told that by cancelling things we could save ECU 150 million. With the oil question, we are talking about figures in the region of ECU 200 million, which is causing a big fuss throughout the European Union. So we are going to be consistent and apply the same criteria to all COMs.

Hardstaff
Mr President, I would like to thank Mrs Redondo Jiménez for her report and I have noted with some interest that she has pointed out some of the facts that I pointed to three years ago when I was asked to write a report on potato starch quotas. Just to go back for a moment, the quotas were introduced because there had been a huge increase in the production of potatoes for starch when starch from potatoes started to be treated, as far as subsidies were concerned, in the same way as cereals. Potatoes, grown for potatoes, to eat as chips or potatoes do not get a subsidy and it was because of a huge increase in production that these quotas became necessary.
I repeat again, as I said at that time, that it is a very questionable use of public funds to support people to grow potatoes for starch when there are other sources of starch. There has been a huge growth in the amount of money being used to support this production. Potato starch consisted of 48 % of the total starch exports in 1996-1997. No fewer than 385, 000 tonnes of the stuff! Why are we using public money to support people to grow potatoes to make into starch that we cannot use in the EU? We pay the producers to make the starch and then we pay them to export it because nobody wants it. This is an absolute nonsense and we should not be looking to extend these subsidies, we should be looking to reduce the quotas so that we are at the very least cutting out the export subsidy.

Schierhuber
Mr President, ladies and gentlemen, I should like to express my very sincere thanks to Mrs Redondo for her report, and in this case I should like to contradict Mrs Hardstaff quite frankly when she asks: why do not we take maize or corn instead of potatoes? Neither wheat nor maize can thrive where potatoes thrive, and that is why it is in particular the production of potato starch that is indispensable and an essential factor for certain disadvantaged regions of Europe. That is why it is also necessary for the future of the starch industry - because it, too, secures jobs - that the producer premium for potato starch is given to farmers. There is one other point which I want to mention: it is clear to all of us that high technology in starch production is essential for the firms or for the potato starch producers as well, and these processing plants also need reliable partners among the farmers. But the farmers can only produce the potatoes if these compensatory payments for the starch potatoes continue. I think that we should support the Commission's proposal in its present form, and also the proposal that the quotas for the next three years should be maintained.

Mulder
Mr President, it is not always the case, but this time my group can fully support the Commission's proposals in broad outline. We think that payments for starch from whatever source, including potato starch, should be made on equal terms. Why do we think that?
Firstly, the regions of Europe where potatoes for starch production are grown generally have soil that is not very fertile. Few alternatives are available. If we did not do this, large areas of Europe would be facing disaster. I therefore entirely disagree with the spokeswoman from the Socialist group. I would also have expected arguments of this kind to appeal to her, bearing in mind what it would all cost: at present I think we pay about ECU 200 million for this policy. Considering regional development in Europe as a whole, that is an extremely small amount. We get definite value for our money. What else is attractive about this industry? It has proved over the years that it can operate in a very environmentally friendly manner - no more environmental pollution. A further attractive feature of agricultural production for non-food purposes. These are very important developments. Recently there was a report in the Dutch newspapers that one of the factories had developed a product which could replace gelatine. Given the BSE problem, that is very attractive indeed. Factors of this kind must be encouraging. In the long run they are probably the salvation of industries like this one. For these reasons the subsidy we give is very worth while.

President
Thank you very much, Mr Mulder. But you were the one who allowed yourself to overrun by five seconds. I never cut anybody off. All I do is tell people, fairly forcefully, when their time is up. The responsibility for keeping to time or otherwise lies with each and every Member of this House.
It is now the turn of Mr van Dam, on behalf of the Group of Independents for a Europe of Nations. He has a minute and a half. We shall see if he allows himself longer than that, in which case I shall forcefully remind him that his time is up.

Van Dam
Mr President, the Commission's proposal to extend the quota system for potato starch by three years merits full support. The arrangement has contributed to a stable development of the market. The costs of the market organization for potato starch are being kept under control. In the interests of production planning for the next few years, it is important that the decision-making on the extension of quotas be completed as quickly as possible.
The rapporteur's amendments aimed at reducing support for potato starch production were rightly rejected by the Committee on Agriculture and Rural Development. A one-sided reduction in support for potato starch would seriously disturb the balance on the market between cereal-based starch on the one hand and starch from potatoes on the other. Hence any reform of the market organization for potato starch must be coordinated with reforms in the cereal sector. But I do not think that Agenda 2000 proposals for potato starch, in which compensation for a drop in price is only 44 %, are acceptable.
Finally, I would point out that starch potatoes cannot be compared with table potatoes. We are talking about completely different products and markets. A market organization for starch potatoes is necessary because these producers have to compete with cereal-based starch producers, who are generously supported through the MacSharry premiums, but there is absolutely no need for the market organization for table potatoes called for in Amendment No 3. The free market in this product works satisfactorily.

Imaz San Miguel
Mr President, I first wanted to thank Mrs Redondo Jiménez for her report on the quota system for potato starch. Also, an amendment has been added - Amendment No 3 - which calls for the potato problem to be analysed as a whole, including potatoes for consumption, because we need a COM to regulate the European potato market, in order to protect farmers from the price drops which regularly affect this product.
The potato market suffers cyclical ups and downs, leading to periodic price drops which seriously affect the production sector. So Europe needs to intervene to regulate this market. Let us not forget that the potato is the tenth largest agricultural product in Europe in terms of its volume of production. Furthermore, it is the only one of the 25 most important EU agricultural products not to be regulated by the Union itself.
Other products each cost the Community coffers ECU 2000 million, or ECU 1500 million in some cases. Nevertheless, there is no room for any sort of regulation of the potato, which is the tenth most important agricultural product in Europe. It is an inflexible market, in which an increase in production and the resulting price drop do not lead to greater consumption. There are studies which say this market can be regulated by establishing a system of quotas and areas, since it has been demonstrated that there is a correlation between the area under cultivation, the prices and the product.
As well as protecting the product, the potato, from its ups and downs, a regulatory system of this nature would not be administratively complex, and the budgetary cost to the Community taxpayer would be minimal. So I am in favour of this report being approved. But we should also call upon the Council, through Amendment No 3, to have the courage once and for all to find a system to regulate the problem of food potatoes throughout the EU, by means of a COM, now that they have had proposals on the table for 5 or 6 years.

Anttila
Mr President, I would like to congratulate Mrs Redondo on her report on potato starch production. It is to her credit that the rapporteur was prepared in the committee reading to accept proposals of compromise which give the report a much more balanced feel, and pay greater attention to the special circumstances pertaining to starch production in different countries.
The Commission is proposing to keep the quota system as it stands, in order to make the Community's starch markets more viable. In Finland domestic potato starch production is enough to meet only half the demand of the country's paper industry, and so Finland has recommended increasing its quota to 70 000 tonnes. That would satisfy existing production capacity more fully.
Because of its cold climate, crop rotation in Finland is in much greater evidence than it is in Central Europe. Because of that, it is difficult to apply the conditions of production to the quota's 5 % flexibility limit. With reference to the large-scale crop rotation that goes with potatoes, a transfer facility of 10 % from one year to the next seems quite justifiable, and thus I consider Amendment No 6 six to be very welcome. This is the proposal to be able to deviate from the quota by 10 %.

Cresson
) Mr President, first of all I would like to thank the rapporteur, Mrs Redondo Jiménez, and the Committee on Agriculture and Rural Development, which drafted the report on the proposed adaptation of the quota restriction scheme for potato starch. The proposal seeks to renew the existing scheme for a further period of three years.
The Committee willingly accepts Amendment No 1 which underlines the socio-economic importance of potato starch producers and justifies the steps taken in this sector. Similarly, the Committee accepts Amendment No 2 which lends support to the aim of maintaining a balance between the root vegetable starch and cereal starch sectors. With regard to Amendment No 3, relating to potatoes grown for food, the Committee is aware of the need to deploy a common market organization in the potato sector. This is why it submitted a proposal along these lines to the Parliament and Council in 1992. With regard to Amendment No 4, which seeks to impose a limit on the premium paid to starch manufacturers during the 1998-1999 campaign, the Committee regrets that it cannot accept this amendment which would be contrary to the interests of this sector due to structural constraints in terms of production. Similarly, with regard to Amendment No 5, the Committee does not see the need to specify a period of three years, as indicated in Article 1 of the proposal, or the reason why the amount of the premium set in the rules should be changed. Consequently, the committee is unable to accept this amendment. With regard to Amendment No 6, which seeks to increase the flexibility of the scheme, the Committee regrets that it cannot accept this amendment either, since it might boost production in a market that is already relatively saturated.

President
Thank you very much, Mrs Cresson.
The debate is closed.
The vote will take place tomorrow at 11.00 a.m.

Higher education
President
The next item is the recommendation for second reading (A4-0191/98), on behalf of the Committee on Culture, Youth, Education and the Media, on the common position adopted by the Council with a view to adopting a Council Recommendation on European cooperation in quality assurance in higher education (C4-0191/98-97/0121(SYN)) (Rapporteur: Mrs Heinisch).

Heinisch
Mr President, Madam Commissioner, ladies and gentlemen, European co-operation to ensure the quality of higher education. At first glance you might think that we were dealing in this case with a hopeless undertaking. On the one hand we have the cultural autonomy of the Member States, the variety of educational systems, the independence and individuality of colleges and universities, and these embodiments of the principle of subsidiarity are now at odds with the need to establish European quality standards in higher education, because in the Community there is undoubtedly a consensus view that comparability among European higher education institutions is an indispensable precondition for the promotion of student mobility in the European Union, which is the express wish of us all because we hope that it will lead to the European Union growing together.
But the comparability among higher education systems which is necessary to this end will be possible only if we succeed in reaching agreement on how to define and ultimately how to measure quality. Beyond that the question arises of who should appropriately hold responsibility for quality assurance measures. The positions which have been taken up by the Commission, the Council and the European Parliament in the course of the work on the recommendation with which we are now concerned offer a striking reflection of the difficulties that we come up against so often in the sphere of European educational policy, when it is a matter of achieving objectives which are desirable for the Community while strictly respecting the principle of subsidiarity.
In its original proposal, the Commission envisaged that it would be solely responsible for the creation of a European network which would take forward quality assurance and evaluation. Understandably, this was not acceptable to the Member States, and that is why at first reading the Parliament followed my proposal under which the Member States were to play an essential contributory role in the establishment of the networks. The underlying thought was that the establishment of a network could be successful only on the basis of mutual trust and co-operation, and it would have been very difficult to conceive of a European network without the corresponding national framework conditions.
The common opinion has picked up Parliament's idea on this decisive point. Its approach is to recommend the establishment of a network to the Member States, whilst the Commission is to be given the task of supporting co-operation between the competent authorities for quality evaluation and assurance in higher education. Alongside this essential point, the Council has accepted 13 further amendments from the Parliament either verbatim or in spirit. What is important to me is that two fundamental considerations on which I constructed my report are now established in the Council's opinion. Success has thus been achieved in giving clearer emphasis to the principle of the autonomy of colleges and universities and the preservation of their own understanding of their educational purpose. Equally, the very obligatory tone in which the Member States were called upon to take certain measures has been diluted by comparison with the original Commission proposal.
However, some of the amendments which the Parliament supported following my report have not been accepted. The Council has, for example, rejected involving the CEEC states in the quality assurance measures. Even if a recommendation to these states may at present fail because for legal reasons it cannot be directed at non-Member States, I nonetheless consider it important that we should not lose sight of the importance of their being involved, because it goes without saying that all the quality assurance objectives which we are pursuing apply as well to the states with which we shall be enlarging our Community in the near future. They, too, should share in the integrating effect at which our measures are targeted, and it will be important for them in particular to profit from Europe's capacity for innovation and to contribute to it.
A further amendment has not been accepted by the Council. I had supported the creation of evaluation systems for the research sphere as well in this amendment. In Germany where teaching and research form a single entity, it seemed to me a very obvious thought that the quality of a college or university can be judged only if its research achievements are evaluated at the same time. However, Article 126 of the Maastricht Treaty, on which our recommendation is based, does not allow any statement in relation to the research sphere. It is the legal base only for questions of education.
I attempted a compromise with the draft amendment which I have again introduced at second reading. This draft amendment also includes the sphere of training for research in the quality evaluation measures. In so doing, it falls within the legal base of Article 126 and can thereby include research evaluation in training.
I think that this will be of help as regards the dichotomy between the subsidiarity principle and the pursuit of education policy objectives. We are well aware that there are still some obstacles to overcome before this compromise can be realized, but the compromise should point the way for university education at the start of the 21st century. As we develop towards globalization, we in the European Union have to face up to international criteria and follow new paths in higher education policy. These will include inter-disciplinary and European courses of study. We need to recognise how important it is to base all our educational measures on a holistic concept of education. Finally we must all endeavour to develop partnerships and establish these in the place of fear of loss of responsibility.

Elchlepp
Mr President, Madam Commissioner, ladies and gentlemen, we support the common position and consider that it has taken account of our draft amendments. The guarantee of and progress in the quality of training and its constant critical review by colleges and universities and all of their members ought really to be much more a matter of course, in the interest of the best possible life and career opportunities for young graduates. Sadly this is not the case, to a greater extent in some of the countries of Europe, to a lesser in others. It undoubtedly comes as a bitter realization to students when they get to hear, often by way of dubious ranking procedures, that their university is poorly classified in public esteem because it perhaps missed the opportunity to make changes. It should at long last be common practice that every college undergoes an evaluation of its research and teaching and that international external experts should also take part in the evaluation groups.
For example, universities should ensure that they face critical questioning about how good and forward-looking the education they are offering is, whether they consciously give a European orientation to their courses of studies in the spirit of ERASMUS, and offer lectures and seminars in other languages, for example, whether they have reached agreements with colleges or sectors of industry in other countries in order to offer students practical experience abroad, or whether the college puts itself forward as a regional training centre for those in work or whether one subject area takes part in distance-learning. There will be some in research and teaching who will find it hard to re-think along these lines. That's the only way to overcome ossification. It is certainly important to ensure that training is assured on the basis of criteria that are as far as possible the same, but it seems to me questionable that new bodies should be set up for this purpose, such as a "network' institution on a European basis, especially since in legal terms it is on thin ice, and this should be rejected. It will not lead to any progress. What are important are permanent exchanges of experience about evaluation procedures between colleges and universities themselves. Individual projects can sensibly be supported by the EU.
In conclusion: what is wrong with the varied profiles of European colleges and universities? They are sources of innovation potential. Why should not architectural studies in Milan, for example, be offered with rather different emphases than in Aachen, for example, if the quality standards are good in both cases?

Sichrovsky
Mr President, many thanks for listening to my important remarks so late in the day. Guarantees of quality should certainly be welcomed. We should also welcome efforts to align quality in Europe. However, what has not been taken into account is the free access that we are addressing. Free access for students to all of Europe's colleges and universities will result in a hierarchy of higher education institutions, and will generate a competition which leads to efforts being made by all colleges and universities to attract students. That will be far more important than provisions aimed at aligning them with each other. However, the concept that has been mentioned of research training is somewhat questionable because research training would mean that special syllabuses would have to be developed for research.
Secondly, what is missing here is the propagation of co-operation between research and industry, because we know from experience that research only works properly where it is jointly organized with industry.

Cresson
Mr President, first of all I would like to thank Parliament and especially the Committee on Culture, Youth, Education and the Media and its rapporteur Mrs Heinisch, for having examined the common position of the Council in such a short space of time. In its broad outlines, it was in line with the spirit of the Committee's proposal. It also accepted a large number of the amendments proposed by Parliament on the first reading. In fact, the Council text contains all your major amendments such as those concerning the definition of an establishment of higher education, the diversity of national education and assessment systems, as well as the independence and individual character of establishments of higher education.
If we seek to promote an educational and vocational training system that matches up to the challenges before us, as expressed in the Treaty, quality assessment systems are essential tools, they make a positive contribution to policies favouring employment, growth and competitiveness. As you have seen, the principles on which the evaluation systems are based are clearly highlighted in the recommendations. Your contributions have added greatly to their further development. I remember that they are derived from experience in the field, in which many teaching establishments participated and it is on the basis of this experience that we have been able to single out the common features of teaching quality assessment systems across the various countries of the Union.
I would also like to mention the importance of this cooperative spirit if we wish to achieve a genuine transparency in teaching systems and to foster the exchange of mutual information between educational establishments on the content and quality of their teaching. This should further the cross-national mobility of students, the recognition of diplomas and qualifications and the free movement of qualified students in Europe.
With regard to the amendment proposed by the rapporteur, I concur wholeheartedly with the desire to show that higher educational establishments must improve not only the quality of teaching and learning, but also that of training for research. You will recall that the Commission was unable to accept at the first reading an amendment that referred to research in general, since this does not come within the legal premise underlying the recommendation. However, the scope of the amendment proposed today is clearly defined and restricted to training in research. I think we should introduce this amendment to the extent that in the teaching provided by higher educational establishments, training for research is often intimately tied to general education.
I have frequently stressed the importance of this recommendation towards promoting quality education in Europe. I can therefore only rejoice at the fact that the inter-institutional decision-making process has reached a very positive agreement. As soon as the Council has finally adopted the recommendation, the Commission will proceed as soon as possible to set up the network for quality assessment, whose work will be decisive towards creating the European educational space we all desire so earnestly.

President
Thank you very much, Mrs Cresson.
The debate is closed.
The vote will take place tomorrow at 11.00 a.m.

Fifth Framework Programme
President
The next item is the report (A4-0188/98) by Mr Marset Campos, on behalf of the Committee on Research, Technological Development and Energy, on the proposals for Council Decisions concerning:
I.the rules for the participation of undertakings, research centres and universities and for the dissemination of research results for the implementation of the Fifth Framework Programme of the European Community (1998-2002) (COM(97)0587/2 - C4-0015/98-97/0309 (SYN)); II.the rules for the participation of undertakings, research centres and universities for the Treaty establishing the Fifth Framework Programme of the European Atomic Energy Community (EURATOM) (1998-2002) (COM(97)0587/2 - C4-0016/98-97/0310 (CNS)).
Marset Campos
Mr President, Madam Commissioner, ladies and gentlemen, the proposal being presented on the rules for the participation of undertakings, research centres and universities and for the dissemination of research results for the implementation of the Fifth Framework Programme of the European Community and the European Atomic Energy Community performs the essential task of making it possible to implement the objectives and actions stipulated in that framework programme. Our committee's overall opinion was favourable, and we like the set of measures intended to provide the people concerned with access to Community research.
Our committee has focused on one or two aspects designed to solve the few remaining problems detected during past experience and previous calls for proposals. These need to be dealt with because the improvements introduced by the current proposal do not go far enough. Thus we express our concern about the effects of rapid technological innovation on some areas of research - especially in relation to the information society - as regards the composition of the applicant groups, as well as their launch and budgetary obligations.
Another of the improvements introduced refers to the need to guarantee that information about calls for proposals is accessible through other electronic media, besides the Official Journal, and in all languages.
We have also received many suggestions aimed at helping the applicants by speeding up the decision-making process, so that it takes no longer than four months to reach a decision.
We also thought it would be a good thing, when it comes to implementing the grants financially, to take account of the various aspects and different characteristics which come into play in each of the countries where the research groups are based, and to treat them all in the same way for that purpose, so as not to cause resentment.
One aspect the committee found particularly relevant is the reference to the property rights to knowledge resulting from work carried out under indirect actions, when the Community's contribution is 50 % or more. We did not think it right or adequate only to stipulate that right to shared property rights when Community funding was 100 %.
Something of particular interest throughout the Union is the fight against fraud. Although it seems incredible, we have also received warnings about this disgraceful practice, in some cases. For that reason, and taking as a legal basis the precedent provided by the judgements of the European Court of Justice, we have introduced specific corrective and preventative mechanisms, which also allow penalties to be imposed, if necessary, on groups which present anomalies or serious irregularities, or fail to fulfil their obligations in this respect. All of this arises from our concern to protect the financial interests of the European Community, as provided for by Regulation No 2988/95.
Passing on to other matters, we think it is right to use all the languages in order to provide contractors with the necessary information. Similarly, we think all the current resources of the information society should be used, especially for SMEs, universities and research centres.
Finally, we think it is quite right that substantive, detailed reasons should always be given, both for acceptance and rejection. I should point out that our discussions in committee were very full and covered other aspects, such as our concern to involve as many of the smaller SMEs as possible, or how to set priorities. We discussed the relative importance of the competitiveness of associated technological innovation and the satisfaction of the social needs of Europeans.
In short, by making this contribution, the European Parliament is fulfilling its function of directly representing the concerns and wishes entrusted to it, and is trying to perfect this proposal, which was already good, on this crucial subject.

van Velzen (PPE), W.G.
Mr President, Commissioner, ladies and gentlemen, first let me thank the rapporteur for the excellent work he has done. Here we are discussing rules for the participation of undertakings, research centres and universities in research, and of course the dissemination of research results. In fact I think that this report is at least as important as the content of the Fifth Framework Programme. You can do a great deal but, if the contractual arrangements are not right or the results are not properly disseminated, then you have still not achieved much.
Of course we have a great tradition. We have already had a number of framework programmes, and the Commission has rightly produced a great many monitoring reports, for which I am very grateful to it. A great many evaluation studies have also been carried out, and it is good to learn from them. Let me run through five or six points that have arisen out of this.
When you read the various evaluation reports, take ESPRIT for example, you realize that there are long bureaucratic procedures. Understandably, the Commission wants to be very meticulous, but the lead times are long and it is sometimes eighteen months before a decision is taken. Financial settlement takes a long time, and that is a particular problem for smaller enterprises.
A third aspect which is of course very important is that it is not geared to very rapid innovation. If you have long and cumbersome procedures, the advantage of speed will be lost. The reporting requirement is excessive. Though logical from a bureaucratic point of view, it can be a problem for smaller undertakings which want to participate in our research.
Finally, satisfactory agreements are not always concluded regarding dissemination.
If we now embark on setting up even more rules and obligations, we must look at these aspects. That is why we are proposing a number of amendments, which I hope the Commissioner will take seriously. I got the impression from the Commission that there was a lot of resistance to looking seriously at these amendments because there was already a pre-printed scheme for what the outcome should be. I think that is wrong, Mr President. I would also ask for it to be borne in mind that, at the present stage in the process, we often have clusters of SMEs that are working on a research project with one enterprise and that the enterprise together with the cluster of SMEs could constitute a single legal person. This is covered by Amendment No 1.
Amendment No 2 is of great importance since, if you have highly innovative projects which could thus, let us say, already be gone after a year, you should not have to apply the rule applicable under the ESPRIT programme, i.e. that it must have been operational for one year. We would therefore argue that, in those quite specific cases, in other words not as a general rule but in those specific cases, a description of the CVs and experience of the staff should suffice.
The third amendment takes account of the fact that the advance financing of the consortium must not take longer than six months at most. That can sometimes be a problem.
Amendment No 4 says that we should not only publish in the Official Journal of the European Communities. That is fine, everyone does that, but make use of technology. It should also be made available in electronic form, I stress also , that is, not instead of publication in printed form. We think it very important, in order to avoid wasting time, for a consortium to be entitled, once an application has been submitted to the Commission, to go ahead with its negotiations on legal and contractual obligations. Otherwise you lose time. That is bad for our research. If a consortium has been awarded a contract and does not start work, and we know of such cases, we have to apply a sanction. Then we simply say: if you have not started after four months, you must re-apply. That way I think we maintain speed in the whole process.
It is also crucial to specify in the contract how you stand with the dissemination and use of results. You must arrange for that in advance, not afterwards. You must also stipulate the output criteria. For example, I have seen stipulations for research results in projects giving no indication of what is expected to come out of it at the end. The Commission must insist that such a project give an indication of its output results.
We have proposed a number of amendments on these lines. I therefore hope that the Commissioner has looked favourably at them and will accommodate us in the matter.

Vaz da Silva
 Mr President, Madam Commissioner, rapporteur, ladies and gentlemen, the publication and evaluation of results are essential aspects of scientific research policy for countries with under-developed industries. Although their importance is enshrined in the Commission's text, I have reason to fear that in practice they are still not being dealt with satisfactorily.
So far as publication is concerned, electronic media are an excellent resource for those who know what they are looking for. But they are not reaching everybody. We have to find others for those who have yet to discover the potential that lies in exchanges of information and co-operation in the field of research and technology. These can be research centres such as universities, or equally they can be small and medium-sized businesses. I would like to say that it is important to keep the definition of SMBs at the present maximum of five hundred workers and not to reduce it to two hundred and fifty, as proposed in Amendment No 1. If that is done, a country like Portugal will be prevented from taking part in SMB support schemes, which is undoubtedly the opposite of what Mr Marset Campos intends to achieve by proposing this amendment. But the fact is that in Portugal only companies of a certain size can conduct research.
With regard to evaluation, which means the ability to convert research into production, one good way would be to promote liaison with the EUREKA programme. So I appeal to the conference which will conclude the Portuguese presidency of EUREKA in June to create conditions in which there can be interaction between the Fifth Framework Programme and EUREKA. And, since I have mentioned the implementation of the Fifth Framework Programme, may I enter a final plea that we do not make the mistake of reducing the marine science and technology budget, especially in this Year of the Oceans. They are the flagship of Europe. The world would not understand such a lack of vision and the future would not forgive us for it.

President
Thank you very much, Mrs Vaz da Silva.
Ladies and gentlemen, Mrs Vaz da Silva's speech brings us to the end of the contributions from Members of this House. So I now invite Commissioner Cresson to take the floor.

Cresson
Mr President, before all else I would like to thank the members of the Committee on Research, Technological Development and Energy, especially the rapporteur, Mr Marset Campos, for the work accomplished. I entirely share the sentiment of Mr Marset Campos: our rules of participation and dissemination must be comprehensible to all those engaged in research. They must be deployed with the highest degree of transparency.
Our proposals on this matter come within the much wider context of the efforts by the Commission to guarantee optimum management of Community research programmes. In particular, efforts will be made to simplify the procedures as much as possible and reduce delays as soon as possible.
The proposal under discussion was prepared on the basis of experience gained with the existing rules. These worked satisfactorily overall. Whilst being most important for the participants, as the rapporteur rightly pointed out, they are still quite technical. I will summarize the position of the Commission with regard to the two draft recommendations of the Parliament as follows. The Commission in the main endorses the objectives of Amendments Nos 4 and 8 (EC, Euratom). The first states that requests for proposals should be made public, rather than simply published in the Official Journal. The second expands upon the financial contribution methods of the Community. Pending reformulation, the Commission can partially adopt these amendments.
It cannot do the same for the other amendments. Although sharing their underlying concerns, the Commission is actually of the opinion that these amendments are already covered by the measures proposed, for example Amendments Nos 1 (ECEuratom), 5, 11 and 16 (EC), or they are likely to introduce daily management provisions in the theoretical texts invoked to govern research policy in its entirety, for example Amendments Nos 2 and 7 (EC, Euratom) and 14 (EC). Some are likely to raise problems of a legal nature, for example Amendments Nos 12 and 13 (EC). Others are to be considered within the context of the implementation measures, for example Amendments Nos 3 and 6 (EC, Euratom), and 9 and 15 (EC).
I am very grateful to the European Parliament for having grasped the urgency of this paper. The adoption of this recommendation at the first reading should enable the "research' Council of the 22 June to adopt a common position on the proposal. We are all aware that the existing framework programme, its special programmes and the existing contribution and dissemination rules expire at the end of the year. So we are engaged in a genuine race against time. If we wish to avoid disrupting the European research effort, the Fifth Framework Programme, its special programmes and the new contribution and dissemination rules should be ready in good time to enable us to proceed from the 1 January 1999. We are on the right track. However, I do not underestimate the difficulties awaiting us with regard to the adoption of the fifth framework programme under satisfactory conditions. I am sure that I can count on and continue to enjoy your support in achieving this goal.

President
Thank you very much, Mrs Cresson.
The debate is closed.
The vote will take place tomorrow at 11.00 a.m.
Ladies and gentlemen, we have now completed our agenda. I wish you a good night's sleep, which I know is well-deserved. May I remind you that our next sitting begins at 9.00 a.m. tomorrow, Thursday 28 May 1998, and is planned to finish at 1.00 p.m.
(The sitting was closed at 11.50 p.m.)

