Verbatim report of proceedings

Wednesday, 13 April 2005 - Strasbourg

2. Meeting of the European Council (Brussels, 22 and 23 March 2005)

  President. The next item is the debate on the European Council report and the Commission Statement on the meeting of the European Council (Brussels, 22 and 23 March 2005).

The President-in-Office of the Council, Mr Juncker, will take the floor first on behalf of the Council.

  Juncker, President-in-Office of the Council. (FR) Mr President, Mr President of the Commission, ladies and gentlemen, in this Chamber on 12 January I presented to you the programme of the Luxembourg Presidency for the next six months.

Today, as tradition dictates, I shall briefly present to you the results of the recent meeting of the European Council. I say briefly because, given the overwhelming attendance in the House today, the debate may not be greatly enriched. For this reason I do not seek to stoke the debate but simply to inform you that we agreed on the reform of the Stability and Growth Pact after some bitter debating, after macho and virile exchanges, although the occasional female voice did make itself heard in the midst of the stormy debate. The result at which we arrived represents a balanced outcome, because it attaches all due importance to stability and because it does everything possible to ensure that the application of the stability rules will not restrict the growth potential that exists and should exist in Europe. To this end, we did not interfere with the underlying principles of the Pact, but we did flesh out the framework, which means that the Stability and Growth Pact will henceforth apply in different ways in each phase of the trade cycle.

The reform that we finally enacted is the fruit of excellent cooperation, and I must emphasise this here, between the Commission and the Council or, to be more precise, between the College of Commissioners and the Presidency of the Council, between the Commissioner responsible for monetary affairs and the President of the Council of Finance Ministers. It gave me real pleasure to be able to work hand in hand with the Commission.

Everything has been said about the reform of the Pact, and much of what has been said borders on fabrication. Those who say that any deficit will be permissible once the Pact has been reformed and those who present the reform measures as a green light for Europe to follow the primrose path leading to mountains of debt are sorely mistaken. Neither the basic rules enshrined in the EC Treaty nor those set out in the Pact have been changed. The 3% and 60% criteria remain the cornerstones of a system which will continue to be based on clear rules and logical legal provisions.

I wish to reiterate here that, as soon as we identify a transgression of the 3% barrier, the Commission will compile a report, and the Member State in question will be placed under closer surveillance. I want to make it clear that – as has always been the case – a deficit in excess of the reference value, namely 3%, does not automatically trigger infringement proceedings. Some people are behaving as if this were an innovation, thereby revealing a lack of familiarity with the terms of the Maastricht Treaty, which introduced this provision back in 1992. The powers of the Commission have not been diminished by the reform of the Pact but have actually been strengthened. Accordingly, it is no longer a matter of being seriously concerned but rather of being seriously vigilant to ensure that the new rules are applied in a logical manner, and we shall make every effort to demonstrate, in the course of the coming months and in the decisions we shall have to take, that the Pact is far from dead but that it continues to apply and be applied.

The second item on the European Council agenda in Brussels was the mid-term review of the Lisbon Strategy. You will recall that considerable disquiet was expressed in our debate of 12 January by Members who felt that the Council was unravelling the fundamental balance of the Lisbon Strategy. After the Commission had presented its communication of 2 February on the Lisbon Strategy and its communication on the social agenda, the Commission and the Council – again acting together – succeeded in maintaining the basic balance of the Lisbon Strategy. We have, of course, realigned the Lisbon Strategy by focusing it more sharply on growth and competitiveness, but this does not mean that we have abandoned its social and environmental dimensions.

As I did a few months ago, I must again observe that the people of Europe do not always appreciate the importance of the Lisbon Strategy, because we speak of competitiveness, productivity and growth, and these terms and concepts do not stir the emotions. What Europeans actually want is to have a job, to be able to start a business and have access to start-up capital, to have open markets for their goods and services and to be able to rely on efficient communication and transport systems. They would like to be able to reconcile their working and family lives and to keep pace with new technological developments and the world of the Internet. They want access to good education for their children; they want to have at their disposal high-quality public services and all the services of general interest; they want decent pensions, and they want to be able to develop in a healthy environment. All of these things are objectives of the Lisbon Strategy. In order to give credence to the idea that governments and the Commission should henceforth be more proactive and consistent in implementing decisions arising from the Lisbon Strategy, we have consolidated the action to be taken into three strands covering ten areas of activity and illustrated by a hundred individual measures.

Many players are involved in the Lisbon Strategy: the Commission, the European Parliament, the national parliaments, the national governments and the regional and local authorities. All of these institutions and authorities must be able to derive more benefit from the Lisbon Strategy. I refer especially here to the national governments; since they are accountable to their national parliaments and to European public opinion, it is they that bear the responsibility for maximising the impact of the various components of the Lisbon Strategy.

Let me say a word or two about the directive that bears the name of a former Commissioner. On 12 January, I told you that the Presidency would say yes to the opening of markets in services and no to social dumping and that it would like to see all risk of social dumping eliminated from this draft directive. The European Council endorsed this position at its March meeting by asking those involved in the legislative procedure to make the substantive amendments that were needed to ensure that the draft fully meets the requirements of the European social model.

On this point, as on others, I wish to challenge the perception, and indeed the suspicion fed by ignorance, that the present Commission sees itself as the engine of a neo-liberal Europe. This has not been the impression I have taken from discussions with various members of the Commission, particularly on the directive concerning the internal market in services. This draft directive is the fruit of the deliberations of the previous Commission. The new Commission, together with the other European institutions, will make the amendments required by the European social model.

It was our ambition, Mr President, to clarify a misunderstanding that has taken root over the past few years, in that we wanted to demonstrate, by doing what we did, that there is a difference between the sustainable-development strategy and the Lisbon Strategy. It is wrong to present sustainable development as the third pillar of the Lisbon Strategy, because sustainable development is a cross-cutting strategy that affects all other policies and hence relates to all aspects of the Lisbon Strategy, such as the environment, fisheries, agriculture, public finance and social security. Sustainable development, in other words, is what is known in English as an ‘overarching principle’, which has to be applied in the implementation of every policy pursued by the European Union. For this reason, the Presidency will take the initiative of having the European Council adopt, at its June summit, a declaration on the guiding principles of sustainable development which is designed to serve as a basis for the renewal of the sustainable development strategy adopted by the European Council in Gothenburg in 2001.

On the basis of a decision taken by the Environment Ministers, we examined all the policies that have to be borne in mind whenever the subject of climate change is discussed. You will have noticed that the European Council welcomed the entry into force of the Kyoto Protocol and, more particularly, its ratification by the Russian Federation. It is now time to devise a medium- and long-term EU strategy to combat climate change, a strategy that must be compatible with the aim of limiting the increase in the global annual mean surface temperature to a maximum of two degrees above pre-industrial levels. In view of the emission reductions that are required on a global scale, efforts made over the coming decades will have to be underpinned by the common consent of all countries. The Union estimates that reduction profiles in the order of 15 to 30% in relation to the Kyoto reference values will be required of the developed countries by the year 2020; the long-term aim, according to the conclusions adopted by the Council of Environment Ministers, would be to achieve reductions in the order of 60 to 80% between now and 2050.

In the course of the European Council meeting in Brussels, we discussed a number of matters in the field of foreign affairs. I know you could scarcely contain your delight at what we said about reforming the United Nations. We took the occasion of the Council summit to return to the painful subject of Lebanon, a country which goes from one ordeal to another and which deserves the solidarity of Europeans. Accordingly, we called on Syria to implement rapidly its pledges to withdraw all its troops and intelligence services from Lebanon.

Mr President, I should have liked to present a more comprehensive picture, but I shall fill in the gaps at the end of the debate, if there is to be a debate.

(Applause)

  Barroso, President of the Commission. (PT) Mr President, Mr President-in-Office of the Council, honourable Members, I am delighted to come here today to share with you the Commission’s analysis of the conclusions of the Spring European Council and to explain how the Commission intends to follow up the important decisions taken there.

I broadly welcome the conclusions of the Spring Council, which were particularly significant, given that this Council was held at such a crucial time and that the EU needed to demonstrate that it is capable of addressing the main social and economic challenges currently facing Europe.

I believe that we have responded satisfactorily to this challenge and that the Commission has given the necessary impulse and political guidance. I must take this opportunity to praise the efforts and skills of President Juncker and, more broadly, of the Luxembourg Presidency, throughout this process. At this point, I should like to draw your attention to an idea, with regard to this Council, that I consider essential, both today and for the Union’s future: the idea of convergence between the main institutions.

Indeed, the first paragraph of the conclusions is clear on the Commission’s strategic objectives for the period 2005-2009, which I myself put forward: ‘The Heads of State or Government took note and welcomed the close agreement between the Council, the European Parliament and the Commission on the Union’s priorities, particularly with regard to legislative activity for the coming years’. It is this spirit that will help us overcome the difficulties that the Union expects to face in the future.

On the practical side, I should like to point out that the decisions taken at the European Council on the Stability and Growth Pact and the relaunched Lisbon Strategy will enable Member States to redouble their efforts to achieve the triptych at the June European Council, and hopefully to conclude the agreement on the Union’s future financial perspectives.

I would now like to comment in more detail on the three main subjects which, as you know, were discussed at the Spring European Council.

Firstly, the Stability and Growth Pact. As we all know, consensus on the Pact broke down in November 2003. A new consensus on a proper fiscal framework has now been reached. The Commission made a very important contribution to this end. The Commission launched debates in its 2004 public finance report and in September 2004 the Commission adopted a communication on strengthening and clarifying the Stability and Growth Pact. Since then, the Commission has actively contributed to the debate on the reform of the Pact and supported the presidency in its efforts to find a consensus, while preserving the essence of our budgetary framework.

The European Council’s agreement was a very positive outcome, restoring credibility to the Pact and preserving the Commission’s prerogatives. Under this agreement the Treaty principles are maintained. The budget deficit of Member States cannot exceed 3% of GDP and government debt is still limited to 60%. To avoid excessive deficits any overstepping of these limits can only be temporary and only in exceptional circumstances.

A new feature is that Member States are being asked to exercise more discipline. They must step up their efforts to reduce deficits in growth periods, while a degree of flexibility has been introduced for periods of economic difficulty.

The Commission intends to present its proposals for amending the relevant regulations before the end of this month so that reform can be completed by June. It is in everyone’s interest that we make rapid progress on finalising the reform of the Pact in order to offer greater transparency and predictability regarding public finances and budgetary developments.

This is an ambitious timetable but one that can undoubtedly be achieved with the cooperation of all the players involved: the Member States, the European Parliament, and the European Central Bank. I am sure that I can count on your cooperation in attaining these objectives. The Commission will do what is necessary to ensure the success of this joint project and is ready to work closely with you to do this, as requested in the joint motion for a resolution. In order to be effective, the Pact must count on the broadest political support, which is why wide support within Parliament is of the utmost importance.

(FR) Mr President, ladies and gentlemen, thanks to the very active role played by the Presidency, the recent meeting of the European Council has generated the political impetus that was needed to relaunch our pursuit of the Lisbon aims. We have put this strategy back on track by giving it clear objectives, namely growth and employment, together with targeted and effective initiatives and simplified instruments while respecting, needless to say, the permanent aims of the Union, particularly sustainable development. The Commission is extremely satisfied with this outcome, because its proposals were the starting point for the deliberations and conclusions of the European Council.

Personally, I am delighted that the Heads of State or Government approved and validated our approach so unanimously. This bears eloquent testimony to the role of playmaker that the Commission – supported, of course, by the European Parliament, whose major resolution on the subject deserves mention – can perform in fields which, we must recognise, are largely a matter for national governments.

The substance of our messages was well received. The discussions among the Heads of State or Government showed that the Member States had truly taken our ideas on board. In deciding now to relaunch the Lisbon Strategy, the Member States were also responding to the Kok report, which was discussed by the European Council in November. Their next task is to designate national coordinators and to prepare, by the end of the year, reform programmes setting out in detail the measures to be taken to boost growth and employment.

The realignment of the strategy towards growth and employment within a context of sustainable development won broad support. All available national and Community resources pertaining to the three strands – economic, social and environmental – must be exploited if these goals are to be achieved. The European Council provided the necessary clarification regarding the Lisbon objectives and their relationship with the sustainable development strategy. Improved governance, accepted as essential to implementation by the Member States, was also an important aspect, because it really served to test the credibility of the new Lisbon Strategy and to establish whether the Member States were genuinely disposed to accept a stronger system of governance. Their response was favourable.

The main elements of this system will be the integrated guidelines and the national reform programmes to be presented at the end of 2005. The task for the Commission now is to continue this work by formalising the follow-up to the conclusions of the European Council. I distinguish four key milestones for the coming months.

The first milestone was the adoption by the Commission yesterday, on 12 April, of the integrated guidelines which were presented to the House this afternoon by Vice-President Verheugen and Commissioners Almunia and Spidla. This is an important exercise through which the Commission confirms the sharper focus on growth and employment and provides the Member States with a single coherent framework for the preparation of their respective programmes. The European Council will be asked to validate this politically at its June summit.

Our approach creates added value in three respects. Firstly, it serves to enhance the consistency of the actions and reforms to be carried out in the macroeconomic and microeconomic spheres and in the field of employment, shedding necessary light on the process of economic governance and safeguarding the essential balance between the operational strategy and political visibility. Secondly, it initiates the preparation of the first element of the new three-year Lisbon cycle. Lastly, it provides the political and strategic framework within which the Member States are to construct their national reform programmes.

The second milestone in this process will be the presentation of a Community Lisbon programme. The European Council expressed the wish that the Commission present a Community action programme as a counterpart to the national programmes. This document, which is to be prepared for the coming summer, will list the actions that were enumerated in the document accompanying our communication of 2 February on the revision of the Lisbon Strategy. The Commission will also implement this Community programme rapidly by presenting the numerous major initiatives which we identified and which were confirmed by the European Council, such as the reform of state aid, the creation of a European Technology Institute and the i2010 initiative.

The third milestone will be a communication in the form of a methodological guide to national reporting. In this way, the Commission will provide initial guidance for the preparation of national reports. The fourth and final milestone will be the preparation and analysis of the national programmes, which, we envisage, will take place in the second half of the year. We have therefore seen, and we can now confirm, that this was truly more than a mere political declaration, that the European Council really sought to reclaim the Lisbon Strategy and that we are already in the process of putting it into practice.

On the fringes of the discussion on the Lisbon Strategy, the European Council reaffirmed the importance of an internal market in services as a means of achieving the key aims of growth and employment while emphasising the need to preserve the European social model. The European Council asked that every effort be made in the framework of the legislative process relating to the services directive to build a broad consensus behind each of these objectives. I must emphasise once again, as I did on 2 February, that the Commission believes it is possible to achieve this consensus. In this respect, your Parliament naturally has a crucial role to play.

The third major issue discussed by the European Council was sustainable development. I am gratified that the conclusions of the spring summit served to reaffirm the importance of the sustainable development strategy while making it clear that the Lisbon Strategy contributes to the pursuit of the broader aim of sustainable development.

In this context, it is also important to note that the European Council acknowledged the immensity of the challenge of climate change, specifying in particular that the global annual increase in surface temperatures must not exceed two degrees Celsius in relation to the pre-industrial era. I also note with satisfaction the warm welcome given to the Commission’s communication entitled Winning the battle against global climate change and the request that the Commission continue its cost-benefit analysis of strategies for the reduction of CO2 emissions. This will help the Union to devise a medium- and long-term strategy designed to reduce emissions in industrialised countries by 15 to 30% by the year 2020. The Commission intends to continue its activity through the second phase of the European programme on climate change.

Lastly, I am pleased that the European Council has clearly signalled the will of the Union to reinvigorate the international negotiations by exploring options for a post-2012 arrangement. The European Council wishes to see the adoption in June of a declaration on the guiding principles of sustainable development and intends to examine the revision of the sustainable development strategy in the second half of this year. In this domain too, the Commission will make appropriate proposals for the achievement of the Council’s aims.

Mr President, ladies and gentlemen, let me say in conclusion that the outcome of the spring meeting of the European Council, as you will surely agree, is an excellent platform from which to work towards reflation of the EU economy in the far broader framework of the quest for sustainable development. Much work, however, remains to be done before the objectives and decisions adopted by the European Council can be fully achieved and implemented. This will require the mobilisation of all interested parties, and I can assure you that the Commission, for its part, is fully mobilised to render its contribution without delay. I am counting on your participation and active support.

I shall finish as I started, by referring to the idea of convergence between the institutions, convergence on medium-term objectives, and I believe that it is this same spirit of convergence – which was also present yesterday, by the way, when I addressed the Temporary Committee on political challenges and budgetary means of the enlarged Union – which must prevail in the period ahead. The European Council managed to make significant progress at its spring summit, revising both the Lisbon Strategy and the Stability and Growth Pact. The next hurdle we must clear is the Financial Perspective. To this end, cooperation between the Commission and Parliament will be essential – as, of course, will be the work we do in close cooperation with the European Council.

(Applause)

  Poettering, on behalf of the PPE-DE Group. – (DE) Mr President, Mr President-in-Office, Mr President of the Commission, ladies and gentlemen, the Group of the European People's Party (Christian Democrats) and European Democrats welcomes the results of the spring Council with respect to the Lisbon Strategy. We believe that it has found an appropriate way of expressing its thinking, while the objectives are ambitious, but also realistic.

Like the Council and the Commission, we are of the opinion that our objective must be to improve the competitiveness of the European Union, that our objective must be to achieve more growth, and that we must also make use along the way of improved competitiveness and stronger growth to create more jobs. In doing so, it is the joint task of the Commission, the Council and Parliament to formulate our European legislation such that we do justice to this objective. This applies in particular to all the legislation connected with REACH, in other words to legislation on chemicals, where we, the European Parliament and the Council, have a huge legislative task to complete. I call on the Commission to also make its own contribution to this.

Within the framework of the Lisbon Strategy, we give a very explicit welcome to the good cooperation that now prevails, not only between the Commission, the Council and Parliament, but also – and more importantly – with the national parliaments. The President of this House suggested the – to my mind – very good initiative, that we here in the European Parliament should consult with our national counterparts on the Lisbon Strategy. That is good for the matter in hand, for the Lisbon Strategy, and also for cooperation between the European Parliament and the national parliaments and it should also serve as an example in other political sectors.

As far as the stability of the European currency is concerned, the great majority of our group would have welcomed our adhering to the rules hitherto. We stress very emphatically that confidence in the stability of the European currency is the basis for the confidence of Europeans among themselves and in the process of European unification.

One must, however, acknowledge – and here I speak in particular to the President-in-Office of the European Council with his experience; I think he was the only person here who was at Maastricht and signed the Treaty – that care was taken to ensure that no cutbacks were made to the 3% and 60% criteria. Hence, the interpretation that we could go to 4% or perhaps even more is absolutely incorrect. The conclusion expressly states that debt, if above 3%, should be close to 3% and that this is not carte blanche or an excuse for new, unlimited debt.

I call on the Commission on behalf of our group to continue to resolutely perform its role as the guardian of law and stability in future.

As far as the Croatia issue is concerned, although our group does not believe that Croatia is being treated fairly, we do welcome the efforts being made, especially by the President-in-Office of the European Council, to ensure that, ultimately, not only the International Criminal Court in the Hague will decide or hand down a preliminary ruling on whether negotiations should begin, but also that a commission will be set up to examine the situation in Croatia. I recommend that we start work quickly, so that negotiations with Croatia can commence.

I emphatically support what was said on Kyoto. We stand alongside all those who are resolutely promoting the reduction of emissions. In our joint resolution, Parliament's compromise resolution, we also take a stand under paragraph 35 on the weapons embargo with respect to China. Our message to the Heads of State or Government is that this House – and I believe that we are united in this – or at least this Group, would refuse to agree to the lifting of the weapons embargo on human rights and other grounds.

(Applause)

The top priority over the next few weeks is to adopt the European Constitution. We call on everyone involved to make their contribution, so that we achieve a majority in the referendums in France and the Netherlands, so that we also have a good basis for all subsequent referendums, because the Constitution is the top priority and we need the European Constitution for the future of Europe.

(Applause)

  Schulz, on behalf of the PSE Group. – (DE) Mr President, ladies and gentlemen, honourable empty Chamber, I have listened to Mr Poettering with excitement. We in the Socialist Group in the European Parliament were most interested to hear how he is coping now with the fact that a series of Christian Democrat Heads of Government hold a different opinion from the overwhelming majority in the Group of the European People's Party (Christian Democrats) and European Democrats in this House. He trotted out relatively elegant turns of phrase in order to conceal this rift in the conservative family of parties between the bloc in the parliamentary group, which itself is very heterogeneous rather than homogenous, and the Heads of Government.

What are the issues here? Mr Poettering began with Lisbon and emphatically welcomed the Lisbon Strategy. On that we are absolutely agreed. He was right to say – as were the President of the Commission and the President-in-Office of the Council – that signals were given at this summit about Lisbon and the implementation of the Lisbon objectives. That is also what we were hoping for, that is the good news from this summit; it is what gives us heart. On that we are absolutely agreed.

It will only be in the combination of the reform of the Stability Pact – and the need for greater flexibility which this also engenders for the national governments – and the defined objectives of the Lisbon process that the summit and its outcome will be correctly understood, Mr Poettering, because those who want to invest and should invest in the Lisbon objectives must also be in a position to invest in these objectives as states.

It is in the combination of the instruments needed to bring about greater flexibility now contained in this pact and the objectives of the Lisbon process, as described, that the particular attraction of the outcome of this summit lies. That is why we, the PSE Group, can emphatically agree with the results. This is also expressed in our resolution today, which we shall adopt with broad support; I assume that the sceptics in the PPE-DE Group will now agree to the wording on the Stability and Growth Pact, which is almost identical to that which we called for before this summit. We hope that they will do that, and take especial pleasure in it.

I listened with equal attention, Mr Poettering, as you spoke in favour – and I understand perfectly well why – of negotiations with Croatia commencing quickly. We shall see this afternoon just how much reliance can be placed on the statements by the PPE-DE Group when it comes to drawing conclusions during accession negotiations. If, however, those in Croatia putting their hopes in the reliability of your statements are perhaps treated this afternoon in the same way as Bulgaria and Romania, then we should tell them in advance in Zagreb that they should have another word with Mr Poettering.

(Applause)

The PSE Group emphatically welcomes the fact that the Council conclusions give hope in particular in a further area. In recent years, as far as Europe's role in the world is concerned, we have placed our emphasis as social democrats – in our demands – on sustainable development and climate change. The resolutions now being adopted – the President of the Commission referred to them once again – point the way. We must say to the citizens – I refer to your apt comments with respect to the referendum in France – that no country in this world and no European country, not even a highly industrialised country, will be able to meet the challenges of the 21st century alone. For Europe, that means in the Community alone: in the economic, monetary and social community and in the community which Europe can develop as a force, as a community for sustainable development and for reducing environmental dangers. These are global challenges and there is no France, Germany, Great Britain, Belgium or Portugal which can face them alone. It is the task of Europe as a continent and of the EU as the political form of organisation of that continent to counter these risks. That was a message from this spring summit which should not be underestimated. The social democrats in this House are also grateful for that and that is why we can agree to our motion for a resolution in the happy expectation of broad support, in good conscience, from the members of both the PPE-DE Group and the Group of the Alliance of Liberals and Democrats for Europe.

(Applause)

  Watson, on behalf of the ALDE Group. – Mr President, it often seems to fall to the smaller Member States to rescue Europe from the problems created by their larger partners. Mr Juncker, I fear you find yourself once more the victim of high expectations. The European Union is now facing major challenges which will test not only its capacity to provide for the hopes and needs of its citizens, but its very capacity to hold together.

The challenge which occupied the European Council is that of re-energising our economic growth potential. Our economy has stalled since the Lisbon Strategy was launched in 2000; it is almost as if a millennium bug of continental proportions has afflicted our competitiveness and depressed our determination to take tough decisions.

The summit was billed as a relaunch of the ten-year Lisbon Agenda, yet it left Liberals and Democrats with the impression of Europe’s leaders sleepwalking their way forward. The lofty language of the Council conclusions is unsupported by the dignity of disciplined thought. The text was high on rhetoric but low on action. Calls for undertakings to build new competitive factors, for consumers to benefit from new goods and services and for workers to acquire new skills were combined paradoxically with a demand for the Commission to rewrite a key piece of internal market legislation enabling growth in the services sector. The draft services directive can be improved, but it will be done in a serious manner by Parliament and the relevant sectoral council rather than by Heads of State playing to the gallery and pandering to nationalist sentiment.

The European Council conclusions speak of financial perspectives to provide the Union with adequate funds to carry through its policy commitments, especially the Lisbon priorities, yet Member States still call for a restrictive budget in one breath, while tying up foreign spending for seven years in the next breath.

Liberals and Democrats in this House do not share Mr Barroso’s satisfaction with the Spring Summit. Mr Juncker, we offer your presidency two cheers on ‘mission impossible’: your legendary ability to craft compromise has saved the shreds of the Stability and Growth Pact. Yet its loose wording and its get-out clauses send shivers down the spines of orthodox economists and Mr Berlusconi’s use of his new-found flexibility to offer tax breaks ahead of a general election shows the contempt with which irresponsible leaders will treat their eurozone partners.

What has happened to Europe’s leadership? Where is the sense of common purpose? Is it any wonder that French or British citizens show little enthusiasm for a new treaty, when two of our longer serving leaders have abjectly failed to explain and justify the Union to their compatriots? The vacuum in leadership at national and European levels threatens to derail not just the Constitutional Treaty, but the whole project. If the Constitution is not ratified the blame will lie fairly and squarely on those leaders who sacrifice longer term European Unity to short-term national popularity.

President-in-Office, I cannot escape the conclusion that your European People’s Party is failing our Union. You have failed to use your majority in the Council to build a coherent economic strategy at home. You are unable to marshal your troops here to see through our commitment to Bulgaria and Romania, to say nothing of their attitude towards Croatia that we have just heard. We are humiliated abroad when our Union conveniently discards its scruples to secure favoured trading status from totalitarian regimes in Russia or in China; when we turn a blind eye to such suffering in the Sudan; when we are silent in the face of American overreaction, imprisoning our citizens without charge, and denying airspace to our airlines. Under these conditions the European Union does a disservice to its citizens. Europe needs and deserves better.

(Applause)

  Frassoni, on behalf of the Verts/ALE Group. – (IT) Mr President, ladies and gentlemen, for once there is also some good news for the Group of the Greens/European Free Alliance in the conclusions of a European Council. It does not happen often, and perhaps that is why President Barroso said that the Greens are outside the system or anti-system. I do not believe that, and I hope to use the years and months that are left before the end of the parliamentary term to change his mind.

I also say that because we are not particularly pleased to note that the Commission held back precisely on the four points in this summit that we considered relatively positive, because it had taken a different position. The points are these: reform of the Stability Pact; precise target figures for the Kyoto Protocol, which the Commission unfortunately decided not to mention; redressing the balance of the Lisbon Strategy in terms of environmental and social sustainability, albeit still in a vague and imprecise way; and a kind of new-found understanding of reality with regard to the Bolkestein directive – although it is very hard to admit, even here in Parliament, that a directive on services of general interest needs to be drawn up before the Bolkestein directive is approved.

Even we believe that the reform of the Stability Pact has been a good thing and that it is now much more able to take account of the general economic situation and specific national situations. Of course, these positive aspects are strongly counterbalanced by the fact that the rules on the quality of spending are still too vague. For instance, choosing to invest up to EUR 700 million a year in building the international experimental thermonuclear reactor when even the most optimistic commentators do not expect that it can be used before 2050 – if ever – means not recognising the urgent need to implement the Kyoto Protocol or the potential of renewable forms of energy, and not investing in the latter sector. We see that as a serious mistake.

In addition, unfortunately, we have to recognise that during the European Council no account whatsoever was taken of the fact that a healthy macroeconomic environment must include taxation reform, so that the tax burden that today falls on employment is shifted onto environmental degradation, helping to make regular employment more attractive. That is what Jacques Delors was saying in 1992, and we have not made any progress at all since then.

President Barroso, Commissioner Verheugen, I think we should really learn something from the sad story of Italy’s economy and its Government, which came to power promising a new economic miracle by cutting taxes and environmental rules, and today the country is bottom of the table for growth and competitiveness in Europe. We believe, President Barroso, that the European Union needs to make itself seen and heard, partly to win the Constitution referendum in France and to convince citizens that European added value really exists, so that the Commission’s initiative in the framework of the Lisbon Strategy can result in new legislation. We are not happy with the fact that the Commission is content to play a coordinating role. We do not think that is enough, because it means that for French voters and others the only message coming out of Europe is that of the Bolkestein directive, the patentability of software and laissez-faire policies in the economic and social fields.

That is not what we want. We believe that we need to move in a different direction and, above all, we call on the Presidency and on President Barroso to take more notice of what we – and also the Commission – have called ‘the ecoefficiency revolution’. The ecoefficiency industry and companies of this kind are growing at a rate of 5% a year at the moment, and we believe we should be investing much more in this sector and taking it more seriously. Lastly, I agree with everything Mr Watson said, with just one exception: my group and I do not believe that hurrying and pushing and fighting with our backs to the wall for the accession of Bulgaria and Romania will help us to convince the Bulgarians, Romanians or Europeans of the feasibility of the project.

  Figueiredo, on behalf of the GUE/NGL Group. – (PT) Mr President, Mr President of the Commission, Mr President-in-Office of the Council, ladies and gentlemen, the recent downgrading of growth estimates announced by the Commission, and the capitulation that that implies in light of already low growth rates in 2004, demonstrates that restrictive budgetary and monetary policy at both European and Member State level has held back internal demand, public investment and economic recovery.

This has had an adverse impact on unemployment, poverty, social exclusion and the increase in social and territorial inequality, borne out by the 20 million unemployed and the 70 million or so people living below the poverty line, whilst the large corporations in the EU saw their profits rise by 78% in 2004, and profits as a proportion of GDP in the euro zone are currently close to a 25-year high.

Against this backdrop, how can anyone accept the so-called relaunch of the Lisbon Strategy, when it is based on competitiveness and on creating a workforce that is more attractive to companies, when it places the accent on deepening liberalisation in areas such as services, on increasing the flexibility of the markets, on reducing workers’ rights, on extending the number of sectors paying low salaries, when it seeks to keep proposals for directives on the organisation of working time and on creating an internal market for services? We do not accept it.

How can anyone accept the fact that the Council’s conclusions make only passing reference to social inclusion and refer only to children suffering from poverty, without putting forward a multifaceted and integrated programme to combat poverty and social exclusion? How can anyone accept that, despite the announced revision of the Stability and Growth Pact, the emphasis continues to be placed on meeting restrictive, albeit somewhat flexible, targets, while prioritising the dismantling of public, universal-access social security, when we know that public investment and maintaining public social security systems are essential factors in combating poverty and social exclusion?

Accordingly, we wish to stress the need to remove proposals for directives on working time and on the internal services market and to revoke the Stability and Growth Pact, replacing it with a Growth and Employment Pact. That way, priority can be given to creating 22 million high quality jobs with rights by 2010, to meeting the targets set at the Lisbon European Council and to halving poverty and social exclusion, as adopted in the 2000 Lisbon Strategy.

We believe that fighting inequality of income, promoting equal rights and opportunities and fostering genuine convergence should be at the top of the EU’s economic and social agenda.

  Clark, on behalf of the IND/DEM Group. – Mr President, after all that Mr Juncker said a month ago in this House and elsewhere to the effect that the Stability and Growth Pact was dead or at best needed to stagger on as it was, we now hear from the European Council that it lives again. Lazarus indeed strikes once more. But it is not living, it is fudging. In a year’s time this rotten pact will have to be fudged or dumped, as I suggested last time.

The meeting, however, was remarkable for something which it did not discuss: the UK’s budget rebate. Mr Chirac at least commented on it after the meeting, saying to reporters that it could no longer be justified, that it was from the past. Mr Barroso echoed those statements.

Perhaps you would like to justify the fact that the UK would pay into the EU 14 times more than France without the rebate, and, even with it, two-and-a-half times the French contribution. Mr Barroso also said that 70% of Commission spending was on agriculture when the rebate was agreed, whereas new proposals would reduce it to one-third. In fact, the proposals are that three-quarters of future spending will go to agriculture in poor regions. That is where the Commission’s priorities lie. That is of no comfort to the UK, rebate or no. Our Foreign Secretary said that the Commission’s proposal could mean a 35% hike in the budget, but he said our rebate remains a veto.

We have an election in the UK on 5 May. I would advise you not to try to join the flight from London to Brussels the following day. You would be caught up with party officials and government ministers, of whatever colour, as they rush over here to seek a compromise. It will be a milestone on the way to Britain’s exit. Worse is better because, in monetary terms, the EU will then be 14 times as bad for the UK as for France. Heaven knows, even with Mr Chirac’s desperate efforts, current polls show that the EU is becoming less popular in France every day.

  Muscardini, on behalf of the UEN Group. – (IT) Mr President, ladies and gentlemen, it really is a case of saying that the governments have at last understood that the Stability Pact must not act as a brake or even an obstacle to economic growth.

The results of the Brussels European Council have underlined the need for Europe to add a little flexibility to the rules that are paralysing the economy through too rigid and schematic an interpretation of the Stability Pact, which in the end has checked the development of many Member States.

With the downturn in the world economy and the new international situation, Europe needed to decide at last to overcome its inability to look to the future with the necessary flexibility.

It is no longer possible to imagine Europe being competitive on the international stage when its growth rate is only half that of the United States. It is no longer possible to believe that the value of stability, although a good thing in itself, is enough to overcome the inflexibility that has frozen growth for the last decade.

We are delighted that the European Council has achieved a broad consensus on reform of the Pact, and we highlight the agreement reached on the structural reforms specifying the corrective policy that Member States must adopt to comply with the Pact criteria if their deficit exceeds the limit.

The pension system, the research and innovation sector, training, and major structural and infrastructure works are investment commitments that are not always compatible in accounting terms with the limits set by the criteria.

While there is no doubt that the Pact must be applied fairly in the countries that have signed up to it, it is equally true that the economy of the European Union of the 25, which is characterised by considerable heterogeneity and diversity, requires a richer, more structured, common framework that can allow its differences to be better understood, without negating the objectives laid down in the reference criteria.

I should like to remind Mr Watson, to whom I listened very carefully, that there is no economic strategy because there is no political strategy, and because we are still using the economic and financial rules of the last century to face the new horizons of this century.

(The President asked the speaker to finish)

Mr President, other Members have exceeded the time allotted to them more than I have, and so the rules should be enforced either for everybody or for nobody.

  President. The rules are the same for everybody, Mrs Muscardini.

  Czarnecki, Ryszard (NI). – (PL) Mr President, the European Council is very fond of declaring that the Lisbon Strategy is its main priority, and true to form, it has done so again. I am reminded of a saying in the work of Nikolai Gogol, along the lines that ‘the old have not yet died, the young are still unborn, but they all pose a threat to the living’. The old strategy is in its death throes, the new one is still in short trousers, but they are both threatening Europeans with bouncing cheques, contradictory priorities and empty words. The President of the Council has stated today that Europeans do not take the trouble to read the Strategy, and that they do not like it, but that is not their fault. The reaction to many of the Council’s proposals is ‘yes, but…’ and the ‘but’ is only strengthened upon closer reading. This is true of the Framework Programme for Research and Development, for example. It should open wide the doors for research across the whole of the old and new Union. It must not, however, become a back door through which membership contributions of the richest Member States can be renationalised. Competitiveness figures prominently in the most recent Council documents. It is there on paper, but in practice, in real life, the services directive has been sidelined, when that directive was all about strengthening competitiveness and putting it into practice. Does the Council wish to have its cake and eat it? Asia should rejoice as it sees how Europe, its main competitor, is flagging. It is obvious what action should be taken, instead of generating fear within the Union. Small firms in Poland, Hungary, the Czech Republic, Slovakia, and Lithuania should receive the same treatment as firms in the old Union. You are all aware that this is not the case, ladies and gentlemen. The Council has referred to the reallocation of aid, and I am concerned that in practice this might mean less funding for the new Member States. The Council has not allayed these concerns. The Council has referred to reforming the system for regional aid. I am concerned that, to put it plainly, this might be an excuse to entrench the division of Europe into a poor new Union and an old rich one. The latter would be only too happy to forget about the principle of solidarity that is supposed to underpin the European Communities.

  Lulling (PPE-DE). – (FR) Mr President, Mr President-in-Office of the Council, Mr President of the Commission, ladies and gentlemen, things being as they are, I have only two minutes’ speaking time, and so I shall confine myself to the Stability and Growth Pact and say that the existence of a political agreement within the Council to revamp certain aspects of this Pact is good news. The Luxembourg Presidency can pride itself on a success which was by no means straightforward.

Be that as it may, this reform agreement brings us to a rather paradoxical situation, because, while the new version of the Pact comprises very sound innovations, particularly on the prevention side, it must also be recognised that it meets with only lukewarm approval. In order to dispel misgivings, there is a paramount need to tackle the key task of restoring confidence in a pact which has been mismanaged for too long and re-establishing its credibility.

There are still too many grey areas, which makes it inevitable that interpretation disputes will resurface with renewed vigour, enabling each government to interpret the rules as it sees fit. Too many doubts remain about the resolve of the Member States to adhere to a set of principles they have established for themselves. It is primarily a matter for the Commission, Mr President, to clarify these principles by incorporating the basic amendments laid down by the Council in its regulations of 1997, which form the framework of the Pact.

In these circumstances, the work on these proposals assumes particular importance, and greater attention to detail is imperative. I shall restrict myself to two examples. What specific commitments will arise from the preventive provisions of the Pact, which are to some extent a bargaining chip for the relaxation of rules in other areas? How can the reaffirmed need for simplicity, transparency and fairness in the procedure for dealing with excessive deficits be reconciled in these instruments with the sophistication of the mechanisms that are beginning to emerge?

As far as confidence and credibility are concerned, it is up to the Member States, of course, to render accounts and to demand consistency. Not even the most benevolent of observers will have failed to notice that the debates on reform of the Pact have mostly been more akin to pleas before an industrial tribunal than to discussions with even a hint of objectivity. I have to say that this detestable attitude has had devastating psychological effects, not only inflicting severe damage on the principle of equal treatment for all Member States but also apparently eroding the foundations of a community based on the rule of law.

IN THE CHAIR: MR TRAKATELLIS
Vice-President

  Goebbels (PSE). – (FR) Mr President, ladies and gentlemen, the spring summit has been a success. The Presidency deserves our congratulations for securing a decent compromise on the Stability and Growth Pact and relaunching the Lisbon Strategy.

Our Union is in a strange situation. We are the world’s principal exporter and the main market for the rest of the world. Our Union is a haven of peace, an attractive political entity to which more and more countries want to accede. At the same time, we are engaging in a sort of self-flagellation, wallowing in the predicted decline of the House of Europe.

The facts, however, refute this pessimistic view. Seen from outside, our Europe is a model of the good life. It combines a high standard of living with almost unprecedented social and environmental standards. Europe is creating jobs – 6.5 million over the past four years. Nevertheless, the unemployment rate remains excessively high in some of our largest countries.

Yes, our growth is slower than that of China, but an economy that accounts for almost a quarter of global GNP will invariably grow more slowly than a new economy taking off in a country that has experienced a century of stagnation. Even with a growth rate of only 2%, the economy of our Union expands every year by the size of the entire Taiwanese economy.

The prevailing theory is that Europe is being left behind by the United States in terms of competitiveness and productivity. On closer examination, it emerges that the American productivity gains are derived chiefly from particular parts of the service sector, such as wholesaling, retailing, real estate and financial intermediation, which are not in any way engaged in direct competition with their European equivalents.

Conversely, Europe admits to lagging behind – and there is a genuine gap here – in the fields of semiconductors and office machinery. Quite surprisingly, our businesses have a productive edge in the fields of communications and computer services. Indeed, Europe outperforms America in 37 out of 56 areas of economic activity. It is true that Europe is lagging behind in terms of research, and the private sector bears the brunt of the blame: whereas 80% of the 1.2 million researchers in the United States work for the private sector, only 48% of European researchers are employed by private companies.

The refocused Lisbon Strategy can and must provide responses to all of these problems. In order to maximise its success, the European Union needs a favourable macroeconomic framework. The reinvigorated Stability and Growth Pact, by allowing public-spending policies to be adjusted in response to cyclical trends and by enhancing the impact of investment, will help to promote growth.

Stability is unquestionably a public asset. The fact is, however, that the Union, and particularly the euro area, has never known such a high degree of stability. Inflation is no longer a problem, the currency is strong, and interest rates have reached an all-time low. We do need more growth and more domestic demand, particularly in some of our largest countries. The fact that Britain, Sweden and Denmark are achieving faster growth than the euro area, even with their higher interest rates, should give the European Central Bank food for thought.

The Socialists certainly support the President-in-Office of the Council, even though he is an eminent member of the European People’s Party, when he reminds the European Central Bank that, while it bears sole responsibility for monetary policy, the conduct of European economic policy is the task of national governments. This is another area where we need to insist on the ‘separation of Church and State’.

(Applause)

  Klinz (ALDE). – (DE) Mr President, Mr President-in-Office of the Council, Mr President of the Commission, ladies and gentlemen, I congratulate the Luxembourg President-in-Office of the Council on the conclusion of work to reform the Stability and Growth Pact last month. In its new form, the pact demonstrates a series of positive aspects.

The preventive aspect of the pact has been strengthened; the Member States have an incentive to put something away for a rainy day. At the same time, greater attention is being paid to the level of debt of the Member States.

The differing economic situations in the individual Member States have been taken into greater account than in the past. In this respect, there is a good chance of working in future on realistic solutions to problems, if deficit and debt criteria are exceeded. The reform of the pact should help in reconciling the economic policies of the Member States and, at the same time, highlight the need for a sustainable financial policy.

I do have my doubts, though, as to whether these positive aspects are sufficient to push the eurozone forward. I fear that these reforms will not be able to restore the lost confidence of the citizens. The reformed pact has too many weak points, in my opinion. In future, the European Central Bank alone will be responsible for ensuring the euro remains stable as, to all intents and purposes, the pact will no longer function as a second stability pillar.

The increased margin for interpretation and the unspecified special circumstances will tempt many Member States to run up new debts. This might soon force the European Central Bank to raise interest rates and jeopardise what is already only weak growth in the eurozone.

The Commission has emerged from the reform process weakened rather than strengthened, in my opinion. It seems questionable to me whether it will be able to effectively play its part as guardian of the pact. Consistent application of the sanction mechanism provided for in the pact in the event of infringement of the pact appears to be less probable today than ever before. I hope that it manages, despite these misgivings, to avert possible damage to the eurozone.

Revision of Regulations Nos 1466 and 1467 must include the clarification of unclear wording. The Group of the Alliance of Liberals and Democrats for Europe expects the European Parliament to be actively involved in the process of editing these regulations and supervising compliance with the pact.

  Hudghton (Verts/ALE). – Mr President, yesterday an opinion poll was published in Scotland that included a question about the draft EU Constitution. Scots in favour of signing up to the Constitution: 35%; those against signing up to the EU Constitution: 49%.

Five years ago, a much more positive response would have been delivered from Scotland. Indeed, historically, Scotland has been much more positive about engagement with our European partners than certain other parts of the UK. But, in spite of all the talk since the fall of the Santer Commission about reconnecting with citizens, many of our policies and directives are still seen as insensitive and inappropriate to real life in our communities, not least in Scotland with the disastrous failure of the common fisheries policy. But I think the services directive has the potential to further undermine public confidence and I do not think it has been sensitively handled so far by the Council or the Commission.

It is widely seen as a further attack on essential public services. Much has been said about the potential effects of the country of origin principle, but, if we are to be sensitive to the reality, there is much more to it than that. For example, in the UK, Scotland’s legal and regulatory system is entirely separate from that of England and Wales, and so on. I would like to see more recognition than we have to date not only of sensitivities at Member State level, but of differences within Member States as well.

  Adamou (GUE/NGL). – (EL) Mr President, despite the fact that the President-in-Office of the Council has left and the President of the Commission is engaged in conversation, I shall say what I have to say. Unfortunately, Lisbon puts social policy in second place. With the changes proposed to the Stability Pact and to the Lisbon Strategy itself, the Lisbon Strategy cannot be made into a pro-grass roots strategy. It is a paradox and it is absurd for us to talk about creating the most productive economy on the planet and, on the other hand, to want to cut budgets, in other words to have less cohesion. Only with a series of radical measures, which also include other levels, could Lisbon become a pro-grass roots strategy.

The Confederal Group of the European United Left – Nordic Green Left disagrees in its entirety. We are calling for a real social state to be introduced in Europe with the objective of full employment. For a strategy to be introduced with the objective of a high standard of living, without being sacrificed in the face of the need to increase competitiveness. For so-called flexible working times, which rot the social fabric, to be abolished. For a proper 35-hour week to be introduced without any reduction in wages, which would mean recruiting more people. We are against a strategy of unilateral growth for the benefit of big business and the private sector. We shall continue in our efforts to get those in charge at the European Commission and in the Council to take a stand at long last which will do away with the accountant's approach in favour of an approach which puts people first. This can only be achieved through radical changes to the Stability Pact and to the Lisbon Strategy.

  Blokland (IND/DEM). – (NL) Mr President, the European Council has declared that the services directive should be given a more social dimension. After all, it cannot be the intention to take advantage of workers from Member States where working conditions are less strict, or to compete unfairly with service providers in Member States where strict working conditions apply. Failure to comply with current labour law will lead to unwanted situations and this concern has caused anxiety among the public. The directive allows for the fact that, in accordance with European rules, service providers are bound by the labour law that is applicable locally. That does, however, presuppose that this labour law is enforced effectively; if it is not, people will definitely be taken advantage of and competition will be unfair. To date, the guarantees of enforcement provided by the proposed directive have been inadequate. In the proposal, the task of enforcement was assigned to the country of origin rather than to the country of destination, which leads to an unworkable situation. Indeed, one cannot expect Polish authorities, for example, to check whether Polish workers in the Netherlands do their jobs in accordance with Dutch working conditions. We need a different approach to establish a workable system for enforcing working conditions in all Member States. The country of origin will at least need to declare that its citizen will become active in the country of destination. It follows that the exchange of information is the first step in making the enforcement of labour law possible. I assume that the Commission will include this duty to report in the directive.

Eight environmental organisations drew attention to this directive’s implications for nature, the environment and health, and they were right to do so. It seems as if the integration concept in the EU Treaty, with sustainable development as its ultimate goal, has been temporarily overlooked.

All in all, the Council has not made it clear what direction it wants to take and how the directive can be afforded a more social and more environmental dimension, which was, after all, the object of the Lisbon process. The fact is that it was up to Parliament, rather than the Council, to make the next move in the legislative process. Despite this, the Council put the services directive on the agenda to accommodate specific interests of individual Member States, which has knocked the institutional framework off balance. It appears that at the moment, the Council sets great store by giving this social dimension greater prominence, given the debate surrounding the European Constitution in France, even though there are more appropriate arguments that could be used against this Constitution.

  Krasts, on behalf of the UEN Group. – (LV) Mr President, when we assess the results of the European Council we are forced, unfortunately, to conclude that discussion of the Services Directive occupied centre stage there. The result of debate on the Services Directive, which the Commission in its former composition has bequeathed as its legacy, is noticeably diminishing enthusiasm for the attainability of the Lisbon Strategy goals as rewritten by the current Commission. The directive was intended to increase competition in sectors which are open to competition, in order to gain consumers, and provides support to small and medium-sized enterprises for whom cross-border operations are at the moment impossible. In its proposed wording, the directive was rejected as a threat to Europe’s social model. To a surprising degree, most of the criticism was directed towards the application of the country of origin principle to the provision of services. This is the guiding principle in all internal market legislation and the European Court of Justice has consistently upheld it in its decisions. The Commission is losing one of the few existing instruments at its disposal and what is currently one of the most important cornerstones of the reinvigorated Lisbon Strategy. Reform of the Stability and Growth Pact from an economic viewpoint is understandable, but would be fully justifiable only if the European Union were a unified state. As they say, it is difficult for the hungry man to understand a man who has eaten well. Thus, the Stability and Growth Pact, which was adopted in good times, is inconvenient in difficult times. In the good times the policy designers lacked the will to save up for a rainy day, and in the bad times the wish to carry out structural reforms is lacking, so no alternative remains but to change the terms of the pact. Reforming the pact reduces Member States’ fiscal discipline and does not encourage them to improve it in good times. The difficulties created by a weaker common currency and higher lending rates will, however, be shared by all the Member States, including those which behaved well during both the good and the bad times. The decisions of the European Council will have a knock-on effect in every respect. I would like to hope that the attitude towards the Lisbon Strategy will differ from the Council’s reception of the Services Directive, that the positive aspects included within the Lisbon Strategy will provide the hoped-for impetus, and that a lack of fiscal discipline and of structural reforms will not endanger the European social model.

  Vanhecke (NI). – (NL) Mr President, it cannot be denied that the past European Council was actually dominated by an external factor, that being the referendums on the European Constitution that are due to be held in various European countries. It is in the context of those referendums that we should see the decision to review the services directive. It is, in fact, very much open to question whether this Bolkestein directive will actually be re-examined or amended once the referendums are over. It is, after all, a fact that European decisions are taken over the heads of the public almost as a matter of routine, and that there was, in the past, more than one occasion when such old-fashioned concepts as truth and democracy were not taken entirely seriously.

As far as the Bolkestein directive is concerned, we have to say that it has ambiguity written all over it. Even European law specialists hold fundamentally different views about how this matter can, or will, actually be fleshed out in reality. It is a fact that the very broad definition of the concept ‘service’, coupled with the country of origin principle, will lead to drastic changes to states’ – and in some cases federal states’ – powers and responsibilities. Moreover, the proposal undeniably impacts on states’ powers and responsibilities in terms of social security, health care and education – all areas to which, in my modest opinion, the principle of subsidiarity should strictly apply. According to Mr Bolkestein, only the rules of the country of origin apply to the service providers. It is a complete mystery to me how it is possible to avoid distortion of competition or even social dumping with those rules, and I also wonder whether this is of real benefit to the European consumer.

Allow me also to be particularly sceptical about the hundreds of thousands of new jobs that this directive is supposed to create in Europe. Along with everyone else, I am still waiting for the millions of jobs that those self-same economists promised us would be created when the euro was introduced. I would reiterate that I have no faith whatsoever in the Council’s promise to make subtle changes to the Bolkestein directive. I have no faith in the sudden conversion to the ‘own people first’ principle of so many Left-wing politicians who are anxious about the outcome of the referendums on the European Constitution. As in the case with Turkey, EU policy is often a string of deceit and shameless lies, and I fear that, with the Bolkestein directive, we are getting more of the same today.

  Grossetête (PPE-DE). – (FR) Mr President, let me begin by addressing my congratulations to the President-in-Office of the Council for the role he played at the spring summit in achieving the necessary consensus among all the Member States at an extremely delicate period in the history of Europe.

As far as the Stability and Growth Pact is concerned, I believe it is important, because it guarantees the stability required by the single currency. What Europe needs, however, is criteria rather than dogma, and numerous voices in this Chamber had been calling for more flexibility. What we really need is economic governance. This pact is also a growth pact, so why should some countries be penalised if they invest more in research, defence and infrastructure than other countries? This is nonsense and is in glaring contradiction to the Lisbon Strategy.

On the other hand, uncontrolled and unwarranted increases in deficits and indebtedness must be severely penalised, and the national parliaments must immerse themselves fully in their role as scrutineers of their governments’ budgetary activity. These are the same governments with which we must deliberate on the advent of a generation of senior citizens very advanced in years. We shall have more and more centenarians. We can only welcome such a development, but it does imply a transformation of both our social and our economic systems.

Mr President-in-Office, Mr Barroso, we shall listen carefully to the proposals you make at the Council summit in June on the sustainable development strategy in conjunction with the economic and social reinvigoration demanded by the Lisbon process. Climate change presents Europe with another challenge. Lastly, let me say that I welcome the commitment to start work on the construction of the International Thermonuclear Experimental Reactor (ITER) in Cadarache before the end of 2005.

We must regain the trust of the European people, who are anxious that we should avoid any social and fiscal dumping. This is what we shall be trying to do here in Parliament in connection with the services directive, and I was astonished to hear the previous speaker expressing doubts about the role that Parliament can play in this respect. Let me remind you, ladies and gentlemen, that legislative power is shared between the European Parliament and the Council.

What is actually lacking in this Europe of ours are enthusiasm and self-confidence. It is up to all of us to reassure and convince people, and that is what will enable our fellow citizens to embrace the Constitution which is indispensable to a Union of twenty-five Member States.

  Swoboda (PSE). – (DE) Mr President, Mr President-in-Office of the Council, Mr President of the Commission, ladies and gentlemen, seldom has a Council document – even in this House – been so well received, and this is also reflected in our resolution. In fact, I see a certain convergence between the Council conclusions, the Commission's conclusions and the views of the majority in this House. The issue here is a social Europe in global competition. This needs to be highlighted, because many members of the public have gained the impression over recent years that it was indeed all about competition, but not about a social Europe, or that social Europe was getting lost on the way. One speaker today voiced the opinion that the political leadership in many countries was to blame for the Constitution being seen in such a negative or critical light. I do feel, though, that this was perhaps because many people could not identify with this Europe, because they felt that the social aspect was being neglected or left out.

What this Council has achieved with the reform of the Stability Pact – and on this I should like to give the Luxembourg Presidency our warmest congratulations – is not opening the door to more debt; it is taking account of the individual situations of certain countries and it is greater flexibility. What was said about the market in services – admittedly on a global scale – concerns the opening of a common market, not social dumping, as Mr Juncker mentioned last time. That is also our line. I am delighted – including about what Mrs Grossetête said, and I hope that goes beyond the date of the referendum in France – that we are finding a common line here, in order to achieve an opening for Europe which takes account of the social model.

Too little perhaps was said about the Youth Pact. It is very important that we send our young people the signal that their Europe should be a Europe of employment and a social Europe. Taking account of social questions does not exclude the fact that we need to move forward on several reforms.

One point which I should still like to mention in conclusion is research and development. We have a new proposal for a research and development programme. I hope, Mr President-in-Office, that you and, more importantly, your successors will manage to invest enough money, initiatives and energy in this research programme because, if we want to keep up with the competition, we must promote research and development.

(Applause)

  Ek (ALDE). – Mr President, we are very worried about the current growth rate of the European economy, the high unemployment rates and all the social and environmental problems we have to deal with. Therefore I am glad that a couple of weeks ago Parliament adopted a resolution on the Lisbon process and that a lot of its suggestions were taken into account at the spring summit. However, I am still very worried. I shall give some examples on law-making and on policies.

Firstly, with regard to the Reach Programme, it is very important that we come to a decision. That is what Parliament declared unanimously a couple of weeks ago. Uncertainty is very expensive.

Secondly, with regard to the social services directive, Parliament is much more agreed on the necessity of that directive than the Council. We need a firm line on this because the unemployment rate is a catastrophe for human beings and the economy.

With regard to policy areas, we talk about SMEs and we produce very nice documents on them and on the importance of cutting red tape. Now, risk capital is essential to the work of SMEs. At the same time that we talk about the SMEs, unemployment etc., in the aftermath of the Lamfalussy report there are now 240 sub-groups working on new legislation for the financial markets. That is exactly the opposite of cutting red tape and getting enough risk capital for the SMEs.

The second policy area is energy. We know that we have environmental problems, unemployment problems and regional development problems and that we need the production of biomass, district heating and trigeneration. Yet there is no cooperation between agricultural policy, energy policy and industrial policy. This cooperation is necessary; it is extremely important.

Parliament and – I believe – the Commission are determined, but the Council is not being tough enough. You have to be tougher, Mr Juncker.

  Turmes (Verts/ALE). – (DE) Mr President, the Group of the Greens/European Free Alliance does not want a Europe that plays fast and loose with our social and environmental benefits, which are part of our European identity. Nor do its citizens want it to. We therefore welcome the clear language of the Luxembourg EU Council Presidency and its commitment to the triad of economic, environmental and social issues.

The conclusions of the spring summit are good European conclusions, have clearly put the Barroso Commission in its place, and shown it the error of its neoliberal tendencies. These celebratory declarations must now, though, be backed up by visible action, especially in two sectors: in environmental protection, we need European efforts for climate protection at long last, and this needs to be reflected both in the financial perspectives and at the European Investment Bank. Investments in public transport, investments in decontaminating buildings and investments in distant heating networks reduce climate damage and our dependence on oil. Little was said at the summit about the problem of oil and how it curbs European growth.

In social policy, this means that we need a directive to protect public services at long last. One of the priorities of the remaining months of the Luxembourg Presidency should be to set this directive on public services in motion, because otherwise the spirit of Bolkestein will continue to hang over Europe.

  Wagenknecht (GUE/NGL). – (DE) Mr President, if a house’s foundations are rotten, you cannot help it withstand the winter by improving the roof. The Stability Pact does not deserve to be reformed, it deserves to be abolished. In particular, the new provision for taking account of so-called structural reforms clearly shows what it has always been about: it has not been about price stability or about solid government finances; it has been an instrument to justify rushing through neoliberal liberalisation and privatisation plans, plans whose implementation had already pushed the profits of European conglomerates up by 78% in 2004. However, those who reap the profits are clearly far from satisfied.

The proposal for a services directive is a new attempt to finally lay the European social model to rest. Instead of harmonising standards upwards, we will see an unrestrained dumping race to the lowest common denominator; instead of welfare as and where required, all sectors of human life will be commercialised. That is obviously the vision for Europe which the think tanks of the major groups, the business lobby, have in mind.

Seventy thousand people demonstrated in Brussels in March against the brutality of the neoliberal project. They will be watching to see if the Council's criticism only had the imminent Constitution referendum in France in its sights or if serious deeds follow.

  Piotrowski (IND/DEM). – (PL) Mr President, ladies and gentlemen, at its latest meeting the European Council recognised that there is very little to show for the Lisbon Strategy at the half-way stage. It has actually been a total failure. I would remind the House that the Union has not achieved the target of 3% economic growth it set itself, and the gap between per capita GDP in the EU and in the US has actually grown, when it was supposed to disappear. There has only been a slight increase in expenditure in the key area of research and development, and employment growth in the areas singled out by the Lisbon Strategy has fallen far short of expectations. There are still significant obstacles to the free movement of goods and services within the Union.

A condition for that sustainable and balanced growth that is now simply wishful thinking would be liberalisation of the services market. I use the words ‘would be’ advisedly, as freedom of economic activity remains theoretical, despite long-standing provisions in the Treaty to that effect. The liberalisation process has been met with strong opposition on the part of officials and trade associations in the countries of the old Union. Its opponents argue that the quality of the services provided by enterprises in the new countries is lower, and that the latter are engaging in social dumping. At the same time, the opponents of liberalisation are discriminating against their own fellow citizens by forcing them to pay unduly high prices for the services they require.

I firmly believe that another key catalyst for economic growth would be to turn cohesion policy into something more than simply a propaganda slogan. If the Lisbon Strategy is to be saved, the Council, the Commission and above all, EU officials must remember the true meaning of the principle of solidarity and how a free market actually operates.

  Dillen (NI). – (NL) Mr President, ladies and gentlemen, it is surprising how impending elections can sometimes make politicians change tack and even get them to deny their own principles. For example, I take some malicious delight in the truly sad soap opera that is being played out in Europe in response to the Bolkestein directive. After all, before 1 May 2004, we did not hear anybody complain about the liberalisation of services, because the Dutch commissioner’s plans simply fitted in with the European logic that service providers too should be able to work freely in the EU. In order to accommodate President Chirac, though, and to ensure that he does not suffer a humiliating defeat in the referendum on 29 May, it is now reported that the directive – having, of course, been approved by the socialists Mr Lamy and Mr Busquin – will be amended again, if not rewritten. Now it turns out that the directive is being put on ice for the time being so as not to give the French ‘no’ camp any more trump cards.

The European Left have discovered that social dumping puts the jobs of their own people at risk. It has also rediscovered the importance of upholding national and sovereign interests. The French Left, again faithful to the traditions of the pre-war Front Populaire, has rediscovered the ‘own people first’ principle, which it formerly abominated, and rejects the directive’s country of origin principle. It remains to be seen, of course, whether this hypocrisy will be enough to prevent the ‘no’ camp from enjoying a landslide victory on 29 May. Contrary to what the luminaries in the Commission may think, the electorate is not stupid. A similar scenario is unfolding in Germany; today’s Herald Tribune reports that the Social Democrat Chancellor, anxious as he is about the elections taking place next month in North Rhine-Westphalia, wants to impose stringent measures in order to avoid cheap labour from Eastern Europe taking jobs from the Germans. Who would ever have thought this former internationalist Marxist capable of such a thing? We can do no other than congratulate him.

  Thyssen (PPE-DE). – (NL) Each generation has its own challenges to face. In the 80s, we were told how to improve our competitive position, and the 90s were about reorganising government funding. Now that we are being confronted with increasingly aggressive worldwide competition, along with an ever-changing world and an ageing population, we have to rise to the additional challenge of safeguarding our social model, which presupposes economic growth in the first place. Meanwhile, everyone now realises that it is not enough to respond to those challenges with declarations and unfulfilled promises. People are disillusioned; they want to see action and results. Following the European Summit, we can say that there is interinstitutional agreement and some sort of commitment to Lisbon’s revival, and that is why the summit’s conclusions are a hopeful new beginning and the presidency deserves credit. Let us interpret it that way to the people, and, as the President of the Council suggested, in their own language. Needless to say, we hope that the new regulations on the Stability Pact will provide convincing proof of the message that the President of the Council brought us, and that we can rely on clear criteria and sufficient enforceability. We are also pleased that the conclusions have highlighted the importance of small and medium-sized enterprises, and we hope that this will be more than merely lip-service.

With regard to the services directive, we have to conclude that, although a major communication battle has been lost, we have not lost the war. As co-legislator, we will do everything in our power to make the free movement of services possible and we will ensure that this is done in a way that is consistent with the task of our generation, namely securing our social model with its three dimensions. Mr President, Parliament’s steering committee for the Lisbon strategy agreed yesterday to work flat out, and, for our part, I can assure the Council presidency, the Commission, together with my fellow Members of this House and the members of the national parliaments, that we will continue to be firmly committed to achieving the objectives, and our cooperation with that end in mind can be relied on.

  Rasmussen (PSE). – (DA) Mr President, I see that Mr Watson is not present in the House, and that is something I regret. I must clearly dissociate myself from Mr Watson’s criticism of Mr Juncker, President of the European Union. It is not of course Mr Juncker’s fault that France now has a government so unpopular that it is in no position to convince the French population to vote in favour of the Treaty. The truth is, of course, that Mr Juncker himself, via the European Council held in March of this year, has ensured that the rest of us are in a position to explain to the French population that we now have a sensibly designed Stability and Growth Pact, that the balances in the Lisbon process have been retained and that we are now in a position to tackle the next step, as pointed out by Mr Almunia, Economic and Financial Affairs Commissioner, who said that, by using the two instruments, together with macroeconomic initiatives, we are in actual fact in a position to create more, and new, jobs in Europe.

I should like to say to Mr Watson, to the Group of the European People’s Party (Christian Democrats) and European Democrats and to others, irrespective of whether or not they are present in the House, that what is at issue here is a responsibility shared by them and ourselves, as well as by the President of the Commission, Mr Barroso, by the whole of the Commission and by Mr Juncker and the Council. We must show the French population that this European Union has one main task right now, and that is to help create more, new and better jobs. France cannot create more, new and better jobs alone. France and the French people need a new Constitutional Treaty, and this new European structure, together with the political approach now set out by the March European Council and, hopefully, continued by the June European Council, provide us with some sound arguments for making further progress with our work on Europe. Europe is not a matter of daily spectacle and major revolutions. It is a matter of hard, sensible and purposeful work, and that is something on which I should like to compliment Mr Juncker today.

  Letta (ALDE). – (IT) Mr President, ladies and gentlemen, the agreement on the Stability Pact has its positive aspects, but some major concerns remain. First of all, it is essential that the Commission should have a stronger and not a weaker role in managing the Pact, as regards both the accounts side and the investments side, that is to say as regards both stability and growth.

Secondly, it must be clearly understood that the new Pact is for growth, and for growth in the economy, not growth in deficits: the two things must not be linked together, as some national governments, such as the current Italian Government, seem to do. We therefore call on the European institutions to work to prevent dangerous renationalisations and to take decisive steps to boost the Community spirit. Otherwise, the very future of the Union will be in jeopardy if we do not maintain a Community approach in implementing both the Pact and the other main policies, primarily the vital Lisbon Strategy.

  Musacchio (GUE/NGL). – (IT) Mr President, ladies and gentlemen, on 19 March there was an enormous demonstration in Brussels by trade unions and the peace movement against the Bolkestein directive, against free trade and war, and for a social Europe.

Faced with the paradoxical situation in which we find ourselves, characterised by a strong currency, a weak economy and a society in crisis, faced with the crisis of the Maastricht framework and the Lisbon Strategy, in our view this demonstration – which brought together tens of thousands of workers from the whole of Europe, and I stress the whole of it, including the new countries in the east – put out a clear call for a much-needed change of direction. They did so despite the idea that some have of a two-tier Europe, that is to say one of internal dumping, the Europe of the Bolkestein directive. The demonstration showed instead that there is a need for a harmonisation of rights, levelled upwards, of course.

What is needed, then, is a Europe that rejects the Bolkestein directive – that ominous directive on working hours – and, from the left, is able to break down the cage of monetarist free trade and to revitalise – not reduce – quality investments, rights, development, work and environment: in other words, one that is able to turn itself into a social Europe, the only possible kind.

We want to try to put these aspirations into practice in this House through our proposals and help to bring into Parliament the strength of feeling that enlivened the streets of Brussels, to which this Parliament cannot fail to respond.

  Karas (PPE-DE). – (DE) Mr President, Mr President of the Commission, ladies and gentlemen, I really must say that we have become extremely modest when evaluating the results of meetings of Heads of State or Government. We would enjoy much greater confidence and more credibility among the citizens if the actions by the governments of the Member States were more consistently in line with the decisions taken. At the moment, we spend our time at summits correcting decisions instead of complying and pushing ahead with what has been agreed. The President-in-Office is probably the only person who even brings about joint resolutions at this stage. We are delighted about any type of agreement, because otherwise failure threatens.

Please, take a brief look back with me. For me the problem before us lies in the contradiction between the European Treaties and political action.

Take the Stability and Growth Pact: we beg for compliance, we deny any weakening, but infringements and margins for interpretation are increasing. Blocking measures are organised and the Commission is hampered in its ability to intervene and impose sanctions.

Croatia: we decide that negotiations with Croatia will begin on 17 March but we postpone the negotiation process, even though the conditions are being complied with.

Financial perspectives: we want agreement with the Luxembourg Presidency, but we receive no signals that anything has changed in the 1% stand towards the Commission proposal.

Bulgaria and Romania: a Commission progress report is available, clearly showing which points of the conditions have not yet been met, but there is a date for signing the Treaties. Parliament is being asked to give its assent, but at the same time Parliament's rights were ignored on Monday.

Lisbon: we want the internal market and hence also an internal market in services, but some of us are misleading the citizens, by reducing the services directive to the country of origin principle.

I appeal to all of us, but above all to the Member States: we must become more accountable again, we must win confidence in decisions and we must abide by the rules which we set ourselves. We need fewer corrections to what already exists; instead, we need more serious compliance with decisions by Heads of State or Government, the Treaties and directives.

(Applause)

  Rosati (PSE). – (PL) Mr President, ladies and gentlemen, at its latest meeting the European Council took a number of important decisions amending the provisions of the Stability and Growth Pact. I would like to express my support for those changes. True, these decisions do weaken some of the provisions of the Pact and reduce their restrictive nature, but this need not imply relaxing budgetary discipline in Member States. We are all aware that the Pact’s rules have been systematically infringed for quite some time. There is currently an excessive budget deficit in one third of Member States. This is a very depressing situation, and confidence in the whole Union is being undermined. Amendment of the Pact and in particular greater flexibility of the preventive elements will actually strengthen its disciplinary powers. It is far better to have less restrictive rules that are actually kept by all without exception than more restrictive rules that are disregarded and infringed.

I also welcome the Council decisions on reinvigorating the Lisbon Strategy, and am pleased that these decisions take account of the findings of the High Level Group led by Wim Kok. It is essential to implement the reforms contained in the Lisbon Agenda at the earliest opportunity, if greater sustainable economic growth and more jobs are to be created and the European social model preserved. It should be remembered, however, that the main responsibility for implementation of the essential structural reforms now lies with the Member States. It is up to governments and parliaments in the individual countries to demonstrate political courage and vision. They must be able to convince the citizens that swift and effective implementation of the Lisbon Strategy is in their long-term interest. The European institutions can and must support the governments of Member States in this difficult process. The Commission needs to strengthen its role as an effective enforcer of Council decisions, and it must monitor the progress of reforms in individual countries in a transparent manner. There should be ongoing cooperation between the European Parliament and the national parliaments of Member States.

Mr President, I propose setting up a standing forum where representatives of the European Parliament and the national parliaments could hold regular and well-focused meetings to discuss the challenges involved in implementing the Lisbon Strategy. This will foster an increased sense of responsibility for the implementation of the Strategy at parliamentary level and strengthen awareness of its importance for European societies.

  In 't Veld (ALDE). – (NL) I do not think we have any reason whatever to take satisfaction in this summit, which was a shameful spectacle characterised by political horse-trading, and those self-same politicians are now shedding crocodile tears about the public’s cynicism. I see it as dealing another blow to the EU’s credibility.

This summit should have prepared the European economy for the 21st century and should have brought in greater budgetary discipline and a free market in services, but instead we are stuck with the old formula of debts and protectionism. To call this social policy is a disgrace. Some say that the Stability Pact has been rescued, but to my mind, there has been nothing but demagogy in the vague formulations, get-out clauses and accounting tricks, not to mention the way in which the political leaders treat the services directive. The new Member States do not suffer our complacency, but are far more dynamic and carry out reforms, and I would like to take them as an example to follow.

Finally, Mr President, I hope that following the various referendums and elections, long-term vision, courage, a sense of responsibility and political leadership can finally prevail once again.

  Montoro Romero (PPE-DE). – (ES) Mr President, the European economy is in a very delicate situation. The recent European Summit coincides with a downwards review of the European Commission's economic growth forecasts and, therefore, with a review not just of growth, but also of job creation.

What we are being told is that, in the Europe of 2005, the unemployment rate is going to rise and there is going to be economic stagnation. And that is negative and is what we must respond to by sending clear messages, messages of confidence for consumers and messages of confidence for investors. The European economy's problem is a lack of confidence, which stems from economic policies which are not able to inspire that confidence.

The Lisbon agenda, the Stability Pact and the liberalisation of services are key elements in terms of increasing this confidence. And we have missed an opportunity in March. We have missed the opportunity to promote healthy public finances and there are examples of this within Europe. The countries which have made an effort to rationalise their budgets are the countries which are growing and creating employment in Europe. The countries that have made the structural reforms contained in the Lisbon agenda are actually the countries which are growing and which are creating employment within the European Union.

We cannot talk about the European social model without looking at those countries and we cannot express self-satisfaction when what has been carried out is a review of the Stability Pact based on the political interests of large countries which are not growing and which are not creating employment, and when doubts are being raised about the very nature of the Stability Pact and when there is a lack of confidence in the economic reforms that the European Union requires.

This is the opportunity facing you, Mr Barroso, if your project to provide Europe with the growth and employment we all want to see is to be viable.

IN THE CHAIR: MR FRIEDRICH
Vice-President

  Berès (PSE). – (FR) Mr President, Mr President-in-Office of the Council, this an issue that we have not yet raised, but I believe that the conditions in which you have had to negotiate within the Eurogroup and then within Ecofin demonstrate that there may be a problem with the coordination of the powers of the two bodies. You have also mentioned the 3% and the 60%, indicating that they had not been changed. You are right. You would have had difficulty changing them, since these two figures are laid down in a protocol annexed to the Treaties which is taken up in a protocol annexed to the Constitution.

I would like to return to the essential elements of this reform. The first points, which I believe we have not discussed sufficiently, are the points that allow us to move ahead in terms of harmonising the bases on which each Member State will draw up its budget in the future, identifying the macroeconomic perspectives to be taken into account and improving the statistical instruments for assessing the results of a particular Member State. The idea of involving national parliaments more seems to be fashionable at the moment. Nevertheless, I believe that, with regard to the competences that essentially remain with the Member States, this is the best approach, and it in this spirit that, on 25 April, we will hold a debate in the European Parliament, with the national parliaments, on the challenges of economic policy in Europe and in the Member States.

When I look at the reality of this reform, there are disappointments. Each Member State has come with its demands, and we have seen, as we often do, a kind of trading in which everybody has taken the credit, without at the end of the day achieving European added value or the real prospect of a tool for growth and employment. We have more work to do in this regard. I know that you share this concern, that is to say that, in the future, genuine coordination of economic policies should allow us finally to gain all the possible advantages from the introduction of the euro.

Finally – if you will allow me, Mr President – with regard to structural reforms, and hence pensions, they are, unfortunately, fundamentally the great winners from this reform, since, whether in the preventive stage or in the evaluation of deficits, they will have to be taken into account. I remember what you said to us in the Committee on Economic and Monetary Affairs. You did not seem necessarily to share the view that a reform of pensions should be guided by accounting principles.

  Matsakis (ALDE). – Mr President, stability and growth depend on a healthy economy. The EU’s economy is suffering daily, sometimes to the tune of millions of euro, due to the embargo imposed by Turkey on EU shipping. This embargo was intended in theory to be against Cyprus, but in practice it is against the whole of the EU. I shall explain why with the following example. A German-owned ship with a French flag carrying British goods for a Spanish company will be prevented from entering a Turkish port if it is discovered that a member of the board of the goods handling company previously had a business connection with a Cypriot company. This is illegal and absurd and there is no excuse for the Council and the Commission to tolerate such aggressive behaviour by a candidate country for one day longer.

I would like briefly to raise another issue. Two days ago, Hurriyet, a daily newspaper with a large circulation and the mouthpiece of the Turkish Government, reported that the Council and the Commission had been working together on what sounds like a conspiracy to essentially isolate and destabilise the Cypriot Government in order to force it to accept an unpopular solution to the Cyprus issue. I know that this report is nonsense, but it has been misused for the purposes of Turkish propaganda and has caused my constituents concern. I urge you to state here today that it is utterly false and farcical.

  Langen (PPE-DE). – (DE) Mr President, Mr President-in-Office of the Council, Mr President of the Commission, the Stability and Growth Pact has been much praised. However, I am convinced that it was a very difficult birth and that the outcome is anything but satisfactory. I do not mean to detract from the achievement of Mr Juncker and Mr Barroso in reconciling national egotisms, but what has emerged is a medium-term nail in the coffin of the stability of the euro. We do not notice this now, because at the moment the USA and Japan are much deeper in debt. However, as soon as their debts are reduced, the stability and exchange rate of the euro will be called into question. Of course the 3% and 60% criteria have been maintained. However, there is no longer even any discussion of the fact that the resolutions of the Stability and Growth Pact state that efforts should be made to balance the budget. The very first test, when it came to the two large states of France and Germany, went wrong. If you fail to keep to a pact in difficult times, what justification is there for doing so in good times? I do not see this as a realistic concept. The difference between 0% and 3% alone makes EUR 250 billion in the eurozone. That is money which could have been used for short-term economic cycles, for natural disasters or for international obligations. By the time things had gone that far, it had all gone.

That is why I believe that even the reference to the European Central Bank is insufficient, because, although the European Central Bank is independent, it is a subsidiary of the national banks. The European Central Bank has a governing council, but two-thirds of it is dominated by the governors of the national central banks. As long as the European Central Bank is not in a position to orientate its own refinancing business on whether government bonds in the eurozone have a good or a bad rating, it will be unable to help the euro achieve the necessary stability in the long term.

  Andersson (PSE). – (SV) Mr President, I welcome the outcome of the spring European Council. Allow me to point out four things. Firstly, the Lisbon process is balanced, which also means that the pillars are interdependent. Secondly, a lot of emphasis is placed on the European social model, which means not only more jobs but also high-quality jobs, social security systems that are secure and that need to be modernised and the reconciliation of working life and family life. Thirdly, I welcome what is said about the Services Directive. I believe that there is a growing consensus on it between the Council and, as I believe, the majority of this Parliament. We need a Services Directive, but it must not look like the existing proposal. We need to be able to retain the European social model. We need to be able to have high environmental requirements and robust consumer rights. I believe it is possible to devise such a proposal. Fourthly, sustainable development is a mainstreaming issue. Ecologically sustainable development is at issue, but so too – and to just as great a degree – is economically and socially sustainable development.

Allow me finally to say that not everything is, of course, just negative. It is too easy to be pessimistic. We have not fully complied with the Lisbon process, but there are nonetheless a number of countries that have fulfilled many of its requirements. I shall not name those countries that have successfully met the requirements, but a glance at those countries reveals that they have combined growth, high employment, strong social systems and stringent environmental requirements. We have every reason to be optimistic about the future.

  Malmström (ALDE). – (SV) Mr President, unfortunately, I have to say that the European Council was a unique display of bad leadership. At a time when the European economy is in real need of reform, when unemployment is increasing – including in Sweden, Mr Andersson – and Euroscepticism is becoming more widespread, what does the Council do? Instead of standing up for Europe and publicly taking the lead, the EU’s leaders completely shy away from one of the most important issues in the Lisbon process, namely the Services Directive.

Out of fear of various referendums, they give oxygen to the lies and myths cultivated by strong forces on the left in connection with this directive. There will, it is maintained, be no end to all the misery that will be suffered by European consumers and employees if the Services Directive goes through. Nonetheless, the Council and the Commission know that this directive, which has nothing to do with the new Constitution, is incredibly important for European growth, jobs and consumers. Naturally, no one wants the Services Directive to lead to social dumping but, instead of standing up for the directive, which they themselves have ordered, they help foment a host of false perceptions, the result being increasing distrust. How are people to believe in Europe when not even we who work with Europe every day dare to do so?

(Applause)

  Kirkhope (PPE-DE). – Mr President, the March summit was supposed to be about relaunching the Lisbon Agenda. Sadly, I regret that it may well go down in history as somewhat a fudged affair. An apparent assault on liberal economics by the French President and others was not an edifying sight. Being quoted calling the liberalisation of Europe’s economies the new communism of our age, if true, was somewhat extraordinary. Any attempt to undermine our services directive is sadly a clear sign that the anti-reform forces in Europe remain active.

President Barroso said recently that some people think the European Commission is there to protect the old ‘15’ against the new ‘10’. It is not. He is absolutely right; the services directive is a fundamental building block of a successful, dynamic economy. Those who seek to undermine the progress of the internal market do no service to the millions of unemployed in their countries. On the contrary, as the new Member States have demonstrated so clearly, it is the liberalising economies that are the successful job-creating economies.

The so-called European social model has assumed such significance among some nations that it seems almost impossible to undertake proper reform. I am afraid that this new model, whatever merits it may have had in former times, is now something of an Achilles heel to our economy. It has perpetuated high unemployment – 19 million at the last count; it fostered anti-enterprise cultures; and every day that we remain unreformed the competitiveness of China, the United States and India increases, to our disadvantage.

As I have mentioned to Mr Barroso, I believe that he is very sincere in his drive to get the required reforms, but he has been badly let down by others; by heads of government, including our British Prime Minister, whose short-termism has made it much more difficult for Mr Barroso to make progress.

There are some good Council conclusions, such as on the Kyoto Protocol and sustainable development, but I am afraid that the heavy-handed tactics of some leaders, trying to put a brake on our economic reform and playing games with an increasingly discredited Stability and Growth Pact, serve as a timely reminder to us all that we could have our interests sacrificed to short-term political interests if we are not vigilant.

  Sacconi (PSE). – (IT) Mr President, ladies and gentlemen, our debates are often repetitive, and so I should like to start with a news item that I read yesterday which I found quite striking. A few days ago, in Huang-Kan-Tun in southern China, there was a popular uprising, which unfortunately also led to two deaths because of brutal repression by the police. It was an uprising by the whole population of that village against a recently established chemical plant, which in a short time had caused very severe air, water and soil pollution.

What do I mean by this news item? I mean that new environmental, ecological, health and social demands are now emerging in these new economic powers too, as a result of industrial growth. That clearly shows us our role in the future international division of labour: designing and selling technologies to enable those countries to grow without repeating our past mistakes, such as pollution and social oppression. In view of all that, I think the summit has had a positive outcome, because it has genuinely reinvigorated the Lisbon Strategy on the basis of the interdependence of the three pillars; it has revitalised the European Union’s global role as a leader in the field of sustainable development; and it has put forward a protocol for Kyoto 2 that is highly ambitious and important precisely in this context.

What I think is good above all is the political reform of the management of the Lisbon Strategy according to the principle that everyone must play their own part to the full – the Member States, the Community, local communities, the European Union, and so on. Parliament too must play its own part, as has been clearly stated. We shall do so better, Mr President, if, as you hoped, the collaboration that has been occurring recently among the institutions on the task that concerns us – drawing up advanced legislation – continues. I think that one of the main areas where this challenge will lie will be the REACH directive. I am sure that the desired collaboration will take place in the coming months in order to achieve this result.

  Sterckx (ALDE). – (NL) As chairman of this Parliament’s delegation for relations with the People’s Republic of China, I should like to say something to the President of the Council about lifting the arms embargo. I note that, even though you know that this is opposed by a large majority in this House, the Council remains intent on pressing ahead with it. I even have sympathy for the Chinese when they question this as a political gesture and say that, in a strategic partnership such as ours, there is no room for embargos of this kind. If, however, we want to make a political gesture, we must ask for one in return, and this we are not yet getting. Far from it; the Anti-Separation Law, which was adopted in China last month, sends the wrong message. Later on this month, a delegation from the Chinese People’s Congress will be explaining to this House what, precisely, was the intention behind this, and I shall be listening to their explanation with a great deal of interest. I also think that we should ask for a gesture in connection with individual human rights, because there has been too little evidence of improvement in this respect in China recently. So, Mr President-in-Office of the Council, if the Council wants to make a political gesture, I urge you to demand gestures in return from the Chinese Government. I hope that the Council will be prepared to adopt this line, which enjoys the support of a large majority in this House.

  Saryusz-Wolski (PPE-DE). – (PL) Mr President, the outcome of the Spring Summit suggests that the European Union has unfortunately taken a step backwards. It is becoming ever harder to attain legitimate economic objectives. The goalposts seem to be moving further away. Relaxation of the principles governing the Stability and Growth Pact is very worrying. Introducing something akin to manual control, and applying the Pact’s principles only to certain countries and not to others that infringe its principles as a matter of course, is a short-sighted approach. What kind of message does this send to those Member States that decided to undertake painful reforms in order to achieve financial discipline and meet the convergence criteria? What kind of example is this setting the new Member States?

Regrettably, the Lisbon Strategy statements remain on paper. The Member States and the Union as a whole must transcend rhetoric and support those fine declarations with specific and consistent actions. It is impossible not to agree with the Presidency Conclusions, namely that completion of the single market as far as the free movement of services is concerned will support Community objectives regarding economic growth, employment and competitiveness. The services directive is one of the best parts of the Lisbon Strategy. Consistent action aimed at bringing about the single market is the best way of supporting the Lisbon Strategy. All these objectives will be attained faster and more effectively if the services directive currently under discussion is not diluted, weakened and postponed, departing from its original form. We must ensure free and unrestricted provision of services throughout the entire territory of the Union. As we work on this directive, we must make sure that it contains as much common sense and as few restrictions as possible.

The Union needs powerful economic catalysts if it is to attain its economic objectives. One such catalyst was the accession of ten new Member States in the enlargement that took place last May. We are now called upon to go further. We must serve the interests of future generations, and not think only of contemporary political wheeling and dealing, elections and referendums. The citizens of the Member States expect us to do our duty. Fine words will not transform or magic away contemporary reality, characterised by the lack of a will to change, to open up markets and also by a weakening of macroeconomic discipline. We must find the courage to face up to the future.

  Van den Burg (PSE). – (NL) The advantage of speaking at the end of a debate is that it is possible to elaborate on a number of matters that have already been discussed, and I should like to do this by mentioning three misconceptions that have been dominating the debate. The first misconception concerns the reform of the Stability and Growth Pact. This was not just a matter of horse-trading among those Member States that struggled to meet the Pact’s standards; there was also discussion of economic policy and about what the Pact was meant to achieve in economic terms in the context of macro-economic policy. This may not have come across very well in the way the media covered it, but this was certainly something to which the Luxembourg Presidency gave its attention. I hope that the Commission, from this more macro-economic vantage point, will be able to use the Pact’s reform as an instrument for improved European macro-economic policy.

A second point concerns the integrated treatment of the economic guidelines and the employment guidelines, as well as micro-economic policy as presented yesterday by the Commission. All this does of course, fit into the framework of the Lisbon strategy, and my group argues that we should streamline these processes and opt for an integrated approach. We should, however, make sure we do not create a kind of hierarchy of procedures, so that no one particular Council formation, Commissioner, specialist committee, or integrated structure in this House, predominates. We do not want a super-Commissioner, a super-Council or a specialist committee concerned with nothing else.

A third point concerns the services directive. In this connection, I should like to stress once more that opposition to this is not about stopping the free movement of services and labour, but about the conditions under which such movement is supposed to take place. The Commission did not do its homework very well, and we must realise that the migration of labour is inextricably linked to the free movement of services and that, in this respect, much more should be done than has been done to date, quite apart from this services directive.

  Radwan (PPE-DE). – (DE) Mr President, Mr President of the Commission, Mr President-in-Office of the Council, it is done. We have had the summit, the Stability and Growth Pact was – as many are saying – reformed or – as others are saying – abolished, and an attack was launched on the services directive. Nothing more stands in the way of the prosperity and recovery of Europe. Now we shall manage it. That might be one message.

I am grateful to you, Mr President of the Commission, for having said at the beginning of your speech that the discussion about the Stability Pact had been started because the consensus about compliance with the rules hitherto had broken down and there was therefore no choice but to do something new. Then the question arose as to how to go about it. In the meantime, there was talk of liars. I, in any event, do not feel uncomfortable dancing to the tune of the European Central Bank and the German Bundesbank when evaluating the Stability and Growth Pact. If you then also bear in mind that many states have threatened, in connection with further growth, to stop applying the law which applied hitherto, then I wonder if this is how things are going to be now. Will we, in future, be taking decisions of this sort in Europe?

On the Lisbon Strategy, I should like to say that I hope for a strong Commission. I am aware of the fact, Mr President of the Commission, that it is harder for you than it was for Jacques Delors to realise a vision, because Jacques Delors had different Heads of Government at his side. At that time, he had Mitterrand and Kohl, who actively supported European progress. It is important for the Commission to concentrate on what Europe can achieve and not to produce too much paper. For the Council, it is important that the Member States commit to what they themselves regularly agree on and do their homework, so that we too can attain the goal.

On the services directive, I have just one thing to say: we shall probably vote on Romania and Bulgaria this afternoon. To those who are up in arms against this directive in the Council, I should just like to say that we have problems with respect to freedom of services with the 10 states, because it was not included in the accession treaties. We should not repeat the same mistake now and take it out on others; on the contrary, freedom of services should be corrected in the Bulgaria and Romania concept in accordance with the will of those who are for it. Otherwise, we shall face the same problem.

  Bersani (PSE). – (IT) Mr President, ladies and gentlemen, the decisions made at the Spring Summit appear to be good, but we are aware that they will only be judged by events. There are some great opportunities and also some risks in what we decide. Overall, we are allocating new responsibilities to the political decision-making body, and we must try to make these responsibilities promote integration rather than dissociation.

Transposed directives and national reform programmes must consist not just of generalities but of genuinely focused and measurable choices. The flexibility of the Pact must be increasingly transparent and managed exclusively for purposes of growth, according to sound common criteria. In this respect, a sensitive case involving Italy has started, and I want to say that we call on the government, the Commission, the Council and Eurostat for each of them to carry out their work wisely, transparently and fairly, because the people of Italy are entitled to clarity and truth in respect of their public accounts, that is to say their own future.

With the decisions of the Spring Summit we shall no longer be in the situation we were in before: if we do not have more Europe, we shall have less. That is why it is so important to make decisions that can guarantee integration and hence the Commission’s role in the coordination of macroeconomic policies, the improvement of basic statistics, the involvement of national parliaments, the genuine integration of national and European planning instruments, the strength of the Union’s budget, investments in infrastructure and research, the European dimension, and so on. We shall have to work hard to achieve all that. For now, in any case, I offer my heartiest congratulations to the Luxembourg Presidency.

  Toubon (PPE-DE). – (FR) Mr President, ladies and gentlemen, I would like to begin by simply saying bravo to Mr Juncker, the President-in-Office of the Council, to Mr Barroso, the President of the Commission, and his colleagues, without forgetting the Heads of State or Government. Thanks to you, I believe that this Council of 22 and 23 March has been decisive in terms of moving Europe forward. In terms of its content and its form, it has probably been one of the best Councils I have experienced.

This Council has provided solutions to several issues which have been facing us for a long time. First of all, an intelligent reform of the Stability and Growth Pact. I believe that in politics, including European politics, intelligence is required. Secondly, improvements and new orientations to ensure that the legislation under way is balanced. I am thinking of the directive on services, of REACH. Thirdly, the environment, at a time when Kyoto is being implemented. And finally our relations with China and European effort in the field of research. On this subject, I would like in particular to stress the historic decision taken on the launch of ITER.

From this point of view, I hope that the European Union will not have to wait too long for the good will of Japan; that we negotiate with the Japanese, provided, Mr President, that the draft is launched on 14 July, because this is an essential issue, essential for Europe, for the future of energy and for young people, that is to say for those people who will be living here in 30 or 50 years’ time.

This is why I fully support the joint resolution that expresses Parliament’s positive view of this extremely important and extremely positive Council.

  Myller (PSE). – (FI) Mr President, the good news about the Spring Summit was that a decision was taken to draw up a long-term strategy to reduce greenhouse emissions. A decision was also taken to consider setting binding targets for the mid- and long-term. It is absolutely essential that steps should now be taken to make ambitious proposals for the time after 2012.

Unfortunately, recent history has shown that it has been considerably easier for the European Union to draw up and agree ambitious targets than it has been to implement them. If we seek a new, successful start to the Lisbon Strategy, we should look for new leadership in the European Union in all areas of policy. We need to consider the interests of the Community, commit to the agreed decisions, and act in such a way that all the Member States derive added value from European cooperation.

  Oomen-Ruijten (PPE-DE). – (NL) Mr President-in-Office of the Council, Mr President of the Commission, you have both devoted the lion’s share of your speeches to the Lisbon process. The President of the Council did this in broad strokes and with the emphasis on balance and economic growth, which cannot be achieved without environmental and social responsibility. You illustrated this trinity, Mr President of the Council, by the integrated approach to which the Council conclusions also bear witness. I would also like to express my appreciation for the attention you gave to SMEs. I have never before seen Council conclusions in which the words SME, innovation and the environment featured so often. In the resolution on which this House will be voting today, we demand new dynamism in the Lisbon process, new dynamism with a ‘focused approach which shows new leadership’.

Mr President of the Commission, I would now like to turn to you. This leadership and dynamism can be achieved only if you operate in tandem with the Member States, the regions and the social partners. In this morning’s speech, I did not get the feeling that this mano in mano, as the President of the Council put it, is all that evident. I may be wrong, but I get the impression that an awful lot of paperwork is being inflicted on the Member States, and that less attention is being paid to the social policy agenda and that it is not being given teeth. I also have the feeling that this mano in mano with Parliament leaves something to be desired as regards integrated employment policies, in which area I would like to see a certain degree of consultation in future.

  Hatzidakis (PPE-DE). – (EL) Mr President, the Luxembourg Presidency is, I believe, a good presidency, which already counts among its achievements the creative compromise on the Stability Pact, which allows the Member States in the eurozone to move forward on the basis of the rules of financial prudence but with the necessary degree of flexibility.

At the same time, the Luxembourg Presidency managed during the European Council in Brussels to make the Lisbon Strategy more specific, but it really is a pity that it was not possible to name at this point the Member States which are not managing to promote this strategy.

Another major issue which we have before us within the framework of the Lisbon Strategy is the services directive, which I hope will be examined in a rational manner and, more importantly, will endeavour to clear up the misunderstandings, so that the fog on the horizon which is preventing us from seeing the substance of the issue will lift, as the impression is sometimes created that we are talking throughout the European Union about a different matter entirely.

Finally, I would like to wish the Luxembourg Presidency success henceforth with a very major issue which we are dealing with, by which I mean the financial perspectives, especially the budget for the Union's regional policy, for its cohesion policies. This is a very major and difficult issue. I personally believe that we are all doomed to reach an agreement by June, because otherwise regional policy programmes will be the victims of any disagreement at European level.

  Sudre (PPE-DE). – (FR) Mr President, Mr President-in-Office of the Council, Mr President of the Commission, ladies and gentlemen, the last European Council gave the European economy a new direction, that is, the direction of pragmatism, flexibility and encouragement of innovation.

With regard to the Stability and Growth Pact, I am delighted that realism and flexibility have taken over from dogma and blind respect for rules which were decided upon during a period of economic growth that was much more sustained than the one we are experiencing today. Rules are necessary, of course, since the stability of our common currency depends on them, but the reform of the pact is positive in that it reconciles the fundamental principle of respect for the rule of law and the minimum flexibility required for the management of the Member States’ public funds. I would like to thank President Barroso and President-in-Office Juncker for their clear-sightedness and their powers of persuasion on this thorny issue.

This pragmatism has also been applied to the draft directive on the liberalisation of the European services market. By recognising that the current wording of the directive does not fully respond to the requirements and by calling for every possible effort to be made in order to make the internal market in services fully operational while preserving the European social model, the Council has not – as the media have too often said – pleased France. Rather, it has recognised that the country of origin principle raised clear problems in terms of the risks of social and fiscal dumping and has left it to the wisdom of the European Parliament to find an acceptable solution. That is the kind of attitude the citizens expect from Brussels.

The future of our economy will be in jeopardy if we do not make an increased and huge effort in terms of investment in the field of education and training and in the field of research and development. We are way behind our American and Asian partners in these two areas. The 25 have confirmed their will to make the Union a more attractive area for investment and job creation, in order to promote knowledge and innovation and to sustain growth. These ambitious and necessary objectives will be achievable provided that our States provide the political will and the necessary funding.

  Posselt (PPE-DE). – (DE) Mr President, the Council's enlargement strategy is wide of the mark. There is discrimination against Croatia, a central European country which meets the criteria better than many a Member State. Romania, a manifestly European country, but one which fails to meet the criteria by a long chalk, is being rushed through, as it were. Ukraine, certainly a European country, but one which will not be ready to accede for decades and which we too shall not be ready to accept within the next few years, has been put off until heaven knows when; no specific strategy is being developed. Yet with a clearly non-European country such as Turkey, accession negotiations are to commence this year.

I really must call on the Council to rethink this strategy thoroughly and to ensure first of all that the green light is given for accession negotiations with Croatia without delay – by 21 May at the latest – and that the working party generously set up as a result of your intervention, Mr President-in-Office, reaches a result without delay. Secondly, I should like to call on you to indeed allow Romania and Bulgaria to accede by the deadline set, but to give us the chance to wait until the autumn, until the corresponding progress reports are available. Thirdly, I should like to call on you, once Romania, Bulgaria and Croatia have joined, to grant the EU a long breathing space for the internal consolidation it so urgently needs.

Furthermore, I should like to call on you to prevent accession negotiations with Turkey, which will overtax and overstretch the EU, from commencing in the autumn, and to develop a good neighbourhood strategy here and also to develop a concept for Ukraine. Otherwise, what came out of the Orange Revolution will also fail, and that would have serious repercussions for Europe.

(Applause)

  Juncker, President-in-Office of the Council. (FR) Mr President, at the end of this debate, which has largely been very disorganised, I would like to clarify certain points.

I am pleased that, with regard to the decisions of the European Council on the Lisbon Strategy, there has been very little controversy. That seems to me entirely normal, coherent and logical, since and some people would do very well to read it the European Parliament's resolution that has been adopted on the Lisbon Strategy has been almost entirely reflected in the European Council's conclusions. The fact that certain elements are being criticised today would suggest that you are taking a highly self-critical approach. That is my observation!

Furthermore, I believe that it is essential that we at least give the European Council's decision on the Lisbon Strategy credit for having placed great responsibility on the shoulders of the Member States. We were in considerable agreement in January when we debated the issue, stating that it falls to the national governments to make a success of the Lisbon Strategy not just for each of their countries but for Europe as a whole.

From now on, the national governments will have to consult their national parliaments on their national reform programmes, the Council will be answerable to the European Parliament, and the Commission will play the role it has always had, that is to say the role of facilitator and initiator, a role that consists of uniting all the Member States in a spirit conducive to achieving the objectives of the Lisbon Strategy, which has been designed to ensure that, in the future, the European social model remains accessible to the greatest possible number of Europeans.

I would note that, within certain groups that are rather more ecumenical than catholic, there are entirely divergent views on the essential elements of the form political action should take at European level. It is easier, Mr Radwan, to reach a compromise on the Stability and Growth Pact than to achieve coherence within the group to which you belong. I have witnessed this today and yesterday.

(DE) On the Stability Pact, I should like to say that I am most surprised that all the interim stages of the reform of the Stability Pact have been accompanied by the same ferocious rhetoric and commentary on it. When a number of governments suggested that entire expenditure blocks should be written out of the Stability Pact, the criticism sounded exactly as it sounds now, now that it has not come to pass. Something must be wrong. The preventive part of the pact has been substantially strengthened. Why was this necessary? It was necessary because this aspect was simply – and quite criminally – neglected by the old pact – with the gestation of which I had a great deal to do. A number of governments also failed in so-called good times to follow the right policy for reducing deficits and debt. That may of course take a turn for the better following a number of forthcoming elections, although I seriously doubt it.

The corrective part of the pact has only undergone minor changes, compared with what the Treaty and the Stability Pact say on the matter. Of course, if you imagined that, for the purpose of the pact, 3.0% really meant 3.0%, that proceedings would be instituted against countries with a deficit of over 3.0% and that these countries would be subject to sanctions if they did not get below the 3.0% limit the following year, then the reform of the Stability Pact does not come up to expectations. That would have required considerable amendments to the Treaty and, as a result, we would no longer have been able to use the old Stability Pact as a guide in important areas.

The Treaty does not say that any deficit over 3.0% is an excessive deficit. Anyone who says so is misinterpreting the Treaty. It simply does not say that in the Treaty and I cannot accept that we should act as if it did and that those who are again finding their way back to a correct interpretation of the Treaty are now being treated like stability sinners. How can one take it upon oneself to claim sole responsibility for interpreting the Treaty and the Stability Pact? I read – and it even amuses me somewhat – that the Council, the 25 Ministers for Finance, the 25 Heads of State or Government, bowed down before Germany and France. This is completely ridiculous and, for the rest, offensive to the other twenty-three.

(Applause)

The idea that it only needs a peremptory shout from Berlin or a clear signal from Paris to make the other twenty-three governments knuckle under is a totally un-European perception and contradicts the constantly recurrent need to achieve a viable working relationship in Europe and find compromise solutions. I do not want to have to ask myself how serious the criticism here in this House would have been, had we failed with Lisbon, had we failed to achieve the balances of which your House reminds us or had we failed totally with the reform of the Stability Pact. Some take the view that the old Stability Pact was so good that it did not need to be changed. However, this view is shared by not one government of the 25 Member States. The idea that the 25 Heads of State or Government and the 25 Ministers for Finance have put themselves on course for deficit and spiralling debt is a perfectly bizarre idea which I should like to vigorously contradict.

(Applause)

(FR) Apart from that, Mr President, a lot has been said about the credibility of Europe. I believe that it is sometimes very much under threat and I have not entirely understood Mr Watson’s point. I was not sure whether he was addressing me or addressing a group of Member States. I hope you are not reproaching me for not having persuaded the Members of the Group of the European People’s Party (Christian Democrats) and European Democrats to take the same position on all the issues, because I do not represent the PPE-DE here. I represent the European Council.

To those people who have drawn everybody’s attention to Europe’s lack of credibility, I will say this: I would like very warmly to thank the Members who have been attending this debate since 9 a.m. this morning. The visitors to the European Parliament today have been surprised not to see more people at a time when Europe is debating some essential issues.

(Applause)

  President. Thank you, Mr President-in-Office of the Council. I hope – or should I say I expect – that the criticism has been taken on board.

  Barroso, President of the Commission. (FR) Mr President, I shall conclude very briefly. With regard to the reform of the Stability and Growth Pact, we must genuinely acknowledge – if we want to have an honest debate – that the problems did not begin with this reform, but that they have existed for some considerable time. In November 2003, there was no longer any consensus on the Stability and Growth Pact. What we have just produced, what the Member States have just produced with the active support of the Presidency and the European Commission, is a credible reform of the Pact.

I can offer you every guarantee – and I address this in particular to those people who have expressed concerns, which are legitimate concerns – that the Commission intends to apply these Stability and Growth Pact rules objectively and in a uniform manner amongst all the Member States. I can also assure you that the Commission’s role has not been diminished by this reform, quite the contrary. In fact, the range of situations in which the Commission will be required to give its opinion or to take the initiative on an action has been considerably extended. We therefore now have a pact that it will be possible to apply much more credibly than the one we had before this reform.

Furthermore, with regard to Lisbon – and I have seen this during this morning’s discussion – there is clearly a very broad consensus on a system to enhance governance, in which there is a better distinction between the competences of the Union and the competences of the Member States. The Member States have accepted this enhanced governance and, once again, this also increases the credibility of our Lisbon objectives.

I would like, however, to return to an important point from the conclusions of the European Council that I did not mention in my introduction to this debate: the development policy within the context of the Millennium Development Objectives. At its last meeting, the European Council asked the Commission to speed up its work on finalising the Union’s positions with a view to the important meetings within the United Nations next September.

I am pleased to announce that yesterday, right here in Strasbourg, the Commission adopted an important package of proposals, which Commissioner Michel and myself also announced yesterday. It contains new mid-term objectives, more emphasis on the quality of aid and greater coherence amongst policies. In this ‘development’ package, particular emphasis is also placed on Sub-Saharan Africa. Ladies and gentlemen, the Commission treats these proposals as a great priority. We are currently working actively with the Member States to make this meeting relating to the Millennium Objectives a success, and we are very much counting on your support.

Another reason why I have given this example, Mr President, is to illustrate a point that I believe to be important. That is that we are truly working on operational decisions. Within the European Council, we have established the objectives and the new instruments for the renewed Lisbon Strategy and we have also just approved the integrated guidelines, encompassing macroeconomic policy, microeconomic policy and employment. We have just presented them here in the European Parliament. The European Council has drawn up a request relating to development, and we are presenting concrete proposals.

I am well aware that, at the difficult times we are currently experiencing in Europe, our attention is often more focussed on controversial aspects, on the things on which there is no agreement from the Member States or unanimity amongst them. I would like to stress, however, that, despite these differences and despite, at times, our divergences, we are able to reach very significant consensus, as was the case at the Spring Council.

I would therefore like to underline what the President-in-Office of the Council has just said. How would you react if we had not come here with results that, despite everything, reflect a consensus, and what message would we be sending to our public? This is why, at this stage, while I share many of the worries and concerns expressed by some of you, the question is whether we should place the emphasis on aspects on which there is no complete consensus or whether, on the other hand, we should place the emphasis on the things we can do together.

Because that is the culture of compromise we have in Europe, and I would like to place great emphasis on this point. We will not make any progress in a Europe of 25 if we do not explain to our citizens that, in Europe, no one can achieve 100% of what they want. No Member State can achieve 100% on all of its positions. Our Europe is becoming increasingly complex. So it is up to those of us who have a leading, and indeed political, role in the Council, the Commission and the European Parliament to explain to our fellow citizens that we have to make compromises, that Europe means compromise. Europe means working together towards objectives that are much more important than short-term issues or national sensitivities.

That is what responsibility means, and responsibility is the most important thing if leadership is to be effective, and leadership is what Europe needs at this stage.

(Applause)

  President. Thank you, Mr President-in-Office of the Council and Mr President of the Commission. Six motions to wind up the debate have been received in accordance with Rule 103 of the Rules of Procedure.

The debate is closed.

The vote will take place at 12 noon.

(The sitting was suspended for a few minutes.)

WRITTEN STATEMENT (RULE 142)

  Guerreiro (GUE/NGL), in writing. – (PT) To its dismay, the European Council of 22 and 23 March was characterised by an issue that was not on its agenda but which was imposed upon it.

Recent polls showing a possible victory for the ‘no’ vote in the referendum in France on 29 May on the so-called ‘European Constitution’ have set the alarm bells ringing.

The Right and the Social Democrats have teamed up and have got down to work, encouraging almost open interference in the campaign taking place in France.

Parliament is spending EUR 8 million on the ‘yes’ campaign, and this is unacceptable.

Heads of State or Government, and anyone who feels they can have an influence on the outcome of the referendum, are queuing up to attempt to convince the French people of the ‘advantages’ – hypothetical and non-existent as they are – of the so-called ‘European Constitution’.

The major employers and union leaders that are dominated by Social Democrats and the Right – spearheaded by the European Trade Union Confederation – are all pulling out the stops to endorse this project, which damages people’s sovereignty and encourages neoliberal capitalism and militarism.

The Commission and Parliament are putting off taking decisions in a bid to avoid providing more and more valid arguments to vote ‘no’.

Despite the contradictions, a ‘no’ vote in France will be the best answer.

IN THE CHAIR: MR BORRELL FONTELLES
President