Bolkestein's Monster


November 6, 2006 14:43 | by Steve McGiffen

Steve McGiffen reports on the return of the Bolkenstein directive - coming soon to a parliament near you.

THE Bolkestein directive is back. The measure, which threatens to throw essential services in every European Union member state to the wolves of the market, has been sent back to the European Parliament for re-examination.

Last February, following an impressive mass mobilisation of trade unions across the continent, MEPs agreed to remove the directive's worst excesses, reducing its scope by exempting social housing provision and some aspects of health care. Explicit reference to the notorious country of origin principle was removed, though critics said that the ambiguity of the remaining text would allow the European Court of Justice effectively to restore it.

Most parties in the so-called Socialist group supported this compromise, though progressive MEPs organised in the United Left Group (GUE/NGL) voted against. No matter, as GUE/NGL leader Francis Wurtz said when the reply to the parliament's amendments arrived from the Council of Ministers and the European Commission, what these two bodies were saying, in so many words, was "you can amend whatever you like, as we won't take a scrap of notice."

The Council of Ministers, consisting of the employment ministers of each of the 25 member states, at first promised to respect the parliament's amendments. When the council's official response arrived, it had in effect restored the original proposal, so restricting the parliament's exemptions - designed to protect services of general interest - that the text was even criticised by Austria's right-wing employment minister. Austria's being the current holder of the rotating EU presidency should at least have given it the power to delay the passage of the council's revised text, but apparently the minister's reservations were insufficient to block an agreement.

Many Members of the European Parliament are up in arms about this flouting of any semblance of democracy. Wurtz has attacked the council text for "introducing a series of alarming ambiguities, both on public services and consumer protection," adding that it has also "given the European Commission an outrageous right of scrutiny over national legislation." In other words, any law seen to be in violation of complete freedom of establishment of and trade in services will be declared null and void by an unelected bureaucracy now exclusively composed of fanatical neoliberals.

The Parliament will make a further attempt to water down the text, which must now go through its second reading, in the near future. Even if it succeeds, however, the results will be no better than the compromise rejected by the left in February. Parliament rules mean that only amendments carried at first reading but then rejected by the council may be presented at second reading.

Moreover, however extreme the final measure, you can be sure that most national parliaments will nod it through. And extreme it is, representing nothing less than a declaration of war on the labour rights, working conditions and social provisions won by workers in most western European countries over the last century or more.

The latest text returns to an approach which treats all services as equal, ignoring their actual importance to the public interest. Competition rules and access to national markets for foreign firms takes precedence over all other interests.

Demands that no single European market in services should be considered until a directive is in place exempting services of general interest have been ignored, despite the fact that it is now almost a decade since the European Commission first promised to introduce such a measure.

The text also hugely restricts the degree to which member states can regulate service activities within their national borders. The county of origin principle will allow a firm registered in a country with very low standards of labour protection or very lax environmental legislation to conduct activities in, for example, Britain. France or the Netherlands with no regard for national law. Provided that it complies with the law in the country in which it was registered, it would be operating entirely legally.

Even if standards in its country of registration were acceptable, inspectors from the host country would have no right to enforce them. The idea that Lithuania or Cyprus is going to send an inspector to ensure that a firm operating in Belfast or Copenhagen, Stockholm or Munich is following the rules is, of course, laughable.

Whether a single market in services is desirable at all is highly debatable. However, if companies are going to operate abroad, then they should surely follow national laws and regulations.

The adoption of minimum standards to apply throughout the EU would seem, moreover, to be an essential corollary of any attempt to encourage cross-border competition. Yet the draft directive excludes any possibility of such standards being introduced.

As is generally the case, we are going to have to rely on ourselves if we are to win this vital battle. The Directive on Services in the European community is an attack on all working people in every EU member state.

Neither the European Parliament, national parliaments nor member state governments are going to stop it. It is vital that workers across the EU participate in the mass mobilisations which, presuming the directive becomes law, will greet any attempt to implement it.

Steve McGiffen is editor of Spectrezine and author of The European Union: A Critical Guide, which is published by Pluto

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