Bolkenstein's monster must be destroyed

The EU Services Directive will create a neo-liberal nightmare if it is introduced after the EU parlimentary vote this month and must be rigorously opposed, writes Eoin O Broin

FRITZ BOLKENSTEIN, former EU commissioner for the internal market launched the Services Directive in 2004. The aim of the directive was to liberalise and harmonise the regulations governing the service sector across all 25-member states.

Former Irish finance minister and rabid Thatcherite Charlie McCreevey took over from Bolkenstein following the European elections of the same year and since then has been actively promoting the directive across the EU.

Apart from the proposed EU Constitution, the Services Directive has been the single most contentious and controversial to come from the Commission in recent years. The fact that a final decision still has not been taken, almost two years after it was first published is an indication of its divisiveness.

Following lengthy discussion at committee level in the European parliament, the report - and more than 500 amendments - will come before the parliament in Strasbourg in February. If passed it will have a profound impact on the lives of workers and consumers across the European Union.

The directive states that all "services that correspond to economic activity and are open to competition" are covered by the directive. This broad definition includes many public services, and in doing so denies member states the possibility of defining which public services it should retain responsibility for. For example, the Directive could turn people relying on social services into consumers of services being provided for a profit, ignoring peoples rights and welfare. Member states will not even be entitled to supervise the provision of services. The directive also removes the safeguards needed to protect the rights of workers and consumers and states that "rules laid down by collective agreements shall not be seen as requirements..." undermining many member states' voluntary system of collective bargaining.

The most controversial element of the Directive is the "Country of Origin Principle", which means that workers will be subject to the laws and regulations of the home state of their employer, not the state in which theyare actually working. Service providers could establish themselves in the state with the lowest employment, health and environmental standards and operate anywhere in the EU under these lower standards. This would create unfair competition between service providers, and newforms of discrimination that would endanger employment in the services sector. It would provoke a "race to the bottom" between EU member states in terms of pay and employment conditions.

Unscrupulous companies will use the Country of Origin Principle to drive down wages and standards. They will tell us that globalisation and the need to remain competitive demands such action. The reality, however, is very different. Wage levels, workers protections, and health and safety standards will be sacrificed in order to increase companies profit levels, irrespective of the social or economic costs.

There is no doubt that this element of the Directive has created a great degree of concern across a wide range of public opinion. Because of this some MEPs are now calling it the "freedom to provide services" in the vain hope that a cosmetic change in the text will fool people thatthe substance of the proposal is also being changed. Such a cosmetic changein no way affects the impact of the proposal.

Despite these concerns the European Commission has not undertaken any social impact assessment of the Directive. Indeed, commissioner McCreevey has made clear thateven if the Directive is rejected by parliament a new proposal will have to be redrawn because "something has to be done with the services sector". The clear inference is that if people don't like this Directive we will go away and draft the same ideas in another form and keep doing so until we get our way.

A growing coalition of forces has been opposing the Directive. In the European parliament the United European Left/Nordic Green Left group which includes Sinn Féin are rejecting the proposal outright. Other progressive MEPs in the Socialist and Green/European Free Alliance groups have taken a similar position. The Party of European Socialists, including the Irish Labour party, have amore ambiguous position, opposing the Country of Origin Principle, but supporting other neo-liberal elements of the Directive.

However, even within the Christian Democrat EPP group there is considerable unease with the proposals.

The potential outcome of the parliamentary vote is unclear at this stage, however what is certain is that following February's vote in Strasbourg, the Council of Ministers, including Bertie Ahern and Tony Blair, will determine the future of the Directive. Lobbying your MEPs is crucial, but more importantly we need to influence our governments. In particular trade unions should be demanding to know what government intends to do on the Directive at the Council of Ministers.

In Ireland, as a new round of Social Partnership talks begin, SIPTU and other leading unions could make rejection of the Services Directive a condition of the talks. In Britain the TUC and its constituent members, following the ETUC, should publicly demand that Blair reject the proposals, and initiate a short, sharp public campaign in order to ensure thatpublic pressure stops him from doing otherwise.

The Services Directive is the single biggest threat to workers rights, public services and consumer health and safety in decades. It mustbe stopped.

Eoin O Brion is a member of Sinn Fein's Ard Comhairle and the party's Director of European Affairs. His new book, Sinn Fein and the Republican Left, will be published later this year.