Select Committee on European Legislation Seventeenth Report


DEPARTMENT OF TRADE AND INDUSTRY

COHESION AND THE INFORMATION SOCIETY

13. We consider that the following raises questions of political importance. We do not recommend its further consideration, but suggest that it would be relevant to the debate we have recommended on (17766) 12614/96 on cohesion policy[32]:-


(17887) 5581/97 COM(97)7 Commission Communication: Cohesion and the Information Society.
Legal base: -

Background

    13.1  The Commission has recently adopted its first report on economic and social cohesion under Article 130b of the Treaty, which we have recommended for debate in European Standing Committee B. This Communication forms part of the follow-up to the report.

The Communication

    13.2  The Communication points out that the emerging "information society" offers huge opportunities. One of the objectives of the gradual liberalisation of telecommunications markets is to make these opportunities available throughout Europe so that all regions, citizens and firms are equally well-placed to compete. The Communication argues that:

        "The development of the information society needs to be complemented, where necessary, by policy action in order to close the existing gaps and ensure that the information society develops at the desired rate throughout the Union. This calls for the participation and co-ordination of regions, national governments and the European Institutions so as to avert a polarisation between 'information haves' and 'information have-nots' as the new technologies spread."

    13.3  To achieve this, the Commission suggests, will require targeted support for investment expenditure in less developed, peripheral and/or rural areas. At present, only about 2% of expenditure from the European Regional Development Fund (ERDF) and the European Social Fund (ESF) goes towards investment in the telecommunications sector. The Commission considers that, as well as making the necessary adaptations to the regulatory framework, Member States should

        "target investment on projects that optimise the contribution to cohesion and on areas where investment would not otherwise be forthcoming under market conditions."

      Member States are also recommended to promote education and training, which the Commission also intends to support.

The Government's view

    13.4  In his Explanatory Memorandum of 4 March, the Minister for Industry at the Department of Trade and Industry (Mr Knight) argues that extensive support for infrastructure should not be necessary, since "most such investment is viable in growing markets". He also suggests that the Communication understates the amount being spent from the ESF to support training. He continues:

        "The Government believes that telecommunications liberalisation across the European Union, and indeed beyond, will provide substantial benefits to all regions and citizens. It will foster cohesion, both in terms of lower costs, particularly for long distance and international calls, and in terms of the greater quality of services resulting from competition. The information society is already helping to boost opportunities in UK regions: for example in telephone based banking and insurance, freephone or low cost calls can now connect customers with well informed providers all over the UK. This has created new employment opportunities in many regions, and will continue to do so.

        "In terms of the European Structural Funds, the Government intends to continue to use Structural Funds money to support projects related to the broader information society, amongst others, when this contributes to the overall economic and employment aims of the Funds."

Conclusion

    13.5  This Communication is stronger on general exhortations than on specific suggestions as to how the Commission's laudable aims might be achieved. We do not think that it should be debated itself, but it would be relevant to the debate in European Standing Committee B on cohesion policy which is due to take place on 19 March.

32  (17766) 12614/96; see HC 36-xi (1996-97), paragraph 3 (29 January 1997). Back


 
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