FOREIGN AND COMMONWEALTH OFFICE UPDATE
TO FOREIGN AFFAIRS COMMITTEE REPORTS
THIRD REPORT: EU ENLARGEMENT
We believe that the CAP must be reformed,
though the Government should aim to ensure that any such reform
should enable sustainable and affordable enlargement to proceed.
Any reform which creates long-term discrimination between existing
and new Member States will be both unsustainable and unacceptable.
We support the Government in its efforts to secure substantial
reform of the CAP through the introduction of co-financing and
degressive direct-aid payments. (Paragraph 41)
41. The Financial Times of 2 March reported
Commissioner Fischler as saying that direct payments for farmers
in the new Member States should be phased in over five to seven
years. However, his reported remarks do not represent an official
Commission position. In June, the EU agreed a Common Position
on agriculture, which defers adopting a formal position on direct
payments until a later stage in the negotiations. The Government
is of the view that the main priority at this stage is to get
the negotiating process on agriculture underway and to begin to
tackle the vast amount of technical detail in this chapter (agriculture
comprises around 50 per cent, or 40,000 pages, of the acquis
42. The Government is willing to explore
all options for integrating new Member States into the CAP. The
Government agrees with the Committee's view, in its original report,
that the EU's objective should be to avoid long-term discrimination
between existing and new Member States. The Government believes
that EU payments to new Member States should serve to promote
agricultural restructuring, and is concerned that extending direct
payments in their current form could inflate land prices and hinder
structural reform. The Government also supports the progressive
reduction of direct payments to farmers in the existing Member
States. The terms of accession should be consistent with the Berlin
The Government must ensure that, at this
stage in its history, Northern Ireland should continue to receive
special dispensation in relation to the Peace Initiative and the
International Fund for Ireland. (Paragraph 50)
43. The Berlin European Council agreed a
package of support for Northern Ireland, including the continuation
of the programme for Peace and Reconciliation and an EU contribution
to the International Fund for Ireland.
44. "Peace I", the first phase
of the Peace and Reconciliation programme, worth £400 million,
will end in December 2001; its successor, "Peace II",
is worth £709 million from 2000 to 2004 (funded 75 per cent
from the EU and 25 per cent from the UK and Irish governments).
It has the same priorities as Peace I, and operates, as before,
in Northern Ireland and the six "border counties" in
Ireland. The Northern Ireland and Ireland Authorities jointly
are now finalising details of the Peace II Operational Programme
with the Commission and expect funding to come on stream early
next year. (There will be no hiatus in spending as money from
Peace I will continue to be disbursed in 2001.)
45. In 1999, the EU released a three-year
tranche of funding (£45 million) for the International Fund
for Ireland, whose aims are "to promote economic and social
advance; and, to encourage contact, dialogue and reconciliation
between unionists and nationalists throughout Ireland." This
brings the total received so far from the EU's International Fund
for Ireland to £229 million. Along with contributions from
other international donors (Australia, USA, Canada, New Zealand),
this money will be used to promote cross-community activity and
job creation. The International Fund Secretariat places its annual
reports in the Library of the House (most recently in March 2000).
The Committee believes that more should be
done to explain the implications and opportunities of EU enlargement,
and considers that the Government should put forward specific
proposals to improve public understanding and knowledge in the
United Kingdom and throughout the EU. (Paragraph 51)
46. Since the Committee's report, the Government
has significantly increased its bilateral activities to promote
the benefits of EU membership and enlargement, in the UK and in
Member States and candidate countries.
The measures include:
Increased Ministerial contacts with
EU and candidate counterparts.
The Prime Minister, the Foreign Secretary, Mr
Vaz and Mr Battle have all given keynote speeches on the EU and
enlargement in the last nine months. The number of contacts by
government ministers with their EU colleagues has grown rapidly:
there was one contact a day on average in 1999. Contacts with
candidate counterparts (where EU enlargement figured prominently)
have also increased in the past two years; these contacts receive
high profile coverage in local media.
New initiatives, including the Europe
Day in the FCO, and Mr Vaz's event for colleagues from the Visegrad
Four at Hanbury Manor. On 28-29 November, Mr Vaz will visit Prague
and Bratislava with a team of MINECOR colleagues, to demonstrate
UK support for enlargement.
Launching publications, including
DTI's "EU Enlargement and the Single Market: Opportunities
for Business" on 28 September 2000.
Active participation in conferences,
academic debate and research.
Work with the Commission
47. In May 2000, the Commission announced
that it had set aside £160m to promote enlargement in Member
States and candidate countries. There have been some delays in
establishing a strategy. But as a first step, the Government will
be co-operating with the Commission delegation in London to prepare
a poll to establish more information about levels of support for
enlargement in the UK.
Work with other Member States and Candidates
48. The Government has also established
a pattern of co-operation with selected Member States and candidates
to promote enlargement together. The first phase has consisted
of jointly signed articles in the press. In the next phase, we
plan to include joint seminars with Austria and the Netherlands
later this year and are discussing with a selection of EU partners
the possibility of joint visits by Ministers for Europe to candidate
We believe that the Government should consider
measures which would allow applicant states to have a more formal
role in consultations on future EU positions and policies at Ministerial
and official level. (Paragraph 63)
49. The Europe Agreements, Association Agreements
and Accession Partnerships provide the framework for the EU to
discuss with each candidate progress towards accession as well
as co-operation and international issues. In practice, this means
that EU Ministers meet their counterparts from the candidate countries
three to four times per year in EU+1 format, There are more frequent
meetings at senior official level.
50. The EU has received position papers
from each of the candidates on the current Inter-Governmental
Conference and the Presidency provides regular briefing on progress
of discussions to the candidate states. UK officials supplement
this with regular briefing for representatives of candidate embassies
in London. Candidate countries can also submit position papers
on current EU issues, as did Hungary, for instance, before the
Lisbon European Council earlier this year.
51. Under CFSP, candidate countries have
the opportunity to align themselves with EU Common Strategies,
Common Positions and Joint Actions. They are kept informed of
developments in CFSP by the regular political dialogue between
Member States and candidates and on a day to day basis keep up
to date through the Associates Communication Network. However,
this does not extend to consultation on individual positions.
Given the fast pace at which CFSP moves, it is not always possible
for the candidates to align themselves with Common Positions before
they are declared.
52. The French Presidency will convene two
meetings of the European Conference, bringing together Ministers
on 23 November and Heads of State and Government on 7 December.
The meetings are intended to provide a forum for the EU to discuss
institutional reform and wider questions about the future of Europe
with senior political representatives from the candidate countries.
53. Heads of Government, Ministers and officials
from the UK and Member States continue to discuss EU positions
and policies whenever they meet their opposite numbers and the
Chief Negotiators from the candidate countries. The Prime Minister
did so when he visited Warsaw on 5-6 October and so did the Foreign
Secretary when he visited Budapest and Prague on 25-26 July.
The Committee supports the view that enlargement
must not involve a differentiation between different classes of
Member States and considers that the four freedoms of the single
marketthe free movement of goods, capital, services and
personsshould apply upon accession or as soon as practicable
thereafter. (Paragraph 78)
54. The Government's objective continues
to be that new Member States should participate as full and equal
members of the EU as early as possible.
55. With almost all of the negotiating chapters
now opened with the Luxembourg Six countries (29 out of 31), we
now have a better view of the issues that need further negotiation.
In his speech in Budapest in July, the Secretary of State called
for a new phase of negotiations to solve these issues: we need
to tackle the candidates' requests for transition periods in order
to make progress, and maintain the momentum of negotiations.
56. The Government agrees with the Committee;
the EU should not accept transitional period requests that might:
seriously distort the operation of
the Single Market or compromise the health and safety of its citizens;
seriously impair a candidate's ability
to function as a market economy, or
seriously compromise the ability
of its administrative structures to implement EU legislation and/or
meet the Copenhagen criteria.
57. The Government believes that the EU
should be prepared to grant requests for transitional periods
that fall outside these areas if there is a strong economic or
other rationale for doing so. In determining whether a request
is sensible or not, the EU should be fair, realistic and generous.
The EU should, on a case by case basis:
be cautious in assuming that any
transitional period will automatically produce an unfair competitive
advantage for the acceding country;
look seriously at requests in areas
where existing Member States have had, or still enjoy, transitional
recognise that, for economies in
transition, some of the obligations of membership will be exceptionally
expensive to implement, and we should ask ourselves whether it
makes sense for them to try to comply fully from the date of accession
with those directives requiring heavy investment.
58. Nevertheless, the Government still expects
transitional periods to be the exception rather than the rule.
It also believes that transitional periods should be limited in
time, scope and duration and be accompanied by a plan with clearly
defined stages for full implementation.
The Committee believes that the Government
should urge the EU to give closer attention to the impact of its
current enlargement policies on relations between countries in
the region and to ensure they do not exacerbate divisions between
countries. (Paragraph 79)
59. The Government continues to believe
that regional groupings have an important role to play in promoting
EU integration, free trade, conflict resolution, and economic
co-operation both among candidates and between candidates and
60. The Government therefore welcomes the
co-operation that has grown up between the Luxembourg Six countries
and the Helsinki Six countries. The Visegrad Four (Poland, Hungary,
the Czech Republic and Slovakia) has members in both groups, but
all four countries share the same focus on enlargement, and in
particular seek a satisfactory solution to border control in an
enlarged EU. The Government has increased its dialogue with the
Visegrad Four. The leaders (with the Hungarian Foreign Minister
representing Prime Minister Orban) met the Prime Minister in Warsaw
on 6 October and Mr Vaz hosted his counterparts at a meeting at
Hanbury Manor on 31 March-1 April 2000.
61. The Baltics comprise another important
regional grouping that cuts across the Luxembourg/Helsinki divide.
This group meets also within the wider context of the Northern
Dimension. The Government fully supports the Action Plan for the
Northern Dimension, adopted at the Feira European Council, which
offers a forum for the EU's northern neighbours, including Russia,
to work together.
62. The Government is keen to find ways
of ensuring that cross-border co-operation between candidates
and their neighbours is strengthened, not weakened, as a result
of EU enlargement. It is working closely with the Governments
of Poland and Ukraine on a number of trilateral economic transition
projects. It has been instrumental in ensuring that the EU's objectives
on enlargement and the promotion of Balkans stability are compatible,
and in particular will lead to the growth of intra-regional co-operation
and trade patterns. The EU Common Position on the external relations
chapter notes the importance of maintaining good links between
the EU candidates and their eastern neighbours, so that the EU
candidates are not discouraged from maintaining their existing
agreements with their neighbours, including free trade agreements.
Funds continue to be available under the EU's PHARE programme
to support cross-border co-operation projects.
We believe that commitment to the process
of enlargement must mean a commitment of resources to increasing
relations with applicant states at all levels: diplomatic administrative,
commercial and industrial. We look forward to witnessing the "good
results . . . in the near future" which Ms Quin promised
would result from the increased commitment of FCO resources and
diplomatic activity in the applicant states. (Paragraph 92)
63. The Government will continue to commit
resources to relations with the candidates. Last year, the FCO
established 11 new UK-based and 12 locally engaged slots in candidate
64. The main vehicles for support to the
candidate countries are individual country "Action Plans".
The first was launched in October 1999. These plans enable better
co-ordination and targeting of the Whitehall effort on pre-accession
assistance, and use FCO programme budget money on specific, new
projects. So far, Action Plans have been launched with Poland,
Hungary, Czech Republic, Slovenia and Malta. One for Estonia is
in preparation, and Plans for the remaining "candidate countries"
will follow next year. In financial year 2000-01, £500,000
of FCO funds will be spent on Action Plans. A further £500,000
will be committed to training courses for candidate countries'
officials run by the Centre for Political and Diplomatic Studies
(CPDS), training projects run by the British Association for Central
and Eastern Europe (BACEE), twinning projects administered by
the FCO, and various continuing commitments such as Romanian diplomatic
training and assistance to the Latvian EU Integration Bureau.
The Committee concludes that now is not the
time to reduce Know How Fund expenditure to the "first wave"
applicant states. (Paragraph 97)
65. Expenditure should reflect the relatively
advanced state of development of candidate countries and the availability
of resources from the EU, World Bank and other multilateral agencies
to which the UK contributes.
66. The currently agreed framework figures
for 2000-01 to 2001-02 are: