Select Committee on European Scrutiny Thirty-First Report


The European Scrutiny Committee has agreed to the following Report:—







COM(02) 109

Proposal for a Regulation of the European Parliament and of the Council on aid for poverty diseases (HIV/AIDS, malaria and tuberculosis) in developing countries.

Legal base:

Article 179(1) EC; co-decision; qualified majority voting


Document originated:

4 March 2002

Deposited in Parliament:

22 March 2002


International Development

Basis of consideration:

EM of 21 March 2002

Previous Committee Report:


To be discussed in Council:

30 May Development Council

Committee's assessment:

Politically important

Committee's decision:

For debate in European Standing Committee B, together with the document on the World Summit for Sustainable Development, already recommended for debate; further information requested



33038.33048 This proposed Regulation will replace the 1997 Council Regulation[1] which addresses HIV/AIDS-related prevention, the delivery of health and social services, and the strengthening of health systems and support for research operations in developing countries. It will provide support for the Programme for Action on "Accelerated Action targeted at major communicable diseases within the context of poverty reduction", adopted by the General Affairs Council on 14 May 2001.[2]

33038.33049 The draft Regulation provides for a comprehensive package which targets simultaneously development co-operation interventions, trade relations and research for new pharmaceutical products for the three major communicable diseases affecting the poor: HIV/AIDS, malaria and tuberculosis (TB). The purpose of the activities carried out will be to:

optimise the impact of existing interventions, services and commodities targeted at the major communicable diseases affecting the poorest populations;

increase the affordability of key pharmaceuticals; and

increase research and development activities related to vaccines, microbicides and innovative treatments.

33038.33050 To further these objectives, financial support will be given to specific projects, including those which aim to:

"—  provide the necessary technical, scientific and normative input in order to prioritise health interventions within the total development co-operation budget and improve health outcomes related to the three major communicable diseases, keeping a balanced approach between prevention, treatment and care, with a primary focus on prevention;

improve the performance of health interventions targeted at the three major communicable diseases within the context of a comprehensive health system;

improve pharmaceutical policies and practice, and help developing countries, at regional or national level, to develop high-quality local production of off-patent and/or licensed key pharmaceuticals;

promote global tiered pricing for key pharmaceuticals for developing countries;

analyse the effects of factors, such as the level of net import price, tariffs, taxes, and importation, distribution and local registration fees, on consumer prices of medical goods in developing countries;

provide, where appropriate, technical assistance to developing countries to help them address public health issues in accordance with the provisions of the Agreement on Trade Related Aspects of Intellectual Property Rights (TRIPs) as clarified in the Doha Declaration on the TRIPs Agreement and Public Health;

develop an incentive package to encourage more private investment by the Research and Development based industries in new products, particularly vaccines and microbicides, designed to fight the major communicable diseases in developing countries;

support collaborative clinical, epidemiological, operational and social studies, so as to enable health-related research to be conducted on a sounder basis;

encourage capacity building in developing countries, to enable them to co-ordinate, host and conduct large-scale population trials;

support global initiatives targeting the major communicable diseases in the context of poverty reduction, including the Global Fund to fight HIV/AIDS, tuberculosis and malaria which came into operation on 29-01-2002."

33038.33051 Specific targets and indicators will follow the Millennium Development Goals[3] defined for HIV/AIDS, malaria and tuberculosis. Proposed indicators are:

HIV prevalence among15-24 year old women;

contraceptive prevalence rates;

number of children orphaned by HIV/AIDS;

prevalence and death rates associated with malaria;

proportion of population in malaria risk areas using effective malaria prevention and treatment measures;

prevalence and death rates associated with tuberculosis;

proportion of TB cases detected and cured under DOTS (Directly Observed Treatment Short Course).

33038.33052 New innovative partnerships will be sought and a contribution will be made to global initiatives.

33038.33053 The Regulation covers the period 1 January 2003 to 31 December 2006. The Commission says that the financial framework proposed represents a substantial increase over that of the earlier Regulation, in order to implement the Programme for Action. It proposes an envelope of _75 million per annum, of which _35 million would be dedicated to the Global Fund to Fight AIDS, TB and Malaria.[4] The final amount was expected to be decided by the end of February.

The Government's view

33038.33054 The Secretary of State for International Development (Clare Short) says that the Government welcomes and supports the goals of the proposal. The rationale for it accords with her Department's approach to "combatting communicable diseases affecting the poor, with the rationale for the existence of the Global Fund to Fight AIDS, TB and Malaria, with other G8 member commitments, and with the broader international commitment to poverty reduction."


33038.33055 We understand that this proposal is not likely to be ready for adoption at the 30 May Development Council as originally hoped. Perhaps this is not surprising, given the complexities of the task, including the size of the financial envelope, which will also cover the EU's contribution to the Global Fund. Another major issue is that of tiered pricing of medicines. This is the only issue referred to under the Health heading in the draft Council Conclusions on the World Summit on Sustainable Development (WSSD),which we have referred for debate in European Standing Committee B[5].

33038.33056 We recommend this document for debate in European Standing Committee B, together with the document on the WSSD. Meanwhile, we ask the Minister to bring us up to date on the key issues under discussion in the negotiations on the proposal in time for the information to be considered before the debate takes place.





COM(02) 191

Commission Recommendation for the 2002 Broad Guidelines of the Economic Policies of the Member States and the Community.


Legal base:

Article 99(2) EC; inform; qualified majority voting


Document originated:

24 April 2002

Deposited in Parliament:

17 May 2002


HM Treasury

Basis of consideration:

EM of 21 May 2002

Previous Committee Report:


Discussed in Council:

4-5 June 2002

Committee's assessment:

Politically important

Committee's decision:

For debate on the Floor of the House, together with the Stability and Convergence Programmes already recommended for debate[6]




33038.33057 Broad Economic Policy Guidelines (BEPGs) are at the centre of the economic policy co-ordination process in the EU. BEPGs cover a wide range of policy areas, including public finance, labour and product markets. The first stage of the coordination process is for the Commission to formulate a recommendation to Council (ECOFIN) relating to individual Member States and the Community. ECOFIN, acting by a qualified majority, then formulates a draft for the BEPGs of the Member States and the Community and reports its findings to the European Council. The European Council discusses a conclusion on the basis of the report from ECOFIN. This conclusion is used by ECOFIN as the basis of a recommendation formally setting out the guidelines. Finally the recommendation is adopted by ECOFIN, acting by qualified majority.

33038.33058 When agreed by the Council, BEPGs provide the reference text for the Commission and Council to monitor economic developments within the EU and Member States. BEPGs come into effect in June and an assessment of their implementation is made in the following March, which informs the subsequent BEPGs.

33038.33059 We recommended the BEPGs for 2001 for debate on 17 October 2001[7]. The debate was held on 9 January 2002.

The document

33038.33060 The document, which sets out the Commission's Recommendation for the 2002 BEPGs, is divided into two parts: General Economic Policy Guidelines applicable to all Member States and the Community, and Country-Specific Policy Guidelines applicable to each individual Member State. The Economic Secretary to the Treasury (Ruth Kelly) summarises the main priorities and policy requirements in her Explanatory Memorandum of 21 May 2002. She comments:

"The Commission's assessment of economic prospects is based on their Spring forecasts published in April 2002. Following the slowdown in 2001, the Commission notes that there are now signs of the start of a recovery, although the Commission acknowledges there are persistent downside risks. The Commission sees growth in the EU reaching a level close to potential around late 2002, when these Guidelines should be in process of being implemented, although it may take longer for positive effects on employment to become visible. The Commission also comments that the introduction of euro currency was smooth, helping stability and confidence.

"In its Spring forecasts the Commission expects economic growth in 2002-03 to be recover following the recent global downturn. The Commission forecasts for the euro area an average growth rate of 1.4% in 2002, increasing over the course of the year, and then 2.9% in 2003. The Commission notes that Member States outside the euro area should also expect to experience a recovery in growth.

"The Commission highlights four areas of EU policy as deserving particular attention:

(a)  safeguarding and further strengthening the macroeconomic framework;

(b)  Promoting more and better jobs, raising labour force participation and addressing persistent unemployment;

(c)  Strengthening conditions for high productivity growth;

(d)  Promoting sustainable development in the interest of current and future generations.

33038.33061 The Commission's guidelines for each Member State are divided into three parts: (i) Budgetary Policy, (ii) Labour Markets, (iii) Product markets, entrepreneurship and the knowledge based economy. As regards the UK, the Minister summarises the Commission's guidelines for the UK as follows:

"The Commission notes that economic activity in the UK held up well during 2001, with GDP growing by 2.2%. The Commission expects growth in 2002 to be 2%, but to rise to above trend in 2003 as exports grow. The Commission notes that the UK has low levels of unemployment, and forecasts that inflation will continue to remain low averaging under 2% in 2002 and 2003.

"Key challenges highlighted for the UK are raising productivity, addressing areas of concentrated unemployment, and improving public services, notably transport.

"Budgetary policy

"The Commission notes that the UK projections show a move into a deficit of 0.2%GDP in 2001-02, and 1.1% in 2002-03, remaining at that level until 2006-07. The Commission notes that the deficit of around 1% persists as a result of a cautious trend growth assumption of 2.25% per annum, and addressing low levels of government investment. The Commission comments that with its low and falling government debt, the UK is in a good position to deal with population ageing, and that the public finances are sustainable on current policies. It recommends that the UK should:

(i)  ensure, in preparing the budget and in framing future expenditure plans, that in 2003-04, an outturn for the general government balance can be expected that respects the terms of the Stability and Growth Pact of a budgetary position that is close to balance or in surplus;

(ii)  allow public investment, net of depreciation, to rise from 2001-02, as projected in the convergence programme, and as suggested in the 2001 BEPGs.

"Labour markets

"The Commission notes that the UK labour market remains one of the best performing in the EU, and in 2000, all of the Lisbon/Stockholm targets were met. Unemployment remains close to its lowest level for 20 years, and long-term unemployment continues to fall. The Commission notes that the numbers of working-age people claiming sickness and disability benefits rose by 2.6% in 2000, and that local areas of concentrated unemployment in some areas remains a concern. It recommends that the UK should:

(i)  reinforce active measures targeted at those communities and individuals most prone to the risk of concentrated or long-term unemployment and inactivity;

(ii)  reform sickness and disability benefit schemes to provide people who are able to work with the opportunities to do so.

"Product markets, entrepreneurship and the knowledge-based economy

"The Commission notes that the UK's economic environment is favourable to entrepreneurship in view of the low levels of regulation and corporate tax rates. State aid is among the lowest in the EU, and liberalisation of network industries is advanced. IT expenditure and the level of internet access are both above EU average levels. However, the Commission comments that productivity remains relatively low in the UK, due to weak competition in some sectors, skills shortages and under-investment in the economy. In view of this, the Commission recommends that the UK should:

(i)  continue to improve competition, building on existing policy measures, in sectors such as retail banking, postal services, and the professions;

(ii)  deliver the announced infrastructure investment in the railways, establish a new railway infrastructure company and improve the regulation of the railway sector."

The Government's view

33038.33062 The Minister says:

"The Commission's recommendation for the 2002 BEPGs sets out the Commission's views on the economic priorities for the year ahead. However, the Guidelines are non-binding, Article 249 (ex 189) states that 'recommendations and opinions shall have no binding force'.

"The Government has been keen to develop the role of the BEPGs, in particular to make them more focused and measurable, as part of the overall programme of EU multilateral surveillance. The Government supported that the BEPGs should follow the Spring European Council and the priorities it set out for economic policies.

"As such, the Government shares the EU's strategic goal agreed at Lisbon and reinforced at Barcelona. This requires a strategy of sound macroeconomic policies, and comprehensive reforms of product, capital and labour markets. The Government's policies for achieving these are sound macroeconomic policies based on well-managed public finances and low inflation; and structural reform, including improvements in the workings of goods and services markets, reforms to improve the functioning of labour markets, including better job search, improved training and better incentives to work for the low paid, better regulation and promotion of entrepreneurship.

"The UK Government agrees that in framing future expenditure plans it should endeavour to respect the terms of the Stability and Growth Pact, but this must be a prudent interpretation of the Stability and Growth Pact which takes into account the economic cycle, sustainability and the important role of public investment (as specified in Article 104 of the Treaty).


33038.33063 We emphasise that, while the Broad Economic Policy Guidelines (BEPGs) are at the centre of the economic policy co-ordination process in the European Union, they are not binding on Member States.

33038.33064 The debate on the 2001 BEPGs was held against the backdrop of a deterioration in the prospects for the global economy, whereas according to the Commission there are now signs of the start of a recovery, although the Commission acknowledges that there are risks of deterioration. We are recommending the 2002 BEPGs for debate to provide an opportunity for Members to explore the EU's priorities for economic policies for the medium and long term, especially those relating to the UK.

33038.33065 On 10 April 2002 we recommended that the Stability and Convergence Programmes (SCPs) for individual Member States be debated. In view of the importance of budgetary policy to the BEPGs, it would be appropriate to debate the SCPs at the same time as the 2002 BEPGs.

33038.33066 ECOFIN is expected to adopt a draft of the 2002 BEPGs on 4 June 2002. The Seville European Council on 21/22 June will then produce a conclusion on the 2002 BEPGs, before final adoption by ECOFIN. Accordingly, we recommend that a debate be held on the Floor of the House before the Seville European Council on 21/22 June.




















Draft Directive laying down minimum standards on the reception of applicants for asylum in Member States.



Draft Directive laying down minimum standards on the reception of applicants for asylum in Member States.



Draft Directive laying down minimum standards on the reception of applicants for asylum in Member States.


Legal base:

Article 63 EC; consultation; unanimity



Home Office

Basis of consideration:

(b) and (c) EM of 17 May 2002

Previous Committee Report:

(a) HC 152-xxvi (2001-02), paragraph 7 (24 April 2002)

To be discussed in Council:

13/14 June 2002

Committee's assessment:

Politically important

Committee's decision:

(a) and (b) Cleared

(c) For debate in European Standing Committee B



33038.33067 The aim of the proposal is to harmonise the assistance granted to asylum seekers while their applications are being considered, and to ensure that applicants have "a dignified standard of living" (paragraph 6 of the preamble). It is one of a number of measures intended to set minimum standards in relation to asylum seekers as a first step towards establishing a common procedure and a uniform status for those granted asylum in any Member State.

33038.33068 We have already considered this proposal five times. On the last occasion, we noted that the Minister had not answered one of our previous questions, and, as we were expecting an Explanatory Memorandum on a further amended text, we decided to keep the proposal under scrutiny until that, and the Minister's response, arrived. Both have now been received.

33038.33069 A general approach to the proposal was agreed at the Justice and Home Affairs Council on 25 and 26 April, subject to consideration of two Parliamentary Scrutiny reserves (those of the Netherlands and the UK) and the European Parliament's opinion. The latter, which put forward several amendments, was issued on 25 April.

The new text and the Government's view

33038.33070 In a detailed Explanatory Memorandum, the Minister tells us that the new text (document (c)) contains minor amendments only. She outlines these together with the Government's view as follows:

"Article 6.2. [Documentation]

"The reference to excluding the application of Article 6 when an asylum applicant is being dealt with under an accelerated procedure has been deleted. This has no impact on UK procedures as we do not operate an accelerated procedure in the same manner as other EU Member States... The UK will not change its policy regarding the issue of Application Registration Cards (ARCs) as a result of this draft Directive.

"Article 7.1 [Residence and freedom of movement]

"The wording of the text has been changed, which gives a little more clarity to the paragraph and the reference to public interest has been deleted. As explained in the Explanatory Memorandum submitted on the 8th April, this paragraph has been inserted to allow for the German dispersal system where the Länder are responsible for reception and the issue of residence permits to asylum seekers. Although this does allow for a restriction to the individual's freedom of movement it is not as restrictive as detention."

"Article 13.4

"There has been an addition to this Article which gives an example of a reason why support may be withdrawn or reduced, such as when an asylum applicant has entered into paid employment.


"Article 16.5

"Article 16.5 which prevented the withdrawal or reduction of food, housing, emergency healthcare and healthcare that cannot be postponed has been deleted. All Member States agreed that access to emergency healthcare must not be withdrawn or reduced so an addition has been made to the end of Article 16.3 which states that: 'Member States shall under all circumstances ensure access to emergency healthcare.'

"The Annex

"There have been some amendments to the Annex to the proposed Directive in order to clarify that the statement regarding Article 3 (Scope) applies only to Austria. [The implication of this statement is that Austria will not grant asylum to nationals of candidate countries.] Two further statements have been added that refer to Article 11 (Employment) and 16 (Reduction or Withdrawal of Support). The statement concerning Article 11 states that Germany can agree to this clause on the proviso that the EC has powers regarding access to employment and that the Council Legal Service will issue an opinion on this matter. The statement attached to Article 16 is at the request of the Netherlands and gives a commitment to reaching a decision as quickly as possible on the replacement for the Dublin Convention and requests a considerable shortening of the Dublin procedure."

33038.33071 The Minister tells us that there are now no outstanding points of concern for the Government on the wording of the proposed Directive. She continues:

"Inevitably, compromises have had to be made during the course of negotiations in order to achieve the agreement of all Member States. The Government is satisfied that the text as it stands does not represent the 'lowest common denominator' of Reception conditions found in the European Union. The swift negotiation of this draft Directive signifies an important step towards securing agreement of the measures proposed under Article 63 within the time-scales set out by the Treaty of Amsterdam."

The UK situation

33038.33072 During our consideration of this proposal, we have raised several questions about the situation in the UK with regard to reception conditions for asylum applicants. In particular, we have twice asked the Minister how the UK is able to honour its international obligations if it allows food and housing support to be withdrawn, even if only in certain circumstances.

33038.33073 The Minister now addresses this question, stating:

"The Asylum Support Regulations 2000 have a mechanism whereby support can be withdrawn if there has been a breach of the conditions under which the support was provided. Similarly, clause 26 of the Nationality, Immigration and Asylum Bill provides the Secretary of State may make regulations about conditions to be observed by residents of an accommodation centre. If a centre resident breaches his or her conditions of residence, they may be required to leave the centre. Our policy (both currently and when accommodation centres are introduced) is to give each supported person a copy of the conditions of their support so that they are fully aware of their obligations and the consequences, if they decide to breach the conditions. When support is withdrawn in the UK, decisions are taken on a case by case basis and are subject to a right of appeal. Withdrawal of support may engage ECHR [European Convention on Human Rights] Article 3[8] in some circumstances, however, we do not consider that destitution alone reaches the threshold required to be reached before Article 3 is engaged. In the event that an applicant considers that their rights under the ECHR have been breached they can ask for support to be re-instated. The onus is on the individual to demonstrate any breach. In some cases where conditions have been breached the person may be detained, in which case they will continue to receive basic support in terms of food and accommodation whilst they are in detention.

"It is essential to retain such a mechanism as it acts as a deterrent to asylum seekers who may, for example, refuse to travel to allocated accommodation in the hope that they will be housed in an area of their choice, or vandalise their accommodation in an attempt to be moved to what they perceive to be better accommodation. The UK is not alone in taking this stance. Other Member States also operate procedures whereby reception conditions can be withdrawn or reduced under certain circumstances."

33038.33074 We also expressed concern, echoed during the Second Reading debate on the Nationality, Immigration and Asylum Bill on 24 April 2002, regarding the Access to Education Article of this draft Directive (Article 10). The Minister outlines the UK position as follows:

"The Government will be arranging for the provision of education in accommodation centres which mirrors the nature and type of education received in mainstream schools, but with the ability to focus on the specific needs of the children in the centre. The quality and type of education received will be the same as that provided in mainstream schools. We believe that local schools may be disrupted by a transient population of children from accommodation centres and that there will be benefits in educating children in a centre which would be supportive of their needs, including, for example, the availability of interpreters. We also do not intend children to remain in accommodation centres for long periods. The children of those asylum seekers in receipt of NASS [National Asylum Support Service] support will continue to be educated in local schools."

33038.33075 The Minister also comments on the concern raised during the Second Reading that Article 7 of this Directive (which deals with residence and freedom of movement) would provide a much-used avenue of appeal if only four accommodation centres were established in the UK and applicants were not allowed to move around. She points out that, as the centres will be introduced on a trial basis, and the majority of asylum seekers will continue to be supported and accommodated by the National Asylum Support Service, she does not expect an increased number of legal challenges in this area. She adds:

"In accordance with our policy of providing support for destitute asylum seekers on a no-choice basis, there is no right of appeal to the Asylum Support Adjudicator against the location of accommodation provided to asylum seekers. However, consistent with the requirement in Article 21.1, such decisions are liable to judicial review."


33038.33076 We cannot share the Government's optimism about this draft Directive. Even if, in EU terms, just over a year from circulation by the Council to (possible) agreement may represent "swift negotiation" and even if the text does not represent the "lowest common denominator" of reception conditions in the EU, it is doubtful whether it can "ensure [our emphasis] that applicants for asylum have a dignified standard of living while their applications are being considered". There has had to be too much compromise for dignity to be guaranteed throughout the EU. The amendments won by the Government (over education and over the withdrawal of support, for instance) to ensure that proposed UK practice will fit within the draft Directive are instructive examples of such compromises.

33038.33077 We clear documents (a) and (b) on the grounds that they have been superseded, but we do not consider this a satisfactory set of minimum standards and we therefore recommend document (c) for debate in European Standing Committee B.

33038.33078 In our view, the Standing Committee could usefully invite the Minister to identify specific examples of cases where these minimum standards will result in changes to the existing practice of Member States. It should also explore how the minimum standards will in practice deter or reduce secondary migration, and seek the Minister's views on whether the minimum standards will ensure a dignified standard of living for asylum applicants.


1   Regulation No 550/97/EC Back

2  Not deposited. Back

3  The development goals in the UN Millennium Declaration include eradicating extreme poverty and hunger, achieving universal primary education, promoting gender equality, reducing child mortality, improving maternal health, combatting AIDS, malaria and other diseases, and ensuring environmental sustainability.  Back

4  (22815) 13456/01; see HC 152-vii (2001-02), paragraph 28 (21 November 2001). Back

5  (23416) 7727/02; see HC 152-xxix (2001-02), paragraph 1 (15 May 2002). Back

6  See HC 152-xxiii (2001-02), paragraph 3 (10 April 2002). Back

7  (22389) 8261/01 and (22508) 9326/01; see HC 152-ii (2001-02), paragraph 3 (17 October 2001). Back

8  Article 3 ECHR provides that no one shall be subjected to torture or to inhuman or degrading treatment or punishment. It does not admit of exceptions, and may not be derogated from.  Back

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