Memorandum from the Secretary of State,
Foreign and Commonwealth Office
PROSPECTS FOR THE EUROPEAN COUNCIL, BARCELONA, 15-16
MARCH 2002
INTRODUCTION
1. The Barcelona European Council is the
third in a series of Spring European Councils devoted primarily
to the economic reform process. Subjects for discussion are likely
to include Energy Liberalisation; Networks; Education; Labour
Markets; Financial Services; Single Market Scoreboard; Sustainable
Development; Galileo; and Council Reform.
ENERGY LIBERALISATION
2. The UK supports full energy market opening.
We hope that the Barcelona meeting will agree on target dates
for full liberalisation for non-domestic consumers, possibly by
2003. And we will argue for a commitment to full domestic liberalisation.
We would also like Barcelona to set out the key principles underpinning
effective market opening, such as legal separation of production
and distribution, effective regulation, equal access to the infrastructure
network, sufficient interconnection, and clarity of rules.
NETWORKS
3. The Presidency is expected to cover five
main issues under this heading:
(a) Transport and energy TENs (Trans European
Networks);
(c) The second rail package;
(d) Phase two of the eEurope Strategy;
(e) Energy interconnection.
4. On TENs, we want conclusions that highlight
the importance of increasing private sector funding for projects,
but which do not put pressure on agreed budget lines.
5. We would like Barcelona to call for agreement
on the Single Sky (single EU air traffic management system) framework
regulation by the end of the year. This would enable the creation
of the Single Sky by 2005.
6. We broadly support the Commission proposals
for a second rail package on further liberalisation and integration
of the EU's railways. This has the potential to contribute to
the EU's environmental objectives, as well as encouraging better
interconnection across the EU rail network. It would complete
liberalisation of the EU market for rail freight, providing opportunities
for the UK industry.
7. The current eEurope strategy, agreed
at Lisbon and part of the drive to deliver the ``information society'',
has helped stimulate levels of access to the internet and reduce
the cost of getting on line. But it comes to an end this year.
We and most other Member States want Barcelona to agree a new,
follow-up strategy, focussed on broadband technologies (fast internet
access, which is ``always on'' and allows access to interactive
services). So, with support from most Member States and the Commission,
we will push for conclusions that set a target of widespread availability
of broadband technologies by 2005. This is consistent with the
UK's own target for delivering an extensive and competitive broadband
market. We also want language that emphasises the important role
of competitive markets in delivering broadband.
8. The Presidency is expected to push for
language on better interconnectivity of energy networks. We support
this in principle, as better interconnection between different
countries has an important role to play in creating a genuinely
liberalised internal energy market, and for security of supply.
But any objectives or targets must reflect the needs of the market.
EDUCATION AND
TRAINING
9. Education and training are central to
the economic reform agenda, which stresses the need for a skilled,
flexible and employable workforce able to respond to the rapidly
changing demands of the modern labour market. Barcelona will consider
three documents designed to achieve this goal:
(a) a work programme for the Education Council
to 2010. This concentrates on the exchange of good practice between
Member States in the education field and is based upon the education
objectives presented to last year's spring Council in Stockholm;
(b) a Commission framework strategy for promoting
lifelong learning, ``Making Lifelong Learning a Reality'';
(c) a Commission Action Plan on Skills and
Mobility in response to the recommendations from the Skills and
Mobility Task Force.
10. We want Barcelona to keep the spotlight
on employability and ensure that further work on this helps meet
the Lisbon jobs target. In particular, we want to stress the need
for individuals to acquire basic skills, and for action to address
the challenges of insufficient occupational mobility; low level
of geographical mobility; and poor access to information on mobility.
11. The UK has been the initiator of two
specific ideas on which we hope Barcelona will make progress:
a schools ``internet twinning'' initiative, first discussed by
the Prime Minister and Aznar during their meeting last Autumn.
The main aim of the proposal is that the EU will support any secondary
school in the EU that wants to set up a link with a partner school
in another Member State. Barcelona is expected to ask the Commission
to explore the options for taking this forward. Barcelona is also
likely to endorse a UK idea—which the Spanish support—for
using small groups of Member States to exchange good practice
and advance work quickly and informally on priority areas, before
reporting back to the full Education Council and its working groups.
LABOUR MARKETS
12. We would like Barcelona to send a strong
signal about the role of labour market reform in delivering the
EU's employment objectives. We want Barcelona to ensure the review
of the European Employment Strategy (EES) reflects this. In particular,
we would like conclusions on the need to make work pay (making
sure people are better off in work than out); the importance of
lifelong learning and of a flexible and mobile workforce; with
a focus on getting the unemployed and inactive, particularly women
and older workers, back into the labour market. We welcome the
Action Plan on Skills and Mobility, to be endorsed at Barcelona,
as a positive contribution towards increasing labour market mobility.
We want future emphasis to be on capturing the best approaches
of Member States through a process of benchmarking and exchange
of good practice.
FINANCIAL SERVICE
13. We want Barcelona's conclusions to reaffirm
the focus of the Financial Services Action Plan as: cutting the
cost of capital for firms; and more choice and lower prices for
consumers and investors. We also want Barcelona to prioritise
the Commission's work on indicators of the success of financial
market liberalisation; and to highlight progress on the Lamfalussy
procedure (which aims to provide faster and more flexible financial
services legislation), and push for its proper implementation.
OTHER UK ECONOMIC
REFORM PRIORITIES
14. We want Barcelona to underline the important
of the better regulation agenda. The Commission's Action Plan,
which it should deliver in time for the Seville European Council,
should include measures on: assessing the impact of legislation;
removing redundant red tape; and minimising the amount of legislation
flowing from Brussels.
15. Better regulation is also important
for improving the environment for SMEs. We want Barcelona to emphasise
SME's central role in job creation, innovation and economic growth.
Conclusions should underline the importance of the Small Firms
Charter and other mechanisms for ensuring proper SME representation
in the EU policy process.
16. The UK has been closely involved in
recent work by the Economic Policy Committee, looking at how to
improve the EU's record on R&D and innovation. We would like
Barcelona to endorse the report's key conclusions, including in
particular the need to create a European Research and Innovation
area based on strong networks between Member States. We would
also welcome conclusions on the need to increase private sector
investment in R&D, as part of the drive to improve EU productivity.
17. Biotechnology is another important driver
for innovation, and we would like Barcelona to endorse the Commission's
recent Action Plan: ``Life sciences and biotechnology—A
Strategy for Europe''.
18. We also want Barcelona to help advance
UK ideas on state aids, as agreed by the Industry Council—in
particular the need for less and better state aid. We would like
conclusions reaffirming the need to reduce market-distorting subsidies,
but recognising the legitimate role for targeted aid which helps
to deliver restructuring regeneration or sustainable development.
SINGLE MARKET
SCOREBOARD
19. The Stockholm European Council set Member
States a target for implementation of single market Directives—98.5
per cent in time for Barcelona. The UK has met this target.
SUSTAINABLE DEVELOPMENT
20. Barcelona is the first Spring Council
mandated to consider the Sustainable Development Strategy agreed
at Gothenburg, including the international aspects. The central
message from Barcelona should be one of further progress on economic
reform: but we also want Barcelona to demonstrate the EU's high
level commitment to a successful outcome at the World Summit on
Sustainable Development (WSSD). We want conclusions which reflect
our objective for the Summit (to make globalisation work for sustainable
development, especially for the poorest) and recognise the need
to address inconsistencies between EU's internal and external
policies (eg trade and agriculture) as part of the development
of the EU's position for WSSD.
GALILEO
21. A decision on launching the development
phase of the Galileo satellite navigation system is due at Transport
Council on 26 March, but there could be a preliminary discussion
at Barcelona. Since a decision was deferred by the Laeken European
Council in December, further negotiations have started to address
key concerns of the UK and other Member States about Galileo's
costs, funding and aspects of security and project management.
The Barcelona meeting may assess progress in those areas.
EUROPEAN CENTRAL
BANK VICE-PRESIDENT
22. The successor to the current Vice-President,
Christian Noyer of France, must be appointed by the end of May.
Under the Treaty, Heads of State and Government must decide "by
common accord", following a recommendation from ECOFIN. It
is not clear how the Presidency intend to handle this issue. The
UK, as an "out", does not formally participate in the
selection process.
COUNCIL REFORM
23. Javier Solana, on behalf of the Council
Secretariat, will present proposals for practical steps to reform
the Council, which do not require Treaty change (which would be
a matter for the IGC). We shall highlight our own ideas, as set
out in the Prime Minister's joint letter with Schröder, advocating
that the European Council should:
(a) avoid overloaded agendas;
(b) focus its discussions on strategic and
overarching issues;
(c) as far as possible limit consideration
of individual dossiers;
(d) limit the length and number of the reports
submitted for its consideration;
(e) work by unanimity only in areas where
this is provided by the Treaty: decisions under QMV Treaty bases
should be by QMV;
(f) respect confidentiality;
(g) minimise the time devoted to considering
draft conclusions:
and that the formations of the Council should:
(a) improve their co-ordination, perhaps
through a reduction in the number of formations, and of high level
committees;
(b) hold meeting in public when acting in
its legislative role;
(c) consider ending the practice of table
rounds.
24. We expect that the Presidency will propose
to use the Solana presentation as the basis for a more extensive
discussion, and if possible decisions, on Council reform at Seville.
CFSP ISSUES
25. Heads of State and Government will discuss
key international issues.
Foreign and Commonwealth Office
March 2002
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