Select Committee on European Scrutiny Third Report


2 European Agency for Safety and Health at Work

(25613)

9050/04

COM(04) 50

Commission Communication on the evaluation of the European Agency on Safety and Health at Work accompanied by a proposal for a Council Regulation amending Regulation (EC) No. 2062/94 establishing a European Agency for Safety and Health at Work

Legal baseArticle 308 EC; consultation; unanimity
DepartmentWork and Pensions
Basis of considerationOral evidence from the Minister on 3 November 2004 and Minister's letter of 29 November 2004
Previous Committee ReportHC 42-xxii (2003-04), para 11 (9 June 2004), HC 42-xxx (2003-04), para 6 (9 September 2004) and HC 42-xxxii (2003-04), para 11 (13 October 2004)
Discussed in Council4 October 2004
Committee's assessmentLegally important
Committee's decisionFor debate in European Standing Committee B

Background

2.1 The European Agency for Safety and Health at Work (the Agency) was set up by Regulation (EC) No. 2062/94.[3] The Agency provides technical and economic information about health and safety at work. The information is provided to Member States, the Commission, bodies representing employers, employees and businesses. The Agency organises the annual European Health and Safety Week and a special scheme to support small and medium-sized enterprises (SMEs). It is based in Bilbao.

2.2 The Agency has an Administrative Board comprised of three representatives from each Member State (one representing the Government, one employers' organisations and one employees' organisations) and three representatives of the Commission. With the accession of the new Member States on 1 May, the Board will have 78 members.

2.3 Article 137(1) of the EC Treaty provides for the Community to support and complement Member States' activities in, among other things, improvement of the working environment to protect workers' health and safety. Article 137(2) empowers the Council to adopt measures to encourage cooperation between Member States through initiatives to improve knowledge, develop exchanges of information and best practices, promote innovative approaches and evaluate experiences.

2.4 Article 308 of the EC Treaty empowers the Council to adopt measures for which there is no other legal base and which are necessary to attain, in the course of the operation of the common market, one of the objectives of the Community.

2.5 Article 308 was cited as the legal basis for the Regulation which created the Agency in 1994. At that time, the EC Treaty did not contain what is now in Article 137.

2.6 The document sets out the Commission's proposal for a Regulation to amend the Regulation of 1994 which set up the Agency. The amendments:

  • clarify the Agency's objectives and tasks;
  • reform the constitution of the Agency's Board and Bureau;
  • add a specific requirement for competent national authorities to take account of the views of social partners; and
  • reinforce cooperation with other Community bodies and, in particular, the European Foundation for the Improvement of Living and Working Conditions (the Dublin Foundation).

2.7 Most of the amendments affect the management of the Agency. Notably, a new Governing Board is to replace the Administrative Board and concentrate on the strategic management of the Agency. The Board's membership is to continue, however, to comprise three representatives of each Member State and of the Commission. The Agency's Bureau is given a legal personality and is to have only eight members. The Board is to be able to delegate to the Bureau the exercise of all its functions except those expressly reserved to the Board, such as approval of the work programme and budget.

2.8 The Minister of State for Work at the Department for Work and Pensions (Jane Kennedy) told us in May that the Government generally welcomed the proposals, which had no major policy implications. She also told us, however, that the Government believed that Article 137(2) of the EC Treaty offered a more satisfactory legal base than Article 308, and that it would try to persuade the Commission and other Member States that the former should be used. She added that, if these attempts proved unsuccessful:

      "we would … seek to have a Declaration inserted in the footnote to the amending regulation indicating that we would not regard continuing use of Article 308 as setting a precedent for its use either generally, or in relation to future proposals in respect of the Agency..."

2.9 When we considered the document in June, we concluded that the proposed amendments were reasonable. But we shared the Minister's concern about the citation of Article 308 EC as the legal base for the measure. In our view, this raised a matter of legal principle and we were all the more concerned about it because this was not an isolated case. Despite the Government's and our clear view to the contrary, Article 308 EC was used as the legal base for reforms to the management of the European Centre for the Development of Vocational Training.[4]

2.10 In our view, a Declaration of the kind to which the Minister referred would not cure the defect in the proposed legal basis. Moreover, we could not see the case for accepting such a compromise on an issue of legal principle. We decided, therefore, to hold the document under scrutiny pending the outcome of the Government's discussion with the Commission and other Member States about the legal base.

2.11 In response to our Report, the Minister told us in her letter of 5 August 2004 that she would be particularly cautious about the use of Article 308 EC if it were being proposed as the legal base for a major new piece of legislation. But, she said, in this case:

      "it is simply being used as a basis for a fairly low key amendment to the regulation giving continuing life to the Bilbao Agency.

      "At the Social Questions Working Group on 14 July, there was unfortunately no widespread body of support among other Member States for an alternative Article 137 legal base, meaning the UK is isolated in pressing for this approach. Neither the Commission or [sic] Council supported its use either and the Presidency is pressing for progress.

      "In these circumstances, I do not feel that the UK can realistically continue to oppose use of the Article 308 legal base. We would therefore seek to have a Declaration inserted in the footnote to the amending regulation indicating that we would not regard continuing use of Article 308 as setting a precedent for its use either generally, or in relation to future proposals in respect of the Agency…"

2.12 When we again considered the proposal in September, we noted that one of the European Union's objectives, according to Article 2 of the EU Treaty, is to maintain and develop the Union as an area of freedom, security and justice. Fundamental to the establishment of such an area is respect for the rule of law. It is essential, therefore, that in proposing and approving legislation the Commission and Council should act and be seen to act lawfully. We also noted that it was common ground between the Government and ourselves that, because Article 137 of the EC Treaty was available, the legal criteria for the use of Article 308 as the legal base for the proposed Regulation were not satisfied. Accordingly, we concluded that, until we were provided with a satisfactory explanation why Article 137 was not a suitable legal base, there were no grounds to depart from the view we had taken in June. We asked the Minister, therefore, to press this issue of principle in the Council's further discussion of the draft Regulation or to seek a satisfactory legal justification for the use of Article 308. Meanwhile, we kept the document under scrutiny.

2.13 In response to our further Report, the Minister told us in her letter of 29 September that:

      "Throughout [the] negotiations we have pressed the case that the Article 308 legal base should be replaced by Article 137. However, no Member State has stood with us on this issue. The Employment, Social Policy, Health and Consumer Affairs Council on 4 October will consider draft directives on working time, conditions for temporary agency workers, and equality of access to goods. I believe that we should concentrate our efforts and resources on these negotiations, all of which concern policies of significant importance to the United Kingdom."

The Minister added that the Government would "puzzle" and "irritate" other Member States if it maintained an isolated stand against the Regulation. This would be contrary to the United Kingdom's wider aim. She continued:

      "Given these considerations, the Government has decided that on balance it is better to join the consensus to agree the regulation on the terms that the other Member States have accepted, and lift the Parliamentary Scrutiny Reserve. Given the Committee's reservations about the use of Article 308 in general, and its continued use for this Agency in particular, I fully understand that this will be disappointing news. Nevertheless, I hope that you will understand how the need to focus on substantial policy issues at Council has led to this decision."

2.14 At the meeting of the Council on 4 October, the Government over-rode the scrutiny reserve resolution and the Regulation was adopted.

2.15 When we considered the matter again on 13 October, we recognised the difficulties for the Government when it is isolated in the consideration of one measure and there are other proposals, of major importance, for consideration at the same meeting.

2.16 We noted that the content of this Regulation was uncontroversial and not of major importance. That was not, however, a sufficient justification for adopting it on a legal base which was, as we understood it, unlawful because the EC Treaty has provided an appropriate alternative in Article 137. We had not seen a reasoned case for the unwillingness of other Member States and the Commission to depart from the use of Article 308. Moreover, in our view, the Government could not properly give its agreement to the amending Regulation when, as the Minister had recognised throughout, it had an inappropriate legal base. Accordingly, we invited the Minister to give us oral evidence on these questions. Meanwhile, we kept the document under scrutiny.

The Minister's oral evidence

2.17 The Minister appeared before us on 3 November to give her oral evidence. The Minutes of Evidence are annexed to this Report.[5]

2.18 In answering a question about why the Government had agreed to the adoption of the Regulation by the Council on 4 October, the Minister told us that no other Member State shared the United Kingdom's doubts about the use of Article 308 of the EC Treaty as the legal base for the Regulation. The Government had faced a choice between blocking the proposal and joining the consensus. As a matter of political judgement, the Government decided not to block it, taking into account the need to make progress on other proposals on the agenda which were of greater political and economic importance (Q1).

2.19 In response to our question whether the Minister agreed with the view of other Member States about the appropriateness of using Article 308, we were told that the view of the lawyers of the Health and Safety Executive was that Article 137 was the correct legal base and that the Department for Work and Pensions was "completely at one" with us on that issue (Q4).

2.20 We referred the Minister to the Foreign Secretary's letter of 2 March 2004, in which he told us that the Government would support the use of Article 308 only in cases which met the requirements for its use; his assurance was not qualified by any reference to political considerations. In October, however, the Minister had agreed to the Regulation despite the Government's unambiguous view that Article 308 was not the lawful legal base for it. We asked the Minister, therefore, if she would refer the matter to the European Court of Justice under Article 230 of the EC Treaty (Q6). The Minister told us that she had been aware of the contents of the Foreign Secretary's letter. She did not wish to give a snap answer to the question about making a reference to the European Court of Justice, but if pressed for an immediate reply, she would say that the Government would not go to the Court. She would write to us about the issue (Q26).

2.21 The Minister told us that she agreed that it is essential for the Commission in proposing legislation and for the Council in adopting it to act lawfully (Q10).

2.22 In response to the question whether it was lawful for the Council to adopt the Regulation (Q13), the Minister told us that:

      "The advice I have received from legal advisers to the Health and Safety Executive, even as late as yesterday, was that 308 was not appropriate in this case and that Article 137 would have provided a more sure legal basis for this particular regulation. I cannot put it any more strongly than that."

In reply to further questioning about the lawfulness of the Council's action (Q14 and Q15), the Minister said that it was the view of the Government, and of the legal advice it had received, that:

      "Article 308 was not necessary to be used in this case."

2.23 We also asked the Minister why Article 137 of the EC Treaty would not have been an adequate legal base for the Regulation (QQ18-20). She told us that the other Member States and the Commission had taken the view that, because the Agency performs an advisory role, rather than a regulatory one, Article 137 would not be sufficient; but the Government had not thought that the Agency's role was purely advisory and had regarded Article 137 as appropriate.

The Minister's letter of 29 November

2.24 In her letter to us of 29 November, the Minister says:

      "When I gave oral evidence to your Committee on 3 November about my reasons for applying a scrutiny override to [this] proposal, I promised to write to you about the lawfulness of the Article 308 EC legal base used for the amendment of the Agency's founding regulation and whether the Government would seek to raise the matter with the European Court of Justice.

      "The UK view was that Article 137 EC was the most appropriate legal base for the proposed amendment. However, we always recognised that there were counter arguments in favour of the use of Article 308 EC — for example, the tripartite nature of the Agency. We were unable to convince the Commission or any other Member State that our legal view was to be preferred.

      "There was a positive argument in favour of using Article 308 EC in terms of the purposes of the Article. It is undeniable that the Agency does very important work in raising the standard of health and safety across Europe consistent with the objectives specified in Article 136 EC to which Article 137 EC refers. In my letter of 29 September I described how the Agency's work furthers the objectives of the Common Market:

'… an efficiently functioning Agency does very important work via the dissemination of information and good practice in driving up the standard of health and safety in some of the poorer and new entrant Member States that lack the resource and infrastructure of the older community members. This contributes to achieving the level playing field in the Common Market and benefiting its citizens, including UK nationals who work on the continent.'

      "Following the oral evidence session with the Committee, I asked officials to carefully re-examine the Article 308 issue. This process involved consultation with Cabinet Office Legal Advisers. We always recognised that there were counter arguments in favour of the use of Article 308 EC — for example the tripartite nature of the Agency — and during these discussions it emerged that the unsuitability of Article 308 was not as clear cut as our original legal advice had led us to believe. Taken with the linkage of the Agency's work to the Common Market objectives, it is not definitive that use of the Article 308 EC legal base was unlawful. Accordingly, I would be hesitant to initiate a challenge at the European Court of Justice."

Conclusion

2.25 We are grateful to the Minister for her oral evidence and her letter of 29 November. It seems to us, however, that her letter offers only one new argument why Article 137 of the EC Treaty would not be the appropriate legal base for the amending Regulation: "the tripartite nature of the Agency". The Minister does not explain why this might call into question the use of the Article. The Board of the Agency is comprised of one representative of the Government of each Member State, one representative of employers' organisations in each Member State, one representative of employees' organisations in each Member State and three representatives of the Commission. This is the only sense, so far as we can see, in which the Agency has a "tripartite nature".

2.26 Assuming that it is this to which the Minister's letter refers, we can see nothing in Article 137(2) to prevent the use of that provision as the legal base for the Regulation. Article 137(2)(a) provides that, for the purpose of the Community supporting and complementing the activities of the Member States in the fields specified in Article 137(1), the Council:

      "may adopt measures designed to encourage cooperation between Member States through initiatives aimed at improving knowledge, developing information and best practices, promoting innovative approaches and evaluating experiences, excluding any harmonisation of the laws and regulations of the Member States."

It appears to us that the Agency is an initiative designed to encourage such cooperation between Member States. Since Article 137(3) EC makes express provision for the involvement of management and labour in the implementation of Directives adopted under Article 137(2), it seems to us unlikely that the tripartite nature of the Agency is a factor which prevents the use of Article 137 as the legal base in this case.

2.27 Apart from "the tripartite nature of the Agency", we have been offered only one other explanation for the view of the Commission and other Member States that Article 137 would not be appropriate: that the Agency has an advisory, not a regulatory role. But we can see nothing in Article 137 which would rule out the use of that Article as the legal base solely because the Agency is not a regulatory body.

2.28 We note that it is now the Government's view that "the unsuitability of Article 308 was not as clear cut as our original legal advice had lead us to believe". But we also note that this revised view was not adopted until after the Minister had overridden the parliamentary scrutiny reserve.

2.29 It has been our opinion, throughout our scrutiny of the proposal, that the amendments proposed in the document are reasonable. That is not the issue. Our concern is that the Council should act lawfully. We see it as our duty to alert the House if — as in this case — we consider that there are grounds to believe that the Council has not acted lawfully. Accordingly, we recommend the document for debate in European Standing Committee B.


3   OJ No. L 216, 20.8.94, p.1. Back

4   (25350) 6030/04; see HC 42-xii (2003-04), para 2 (10 March 2004); HC 42-xvii (2003-04), para 2 (21 April 2004); and HC 42-xx (2003-04), para 13 (18 May 2004). Back

5   QQ1-27. Back


 
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