17 The Lisbon Strategy
| (27244)
5745/06
COM(06)30
+ADDS 1 & 2
| Commission Communication: Time to move up a gear — Part 1: The new partnership for growth and jobs, Part 2: Country chapters
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| Legal base | — |
| Document originated | 25 January 2006
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| Deposited in Parliament | 31 January 2006
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| Department | HM Treasury |
| Basis of consideration | EM of 2 March 2006
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| Previous Committee Report | None
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| To be discussed in Council | 20-21 March 2006
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| Committee's assessment | Politically important
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| Committee's decision | Clear
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Background
17.1 The Lisbon Strategy intends the Community "to become
the most competitive and dynamic knowledge-based economy in the
world, capable of sustainable economic growth with more and better
jobs and greater social cohesion". The Spring 2005 European
Council commented that "alongside undeniable progress"
on the Strategy "there are shortcomings and obvious delays"
and endorsed a Commission Communication on a new start, which
included a call for Member States to produce National Reform Programmes.[55]
The June 2005 European Council repeated the call for National
Reform Programmes and asked the Commission to complement these
with a "Lisbon Community programme covering all the action
to be taken at Community level", which they did a month later.[56]
The document
17.2 In this Communication the Commission sets out for the Spring
European Council its assessment of the Member States' National
Reform Programmes. The Communication is in three sections. Part
1 is an overview drawing out the key messages from the National
Reform Programmes. It concludes that the programmes, while providing
a good start, are not sufficient to deliver the Lisbon Strategy
objectives. So it proposes four priority areas for action, with
specific actions suggested for each, at Community and Member State
level:
- investing more in knowledge and innovation;
- unlocking business potential, particularly of
small and medium-sized enterprises;
- responding to globalisation and ageing; and
- moving towards and efficient and integrated Community
energy policy.
17.3 Part 2 of the Communication assesses each National
Reform Programme and recommends points for further attention.
The Commission says that amongst points for the UK are:
"budgetary consolidation, in the light of
the need to upgrade transport infrastructure and to ensure an
adequate pension system; additional policy initiatives to boost
R&D and improve transport infrastructure; [and] efforts to
address skills challenges and to improve employment prospects
for the most disadvantaged."
17.4 The Communication's Annex has a detailed analysis
of the National Reform Programmes underpinning the overview in
Part 1.
The Government's view
17.5 The Financial Secretary to the Treasury (John
Healey) tells us the Government broadly welcomes the Commission
Communication, saying it rightly points out that the Community
must respond to the challenges of globalisation and ageing with
a "full range of policies and instruments". He notes
that the ECOFIN Council in December 2005 agreed on a preliminary
assessment, prepared by its Economic Policy Committee, of the
policies the Community should put in place to respond to globalisation
and of how these first National Reform Programmes fared against
this. The Minister says the Commission's analysis is consistent
with, and builds on, these Council views.
17.6 The Minister continues that the Government
agrees that:
- the National Reform Programmes
provide a good basis for progress on reform;
- there is a general consensus on the key priorities
— sustainability of public finances, labour supply, research
and development, the business environment and environmental sustainability;
- competitive markets are a prerequisite to achieving
the Lisbon Strategy objectives; and
- in many areas "the centre of gravity for
action lies at the Member State level".
He says it also agrees that the National Reform Programmes
in themselves are not sufficient to deliver the Lisbon Strategy
goals, the Communication noting, for example, that the Community
will only meet the 70% employment rate target in 2020 rather than
2010. The Minister approves the Communication statement that "the
process of producing and evaluating the national reform programmes
has highlighted gaps to be filled and synergies to be exploited.
In many cases, gaps can be tackled by Member States' improving
their national reform programmes".
17.7 In relation to the Communication's four priority
areas for further action at Community and Member State level,
the Minister says that the Government agrees with them and notes
that the 30 or so specific actions mentioned (a number of which
would require Community funding) will be discussed and negotiated
in preparation for the Spring European Council. He continues that
the Government welcomes many of the specific proposals, which
complement Government policy, for example, that:
- Member States should improve
the framework conditions for private-sector research and development;
- universities should be allowed to seek complementary
private sources of funding;
- there should be a one-stop shop for would-be
entrepreneurs;
- every student should have access to entrepreneurship
training;
- all Member States should adopt a methodology
for measuring the administrative burden of new regulations and
that the Commission should launch a major exercise to measure
the administrative costs arising from Community rules;
- Member States should enhance financial incentives
for older workers to remain active and develop active ageing strategies;
and
- there should be more competition in Community
electricity and gas markets with full and effective market opening
by 1 July 2007.
But the Minister is less enthusiastic about the Commission's
call for a communication strategy to raise awareness of the Lisbon
Strategy in Member States.
17.8 The Minister concludes his general comments
by saying that overall the Government agrees with the Communication
that "effective implementation of the national reform programmes
and their contribution to growth and jobs must now become the
prime focus of attention".
17.9 As for the passage on the UK's National Reform
Programme the Minister says the Government welcomes the broad
analysis and notes the emphasis on strengths such as better regulation,
the pilot policy to assist incapacity benefits claimants to re-enter
the labour market and policies on competition and entrepreneurship.
He also asserts the Government is already addressing the issues
which the Communication notes as needing further attention.
Conclusion
17.10 This document, which we clear, usefully
summarises both the content of Member States' National Reform
Programmes and what needs to be done to make practical progress
towards the Lisbon Strategy objectives. We applaud its ambition
but note the words of the President of the Commission in his note
covering the document: "So we know what we are aiming for,
and we know how to get there. But now for the difficult part:
turning good intentions into action. Reform needs to be the guiding
principle for national as well as European economic policy."
55 See (26351) 5990/05: HC 38-xii (2004-05), para 12
(23 March 2005). Back
56
See (26765) 11618/05: HC 34-x (2005-06), para 22 (16 November
2005). Back
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