JOINT COMMITTEE ON SOCIAL AND FAMILY AFFAIRS debate -
Tuesday, 9 Sep 2003

Vol. 1 No. 12

Green Paper on Services of General Interest: Presentation.

Chairman

The next item is a discussion on the EU document, COM (2003) 270 final, the Green Paper on Services of General Interest. We asked for a presentation on this document by officials of the Department of Enterprise, Trade and Employment as it is a fairly significant document and we wish to make observations on it. A copy of the information note on this document was circulated to members before the last meeting on 24 July. We will allow the officials to make their presentation and then have a question and answer session.

I welcome Mr. Niall Egan and Ms Lorraine Benson from the Department of Enterprise, Trade and Employment and Mr. Tim Quirke and Mr. Ronan Gallagher from the Department of Social and Family Affairs. We thank them for taking the time to give us a resume of the Green Paper on Services of General Interest. The members are concerned that as this is a significant paper we are equipped to make observations on it, and we require assistance in that regard. We are grateful to the officials for coming along. We ask them to give an overview of the document before accepting questions from the members.

Ms Lorraine Benson

I thank the Chairman and the committee for inviting us here and for their interest in this subject. As the Chairman pointed out, it is a very interesting and important subject area. I have responsibility in the Department of Enterprise, Trade and Employment for co-ordinating EU agenda and affairs. Mr. Egan works with me in that area. In matters to do with the Department of Social and Family Affairs I will be asking my colleagues for assistance.

Mr. Egan has put together a summary of the content of the Green Paper, which we forwarded to the committee secretariat and which I presume the committee members have, so rather than reading out the summary I will go through the principal points of interest to the committee.

A Green Paper comes at the very beginning of the legislative process, assuming that legislation or proposals may arise from it. As we are at such an early stage we are still gathering views, and in that context we would welcome the views of the committee. Before I summarise the contents of the document, it might be interesting to place it in context. The Green Paper debate takes place against the backdrop of the enlargement of the EU. That is the first factor of background interest. Second, it is taking place as the treaties of the European Union are changing against the backdrop of the Intergovernmental Conference which commences in Italy in October to discuss the new draft treaty on the European Union. Third, it takes place against the backdrop of the Lisbon agenda, which is to make Europe the most competitive and dynamic economy in the world by 2010. Fourth, from a domestic point of view it is interesting that this whole area received attention and debate in the context of the most recent NESC report, which was the background document to the partnership negotiations which took place earlier this year. That is the backdrop to this Green Paper.

The process is at a very early stage. We are in the process of consulting other Government Departments, agencies and non-governmental organisations. The Commission has set a deadline for the submission of views of 15 September, which is the beginning of next week. It is open to everybody to submit their views individually. We have asked organisations if they want to send their views to us in order to inform our Government view which may eventually be sent to the Commission.

It is actually quite difficult to summarise this Green Paper because it is an extremely complex area. The first thing to ask is what are we talking about? What are services of economic interest or general interest? There is a distinction between services of general interest and of general economic interest. That distinction is made in the Green Paper. The services of general economic interest would be what we know as public utilities like electricity, water, gas, air transport, rail, buses, other transport areas and telecommunications. Areas of general interest would be areas which are not considered to be economic, like health, education and social welfare services. There is a distinction in the Green Paper and in the discussion on the Green Paper between these two areas.

On the first, the area of economic interest, it is true to say that these areas are already covered to a large extent by EU internal market rules. We have seen a lot of legislation over the past ten to 20 years on deregulation and liberalisation of services as the internal market rules are expanded. We have seen in the areas of telecommunications and air transport, for example, significant deregulation. To that extent these areas are already covered by treaty rules and regulations.

The Green Paper asks questions about whether this should be expanded, how far it should be expanded and whether there is scope for making a general directive for all these areas that would apply general rules and principles or whether we should continue to take a sectoral approach, which has been the way things have operated under the internal market rules.

While I said that the areas of non-economic interest are not really covered by EU competence, they are up to a point in so far as member states try to co-ordinate the provision of services so that there is inter-operability in the area of social welfare, for example, and that entitlements can be carried to other EU member states. There is EU competence but it extends only to co-operation, co-ordination, inter-operability and that sort of area. It does not say what member states have to do or what provisions they have to make for their citizens. That is still entirely within the competence of member states.

The Green Paper is provocative in that sense. It asks whether EU competence should now extend further into these areas in the setting of standards and principles and questions how far it should go. Apart from the existing rules that apply to certain sectors, the treaty does not mention that functioning of services of general interest is a community objective, nor does it assign any particular specific or positive powers to the community. This is where the Green Paper asks whether the competence of the community should go further in this area.

Perhaps I should go into a little more detail on some of the specific sections of the Green Paper because perhaps in trying to simplify it I have been too brief and not done justice to the Green Paper. If the committee does not object I will refer to the summary note which we have provided already. I would like to read out a couple of paragraphs that are pertinent to a summary-type discussion. As the Green Paper notes, the European Union has always recognised different cultural traditions, history and geographical conditions in each of the member states, and this has been reflected in the principle of subsidiarity. It goes on to state:

The EU respects the diversity of the roles of different authorities, whether they are national, regional or local, in guaranteeing access to their citizens to, among other things, high quality services of general interest. This diversity explains the various degrees of community involvement and actions and the use of different instruments. In terms of subsidiarity the community recognises that member states, through their respective agencies, are responsible for the organisation, financing and monitoring of services of general interest. However, the community has competencies in areas that relate to services of general interest. Such areas include the internal market, competition, state aid, trans-European networks and economic and social cohesion.

However, the Green Paper says that there is some confusion and misapprehension on the division of tasks and powers in the area of services of general interest between the community and member states. It is in the context of that uncertainty that the Green Paper asks all the questions.

A suggestion in the Green Paper is to question whether there is an argument for moving towards a community concept of services of general interest. We have all heard of the concept of a European social model, and the Green Paper, in some respects, tries to provoke discussion on what the European social model should be. I should like to quote from the summary note. It states:

This particular section of the Green Paper highlights the common elements existing in community legislation that can be drawn on or that could inspire such a definition of a community concept of services of general interest. These common elements would include universal service, quality of service, affordability and continuity.

The Green Paper argues that these are elements that reflect the values and goals of the community, which are designed primarily to ensure that every European citizen has continued access at an affordable price to high quality services.

Under the heading, good governance, organisation, financing and evaluation, the Green Paper points out that at present member states retain considerable freedom to define and enforce public service obligations and organise the provision of services of general interest. This allows member states flexibility and freedom to define the policies that reflect their own priorities and specific circumstances. Member states are also free to impose obligations on the providers of services of general interest as long as these obligations are confined to existing community rules.

On the financing of services of general interest the Green Paper explains that member states have a responsibility to provide such services even in circumstances where it is uneconomical to do so. In the past member states directly provided and financed services of general interest. However, member states have increasingly moved to different models of the provision of such services and opened the market to new service providers. This has led to the use of other forms of financing, such as the creation of specific funds financed by market participants or direct public funding through national budgets with the result that financing of services of general interest has become increasingly transparent. This is still within the entire competence of member states.

Finally, the Green Paper argues for the need for greater evaluation and comparison of the provision of services between the member states. This is perhaps an area of least controversy in the Green Paper in that evaluation and comparison, or benchmarking, between different member states is always a useful exercise to see where one is vis-à-vis others, and whether one is providing services to the best possible extent and the best possible standards. I do not know whether I have done justice to the Green Paper because it is an extremely complex and interesting area of debate and the debate will run for some time. It is interesting that the Commission has set an early deadline. I am not sure whether when the Commission has received all the views it will move to produce more proposals or suggestions for legislation.

Deputy Ring

It may be a Green Paper but I have a red face because, to be honest, I do not understand it. I can see now why people have lost interest in politics and in the European Union if this is the kind of gobbledygook the Commission sends out. An interpreter is not enough, this requires someone to explain it in simple language.

This week the Minister for Social and Family Affairs, Deputy Coughlan, recruited a person in to the Department to break the regulations down to simple English for applicants. I commend her for that move. That person should start with the European Union, then move to the Department and then to the Civil Service. There are thousands of civil servants spending their days trying to confuse themselves and each other in the European Union, and they have confused me today. They are saying that we have existing services such as An Post with which the Department of Social and Family Affairs has a contract. The European Union would like to see that service put out to private tender. If that happens there will be more services for the cities and no services for the rural areas, which we have to protect.

On what is happening here, I was never an expert on the European Union but this has put me off whatever thoughts I had about entering the European stage this year. I would not be able to spend six days a week there going through this kind of material. I apologise to Ms Brosnan, who did her best with a difficult task. I would hate to see what she had to break down in order to explain this to us. I am sure it was not easy and all I can say is, well done but I am no wiser than I was when I came in.

Deputy O’Connor

The Deputy will have to update himself before next June.

Deputy Ring

I apologise to the officials from the Department.

Chairman

The principle of subsidiarity is important to all EU legislation. Have many submissions been made from within this country about the various service providers in the non-economic areas and has the Government made a submission in this area? I am aware that the Department has a particular remit but has it formulated its thoughts on this? What impact does the Department see that this might have in the area of social and family affairs or is there any particular aspect of that area which this might affect and give cause for concern? That would be of interest to this committee. I have an advantage here in that I did at one time study European law. Has this Green Paper generated much interest at European level or is it just at a bureaucratic level? We talk about the democratic deficit. Is this regenerated at a higher level within the Commission or is there an engine in individual member states driving it?

Mr. Tim Quirke

Services of general interest which are linked to social welfare and protection are clearly a matter for national and regional authorities. However, there is a recognised role for the Community in promoting greater co-operation in terms of policy exchange between member states and that is reflected in the Treaty. There is a specific provision in the Treaty which allows member states, and the Commission, to get involved in policy development and better exchange of information on social protection. There is also a competence in the Treaty under article 42 regarding co-ordination of social security rights of people who move from one state to another.

It is interesting that the Green Paper has recognised that and those are the current arrangements for services in this area. There is no clear call in the Green Paper, or any degree of consensus among member states, for greater harmonisation of social protection systems across Europe. These vary from country to country. Some are more developed than others. For example, we operate on a flat rate system. Other countries such as Germany and France operate with high levels of earnings related systems. It would be a mammoth task for the Community to develop one single model of social protection for all European member states.

From our viewpoint, the Green Paper is not looking at harmonising policy and creating a single framework for the provision of social protection. It is a development we would not see happening. However, where it may be of interest is in the organisation and delivery of social protection systems. These practices vary from state to state. For example, in Ireland we operate through one, single central Government Department. In other European states, they have various institutions delivering various branches of social security and some may even be private sector providers and others public authorities. In that particular area, there may be some application of the principles outlined in the Green Paper.

On the last question as to whether there was any consideration of the Green Paper at any level, within the Council of Europe there is a social policy committee which represents all the Governments from the member states. The social policy committee is involved in exchanging views on policy and in modernising social protection systems across Europe. They had a preliminary examination of the Green Paper and concluded that the treatment of social and social protection policies was not sufficient to be dealt with in the Green Paper to allow it to come to any definitive conclusions. They essentially called on the Commission to address some of these concerns for social protection in terms of delivery and organisation at a further stage during the consultation process. There was not sufficient attention given to it in the context of the present document.

Deputy Finneran

I welcome the representatives from the Departments and thank them for the presentations on the Commission Green Paper. I would not be as pessimistic about it as others have been. It is good to have this debate and, as a Green Paper, it is only a discussion document at this stage. It is important that we not alone discuss matters of economic interest but also of general interest. Irish citizens have improved their lot through directives and decisions that have been made in Europe. Areas of isolation and exclusion that existed for many years have now been corrected due to our involvement in the EU. I see this as a positive, further development of both economic services and general interests.

Mr. Quirke commented how we have a centralised delivery of services which is different to many other European states. In Ireland, various Governments tinkered with it over the years by giving authority back to local authorities and other bodies. Some would say there are too many bodies dealing with the public. However, no decision has been made on where real authority has gone. Decentralisation has simply meant relocation of Departments and services. There has never been decentralisation in the true sense of the word where central power is given to the regions. We have different authorities who report and all the rest of it. However, the bottom line is that the Department of Finance has held on to everything. If that issue were to be debated and discussed, it would be a good thing.

I am concerned about services that are not of an economic interest. There is debate in Europe on whether the population should pay for domestic water supply. The idea has been floated here too. We need to be concerned about that issue. In this debate, I have no doubt that it is necessary to have a general understanding about payment for services. We are unique in that the domestic water supply service is free. That is not the case in other member states. The free supply of domestic water could be undermined and removed because of this debate on general interests.

Many of the advances that have taken place here have been as a result of European activity. From a social welfare perspective, and in the area of women's rights, Europe has played an enormous and positive role. I hope it will continue to do so. However, I hope that other committees and Departments will have an input into the debate on this Green Paper. There are implications such as those concerning the postal service, as referred to by Deputy Ring. The postal services have been under threat for some time for various reasons. An Post is inefficient. It is not competing favourably on an international basis and has lost large sections of its market. However, the only answer given is to close rural post offices. That is not the way to approach the financial problems of An Post.

Deputy Crawford

I thank the personnel from the two Departments for their presentations. We were concerned that if the Green Paper was let through without the committee receiving some advice on it, we could be accused afterwards of not playing a role in this development. That is the reason we wanted information on the Green Paper. It is valuable, even if it is technical, to have this discussion at this stage. So often we hear people claiming in a pass-the-buck attitude that it was the EU that decided on such matters. It is important that we go through the detail of Green Papers such as this before the proposals they contain are put into effect. We can minimise any pressures they might bring on.

A former church minister I know, recently referred to the health services as being less helpful today than they were 42 years ago. I am not sure if the EU has done much for us in that context. He also said that many people feel Sunday shopping is part of the European culture and that it cannot therefore be avoided. A colleague of his was amazed that in France shops do not open on Sunday, while in Ireland they do because of a perceived EU regulation. There is a myth put about that Europe is the big bad boy who forces us to do things against our will.

There was a reference in the presentation to the financing of services of general interest. The Green Paper explains that "member states have the responsibility to provide such services even in circumstances in which it is uneconomical to do so." I cannot help thinking of two services in my own Border constituency of Cavan-Monaghan. All sorts of excuses are made regarding the services at Monaghan General Hospital, which, in effect, has been closed down as a result of the attitude of the State. If this Green Paper results in legislation, is there a chance of aid for the more isolated areas which at present are left without services?

An Post, which was mentioned by Deputy Ring, has introduced a special business post at a discount rate. Funnily enough, County Monaghan is one of the areas where no such service is supplied. There are 24 service points throughout the country, and An Post has excluded four counties - Monaghan, Leitrim, Carlow and Offaly - even though Monaghan borders on Northern Ireland, with its greatly different prices.

These are very worrying issues for those of us living in more isolated areas. We are being told all the time that it is for economic reasons, because of EU legislation, that cross-subsidisation is not allowed, yet in the Green Paper it is stated clearly - as I read it - that it should be possible to provide services to areas even if it is uneconomic to do so.

As a person who spent quite a bit of time in the agri-sector in Europe, I welcome the debate. The EC has done much for us. Despite what I said about the health services, as a country we have gained enormously since the mid-1970s. It is important that we do not allow ourselves to be tied to legislation that would impose on us something we do not want. To that end today's discussion is helpful.

Deputy Connolly

I thank the officials for the presentation. If all this talk on Europe leads to improvement in services, that is what we are here for. We should be looking at areas of best practice.

An area which concerns me is the Port Tunnel and its development costs, when we have people from Spain telling us it can be done for a fraction of that cost. Such issues are very real. We must start to look at best practice and cost factors right across Europe. No matter what major contracts we now apply for, they must be advertised in European journals. I am amazed that if such contracts are widely advertised, a quote which wins a contract in Spain or in another European country does not seem to apply in Ireland. I hope some major benefits will flow from this type of situation, and widen the debate. I await developments.

Deputy S. Ryan

I apologise for being late and I thank the delegation for the presentation on a complicated subject. As Deputy Finneran said earlier, the issue is one we cannot cast aside. We must become involved in it and make an impact on its development. Without Europe, much of the legislation on workers' rights, women's rights and equality would not have come to pass because of differences of government priorities. Without the pressure emanating from Europe, even our own governments over the years would not have deemed some of those rights to be priorities.

It is therefore vitally important that we look at the current position. The concept of universal services needs to be developed. The Green Paper requires further development and discussion. The provision of universal services should be high on our agenda in order to cater, for example, for the rights of the disabled and the elderly. Such rights have not been properly prioritised. One could say that every country makes its own decisions on priorities, but if we do not have the concept of universal rights to services, that opens up another sphere of government. That should be clearly addressed in our presentation, and rights should apply to all, irrespective of what political clout people have. We are talking of a country which is supposed to cherish every citizen equally. A recommendation I would make to Miss Benson, Mr. Quirke and his team, is that the concept of universal rights should be developed as part of a presentation by our Government to Europe.

Senator Cummins

It is impossible to develop a common European framework to ensure that we fall in with all policies in EU states. As the document stated, it is an attempt to impose a "one size fits all" solution on member states regardless of our different circumstances. On services of general interest, the EU must continue to adopt legislation on a sectoral basis. What the Green Paper attempts to do is impossible.

Chairman

What timescale is envisaged? I know that submissions must be in by next week. Is the Green Paper then developed into a White Paper, a formulation for directive? There must be a significant timescale envisaged, seeing that there could well be a multi-sectoral approach to SGIs for example. Eventually, subsidiarity, for example, will have to be looked at. The whole area is huge and complex, as Ms Benson made clear. I believe she understated its complexity. My colleagues here today have reflected that diversity by indicating the various areas that may well come in for a universal approach in relation to provision, and asking if there are sectoral interests that need to be examined separately. It is very complex, and that is why the delegation was asked to make its presentation. Its members might like to comment on any other aspects raised by the committee members.

Ms Benson

With reference to the Chairman's question on the timescale, and what happens next, I cannot say what will happen regarding the Green Paper. The Chairman has rightly pointed to the complexity of the issue and its different levels and layers, and because it also impinges on whatever happens in the Convention on the Future of Europe, and whether there will be a new Treaty-based provision to underpin this whole sector, what happens to the Green Paper will depend on all that. From my knowledge of previous Green Papers, what usually happens is that the paper is published, there is a consultation period and views are received. After a period of two or three months, the Commission is in a position to draft an action plan - that is another name for a White Paper - that will contain proposals which may then go into specific councils or working groups, depending on whatever types of proposals emanate from that action plan. However, it could be anything, including a code of practice, directives, legislation, general frameworks, or a communication from the Commission to give guidance. A range of different instruments could emerge from that in legislative and non-legislative areas. That refers to the timing, and I know that it is not a satisfactory answer, but it reflects the reality of the process.

I cannot answer or comment on everything that I have heard here, for, as was rightly said, the comments of the Deputies and Senators reflect the complexity of the issue and also the intensely political nature of the topic, namely, the division of competences between the European Union and member states, something which goes to the very core of democracy at national and European level. That is the fundamental issue underpinning this document. One can argue about whether we should have a sectoral approach or universal standards. It might be useful in some areas and less so in others. From our Department's point of view, based on consultations within it, different models work in different circumstances. A monopoly may be appropriate in some situations while deregulation and liberalisation may be appropriate in others. We very much take a pragmatic view when examining what is best for the consumer, the citizen, the taxpayer and the Exchequer. We try to come up with the best proposal for Ministers and the Government. I valued the comments made by Deputies and Senators, for they have confirmed our view that the area is both interesting and tricky.

Deputy Ring

Is the Parliament examining how existing services throughout Europe are being carried through? Ms Benson made a very valid point that some state agencies, in areas such as social welfare, have a monopoly. I am open to correction in what I say, but for every social welfare service currently provided, including carer's benefit or allowance and whatever other scheme one applies for, there are waiting lists of ten or 15 weeks. If, in other parts of Europe, some of that is in the private sector, how is it working? One very simple action which could be taken on a trial basis would be free travel. It would be very simple to implement free travel throughout Europe, and our citizens should have it if we are serious about the European scene. If someone has a free travel pass, he or she should be able to use it in any part of England or Germany. However, is the implementation of specific services being examined? I know that Mr. Quirke said that this paper has no real bearing on social welfare or our committee in that we have no common social welfare scheme across Europe. Every country looks after its own. Have we examined how existing schemes are working here and other parts of Europe and how we are doing compared to other member states?

Deputy S. Ryan

I need clarification of where the Government goes after 15 September. Who is drawing up our recommendations? Will it be each Department, or Ms Benson? Are all the Departments involved in this?

Ms Benson

Yes.

Deputy S. Ryan

I do not know whether all committees have had an opportunity to make a presentation. However, in that context, I would appreciate an opportunity to see the Government submission.

Ms Benson

I am in the process of co-ordinating an interdepartmental committee, of which Mr. Quirke's Department is part, along with several other Departments. I have the job of collating the views of all the Departments, and it will be up to the Government Ministers to decide what views ultimately go forward. On the committee system in the Oireachtas, all committees have received a copy of the Green Paper. We have received invitations from other committees to try to be helpful in the process. It is therefore up to committees to send their views either directly to the Commission or to us. We can also collect views as the process goes forward. Mr. Chairman, you asked whether other Governments had made views known. We know that the French Government is particularly interested in this, as are several French organisations. Mr. Egan checked the Commission's website this morning, and it appears that the submissions from the French Government and a committee of the French National Assembly are on it already - I am not aware which. However, if it is of interest to this committee, members could look at the website and see what their opposite numbers in France are saying.

Deputy S. Ryan

I would like to know what our Government will eventually say.

Ms Benson

We can make that available to the committee, assuming the Government decides to submit views on the subject.

Chairman

I see the officials are taking notes of members' observations, and I hope they feed into the process and that cognisance is taken of some of the issues raised here by my colleagues. This complex and difficult topic is obviously of interest and concern. Clearly there are time constraints to work to in this regard, and I thank the delegation for taking time out to make the presentation today and take questions on the chin. I genuinely hope that the officials have taken some aspects of the matters raised by my colleagues here on board. While we will not be making a formal presentation on our observations, we hope that the delegation will take account of them in formulations at departmental and interdepartmental level.

Deputy Ring raised an issue somewhat outside those matters, but I am sure Mr. Quirke, who has had to face the Deputy before, will appreciate that he has continually been raising it, at strictly departmental level, over several meetings here with him.

We will now meet officials from the Department of Justice, Equality and Law Reform on another topic.

Sitting suspended at 3.09 p.m. and resumed at 3.10 p.m.