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JOINT COMMITTEE ON EUROPEAN AFFAIRS (Sub-Committee on European Scrutiny) díospóireacht -
Wednesday, 11 May 2005

Scrutiny of EU Proposals.

Items 1.1 and 1.2 on today's agenda are proposed for referral to sectoral committees for further scrutiny. Item 1.1 is COM (2005) 119, a proposal for a decision of the European Parliament and the European Council concerning the seventh framework programme of the European Community for research, technological development and demonstration activities for the period 2007-13, known as Building the Europe of Knowledge. Item 1.1 also contains a proposal for a Council decision concerning the seventh framework programme of the European Atomic Energy Community, EURATOM, for nuclear research and training activities for the period 2007-11. The lead Department for these proposals is the Department of Enterprise, Trade and Employment.

The proposed annual budget for the seventh research framework programme is over €12 billion. The total budget over the period of the next financial perspective, 2007-13, would exceed €73 billion. The proposed programme would build on the existing one, through which the Department outlines Ireland has received support amounting to €100 million.

The financing of projects under the proposed measure would arise through a number of methods. Some aid would be channelled directly while other assistance would come thanks to loan guarantees. The Commission's central argument for the adoption of the proposed measure is that knowledge is at the core of the Lisbon Agenda and underpins all its elements. It also contends movement is required if the goal of creating a European research area, built around EU research efforts amounting to 3% of EU GDP, is to be achieved.

The programme would encompass areas of life relating to technological developments, with elements targeted at health, energy, transport and security against terrorism. Given its broad scope and as a proposal for a framework decision, it is clearly not possible for the Commission, in certain instances, to go beyond generalities in the documentation presented. During discussions at working group level it is likely that a clearer picture will emerge with respect to references to EU research contributing to the development of new norms and standards to establish an appropriate legislative framework for new medical technologies such as regenerative medicine.

Some further thought may also have to be given to the thinking behind the relatively small amount provisionally assigned to SMEs in the programme, given the expectation that this sector of the economy will play a significant role in any advancing of the Lisbon Agenda. The selection and promotion of regional centres of technology in Europe and the funding of space activities are issues that would require further elaboration. It is, therefore, proposed that this significant proposal from the Commission be referred for further scrutiny to the Joint Committee on Enterprise and Small Business and that it be forwarded to the Joint Committee on European Affairs for information in the context of its ongoing interest in the Lisbon Agenda. Is that agreed? Agreed.

Item 1.2 is COM (2005) 141 which consists of integrated guidelines for growth and jobs for the period 2005-08, including a Commission recommendation on the broad guidelines for the economic policies of member states and the Community, as well as a proposal for a Council decision on guidelines for the employment policies of member states. The lead Department is the Department of the Taoiseach.

In May 2004 the sub-committee considered the previous proposal from the Commission with respect to employment policies, COM (2004) 239, when it was referred for further scrutiny, given the significance of the issues involved. The memorandum to the two documents gives the Commission's overview of the economic situation across the European Union and highlights that average annual growth in some member states remained below 1% during the period 2000-03. However, it is also suggested that a combination of the right economic circumstances will contribute to an improvement in domestic demand.

The guidelines aim to provide a stable and coherent framework to make it possible to implement measures to rectify the shortcomings highlighted in the text. The guidelines cover three areas: macroeconomic, microeconomic and employment. They are fairly general but tend to focus on technological development, continuous training and other elements linked to the Lisbon Agenda. However, they would be incorporated into the national employment policies of the member states, including Ireland.

It is proposed that the proposed measure, the adoption of which would have direct implications for Ireland, other member states and neighbouring markets, be referred for further scrutiny to the Joint Committee on Enterprise and Small Business. Is that agreed? Agreed.

As no Title IV measures have been received for today's meeting, I will move to the third item, namely, common foreign and security policy measures. One such measure is to be dealt with at today's meeting, Council Common Position 2005/329/CFSP of 25 April 2005 on the 2005 review conference of states and parties to the treaty on the non-proliferation of nuclear weapons. The lead Department is the Department of Foreign Affairs and the Department of the Environment, Heritage and Local Government is also involved.

In advance of the seventh review conference of the treaty on the non-proliferation of nuclear weapons, NPT, which began on 2 May last and continues until 27 May, opening sessions of which I attended, this Common Position was adopted with the objective of providing co-ordination of the EU position. In particular, this relates to efforts to preserve and strengthen the NPT. It is proposed to note this measure. Is that agreed? Agreed.

The following proposal is proposed for deferral, namely, COM (2005) 106, a proposal for a Council regulation amending Regulation (EC) No. 297/95 on fees payable to the European Medicines Agency, EMEA. The lead Department is the Department of Health and Children and the Department of Agriculture and Food is also involved. In October 2003 and again in April 2004 the committee considered proposals relating to the establishment of the EMEA. This proposal follows from the creation of the agency and its changing role since then, and in particular the increasing part of the EMEA costs associated with the management of a medical product throughout its life cycle.

As members will have noted, it is argued in the proposal that the current fee structure is not appropriate to the tasks undertaken and to the associated costs. The Commission is therefore seeking approval for changes to the fee structure of the EMEA. In some instances this would result in increases and in other cases there would be no change. It is also proposed that the EMEA would have additional flexibility to reduce fees when required.

The Department's note indicates that it supports the principle that the EMEA should have sufficient resources to carry out its functions effectively. The Department was, in addition, requested to outline its views on the changes proposed in the fee structure and to indicate the consultations, if any, it has carried out on this matter. It is proposed that consideration of this proposal be deferred and that the Department be requested to provide additional information. Is that agreed? Agreed.

The next set of proposals on our agenda are those which it is proposed do not warrant further scrutiny. COM (2005) 93 is a proposal for a Council decision on a Community position regarding a draft decision of the joint committee established under the agreement between the European Community and its member states of the one part and the Swiss Confederation of the other on the free movement of persons. The lead Department is the Department of Health and Children and the Department of Social and Family Affairs is also involved.

This proposal seeks approval for the amendment of the annex to take account of recent changes to EU and national regulations. In particular, these relate to changes in the national rules of France, Portugal and Germany, as well as the decisions that concern the European health insurance card. It is proposed that the proposal does not warrant further scrutiny. Is that agreed? Agreed.

COM (2005) 94 is a Green Paper entitled Confronting Demographic Change: A New Solidarity Between The Generations. The lead Department is the Department of Social and Family Affairs and the Departments of Finance, Enterprise, Trade and Employment and Health and Children are also involved. The Commission through this Green Paper is seeking to stimulate a debate on some of the challenges facing Europe in regard to demographic movements. While it concedes that many of the issues it raises in its paper are within the exclusive competence of the member states, the Commission contends that they are issues of common interest. Therefore, one of the fundamental questions posed in the paper is whether this is an appropriate matter for discussion at this level.

Members will have noted that the paper contains some stark statistics and conclusions on the likely consequences arising from the demographic trends highlighted. For example, it is outlined that: "the fertility rate everywhere is below the threshold needed to renew the population (around 2.1 children per woman)", and while immigration from outside the EU could help to mitigate the effects of the falling population, "it is not enough on its own to solve the problems associated with ageing". The paper suggests that the answer lies in economic reforms.

In particular, the paper claims to identify three basic demographic trends: continuing increases in longevity as a result of considerable progress made in health care and quality of life; the continuing growth in the number of workers over 60; and continuing low birth rates. The paper then suggests that the low fertility rates are as a result of obstacles to private choices such as late access to employment, job instability, expensive housing and lack of incentives such as family benefits, parental leave, child care and equal pay. The Commission seeks submissions by September 2005 concerning the questions it has posed around the issues highlighted in the paper.

It is proposed that the Green Paper be forwarded to the Joint Committee on Social and Family Affairs for information and consideration. That committee may also wish in this context to refer to another recent paper from the Commission that concerned managing economic migration, COM (2004) 811. Is that agreed? Agreed.

It is ironic that 20 years ago we were concerned about population explosion whereas now we are concerned about a decline.

That is correct. COM (2005) 114 is a proposal for a Council regulation amending Regulation (EC) No. 827/2004 concerning the prohibition of imports of Atlantic big-eye tuna from Cambodia, Equatorial Guinea and Sierra Leone, and repealing Regulation (EC) No. 826/2004 prohibiting imports of blue fin tuna from Equatorial Guinea and Sierra Leone and Regulation (EC) No. 828/2004 prohibiting imports of swordfish from Sierra Leone. The lead Department is the Department of Communications Marine and Natural Resources and no other Departments are involved.

A number of regulations are in place that prohibit the importation of certain species of fish from certain countries. The prohibitions arise in this instance from the Community being a party to the international convention for the conservation of Atlantic tuna, ICCAT, and concern illegal fishing activities that were taking place with respect to tuna around Equatorial Guinea, Sierra Leone and Cambodia. I understand that at the November 2004 meeting of ICCAT, efforts by the countries concerned by these prohibitions to address related issues were acknowledged and recommendations lifting the trade measures were adopted.

This proposal seeks to give effect to these recommendations in Community legislation. It is proposed that the proposal does not warrant further scrutiny. Is that agreed? Agreed.

COM (2005) 121 is a proposal for a decision of the European Parliament and of the Council establishing a competitiveness and innovation framework programme 2007-13. The lead Department is the Department of Enterprise, Trade and Employment and the Department of Communications, Marine and Natural Resources and the Department of the Environment, Heritage and Local Government are also involved.

Through this proposal the Commission is seeking to bring together three separate programmes concerning competitiveness and innovation. The Commission outlines in its memorandum to the proposed measure that the consolidation of the programmes would provide an overarching legal basis for action in these areas and would reduce the number of multiple funding schemes and instruments. The aim is, therefore, to improve the visibility, effectiveness and synergy of its actions.

These are existing programmes that have been considered by the committee in the context of previous proposals from the Commission. However, the budgets, in general, would be increases on the existing ones. The final figures will be determined following agreement on the broader financial perspective and it is therefore likely there will be some downward pressure on the current figures. The programmes would operate, inter alia, through loan guarantees, the provision of information and support, and the development of networks.

It is proposed that the proposal does not currently warrant further scrutiny but that it be forwarded for information to the Joint Committee on Enterprise and Small Business, particularly in the context of the innovations in the proposed measure in regard to the supply of seed and early stage capital for innovative start-ups and young companies, such as the supply of development equity. Is that agreed? Agreed.

Item 5.5, COM (2005) 127, is a proposal for a Council decision amending and extending the Council decision of 17 December 2001 establishing an exchange, assistance and training programme for the protection of the euro against counterfeiting, the Pericles programme, as well as a proposal for a Council decision extending to the non-participating member states the application of the decision arising from the first proposal. The Department of Finance will lead on this and the Department of Justice, Equality and Law Reform will also be involved.

The Pericles programme aims to assist member states in the protection against counterfeiting of the euro through assistance, exchanges and training. Such measures include seminars, workshops and conferences. The Commission seeks approval through this proposal for the continuation of the programme for a further four years with the same budget of €1 million per annum. Proposed changes to the programme include a renewed focus on training and a widening of the sectors involved to include prosecutors and technical staff.

The adoption of the second decision proposed by the Commission would see the programme extended to member states where the euro is not the official currency. The Commission argues that this is required to ensure uniform provision is made to protect the euro across the EU. It is proposed that the proposal does not warrant further scrutiny. Is that agreed? Agreed.

Item 5.6, COM (2005) 140, is a proposal to extend the period allowing Romania to grant state aid in respect of steel products for restructuring purposes for a further eight years from 1 January 1998. The Department of Foreign Affairs will lead on this and the Department of Enterprise, Trade and Employment will also be involved.

According to the EU agreement with Romania, that country could grant state aid to the steel sector for a period of five years after the agreement's entry into force. I understand Romania requested an extension of this period and this proposal follows from the provisional application of this request. The extension of the period to eight years is conditional on the restructuring of the Romanian steel sector. The Department's note underlines that the adoption of the measure would have no economic impact on Ireland. It is proposed that the proposal does not warrant further scrutiny. Is that agreed? Agreed.

Item 5.7, COM (2005) 160, is a proposal to terminate a partial review initiated to examine the effects of enlargement on imports of silicon originating in the People's Republic of China. The Department of Enterprise, Trade and Employment will lead on this proposal. The Commission indicates it undertook a review of the silicon market to determine if additional measures were required following the addition of ten new member states. The Commission has determined that no new measures are required and it proposes that the review be terminated. It is proposed that the proposal does not warrant further scrutiny. Is that agreed? Agreed.

Item 5.8, COM (2005) 173, is a proposal for a Council regulation regarding the partial interim review of the anti-dumping measures applicable to imports of silicon carbide originating in Ukraine. The Department of Enterprise, Trade and Employment will lead on this proposal. The Commission's review concludes the situation in this market has not fundamentally changed and is seeking, through the proposal, to terminate the review. It is proposed that the proposal does not warrant further scrutiny. Is that agreed? Agreed.

Item 5.9, SEC (2005) 548, is a proposal for a decision of the European Parliament and the Council on the mobilisation of the flexibility instrument in favour of the rehabilitation and reconstruction assistance to tsunami-affected countries, according to point 24 of the Inter-Institutional Agreement of 6 May 1999, as well as a preliminary draft amending budget No. 3 to the budget for 2005, that is, the general statement of revenue and expenditure, section 111 — Commission. The Department of Enterprise, Trade and Employment will lead on this proposal.

I understand that the Commission indicated in early January 2005 that it would advance a proposal to provide additional assistance to countries most affected by the tsunami. The Department's note indicates that, at that time, the Council welcomed the initiative that would see assistance directed mainly at Indonesia, Sri Lanka and the Maldives. The total amount of additional assistance would amount to €350 million, with €170 million allocated during 2005 and €180 million during 2006. The assistance would be for rehabilitation and reconstruction projects. A sum of €98 million of the assistance during 2005, under the current proposal, would be sourced through the flexibility mechanism. It is also outlined that €150 million could be similarly sourced in 2006.

The aspect of the proposal that relates to the mobilisation of the flexibility mechanism is likely to be the subject of much debate, as it is envisaged as being operational over two years. The memorandum to the proposal outlines that €123 million of EU assistance has been made available as emergency aid related to the tsunami under the 2005 budget. In the context of the clear need for assistance as outlined in the memorandum and the Council's welcoming of the proposal in principle, it is proposed that the proposal does not currently warrant further scrutiny. However, it is also proposed that the Department be requested to keep the committee informed of major developments concerning this proposal in respect of the Commission's proposed use of the flexibility mechanism for two consecutive years. Is that agreed? Agreed.

No adopted measures or early warning notes were received for this meeting. The minutes of the meeting of 28 April 2005 have been circulated. Are they agreed? Agreed. The draft 49th report of the sub-committee was circulated. I propose that the report, as circulated, be laid before both Houses. Is that agreed? Agreed. No correspondence has been received for this meeting. I propose that the next meeting of the sub-committee be held at 9.30 a.m. on Thursday, 2 June 2005. Is that agreed? Agreed.

May I have a copy of the Green Paper on Population Change, COM (2005) 94?

Yes.

The sub-committee adjourned at 10 a.m. until 9.30 a.m. on Thursday, 2 June 2005.

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