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Speech
José Manuel Durão Barroso at
the Brussels launch of Ladies and gentlemen, I am delighted to be speaking at the launch of your Scorecard, for the third consecutive year. Europe needs friends like the Centre for European Reform, who criticise frankly and constructively. The title of the Scorecard asks - "Will globalisation leave Europe stranded?" My answer is simple. No, it will not, if we respond in the right way. If we swim against the tide of globalisation, we will drown. But if we ride its waves we can harness its power. That is what the renewed Lisbon Strategy for Growth and Jobs is about. A Europe equipped to face the future. A more prosperous, greener and more equitable Europe. The Strategy is beginning to deliver results. Three years ago, Europe's economy was stagnating. Low growth. Businesses tied up in red tape. More and more lives destroyed by long-term unemployment. EU GDP growth was 2.9% in 2006 and is projected to remain around that value in 2007. Many of Europe's businesses are blossoming again. The drive for better regulation is paying off at both EU and national level. The latest Innovation Scoreboard shows the gap with the US beginning to close. Europe created three million jobs in 2006. Unemployment is down to around 7.5 %. That is still too high. But it is the lowest figure in more than a decade. Of course, the renewed Lisbon Strategy is not the only reason for the healthier outlook. But it is one reason. That is a fact that sometimes gets lost. It is only natural that national governments tend to present things in a national perspective. But as the Lisbon Scorecard says: "there is hardly a European country that is not studying the Danish model of flexicurity, the Finnish success in higher education or the pros and cons of UK style utility liberalisation." More examples could be added - the French "pôles de compétitivite" the Dutch standard cost model, tax reforms in some new Member States. I believe that the renewed, more focused Lisbon Strategy has helped to create a dynamic of mutual learning. It is starting to create an internal market in ideas. The Commission is the catalyst for that. We must now take advantage of the upturn. Not to relax. But to speed up. At a time of high growth Europe can reform for the future with determination, but calmly and with confidence. That is more effective and less divisive than desperate measures with the wolf at the door. Indeed, there are signs in many Member States that more and more people are seeing that reform works. That clinging to the past does not. Your Lisbon Scorecard is an excellent stimulus for debate. Ranking Member States is always a good way to simulate debate. And it is fine for a think-tank holding the EU to account from the outside. But the Commission is a partner for Member States. A critical partner where necessary. But also a loyal partner. So we do not talk about heroes and villains. But we perfectly understand that a Center like yours can do it. I am pleased that on opening markets and better regulation the Commission is called a "hero". We've been called many things by UK organisations. "Hero" is unusual. I rather like the sound of it. The Scorecard's overall assessment of the results of the renewed Lisbon Strategy is again a C grade. It is not the Commission's place to grade to a child for whom we are one of the parents. But I believe implementation has moved forward significantly since I stood before you last year. In a moment, I will explain why in more detail. Many Member States have started to implement far-reaching reforms. The Commission has put forward country specific recommendations so that Member States can agree collectively on what they need to do individually. Member States have all responded positively to this move. The Council is about to adopt the recommendations. European and national parliaments are beginning to play a stronger role. They invited me last month to speak to their third joint meeting on the renewed Strategy. I called for "a parliamentary movement for change". We now need to extend this dynamic to include more stakeholders. Businesses, of course, but also trade unions and civil society. Above all, we need to convince citizens to come on board. Because in democracies, citizens decide. We need to do much more to explain the benefits of economic reform. We need to fight the perception in some quarters that the renewed Lisbon Strategy aims to reduce social protection. That perception is wrong. How do we change it? By showing how economic reform is about improving everyday lives. And by putting forward a positive vision of what Europe could be. Too often, we talk about Lisbon in terms of abstract policies. But Lisbon is about people. Jobs, pensions, access to healthcare, children's education. The unemployed school leaver who cannot get on the career ladder. The mother who wants to return to work but cannot find affordable childcare. The older worker who has been made redundant. As the Scorecard says: "pessimism makes Europeans fearful of change". That is why we need a positive vision. This does not mean glossing over tough decisions. It means showing that it is perfectly possible to combine economic efficiency, social justice and environmental protection. We do not need to look far for proof. Several of our Member States are already doing just that. We cannot present a positive vision of Lisbon unless we also present a positive vision of Europe. It's achievements, its potential, how it can do even better in the future. This year, as the fiftieth anniversary of the Treaty of Rome, is a perfect opportunity to do that The Scorecard is wrong to say social and environmental issues have been "packed off into separate strategies". The Energy Package we have proposed is very much part of the renewed Lisbon Strategy. So is our recent communication on social protection and social inclusion. So is the European Globalisation Adjustment Fund. And let us not forget the structural funds. From 2007 to 2013 they will provide 300 billion euros, much of it earmarked for Lisbon objectives. To help turn the people of disadvantaged regions from potential losers from globalisation into real winners. The Scorecard divides its analysis into five main areas. Innovation, liberalisation, enterprise, employment and sustainable development. For reforms in those micro-economic and employment areas to work, they need to be underpinned by a stable macro-economic framework. This is especially true for the euro area. Some Member States who have had problems - not least France, Germany and Italy - have now begun to put policies in place to turn things round. They are not out of the woods. And others are still deep in the forest - Hungary is the most obvious example. But all of them are trying hard to find their way out into macro-economic daylight. That is good news. Because you cannot deal with the budgetary implications of ageing populations without financial stability. It would be like trying to defuse a bomb with both hands tied together. There has been progress over the last year on innovation. As I have said, the latest EU Innovation Scoreboard shows the gap between the US and Europe beginning to close. But the gap is still far too wide. And so is the digital divide within Europe. There too many "digital have-nots". That is a modern form of social exclusion. Europe needs to invest much more in R&D. Our target of raising R&D spending to 3% of GDP by 2010 is for Europe as a whole, not for individual Member States. Most Member States have set their own targets. Reaching the 3% target for R&D investment is a prerequisite for boosting innovation. But it is not a panacea. It must be the right investment. That means setting the right priorities. It means reinforcing higher education systems and enhancing cooperation between universities and businesses. It means an EU-wide patent system. It means more competition - nothing stimulates innovation like the hot breath of competition on a company's back. There are grounds for qualified optimism. Some Member States - the Nordic countries in particular - are already world leaders in R&D and innovation. There are stronger technology and research strategies emerging in the UK, France, Spain, the Netherlands, Portugal, Ireland and Estonia, to name just some. Germany continues to be a strong R&D and innovation performer. The Commission has now put a concrete proposal for the European Institute of Technology on the table. Let me move on to the second area - "liberalisation". Telecoms has been a big success story for Europe. But we must make sure that consumers benefit fully. That is why we have proposed limits on roaming charges. We will be proposing this summer a reform of the European regulatory framework. You cannot create European energy champions by favouring incumbents and blocking mergers on protectionist grounds. That's like trying to make a football team fit for the Champions League by giving it a three goal start in national league games. And a referee who lets it break the rules. The Commission believes full ownership unbundling is an important part of the energy policy mix. Important for security of supply as well as for competitiveness Not all Member States agree - though they do recognise we need stronger controls against conflicts of interest. That debate will continue at the European Council later this week. On services, I want to look forward with resolve, not look back in anger. The Services Directive is perhaps not ideal. But it is a major step forward that offers huge possibilities for business and for employment. We now need to implement it vigorously. We also need to continue to use the Lisbon Strategy to open services markets. This is covered in our proposed recommendations for several Member States. Meanwhile, the implementation of the Financial Services Action Plan is transforming capital markets. Enterprise is the third area covered in the Scorecard. Again Europe has made big steps forward. Again, we are not there yet. Start-ups still take too long and cost too much in some Member States. Businesses cannot always get access to capital. But pretty much everywhere, the direction is the right one. The Commission's commitment to improving regulation has been absolute. We tore up the manual of internal procedures and started again. Systematic consultation and impact assessment are now undertaken for every proposal. Some Member States take an equally rigorous approach. The Netherlands is a pioneer. Others are following its example. That spreading of national best practice is an example of Lisbon at work. We now need a similar commitment by all Member States. That is why we have established an EU level target for cutting administrative costs by 25% by 2012. We will persevere with efforts to persuade Member States to set similar targets at national level. Because persevering often works. For example, Member States have finally reduced backlogs in transposing EU legislation to below the 1.5% target. They now need to reduce the number of infringement cases by improving implementation. Let me move on now to employment, the most important issue of all. Raising employment rates is key to improving quality of life. It is key to growth. And it is key to responding to the challenge of ageing populations. Like the R&D target, the 70% target for employment rate is a collective target for the EU, not one for individual Member States. We currently stand at around 63.8%. There are promising signs. Employment is up and unemployment down. Employment of women and older workers is rising. But let us be honest. There has so far been nowhere near enough action to reform labour markets. Governments and stakeholders need to recognise some tough realities. One, we cannot protect uncompetitive jobs. Denying companies flexibility to adapt the size of their workforce can lead quickly to company failure. In other words, to no workforce at all and more people in the dole queue. Two, to attract more people into the labour market, we need the right tax and benefit systems. Three, there needs to be flexibility for workers too - not just for employers. Work-life balance, parental leave, career breaks, childcare - enlightened employers offer these things. Four, the modern world changes fast - skills need to change with it. Lifelong learning cannot be just a feelgood slogan. It has to be a reality. It has to be properly funded, both by governments and by employers. Five, we cannot just leave those who might lose their jobs to sink or swim. That is a failure of duty. It is socially dangerous. And it is political suicide. Those who suffer from the short-term effects of globalisation need training, help to find new opportunities and a decent level of financial support while they do it. It is not a matter of choosing between flexibility and security. We need both. Real security for workers means giving employers the flexibility to compete successfully. Real flexibility for employers means giving people security. Not by futile attempts to protect specific jobs. But by giving people the incentive, the opportunity and the mindset to learn new skills throughout their lifetime. The final area identified in the Scorecard is sustainable development. Have no doubt about the Commission's commitment. The future of the planet cannot be a hostage to any industrial lobby. Or to any Member State or third country that will not take its responsibilities. That is our message and we have backed it up with action. We have demonstrated it with the energy package. We will keep up the pressure on Member States to accept that the EU should fix unilateral and binding targets for emissions reductions and for renewables. We've demonstrated it on car emissions. I do not understand the suggestions from some quarters that we have been weak on this. As I have said before about the Services Directive, we have to put forward policies that the Parliament and Council can adopt, otherwise they are just empty words. We will keep arguing that taking the lead on energy efficiency and emissions reduction will make EU industry more competitive and give us a strong lever to pressurise other parts of the world. Before I conclude, a reminder that the Integrated Guidelines which provide the framework for National Reform Programmes will be reviewed in 2008. The Commission will make a proposal for the updated Guidelines at around the same time as presenting its Annual Progress Report at the turn of the year. We will not be proposing a revolution. The Guidelines are working. But some updating and fine-tuning will doubtless be necessary. We will also be reviewing the Community Lisbon Programme. I want the revised Programme to set out clearly how the EU level contributes to Growth and Jobs, for example through internal market, competition, environment and trade policy. I want it to identify key challenges and include clear policy priorities. In other words, I see it as the European counterpart to National Reform Programmes. I know we can rely on the Centre for European Reform to be active and constructive in the debates that lie ahead. In the meantime, let me conclude. The Scorecard says "the Lisbon Agenda is far from being defunct". I prefer to say it is alive and kicking. I think that verdict is fully justified by the facts. But the facts do not justify complacency. We are talking about a job started. Not a job done. Thank you
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