Four options in battle over service clause battle

Date: 20/03/1997

By Chris Johnstone

THE heated debate over whether to insert a new clause on public services in the revised EU treaty is set to surface again at the start of next month with member states looking as divided as ever.

The issue of whether a reform of the treaty in this area is needed has become a battleground between Union governments spearheading the move towards greater competition and the privatisation of essential services such as electricity and water, and those wishing to keep them within the public domain.

The former, backed up by European employers' federation UNICE, argue that the proposed changes could be used to block new market-opening measures or roll back existing ones.

But the latter insist that they are only looking for a modest amendment to the treaty to reflect the importance of public services across Europe.

Four options are currently jostling for support ahead of an expected early-April discussion of the subject by member state representatives at the Intergovernmental Conference on EU reform.

These include an ambitious Belgian call for a Europe-wide commitment to public service, a French proposal on the same lines which has still to be fully elaborated, a modest European Commission proposition for countries to promote services of general interest and the do-nothing option.

The Belgian and French proposals would both involve changes to European competition rules in a way which critics claim would disrupt the Union's careful balancing act between the interests of the public and private sectors.

But UNICE says the Commission's suggestion of a separate clause spelling out one of the EU's tasks as “a contribution to the promotion of services of general interest” carries the same risks of blocking market-opening measures and strengthening incumbent monopolies.

All four options could be abandoned in the final phase of the IGC negotiations in favour of a declaration on public service outside the ambit of the new treaty, said one official.

He added that this would make an appropriate gesture without giving any hostages to the future.

Belgium has already signalled that it will go ahead with the imposition of a series of far-reaching universal service obligations on different sectors if no EU initiative is forthcoming.

Individual sectors will be able to propose their own codes of conduct or, failing that, face government-imposed demands, Belgian Minister for the Economy and Telecommunications Elio di Rupo has said.

Consumer Affairs Commissioner Emma Bonino has widened the debate on public service by suggesting that certain basic obligations should also be placed on the banking sector to provide a minimum level of service to all customers.

Di Rupo has anticipated Union decisions in this area by demanding that all citizens should be able to open bank accounts, even if they are unattractive as clients because they are on low incomes or are unemployed.

The Commission is expected to detail its expectations of the basic services to be offered by banks before the summer.