Rare opportunity for social change

Date: 12/11/1998

Despite recent setbacks for EU social policy, Austria's minister remains optimistic about the future. Myles Neligan reports

ELEONORA Hostasch, the minister responsible for employment, health and social affairs in Austrian Chancellor Victor Klima's Social Democrat government, has presided over a relatively turbulent period in EU social policy.

Since Vienna took over the day-to-day management of Union affairs in July, developments on the European scene have not been particularly encouraging. Last month, the European Commission's efforts to bolster the beleaguered social dialogue were dealt a serious blow when EU employers' federation UNICE refused to start negotiations on worker consultation with the European Trade Union Confederation (ETUC) and CEEP, which represents public sector employers.

At the same time, talks between national governments on moves to set up pan-European companies have continued to founder on the issue of worker participation.

More generally, the imminent introduction of the euro, together with the leftwards shift of many Union governments, look set to cause a fundamental rethink in many areas of EU social policy. This has created an atmosphere of uncertainty made up in equal measure of anticipation and trepidation.

Against this backdrop, Hostasch remains staunchly optimistic, asserting that major breakthroughs may well be achieved in the dying days of the Austrian presidency and holding out hopes of a realignment of EU social policy behind the overriding objective of alleviating the Union's unemployment crisis.

"It is too early to assess the achievements of the last few months," she says. "The main decisions on a lot of issues will not be taken until December, so it is far from over."

Austrian officials are currently putting together a second compromise proposal designed to win over the countries holding up agreement on the Commission's initiative to permit the setting up of pan-European companies. Hostasch admits that brokering a deal will be difficult, but says it is now essentially a matter of fine-tuning the compromise plan submitted last April by the UK presidency.

But she is sympathetic to countries such as Germany which are reluctant to accept a European Company Statute which would dilute their highly inclusive rules on worker participation.

"Workers who have the right to participate in company decision-making under national rules should not lose this right when their firm merges with another," she says. "I would regret it if we cannot bring about an agreement here."

Away from the vexed issue of the company statute, Hostasch has a clear agenda for what she would like to achieve during what remains of her government's period in the Union chair.

The issue of equal opportunities, and women's employment rights in particular, comes at the top of the list. "You could say that if I have one goal for now, it is to reinforce the equal opportunities aspect of the EU employment guidelines," she says.

Hostasch is at one with Social Affairs Commissioner Pádraig Flynn in believing that the employment plans drawn up by Union governments neglect the issue of equal opportunities.

She believes that national authorities should make a firm commitment to improving access to employment for women, ethnic minorities and disabled people, and will urge her EU counterparts to sign up to a declaration to this effect at their next meeting on 2 December.

If she is successful, Union heads of government can be expected to give the resulting document their seal of approval at the Vienna summit next month, giving the equal opportunities cause a significant boost.

Hostasch hopes that this will eventually lead to further concrete proposals for improving equal opportunities at EU level. "There are many areas where concrete initiatives could successfully be introduced," she says, citing subsidised child care as one measure which could bring about an immediate improvement in women's employment prospects.

She stresses that her aim is to improve the quality of women's employment as well as their representation in the workforce, arguing that much of the recent growth in female employment results from the proliferation of poorly-paid, part-time jobs. Professional training, particularly in innovative skills, also has a role to play.

Hostasch takes the view that the introduction of the euro and the election of centre-left governments in all but two of the EU's 15 member states will together bring about a political climate favourable to 'progressive' social measures.

She accepts that there are some inherent contradictions between the stern fiscal discipline written into the single currency's growth and stability pact, and the left-of-centre social and employment policies now espoused by many of the Union's governments, but is keen to downplay these.

Her overriding message is that the next few years will provide Europe with a rare opportunity to bring about major and lasting social change for the better in the old continent.

"I am very glad about the change in the European political scene. I think it gives us a big chance to make some important improvements. But it is a question of finding the right way," she says. "There will not be one common strategy, but many competing suggestions from different governments. The challenge is to learn from one another, and build our conclusions into EU policy."

Critics might say that this rosy prediction of a flourishing programme of social policy initiatives take far too little account of the many pitfalls facing the EU's new governments as they preside over the introduction of a single currency designed by their predecessors, who for the most part came from the opposite end of the political spectrum.

Commentators have already pointed out that some recently elected governments are showing signs of retreating from the programme of fiscal austerity and tight monetary policy implied by the euro, and the more pessimistic among them have even predicted that the whole project could unravel.

There are also signs that the single currency, far from ushering in a period of stability accompanied by constructive social dialogue, may set workers and employers against one another as never before.

The ETUC is campaigning for EU-wide collective bargaining on pay and conditions as an essential counterweight to the euro, fearing that the ease of comparing different national wage costs across the single currency zone will lead employers to move their production facilities to neighbouring countries with cheaper workforces.

But employers are strongly resisting this proposal, arguing that the increase in cross-border competition generated by the euro means that unions may have to accept wage cuts.

Hostasch does not pretend to have any solutions to this conflict, simply arguing that the greater economic growth which should accompany the euro will give both workers and bosses greater room for manoeuvre. But, implicitly criticising the obsessively deflationary policies of the centre-right governments which designed the single currency, she insists that its benefits must be shared as widely as possible.

"The euro will make the EU more competitive, and the resulting economic growth opens up opportunities for more employment. But we have to use those opportunities. The capital sector cannot be the only winner," she says.

Hostasch is firmly convinced that if they rise to the challenge of the euro, national governments and the EU institutions have it within their grasp to put in place social and employment policy measures which genuinely meet the needs and aspirations of the Union's 370 million citizens.

"The EU has the capability and the right to forge a unique social model. Europe has a particular social structure, and I do not believe that there are useful lessons to be gained from comparing EU social policies with those in place in Asia or Latin America. There is widespread agreement on this amongst EU governments," she says.

Major interview with Eleonora Hostasch, Austria's minister for employment, health and social affairs.