The EU must reform Mar 02

Why does a car cost less in Denmark or Brussels than in the UK? Why are beer, wine and cigarettes cheaper in Spain than in the UK or Sweden? Why can we not buy any item for personal use from any part of the EU without restriction? Rules, rules and more rules!


The summit of EU Heads of Member States in Barcelona is an opportunity to review the economic liberalisation planned almost ten years ago. Only two years ago in Lisbon, such a summit highlighted the importance of making the EU "the most competitive knowledge-driven economy in the world by 2010". What is the reality?


The EU continues to approve endless legislation affecting employment and the environment - legislation that adds to the cost of labour and the cost of production for industries. These costs impact seriously on small and medium sized enterprises that sustain existing jobs and create new ones. No wonder the USA creates more jobs in one year than the EU does in ten!


I suggest a simple plan for the EU Member States:-


1. The EU must not impose any new taxes. Taxation in Europe is too high and every attempt should be made to lower both direct and indirect tax. Member States should compete with each other in offering the best economic environment to attract inward investment - not harmonise and force higher levels of taxation on the EU citizen!


2. The Social Chapter has introduced extensive social legislation which results in very high non-wage costs of employing labour. Often the laws are not enforcable e.g. there is cuurently a directive to restrict a tractor operator to using his machinary for just 7 hours a day. This is silly because a tractor is used much more during harvest time and not at all during off season. In any case, how can you enforce such a law on a private farm?


3. Small and medium-sized businesses including self-employed people are overwhelmed by a mountain of paperwork - forms to be filled to comply with all sorts of regulations! Such activity does not create wealth and value added.Such red tape costs our businesses about 30bn every year.


4. The EU has failed to encourage the use of new technologies in production, financial services, government affairs and in public services. E-commerce, electronic data cards and widespread use of IT allows the USA to increase its GDP by 0.5% - a benefit that the EU can also secure for its citizens.


5. The EU must ensure that Member States comply with existing legislation as we need our businesses to have a level playing field. There is no single market for goods, services (including financial) and labour as Member States continue to subsidise enterprises thereby limiting the choice to consumers who end up paying high prices. Many businesses and governments break the rules deliberately as the financial penalties are not severe and court action takes years! There are, at present, almost 1500 infringement proceedings pending in the European Courts. The EU must take action to stop such abuse.


The EU will inspire its citizens and gain their confidence only if it demonstrates that there is competence to deliver economic growth and prosperity. Summits of the Heads of State should not be a photo opportunity to impress domestic audiences for electoral advantage - they should be business meetings without fanfare where decisions are taken that can be implemented over a specified time frame.


I appeal to the EU Heads of State - if you want to inspire your citizens, especially the young, then please cut out the bureaucracy and kick-start action. The citizens of Europe need such action well before they decide to vote in the next European Elections in June 2004!