There are many aspects of the EU draft services directive which should worry consumers, writes Proinsias De Rossa
A number of articles in the Irish media over recent days have dismissed Labour's objections to key principles and provisions of EU commissioner Charlie McCreevy's draft services directive. These articles go along with Government claims that the posting of workers directive, which is intended to prevent a race to the bottom in pay and conditions of workers posted temporarily to an EU member state, addresses our concerns.
Our doubts about this proposal relate not just to the issue of labour standards but also cover its scope, the impact on public services and the inadequate protection for consumers and the environment (among others). Moreover, there is the distinct possibility that the Government may yet find itself before the European Court of Justice for inadequately enacting the posting of workers directive into Irish law.
Even if it has been properly transposed, this particular piece of legislation offers only partial protection, as highlighted by Pat Rabbitte's letter of January 30th. The commission for instance stresses that it "in no way permits member states to extend all their legislative provisions and/or collective agreements governing terms and conditions of employment to workers posted on their territory". Indeed, because of loopholes that have been highlighted, the European Parliament has now asked the commission to issue proposals strengthening this legislation.
Nor is this legislation sufficient in itself. The commission itself points out that its draft directive on temporary agency workers would, "once adopted, significantly improve protection for posted temporary workers. . ." Irish ministers, however, are among the most vehement opponents of this proposal in Brussels.
Mr McCreevy's proposal would actually undermine the posting of workers directive. For instance, the European Court of Justice has ruled that the effective protection of posted building workers can require the holding of certain documents on site. The services proposal, however, would outlaw this requirement, and the requirements for service providers to make a formal declaration to, obtain prior authorisation from, and designate a representative in the host country. In effect, it would render null and void any possibility of effectively policing implementation of the posting of workers directive.
In reality, only public administration is entirely excluded from the proposal and the derogations from the country of origin principle for some public services are far from clear or sufficient. For example, health services and social services (eg, elder-care) are not excluded. This completely ignores the specific characteristics of such services (ie allocation and payment by third parties) and presupposes that so-called "consumers" of such services can assert their right to quality services.
Consumer protection is wholly inadequate. Under the country of origin principle it is suggested that a family in country A who engage a builder from country B "temporarily" (which isn't defined) operating in country A would see their home built in accordance with country B's regulations covering the "behaviour of the provider, quality or content of the service, contracts and provider's liability" (Art.16(1)). If problems later arose, country A's consumer protection laws would not apply and the (now-departed?) builder could only be pursued though country B's legal system. Is this realistic? Would their insurance company in country A pay out?
The supervision of temporary service providers would rest with their country of origin.
Would such regulators, however, have any real capacity or indeed interest in supervising the activities of providers operating in possibly 24 other countries? Environmental organisations warn that the proposal would undermine national environmental laws and policies.
Closer administrative co-operation between national authorities is proposed, but, on the basis of member states' previous experience of such co-operation, it must be feared that there will be no effective supervision.
The European consumer organisation, BEUC, warns that "the gap between theory and practice could be large". Very sensitive sectors such as gambling and casinos and sectors such as private security and temporary agencies which go unregulated in many countries are included.
The proposal also limits member states' ability to derogate from the "country of origin" principle, on public policy grounds. The suggested grounds - safety of services, public health, child protection - on a case-by-case basis and in exceptional circumstances, are much more restrictive than those hitherto accepted by the European Court of Justice (eg protection of workers and consumers, maintaining a balanced health system open to all, etc).
The services sector accounted for 11 million new jobs in Europe between 1997 and 2002.
There is a need for European legislation governing this sector and, rather than leaving it to the courts, I want to see legislators agreeing this law.
The European Parliament votes on February 16th. Socialist Group amendments accepted by the European Parliament's internal market committee go some way towards addressing the problems outlined above (and others). But much more needs to be done.
As Labour's representative I will be supporting and tabling amendments, through the Socialist Group, that address these concerns.
The commission and ministers must respond positively to the issues we are raising on behalf of Europe's citizens if a services directive is to be adopted.
Otherwise, the European Parliament will exercise our right to veto the entire proposal, as we did last month with the controversial ports directive.
• Proinsias De Rossa is Labour Party MEP for Dublin