To be checked against delivery

I echo the appreciation of Candido for the start made by the Austrian Presidency and by you personally. It has been a very positive beginning.

We have submitted via Fritz a document about what we hope to see develop under your Presidency.

Necessarly, I will focus on a small number of points.

First I would like to reflect on your remarks yesterday on the Services Directive. We cannot accept that trade in services should be based on a competition where 25 member states compete on each other’s territories at the expense of the environment, industrial relations systems, workers rights and other public interests.

This careless proposal from the previous (Prodi-led) Commission was careless, poor politics. The social partners were not involved in its formulation. It has bred protectionism and defensiveness. It played a negative part in the French referendum. Far from extending the Single Market, it has posed a huge threat to it.

What we want now is to join those discussions you proposed yesterday and, after the Parliamentary stage is complete next month, we want to contribute to devising a better Services Directive than what we have now.

Central to that is excluding labour law and services of general interest from the Directive, the deletion of Articles 24 and 25 which deal with posted workers, and the restriction of the contentious ‘country of origin’ principle. Our ancesters coined the phrase - when in Rome, do as the Romans do - and we should respect that wisdom - and not base the opening up of services on a different one. We can support non-discrimination against other EU nationals, and on equal access to markets. We know that services employment can be expanded - although we are sceptical about some of the high figures that are quoted in support of the Services Directive’s impact on employment levels.

You clearly appreciate the risks and opportunities in a better Services Directive and we are interested in how you see the talks being developed in conjunction with the social partners.

My next - and related point - concerns mobility. As we discussed at the informal social summit in London, if there is free movement of labour across 25 countries (qualified to an extent by transitional measures), then there must be some common standards. Of course, Greece is not the same as Poland, Sweden as Portugal - but on fundamental rights, on information and consultation, on health and safety for example there should be readily understood rules which apply everywhere. I am not arguing for common pay - that reflects productivity levels - but rather on the way people are treated and on the encouragement of social dialogue, social partnership and collective bargaining.

Austria has been conspicuously successful using these principles. I hope that you will help us spread them. If otherwise a liberal laissez-faire approach is followed, there is a real danger that people will react against the free movement of labour principle.

Two current legal cases - the Vaxholm and Viking cases in Sweden and Finland respectively illustrate the problem when national labour laws are challenged by the application of the free movement of labour principle.

Of course, Chancellor, there are many other issues confronting Europe - new life for the Lisbon strategy, more economic governance to boost growth, more emphasis on R+D and innovation, relations with China, Russia and other emerging economic powerhouses.

We believe that the ETUC and Europe’s unions can contribute significantly on all these questions and I hope that we can work well with you and your Presidency in the months ahead.