1. Introduction

The Austrian Presidency takes place at a moment that should represent a new start for the European Union. Following the adoption of the financial perspectives the time has come to focus on the follow-up to the Hampton Court European Council in order to give a true social dimension to the European Union.

The concept of Social Europe must be central to the development of the European Union where economic and social progress must go hand in hand. The balance between the two should be struck without hesitations and, within an enlarged European Union and a globalised world, the European approach must be the promotion of a social market economy, with social rights.

The ETUC expects the Austrian Presidency to work towards the creation of conditions that will allow for the full implementation of the Lisbon strategy, namely the promotion of economic growth, innovation, R&D, lifelong learning and the creation of high quality jobs.

Trade unions and workers across Europe will only be prepared to discuss and negotiate on flexi-security if their fundamental rights are guaranteed and if there is a balance between the interests of companies and those of workers, not just in terms of working conditions but also as regards the anticipation and management of change and the negative results for workers and territories resulting from the relocation of companies and activities. ETUC defends a new balance between the interests of shareholders and those of stakeholders. Balanced decisions on matters such as the Working Time Directive, the Temporary Agency Workers’ Directive or the Services Directive would certainly help to restore a climate of trust in the EU amongst European workers and citizens. We consider the Austrian Presidency to be well placed to work towards this objective given the strong partnership model that characterises the Austrian society and labour market.

The ETUC also expects progress to be made on difficult issues for Europe such as the demographic challenges and how they should be addressed and the need to establish a common legal framework for migration and mobility.

Finally, the Austrian Presidency will also need to address the difficult debate on the Constitutional Treaty and to relaunch the process at the June 2006 summit. The Austrian Presidency has to check what the alternatives are for the Constitution, if there are any, or create conditions that will enable the Constitution to be approved with a declaration on the social dimension as proposed by the German Government. The ETUC wishes to play an active role in the debate and to help to find the most adequate ways of achieving a result that strengthens the social dimension of the treaties.

2. Social Europe

Getting the revised Lisbon Strategy back on the right track

The relaunch of the Lisbon Strategy, decided at the 2005 Spring Council, is in danger of suffering from the same mistakes that have led to the failure of the Strategy in the recent past: a policy agenda that is seeking economic reforms just for the sake of reform. Such an imbalanced approach will not deliver more or better jobs.

Reforms are necessary but they need to be the right kind of reforms. Reforms need to invest in better labour market institutions, not undermine workers’ confidence and make them even more insecure by dismantling and deregulating labour rights and social protection.

Reforms also need to trigger pro-active aggregate demand policies that make full use of the potential for the economy to grow. When reforms improve the aggregate supply of an economy, it needs to be balanced with increased aggregate demand. Therefore, Europe needs to break with the ideology that monetary and fiscal policies are only there to fight inflation and not to support growth.

The ETUC remains committed to the goals and objectives of high growth, high employment rates and social cohesion. But if the Lisbon strategy is to work, a change in course is urgently needed. The fragile recovery must be turned into a robust upturn with high and strong growth. Europe is able to grow at rates of 2.5 to 3% a year without triggering inflation but the recovery that seems to be in the pipeline is too weak to deliver such rates.

The ETUC urges the Austrian Presidency to address this (1) by setting up a European Initiative for recovery by drawing up national plans for recovery that invest 1% of GDP in the Lisbon priorities. Instead of using the renewed Stability and Growth Pact to get a little more time to reach the 3% deficit, the new Pact should be used in an offensive way. Flexible solutions to fund new and additional investments in the Lisbon priorities should be sought. Financial leeway should also come from increased tax cooperation in Europe aiming to limit excessive tax competition on those income categories that are the most mobile, in particular company taxes; (2) by improving economic governance, in particular at the level of the euro area. Irrational and unfounded fears for inflation should not lead to a monetary policy regime that stifles the recovery each and every time growth is accelerating slightly. Therefore, the ongoing dialogue between euro area finance ministers and the ECB should be pursued and enlarged by involving European Social partners more closely. In this context, the planned review of the existing process of macro-economic dialogue (the Cologne process) should be conducted with a view to strengthening this dialogue and its structures and making it deliver an improved macro-economic policy mix that is conducive to high growth with low inflation; (3) Promoting social partners’ ownership by balancing the competitiveness agenda with a social agenda: a preliminary overview of national reform plans reveals that consultation of social partners was not optimal. It is not simply the tight and unrealistic timing that is to blame but also the fact that the new Lisbon approach of the Barroso Commission is seen as favouring an unbalanced business-friendly policy agenda. This is creating tensions and dwarfing the social dialogue in some countries. Many ETUC-affiliates also regret that the issue of excessive flexibility on the labour market was not addressed at all or, in some cases, may even be made worse as a result of introducing reform plans that are mainly based on the reduction of workers’ rights and social protection.

Therefore, the ETUC expects that the Austrian Presidency works towards closer involvement of the social partners, both at European and at national level, in the upcoming process of adapting the integrated guidelines. This process of guideline adaptation should be managed with the aim of balancing flexibility with security and fighting excessive flexibility on labour markets.

The Spring Tripartite Social Summit should be a focal point to stress the extent to which social partners were involved and the extent to which changes in guidelines are necessary so that governments do not opt for the dead-end street of deregulation of labour markets.

Cohesion policy

An inter-institutional agreement between the Council and the European Parliament on a budget for the 2007-2013 period is urgently required early on in 2006. The ETUC expects the Presidency to work towards an acceptable compromise that will enable it to respect the EU political commitments and that allows the time necessary to adopt multi-annual programmes which provide legal bases for much expenditure, including Structural Funds, trans-European networks, research, education and training.

The ETUC stresses the importance of strengthening Community structural policies in an enlarged Europe, because the principles of cohesion and solidarity are enshrined in the Treaty and constitute two of the most important vehicles of integration for both peoples and regions. The ETUC reiterates that the cohesion policy must provide responses to Europe’s challenges, helping to reduce disparities between regions and promote a society of full employment, equal opportunities, social inclusion and cohesion and, more broadly, the European social model. A balance must be found between investments in infrastructure and investments in human capital, whilst averting the risk of fragmenting support measures. At the same time, infrastructure projects must integrate the ’employment’ objective and be linked with a human resources policy capable of anticipation.

In our opinion, partnership is a fundamental principle in guaranteeing the success of Structural Fund measures. The aim of quality partnerships should be pursued, involving the social partners at every phase of the Funds’ interventions. It is therefore essential that the same type of participation is planned in the other Structural Funds, as in the case of the European Social Fund. The social partners should be properly consulted at national level on the National Strategic Reference Framework to be established by the Member States.

ETUC therefore reiterates its desire for the future Structural Funds Regulations to clearly define the partnership principle, rather than relying on national rules and practices. ETUC supports the Commission’s proposal that, under the Convergence Objective, at least 2% of the European Social Fund resources are allocated to developing capacity as well as to joint activities by the social partners. ETUC is also pressing for a clear reference to be made to social dialogue, in accordance with the Commission Communication “Partnership for Change in an Enlarged Europe - Enhancing the Contribution of European Social Dialogue”.

Demographic change

During the Austrian Presidency, the debate will continue on what measures should be developed at national and EU level to respond to the challenges of demographic change. The ETUC wants to warn against a debate that is too focussed on the issues of social expenditure and burdens for future generations, but instead wants to respond proactively with an integrated approach, focussing on a broad range of policies pertaining to employment, life long learning, working conditions and social protection in general and on more targeted policies on migration, gender equality, young people and older generations. The ETUC, in its response to the Commission’s Green Paper, has called for an intergenerational contract to address active ageing strategies coupled with actions to get young people onto the labour market.

In addition, it is important to acknowledge the fact that women play a key role in addressing demographic change. Providing women, especially young women, with a perspective on the ability to reconcile family and work and share this responsibility with their male partners and society, gearing welfare systems towards the changing realities of families and a feminising labour market as well as the emphasis on high quality employment opportunities for women in terms of contractual relationships, careers and wages are key factors in facing up to the demographic challenges. In this respect, it is important that the Austrian Presidency adopts the proposal made by the Swedish government in the recent meeting of the Council, when the issue of demographic change is being discussed, in order to develop a Gender Pact.

European Youth Pact

In March 2005 the EU Heads of State and Government adopted a European Youth Pact as one of the instruments contributing to the achievement of the Lisbon Objectives.

The ETUC welcomes this initiative, which adds a youth dimension to the overall Lisbon strategy. Now, it is time to translate it into ambitious programmes. Such programmes should include concrete targets in order to achieve measurable results for young people, which are based on the prevention of long-term unemployment through education and the commitment to improve the quality of jobs, the guarantee of access to high-quality education and professional training, support initiatives implemented by Member States for ’Youth Pact’ programmes and also measures that encourage solidarity between generations and in which the social partners are involved at all levels.

Working Time Directive

During the UK Presidency, the Council of the European Union could not agree on the next steps to be taken with regard to the Commission’s proposals for the revision of the Working Time Directive.

The ETUC asks the Austrian Presidency to do everything within its competence:
  to ensure that any proposals for the revision of the Working Time Directive, developed in the Council of Ministers, are compatible with the European Treaties and the Charter of Fundamental Rights, which guarantee every worker in the EU the right to limit his/her working hours;
  to take a firm stand and only pursue a political agreement in the Council which will enable the individual opt-out of maximum working hours to be phased out;
  to convince other Member States that clear support for the compromise amendments, adopted by the European Parliament, is the only possible way forward which Europe’s citizens and workers will understand.

A political agreement will have to contain the following elements: a) phasing out the individual opt out; b) providing for balanced and proportional solutions for ‘on-call work’ that are consistent with Community law; c) providing for genuine measures to reconcile work and family life and to protect the health and safety of working parents and carers; d) allowing for longer reference periods for the calculation of the average 48-hour working week only if agreed by means of collective bargaining or with additional legal safeguards that guarantee proper consultation of workers and/or their representatives and adequate protection of their health and safety.

New proposals on health & safety

2006 will mark the start of the debate on the new health and safety strategy for 2007-2012. We are expecting the Austrian Presidency to play an active role and to lead discussions, in particular on the implementation of the framework directive, on the assessment of the 2002-2006 strategy and on the proper implementation of common rules in the 25 Member States.

The ETUC is stressing the importance of pursuing the approach determined in 1986 at the time of the Single European Act: the harmonisation of market rules must go hand in hand with the harmonisation of social rules governing health and safety, without which we would run the risk of creating downward competition. The current campaigns for ’better regulation’ generally tend to deviate from the aim of harmonisation and present health and safety in a superficial and unjustified manner as a cost and a burden. They neglect the vast potential for improvement which has been partially attained, although more substantial efforts are still required.

It is highly likely that REACH will be adopted in 2006. A strategy for efficiently linking market and social rules must be set up. Protecting workers against chemical risks primarily requires the extension of the Carcinogenic Agents Directive so that mutagens and substances toxic to reproduction, measures pertaining to silica (one of the main carcinogens to which workers are exposed) and, in particular, the definition of a binding limit value are included in the directive. A major effort is also required if progress is to be made in defining indicative limit values.

Given the lack of real progress in the Community initiatives on musculo-skeletal disorders, we are expecting action to be taken in this area in 2006. We are also hoping that support will be provided to SLIC’s activities, especially the campaign on asbestos planned for 2006.

The Austrian Presidency should also relaunch the discussions on better integrating the gender dimension into occupational health and should follow up the demand that the ETUC has been making together with the European Parliament since 2000 on the revision of the Pregnant Workers Directive.

A rapid decision by the Council on the Directive on Temporary Work would also have a positive impact on the extremely concerning situation regarding the health and safety conditions of temporary workers.

Finally, the Commission will have to follow up the second phase of consultation on the simplification of measures governing the implementation of occupational health and safety directives.

Common objectives for social protection

The ETUC hopes that during the Austrian Presidency the OMC on health will be implemented and will contain ambitious objectives. It must incorporate high-quality care which is financially and geographically accessible to all and which is financed by long-lasting and solidarity-based contributions. As regards long-term care, the accessibility to care infrastructure and services must be extended and developed whilst respecting and taking account of the human side of the patient(s) and prioritising and encouraging the involvement of all stakeholders.

As regards streamlining - the implementation of which is supported by the ETUC - the Presidency must ensure that the process helps to bring about better linked and mutually reinforcing policies.

It must also make sure that the NAPs do not simply constitute activity reports but become genuine action plans, geared towards achieving pre-determined objectives. The evaluation of the NAPs by the Social Protection Committee and the Commission on the basis of quantitative and qualitative indicators must enable guidelines/recommendations to be established for the future. The ETUC thinks that the process must enable high-quality social protection to be developed that is accessible to all and must also result in upward convergence.

Finally, and even if social protection is not included explicitly in the Lisbon Strategy as the ’third pillar’, it must not be pushed aside or given merely secondary importance. As far as the ETUC is concerned, social protection is an integral part of the ’European social model’ and is essential for social cohesion.

European Union Agency for Fundamental Rights

The ETUC welcomed the Commission’s proposals for the establishment of a European Union Agency for Fundamental Rights. ETUC has always been and is still striving for and contributing to an efficient and effective protection of fundamental rights - in particular trade union and workers rights - also beyond the EU context. As regards the establishment of this new Agency, the ETUC is counting on the Austrian Presidency to ensure: 1) the involvement of the European social partners in the Agency’s work and structures; 2) adequate resources for the Agency to enable it to function properly; 3) that means are developed which allow direct and indirect use of the Agency’s recommendations before European (extra) judicial bodies; 4) close cooperation with other relevant ’social rights’ stakeholders such as the Council of Europe; and 5) that the Agency does not limit its scope of action to the current Member States but extends it to candidate countries and all countries with which the EU has a specific (contractual) relationship (’neighbouring countries’, ACP, etc.).

Institute for gender equality

The ETUC welcomes the proposal to create a European Institute for Gender Equality which will gather, analyse and disseminate reliable and comparable research data and information. The Institute will raise awareness of gender equality policies and will develop tools to support gender mainstreaming.

However, for the ETUC a certain number of conditions must be in place in order to ensure the full efficiency of this institute which include: (1) a clear and explicit role for the European social partners in the institute as members of the board with full voting rights; (2) the work of the institute must be technical rather than political in nature - i.e. its role must be to provide assistance and expertise to policy makers, but not be a policy making body; (3) the work must not duplicate the work being done by other institutions such as the European Foundation for the Improvement of Living and Working Conditions; (4) it must be adequately financed. We hope that we can count on the support of the Austrian Presidency in this respect.

Lifelong learning

European cooperation in the field of lifelong learning will have to be boosted during the European Year of Workers’ Mobility. The main initiative deals with the European Qualification Framework, which will increase transparency and comparability of qualifications. The ETUC has supported the EQF proposal. This development is vital in order to enable the mobility of individual workers and citizens. Moreover, the implementation of the Education and Training 2010 work programme must be strengthened at national level. ETUC believes it to be crucial for all member states to establish national follow-up bodies to support and monitor the implementation of European priorities at national and regional level. ETUC stresses that social partners and other stakeholders need to take part in this process. This will increase the visibility, legitimacy and effectiveness of European policies among grass root actors.

The year 2006 is also important for European cooperation since the joint follow-up report of Education and Training 2010 will be adopted by the Commission and the Education Council in February. At the end of the year in Helsinki, European education ministers, the Commission and European social partners will agree on new communiqué to push forward the Copenhagen process of vocational training. ETUC stresses that instead of establishing several new initiatives and priorities, Europe must work together to implement decisions and recommendations that have already been taken within the Copenhagen process and the Education and Training 2010 work programme.

3. The social dimension of the internal market

The need for better quality regulation

The ETUC asks the Austrian Presidency to integrate more of a quality approach in the ongoing debate on the improvement of the regulatory framework. Less regulation through shifting responsibilities or costs to other actors, according priority to weaker/lighter forms of regulation or international standards does not necessarily lead to a better regulatory framework. The withdrawal of regulation cannot be deemed to be better regulation, but instead is a reduction of the regulatory density. Therefore, precise language is needed to distinguish measures that address (a) the quality and (b) the quantity of regulation.

It currently seems quite common to suggest that the main problem is the quantity of regulation. A fairly technocratic ’count-and-post-approach’ seems popular as does rather populist talk about far too much red tape, administrative burdens, flooding of standards and so forth. The ETUC thinks it is misleading to suggest that the main problem is too much regulation in general. In fact, the problem is often the poor quality of regulation as regards clarity, consistency and accessibility as well as a lack of compliance with legal acts in the Member States. This is exacerbated by the absence of a systematic method of enforcement by the Commission.

Everyone will agree that "advancing better regulation in Europe" - the title of the joint working paper of the UK, Austrian and Finnish Presidencies, presented in December 2005 - is essential, especially in a Europe of 25. However, there are different ways of achieving this. It is, therefore, important to assess the instruments and strategies for developing a regulatory framework which is clear, concise and enforceable.

In this context, the ETUC supports the systematic use of impact assessments as a tool for decision- makers. The impact assessments evaluate the economic, social and ecological impacts of possible regulation on an equal footing. However, the ETUC thinks it would be irresponsible to include the measurement of the administrative costs of legislation in the impact assessments or the simplification process. The methodology of this instrument is still rather weak and there are currently only a handful of Member States that use this tool at national level or that plan to do so in the future. The ETUC urges the Austrian Presidency to launch a debate on new instruments to assess the costs of not regulating e.g. the costs of non social regulations. The ETUC will closely monitor this process to make sure that the design of the instruments does not result in a shift in the balance of the three pillars of the Lisbon strategy in favour of a mere business-oriented approach.

The ETUC stresses that international regulatory cooperation should be enhanced to improve international standards (e.g. the promotion of decent work for all). The differences between regulatory standards should not be used as an argument to water down European standards pertaining to the economic, social and environmental dimension. However, the attempt to test all proposals for their impact on companies’ competitiveness in comparison to their non-EU rivals indicates a different approach, as do the proposals to include such a divergence-test in the simplification process.

Starting with the Austrian Presidency, the composition and results of sectoral pilot-projects on better regulation (like CARS 21) should be publicly assessed and debated. Better consultation of all relevant stakeholders on the process of regulatory design and reform is required. This should be considered when new task forces are designed. As regards the social acquis, the special role of the social partners, as laid down in the treaty, must be respected at all stages.

Instruments such as impact assessments can help to attain a better regulatory framework but should not be used as "an excuse to impose a business-focused, deregulatory agenda on policy makers". The Austrian Presidency should encourage all political actors to achieve greater transparency in the design of instruments and processes. This would be an important step for increasing trust of and support for the better regulation approach.

For a better Services directive

The ETUC believes that the social dimension of the internal market is a fundamental component of the internal market project. The ETUC wants to stress that the internal market and the draft Service Directive should include a strong social dimension, notably respect for fundamental social rights. Economic and social development must go hand in hand with the basic objective of harmonising living and working conditions upwards and with full respect for national industrial relations systems. The ETUC believes that the key to a sustainable internal market and to achieving the basic objectives is fair competition. Fair competition means a level playing field for companies and fair working conditions and equal treatment for workers.

The ETUC would welcome job creation in service sectors across Europe but has serious doubts about the claimed positive employment effects of the current proposal for a Service Directive and is gravely concerned about some of the main provisions in the draft directive. The ETUC’s view is that the economic case for the country of origin principle in the Service Directive has not yet been made. More trade in services within Europe should not be achieved through regime competition, where 25 Member States compete on each others’ territories at the expense of the environment, industrial relations systems, workers’ rights and other public interests.

The ETUC believes that the long-term instrument for the creation of the internal services market must be basic harmonisation of quality, content and safety standards. The ETUC believes that, in the shorter term, the creation of the internal services market must take account of the possibility for Member States to maintain high standards on social and environmental requirements and the protection of workers’ rights.

The ETUC asks that labour law and services of general interest are excluded from the Directive. The ETUC expects the Austrian Presidency to have a new ’Commission’s amended proposal’, as promised in the Presidency Conclusions of 15/16 December, which takes account of the ETUC’s main demands.

ETUC believes any clarification in the field of posting of workers should be dealt with under the existing Posting Directive. The starting point must be that issues relating to the Posting Directive should be dealt with in its proper context. Arguments to support this are legal certainty and consistency. Articles 24 and 25 should therefore be deleted from the Service Directive.

European Constitution - what next?

Following the rejection of the European Constitution in France and the Netherlands, the ETUC has confirmed its commitment to the Constitution. The ETUC is intently following the debate on the reflection period being held in the European Parliament and expects to be part of any new initiative to relaunch the constitutional process.

The European Council will return to the issues in the first half of 2006 and the ETUC expects proposals on how to get the process back on track and what steps now need to be taken. It is generally expected that either a Declaration on the social dimension of Europe will be proposed (the new German Chancellor Angela Merkel made this public on 19 December 2005) and/or a new Convention will be convened to advise on whether or not the text of the Constitution should be partly restructured, should be improved and accompanied by parallel declarations or should explain the EU’s objectives more clearly. Overcoming the widespread malaise which widened the gap of understanding of and sympathy with the European project between the Institutions and the citizens in recent years will require much more than better communication policies. In fact, what is needed is for the EU to reaffirm, and not minimise, European values on social cohesion, solidarity and environmental sustainability. The ETUC expects the Austrian Presidency to conduct a clear stocktaking exercise and to issue a decision on how to proceed in the future.

European Year of Workers’ Mobility

The ETUC welcomes the Commission’s proposal to declare 2006 the "European Year of Workers’ Mobility - Towards a European labour market". Obviously, freedom of movement of people and workers, as enshrined in the Treaty, is a priority for ETUC, especially since unlike the three other freedoms of movement it has still not been fully established.

The conclusions reached by the Task Force on Mobility and Skills and the 2002 Action Plan on Skills and Mobility pinpointed the obstacles to mobility and presented 25 specific steps to be taken to remove them. The Commission’s report on the implementation of this Action Plan (February 2004) shows that although some of the obstacles to mobility have been eliminated or are on the verge of being removed most of them remain in place. In this respect, ETUC considers that the way forward is not defining a new Action Plan but rather implementing the decisions taken with a view to fulfilling the three ’challenges’ formulated by the Commission: expanding occupational mobility and skills development; facilitating geographical mobility; improving information and transparency of job opportunities.

Furthermore, after the enlargement of the EU and the application of transitional measures regarding the free movement of workers from new Member States, this is a key issue in the context of the European Year of Workers’ Mobility especially as regards the implementation of monitoring mechanisms with the full participation of the social partners.

We would also like to stress that the EURES network, whose prime aim is to ensure the free movement of workers, and in which the trade union organisations also play an active role, must be one of the lines of action of the European Year of Workers’ Mobility so that obstacles to the free movement of workers are removed by all partners involved, i.e. the Public Employment Services, trade unions and employers’ organisations.

Cross-border portability of occupational pension rights

The ETUC supports the proposal for a directive presented by the European Commission. However, we think that more progress can still be made under the Austrian Presidency. We have expectations in the three following areas: (1) as regards the waiting periods for the acquisition of rights, provision is currently made for the rights to be awarded after two years of employment but this means excluding all those people who are victims of the increasing precariousness of employment (fixed-term contracts) and above all young people (regardless of their age) and women who are often the worst affected by this trend; (2) the formulation of the revaluing of ’dormant rights’ is too vague and does not actually guarantee anything; (3) periods for implementation are too long, including for companies which have posted reserves for their commitments on their balance sheet since this represents an obstacle to mobility and is a blatant paradox to the European Year of Workers’ Mobility.

Towards free movement of workers: from restrictions to conditions

ETUC recognises that transitional measures which restrict the free movement of workers from the new Member States to the ’old’ Member States, have been introduced by the latter to protect their labour markets. Although, especially in the border regions, these measures have been welcomed as allowing labour markets to gradually adapt without major shocks and imbalances, there have also been adverse effects in several Member States. In many instances, workers from the new Member States have become second or third class citizens, and this has given rise to unfair competition on wages and working conditions, an increase in undeclared work, false self-employment and exploitation and discrimination of workers from the new Member States.

Therefore, ETUC believes it urgent to develop an appropriate framework of firm and fair rules both at national and at EU level to support the emergence of a genuine internal market for goods, services and workers. The framework should consist of
  a set of minimum standards;
  clear principles of equal treatment for wages and working conditions applying to the place where the work is done;
  respect for the host country’s industrial relations systems, i.e. the rules governing collective bargaining and industrial action;
  mechanisms and instruments for cross border monitoring and enforcement of working conditions and labour standards.

Such a framework could result in Member States and their citizens no longer having to rely on transitional measures.

According to the ETUC, the area of free movement of workers shows that employment and mobility policies should be dealt with both at national and at European level and that, although the internal market is an EU competence, creating order in it for all situations of cross-border employment, including within the framework of the provision of services, demands a proper European social policy response.

Therefore, during the 2006 Year of Mobility, the Austrian Presidency, which represents a country ’at the heart of the matter’ due to its geographical location, should put pressure on all stakeholders, and especially the European Commission, to acknowledge that there are serious problems with the cross-border mobility of services and workers which require urgent action to be taken at EU level. The Austrian Presidency should also encourage them to work together to create a positive framework to support the creation of a European labour market, based on the principle of equal treatment and the upward harmonisation of working conditions and social systems.

As a matter of high priority, the Austrian Presidency should put pressure on the Commission and the Council: a) to ensure that the Services Directive will not in any way infringe on labour law, collective agreements and industrial relations systems, including the right to take industrial action, and that it will exclude sensitive services for the exploitation of migrant labour, such as temporary agency work, from its scope; b) to place the adoption of a strong Temporary Agency Directive high up on the agenda.

Economic migration

In early 2006 the European Commission will publish a communication as a follow up to the consultation on their Green Paper on economic migration. The Austrian Presidency has announced that it is interested in new EU measures to tackle the problem of illegal immigration. However, the ETUC strongly recommends taking a wider ranging and forward-looking approach on this issue.

ETUC is convinced that - in the interest of Europe’s current and future population - it is time to adopt a more pro-active EU policy on migration and integration which is based on the recognition of fundamental social rights of current citizens and newcomers and which is embedded in strong employment and development policies. Such a policy is necessary to help to overcome the demographic challenges facing the EU on the one hand and to tackle the challenges of integration and cohesion in increasingly diverse and mobile societies on the other.

Such a policy on economic migration should be established in close consultation with the social partners. It should prioritise investing in the capacities and qualifications of unemployed or underemployed EU citizens, including those from migrant or ethnic minority backgrounds, increasing efforts to combat racism and xenophobia, promoting the full integration of immigrants and ethnic minorities into European labour markets and societies and attributing social and political citizenship rights to migrant workers and their families. It should, however, also give rise to possibilities for the admission of economic migrants by providing a common EU framework for the conditions of entry and residence, which should be based on a clear consensus between public authorities and social partners on real labour market needs. Policies should also be developed which give a tough response to employers using exploitative employment conditions and which focus on prevention and sanctioning those who profit from these abusive situations, including traffickers in human beings, rather than penalising the workers who are the victims.

As a matter of urgency, such policies should also create ways out of ’unauthorised situations’ for undocumented migrant workers and their families, and thereby reduce exploitative situations and undeclared labour.

Reach

As regards the Chemicals Policy (REACH), after the recent political agreement in the Council, ETUC expects the Austrian Presidency to achieve a common position as soon as possible and to continue the action undertaken by previous Presidencies in order to arrive at a political agreement with the European Parliament in 2006. This reform is urgently needed in order to boost the industry’s ability to devise modern solutions for its future by developing criteria that are environmentally friendly and socially responsible.

Climate change

In accordance with the conclusions of the COP11, the ETUC is inviting the Austrian Presidency to involve the Union, without delay, in the preparation of a global agreement on the ambitious objectives to reduce emissions for the post-Kyoto period on the basis of the principle of common but differentiated responsibilities.

The Austrian Presidency must ensure that the Union’s commitments to reduce emissions in the medium and long-term are clarified immediately. It must ask the Commission to examine the conditions necessary for these objectives to be achieved with maximum effect on job creation and on preventing social difficulties which could arise as a result.

The ETUC also requests that the Austrian Presidency makes sure that the ETUC will be invited to provide expertise in the meetings of the subsidiary bodies of the UN Framework Convention on Climate Change which will take place in Bonn in May 2006.

Sustainable development

The European Council of June 2006 should adopt a revised European Sustainable Development Strategy. The ETUC thinks that the Commission’s proposal for such a strategy - dated 13 December 2005 - is not satisfactory since it does not provide clarification of the links with the Lisbon Strategy and does not make sufficient use of the positive interactions between employment and the environment by using new political initiatives.

The ETUC is therefore calling on the Austrian Presidency to ensure that the June Council adopts a revised strategy which includes objectives, new policies, measures and indicators on training, job creation and the quality of employment in the areas of climatic change, public health and transport. The revised strategy must make explicit provision for boosting trade union involvement in drawing up and implementing sustainable development policies.

4. Trade and external relations

We welcome the Presidency’s intention to promote multilateral structures and mechanisms and to enhance the coherence of external relations both in the EU’s internal decision-making and in the EU’s action in different international organisations (UN -in which we would stress the role of the ILO- Bretton Woods, WTO, OECD) in the fields of trade and development as well as economic issues. We also welcome the intention to build on the Helsinki Process on Governance and Democracy, and would emphasise the need to promote dialogue with the social partners, especially on advancing the decent work agenda and on including the social dimension of globalisation in the Union’s external policies in the light of the recommendations made by the World Commission on the Social Dimension of Globalisation.

European Neighbourhood policy - establishment of a new financing instrument

The ETUC draws attention to the need to enhance the capacity of trade unions to play a full part in the democratic development of ENP partner countries, notably by encouraging and consolidating social dialogue in these countries. To this end, we ask that specific budget lines are included in the new instrument to finance the ENP.

Similar considerations apply to countries which are already moving towards EU accession or are potential candidates.

EU Summit Latin America and the Caribbean

The fourth EU-LAC Summit will take place in Vienna on 12-13 May 2006. The main topics on the agenda will be social cohesion and the regional and sub-regional integration processes in Latin America as well as the ongoing negotiations between the EU and Mercosur and the future negotiations with the Andean Community and Central America.

In the run up to the Summit there will be several preparatory events. The ETUC, together with the ICFTU, the WCL and their regional organisations in the region ORIT and CLAT, will organise a trade union summit in April to reach agreement on the trade union proposals to be submitted to the May Summit and to prepare our proposals vis-à-vis the civil society meeting organised by the European ECOSOC.

The ETUC considers it essential that the Summit of Heads of State and Government reaches agreement on the need to include a social chapter in all agreements being negotiated in order to guarantee workers’ fundamental rights and the establishment of the principles to involve civil society. The ETUC expects that the Austrian Presidency will work towards meeting the demand we presented at the Guadalajara Summit on the creation of a Latin American Economic and Social Council, which would become a counterpart to the European ECOSOC. Furthermore we would like to see the development of more cooperation projects addressing labour market issues, such as employment, equality and social dialogue.

China

In 2006, the EU will define its general strategy and will review trade and investment with China. This will provide an opportunity to push forward a coherent approach aimed at encouraging China to integrate fully into the international community and to implement best standards of governance, including observance of core labour standards as defined by the ILO. The ETUC asks to be fully involved in consultations that are required to draw up the strategy. This could help ease the concerns of European workers about a range of economic and social issues in our relations with China. The ETUC also asks to be fully consulted about follow-up actions in the context of the Memorandum of Understanding agreed at the EU-China Summit in September 2005.

EU-ACP Partnership

By adopting the Strategy for Africa and a declaration clarifying the European Consensus for a development policy, the EU has placed its policy towards the ACP countries in a new context of partnership, essentially by highlighting the importance of the Millennium Development Goals. The ETUC therefore hopes that current negotiations on the Economic Partnership Agreements will take account of this dimension and will make sure that the role of the social players is boosted to ensure better respect of the ILO’s core standards. The ETUC is expecting the support of the Austrian Presidency in this respect.

WTO

The Ministerial Declaration of the WTO Conference in Hong Kong makes provision for negotiations to continue during 2006. The ETUC thinks that the conclusion of any agreements requires prior commitment from the WTO and its members to examine the potential impact of the agreements on employment and development and to establish permanent cooperation between the WTO and the ILO. The ETUC is asking the Austrian Presidency to support these demands. The ETUC is opposed to the Union making additional commitments in the water, energy, transport, postal service and telecommunications sectors as well as for mode 4 (temporary movement of natural persons) within the framework of future negotiations on services. Moreover, all non-commercial public services, above all education, health and culture, must continue to be excluded from the liberalisation of trade.